Document:

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                                                                    EXHIBIT 10.9

                                                      NORTEL AGREEMENT NO. _____
                                                   PURCHASER AGREEMENT NO. _____

                            VOLUME PURCHASE AGREEMENT

This Volume Purchase Agreement (the "Agreement") is between Nortel Networks
Corporation, a company incorporated under the laws of Canada, having an office
at 185 Corkstown Road, Nepean, Ontario, Canada K2H 8V4 ("Nortel") and Stanford
Microdevices Inc., a company incorporated under the laws of Delaware, having an
office at 522 Almanor Avenue, Sunnyvale, CA ("Purchaser").

1.      DEFINITIONS

        "Affiliate" of any person shall mean any corporation which, directly or
        indirectly, is controlled by the same person.

        "Blanket Order" shall mean an Order which does not set forth a Delivery
        Date or Shipping Date in respect of the Hardware, and which identifies
        the minimum quantity of Hardware to be ordered by Purchaser from Nortel
        during the period commencing September 1st 1999 and ending August 31st
        2000.

        "Cancellation Period(s)" shall mean the period(s) so designated in
        Appendix C, which shall end on the Shipping Date.

        "Delivery" shall mean Nortel's delivery of Hardware in good condition on
        board a common carrier at Nortel's Shipping Location.

        "Delivery Date" shall mean the date when the Hardware shall be delivered
        to the Delivery Location.

        "Delivery Location" shall mean the location specified in an Order to
        which the Hardware shall be delivered.

        "Hardware" shall mean the hardware set forth in Appendix A
        (individually, a "Hardware"), provided under this Agreement pursuant to
        an Order, as described in the applicable Technical Specifications, but
        shall exclude Services.

        "Maximum Delivery Period" shall mean the period so designated in
        Appendix C which shall commence on the date that Nortel receives an
        Order or a Release.

        "Maximum Order Amount" shall mean the amount so designated in Appendix
        C.

        "Merchandise" shall mean Hardware not ordered as part of the Hardware
        that is needed for expansion, spares or replacement parts.

        "Minimum Order Amount" shall mean the amount so designated in Appendix
        C.

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"Order" shall mean the document used by Purchaser to order Hardware under this
Agreement, and shall specify the quantity of Hardware Purchaser commits to
purchase from Nortel during the subsequent thirteen (13) week period.

        "Parties" shall mean, collectively, Nortel and Purchaser.

        "Party" means, separately, Nortel or Purchaser, as the case may be.

        "Person" shall mean any individual, corporation, partnership, firm,
        joint venture, syndicate, association, trust, government, governmental
        agency, board, commission or authority, and any other form of entity or
        organization.

        "Price Schedule" shall mean the list of prices for the Hardware provided
        to Purchaser by Nortel from time to time.

        "Purchaser Specifications" shall mean any information (including without
        limitation, software, schematics, designs or techniques) supplied by
        Purchaser to Nortel for us in the design or manufacture of the Hardware
        or otherwise incorporated therein.

        "Release" shall mean the document used by Purchaser pursuant to a
        Blanket Order to set the Delivery Date and/or Shipping Date for
        specified quantities of Hardware.

        "Rescheduling Period(s)" shall mean the period(s) so designated in
        Appendix C, which shall end on the Shipping Date.

        "Return Material Authorization" shall mean the distinctive identifier
        provided by Nortel to Purchaser in respect of a Hardware, which
        allegedly does not conform to the warranty in Section 4.1.

        "Services" shall mean services associated with the Hardware which may be
        purchased from or provided by Nortel, such as, but not limited to,
        Hardware replacement, documentation, training or repair pursuant to this
        Agreement.

        "Shipping Date" shall mean the date when a Hardware shall be delivered
        to the carrier at the Shipping Location for shipment to the Delivery
        Location.

        "Shipping Location(s)" shall mean the location(s) so designated in
        Appendix C, from which a Hardware shall be shipped by Nortel.

        "Technical Information" shall mean any information of a scientific or
        technical nature regardless of form or characteristics and in whatever
        form presented, including, but not limited to, inventions, human and
        machine-readable computer software and topography, whether or not
        subject to patent, copyright or other statutory protection.

        "Technical Specifications" shall mean Nortel's standard descriptions,
        engineering information, ordering information, technical specifications,
        installation and test procedures

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        and operating and maintenance/replacement procedures in respect of the
        Hardware. The Technical Specifications are attached hereto as Appendix
        B.

        "Term" shall mean 60 months.

        "Territory" shall mean the world.

        "Vendor Items" shall mean Hardware which is not integral to the
        operation of the Hardware and which is manufactured and/or licensed by
        an entity other than Nortel.

        "Working Day(s)" shall mean Monday through Friday, inclusive, excluding
        holidays recognized by either the federal government of Canada or the
        provincial government of Ontario, excluding December 26 through January
        1, inclusive, unless notice is actually received by an employee of the
        Party to whom it is addressed.

2.      ORDERING AND DELIVERY

2.1     Buyer shall be eligible to place Orders, Blanket Orders, or Releases for
        the Hardware and/or Services, for delivery or performance in the
        Territory, with the benefits of and subject to the terms and conditions
        contained in this Agreement. An Order, Blanket Order or Release
        submitted pursuant to the terms and conditions of this Agreement, and
        which Nortel has accepted within five (5) days of receipt of such Order,
        Blanket Order or Release, shall constitute a contract between Nortel and
        Purchaser, failing such acceptance, any such Order, Blanket Order or
        Release shall be deemed to be void. Purchaser may use the Hardware
        itself in the Territory or use the Hardware to provide services to
        others in the Territory. Purchaser acknowledges and agrees that in no
        circumstances shall this Agreement restrict Nortel from selling, leasing
        or otherwise transferring Hardware, excluding Purchaser Specifications,
        or hardware incorporating purchaser designs/intellectual property, to
        any other Person. [***] Should the terms of any Order, Blanket Order or
        Release conflict with the terms of this Agreement, the terms of this
        Agreement shall govern unless the parties expressly agree in writing to
        the contrary. Notwithstanding that an Order, Blanket Order or Release
        does not refer to this Agreement, any Order, Blanket Order or Release
        issued by Purchaser during the Term shall be deemed to have been issued
        pursuant to this Agreement unless the Parties expressly agree to the
        contrary.

2.2     Purchaser shall issue an Order to Nortel on the third Working Day of
        each week in respect of the subsequent thirteen (13) week period. An
        Order shall set forth a description of the following: (a) Hardware and
        quantity; (b) price (in accordance with the current Price Schedule); (c)
        Delivery Location; (d) the location where the invoice shall be rendered
        for payment; (e) method of shipment; (f) quantity; and (g) Delivery Date
        and/or Shipping Date. An Order or a Release shall not be issued for less
        than the Minimum Order Amount or for more than the Maximum Order Amount
        unless the Parties expressly agree to a larger or smaller amount. All
        shipping documents shall reference the number of the Order issued for
        the Hardware contained in the shipment.

[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment requested has been requested with
respect to the omitted portions.

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2.3     Purchaser agrees to issue Orders for a minimum of one thousand wafers
        over the first twelve months of the Term, according to the release
        schedule as set out in Appendix C

2.4     Within five (5) Working Days of Nortel's receipt of an Order or a
        Release, Nortel shall either confirm the Shipping Date or propose an
        alternate Shipping Date. If Nortel fails to do so, Nortel shall be
        deemed to have agreed to the Shipping Date set forth by Purchaser. If
        Nortel proposes an alternate Shipping Date, then Purchaser shall within
        five (5) Working Days of its receipt of notice of such alternate
        Shipping Date notify Nortel that either such alternate Shipping Date is
        acceptable or such Order or Release is cancelled. If Purchaser fails to
        give such notice, it shall be deemed to have agreed to the alternate
        Shipping Date.

2.5     Purchaser may, without charge, postpone the Shipping Date at any time
        prior to the commencement of the Rescheduling Period, for a period of up
        to ninety (90) days. If Purchaser cancels an Order or a Release prior to
        the commencement of the Cancellation Period, there shall be no charge to
        Purchaser. If Purchaser cancels an Order or a Release during the
        Cancellation Period, Purchaser shall reimburse Nortel for the actual
        costs Nortel has incurred in connection with the manufacture of such.

