Document:

Exhibit 10.1

                                                                  EXECUTION FORM

                               PURCHASE AGREEMENT

         THIS PURCHASE AGREEMENT (this "Agreement"),  dated as of July 23, 2003,
between Diomed, Inc. (the "Purchaser"),  a Delaware corporation, and Robert Min,
M.D. (the "Seller"). Capitalized terms used in this Agreement without definition
shall have the respective meanings given them in Article I.

         WHEREAS,  the Seller is one of the named  inventors of U.S.  Patent No.
6,398,777 and the other and the other Patents;

         WHEREAS,  the  Seller  has  heretofore  licensed  the  Patents  to  the
Purchaser under the EVLT Marketing and Promotion  Agreement (the "EVLT Promotion
Agreement"), dated as of August 29, 2001, by and among the Purchaser, the Seller
and Endovenous Laser Associates, L.L.C. (the "LLC"); and

         WHEREAS,  the Seller now wishes to sell and assign to the Purchaser all
of the Seller's  right title and interest in and to the Patents on the terms and
conditions of this Agreement  pursuant to a written  instrument (the "Assignment
of Patents") and the Amended and Restated EVLT Promotion  Agreement  dated as of
the date hereof by and among the Purchaser, the Seller and the LLC (the "Amended
EVLT Promotion Agreement").

         NOW,  THEREFORE,  in consideration of the mutual terms,  conditions and
other   agreements   set  forth   herein,   and  for  other  good  and  valuable
consideration,  the receipt and sufficiency of which is hereby acknowledged, the
Purchaser and the Seller hereby agree as follows:

                                   ARTICLE I
                                   DEFINITIONS

         1.1 "Affiliate" of any company means any corporation which, directly or
indirectly,  controls or is controlled by, or is under direct or indirect common
control with, such company;  and for the purposes of this  definition  "control"
(including "control by" and "under common control with") as used with respect to
any corporation or company,  shall mean the possession,  directly or indirectly,
of the power to direct or cause the direction of the  management and policies of
such  corporation  or  company,  through the  ownership  of more than 50% of the
voting shares.

         1.2 "Amended EVLT Promotion Agreement" has the meaning set forth in the
third recital.

         1.3  "Ancillary  Agreement"  means any of the  Amended  EVLT  Promotion
Agreement, the Patents Assignment and the Stock Option Agreement.

         1.4  "Assignment  of  Patents"  has the  meaning set forth in the third
recital.

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         1.5 "Calendar Quarter" means any of the respective  three-month periods
occurring  during the Variable  Payment Term ending March 31, June 30, September
30, or December 31 in any year.

         1.6 "Cash Portion" has the meaning set forth in Section 2.2.

         1.7 "Closing" has the meaning set forth in Section 2.4

         1.8 "Closing Date" has the meaning set forth in Section 2.4.

         1.9 "Common Stock" has the meaning set forth in Section 2.2.

         1.10  "Effective  Date" shall mean the date of the  Agreement set forth
above.

         1.11 "EVLT  Fibers"  shall mean optical  fibers  manufactured  and sold
independent of EVLT Kits by Diomed utilizing  unique fiber design  components of
the fiber described in patent  application known as U.S. Patent  Application No.
85.70.75122  dated June 16, 2001, and any letters patent issued upon said patent
application.

         1.12 "EVLT Kits" shall mean disposable accessories packaged as a single
unit  containing  at  least  two or more of the  following:  an  optical  fiber,
percutaneous needle, guide wire,  introducer sheath and/or other components that
may be  included  as packaged  accessories,  sold for the  purpose of  providing
endovenous  laser treatment using the  Technology;  PROVIDED,  that sales of raw
optical  fiber not sold in EVLT Kits  shall not be  included  in the term  "EVLT
Kits."

         1.13 "EVLT  Lasers"  shall mean the 15 watt,  810nm  Diomed  Diode EVLT
Laser,  or any  equivalent  system  developed or  substituted  in the future for
Licensee's  endovenous laser treatment (EVLT(TM)) products using the Technology,
the  unauthorized use of which would infringe any of the Patents (whether or not
any of the Patents are in effect in the  jurisdiction in which the sale occurs);
PROVIDED, that replacement parts or services for EVLT Lasers (including extended
warranties) shall not be deemed to be "EVLT Lasers."

         1.14 "EVLT Promotion Agreement" has the meaning set forth in the second
recital.

         1.15 "Equity Financing" has the meaning set forth in Section 2.2.

         1.16 "Improvement" shall mean any improvement,  invention, enhancement,
development,  modification or variation, whether or not patentable, in or to the
Technology,  which is  developed  by  Seller,  whether  now  known to  Seller or
developed by Seller after the Closing Date.

         1.17  "Know-how"   shall  have  its  usual  meaning  and  includes  any
scientific and business information, test results, data, studies,  formulations,
formulation techniques,  delivery methods,  application techniques, and the like
which are not generally known by others,  and which provide the possessor with a
competitive advantage.

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         1.18 "LLC" has the meaning set forth in the second recital.

         1.19  "Licensee"  shall mean any person or entity  that  licenses  from
Purchaser  or any of  Purchaser's  Affiliates  any of the rights in the  Patents
granted to the Purchaser by the Seller under this  Agreement and the  Assignment
of Patents.

         1.20 "Net Sales"  shall mean the actual gross  receipts  derived by the
Purchaser, its Successors,  and Affiliates at any time, but not Licensees,  from
the sale or lease or other  transfer of EVLT  Lasers,  EVLT Kits and EVLT Fibers
after the Closing to any person other than any Affiliate of the Purchaser or the
Seller, the LLC or any Affiliate of the Seller or the LLC, less, in each case:

              (a) transportation and insurance charges;

              (b) allowances actually paid and granted;

              (c) trade,  quantity,  cash,  promotional  or other  discounts and
brokers'  or  agents  commissions,  if any  allowed  and  paid by  Purchaser  to
independent parties in arms-length transactions;

              (d)  credits or  allowances  made or given on account of  rejects,
returns or retroactive price reductions;

              (e) any tax or  governmental  charge on the sale,  transportation,
use, or delivery of products paid by the  Purchaser  and not recovered  from the
purchaser;

              (f) sales commissions  payable by the Purchaser to its independent
and direct sales representatives arising from the sale of EVLT Lasers, EVLT Kits
and/or EVLT Fibers; and

              (g) for the avoidance of doubt, sales or transfers of EVLT Lasers,
EVLT Fibers  and/or EVLT Kits to  potential  customers or to  independent  sales
representatives  for demonstration  purposes shall not be deemed to generate Net
Sales.

         1.21 "OEM Sale" shall mean any sale of EVLT Lasers,  EVLT Fibers and/or
EVLT Kits by the  Purchaser  to a purchaser  under an  agreement  where the EVLT
Lasers,  EVLT Fibers and/or EVLT Kits are delivered without the Purchaser's logo
and the purchaser has the right to separately brand the EVLT Lasers, EVLT Fibers
and/or EVLT Kits under the purchaser's own name.

         1.22  "Patents"  shall  mean U.S.  Patent No.  6,389,777  and the other
Patents  listed  on  Schedule  I,  both  foreign  and  domestic,  as well as all
continuations, continuations-in-part,  divisionals, reexaminations, reissues and
extensions thereof.

         1.23 "Pay-out Amount" has the meaning set forth in Section 3.11(b).

         1.24 "Pay-out Notice" has the meaning set forth in Section 3.11(b).

         1.25 "Purchaser" has the meaning set forth in the preamble.

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         1.26 "Quarter"  shall mean each of the  three-month  periods  occurring
during the Variable  Payment Term and ending on March 31, June 30,  September 30
and December 31; PROVIDED,  that if the Closing Date occurs on a date other than
the first day of a Quarter,  the initial Quarter shall be the period  commencing
on the  Closing  Date and  ending  on the last day of the  Quarter  in which the
Closing Date occurs.

         1.27 "Seller" has the meaning set forth in the preamble.

         1.28 "Stock  Incentive  Plan" means the 2003 Omnibus  Incentive Plan of
Diomed Holdings, Inc., as amended from time to time.

         1.29 "Stock Option Agreement" has the meaning set forth in Section 2.2.

         1.30  "Technology"  shall  mean  all  intellectual  property  including
Patents,  Know-how,  and  copyrights  owned  or  licensed  to or to be  owned or
licensed by the Seller which  pertain to  discoveries  and  inventions  or other
developments  pertaining  to the  Endovenous  EVLT Laser Device and Treatment of
Varicose Veins.

         1.31 "Total of Payments"  means,  determined as of any date, the sum of
(i) the Cash  Portion,  (ii) the Stock  Options,  valued as of the Closing  date
applying the Black-Scholes option valuation method (or other comparable method),
(iii) the Variable  Payments paid to the Seller as of the date of  determination
and (iv) all amounts, if any, paid to the Seller as of the date of determination
(whether by the Purchaser,  Purchaser's  Affiliates or any third party) pursuant
to Section 5.4(d).

