Document:

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                                                                    Exhibit 10.1

                       MONOLITHIC SYSTEM TECHNOLOGY, INC.
                                      FORM
                                       OF
                               INDEMNITY AGREEMENT

         This Indemnification Agreement (the "AGREEMENT") is made as of ______
___, 2000, by and between Monolithic System Technology, Inc., a Delaware
corporation (the "COMPANY"), and ______________ ("INDEMNITEE").

                                    RECITALS

         The Company and Indemnitee recognize the increasing difficulty in
obtaining liability insurance for directors, officers and key employees, the
significant increases in the cost of such insurance and the general reductions
in the coverage of such insurance. The Company and Indemnitee further recognize
the substantial increase in corporate litigation in general, subjecting
directors, officers and key employees to expensive litigation risks at the same
time as the availability and coverage of liability insurance has been severely
limited. Indemnitee does not regard the current protection available as adequate
under the present circumstances, and Indemnitee and agents of the Company may
not be willing to continue to serve as agents of the Company without additional
protection. The Company desires to attract and retain the services of highly
qualified individuals, such as Indemnitee, and to indemnify its directors,
officers and key employees so as to provide them with the maximum protection
permitted by law.

                                    AGREEMENT

         In consideration of the mutual promises made in this Agreement, and for
other good and valuable consideration, receipt of which is hereby acknowledged,
the Company and Indemnitee hereby agree as follows:

         1.       CERTAIN DEFINITIONS; CONSTRUCTION OF PHRASES.

                  (a) "Change in Control" shall mean, and shall be deemed to
have occurred if, on or after the date of this Agreement, (i) any "person" (as
such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Company acting in such capacity or a
corporation owned directly or indirectly by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the Company,
becomes the "beneficial owner" (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the Company representing more than 50%
of the total voting power represented by the then outstanding securities of the
Company that vote generally at elections ("VOTING SECURITIES"), (ii) during any
period of two consecutive years, individuals who at the beginning of such period
constitute the Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning of the
period or whose election or

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nomination for election was previously so approved, cease for any reason to
constitute a majority thereof, or (iii) the stockholders of the Company approve
a merger or consolidation of the Company with any other corporation other than a
merger or consolidation which would result in the Voting Securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities of the
surviving entity) at least 80% of the total voting power represented by the
Voting Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or the stockholders of the
Company approve a plan of complete liquidation of the Company or an agreement
for the sale or disposition by the Company of (in one transaction or a series of
related transactions) all or substantially all of the Company's assets.

                  (b) References to the "Company" shall include, in addition to
the Company, any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger to which the Company (or any
of its wholly owned subsidiaries) is a party which, if its separate existence
had continued, would have had power and authority to indemnify its directors,
officers, employees, agents or fiduciaries, so that if Indemnitee is or was a
director, officer, employee, agent or fiduciary of such constituent corporation,
or is or was serving at the request of such constituent corporation as a
director, officer, employee, agent or fiduciary of another corporation,
partnership, joint venture, employee benefit plan, trust or other enterprise,
Indemnitee shall stand in the same position under the provisions of this
Agreement with respect to the resulting or surviving corporation as Indemnitee
would have with respect to such constituent corporation if its separate
existence had continued.

                  (c) "Independent Legal Counsel" shall mean an attorney or firm
of attorneys, selected in accordance with the provisions of Section 2(d) hereof,
who shall not have otherwise performed services for the Company or Indemnitee
within the last three years (other than with respect to matters concerning the
rights of Indemnitee under this Agreement, or of other indemnitees under similar
indemnity agreements).

                  (d) For purposes of this Agreement, references to "other
enterprises" shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on Indemnitee with respect to an employee
benefit plan; and references to "serving at the request of the Company" shall
include any service as a director, officer, employee or agent of the Company
which imposes duties on, or involves services by, such director, officer,
employee or agent with respect to an employee benefit plan, its participants, or
beneficiaries; and if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan, Indemnitee shall be deemed to have acted in a
manner "not opposed to the best interests of the Company" as referred to in this
Agreement.

                  (e) "Reviewing Party" shall mean a majority of the Company's
Board of Directors who are not parties to the particular Claim (even if less
than a quorum) for which Indemnitee is seeking indemnification, or Independent
Legal Counsel.

         2.       INDEMNIFICATION.

                  (a) THIRD PARTY PROCEEDINGS. The Company shall indemnify
Indemnitee if Indemnitee is or was a party or is threatened to be made a party
to any threatened, pending or

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completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Company) by reason
of the fact that Indemnitee is or was a director, officer, employee or agent of
the Company, or any subsidiary of the Company, by reason of any action or
inaction on the part of Indemnitee while an officer or director or by reason of
the fact that Indemnitee is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement (if such settlement is
approved in advance by the Company, which approval shall not be unreasonably
withheld) and other amounts actually and reasonably incurred by Indemnitee in
connection with such action, suit or proceeding if Indemnitee acted in good
faith and in a manner Indemnitee reasonably believed to be in or not opposed to
the best interests of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe Indemnitee's conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent
shall not, of itself, create a presumption that Indemnitee did not act in good
faith and in a manner which Indemnitee reasonably believed to be in or not
opposed to the best interests of the Company, or, with respect to any criminal
action or proceeding, that Indemnitee had reasonable cause to believe that
Indemnitee's conduct was unlawful.

