Document:

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                                                                   Exhibit 10.14

                       DEVELOPMENT AND PROMOTION AGREEMENT

THIS DEVELOPMENT AND PROMOTION AGREEMENT is entered into on March 31, 1999
("Effective Date") by and between Taiwan Semiconductor Manufacturing Company
Ltd., a company duly incorporated under the laws of Republic of China having its
principal place of business at No. 121, Park Avenue 3, Science Based Industrial
Park, Hsinchu, Taiwan, ROC ("TSMC"), and Monolithic System Technology, Inc., a
company duly incorporated under the laws of the State of California having its
principal place of business at 1020 Stewart Drive, Sunnyvale, CA 94086, U.S.A.
("MoSys"), collectively referred to as "Parties".

WHEREAS, MoSys desires to adapt and port certain of its semiconductor circuits
and devices to be compliant to certain TSMC process technologies (the "Virtual
Component"); and

WHEREAS, Parties desire to jointly promote and/or distribute the Virtual
Component pursuant to the terms and provisions as provided in this Agreement.

NOW THEREFORE, the Parties hereto agree as follows:

I.       VIRTUAL COMPONENT DELIVERABLES AND TAPE-OUT

1.1      MoSys agrees to develop the Virtual Component for TSMC as specified in
Exhibit A. MoSys agrees to deliver to TSMC the information specified in the
Exhibit A and the following deliverables regarding each Virtual Component (the
"MoSys's Deliverables"). MoSys authorizes TSMC to use MoSys's Deliverables for
tape-out, production and packaging of thirty (30) testchips ("Prototypes") by
TSMC:

GDSII files
DRC / LVS report files
Virtual Component Size
Virtual Component Datasheet
Methodology and solution for pre-fabrication simulation
         (including simulation models, and testability on silicon)

The GDSII file may contain only those errors acceptable to TSMC. If not
acceptable, TSMC will so notify MoSys, in writing, and MoSys shall promptly
review and correct the unacceptable errors and resubmit the file to TSMC. MoSys
shall identify, in writing and with specificity, each and every separate and
individual Virtual Component contained in the GDSII File.

1.2      For the purposes of this Agreement, TSMC agrees to provide the
following information to MoSys upon request:

Design rules
SPICE models
DRC command files
Maximum permissible test chip die size
Layout mapping file
Test chip tape-out schedule

1.3      Upon completion of tapeout, TSMC will fabricate and package thirty (30)
testchips incorporating this Virtual Component for MoSys on its next available
"hot run". TSMC shall provide MoSys one engineering iteration upon request.

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II.      VERIFICATION REPORT AND JOINT MARKETING

2.1      MoSys agrees to start its own verification and qualification procedure
on the Prototypes produced by TSMC, and, within 60 days after receiving the
Prototypes, MoSys shall prepare and provide a verification report for the
Virtual Component to TSMC which shall include the information as outlined in the
Exhibit B (the "Verification Report").

2.2      Parties shall cooperate in jointly publishing the availability of the
Virtual Component on TSMC's processes, including making datasheets available for
the Virtual Component and a white paper describing the technology and benefits
to customers.

III.     DISTRIBUTION OF THE VIRTUAL COMPONENT

3.1      Both TSMC and MoSys will actively promote the Virtual Component to
customers of both Parties. All customers who desire to use the Virtual Component
may obtain it through either TSMC or MoSys directly. Both Parties agree to
inform customers that they shall only use the TSMC process-ported version of the
Virtual Component for tape-out and production exclusively at TSMC or its
designated facility. Neither party shall be forced to accept the other party's
customers.

3.2      TSMC may incorporate the Virtual Component as specified in Exhibit A in
customer designs following execution of a license agreement between TSMC and
MoSys that contains payment provisions for fees of 5% of net wafer sales for
wafers that include the Virtual Component, where the term "net wafer sales" will
be defined. TSMC shall not release the GDSII physical view to customers, but may
provide an abstract for place and route purposes.