         1.32  "United  States"  shall mean the  United  States of  America,  it
commonwealths and possessions.

         1.33  "Variable  Payment Term" shall mean the period  commencing on the
Closing  Date  and  ending  on the  effective  date of the  termination  of this
Agreement pursuant to Section 7.2.

         1.34 "Variable Payments" has the meaning set forth in Article III.

                                   ARTICLE II
                                PURCHASE AND SALE

         2.1  PURCHASE  AND  SALE.  (a)  Upon  the  terms  and  subject  to  the
satisfaction of the conditions  contained in this Agreement,  at the Closing the
Seller will sell, assign, convey, transfer and deliver to the Purchaser, and the
Purchaser  will  purchase  and acquire  from the  Seller,  free and clear of all
Liens,  all of the  Seller's  right,  title  and  interest  in, to and under the
Patents.

              (b) The  assignment  of the Patents  pursuant to this  Section 2.1
includes any and all  Improvements  that are extant as of the Closing Date,  and
any and all  Improvements  which the Seller may develop  after the Closing  Date
during the Variable Payment Term.

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         2.2 PURCHASE  PRICE.  The purchase price (the "Purchase  Price") of the
Purchased  Assets  shall be (a)  $500,000 in cash (the "Cash  Portion"),  (b) an
agreement (the "Stock Option  Agreement"),  substantially in the form of EXHIBIT
A, granting to the Seller  non-qualified stock options to purchase up to 800,000
shares of Common  Stock,  par value  $.001 per share (the  "Common  Stock"),  of
Diomed  Holdings,  Inc.  ("Holdings"),  a  Delaware  corporation  and the parent
company of the Purchaser (the "Stock Options") granted under the Stock Incentive
Plan of Holdings and (c) the  Variable  Payments to be paid from time to time by
Purchaser  to Seller as set forth in Article  III.  The Stock  Options  shall be
exercisable  for a period of ten (10) years  after the date of grant,  and shall
have an  exercise  price per share of Common  Stock  equal to the  lesser of the
following:

                           (i) $0.32 (that being the per share  closing price of
                  the Common  Stock on the American  Stock  Exchange on June 11,
                  2003);

                           (ii) the  closing  price of the  Common  Stock on the
                  American   Stock  Exchange  on  the  Effective  Date  of  this
                  Agreement;

                           (iii) the  closing  price of the  Common  Sock on the
                  American Stock Exchange on the Closing Date; and

                           (iii)  the  purchase  price of the  shares  of Common
                  Stock (or securities  constituting  common stock  equivalents,
                  expressed on an  as-converted  into Common Stock basis) issued
                  by Holdings in an equity financing  transaction,  which may be
                  comprised  of one  or a  series  of  issuances,  resulting  in
                  aggregate   gross  proceeds  to  Holdings  of  not  less  than
                  $8,000,000  (the  "Equity  Financing"),  to occur prior to the
                  Closing.

         2.3 CLOSING DELIVERIES. At the Closing:

              (a) The Purchaser  shall pay the Cash Portion to the Purchaser and
shall  deliver to the  Purchaser  an executed  counterpart  of the Stock  Option
Agreement in the form of EXHIBIT A.

              (b) The Seller shall sell and deliver to the Purchaser an executed
counterpart  and the Stock Option  Agreement and of the Assignment of Patents in
the form of EXHIBIT B.

              (c) The  Purchaser  and the  Seller  and the LLC shall  deliver an
executed  counterpart  of the Amended  EVLT  Promotion  Agreement in the form of
EXHIBIT C.

         2.4 CLOSING  DATE.  The  consummation  of the  purchase and sale of the
Patents  (the  "Closing")  shall be held at 10:00  a.m.  at the  offices  of the
Purchaser's counsel, McGuireWoods LLP, 9 West 57th Street, Suite 1620, New York,
New York 10019,  on the business day immediately  after the Equity  Financing is
consummated,  subject to satisfaction of the conditions set forth in Section 2.7
(the "Closing Date"), but in no event later than September 15, 2003.

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         2.5  REPRESENTATIONS  AND  WARRANTIES  OF THE  SELLER.  To  induce  the
Purchaser to enter into this Agreement,  to purchase the Purchased Assets and to
perform its other  obligations  under this Agreement,  the Seller  represent and
warrant to the Purchaser as follows:

              (a) The  Seller  has the full  legal  right,  capacity  and  power
required to enter into,  execute and deliver this  Agreement and the each of the
Ancillary  Agreements to which he is a party and to perform fully his respective
obligations hereunder and thereunder.

              (b) Neither the execution and delivery of this  Agreement and each
of the Ancillary  Agreements by the Seller nor the  performance by the Seller of
the  transactions  contemplated  hereby or thereby will  violate,  result in the
creation  or  imposition  of any Lien in or upon any of the  Patents  under  any
mortgage,  indenture,  deed of trust, lease, contract, loan or credit agreement,
license or other instrument to which the Seller is a party or by which it or any
the Patents may be bound or affected.

              (c) The Assignment of Patents is a valid and binding obligation of
the Seller,  enforceable in accordance with its terms, and will effectively vest
in the Purchaser good, valid and marketable  title to all of Seller's  undivided
interest in the Patents as of the respective  issuance  dates thereof,  free and
clear of all Liens.

         2.6  REPRESENTATIONS  AND  WARRANTIES OF THE  PURCHASER.  To induce the
Seller  to enter  into this  Agreement,  the  Purchaser  hereby  represents  and
warrants to the Seller as follows:

              (a)  The  Purchaser  is a  duly  organized  and  validly  existing
corporation   in  good  standing   under  the  laws  of  its   jurisdiction   of
incorporation,  with all corporate power and authority to own its properties and
conduct its business as currently conducted.

              (b) Neither the execution  and delivery of this  Agreement nor the
performance by Parent and the Purchaser of its  obligations  hereunder,  nor the
consummation of the transactions  contemplated  hereby,  will: (i) conflict with
the Certificate of  Incorporation  or By-laws (or other governing  documents) of
the  Purchaser;  (ii)  violate any Law  applicable  to the  Purchaser;  or (iii)
violate, breach, be in conflict with or constitute a default (or an event which,
with  notice or lapse of time or both,  would  constitute  a default)  under any
note,  bond,  indenture,  mortgage,  deed of trust,  lease,  franchise,  permit,
authorization, license, contract, instrument or other agreement or commitment or
any  Judgment  to which  the  Purchaser  is a party,  except in each case to the
extent such matter would not materially  impair or delay, or reasonably could be
expected  to  materially  impair or  delay,  the  ability  of the  Purchaser  to
consummate the  transactions  contemplated  by this' Agreement or to perform its
obligations under this Agreement.

              (c) The Purchaser  has the full legal right and power  required to
enter  into,  execute  and  deliver  this  Agreement  and each of the  Ancillary
Agreements to which it is a party and to perform fully its obligations hereunder
and thereunder. This Agreement, and each of the Ancillary Agreements to which it
is a party, has been duly executed and delivered by the Purchaser, and, assuming
this  Agreement  and  each of the  Ancillary  Agreements  to which it is a party
constitutes a valid and binding

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obligation of the Seller,  constitutes  the valid and binding  obligation of the
Purchaser  enforceable  against  the  Purchaser  in  accordance  with its terms,
subject to the  qualifications  that  enforcement  of the  rights  and  remedies
created  hereby  is  subject  to  (a)  bankruptcy,  insolvency,  reorganization,
moratorium  and other  laws of  general  application  affecting  the  rights and
remedies  of  creditors  and (b) general  principles  of equity  (regardless  of
whether such enforcement is considered in a proceeding in equity or at law).

         2.7 CONDITIONS PRECEDENT TO THE CLOSING.

              (a) The  obligations  of the Purchaser to perform its  obligations
under this Agreement at the Closing are subject to the  fulfillment  prior to or
at the  Closing  of the  following  conditions,  any one or more of which may be
waived by the Purchaser:

                  (i)      Holdings shall have consummated the Equity Financing;

                  (ii)     the  Purchaser and the Seller shall have executed and
                           delivered the Amended EVLT Promotion Agreement;

                  (iii)    the Seller  shall have  executed  and  delivered  the
                           Assignment of Patents;

                  (iv)     Holdings  shall have caused the Stock  Incentive Plan
                           to be amended as follows:  (1) Section 1  ("Purpose")
                           shall be expanded to provide for grants of options to
                           consultants   where  such  grants  are  in  the  best
                           interests,  and further the business  of,  Diomed and
                           its  subsidiaries,  (2) Section 2(u)  ("Definitions")
                           shall  be  expanded  to  include  consultants  in the
                           definition  of  "Participant",  and (3) Section  5(a)
                           ("Stock  Options")  shall be revised to provide  that
                           the  exercise  price may be less than 100  percent of
                           the  Fair  Market  Value  on the Date of Grant if the
                           Company expressly so agrees in writing on or prior to
                           the Date of Grant; and

                  (v)      the  representations and warranties of the Seller set
                           forth in Section  2.5 shall be true and correct as of
                           the time of the Closing.