2.6     Purchaser may, at any time, request additions, alterations, deductions
        or deviations to an Order subject to the condition that such changes and
        any adjustments resulting from such changes including, but not limited
        to, schedules and prices, shall be mutually agreed upon and, if so
        agreed, subsequently detailed in a written revision to the applicable
        Order (a "Change Order"). Purchaser acknowledges that a premium charge
        may be applied by Nortel should Nortel agree to process a Change Order
        outside of its standard Order processing cycle for a Hardware or in the
        event that a Change Order requires an additional amount of work (such as
        engineering) to be undertaken to comply with such changes.

2.7     The Parties may add new Hardware to Appendix A upon mutual agreement in
        writing. The process the Parties shall follow, unless otherwise mutually
        agreed, to add new Hardware to Appendix A is described in Appendix E.

2.8     In the event that Nortel decides to cease production of the Hardware for
        any reason, including but not limited to discontinuance of its wafer
        manufacturing business or significant changes to its wafer manufacturing
        process, Nortel will provide Purchaser with a written end-of-life notice
        six (6) months prior to such end of production. Upon receipt of such
        notice, Purchaser shall submit last time purchase orders to Nortel no
        later than either (a) three (3) months after receipt of such notice if
        Purchaser's last time purchase order is for a quantity of hardware that
        will exceed one hundred fifty (150%) of the quantity of Hardware
        purchased under this Agreement in the twelve (12) months preceding
        Purchaser's receipt of such notice or (b) no later than six (6) months
        after receipt of such notice if Purchaser's last time purchase order is
        for a quantity of hardware that are less than one hundred fifty (150%)
        of the quantity of Hardware purchased under this Agreement in the twelve
        (12) months preceding Purchaser's receipt of such notice. The maximum
        quantity of a last time purchase may not exceed three hundred percent
        (300%) of the quantity purchased under this Agreement in the twelve (12)
        months preceding Purchaser's receipt of such notice and Purchaser must
        take delivery of the full order with fifteen (15) months of the notice,
        unless rescheduled by Nortel

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        in its sole discretion. Last time purchase orders shall be subject to
        the terms and conditions of this Agreement.

3.      PRICE, PAYMENT AND RISK OF LOSS

3.1     Unless otherwise indicated in the Price Schedule, the prices set forth
        in the Price Schedule are: (a) in U.S. dollars; (b) F.O.B. Nortel's
        Shipping Location; (c) exclusive of any applicable excise and sales
        taxes now existing or hereinafter imposed by any applicable taxing
        authority; and (d) exclusive of transportation and insurance charges
        applicable between the Shipping Location and the Delivery Location. Such
        taxes, transportation and insurance charges and duty for which Purchaser
        is liable shall be separately stated on the invoice.

3.3     As of the moment of Delivery of a Hardware, Purchaser accepts all risks
        of loss, mishandling, breakage, and other damages relating thereto.
        Times quoted for Delivery will date from acceptance of the Order by
        Nortel. Title shall pass to Purchaser upon receipt of full payment by
        Nortel. If Purchaser returns a Hardware, risk of loss or damage for such
        Hardware shall pass to Nortel when Purchaser delivers the Hardware to
        the Shipping Location.

3.4     Purchaser grants to Nortel a first priority purchase money security
        interest in the Hardware. Nortel may perfect such interest, and
        Purchaser shall assist Nortel, as reasonably necessary, to do so. Nortel
        may retain such interest until title to the Hardware has passed to
        Purchaser. Prior to Hardware title transfer, Purchaser shall not cause
        or permit the Hardware or any portion thereof, to be sold, leased or
        subjected to a lien or other encumbrance.

3.2     Nortel shall issue invoices for Hardware and/or Services ordered
        hereunder as follows:

        (a) Invoices for Hardware, Merchandise and/or Vendor Items shall be
        issued upon Delivery of the Hardware, Merchandise and/or Vendor Items.

        (b) Invoices for Services shall be issued upon completion of the
        Services.

        (c) All invoices shall be paid in full by Purchaser within [***]
        days of the date of Nortel's invoice. Overdue payments may, at Nortel's
        sole discretion, be subject to interest charges, calculated daily from
        the date due, at one percent (1%) per month, twelve percent (12%) per
        annum) or such lesser rate as maybe the maximum permissible rate under
        applicable law.

        (d) All payments hereunder shall be made in U.S. dollars ($U.S.).

4.      WARRANTY

4.1     Nortel warrants to Purchaser that Hardware will at the time of delivery
        are new and free and clear of all liens and encumbrances. Nortel further
        warrants that the hardware will be free from defects in material and
        workmanship for a period of twelve months after delivery such that the
        hardware meets the technical specifications outlined in appendix B.

[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment requested has been requested with
respect to the omitted portions.

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4.2     Purchaser shall provide written or verbal notice of any Hardware, which
        does not conform to the warranty described in Section 4.1 within two
        weeks of discovery of such defects. If Purchaser has not so notified
        Nortel of any such nonconformance within two weeks of discovery of such
        defects of the relevant Hardware, Purchaser shall be deemed to have
        accepted this Hardware and Nortel shall have no obligation to replace
        this Hardware. If Purchaser does notify Nortel of a nonconformance to
        the warranty described in section 4.1 within two weeks of the discovery
        of such defects of the relevant Hardware, Nortel shall, at Nortel's
        option, replace the Hardware which does not conform to the warranty or
        (b) refund to Purchaser the price of such Hardware. All transportation
        and other expenses arising from shipping the non-conforming Hardware to
        the Shipping Location shall be paid by Purchaser. All transportation and
        other expenses arising from shipping the repaired or replaced
        non-conforming Hardware from the Shipping Location to the Delivery
        Location shall be paid by Nortel.

4.3     Purchaser shall provide written or verbal notice of any Hardware, which
        does not conform to the incoming inspection as outlined in Appendix B.
        If Purchaser has not so notified Nortel of any such nonconformance
        within five weeks of delivery of the relevant Hardware, Purchaser shall
        be deemed to have accepted this Hardware and Nortel shall have no
        obligation to replace this Hardware. If Purchaser does notify Nortel of
        a nonconformance to the incoming inspection as outlined in Appendix B
        within five weeks of the delivery of the relevant Hardware, Nortel
        shall, at Nortel's option, replace the Hardware which does not conform
        to the incoming inspection or (b) refund to Purchaser the price of such
        Hardware. All transportation and other expenses arising from shipping
        the non-conforming Hardware to the Shipping Location shall be paid by
        Purchaser. All transportation and other expenses arising from shipping
        the repaired or replaced non-conforming Hardware from the Shipping
        Location to the Delivery Location shall be paid by Nortel.

4.4     Vendor Items resold by Nortel as part of the Hardware provided hereunder
        shall bear the warranty of the original equipment manufacturer only.

4.5     Nortel shall assign a Return Material Authorization to each Hardware
        identified by Purchaser as allegedly not conforming to the warranty in
        Section 4.1 Nortel shall promptly provide the Return Material
        Authorization to Purchaser. Purchaser and Nortel shall use the Return
        Material Authorization in all communications in respect of such
        Hardware.

4.6     THE WARRANTIES PROVIDED HEREUNDER ARE IN LIEU OF ALL OTHER WARRANTIES,
        GUARANTEES OR CONDITIONS PERTAINING TO THE HARDWARES AND SERVICES,
        WRITTEN OR ORAL, STATUTORY, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY
        AS TO MERCHANTABILITY, FITNESS FOR ANY PARTICULAR PURPOSE OR
        NONINFRINGEMENT, AND THE PROVISIONS HEREIN SHALL CONSTITUTE NORTEL'S
        SOLE OBLIGATION AND LIABILITY AND PURCHASER'S SOLE REMEDY FOR BREACH OF
        WARRANTY. NORTEL SHALL NOT BE RESPONSIBLE FOR ANY WARRANTY OFFERED BY
        PURCHASER TO ANY CUSTOMER(S) OF PURCHASER. IN NO EVENT SHALL NORTEL BE
        LIABLE FOR ANY

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        INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES RELATING TO
        BREACH OF WARRANTY.

5.      TERM AND TERMINATION

5.1     This Agreement shall commence on the Effective Date and continue in
        effect for the Term. This Agreement shall be automatically renewed for
        additional terms of twelve (12) months each on an annual basis after the
        Term, unless either Party notifies the other in writing of its intent to
        terminate the Agreement, and such notice is received at least sixty
        (180) days prior to the end of the current term.

5.2     Subject to Sections 5.3 and 5.4, the termination of this Agreement shall
        not effect the rights or obligations of either Party to the other under
        any Order or Release issued by Purchaser and accepted by Nortel prior to
        such termination.

