Document:

EXHIBIT 4.1

                          SECURITIES PURCHASE AGREEMENT
                        -------------------------------

     SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated as of May 14, 2001,
by and among GENUS, INC., a corporation organized under the laws of the State of
California  (the  "Company"), and the purchasers (the "Purchasers") set forth on
the  execution  pages  hereof  (the  "Execution  Pages").

     WHEREAS:

     A.     The  Company  and  each  Purchaser are executing and delivering this
Agreement  in  reliance upon the exemption from securities registration afforded
by the provisions of Regulation D ("Regulation D"), as promulgated by the United
States  Securities  and Exchange Commission (the "SEC") under the Securities Act
of  1933,  as  amended  (the  "Securities  Act").

     B.     Each  Purchaser  desires  to  purchase,  severally  and not jointly,
subject  to the terms and conditions stated in this Agreement, (i) shares of the
Company's  common stock, no par value (the "Common Stock"), and (ii) warrants in
the  form  attached  hereto  as  Exhibit  A  (including  any  warrants issued in
replacement  thereof,  the  "Warrants"), to acquire shares of Common Stock.  The
shares  of  Common  Stock issuable upon exercise of or otherwise pursuant to the
Warrants  are  referred  to  herein  as  the  "Warrant  Shares."

     C.     Contemporaneous  with  the execution and delivery of this Agreement,
the  parties hereto are executing and delivering a Registration Rights Agreement
in  the form attached hereto as Exhibit B (the "Registration Rights Agreement"),
pursuant  to which the Company has agreed to provide certain registration rights
under  the  Securities Act and the rules and regulations promulgated thereunder,
and  applicable  state  securities  laws.

     NOW,  THEREFORE,  the  Company  and the Purchasers hereby agree as follows:

1.     CERTAIN  DEFINITIONS.
       --------------------
     For purposes of this Agreement, the following terms shall have the meanings
ascribed  to  them  as  provided  below:

     "Business  Day"  shall  mean  any  day on which the principal United States
securities  exchange  or  trading  market on which the Common Stock is listed or
traded  as  reported  by  NTMS  (as  defined  below)  is  open  for  trading.

     "Closing Price" shall mean for the Common Stock as of any date, the closing
bid price of such security on the principal United States securities exchange or
trading  market  on  which  such security is listed or traded as reported by the
Research  Service  of  Nasdaq  Trading  and  Market  Services  (or  a comparable
reporting  service of national reputation selected by the Purchasers as provided
in Section 8(n) hereof, and reasonably acceptable to the Company if the Research
Service  of Nasdaq Trading and Market Services is not then reporting closing bid
prices  of  such  security) (collectively, "NTMS"), or if the foregoing does not
apply,  the  last  reported  sale price of such security in the over-the-counter
market  on  the electronic bulletin board for such security as reported by NTMS,
or,  if  no sale price is reported for such security by NTMS, the average of the
bid  prices  of  any  market  makers  for such security as reported in the "pink
sheets"  by  Pink  Sheets LLC (formerly the National Quotation Bureau, Inc.), in
each  case  for  such  date  or,  if such date was not a Trading Day (as defined
below)  for such security, on the next preceding day which was a Trading Day. If
the  Closing Price cannot be calculated for a share of Common Stock as of either
of  such dates on any of the foregoing bases, the Closing Price of such security
on  such  date  shall  be  the  fair market value as determined by an investment
banking  firm  selected  by  the  Company  and  reasonably  acceptable  to  the
Purchasers,  with  the  costs  of  such  appraisal  to  be borne by the Company.

     "Investment  Amount"  shall  mean  the  dollar amount to be invested in the
Company  at  the Closing pursuant to this Agreement by a Purchaser, as set forth
on  the  Execution  Page  hereto  executed  by  such  Purchaser.

     "Market  Price"  shall mean, with respect to any date of determination, the
Closing  Price  on  the  Trading  Day  immediately  preceding  such  date  of
determination, appropriately adjusted to reflect any stock dividend, stock split
or  similar  transaction  during  either  such  relevant  period.

     "Material Adverse Effect" shall mean any material adverse effect on (i) the
Securities, (ii) the ability of the Company to perform its obligations hereunder
(including  the  issuance  of  the  Shares and the Warrants), under the Warrants
(including  the issuance of the Warrant Shares) or under the Registration Rights
Agreement  or (iii) the business, operations, properties, prospects or financial
condition  of  the  Company  and  its  subsidiaries,  taken  as  a  whole.

     "Pro  Rata  Percentage"  shall  mean,  with  respect  to  any  Purchaser, a
percentage  computed  by  dividing  such  Purchaser's  Investment  Amount by the
aggregate  Investment  Amounts  of  all  Purchasers.

     "Securities"  shall  mean  the Shares, the Warrants and the Warrant Shares.

     "Shares"  means  the  shares  of  Common Stock to be issued and sold by the
Company  and  purchased  by  the  Purchasers  at  the  Closing.

     "Trading  Day" shall mean a Business Day on which at least 10,000 shares of
Common  Stock  are  traded on the principal United States securities exchange or
trading  market  on which such security is listed or traded as reported by NTMS.

2.     PURCHASE  AND  SALE  OF  SHARES  AND  WARRANTS.
       ----------------------------------------------

     a.     Generally.  Except  as  otherwise  provided  in  this  Section 2 and
subject to the satisfaction (or waiver) of the conditions set forth in Section 6
and  Section  7  below,  each  Purchaser shall purchase the number of Shares and
Warrants  determined  as provided in this Section 2, and the Company shall issue
and  sell  such  number  of  Shares  and  Warrants  to  each  Purchaser for such
Purchaser's  Investment  Amount  as provided below. The Company's agreement with
each  of  the Purchasers is a separate agreement, and the sale of the Securities
to  each  of  the  Purchasers  is  a  separate  sale.

     b.     Number  of  Closing  Shares  and  Warrants; Form of Payment; Closing
Date.

     i.     On  the  Closing Date (as defined below), the Company shall sell and
each Purchaser shall buy (A) the number of Shares as is equal to the quotient of
(I)  such  Purchaser's  Investment Amount divided by (II) $3.00 and (B) Warrants
exercisable for a number of shares of Common Stock equal to 50% of the number of
Shares  referred to in subclause (A) above.  On the Closing Date, each Purchaser
shall  pay  the  Company  an amount equal to such Purchaser's Investment Amount.

     ii.     On the Closing Date, each Purchaser shall pay its Investment Amount
by wire transfer to the Company, in accordance with the Company's written wiring
instructions  against  delivery of certificates representing the Shares and duly
executed  Warrants  being  purchased  by  such  Purchaser, and the Company shall
deliver such Shares and Warrants against delivery of such Purchaser's Investment
Amount.

     iii.     Subject  to the satisfaction (or waiver) of the conditions thereto
set forth in Section 6 and Section 7 below, the date and time of the sale of the
Shares and the Warrants pursuant to this Agreement (the "Closing") shall be 4:00
pm. San Francisco time on May 14, 2001 or such other date or time as Wells Fargo
Van  Kasper  ("WFVK")  and the Company may mutually agree ("Closing Date").  The
Closing shall occur at the San Francisco offices of WFVK, or at such other place
as  WFVK  and  the  Company  may  otherwise  mutually  agree.

3.     THE  PURCHASER'S  REPRESENTATIONS  AND  WARRANTIES.
       --------------------------------------------------

     Each  Purchaser  severally  and  not jointly represents and warrants to the
Company  as  follows:

     a.     Purchase  for  Own  Account.  The  Purchaser  is  purchasing  the
Securities  for the  Purchaser's own account and not with a present view towards
the  distribution  thereof.  The  Purchaser  understands that the Purchaser must
bear  the  economic  risk of this investment indefinitely, unless the Securities
are  registered  pursuant  to  the  Securities  Act  and  any  applicable  state
securities or blue sky laws or an exemption from such registration is available,
and that the Company has no present intention of registering any such Securities
other  than  as  contemplated  by  the  Registration  Rights  Agreement.
Notwithstanding  anything  in  this  Section 3(a) to the contrary, by making the
foregoing  representation,  the  Purchaser does not agree to hold the Securities
for  any minimum or other specific term and reserves the right to dispose of the
Securities  at  any  time  in  accordance  with  or  pursuant  to a registration
statement  or  an  exemption  from registration under the Securities Act and any
applicable  state  securities  laws.

     b.     Information.  The  Purchaser  has  been  furnished  all  materials
(excluding  any  material  nonpublic  information)  relating  to  the  business,
finances  and  operations  of  the  Company  and  its subsidiaries and materials
relating to the offer and sale of the Securities that have been requested by the
Purchaser.  The  Purchaser has been afforded the opportunity to ask questions of
the  Company  and  has  received  what the Purchaser believes to be satisfactory
answers to any such inquiries.  The Purchaser understands that its investment in
the  Securities  involves a high degree of risk.  Neither such inquiries nor any
other  due  diligence investigation conducted by the Purchaser or its counsel or
any  of  its representatives shall modify, amend or affect the Purchaser's right
to  rely  on the Company's representations and warranties contained in Section 4
below.

     c.     Governmental  Review.  The  Purchaser  understands  that  no  United
States  federal  or  state agency or any other government or governmental agency
has  passed  upon  or  made any recommendation or endorsement of the Securities.

     d.     Authorization;  Enforcement.  The  Purchaser has the requisite power
and authority to enter into and perform its obligations under this Agreement and
to  purchase  the  Shares  and the Warrants in accordance with the terms hereof.
This  Agreement  has been duly and validly authorized, executed and delivered on
behalf  of  the  Purchaser and is a valid and binding agreement of the Purchaser
enforceable  against  the  Purchaser  in  accordance  with its terms, subject to
applicable  bankruptcy,  insolvency,  reorganization,  moratorium,  fraudulent
transfer  and  other laws affecting creditors' rights and remedies generally and
to  general principles of equity (regardless of whether enforcement is sought in
a  proceeding  at  law  or  in  equity).

     e.     Transfer  or  Resale.  The  Purchaser understands that (i) except as
provided  in the Registration Rights Agreement, the Securities have not been and
are  not being registered under the Securities Act or any state securities laws,
and may not be transferred unless (a) subsequently registered thereunder, or (b)
the  Purchaser  shall  have  delivered  to  the  Company  an  opinion of counsel
reasonably  acceptable to the Company (which opinion shall be in form, substance
and  scope  customary for opinions of counsel in comparable transactions) to the
effect  that the Securities to be sold or transferred may be sold or transferred
under  an exemption from such registration, and (ii) neither the Company nor any
other  person  is  under  any  obligation  to register such Securities under the
Securities  Act  or  any  state  securities laws or to comply with the terms and
conditions of any exemption thereunder, in each case, other than pursuant to the
Registration  Rights  Agreement.

     f.     Legends.  The Purchaser understands that the Shares and the Warrants
and, until such time as the Shares and Warrant Shares have been registered under
the  Securities  Act  as  contemplated  by  the Registration Rights Agreement or
otherwise  may be sold by the Purchaser under Rule 144, the certificates for the
Shares  and  Warrant  Shares  may bear a restrictive legend in substantially the
following  form:

          The  securities  represented  by  this  certificate  have  not  been
          registered  under  the  Securities  Act  of  1933,  as amended, or the
          securities  laws  of  any  state  of the United States. The securities
          represented  hereby  may  not  be offered or sold in the absence of an
          effective  registration  statement for the securities under applicable
          securities laws unless offered, sold or transferred under an available
          exemption  from  the  registration  requirements  of  those  laws.

     The  legend  set forth above shall be removed and the Company shall issue a
certificate  without  such legend to the holder of any Security upon which it is
stamped, if (a) the sale of such Security is registered under the Securities Act
or  (b) in connection with the resale of such Security, such holder provides the
Company  with  an opinion of counsel, in form, substance and scope customary for
opinions of counsel in comparable transactions, to the effect that a public sale
or  transfer  of  such  Security  may  be  made  without  registration under the
Securities  Act  or  (c)  such  holder  provides  the  Company  with  reasonable
assurances  that  such  Security  can  be sold under Rule 144(k).  The Purchaser
agrees  to  sell all Securities, including those represented by a certificate(s)
from  which  the  legend has been removed, pursuant to an effective registration
statement  or  under  an  exemption  from  the  registration requirements of the
Securities Act.  The legend shall be removed when such Security is sold pursuant
to  an effective registration statement or may be sold by a Purchaser who is not
an  "affiliate"  of  the  Company  under  Rule  144(k).

     g.     Investor  Status.  The  Purchaser is an "accredited investor" within
the  meaning  of  Rule  501 Regulation D under the Securities Act. In the normal
course  of  its  business,  it invests in or purchases securities similar to the
Securities  and  it  has such knowledge and experience in financial and business
matters  as  to  be capable of evaluating the merits and risks of purchasing the
Securities.