              (b) The obligations of the Seller to perform its obligations under
this Agreement at the Closing are subject to the fulfillment  prior to or at the
Closing  Date,  of the  following  conditions,  any one or more of which  may be
waived by the Seller:

                  (i)      Holdings shall have consummated the Equity Financing;

                  (ii)     the  Purchaser and the Seller shall have executed and
                           delivered the Amended EVLT Promotion Agreement;

                  (iii)    the  Purchaser  shall have executed and delivered the
                           Stock Option Agreement;

                  (iv)     the Purchaser shall have paid the Cash Portion of the
                           Purchase Price to the Seller; and

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                  (v)      the  representations  and warranties of the Purchaser
                           set forth in Section 2.6 shall be true and correct as
                           of the time of the Closing.

                                  ARTICLE III
              VARIABLE PAYMENT PROVISIONS AND REPORTING OBLIGATIONS

         In  addition  to the  payment  of the Cash  Portion  and grant of Stock
Options at the Closing, as further  consideration for the rights assigned by the
Seller to the Purchaser under this Agreement,  during the Variable Payment Term,
Purchaser  will make the  payments  set forth in this  Article III to the Seller
(the  "Variable  Payments")  within  forty  five (45) days  after the end of the
Calendar  Quarter in which the Variable  Payments  accrue.  For the avoidance of
doubt,  all  Variable  Payments  shall be paid by the  Purchaser,  whether  such
Variable  Payments  arise  from Net  Sales of the  Purchaser  or the  Purchasers
Affiliates  or  from  revenue  received  by the  Purchaser  or  the  Purchaser's
Affiliates from Licensees.

         3.1 Subject to Section 3.5,  Purchaser or Purchaser's  Affiliates shall
pay the Seller Variable  Payments equal to  [*CONFIDENTIAL  MATERIAL OMITTED AND
FILED  SEPARATELY  WITH THE  SECURITIES  AND EXCHANGE  COMMISSION  PURSUANT TO A
REQUEST FOR CONFIDENTIAL  TREATMENT] of Net Sales of EVLT Lasers,  EVLT Kits and
EVLT Fibers sold for delivery worldwide where patent protection does not exist.

         3.2 Subject to Section 3.5,  Purchaser or Purchaser's  Affiliates shall
pay to the Seller Variable Payments equal to [*CONFIDENTIAL MATERIAL OMITTED AND
FILED  SEPARATELY  WITH THE  SECURITIES  AND EXCHANGE  COMMISSION  PURSUANT TO A
REQUEST FOR CONFIDENTIAL  TREATMENT] of Net Sales of EVLT Lasers,  EVLT Kist and
EVLT Fibers sold for delivery worldwide where patent protection exists.

         3.3 Subject to Section 3.5, for OEM Sales of EVLT Lasers, EVLT Kits and
EVLT Fibers,  Purchaser or Purchaser's  Affiliates shall pay the Seller Variable
Payments equal to [*CONFIDENTIAL  MATERIAL OMITTED AND FILED SEPARATELY WITH THE
SECURITIES  AND  EXCHANGE  COMMISSION  PURSUANT  TO A REQUEST  FOR  CONFIDENTIAL
TREATMENT] of applicable Net Sales.

         3.4 Purchaser or Purchaser's  Affiliates  shall pay the Seller Variable
Payments equal to [*CONFIDENTIAL  MATERIAL OMITTED AND FILED SEPARATELY WITH THE
SECURITIES  AND  EXCHANGE  COMMISSION  PURSUANT  TO A REQUEST  FOR  CONFIDENTIAL
TREATMENT] of all revenues (exclusive of revenue from royalties on sales of EVLT
Lasers,  EVLT Kits and EVLT Fibers made by  Licensees)  received by Purchaser or
Purchaser's  Affiliates in the form of advances against  royalties and any other
"lump sum" payments  made by Licensees  for the right to License the  Technology
from  Purchaser,  and Purchaser or Purchaser's  Affiliates  shall pay the Seller
Variable Payments equal to [*CONFIDENTIAL  MATERIAL OMITTED AND FILED SEPARATELY
WITH  THE  SECURITIES  AND  EXCHANGE   COMMISSION  PURSUANT  TO  A  REQUEST  FOR
CONFIDENTIAL  TREATMENT]  of all revenues  received by Purchaser or  Purchaser's
Affiliates  in the form of royalties  on sales of EVLT  Lasers,  EVLT Fibers and
EVLT Kits made by Licensees.

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         3.5 After such time during the  Variable  Payment  Term as the Total of
Payments equals  [*CONFIDENTIAL  MATERIAL  OMITTED AND FILED SEPARATELY WITH THE
SECURITIES  AND  EXCHANGE  COMMISSION  PURSUANT  TO A REQUEST  FOR  CONFIDENTIAL
TREATMENT],  the Variable Payment  percentage rates stated above in Sections 3.1
through  3.3 shall be  reduced  to  [*CONFIDENTIAL  MATERIAL  OMITTED  AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL  TREATMENT],  beginning as of the first day of the Calendar Quarter
in  which  such  amounts  have  been  cumulatively  paid.   Notwithstanding  the
foregoing,  to the extent that any EVLT Lasers sold are lasers intended both for
endovenous  laser  treatment  or other leg vein  treatments  and for one or more
other uses,  then the amount of Net Sales on which  Variable  Payments  shall be
determined  shall  be the  list  price  charged  by the  Purchaser,  Purchaser's
Affiliate or Licensee, as the case may be, for an EVLT Laser intended solely for
endovenous laser treatment.

         3.6 Subject to restrictions on disclosure or other covenants  regarding
confidentiality  which may be  applicable,  the  Purchaser  shall furnish to the
Seller copies of all license  agreements  with  Licensees (and any amendments or
modifications  thereof) in due course after the execution thereof. The Purchaser
shall,  within sixty (60) days after each  Calendar  Quarter of each year during
the  Variable  Payment  Term,  deliver to the Seller true and  accurate  reports
pertaining to Net Sales and revenue from its Affiliates and all Licensees  which
shall include at least the following information:

              (a) with respect to the Purchaser's  and  Purchaser's  Affiliates'
Net Sales:

                  (i)      the  identity  of each  model or part  number of EVLT
                           Lasers, EVLT Fibers and EVLT Kits sold;

                  (ii)     the number of EVLT Lasers,  EVLT Fibers and EVLT Kits
                           (by model or part number) sold;

                  (iii)    Net Sales  inside the United  States and  outside the
                           United States, delineated as to those EVLT Lasers and
                           EVLT Kits sold by the  Purchaser on a branded and OEM
                           basis,  and Net Sales  inside the  United  States and
                           outside the United States by all Licensees,  for each
                           model or part number of EVLT Lasers,  EVLT Fibers and
                           EVLT Kits identified in (a) above;

                  (iv)     any and all  deductions  from Net  Sales  made by the
                           Purchaser or Purchaser's Affiliates,  as the case may
                           be, itemized by deduction and amount; and

                  (v)      total  Variable  Payments  payable to the Seller from
                           the Purchaser's and its Affiliates' Net Sales; and

              (b)  with  respect  to  revenues  from  Licensees  (excluding  the
Purchaser's or its Affiliates' distributors,  which shall be included in reports
under clause (i), above):

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                  (i)      names and addresses of all Licensees of the Purchaser
                           and Purchaser's Affiliates;

                  (ii)     "lump sum" payment income received from Licensees;

                  (iii)    royalty income received from Licensees;

                  (iv)     The Seller's  percentage share of revenue received by
                           the  Purchaser  and   Purchaser's   Affiliates   from
                           Licensees; and

                  (v)      Total  Variable  Payments  payable to the Seller from
                           revenue from Licensees.

         3.7 With each report submitted under Section 3.6 of this Agreement, the
Purchaser  shall pay to the Seller the Variable  Payments due and payable  under
Sections 3.1 through 3.5. If no Variable  Payments are due, the Purchaser  shall
so report in the report provided under Section 3.6; PROVIDED,  that with respect
to sales of EVLT  Lasers made other than in the United  States to third  parties
through  Licensees,  distributors  and sales agents  where the  Purchaser or the
Purchaser's Affiliate, as the case may be, does not know the intended use of the
product  sold,  the Purchaser or such  Affiliate  shall report such sales in the
Quarter in which the Purchaser or such  Affiliate  actually is made aware of the
intended  use of the  product  sold,  but in no event  later  than  the  Quarter
following the Quarter during which such sale occurs.

         3.8 The Seller  shall have the right to audit the books and  records of
the Purchaser and the Purchaser's  Affiliates,  but only to the extent that such
books and records relate to the transactions  contemplated under this Agreement.
In  addition  to any other  sums that may be owing to the  Seller as a result of
such audit,  the Purchaser and the Purchaser's  Affiliates  shall be responsible
for the cost of such audit in the event a  discrepancy  of five  percent (5%) or
more is documented by the Seller's auditor.

