UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549



                                    FORM 8-K


                Current Report Pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934


                          Date of Report June 11, 1997


                           QUALITY SEMICONDUCTOR, INC.
             (Exact name of registrant as specified in its charter)



      California                       2-23128                    77-0199189
(State or other jurisdiction         (Commission                (IRS Employer
of incorporation)                    File Number)            Identification No.)



                                851 Martin Avenue
                              Santa Clara, CA 95050
          (Address of principal executive offices) (including Zip code)



                                 (408) 450-8000
              (Registrant's telephone number, including area code)



                             Exhibit Index on page 4

<PAGE>

Item 5.  Other Events

         On May 22, 1997, Quality Semiconductor,  Inc., a California corporation
(the "Company") announced that it had arranged a private placement (the "Private
Placement")  of  108,000  units,  each  consisting  of ten  (10)  shares  of the
Company's  Common Stock and a one-year  warrant to purchase  one (1)  additional
share of the Company's  Common  Stock.  The units were priced at $85.00 per unit
for a total of $9.2 million in cash.  The closing of the Private  Placement took
place on May 28, 1997. Needham & Company, Inc. received a placement fee of equal
to $60,000 for services rendered in connection with the Private  Placement.  The
investors  included funds  affiliated with Galleon Group,  Zesiger Capital Group
LLC,  CG Funds and Weiss Peck & Greer  LLC.  The  Company  relied on Rule 506 of
Regulation D under the  Securities  Act of 1933, as amended (the "Act"),  which,
among other things, provides an exemption from the registration  requirements of
the Act for  sales  to  accredited  investors  (as  defined  by Rule  501(a)  of
Regulation  D under the Act).  Under the  terms of the  Private  Placement,  the
Company has agreed to file a  Registration  Statement on Form S-3 within  thirty
days of the  closing of the  transaction,  to cover the shares of the  Company's
Common Stock that were  delivered  to the  investors at the closing and that are
issuable  upon  exercise of the  warrants.  The specific  terms of the Units are
contained  in the  instruments  defining  the rights of the holders of the Units
attached as an exhibit  hereto and  incorporated  by reference  herein.  Further
details of this  transaction  are contained in the Company's press release dated
May 22,  1997,  attached  as an exhibit  hereto and  incorporated  by  reference
herein.

Item 7.  Financial Statements, Pro Forma Financial Information and Exhibits.

         (c)      Exhibits.

Exhibit 4.1       Form of Unit Purchase Agreement (including Warrant),  dated
                  May 22, 1997 between  Quality  Semiconductor,  Inc. and the
                  Purchasers  (as defined therein).

Exhibit 99        Quality Semiconductor, Inc. Press Release dated May 22, 1997.


<PAGE>



                                   SIGNATURES


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                           QUALITY SEMICONDUCTOR, INC.


Date:  June 11, 1997                       By: /s/  JOHN P. GOLDSBERRY
                                               -----------------------------
                                               John P. Goldsberry
                                               Vice President - Finance and
                                               Chief Financial Officer
                                               (Duly Authorized and Principal
                                               Financial and Accounting Officer)
<PAGE>

                           QUALITY SEMICONDUCTOR, INC.

                                INDEX TO EXHIBITS


                                                                     Sequential
Exhibit Number     Description                                       Page Number

Exhibit 4.1        Form  of  Unit  Purchase   Agreement   (including      5
                   Warrant),   dated  May 22, 1997  between  Quality
                   Semiconductor,   Inc.  and  the   Purchasers  (as
                   defined therein).

Exhibit 99         Press Release dated May 22, 1997                       31


<PAGE>

                                                                    EXHIBIT 4.1
                             UNIT PURCHASE AGREEMENT


Quality Semiconductor, Inc.
851 Martin Avenue
Santa Clara, CA  95050-2903


Ladies & Gentleman:

         The undersigned, ____________________(the "Purchaser"), hereby confirms
its agreement with you as follows:

         1. This Unit Purchase Agreement (the "Agreement") is made as of May 16,
1997  between  Quality  Semiconductor,   Inc.,  a  California  corporation  (the
"Company"), and the Purchaser.

         2. The Company has  authorized  the sale and  issuance of up to 108,000
units (the "Units"), each consisting of ten (10) shares (the "Shares") of Common
Stock of the Company and one warrant (the  "Warrants") to purchase one (1) share
of Common Stock of the Company.

         3. The Company and the Purchaser agree that the Purchaser will purchase
and the  Company  will  sell,  for a purchase  price of $85.00  per Unit,  or an
aggregate       purchase       price       of        $_________________________,
_____________________Units  pursuant to the Terms and Conditions for Purchase of
Units  attached  hereto as Annex I and  incorporated  herein by  reference as if
fully  set  forth  herein.   Unless   otherwise   requested  by  the  Purchaser,
certificates  representing  the Shares and Warrants  purchased by the  Purchaser
will be registered in the Purchaser's name and address as set forth below.

     4. The Purchaser represents that, except as set forth below, (a) it has had
no position,  office or other material  relationship within the past three years
with the Company or its  affiliates and (b) neither it nor any group of which it
is a  member  beneficially  owns  any  securities  of the  Company.  Exceptions:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(If no  exceptions,  write "none." If left blank,  response will be deemed to be
"none").

         Please  confirm that the foregoing  correctly  sets forth the agreement
between us by signing in the space provided below for that purpose.


                                 PURCHASER

                                 By: ____________________________________
                                 Title: _________________________________
                                 Address: _______________________________

                                 Tax ID No.: ____________________________

AGREED AND ACCEPTED:

___________________________
Quality Semiconductor, Inc.

By: _______________________
Title: ____________________

<PAGE>
                                     ANNEX I

                   TERMS AND CONDITIONS FOR PURCHASE OF UNITS

         1.       Authorization and Sale of Units

                  1.1  Authorization.  The Company has  authorized  the sale and
issuance  of up to 108,000  units (the  "Units"),  each  consisting  of ten (10)
shares of Common Stock of the Company (the "Shares") and one warrant to purchase
one (1) share of Common Stock of the Company (the  "Warrants"),  pursuant to the
Agreement.  The shares of Common Stock of the Company to be issued upon exercise
of the Warrants are hereinafter referred to as the "Warrant Shares."

                  1.2 Sale of Units.  Subject to the terms and conditions of the
Agreement,  the  Company  agrees  to issue and sell to each  Purchaser  and each
Purchaser  severally agrees to purchase from the Company the number of Units set
forth in the Agreement.

         2.       Closing Date; Delivery

                  2.1 Closing Date.  The closing of the purchase and sale of the
Units  hereunder  (the  "Closing")  shall be held at the  offices of Venture Law
Group,  P.C., 2800 Sand Hill Road,  Menlo Park,  California at 3:00 p.m., on May
28,  1997 or at such  other  time and place as the  Company  and the  Purchasers
purchasing  a majority  of the Units  shall  agree.  The date of the  Closing is
hereinafter referred to as the "Closing Date."

                  2.2 Delivery. At the Closing, the Company will deliver to each
Purchaser (a) a certificate,  registered in the Purchaser's  name and address as
shown in the Agreement, representing the number of Shares to be purchased by the
Purchaser  and (b) a Warrant  certificate,  substantially  in the form  attached
hereto as Exhibit A, representing the number of Warrants to be purchased by such
Purchaser.  Such delivery shall be against payment  therefor by wire transfer of
the  aggregate  purchase  price of the Units set  forth in the  Agreement  to an
escrow account  established  at Silicon Valley Bank by Venture Law Group,  P.C.,
escrow  agent for the Company  (the  "Escrow  Agent"),  in  accordance  with the
instructions set forth in Exhibit B hereto.  All payments received by the Escrow
Agent prior to the Closing Date shall be held in a trust account for the benefit
of the Purchasers pending Closing of the offering.

         3.       Representations and Warranties of the Company

                  The Company  represents  and warrants to the  Purchasers as of
the Closing Date as follows:

                  3.1 Organization,  Standing; Qualification to Do Business. The
Company is a corporation  duly  organized  and validly  existing  under,  and by
virtue  of, the laws of the State of  California  and is in good  standing  as a
domestic corporation under the laws of said state. The Company is duly qualified
to do  business  as a  foreign  corporation  and is in  good  standing  in  each

<PAGE>

jurisdiction  in which the ownership or leasing of its properties or the conduct
of its business requires such  qualification,  except where the failure to be so
qualified  or be in good  standing is not  reasonably  likely to have a material
adverse effect on the Company and its subsidiaries considered as one enterprise.

                  3.2  Corporate  Power;  Authorization.  The  Company  has  all
requisite legal and corporate power and has taken all requisite corporate action
to execute and deliver the  Agreement,  to sell and issue the Units and to carry
out and  perform  all of its  obligations  under the  Agreement.  The  Agreement
constitutes the legal, valid and binding obligation of the Company,  enforceable
in  accordance  with its  terms,  except  (a) as rights to  indemnification  and
contribution hereunder may be limited by applicable law, equitable principles or
public   policy,   (b)  as  limited  by   applicable   bankruptcy,   insolvency,
reorganization  or similar laws  relating to or  affecting  the  enforcement  of
creditors'  rights  generally  and  (c)  as  limited  by  equitable   principles
generally.  The  execution  and  delivery  of the  Agreement  does not,  and the
performance of the Agreement and the compliance  with the provisions  hereof and
the issuance,  sale and delivery of the Units by the Company will not materially
conflict  with,  or  result in a  material  breach or  violation  of the  terms,
conditions or provisions of, or constitute a material  default under,  or result
in the creation or imposition of any material lien pursuant to the terms of, the
Amended and Restated  Articles of  Incorporation or Bylaws of the Company or any
statute,  law,  rule or regulation  or any state or federal  order,  judgment or
decree  or any  indenture,  mortgage,  lease  or  other  material  agreement  or
instrument to which the Company or any of its properties is subject.

                  3.3 Issuance and Delivery of the Shares,  Warrants and Warrant
Shares.  The  Shares  and the  Warrants,  when  issued  in  compliance  with the
provisions of the Agreement,  and the Warrant Shares,  when issued in compliance
with the  Agreement  and the Warrants,  will be validly  issued,  fully paid and
nonassessable.  The issuance  and  delivery of the Shares,  the Warrants and the
Warrant  Shares are not subject to preemptive or any other similar rights of the
shareholders of the Company or any liens or encumbrances.

                  3.4 Private  Placement  Offering  Memorandum;  SEC  Documents;
Financial  Statements.  Each  complete  or  partial  statement,  report or proxy
statement  included as an exhibit to the Company's  Private  Placement  Offering
Memorandum dated May 14, 1997 as amended on May 16,1997 (such Private  Placement
Offering Memorandum,  including all exhibits thereto, being hereinafter referred
to as the  "Memorandum")  is a true and complete  copy of or a true excerpt from
such  document  as  filed  by the  Company  with  the  Securities  and  Exchange
Commission  (the "SEC").  The Company has filed in a timely manner all documents
that the Company was required to file with the SEC under  Sections 13, 14(a) and
15(d) of the Securities  Exchange Act of 1934, as amended (the "Exchange  Act"),
during the 12 months preceding the date of the Agreement. As of their respective
filing  dates,  all  documents  filed by the  Company  with  the SEC  (the  "SEC
Documents")  complied in all  material  respects  with the  requirements  of the
Exchange Act or the Securities Act of 1933, as amended (the  "Securities  Act"),
as  applicable.  Neither  the  Agreement,  the  Memorandum  nor  any of the  SEC
Documents  as of their  respective  dates  included  an  untrue  statement  of a
material fact or omitted to state a material fact necessary in order to make the
statements  therein,  in the light of the  circumstances  under  which they were
made, not misleading.  The financial  statements of the Company  included in the
SEC Documents or the Memorandum (the "Financial  Statements")  comply as to form
in all material  respects with applicable  accounting  requirements and with the
published rules and regulations of the SEC with respect  thereto.  The Financial
Statements have been prepared in accordance with generally  accepted  accounting

<PAGE>

principles  consistently  applied and fairly present the consolidated  financial
position  of the  Company  and any  subsidiaries  at the dates  thereof  and the
consolidated  results of their  operations and  consolidated  cash flows for the
periods then ended  (subject,  in the case of unaudited  statements,  to normal,
recurring adjustments).

                  3.5  Governmental  Consents.  No consent,  approval,  order or
authorization of, or registration,  qualification,  designation,  declaration or
filing with, any federal,  state or local governmental  authority on the part of
the Company is required in connection with the  consummation of the transactions
contemplated by the Agreement, except for (a) compliance with the securities and
blue sky laws in the  states  in which  Units are  offered  and/or  sold,  which
compliance  will be effected in accordance  with such laws,  (b) the filing of a
registration  statement and any amendments  thereto with the SEC as contemplated
by Section 7.2 of the  Agreement and (c) the filing of a  Notification  Form For
the Listing of  Additional  Shares with The Nasdaq  Stock Market and a Form 10-C
with the SEC.

                  3.6 No Material Adverse Change.  Except as otherwise disclosed
herein,  since March 31, 1997, there has not been (a) any changes in the assets,
liabilities,  financial  condition,  business  prospects  or  operations  of the
Company from that  reflected in the Financial  Statements  except changes in the
ordinary course of business which,  individually and in the aggregate,  have not
had a material adverse effect on the Company and its subsidiaries  considered as
one enterprise;  (b) any material change or amendment to a material  contract or
arrangement  by which the Company or any of its assets or properties is bound or
subject;  (c) any resignation or termination of employment,  or to the Company's
knowledge,  any impending  resignation  or  termination  of  employment,  of any
executive officer or key employee of the Company;  (d) notice of any loss of, or
the cancellation or any material order by, any material customer of the Company;
or (e) any  declaration  or payment of any  dividend  or other  distribution  of
assets of the Company.

                  3.7  Intellectual  Property.  Each  of  the  Company  and  its
subsidiaries  owns or possesses  sufficient  rights to use all material patents,
patent rights, trademarks,  copyrights,  licenses, inventions, trade secrets and
know-how  described or referred to in the  Memorandum  as owned or used by it or
that are  necessary  for the  conduct of its  business as now  conducted  and as
proposed to be conducted as described in the Memorandum; neither the Company nor
any of its subsidiaries has received any notice of, or has any knowledge of, any
infringement  of or conflict with asserted  rights of others with respect to any
patent, patent right, trademark,  copyright, invention, trade secret or know-how
that,  individually  or in the  aggregate,  if  the  subject  of an  unfavorable
decision,  ruling  or  finding,  would  have a  material  adverse  effect on the
condition (financial or otherwise),  earnings, operations,  business or business
prospects of the Company and its subsidiaries considered as one enterprise.

                  3.8 Authorized Capital Stock;  Options. The authorized capital
stock of the Company consists of (a) 25,500,000 shares of Common Stock, of which
6,048,845  shares were outstanding as of April 30, 1997 and (b) 1,000,000 shares
of Preferred  Stock,  none of which is  outstanding.  As of April 30, 1997,  the
Company had authorized  options to purchase an aggregate of 2,391,666  shares of
Common  Stock of the  Company  (the  "Options"),  of which  Options to  purchase
1,590,114  shares of Common Stock were  outstanding as of such date.  Except for
(i) the Options, (ii) 50,000 warrants,  each to purchase one share of the Common
Stock of the  Company,  issued in  connection  with the  acquisition  of certain
assets from AWA  Microelectronics  Pty.  Ltd., a subsidiary  of AWA Limited,  on
February  16,  1996,  and  (iii) as set  forth in the  Memorandum,  there are no
outstanding  options to purchase,  or any  preemptive  rights or other rights to
subscribe for or to purchase, any securities of the Company.

                  3.9 Litigation.  Except as set forth in the Memorandum,  there
are no actions, suits,  proceedings or investigations pending or, to the best of
the Company's knowledge, threatened against the Company or any of its properties
before  or by any  court or  arbitrator  or any  governmental  body,  agency  or
official  that (a) might have a material  adverse  effect on the Company and its
subsidiaries considered as one enterprise or (b) might impair the ability of the
Company to perform in any material respect its obligations under the Agreement.

                  3.10 Use of  Proceeds.  The  Company  intends to apply the net
proceeds  from the sales of the shares in the manner set forth under the caption
"Use of Proceeds" in the Memorandum.

                  3.11   Private   Placement.   Assuming  the  accuracy  of  the
representations  and  warranties  of  the  Purchasers,  and  compliance  by  the
Purchasers of all of their covenants and agreements  contained in the Agreement,
the offer,  sale and issuance by the Company of the Units to the  Purchasers  as
contemplated  in  the  Agreement   constitute   transactions   exempt  from  the
registration requirements of Section 5 of the Securities Act.

         4.       Representations, Warranties and Covenants of the Purchasers

                  Each Purchaser hereby severally  represents and warrants,  and
covenants and agrees with, to the Company, as of the Closing Date, as follows:

                  4.1  Authorization.  Purchaser  has all  requisite  legal  and
corporate or other power and capacity and has taken all  requisite  corporate or
other action to execute and deliver the  Agreement,  to purchase the Units to be
purchased  by it and to carry out and perform all of its  obligations  under the
Agreement.  The Agreement constitutes the legal, valid and binding obligation of
the Purchaser, enforceable in accordance with its terms, except (a) as rights to
indemnification  and  contribution  hereunder may be limited by applicable  law,
equitable principles or public policy, (b) as limited by applicable  bankruptcy,
insolvency,  reorganization  or  similar  laws  relating  to  or  affecting  the
enforcement  of  creditors'  rights  generally  and (c) as limited by  equitable
principles generally.

                  4.2  Investment   Experience.   Purchaser  is  an  "accredited
investor" as defined in Rule 501(a) under the Securities Act. Purchaser is aware
of the Company's business affairs and financial  condition and has had access to
and has acquired  sufficient  information about the Company to reach an informed
and knowledgeable decision to acquire the Units. Purchaser has such business and
financial  experience  as is required to give it the capacity to protect its own
interests  in  connection  with the  purchase of the Units.  Purchaser  is not a
"broker" or a "dealer" as defined in the Exchange Act and is not an  "affiliate"
of the Company as defined in the Securities Act.

