<PAGE>   1
                                                                   EXHIBIT 10.47








                       Dated this 21st day of March, 2000





                                     Between



                    CHARTERED SEMICONDUCTOR MANUFACTURING LTD



                                       And



                          ST ASSEMBLY TEST SERVICES LTD



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

                               TURNKEY SUBCONTRACT
                                    AGREEMENT
                                       FOR
                    SORT, ASSEMBLY AND/OR FINAL TEST SERVICES


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





                          CHARTERED-STATS CONFIDENTIAL
<PAGE>   2
                                    CONTENTS

<TABLE>
<CAPTION>
Clause                                                                      Page
------                                                                      ----
<S>                                                                         <C>
1.   DEFINITIONS ..........................................................   1

2.   END CUSTOMER .........................................................   2

3.   SORT, ASSEMBLY AND FINAL TEST SERVICES ...............................   3

4.   PLANNING .............................................................   4

5.   PURCHASE ORDERS ......................................................   4

6.   PRICING AND PAYMENT TERMS ............................................   5

7.   QUALITY CONTROL AND INSPECTION .......................................   5

8.   PERFORMANCE ..........................................................   5

9.   SPECIFICATION CONTROL ................................................   6

10.  PRODUCTION HALTS .....................................................   6

11.  PROCEDURE FOR CUSTOMER RETURN ........................................   6

12.  DELIVERY .............................................................   7

13.  TERM AND TERMINATION .................................................   8

14.  FORCE MAJEURE ........................................................   8

15.  INDEMNITY ............................................................   9

16.  LIMITATION OF LIABILITY ..............................................  10

17.  CONFIDENTIALITY ......................................................  10

18.  APPLICABILITY OF AGREEMENT TO AFFILIATE ..............................  11

19.  NOTICES ..............................................................  11

20.  WAIVER AND REMEDIES ..................................................  12

21.  SEVERANCE ............................................................  12

22.  ENTIRE AGREEMENT .....................................................  12

23.  NO ASSIGNMENT OR SUB-CONTRACTING .....................................  13

24.  GOVERNING LAW ........................................................  13

APPENDIX A - SPECIFICATIONS RELATING TO THE SORT, ASSEMBLY AND/OR
FINAL TEST OF WAFERS AND/OR UNITS .........................................  14
</TABLE>



                          CHARTERED-STATS CONFIDENTIAL

<PAGE>   3
THIS TURNKEY SUBCONTRACT AGREEMENT is made this 21st day of March, 2000 (the
'Effective Date') by and between:-

(1)     CHARTERED SEMICONDUCTOR MANUFACTURING LTD, a company incorporated in
        Singapore, with its principal place of business at 60 Woodlands
        Industrial Park D, Street 2, Singapore 738406 (hereinafter referred to
        as 'Chartered'); and

(2)     ST ASSEMBLY TEST SERVICES LTD, a company incorporated in Singapore, with
        its principal place of business at 5 Yishun Street 23, Singapore 768442
        (hereinafter referred to as 'STATS').

WHEREAS

(A)    Chartered is desirous of manufacturing Wafers and/or Units (as
       hereinafter defined) for End Customers (as hereinafter defined) on a
       sorted, assembled and/or final tested basis. This will involve the
       manufacture of Wafers by Chartered and the subsequent subcontracting of
       the sort, assembly and/or final test services related to Wafers and/or
       Units to a third-party;

(B)    STATS is in the business of performing sort, assembly and final test
       services related to Wafers and/or Units; and

(C)    Chartered and STATS desire to enter into an agreement for the purpose of
       having STATS perform the sort, assembly and/or final test services for
       Wafers and/or Units.

NOW IT IS HEREBY AGREED as follows :-


1.      DEFINITIONS

1.1     In this Agreement, unless otherwise defined or the context otherwise
        requires, the following words and expressions shall bear the following
        meanings:-

        'Affiliate' means Chartered's joint venture fabs, Silicon Manufacturing
        Partners Pte Ltd and Chartered Silicon Partners Pte Ltd, and such other
        corporation that may be agreed to by the Parties from time to time.