         3.9 (a) All  Variable  Payments  due to the  Seller  based  on sales in
countries  outside the United States shall accrue in the currency of the country
in which  the sales are  invoiced.  For  purposes  of this  Agreement,  sales in
countries  outside of the United  States  shall mean sales to persons  where the
EVLT Lasers,  EVLT Fibers or EVLT Kits are shipped to the purchaser for use in a
location outside of the United States, regardless of the place the sale actually
occurs or is deemed to have  occurred  for any other  purpose.  Payments  to the
Seller of Variable  Payments for foreign  sales shall be calculated on the basis
of currency  exchange rates in effect as of the date of the  Purchaser's  actual
collection of the  underlying  proceeds of foreign  sales.  The Purchaser  shall
utilize its best efforts to effect U.S.  Dollar or U.K Sterling  transfers  with
respect  to  such  Variable  Payments.   However,  the  Purchaser  will  not  be
responsible for any loss of exchange value, taxes, or other expenses incurred in
the transfer or conversion of foreign currency into U.S. Dollars.

              (b) Whenever currency  regulations of a country in which sales are
made  prohibit the deposit or payment of Variable  Payments to the Seller or its
nominee, no Variable Payment shall accrue or be due and payable by the Purchaser
or the  Purchaser's  Affiliate  with  respect  to such sales for so long as such
restrictions prevail.

                                       10
<PAGE>

         3.10 The  Variable  Payments  shall be payable as set forth in Sections
3.1 through  3.5 during the  Variable  Payment  Term  regardless  of whether the
Amended  EVLT  Promotion  Agreement is in effect and  regardless  of whether the
Seller is engaged in the practice of medicine.

         3.11 (a) The Purchaser  shall use  commercially  reasonable  efforts to
actively  market and sell EVLT  Lasers,  EVLT  Fibers  and EVLT Kits  during the
Variable  Payment  Term,  consistent  with the  practices of the medical  device
industry in the United States.

              (b) Notwithstanding the foregoing, and subject to Section 3.11(c),
the Purchaser may elect to offer for sale or otherwise distribute products which
may compete  with or be used as a substitute  for EVLT  Lasers,  EVLT Fibers and
EVLT  Kits on the  condition  that if the  Purchaser  commercially  launches  or
distributes any product for closing  varicose veins in the leg using  technology
other than the Technology,  then at the time of such launch or the  commencement
of such distribution,  the Purchaser shall within five (5) business days provide
written  notice to Seller (a  "Pay-out  Notice"),  which  Pay-out  Notice  shall
contain an irrevocable  offer by Purchaser to pay to the Seller in a lump sum in
cash an amount (the "Pay-out Amount"), if any, equal to [*CONFIDENTIAL  MATERIAL
OMITTED  AND  FILED  SEPARATELY  WITH THE  SECURITIES  AND  EXCHANGE  COMMISSION
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]. Purchaser agrees to meet with
Seller  after it gives  Seller  a  Pay-out  Notice  and to  provide  information
concerning  the nature of its competing or substitute  products and  Purchaser's
plans for the continuing  commercialization  of the EVLT Lasers, EVLT Fibers and
EVLT  Kits.  Within  thirty  (30) days of its  receipt  of a  Pay-out  Notice as
aforesaid,  Seller  shall have the  option of  accepting  Purchaser's  offer and
receiving the Pay-out  Amount by delivering to the Purchaser  written  notice of
acceptance,  whereupon the Purchaser  shall pay the Pay-out Amount to the Seller
within five (5) business days. If the Seller accepts the Purchaser's offer, upon
payment of the Pay-out Amount, the Seller shall no longer be entitled to receive
any  Variable  Payments,  and the  Seller  may  not  thereafter  terminate  this
Agreement  due to any breach or alleged  breach by the  Purchaser  of any of its
obligations  under this  Agreement or seek or bring any proceeding to obtain any
further amounts  arising in connection  with this Agreement or the  transactions
contemplated  by this  Agreement.  If the Seller does not accept the Purchaser's
offer to receive the Pay-out Amount within such thirty (30) day period, then the
Seller shall continue to receive Variable  Payments in accordance with the terms
of this  Agreement  and the  Purchaser's  and  Seller's  respective  rights  and
obligations under this Agreement shall be unchanged.

              (c) If,  as a result  of an  acquisition,  merger,  consolidation,
change of control,  purchase of assets or other business combination transaction
with any other  person,  the  Purchaser  is  offering  for sale or is  otherwise
distributing  products  which compete with or are used as a substitute  for EVLT
Lasers,  EVLT  Fibers  and  EVLT  Kits and the  sale or  other  distribution  of
competing or substitute  products was part of the pre-existing  business of such
other person,  then the  Purchaser  shall not be obligated to provide the Seller
with a Pay-out

                                       11
<PAGE>

Notice  if the  Purchaser  has  divested  or  discontinued  the  sale  or  other
distribution  of such  competing or substitute  products  within nine (9) months
after  the  effective  date of such  business  combination  transaction.  If the
Purchaser has not divested or  discontinued  the sale or other  distribution  of
such competing or substitute  products  within such nine (9) month period,  then
the Purchaser shall deliver a Pay-out Notice within five (5) business days after
the end of such nine (9) month period and the other  provisions  of Section 3(b)
shall be applicable.

         3.12 The Purchaser  shall pay interest at the rate of five percent (5%)
per annum on any Variable  Payments or portions thereof that remain unpaid after
the  applicable  due date thereof set forth in this Article III  (including  any
amounts which are  determined to have been  underpaid  pursuant to Section 3.8),
such  interest to accrue  commencing  on the due date  therefor  and  continuing
through  the day  immediately  preceding  the date such  Variable  Payments  are
remitted to Seller.

                                   ARTICLE IV
                            AMENDMENT AND RESTATEMENT
                         OF THE EVLT PROMOTION AGREEMENT

         4.1 Effective upon the Closing, with no further action of the Purchaser
or the Seller,  the EVLT  Promotion  Agreement  shall be amended and restated in
full as set forth in the Amended EVLT Promotion Agreement.

         4.2 If the Closing  does not occur on or prior to  September  15, 2003,
the EVLT  Promotion  Agreement  shall  remain in full force and  effect  without
amendment or restatement.

                                   ARTICLE V
                        PATENT PROSECUTION AND LITIGATION

         5.1 The Purchaser shall be solely  responsible for patent  prosecution,
foreign patent filing and patent maintenance of the Patents,  all of which shall
be paid for by the Purchaser.  The Seller agrees to do all such further acts and
execute all such further applications, documents and instruments relating to the
Patents and the prosecution  and  maintenance  thereof as the Purchaser may from
time  to  time  require  or  request  in  order  to make  and  prosecute  Patent
applications and to obtain, perfect, provide evidence or protect the Patents and
the Purchaser's  rights hereunder.  In furtherance of the foregoing,  the Seller
hereby  exclusively   appoints  the  Purchaser  to  execute  such  applications,
documents  and  instruments  in the Seller's  name and on its behalf as its duly
authorized agent and attorney-in-fact and this appointment shall be deemed to be
a power  coupled with an interest and shall be  irrevocable  during the Variable
Payment  Term.  Seller's  acts  in  furtherance  of  the  forgoing  shall  be at
Purchaser's  sole  cost  and  expense,   subject  to  Seller's   indemnification
obligation under Section 6.2 to the extent applicable.

         5.2 The Seller  agrees to  cooperate  with the  Purchaser's  efforts to
prosecute  and  maintain  the Patents,  and to provide  such  assistance  as the
Purchaser  reasonably  requests in  furtherance  of the  Purchaser's  efforts to
prosecute and maintain such Patents,  subject to  reimbursement  of the Seller's
reasonable expenses by the Purchaser,  with a maximum daily rate of $2,000, plus
reasonable travel expenses, if any.

         5.3 If any action alleging invalidity or non-infringement of any of the
Patents is brought by a third party  against the Seller,  then the Seller  shall
provide  notice  thereof as set forth below,  and the  Purchaser  shall have the
right to  intervene  and take over the sole  defense  of the

                                       12
<PAGE>

action and assert  claims on behalf of the Seller and the  Purchaser  at its own
expense, subject to the Seller's  indemnification  obligation under Section 6.2.
The  Seller  shall  provide  the  Purchaser  written  notice of any such  claim,
proceeding or suit as promptly as practicable but in no event later than fifteen
(15) days after the Seller's receipt of notice thereof.

         5.4 (a) The Seller shall promptly  inform the Purchaser of any act by a
third party which it believes is an infringement or similar  violation of any of
the  Purchaser's  rights under the Patents after the Seller  discovers  facts or
circumstances  which suggests to the Seller that any such  infringement may have
occurred, be occurring or will occur.

              (b) The Purchaser will have the sole right to determine whether to
pursue its legal remedies against any purported third party infringer, including
the right to settle and/or litigate the matter with the third party infringer.