5.3     If either Party shall be declared insolvent or bankrupt, or if any
        assignment of its property shall be made for the benefit of creditors or
        otherwise, or if its interest herein shall be levied upon under
        execution or seized by virtue of any writ of any court, or if a petition
        is filed in any court to declare such Party bankrupt and not dismissed
        in sixty (60) days, or if a trustee in bankruptcy, receiver or
        receiver-manager or similar officer is appointed for such Party or for
        any of such Party's assets, then the other Party may, at its option,
        terminate, without charge, this Agreement and/or any or all outstanding
        Orders and Releases and shall thereupon be free from all liability and
        obligations thereunder. The ability of a Party to terminate in such
        instances shall be subject to the applicable bankruptcy and insolvency
        statutes.

5.4     Subject to Section 5.3, a Party (the "Non-Breaching Party") may
        terminate an Order or a Release only if the other Party (the "Breaching
        Party") is in material breach of a term of this Agreement or an Order or
        Release and such breach has not been corrected within thirty (30)
        Working Days after the date of the Non-Breaching Party's notice thereof
        to the Breaching Party. In the event Purchaser terminates an Order or
        Release pursuant to this Section 5.4, Purchaser shall reimburse Nortel
        for the actual costs incurred to date in connection such Order or
        Release.

6.      INTELLECTUAL PROPERTY RIGHTS

6.1     This Agreement shall not constitute any transfer of intellectual
        property rights of any nature whatsoever.

6.2     Nortel acknowledges that all Purchaser Specifications for the Hardware
        are the property of Purchaser.

6.3     Subject to Section 6.4 below, Nortel agrees not to use the Purchaser
        Specifications or any customized ASIC, test vectors, or tooling
        generated exclusively for the Hardware in the course of development
        other than for the manufacture of the Hardware on behalf of Purchaser.
        Purchaser acknowledges and agrees that place and route data, database
        tapes, mask sets and other customized data relating to the Hardware
        contain proprietary information

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        of Nortel and Purchaser, and such materials shall therefore remain in
        the custody of Nortel at all times. Upon request of Purchaser, however,
        Nortel shall destroy such materials produced for Purchaser and provide
        certification thereof.

6.4     Nortel or its licensors shall own and retain all intellectual property
        rights (including, without limitation, mask work rights) associated with
        any and all circuitry design components and process technology furnished
        by Nortel in connection with the design, development or manufacture of
        the Hardware, including but not limited to 9I) all base array layers
        (ii) all Nortel-licensed library elements (including, without
        limitation) any megafunctions or macrocells) and (iii) all
        Nortel-furnished modification of any such library elements. The rights
        of Purchaser in the Hardware designed hereunder shall be strictly
        limited to control of the customized configuration of the Hardware
        created by the interconnections of such elements of hardware information
        contained in the Hardware manufactured for Purchaser.

6.5     Nortel shall own any process, pattern or device discovered by Nortel in
        the course of performing this Agreement. If Purchaser discovers any
        process, pattern, or device in the course of designing or developing the
        Hardware, Nortel shall automatically acquire a fully paid, perpetual,
        worldwide license to use such invention in connection with the
        manufacture of the Hardware. The Parties shall be deemed joint owners of
        any invention, which is jointly discovered.

6.6     Purchaser covenants not to remove, modify or obscure Nortel's logos and
        part numbers on the Hardware.

7.      CONFIDENTIAL INFORMATION

7.1     Any Technical Information, specifications, drawings, documentation,
        schematics, models, pricing information and "know-how" of every kind and
        description whatsoever provided by one Party ("Discloser") to the other
        ("Recipient") in connection with the negotiation or performance of this
        Agreement or any Order or Release, regardless of form, shall be deemed
        to be confidential information, and the exclusive property, of Discloser
        except if such information is: (a) in or becomes part of the public
        domain through no fault of Recipient; (b) disclosed to Recipient by a
        third party without restriction; (c) known to Recipient at the time of
        disclosure and is so documented; (d) independently developed by
        Recipient without access to any information furnished to it by Discloser
        and is so documented; or (e) disclosed when such disclosure is compelled
        pursuant to legal, judicial or administrative proceeding, or otherwise
        required by law, subject to Recipient giving all reasonable prior notice
        to Discloser to allow it to seek protective or other court orders. All
        such confidential information, except as specifically authorized in
        writing by Discloser or as provided hereunder, shall be held in
        confidence by Recipient and, if in written form, returned to Discloser
        upon its request. Recipient shall not: (x) disclose or allow to be
        disclosed such information except to its employees who have a bona fide
        need to know; (y) reproduce such information without the written consent
        of Discloser; or (z) use any of such information for any purpose other
        than the satisfaction of its rights and obligations under this
        Agreement. The foregoing obligations of confidentiality shall survive
        for a period of five (5) years after the applicable disclosure,
        notwithstanding the termination or expiration of this Agreement.

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8.      INDEMNIFICATION

8.1     Nortel, at its expense, shall indemnify, defend and hold harmless
        Purchaser against any claim in the United States of America or Canada
        based on an allegation that a Hardware (except for Vendor Items)
        infringes a United States or Canadian patent, copyright, or trademark of
        another Person, or violates any trade secret or other proprietary
        interest of another Person except in respect of any claim relating to
        designs or information furnished by Purchaser, and Nortel will pay any
        resulting costs, damages, and attorney's fees finally awarded against
        Purchaser that are attributable to such claim and will pay the part of
        any settlement that is attributable to such claim provided that: (a)
        Purchaser notifies Nortel promptly in writing of the claim; (b) Nortel
        is permitted to control the defense or settlement of the claim; and (c)
        Purchaser cooperates reasonably in such defense or settlement at
        Nortel's expense. Purchaser shall not settle or compromise any such
        legal action without Nortel's prior written approval. The selection of
        counsel to be employed in the defense of such legal action shall be
        within Nortel's sole discretion. Such indemnity shall not apply in the
        event the Hardware(s) have been modified by Purchaser, have been
        utilized in a manner other than as specified by Nortel or are used or
        located outside the Territory. The indemnity provided herein shall not
        extend to any legal action based upon any infringement or alleged
        infringement of any patent, trademark or copyright by Vendor Items, or
        by the combination of any Hardware furnished by Nortel with other
        equipment not furnished by Nortel. Notwithstanding the above, Nortel
        shall have no obligation or liability with regard to any patent
        infringement suit, claim, or proceeding that may be made or brought
        against Purchaser (i) alleging that method of use claims in such patent
        are infringed by any service offering and/or by any use by Purchaser of
        Hardware furnished hereunder to make such service offering available or
        (ii) resulting in a settlement payment, or award of damages, or
        accounting of profits, where such settlement, award, or accounting is
        based on the revenues or profits earned or other value obtained by
        Purchaser from its use of such Hardware and/or is based on the lost
        revenues or profits of third parties arising from Purchaser's use of
        such Hardware.

8.2     In its defense or settlement of any such claim described in Section 8.1
        Nortel may: (a) procure for Purchaser the right to continue using the
        Hardware; (b) modify the Hardware or the Hardware manufacturing process
        so that the use or manufacturing of the Hardware becomes non-infringing;
        (c) replace the Hardware with equivalent Hardware not subject to such
        claim; or (d) in the event none of the foregoing is commercially
        feasible, refund Purchaser the price paid for such Hardware, and
        Purchaser shall return such Hardware to Nortel immediately.

8.3     Independent of any other limitation, in no event shall Nortel be liable
        to Purchaser or to parties claiming through or on behalf of Purchaser
        for special, incidental, exemplary, consequential or indirect damages or
        for loss of anticipated profits pursuant to the indemnities provided in
        this Article 8. In no event shall Nortel's liability to Purchaser or its
        customers or any other Persons pursuant to Section 8.1 exceed in the
        aggregate the monies received by Nortel from Purchaser pursuant to this
        Agreement to the date of such claims. The foregoing states the entire
        obligation and liability of Nortel with respect to infringement or
        violation of any proprietary interest of another Person and claims
        thereof.

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8.4     Purchaser, at its expense, shall indemnify, defend and bold harmless
        Nortel against any claim based on an allegation that the designs and
        information provided by Purchaser in respect of Hardware infringes a
        patent, copyright, or trademark of another Person, or violates any trade
        secret or other proprietary interest of another Person, and Purchaser
        will pay any resulting costs, damages, and attorney's fees finally
        awarded against Nortel that are attributable to such claim and will pay
        the part of any settlement that is attributable to such claim provided
        that: (a) Nortel notifies Purchaser promptly in writing of the claim;
        (b) Purchaser is permitted to control the defense or settlement of the
        claim; and (c) Nortel cooperates reasonably in such defense or
        settlement at Purchaser's expense.