        'End Customer' means Chartered's customer who has appointed Chartered as
        manufacturer of Wafers and/or Units on a sorted, assembled and/or final
        tested basis.

        'Parties' mean collectively Chartered and STATS, and 'Party' shall mean
        any one of them.

        'Products' mean End Customer's integrated circuit products identified by
        Chartered and/or End Customer's product part numbers.



                                       1
<PAGE>   4

        'Technical Matters' mean all matters related to (a) transfer, evaluation
        and release of test programs for sort and/or final test, (b) probecard
        and/or loadboard configuration; (c) determination of good die per Wafer
        ('gdpw'), net die per Wafer ('ndpw'), sort test time and final test
        time; (d) tester platform and package information; (e) test and/or
        process flow requirements; (f) bonding diagram, marking instructions,
        assembly process requirements and qualification requirements and bill of
        materials, (g) quality and reliability requirements; and (h) such other
        matters that the Parties may mutually designate in writing from time to
        time as 'Technical Matters'.

        'Units' mean finished die in packaged form.

        'Wafer' means 150mm and/or 200mm silicon wafers manufactured by
        Chartered and containing finished die for the Products.

        'Works' mean the sort, assembly and/or final test services to be
        performed by STATS with respect to the Wafers and/or Units, and/or such
        other services and activities which STATS shall provide to Chartered,
        including without limitation, shipping services to End Customer.

1.2     References to recitals, clauses and appendices are references to
        recitals, clauses and appendices of this Agreement.

1.3     The headings in this Agreement are inserted for convenience only and
        shall be ignored in the interpretation of this Agreement.

1.4     Unless the context otherwise requires, words denoting the singular
        number shall include the plural and vice versa, words importing the
        masculine gender shall include the feminine gender and words importing a
        person shall include a company or corporation and vice versa.


2.      END CUSTOMER

2.1     Where expedient, Chartered may authorise STATS to communicate directly
        with End Customer on any Technical Matters. In this regard, STATS shall
        provide regular updates to Chartered regarding the exchange of
        information including copying (when requested by Chartered) of all
        correspondence between STATS and End Customer to Chartered. For the
        purposes of this Agreement, where the communication between Chartered
        and STATS is related to Technical Matters, references to 'Chartered'
        shall, where the context so requires, also include End Customer. All
        communications between Chartered, STATS and End Customer shall comply
        with Chartered's Turnkey Business Procedure BX-005 paragraph 7.3.1.

2.2     STATS shall have no authority nor shall STATS hold out to End Customer
        as having the authority or right to assume, create or undertake any
        obligation of any kind whatsoever, expressed or implied, on behalf of or
        in the name of Chartered, without the prior written consent of
        Chartered.



                                       2
<PAGE>   5

2.3     Chartered may consign equipment for the Works, or where mutually agreed
        in writing procure the direct consignment of End Customer's equipment,
        to STATS for use exclusively in performing the Works for End Customer.
        With respect to STATS owned equipment, STATS shall keep Chartered
        informed and updated on any equipment upgrades.


3.      SORT, ASSEMBLY AND FINAL TEST SERVICES

3.1     STATS shall undertake the sort, assembly and/or final test services in
        accordance with the terms of this Agreement.

3.2     Chartered shall provide at its own expense requisite quantities of
        probecards and loadboard per project. STATS shall be responsible for the
        maintenance of and damage to the probecards and loadboards.

3.3     Chartered shall ensure that End Customer supplies to STATS all test
        programs to be used in the Works (the 'Test Programs'), including the
        necessary correlation units for correlation, including probecard wafers
        and golden wafers. STATS may initiate and modify in any manner such Test
        Programs without the prior written consent of Chartered, provided STATS
        shall not implement such modified Test Program without Chartered's prior
        written consent. STATS shall, at the written request of Chartered,
        develop Test Programs or undertake Test Program conversion on such terms
        and conditions to be mutually agreed.

3.4     Chartered shall approve and bear the cost of all other non-recurring
        engineering charges to be incurred in the Works. With respect to
        engineering time charge, Chartered shall pay the agreed rate for work
        performed after office hours, on weekends and on public holidays by
        STATS personnel on the Works in accordance with the price agreement
        between Chartered and STATS (and as amended from time to time by the
        Parties).