              (c) If the Purchaser chooses to enforce any Patent against a third
party  infringer or to otherwise  pursue  legal  recourse  against a third party
infringer,  the  Purchaser  will be  responsible  for all costs and  expenses in
connection with the enforcement  proceeding.  Any monetary  recovery (whether by
settlement,  award  or  judgment)  as a  result  of  an  infringement  claim  or
counterclaim  by the  Purchaser  against a third party shall be allocated as set
forth in Section 5.4(d). The Seller consents to being joined to the action as an
interested  party,  and will, at the Purchaser's  expense of no more than $2,000
per day plus reasonable  travel expenses,  cooperate in all respects and, to the
extent possible,  have the Seller's  representatives  and employees testify when
requested.  The Seller shall also maintain during the Variable  Payment Term and
make available upon the Purchaser's request to the Purchaser and the Purchaser's
attorneys and other appropriate  representatives  all relevant records,  papers,
information samples, and the like pertaining to the Technology and the Patents.

              (d) If  Purchaser  chooses to enforce  any Patent  against a third
party infringer,  by commencement  and maintenance of an infringement  action or
other action  seeking to enforce its rights  under any of the Patent,  Purchaser
shall pay all  patent  litigation  costs.  Any  monetary  recovery  (whether  by
settlement,  award  or  judgment)  received  by  Purchaser  as a  result  of  an
infringement  claim or counterclaim by Purchaser  against a third party shall be
allocated as follows:

                  FIRST,  to  Purchaser  until an  amount  equal  to all  patent
                  litigation costs,  together with interest thereon at an annual
                  rate equal to the prime rate,  as published in THE WALL STREET
                  JOURNAL,  as of the  date of  determination,  plus  200  basis
                  points, has been recouped in full; and

                  SECOND,  as to all amounts of any such monetary  recovery that
                  are  allocable on the basis of date of sale or other  transfer
                  to the  period of time up to and  through  the  Closing  Date,
                  [*CONFIDENTIAL  MATERIAL OMITTED AND FILED SEPARATELY WITH THE
                  SECURITIES AND EXCHANGE  COMMISSION  PURSUANT TO A REQUEST FOR
                  CONFIDENTIAL  TREATMENT]  of such amounts shall be retained by
                  Purchaser; and

                                       13
<PAGE>

                  THIRD,  as to all amounts of any such  monetary  recovery that
                  are  allocable on the basis of date of sale or other  transfer
                  to the period of time after the  Closing  Date,  such  amounts
                  shall be paid to Seller and Purchaser, respectively, as if any
                  such  amount  that is a fixed  amount  were a lump sum payment
                  from a  Licensee  and as if any  future  royalties  or similar
                  contingent  payments  constituting  part  of the  recovery  or
                  settlement were royalties from a Licensee,  all as provided in
                  Section 3.4.

                                   ARTICLE VI
                            SURVIVAL; INDEMNIFICATION

         6.1   SURVIVAL   OF   AGREEMENTS,   REPRESENTATIONS   AND   WARRANTIES.
Notwithstanding  any investigation  conducted or notice or knowledge obtained by
or on behalf of any party hereto, each agreement in this Agreement shall survive
the  Closing  without  limitation  as to time  until  fully  performed  and each
representation  and warranty in this Agreement or in the Exhibits,  Schedules or
certificates  delivered pursuant to this Agreement shall survive the Closing for
a without limitation as to time.

         6.2 INDEMNIFICATION BY THE SELLER. From and after the Closing Date, the
Seller  will  indemnify,  hold  harmless  and  defend,  the  Purchaser  and  its
Affiliates  (and their  respective  directors,  officers,  agents and employees,
successors and assigns)  (each, a "PURCHASER  INDEMNIFIED  PARTY") in accordance
with the provisions of this Article VI from and against:

                  (i)      any and all Damages incurred and actually paid by any
                           of them arising out of, relating to or based upon any
                           inaccuracy   in,   or   breach   of,   any   of   the
                           representations    or   warranties,    covenants   or
                           agreements  of the Seller or the LLC  contained in or
                           incorporated  into this Agreement or in the Schedules
                           hereto; and

                  (ii)     any cost  incurred and actually paid by the Purchaser
                           in connection  with the enforcement of this Agreement
                           or the EVLT Promotion Agreement.

The right of the Purchaser Indemnified Parties to be indemnified hereunder shall
not be limited or affected by any investigation conducted or notice or knowledge
obtained  by  or  on  behalf  of  any  such  Persons.  Seller's  indemnification
obligation  as set forth above shall be limited to the  aggregate  amount of the
Purchase Price paid to seller  through the date of the  indemnified  claim.  For
purposes of the foregoing, the value of the Stock Options shall be determined as
of the Closing Date using the  Black-Scholes  option  valuation method (or other
comparable method).

         6.3  PURCHASER'S  INDEMNITY.  From and  after  the  Closing  Date,  the
Purchaser will indemnify, hold harmless and defend the Seller from and against;

                  (i)      any and all Damages  incurred  by the Seller  arising
                           out of,  relating to or based upon any inaccuracy in,
                           or  breach   of,  any  of  the   representations   or
                           warranties,  covenants or agreements of the Purchaser
                           contained in or  incorporated  into this Agreement or
                           in certificates delivered pursuant to this Agreement;
                           and

                                       14
<PAGE>

                  (ii)     any Cost  incurred by the Seller in  connection  with
                           the   enforcement  of  this  Agreement  or  the  EVLT
                           Promotion Agreement.

The  rights of the  Seller to be  identified  hereunder  shall not be limited or
affected by any investigation conducted or notice or knowledge obtained by or on
behalf of such persons.

         6.4 METHOD OF  ASSERTING  CLAIMS.  The party  making a claim under this
Article 5 is referred to as the  "Indemnified  Party" and the party against whom
such  claims  are  asserted   under  this  Article  5  is  referred  to  as  the
"Indemnifying  Party".  All claims by any Indemnified Party under this Article 5
shall be asserted and resolved as follows:

              (a) Whenever an  Indemnified  Party  becomes  aware of a claim for
which an Indemnifying  Party would be liable to an Indemnified  Party hereunder,
the  Indemnified  Party shall with reasonable  promptness  notify in writing the
Indemnifying Party of such claim,  identifying the representation or warranty on
which such claim is based, the basis for such claim or demand, and the amount or
the estimated  amount thereof to the extent then  determinable  (which  estimate
shall not be conclusive of the final amount of such claim and demand; the "Claim
Notice"); provided, that any failure to give a Claim Notice will not be deemed a
waiver of any rights of the Indemnified Party except to the extent the rights of
the Indemnifying Party are actually  prejudiced by such failure. If the basis of
such claim is a claim or demand by a third party, the Indemnifying  Party,  upon
request of the Indemnified  Party, shall retain counsel (who shall be reasonably
acceptable  to the  Indemnified  Party) to represent the  Indemnified  Party and
shall pay the  reasonable  fees and  disbursements  of such  counsel with regard
thereto;  provided, that any Indemnified Party is hereby authorized prior to the
date on which it receives written notice from the Indemnifying Party designating
such counsel, to retain counsel, whose fees and expenses shall be at the expense
of the Indemnifying Party, to file any motion, answer or other pleading and take
such other  action  which it  reasonably  shall deem  necessary  to protect  its
interests  or those  of the  Indemnifying  Party  until  the  date on which  the
Indemnified  Party receives such notice from the Indemnifying  Party.  After the
Indemnifying  Party shall retain such counsel,  the Indemnified Party shall have
the right to retain its own  counsel,  but the fees and expenses of such counsel
shall be at the expense of such  Indemnified  Party unless (x) the  Indemnifying
Party and the  Indemnified  Party shall have mutually agreed to the retention of
such counsel or (y)  representation of both parties by the same counsel would be
inappropriate due to actual or potential  differing  interests between them. The
Indemnifying  Party shall not, in  connection  with any  proceedings  or related
proceedings  in the same  jurisdiction,  be liable for the fees and  expenses of
more than one such firm for the  Indemnified  Party  (except  to the  extent the
Indemnified Party retained counsel to protect its (or the Indemnifying  Party's)
rights  prior  to the  selection  of  counsel  by the  Indemnifying  Party).  If
requested by the Indemnifying  Party, the Indemnified  Party agrees to cooperate
with the  Indemnifying  Party and its counsel in contesting  any claim or demand
which the  Indemnifying  Party defends.  A claim or demand may not be settled by
either party without the prior written consent of the other party (which consent
shall not be unreasonably  withheld)  unless,  as part of such  settlement,  the
Indemnified  Party shall  receive a full and  unconditional  release  reasonably
satisfactory to such Indemnified Party.

                                       15
<PAGE>

              (b) Whenever any Indemnified  Party shall have a claim against any
Indemnifying  Party  hereunder  which does not  involve a claim or demand  being
asserted  against  or  sought  to be  collected  from it by a third  party,  the
Indemnified  Party shall send a Claim  Notice with  respect to such claim to the
Indemnifying Party.

         6.5 GENERAL PROVISIONS. The following general provisions shall apply to
any claim for indemnification under this Article VI:

              (a) The amount of any claim  subject to  indemnification  shall be
determined  after taking into account the present value of any tax benefits (net
of tax  detriments)  accruing to the  Indemnified  Party or any  Affiliate  as a
result of such claim.