8.5     In its defense or settlement of any such claim described in Section 8.4
        Purchaser may: (a) procure for Nortel the right to continue using the
        design and information; (b) modify the design and information so that it
        is non-infringing; or (c) replace the design and information with an
        equivalent design and information not subject to such claim.

8.6     Independent of any other limitation, in no event shall Purchaser be
        liable to Nortel or to parties claiming through or on behalf of Nortel
        for special, incidental, exemplary, consequential or indirect damages or
        for loss of anticipated profits pursuant to the indemnity in Section
        8.4.

8.7     Each Party hereto shall indemnify and save the other harmless from any
        liabilities, claims or demands (including the costs, expenses and
        reasonable attorney's fees on account thereof) that may be made by
        anyone for bodily injuries, including death, or damage to tangible
        personal property, resulting from the negligence and/or willful
        misconduct of that Party, its employees or agents in the performance of
        this Agreement. Each Party shall defend the other at the other's request
        against any such liability, claim or demand. Each Party shall notify the
        other promptly of written claims or demands against such Party of which
        the other Party is responsible hereunder.

9.      LIMITATION OF LIABILITY

9.1     IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY SPECIAL, INCIDENTAL,
        INDIRECT, EXEMPLARY OR CONSEQUENTIAL DAMAGES OR LOSS FOR ANY BREACH OF
        THIS AGREEMENT, TORT OR OTHER LEGAL THEORY, INCLUDING NOT LIMITED TO
        LOSS OF OPPORTUNITY, USE, INCOME OR PROFIT OR OTHER SUCH CLAIMS ARISING
        FROM ANY CAUSE WHATSOEVER. THIS LIMITATION SHALL SURVIVE ANY TERMINATION
        OF THIS AGREEMENT. IN NO EVENT SHALL NORTEL BE LIABLE FOR DAMAGES FOR
        ANY CAUSE WHATSOEVER IN ANY AMOUNT IN EXCESS OF, IN AGGREGATE, THE
        MONIES RECEIVED BY NORTEL FROM PURCHASER PURSUANT TO THIS AGREEMENT TO
        THE DATE OF SUCH LIABILITY.

9.2     Any action for breach of this Agreement or to enforce any right
        hereunder shall be commenced within two (2) years after the cause of
        action occurs or it shall be deemed waived and barred.

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10.     FORCE MAJEURE

10.1    Nortel shall not be responsible or liable to Purchaser for any delay or
        failure to perform hereunder if such delay or failure results from fire,
        explosion, labor dispute, earthquake, casualty or accident, lack or
        failure of transportation facilities, epidemic, flood, drought, or by
        reason of war, declared or undeclared, revolution, civil commotion, the
        act of a public enemy, blockade or embargo, act of God, any inability to
        obtain any requisite license, permit or authorization, or by reason of
        any law, proclamation, regulation, ordinance, demand, or requirement of
        any government or by reason of any other cause whatsoever, whether
        similar or dissimilar to those enumerated, beyond the reasonable control
        of Nortel. With respect to labor disputes as described above, Nortel
        shall not be obligated to accede to any demands being made by employees
        or other personnel. All such causes will delay Nortel's performance
        hereunder for a period equal to the delay resulting from any such causes
        and such additional period as may be reasonably necessary to allow
        Nortel to resume its obligations.

11.     ACCESS TO PREMISES

11.1    Each Party shall, subject to reasonable notice, have access to the
        premises of the other Party in order to perform their respective
        obligations under this Agreement. Each Party shall comply with the
        general security and safety rules of the other Party, as appropriate,
        when in such premises. In addition, each Party acknowledges that its
        access to the other Party's premises may be restricted by the host
        Party, acting reasonably, in order to preserve the host Party's trade
        secrets and obligations of confidentiality to third parties.

12.     GENERAL

12.1    Any notices to be given under this Agreement shall be sent by certified
        mail, postage prepaid, or by facsimile or hand delivery to the other
        Party at the addresses set forth below and to the attention of:

        Nortel:       Legal notices:
                      Corporate Secretary
                      Nortel Networks Corporation
                      8200 Dixie Road, Suite 100
                      Brampton, Ontario
                      L6T 5P6 Canada

                      Business notices:
                      Nortel Advanced Components
                      Nortel Networks Corporation
                      185 Corkstown Road
                      Nepean, Ontario
                      K2H 8V4 Canada

                                      -11-
<PAGE>   12

               Stanford Microdevices:       Stanford Microdevices
                                            Attn: Jerry Quinnell
                                            Chief Operating Officer
                                            522 Alamnor Ave.
                                            Sunnyvale, CA USA 94086
                                            Fax: (408) 739-0970

12.2    Notices shall be deemed to have been received five (5) Working Days
        after mailing if given by mail, one (1) Working Day after sending if
        given by facsimile and upon delivery if given by hand. A Party may
        change its address for notices by written notice to the other Party in
        the manner provided in Section 12.1.

12.3    The failure of a Party to enforce any provision of this Agreement shall
        not constitute a waiver of such provision or the right of such Party to
        enforce such and every other provision.

12.4    The validity, interpretation and performance of this Agreement, the
        rights and obligations arising hereunder and any purchase made hereunder
        shall be governed by the laws of the Province of Ontario and the federal
        laws of Canada applicable therein, without giving effect to the
        principles of conflicts of laws thereof and without reference to the
        UNCITRAL Convention on Agreements for the International Sale of Goods.

12.5    Neither Party shall assign this Agreement or any rights hereunder
        without the prior written consent of the other Party. Notwithstanding
        the foregoing, Nortel may assign this Agreement to any Nortel Affiliate
        or manufacturing licensee without the consent of the Purchaser. Nortel
        may subcontract any of its obligations under this Agreement, but no such
        subcontract shall relieve Nortel of primary responsibility for
        performance of its obligations.

12.6    Purchaser shall not export any technical data received from Nortel
        pursuant to this Agreement, or release any such technical data with the
        knowledge or intent that such technical data will be exported or
        transmitted to any country or to foreign nationals of any country,
        except in accordance with applicable U.S. and/or Canadian law concerning
        the exporting of such technical data Purchaser shall obtain all
        authorizations from the U.S. and/or Canadian government in accordance
        with applicable law prior to exporting or transmitting any such
        technical data as described above.

12.7    A Party shall not release, without the prior written approval of the
        other Party, any advertising or other publicity relating to this
        Agreement wherein such other Party may reasonably be identified. In
        addition, each Party shall take reasonable precautions to keep the
        existence of this Agreement confidential so long as this Agreement
        remains in effect and for a period of [***] years thereafter, except
        as may be otherwise expressly provided in this Agreement or as may be
        reasonably required to enforce this Agreement by law.

12.8    Section headings are inserted for convenience only and shall not be used
        to interpret this Agreement.

[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment requested has been requested with
respect to the omitted portions.

                                      -12-
<PAGE>   13

12.9    All obligations and liabilities which, by their nature, are intended to
        survive the expiration or termination of this Agreement shall remain in
        effect beyond any expiration or termination.

12.10   The invalidity in whole or in part of any provision of these terms and
        conditions shall not void or effect the validity of any other provision
        of this Agreement. The Parties hereto agree to substitute any provision
        of these terms and conditions which is or shall become invalid by such
        provision which in its legal and commercial contents is the most similar
        to the invalid provision.

12.11   This Agreement, including the Appendices to it, constitutes the entire
        agreement between the Parties on the subject matter hereof and
        supersedes prior agreements and communications, written or oral, with
        respect thereto. Except for the information which must be set forth in
        an Order, Blanket Order or Release in accordance with Articles 1 and 2,
        any additional or different term set forth in any Order, Blanket Order
        or Release, acknowledgment form, quotation or other document hereafter
        issued shall be void. This Agreement may not be modified or any right of
        a Party waived, except by means of an amendment, which expressly
        references this Agreement and is duly executed by each of the Parties.

12.12   This Agreement is not intended to and shall not constitute, create, give
        effect or otherwise recognise a joint venture, partnership, agency
        relationship or formal business entity of any kind.

IN WITNESS WHEREOF, the Parties hereto have signed this Agreement by their duly
authorized representatives as of the date first written above.

Nortel Networks Corporation                  STANFORD MICRODEVICES INC.

