SUNNYVALE, Calif.–(BUSINESS WIRE)–Sept. 2, 2004–Monolithic
System Technology, Inc. (MoSys), (NASDAQ: MOSY) the industry’s leading
provider of high density SoC embedded memory solutions, announced
today that its board of directors authorized the granting of
approximately two million stock options, or 6% of the company stock,
as a retention incentive to company employees. The stock options were
granted with an exercise price of $3.85 and a ten-year term. The
grants will vest over a four-year period from the date of the stock
option grant.

The company also announced they have repurchased over one million
shares, or 3% of the company stock, thus far in the current quarter.
MoSys had previously announced on April 19, 2004 that its Board of
Directors had authorized the purchase of up to $25 million of its
common stock over the next year. The share repurchases may be made,
from time to time in the open market subject to market conditions and
other factors. These repurchases may be commenced or suspended at any
time or from time to time without prior notice.

ABOUT MOSYS

Founded in 1991, MoSys (NASDAQ: MOSY), develops, licenses and
markets innovative memory technologies for semiconductors. MoSys’
patented 1T-SRAM technologies offer a combination of high density, low
power consumption, high speed and low cost unmatched by other
available memory technologies. The single transistor bit cell used in
1T-SRAM memory results in the technology achieving much higher density
than traditional four or six transistor SRAMs while using the same
standard logic manufacturing processes. 1T-SRAM technologies also
offer the familiar, refresh-free interface and high performance for
random address access cycles associated with traditional SRAMs. In
addition, these technologies can reduce operating power consumption by
a factor of four compared with traditional SRAM technology,
contributing to making them ideal for embedding large memories in
System on Chip (SoC) designs. MoSys’ licensees have shipped more than
80 million chips incorporating 1T-SRAM embedded memory technologies,
demonstrating excellent manufacturability in a wide range of silicon
processes and applications. MoSys is headquartered at 1020 Stewart
Drive, Sunnyvale, California 94085. More information is available on
MoSys’ website at http://www.mosys.com.

FORWARD LOOKING STATEMENTS

This press release may contain forward-looking statements about
the Company including, without limitation, benefits and performance
expected from use of the Company’s 1T-SRAM technology.

Forward-looking statements are based on certain assumptions and
expectations of future events that are subject to risks and
uncertainties. Actual results and trends may differ materially from
historical results or those projected in any such forward-looking
statements depending on a variety of factors. These factors include
but are not limited to, customer acceptance of our 1T-SRAM
technologies, the timing and nature of customer requests for our
services under existing license agreements, the timing of customer
acceptance of our work under such agreements, the level of commercial
success of licensees’ products such as the Nintendo GAMECUBE and cell
phone hand sets, ease of manufacturing and yields of devices
incorporating our 1T-SRAM, our ability to enhance the 1T-SRAM
technology or develop new technologies, the level of intellectual
property protection provided by our patents, the vigor and growth of
markets served by our licensees and customers, the impact of the
Company’s recent acquisition of ATMOS Corporation on future operating
results and operations of the Company and other risks identified in
the Company’s most recent annual report on Form 10-K filed with the
Securities and Exchange Commission, as well as other reports that
MoSys files from time to time with the Securities and Exchange
Commission. MoSys undertakes no obligation to update publicly any
forward-looking statement for any reason, except as required by law,
even as new information becomes available or other events occur in the
future.

1T-SRAM(R) is a MoSys trademark registered in the U.S. Patent and
Trademark Office. All other trade, product, or service names
referenced in this release may be trademarks or registered trademarks
of their respective holders.

CONTACT: MoSys, Sunnyvale
Mark Voll, 408-731-1846
markv@mosys.com
or
Shelton IR
Beverly Twing, 972-239-5119 ext. 126
btwing@sheltongroup.com

SOURCE: Monolithic System Technology, Inc.