<PAGE>
     
                  4.3 Investment  Intent.  Purchaser is purchasing the Units for
its own account as  principal,  for  investment  purposes  only,  and not with a
present view to, or for, resale,  distribution or fractionalization  thereof, in
whole  or  in  part,  within  the  meaning  of  the  Securities  Act.  Purchaser
understands  that its acquisition of the Units has not been registered under the
Securities  Act or registered  or qualified  under any state  securities  law in
reliance on specific  exemptions  therefrom,  which  exemptions may depend upon,
among other things,  the bona fide nature of  Purchaser's  investment  intent as
expressed herein. Purchaser has, in connection with its decision to purchase the
number of Units set forth in the  Agreement,  relied solely upon the  Memorandum
and  the  representations  and  warranties  of  the  Company  contained  herein.
Purchaser will not, directly or indirectly,  offer,  sell,  pledge,  transfer or
otherwise  dispose of (or  solicit  any  offers to buy,  purchase  or  otherwise
acquire  or take a pledge of) any of the  Shares,  Warrants  or  Warrant  Shares
except in  compliance  with the  Securities  Act and the  rules and  regulations
promulgated thereunder.

                  4.4 Registration or Exemption Requirements.  Purchaser further
acknowledges  and  understands  that the Shares,  the  Warrants  and the Warrant
Shares  may not be  resold or  otherwise  transferred  except  in a  transaction
registered   under  the   Securities  Act  or  unless  an  exemption  from  such
registration  is  available.   Purchaser   understands   that  the  certificates
evidencing  the  Shares  and  the  Warrant  Shares,  and the  Warrants,  will be
imprinted with a legend that prohibits the transfer of the Shares,  the Warrants
or the  Warrant  Shares  unless  (a)  such  transaction  is  registered  or such
registration  is not  required,  and  (b)  if the  transfer  is  pursuant  to an
exemption from registration other than Rule 144 under the Securities Act, and if
the Company shall so request in writing,  an opinion reasonably  satisfactory to
the Company of counsel reasonably satisfactory to the Company is obtained to the
effect that the transaction is so exempt.

                  4.5   Restriction   on  Sales,   Short   Sales   and   Hedging
Transactions. Purchaser will not, prior to the effectiveness of the Registration
Statement, sell, offer to sell, solicit offers to buy, dispose of, loan, pledge,
or grant any right with respect to (collectively,  a "Disposition"),  the Common
Stock  of the  Company,  nor  will  Purchaser  engage  in any  hedging  or other
transaction  which is designed to or could  reasonably be expected to lead to or
result in a  Disposition  of Common Stock of the Company by the Purchaser or any
other person or entity.  Such  prohibited  hedging or other  transactions  would
include  without  limitation  effecting  any short  sale or having in effect any
short  position  (whether  or not such sale or  position  is against the box and
regardless  of when such  position was entered  into) or any  purchase,  sale or
grant of any right  (including  without  limitation any put or call option) with
respect  to the Common  Stock of the  Company  or with  respect to any  security
(other than a broad-based  market basket or index) that includes,  relates to or
derives any significant part of its value from the Common Stock of the Company.

                  4.6 No Legal, Tax or Investment Advice.  Purchaser understands
that nothing in the Memorandum,  the Agreement or any other materials  presented
to Purchaser in connection  with the purchase and sale of the Units  constitutes
legal,  tax or investment  advice.  Purchaser has consulted such legal,  tax and
investment  advisors  as it, in its sole  discretion,  has deemed  necessary  or
appropriate in connection with its purchase of the Units.

<PAGE>

         5.       Conditions to Closing of Purchasers

                  Each  Purchaser's  obligation  to  purchase  the  Units at the
Closing  is, at the  option of such  Purchaser,  subject to the  fulfillment  or
waiver as of the Closing Date of the following conditions:

                  5.1  Representations  and Warranties.  The representations and
warranties  made by the Company in Section 3 hereof shall be true and correct in
all  material  respects  when made and shall be true and correct in all material
respects on the Closing  Date with the same force and effect as if they had been
made on and as of the Closing Date.

                  5.2  Covenants.  All  covenants,   agreements  and  conditions
contained  in the  Agreement  to be  performed by the Company on or prior to the
Closing Date shall have been performed or complied with in all respects.

     5.3 Blue Sky. The Company shall have  obtained all  necessary  blue sky law
permits and  qualifications,  or secured exemptions  therefrom,  required by any
state or foreign or other jurisdiction for the offer and sale of the Units.

         6.       Conditions to Closing of Company

                  The  Company's  obligation  to sell and issue the Units at the
Closing is, at the option of the Company,  subject to the  fulfillment or waiver
of the following conditions:

                  6.1  Representations  and Warranties.  The representations and
warranties  made by each Purchaser in Section 4 hereof shall be true and correct
in all material respects when made and shall be true and correct in all material
respects on the Closing  Date with the same force and effect as if they had been
made on and as of the Closing Date.

                  6.2  Covenants.  All  covenants,   agreements  and  conditions
contained in the Agreement to be performed by the  Purchasers on or prior to the
Closing  Date  shall  have  been  performed  or  complied  with in all  material
respects.

     6.3 Blue Sky. The Company shall have  obtained all  necessary  blue sky law
permits and  qualifications,  or secured exemptions  therefrom,  required by any
state or foreign or other jurisdiction for the offer and sale of the Units.

         7.       Affirmative Covenants

                  The Company and the Purchasers  hereby  respectively  covenant
and agree as follows:

                  7.1 Financial Information. The Company will mail the following
reports to each Purchaser until such Purchaser  transfers,  assigns or sells the
Shares, the Warrants and the Warrant Shares purchased by such Purchaser pursuant
to the Agreement:

<PAGE>

     (a) Within 100 days after the end of each fiscal year, a copy of its Annual
Report on Form 10-K.

     (b) Within 55 days after the end of the first,  second and third  quarterly
accounting  periods of each fiscal year of the Company,  a copy of its Quarterly
Report on Form 10-Q.

     (c) Within ten days after the Company files any Current  Report on Form 8-K
with the SEC, such Current Report on Form 8-K.

                  7.2      Registration Requirements.

     (a) Not later than the date which is 30 days  following  the Closing  Date,
the Company shall prepare and file a registration  statement (the  "Registration
Statement")  with the SEC under the Securities Act to register the resale of the
Shares and the Warrant Shares (collectively,  the "Registerable Securities") and
shall use its best  efforts to secure  the  effectiveness  of such  registration
statement as soon as reasonably practicable thereafter.

     (b) The Company shall pay all  Registration  Expenses (as defined below) in
connection with any  registration,  qualification or compliance  hereunder,  and
each  Purchaser  shall pay all Selling  Expenses  (as  defined  below) and other
expenses  that  are  not  Registration  Expenses  relating  to the  Registerable
Securities  resold by such  Purchaser.  "Registration  Expenses"  shall mean all
expenses, except for Selling Expenses, incurred by the Company in complying with
the registration provisions herein described, including, without limitation, all
registration,  qualification and filing fees,  printing  expenses,  escrow fees,
fees and  disbursements  of counsel for the Company,  blue sky fees and expenses
and the  expense of any  special  audits  incident  to or  required  by any such
registration.   "Selling   Expenses"   shall  mean  all   selling   commissions,
underwriting  fees and  stock  transfer  taxes  applicable  to the  Registerable
Securities and all fees and disbursements of counsel for any Purchaser.

     (c) In the case of the  registration  effected by the  Company  pursuant to
these  registration  provisions,  the Company  will use its best efforts to: (i)
keep such registration effective until the earlier of (A) the second anniversary
of the date hereof,  (B) such date as all of the  Registerable  Securities  have
been resold or (C) such time as all of the  Registerable  Securities held by the
Purchasers can be sold within a given three-month period without compliance with
the  registration  requirements  of the  Securities  Act  pursuant  to Rule  144
promulgated  thereunder  ("Rule  144");  (ii) prepare and file with the SEC such
amendments and supplements to the Registration Statement and the prospectus used
in connection with the Registration Statement as may be necessary to comply with
the  provisions of the  Securities  Act with respect to the  disposition  of all
securities covered by the Registration  Statement;  (iii) furnish such number of
prospectuses and other documents incident thereto, including any amendment of or
supplement to the  prospectus,  as a Purchaser  from time to time may reasonably
request;  (iv)  cause the  Shares  and the  Warrant  Shares to be listed on each

<PAGE>

securities  exchange  and  quoted on each  quotation  service  on which  similar
securities  issued by the  Company  are then  listed or  quoted;  (v)  provide a
transfer  agent and  registrar  for all  securities  registered  pursuant to the
Registration  Statement  and a  CUSIP  number  for  all  such  securities;  (vi)
otherwise  use its  best  efforts  to  comply  with  all  applicable  rules  and
regulations of the SEC; and (vii) file the documents required of the Company and
otherwise use its best efforts to maintain  requisite  blue sky clearance in (X)
all  jurisdictions  in which any of the Units  are  originally  sold and (Y) all
other states specified in writing by a Purchaser, provided, however, that, as to
clause  (Y),  the  Company  shall not be  required  to qualify to do business or
consent to  service of process in any state in which it is not now so  qualified
or has not so consented.

     (d) The Company shall furnish to each  Purchaser  upon request a reasonable
number of copies of a supplement  to or an amendment of the  prospectus  used in
connection  with the  Registration  Statement  as may be  necessary  in order to
facilitate  the  public  sale  or  other  disposition  of  all  or  any  of  the
Registerable Securities held by the Purchaser.

     (e) With a view to making  available to the Purchasers the benefits of Rule
144 and any other rule or  regulation  of the SEC that may at any time  permit a
Purchaser to sell Registerable  Securities to the public without registration or
pursuant to a  registration  statement  on Form S-3, the Company  covenants  and
agrees  to use its  best  efforts  to:  (i) make  and  keep  public  information
available,  as those terms are  understood  and  defined in Rule 144,  until the
earlier of (A) the second anniversary of the date hereof or (B) such date as all
of the Registerable Securities shall have been resold; (ii) file with the SEC in
a timely  manner all reports and other  documents  required of the Company under
the  Securities  Act and Exchange Act; and (iii)  furnish to any Purchaser  upon
request,  as long as the  Purchaser  owns  any  Registerable  Securities,  (A) a
written  statement  by the  Company  that it has  complied  with  the  reporting
requirements  of the Securities Act and the Exchange Act, (B) a copy of the most
recent annual or quarterly report of the Company, and (C) such other information
as may be  reasonably  requested in order to avail any  Purchaser of any rule or
regulation  of the  SEC  that  permits  the  selling  of any  such  Registerable
Securities  without  registration or pursuant to such registration  statement on
Form S-3.

     (f) If any  Purchaser  shall  propose to sell any  Registerable  Securities
pursuant  to the  Registration  Statement,  it shall  notify the  Company of its
intent to do so at least two (2) full  business  days prior to such  sale.  Such
notice  shall  be  deemed  to  constitute  a  representation  that  any  written
information  previously supplied by such Purchaser (including without limitation
the information referred to in Section 8.4 hereof) is accurate as of the date of
such notice.  At any time within such two (2) business-day  period,  the Company
may  refuse to  permit  the  Purchaser  to resell  any  Registerable  Securities
pursuant  to the  Registration  Statement  for an  initial  period not to exceed
fifteen (15) days; provided,  however, that in order to exercise this right, the
Company must  deliver a  certificate  in writing to the  Purchaser to the effect
that a  delay  in  such  sale  is  necessary  because  a sale  pursuant  to such
Registration  Statement  in its  then-current  form  would  not  be in the  best
interests of the Company and its shareholders  due to disclosure  obligations of
the Company.  In such an event,  the Company shall use its best efforts to amend
the Registration  Statement if necessary and to take all other actions necessary
to allow  such  sale,  and shall  notify  the  Purchaser  promptly  after it has
determined that such sale has become permissible. Notwithstanding the foregoing,
the  Company  shall  not be  entitled  to  exercise  its right to  withdraw  the
registration  statement  more than three (3) times in any  calendar  year or for
more than two  consecutive  fifteen (15) day periods in any calendar year.  Each
Purchaser  hereby  covenants  and agrees that it will not sell any  Registerable

<PAGE>

Securities  pursuant  to the  Registration  Statement  during  the  periods  the
Registration Statement is withdrawn as set forth in this Section 7.2(f).

                  7.3      Indemnification and Contribution.

     (a) The Company  agrees to indemnify and hold harmless each  Purchaser from
and  against  any  losses,   claims,  damages  or  liabilities  (or  actions  or
proceedings  in respect  thereof)  to which such  Purchaser  may become  subject
(under the Securities Act or otherwise) insofar as such losses,  claims, damages
or liabilities  (or actions or proceedings in respect  thereof) arise out of, or
are based upon,  any untrue  statement of a material fact or omission to state a
material fact in the  Registration  Statement on the effective date thereof,  or
arise out of any failure by the Company to fulfill any  undertaking  included in
the Registration  Statement,  and the Company will, as incurred,  reimburse such
Purchaser for any legal or other expenses  reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; provided,
however,  that the  Company  shall not be liable in any such case to the  extent
that such loss,  claim,  damage or liability arises out of, or is based upon (i)
an untrue statement or omission in such Registration  Statement in reliance upon
and in  conformity  with written  information  furnished to the Company by or on
behalf of such Purchaser specifically for use in preparation of the Registration
Statement,  (ii) the failure of such  Purchaser to comply with the covenants and
agreements  contained in Sections 7.2(f),  8.3 or 8.4 hereof, or (iii) an untrue
statement or omission in any  prospectus  that is  corrected  in any  subsequent
prospectus,  or  supplement  or  amendment  thereto,  that was  delivered to the
Purchaser prior to the pertinent sale or sales by the Purchaser.

     (b) Each Purchaser, severally and not jointly, agrees to indemnify and hold
harmless the Company from and against any losses, claims, damages or liabilities
(or actions or proceedings  in respect  thereof) to which the Company may become
subject (under the Securities Act or otherwise) insofar as such losses,  claims,
damages or liabilities (or actions or proceedings in respect  thereof) arise out
of, or are based upon (i) an untrue  statement of a material fact or omission to
state a material  fact in the  Registration  Statement  in reliance  upon and in
conformity with written information  furnished to the Company by or on behalf of
such  Purchaser   specifically  for  use  in  preparation  of  the  Registration
Statement; provided, however, that no Purchaser shall be liable in any such case
for any untrue  statement or omission in any prospectus which statement has been
corrected, in writing, by such Purchaser and delivered to the Company before the
sale from which such loss occurred, (ii) the failure of such Purchaser to comply
with the  covenants  and  agreements  contained in Sections  7.2(f),  8.3 or 8.4
hereof,  or (iii) an untrue  statement  or  omission in any  prospectus  that is
corrected in any subsequent prospectus, or supplement or amendment thereto, that
was  delivered  to the  Purchaser  prior to the  pertinent  sale or sales by the
Purchaser,  and each  Purchaser,  severally and not jointly,  will, as incurred,
reimburse  the Company for any legal or other  expenses  reasonably  incurred in
investigating,  defending or preparing to defend any such action,  proceeding or
claim.

     (c) Promptly after receipt by any indemnified person of a notice of a claim
or the  beginning  of any action in respect of which  indemnity  is to be sought
against an indemnifying  person  pursuant to this Section 7.3, such  indemnified
person shall notify the  indemnifying  person in writing of such claim or of the

<PAGE>

commencement of such action, and, subject to the provisions  hereinafter stated,
in case any such action shall be brought  against an indemnified  person and the
indemnifying  person shall have been notified thereof,  the indemnifying  person
shall be entitled to participate therein, and, to the extent that it shall wish,
to assume the defense  thereof,  with  counsel  reasonably  satisfactory  to the
indemnified   person.   After  notice  from  the  indemnifying  person  to  such
indemnified  person of the indemnifying  person's election to assume the defense
thereof,  the indemnifying person shall not be liable to such indemnified person
for any legal  expenses  subsequently  incurred  by such  indemnified  person in
connection with the defense thereof; provided,  however, that if there exists or
shall  exist a conflict  of  interest  that would make it  inappropriate  in the
reasonable  judgment of the indemnified person for the same counsel to represent
both the  indemnified  person and such  indemnifying  person or any affiliate or
associate  thereof,  the indemnified  person shall be entitled to retain its own
counsel at the expense of such indemnifying person.

     (d) If the indemnification  provided for in this Section 7.3 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses,  claims,  damages or liabilities (or actions
or proceedings in respect thereof)  referred to therein,  then each indemnifying
party shall contribute to the amount paid or payable by such  indemnified  party
as result of such losses,  claims, damages or liabilities (or actions in respect
thereof) in such  proportion as is  appropriate to reflect the relative fault of
the Company on the one hand and the  Purchasers on the other in connection  with
the statements or omissions  which resulted in such losses,  claims,  damages or
liabilities  (or  actions in  respect  thereof),  as well as any other  relevant
equitable  considerations.  The relative  fault shall be determined by reference
to,  among other  things,  whether the untrue or alleged  untrue  statement of a
material  fact or the  omission  or alleged  omission  to state a material  fact
relates to information supplied by the Company on the one hand or a Purchaser on
the other and the parties' relative intent, knowledge, access to information and
opportunity  to correct or prevent such  statement or omission.  The Company and
the  Purchasers  agree that it would not be just and  equitable if  contribution
pursuant to this subsection (d) were determined by pro rata allocation  (even if
the  Purchasers  were  treated as one entity for such  purpose)  or by any other
method  of   allocation   which  does  not  take  into  account  the   equitable
considerations  referred  to above in this  subsection  (d).  The amount paid or
payable by an indemnified  party as a result of the losses,  claims,  damages or
liabilities (or actions in respect thereof) referred to above in this subsection
(d) shall be deemed to include any legal or other expenses  reasonably  incurred
by such indemnified party in connection with investigating or defending any such
action or claim.  Notwithstanding  the  provisions  of this  subsection  (d), no
Purchaser  shall be required to contribute any amount in excess of the amount by
which the net amount  received by the  Purchaser  from the sale of the Shares or
Warrant  Shares,  as the case may be, to which  such loss  relates  exceeds  the
amount of any damages which such Purchaser has otherwise been required to pay by
reason of such  untrue or  alleged  untrue  statement  or  omission  or  alleged
omission. No person guilty of fraudulent  misrepresentation  (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to  contribution  from
any  person  who  was  not  guilty  of such  fraudulent  misrepresentation.  The
Purchasers'  obligations  in this  subsection  (d) to contribute  are several in
proportion to their  respective  sales of Shares or Warrant Shares,  as the case
may be, to which such loss relates and not joint.