3.3      TSMC and MoSys agree to enter into good faith discussions on the
licensing terms (including, but not limited to NRE and running royalty rates)
for variants (changes to memory size, organization or process) of the Virtual
Component as well as 1T-SRAM memory compilers, if required by customer demand.

IV.      PAYMENT

4.1      TSMC agrees to pay MoSys the sum of Thirty Thousand Dollars
($30,000.00) within thirty (30) days upon the first tapeout of a testchip
incorporating the Virtual Component. TSMC agrees to pay MoSys an additional sum
of Thirty Thousand Dollars ($30,000.00) within thirty (30) days of a successful
completion of evaluation of testchips including the Virtual Component by MoSys
and the delivery of the Verification Report to TSMC.

4.2      Either TSMC or MoSys may offset any due payment to the other party if
the receiving party has an outstanding balance owed to the other party at the
time that payment is due.

4.3      The Parties agree that this Agreement does not oblige TSMC to pay an
additional royalty to MoSys when customers have executed license agreements
directly with MoSys for the Virtual Component.

V.       PROPRIETARY INFORMATION

5.1      The term "Proprietary Information" shall mean any information provided
by a party hereto identified as proprietary and/or confidential and disclosed to
the other party according to this Agreement. Written Proprietary Information
shall be clearly marked "Confidential" or "Proprietary". All oral disclosures of
Proprietary Information shall be identified as such prior to disclosure and
confirmed in writing by the disclosing party within thirty (30) days of the oral
disclosure. In case of disagreement, the receiving party must make a written
objection thereto within thirty (30) days after receipt of the information, or
after receipt of written confirmation for orally disclosed information. The
terms and conditions of this agreement are Proprietary Information. The
Proprietary Information shall not include information that: (1) is now or
subsequently in the public domain or otherwise becomes available to the

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public other than by breach of this Agreement by the receiving party; (2) has
been rightfully in the receiving party's possession prior to receipt from the
disclosing party; (3) is rightfully received by the receiving party from a third
party; and (4) is independently developed by the receiving party without use of
any proprietary information or trade secrets of the disclosing party, and is
authorized by the disclosing party to be disclosed or released.

5.2      Both Parties hereto agree to maintain Proprietary Information in strict
confidence, not to make use thereof other than for the performance of this
Agreement, to release it only to employees who have a reasonable need to know
the same, and not to release or disclose it to any third party, without the
prior written consent of the disclosing party.

5.3      All Proprietary Information and any copies thereof shall remain the
property of the disclosing party. Upon expiration or termination of this
Agreement, or at the request of the disclosing party, the receiving party shall
return the original and all copies of Proprietary Information in tangible forms,
or at the sole option of the disclosing party destroy any and all copies,
partial or complete, in whatever media, and provide certification in writing
signed by an officer of the company that such destruction of such information
has been completed.

5.4      Parties acknowledge and agree that due to the unique nature of the
Proprietary Information, there can be no adequate remedy at law for any breach
of the obligations hereunder, that any such breach may result in irreparable
harm to the non-breaching party, and therefore, that upon any such breach or any
threat thereof, the non-breaching party shall be entitled to appropriate
equitable relief in addition to whatever remedies it might have at law.

5.5      This Section 5 shall survive the termination or expiration of this
Agreement for a period of five (5) years.

VI.      LIMITED LIABILITY

6.1      NEITHER PARTY SHALL BE LIABLE WITH RESPECT TO ANY SUBJECT MATTER OF
THIS AGREEMENT UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER THEORY
FOR ANY SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES.

VII.     WARRANTY AND INDEMNIFICATION

7.1      MoSys hereby warrants and represents that the Virtual Component was and
will be developed by MoSys, and/or that it has the right and authority to
authorize TSMC to use the Virtual Component as set forth herein.

7.2      MoSys agrees to indemnify, hold harmless and defend TSMC from and
against any and all damages, costs and expenses, excluding indirect, incidental,
or consequential damages, incurred in connection with a claim that the
Prototypes infringe on any valid patent, copyright, or any other intellectual
property right.