                  (b) PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY. The Company
shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to
be made a party to any threatened, pending or completed action or suit by or in
the right of the Company or any subsidiary of the Company to procure a judgment
in its favor by reason of the fact that Indemnitee is or was a director,
officer, employee or agent of the Company, or any subsidiary of the Company, by
reason of any action or inaction on the part of Indemnitee while an officer or
director or by reason of the fact that Indemnitee is or was serving at the
request of the Company as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees) and, to the fullest extent permitted by
law, amounts paid in settlement (if such settlement is approved in advance by
the Company, which approval shall not be unreasonably withheld), in each case to
the extent actually and reasonably incurred by Indemnitee in connection with the
defense or settlement of such action or suit if Indemnitee acted in good faith
and in a manner Indemnitee reasonably believed to be in or not opposed to the
best interests of the Company and its stockholders. Termination of any action,
suit or proceeding by judgment or settlement shall not, of itself, create a
presumption that Indemnitee did not act in good faith and in a manner which
Indemnitee reasonably believed to be in or not opposed to the best interest of
the Company. Notwithstanding the foregoing, no indemnification under this
Section 2(b) shall be made in respect of any claim, issue or matter as to which
Indemnitee shall have been finally adjudicated by court order or judgment to be
liable to the Company in the performance of Indemnitee's duty to the Company and
its stockholders unless and only to the extent that the court in which such
action or proceeding is or was pending shall determine upon application that, in
view of all the circumstances of the case, Indemnitee is fairly and reasonably
entitled to indemnity for such expenses which such court shall determine.

                  (c) REVIEW OF INDEMNIFICATION. Notwithstanding the foregoing,
(i) the obligations of the Company under Sections 2(a) and 2(b) (unless ordered
by a court) shall be subject to the condition that the Reviewing Party shall
authorize (in a written opinion, in any case in which the Independent Legal
Counsel referred to in Section 2(d) hereof is involved) indemnification in the
specific case, upon a determination that indemnification of Indemnitee is proper
in the circumstances

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because Indemnitee has met the applicable standard of conduct set forth in
Sections 2(a) and 2(b), (ii) the obligation of the Company to make an advance of
expenses pursuant to Section 4(a) shall be subject to the condition that, if,
when and to the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under applicable law, the Company shall be
entitled to be reimbursed by Indemnitee (who hereby agrees to reimburse the
Company) for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced or thereafter commences legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the Reviewing Party
that Indemnitee would not be permitted to be indemnified under applicable law
shall not be binding and Indemnitee shall not be required to reimburse the
Company for any advance of expenses until a final judicial determination is made
with respect thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). Indemnitee's obligation to reimburse the Company for any
advance of expenses shall be unsecured and no interest shall be charged thereon.
If there has not been a Change in Control, the Reviewing Party shall be selected
by the Board of Directors, and if there has been such a Change in Control (other
than a Change in Control which has been approved by a majority of the Company's
Board of Directors who were directors immediately prior to such Change in
Control), the Reviewing Party shall be the Independent Legal Counsel. If there
has been no determination by the Reviewing Party or if the Reviewing Party
determines that Indemnitee substantively would not be permitted to be
indemnified in whole or in part under applicable law, Indemnitee shall have the
right to commence litigation seeking an initial determination by the court or
challenging any such determination by the Reviewing Party or any aspect thereof,
including the legal or factual bases therefor, and the Company hereby consents
to service of process and to appear in any such proceeding. Absent such
litigation, any determination by the Reviewing Party shall be conclusive and
binding on the Company and Indemnitee.

                  (d) CHANGE IN CONTROL. The Company agrees that if there is a
Change in Control of the Company (other than a Change in Control which has been
approved by a majority of the Company's Board of Directors who were directors
immediately prior to such Change in Control), then, with respect to all matters
arising prior to the Change in Control, the rights of Indemnitee to payments of
expenses and advances of expenses under this Agreement or any other agreement or
under the Company's Certificate of Incorporation or Bylaws as now or hereafter
in effect, Independent Legal Counsel, if desired by Indemnitee, shall be
selected by Indemnitee and approved by the Company (which approval shall not be
unreasonably withheld). Such counsel, among other things, shall render its
written opinion to the Company and Indemnitee as to whether and to what extent
Indemnitee would be permitted to be indemnified under applicable law and the
Company agrees to abide by such opinion. The Company agrees to pay the
reasonable fees of the Independent Legal Counsel referred to above and to
indemnify fully such counsel against any and all expenses (including attorneys'
fees), claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto. Notwithstanding any other provision
of this Agreement, the Company shall not be required to pay expenses of more
than one Independent Legal Counsel in connection with all matters concerning a
single Indemnitee, and such Independent Legal Counsel shall be the Independent
Legal Counsel for any or all other Indemnitees unless (i) the Company otherwise
determines or (ii) any Indemnitee shall provide a written statement setting
forth in detail a reasonable objection to such Independent Legal Counsel
representing other Indemnitees.

                  (e) MANDATORY PAYMENT OF EXPENSES. Notwithstanding the other
provisions of this Section 2, to the extent that Indemnitee has been successful
on the merits or otherwise in defense of

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any action, suit or proceeding referred to in Section 2(a) or Section 2(b) or
the defense of any claim, issue or matter therein, Indemnitee shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by Indemnitee in connection therewith.

         3.       NO EMPLOYMENT RIGHTS. Nothing contained in this Agreement is
intended to create in Indemnitee any right to continued employment.