     (e) The  obligations of the Company and the  Purchasers  under this Section
7.3 shall be in addition to any liability  which the Company and the  respective

<PAGE>

Purchasers  may  otherwise  have and  shall  extend,  upon the  same  terms  and
conditions,  to each person,  if any, who controls the Company or any  Purchaser
within the meaning of the Securities Act and the Exchange Act.

     8. Restrictions on Transferability of Shares,  Warrants and Warrant Shares;
Compliance with Securities Act.

                  8.1 Restrictions on Transferability.  The Shares, the Warrants
and the Warrant Shares shall not be  transferable in the absence of registration
under  the  Securities  Act  or an  exemption  therefrom  or in the  absence  of
compliance with any term of the Agreement. The Company shall be entitled to give
stop transfer instructions to its transfer agent with respect to the Shares, the
Warrants and the Warrant Shares in order to enforce the foregoing restrictions.

     8.2 Restrictive  Legend.  Each  certificate  representing  the Shares,  the
Warrants and the Warrant Shares shall bear  substantially  the following legends
(in addition to any legends required under applicable state securities laws):

                  THE  SECURITIES  REPRESENTED  BY THIS  CERTIFICATE  HAVE  BEEN
                  ACQUIRED  FOR  INVESTMENT  PURPOSES  ONLY  AND  HAVE  NOT BEEN
                  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933. THE SECURITIES
                  MAY  NOT BE  SOLD  OR  TRANSFERRED  IN  THE  ABSENCE  OF  SUCH
                  REGISTRATION OR AN EXEMPTION THEREFROM.

                  ADDITIONALLY,  THE TRANSFER OF THE  SECURITIES  REPRESENTED BY
                  THIS CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS  SPECIFIED
                  IN A UNIT  PURCHASE  AGREEMENT  DATED MAY 16, 1997 BETWEEN THE
                  COMPANY  AND  THE  ORIGINAL  PURCHASER,  AND  NO  TRANSFER  OF
                  SECURITIES SHALL BE VALID OR EFFECTIVE ABSENT  COMPLIANCE WITH
                  SUCH RESTRICTIONS.  ALL SUBSEQUENT HOLDERS OF THIS CERTIFICATE
                  WILL HAVE  AGREED TO BE BOUND BY  CERTAIN  OF THE TERMS OF THE
                  AGREEMENT,   INCLUDING  SECTIONS  7.2,  8.3  AND  8.4  OF  THE
                  AGREEMENT.  A COPY OF THE AGREEMENT MAY BE OBTAINED AT NO COST
                  BY  WRITTEN  REQUEST  MADE BY THE  REGISTERED  HOLDER  OF THIS
                  CERTIFICATE TO THE SECRETARY OF THE COMPANY.

                  8.3  Transfer of Shares,  Warrants  and Warrant  Shares.  Each
Purchaser  hereby covenants with the Company not to make any sale of the Shares,
the Warrants or the Warrant Shares except either (a) a sale of Shares or Warrant
Shares  in  accordance  with  the  Registration  Statement,  in  which  case the
Purchaser  covenants  to comply with the  requirement  of  delivering  a current
prospectus,  (b) a sale of Shares, Warrants or Warrant Shares in accordance with
Rule 144, in which case the Purchaser  covenants to comply with Rule 144, or (c)
subject to such conditions as the Company in its sole  discretion  shall impose,
in accordance with another  exemption from the registration  requirements of the
Securities Act. Each Purchaser further acknowledges and agrees that such Shares,
Warrants  and Warrant  Shares are not  transferable  on the books of the Company

<PAGE>

unless the certificate submitted to the Company's transfer agent evidencing such
Shares,   Warrants  or  Warrant  Shares  is   accompanied  by  such   additional
certification,   documentation  or  information  as  the  Company  in  its  sole
discretion  shall  require in order to effect such sale in  accordance  with the
Registration  Statement,  Rule 144 or such other exemption from the registration
requirements of the Securities  Act. No transfer of Shares,  Warrants or Warrant
Shares  will be  effected  to any  "affiliate"  of the Company as defined in the
Securities Act except  pursuant to subsection (a) or (b) hereof.  The legend set
forth in Section 8.2 will be removed  from a  certificate  representing  Shares,
Warrants or Warrant Shares  following and in connection with any sale of Shares,
Warrants or Warrant  Shares,  as the case may be,  pursuant to subsection (a) or
(b) hereof but not in  connection  with any sale of Shares,  Warrants or Warrant
Shares, as the case may be, pursuant to subsection (c) or (d) hereof.

     8.4 Purchaser  Information.  Each Purchaser covenants that it will promptly
notify  the  Company  of  any  changes  in  the  information  set  forth  in the
Registration  Statement  regarding such Purchaser or such  Purchaser's  "Plan of
Distribution."

         9.       Miscellaneous

                  9.1 Waivers and  Amendments.  With the exception of Sections 7
and 8 hereof,  the terms of the  Agreement  may be  waived or  amended  with the
written  consent of the Company and each  Purchaser.  With respect to Sections 7
and 8 hereof,  with the written consent of the Company and the record holders of
more than 50% of the Shares then outstanding and held by Purchasers  (including,
for  purposes  of such  calculation,  outstanding  Warrant  Shares and shares of
Common Stock issuable upon exercise of outstanding  Warrants),  the terms of the
Agreement  may be waived or amended and any such  amendment  or waiver  shall be
binding upon the Company and all holders of Shares, Warrants or Warrant Shares.

                  9.2 Broker's Fee. Each Purchaser acknowledges that the Company
intends to pay a fee to Needham & Company, Inc.  ("Needham"),  in respect of the
sale  of the  Units  to  the  Purchasers.  Each  of the  parties  hereto  hereby
represents  that,  on the basis of any actions and  agreements by it, and except
for certain  finders to be paid a fee out of Needham's  fee,  there are no other
brokers or finders  entitled to  compensation in connection with the sale of the
Units to the Purchasers.

     9.3 Governing  Law. The Agreement  shall be governed in all respects by and
construed in accordance with the laws of the State of California  without regard
to conflicts of laws principles.

                  9.4 Survival. The representations,  warranties,  covenants and
agreements  made in the Agreement  shall survive any  investigation  made by the
Company or the Purchasers and shall survive the Closing.

                  9.5 Successors and Assigns.  The provisions hereof shall inure
to the  benefit  of,  and be  binding  upon,  the  successors,  assigns,  heirs,
executors and  administrators  of the parties to the Agreement.  Notwithstanding
the foregoing, no Purchaser shall assign the Agreement without the prior written
consent of the Company.  The  provisions  of Sections 7, 8 and 9 hereof shall be

<PAGE>

binding  on and shall  inure to the  benefit  of  subsequent  holders of Shares,
Warrants or Warrant Shares, other than subsequent holders purchasing pursuant to
Section 8.3(a) or 8.3(b).

     9.6  Entire  Agreement.  The  Agreement  constitutes  the full  and  entire
understanding  and  agreement  between the parties  with regard to the  subjects
hereof.

                  9.7  Indemnification  of Escrow Agent. The Company and each of
the  Purchasers  jointly and  severally  agree to  indemnify  and hold  harmless
Venture Law Group,  P.C.  ("VLG") against any and all losses,  claims,  damages,
liabilities,  costs, expenses and disbursements  (including fees and expenses of
counsel)  (collectively,  "Losses")  arising out of or in connection  with VLG's
services hereunder, other than Losses finally judicially determined to be solely
attributable to VLG's bad faith or gross negligence. Each of the Company and the
Purchasers  further  agree  that VLG  shall  not have any  liability  whatsoever
(whether direct or indirect, in contract or tort or otherwise) to the Company or
any Purchaser (or any party  claiming  through either of them) arising out of or
in  connection  with its  services  hereunder  except  in the  event  that  such
liability is finally  judicially  determined to be solely  attributable to VLG's
bad faith or gross negligence. The Company and the Purchasers further agree that
VLG shall be entitled to rely on their respective  representations,  warranties,
covenants  and  agreements  herein and  pursuant  hereto.  The  Company  and the
Purchasers acknowledge and agree that VLG is an intended third-party beneficiary
of this Section 9.7.

                  9.8  Notices,   etc.  All  notices  and  other  communications
required  or  permitted  under  the  Agreement  shall be in  writing  and may be
delivered in person,  by telecopy,  overnight  delivery service or United States
mail,  addressed to the Company or the Purchasers,  as the case may be, at their
respective addresses set forth at the beginning of in the Agreement,  or at such
other address as the Company or the Purchasers shall have furnished to the other
party in writing.  All notices and other  communications shall be effective upon
the  earlier of (a)  actual  receipt  thereof  by the  person to whom  notice is
directed or (b) (i) in the case of notices and  communications  sent by personal
delivery  or  telecopy,  the time such  notice or  communication  arrives at the
applicable  address or is successfully  sent to the applicable  telecopy number,
(ii) in the  case of  notices  and  communications  sent by  overnight  delivery
service,  at noon (local time) on the second business day following the day such
notice  or  communication  is  sent,  and  (iii)  in the  case  of  notices  and
communications  sent by United  States  mail,  five days  after  such  notice or
communication is deposited in the United States mail.

                  9.9  Severability  of the  Agreement.  If any provision of the
Agreement   shall  be   judicially   determined   to  be  invalid,   illegal  or
unenforceable,  the  validity,  legality  and  enforceability  of the  remaining
provisions shall not in any way be affected or impaired thereby.

     9.10  Counterparts.  The  Agreement  may  be  executed  in  any  number  of
counterparts,  each of which  shall be an  original,  but all of which  together
shall constitute one instrument.

                  9.11 Further Assurances.  Each party to the Agreement shall do
and perform or cause to be done and  performed  all such further acts and things
and  shall  execute  and  deliver  all  such  other  agreements,   certificates,
instruments  and documents as the other party hereto may  reasonably  request in

<PAGE>

order to carry out the intent and  accomplish  the purposes of the Agreement and
the consummation of the transactions contemplated hereby.

                  9.12 Termination. In the event that the Closing shall not have
occurred on or before ninety (90) days from the date hereof, the Agreement shall
terminate at the close of business on such date.

                  9.13 Expenses.  The Company and each such Purchaser shall bear
its own expenses  incurred on its behalf with respect to the  Agreement  and the
transactions contemplated hereby, including fees of legal counsel.

     9.14 Currency. All references to "dollars" or "$" in the Agreement shall be
deemed to refer to United States dollars.


<PAGE>



                                    EXHIBIT A

                           FORM OF WARRANT CERTIFICATE



<PAGE>



         THE SECURITIES  REPRESENTED BY THIS  CERTIFICATE HAVE BEEN ACQUIRED FOR
         INVESTMENT  PURPOSES  ONLY  AND  HAVE NOT  BEEN  REGISTERED  UNDER  THE
         SECURITIES  ACT OF 1933.  THE SECURITIES MAY NOT BE SOLD OR TRANSFERRED
         IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM.

         ADDITIONALLY,  THE  TRANSFER  OF THE  SECURITIES  REPRESENTED  BY  THIS
         CERTIFICATE  IS  SUBJECT TO CERTAIN  RESTRICTIONS  SPECIFIED  IN A UNIT
         PURCHASE  AGREEMENT  DATED MAY 16,  1997  BETWEEN  THE  COMPANY AND THE
         ORIGINAL  PURCHASER,  AND NO TRANSFER OF  SECURITIES  SHALL BE VALID OR
         EFFECTIVE  ABSENT  COMPLIANCE  WITH SUCH  RESTRICTIONS.  ALL SUBSEQUENT
         HOLDERS OF THIS  CERTIFICATE WILL HAVE AGREED TO BE BOUND BY CERTAIN OF
         THE TERMS OF THE AGREEMENT,  INCLUDING SECTIONS 7.2, 8.3 AND 8.4 OF THE
         AGREEMENT.  A COPY  OF THE  AGREEMENT  MAY BE  OBTAINED  AT NO  COST BY
         WRITTEN  REQUEST MADE BY THE REGISTERED  HOLDER OF THIS  CERTIFICATE TO
         THE SECRETARY OF THE COMPANY.

         CUSIP: 74758B104

                      WARRANT TO PURCHASE SHARES OF COMMON
                      STOCK OF QUALITY SEMICONDUCTOR, INC.

         This certifies that _____________  (the "Holder"),  for value received,
is  entitled  to  purchase  from  Quality  Semiconductor,   Inc.,  a  California
corporation (the "Company"), ____________ (_______) fully paid and nonassessable
shares of the Company's Common Stock (the "Warrant  Shares") at a price of $8.50
per share of Common Stock (the "Stock Purchase  Price") at any time or from time
to time on or after the date hereof up to and including 5:00 p.m. (Pacific time)
on the Expiration Date (as defined below),  upon surrender to the Company at its
principal office at 851 Martin Avenue, Santa Clara, California 95050-2903 (or at
such other  location  as the  Company  may advise the Holder in writing) of this
Warrant  properly  endorsed with the Form of  Subscription  attached hereto duly
completed  and  signed  and upon  payment  by cash,  check or wire  transfer  of
immediately available funds of the aggregate Stock Purchase Price for the number
of shares for which this Warrant is being  exercised  determined  in  accordance
with the  provisions  hereof.  The Stock Purchase Price and the number of shares
purchasable hereunder are subject to adjustment as provided in Section 3 of this
Warrant.  "Expiration  Date"  means the  earlier of (i) May 31, 1998 or (ii) the
occurrence of an event the proposal of which is described in  subsection  (d) of
Section 3.4 which causes  termination  of this Warrant  under  Section 3.4. This
Warrant is issued  pursuant to the Unit Purchase  Agreement  between the Company
and the Holder dated May 16, 1997 (the "Purchase Agreement").

<PAGE>

         This Warrant is subject to the following terms and conditions:

         1. Exercise; Issuance of Certificates; Payment for Shares. This Warrant
is  exercisable  at the option of the Holder at any time or from time to time on
or after the date  hereof  and prior to or on the  Expiration  Date for all or a
portion of the Warrant Shares which may be purchased hereunder. The Holder shall
not be  entitled  to  exercise  this  Warrant  without  delivering  the  Form of
Subscription attached hereto, and the Company shall have no liability whatsoever
to any  Holder  by  reason  of any  attempted  exercise  hereof  if such Form of
Subscription  is not  delivered  or such  Holder  is  unable  to make any of the
representations  set forth  therein.  The Company agrees that the Warrant Shares
purchased  under this Warrant shall be and are deemed to be issued to the Holder
as the record  owner of such  shares as of the close of  business on the date on
which this Warrant shall have been surrendered and payment made for such shares.
Subject to the provisions of Section 2,  certificates  for the Warrant Shares so
purchased, together with any other securities or property to which the Holder is
entitled upon such  exercise,  shall be delivered to the Holder by the Company's
transfer  agent at the  Company's  expense  within a  reasonable  time after the
rights  represented by this Warrant have been exercised.  Each stock certificate
so  delivered  shall  be in  such  denominations  of  Warrant  Shares  as may be
requested  by the  Holder and shall be  registered  in the name of the Holder or
such other name as shall be designated by the Holder, subject to the limitations
contained in Sections 2 and 4 hereof.  If, upon exercise of this Warrant,  fewer
than all of the Warrant Shares  evidenced by this Warrant are purchased prior to
the date of expiration of this Warrant,  one or more new warrants  substantially
in the form of,  and on the  terms  in,  this  Warrant  will be  issued  for the
remaining number of Warrant Shares not purchased upon exercise of this Warrant.

         2.  Shares  to be  Fully  Paid;  Reservation  of  Shares.  The  Company
covenants  and  agrees  that all  Warrant  Shares  which may be issued  upon the
exercise of the rights represented by this Warrant will, upon issuance,  be duly
authorized,  validly  issued,  fully  paid and  nonassessable  and free from all
preemptive  rights of any shareholder  and free of all taxes,  liens and charges
with respect to the issue thereof. The Company further covenants and agrees that
it shall  approve,  and shall seek  shareholder  approval at its next  regularly
scheduled  meeting of shareholders  for, an increase in the number of authorized
shares of Common  Stock  sufficient  to provide  for the  exercise of the rights
represented  by this  Warrant.  Thereafter,  during the period  within which the
rights  represented by this Warrant may be exercised,  the Company covenants and
agrees that it will at all times have  authorized and reserved,  for the purpose
of issue or transfer upon exercise of the subscription  rights evidenced by this
Warrant,  a sufficient number of shares of authorized but unissued Common Stock,
when and as required to provide for the  exercise of the rights  represented  by
this Warrant.  The Company will use its reasonable best efforts to take all such
action as may be  necessary  to assure that such  shares of Common  Stock may be
issued as provided herein without violation of any applicable law or regulation,
or of  any  requirements  of  any  domestic  securities  exchange  or  automated
quotation system upon which the Common Stock may be listed.

         3.  Adjustment of Stock Purchase Price;  Number of Warrant Shares.  The
Stock  Purchase  Price and the number of  Warrant  Shares  purchasable  upon the
exercise of this Warrant shall be subject to  adjustment  from time to time upon
the occurrence of certain events described in this Section 3.