4.     REPRESENTATIONS  AND  WARRANTIES  OF  THE  COMPANY.
       --------------------------------------------------

     The  Company  represents  and  warrants  to  each  Purchaser  as  follows:

     a.     Organization  and  Qualification.  Each  of  the  Company  and  its
subsidiaries  is a corporation duly organized and existing under the laws of the
jurisdiction  in which it is incorporated, and has the requisite corporate power
to own its properties and to carry on its business as now being conducted.  Each
of  the  Company and its subsidiaries is duly qualified as a foreign corporation
to do business and is in good standing in every jurisdiction in which the nature
of the business conducted by it makes such qualification necessary and where the
failure  so  to qualify would have a Material Adverse Effect. Schedule 4(a) sets
forth  the  Company's  jurisdiction of incorporation and the name of each of the
Company's  subsidiaries  and  its  jurisdiction  of  incorporation.

     b.  Authorization; Enforcement. (i) The Company has the requisite corporate
power  and  authority  to  enter  into  and  perform  its obligations under this
Agreement, the Warrants and the Registration Rights Agreement, to issue and sell
the Shares and the Warrants in accordance with the terms hereof and to issue the
Warrant Shares upon exercise of the Warrants in accordance with the terms of the
Warrants;  (ii)  the  execution, delivery and performance of this Agreement, the
Warrants  and  the  Registration  Rights  Agreement  by  the  Company  and  the
consummation  by  it  of  the  transactions  contemplated  hereby  and  thereby
(including, without limitation, the reservation for issuance and issuance of the
Shares  and  the  issuance  of the Warrants and the reservation for issuance and
issuance of the Warrant Shares) have been duly authorized by the Company's Board
of  Directors  and no further consent or authorization of the Company, its Board
of Directors or its shareholders is required; (iii) this Agreement has been duly
executed and delivered by the Company; and (iv) this Agreement constitutes, and,
upon  execution and delivery by the Company and the other parties thereto to the
extent  required  of  the  Registration  Rights Agreement and the Warrants, such
agreements  will  constitute,  valid  and  binding  obligations  of  the Company
enforceable  against  the  Company  in  accordance  with their respective terms,
subject  to  applicable  bankruptcy,  insolvency,  reorganization,  moratorium,
fraudulent  transfer  and  other  laws  affecting creditors' rights and remedies
generally and to general principles of equity (regardless of whether enforcement
is  sought  in  a  proceeding  at  law  or  in  equity).

     c.  Capitalization.  The  capitalization  of  the  Company  and each of its
subsidiaries  as of the date hereof is set forth on Schedule 4(c), including the
authorized  capital  stock,  the  number  of  shares issued and outstanding, the
number  of  shares  issuable and reserved for issuance pursuant to the Company's
stock  option  plans,  the  number  of shares issuable and reserved for issuance
pursuant  to securities exercisable for, or convertible into or exchangeable for
any  shares  of  capital  stock. All of such outstanding shares of the Company's
capital  stock  have  been, or upon issuance will be, validly issued, fully paid
and  nonassessable.  Except  as set forth on Schedule 4(c), no shares of capital
stock of the Company (including the Shares and the Warrant Shares) or any of the
subsidiaries are subject to preemptive rights or any other similar rights of the
shareholders  of  the  Company  or  any  liens  or  encumbrances. Except for the
Securities  and as disclosed in Schedule 4(c), as of the date of this Agreement,
(i)  there  are no outstanding options, warrants, scrip, rights to subscribe to,
calls  or commitments of any character whatsoever to which the Company or any of
the  subsidiaries  is  a party relating to the issuance by the Company or any of
its  subsidiaries  of  securities  or  rights convertible into or exercisable or
exchangeable  for,  any  shares  of  capital  stock of the Company or any of its
subsidiaries, or arrangements by which the Company or any of its subsidiaries is
or  may  become bound to issue additional shares of capital stock of the Company
or  such  subsidiaries,  and  (ii) there are no agreements or arrangements under
which  the  Company or any of its subsidiaries is obligated to register the sale
of  any  of  its  or  their  securities  under  the  Securities  Act (except the
Registration  Rights Agreement). Except as set forth on Schedule 4(c), there are
no  securities or instruments containing antidilution or similar provisions that
may  be triggered by the issuance of the Securities in accordance with the terms
of  this  Agreement,  the  Warrants or the Registration Rights Agreement and the
holders  of  the  securities  and  instruments listed on such Schedule 4(c) have
waived any rights they may have under such antidilution or similar provisions in
connection  with  the issuance of the Securities in accordance with the terms of
this  Agreement,  the Warrants or the Registration Rights Agreement. The Company
has  made  available  to each Purchaser true and correct copies of the Company's
Articles  of  Incorporation  as  in  effect  on  the  date  hereof ("Articles of
Incorporation"),  the  Company's  By-laws  as  in effect on the date hereof (the
"By-laws")  and  all  other  instruments  and  agreements  governing  securities
convertible  into  or  exercisable  or  exchangeable  for  capital  stock of the
Company, except for stock options granted under any benefit plan of the Company.

     d.     Issuance  of Shares.  The Shares are duly authorized and when issued
and  paid for in accordance with the terms hereof, will be validly issued, fully
paid and non-assessable, and free from all taxes, liens, claims and encumbrances
(other  than  those imposed through acts or omissions of the Purchaser thereof),
and  will  not  be  subject  to  preemptive  rights  or  other similar rights of
shareholders  of  the  Company  and  will not impose personal liability upon the
holder  thereof.  The  Warrant  Shares  are  duly  authorized  and  reserved for
issuance,  and,  upon  exercise  of  the  Warrants  in accordance with the terms
thereof, will be validly issued, fully paid and non-assessable and free from all
taxes  and liens, claims and encumbrances (other than those imposed through acts
or  omissions  of  the Purchaser thereof), and will not be subject to preemptive
rights  or  other  similar  rights  of  shareholders of the Company and will not
impose  personal  liability  upon  the  holder  thereof.

     e.     No  Conflicts.  The  execution,  delivery  and  performance  of this
Agreement,  the  Registration  Rights Agreement and the Warrants by the Company,
and  the consummation by the Company of the transactions contemplated hereby and
thereby  (including,  without  limitation,  the  reservation  for  issuance  and
issuance  of the Shares and the Warrant Shares and the issuance of the Warrants)
will  not  (i)  conflict  with  or  result  in  a  violation  of the Articles of
Incorporation  or  By-laws or (ii) conflict with, or constitute a default (or an
event  which,  with  notice  or  lapse  of time or both, would become a default)
under,  or  give to others any rights of termination, amendment, acceleration or
cancellation  of  any agreement, indenture or instrument to which the Company or
any  of  its subsidiaries is a party, or result in a violation of any law, rule,
regulation,  order,  judgment or decree (including (assuming the accuracy of the
representations  and warranties of the Purchasers) the United States federal and
state  securities  laws and regulations) applicable to the Company or any of its
subsidiaries  or  by  which  any  property or asset of the Company or any of its
subsidiaries is bound or affected (except, with respect to clause (ii), for such
conflicts,  defaults, terminations, amendments, accelerations, cancellations and
violations  as  would  not,  individually  or  in the aggregate, have a Material
Adverse  Effect).  Neither  the  Company  nor  any  of  its  subsidiaries  is in
violation  of  its  Articles  of Incorporation, By-laws and other organizational
documents and neither the Company nor any of its subsidiaries is in default (and
no event has occurred which, with notice or lapse of time or both, would put the
Company or any of its subsidiaries in default) under, nor has there occurred any
event  giving  others  (with  notice  or  lapse  of  time or both) any rights of
termination,  amendment,  acceleration  or  cancellation  of,  any  agreement,
indenture  or  instrument  to  which the Company or any of its subsidiaries is a
party,  except  for  actual  or possible violations, defaults or rights as would
not,  individually  or  in  the  aggregate, have a Material Adverse Effect.  The
businesses  of  the  Company  and  its  subsidiaries  are not being conducted in
violation of any law, ordinance or regulation of any governmental entity, except
for actual or possible violations, if any, the sanctions for which either singly
or  in  the  aggregate  would  not  have  a  Material Adverse Effect.  Except as
specifically contemplated by this Agreement and as required under the Securities
Act  and  any  applicable  state securities laws, the Company is not required to
obtain  any  consent, approval, authorization or order of, or make any filing or
registration  with,  any  court or governmental agency or any regulatory or self
regulatory  agency  in  order  for  it to execute, deliver or perform any of its
obligations  under this Agreement (including without limitation the issuance and
sale  of  the  Shares  and Warrants as provided hereby), the Warrants (including
without  limitation  the  issuance  of  the  Warrant Shares) or the Registration
Rights  Agreement,  in each case in accordance with the terms hereof or thereof.
The  Company is not in violation of the listing requirements of The Nasdaq Stock
Market and does not reasonably anticipate that the Common Stock will be delisted
by  The  Nasdaq  Stock  Market in the foreseeable future based on its rules (and
interpretations  thereof)  as  currently  in  effect.

     f.     SEC  Documents;  Financial  Statements.  Since  January 1, 2000, the
Company  has  timely  filed  all reports, schedules, forms, statements and other
documents  required  to  be  filed by it with the SEC pursuant to the Securities
Exchange  Act  of  1934,  as  amended  (the  "Exchange  Act"), and has filed all
registration  statements and other documents required to be filed by it with the
SEC pursuant to the Securities Act (all of the foregoing filed prior to the date
hereof, and all exhibits included therein and financial statements and schedules
thereto  and  documents  incorporated  by  reference  therein, being hereinafter
referred  to  herein as the "SEC Documents").  The Company has made available to
each  Purchaser  true  and  complete copies of the SEC Documents, except for the
exhibits  and  schedules  thereto and the documents incorporated therein.  As of
their respective dates, the SEC Documents complied in all material respects with
the  requirements of the Exchange Act or the Securities Act, as the case may be,
and  the  rules  and regulations of the SEC promulgated thereunder applicable to
the  SEC  Documents,  and none of the SEC Documents, at the time they were filed
with  the  SEC,  contained any untrue statement of a material fact or omitted to
state  a  material  fact  required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading.  Any statements made in any such SEC Documents that are or
were required to be updated or amended under applicable law have been so updated
or  amended.  As  of  their  respective  dates,  the financial statements of the
Company  included  in  the  SEC Documents complied in all material respects with
applicable  accounting  requirements  and the published rules and regulations of
the  SEC  applicable  with respect thereto.  Such financial statements have been
prepared  in  accordance  with  United  States  generally  accepted  accounting
principles, consistently applied, during the periods involved (except (i) as may
be  otherwise  indicated  in  such financial statements or the notes thereto, or
(ii)  in  the  case  of unaudited interim statements, to the extent they may not
include  footnotes or may be condensed or summary statements) and fairly present
in  all material respects the consolidated financial position of the Company and
its subsidiaries as of the dates thereof and the results of their operations and
cash  flows  for  the  periods  then  ended  (subject,  in the case of unaudited
statements,  to normal and recurring year-end audit adjustments).  Except as set
forth  in  the  SEC  Documents,  the  Company  has no liabilities, contingent or
otherwise,  other  than  (i)  liabilities  incurred  in  the  ordinary course of
business subsequent to the date of such SEC Documents and (ii) obligations under
contracts  and  commitments  incurred in the ordinary course of business and not
required  under generally accepted accounting principles to be reflected in such
SEC  Documents, which liabilities and obligations referred to in clauses (i) and
(ii),  individually  or  in  the  aggregate,  would  not have a Material Adverse
Effect.

     g.     Absence  of  Certain  Changes.  Except  as  disclosed  in  the  SEC
Documents,  since  December  31,  2000,  there has been no change or development
which  individually or in the aggregate has had or could have a Material Adverse
Effect.

     h.     Absence  of Litigation.  Except as disclosed in Schedule 5(h) or the
SEC  Documents,  there  is no action, suit, proceeding, inquiry or investigation
before  or  by  any  court,  public  board,  government  agency, self-regulatory
organization  or  body  pending  or, to the knowledge of the Company, threatened
against  or  affecting  the Company, or any of its subsidiaries, or any of their
directors  or  officers  in their capacities as such which would have a Material
Adverse  Effect.