         4.       EXPENSES; INDEMNIFICATION PROCEDURE.

                  (a) ADVANCEMENT OF EXPENSES. Except as otherwise determined
pursuant to Section 2(c), the Company shall advance all expenses incurred by
Indemnitee in connection with the investigation, defense, settlement or appeal
of any civil or criminal action, suit or proceeding referred to in Section 2(a)
or Section 2(b) (including amounts actually paid in settlement of any such
action, suit or proceeding). Indemnitee hereby undertakes to repay such amounts
advanced only if, and to the extent that, it shall ultimately be determined that
Indemnitee is not entitled to be indemnified by the Company as authorized
hereby.

                  (b) NOTICE/COOPERATION BY INDEMNITEE. Indemnitee shall, as a
condition precedent to his or her right to be indemnified under this Agreement,
give the Company notice in writing as soon as practicable of any claim made
against Indemnitee for which indemnification will or could be sought under this
Agreement. Notice to the Company shall be directed to the Chief Executive
Officer of the Company and shall be given in accordance with the provisions of
Section 12(d) below. In addition, Indemnitee shall give the Company such
information and cooperation as it may reasonably require and as shall be within
Indemnitee's power.

                  (c) PROCEDURE. If a claim under this Agreement, under any
statute, or under any provision of the Company's Certificate of Incorporation or
Bylaws providing for indemnification, is not paid in full by the Company within
thirty (30) days after a written request for payment thereof has first been
received by the Company, Indemnitee may, but need not, at any time thereafter
bring an action against the Company to recover the unpaid amount of the claim
and, subject to Section 11 of this Agreement, Indemnitee shall also be entitled
to be paid for the expenses (including attorneys' fees) of bringing such action.
It shall be a defense to any such action (other than an action brought to
enforce a claim for expenses incurred in connection with any action, suit or
proceeding in advance of its final disposition) that Indemnitee has not met the
standards of conduct which make it permissible under applicable law for the
Company to indemnify Indemnitee for the amount claimed. It is the parties'
intention that, if the Company contests Indemnitee's right to indemnification,
the question of Indemnitee's right to indemnification shall be for the court to
decide, and neither the failure of the Company (including its Board of
Directors, any committee or subgroup of the Board of Directors, independent
legal counsel, or its stockholders) to have made a determination that
indemnification of Indemnitee is proper in the circumstances because Indemnitee
has met the applicable standard of conduct required by applicable law, nor an
actual determination by the Company (including its Board of Directors, any
committee or subgroup of the Board of Directors, independent legal counsel, or
its stockholders) that Indemnitee has not met such applicable standard of
conduct, shall create a presumption that Indemnitee has or has not met the
applicable standard of conduct.

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                  (d) NOTICE OF INSURERS. If, at the time of the receipt of a
notice of a claim pursuant to Section 4(b) hereof, the Company has director and
officer liability insurance in effect, the Company shall give prompt notice of
the commencement of such proceeding to the insurers in accordance with the
procedures set forth in the respective policies. The Company shall thereafter
take all necessary or desirable action to cause such insurers to pay all amounts
payable as a result of such proceeding in accordance with the terms of such
policies.

                  (e) SELECTION OF COUNSEL. In the event the Company shall be
obligated under Section 4(a) hereof to pay the expenses of any proceeding
against Indemnitee, the Company shall be entitled to assume the defense of such
proceeding, with counsel reasonably acceptable to Indemnitee, upon the delivery
to Indemnitee of written notice of its election so to do. After delivery of such
notice, approval of such counsel by Indemnitee and the retention of such counsel
by the Company, the Company will not be liable to Indemnitee under this
Agreement for any fees of other counsel subsequently incurred by Indemnitee with
respect to the same proceeding, provided that Indemnitee shall have the right to
employ additional counsel in any such proceeding at Company's expense if: (i)
the employment of counsel by Indemnitee has been previously authorized by the
Company, (ii) Indemnitee shall have reasonably concluded that there is a
conflict of interest between the Company and Indemnitee in the conduct of any
such defense or (iii) the Company shall not, in fact, have employed counsel to
assume the defense of such proceeding.

         5.       ADDITIONAL INDEMNIFICATION RIGHTS; NONEXCLUSIVITY.

                  (a) SCOPE. Notwithstanding any other provision of this
Agreement, the Company hereby agrees to indemnify Indemnitee to the fullest
extent permitted by law, notwithstanding that such indemnification is not
specifically authorized by the other provisions of this Agreement, the Company's
Certificate of Incorporation, the Company's Bylaws or by statute. In the event
of any change, after the date of this Agreement, in any applicable law, statute,
or rule which expands the right of a Delaware corporation to indemnify a member
of its board of directors or an officer, such changes shall be deemed to be
within the purview of Indemnitee's rights and the Company's obligations under
this Agreement. In the event of any change in any applicable law, statute or
rule which narrows the right of a Delaware corporation to indemnify a member of
its board of directors or an officer, such changes, to the extent not otherwise
required by such law, statute or rule to be applied to this Agreement shall have
no effect on this Agreement or the parties' rights and obligations hereunder.