<PAGE>

                  3.1  Adjustment  of  Purchase  Price.  In the  event  that the
Company  at any time or from time to time  after the  issuance  of this  Warrant
shall declare or pay,  without  consideration,  any dividend on the Common Stock
pa yable  in  Common  Stock  or in any  right  to  acquire Common  Stock  for no
consideration, or shall effect a subdivision of the outstanding shares of Common
Stock  into a  greater  number of  shares  of  Common  Stock  (by  stock  split,
reclassification  or otherwise  than by payment of a dividend in Common Stock or
in any right to acquire Common Stock), or in the event the outstanding shares of
Common  Stock  shall  be  combined  or  consolidated,   by  reclassification  or
otherwise,  into a lesser  number  of shares  of  Common  Stock,  then the Stock
Purchase  Price in effect  immediately  prior to such event shall,  concurrently
with the effectiveness of such event, be proportionately decreased or increased,
as  appropriate.  In the event that the Company  shall  declare or pay,  without
consideration,  any dividend on the Common Stock payable in any right to acquire
Common Stock for no consideration, then the Company shall be deemed to have made
a dividend  payable in Common  Stock in an amount of shares equal to the maximum
number of shares  issuable upon exercise of such rights to acquire Common Stock.
Upon each  adjustment of the Stock  Purchase Price pursuant to this Section 3.1,
the Holder shall thereafter be entitled to purchase, at the Stock Purchase Price
resulting from such adjustment, the number of shares of Common Stock obtained by
multiplying  the  Stock  Purchase  Price  in  effect  immediately  prior to such
adjustment by the number of shares of Common Stock  purchasable  pursuant hereto
immediately  prior to such  adjustment,  and dividing the product thereof by the
Stock Purchase Price resulting from such adjustment.

                  3.2 Adjustments for  Reclassification  and Reorganization.  If
the Common Stock shall be changed into the same or a different  number of shares
of any other  class or  classes of stock,  whether  by  capital  reorganization,
reclassification or otherwise (other than a subdivision or combination of shares
provided for in Section  3.1),  the Stock  Purchase  Price then in effect shall,
concurrently with the effectiveness of such reorganization or  reclassification,
be  proportionately  adjusted so that this Warrant shall  represent the right to
purchase,  in lieu of the number of shares of Common  Stock  which this  Warrant
would otherwise  represent the right to purchase,  that number of shares of such
other  class or  classes of stock  equivalent  to the number of shares of Common
Stock which this Warrant  would have  otherwise  entitled the Holder to purchase
immediately before that change at the same aggregate Stock Purchase Price.

                  3.3 Notice of  Adjustment.  Upon any  adjustment  of the Stock
Purchase  Price or any  increase  or  decrease in the number of shares of Common
Stock  purchasable  upon the exercise of this Warrant,  the Company shall within
five business days give written  notice  thereof,  by first class mail,  postage
prepaid,  addressed to the  registered  Holder of this Warrant at the address of
such Holder as shown on the books of the Company.  The notice shall be signed by
the Company's chief  financial  officer and shall state the Stock Purchase Price
resulting  from such  adjustment  and the increase or  decrease,  if any, in the
number of shares  purchasable  at such price upon the exercise of this  Warrant,
setting forth in reasonable  detail the method of calculation and the facts upon
which such calculation is based.

                  3.4      Other Notices.  If at any time:

     (a) the Company  shall propose to declare any cash dividend upon its Common
Stock;

<PAGE>

     (b) the  Company  shall  propose to declare or make any  dividend  or other
distribution  to the holders of its Common Stock,  whether in cash,  property or
other securities;

     (c)  the   Company   shall   propose  to  effect  any   reorganization   or
reclassification  of the capital  stock of the Company or any  consolidation  or
merger of the  Company  with or into  another  corporation  in which the Company
shall not be the continuing or surviving entity of such consolidation or merger,
or any  transaction or series of  transactions  in which an excess of 50% of the
Company's  voting power is transferred,  or any sale, lease or conveyance of all
or substantially all of the property of the Company; or

     (d) the  Company  shall  propose  to  effect  a  voluntary  or  involuntary
dissolution, liquidation or winding-up of the Company;

then, in any one or more of said cases,  the Company shall give, by certified or
registered mail, postage prepaid, addressed to the Holder at the address of such
Holder as shown on the books of the Company (i) at least 15 business days' prior
written  notice of the date on which the books of the  Company  shall close or a
record  shall be taken for such  dividend  or  distribution  or for  determining
rights  to  vote  in  respect  of  any  such  reorganization,  reclassification,
consolidation,  merger,  transaction  or series of  transactions,  sale,  lease,
conveyance, dissolution,  liquidation or winding-up, and (ii) in the case of any
such reorganization,  reclassification,  consolidation,  merger,  transaction or
series of transactions,  sale, lease,  conveyance,  dissolution,  liquidation or
winding-up,  at least 15 business days' written notice of the date when the same
shall take place.  Any notice  given in  accordance  with clause (i) above shall
also specify,  in the case of any dividend or distribution,  the record date for
such dividend or distribution,  which must be after the date thereof. Any notice
given in accordance  with clause (ii) above shall also specify the date on which
the holders of the Common Stock shall be entitled to exchange their Common Stock
for securities or other property,  if any, deliverable upon such reorganization,
reclassification,  consolidation, merger, transaction or series of transactions,
sale, lease, conveyance, dissolution, liquidation or winding-up, as the case may
be. In the event that the Holder does not  exercise  this  Warrant  prior to the
occurrence  of an event  described in clause (a) or (b) above,  the Holder shall
not be  entitled  to receive the  benefits  accruing to existing  holders of the
Common Stock in such event.  Upon the occurrence of an event described in clause
(c), the Holder shall be entitled thereafter, in lieu of and in substitution for
all other rights under this Warrant, upon payment of the Stock Purchase Price in
effect  immediately  prior to such  action,  to receive  upon  exercise  of this
Warrant the class and number of shares which the Holder would have been entitled
to receive after the  occurrence  of such event had this Warrant been  exercised
immediately prior to such event. Upon the occurrence of an event the proposal of
which is described in clause (d), this Warrant shall terminate.

         4. Issue Tax. The issuance of certificates  for the Warrant Shares upon
the exercise of this Warrant shall be made without  charge to the Holder for any
issue tax in respect thereof;  provided,  however, that the Company shall not be
required to pay any tax which may be payable in respect of any transfer involved
in the issuance and delivery of any certificate in a name other than that of the
then holder of this Warrant being exercised.

<PAGE>

         5. No Voting or  Dividend  Rights;  Limitation  of  Liability.  Nothing
contained in this  Warrant  shall be  construed  as  conferring  upon the Holder
hereof the right to vote or to consent or to receive  notice as a shareholder in
respect of meetings of shareholders for the election of directors of the Company
or any other matters or any rights  whatsoever as a shareholder  of the Company.
Except for the adjustment to the Stock Purchase Price pursuant to Section 3.1 in
the event of a dividend on the Common Stock  payable in shares of Common  Stock,
no dividends or interest  shall be payable or accrued in respect of this Warrant
or the interest  represented hereby or the Warrant Shares purchasable  hereunder
until,  and only to the extent that, this Warrant shall have been exercised.  No
provisions  hereof,  in the  absence  of  affirmative  action  by the  Holder to
purchase  Warrant  Shares,  and no mere  enumeration  herein  of the  rights  or
privileges of the Holder hereof, shall give rise to any liability of such Holder
for the Stock  Purchase  Price or as a shareholder  of the Company  whether such
liability is asserted by the Company or by its creditors.

     6.  Restrictions  on   Transferability   of  Securities;   Compliance  With
Securities Act.

                  6.1  Restrictions  on  Transferability.  The  Warrant  and the
Warrant  Shares  (collectively,  the  "Securities"),  shall not be  transferable
except upon the conditions specified in the Purchase Agreement, which conditions
are intended to insure  compliance with the provisions of the Securities Act and
applicable "blue sky" law.

                  6.2 Restrictive  Legend.  Each  certificate  representing  the
Securities or any other securities  issued in respect of the Securities upon any
stock split, stock dividend, recapitalization,  merger, consolidation or similar
event shall  (unless  otherwise  permitted  by the  provisions  of the  Purchase
Agreement) be stamped or otherwise imprinted with a legend  substantially in the
following  form (in  addition  to any legend  required  under  applicable  state
securities laws):

                  THE  SECURITIES  REPRESENTED  BY THIS  CERTIFICATE  HAVE  BEEN
                  ACQUIRED  FOR  INVESTMENT  PURPOSES  ONLY  AND  HAVE  NOT BEEN
                  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933. THE SECURITIES
                  MAY  NOT BE  SOLD  OR  TRANSFERRED  IN  THE  ABSENCE  OF  SUCH
                  REGISTRATION OR AN EXEMPTION THEREFROM.

                  ADDITIONALLY,  THE TRANSFER OF THE  SECURITIES  REPRESENTED BY
                  THIS CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS  SPECIFIED
                  IN A UNIT  PURCHASE  AGREEMENT  DATED MAY 16, 1997 BETWEEN THE
                  COMPANY  AND  THE  ORIGINAL  PURCHASER,  AND  NO  TRANSFER  OF
                  SECURITIES SHALL BE VALID OR EFFECTIVE ABSENT  COMPLIANCE WITH
                  SUCH RESTRICTIONS.  ALL SUBSEQUENT HOLDERS OF THIS CERTIFICATE
                  WILL HAVE  AGREED TO BE BOUND BY  CERTAIN  OF THE TERMS OF THE
                  AGREEMENT,   INCLUDING  SECTIONS  7.2,  8.3  AND  8.4  OF  THE
                  AGREEMENT.  A COPY OF THE AGREEMENT MAY BE OBTAINED AT NO COST
                  BY  WRITTEN  REQUEST  MADE BY THE  REGISTERED  HOLDER  OF THIS
                  CERTIFICATE TO THE SECRETARY OF THE COMPANY.

<PAGE>

     7.  Modification  and Waiver.  This Warrant and any provision hereof may be
changed,  waived,  discharged  or  terminated  only by an  instrument in writing
signed by the party against which enforcement of the same is sought.

         8.  Notices.  Any notice,  request or other  communication  required or
permitted to be given or delivered to the Holder  hereof or the Company shall be
in writing and may,  except as  otherwise  set forth  herein,  be  delivered  in
person, by telecopy, overnight delivery service or United States mail, addressed
to the  Holder at its  address as shown on the books of the  Company,  or to the
Company  at the  address  indicated  therefor  in the  first  paragraph  of this
Warrant,  or at such  other  address  as the  Holder or the  Company  shall have
furnished  to the  other  party in  writing.  All  notices,  requests  and other
communications shall be effective upon the earlier of (a) actual receipt thereof
by the person to whom  notice is  directed  or (b) (i) in the case of notices or
communications  sent by personal  delivery or telecopy,  the time such notice or
communication  arrives at the applicable  address or is successfully sent to the
applicable  telecopy number, (ii) in the case of notices and communications sent
by overnight  delivery service,  at noon (local time) on the second business day
following the day such notice or communication is sent, and (iii) in the case of
notices and  communications  sent by United  States  mail,  five days after such
notice or communication is deposited in the United States mail.

         9. Descriptive  Headings and Governing Law. The descriptive headings of
the several sections and paragraphs of this Warrant are inserted for convenience
only  and do not  constitute  a part of this  Warrant.  This  Warrant  shall  be
governed in all  respects by and  construed in  accordance  with the laws of the
State of California without regard to conflicts of laws principles.

         10. Lost Warrants or Stock  Certificates.  The Company  represents  and
warrants to the Holder that upon receipt of evidence reasonably  satisfactory to
the Company of the loss,  theft,  destruction,  or  mutilation of any Warrant or
stock certificate and, in the case of any such loss, theft or destruction,  upon
receipt of an indemnity and, if requested,  bond reasonably  satisfactory to the
Company or, in the case of any such mutilation  upon surrender and  cancellation
of such Warrant or stock  certificate,  the Company at its expense will make and
deliver a new Warrant or stock certificate,  of like tenor, in lieu of the lost,
stolen, destroyed or mutilated Warrant or stock certificate.

         11.  Fractional  Shares.  No  fractional  shares  shall be issued  upon
exercise of this Warrant.  The Company shall,  in lieu of issuing any fractional
share,  pay the  Holder  entitled  to such  fraction a sum in cash equal to such
fraction  multiplied by the market price of the Common Stock, which shall be, on
any date,  the closing price for the Common Stock or the closing bid if no sales
were reported, as quoted on The Nasdaq Stock Market.



[Signature page follows]



<PAGE>

     IN WITNESS  WHEREOF,  the Company has caused this Warrant to be executed by
its officers, thereunto duly authorized this _____ day of ________ 1997.


QUALITY SEMICONDUCTOR, INC.


By:  _____________________________________
     Nme:    John Goldsberry
     Title:  Vice President - Finance and
             Chief Financial Officer

<PAGE>


FORM OF SUBSCRIPTION

(To be signed only upon exercise of Warrant)

To:  Quality Semiconductor, Inc.
851 Martin Avenue
Santa Clara, CA  95050-2903

         The undersigned,  the Holder of the within Warrant,  hereby irrevocably
elects to exercise the purchase  right  represented  by such Warrant for, and to
purchase thereunder, ____________________ (__________) shares of Common Stock of
Quality  Semiconductor,  Inc.  (the  "Company")  and herewith  makes  payment of
$__________  therefor  and  requests  that the  certificates  for such shares be
issued in the name of, and  delivered to  ______________________  at the address
set forth below.

         The  undersigned  represents,  unless the  exercise of this Warrant has
been  registered  under the Securities Act of 1933, as amended (the  "Securities
Act"),  that (i) the  undersigned  is  acquiring  such Common  Stock for his own
account for investment and not with a view to or for sale in connection with any
distribution thereof (except for any resale pursuant to a Registration Statement
under  the  Securities  Act),  (ii)  the  undersigned  has  such  knowledge  and
experience in financial and business  matters as to be capable of evaluating the
merits and risks of the undersigned's  investment in the shares of Common Stock,
(iii) the  undersigned  has  received  all of the  information  the  undersigned
requested  from  the  Company  and  the  undersigned   considers   necessary  or
appropriate  for deciding  whether to purchase the shares,  (iv) the undersigned
has the ability to bear the economic risks of his  prospective  investment,  and
(v)  the  undersigned  is  able,  without  materially  impairing  his  financial
condition,  to hold the shares of Common Stock for an indefinite  period of time
and to suffer complete loss on his investment. The undersigned is an "accredited
investor" as defined in Regulation D of the Securities Act on the date hereof.

DATED: ____________________



                                     __________________________________________
                                     (Signature must conform in all respects to
                                     name of Holder as specified on the face of
                                     the Warrant)

                                     __________________________________________
                                     __________________________________________
                                                      (Address)


<PAGE>

                                    EXHIBIT B

                           WIRE TRANSFER INSTRUCTIONS


The following wire transfer instructions should be used:

SILICON VALLEY BANK
San Jose, CA
ABA(routing & transit) # 121140399
Account # 3300035861
Account Name: California State Bar Account, Venture Law Group
By Order of: "Name of Sender"
Make reference to:  Quality Semiconductor, Inc.

<PAGE>



                                                                      EXHIBIT 99

                                        For more information contact:

                                        John P. Goldsberry
                                        Chief Financial Officer
                                        Quality Semiconductor, Inc.
                                        (408) 450-8000

                                        Morgen-Walke Associates, Inc.
                                        Suzanne Craig, Jim Byers, Laura Guerrant
                                        (212) 850-5600
 

FOR IMMEDIATE RELEASE

          QUALITY SEMICONDUCTOR ANNOUNCES $9.2 MILLION PRIVE PLACEMENT
                          OF COMMON STOCK AND WARRANTS

SANTA CLARA,  CA - (May 22, 1997) - Quality  Semiconductor,  Inc.  (Nasdaq:QUAL)
today announced that it had arranged a private  placement of 108,000 units, each
consisting  of 10 shares of common  stock and a one-year  warrant to purchase an
additional  share of common stock. The units were priced at $85.00 per unit, for
a total of $9.2 million. The transaction is anticipated to close on or about May
28, 1997.
         Proceeds from the private  placement will be used for general corporate
purposes and to fund the growth of its  business.  The company will exercise its
best  efforts  to file  within  30 days a  registration  statement  on Form  S-3
covering  the shares of common  stock and  warrant  shares  associated  with the
private  placement.  Needham &  Company,  Inc.  acted as agent  for the  private
placement.
         "We are pleased to have arranged this equity  private  placement  which
will allow us to continue to expand the scope of our operations," commented Paul
Gupta, President and Chief Executive Officer of Quality Semiconductor.
         Except  for  historical   information  contained  herein,  the  matters
discussed in this press release are forward-looking  statements that are subject
to certain risks and uncertainties that could cause the actual results to differ
materially from those projected, including, among others, litigation, the impact
of competitive products and pricing,  general economic conditions and conditions
specific to the  semiconductor  industry,  fluctuations in customer demand,  the
timing  and  market  acceptance  of  new  product   introductions,   the  timely
development  of new products and other risk factors  listed in the Company's SEC
reports including the Company's  periodic reports filed pursuant to the Security
Exchange  Act of 1934 and the  Registration  Statement  on form S-1 filed by the
Company in connection with its initial public  offering.  Quality  Semiconductor
assumes no obligation to update the information included in this press release.