     i.     Intellectual  Property.  The  Company  and  each of its subsidiaries
owns  or  is  licensed  to  use  all  patents,  patent applications, trademarks,
trademark  applications,  trade  names,  service  marks,  copyrights,  copyright
applications,  licenses,  permits,  know-how  (including trade secrets and other
unpatented  and/or unpatentable proprietary or confidential information, systems
or procedures) and other similar rights and proprietary knowledge (collectively,
"Intangibles")  necessary for the conduct of its business as now being conducted
and  as  proposed  to  be  conducted.  Neither  the  Company  nor  any  of  its
subsidiaries  has  received  written  notice  that  it  is infringing upon or in
conflict  with  any third party Intangibles.  Neither the Company nor any of its
subsidiaries  has  entered into any consent, indemnification, forbearance to sue
or  settlement  agreements with respect to the validity of the Company's or such
subsidiary's  ownership  or  right  to use its Intangibles.  The Intangibles are
valid  and enforceable, and no registration relating thereto has lapsed, expired
or  been  abandoned  or  canceled  or  is  the  subject of cancellation or other
adversarial  proceedings,  and all applications therefor are pending and in good
standing.  The Company has complied with its contractual obligations relating to
the  protection  of the Intangibles used pursuant to licenses.  To the Company's
knowledge, no person is infringing on or violating the Intangibles owned or used
by  the  Company.

     j.  Environment.  Except  as disclosed in the SEC Documents (i) there is no
environmental  liability,  nor  factors likely to give rise to any environmental
liability,  affecting  any  of  the  properties  of  the  Company  or any of its
subsidiaries  that,  individually  or  in  the  aggregate, would have a Material
Adverse  Effect  and  (ii)  neither  the Company nor any of the subsidiaries has
violated  any  environmental  law  applicable to it now or previously in effect,
other  than  such  violations  or  infringements  that,  individually  or in the
aggregate,  have  not  had  and  will  not  have  a  Material  Adverse  Effect.

     k.     Title.  The  Company  and each of its subsidiaries has good title in
fee simple to all real property and good title to all personal property owned by
it  which is material to its business, free and clear of all liens, encumbrances
and  defects  except  for  such  defects  in  title that, individually or in the
aggregate,  could  not  have  a  Material Adverse Effect.  Any real property and
facilities  held  under lease by the Company or any of its subsidiaries are held
by the Company or such subsidiary under valid, subsisting and enforceable leases
with  such  exceptions  which  have not had and will not have a Material Adverse
Effect.

     l.     Insurance.  The Company and its subsidiaries maintain such insurance
relating  to  their business, operations, assets, key-employees and officers and
directors  as  is  appropriate to their business, assets and operations, in such
amounts and against such risks as are customarily carried and insured against by
owners  of  comparable  businesses,  assets  and  operations, and such insurance
coverages  will  be  continued  in  full  force  and effect to and including the
Closing  Date  other  than  those  insurance  coverages  in respect of which the
failure to continue in full force and effect could not reasonably be expected to
have  a  Material  Adverse  Effect.

     m.     Acknowledgment Regarding the Purchasers' Purchase of the Securities.
The  Company  acknowledges and agrees that no Purchaser is acting as a financial
advisor  or is acting as a fiduciary of the Company (or in any similar capacity)
with  respect to this Agreement or the transactions contemplated hereby, and the
relationship  between  the  Company and the Purchasers is "arms length" and that
any  statement  made by any Purchaser or any of its representatives or agents in
connection  with  this Agreement and the transactions contemplated hereby is not
advice or a recommendation and is merely incidental to such Purchaser's purchase
of  Securities  and  has  not  been  relied upon by the Company, its officers or
directors  in any way.  The Company further represents to the Purchaser that the
Company's  decision  to  enter  into  this Agreement has been based solely on an
independent  evaluation  by  the  Company  and  its  representatives.

     n.     No  Brokers.  The  Company has not engaged any person to which or to
whom  brokerage  commissions,  finder's fees, financial advisory fees or similar
payments  are  or  will  become  due  in  connection  with this Agreement or the
transactions  contemplated  hereby  except for WFVK and Burnham Securities Inc.,
whose  commissions  and  fees  will  be  paid  by  the  Company.

     o.     Tax  Status.  The  Company  and each of its subsidiaries has made or
filed  all  material  federal, state and local income and all other tax returns,
reports  and  declarations  required  by any jurisdiction to which it is subject
(unless and only to the extent that the Company or the applicable subsidiary has
set  aside  on  its  books provisions adequate for the payment of all unpaid and
unreported  taxes) and has paid all taxes and other governmental assessments and
charges  that  are  material  in  amount,  shown or determined to be due on such
returns,  reports  and  declarations, except those being contested in good faith
and  has set aside on its books provisions adequate for the payment of all taxes
for  periods  subsequent  to  the  periods  to  which  such  returns, reports or
declarations apply.  There are no material unpaid taxes claimed to be due by the
taxing  authority  of  any  jurisdiction.  The Company has not executed a waiver
with  respect  to  any  statute  of  limitations  relating  to the assessment or
collection  of  any  federal,  state  or  local  tax.  None of the Company's tax
returns  have  been  or  is  being  audited  by  any  taxing  authority.

     p.     No  General  Solicitation.  Neither  the  Company  nor  any  person
participating  on  the  Company's behalf in the transactions contemplated hereby
has  conducted any "general solicitation" or "general advertising" as such terms
are  used  in  Regulation D, with respect to any of the Securities being offered
hereby.

     q.     Securities  Laws.  Neither  the  Company, nor any of its affiliates,
nor  any person acting on its or their behalf, has, directly or indirectly, made
any  offers or sales of any security or solicited any offers to buy any security
under  circumstances  that  would  require  registration of the Securities being
offered  hereby under the Securities Act or cause this offering of Securities to
be  integrated with any prior offering of securities of the Company for purposes
of  the  Securities  Act. The offer, sale and delivery of shares of Common Stock
upon  exercise of the Warrants will be exempt from the registration requirements
of  Section  5  of  the  Securities Act.  Assuming the truth and accuracy of the
representations  and warranties of the Purchasers set forth in Section 3 of this
Agreement,  the Purchasers will not be statutory underwriters within the meaning
of  Section  2(a)  11  of  the  Securities  Act.

     r.     Form S-3 Eligibility.  The Company is currently eligible to register
the resale of its Common Stock on a registration statement on Form S-3 under the
Securities  Act.  There  exist  no  facts  or  circumstances  (including without
limitation any required approvals or waivers of any circumstances that may delay
or  prevent the obtaining of accountant's consents) that would prohibit or delay
the  preparation and filing of a registration statement on Form S-3 with respect
to the Registrable Securities (as defined in the Registration Rights Agreement).

     s.     Disclosure.  All  information  relating to or concerning the Company
and  its  subsidiaries  set forth in this Agreement or provided to the Purchaser
pursuant  to  Section  3(b)  hereof  and  otherwise  in  connection  with  the
transactions  contemplated  hereby  is true and correct in all material respects
and the Company has not omitted to state any material fact necessary in order to
make  the statements made herein or therein, in light of the circumstances under
which  they were made, not misleading.  No event or circumstance has occurred or
exists  with  respect  to  the  Company or its subsidiaries or their businesses,
properties,  operations,  prospects  or financial conditions, which has not been
publicly  disclosed  but,  under  applicable  law,  rule or regulation, would be
required to be disclosed by the Company in a registration statement filed on the
date  hereof  by  the Company under the Securities Act with respect to a primary
issuance  of  the  Company's  securities.  The  Company  has  not  disclosed  or
provided,  and  without  such  Purchaser's  consent  thereto, will not hereafter
disclose  or  provide  to  any Purchaser, any information that (i) if disclosed,
would,  or  could reasonably be expected to have, a material effect on the price
of  the  Common  Stock  or (ii) according to applicable law, rule or regulation,
should  have  been  disclosed  publicly  by  the  Company but which has not been
disclosed.

5.     COVENANTS.
       ---------

     a.     Satisfaction  of  Conditions.  The  parties  shall  use  their  best
efforts  to  satisfy  in  a  timely  manner  each of the conditions set forth in
Section  6  and  Section  7  of  this  Agreement.

     b.     Form  D;  Blue  Sky  Laws.  The Company agrees to file a Form D with
respect  to  the Securities as required under Regulation D and to provide a copy
thereof  to each Purchaser promptly after such filing.  The Company shall, on or
before  the  Closing  Date,  take  such  action  as the Company shall reasonably
determine  is  necessary  to  qualify  the Securities for sale to the Purchasers
pursuant to this Agreement under applicable securities or "blue sky" laws of the
states  of  the  United  States or obtain exemption therefrom, and shall provide
evidence  of  any  such  action  so  taken  to each Purchaser on or prior to the
Closing  Date.

     c.     Reporting  Status.  So  long  as  a  Purchaser beneficially owns any
Securities  or  has  the  right  to  acquire  any  Securities  pursuant  to this
Agreement,  the  Company shall timely file all reports required to be filed with
the  SEC  pursuant to the Exchange Act, and shall not terminate its status as an
issuer  required to file reports under the Exchange Act even if the Exchange Act
or  the  rules  and  regulations  thereunder  would  permit  such  termination.

     d.     Use  of  Proceeds.  The  Company shall use the net proceeds from the
sale of the Shares and the Warrants for the purposes set forth on Schedule 5(d),
but  in  no  event  shall  the  Company  use such net proceeds to repurchase any
outstanding  securities  of  the  Company.

     e.     Expenses.   At the Closing, the Company shall reimburse WFVK for the
out-of-pocket  expenses  reasonably  incurred  by  WFVK  and  its affiliates and
advisors in connection with the negotiation, preparation, execution and delivery
of this Agreement, the Registration Rights Agreement, the Warrants and the other
agreements  to  be executed in connection herewith, including, expenses incurred
in  conducting WFVK's and its affiliates' and advisors' reasonable due diligence
and  WFVK's  and its affiliates' reasonable attorneys' fees and expenses up to a
maximum  of  $30,000.

     f.     Financial  Information.  For  a  period of three (3) years following
the  Closing,  the  Company agrees to send to each Purchaser (i) within ten days
after  the  filing  with  the SEC, to the extent not available through the SEC's
EDGAR system, a copy of its Annual Report on Form 10-K, its Quarterly Reports on
Form  10-Q, its proxy and information statements and any Current Reports on Form
8-K  and  (ii) within one day after release, copies of all press releases issued
by  the  Company  or  any  of  its  subsidiaries,  if  any.

     g.     Reservation  of Shares.  The Company has and shall at all times have
authorized  and  reserved  for  the  purpose  of issuance a sufficient number of
shares  of Common Stock to provide for the issuance of the Shares as provided in
Section  2 hereof, and the full exercise of the Warrants and the issuance of the
Warrant  Shares  in connection therewith and as otherwise required hereby and by
the  Warrants in accordance with the Registration Rights Agreement.  The Company
shall  not  reduce  the  number  of shares of Common Stock reserved for issuance
under  this  Agreement  (except  as  a  result  of  the  issuance  of the Shares
hereunder),  the  Warrants  (except  as  a result of the issuance of the Warrant
Shares  upon the exercise of the Warrants) or the Registration Rights Agreement,
without  the  consent  of  the  Purchasers.

     h.     Listing.  On  the  Closing  Date, the Company shall have applied for
the  listing  of the Shares and Warrant Shares, in each case, upon each national
securities exchange and automated quotation system, if any, upon which shares of
Common  Stock are then listed or quoted and shall maintain, so long as any other
shares  of Common Stock shall be so listed, such listing of all Shares from time
to  time  issuable  hereunder  and all Warrant Shares from time to time issuable
upon  exercise  of  the  Warrants.  The  Company  shall  use its best efforts to
include  its  shares  of Common Stock in The Nasdaq Stock Market at the earliest
practical  date  and, in any event, by the date the first registration statement
covering  the  resale  of the Shares is declared effective by the Securities and
Exchange  Commission  and  will  comply  in  all  respects  with  the  Company's
reporting,  filing and other obligations under the bylaws or rules of The Nasdaq
Stock  Market.