VIII.    INTELLECTUAL PROPERTY OWNERSHIP

8.1      All worldwide rights, titles and interests, including without
limitation all intellectual property rights, in and to the information,
specifications, and other materials provided by one party to the other party
under this Agreement shall remain the sole and exclusive property of the one
party. No licenses are granted herein, and neither party shall have any rights
in the intellectual property rights of the other, whether express, implied,
arising by estoppel or otherwise.

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IX.      TERM AND TERMINATION

9.1      This Agreement shall have an initial term of two (2) years from the
Effective Date and it shall be automatically renewed for successive one (1) year
terms unless one party gives another party a written notice 30 days prior to the
expiry of the term then in effect.

9.2      This Agreement may be early terminated by either party if the other
party (1) breaches any material provision of this Agreement and does not cure or
remedy such breach within thirty (30) days after receipt of the notice of breach
from the other party; (2) becomes the subject of a voluntary or involuntary
petition in bankruptcy or any proceeding relating to insolvency, receivership,
liquidation, or composition for the benefit of creditors if such petition or
proceeding is not dismissed with prejudice within sixty (60) days after filing.
Termination of this Agreement shall be effective 30 days after issuance of a
written notice of termination to the other party by the nondefaulting party.

9.3      Termination of this Agreement for any reason shall not affect (1) the
obligations accruing prior to the effective date of termination; and (2) any
obligations under Sections IV, V, VI, VII and VIII hereof, all of which shall
survive termination or expiry of this Agreement.

9.4      Upon expiration or termination of this Agreement, both Parties shall
immediately cease using the other party's name or goodwill to promote the
Virtual Component.

X.       EXPORT CONTROL

10.1     TSMC and MoSys are subject to national export control regulations of
the Republic of China and United States of America. TSMC and MoSys will take all
appropriate measures not to violate these regulations and will keep the other
party fully harmless from all damages arising out of or in connection with any
violation.

XI.      MISCELLANEOUS

11.1     Neither party shall be responsible for any failure to perform under
this Agreement, if such failure is caused by unforeseen circumstances or due to
causes beyond its reasonable control, including but not limited to acts of God,
riot, labor stoppages, acts of civil and military authorities, fire, floods or
accidents.

11.2     This Agreement shall be governed by and construed in accordance with
the laws of the State of California, USA. In the event of any dispute arising
out of or in connection with this Agreement which cannot be amicably settled by
Parties hereto, Parties agree to submit any such dispute to a binding
arbitration in English in San Jose, California in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. The arbitration shall
be before three (3) arbitrators, one to be selected by each party and the third
to be selected by the two selected arbitrators. Each party shall bear its own
expenses for the arbitration. The award rendered by the arbitration shall be
final and binding upon all Parties, and may be enforced in any court of
competent jurisdiction. Parties, their representatives, other participants and
arbitrators shall hold the existence, content and result of the arbitration in
confidence. Nothing in this Section shall be construed to preclude any party
hereto from seeking provisional remedies, including, but not limited to,
temporary restraining orders and preliminary injunctions from any court of
competent jurisdiction, in order to protect its rights pending arbitration. All
information relating to or disclosed by any party in connection with the
arbitration shall be treated by Parties and the arbitration panel as Proprietary
Information and no disclosure of such information shall be made by either party
or the arbitration panel without the prior written consent of the disclosing
party.

11.3     No waiver of any breach or failure by either party to enforce any
provision of this Agreement shall be deemed a waiver of any other or subsequent
breach or a waiver of future enforcement of that or any other provision.

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11.4     No modification, alteration or amendment of this Agreement shall be
effective unless in writing and signed by both Parties.

11.5     In the event that any provision of this Agreement shall be determined
to be illegal or unenforceable, that provision will be limited or eliminated to
the minimum extent necessary so that this Agreement shall otherwise remain in
full force and effect and enforceable.