                  (b) NONEXCLUSIVITY. The indemnification provided by this
Agreement shall not be deemed exclusive of any additional rights to
indemnification to which Indemnitee may be entitled under the Company's
Certificate of Incorporation, its Bylaws, any agreement, any vote of
stockholders or disinterested members of the Company's Board of Directors, the
General Corporation Law of the State of Delaware, or otherwise, both as to
action in Indemnitee's official capacity and as to action in another capacity
while holding such office. The indemnification provided under this Agreement
shall continue as to Indemnitee for any action taken or not taken while serving
in an indemnified capacity even though he or she may have ceased to serve in any
such capacity at the time of any action, suit or other covered proceeding.

         6.       PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of the expenses, judgments,

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fines or penalties actually or reasonably incurred in the investigation,
defense, appeal or settlement of any civil or criminal action, suit or
proceeding, but not, however, for the total amount thereof, the Company shall
nevertheless indemnify Indemnitee for the portion of such expenses, judgments,
fines or penalties to which Indemnitee is entitled.

         7.       MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee
acknowledge that in certain instances, federal law or public policy may
override applicable state law and prohibit the Company from indemnifying its
directors and officers under this Agreement or otherwise. For example, the
Company and Indemnitee acknowledge that the Securities and Exchange
Commission (the "SEC") has taken the position that indemnification is not
permissible for liabilities arising under certain federal securities laws,
and federal legislation prohibits indemnification for certain ERISA
violations. Indemnitee understands and acknowledges that the Company has
undertaken or may be required in the future to undertake with the SEC to
submit the question of indemnification to a court in certain circumstances
for a determination of the Company's right under public policy to indemnify
Indemnitee.

         8.       SEVERABILITY. Nothing in this Agreement is intended to
require or shall be construed as requiring the Company to do or fail to do
any act in violation of applicable law. The Company's inability, pursuant to
court order, to perform its obligations under this Agreement shall not
constitute a breach of this Agreement. The provisions of this Agreement shall
be severable as provided in this Section 9. If this Agreement or any portion
hereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the
full extent permitted by any applicable portion of this Agreement that shall
not have been invalidated, and the balance of this Agreement not so
invalidated shall be enforceable in accordance with its terms.

         9.       EXCEPTIONS. Any other provision herein to the contrary
notwithstanding, the Company shall not be obligated pursuant to the terms of
this Agreement:

                  (a) CLAIMS INITIATED BY INDEMNITEE. To indemnify or advance
expenses to Indemnitee with respect to proceedings or claims initiated or
brought voluntarily by Indemnitee and not by way of defense, except with respect
to proceedings brought to establish or enforce a right to indemnification under
this Agreement or any other statute or law, but such indemnification or
advancement of expenses may be provided by the Company in specific cases if the
Board of Directors finds it to be appropriate;

                  (b) LACK OF GOOD FAITH. To indemnify Indemnitee for any
expenses incurred by Indemnitee with respect to any proceeding instituted by
Indemnitee to enforce or interpret this Agreement, if a court of competent
jurisdiction determines that each of the material assertions made by Indemnitee
in such proceeding was not made in good faith or was frivolous;

                  (c) INSURED CLAIMS. To indemnify Indemnitee for expenses or
liabilities of any type whatsoever (including, but not limited to, judgments,
fines, ERISA excise taxes or penalties, and amounts paid in settlement) to the
extent such expenses or liabilities have been paid directly to Indemnitee by an
insurance carrier under a policy of officers' and directors' liability insurance
maintained by the Company; or

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                  (d) CLAIMS UNDER SECTION 16(b). To indemnify Indemnitee for
expenses or the payment of profits arising from the purchase and sale by
Indemnitee of securities in violation of Section 16(b) of the Securities
Exchange Act of 1934, as amended, or any similar successor statute.

         10.      ATTORNEYS' FEES. In the event that any action is instituted by
either Indemnitee or by or in the name of the Company under this Agreement, the
prevailing party shall be entitled to such party's costs of suit and reasonable
attorneys' fees, which shall be payable whether or not such action or proceeding
is prosecuted to judgment.

         11.      MISCELLANEOUS.

                  (a) GOVERNING LAW. This Agreement and all acts and
transactions pursuant hereto and the rights and obligations of the parties
hereto shall be governed, construed and interpreted in accordance with the laws
of the State of Delaware, without giving effect to principles of conflict of
law.

                  (b) ENTIRE AGREEMENT; ENFORCEMENT OF RIGHTS. This Agreement
sets forth the entire agreement and understanding of the parties relating to the
subject matter herein and merges all prior discussions between them. No
modification of or amendment to this Agreement, nor any waiver of any rights
under this Agreement, shall be effective unless in writing signed by the parties
to this Agreement. The failure by either party to enforce any rights under this
Agreement shall not be construed as a waiver of any rights of such party.

                  (c) CONSTRUCTION. This Agreement is the result of negotiations
between and has been reviewed by each of the parties hereto and their respective
counsel, if any; accordingly, this Agreement shall be deemed to be the product
of all of the parties hereto, and no ambiguity shall be construed in favor of or
against any one of the parties hereto.

                  (d) NOTICES. Any notice, demand or request required or
permitted to be given under this Agreement shall be in writing and shall be
deemed sufficient when delivered personally or sent by confirmed facsimile or
twenty-four (24) hours after being deposited with a nationally recognized
overnight courier or forty-eight (48) hours after being deposited in the U.S.
mail, as certified or registered mail, with postage prepaid, and addressed to
the party to be notified at such party's address or facsimile number as set
forth below or as subsequently modified by written notice.

                  (e) COUNTERPARTS. This Agreement may be executed in two or
more counterparts, and delivery of a signed counterpart by facsimile
transmission will constitute due execution and delivery of this Agreement.