                                   -continued-


<PAGE>



         Quality   Semiconductor,    Inc.   Designs,    develops   and   markets
high-performance  logic  as well as  networking  and  logic-intensive  specialty
memory  semiconductor   products.  The  Company  targets  systems  manufacturers
principally in the networking,  personal computer and workstation  markets.  The
Company's  logic  products  include the 3.3-volt  and 5-volt  QSFCT  families of
high-speed,  low noise interface logic devices,  the QuickSwitch  family of high
speed,  low  resistance  bus  switches,  a family of low-skew  clock  management
products,  a family of analog switch  devices and new JTAG products  designed to
allow  board-level   testing  of  complex  products.   Quality   Semiconductor's
networking  products  include two Fast Ethernet CMOS  transceivers  that provide
high  integration  solutions  for the  adapter,  repeater,  switch  and card bus
markets.
                                       ###
[{"type": "8-K", "sequence": "1", "description": "FORM 8-K", "secsgml_size_bytes": 83874}]
{"company-data": {"conformed-name": "QUALITY SEMICONDUCTOR INC", "cik": "0000869886", "assigned-sic": "3674", "irs-number": "770199189", "state-of-incorporation": "CA", "fiscal-year-end": "0930"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-23128", "film-number": "97623288"}, "business-address": {"street1": "851 MARTIN AVE", "city": "SANTA CLARA", "state": "CA", "zip": "95050", "phone": "4087278885"}, "mail-address": {"street1": "851 MARTIN AVE", "city": "SANTA CLARA", "state": "CA", "zip": "95050"}}
UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                    FORM 8-K

                Current Report Pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934

                          Date of Report June 11, 1997

                           QUALITY SEMICONDUCTOR, INC.
             (Exact name of registrant as specified in its charter)

      California                       2-23128                    77-0199189
(State or other jurisdiction         (Commission                (IRS Employer
of incorporation)                    File Number)            Identification No.)

                                851 Martin Avenue
                              Santa Clara, CA 95050
          (Address of principal executive offices) (including Zip code)

                                 (408) 450-8000
              (Registrant's telephone number, including area code)

                             Exhibit Index on page 4
Item 5.  Other Events

         On May 22, 1997, Quality Semiconductor,  Inc., a California corporation
(the "Company") announced that it had arranged a private placement (the "Private
Placement")  of  108,000  units,  each  consisting  of ten  (10)  shares  of the
Company's  Common Stock and a one-year  warrant to purchase  one (1)  additional
share of the Company's  Common  Stock.  The units were priced at $85.00 per unit
for a total of $9.2 million in cash.  The closing of the Private  Placement took
place on May 28, 1997. Needham & Company, Inc. received a placement fee of equal
to $60,000 for services rendered in connection with the Private  Placement.  The
investors  included funds  affiliated with Galleon Group,  Zesiger Capital Group
LLC,  CG Funds and Weiss Peck & Greer  LLC.  The  Company  relied on Rule 506 of
Regulation D under the  Securities  Act of 1933, as amended (the "Act"),  which,
among other things, provides an exemption from the registration  requirements of
the Act for  sales  to  accredited  investors  (as  defined  by Rule  501(a)  of
Regulation  D under the Act).  Under the  terms of the  Private  Placement,  the
Company has agreed to file a  Registration  Statement on Form S-3 within  thirty
days of the  closing of the  transaction,  to cover the shares of the  Company's
Common Stock that were  delivered  to the  investors at the closing and that are
issuable  upon  exercise of the  warrants.  The specific  terms of the Units are
contained  in the  instruments  defining  the rights of the holders of the Units
attached as an exhibit  hereto and  incorporated  by reference  herein.  Further
details of this  transaction  are contained in the Company's press release dated
May 22,  1997,  attached  as an exhibit  hereto and  incorporated  by  reference
herein.

Item 7.  Financial Statements, Pro Forma Financial Information and Exhibits.

         (c)      Exhibits.

Exhibit 4.1       Form of Unit Purchase Agreement (including Warrant),  dated
                  May 22, 1997 between  Quality  Semiconductor,  Inc. and the
                  Purchasers  (as defined therein).

Exhibit 99        Quality Semiconductor, Inc. Press Release dated May 22, 1997.
SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                           QUALITY SEMICONDUCTOR, INC.

Date:  June 11, 1997                       By: /s/  JOHN P. GOLDSBERRY
                                               -----------------------------
                                               John P. Goldsberry
                                               Vice President - Finance and
                                               Chief Financial Officer
                                               (Duly Authorized and Principal
                                               Financial and Accounting Officer)
QUALITY SEMICONDUCTOR, INC.

                                INDEX TO EXHIBITS

                                                                     Sequential
Exhibit Number     Description                                       Page Number

Exhibit 4.1        Form  of  Unit  Purchase   Agreement   (including      5
                   Warrant),   dated  May 22, 1997  between  Quality
                   Semiconductor,   Inc.  and  the   Purchasers  (as
                   defined therein).

Exhibit 99         Press Release dated May 22, 1997                       31
EXHIBIT 4.1
                             UNIT PURCHASE AGREEMENT

Quality Semiconductor, Inc.
851 Martin Avenue
Santa Clara, CA  95050-2903

Ladies & Gentleman:

         The undersigned, ____________________(the "Purchaser"), hereby confirms
its agreement with you as follows:

         1. This Unit Purchase Agreement (the "Agreement") is made as of May 16,
1997  between  Quality  Semiconductor,   Inc.,  a  California  corporation  (the
"Company"), and the Purchaser.

         2. The Company has  authorized  the sale and  issuance of up to 108,000
units (the "Units"), each consisting of ten (10) shares (the "Shares") of Common
Stock of the Company and one warrant (the  "Warrants") to purchase one (1) share
of Common Stock of the Company.

         3. The Company and the Purchaser agree that the Purchaser will purchase
and the  Company  will  sell,  for a purchase  price of $85.00  per Unit,  or an
aggregate       purchase       price       of        $_________________________,
_____________________Units  pursuant to the Terms and Conditions for Purchase of
Units  attached  hereto as Annex I and  incorporated  herein by  reference as if
fully  set  forth  herein.   Unless   otherwise   requested  by  the  Purchaser,
certificates  representing  the Shares and Warrants  purchased by the  Purchaser
will be registered in the Purchaser's name and address as set forth below.

     4. The Purchaser represents that, except as set forth below, (a) it has had
no position,  office or other material  relationship within the past three years
with the Company or its  affiliates and (b) neither it nor any group of which it
is a  member  beneficially  owns  any  securities  of the  Company.  Exceptions:
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(If no  exceptions,  write "none." If left blank,  response will be deemed to be
"none").

         Please  confirm that the foregoing  correctly  sets forth the agreement
between us by signing in the space provided below for that purpose.

                                 PURCHASER

                                 By: ____________________________________
                                 Title: _________________________________
                                 Address: _______________________________

                                 Tax ID No.: ____________________________

AGREED AND ACCEPTED:

___________________________
Quality Semiconductor, Inc.

By: _______________________
Title: ____________________
ANNEX I

                   TERMS AND CONDITIONS FOR PURCHASE OF UNITS

         1.       Authorization and Sale of Units

                  1.1  Authorization.  The Company has  authorized  the sale and
issuance  of up to 108,000  units (the  "Units"),  each  consisting  of ten (10)
shares of Common Stock of the Company (the "Shares") and one warrant to purchase
one (1) share of Common Stock of the Company (the  "Warrants"),  pursuant to the
Agreement.  The shares of Common Stock of the Company to be issued upon exercise
of the Warrants are hereinafter referred to as the "Warrant Shares."

                  1.2 Sale of Units.  Subject to the terms and conditions of the
Agreement,  the  Company  agrees  to issue and sell to each  Purchaser  and each
Purchaser  severally agrees to purchase from the Company the number of Units set
forth in the Agreement.

         2.       Closing Date; Delivery

                  2.1 Closing Date.  The closing of the purchase and sale of the
Units  hereunder  (the  "Closing")  shall be held at the  offices of Venture Law
Group,  P.C., 2800 Sand Hill Road,  Menlo Park,  California at 3:00 p.m., on May
28,  1997 or at such  other  time and place as the  Company  and the  Purchasers
purchasing  a majority  of the Units  shall  agree.  The date of the  Closing is
hereinafter referred to as the "Closing Date."

                  2.2 Delivery. At the Closing, the Company will deliver to each
Purchaser (a) a certificate,  registered in the Purchaser's  name and address as
shown in the Agreement, representing the number of Shares to be purchased by the
Purchaser  and (b) a Warrant  certificate,  substantially  in the form  attached
hereto as Exhibit A, representing the number of Warrants to be purchased by such
Purchaser.  Such delivery shall be against payment  therefor by wire transfer of
the  aggregate  purchase  price of the Units set  forth in the  Agreement  to an
escrow account  established  at Silicon Valley Bank by Venture Law Group,  P.C.,
escrow  agent for the Company  (the  "Escrow  Agent"),  in  accordance  with the
instructions set forth in Exhibit B hereto.  All payments received by the Escrow
Agent prior to the Closing Date shall be held in a trust account for the benefit
of the Purchasers pending Closing of the offering.

         3.       Representations and Warranties of the Company

                  The Company  represents  and warrants to the  Purchasers as of
the Closing Date as follows:

                  3.1 Organization,  Standing; Qualification to Do Business. The
Company is a corporation  duly  organized  and validly  existing  under,  and by
virtue  of, the laws of the State of  California  and is in good  standing  as a
domestic corporation under the laws of said state. The Company is duly qualified
to do  business  as a  foreign  corporation  and is in  good  standing  in  each
jurisdiction  in which the ownership or leasing of its properties or the conduct
of its business requires such  qualification,  except where the failure to be so
qualified  or be in good  standing is not  reasonably  likely to have a material
adverse effect on the Company and its subsidiaries considered as one enterprise.

                  3.2  Corporate  Power;  Authorization.  The  Company  has  all
requisite legal and corporate power and has taken all requisite corporate action
to execute and deliver the  Agreement,  to sell and issue the Units and to carry
out and  perform  all of its  obligations  under the  Agreement.  The  Agreement
constitutes the legal, valid and binding obligation of the Company,  enforceable
in  accordance  with its  terms,  except  (a) as rights to  indemnification  and
contribution hereunder may be limited by applicable law, equitable principles or
public   policy,   (b)  as  limited  by   applicable   bankruptcy,   insolvency,
reorganization  or similar laws  relating to or  affecting  the  enforcement  of
creditors'  rights  generally  and  (c)  as  limited  by  equitable   principles
generally.  The  execution  and  delivery  of the  Agreement  does not,  and the
performance of the Agreement and the compliance  with the provisions  hereof and
the issuance,  sale and delivery of the Units by the Company will not materially
conflict  with,  or  result in a  material  breach or  violation  of the  terms,
conditions or provisions of, or constitute a material  default under,  or result
in the creation or imposition of any material lien pursuant to the terms of, the
Amended and Restated  Articles of  Incorporation or Bylaws of the Company or any
statute,  law,  rule or regulation  or any state or federal  order,  judgment or
decree  or any  indenture,  mortgage,  lease  or  other  material  agreement  or
instrument to which the Company or any of its properties is subject.

                  3.3 Issuance and Delivery of the Shares,  Warrants and Warrant
Shares.  The  Shares  and the  Warrants,  when  issued  in  compliance  with the
provisions of the Agreement,  and the Warrant Shares,  when issued in compliance
with the  Agreement  and the Warrants,  will be validly  issued,  fully paid and
nonassessable.  The issuance  and  delivery of the Shares,  the Warrants and the
Warrant  Shares are not subject to preemptive or any other similar rights of the
shareholders of the Company or any liens or encumbrances.

                  3.4 Private  Placement  Offering  Memorandum;  SEC  Documents;
Financial  Statements.  Each  complete  or  partial  statement,  report or proxy
statement  included as an exhibit to the Company's  Private  Placement  Offering
Memorandum dated May 14, 1997 as amended on May 16,1997 (such Private  Placement
Offering Memorandum,  including all exhibits thereto, being hereinafter referred
to as the  "Memorandum")  is a true and complete  copy of or a true excerpt from
such  document  as  filed  by the  Company  with  the  Securities  and  Exchange
Commission  (the "SEC").  The Company has filed in a timely manner all documents
that the Company was required to file with the SEC under  Sections 13, 14(a) and
15(d) of the Securities  Exchange Act of 1934, as amended (the "Exchange  Act"),
during the 12 months preceding the date of the Agreement. As of their respective
filing  dates,  all  documents  filed by the  Company  with  the SEC  (the  "SEC
Documents")  complied in all  material  respects  with the  requirements  of the
Exchange Act or the Securities Act of 1933, as amended (the  "Securities  Act"),
as  applicable.  Neither  the  Agreement,  the  Memorandum  nor  any of the  SEC
Documents  as of their  respective  dates  included  an  untrue  statement  of a
material fact or omitted to state a material fact necessary in order to make the
statements  therein,  in the light of the  circumstances  under  which they were
made, not misleading.  The financial  statements of the Company  included in the
SEC Documents or the Memorandum (the "Financial  Statements")  comply as to form
in all material  respects with applicable  accounting  requirements and with the
published rules and regulations of the SEC with respect  thereto.  The Financial
Statements have been prepared in accordance with generally  accepted  accounting
principles  consistently  applied and fairly present the consolidated  financial
position  of the  Company  and any  subsidiaries  at the dates  thereof  and the
consolidated  results of their  operations and  consolidated  cash flows for the
periods then ended  (subject,  in the case of unaudited  statements,  to normal,
recurring adjustments).

                  3.5  Governmental  Consents.  No consent,  approval,  order or
authorization of, or registration,  qualification,  designation,  declaration or
filing with, any federal,  state or local governmental  authority on the part of
the Company is required in connection with the  consummation of the transactions
contemplated by the Agreement, except for (a) compliance with the securities and
blue sky laws in the  states  in which  Units are  offered  and/or  sold,  which
compliance  will be effected in accordance  with such laws,  (b) the filing of a
registration  statement and any amendments  thereto with the SEC as contemplated
by Section 7.2 of the  Agreement and (c) the filing of a  Notification  Form For
the Listing of  Additional  Shares with The Nasdaq  Stock Market and a Form 10-C
with the SEC.

                  3.6 No Material Adverse Change.  Except as otherwise disclosed
herein,  since March 31, 1997, there has not been (a) any changes in the assets,
liabilities,  financial  condition,  business  prospects  or  operations  of the
Company from that  reflected in the Financial  Statements  except changes in the
ordinary course of business which,  individually and in the aggregate,  have not
had a material adverse effect on the Company and its subsidiaries  considered as
one enterprise;  (b) any material change or amendment to a material  contract or
arrangement  by which the Company or any of its assets or properties is bound or
subject;  (c) any resignation or termination of employment,  or to the Company's
knowledge,  any impending  resignation  or  termination  of  employment,  of any
executive officer or key employee of the Company;  (d) notice of any loss of, or
the cancellation or any material order by, any material customer of the Company;
or (e) any  declaration  or payment of any  dividend  or other  distribution  of
assets of the Company.

                  3.7  Intellectual  Property.  Each  of  the  Company  and  its
subsidiaries  owns or possesses  sufficient  rights to use all material patents,
patent rights, trademarks,  copyrights,  licenses, inventions, trade secrets and
know-how  described or referred to in the  Memorandum  as owned or used by it or
that are  necessary  for the  conduct of its  business as now  conducted  and as
proposed to be conducted as described in the Memorandum; neither the Company nor
any of its subsidiaries has received any notice of, or has any knowledge of, any
infringement  of or conflict with asserted  rights of others with respect to any
patent, patent right, trademark,  copyright, invention, trade secret or know-how
that,  individually  or in the  aggregate,  if  the  subject  of an  unfavorable
decision,  ruling  or  finding,  would  have a  material  adverse  effect on the
condition (financial or otherwise),  earnings, operations,  business or business
prospects of the Company and its subsidiaries considered as one enterprise.

                  3.8 Authorized Capital Stock;  Options. The authorized capital
stock of the Company consists of (a) 25,500,000 shares of Common Stock, of which
6,048,845  shares were outstanding as of April 30, 1997 and (b) 1,000,000 shares
of Preferred  Stock,  none of which is  outstanding.  As of April 30, 1997,  the
Company had authorized  options to purchase an aggregate of 2,391,666  shares of
Common  Stock of the  Company  (the  "Options"),  of which  Options to  purchase
1,590,114  shares of Common Stock were  outstanding as of such date.  Except for
(i) the Options, (ii) 50,000 warrants,  each to purchase one share of the Common
Stock of the  Company,  issued in  connection  with the  acquisition  of certain
assets from AWA  Microelectronics  Pty.  Ltd., a subsidiary  of AWA Limited,  on
February  16,  1996,  and  (iii) as set  forth in the  Memorandum,  there are no
outstanding  options to purchase,  or any  preemptive  rights or other rights to
subscribe for or to purchase, any securities of the Company.

                  3.9 Litigation.  Except as set forth in the Memorandum,  there
are no actions, suits,  proceedings or investigations pending or, to the best of
the Company's knowledge, threatened against the Company or any of its properties
before  or by any  court or  arbitrator  or any  governmental  body,  agency  or
official  that (a) might have a material  adverse  effect on the Company and its
subsidiaries considered as one enterprise or (b) might impair the ability of the
Company to perform in any material respect its obligations under the Agreement.

                  3.10 Use of  Proceeds.  The  Company  intends to apply the net
proceeds  from the sales of the shares in the manner set forth under the caption
"Use of Proceeds" in the Memorandum.

                  3.11   Private   Placement.   Assuming  the  accuracy  of  the
representations  and  warranties  of  the  Purchasers,  and  compliance  by  the
Purchasers of all of their covenants and agreements  contained in the Agreement,
the offer,  sale and issuance by the Company of the Units to the  Purchasers  as
contemplated  in  the  Agreement   constitute   transactions   exempt  from  the
registration requirements of Section 5 of the Securities Act.

         4.       Representations, Warranties and Covenants of the Purchasers

                  Each Purchaser hereby severally  represents and warrants,  and
covenants and agrees with, to the Company, as of the Closing Date, as follows:

                  4.1  Authorization.  Purchaser  has all  requisite  legal  and
corporate or other power and capacity and has taken all  requisite  corporate or
other action to execute and deliver the  Agreement,  to purchase the Units to be
purchased  by it and to carry out and perform all of its  obligations  under the
Agreement.  The Agreement constitutes the legal, valid and binding obligation of
the Purchaser, enforceable in accordance with its terms, except (a) as rights to
indemnification  and  contribution  hereunder may be limited by applicable  law,
equitable principles or public policy, (b) as limited by applicable  bankruptcy,
insolvency,  reorganization  or  similar  laws  relating  to  or  affecting  the
enforcement  of  creditors'  rights  generally  and (c) as limited by  equitable
principles generally.