3.5     STATS shall be responsible for the maintenance of or damage to goods
        consigned by End Customer to STATS (the 'Consigned Goods'), save that
        STATS shall not be responsible for damage to the Consigned Goods due to
        fair wear and tear and acts of God or arising out of the negligence,
        default, acts or omissions to act of Chartered's employees, agents or
        contractors. For the purposes of this Agreement, Consigned Goods shall
        mean testers, correlation wafers, golden wafer, golden units, probecard
        wafers and software.

3.6     Chartered shall obtain and maintain liability insurance and insurance
        against loss or damage (including, without limitation, loss by fire,
        theft and such other risks of loss as are customarily insured against)
        to the Wafers and/or Units (including tested and untested Wafers and/or
        Units, and packaged and unpackaged Wafers and/or Units) and all
        loadboards, probecards, and Consigned Goods purchased or procured by
        Chartered for the performance of the Works. Such insurance shall
        (subject to Clause 16.1) be in such amounts, in such form and with such
        insurers as Chartered deems appropriate.



                                       3
<PAGE>   6
4.      PLANNING

4.1     Chartered shall provide to STATS not later than the 20th day of each
        calendar month, its rolling 6-monthly forecast of its monthly volume
        requirements for the performance of the Works for each Product.
        Chartered shall not be liable for any direct or indirect materials
        incurred by STATS in reliance of the said forecasts if Chartered's
        confirmed orders are less than Chartered's forecast orders for the
        Works, provided that Chartered shall only be liable for materials unique
        to End Customer's requirements based on Chartered's forecast for the
        Works up to a maximum of 1 month plus lead time for the procurement of
        the unique material. STATS shall declare all unique materials and lead
        time to Chartered, and the said lead time shall be mutually agreed to by
        the Parties.

4.2     STATS shall use best efforts to meet Chartered's forecast volumes. STATS
        shall keep Chartered informed of its capacity situation and provide
        Chartered with sufficient pre-warning of any capacity issues that STATS
        may experience. Chartered agrees that it shall work with STATS in the
        spirit of cooperation to develop the turnkey business for the mutual
        benefit of both Parties.


5.      PURCHASE ORDERS

5.1     Chartered may furnish STATS with blanket purchase orders or individual
        purchase orders for the Works.

5.2     All purchase orders issued by Chartered shall reference this Agreement.
        The terms and conditions of this Agreement shall exclusively govern the
        Works and shall override any conflicting, amending and/or additional
        terms contained in STATS' quotation and/or acceptance documents. No
        variation or addition to the terms and conditions contained in this
        Agreement shall be binding unless agreed in writing between the
        authorised representatives of the Parties.

5.3     Chartered's purchase order shall contain such information and
        requirements to be mutually agreed between the Parties.

5.4     In order for Chartered to place purchase orders with STATS, STATS shall
        respond to Chartered in accordance with the following time frames:

        (a)    Works Quote          within 24 hours of Chartered's RFQ for
                                    Works, provided all relevant information is
                                    given to STATS in accordance with BX-005;

        (b)    NRE Quote            within 48 hours of Chartered's RFQ for NRE;

        (c)    Delivery Commit      within 24 hours of Chartered's schedule
                                    request for orders within the forecasted
                                    volume, and within 48 hours of Chartered's
                                    schedule request for orders in excess of
                                    forecasted volumes.



                                       4
<PAGE>   7


6.      PRICING AND PAYMENT TERMS

6.1     The fees for the Works charged to Chartered shall be in accordance with
        the terms of any price schedule agreed to by the Parties from time to
        time for the Wafers and/or Units (the 'Agreed Price Schedule'). However
        in special circumstances related to an extra-ordinary End Customer
        requirement Chartered and STATS shall review the Agreed Price Schedule
        for that End Customer.

6.2     Unless otherwise set out in Chartered's applicable purchase order,
        payment for the Works shall be made by Chartered in United States
        dollars within 30 days from the date of the acceptance of the Works by
        Chartered. Chartered shall make payment by telegraphic transfer to an
        account nominated by STATS, or such other method requested by STATS.