11.6     Neither party shall have any right or ability to assign, transfer, or
sublicense any obligations or benefit under this Agreement without the written
consent of the other except that a party (i) may assign and transfer this
Agreement and its rights and obligations hereunder to any third party who
succeeds to substantially all of its business or assets, (ii) may assign or
transfer any rights to receive payments hereunder, or (iii) in order to perform
its obligations under this Agreement, a party may assign to a sub-contractor who
shall be subject to confidentiality obligations and with the other party's prior
approval. The party who assigns to such sub-contractor shall be fully
responsible to the other party for the acts of such sub-contractor.

11.7     The relation of Parties hereto is that of independent contractors, and
neither party is an employee, agent, partner or joint venture of the other.

IN WITNESS WHEREOF, Parties hereto have caused this Agreement to be duly
executed in duplicate on their behalf by their duly authorized officers and
representatives on the date given above.

Taiwan Semiconductor                     Monolithic System Technology, Inc.
Manufacturing Co., Ltd.

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

Name:                                    Name:

Title:                                   Title:

                                       5<PAGE>

                                                                   Exhibit 10.15

                              TERMINATION AGREEMENT

         THIS AGREEMENT is made as of August 6, 1998 by and among Taiwan
Semiconductor Manufacturing Company Limited ("TSMC"), a company organized under
the laws of the Republic of China ("R.O.C."), with its registered address at No.
121, Park Avenue 3, Science Based Industrial Park, Hsinchu, Taiwan, R.O.C.,
Monolithic System Technology Incorporated ("MOSYS"), a company organized under
the laws of California, United States of America ("U.S.A.") with its registered
address at 2670 Seely Avenue, San Jose, CA 95134, U.S.A., and M-One Technology
Incorporated ("MONE"), a company organized under the laws of the Republic of
China, with its registered address at Room 106, 47 Park Avenue 2, Science Based
Industrial Park, Hsinchu, Taiwan, R.O.C.

         WHEREAS, TSMC, MOSYS and MONE (collectively referred to as the
"Parties") have entered into an option agreement ("Option Agreement", attached
hereto as Attachment 1) on November 23, 1995 and amended subsequently on
September 23, 1996 ("Amendment", attached hereto as Attachment 2); and

         WHEREAS, the Parties desire to terminate the Option Agreement and the
Amendment, to release each other of all obligations and commitments contained
therein and to terminate any rights associated therewith;

         NOW, THEREFORE, the Parties agree as follows:

1.       This Agreement is effective as of the date hereof.

2.       The Parties shall not be responsible for any further duties,
         obligations and commitments, and the Parties shall not be entitled to
         any further rights, including but not limited to wafer capacity and
         option fee, specified in and under the Option Agreement and the
         Amendment, except TSMC's right stipulated in Section 3 of this
         Agreement.

3.       TSMC is granted the right to purchase UP TO One Million Two Hundred
         Thousands (1,200,000) shares of MOSYS' common stock at the exercise
         price of U.S. Six Dollars and Fifty Cents (US$6.50) per share anytime
         prior to the closing of the issuance of shares of common stock of Mosys
         in an underwritten public offering or when Mosys is acquired by third
         parties.

4.       This Agreement does not affect the rights and obligations of the
         Parties existing and accrued prior to the date hereof. Specifically,
         MOSYS and MONE shall be and remain liable to TSMC for any obligations
         and duties, including all outstanding payments for the wafers already
         ordered and/or shipped.

5.       The duty of confidentiality of the Parties contained in the Option
         Agreement and the Amendment shall survive after this Agreement.

6.       This Agreement shall be governed and interpreted in accordance with the
         laws of the Republic of China.

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         IN WITNESS WHEREOF, the Parties have signed and dated this Agreement in
the spaces provided below:

TAIWAN SEMICONDUCTOR                      MONOLITHIC SYSTEM
MANUFACTURING COMPANY                     TECHNOLOGYINCORPORATED
LIMITED

BY:                                       BY:
   ------------------------------------      -----------------------------------

NAME:                                     NAME:
     ----------------------------------        ---------------------------------

TITLE:                                    TITLE:
      ---------------------------------         --------------------------------

DATE:                                     DATE:
     ----------------------------------        ---------------------------------

                                          M-ONE TECHNOLOGY
                                          INCORPORATED

                                          BY:
                                             -----------------------------------

                                          NAME:
                                               ---------------------------------

                                          TITLE:
                                                --------------------------------

                                          DATE:
                                               ---------------------------------

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THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT THE PRIOR
WRITTEN CONSENT OF THE COMPANY OR WITHOUT AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO OR AN OPINION OF COUNSEL FOR THE HOLDER, SATISFACTORY TO THE
COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE ACT OR RECEIPT OF A
NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION.