              (b) Except as  otherwise  set forth in this Section  6.5(b),  with
respect  to  any  breach,  violation  or  nonfulfillment  of or  default  in the
performance  of any  representation,  warranty or covenant of this Agreement for
which a right to claim indemnification is provided in this Article VI, after the
Closing a claim or an action  under and  pursuant to the terms,  conditions  and
limitations of this Article VI shall be the sole and exclusive  right and remedy
of the Purchaser and the Seller,  and neither the Purchaser nor the Seller shall
have any  other  claim,  cause of  action,  right,  or remedy  for such  breach,
violation,  non-fulfillment  or  default  against  the  other  based  upon  this
Agreement,  any  provision of any  securities  or other  statute,  law,  rule or
regulation or based upon any other cause of action  arising at law or in equity;
provided,  that if for any reason a court of competent jurisdiction shall refuse
to enforce  this  provision,  and shall  permit the  Purchaser  or the Seller to
assert any action  based other than upon the right to claim  indemnification  as
provided in this Article VI, the  Purchaser and the Seller agree that the amount
of such other claim shall be subject to and  limited by the  provisions  of this
Article  VI. The  provisions  of this  Section  6.5(b)  shall not  preclude  the
prosecution of any action or proceeding  based on fraud that, if found to exist,
would be sufficient to give rise to the right of rescission  with respect to the
transactions contemplated by this Agreement.

         6.6 RIGHT OF  OFFSET.  If and to the  extent  that any of the Seller is
obligated  to  indemnify,  defend and hold the  Purchaser  harmless  pursuant to
Section 6.2, the Purchaser may, at its sole election, satisfy all or part of any
such  obligation  of the Seller by  offsetting  any amounts due to the Purchaser
from the Seller against any amounts due to such Seller from the Purchaser  under
this Agreement or under the EVLT Promotion Agreement.

                                  ARTICLE VII
                            TERMINATION OF AGREEMENT

         7.1 TERMINATION  PRIOR TO CLOSING.  This Agreement may be terminated at
any time after the Effective Date and prior to the Closing as follows:

              (a) by mutual written consent of the Purchaser and the Seller; or

              (b) by the  Purchaser,  on the one hand, or by the Seller,  on the
other hand, by written  notice to the other party  hereto,  if the Closing shall
not have  occurred on or prior to the close of business  on  September  15, 2003
(unless  such delay has been caused by a breach of this  Agreement  by the party
seeking such termination).

                                       16
<PAGE>

         7.2 TERMINATION AFTER CLOSING DATE. This Agreement may be terminated at
any time after the Closing Date as follows:

              (a) by the  Seller  if the  Purchaser  shall  fail to make  timely
payment of any part of the  Purchase  Price and such  payment is not  thereafter
made to Seller  within  sixty (60) days after the date when  Seller  provides to
Purchaser written notice of non-payment in accordance with Section 8.3; or

              (b) automatically and without any notice or action by either party
upon the  effective  date of the time when the last of the  Patents  shall  have
expired or been held invalid by a court of proper jurisdiction, which holding is
not or cannot be further appealed.

                                  ARTICLE VIII
                                  MISCELLANEOUS

         8.1 EXPENSES.  Each of the parties to this Agreement  shall pay his own
expenses  (including,  without limitation,  attorney's and accountants' fees and
out-of-pocket   expenses)  incident  to  this  Agreement  and  the  transactions
contemplated  hereby;  PROVIDED,  that the Purchaser shall pay to the Seller all
reasonable costs and expenses,  including  attorney fees,  incurred by Seller if
Seller  prevails in legal  proceedings  against  Purchaser  brought by Seller to
obtain payment of any Variable Payments.

         8.2  FURTHER  ASSURANCES.  At any time and from time to time  after the
Closing Date at the request of the Purchaser, and without further consideration,
the Seller will execute and deliver such other  instruments  of sale,  transfer,
conveyance,  assignment  and  confirmation  and take  such  other  action as the
Purchaser  may  reasonably  deem  necessary  or  desirable in order to transfer,
convey and assign the Patents to the  Purchaser  and to assist the  Purchaser in
exercising  all rights with respect  thereto.  The parties  shall use their best
efforts to fulfill or obtain the  fulfillment  of the conditions to the Closing,
including,  without  limitation,  the execution and delivery of any documents or
other papers,  the execution and delivery of which are  conditions  precedent to
the Closing.

         8.3 NOTICES.  All notices,  requests,  demands and other communications
required or  permitted  to be given  hereunder  shall be in writing and shall be
given personally,  sent by facsimile transmission or sent by prepaid air courier
or certified or express mail,  postage prepaid.  Any such notice shall be deemed
to have  been  given  (a) when  received,  if  delivered  in  person  or sent by
facsimile  transmission (if clearly received in full) or (b) three business days
following  the mailing  thereof,  if sent by prepaid air courier or certified or
express mail,  postage prepaid,  return receipt  requested,  in any such case as
follows (or to such other  address or  addresses as a party may have advised the
other in the manner provided in this Section 8.3):

                                       17
<PAGE>

                  If to the Seller:

                  Dr. Robert Min
                  c/o Endovenous Laser Associates, L.L.C.
                  416 East 55th Street
                  New York, NY  10022

                  With a copy to:

                  Olshan, Grundman, Frome, Rosenzweig & Wolosky LLP
                  505 Park Avenue
                  New York, New York  10022
                  Attn:  Randy Friedberg, Esq.

                  If to the Purchaser:

                  Diomed, Inc.
                  One Dundee Park
                  Andover, Massachusetts  01810
                  Attention:

                  With a copy to:

                  McGuireWoods LLP
                  Suite 1620
                  9 West 57th Street
                  New York, New York  10166
                  Attention: William A. Newman, Esq.

         8.4 PUBLICITY.  No publicity  release or  announcement  concerning this
Agreement or the transactions  contemplated hereby shall be made without advance
approval  thereof by the Purchaser and the Seller,  except as may be required by
applicable law or the rules and regulations of the U.S.  Securities and Exchange
Commission or the American Stock Exchange.

         8.5 ENTIRE  AGREEMENT.  This  Agreement  (including  the  Exhibits  and
Schedules)  and the  agreements,  certificates  and  other  documents  delivered
pursuant to this Agreement  contain the entire  agreement among the parties with
respect  to  the  transactions   described  herein,   and  supersede  all  prior
agreements, written or oral, with respect thereto; PROVIDED, that the provisions
of Paragraph 4 under  "Other  Terms" and  Paragraphs  1 and 2 under  "Standstill
Agreement"  under that  certain  Term Sheet signed by the parties and dated June
11, 2003 shall survive and not be superceded by this Agreement.

         8.6  SEVERABILITY.  If any term or other provision of this Agreement is
invalid,  illegal or  incapable  of being  enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the  economic or legal  substance  of
the transactions  contemplated  hereby is not affected in any manner  materially
adverse to any party. Upon such  determination  that any term or other provision
is invalid,  illegal or incapable of being  enforced,  the parties  hereto shall
negotiate  in good faith to modify this  Agreement  so as to effect the original
intent of the parties as closely as possible in an acceptable  manner to the end
that the  transactions  contemplated  hereby are fulfilled to the fullest extent
possible.

                                       18
<PAGE>

         8.7 WAIVERS AND AMENDMENTS. This Agreement may be amended,  superseded,
canceled,  renewed or extended,  and the terms  hereof may be waived,  only by a
written  instrument  signed by the Purchaser and the Seller or, in the case of a
waiver,  by the party waiving  compliance.  No delay on the part of any party in
exercising  any right,  power or privilege  hereunder  shall operate as a waiver
thereof

         8.8 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance  with the laws of the State of New York without  regard to principles
of conflicts of law.

         8.9  JURISDICTION.  Each of the Purchaser and each of the Seller hereby
irrevocably   and   unconditionally   consents  and  submits  to  the  exclusive
jurisdiction  of any state or  federal  court  located  within the County of New
York, State of New York, in connection with any,  actions,  suits or proceedings
arising  out of or  relating  to this  Agreement,  the  Amended  EVLT  Promotion
Agreement  or any of the  agreements  delivered  in  connection  herewith or the
transactions  contemplated  hereby or  thereby.  Each of the  Purchaser  and the
Seller  hereby waives any  objection to venue in such  jurisdiction,  and agrees
that service of any summons, complaint, notice or other process relating to such
proceeding  may be effected as provided by Section  8.3, or to their  respective
attorneys at their  respective  addresses set forth in Section 8.3 by recognized
overnight express service.

         8.10 BINDING EFFECT,  ASSIGNMENT.  This Agreement shall be binding upon
and inure to the  benefit of the  parties and their  respective  successors  and
permitted  assigns.  This Agreement is not assignable by Seller, by operation of
law or otherwise,  without the prior written  consent of the Purchaser,  law and
any  other  purported  assignment  shall be null and  void.  This  Agreement  is
assignable  by  Purchaser  without  the prior  written  consent  of the  Seller;
PROVIDED  that if this  Agreement is assigned by Purchaser by agreement  with an
assignee,  such  assignee  shall  acknowledge  in writing its  assumption of the
Purchaser's obligations hereunder.