     i.     Additional  Financings.   The  Company agrees that during the period
beginning  on the date hereof and ending on the date which is one hundred eighty
(180)  days  following the Closing Date (the "Lock-Up Period"), the Company will
not,  without  the  prior  written consent of the Purchasers or their designees,
contract  with  any  party  to  obtain  additional  financing  (an  "Additional
Financing").  If  the  Purchasers  consent  to  such  Additional  Financing, the
Company  will  not  conduct  any  Additional Financing during the Lock-Up Period
unless  it  shall  have  first  delivered  to  the  Purchaser, at least ten (10)
Business  Days prior to the closing of such Additional Financing, written notice
describing the proposed Additional Financing, including the terms and conditions
thereof,  and providing the Purchasers and their affiliates an option during the
ten  (10)  Business Day period following delivery of such notice to purchase any
or  all  of the securities being offered in the Additional Financing on the same
terms  as  contemplated  by  such  Additional  Financing.  Such  option shall be
exercised  by  each  applicable  Purchaser  giving written notice to the Company
within  such  period  of  its agreement to buy a specified amount of the offered
securities.  Closing  of  such sale shall be contemporaneous with the closing of
the offering with investors other than the Purchasers (or, if there are no other
such  investors,  on a date specified by the Company), provided that the Company
shall  provide  written  notice  to  each applicable Purchaser at least five (5)
Business  Days prior to any such closing.  To the extent that the Purchasers, in
the  aggregate,  elect  to purchase more than all of such securities, the amount
that  each  Purchaser  shall be entitled to purchase shall be pro rated based on
the  Purchaser's  Pro  Rata  Percentage.  To  the  extent  that  the terms of an
Additional  Financing  are  changed  in  a  manner  that  is  at least partially
favorable  to  prospective investors, the Company shall notify the Purchasers of
all  changes  in  such  terms  and  the  Purchasers  shall have another ten (10)
Business Day option to purchase on the revised terms and otherwise in accordance
with  the  provisions  hereof.  The limitations referred to in this Section 5(i)
shall  not  apply  to  (i)  any transaction involving issuances of securities as
consideration  in  a  merger,  consolidation  or  acquisition  of  assets, or in
connection  with  any strategic partnership, collaboration or joint venture (the
primary  purpose  of which is not to raise capital), or as consideration for the
acquisition  of a business, product or license by the Company, (ii) the issuance
of securities pursuant to widely distributed underwritten public offering, (iii)
the issuance of securities upon exercise or conversion of the Company's options,
warrants  or  other  convertible securities outstanding as of the date hereof as
set  forth  in  Schedule  4(c)  or  issued  pursuant to this Agreement, (iv) the
issuance  of warrants or shares of Common Stock upon exercise thereof to WFVK or
its  assigns  at  the Closing in consideration of its services to the Company as
placement  agent for the financing contemplated by this Agreement, (v) the grant
of  additional  options  or  warrants, or the issuance of additional securities,
under  any  duly  authorized  Company stock option, stock purchase or restricted
stock plan for the benefit of the Company's employees, consultants or directors;
or  (vi)  any  financing  with no equity or equity-linked securities made to the
Company by a financial institution engaged in the business of lending money such
as  a  bank,  trust  company,  insurance  company or other institutional lender.

     j.     No  Integrated  Offerings.  The Company shall not make any offers or
sales of any security (other than the Securities) under circumstances that would
require registration of the Securities being offered or sold hereunder under the
Securities  Act  or  cause this offering of Securities to be integrated with any
other  offering  of  securities  by  the Company for any purposes, including for
purposes  of any shareholder approval provision applicable to the Company or its
securities.

6.     CONDITIONS  TO  THE  COMPANY'S  OBLIGATION  TO  SELL.
       ----------------------------------------------------

     The  obligation  of  the  Company  hereunder  to  issue and sell Shares and
Warrants to a Purchaser at the Closing hereunder is subject to the satisfaction,
at  or  before  the  Closing  Date, of each of the following conditions thereto;
provided,  however, that these conditions are for the Company's sole benefit and
may  be  waived  by  the  Company  at  any  time  in  its  sole  discretion.

     a.     The  applicable  Purchaser shall have executed the signature page to
this  Agreement and the Registration Rights Agreement, and delivered the same to
the  Company.

     b.     The  applicable  Purchaser  shall  have  delivered  such Purchaser's
Investment  Amount  in  accordance  with  Section  2(b)  above.

     c.     The representations and warranties of the applicable Purchaser shall
be  true  and  correct  as  of  the date when made and as of the Closing Date as
though  made  at that time (except for representations and warranties that speak
as  of  a  specific date, which representations and warranties shall be true and
correct  as  of  such  date), and the applicable Purchaser shall have performed,
satisfied  and  complied in all material respects with the covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied
with  by  the  applicable  Purchaser  at  or  prior  to  the  Closing  Date.

     d.     No  statute,  rule,  regulation,  executive  order,  decree, ruling,
injunction,  action,  proceeding  or  interpretation  shall  have  been enacted,
entered, promulgated, endorsed or adopted by any court or governmental authority
of  competent  jurisdiction or any self-regulatory organization, or the staff of
any  thereof,  having  authority  over  the  matters  contemplated  hereby which
questions  the  validity of, or challenges or prohibits the consummation of, any
of  the  transactions  contemplated  by  this  Agreement.

7.     CONDITIONS  TO  EACH  PURCHASER'S  OBLIGATION  TO  PURCHASE  SHARES  AND
       WARRANTS.
       ------------------------------------------------------------------------

     The  obligation of each Purchaser hereunder to purchase Shares and Warrants
to be purchased by it hereunder is subject to the satisfaction, at or before the
Closing  Date,  of  each  of  the  following  conditions,  provided  that  these
conditions  are  for  such  Purchaser's  sole  benefit and may be waived by such
Purchaser  at  any  time  in  such  Purchaser's  sole  discretion:

     a.     The  Company  shall  have  executed  the  signature  pages  to  this
Agreement  and  the Registration Rights Agreement, and delivered the same to the
Purchaser.

     b.     The  Company  shall  have  delivered  to the Purchaser duly executed
certificates  representing  the  number  of Shares and duly executed Warrants as
provided  in  Section  2(b)  above.

     c.     The  Shares  shall  be  authorized for quotation on The Nasdaq Stock
Market  and  trading  in  the  Common Stock or The Nasdaq Stock Market generally
shall not have been suspended or be under threat of suspension by the SEC or any
governing  body  of  The  Nasdaq  Stock  Market.

     d.     The  representations and warranties of the Company shall be true and
correct  as  of  the date when made and as of the Closing Date as though made at
that time (except for representations and warranties that speak as of a specific
date,  which representations and warranties shall be true and correct as of such
date)  and  the  Company  shall  have  performed,  satisfied and complied in all
material respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by the Company at or prior
to  the Closing Date.  The Purchaser shall have received a certificate, executed
on behalf of the Company by its Chief Financial Officer, dated as of the Closing
Date,  to  the  foregoing  effect  and  attaching true and correct copies of the
resolutions  adopted  by  the  Company's  Board  of  Directors  authorizing  the
execution, delivery and performance by the Company of its obligations under this
Agreement,  the  Warrants  and  the  Registration  Rights  Agreement.

     e.  No  statute,  rule,  regulation,  executive  order,  decree,  ruling,
injunction,  action,  proceeding  or  interpretation  shall  have  been enacted,
entered, promulgated, endorsed or adopted by any court or governmental authority
of  competent  jurisdiction or any self-regulatory organization, or the staff of
any  thereof,  having  authority  over  the  matters  contemplated  hereby which
questions  the  validity of, or challenges or prohibits the consummation of, any
of  the  transactions  contemplated  by  this  Agreement.

     f.     The  Purchaser  shall  have  received  an  opinion  of the Company's
counsel,  dated  as  of  the  Closing Date, relating to the matters set forth in
Exhibit  C  attached  hereto.

     g.     From  the  date  of  this  Agreement through the Closing Date, there
shall  not  have  occurred  any  Material  Adverse  Effect.

     h.     The  Company  shall have provided advance notice to The Nasdaq Stock
Market  of  the  issuance  of  the Shares if so required by the rules applicable
thereto.

8.     GOVERNING  LAW  MISCELLANEOUS.
       -----------------------------

     a.     Governing Law.  This Agreement shall be governed by and construed in
accordance  with  the  laws of the State of New York. Each of the parties agrees
that  service  of  process  upon  such  party  mailed by first class mail to the
address  set  forth  in  Section 8(f) shall be deemed in every respect effective
service  of  process  upon  such  party in any such suit or proceeding.  Nothing
herein  shall  affect  the  right of any Purchaser to serve process in any other
manner permitted by law. Each of the parties, agrees that a final non-appealable
judgment  in any such suit or proceeding shall be conclusive and may be enforced
in  other  jurisdictions by suit on such judgment or in any other lawful manner.

     b.     Counterparts.  This  Agreement  may  be  executed  in  two  or  more
counterparts,  all  of  which shall be considered one and the same agreement and
shall  become  effective  when  counterparts  have been signed by each party and
delivered  to the other party.  This Agreement, once executed by a party, may be
delivered  to  the  other  parties hereto by facsimile transmission of a copy of
this  Agreement bearing the signature of the party so delivering this Agreement.
In  the  event  any  signature is delivered by facsimile transmission, the party
using such means of delivery shall cause the manually executed Execution Page(s)
hereof to be physically delivered to the other party within five (5) days of the
execution  hereof.

     c.     Headings.  The  headings  of  this  Agreement are for convenience of
reference  and  shall  not  form  part of, or affect the interpretation of, this
Agreement.

     d.     Severability.  If  any  provision of this Agreement shall be invalid
or  unenforceable in any jurisdiction, such invalidity or unenforceability shall
not  affect the validity or enforceability of the remainder of this Agreement or
the  validity  or  enforceability  of  this Agreement in any other jurisdiction.

     e.     Entire  Agreement;  Amendments;  Waiver.  This  Agreement  and  the
instruments  referenced  herein  contain the entire understanding of the parties
with  respect  to  the  matters  covered  herein  and  therein  and,  except  as
specifically set forth herein or therein, neither the Company nor the Purchasers
make  any representation, warranty, covenant or undertaking with respect to such
matters.  No  provision of this Agreement may be waived or amended other than by
an  instrument  in  writing  signed  by  the  Company  and, by the Purchasers as
provided in Section 8(n) hereof.  Any waiver by the Purchasers, on the one hand,
or  the  Company,  on  the  other  hand,  of  a  breach of any provision of this
Agreement  shall  not  operate  as  or  be construed to be a waiver of any other
breach  of  such  provision  of  or  any  breach  of any other provision of this
Agreement.  The  failure  of the Purchasers, on the one hand, or the Company, on
the  other hand to insist upon strict adherence to any term of this Agreement on
one  or more occasions shall not be considered a waiver or deprive that party of
the  right  thereafter to insist upon strict adherence to that term or any other
term  of  this  Agreement.

     f.     Notices.  Any  notices  required  or permitted to be given under the
terms  of  this  Agreement shall be sent by certified or registered mail (return
receipt  requested)  or  delivered  personally  or  by  courier  or by confirmed
telecopy,  and  shall  be effective five days after being placed in the mail, if
mailed,  or  upon  receipt  or refusal of receipt, if delivered personally or by
courier or confirmed telecopy, in each case addressed to a party.  The addresses
for  such  communications  shall  be:

     If to the Company:

     Genus,  Inc.
     1139  Karlstad  Drive
     Sunnyvale,  CA  94089
     Telephone  No.:  (408)  747-7120
     Facsimile  No.:  (408)  747-7198
     Attention:  Kenneth  Schwanda

     With a copy to:

     Wilson  Sonsini  Goodrich  &  Rosati
     650  Page  Mill  Road
     Palo  Alto,  CA  94304
     Telephone  No.:  (650)  493-9300
     Facsimile  No.:   (650)  493-6811
     Attention:  Mark  Casillas,  Esq.

If  to the Purchaser, to the address set forth under the Purchaser's name on the
Execution  Page  hereto  executed  by  such  Purchaser,  with  a  copy  to:

     Wells  Fargo  Van  Kasper
     600  California  St.,  Suite  1700
     San  Francisco,  CA  94108
     Telephone  No.:  (415)  391-5600
     Facsimile  No.:  (415)  397-2744
     Attention:     Robert  L.  Quist
                    Managing  Director

Each  party  hereto may from time to time change its address or facsimile number
for notices under this Section 8 by giving at least ten (10) days' prior written
notice  of  such  changed  address  or  facsimile  number,  in  the  case of the
Purchasers  to  the  Company,  and  in  the  case  of  the Company to all of the
Purchasers.

     g.     Successors  and  Assigns.  This  Agreement shall be binding upon and
inure  to  the  benefit  of  the  parties and their successors and assigns.  The
Company  shall  not assign this Agreement or any rights or obligations hereunder
without  the  prior  written  consent  of  the  Purchasers.

     h.     Third  Party  Beneficiaries.  This  Agreement  is  intended  for the
benefit  of  the  parties  hereto  and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by  any  other  person.

     i.     Survival.  The representations and warranties of the Company and the
agreements  and  covenants  of  the  Company  shall  survive  the  Closing
notwithstanding any due diligence investigation conducted by or on behalf of the
Purchasers.  Moreover,  none  of  the representations and warranties made by the
Company  herein  shall act as a waiver of any rights or remedies a Purchaser may
have  under  applicable federal or state securities laws.  The Company agrees to
indemnify  and  hold  harmless  each  Purchaser  and  each  of  such Purchaser's
officers,  directors,  employees,  partners,  members, agents and affiliates for
loss  or  damage  relating  to  the  Securities purchased hereunder arising as a
result  of or related to any breach by the Company of any of its representations
or  covenants  set  forth  herein, including advancement of expenses as they are
incurred.

     j.     Further Assurances.  Each party 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  may  reasonably  request in order to carry out the intent and
accomplish  the  purposes  of  this  Agreement  and  the  consummation  of  the
transactions  contemplated  hereby.