By:  /s/ Barbara Callaghan                   By: /s/ Robert M. Van Buskirk
     -------------------------------             -------------------------------

Print Name:   Barbara Callaghan              Print Name:   Robert M. Van Buskirk
           -------------------------                    ------------------------

Title:   VP & GM Microelectronics            Title:   CEO
      ------------------------------               -----------------------------

Date:   October 12, 1999                     Date:  15 September 1999
      ------------------------------              ------------------------------

By:  /s/ D. Wilson                           By:
     -------------------------------             -------------------------------

Print Name:   D. Wilson                      Print Name:
           -------------------------                    ------------------------

Title:  Sr. Counsel                          Title:
      ------------------------------               -----------------------------

Date:  9 Nov 99                              Date:
      ------------------------------              ------------------------------

                                      -13-
<PAGE>   14

                                   APPENDIX A

                                    HARDWARES

[***]

[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment requested has been requested with
respect to the omitted portions.
<PAGE>   15

                                   APPENDIX B

                            TECHNICAL SPECIFICATIONS

[***]

[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment requested has been requested with
respect to the omitted portions.
<PAGE>   16

                                   APPENDIX C

                                     GENERAL

Shipping Location:

Delivery Location:

Rescheduling Period:  13 weeks

Cancellation Period:  13 weeks

Maximum Delivery Period:  15 weeks

Minimum Order Amount:  [***]

Maximum Order Amount:  [***]

Release Schedule:     [***] Total release to equal 1,000 wafers.

[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment requested has been requested with
respect to the omitted portions.

<PAGE>   17

                                   APPENDIX D

[***]

[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment requested has been requested with
respect to the omitted portions.
<PAGE>   18

                                   APPENDIX E

                        NEW HARDWARE INTRODUCTION PROCESS

              Nortel requires a fabrication cycle time of 13 weeks.<PAGE>   1
                                                                   EXHIBIT 10.10

                                SUPPLY AGREEMENT

        This Agreement (the "Agreement") is entered into this 7th day of
October, 1999 by and between Spectrian, Inc., Semiconductor Division, having its
office at 350 West Java Drive, Sunnyvale, California, 94089, hereinafter
referred to as "SPECTRIAN"

        and

        Stanford Microdevices Inc., having its office at 522 Almanor Avenue,
Sunnyvale, CA 94086, USA, hereinafter referred to as "SMI".

        SPECTRIAN desires to sell, and SMI desires to buy, semiconductor wafers,
transistors, and capacitors to be manufactured by SPECTRIAN using proprietary
designs, pursuant to the terms and conditions of this Agreement.

        NOW, THEREFORE in consideration of these premises, and the mutual
promises and conditions in this Agreement, the parties agree as follows.

        1. Scope of Agreement.

               1.1 Subject to the terms and conditions contained in Section 14
of this Agreement, SMI and SPECTRIAN hereby will disclose Know-how as defined
below and Confidential information, as defined in Section 14 to have wafers,
transistors and capacitors made at SPECTRIAN's fabrication facility in
Sunnyvale, California, in accordance with the Wafer, Transistor, and Capacitor
Specifications set forth in Exhibit A, and to test such wafers, transistors and
capacitors, and to sell such wafers, transistors, and capacitors to SMI at the
prices established in Exhibit B.

                      "Know-how", when used in this Agreement, shall mean all of
SPECTRIAN designs, techniques, technology, trade secrets, proprietary
information and other confidential information disclosed by SPECTRIAN to SMI
pursuant to this Agreement, which SPECTRIAN and SMI jointly agree is necessary
for SPECTRIAN to produce wafers, transistors, and capacitors under this
Agreement.

               1.2 SPECTRIAN shall provide the necessary support to train SMI
personnel in the assembly and test of transistors procured under this Agreement
in accordance with the transistor assembly documents listed in Exhibit D. This
transfer of assembly and test know-how shall occur not later than six months
after the signing of the Agreement, with a goal of three months.

               1.3 [***]

               1.4 SPECTRIAN and SMI mutually agree that from time to time and
upon the agreement of the parties, additional new products may be added to the
Agreement.

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.
<PAGE>   2

               1.5 [***]

        2. License.

               2.1 SPECTRIAN hereby grants SMI and its wholly owned subsidiaries
a worldwide non-exclusive and non-transferable marketing license to sell certain
finished discrete LDMOS transistor devices and dies identified by product
specifications attached to this Agreement, which shall be marketed under the SMI
label.

               2.2 SPECTRIAN hereby grants SMI and its wholly owned subsidiaries
a worldwide, royalty-free, non-exclusive and non-transferable license to the
technology and Know-how necessary to assemble and test stand alone transistor
devices manufactured with wafers procured under this Agreement. No license shall
be granted to SMI with respect to the wafer fabrication process technology,
rather, SPECTRIAN will supply to SMI for assembly semiconductor dies on which
SPECTRIAN has fabricated the applicable transistor device. SPECTRIAN shall make
available to SMI LDMOS dies manufactured using processes and structures
developed by SPECTRIAN after the effective date of this Agreement in SPECTRIAN's
fab for power amplifier devices. In addition, SPECTRIAN shall provide SMI access
to all related LDMOS assembly and test technologies developed by SPECTRIAN and
deemed necessary by SMI to develop new transistor designs. Spectrian hereby
grants SMI and its wholly owned subsidiaries a non-exclusive and
non-transferable, royalty, worldwide free license to the intellectual property
listed in Exhibit E of the Agreement required for the assembly and test of
transistors using SPECTRIAN dice. The parties shall mutually agree on the
contents of Exhibit E, which will be defined by December 31, 1999; provided
that, should SMI use the intellectual property defined in Exhibit E with other
foundries' dice, then a future royalty agreement may be negotiated between
SPECTRIAN and SMI.

        3. Payment.

               3.1 SMI shall pay in United States Dollars for wafers supplied by
SPECTRIAN to SMI hereunder within [***] days after SMI receipt of an invoice
from SPECTRIAN which shall be submitted to SMI upon shipment.

        4. Orders, Warranty and Claims.

               4.1 SPECTRIAN shall supply wafers, transistors, and parts to SMI
in accordance with written purchase orders to be provided by SMI. Each purchase
order shall include the following:

                      (a) purchase order number;

                      (b) product name;

                      (c) manufacturing process;

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.

                                      -2-
<PAGE>   3

                      (d) quantities;

                      (e) unit wafer, transistor, and/or parts prices and total
prices;

                      (f) desired shipment date (subject to Section 6 "DELIVERY
TIMES" below);

                      (g) delivery instructions; and

                      (h) any special requests or comments.

        Subject orders shall become effective only upon the written acceptance
thereof by SPECTRIAN within 5 working days.

        The terms of this Agreement shall prevail over any conflicting terms in
any order documents, invoices or similar documents exchanged between the parties
hereunder.

               4.2 SMI shall place an annual purchase order with SPECTRIAN for
the finished transistor devices shown in Exhibit A to be sold to the merchant
market and for wafers to be utilized in manufacturing transistors for sale to
the merchant market. SMI and SPECTRIAN shall hold annual pricing negotiations
for the products shown in Exhibit A or more frequently as required to meet
specific demands of the merchant market.

               4.3 SMI shall provide SPECTRIAN every month with a good faith
four (4) month rolling forecast of its wafer, transistors, and parts
requirements on a monthly basis, and SPECTRIAN shall use its best efforts to
make available to SMI sufficient fabrication, assembly and test capacity to meet
such forecast requirements. In addition to the status reports established under
Section 7 below, the parties shall provide one another with reasonable notice
about changes in desired shipping or production schedules, availability of
capacity or other similar situations. The forecast is considered as a firm order
for a period of thirty (30) days; changeable by [***] in the 31-59 day period,
and changeable as much as required in the period of 60 days or greater.

                      a. Any other provision of this Agreement notwithstanding,
if SPECTRIAN shall be delayed more than sixty (60) days in the production and
delivery of wafers, transistors or parts for any particular SMI purchase order,
regardless of cause, SMI may, at its reasonable discretion, provided that
SPECTRIAN is unable to provide a recovery program acceptable to SMI, cancel such
order effective upon written notice thereof to SPECTRIAN. Upon resubmission of
any such cancelled order by SMI and acceptance thereof by SPECTRIAN, SPECTRIAN
shall then use its best efforts to give a priority delivery date to such new
order. If SPECTRIAN delays production and delivery more than sixty (60) days
under three (3) or more SMI purchase orders in any six (6) months' period under
this Agreement, SMI may terminate this Agreement immediately by sending notice
of termination to SPECTRIAN.

                      b. SPECTRIAN gives warranty on workmanship and material
for [***] months. In case of warranty claims by SMI, SPECTRIAN's warranty is
limited to the replacement of wafers, transistors, and/or parts.