         8.11  VARIATIONS IN PRONOUNS.  All pronouns and any variations  thereof
refer to the masculine,  feminine or neuter,  singular or plural, as the context
may require.

         8.12 COUNTERPARTS. This Agreement may be executed by the parties hereto
in separate counterparts,  each of which when so executed and delivered shall be
an original,  but all such  counterparts  shall together  constitute one and the
same instrument.  Each counterpart may consist of a number of copies hereof each
signed by less than all, but together signed by all of the parties hereto.

         8.13 EXHIBITS AND  SCHEDULES.  The Exhibits and Schedules are a part of
this Agreement as if fully set forth herein.  All references herein to Sections,
subsections,  clauses, Exhibits and Schedules shall be deemed references to such
parts of this Agreement, unless the context shall otherwise require.

         8.14 HEADINGS.  The headings in this Agreement are for reference  only,
and shall not affect the interpretation of this Agreement.

                                       19
<PAGE>

         8.15 CERTAIN TAX MATTERS.  The Seller and the Purchaser  agree that the
Assignment of the Patents contemplated  hereunder  constitutes a transfer of all
substantial  rights to the patents and  pursuant to Section 1245 of the Internal
Revenue code of 1986, as amended (the "Code")  shall be  considered  the sale or
exchange of a capital  asset held for more than one year and not a license.  The
Seller and Purchaser  agree to neither shall take any position on any tax return
inconsistent  with the  foregoing  with  respect  to the  payments  contemplated
hereunder,  including,  without  limitation,  the Cash  Portion of the  Purchase
Price,  the Stock  Options  granted to the Seller  pursuant to the Stock  Option
Agreement and the Variable Payments,  the value of which shall be treated by the
Purchaser as the purchase price of the Patents.  In no event shall the Purchaser
treat the Stock  Options as  compensatory  options  subject to Section 83 of the
Code.

                            [Signature Page Follows]

                                       20
<PAGE>

                  IN WITNESS  WHEREOF,  the parties have executed this Agreement
as of the date first above written.

                                 PURCHASER

                                 DIOMED, INC.

                                 By: /s/ James A. Wylie, Jr.
                                    ---------------------------------------
                                    Name: James A. Wylie, Jr.
                                    Title: President and Chief Executive Officer

                                 SELLER

                                 /s/ Robert J. Min, M.D.
                                 -------------------------------------------
                                 Name: Robert J. Min, M.D.

                                       21
<PAGE>

                              SCHEDULE I -- PATENTS

              [SUBJECT TO REVIEW AND UPDATE AT THE TIME OF CLOSING]

US  Patent No. 6,398,777

WO Patent No. 200044296

AU  Patent No. 200029753

EP   Patent No.  1156751

                                       22

<PAGE>

                                                                       EXHIBIT A

                  Form of Non-Qualified Stock Option Agreement

                               [DIOMED LETTERHEAD]

_________ ____, 2003
[Closing Date to be inserted]

Robert J. Min, M.D.
c/o Endovenous Laser Associates, L.L.C.
416 East 55th Street
New York, NY  10022

Dear Dr. Min:

         Pursuant to the Purchase  Agreement between you and Diomed,  Inc. dated
July 23, 2003 (the "Purchase Agreement"),  Diomed Holdings, Inc. (the "Company")
hereby  grants to you  non-qualified  stock  options to  purchase  shares of the
Company's Common Stock as set forth below.

         The grant of this option is made pursuant to the Diomed Holdings,  Inc.
Omnibus Incentive Plan (the "Plan"). The terms of the Plan are incorporated into
this letter and in the case of any  conflict  between the Plan and this  letter,
the terms of the Plan shall control.  Notwithstanding the foregoing, in the case
of a  conflict  between  the  Plan  and the  Purchase  Agreement,  the  Purchase
Agreement shall control.

         Now,  therefore,  in  consideration  of the  foregoing  and the  mutual
covenants hereinafter set forth:

                  1. NON-QUALIFIED STOCK OPTION. The Company hereby grants you a
         non-qualified  stock option  ("NSO") to purchase from the Company up to
         800,000  shares of Company Common Stock at a price of $_____ per share.
         [Exercise price to be inserted once it is determined] The Date of Grant
         is _____________ ___, 2003. [Closing Date to be inserted]

                  2.  ENTITLEMENT  TO EXERCISE  THE NSO. The grant of the NSO is
         subject to the following terms and conditions:

                           (a) The NSO is 100% vested and,  subject to the terms
                           and conditions set forth herein, fully exercisable at
                           all times until the expiration of the NSO.

                           (b) The NSO may be  exercised  with respect to all or
                           any  part of the  shares  of  Company  Stock  covered
                           hereby  at any time  prior to the  expiration  of ten
                           (10) years from the Date of Grant.

                  3. METHOD OF EXERCISE & PAYMENT  UNDER NSO.  You may  exercise
         the vested  portion of the NSO in whole or in part,  by giving  written
         notice to the Company  which shall state the  election to exercise  the
         NSO and the number of shares of Company Stock with respect to which the
         NSO is being  exercised.  The  written  notice  shall be  signed by the
         person  exercising  the  NSO,  shall  be  delivered  to  the  Corporate
         Secretary of the Company at the Company's  principal  executive office,
         indicating  the method of exercise.

                                       1
<PAGE>

         You may exercise  the NSO by either of the  following  methods:  (i) by
         payment of the exercise  price in cash or by check,  (ii) provided that
         at the time of  exercise  the  Common  Stock  is  publicly  traded,  by
         delivery of  already-owned  shares of Common Stock either that you have
         held  for the  period  required  to  avoid a  charge  to the  Company's
         reported  earnings  (generally six months) or that you did not acquire,
         directly or indirectly, from the Company, that are owned free and clear
         of all liens, claims,  encumbrances or security interests, and that are
         valued at the fair market  value  thereof on the date of  exercise  (as
         defined in the Plan) or (iii) provided that at the time of exercise the
         Common  Stock is publicly  traded,  you may elect to receive  upon such
         exercise  the  "Net  Number"  of  shares  of  Common  Stock  determined
         according to the following formula (a "Cashless Exercise"):

                  Net Number = (A X B) - (A X C)
                               -----------------
                                       B

                  For purposes of the foregoing formula:

                  A= the total  number of shares of Common Stock with respect to
         which this NSO is then being exercised.

                  B= the  closing  bid Price of the Common  Stock on the date of
exercise of the NSO.

                  C= the exercise  price then in effect for the shares of Common
         Stock as to which this NSO is then being exercised.

                  4. ADJUSTMENTS. If the number of outstanding shares of Company
         Stock  is  increased  or  decreased  as a result  of one or more  stock
         splits,  reverse  stock  splits,  stock  dividends,  recapitalizations,
         mergers,     share    exchange     acquisitions,     combinations    or
         reclassifications,  the number of shares with respect to which you have
         an unexercised NSO and the NSO price shall be appropriately adjusted as
         provided in the Plan.

                  5. DELIVERY OF CERTIFICATE.  The Company may delay delivery of
         the certificate for shares purchased pursuant to the exercise of an NSO
         until (i) receipt of any required  representation  by you or completion
         of any  registration  or other  qualification  of such shares under any
         state or  federal  law  regulation  that the  Company's  counsel  shall
         determine as necessary or advisable, and (ii) receipt by the Company of
         advice by counsel  that all  applicable  legal  requirements  have been
         complied  with.  As a  condition  of  exercising  the  NSO,  you may be
         required to execute a customary  written  indication of your investment
         intent  and such  other  agreements  the  Company  deems  necessary  or
         appropriate to comply with applicable securities laws.

                                       Diomed Holdings, Inc.
                                       -------------------------------------
                                       Name:
                                       Title:

                                       2
<PAGE>

                                                                       EXHIBIT B

                             ASSIGNMENT OF INVENTION

         WHEREAS,  I, Robert J. Min, M.D., have invented  certain new and useful
improvements  in Patent No. US 6,398,777  entitled  "Endolaser  Laser Device and
Treatment of Varicose Veins" for which a patent application has been executed.

         AND  WHEREAS,  Diomed,  Inc.,  having a principal  place of business in
Andover,  Massachusetts,  referred to as Assignee,  is desirous of acquiring our
interest  in said  invention  and in any  Letters  Patent  which may be  granted
therefor.

         NOW THIS INDENTURE WITNESSETH,  That for a valuable consideration,  the
receipt of which is hereby acknowledged, I hereby assign, sell and transfer unto
the said  assignee,  my entire  right,  title and interest in and to  inventions
disclosed  in said  application  and in and to any Letters  Patent of the United
States and in and to any Letters  Patent or Inventor's  Certificates  of any and
all foreign countries which may be granted  therefor,  and in and to any and all
priority and/or  Convention  rights or benefits accruing or to accrue to us with
respect  to the filing or  securing  of  patents  in the  United  States  and/or
securing of patents or inventor's  certificates in any and all countries foreign
thereto.