6.3     All invoices issued by STATS for the Works shall identify the Wafers
        and/or Units and the relevant Chartered purchase order number, Product
        part number, description of items and quantity of items shipped and the
        type of services performed by STATS.

6.4     Chartered and STATS shall not disclose the terms of this Agreement, the
        Agreed Price Schedule, STATS quotation to Chartered or Chartered
        purchase order to STATS, to End Customer.


7.      QUALITY CONTROL AND INSPECTION

        In order to control and ensure quality assurance, Chartered will have
        the right at all reasonable times and on reasonable notice, either by
        itself or through its auditors, to inspect the assembly lines,
        warehouse, facilities, equipment, materials, data, billings and systems
        connected with the Works, subject always to the confidentiality
        undertakings in Clause 17. STATS undertakes to make available all
        documentation and grant Chartered all necessary access rights for
        Chartered or its auditors to conduct audit as permitted under this
        Clause 7.


8.      PERFORMANCE

8.1     STATS shall implement a continuous improvement program where STATS will
        work to reduce cycle time, reaching mutually agreed performance
        benchmarks.

8.2     STATS shall implement a continuous improvement program where STATS will
        work with Chartered on an ongoing basis to reduce costs against an
        agreed cost down target. Targets will be set based on cost analysis
        received and final pricing agreed between the Parties.



                                       5
<PAGE>   8
9.      SPECIFICATION CONTROL

9.1     Notwithstanding that Chartered will be referencing STATS standard
        manufacturing and quality flows and procedures, STATS shall at the same
        time be required to comply with Chartered standard operating
        specifications relating to back-end services and subcontractors. The
        list of applicable STATS specifications and Chartered specifications are
        set out in Appendix A hereto. In addition, STATS shall comply with such
        other specifications (including End Customer specifications and
        procedures) that Chartered may issue from time to time.


10.     PRODUCTION HALTS

10.1    Chartered may at any time request STATS to halt the Works still
        in-process as a result of reliability and quality issues, and STATS
        shall effect stoppage immediately. The Works shall remain on hold
        pending written directions from Chartered.

10.2    If Chartered decides to cancel any part of the halted Works, Chartered
        shall pay to STATS the cost of the work-in-progress only, as at the date
        of Chartered's written notice to halt the Works. The cost of the
        work-in-progress arising from the halt shall be borne by STATS if the
        Works halt was due to quality and reliability defects caused by STATS,
        without prejudice to Chartered's right to claim against STATS for any
        defects in Wafers and/or Units under Clause 11.

10.3    STATS shall, if commercially feasible, re-start the Works as soon as
        possible after receipt of Chartered's written request. The cost of
        re-start shall be borne by STATS if the Works halt was due to quality
        and reliability defects caused by STATS, without prejudice to
        Chartered's right to claim against STATS for any defects in Wafers
        and/or Units under Clause 11.


11.     PROCEDURE FOR CUSTOMER RETURN

11.1    STATS warrants that the Works performed and the Wafers and/or Units
        supplied hereunder shall conform to Chartered's specifications and will
        be free from any defects in workmanship, materials and manufacture for a
        period of 90 days from the date of acceptance of the Wafers and/or Units
        by Chartered. STATS shall work with End Customer and/or Chartered to
        resolve any defects that occur after the 90-day warranty period.

11.2    STATS shall be under no liability for probe yield in the Wafers or final
        test yield in the Units, unless the loss in yield is due to the Works
        performed by STATS.

11.3    With respect to Wafers' and/or Units returned with respect to this
        Clause 11, STATS shall at STATS' sole option, and at STATS' sole expense
        and with top



                                       6
<PAGE>   9

        priority, replace, repair, retest or rework the subject Wafers and/or
        Units. Such replaced, repaired, retested or reworked Wafers and/or Units
        shall be delivered Exworks (STATS' factory in Singapore) (Incoterms
        2000) or such other delivery terms as may be specified by End Customer.