                  (f) SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon the Company and its successors and assigns, and inure to the benefit of
Indemnitee and Indemnitee's heirs and legal representatives.

                  (g) SUBROGATION. In the event of payment under this Agreement,
the Company shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnitee, who shall execute all documents required and
shall do all acts that may be necessary to secure such rights and to enable the
Company to effectively bring suit to enforce such rights.

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         The parties hereto have executed this Agreement as of the day and year
set forth on the first page of this Agreement.

                                       MONOLOTHIC SYSTEM TECHNOLOGY, INC.
                                       A Delaware Corporation

                                       By:
                                              ---------------------------
                                       Title:
                                              ---------------------------
                                       Address:   1020 Stewart Drive
                                                  Sunnyvale, CA 94086

AGREED TO AND ACCEPTED:

By:
   ------------------------------

---------------------------------
Name

Address:

Facsimile Number:

                                       9<PAGE>
                                                                    Exhibit 10.2
                       MONOLITHIC SYSTEM TECHNOLOGY, INC.
                             1992 STOCK OPTION PLAN

         1.       PURPOSES OF THE PLAN. The purposes of this Stock Option Plan
are to attract and retain the best available personnel for positions of
substantial responsibility, to provide additional incentive to the Employees and
Consultants of the Company and to promote the success of the Company's business.

                  Options granted hereunder may be either Incentive Stock
Options or Nonstatutory Stock Options, at the discretion of the Board and as
reflected in the terms of the written option agreement.

         2.       DEFINITIONS. As used herein, the following definitions shall
apply:

                  (a)      "BOARD" shall mean the Committee, if one has been
appointed, or the Board of Directors of the Company, if no Committee is
appointed.

                  (b)      "CODE" shall mean the Internal Revenue Code of 1986,
as amended.

                  (c)      "COMMITTEE" shall mean the Committee appointed by the
Board of Directors in accordance with paragraph (a) of Section 4 of the Plan, if
one is appointed.

                  (d)      "COMMON STOCK" shall mean the Common Stock of the
Company.

                  (e)      "COMPANY" shall mean Monolithic System Technology,
Inc., a California corporation.

                  (f)      "CONSULTANT" shall mean any person who is engaged by
the Company or any Parent or Subsidiary to render consulting services; the term
Consultant shall not include directors.

                  (g)      "CONTINUOUS STATUS AS AN EMPLOYEE, CONSULTANT OR
DIRECTOR" shall mean the absence of any interruption or termination of service
as an Employee, Consultant or Director. Continuous Status as an Employee,
Consultant or Director shall not be considered interrupted in the case of sick
leave, military leave, or any other leave of absence approved by the Board;
provided that, in the case of an Incentive Stock Option, such leave is for a
period of not more than ninety (90) days or reemployment upon the expiration of
such leave is guaranteed by contract or statute.

                  (h)      "DIRECTOR" hall mean a member of the Board of
Directors of the Company.

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                  (i)      "EMPLOYEE" shall mean any person, including officers
and directors, employed by the Company or any Parent or Subsidiary of the
Company. The payment of a director's fee by the Company shall not be sufficient
to constitute "employment" by the Company.

                  (j)      "EXCHANGE ACT" shall mean the Securities Exchange Act
of 1934, as amended.

                  (k)      "INCENTIVE STOCK OPTION" shall mean an Option
intended to qualify as an incentive stock option within the meaning of Section
422 of the Code.

                  (l)      "NONSTATUTORY STOCK OPTION" shall mean an Option not
intended to qualify as an Incentive Stock Option.

                  (m)      "OPTION" shall mean a stock option granted pursuant
to the Plan.

                  (n)      "OPTIONED STOCK" shall mean the Common Stock subject
to an Option.

                  (o)      "OPTIONEE" shall mean an Employee or Consultant who
receives an Option.

                  (p)      "PARENT" shall mean a "parent corporation", whether
now or hereafter existing, as defined in Section 425(e) of the Code.

                  (q)      "PLAN" shall mean this 1992 Stock Option Plan.

                  (r)      "SHARE" shall mean a share of the Common Stock, as
adjusted in accordance with Section 11 of the Plan.

                  (s)      "SUBSIDIARY" shall mean a "subsidiary corporation,"
whether now or hereafter existing, as defined in Section 425(f) of the Code.

         3.       STOCK SUBJECT TO THE PLAN. Subject to the provisions of
Section 11 of the Plan, the maximum aggregate number of shares which may be
optioned and sold under the Plan is 900,000 shares of Common Stock.

                  If an Option should expire or become unexercisable for any
reason without having been exercised in full, the unpurchased Shares which were
subject thereto shall, unless the Plan shall have been terminated, become
available for future grant under the Plan. Notwithstanding any other provision
of the Plan, shares issued under the Plan and later repurchased by the Company
shall not become available for future grant or sale under the Plan.

         4.       ADMINISTRATION OF THE PLAN.

                  (a)      PROCEDURE. The Plan shall be administered by the
Board of Directors of the Company, or by a committee appointed by the Board of
Directors consisting of two (2) or more Directors, in accordance with the
following provisions:

                           (i)      Members of the Board who are either eligible
for Options or have been granted Options may vote on any matters affecting
administration of the Plan or the grant of Options pursuant to the Plan;
provided, however, no member of the Board shall act upon the

                                       2
<PAGE>

granting of an Option to himself or herself, but any such member may be counted
in determining the existence of a quorum at any meeting of the Board during
which action is taken with respect to the granting of options to him or her.

