| Third Amendment to theFebruary 14, 2003 Development and License Agreement Between The Gillette Company and PalomarMedical Technologies, Inc. (the “Agreement”) 
**Whereas**, pursuant to theAgreement, the parties are engaged in a collaboration for the development andcommercialization of light-based, consumer products and systems for personal use forfemale hair management; and 

**Whereas**, the parties desire tomodify certain provisions of the Agreement. 

**Now, Therefore,**inconsideration of the foregoing premises, the mutual promises and covenants of the partiescontained herein, and other good and valuable consideration, the receipt and sufficiencyof which is hereby acknowledged, the parties hereto, intending to be legally bound, dohereby agree as follows effective this 31 day of October 2005: 

1.              Article I, Paragraph 1.4 (d) of the Agreement is hereby replaced in its entirety          by the following language: 

(d)              Resolution of Disputes Arising Among the R&D Committee. Issues coming          before the R&D Committee that require action, approval or resolution and for          which the R&D Committee is unable to reach consensus as provided in Section          1.4(c) on a mutually acceptable action, approval or resolution, shall be          resolved by the R&D Committee Chair, provided, however, that          at the request of the Palomar R&D Committee Leader, made in writing and sent          to the Gillette R&D Committee Leader within thirty (30) days of a final          resolution of any dispute by the R&D Committee Chair, a meeting shall be          held between the Chief Executive Officer of Palomar and the Vice President          Technical Product Line Strategy, Global Technical & Manufacturing of The          Gillette Company or such officer as shall be designated by Gillette, who shall          attempt in good faith to negotiate a resolution (subject to Board of Directors          or equivalent approval, where applicable). In the event of any such escalation          of a dispute, Gillette shall retain the final right of decision, except that in          case of any disputed matter, the resolution of which by Gillette would result in          (i) a significant delay in the timetable for the development or Regulatory          Approval of the First Female Product, or (ii) an increase in the costs relating          to the development or Regulatory Approval of the First Female Product, such          change shall require the mutual written consent of both parties unless, with          respect to clause (ii) only (and not clause (i)), Gillette agrees to          bear one hundred percent (100%) of such additional costs. This          Section 1.4(d) shall not apply to the procedure established by the parties          pursuant to Section 8.2(a). 

2.     ** 

3.     ** 

**Omitted pursuant to request forconfidential treatment by  Palomar Medical Technologies, Inc. and filed separately withthe SEC.  

4.              Article VI, Paragraph 6.1 (g) of the Agreement is hereby replaced in its          entirety by the following language: 

(g)     AnnualExclusivity Collaboration           Payments. As further reimbursement to Palomar forits development and           disclosure of Palomar Technology as described in Section 6.1(e)(i)and in partial consideration of the exclusivity granted by Palomar to Gillette pursuantto ARTICLE IV and ARTICLE V, Gillette shall pay Palomar the Annual ExclusivityCollaboration Payments (as defined below) set forth in this Section 6.1(g). Subjectto ARTICLE X, within thirty (30) days after the first anniversary of the SecondDevelopment Completion Payment Date (such anniversary, the “Exclusivity Payment Date”),and thereafter within thirty (30) days after each anniversary of the Exclusivity PaymentDate, Gillette shall pay to Palomar ten million dollars (US $10,000,000) (each, an “AnnualExclusivity Collaboration Payment”). For the twelve-month period commencing on thefirst anniversary of the Exclusivity Payment Date and any future such anniversary of theExclusivity Payment Date, as the case may be, and ending twelve months thereafter (eachtwelve month period, an “Annual Exclusivity Collaboration Period”), the AnnualExclusivity Collaboration Payment paid during the first thirty (30) days of thecorresponding Annual Exclusivity Collaboration Period shall be (A) fully creditableagainst any and all TTPs or royalties owed by Gillette to Palomar for Net Sales duringthe corresponding Annual Exclusivity Collaboration Period, and (B) payable only onceirrespective of the number of Female Products that are developed or commercialized by theparties pursuant to this Agreement; provided, however, that in the eventthat Gillette elects pursuant to Section 10.2 to terminate the Exclusivity Period,from and after such termination date no Annual Exclusivity Collaboration Payments shallbe payable by Gillette to Palomar. For avoidance of doubt, any credits, offsets or otherreductions available under this Agreement for Gillette to credit against TTPs androyalties owed by Gillette to Palomar (taking into account Section 6.6(b)) shall notbe used to reduce any Annual Exclusivity Collaboration Payments.  
PALOMAR MEDICAL TECHNOLOGIES, INC. /s/ Joseph P. Caruso      Name: Joseph P. CarusoTitle:  CEOTHE GILLETTE COMPANY /s/ Carol S. Fischman      Name: Carol S. FischmanTitle: Deputy General Counsel |
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