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.

                                      -3-
<PAGE>   4

        5. Product Support.

               5.1 SPECTRIAN agrees to provide technical assistance and other
support to SMI as reasonably required. SPECTRIAN agrees to provide the
information necessary for SMI to generate technical sales data and marketing
collateral for the devices shown in Exhibit A. SMI shall be responsible for the
production of all sales literature and collateral.

        6. Delivery Times.

               6.1 Unless otherwise agreed to in writing by SMI, delivery times
upon acceptance of a SMI purchase order by SPECTRIAN shall be:

                      a) WAFERS - twelve (12) weeks for production wafers for
quantities up to 100 wafers, with the target to go down to eight (8) weeks in
2000; delivery times for quantities beyond 100 wafers are to be mutually agreed
upon.

                      b) TRANSISTORS - In accordance with the acknowledged
purchase orders.

                      c) CAPACITORS - In accordance with the acknowledged
purchase orders.

        SPECTRIAN shall use its best efforts to achieve all delivery times on a
regular and consistent basis.

               6.2 In the event of a third party suit or claim against SMI
and/or SPECTRIAN involving a Third Party Right (as defined in Section 16),
SPECTRIAN may, at its reasonable discretion and upon advice of its legal
counsel, suspend or terminate the production and supply of any wafers and
transistors to SMI if such continued production and supply would or could cause
SPECTRIAN to violate such Third Party Right. SPECTRIAN shall discuss any such
suspension or termination with SMI and shall give due opportunity for SMI to
satisfy the provisions of Section 16, prior to the implementation thereof. In
case SPECTRIAN interrupts production due to circumstances described hereinabove,
it shall provide reasonable assistance to SMI in order to re-establish
deliveries of wafers and transistors, if appropriate, by subcontracting to
another foundry.

        7. Status Reports.

               7.1 Upon request from SMI, SPECTRIAN shall provide SMI with
work-in-process information, in SMI content and format, status reports, with
projection of waferout and transistor completion dates.

               7.2 Any deviations from acknowledged delivery dates due to
unforeseen manufacturing problems shall be reported to SMI within 3 working days
when such problems become apparent.

                                      -4-
<PAGE>   5

        8. Process Changes.

               8.1 Either party may request the other party to accept changes in
the production process for wafers, provided, however, any material changes to
the production process for wafers that has been previously approved by SMI for
production of its wafers, including changes to procedures, flow or
specifications, may only be made if such changes are first approved in writing
by SMI, which approval shall not be unreasonably withheld.

               8.2 Changes requiring written approval are major changes as
described in Exhibit C.

        9. Ownership and Responsibility.

               a. SPECTRIAN and SMI acknowledge that each party will own its
pre-existing technology, and any technology solely created by it. SPECTRIAN will
own any and all intellectual property developed solely by SPECTRIAN related to
semiconductor manufacturing, the die, packaging or internal matching of devices
covered by this agreement. Except as set forth above, all know-how and
inventions relating to the design of devices, device assembly, or internal
matching of devices jointly invented by the parties in the course of product
development efforts will be jointly owned and each party shall retain the right
to use and license such technology.

        10. Discontinuation of Production.

               a. SPECTRIAN agrees, upon notification to SMI that SPECTRIAN will
render obsolete or make a major fab process change, close the wafer fab, or
change ownership, to make available for purchase at the option of SMI that
quantity of wafers equal to SMI's past purchases or reasonably anticipated
future purchases under this Agreement, as the case may be, over a five (5) year
period of time. SPECTRIAN will provide notification at least 12 months in
advance of time of obsolescence or major process change. Delivery of wafers
ordered under this provision will be at a mutually agreeable rate but shall in
no case extend over a period greater than 12 months.

        11. Spectrian Quality Inspection.

               11.1 SPECTRIAN shall ship only such wafers, transistors or parts
as have passed visual inspection and electrical testing by SPECTRIAN, in
accordance with the latest approved revisions in effect of the specifications
set forth in Exhibit A.

               11.2 SPECTRIAN shall process all wafers and dies delivered to SMI
in accordance with the latest approved revision level of SPECTRIAN Specification
040160, "LDMOS Wafer Evaluation and Die Preparation Process," and the applicable
LDMOS Die Specifications (510XXX) except as modified by Section 11.3 of the
Agreement.

               11.3 SPECTRIAN will perform DC testing only on wafer and die
delivered to SMI in accordance with the requirements of 040160 and the
applicable 510XXX documents. SMI will perform all RF device evaluation assembly
and test for wafer qualification. All references to device builds for evaluation
sample testing, and qualification noted in 040160 and 510XXX documents are not
applicable to SPECTRIAN.

                                      -5-
<PAGE>   6
               SPECTRIAN warranties that [***] of the die from each wafer
delivered to SMI, when packaged into finished devices, will yield transistors
that comply with the applicable [***] transistor document. In the event a wafer
does not comply with this requirement, SMI will advise SPECTRIAN immediately,
but in no case later than [***] business days after receipt thereof by SMI, that
a wafer(s) has failed to comply with the performance and yield requirements of
paragraph 11.3. An engineering review meeting will be convened, attended by the
engineering representatives of both companies to review wafer data, and set a
corrective action plan for any failed wafers. After discussions regarding the
failed wafers have been completed, SMI, at its option and with advanced
notification to SPECTRIAN, shall return the wafer(s) for credit or replacement
or another agreed upon solution.

               11.4 SMI and/or its appointed customers shall be entitled upon
any reasonably written request and during normal business hours, and at its sole
expense, to witness inspection and testing of all wafers manufactured by
SPECTRIAN for SMI under this Agreement and to audit the SPECTRIAN quality
control system to monitor the quality of wafers manufactured. If corrective
actions require follow-up, additional, directly related audits are permitted,
SMI personnel, in conducting such inspections or audits, shall be bound by
SPECTRIAN rules at its plants respecting visits by outside personnel.

               11.5 SPECTRIAN shall keep, and provide reasonable access to SMI,
all SPECTRIAN test, inspection, processing, and full tracing of all wafers, from
fabrication to shipment, including scraps, normally maintained for a wafer lot
for each lot of wafers processed, on the same terms as it handles its standard
production records for other customers. SPECTRIAN shall not destroy records
pertaining to the wafers within 18 months of their creation and without first
giving SMI thirty (30) days written notice of such intended destruction and, the
right to obtain copies of such records for SMI own files and at SMI own expense.

               11.6 Should SPECTRIAN discover or be informed about a condition
that may affect the quality or reliability of wafers in process or shipped to
SMI, SPECTRIAN will inform SMI immediately and present to SMI all pertinent
data.

        12. Inspection.

               12.1 SMI shall conduct its own inspection of shipped wafers,
transistors or parts in accordance with the Exhibit A wafer, transistor and
capacitor specifications within thirty (30) business days after receipt thereof
by SMI. If any wafers, transistors or capacitors shipped by SPECTRIAN do not
meet specifications upon such inspection, SMI shall immediately notify SPECTRIAN
in writing of the rejection of such shipment, and the specific defect or
deficiency identified by the inspection. SMI shall hold such materials in a safe
and secure facility and make them available for inspection by SPECTRIAN, subject
to Section 12.5.

               12.2 If appropriate, SPECTRIAN may direct SMI to return such
defective materials to SPECTRIAN for further inspection, testing or other
procedures. Any such direction shall be accomplished by an SPECTRIAN Return
Material Authorization ("RMA"), including a specific tracer number to be
prominently displayed on the shipping container for such returned materials.
Upon issuance of an RMA, SMI shall promptly ship such materials together with
all

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.

                                      -6-
<PAGE>   7

relevant data from the SMI inspection to the designated SPECTRIAN facility,
freight and insurance prepaid, in the original shipping container or containers
of equivalent protective constitution.

               12.3 SMI may return such wafers, transistors or parts hereunder
for a credit and may recover its return shipping and insurance expenses from
SPECTRIAN if, and only if, defects in such materials actually exist as indicated
in the SMI rejection notice and were not caused by SMI own misuse, unauthorized
modifications, neglect, improper testing, attempts to repair, or by accident,
fire or other hazard, while such materials were in the possession or control of
SMI.