                  4.2  Investment   Experience.   Purchaser  is  an  "accredited
investor" as defined in Rule 501(a) under the Securities Act. Purchaser is aware
of the Company's business affairs and financial  condition and has had access to
and has acquired  sufficient  information about the Company to reach an informed
and knowledgeable decision to acquire the Units. Purchaser has such business and
financial  experience  as is required to give it the capacity to protect its own
interests  in  connection  with the  purchase of the Units.  Purchaser  is not a
"broker" or a "dealer" as defined in the Exchange Act and is not an  "affiliate"
of the Company as defined in the Securities Act.
4.3 Investment  Intent.  Purchaser is purchasing the Units for
its own account as  principal,  for  investment  purposes  only,  and not with a
present view to, or for, resale,  distribution or fractionalization  thereof, in
whole  or  in  part,  within  the  meaning  of  the  Securities  Act.  Purchaser
understands  that its acquisition of the Units has not been registered under the
Securities  Act or registered  or qualified  under any state  securities  law in
reliance on specific  exemptions  therefrom,  which  exemptions may depend upon,
among other things,  the bona fide nature of  Purchaser's  investment  intent as
expressed herein. Purchaser has, in connection with its decision to purchase the
number of Units set forth in the  Agreement,  relied solely upon the  Memorandum
and  the  representations  and  warranties  of  the  Company  contained  herein.
Purchaser will not, directly or indirectly,  offer,  sell,  pledge,  transfer or
otherwise  dispose of (or  solicit  any  offers to buy,  purchase  or  otherwise
acquire  or take a pledge of) any of the  Shares,  Warrants  or  Warrant  Shares
except in  compliance  with the  Securities  Act and the  rules and  regulations
promulgated thereunder.

                  4.4 Registration or Exemption Requirements.  Purchaser further
acknowledges  and  understands  that the Shares,  the  Warrants  and the Warrant
Shares  may not be  resold or  otherwise  transferred  except  in a  transaction
registered   under  the   Securities  Act  or  unless  an  exemption  from  such
registration  is  available.   Purchaser   understands   that  the  certificates
evidencing  the  Shares  and  the  Warrant  Shares,  and the  Warrants,  will be
imprinted with a legend that prohibits the transfer of the Shares,  the Warrants
or the  Warrant  Shares  unless  (a)  such  transaction  is  registered  or such
registration  is not  required,  and  (b)  if the  transfer  is  pursuant  to an
exemption from registration other than Rule 144 under the Securities Act, and if
the Company shall so request in writing,  an opinion reasonably  satisfactory to
the Company of counsel reasonably satisfactory to the Company is obtained to the
effect that the transaction is so exempt.

                  4.5   Restriction   on  Sales,   Short   Sales   and   Hedging
Transactions. Purchaser will not, prior to the effectiveness of the Registration
Statement, sell, offer to sell, solicit offers to buy, dispose of, loan, pledge,
or grant any right with respect to (collectively,  a "Disposition"),  the Common
Stock  of the  Company,  nor  will  Purchaser  engage  in any  hedging  or other
transaction  which is designed to or could  reasonably be expected to lead to or
result in a  Disposition  of Common Stock of the Company by the Purchaser or any
other person or entity.  Such  prohibited  hedging or other  transactions  would
include  without  limitation  effecting  any short  sale or having in effect any
short  position  (whether  or not such sale or  position  is against the box and
regardless  of when such  position was entered  into) or any  purchase,  sale or
grant of any right  (including  without  limitation any put or call option) with
respect  to the Common  Stock of the  Company  or with  respect to any  security
(other than a broad-based  market basket or index) that includes,  relates to or
derives any significant part of its value from the Common Stock of the Company.

                  4.6 No Legal, Tax or Investment Advice.  Purchaser understands
that nothing in the Memorandum,  the Agreement or any other materials  presented
to Purchaser in connection  with the purchase and sale of the Units  constitutes
legal,  tax or investment  advice.  Purchaser has consulted such legal,  tax and
investment  advisors  as it, in its sole  discretion,  has deemed  necessary  or
appropriate in connection with its purchase of the Units.
5.       Conditions to Closing of Purchasers

                  Each  Purchaser's  obligation  to  purchase  the  Units at the
Closing  is, at the  option of such  Purchaser,  subject to the  fulfillment  or
waiver as of the Closing Date of the following conditions:

                  5.1  Representations  and Warranties.  The representations and
warranties  made by the Company in Section 3 hereof shall be true and correct in
all  material  respects  when made and shall be true and correct in all material
respects on the Closing  Date with the same force and effect as if they had been
made on and as of the Closing Date.

                  5.2  Covenants.  All  covenants,   agreements  and  conditions
contained  in the  Agreement  to be  performed by the Company on or prior to the
Closing Date shall have been performed or complied with in all respects.

     5.3 Blue Sky. The Company shall have  obtained all  necessary  blue sky law
permits and  qualifications,  or secured exemptions  therefrom,  required by any
state or foreign or other jurisdiction for the offer and sale of the Units.

         6.       Conditions to Closing of Company

                  The  Company's  obligation  to sell and issue the Units at the
Closing is, at the option of the Company,  subject to the  fulfillment or waiver
of the following conditions:

                  6.1  Representations  and Warranties.  The representations and
warranties  made by each Purchaser in Section 4 hereof shall be true and correct
in all material respects when made and shall be true and correct in all material
respects on the Closing  Date with the same force and effect as if they had been
made on and as of the Closing Date.

                  6.2  Covenants.  All  covenants,   agreements  and  conditions
contained in the Agreement to be performed by the  Purchasers on or prior to the
Closing  Date  shall  have  been  performed  or  complied  with in all  material
respects.

     6.3 Blue Sky. The Company shall have  obtained all  necessary  blue sky law
permits and  qualifications,  or secured exemptions  therefrom,  required by any
state or foreign or other jurisdiction for the offer and sale of the Units.

         7.       Affirmative Covenants

                  The Company and the Purchasers  hereby  respectively  covenant
and agree as follows:

                  7.1 Financial Information. The Company will mail the following
reports to each Purchaser until such Purchaser  transfers,  assigns or sells the
Shares, the Warrants and the Warrant Shares purchased by such Purchaser pursuant
to the Agreement:
(a) Within 100 days after the end of each fiscal year, a copy of its Annual
Report on Form 10-K.

     (b) Within 55 days after the end of the first,  second and third  quarterly
accounting  periods of each fiscal year of the Company,  a copy of its Quarterly
Report on Form 10-Q.

     (c) Within ten days after the Company files any Current  Report on Form 8-K
with the SEC, such Current Report on Form 8-K.

                  7.2      Registration Requirements.

     (a) Not later than the date which is 30 days  following  the Closing  Date,
the Company shall prepare and file a registration  statement (the  "Registration
Statement")  with the SEC under the Securities Act to register the resale of the
Shares and the Warrant Shares (collectively,  the "Registerable Securities") and
shall use its best  efforts to secure  the  effectiveness  of such  registration
statement as soon as reasonably practicable thereafter.

     (b) The Company shall pay all  Registration  Expenses (as defined below) in
connection with any  registration,  qualification or compliance  hereunder,  and
each  Purchaser  shall pay all Selling  Expenses  (as  defined  below) and other
expenses  that  are  not  Registration  Expenses  relating  to the  Registerable
Securities  resold by such  Purchaser.  "Registration  Expenses"  shall mean all
expenses, except for Selling Expenses, incurred by the Company in complying with
the registration provisions herein described, including, without limitation, all
registration,  qualification and filing fees,  printing  expenses,  escrow fees,
fees and  disbursements  of counsel for the Company,  blue sky fees and expenses
and the  expense of any  special  audits  incident  to or  required  by any such
registration.   "Selling   Expenses"   shall  mean  all   selling   commissions,
underwriting  fees and  stock  transfer  taxes  applicable  to the  Registerable
Securities and all fees and disbursements of counsel for any Purchaser.

     (c) In the case of the  registration  effected by the  Company  pursuant to
these  registration  provisions,  the Company  will use its best efforts to: (i)
keep such registration effective until the earlier of (A) the second anniversary
of the date hereof,  (B) such date as all of the  Registerable  Securities  have
been resold or (C) such time as all of the  Registerable  Securities held by the
Purchasers can be sold within a given three-month period without compliance with
the  registration  requirements  of the  Securities  Act  pursuant  to Rule  144
promulgated  thereunder  ("Rule  144");  (ii) prepare and file with the SEC such
amendments and supplements to the Registration Statement and the prospectus used
in connection with the Registration Statement as may be necessary to comply with
the  provisions of the  Securities  Act with respect to the  disposition  of all
securities covered by the Registration  Statement;  (iii) furnish such number of
prospectuses and other documents incident thereto, including any amendment of or
supplement to the  prospectus,  as a Purchaser  from time to time may reasonably
request;  (iv)  cause the  Shares  and the  Warrant  Shares to be listed on each
securities  exchange  and  quoted on each  quotation  service  on which  similar
securities  issued by the  Company  are then  listed or  quoted;  (v)  provide a
transfer  agent and  registrar  for all  securities  registered  pursuant to the
Registration  Statement  and a  CUSIP  number  for  all  such  securities;  (vi)
otherwise  use its  best  efforts  to  comply  with  all  applicable  rules  and
regulations of the SEC; and (vii) file the documents required of the Company and
otherwise use its best efforts to maintain  requisite  blue sky clearance in (X)
all  jurisdictions  in which any of the Units  are  originally  sold and (Y) all
other states specified in writing by a Purchaser, provided, however, that, as to
clause  (Y),  the  Company  shall not be  required  to qualify to do business or
consent to  service of process in any state in which it is not now so  qualified
or has not so consented.

     (d) The Company shall furnish to each  Purchaser  upon request a reasonable
number of copies of a supplement  to or an amendment of the  prospectus  used in
connection  with the  Registration  Statement  as may be  necessary  in order to
facilitate  the  public  sale  or  other  disposition  of  all  or  any  of  the
Registerable Securities held by the Purchaser.

     (e) With a view to making  available to the Purchasers the benefits of Rule
144 and any other rule or  regulation  of the SEC that may at any time  permit a
Purchaser to sell Registerable  Securities to the public without registration or
pursuant to a  registration  statement  on Form S-3, the Company  covenants  and
agrees  to use its  best  efforts  to:  (i) make  and  keep  public  information
available,  as those terms are  understood  and  defined in Rule 144,  until the
earlier of (A) the second anniversary of the date hereof or (B) such date as all
of the Registerable Securities shall have been resold; (ii) file with the SEC in
a timely  manner all reports and other  documents  required of the Company under
the  Securities  Act and Exchange Act; and (iii)  furnish to any Purchaser  upon
request,  as long as the  Purchaser  owns  any  Registerable  Securities,  (A) a
written  statement  by the  Company  that it has  complied  with  the  reporting
requirements  of the Securities Act and the Exchange Act, (B) a copy of the most
recent annual or quarterly report of the Company, and (C) such other information
as may be  reasonably  requested in order to avail any  Purchaser of any rule or
regulation  of the  SEC  that  permits  the  selling  of any  such  Registerable
Securities  without  registration or pursuant to such registration  statement on
Form S-3.

     (f) If any  Purchaser  shall  propose to sell any  Registerable  Securities
pursuant  to the  Registration  Statement,  it shall  notify the  Company of its
intent to do so at least two (2) full  business  days prior to such  sale.  Such
notice  shall  be  deemed  to  constitute  a  representation  that  any  written
information  previously supplied by such Purchaser (including without limitation
the information referred to in Section 8.4 hereof) is accurate as of the date of
such notice.  At any time within such two (2) business-day  period,  the Company
may  refuse to  permit  the  Purchaser  to resell  any  Registerable  Securities
pursuant  to the  Registration  Statement  for an  initial  period not to exceed
fifteen (15) days; provided,  however, that in order to exercise this right, the
Company must  deliver a  certificate  in writing to the  Purchaser to the effect
that a  delay  in  such  sale  is  necessary  because  a sale  pursuant  to such
Registration  Statement  in its  then-current  form  would  not  be in the  best
interests of the Company and its shareholders  due to disclosure  obligations of
the Company.  In such an event,  the Company shall use its best efforts to amend
the Registration  Statement if necessary and to take all other actions necessary
to allow  such  sale,  and shall  notify  the  Purchaser  promptly  after it has
determined that such sale has become permissible. Notwithstanding the foregoing,
the  Company  shall  not be  entitled  to  exercise  its right to  withdraw  the
registration  statement  more than three (3) times in any  calendar  year or for
more than two  consecutive  fifteen (15) day periods in any calendar year.  Each
Purchaser  hereby  covenants  and agrees that it will not sell any  Registerable
Securities  pursuant  to the  Registration  Statement  during  the  periods  the
Registration Statement is withdrawn as set forth in this Section 7.2(f).

                  7.3      Indemnification and Contribution.

     (a) The Company  agrees to indemnify and hold harmless each  Purchaser from
and  against  any  losses,   claims,  damages  or  liabilities  (or  actions  or
proceedings  in respect  thereof)  to which such  Purchaser  may become  subject
(under the Securities Act or otherwise) insofar as such losses,  claims, damages
or liabilities  (or actions or proceedings in respect  thereof) arise out of, or
are based upon,  any untrue  statement of a material fact or omission to state a
material fact in the  Registration  Statement on the effective date thereof,  or
arise out of any failure by the Company to fulfill any  undertaking  included in
the Registration  Statement,  and the Company will, as incurred,  reimburse such
Purchaser for any legal or other expenses  reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; provided,
however,  that the  Company  shall not be liable in any such case to the  extent
that such loss,  claim,  damage or liability arises out of, or is based upon (i)
an untrue statement or omission in such Registration  Statement in reliance upon
and in  conformity  with written  information  furnished to the Company by or on
behalf of such Purchaser specifically for use in preparation of the Registration
Statement,  (ii) the failure of such  Purchaser to comply with the covenants and
agreements  contained in Sections 7.2(f),  8.3 or 8.4 hereof, or (iii) an untrue
statement or omission in any  prospectus  that is  corrected  in any  subsequent
prospectus,  or  supplement  or  amendment  thereto,  that was  delivered to the
Purchaser prior to the pertinent sale or sales by the Purchaser.

     (b) Each Purchaser, severally and not jointly, agrees to indemnify and hold
harmless the Company from and against any losses, claims, damages or liabilities
(or actions or proceedings  in respect  thereof) to which the Company may become
subject (under the Securities Act or otherwise) insofar as such losses,  claims,
damages or liabilities (or actions or proceedings in respect  thereof) arise out
of, or are based upon (i) an untrue  statement of a material fact or omission to
state a material  fact in the  Registration  Statement  in reliance  upon and in
conformity with written information  furnished to the Company by or on behalf of
such  Purchaser   specifically  for  use  in  preparation  of  the  Registration
Statement; provided, however, that no Purchaser shall be liable in any such case
for any untrue  statement or omission in any prospectus which statement has been
corrected, in writing, by such Purchaser and delivered to the Company before the
sale from which such loss occurred, (ii) the failure of such Purchaser to comply
with the  covenants  and  agreements  contained in Sections  7.2(f),  8.3 or 8.4
hereof,  or (iii) an untrue  statement  or  omission in any  prospectus  that is
corrected in any subsequent prospectus, or supplement or amendment thereto, that
was  delivered  to the  Purchaser  prior to the  pertinent  sale or sales by the
Purchaser,  and each  Purchaser,  severally and not jointly,  will, as incurred,
reimburse  the Company for any legal or other  expenses  reasonably  incurred in
investigating,  defending or preparing to defend any such action,  proceeding or
claim.

     (c) Promptly after receipt by any indemnified person of a notice of a claim
or the  beginning  of any action in respect of which  indemnity  is to be sought
against an indemnifying  person  pursuant to this Section 7.3, such  indemnified
person shall notify the  indemnifying  person in writing of such claim or of the
commencement of such action, and, subject to the provisions  hereinafter stated,
in case any such action shall be brought  against an indemnified  person and the
indemnifying  person shall have been notified thereof,  the indemnifying  person
shall be entitled to participate therein, and, to the extent that it shall wish,
to assume the defense  thereof,  with  counsel  reasonably  satisfactory  to the
indemnified   person.   After  notice  from  the  indemnifying  person  to  such
indemnified  person of the indemnifying  person's election to assume the defense
thereof,  the indemnifying person shall not be liable to such indemnified person
for any legal  expenses  subsequently  incurred  by such  indemnified  person in
connection with the defense thereof; provided,  however, that if there exists or
shall  exist a conflict  of  interest  that would make it  inappropriate  in the
reasonable  judgment of the indemnified person for the same counsel to represent
both the  indemnified  person and such  indemnifying  person or any affiliate or
associate  thereof,  the indemnified  person shall be entitled to retain its own
counsel at the expense of such indemnifying person.

     (d) If the indemnification  provided for in this Section 7.3 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses,  claims,  damages or liabilities (or actions
or proceedings in respect thereof)  referred to therein,  then each indemnifying
party shall contribute to the amount paid or payable by such  indemnified  party
as result of such losses,  claims, damages or liabilities (or actions in respect
thereof) in such  proportion as is  appropriate to reflect the relative fault of
the Company on the one hand and the  Purchasers on the other in connection  with
the statements or omissions  which resulted in such losses,  claims,  damages or
liabilities  (or  actions in  respect  thereof),  as well as any other  relevant
equitable  considerations.  The relative  fault shall be determined by reference
to,  among other  things,  whether the untrue or alleged  untrue  statement of a
material  fact or the  omission  or alleged  omission  to state a material  fact
relates to information supplied by the Company on the one hand or a Purchaser on
the other and the parties' relative intent, knowledge, access to information and
opportunity  to correct or prevent such  statement or omission.  The Company and
the  Purchasers  agree that it would not be just and  equitable if  contribution
pursuant to this subsection (d) were determined by pro rata allocation  (even if
the  Purchasers  were  treated as one entity for such  purpose)  or by any other
method  of   allocation   which  does  not  take  into  account  the   equitable
considerations  referred  to above in this  subsection  (d).  The amount paid or
payable by an indemnified  party as a result of the losses,  claims,  damages or
liabilities (or actions in respect thereof) referred to above in this subsection
(d) shall be deemed to include any legal or other expenses  reasonably  incurred
by such indemnified party in connection with investigating or defending any such
action or claim.  Notwithstanding  the  provisions  of this  subsection  (d), no
Purchaser  shall be required to contribute any amount in excess of the amount by
which the net amount  received by the  Purchaser  from the sale of the Shares or
Warrant  Shares,  as the case may be, to which  such loss  relates  exceeds  the
amount of any damages which such Purchaser has otherwise been required to pay by
reason of such  untrue or  alleged  untrue  statement  or  omission  or  alleged
omission. No person guilty of fraudulent  misrepresentation  (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to  contribution  from
any  person  who  was  not  guilty  of such  fraudulent  misrepresentation.  The
Purchasers'  obligations  in this  subsection  (d) to contribute  are several in
proportion to their  respective  sales of Shares or Warrant Shares,  as the case
may be, to which such loss relates and not joint.