                                                                  August 6, 1998

                       MONOLITHIC SYSTEM TECHNOLOGY, INC.
                            a California corporation

                     COMMON STOCK PURCHASE WARRANT AGREEMENT

         THIS CERTIFIES THAT, for value received, Taiwan Semiconductor
         Manufacturing Co., Ltd. (hereinafter, the "Holder"), is entitled, upon
         the terms and subject to the conditions hereinafter set forth, to
         purchase from Monolithic System Technology, Inc., a California
         corporation (the "Company"), that number of fully paid and
         nonassessable shares of the Company's Common Stock at the purchase
         price per share as set forth in Section 1 below.

                         TERMS AND CONDITIONS OF WARRANT

1.       NUMBER OF SHARES; EXERCISE PRICE; TERM.

                  (a)      The Holder shall be entitled to subscribe for and
                  purchase up to One Million, Two Hundred Thousand (1,200,000)
                  shares of the fully paid and nonassessable Common Stock of the
                  Company (the "Shares") at an exercise price of U.S. $6.50 per
                  share (the "Exercise Price").

                  (b)      The Holder may exercise this Warrant at any time and
                  from time to time prior to 5:00 p.m. (California Time) on
                  August 6, 2002 (the "Expiration Date"). This Warrant shall
                  expire and cease to be exercisable after the Expiration Date.

2.       EXERCISE OF WARRANT. This Warrant may be exercised by the Holder as to
the whole or any lesser number of the Shares covered hereby, at any time and
from time to time prior to the Expiration Date, upon surrender of this Warrant
to the Company at its principal executive office together with the Notice of
Exercise and Investment Representation Statement annexed hereto as EXHIBITS A
and B. respectively, duly

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completed and executed by the Holder, and payment to the Company of the
aggregate Exercise Price for the Shares to be purchased in the form of a check
made payable to the Company in an amount equal to the aggregate Exercise Price
for the Shares to be purchased. Certificates for the Shares so purchased shall
be delivered to the Holder within a reasonable time not to exceed 21 days after
exercise of the stock purchase rights represented by this Warrant. The exercise
of this Warrant shall be deemed to have been effected on the day on which the
Holder surrenders this Warrant to the Company and satisfies all of the
requirements of this Section 2. Upon such exercise, the Holder will be deemed a
shareholder of record of those Shares for which the warrant has been exercised
with all rights of a shareholder (including, without limitation, all voting
rights with respect to such Shares and all rights to receive any dividends with
respect to such Shares). If this Warrant is to be exercised in respect of less
than all of the Shares covered hereby, the Holder shall be entitled to receive a
new warrant covering the number of Shares in respect of which this Warrant shall
not have been exercised and for which it remains subject to exercise. Such new
warrant shall be in all other respects identical to this Warrant.

3.       COVENANTS OF THE COMPANY. The Company covenants and agrees that all
equity securities which may be issued upon the exercise of the rights
represented by this Warrant, upon issuance and payment therefor in accordance
herewith, will be duly authorized, validly issued, fully paid, and nonassessable
shares of capital stock of the Company. The Company further covenants and agrees
that, during the period within which the stock purchase rights represented by
this Warrant may be exercised, the Company will at all times have duly
authorized and duly reserved for issuance upon the exercise of the purchase
rights evidenced by this Warrant a number of shares of its Common Stock
sufficient for such issuance.

4.       TRANSFER, EXCHANGE, OR LOSS OF WARRANT.

         (a)      This Warrant may not be assigned or transferred except as
         provided in this Section 4 and in accordance with and subject to the
         provisions of the Securities Act of 1933, as amended, and the Rules and
         Regulations promulgated thereunder (collectively, the "Securities
         Act"). Any purported transfer or assignment made other than in
         accordance with this Section 4 shall be null and void and of no force
         or effect.