                           (ii)     The Committee shall administer the Plan on
behalf of the Board of Directors, subject to such terms and conditions as the
Board of Directors may prescribe. Once appointed, a Committee shall continue to
serve until otherwise directed by the Board of Directors. Subject to the
foregoing, from time to time the Board of Directors may increase the size of the
Committee and appoint new members in substitution therefor, fill vacancies
however caused, or remove all members of the Committee and thereafter directly
administer the Plan.

                  (b)      POWERS OF THE BOARD. Subject to the provisions of the
Plan, the Board shall have the authority, in its discretion: (i) to grant
Incentive Stock Options or Nonstatutory Stock Options; (ii) to determine, upon
review of relevant information and in accordance with Section 8(b) of the Plan,
the fair market value of the Common Stock; (iii) to determine the exercise price
per share of Options to be granted, which exercise price shall be determined in
accordance with Section 8(a) of the Plan; (iv) to determine the Employees,
Consultants and Directors to whom, and the time or times at which, Options shall
be granted and the number of shares to the represented by each Option; (v) to
interpret the Plan; (vi) to prescribe, amend and rescind rules and regulations
relating to the Plan; (vii) to determine the terms and provisions of each Option
granted (which need not be identical) and, with the consent of the holder
thereof, modify or amend each Option (including the exercise price thereof);
(viii) to accelerate the exercise date of any Option, consistent with the
provisions of Section 5 of the Plan, provided that in the event of a transaction
described in Section 11 of the Plan any such acceleration can occur only as
contemplated by the provisions of Section 11 of the Plan; (ix) to authorize any
person to execute on behalf of the Company any instrument required to effectuate
the grant of an option previously granted by the Board; and (x) to make all
other determinations deemed necessary or advisable for the administration of the
Plan.

                  (c)      EFFECT OF BOARD'S DECISION. All decisions,
determinations and interpretations of the Board shall be final and binding on
all Optionees and any other holders of any Options granted under the Plan.

         5.       ELIGIBILITY.

                  (a)      Nonstatutory Stock Options may be granted to
Employees, Consultants and Directors. Incentive Stock Options may be granted
only to Employees. An Employee, Consultant or Director who has been granted an
Option may, if he is otherwise eligible, be granted an additional Option or
Options.

                  (b)      No Incentive Stock Option may be granted to an
Employee which, when aggregated with all other incentive stock options granted
to such Employee by the Company or any Parent or Subsidiary, would result in
Shares having an aggregate fair market value (determined for each Share as of
the date of grant of the incentive stock option covering such Share) in excess
of $100,000 becoming first available for purchase upon exercise of one or more
incentive stock options during any calendar year.

                  (c)      Section 5(b) of the Plan shall apply only to an
Incentive Stock Option evidenced by an "Incentive Stock Option Agreement" which
sets forth the intention of the Company

                                       3
<PAGE>

and the Optionee that such Option shall qualify as an Incentive Stock Option.
Section 5(b) of the Plan shall not apply to any Option evidenced by a
"Nonstatutory Stock Option Agreement" which sets forth the intention of the
Company and the Optionee that such Option shall be a Nonstatutory Stock Option.

                  (d)      The Plan shall not confer upon any Optionee any right
with respect to continuation of employment with, consulting relationship with,
or membership on the Board of Directors of, the Company, nor shall it interfere
in any way with his or her right or the Company's right to terminate such
employment, consulting relationship or membership on the Board of Directors at
any time.

         6.       TERM OF PLAN. The Plan shall become effective upon the earlier
to occur of its adoption by the Board of Directors or its approval by the
shareholders of the Company as described in Section 18 of the Plan. It shall
continue in effect for a term of ten (10) years unless sooner terminated under
Section 13 of the Plan.

         7.       TERM OF OPTION. The term of each Option shall be ten (10)
years from the date of grant thereof or such shorter term as may be provided in
the Stock Option Agreement. However, in the case of an Option granted to an
Optionee who, at the time the Option is granted, owns stock representing more
than ten percent (10%) of the voting power of all classes of stock of the
Company or any Parent or Subsidiary, the term of the Option shall be five (5)
years from the date of grant thereof or such shorter term as may be provided in
the Stock Option Agreement.

         8.       EXERCISE PRICE AND CONSIDERATION.

                  (a)      The per share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be such price as is determined by
the Board, but shall be subject to the following:

                           (i)      In the case of an Incentive Stock Option

                                    (A)      granted to an Employee who, at the
time of the grant of such Incentive Stock Option, owns stock representing more
than ten percent (10%) of the voting power of all classes of stock of the
Company or any Parent or Subsidiary, the per Share exercise price shall be no
less than 110% of the fair market value per Share on the date of grant or, if
the Incentive Stock Option is amended to reduce the per Share exercise price,
less than 110% of the fair market value per Share on the date the Board approves
such amendment.

                                    (B)      granted to any Employee, the per
Share exercise price shall be no less than 100% of the fair market value per
Share on the date of grant or, if the Incentive Stock Option is amended to
reduce the per Share exercise price, 100% of the fair market value per Share on
the date the Board approves such amendment.