     (e) The  obligations of the Company and the  Purchasers  under this Section
7.3 shall be in addition to any liability  which the Company and the  respective
Purchasers  may  otherwise  have and  shall  extend,  upon the  same  terms  and
conditions,  to each person,  if any, who controls the Company or any  Purchaser
within the meaning of the Securities Act and the Exchange Act.

     8. Restrictions on Transferability of Shares,  Warrants and Warrant Shares;
Compliance with Securities Act.

                  8.1 Restrictions on Transferability.  The Shares, the Warrants
and the Warrant Shares shall not be  transferable in the absence of registration
under  the  Securities  Act  or an  exemption  therefrom  or in the  absence  of
compliance with any term of the Agreement. The Company shall be entitled to give
stop transfer instructions to its transfer agent with respect to the Shares, the
Warrants and the Warrant Shares in order to enforce the foregoing restrictions.

     8.2 Restrictive  Legend.  Each  certificate  representing  the Shares,  the
Warrants and the Warrant Shares shall bear  substantially  the following legends
(in addition to any legends required under applicable state securities laws):

                  THE  SECURITIES  REPRESENTED  BY THIS  CERTIFICATE  HAVE  BEEN
                  ACQUIRED  FOR  INVESTMENT  PURPOSES  ONLY  AND  HAVE  NOT BEEN
                  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933. THE SECURITIES
                  MAY  NOT BE  SOLD  OR  TRANSFERRED  IN  THE  ABSENCE  OF  SUCH
                  REGISTRATION OR AN EXEMPTION THEREFROM.

                  ADDITIONALLY,  THE TRANSFER OF THE  SECURITIES  REPRESENTED BY
                  THIS CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS  SPECIFIED
                  IN A UNIT  PURCHASE  AGREEMENT  DATED MAY 16, 1997 BETWEEN THE
                  COMPANY  AND  THE  ORIGINAL  PURCHASER,  AND  NO  TRANSFER  OF
                  SECURITIES SHALL BE VALID OR EFFECTIVE ABSENT  COMPLIANCE WITH
                  SUCH RESTRICTIONS.  ALL SUBSEQUENT HOLDERS OF THIS CERTIFICATE
                  WILL HAVE  AGREED TO BE BOUND BY  CERTAIN  OF THE TERMS OF THE
                  AGREEMENT,   INCLUDING  SECTIONS  7.2,  8.3  AND  8.4  OF  THE
                  AGREEMENT.  A COPY OF THE AGREEMENT MAY BE OBTAINED AT NO COST
                  BY  WRITTEN  REQUEST  MADE BY THE  REGISTERED  HOLDER  OF THIS
                  CERTIFICATE TO THE SECRETARY OF THE COMPANY.

                  8.3  Transfer of Shares,  Warrants  and Warrant  Shares.  Each
Purchaser  hereby covenants with the Company not to make any sale of the Shares,
the Warrants or the Warrant Shares except either (a) a sale of Shares or Warrant
Shares  in  accordance  with  the  Registration  Statement,  in  which  case the
Purchaser  covenants  to comply with the  requirement  of  delivering  a current
prospectus,  (b) a sale of Shares, Warrants or Warrant Shares in accordance with
Rule 144, in which case the Purchaser  covenants to comply with Rule 144, or (c)
subject to such conditions as the Company in its sole  discretion  shall impose,
in accordance with another  exemption from the registration  requirements of the
Securities Act. Each Purchaser further acknowledges and agrees that such Shares,
Warrants  and Warrant  Shares are not  transferable  on the books of the Company
unless the certificate submitted to the Company's transfer agent evidencing such
Shares,   Warrants  or  Warrant  Shares  is   accompanied  by  such   additional
certification,   documentation  or  information  as  the  Company  in  its  sole
discretion  shall  require in order to effect such sale in  accordance  with the
Registration  Statement,  Rule 144 or such other exemption from the registration
requirements of the Securities  Act. No transfer of Shares,  Warrants or Warrant
Shares  will be  effected  to any  "affiliate"  of the Company as defined in the
Securities Act except  pursuant to subsection (a) or (b) hereof.  The legend set
forth in Section 8.2 will be removed  from a  certificate  representing  Shares,
Warrants or Warrant Shares  following and in connection with any sale of Shares,
Warrants or Warrant  Shares,  as the case may be,  pursuant to subsection (a) or
(b) hereof but not in  connection  with any sale of Shares,  Warrants or Warrant
Shares, as the case may be, pursuant to subsection (c) or (d) hereof.

     8.4 Purchaser  Information.  Each Purchaser covenants that it will promptly
notify  the  Company  of  any  changes  in  the  information  set  forth  in the
Registration  Statement  regarding such Purchaser or such  Purchaser's  "Plan of
Distribution."

         9.       Miscellaneous

                  9.1 Waivers and  Amendments.  With the exception of Sections 7
and 8 hereof,  the terms of the  Agreement  may be  waived or  amended  with the
written  consent of the Company and each  Purchaser.  With respect to Sections 7
and 8 hereof,  with the written consent of the Company and the record holders of
more than 50% of the Shares then outstanding and held by Purchasers  (including,
for  purposes  of such  calculation,  outstanding  Warrant  Shares and shares of
Common Stock issuable upon exercise of outstanding  Warrants),  the terms of the
Agreement  may be waived or amended and any such  amendment  or waiver  shall be
binding upon the Company and all holders of Shares, Warrants or Warrant Shares.

                  9.2 Broker's Fee. Each Purchaser acknowledges that the Company
intends to pay a fee to Needham & Company, Inc.  ("Needham"),  in respect of the
sale  of the  Units  to  the  Purchasers.  Each  of the  parties  hereto  hereby
represents  that,  on the basis of any actions and  agreements by it, and except
for certain  finders to be paid a fee out of Needham's  fee,  there are no other
brokers or finders  entitled to  compensation in connection with the sale of the
Units to the Purchasers.

     9.3 Governing  Law. The Agreement  shall be governed in all respects by and
construed in accordance with the laws of the State of California  without regard
to conflicts of laws principles.

                  9.4 Survival. The representations,  warranties,  covenants and
agreements  made in the Agreement  shall survive any  investigation  made by the
Company or the Purchasers and shall survive the Closing.

                  9.5 Successors and Assigns.  The provisions hereof shall inure
to the  benefit  of,  and be  binding  upon,  the  successors,  assigns,  heirs,
executors and  administrators  of the parties to the Agreement.  Notwithstanding
the foregoing, no Purchaser shall assign the Agreement without the prior written
consent of the Company.  The  provisions  of Sections 7, 8 and 9 hereof shall be
binding  on and shall  inure to the  benefit  of  subsequent  holders of Shares,
Warrants or Warrant Shares, other than subsequent holders purchasing pursuant to
Section 8.3(a) or 8.3(b).

     9.6  Entire  Agreement.  The  Agreement  constitutes  the full  and  entire
understanding  and  agreement  between the parties  with regard to the  subjects
hereof.

                  9.7  Indemnification  of Escrow Agent. The Company and each of
the  Purchasers  jointly and  severally  agree to  indemnify  and hold  harmless
Venture Law Group,  P.C.  ("VLG") against any and all losses,  claims,  damages,
liabilities,  costs, expenses and disbursements  (including fees and expenses of
counsel)  (collectively,  "Losses")  arising out of or in connection  with VLG's
services hereunder, other than Losses finally judicially determined to be solely
attributable to VLG's bad faith or gross negligence. Each of the Company and the
Purchasers  further  agree  that VLG  shall  not have any  liability  whatsoever
(whether direct or indirect, in contract or tort or otherwise) to the Company or
any Purchaser (or any party  claiming  through either of them) arising out of or
in  connection  with its  services  hereunder  except  in the  event  that  such
liability is finally  judicially  determined to be solely  attributable to VLG's
bad faith or gross negligence. The Company and the Purchasers further agree that
VLG shall be entitled to rely on their respective  representations,  warranties,
covenants  and  agreements  herein and  pursuant  hereto.  The  Company  and the
Purchasers acknowledge and agree that VLG is an intended third-party beneficiary
of this Section 9.7.

                  9.8  Notices,   etc.  All  notices  and  other  communications
required  or  permitted  under  the  Agreement  shall be in  writing  and may be
delivered in person,  by telecopy,  overnight  delivery service or United States
mail,  addressed to the Company or the Purchasers,  as the case may be, at their
respective addresses set forth at the beginning of in the Agreement,  or at such
other address as the Company or the Purchasers shall have furnished to the other
party in writing.  All notices and other  communications shall be effective upon
the  earlier of (a)  actual  receipt  thereof  by the  person to whom  notice is
directed or (b) (i) in the case of notices and  communications  sent by personal
delivery  or  telecopy,  the time such  notice or  communication  arrives at the
applicable  address or is successfully  sent to the applicable  telecopy number,
(ii) in the  case of  notices  and  communications  sent by  overnight  delivery
service,  at noon (local time) on the second business day following the day such
notice  or  communication  is  sent,  and  (iii)  in the  case  of  notices  and
communications  sent by United  States  mail,  five days  after  such  notice or
communication is deposited in the United States mail.

                  9.9  Severability  of the  Agreement.  If any provision of the
Agreement   shall  be   judicially   determined   to  be  invalid,   illegal  or
unenforceable,  the  validity,  legality  and  enforceability  of the  remaining
provisions shall not in any way be affected or impaired thereby.

     9.10  Counterparts.  The  Agreement  may  be  executed  in  any  number  of
counterparts,  each of which  shall be an  original,  but all of which  together
shall constitute one instrument.

                  9.11 Further Assurances.  Each party to the Agreement shall do
and perform or cause to be done and  performed  all such further acts and things
and  shall  execute  and  deliver  all  such  other  agreements,   certificates,
instruments  and documents as the other party hereto may  reasonably  request in
order to carry out the intent and  accomplish  the purposes of the Agreement and
the consummation of the transactions contemplated hereby.

                  9.12 Termination. In the event that the Closing shall not have
occurred on or before ninety (90) days from the date hereof, the Agreement shall
terminate at the close of business on such date.

                  9.13 Expenses.  The Company and each such Purchaser shall bear
its own expenses  incurred on its behalf with respect to the  Agreement  and the
transactions contemplated hereby, including fees of legal counsel.

     9.14 Currency. All references to "dollars" or "$" in the Agreement shall be
deemed to refer to United States dollars.
EXHIBIT A

                           FORM OF WARRANT CERTIFICATE
THE SECURITIES  REPRESENTED BY THIS  CERTIFICATE HAVE BEEN ACQUIRED FOR
         INVESTMENT  PURPOSES  ONLY  AND  HAVE NOT  BEEN  REGISTERED  UNDER  THE
         SECURITIES  ACT OF 1933.  THE SECURITIES MAY NOT BE SOLD OR TRANSFERRED
         IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM.

         ADDITIONALLY,  THE  TRANSFER  OF THE  SECURITIES  REPRESENTED  BY  THIS
         CERTIFICATE  IS  SUBJECT TO CERTAIN  RESTRICTIONS  SPECIFIED  IN A UNIT
         PURCHASE  AGREEMENT  DATED MAY 16,  1997  BETWEEN  THE  COMPANY AND THE
         ORIGINAL  PURCHASER,  AND NO TRANSFER OF  SECURITIES  SHALL BE VALID OR
         EFFECTIVE  ABSENT  COMPLIANCE  WITH SUCH  RESTRICTIONS.  ALL SUBSEQUENT
         HOLDERS OF THIS  CERTIFICATE WILL HAVE AGREED TO BE BOUND BY CERTAIN OF
         THE TERMS OF THE AGREEMENT,  INCLUDING SECTIONS 7.2, 8.3 AND 8.4 OF THE
         AGREEMENT.  A COPY  OF THE  AGREEMENT  MAY BE  OBTAINED  AT NO  COST BY
         WRITTEN  REQUEST MADE BY THE REGISTERED  HOLDER OF THIS  CERTIFICATE TO
         THE SECRETARY OF THE COMPANY.

         CUSIP: 74758B104

                      WARRANT TO PURCHASE SHARES OF COMMON
                      STOCK OF QUALITY SEMICONDUCTOR, INC.

         This certifies that _____________  (the "Holder"),  for value received,
is  entitled  to  purchase  from  Quality  Semiconductor,   Inc.,  a  California
corporation (the "Company"), ____________ (_______) fully paid and nonassessable
shares of the Company's Common Stock (the "Warrant  Shares") at a price of $8.50
per share of Common Stock (the "Stock Purchase  Price") at any time or from time
to time on or after the date hereof up to and including 5:00 p.m. (Pacific time)
on the Expiration Date (as defined below),  upon surrender to the Company at its
principal office at 851 Martin Avenue, Santa Clara, California 95050-2903 (or at
such other  location  as the  Company  may advise the Holder in writing) of this
Warrant  properly  endorsed with the Form of  Subscription  attached hereto duly
completed  and  signed  and upon  payment  by cash,  check or wire  transfer  of
immediately available funds of the aggregate Stock Purchase Price for the number
of shares for which this Warrant is being  exercised  determined  in  accordance
with the  provisions  hereof.  The Stock Purchase Price and the number of shares
purchasable hereunder are subject to adjustment as provided in Section 3 of this
Warrant.  "Expiration  Date"  means the  earlier of (i) May 31, 1998 or (ii) the
occurrence of an event the proposal of which is described in  subsection  (d) of
Section 3.4 which causes  termination  of this Warrant  under  Section 3.4. This
Warrant is issued  pursuant to the Unit Purchase  Agreement  between the Company
and the Holder dated May 16, 1997 (the "Purchase Agreement").
This Warrant is subject to the following terms and conditions:

         1. Exercise; Issuance of Certificates; Payment for Shares. This Warrant
is  exercisable  at the option of the Holder at any time or from time to time on
or after the date  hereof  and prior to or on the  Expiration  Date for all or a
portion of the Warrant Shares which may be purchased hereunder. The Holder shall
not be  entitled  to  exercise  this  Warrant  without  delivering  the  Form of
Subscription attached hereto, and the Company shall have no liability whatsoever
to any  Holder  by  reason  of any  attempted  exercise  hereof  if such Form of
Subscription  is not  delivered  or such  Holder  is  unable  to make any of the
representations  set forth  therein.  The Company agrees that the Warrant Shares
purchased  under this Warrant shall be and are deemed to be issued to the Holder
as the record  owner of such  shares as of the close of  business on the date on
which this Warrant shall have been surrendered and payment made for such shares.
Subject to the provisions of Section 2,  certificates  for the Warrant Shares so
purchased, together with any other securities or property to which the Holder is
entitled upon such  exercise,  shall be delivered to the Holder by the Company's
transfer  agent at the  Company's  expense  within a  reasonable  time after the
rights  represented by this Warrant have been exercised.  Each stock certificate
so  delivered  shall  be in  such  denominations  of  Warrant  Shares  as may be
requested  by the  Holder and shall be  registered  in the name of the Holder or
such other name as shall be designated by the Holder, subject to the limitations
contained in Sections 2 and 4 hereof.  If, upon exercise of this Warrant,  fewer
than all of the Warrant Shares  evidenced by this Warrant are purchased prior to
the date of expiration of this Warrant,  one or more new warrants  substantially
in the form of,  and on the  terms  in,  this  Warrant  will be  issued  for the
remaining number of Warrant Shares not purchased upon exercise of this Warrant.

         2.  Shares  to be  Fully  Paid;  Reservation  of  Shares.  The  Company
covenants  and  agrees  that all  Warrant  Shares  which may be issued  upon the
exercise of the rights represented by this Warrant will, upon issuance,  be duly
authorized,  validly  issued,  fully  paid and  nonassessable  and free from all
preemptive  rights of any shareholder  and free of all taxes,  liens and charges
with respect to the issue thereof. The Company further covenants and agrees that
it shall  approve,  and shall seek  shareholder  approval at its next  regularly
scheduled  meeting of shareholders  for, an increase in the number of authorized
shares of Common  Stock  sufficient  to provide  for the  exercise of the rights
represented  by this  Warrant.  Thereafter,  during the period  within which the
rights  represented by this Warrant may be exercised,  the Company covenants and
agrees that it will at all times have  authorized and reserved,  for the purpose
of issue or transfer upon exercise of the subscription  rights evidenced by this
Warrant,  a sufficient number of shares of authorized but unissued Common Stock,
when and as required to provide for the  exercise of the rights  represented  by
this Warrant.  The Company will use its reasonable best efforts to take all such
action as may be  necessary  to assure that such  shares of Common  Stock may be
issued as provided herein without violation of any applicable law or regulation,
or of  any  requirements  of  any  domestic  securities  exchange  or  automated
quotation system upon which the Common Stock may be listed.