         (b)      Prior to any transfer of this Warrant, other than in an
         offering registered under the Securities Act, the Holder shall notify
         the Company of its intention to effect such transfer, indicating the
         circumstances of the proposed transfer and, upon request, furnish the
         Company with an opinion of its counsel, in form and substance
         satisfactory to counsel for the Company, to the effect that the
         proposed transfer may be made without registration under the Securities
         Act or qualification under any applicable state securities laws. The
         Company will promptly notify the Holder if the opinion of counsel
         furnished to the Company is satisfactory to counsel for the Company.
         Unless the Company notifies the Holder within ten (10) days after its
         receipt of such opinion that such opinion is not

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         satisfactory to counsel for the Company, the Holder may proceed to
         effect the transfer.

         (c)      Unless a registration statement under the Securities Act is
         effective with respect to the Shares or any other security issued upon
         exercise of this Warrant, the certificate representing such Shares or
         other securities shall bear the following legend, in addition to any
         legend imposed by applicable state securities laws:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). NO SALE OR DISPOSITION MAY
BE EFFECTED WITHOUT THE PRIOR WRITTEN CONSENT OF THE COMPANY OR WITHOUT AN
EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL FOR
THE HOLDER, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED
UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE
COMMISSION.

         (d)      Upon receipt by the Company of satisfactory evidence of loss,
         theft, destruction, or mutilation of this Warrant and of indemnity
         satisfactory to the Company, and upon surrender and cancellation of
         this Warrant, if mutilated, the Company will execute and deliver a new
         Warrant of like tenor and date and any such lost, stolen, or destroyed
         Warrant shall thereupon become void. Any such new Warrant executed and
         delivered shall constitute an additional contractual obligation on the
         part of the Company, whether or not the Warrant so lost, stolen,
         destroyed, or mutilated shall be at any time enforceable by anyone.

5.       NO FRACTIONAL SHARES OR SCRIP. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant. In lieu of any fractional share to which such holder would otherwise be
entitled, such holder shall be entitled, at its option, to receive either (i) a
cash payment equal to the excess of the Fair Market Value for such fractional
share above the Exercise Price for such fractional share (as mutually determined
by the Company and the Holder) or (ii)a whole share if the Holder tenders the
Exercise Price for one whole share.

6.       NO RIGHTS AS SHAREHOLDERS. This Warrant does not entitle the holder
hereof to any voting rights, dividend rights, or other rights as a shareholder
of the Company prior to the exercise hereof.

7.       SATURDAYS, SUNDAYS, HOLIDAYS, ETC. If the last or appointed day for the
taking of any action or the expiration of any right required or granted herein
shall be a Saturday or a Sunday or shall be a legal holiday, then such action
may be taken or such right may be exercised on the next succeeding day not a
Saturday or a Sunday or a legal holiday.

8.       ADJUSTMENTS. The Exercise Price per Share and the number of Shares
purchasable hereunder shall be subject to adjustment from time to time as
follows:

         (a)      MERGER. If at any time there shall be a merger or
         consolidation of the Company with or into another corporation when the
         Company is not the surviving

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         corporation, then, as a part of such merger or consolidation, lawful
         provision shall be made so that the holder of this Warrant shall
         thereafter be entitled to receive upon exercise of this Warrant, during
         the period specified herein and upon payment of the aggregate Exercise
         Price then in effect, the number of shares of stock or other securities
         or property of the successor corporation resulting from such merger or
         consolidation, to which a holder of the stock deliverable upon exercise
         of this Warrant would have been entitled in such merger or
         consolidation if this Warrant had been exercised immediately before
         such merger or consolidation. In any such case, appropriate adjustment
         shall be made in the application of the provisions of this Warrant with
         respect to the rights and interests of the Holder after the merger or
         consolidation.