11.4    SUBJECT TO CLAUSE 16, THE FOREGOING STATES STATS' ENTIRE LIABILITY,
        WHETHER IN CONTRACT, TORT OR OTHERWISE, FOR ALL CLAIMS BASED ON FAILURE
        OR DEFECTS IN WAFERS AND/OR UNITS. THE EXPRESS TERMS OF THIS AGREEMENT
        ARE IN LIEU OF ALL WARRANTIES, CONDITIONS, TERMS, UNDERTAKINGS AND
        OBLIGATIONS IMPLIED BY STATUTE, COMMON LAW, CUSTOM, TRADE USAGE, COURSE
        OF DEALING OR OTHERWISE, ALL OF WHICH ARE HEREBY EXPRESSLY EXCLUDED TO
        THE FULLEST EXTENT PERMITTED BY LAW AND STATS SPECIFICALLY DISCLAIMS ANY
        WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.


12.     DELIVERY

12.1    Wafers shall be delivered by Chartered to STATS for the performance of
        the Works Exworks (STATS' factory in Singapore) (Incoterms 2000). Title
        to the Wafers and/or Units (including finished goods and
        work-in-progress) and equipment purchased or procured by Chartered for
        the performance of the Works, shall be vested in Chartered throughout
        the performance of the Works.

12.2    STATS shall strictly adhere to the cycle times that have been mutually
        agreed between the Parties, and good Wafers and/or Units and (if
        requested by Chartered or End Customer) reject Wafers and/or Units shall
        be delivered, Exworks (STATS' factory in Singapore) (Incoterms 2000).
        STATS shall immediately give Chartered written notice of any prospective
        failure to deliver within the Scheduled Delivery Date.

12.3    STATS shall deliver all quantities of Wafers and/or Units to Chartered
        and/or End Customer in STATS standard containers and packaging which
        comply with Chartered's specifications as notified by Chartered to STATS
        from time to time, with proper labels identifying the specific Product
        lot number and shall be accompanied by an invoice specifying the
        purchase order number, quantity and agreed processing documentation.
        STATS shall forward a copy of the bill of lading or the airway bill as
        soon as practicable to Chartered for the delivered Wafers and/or Units,
        and a monthly report furnishing the details of the month's shipment made
        to the End Customer, for GST billing purposes.

12.4    STATS shall not scrap any Wafers and/or Units without first seeking the
        prior written permission of Chartered.



                                       7
<PAGE>   10
13.     TERM AND TERMINATION

13.1    This Agreement shall commence on the Effective Date and shall continue
        for a period of 3 years therefrom and shall thereafter be automatically
        renewed annually, unless earlier terminated in the following events :-

        (a)  by agreement of the Parties;

        (b)  forthwith by either Party if the other commits any material breach
             of any term of this Agreement and which in the case of a breach
             capable of being remedied shall not have been remedied within 60
             days of a written request to remedy the same;

        (c)  at the option of either Party, in any of the following events:-

             (i)      the inability of the other Party to pay its debts in the
                      normal course of business; or

             (ii)     the other Party ceasing or threatening to cease wholly or
                      substantially to carry on its business, otherwise than for
                      the purpose of a reconstruction or amalgamation without
                      insolvency; or

             (iii)    any encumbrancer taking possession of or a receiver,
                      trustee or judicial manager being appointed over the whole
                      or any substantial part of the undertaking, property or
                      assets of the other Party; or

             (iv)     the making of an order by a court of competent
                      jurisdiction or the passing of a resolution for the
                      winding-up of the other Party or any company controlling
                      the other Party, otherwise than for the purpose of a
                      reconstruction or amalgamation without insolvency.

13.2    Termination of this Agreement pursuant to Clause 13.1 shall take effect
        immediately upon the issue of a written notice to that effect by the
        Party terminating the Agreement to the other. The termination of this
        Agreement however caused shall be without prejudice to any obligations
        or rights of either Party which have accrued prior to such termination
        and shall not affect any provision of this Agreement which is expressly
        or by implication provided to come into effect on or to continue in
        effect after such termination.


14.     FORCE MAJEURE

14.1    Each Party's obligations under this Agreement shall be suspended upon
        the occurrence of a force majeure event such as act of God, flood,
        earthquake, fire, explosion, act of government, war, civil commotion,
        insurrection, embargo,



                                       8
<PAGE>   11

        riots, lockouts, labour disputes affecting such Party, for such period
        as such force majeure event may subsist. Upon the occurrence of a force
        majeure event, the affected Party shall notify the other Party in
        writing of the same and shall by subsequent written notice after the
        cessation of such force majeure event inform the other Party of the date
        on which that Party's obligation under this Agreement shall be
        reinstated.