               12.4 SPECTRIAN and SMI acknowledge that some wafers or parts
which do not meet Wafer Specifications and/or are broken may nevertheless still
be expected to yield a functional and reliable product. If SMI elects to
purchase such below-specification wafers or parts, SMI shall be entitled to a
partial credit against the SPECTRIAN invoice in an amount as may be reasonably
agreed upon in writing by SMI and SPECTRIAN. If SMI and SPECTRIAN fail to agree
upon a partial credit amount, then the below-specification wafers or parts shall
be returned to SPECTRIAN at SPECTRIAN's expense.

               12.5 SMI and SPECTRIAN agree that conformance to the
specifications within this document does not necessarily indicate the wafers are
free of defects in material and/or workmanship, and that subsequent processing
or testing may uncover such defects in material and/or workmanship. Warranty
claims of such nature shall be made by SMI no later than 30 working days after
the first indication of a potential problem to SMI, and SMI and SPECTRIAN agree
to use their best efforts to correct such defects and provide each other with a
reasonable amount of data or information to effect a cure.

               12.6 Any other provision of this Section 12 to the contrary
notwithstanding, no claim by SMI with respect to wafers, parts or services
delivered to SMI under this Agreement shall be greater in amount than the
purchase price of the order in respect of which damages are claimed. IN NO EVENT
SHALL SPECTRIAN BE LIABLE FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT OR SPECIAL
DAMAGES, HOWEVER CAUSED, WITH REGARD TO ANY WAFERS, PARTS OR SERVICES DELIVERED
HEREUNDER. REGARDLESS OF WHETHER SPECTRIAN HAS BEEN INFORMED OF THE POSSIBILITY
OF SUCH DAMAGES OR NOT.

        13. Delivery Quantities.

               13.1 Delivery quantities will match with ordered quantities as
closely as possible; [***]

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.

                                      -7-
<PAGE>   8

        14. Confidentiality.

               14.1 Each party acknowledges that the information disclosed in
connection with any transactions contemplated hereunder will contain the
Confidential Information and trade secrets of the disclosing party, and will
remain the property of the disclosing party ("Confidential Information"). A
party receiving any Confidential Information of the other party shall take all
reasonable measures to keep and hold any such Confidential Information of the
other party in strict confidence as it would its own Confidential Information
and shall not disclose such Confidential Information of the other party to any
person, firm or corporation without the prior written consent of the other
party. A party receiving Confidential Information of the other party shall not,
except as may be authorized hereafter in writing by the disclosing party, use
any Confidential Information of the other party for any purpose not stated in
this Agreement.

               14.2 A party receiving Confidential Information of the other
party shall limit dissemination of and access to any Confidential Information of
the other party to those employees or consultants of the receiving party who
have a good faith need for such access to effectuate the purpose of this
Agreement and who have executed a standard non-disclosure agreement with the
receiving party.

               14.3 The obligations of the receiving party described in this
Section shall survive termination or expiration of this Agreement and shall
continue in full force and effect with respect to any information as long as it
remains Confidential Information under this Section 14.

               14.4 A party receiving Confidential Information of the other
party may disclose such information to subcontractors upon the prior written
approval of the party disclosing the Confidential Information if such disclosure
is necessary to perform the receiving party's duties under this Agreement, and
such approval shall not be unreasonably withheld. The receiving party shall
cause its permitted subcontractors to sign a confidentiality agreement with
substantially the same terms and conditions of this Section prior to disclosing
Confidential Information of the other party to such subcontractors.

               14.5 Neither party shall have a Confidential Information
obligation to the other party with respect to any information of the other party
or any portion thereof which is:

                      (a) already known to the receiving party at the time of
receiving same as shown by the receiving party's files and records in existence
at the time of disclosure;

                      (b) or hereafter becomes publicly known through no
wrongful act of the receiving party;

                      (c) rightfully received from a third party without
restriction on disclosure and without breach of this Agreement;

                      (d) now or hereafter independently developed by the
receiving party and without reliance in any degree upon any Confidential
Information of the other party;

                                      -8-
<PAGE>   9

                      (e) furnished by the disclosing party to a third party
without any restriction upon disclosure comparable to that set forth in this
Agreement; or

                      (f) revealed pursuant to a requirement of a governmental
agency or law, provided that the receiving party provides prompt written notice
of such requirement or law so as to afford the disclosing party an opportunity
to intervene and oppose disclosure.

               14.6 The parties agree that any material breach of Section 14
will cause irreparable injury and that injunctive relief in a court of competent
jurisdiction will be appropriate to prevent either an initial or continuing
breach of such nondisclosure and confidentiality provisions herein in addition
to any other relief to which the owner of such Confidential Information may be
entitled.

        15. Term.

               15.1 This Agreement may be terminated by SMI or SPECTRIAN upon
written notice to the other party:

                      (a) in the event the other party files a petition in
bankruptcy, or in the event all or part of the other party's assets are assigned
to a trustee or receiver, or if an involuntary petition in bankruptcy is filed
by a third party and the other party does not resolve such petition in its favor
within sixty (60) days after filing and notice thereof;

                      (b) in the event of a substantial breach of a material
term of this Agreement not remedied by the other party in breach within thirty
(30) days after receipt of written notice by the terminating party specifying
such breach and requesting that it be remedied; and

                      (c) immediately for any violations of Section 14.

               a. IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY LOST PROFITS
OR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, OR SPECIAL DAMAGES, HOWEVER CAUSED,
AND ON ANY THEORY OF LIABILITY, ARISING OUT OF THE TERMINATION OF THIS
AGREEMENT.

               b. SPECTRIAN shall not be liable for any damages whatsoever
caused by SMI products, due to design, packaging and testing.

               15.4 This agreement shall be in effect for 60 months and shall be
self renewing on the anniversary of this Agreement thereafter unless terminated
by either party at least 180 days prior to such renewal. Should SPECTRIAN decide
to not renew this agreement the discontinuation of product clause (Section 10.0)
becomes effective.

        16. Infringement.

               16.1 SPECTRIAN warrants to SMI that SPECTRIAN owns the know-how,
copyrights, mask work rights, and other intellectual rights solely to enable
SPECTRIAN to produce the wafers, transistors or parts for SMI lawfully.
SPECTRIAN hereby indemnifies and holds SMI and its directors, officers,
employees and agents harmless from any claim, suit or other liability

                                      -9-
<PAGE>   10

(including reasonable attorneys' fees and costs) arising out of or resulting
from a material breach of the foregoing warranty.

               16.2 SMI warrants to SPECTRIAN that SMI owns, or otherwise has
the right to use on behalf of SPECTRIAN all applicable intellectual property
rights to the manufacturing processes not otherwise licensed to SMI by SPECTRIAN
which will be used by SPECTRIAN to produce the wafers or parts. SMI hereby
indemnifies and holds SPECTRIAN and its directors, officers, employees and
agents harmless from any claim, suit or other liability (including reasonable
attorneys' fees and costs) arising out of or resulting from a material breach of
the foregoing warranty.

               16.3 In the event of the institution of any suit or claim against
an indemnified party alleging that SPECTRIAN's manufacture of the wafers or
parts violates any circuit design patent or mask work, manufacturing process
patent, or other circuit design or manufacturing process proprietary right of a
third party recognized under the laws of the United States of America
(hereinafter "Third Party Rights"), or shall become the subject of any claim for
violation of Third Party Rights, the indemnified party shall promptly notify the
indemnifying party of such suit or claim and provide reasonable details thereof.
Failure to give such notice, if it materially impairs the ability of the
indemnifying party to defend against such suit or claim, shall terminate any
duty of indemnification under this Section.

               16.4 The indemnifying party shall have sole control of any action
or settlement negotiations relating to any such suit or claim, and the
indemnified party shall render all cooperation reasonably requested by the
indemnifying party in defense of such suit or claim, provided that the
indemnified party may retain its own counsel at its own expense. The indemnified
party shall not settle or attempt to settle any such suit or claim without the
express written consent of the indemnifying party.

               16.5 In addition to its duty of indemnification hereunder, the
indemnifying party may, at its sole discretion and expense:

                      (a) alter or change the circuit design or manufacturing
process, as may be the case, so as to make said design or process non-infringing
of any Third Party Right; or

                      (b) obtain permission from the affected third party to use
the Third Party right, it being the intention of both parties to continue the
performance of this Agreement if commercially reasonable to do so.

                      If neither of these methods is appropriate to eliminate
the infringement of the Third Party Right, the indemnifying party at its sole
discretion may terminate this Agreement or withdraw the infringing products
without any additional obligation or liability to the indemnified party, for
lost opportunity or profits or otherwise, due to such termination.