                           (ii)     In the case of a Nonstatutory Stock Option

                                    (A)      granted to a person who, at the
time of the grant of such Option, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or any Parent
or Subsidiary, the per Share exercise price shall be no less than 110% of the
fair market value per Share on the date of the grant or, if the Nonstatutory
Stock Option

                                       4
<PAGE>

is amended to reduce the per Share exercise price, 110% of the fair market value
per Share on the date the Board approves the amendment.

                                    (B)      granted to any person, the per
Share exercise price shall be no less than 85% of the fair market value per
Share on the date of grant or, if the Nonstatutory Stock Option is amended to
reduce the per Share exercise price, 85% of the fair market value per Share on
the date the Board approves the amendment.

                  (b)      The fair market value per Share shall be determined
by the Board in its discretion; provided, however, that where there is a public
market for the Common Stock, the fair market value per Share shall be the mean
of the bid and asked prices (or the closing price per share if the Common Stock
is listed on the National Association of Securities Dealers Automated Quotation
("NASDAQ") National Market System) of the Common Stock for the date of grant (or
date of approval of an amendment to reduce the exercise price per Share, as the
case may be), as reported in the Wall Street Journal (or, if not so reported, as
otherwise reported by the NASDAQ System) or, in the event the Common Stock is
listed on a stock exchange, the fair market value per Share shall be the closing
price on such exchange on such date, as reported in the Wall Street Journal.

                  (c)      The consideration to be paid for the Shares to be
issued upon exercise of an Option, including the method of payment, shall be
determined by the Board and may consist entirely of (i) cash, (ii) check, (iii)
delivery of other shares of Common Stock of the Company, which (A) in the case
of Shares acquired upon exercise of an Option, have been owned by the Optionee
for more than six months on the date of surrender, and (B) have a value equal to
the exercise price of the Shares as to which the Option is being exercised, (iv)
promissory note, (v) delivery of a properly executed exercise notice together
with such other documentation as the Company and the broker, if applicable,
shall require to effect an exercise of the Option and delivery to the Company of
the sale or loan proceeds required to pay the exercise price, (vi) any
combination of such methods of payment, or (vii) such other consideration and
method of payment for the issuance of Shares to the extent permitted under the
California Corporations Code.

         9.       EXERCISE OF OPTION.

                  (a)      (i)      PROCEDURE FOR EXERCISE; RIGHTS AS A
SHAREHOLDER. Any Option granted hereunder shall be exercisable at such times and
under such conditions as may determined by the Board, with vesting not occuring
at a lesser rate than 20% per year. Performance criteria shall be an applicable
to the conditions under which an optionee can exercise for those optionees
earning $65,000 or more per year, and who have the requisite (a) sophistication
to evaluate the criteria used, and (b) authority and control to effecute it.

                           (ii)     An Option may not be exercised for a
fraction of a Share.

                           (iii)    An Option shall be deemed to be exercised
when written notice of such exercise has been given to the Company in accordance
with the terms of the Option and full payment for the Shares with respect to
which the Option is exercised has been received by the Company. Full payment
may, as authorized by the Board, consist of any consideration and method of
payment allowable under Section 8(c) of the Plan. Until the issuance (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
such Shares, no right to vote or receive dividends or

                                       5
<PAGE>

any other rights as a shareholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Company shall issue (or
cause to be issued) such stock certificate promptly upon exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date the stock certificate is issued, except as provided in
Section 11 of the Plan.

                           (iv)     Exercise of an Option in any manner shall
result in a decrease in the number of Shares which thereafter may be available,
both for purposes of the Plan and for sale under the Option, by the number of
Shares as to which the Option is exercised.

                  (b)      TERMINATION OF STATUS AS AN EMPLOYEE OR CONSULTANT.
In the event of termination of an Optionee's Continuous Status as an Employee,
Consultant or Director (as the case may be), such Optionee may exercise his or
her Option to the extent that he or she was entitled to exercise it at the date
of such termination (or to such greater extent as the Board may determine). Any
such exercise must occur within the period set forth in the written option
agreement which, in the case of an Incentive Stock Option, shall be no more than
three (3) months after the date of termination. The Option shall terminate on
the date of such termination of Continuous Status as an Employee, Consultant or
Director to the extent of the number of shares of Optioned Stock as to which the
Option was not exercisable on the date of such termination, as set forth in the
written option agreement or as the Board may otherwise determine. To the extent
the Optionee fails, within the time period specified in the written option
agreement, to exercise the Option for those shares of Optioned Stock as to which
he or she is entitled to exercise, the Option shall terminate upon the
expiration of such time period.

                  (c)      DISABILITY OF OPTIONEE. Notwithstanding the
provisions of Section 9(b) above, in the event of termination of an Optionee's
Continuous Status as an Employee or Consultant or Director as a result of his
disability, he or she may exercise his or her Option to the extent he or she was
entitled to exercise it at the date of such termination (or to such greater
extent as the Board may determine). Any such exercise must occur within the
period set forth in the written option agreement which, in the case of an
Incentive Stock Option, shall be no more than twelve (12) months after the date
of such termination (and in any event such exercise must be on or before the
expiration date of the Option as set forth in the written option agreement). The
Option shall terminate on the date of such termination of Continuous Status as
an Employee, Consultant or Director to the extent of the number of shares of
Optioned Stock as to which the Option was not exercisable on the date of such
termination, as set forth in the written option agreement or as the Board may
otherwise determine. To the extent the Optionee fails, within the time period
specified in the written option agreement, to exercise the Option for those
shares of Optioned Stock as to which he or she is entitled to exercise, the
Option shall terminate upon the expiration of such time period.