     k.     Termination.  In  the  event  that  the  Closing Date shall not have
occurred  on  or  before  May 31, 2001, unless the parties agree otherwise, this
Agreement  shall  terminate  at  the  close  of  business  on  such  date.
Notwithstanding  any  termination  of this Agreement, any party not in breach of
this  Agreement  shall  preserve  all  rights  and  remedies it may have against
another  party hereto for a breach of this Agreement prior to or relating to the
termination  hereof.

     l.     Joint  Participation  in Drafting.  Each party to this Agreement has
participated in the negotiation and drafting of this Agreement, the Registration
Rights Agreement and the Warrants. As such, the language used herein and therein
shall be deemed to be the language chosen by the parties hereto to express their
mutual  intent,  and  no rule of strict construction will be applied against any
party  to  this  Agreement,  the  Registration Rights Agreement or the Warrants.
     m.     Equitable  Relief.  Each  party  acknowledges that a breach by it of
its  obligations  hereunder  will cause irreparable harm to the other parties by
vitiating  the  intent  and  purpose  of  the  transactions contemplated hereby.
Accordingly,  each party acknowledges that the remedy at law for a breach of its
obligations hereunder will be inadequate and agrees, in the event of a breach or
threatened  breach  by  such party of the provisions of this Agreement, that the
other parties shall be entitled, in addition to all other available remedies, to
an  injunction  restraining  any  breach  and  requiring  immediate issuance and
transfer, without the necessity of showing economic loss and without any bond or
other  security  being  required.

     n.     Determinations.  Except  as otherwise expressly provided herein, all
consents,  approvals  and  other  determinations  to  be  made by the Purchasers
pursuant  to  this  Agreement  and  all  waivers  and  amendments  to  or of any
provisions  in  this  Agreement  prior  to the Closing Date to be binding upon a
Purchasers  shall  be  made  by such Purchaser and except as otherwise expressly
provided  herein,  all  consents, approvals and other determinations (other than
amendments  to  the  terms  and  provisions of this Agreement) to be made by the
Purchasers  pursuant  to  this Agreement and all waivers and amendments to or of
any  provisions  in  this  Agreement  after  the  Closing  Date shall be made by
Purchasers  (excluding  Purchasers  who are affiliates of the Company) that have
invested  more  than  fifty  percent  (50%)  of the aggregate Investment Amounts
invested  by  all  Purchasers  (excluding  Purchasers  who are affiliates of the
Company).

     [REMAINDER  OF  PAGE  INTENTIONALLY  LEFT  BLANK]

<PAGE>

     IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused
this  Agreement  to  be  duly  executed  as  of  the  date  first above written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:
     [____________________________]

          By:
          Name:
          Title:
          Investment  Amount:  $_____________
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>

     IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused
this  Agreement  to  be  duly  executed  as  of  the  date  first above written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Special  Situations  Private  Equity  Fund,  L.P

          By:     /s/  Austin  Marke
          Name:          Austin  Marke
          Title:          MD
          Investment  Amount:  $1,079,668
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>

     IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused
this  Agreement  to  be  duly  executed  as  of  the  date  first above written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Special  Situations  Technology  Fund,  L.P

          By:     /s/  Austin  Marke
          Name:          Austin  Marke
          Title:      MD
          Investment  Amount:  $  719,793
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Special  Situations  Fund  III,  L.P

          By:     /s/  Austin  Marke
          Name:          Austin  Marke
          Title:          MD
          Investment  Amount:  $  2,024,418
          Residence:     __________________

          Address:

          Telephone  No.:     (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:          (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Special  Situations  Cayman  Fund,  L.P

          By:     /s/  Austin  Marke
          Name:          Austin  Marke
          Title:          MD
          Investment  Amount:  $  674,805
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     James  Gerson

          By:     /s/  James  Gerson
          Name:          James  Gerson
          Title:
          Investment  Amount:  $  111,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Mangin  Family  LP

          By:     /s/  Joe  Mangin
          Name:          Joe  Mangin
          Title:          General  Partner
          Investment  Amount:  $  106,800
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     John  P.  Rosenthal

          By:     /s/  John  P.  Rosenthal
          Name:          John  P.  Rosenthal
          Title:          Investor
          Investment  Amount:  $  222,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     HAFF  Partners  LP

          By:     /s/  Drew  Gelfenbein
          Name:          Drew  Gelfenbein
          Title:          President
          Investment  Amount:  $  152,409
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Gelfenbein  Family  LP

          By:     /s/  Drew  Gelfenbein
          Name:     Drew  Gelfenbein
          Title:     President
          Investment  Amount:  $  222,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

The  Purchaser:
Roy  R.  Neuberger

By:     /s/  Roy  R.  Neuberger
Name:          Roy  R.  Neuberger
Title:
Investment  Amount:  $  222,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Melanie  Capital

          By:     /s/  Melvin  Morse
          Name:          Melvin  Morse
          Title:
          Investment  Amount:  $  93,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Forus  Investments,  Inc.

          By:     /s/  Louis  Spear
          Name:          Louis  Spear
          Title:          President
          Investment  Amount:  $  67,500
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Richard  Lewisohn  III

          By:     /s/  Richard  Lewisohn  III
          Name:          Richard  Lewisohn  III
          Title:
          Investment  Amount:  $  33,198
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Jerome  A.  Yavitz

          By:     /s/  Jerome  A.  Yavitz
          Name:     Jerome  A.  Yavitz
          Title:
          Investment  Amount:  $  135,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Irwin  W.  Silverberg

          By:     /s/  Irwin  W.  Silverberg
          Name:          Irwin  W.  Silverberg
          Title:
          Investment  Amount:  $  103,500
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Delaware  Charter

          By:     /s/Harold  J.  Krause
          Name:          Harold  J.  Krause
          Title:
          Investment  Amount:  $  45,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Mortan  Seaman

          By:          /s/  Mortan  Seaman
          Name:          Mortan  Seaman
          Title:
          Investment  Amount:  $  45,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     Bedford  Oak  Partners,  LP

          By:          /s/  Harvey  P.  Eisen
          Name:          Harvey  P.  Eisen
          Title:
          Investment  Amount:  $  735,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     BayStar  Capital,  L.P.

          By:     /s/  Lawrence  R.  Goldfarb
          Name:          Lawrence  R.  Golfarb
          Title:          Managing  Director
          Investment  Amount:  $  375,000
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     BayStar  International,  LTD.

          By:     /s/  Lawrence  R.  Golfarb
          Name:          Lawrence  R.  Golfarb
          Title:          Managing  Director
          Investment  Amount:  $  124,998
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________

<PAGE>
IN  WITNESS  WHEREOF, the undersigned Purchaser and the Company have caused this
Agreement  to  be  duly  executed  as  of  the  date  first  above  written.

     COMPANY:

     GENUS,  INC.

     By:  /s/  William  W.  R.  Elder
     Name:     William  W.  R.  Elder
     Title:  Chairman,  President  and  CEO

     The  Purchaser:

     William  R.  Timken,  Trustee

          By:     /s/  William  R.  Timken
          Name:          William  R.  Timken
          Title:
          Investment  Amount:  $  333,246
          Residence:     __________________

          Address:

          Telephone  No.:    (    )
          Telecopy  No.:     (    )
          Attention:

          with  copies  of  all  notices  to:

          ______________________________
          ______________________________
          ______________________________
          ______________________________
          Telephone  No.:     (   )  _________
          Telecopy  No.:      (   )  _________
          Attention:  ______________________EXHIBIT 4.2

                                                                       EXHIBIT A
                                                to Securities Purchase Agreement

VOID  AFTER  5:00  P.M.,  CALIFORNIA  TIME,
ON  May  13,  2006

THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED  UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR  THE  SECURITIES  LAWS  OF  ANY  STATE  OF  THE  UNITED  STATES  OR ANY OTHER
JURISDICTION.  THE  SECURITIES  REPRESENTED HEREBY MAY NOT BE OFFERED OR SOLD IN
THE  ABSENCE  OF  AN  EFFECTIVE  REGISTRATION STATEMENT FOR THE SECURITIES UNDER
APPLICABLE  SECURITIES  LAWS  UNLESS OFFERED, SOLD OR TRANSFERRED PURSUANT TO AN
AVAILABLE  EXEMPTION  FROM  THE  REGISTRATION  REQUIREMENTS  OF  THOSE  LAWS.

Date:  May  14,  2001

                                  GENUS, INC.
                             STOCK PURCHASE WARRANT

THIS  CERTIFIES  THAT,  for value received,_____________________________, or its
registered  assigns,  is  entitled  to  purchase from GENUS, INC., a corporation
organized under the laws of the State of California (the "Company"), at any time
or  from  time  to  time  during  the  period  specified  in  Section  2 hereof,
_________________ [insert a number that is 50% of the number of Shares purchased
by the holder on the Closing Date pursuant to the Securities Purchase Agreement]
fully  paid and nonassessable shares of the Company's common stock, no par value
(the  "Common  Stock"), at an exercise price per share (the "Exercise Price") of
$3.50.  The number of shares of Common Stock purchasable hereunder (the "Warrant
Shares") and the Exercise Price are subject to adjustment as provided in Section
5  hereof.  The term "Warrants" means this Warrant and the other Warrants of the
Company  issued pursuant to that certain Securities Purchase Agreement, dated as
of May 14, 2001, by and among the Company and the other signatories thereto (the
"Securities  Purchase Agreement"). Capitalized terms used but not defined herein
shall  have  the  meanings  given  them  in  the  Securities Purchase Agreement.

     This  Warrant is subject to the following terms, provisions and conditions:

     1.     Manner  of  Exercise;  Issuance of Certificates; Payment for Shares.
Subject to the provisions hereof, including, without limitation, the limitations
contained  in Section 8 hereof, this Warrant may be exercised at any time during
the  Exercise  Period  (as  defined  below) by the holder hereof, in whole or in
part,  by  the  surrender  of  this  Warrant, together with a completed exercise
agreement in the form attached hereto (the "Exercise Agreement"), to the Company
by  5  p.m.  California  time  on  any  Business  Day at the Company's principal
executive  offices  (or  such  other  office  or agency of the Company as it may
designate by notice to the holder hereof) and upon (i) payment to the Company in
cash, by certified or official bank check or by wire transfer for the account of
the  Company,  of the applicable Exercise Price for the Warrant Shares specified
in  the  Exercise Agreement or (ii) delivery to the Company of written notice of
an  election  to effect a Cashless Exercise (as defined in Section 12(c) hereof)
for  the Warrant Shares specified in the Exercise Agreement.  The Warrant Shares
so  purchased shall be deemed to be issued to the holder hereof or such holder's
designee, 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 the completed
Exercise  Agreement  shall  have been delivered and payment shall have been made
for such shares as set forth above or, if such day is not a Business Day, on the
next succeeding Business Day.  The Warrant Shares so purchased, representing the
aggregate  number  of  shares  specified  in  the  Exercise  Agreement, shall be
delivered  to  the  holder  hereof within a reasonable time, not exceeding three
Business  Days,  after  this Warrant shall have been so exercised (the "Delivery
Period").  If  the  Company's  transfer agent is participating in the Depository
Trust Company ("DTC") Fast Automated Securities Transfer program, and so long as
the  certificates  therefor do not bear a legend and the holder is not obligated
to  return  such  certificate for the placement of a legend thereon, the Company
shall  cause its transfer agent to electronically transmit the Warrant Shares so
purchased  to  the  holder by crediting the account of the holder or its nominee
with  DTC  through  its  Deposit  Withdrawal  Agent  Commission  system  ("DTC
Transfer").  If  the  aforementioned  conditions  to  a  DTC  Transfer  are  not
satisfied,  the  Company  shall  deliver  to  the  holder  physical certificates
representing  the Warrant Shares so purchased.  Further, the holder may instruct
the  Company  to  deliver  to  the holder physical certificates representing the
Warrant  Shares  so  purchased  in  lieu of delivering such shares by way of DTC
Transfer.  Any  certificates  so delivered shall be in such denominations as may
be  requested  by  the  holder  hereof,  shall be registered in the name of such
holder  or  such other name as shall be designated by such holder and, following
the  date on which the Warrant Shares may be sold by the holder pursuant to Rule
144(k)  promulgated  under  the  Securities Act (or a successor rule), shall not
bear  any  restrictive legend.  Upon a sale of any Warrant Shares pursuant to an
effective  registration  statement,  any  restrictive legend on the certificates
representing  such  Warrant Shares shall be removed.  If this Warrant shall have
been  exercised only in part, then, unless this Warrant has expired, the Company
shall,  at its expense, at the time of delivery of such certificates, deliver to
the holder a new Warrant representing the number of shares with respect to which
this  Warrant  shall  not  then  have  been  exercised.

     2. Period of Exercise. Except as set forth in Section 3 below, this Warrant
may  be  exercised  at any time or from time to time (an "Exercise Date") during
the  period  (the "Exercise Period") beginning on (a) the date hereof and ending
(b)  at  5:00 p.m., California time, on the fifth annual anniversary of the date
of  original  issuance  hereof.