        17. Notices.

               17.1 Any and all notices or other communications required or
permitted by this Agreement or by law to be served on or given to either party
hereto by the other party shall be in writing and shall be deemed duly served
and given when personally delivered to either of the parties

                                      -10-
<PAGE>   11

to whom it is directed, or in lieu of such personal service, on the same day of
transmission by confirmed facsimile or seven (7) days after deposit in the mail,
first class international air mail postage prepaid, or two (2) business days
after being sent by overseas courier, addressed to:

            SMI Microdevices Inc.               SPECTRIAN, CORPORATION.
            522 Almanor Avenue                  Semiconductor Division
            Sunnyvale, CA 94086                 350 West Java Drive
            Attn. of: Gerald L. Quinnell        Sunnyvale, CA 94089
                                                Attn. of:  Chris Tubis

                      Either party may change the addresses above upon notice
duly given in writing to the other party.

        18. Arbitration.

               18.1 Except for any claim based upon an alleged or actual
violation of Section 14 above with respect to confidentiality and
non-disclosure, any dispute relating to the interpretation or performance of
this Agreement or the grounds for the termination thereof shall be resolved at
the request of either party through arbitration as set forth herein. Such
arbitration shall be conducted by one (1) arbitrator who has reasonable
technical knowledge of and experience in the semiconductor industry, chosen and
agreed upon by the parties.

               18.2 Arbitration shall be conducted in Sunnyvale, California,
USA, under the Commercial Arbitration Rules of the American Arbitration
Association (the "AAA"), except as superseded by the provisions of this Section,
or such other rules as may be agreed upon by the parties. The parties shall be
entitled to all discovery permitted under Section 1283.05 of the California Code
of Civil Procedure, with all such discovery to be completed within ninety (90)
days of the commencement of the arbitration. Upon completion of the arbitration
hearing, the arbitrator shall promptly render the decision and award, which
shall be in writing and which shall state the reasons for the conclusions
reached.

               18.3 The arbitrator shall have the power to render any award for
ordinary damages or injunctive relief but may not award punitive damages. If
judicial enforcement or review of such arbitration award is sought by either
party, judgement may be entered upon such award in any court of competent
jurisdiction in the United States.

               18.4 The prevailing party in any such judicial enforcement,
arbitration or review proceeding or in any other legal proceeding relating to
the interpretation or performance of this Agreement or the grounds for
termination thereof shall be entitled to its reasonable attorneys' fees and
related other costs (including the costs for the arbitrator and the fees of any
interpreters or translators) in addition to any other amount of recovery ordered
by such court. For purposes of this Section, a "prevailing party" shall be that
party which recovers more than one-half (1/2) of the amount set forth in its
claim in the arbitration or which defeats the other party's claim by more than
one-half, or which achieves a comparable result in respect of injunctive relief.

                                      -11-
<PAGE>   12

        19. Miscellaneous.

               19.1 This document constitutes the entire agreement of SMI and
SPECTRIAN with regard to the subject matter hereof and supersedes all prior
negotiations and agreements whether written or oral. The executed version of
this Agreement and of any other documents prepared by the parties under this
Agreement shall be controlling for all purposes.

               19.2 This Agreement may be amended only by a written document
executed by authorized representatives of SMI and SPECTRIAN.

               19.3 No right may be assigned, and no duty may be delegated, by
either party under this Agreement except upon the written consent of the other
party, and any attempted assignment and delegation without such consent shall be
void.

               19.4 Notwithstanding the foregoing, however, either party shall
be entitled to assign this Agreement, and all rights and obligations hereunder,
to a wholly-owned subsidiary or to a successor to all or substantially all of
its assets, whether by sale, merger, or otherwise, provided that either party
indicating such assignment shall provide the other party with at least thirty
(30) days prior written notice and cause such assignee to be bound by this
Agreement. In the event of a major change of ownership, either party shall have
the right to terminate the Agreement with at least 60 days prior written notice.
This agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective representatives, heirs, administrators,
successors and permitted assigns except as otherwise provided herein.

               19.5 The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.

               19.6 Except for the duty of payment for goods and services
previously supplied, neither party shall be responsible or liable to the other
party for non-performance or delay in performance of any terms or conditions of
this Agreement due to acts of God, acts of governments, wars, riots, strikes or
other labor disputes, shortages of labor or materials, or other causes beyond
the reasonable control of the non-performing or delayed party, provided,
however, non-performance or delay in excess of one hundred eighty (180) days
shall constitute cause for termination of this Agreement by either party.

               19.7 This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but such counterparts
together shall constitute only one and the same instrument.

               19.8 Any waiver (express or implied) by either party of any
breach of this agreement shall not constitute a waiver of any other or
subsequent breach.

               19.9 In the event any provision of this Agreement is held to be
invalid or unenforceable, the valid or enforceable portion thereof and the
remaining provisions of this Agreement will remain in full force and effect.

                                      -12-
<PAGE>   13

               19.10 Each party hereto is an independent contractor of the
other, and neither shall be deemed an employee, agent, partner or joint venturer
of the other. Neither party shall make any commitment, by contract or otherwise,
binding upon the other nor represent that it has any authority to do so.

               19.11 Each party shall obey all applicable laws and regulations
in the performance of its respective duties and tasks under this Agreement and
shall use its best efforts to assist the other party to do likewise.

               19.12 Each party shall designate a single management
representative who shall be the primary point of contact for that party in its
relations with the other party hereunder, and each party may change its
representative from time to time upon prior written notice to the other party.
Initially, the SMI representative shall be Gerald L. Quinnell and the SPECTRIAN
representative shall be Chris Tubis.

               19.13 This Agreement shall be governed by the laws of the state
of California without regard to its conflicts of laws principles.

                                      -13-
<PAGE>   14

        IN WITNESS WHEREOF the parties have caused this agreement to be executed
by their respective duly authorized representatives.

FOR STANFORD MICRODEVICES, INC.          FOR SPECTRIAN CORPORATION

/s/ Gerald L. Quinnell                   /s/ Chris Tubis
-------------------------------          ---------------------------------
(signature)                              (signature)

Gerald L. Quinnell                       Chris Tubis

Chief Operating Officer                  President
STANFORD MICRODEVICES, INC.              Semiconductor Division
                                         SPECTRIAN CORPORATION

Nov 8, 1999                              5th Nov 1999
-------------------------------          ---------------------------------
(date)                                   (date)

                                      -14-
<PAGE>   15

                                    EXHIBIT A

                             PRODUCT SPECIFICATIONS

                                     [***]

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.
<PAGE>   16

                                     [***]

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with

                                      -2-
<PAGE>   17

                                    EXHIBIT B

                                     PRICING

<TABLE>
<CAPTION>
---------------------------------------------        -----------------------------------------------
                TRANSISTORS                                            WAFERS/DIE
---------------------------------------------        -----------------------------------------------
DEVICE                         PRICE (EACH)          TYPE                            PRICE (EACH)
---------------------------------------------        -----------------------------------------------
<S>                            <C>                   <C>                       <C>
[***]                          [***]                 [***]                          [***]
---------------------------------------------        -----------------------------------------------

                                                                             CAPACITORS
                                                     -----------------------------------------------
                                                     TYPE                            PRICE/WAFER
                                                     -----------------------------------------------
                                                     [***]                          [***]
                                                     -----------------------------------------------
</TABLE>

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.
<PAGE>   18

                                    EXHIBIT C

                           MAJOR CHANGE CLASSIFICATION

The following are considered major changes and require SMI notification prior to
implementation.

WAFER FABRICATION

[***]

PACKAGING

[***]

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.
<PAGE>   19

                                    EXHIBIT D

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
                          LDMOS TRANSISTOR ASSEMBLY
-----------------------------------------------------------------------------------------------
TRANSISTOR MODEL                  DEVICE P/N                     ASSEMBLY SPECIFICATION
-----------------------------------------------------------------------------------------------
<S>                               <C>                            <C>
[***]                             [***]                          [***]
-----------------------------------------------------------------------------------------------
</TABLE>

Specifications 510XXX"

[***] Certain information on this page has been omitted and filed separately
      with the Commission. Confidential treatment has been requested with
      respect to the omitted portions.

<PAGE>   20

                                    EXHIBIT E

INTELLECTUAL PROPERTY FOR ASSEMBLY/TEST OF SPECTRIAN DEVICES USING SPECTRIAN
DICE

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