14.2    Notwithstanding anything in this Clause 14, upon the occurrence of a
        force majeure event affecting either Party, and such force majeure event
        continues for a period exceeding 6 consecutive months without a prospect
        of a cure of such event, the other Party shall have the option, in its
        sole discretion, to terminate this Agreement. Such termination shall
        take effect immediately upon the written notice to that effect from the
        other Party to the Party affected by the force majeure event.


15.     INDEMNITY

15.1    Chartered shall indemnify, hold harmless and defend STATS from and
        against any claim, suit, demand, or action alleging that the
        manufacture, sale, or other disposition of the Wafers and/or the Units
        or a process, design or Test Program licensed from or otherwise provided
        by Chartered or End Customer infringes a patent, copyright, trade
        secret, or any other proprietary right of any third-party, including,
        without limitation, any infringement based on specifications furnished
        by Chartered or End Customer or resulting from the use of any Test
        Program, equipment or process specified by Chartered or End Customer,
        and Chartered shall indemnify and hold harmless STATS against any and
        all direct losses, liabilities, damages, awards of settlement (including
        court costs) and expenses (including all reasonable attorney's fees,
        whether or not legal proceedings are commenced) arising from any such
        claim, suit, demand, or action.

15.2    STATS shall notify Chartered of any claim of infringement or of
        commencement of any suit, action, or proceedings against STATS (the
        'STATS Proceedings') alleging infringement of any intellectual property
        rights of any third-party by Chartered's Wafers and/or Units or a
        process or design licensed from or otherwise provided by Chartered or
        End Customer or the use of a Test program provided by Customer, promptly
        after receiving notice thereof and shall provide reasonable assistance
        to Chartered (at Chartered's expense) in connection with the defence
        thereof. Chartered shall have the right in its sole discretion and at
        its expense to assume full control of the defence and settlement of any
        such STATS Proceedings and in any and all negotiations with respect
        thereto.

15.3    STATS shall indemnify, hold harmless and defend Chartered from and
        against any claim, suit, demand, or action alleging that the Works or
        any part of the Works infringes a patent, copyright, trade secret, or
        any other proprietary right of any third-party, and STATS shall
        indemnify and hold harmless Chartered against any and all direct losses,
        liabilities, damages, awards of settlement (including court costs) and
        expenses (including all reasonable attorney's fees, whether or not legal
        proceedings are commenced) arising from any such claim, suit, demand, or
        action.



                                       9
<PAGE>   12

15.4    Chartered shall notify STATS of any claim of infringement or of
        commencement of any suit, action or proceedings (the 'Chartered
        Proceedings') alleging infringement of any intellectual property rights
        of any third-party by the Works or any part of the Works, promptly after
        receiving notice thereof and shall provide reasonable assistance to
        STATS (at STATS' expense) in connection with the defence thereof. STATS
        shall have the right in its sole discretion and at its expense to assume
        full control of the defence and settlement of any such Proceedings and
        in any and all negotiations with respect thereto.

15.5    SUBJECT TO CLAUSE 16, EITHER PARTY'S AGGREGATE CUMULATIVE LIABILITY TO
        THE OTHER PARTY ARISING OUT OF THE INDEMNIFICATION UNDER THIS CLAUSE 15
        SHALL NOT EXCEED THE TOTAL AMOUNT RECEIVED BY STATS FROM CHARTERED IN
        RESPECT OF THE PERFORMANCE OF THE WORKS BY STATS. THE FOREGOING STATES
        EACH PARTY'S ENTIRE LIABILITY AND OBLIGATION (EXPRESS, IMPLIED,
        STATUTORY OR OTHERWISE) WITH RESPECT TO INTELLECTUAL PROPERTY
        INFRINGEMENT OR CLAIMS THEREFOR REGARDING ANY PART OF THE WORKS
        PERFORMED PURSUANT TO THIS AGREEMENT.