     3.     Mandatory  Exercise.  On  any  Notification Date (as defined below),
the  Company  may  request that the Purchaser exercise this Warrant in whole but
not  in  part  (the "Mandatory Exercise") within thirty calendar (30) days after
the  date  of  the  Mandatory Exercise Notice (as defined below) by delivering a
written  notice to the holder at such address as such holder shall have provided
to the Company in writing pursuant to Section 10 hereof (the "Mandatory Exercise
Notice").  The  Mandatory Exercise Notice shall set forth the Exercise Price and
the Closing Price of a share of Common Stock on each of the ten (10) consecutive
Trading Days immediately preceding the date of the Mandatory Exercise Notice and
shall  state  that  this  Warrant be exercised in conformity with this Section 3
within  thirty  (30)  calendar  days.  The last day of such thirty-day period is
hereinafter referred to as the "Automatic Mandatory Exercise Date" provided such
day  is  a  Business Day, and if not, the first Business Day thereafter shall be
considered the Automatic Mandatory Exercise Date. To the extent the holder fails
to  exercise  this Warrant by 5:00 pm California time of the Automatic Mandatory
Exercise Date, then (i) the holder shall forfeit such holder's rights, title and
interest  under  this  Warrant, (ii) this Warrant shall be deemed terminated and
(iii)  the  holder shall deliver to the Company this Warrant marked "cancelled."
Notwithstanding  the  foregoing,  no Mandatory Exercise may occur unless: (a) at
all  times  from  the Notification Date through the Automatic Mandatory Exercise
Date  a  Registration  Statement  covering  all Registrable Securities (as those
terms  are  defined  in that certain Registration Rights Agreement dated May 14,
2001  by  and  among  the  company  and  the  other  signatories  thereto  (the
"Registration  Rights  Agreement")): (i) is effective, (ii) does not require any
amendment or supplement and (iii) discloses directly or through incorporation by
reference all material facts relating to Company and the Registrable Securities,
(b)  the  Company  has no reason to believe that, during the period beginning on
the  Notification Date and ending ninety (90) days after the Automatic Mandatory
Exercise  Date (the "Initial Selling Period"), there will be any need to suspend
sales pursuant to the Registration Statement as a result of the need to amend or
supplement  the  Registration  Statement or otherwise; (c) the Company covenants
not  to  take  any  action  during the Initial Selling Period that is reasonably
likely  to  result in the suspension of sales during the Initial Selling Period;
and  (d)  the  Mandatory  Exercise  Notice contains (i) a certification from the
Company's  chief executive officer and chief financial officer as to the matters
set  forth  in  the  immediately preceding subclause (a) (as of the Notification
Date;  provided  that the Company shall immediately notify the Purchaser if such
certification  is  no  longer  true  at  any  time  on or prior to the Automatic
Mandatory Exercise Date) and subclause (b); and (ii) the covenant of the Company
set  forth  in  the  immediately  preceding subclause (c).  For purposes of this
Section  3,  "Notification Date" shall mean any Business Day during the Exercise
Period  but  after  the  Trigger  Date  (as defined below) which Business Day is
immediately  preceded  by ten (10) consecutive Trading Days on each of which the
Closing  Price for the Common Stock was greater than 150% of the Exercise Price;
and  "Trigger  Date" shall mean the date the Registration Statement covering all
Registrable  Securities  (as  those terms are defined in the Registration Rights
Agreement)  is  declared  effective  by  the Securities and Exchange Commission.

     4.     Certain Agreements of the Company.  The Company hereby covenants and
agrees  as  follows:

     (a)     Shares to be Fully Paid.  All Warrant Shares will, upon issuance in
accordance  with  the  terms  of this Warrant, be validly issued, fully paid and
nonassessable  and  free  from  all  taxes,  liens,  claims  and  encumbrances.

     (b) Reservation of Shares. During the Exercise Period, the Company shall at
all  times  have  authorized,  and  reserved  for  the  purpose of issuance upon
exercise  of  this  Warrant,  a  suf-ficient number of shares of Common Stock to
provide  for  the exercise in full of this Warrant (without giving effect to the
limitations  on  exercise  set  forth  in  Section  8(g)  hereof).

     (c)  Listing.  The Company shall use its best efforts to secure the listing
of the shares of Common Stock issuable upon exercise of or otherwise pursuant to
this  Warrant  upon  each  national  securities  exchange or automated quotation
system,  if  any,  upon  which  shares of Common Stock are then listed or become
listed  (subject  to  official notice of issuance upon exercise of this Warrant)
and  shall  maintain,  so  long  as any other shares of Common Stock shall be so
listed,  such  listing  of all shares of Common Stock from time to time issuable
upon  the  exercise  of  or  otherwise pursuant to this Warrant; and the Company
shall  so  list  on  each  national  securities  exchange or automated quotation
system, as the case may be, and shall maintain such listing of, any other shares
of  capital  stock  of  the  Company  issuable upon the exercise of or otherwise
pursuant to this Warrant if and so long as any shares of the same class shall be
listed  on  such  national  securities  exchange  or automated quotation system.

     (d)     Certain  Actions Prohibited.  The Company will not, by amendment of
its  charter or through any re-organi-zation, transfer of assets, consolidation,
mer-ger,  dissolution,  issuance  or  sale of securities, or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the terms
to be observed or performed by it hereunder, but will at all times in good faith
assist  in  the  carrying  out  of  all the provisions of this Warrant.  Without
limiting  the generality of the foregoing, the Company (i) will not increase the
par  value  of  any  shares of Common Stock receivable upon the exercise of this
Warrant  above  the  Exercise  Price then in effect, and (ii) will take all such
actions as may be necessary or appropriate in order that the Company may validly
and  legally  issue fully paid and nonassessable shares of Common Stock upon the
exercise  of  this  Warrant.

     (e)     Successors  and  Assigns.  This  Warrant  will  be binding upon any
entity succeeding to the Company by merger, consolidation, or acquisition of all
or  substantially  all  of  the  Company's  assets.

     (f)  Blue Sky Laws. The Company shall, on or before the date of issuance of
any  Warrant Shares, take such actions as the Company shall reasonably determine
are  necessary  to  qualify  the Warrant Shares for, or obtain exemption for the
Warrant  Shares for, sale to the holder of this Warrant upon the exercise hereof
under  applicable  securities  or  "blue  sky"  laws of the states of the United
States,  and shall provide evidence of any such action so taken to the holder of
this  Warrant  prior to such date; provided, however, that the Company shall not
be  required  to  qualify  as a foreign corporation or file a general consent to
service  of  process  in  any  such  jurisdiction.

     5.     Antidilution  Provisions.  During  the Exercise Period, the Exercise
Price  and  the  number  of  Warrant  Shares  issuable  upon the exercise of the
Warrants,  shall  be subject to adjustment from time to time as provided in this
Section  5.

     In  the  event that any adjustment of the Exercise Price as required herein
results in a fraction of a cent, such Exercise Price shall be rounded up or down
to  the  nearest  cent;  provided that, in no event shall the Exercise Price per
share  be  reduced  below  $.01.

     (a)     Subdivision or Combination of Common Stock.  If the Company, at any
time during the Exercise Period, subdivides (by any stock split, stock dividend,
recapitalization,  reorganization,  reclassification or otherwise) its shares of
Common Stock into a greater number of shares, then, after the date of record for
effecting  such  subdivision,  the Exercise Price in effect immediately prior to
such  subdivision  will be proportionately reduced.  If the Company, at any time
during  the Exercise Period, combines (by reverse stock split, recapitalization,
reorganization, reclassification or otherwise) its shares of Common Stock into a
smaller  number  of  shares,  then,  after the date of record for effecting such
combination,  the Exercise Price in effect immediately prior to such combination
will  be  proportionately  increased.

     (b)     Adjustment  in  Number  of  Shares.  Upon  each  adjustment  of the
Exercise  Price  pursuant  to  the  provisions  of this Section 5, the number of
shares of Common Stock issuable upon exercise of this Warrant shall be increased
or  decreased  to equal the quotient obtained by dividing (i) the product of (A)
the Exercise Price in effect immediately prior to such adjustment, multiplied by
(B)  the number of shares of Common Stock issuable upon exercise of this Warrant
immediately  prior  to  such  adjustment,  by (ii) the adjusted Exercise Price .

     (c)     Consolidation, Merger or Sale.  In case of any consolidation of the
Company with, or merger of the Company into, any other entity, or in case of any
sale  or  conveyance  of  all  or substantially all of the assets of the Company
other  than  in connection with a plan of complete liquidation of the Company at
any  time during the Exercise Period, then as a condition of such consolidation,
merger or sale or conveyance, adequate provision will be made whereby the holder
of this Warrant will have the right to acquire and receive upon exercise of this
Warrant in lieu of the shares of Common Stock immediately theretofore acquirable
upon  the  exercise  of  this Warrant, such shares of stock, securities, cash or
assets as may be issued or payable with respect to or in exchange for the number
of shares of Common Stock immediately theretofore acquirable and receivable upon
exercise  of  this  Warrant had such consolidation, merger or sale or conveyance
not  taken place.  In any such case, the Company will make appropriate provision
to insure that the provisions of this Section 5 will thereafter be applicable as
nearly  as  may  be  in relation to any shares of stock or securities thereafter
deliverable  upon the exercise of this Warrant.  The Company will not effect any
consolidation,  merger  or  sale  or conveyance unless prior to the consummation
thereof,  the  successor  entity  (if other than the Company) assumes by written
instrument  the obligations under this Warrant and the obligations to deliver to
the  holder  of  this  Warrant such shares of stock, securities or assets as, in
accordance with the foregoing provisions, the holder may be entitled to acquire.
Notwithstanding  the foregoing, in the event of any consolidation of the Company
with, or merger of the Company into, any other entity, or the sale or conveyance
of all or substantially all of the assets of the Company, at any time during the
Exercise  Period, the holder of the Warrant shall, at its option, have the right
to receive, in connection with such transaction, cash consideration equal to the
fair  value of this Warrant as determined in accordance with customary valuation
methodology  used  in  the  investment  banking  industry.

     (d)     Distribution  of Assets.  In case the Company shall declare or make
any  distribution  of  its  assets  (other  than cash) (or rights to acquire its
assets  (other  than  cash)) to holders of Common Stock as a partial liquidating
dividend,  stock repurchase, by way of return of capital or otherwise (including
any  dividend or distribution to the Company's shareholders of shares (or rights
to  acquire shares) of capital stock of a subsidiary) (a "Distribution"), at any
time  during  the  Exercise  Period, then, upon exercise of this Warrant for the
purchase  of any or all of the shares of Common Stock subject hereto, the holder
of  this Warrant shall be entitled to receive its pro-rata amount of such assets
(or  such  rights) as would have been payable to the holder had such holder been
the  holder  of  such  shares  of  Common  Stock  on  the  record  date  for the
determination  of  shareholders  entitled  to  such  Distribution.

     (e)     Issuances  or  Sales  at  less  than  Exercise  Price.

          (i)  If at any time after May 14, 2001 the Company shall issue or sell
any  shares  of  Common  Stock  (except  (A)  as  consideration  in  a  merger,
consolidation  or  acquisition  of  assets,  or in connection with any strategic
partnership, collaboration or joint venture (the primary purpose of which is not
to  raise  capital),  or  as  consideration  for  the acquisition of a business,
product  or  license  by  the  Company,  (B)  pursuant  to  widely  distributed
underwritten  public  offering, (C) upon exercise or conversion of the Company's
options,  warrants  or  other  convertible securities outstanding as of the date
hereof  as  set  forth  in Schedule 4(c) of the Securities Purchase Agreement or
issued pursuant to such Securities Purchase Agreement, (D) upon exercise thereof
to  WFVK  or  its assigns at the Closing in consideration of its services to the
Company  as  placement  agent  for  the financing contemplated by the Securities
Purchase  Agreement,  (E)  under any duly authorized Company stock option, stock
purchase  or  restricted  stock plan for the benefit of the Company's employees,
consultants  or directors), and (F) in connection with any financing made to the
Company  by  a  financial  institution engaged in the business of lending money,
such  as a bank, trust company, insurance company or other institutional lender,
for a consideration per share less than the Exercise Price in effect immediately
prior  to  such  issue  or  sale,  then  immediately upon such issue or sale the
Exercise  Price  then  in  effect  shall  be  reduced  to  a  price equal to the
consideration  per  share  received  by  the Company upon such issuance or sale.

