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                                                                   Exhibit 10.18

                               AMENDMENT AGREEMENT

         Reference is made to that letter agreement dated May 1, 2002 (the
"Agreement") by and between MicroIslet, Inc., a Nevada corporation (the
"Company"), and William G. Kachioff ("Kachioff"), whereby Kachioff was offered
and accepted the position of Vice President, Finance and Chief Financial Officer
of the Company.

         WHEREAS, the parties wish to amend certain provisions of the Agreement
as described herein.

         NOW, THEREFORE, in consideration of the mutual promises set forth in
this Amendment, and for other valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties, intending to be
legally bound, hereby agree as follows:

         1. AMENDMENT AND RESTATEMENT OF SECTION 2.1. Section 2.1 of the
Agreement is hereby amended and restated in its entirety to read as follows:

                  2.1 WITHOUT CAUSE. If your employment by the Company (or its
successor following a Change of Control) is involuntarily terminated without
Cause (or if you voluntarily terminate your employment for Good Reason), then
upon your furnishing to the Company an executed waiver and release of claims you
will be entitled to the following:

                  o    The Company shall pay to you, in addition to earned
                       compensation, unused PTO and reimbursable expenses
                       through the date of termination, an amount equal to six
                       months base Salary (the "Severance").

                  o    You will be provided twelve months within which you may
                       exercise that portion of your Options and any additional
                       stock options granted by the Company that are vested at
                       the date of termination. All remaining Options will be
                       terminated and there will be no further vesting, unless
                       the Board of Directors determines to continue your
                       services as a consultant, and in connection therewith, to
                       continue the term and vesting of your options. In the
                       event of a Change of Control, you agree that the Company
                       may, but shall not be required to, immediately purchase
                       your Options at the difference between recognized market
                       value of the shares and the exercise price.

o                     In the event that you elect continued health coverage
                      under COBRA, the Company will reimburse you for the same
                      portion of your health insurance premium that it paid
                      during your employment up until the earlier of either (a)
                      twelve (12) months from the date of termination, or (b)
                      the date on which you begin full-time employment with
                      another company or business entity. You will be
                      responsible for the balance of the COBRA health insurance
                      premium.

         2. AMENDMENT AND RESTATEMENT OF SECTION 2.4. Section 2.4 of the
Agreement is hereby amended and restated in its entirety to read as follows:



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                  2.4 DEATH OR DISABILITY. The Company will maintain travel
and/or life insurance that cover death or disability on Company business, and
will include you under its protection. In the event that your employment
terminates due to death or disability, the vesting of the shares of common stock
of the Company underlying the Options will cease and you or your Estate will be
able to exercise the vested portion of the Options for a period not to exceed
six (6) months following the last date of employment with the Company. In the
event of a Change of Control, you and your Estate agree that the Company can
elect to immediately purchase your Options at the recognized market value of the
shares.

         3. DEFINED TERMS. Except as otherwise defined herein, all capitalized
terms used herein shall have the respective meanings ascribed to them in the
Agreement.

         4. RATIFICATION. The Agreement, as hereby amended, is ratified and
confirmed as being in full force and effect.

         5. GOVERNING LAW. This Amendment shall be interpreted and enforced
under the laws of the State of California.

         6. ENTIRE AGREEMENT. The Agreement, as amended by this Amendment
Agreement, contains the entire agreement between the parties with respect to the
subject matter hereof and thereof and supersedes all prior agreements and
understandings, oral or written, with respect to such matters.

         7. COUNTERPARTS; FACSIMILE SIGNATURES. This Amendment may be executed
in counterparts, all of which together shall constitute a single original.
Facsimile signatures shall be deemed originals for all purposes.

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         IN WITNESS WHEREOF, the undersigned have executed this AMENDMENT
AGREEMENT as of January 30, 2004.



MICROISLET, INC., a Nevada corporation


By: /s/ John F. Steel IV                     /s/ William G. Kachioff
    ----------------------------------       -----------------------------------
    John F. Steel IV                         William G. Kachioff
    Chairman and Chief Executive Officer



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