16.     LIMITATION OF LIABILITY

16.1    STATS' liability to Chartered for Wafers or die destroyed or damaged by
        STATS shall not exceed 100% of the average selling price ('ASP') charged
        by STATS to Chartered for the Works rendered or to be rendered on the
        damaged or destroyed Wafers or die.

16.2    Save as provided in Clauses 16.1, the total liability of either Party on
        all claims of any kind, whether in contract, tort (including
        negligence), strict liability or otherwise (including as a result of
        intellectual property infringement) arising out of the performance or
        breach of this Agreement or use of the Wafers and/or Units or the
        performance of the Works shall not exceed the total amount received by
        STATS from Chartered in respect of the performance of the Works by
        STATS.

16.3    In no event shall either Party be liable to the other with respect to
        any subject matter of this Agreement under any contract, tort (including
        negligence), strict liability or other legal or equitable theory, for
        any incidental, consequential, special, exemplary or indirect damages of
        any sort even if such Party has been informed of the possibility of such
        damages.


17.     CONFIDENTIALITY

17.1    All Confidential Information shall be kept confidential by the recipient
        unless or until the recipient Party can reasonably demonstrate that any
        such Confidential Information is, or part of it is, in the public domain
        through no fault of its own, whereupon to the extent that it is in the
        public domain or is required to be disclosed by law this obligation
        shall cease. For the purposes of this Agreement,



                                       10
<PAGE>   13

        'Confidential Information' shall mean all communications between the
        Parties and/or between either Party and End Customer, and all
        information and other materials supplied to or received by either of
        them from the other or End Customer (a) prior to or on the date of this
        Agreement whether or not marked confidential; (b) after the date of this
        Agreement which is marked confidential with an appropriate legend,
        marking, stamp or other obvious written identification by the disclosing
        Party and/or End Customer, and (c) all information concerning the
        business transactions and the financial arrangements of the Parties
        and/or End Customer with any person with whom any of them is in a
        confidential relationship with regard to the matter in question coming
        to the knowledge of the recipient.

17.2    The Parties shall take all reasonable steps to minimise the risk of
        disclosure of Confidential Information, by ensuring that only they
        themselves and such of their employees and directors whose duties will
        require them to possess any of such information shall have access
        thereto, and will be instructed to treat the same as confidential.

17.3    The obligation contained in this Clause 17 shall endure, even after the
        termination of this Agreement, for a period of 5 years from the date
        expiry or termination of this Agreement except and until such
        Confidential Information enters the public domain as set out above.


18.     APPLICABILITY OF AGREEMENT TO AFFILIATE

        Affiliates of Chartered may enter into agreements for the Works with
        STATS in their own name and for their own account under the terms and
        conditions of this Agreement.


19.     NOTICES

19.1    Addresses

        All notices, demands or other communications required or permitted to be
        given or made under or in connection with this Agreement shall be in
        writing and shall be sufficiently given or made (a) if delivered by hand
        or commercial courier or (b) sent by pre-paid registered post or (c)
        sent by legible facsimile transmission (provided that the receipt of
        such facsimile transmission is confirmed and a copy thereof is sent
        immediately thereafter by pre-paid registered post or commercial
        courier) addressed to the intended recipient at its address or facsimile
        number set out below. A Party may from time to time notify the others of
        its change of address or facsimile number in accordance with this Clause
        19.

        STATS

        5 Yishun Street 23
        Singapore 768442
        Facsimile no: (65) 755-5082




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<PAGE>   14

        Attention: Legal Department

        Chartered

        60 Woodlands Industrial Park D
        Street 2
        Singapore 738406
        Facsimile no: (65) 362-2909
        Attention: Legal Department

19.2    Deemed Delivery

        Any such notice, demand or communication shall be deemed to have been
        duly served (a) if delivered by hand or commercial courier, or sent by
        pre-paid registered post, at the time of delivery; or (b) if made by
        successfully transmitted facsimile transmission, at the time of dispatch
        (provided that the receipt of such facsimile transmission is confirmed
        and that immediately after such dispatch, a copy thereof is sent by
        pre-paid registered post or commercial courier).