          (ii) For purposes of this Section 5(e), in the event the Company shall
issue  any securities (except (A) as consideration in a merger, consolidation or
acquisition  of  assets,  or  in  connection  with  any  strategic  partnership,
collaboration  or  joint  venture  (the primary purpose of which is not to raise
capital),  or  as  consideration  for  the acquisition of a business, product or
license  by  the Company, (B) pursuant to widely distributed underwritten public
offering,  (C) upon exercise or conversion of the Company's options, warrants or
other  convertible  securities outstanding as of the date hereof as set forth in
Schedule  4(c)  of  the Securities Purchase Agreement or issued pursuant to such
Securities  Purchase Agreement, (D) upon exercise thereof to WFVK or its assigns
at  the  Closing  in  consideration  of its services to the Company as placement
agent  for  the financing contemplated by the Securities Purchase Agreement, (E)
under  any  duly  authorized  Company stock option, stock purchase or restricted
stock  plan  for  the  benefit  of  the  Company's  employees,  consultants  or
directors),  and  (F)  in connection with any financing made to the Company by a
financial  institution engaged in the business of lending money, such as a bank,
trust  company,  insurance company or other institutional lender, which by their
terms  are  convertible  into  or  exchangeable  for, or consist of any right or
option  to  purchase,  shares  of  Common  Stock  (whether or not such rights of
conversion,  exchange,  or  purchase  are  immediately  exercisable)  and  the
consideration  per  share  for which such shares of Common Stock are deliverable
upon  conversion,  exchange,  or  exercise  of  such  securities,  determined as
provided  in  Subsection  5(e)(iii)  below,  is  less than the Exercise Price in
effect  immediately  prior  to  the  issuance of such securities, then the total
maximum  number of shares of Common Stock issuable upon conversion, exchange, or
exercise  of  such securities shall be deemed to be outstanding and to have been
issued  for  such  consideration per share. Except as provided below, no further
adjustment of the Exercise Price shall be made pursuant to this Section upon the
actual  issue  of  such  shares  upon  conversion, exchange, or exercise of such
securities.  Upon  the  redemption  or  repurchase of any such securities or the
expiration  or  termination  of  the  right  to  convert  into, exchange for, or
exercise with respect to, such shares, the Exercise Price shall be readjusted to
such  price as would have been obtained had the adjustment in the Exercise Price
made  upon  the  issuance  of  such  securities  been made upon the basis of the
issuance of only such number of such securities as were actually converted into,
exchanged  for,  or  exercised  with  respect to, shares of Common Stock. If the
purchase  price or conversion or exchange rate provided for in any such security
shall change or a different purchase price or rate shall become effective at any
time,  then,  upon  such  change  becoming effective, the Exercise Price then in
effect  shall  be  readjusted  to such price as would have been obtained had the
adjustment made upon the issuance of such securities been made upon the basis of
(i)  the  issuance  of  only  the  number  of shares of Common Stock theretofore
actually  delivered  upon  the  conversion,  exchange,  or  exercise  of  such
securities,  and  the  total  consideration  received  therefor,  and  (ii)  the
issuance,  at  the  time  of  such  change,  of  any  such securities then still
outstanding  for  the consideration, determined on the basis of the new price or
rate,  for  which  shares  of  Common  Stock  are  deliverable  upon conversion,
exchange,  or  exercise of such securities. No readjustment provided for in this
Subsection  5(e)(ii)  shall,  when  taken  together with any other readjustments
attributable to the same securities, increase any Exercise Price by an amount in
excess  of  the  total  of  all decreases therein made prior to the date of such
readjustment pursuant to adjustments made upon issuance of or subsequent changes
with  respect  to  such  securities.

          (iii)  For  the  purposes  of any computation respecting consideration
received  pursuant  to  this  Section  5(e):

          (A)  In  the  case of the issuance of shares of Common Stock for cash,
     the consideration shall be the amount of cash received, provided that in no
     case  shall  any  deduction  be  made  for  any  commissions, discounts, or
     expenses  incurred  by  the  Company  for  any underwriting of the issue or
     otherwise  in  connection  therewith;

          (B)  In  the  case  of  the  issuance  of shares of Common Stock for a
     consideration  in whole or in part other than cash, the consideration other
     than cash shall be deemed to be the fair market value thereof as determined
     in good faith by the Board of Directors of the Company, irrespective of the
     accounting  treatment  thereof;  and

          (C)  In  the  case  of  the  issuance  of securities convertible into,
     exchangeable  for, or consisting of any right or option to purchase, shares
     of Common Stock, the aggregate consideration received for such shares shall
     be  equal  to  the  consideration  received  by  the  Company  for any such
     securities,  plus  the  additional  minimum  consideration,  if  any, to be
     received  by the Company upon the conversion, exchange, or exercise thereof
     (the  consideration  in  each  case  to be determined in the same manner as
     provided  in  (A)  and  (B)  above).

     (f)     Notice  of  Adjustment.  Upon  the  occurrence  of  any event which
requires  any adjustment of the Exercise Price, then, and in each such case, the
Company  shall  give  notice thereof to the holder of this Warrant, which notice
shall  state  the Exercise Price resulting from such adjustment and the increase
or  decrease  in  the  number  of  Warrant Shares issuable upon exercise of this
Warrant,  setting  forth  in reasonable detail the method of calculation and the
facts upon which such calculation is based.  Such calculation shall be certified
by  the  chief  financial  officer  of  the  Company.

     (g)     Minimum  Adjustment  of  the Exercise Price .  No adjustment of the
Exercise  Price shall be made in an amount of less than 1% of the Exercise Price
in  effect at the time such adjustment is otherwise required to be made, but any
such  lesser  adjustment  shall be carried forward and shall be made at the time
and  together  with  the  next  subsequent  adjustment  which, together with any
adjustments  so  carried  forward,  shall  amount  to  not  less than 1% of such
Exercise  Price.

     (h)  No  Fractional  Shares. No fractional shares of Common Stock are to be
issued  upon  the  exercise  of  this  Warrant, but the Company shall pay a cash
adjustment  in respect of any fractional share which would otherwise be issuable
in an amount equal to the same fraction of the Market Price of a share of Common
Stock  on  the  date  of  such  exercise.

     (i)  Other  Notices.  In  case  at  any  time:

          (i)  the  Company  shall  declare  any  dividend upon the Common Stock
payable  in  shares  of stock of any class or make any other distribution (other
than  dividends  or  distributions  payable  in  cash  out  of retained earnings
consistent with the Company's past practices with respect to declaring dividends
and  making  distributions)  to  the  holders  of  the  Common  Stock;

          (ii)  the Company shall offer for subscription pro rata to the holders
of the  Common  Stock  any additional shares of stock of any class or other
rights;

          (iii)  there  shall  be any capital reorganiza-tion of the Company, or
reclassification  of the Common Stock, or consolidation or merger of the Company
with  or  into,  or  sale of all or substan-tially all of its assets to, another
corporation  or  entity;  or

          (iv)  there  shall  be  a  voluntary  or  involun-tary  dissolution,
liquidation  or  winding-up  of  the  Company;

then,  in  each  such case, the Company shall give to the holder of this Warrant
(a) notice of the date or estimated date on which the books of the Company shall
close  or  a  record  shall be taken for determining the holders of Common Stock
entitled  to receive any such divi-dend, distribution, or subscription rights or
for  determining  the holders of Common Stock entitled to vote in respect of any
such reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation  or  winding-up  and  (b)  in  the  case of any such reorganization,
reclassification,  consolidation,  merger,  sale,  dissolution,  liquidation  or
winding-up,  notice  of  the  date (or, if not then known, a reasonable estimate
thereof  by the Company) when the same shall take place.  Such notice shall also
specify  the  date  on  which  the  holders of Common Stock shall be entitled to
receive such dividend, distribution, or subscription rights or to exchange their
Common  Stock  for  stock  or other securities or property deliverable upon such
reorganization,  re-classification,  consolidation,  merger,  sale, dissolution,
liquidation,  or  winding-up, as the case may be.  Such notice shall be given at
least  fifteen  (15)  days  prior  to  the  record date or the date on which the
Company's  books are closed in respect thereto.  Failure to give any such notice
or  any defect therein shall not affect the validity of the proceedings referred
to  in  clauses (i), (ii), (iii) and (iv) above.  Notwithstanding the foregoing,
the  Company  may  publicly  disclose  the  substance  of  any  notice delivered
hereunder  prior  to  delivery  of  such  notice  to the holder of this Warrant.

     (j)     Certain  Events.  If,  at  any time during the Exercise Period, any
event  occurs  of  the  type  contemplated  by the adjustment provisions of this
Section  5  but  not expressly provided for by such provisions, the Company will
give  notice of such event as provided in Section 5(e) hereof, and the Company's
Board of Directors will make an appropriate adjustment in the Exercise Price and
the number of shares of Common Stock acquirable upon exercise of this Warrant so
that  the  rights of the holder shall be neither enhanced nor diminished by such
event.

     (k)     Certain  Definitions.

          (i) "Business Day" means any day, other than a Saturday or Sunday or a
day  on  which  banking  institutions in the State of California or New York are
authorized  or  obligated  by  law,  regulation  or  executive  order  to close.

          (ii)  "Closing  Price" shall mean for the Common Stock as of any date,
the closing bid price of such security on the principal United States securities
exchange  or  trading  market  on  which  such  security  is listed or traded as
reported  by  the  Research  Service of Nasdaq Trading and Market Services (or a
comparable  reporting  service of national reputation selected by the holder and
reasonably  acceptable  to the Company if the Research Service of Nasdaq Trading
and  Market  Services is not then reporting closing bid prices of such security)
(collectively,  "NTMS"),  or  if the foregoing does not apply, the last reported
sale  price  of  such  security in the over-the-counter market on the electronic
bulletin  board  for  such security as reported by NTMS, or, if no sale price is
reported  for such security by NTMS, the average of the bid prices of any market
makers  for  such  security  as  reported  in  the "pink sheets" by the National
Quotation  Bureau,  Inc.,  in each case for such date or, if such date was not a
Trading  Day  (as  defined  below)  for such security, on the next preceding day
which  was a Trading Day.  If the Closing Price cannot be calculated for a share
of  Common  Stock  as of either of such dates on any of the foregoing bases, the
Closing  Price  of  such security on such date shall be the fair market value as
determined  by  an investment banking firm selected by the holder and reasonably
acceptable  to  the Company, with the costs of such appraisal to be borne by the
Company.  The  manner  of  determining the Closing Price of the Common Stock set
forth in the foregoing definition shall apply with respect to any other security
in  respect  of  which  a  determination  as  to  market  value  must  be  made.

     (iii)  "Common  Stock," for purposes of this Section 5, includes the Common
Stock  and  any additional class of stock of the Company having no preference as
to  dividends  or  distributions  on  liquidation,  provided  that  the  shares
purchasable  pursuant to this Warrant shall include only Common Stock in respect
of  which  this Warrant is exercisable, or shares resulting from any subdivision
or  combination  of  such  Common  Stock,  or in the case of any reorganization,
reclassification, consolidation, merger, or sale of the character referred to in
Section  5(c)  hereof, the stock or other securities or property provided for in
such  Section.

     (iv)     "Market  Price"  shall  mean,  with  respect  to  any  date  of
determination, the average Closing Price during the ten (10) Trading Days ending
on  the  Trading  Day  immediately  preceding  such  date  of  determination,
appropriately  adjusted  to  reflect  any stock dividend, stock split or similar
transaction  during either such relevant  period.  The manner of determining the
Market  Price  of  the  Common Stock set forth in the foregoing definition shall
apply  with respect to any other security in respect of which a determination as
to  market  value  must  be  made  hereunder.

     (v) "Trading Day" shall mean a Business Day on which at least 10,000 shares
of Common Stock are traded on the principal United States securities exchange or
trading  market  on which such security is listed or traded as reported by NTMS.

     6.     Issue Tax.  The issuance of certificates for Warrant Shares upon the
exercise  of  this  Warrant  shall  be made without charge to the holder of this
Warrant  or  such shares for any issuance tax or other costs in respect thereof,
provided  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  the  holder  of  this  Warrant.

     7.  No  Rights  or  Liabilities  as  a  Shareholder. This Warrant shall not
entitle  the holder hereof to any voting rights or other rights as a shareholder
of  the  Company.  No  provision  of this Warrant, in the absence of affirmative
action  by the holder hereof 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  Exercise Price or as a shareholder of the
Company,  whether  such  liability is asserted by the Company or by creditors of
the  Company.

     8.     Transfer,  Exchange,  Redemption  and  Replacement  of  Warrant.

     (a)     Restriction  on  Transfer.  This  Warrant and the rights granted to
the  holder  hereof  are transferable in whole or in part, at any one time, upon
surrender  of  this Warrant, together with a properly executed assignment in the
form  attached  hereto,  at  the  office or agency of the Company referred to in
Section  8(e) below, provided, however, that any transfer or assignment shall be
subject  to  the conditions set forth in Sections 8(f), 8(g) and 9 hereof and to
the  provisions  of Sections 4(e) and 4(f) of the Securities Purchase Agreement.
Until  due presentment for registration of transfer on the books of the Company,
the  Company  may  treat  the  registered  holder hereof as the owner and holder
hereof  for all purposes, and the Company shall not be affected by any notice to
the  con-trary.  Notwithstanding  anything to the contrary contained herein, the
registration  rights  described  in  Section  8  hereof  are  assignable only in
accordance  with  the  provisions  of  the  Registration  Rights  Agreement.

