TSMC’s Leading 0.13-Micron Process Selected by Transmeta for Lower-Power, Higher-Performance Crusoe Microprocessor

Hsin-Chu, Taiwan, June 26, 2001 – Taiwan Semiconductor Manufacturing Company (NYSE:TSM) said Transmeta Corporation (Nasdaq: TMTA) will base its new Crusoe TM5800 microprocessor on 0.13-micron technology developed and manufactured by TSMC. The selection of TSMC as the manufacturing partner for this new microprocessor is a powerful acknowledgement of the company’s IC foundry leadership and confirms TSMC’s unique ability to deliver this technology in volume.

The new TSMC 0.13-micron process will provide the Crusoe processor with up to 50 percent higher performance and 20 percent lower power consumption relative to Transmeta’s previous generation of microprocessors.

“Our relationship with TSMC is a key part of our strategy,” said Mark K. Allen, president and chief executive officer, Transmeta Corporation. “Our confidence in TSMC has allowed Transmeta to convert 100 percent of production wafer starts to TSMC’s 0.13-micron manufacturing lines.”

“TSMC is the first IC foundry in the world to begin volume production of a 0.13-micron high-performance CPU process,” said Dr. Edward C. Ross, president of TSMC North America. “With thousands of hours of experience in the development of this technology, we are confident that TSMC can deliver the volumes necessary to provide our customers with a significant competitive advantage in their respective markets.”

TSMC first taped out its 0.13-micron process in the fourth quarter of 2000 and was the first foundry to deliver production wafers at this node in January 2001. By the end of July, TSMC will have taped out more than 40 customer products in two fabs and delivered more than 100 designs through its multiproject wafer prototyping program.

“The original Crusoe TM5600 microprocessors broke new ground for long battery life systems and the new Crusoe TM5800 based systems will raise the bar for leadership in power consumption with performance segment,” said Jim Chapman, executive vice president of sales and marketing, Transmeta Corporation. “Now our customers can take advantage of Crusoe’s 0.13-micron power specifications, Code Morphing software improvements and the industry trend towards DDR memory, to build best-in-class systems that will lead the industry in the drive toward wireless productivity.”

The Crusoe TM5800 and TM5500 microprocessors are immediately available.

Cautionary Statement for Transmeta Investors

This release contains forward-looking statements, which are made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally preceded by words such as “plans,” “expects,” “believes,” “anticipates” or “intends.” Investors are cautioned that all forward-looking statements in this release involve risks and uncertainty that could cause actual results to differ materially from current expectations. We urge investors to review in detail the risks and uncertainties described in Transmeta’s recent filings with the United States Securities and Exchange Commission, including specifically our recent Form 10-K and our most recently filed form 10-Q.

About TSMC

TSMC is the world's largest dedicated semiconductor foundry, providing the industry’s leading process technology, library and IP options and other leading-edge foundry services. TSMC operates two six-inch wafer fabs and nine eight-inch wafer fabs in three countries, including its two joint ventures fabs – Vanguard and SSMC – and its North American subsidiary, WaferTech. In 2000, TSMC produced the foundry industry's first 300mm customer wafers and began constructing two dedicated 300mm fabs. TSMC's corporate headquarters are in Hsin-Chu, Taiwan. More information about TSMC is available through th