         3.  Adjustment of Stock Purchase Price;  Number of Warrant Shares.  The
Stock  Purchase  Price and the number of  Warrant  Shares  purchasable  upon the
exercise of this Warrant shall be subject to  adjustment  from time to time upon
the occurrence of certain events described in this Section 3.
3.1  Adjustment  of  Purchase  Price.  In the  event  that the
Company  at any time or from time to time  after the  issuance  of this  Warrant
shall declare or pay,  without  consideration,  any dividend on the Common Stock
pa yable  in  Common  Stock  or in any  right  to  acquire Common  Stock  for no
consideration, or shall effect a subdivision of the outstanding shares of Common
Stock  into a  greater  number of  shares  of  Common  Stock  (by  stock  split,
reclassification  or otherwise  than by payment of a dividend in Common Stock or
in any right to acquire Common Stock), or in the event the outstanding shares of
Common  Stock  shall  be  combined  or  consolidated,   by  reclassification  or
otherwise,  into a lesser  number  of shares  of  Common  Stock,  then the Stock
Purchase  Price in effect  immediately  prior to such event shall,  concurrently
with the effectiveness of such event, be proportionately decreased or increased,
as  appropriate.  In the event that the Company  shall  declare or pay,  without
consideration,  any dividend on the Common Stock payable in any right to acquire
Common Stock for no consideration, then the Company shall be deemed to have made
a dividend  payable in Common  Stock in an amount of shares equal to the maximum
number of shares  issuable upon exercise of such rights to acquire Common Stock.
Upon each  adjustment of the Stock  Purchase Price pursuant to this Section 3.1,
the Holder shall thereafter be entitled to purchase, at the Stock Purchase Price
resulting from such adjustment, the number of shares of Common Stock obtained by
multiplying  the  Stock  Purchase  Price  in  effect  immediately  prior to such
adjustment by the number of shares of Common Stock  purchasable  pursuant hereto
immediately  prior to such  adjustment,  and dividing the product thereof by the
Stock Purchase Price resulting from such adjustment.

                  3.2 Adjustments for  Reclassification  and Reorganization.  If
the Common Stock shall be changed into the same or a different  number of shares
of any other  class or  classes of stock,  whether  by  capital  reorganization,
reclassification or otherwise (other than a subdivision or combination of shares
provided for in Section  3.1),  the Stock  Purchase  Price then in effect shall,
concurrently with the effectiveness of such reorganization or  reclassification,
be  proportionately  adjusted so that this Warrant shall  represent the right to
purchase,  in lieu of the number of shares of Common  Stock  which this  Warrant
would otherwise  represent the right to purchase,  that number of shares of such
other  class or  classes of stock  equivalent  to the number of shares of Common
Stock which this Warrant  would have  otherwise  entitled the Holder to purchase
immediately before that change at the same aggregate Stock Purchase Price.

                  3.3 Notice of  Adjustment.  Upon any  adjustment  of the Stock
Purchase  Price or any  increase  or  decrease in the number of shares of Common
Stock  purchasable  upon the exercise of this Warrant,  the Company shall within
five business days give written  notice  thereof,  by first class mail,  postage
prepaid,  addressed to the  registered  Holder of this Warrant at the address of
such Holder as shown on the books of the Company.  The notice shall be signed by
the Company's chief  financial  officer and shall state the Stock Purchase Price
resulting  from such  adjustment  and the increase or  decrease,  if any, in the
number of shares  purchasable  at such price upon the exercise of this  Warrant,
setting forth in reasonable  detail the method of calculation and the facts upon
which such calculation is based.

                  3.4      Other Notices.  If at any time:

     (a) the Company  shall propose to declare any cash dividend upon its Common
Stock;
(b) the  Company  shall  propose to declare or make any  dividend  or other
distribution  to the holders of its Common Stock,  whether in cash,  property or
other securities;

     (c)  the   Company   shall   propose  to  effect  any   reorganization   or
reclassification  of the capital  stock of the Company or any  consolidation  or
merger of the  Company  with or into  another  corporation  in which the Company
shall not be the continuing or surviving entity of such consolidation or merger,
or any  transaction or series of  transactions  in which an excess of 50% of the
Company's  voting power is transferred,  or any sale, lease or conveyance of all
or substantially all of the property of the Company; or

     (d) the  Company  shall  propose  to  effect  a  voluntary  or  involuntary
dissolution, liquidation or winding-up of the Company;

then, in any one or more of said cases,  the Company shall give, by certified or
registered mail, postage prepaid, addressed to the Holder at the address of such
Holder as shown on the books of the Company (i) at least 15 business days' prior
written  notice of the date on which the books of the  Company  shall close or a
record  shall be taken for such  dividend  or  distribution  or for  determining
rights  to  vote  in  respect  of  any  such  reorganization,  reclassification,
consolidation,  merger,  transaction  or series of  transactions,  sale,  lease,
conveyance, dissolution,  liquidation or winding-up, and (ii) in the case of any
such reorganization,  reclassification,  consolidation,  merger,  transaction or
series of transactions,  sale, lease,  conveyance,  dissolution,  liquidation or
winding-up,  at least 15 business days' written notice of the date when the same
shall take place.  Any notice  given in  accordance  with clause (i) above shall
also specify,  in the case of any dividend or distribution,  the record date for
such dividend or distribution,  which must be after the date thereof. Any notice
given in accordance  with clause (ii) above shall also specify the date on which
the holders of the Common Stock shall be entitled to exchange their Common Stock
for securities or other property,  if any, deliverable upon such reorganization,
reclassification,  consolidation, merger, transaction or series of transactions,
sale, lease, conveyance, dissolution, liquidation or winding-up, as the case may
be. In the event that the Holder does not  exercise  this  Warrant  prior to the
occurrence  of an event  described in clause (a) or (b) above,  the Holder shall
not be  entitled  to receive the  benefits  accruing to existing  holders of the
Common Stock in such event.  Upon the occurrence of an event described in clause
(c), the Holder shall be entitled thereafter, in lieu of and in substitution for
all other rights under this Warrant, upon payment of the Stock Purchase Price in
effect  immediately  prior to such  action,  to receive  upon  exercise  of this
Warrant the class and number of shares which the Holder would have been entitled
to receive after the  occurrence  of such event had this Warrant been  exercised
immediately prior to such event. Upon the occurrence of an event the proposal of
which is described in clause (d), this Warrant shall terminate.

         4. Issue Tax. The issuance of certificates  for the Warrant Shares upon
the exercise of this Warrant shall be made without  charge to the Holder for any
issue tax in respect thereof;  provided,  however, that the Company shall not be
required to pay any tax which may be payable in respect of any transfer involved
in the issuance and delivery of any certificate in a name other than that of the
then holder of this Warrant being exercised.
5. No Voting or  Dividend  Rights;  Limitation  of  Liability.  Nothing
contained in this  Warrant  shall be  construed  as  conferring  upon the Holder
hereof the right to vote or to consent or to receive  notice as a shareholder in
respect of meetings of shareholders for the election of directors of the Company
or any other matters or any rights  whatsoever as a shareholder  of the Company.
Except for the adjustment to the Stock Purchase Price pursuant to Section 3.1 in
the event of a dividend on the Common Stock  payable in shares of Common  Stock,
no dividends or interest  shall be payable or accrued in respect of this Warrant
or the interest  represented hereby or the Warrant Shares purchasable  hereunder
until,  and only to the extent that, this Warrant shall have been exercised.  No
provisions  hereof,  in the  absence  of  affirmative  action  by the  Holder to
purchase  Warrant  Shares,  and no mere  enumeration  herein  of the  rights  or
privileges of the Holder hereof, shall give rise to any liability of such Holder
for the Stock  Purchase  Price or as a shareholder  of the Company  whether such
liability is asserted by the Company or by its creditors.

     6.  Restrictions  on   Transferability   of  Securities;   Compliance  With
Securities Act.

                  6.1  Restrictions  on  Transferability.  The  Warrant  and the
Warrant  Shares  (collectively,  the  "Securities"),  shall not be  transferable
except upon the conditions specified in the Purchase Agreement, which conditions
are intended to insure  compliance with the provisions of the Securities Act and
applicable "blue sky" law.

                  6.2 Restrictive  Legend.  Each  certificate  representing  the
Securities or any other securities  issued in respect of the Securities upon any
stock split, stock dividend, recapitalization,  merger, consolidation or similar
event shall  (unless  otherwise  permitted  by the  provisions  of the  Purchase
Agreement) be stamped or otherwise imprinted with a legend  substantially in the
following  form (in  addition  to any legend  required  under  applicable  state
securities laws):

                  THE  SECURITIES  REPRESENTED  BY THIS  CERTIFICATE  HAVE  BEEN
                  ACQUIRED  FOR  INVESTMENT  PURPOSES  ONLY  AND  HAVE  NOT BEEN
                  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933. THE SECURITIES
                  MAY  NOT BE  SOLD  OR  TRANSFERRED  IN  THE  ABSENCE  OF  SUCH
                  REGISTRATION OR AN EXEMPTION THEREFROM.

                  ADDITIONALLY,  THE TRANSFER OF THE  SECURITIES  REPRESENTED BY
                  THIS CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS  SPECIFIED
                  IN A UNIT  PURCHASE  AGREEMENT  DATED MAY 16, 1997 BETWEEN THE
                  COMPANY  AND  THE  ORIGINAL  PURCHASER,  AND  NO  TRANSFER  OF
                  SECURITIES SHALL BE VALID OR EFFECTIVE ABSENT  COMPLIANCE WITH
                  SUCH RESTRICTIONS.  ALL SUBSEQUENT HOLDERS OF THIS CERTIFICATE
                  WILL HAVE  AGREED TO BE BOUND BY  CERTAIN  OF THE TERMS OF THE
                  AGREEMENT,   INCLUDING  SECTIONS  7.2,  8.3  AND  8.4  OF  THE
                  AGREEMENT.  A COPY OF THE AGREEMENT MAY BE OBTAINED AT NO COST
                  BY  WRITTEN  REQUEST  MADE BY THE  REGISTERED  HOLDER  OF THIS
                  CERTIFICATE TO THE SECRETARY OF THE COMPANY.
7.  Modification  and Waiver.  This Warrant and any provision hereof may be
changed,  waived,  discharged  or  terminated  only by an  instrument in writing
signed by the party against which enforcement of the same is sought.

         8.  Notices.  Any notice,  request or other  communication  required or
permitted to be given or delivered to the Holder  hereof or the Company shall be
in writing and may,  except as  otherwise  set forth  herein,  be  delivered  in
person, by telecopy, overnight delivery service or United States mail, addressed
to the  Holder at its  address as shown on the books of the  Company,  or to the
Company  at the  address  indicated  therefor  in the  first  paragraph  of this
Warrant,  or at such  other  address  as the  Holder or the  Company  shall have
furnished  to the  other  party in  writing.  All  notices,  requests  and other
communications shall be effective upon the earlier of (a) actual receipt thereof
by the person to whom  notice is  directed  or (b) (i) in the case of notices or
communications  sent by personal  delivery or telecopy,  the time such notice or
communication  arrives at the applicable  address or is successfully sent to the
applicable  telecopy number, (ii) in the case of notices and communications sent
by overnight  delivery service,  at noon (local time) on the second business day
following the day such notice or communication is sent, and (iii) in the case of
notices and  communications  sent by United  States  mail,  five days after such
notice or communication is deposited in the United States mail.

         9. Descriptive  Headings and Governing Law. The descriptive headings of
the several sections and paragraphs of this Warrant are inserted for convenience
only  and do not  constitute  a part of this  Warrant.  This  Warrant  shall  be
governed in all  respects by and  construed in  accordance  with the laws of the
State of California without regard to conflicts of laws principles.

         10. Lost Warrants or Stock  Certificates.  The Company  represents  and
warrants to the Holder that upon receipt of evidence reasonably  satisfactory to
the Company of the loss,  theft,  destruction,  or  mutilation of any Warrant or
stock certificate and, in the case of any such loss, theft or destruction,  upon
receipt of an indemnity and, if requested,  bond reasonably  satisfactory to the
Company or, in the case of any such mutilation  upon surrender and  cancellation
of such Warrant or stock  certificate,  the Company at its expense will make and
deliver a new Warrant or stock certificate,  of like tenor, in lieu of the lost,
stolen, destroyed or mutilated Warrant or stock certificate.

         11.  Fractional  Shares.  No  fractional  shares  shall be issued  upon
exercise of this Warrant.  The Company shall,  in lieu of issuing any fractional
share,  pay the  Holder  entitled  to such  fraction a sum in cash equal to such
fraction  multiplied by the market price of the Common Stock, which shall be, on
any date,  the closing price for the Common Stock or the closing bid if no sales
were reported, as quoted on The Nasdaq Stock Market.

[Signature page follows]
IN WITNESS  WHEREOF,  the Company has caused this Warrant to be executed by
its officers, thereunto duly authorized this _____ day of ________ 1997.

QUALITY SEMICONDUCTOR, INC.

By:  _____________________________________
     Nme:    John Goldsberry
     Title:  Vice President - Finance and
             Chief Financial Officer
FORM OF SUBSCRIPTION

(To be signed only upon exercise of Warrant)

To:  Quality Semiconductor, Inc.
851 Martin Avenue
Santa Clara, CA  95050-2903

         The undersigned,  the Holder of the within Warrant,  hereby irrevocably
elects to exercise the purchase  right  represented  by such Warrant for, and to
purchase thereunder, ____________________ (__________) shares of Common Stock of
Quality  Semiconductor,  Inc.  (the  "Company")  and herewith  makes  payment of
$__________  therefor  and  requests  that the  certificates  for such shares be
issued in the name of, and  delivered to  ______________________  at the address
set forth below.

         The  undersigned  represents,  unless the  exercise of this Warrant has
been  registered  under the Securities Act of 1933, as amended (the  "Securities
Act"),  that (i) the  undersigned  is  acquiring  such Common  Stock for his own
account for investment and not with a view to or for sale in connection with any
distribution thereof (except for any resale pursuant to a Registration Statement
under  the  Securities  Act),  (ii)  the  undersigned  has  such  knowledge  and
experience in financial and business  matters as to be capable of evaluating the
merits and risks of the undersigned's  investment in the shares of Common Stock,
(iii) the  undersigned  has  received  all of the  information  the  undersigned
requested  from  the  Company  and  the  undersigned   considers   necessary  or
appropriate  for deciding  whether to purchase the shares,  (iv) the undersigned
has the ability to bear the economic risks of his  prospective  investment,  and
(v)  the  undersigned  is  able,  without  materially  impairing  his  financial
condition,  to hold the shares of Common Stock for an indefinite  period of time
and to suffer complete loss on his investment. The undersigned is an "accredited
investor" as defined in Regulation D of the Securities Act on the date hereof.

DATED: ____________________

                                     __________________________________________
                                     (Signature must conform in all respects to
                                     name of Holder as specified on the face of
                                     the Warrant)

                                     __________________________________________
                                     __________________________________________
                                                      (Address)
EXHIBIT B

                           WIRE TRANSFER INSTRUCTIONS

The following wire transfer instructions should be used:

SILICON VALLEY BANK
San Jose, CA
ABA(routing & transit) # 121140399
Account # 3300035861
Account Name: California State Bar Account, Venture Law Group
By Order of: "Name of Sender"
Make reference to:  Quality Semiconductor, Inc.
EXHIBIT 99

                                        For more information contact:

                                        John P. Goldsberry
                                        Chief Financial Officer
                                        Quality Semiconductor, Inc.
                                        (408) 450-8000

                                        Morgen-Walke Associates, Inc.
                                        Suzanne Craig, Jim Byers, Laura Guerrant
                                        (212) 850-5600
 

FOR IMMEDIATE RELEASE

          QUALITY SEMICONDUCTOR ANNOUNCES $9.2 MILLION PRIVE PLACEMENT
                          OF COMMON STOCK AND WARRANTS

SANTA CLARA,  CA - (May 22, 1997) - Quality  Semiconductor,  Inc.  (Nasdaq:QUAL)
today announced that it had arranged a private  placement of 108,000 units, each
consisting  of 10 shares of common  stock and a one-year  warrant to purchase an
additional  share of common stock. The units were priced at $85.00 per unit, for
a total of $9.2 million. The transaction is anticipated to close on or about May
28, 1997.
         Proceeds from the private  placement will be used for general corporate
purposes and to fund the growth of its  business.  The company will exercise its
best  efforts  to file  within  30 days a  registration  statement  on Form  S-3
covering  the shares of common  stock and  warrant  shares  associated  with the
private  placement.  Needham &  Company,  Inc.  acted as agent  for the  private
placement.
         "We are pleased to have arranged this equity  private  placement  which
will allow us to continue to expand the scope of our operations," commented Paul
Gupta, President and Chief Executive Officer of Quality Semiconductor.
         Except  for  historical   information  contained  herein,  the  matters
discussed in this press release are forward-looking  statements that are subject
to certain risks and uncertainties that could cause the actual results to differ
materially from those projected, including, among others, litigation, the impact
of competitive products and pricing,  general economic conditions and conditions
specific to the  semiconductor  industry,  fluctuations in customer demand,  the
timing  and  market  acceptance  of  new  product   introductions,   the  timely
development  of new products and other risk factors  listed in the Company's SEC
reports including the Company's  periodic reports filed pursuant to the Security
Exchange  Act of 1934 and the  Registration  Statement  on form S-1 filed by the
Company in connection with its initial public  offering.  Quality  Semiconductor
assumes no obligation to update the information included in this press release.

                                   -continued-
Quality   Semiconductor,    Inc.   Designs,    develops   and   markets
high-performance  logic  as well as  networking  and  logic-intensive  specialty
memory  semiconductor   products.  The  Company  targets  systems  manufacturers
principally in the networking,  personal computer and workstation  markets.  The
Company's  logic  products  include the 3.3-volt  and 5-volt  QSFCT  families of
high-speed,  low noise interface logic devices,  the QuickSwitch  family of high
speed,  low  resistance  bus  switches,  a family of low-skew  clock  management
products,  a family of analog switch  devices and new JTAG products  designed to
allow  board-level   testing  of  complex  products.   Quality   Semiconductor's
networking  products  include two Fast Ethernet CMOS  transceivers  that provide
high  integration  solutions  for the  adapter,  repeater,  switch  and card bus
markets.
                                       ###