     (b)     Warrant  Exchangeable for Different Denominations.  This Warrant is
exchangeable,  upon  the  surrender hereof by the holder hereof at the office or
agency  of  the  Company  referred to in Section 8(e) below, for new Warrants of
like tenor of different denominations representing in the aggregate the right to
purchase  the number of shares of Common Stock which may be purchased hereunder,
each  of  such  new  Warrant  to  represent the right to purchase such number of
shares  as  shall  be  designated  by  the  holder  hereof  at  the time of such
surrender.

     (c)     Replacement  of  Warrant.  Upon  receipt  of  evidence  reasonably
satisfactory  to  the  Company of the loss, theft, destruction, or mutilation of
this  Warrant  and,  in  the  case of any such loss, theft, or destruction, upon
delivery  of  an indemnity agreement reason-ably satisfactory in form and amount
to  the  Company,  or,  in  the  case of any such mutilation, upon surrender and
cancellation  of  this  Warrant,  the  Company, at its expense, will execute and
deliver,  in  lieu  thereof,  a  new  Warrant  of  like  tenor.

       (d) Cancellation; Payment of Expenses. Upon the surrender of this Warrant
in  connection  with any trans-fer, exchange, or replacement as provided in this
Section  8, this Warrant shall be promptly canceled by the Company.  The Company
shall  pay  all  taxes  (other  than  securities  transfer  taxes) and all other
expenses  (other  than  legal  expenses,  if  any,  incurred  by  the  holder or
transferees)  and charges payable in connection with the preparation, execution,
and  delivery  of  Warrants  pursuant  to  this  Section  8.  The  Company shall
indemnify  and  reimburse  the holder of this Warrant for all losses and damages
arising  as  a result of or related to any breach by the Company of the terms of
this  Warrant,  including  costs and expenses (including legal fees) incurred by
such  holder  in  connection  with  the  enforcement  of  its  rights hereunder.

              (e) Warrant Register. The Company shall maintain, at its principal
executive  offices  (or  such  other  office  or agency of the Company as it may
designate by notice to the holder hereof), a register for this Warrant, in which
the  Company  shall record the name and address of the person in whose name this
Warrant  has been issued, as well as the name and address of each transferee and
each  prior  owner  of  this  Warrant.

           (f) Exercise or Transfer Without Registration. If, at the time of the
surrender of this Warrant in connection with any exercise, transfer, or exchange
of  this  Warrant,  this  Warrant  (or, in the case of any exercise, the Warrant
Shares issuable hereunder), shall not be registered under the Securities Act and
under applicable state securities or blue sky laws, the Com-pany may require, as
a  condition  of  allowing  such  exercise,  transfer, or exchange, (i) that the
holder or transferee of this Warrant, as the case may be, furnish to the Company
a  written  opinion  of  counsel  (which opinion shall be in form, substance and
scope  customary  for  opinions  of  counsel  in comparable transactions) to the
effect  that  such  exercise,  transfer,  or  exchange  may  be  made  without
registration  under  the Securities Act and under applicable state securities or
blue  sky  laws,  (ii)  that the holder or transferee execute and deliver to the
Company an investment letter in form and sub-stance reasonably acceptable to the
Company  and (iii) that the transferee be an "accredited investor" as defined in
Rule 501(a) promulgated under the Securities Act; provided that no such opinion,
letter,  or  status  as an "accredited investor" shall be required in connection
with  a  transfer  pursuant  to  Rule  144  under  the  Securities  Act.

     9.     [Reserved]

        10. Registration Rights. The initial holder of this Warrant (and certain
assignees  thereof)  are  entitled to the benefit of such registration rights in
respect  of  the  Warrant  Shares  as  are  set forth in the Registration Rights
Agreement,  including  the  right to assign such rights to certain assignees, as
set  forth  therein.

     11.  Notices. Any notices required or permitted to be given under the terms
of  this  Warrant  shall be sent by certified or registered mail (return receipt
requested)  or  delivered personally or by courier or by confirmed telecopy, and
shall  be effective five days after being placed in the mail, if mailed, or upon
receipt  or  refusal  of  receipt,  if delivered personally or by courier, or by
confirmed  telecopy,  in  each case addressed to a party. The addresses for such
communications  shall  be:

     If  to  the  Company:

Genus,  Inc.
1139  Karlstad  Drive
Sunnyvale,  CA  94089
Telephone  No.:  (408)  747-7120
Facsimile  No.:  (408)  747-7198
Attention:  Mr.  Kenneth  Schwanda

With  a  copy  to:

Wilson  Sonsini  Goodrich  &  Rosati
650  Page  Mill  Road
Palo  Alto,  CA  94304
Telephone  No.:  (650)  493-9300
Facsimile  No.:   (650)  493-6811
Attention:  Mark  Casillas,  Esq.

If  to the holder, at such address as such holder shall have provided in writing
to  the  Company,  or  at  such other address as such holder furnishes by notice
given  in  accordance with this Section 10, and, for any notice under Section 3,
with  a  copy  to:

Wells  Fargo  Van  Kasper
600  California  St.,  Suite  1700
San  Francisco,  CA  94108
Telephone  No.:  (415)  391-5600
Facsimile  No.:  (415)  397-2744
Attention:     Robert  L.  Quist
              Managing  Director

     12.     Governing  Law.  This Warrant shall be governed by and construed in
accordance  with  the laws of the State of New York. Each of the Company and the
holder  further  agrees  that  service of process upon the Company or the holder
mailed  by  certified  or registered mail to the address set forth in Section 10
shall  be  deemed in every respect effective service of process upon the Company
or  the  holder in any such suit or proceeding.  Nothing herein shall affect the
holder's  or  the Company's right to serve process in any other manner permitted
by  law.  Each  of the Company and the holder agrees that a final non-appealable
judgment  in any such suit or proceeding shall be conclusive and may be enforced
in  other  jurisdictions by suit on such judgment or in any other lawful manner.

     13.     Limitations  on  Holder's Right to Exercise. In the event that upon
either  (a)  the  surrender  of this Warrant, together with a completed Exercise
Agreement,  or  (b)  the  delivery of the Mandatory Exercise Notice, the Company
would  be  obligated  to  issue  an amount of shares of Common Stock which, when
aggregated with all shares of Common Stock issued upon exercise of all Warrants,
would  exceed  19.99% of the number of shares of Common Stock outstanding on May
14,  2001 (such amount to be proportionately and equitably adjusted from time to
time  in  the  event  of  stock  dividends,  subdivisions,  combinations,
reclassifications,  capital  reorganizations  and similar events relating to the
Common  Stock) (the "Exchange Cap"), and such issuance would constitute a breach
of  the  Company's  obligations under the rules or regulations of Nasdaq as they
apply  to the Company, or any other principal securities exchange or market upon
which the Common Stock is or becomes traded (the "Cap Regulations"), the Company
shall not be obligated to issue any such shares of Common Stock in excess of the
Exchange  Cap. Instead, the Company shall immediately give notice of these facts
to all holders of outstanding Warrants and shall, within twenty (20) days of the
occurrence  of  either  (a)  or  (b) above, commence taking all steps reasonably
necessary  to  be in a position to issue shares pursuant to the exercise of this
Warrant  without  violating  the Cap Regulations, which steps shall include (but
not  be  limited  to)  (i)  the  immediate  preparation  of  all necessary proxy
solicitation  materials  for a meeting of the shareholders; (ii) best efforts to
obtain  a waiver from the Cap Regulations for the issuances hereunder; and (iii)
the  filing of such preliminary proxy solicitation materials with the Securities
and  Exchange  Commission  within such twenty (20) day period. In the event that
shareholder  approval  is  required for the Company to be in a position to issue
any  shares  pursuant to the exercise of this Warrant, the Company shall use its
best  efforts  to obtain such approval at the earliest practical date, including
without  limitation  using its best efforts to cause its management and board of
directors  to  vote  shares  that they beneficially own, and to recommend to the
Company's  other  shareholders  to  vote,  in  favor  of  such  approval.

     14.     Miscellaneous.

     (a)     Amendments.  Except  as  provided  in  Section  8(g)  hereof,  this
Warrant and any provision hereof may only be amended by an instrument in writing
signed  by  the  Company  and  the  holder  hereof.

     (b) Descriptive Headings. The descriptive head-ings of the several Sections
of  this  Warrant  are  in-serted  for purposes of reference only, and shall not
affect  the  meaning  or  construction  of  any  of  the  provisions  hereof.

     (c)  Cashless  Exercise.  This Warrant may be exercised at any time or from
time  to  time during the Exercise Period, by presentation and surrender of this
Warrant  to the Company at its principal executive offices with a written notice
of the holder's intention to effect a cashless exercise, including a calculation
of  the  number  of  shares  of  Common Stock to be issued upon such exercise in
accordance  with  the  terms  hereof (a "Cashless Exercise" ). In the event of a
Cashless Exercise in lieu of paying the Exercise Price in cash, the holder shall
surrender  this  Warrant for that number of shares of Common Stock determined by
multiplying  (i)  the  number  of  Warrant Shares to which it would otherwise be
entitled  by  (ii)  a  fraction,  the numerator of which shall be the difference
between  the  then  current  Market  Price per share of the Common Stock and the
Exercise Price, and the denominator of which shall be the Market Price per share
of  Common  Stock.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

<PAGE>
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly
authorized  officer.

GENUS,  INC.

     By:  _________________________________
     Name:
     Title:

<PAGE>

                           FORM OF EXERCISE AGREEMENT

         (To be Executed by the Holder in order to Exercise the Warrant)

To:  Genus,  Inc.
     1139  Karlstad  Drive
     Sunnyvale,  CA  94089
     Attention:  ________________

      The  undersigned  hereby  irrevocably  exercises  the  right  to  purchase
_____________ shares of the Common Stock of GENUS, INC., a corporation organized
under  the  laws  of  the  State  of  California  (the  "Company"),  and either:

     tenders  herewith  payment  of  the  Exercise  Price in full, in the amount
     of  $_____________, in cash, by certified or official bank check or by wire
     transfer  for  the  account  of  the  Company;  or

     elects  pursuant  to  Section  12(c)  of  the  Warrant  to  convert  such
     Warrant  into  Common  Stock  on  a  cashless  exercise  basis.

     The undersigned agrees not to offer, sell, transfer or otherwise dispose of
any Common Stock obtained on exercise of the Warrant, except under circumstances
that  will  not result in a violation of the Securities Act of 1933, as amended,
or  any  state  securities  laws.

     The  undersigned  requests  that  the  Company  cause its transfer agent to
     electronically transmit the Common Stock issuable pursuant to this Exercise
     Agreement  to  the  account  of  the  undersigned  or its nominee (which is
     _________________) with DTC through its Deposit Withdrawal Agent Commission
     System  ("DTC  Transfer").

     In  lieu  of  receiving  the  shares  of  Common Stock issuable pursuant to
     this  Exercise  Agreement  by  way  of DTC Transfer, the undersigned hereby
     requests  that the Company cause its transfer agent to issue and deliver to
     the  undersigned  physical  certificates representing such shares of Common
     Stock.

     The  undersigned  requests  that  a  Warrant  representing  any unexercised
portion hereof be issued, pursuant to the Warrant, in the name of the Holder and
delivered  to  the  undersigned  at  the  address  set  forth  below:

Dated:_________________     _____________________________________
                            Signature  of  Holder

                            _____________________________________
                            Name  of  Holder  (Print)
                            Address:
                            _____________________________________
                            _____________________________________
                            _____________________________________
<PAGE>

                               FORM OF ASSIGNMENT

     FOR  VALUE  RECEIVED,  the undersigned hereby sells, assigns, and transfers
all  the  rights  of the undersigned under the attached Warrant, with respect to
the  number  of  shares of Common Stock covered thereby issuable pursuant to the
attached  Warrant  set  forth  hereinbelow,  to:

Name  of  Assignee               Address                    No  of  Shares

, and hereby irrevocably constitutes and appoints ___________________________ as
agent  and  attorney-in-fact  to  transfer  said  Warrant  on  the  books of the
within-named  corporation,  with  full  power  of  substitution in the premises.

Dated:  _____________________,  ____

In  the  presence  of

__________________

                             Name:  ____________________________

                             Signature:  _______________________
                             Title  of  Signing  Officer  or  Agent  (if  any):
                                      ________________________
                            Address:  ________________________
                                      ________________________

                              Note:  The  above  signature  should  correspond
                         exactly  with  the  name  on  the  face  of  the within
                         Warrant.

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