                  (d)      DEATH OF OPTIONEE. In the event of the death during
the term of the Option of an Optionee:

                           (i)      who is at the time of his death an Employee,
Consultant or Director of the Company and who shall have been in Continuous
Status as an Employee, Consultant or Director since the date of grant of the
Option, the Option may be exercised by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only to

                                       6
<PAGE>

the extent, and within the time period, set forth in the Option Agreement (or
such greater extent or time period as the Board may determine) subject to the
limitation set forth in Section 5(b).

                           (ii)     within three (3) months after the
termination of Continuous Status as an Employee or Consultant, the Option may be
exercised by the Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to the extent, and
within the time period, set forth in the Option Agreement (or such greater
extent or time period as the Board may determine).

         10.      NON-TRANSFERABILITY OF OPTIONS. The Option may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other
than by will or by the laws of descent or distribution and may be exercised,
during the lifetime of the Optionee, only by the Optionee.

         11.      ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER. Subject
to any required action by the shareholders of the Company, the number of shares
of Common Stock covered by each outstanding Option, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option, as well as the price per share of
Common Stock covered by each such outstanding Option, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option.

                  In the event of the proposed dissolution or liquidation of the
Company, the Board shall notify the Optionee at least fifteen (15) days prior to
such proposed action. To the extent it has not been previously exercised, the
Option will terminate immediately prior to the consummation of such proposed
action.

         12.      STOCK WITHHOLDING TO SATISFY WITHHOLDING TAX OBLIGATIONS. At
the discretion of the Board, Optionees may satisfy withholding obligations as
provided in this paragraph. When an Optionee incurs tax liability in connection
with an Option, which tax liability is subject to tax withholding under
applicable tax laws, and the Optionee is obligated to pay the Company an amount
required to be withheld under applicable tax laws, the Optionee may satisfy the
withholding tax obligation by electing to have the Company withhold from the
Shares to be issued upon exercise of the Option that number of Shares having a
fair market value equal to the amount required to be withheld. The fair market
value of the Shares to be withheld shall be determined on the date that the
amount of tax to be withheld is to be determined (the "Tax Date").

                  All elections by an Optionee to have Shares withheld for this
purpose shall be made in writing in a form acceptable to the Board and shall be
subject to the following restrictions:

                                       7
<PAGE>

                  (a)      the election must be made on or prior to the
applicable Tax Date;

                  (b)      once made, the election shall be irrevocable as to
the particular Shares of the Option as to which the election is made;

                  (c)      all elections shall be subject to the consent or
disapproval of the Board.

                  In the event the election to have Shares withheld is made by
an Optionee and the Tax Date is deferred under Section 83 of the Code because no
election is filed under Section 83(b) of the Code, the Optionee shall receive
the full number of Shares with respect to which the Option is exercised but such
Optionee shall be unconditionally obligated to tender back to the Company the
proper number of Shares on the Tax Date.

         13.      TIME OF GRANTING OPTIONS. The date of grant of an Option
shall, for all purposes, be the date on which the Board makes the determination
granting such Option. Notice of the determination shall be given to each
Employee or Consultant to whom an Option is so granted within a reasonable time
after the date of such grant.

         14.      AMENDMENT AND TERMINATION OF THE PLAN.

                  (a)      AMENDMENT AND TERMINATION. The Board may at any time
amend, alter, suspend, or discontinue the Plan, but no amendment, alteration,
suspension, or discontinuation shall be made which would impair the rights of
any Optionee under any grant theretofore made, without his or her consent. In
addition, to the extent necessary and desirable to comply with Rule 16b 3 under
the Exchange Act or under Section 422 of the Code (or any other applicable law
or regulation), the Company shall obtain shareholder approval of any Plan
amendment in such a manner and to such a degree as required.

                  (b)      EFFECT OF AMENDMENT OR TERMINATION. Any such
amendment or termination of the Plan shall not affect Options already granted
and such Options shall remain in full force and effect as if this Plan had not
been amended or terminated, unless mutually agreed otherwise between the
Optionee and the Board, which agreement must be in writing and signed by the
Optionee and the Company.

         15.      CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued
pursuant to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such Shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.

                  As a condition to the exercise of an Option, the Company may
require the person exercising such Option to represent and warrant at the time
of any such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned relevant provisions of law.

                                       8
<PAGE>

         16.      RESERVATION OF SHARES. The Company, during the term of this
Plan, will at all times reserve and keep available such number of Shares as
shall be sufficient to satisfy the requirements of the Plan.

                  The inability of the Company to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares hereunder,
shall relieve the Company of any liability in respect of the failure to issue or
sell such Shares as to which such requisite authority shall not have been
obtained.

         17.      OPTION AGREEMENT. Options shall be evidenced by written option
agreements in such form as the Board shall approve.

         18.      SHAREHOLDER APPROVAL. Continuance of the Plan shall be subject
to approval by the shareholders of the Company within twelve (12) months before
or after the date the Plan is adopted as provided in Section 6. Such shareholder
approval shall be obtained in the degree and manner required under applicable
state and federal law.

         19.      INFORMATION TO OPTIONEE. The Company shall provide to each
Optionee, during the period for which such Optionee has one or more Options
outstanding, copies of all annual reports and other information which are
provided to all shareholders of the Company. The Company shall not be required
to provide such information to key employees whose duties in connection with the
Company assure their access to equivalent information.

                                       9

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