         (b)      RECLASSIFICATION, ETC. If the Company shall, at any time, by
         subdivision, combination, or reclassification of securities or
         otherwise, change any of the securities as to which purchase rights
         under this Warrant exist into the same or a different number of
         securities of any other class or classes, the Exercise Price shall be
         adjusted such that this Warrant shall thereafter represent the right to
         acquire such number and kind of securities as would have been issuable
         as the result of such change with respect to the securities which were
         subject to the purchase rights under this Warrant immediately prior to
         such subdivision, combination, reclassification or other change.

         (c)      SPLIT, SUBDIVISION OR COMBINATION OF SHARES. If the Company at
         any time while this Warrant remains outstanding and unexpired shall
         split, subdivide or combine the securities as to which purchase rights
         under this Warrant exist, the Exercise Price shall be proportionately
         decreased in the case of a split or subdivision or proportionately
         increased in the case of a combination.

9.       NOTICE OF ADJUSTMENTS; NOTICES. Whenever the Exercise Price or number
of Shares issuable upon exercise hereof shall be adjusted pursuant to Section 8
hereof, the Company shall issue a written notice setting forth, in reasonable
detail, the event requiring the adjustment, the amount of the adjustment, the
method by which such adjustment was calculated and the Exercise Price and number
of Shares purchasable hereunder after giving effect to such adjustment, and
shall cause a copy of such notice to be mailed to the holder of this Warrant.

10.      MISCELLANEOUS.

         (a)      SUCCESSORS AND ASSIGNS. This Warrant shall be binding upon any
         successors or assigns of the Company.

         (b)      GOVERNING LAW. This Warrant shall be governed by and construed
         in accordance with the laws of the State of California as applied to
         agreements between California residents entered and to be performed
         entirely within California.

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<PAGE>

         (c)      ATTORNEYS' FEES. In any litigation, arbitration, or court
         proceeding between the Company and the holder relating hereto, the
         prevailing party shall be entitled to reasonable attorneys' fees and
         expenses incurred in enforcing this Warrant.

         (d)      AMENDMENTS. This Warrant may be amended and the observance of
         any term of this Warrant may be waived only with the written consent of
         the Company and the Holder.

         (e)      NOTICE. Any notice, request, or other communication required
         or permitted hereunder shall be in writing and shall be deemed to have
         been duly given if personally delivered, sent by facsimile, or mailed
         by registered or certified mail, postage prepaid, or by recognized
         overnight courier or personal delivery at the respective addresses or
         facsimile number of the parties as set forth below. Any party hereto
         may by notice so given change its address for future notice hereunder.
         Notice shall conclusively be deemed to have been given when received.

         If to the Holder: Taiwan Semiconductor Manufacturing Co., Ltd.
                                    No. 121, Park Avenue 3
                                    Science-Based Industrial Park
                                    Hsinchu, Taiwan
                                    Republic of China

         If to the Company:         Monolithic System Technology, Inc.
                                    1020 Stewart Drive
                                    Sunnyvale, California 94086
                                    Attn:  Chief Financial Officer
                                    Fax:  (408) 731-18993

         (f)      INVESTOR RIGHTS. All Shares issuable upon exercise of this
         Warrant are subject to the registration rights provisions of the Fourth
         Amended and Restated Investor Rights Agreement dated March 31, 1998
         (the "Rights Agreement"), as such agreement may be amended from time to
         time, as evidenced by an Addendum to the Rights Agreement executed by
         the original holder of this Warrant in connection with its purchase of
         the Notes and this Warrant pursuant to the Purchase Agreement.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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<PAGE>

         IN WITNESS WHEREOF, the Company and the Holder have caused this Common
Stock Purchase Warrant Agreement to be executed as of the date first above
written.

                                          MONOLITHIC SYSTEM TECHNOLOGY, INC.

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

                                          Name:
                                               ---------------------------------

                                          Title:
                                                --------------------------------

Acknowledged and Agreed:

TAIWAN SEMICONDUCTOR
MANUFACTURING CO., LTD.

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

Name:
     -----------------------------------

Title:
      ----------------------------------

                                       6

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