20.     WAIVER AND REMEDIES

20.1    No delay or neglect on the part of either Party in enforcing against the
        other Party any term or condition of this Agreement or in exercising any
        right or remedy under this Agreement shall either be or be deemed to be
        a waiver or in any way prejudice any right or remedy of that Party under
        this Agreement.

20.2    No remedy conferred by any of the provisions of this Agreement is
        intended to be exclusive of any other remedy which is otherwise
        available at law, in equity, by statute or otherwise and each and every
        other remedy shall be cumulative and shall be in addition to every other
        remedy given hereunder or now or hereafter existing at law, in equity,
        by statute or otherwise. The election of any one or more of such
        remedies by either of the Parties shall not constitute a waiver by such
        Party of the right to pursue any other available remedy.


21.     SEVERANCE

        If any provision or part of this Agreement is rendered void, illegal or
        unenforceable in any respect under any enactment or rule of law, the
        validity, legality and enforceability of the remaining provisions shall
        not in any way be affected or impaired thereby.


22.     ENTIRE AGREEMENT

22.1    This Agreement and the Appendices constitutes the entire agreement
        between STATS and Chartered and shall supersede all previous agreements
        and undertakings between Parties with respect to the subject matter
        hereof.



                                       12
<PAGE>   15

22.2    The following Appendices are hereby deemed a part of this Agreement and
        incorporated herein by reference.  The term 'Agreement' includes the
        following Appendices:-

        Appendix A         Specifications relating to Sort, Assembly and Final
                           Test of Wafers and/or Units


23.     NO ASSIGNMENT OR SUB-CONTRACTING

        Unless otherwise agreed in writing by the Parties, this Agreement may
        not be assigned or sub-contracted by either Party to any third-party
        without the prior written consent of the other Party, save that STATS
        may subcontract the plating process, probecard, loadboard and tape and
        reel services to its nominated subcontractors subject to Chartered's
        prior written consent for the change of subcontractors.


24.     GOVERNING LAW

24.1    This Agreement shall be governed by and construed in accordance with the
        substantive laws of Singapore. The Parties hereby irrevocably submit to
        the non-exclusive jurisdiction of the courts of Singapore.

24.2    The Parties hereby specifically exclude the application of the United
        Nations Convention on Contracts for the International Sale of Goods to
        this Agreement.

IN WITNESS WHEREOF the Parties have hereunto entered into this Agreement as at
the date first above written.



/s/ Jacky McNulty
------------------------------------------
Name:  Jacky McNulty
Title: Director, Supply Management
for and on behalf of
CHARTERED SEMICONDUCTOR MANUFACTURING LTD



/s/ Choong Chan Yong
------------------------------------------
Name:  Choong Chan Yong
Title:  Vice President, Sales and Marketing
for and on behalf of
ST ASSEMBLY TEST SERVICES LTD



                                       13
<PAGE>   16
                                   APPENDIX A

       SPECIFICATIONS RELATING TO THE SORT, ASSEMBLY AND/OR FINAL TEST OF
                              WAFERS AND/OR UNITS


<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
STATS SPECIFICATIONS
(AND AMENDMENTS THERETO)
--------------------------------------------------------------------------------
<S>                              <C>
DOCUMENT NO.                     DOCUMENT TITLE

TG080003QP                       Project Initiation/NRE and Program Acceptance
                                 Criteria

QT090010QP                       QA Incoming Wafer Inspection Procedure

TG160001QP                       Test Program/Audit Verification

TG020001QP                       Test Administration Procedure

QT090004QP                       QA Outgoing Wafer Inspection Procedure

AD140014QP                       Chartered Wafer Drop Ship Procedure
--------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
CHARTERED SPECIFICATIONS
(AND AMENDMENTS THERETO)
--------------------------------------------------------------------------------
DOCUMENT NO.                     DOCUMENT TITLE
<S>                              <C>
QX-079                           Chartered Subcontractor's Quality Management
                                 Procedure

QX-079-XX01                      Work Instruction for Wafer Sort, Final Test and
                                 Assembly House

QX-060                           Suppliers and Subcontractors Major Change Control

QX-038                           Procedure for Customer Returns

BX-005                           Turnkey Business Procedure
--------------------------------------------------------------------------------
</TABLE>



                                       14