         AND I hereby  grant to assignee  the right to apply in its own name for
patents or  inventor's  certificates  corresponding  to the above  invention  in
countries foreign to the United States.

         AND I hereby further agree to sign and properly  execute such necessary
and  lawful  papers  for   application   for  foreign   patents  and  inventor's
certificates  for filing  applications  for United States,  foreign  patents and
inventor's  certificates  for  subdivisions  of any  applications  for patent or
inventor's  certificate  and/or for  obtaining  any  reissue or  reissues of any
Letters  Patent which may be granted for our aforesaid  invention and to perform
such further  acts as may be required to carry out the intent of this  agreement
as the  assignee  thereof  shall  hereafter  require and  prepare at  assignee's
expense.

         WITNESSETH, my hand this _____ day of August, 2003.

                                             /s/ Robert J. Min, M.D.
                                             ------------------------------
                                             Robert J. Min, M.D.

                                       1

<PAGE>

STATE OF ____________________
                                            )ss:
COUNTY OF __________________

         On  this  ____  day  of  ____________________,  2003,  before  me  came
_____________________,  to me known to be the individual(s) described in and who
executed the foregoing  instrument,  and acknowledged to me that he executed the
same.

                                         ----------------------------
                                         Notary Public

                                       2

<PAGE>

                                 [LOGO] DIOMED

                                                                       EXHIBIT C

           AMENDED AND RESTATED EVLT MARKETING AND PROMOTION AGREEMENT

         AMENDED AND RESTATED EVLT  MARKETING AND  PROMOTION  AGREEMENT  entered
into as of ____________ ____, 2003 between Diomed,  Inc., a Delaware corporation
having its principal offices at 1 Dundee Park, Andover, MA 01810 ("Diomed"), Dr.
Robert  Min  of  New  York,  New  York  (the  "Doctor"),  and  Endovenous  Laser
Associates, L.L.C., a New York limited liability company with a principal office
at 416 East 55th Street, New York, New York 10022 (the "LLC").

                                    RECITALS

         WHEREAS,   Diomed  is  in  the  business  of   developing,   marketing,
manufacturing and selling laser systems for medical applications;

         WHEREAS, the Doctor is a named co-inventor and co-owner under a process
patent,  U.S.  Patent No.  6,398,777,  entitled  "Endovascular  Laser Device and
Treatment of Varicose Veins" (the "Process Patent Rights");

         WHEREAS,  the Doctor is the named inventor  under a patent  application
covering  design and function of optical  fibers,  filed by Diomed,  application
number  85.70.75122  15 June 2001,  entitled  medical  laser device (such patent
application, together with all inventions, discoveries or improvements authored,
conceived,  developed,  reduced to practice, or otherwise obtained by the Doctor
that are referenced therein are referred to collectively as the "Fiber Patent");

         WHEREAS,  pursuant to the Marketing and Promotion Agreement dated as of
August  29,  2001  (the  "2001  Agreement"),  the  Doctor  granted  to  Diomed a
nonexclusive  license to use of the Process Patent Rights and assigned to Diomed
all rights he had or may have had in the Fiber Patent;

         WHEREAS,  the Doctor is trained and  knowledgeable in the use of lasers
for the endovenous treatment of varicose veins;

         WHEREAS,  for the purposes of the 2001  Agreement  and this  Agreement,
EVLT(R) is defined as any internal  varicose  vein  treatment  performed  with a
laser and an optical fiber ("EVLT") (EVLT(R) being a Diomed trademark);

         WHEREAS,  the Doctor has formed a single  member LLC for the purpose of
conducting the activities contemplated by the 2001 Agreement and this Agreement;

         WHEREAS,  Diomed markets and sell lasers,  optical fibers and procedure
kits  worldwide,  including  lasers  and  optical  fibers  for use in EVLT where
regulatory  approval is required  and has been  obtained,  including  the Unites
States,  where Diomed has obtained U.S. Food and Drug  Administration  Clearance
for the use of its lasers to perform EVLT;

<PAGE>

                                 [LOGO] DIOMED

         WHEREAS,  as  contemplated by the 2001  Agreement,  the Doctor,  acting
through the LLC, has trained  other  physicians  in the use of the Diomed lasers
and optical  fibers for EVLT and has  otherwise  promoted  the use of the Diomed
lasers and optical  fibers for EVLT, and wishes to continue to do so pursuant to
this Agreement, all as more specifically set forth in this Agreement;

         WHEREAS,  under the 2001 Agreement,  Diomed engaged the Doctor,  acting
through his LLC, to help maximize Diomed's sales worldwide of lasers and optical
fibers for EVLT and the Doctor and the LLC have provided assistance to Diomed in
connection with the marketing and promotion of the lasers and optical fibers for
EVLT, all on the terms and conditions  set forth in the 2001  Agreement;  herein
set forth;

         WHEREAS, pursuant to the Purchase Agreement dated as of the date hereof
between the Doctor and Diomed (the "Purchase  Agreement"),  the Doctor  assigned
all his right,  title and interest in and to the Process Patent Rights to Diomed
in an assignment instrument (the "Assignment"); and

         WHEREAS,  the Doctor and the LLC, on the one hand,  and Diomed,  on the
other hand, wish to amend and restate the terms of the 2001 Agreement to reflect
their   relationship   going  forward  following  the  Patent   Assignment,   as
specifically set forth in this Agreement.

NOW,  THEREFORE,  good and valuable  consideration being extant, the receipt and
sufficiency of which the parties hereby acknowledge, the parties hereby agree as
follows:

I.       MARKETING OBLIGATIONS OF THE PARTIES

                  1.1  COVENANT TO PROMOTE THE PRODUCT FOR EVLT.  Subject to the
         terms and conditions of this Agreement,  Diomed, the Doctor and the LLC
         shall work together and use their  respective  commercially  reasonable
         best  efforts  to  promote  the  use  of the  Diomed  lasers  for  EVLT
         throughout the world during the Term (as hereinafter defined).

                  1.2  EXCLUSIVE  PROMOTION.  The Doctor and the LLC each agrees
         that,  during the Term (and  thereafter as provided in Section 5.4), he
         and it shall not actively promote to third parties any product for EVLT
         other than Diomed lasers, optical fibers and associated EVLT kits.

                  1.3 PATENT RIGHTS.

                  1.3.1    The Doctor and the LLC hereby  acknowledge  and agree
                           that  pursuant  to the  Purchase  Agreement  and  the
                           Assignment,  Diomed has acquired  from the Doctor all
                           of the Doctor's  undivided right,  title and interest
                           in and to the Process Patent  Rights.  The Doctor and
                           the LLC further covenant that they shall not become a
                           party to any  agreement  or  arrangement  (written or
                           oral)  with  any  other  co-inventor  of the  Process
                           Patent Rights or any third party that would adversely
                           affect the rights of Diomed under the  Assignment  or
                           the other rights granted to Diomed hereunder.

                  1.3.2    The Doctor and the LLC hereby  acknowledge  and agree
                           that  pursuant  to the  2001  Agreement,  the  Doctor
                           assigned,  granted, conveyed and transfered to Diomed
                           any and all right,  title and  interest he had or may
                           have had in and to the  Fiber  Patent,  and that this
                           Agreement  does not

                                       2
<PAGE>

                                 [LOGO] DIOMED

                           affect such  assignment or the other  obligations  of
                           the Doctor to Diomed in respect of the Fiber  Patent.
                           Specifically,  the Doctor will continue to, from time
                           to  time,   execute   and   deliver  to  Diomed  such
                           documentation and take such other reasonable  action,
                           at  Diomed's  expense,  which  Diomed may  request in
                           order  to  effectively  carry  out this  Section  and
                           invest in Diomed the Fiber Patent and title  thereto.
                           The Doctor  will  assist  Diomed in every  proper way
                           (but at Diomed's  expense) to obtain and from time to
                           time enforce  rights with respect to the Fiber Patent
                           in any  and  all  countries,  and  will  execute  all
                           documents  reasonably  necessary or  appropriate  for
                           this purpose.  The Doctor  further  acknowledges  and
                           agrees  that in the event  that  Diomed is unable for
                           any reason  whatsoever to secure the Doctor's consent
                           to any document  reasonably  necessary or appropriate
                           for  any  of  the  foregoing   purposes,   (including
                           renewals,  extensions,  continuations,  divisions  or
                           continuations in part), the Doctor hereby irrevocably
                           designate and appoint Diomed and its duly  authorized
                           officers  and  agents,  as his  exclusive  agents and
                           attorneys-in-fact  to act for and on his  behalf  and
                           instead  of him,  for the  purpose of  executing  and
                           filing any such document and doing all other lawfully
                           permitted acts to accomplish  the foregoing  purposes
                           with the same legal  force and effect as if  executed
                           by him.

                  1.3.3    The Doctor and the LLC hereby acknowledge that "EVLT"
                           is a trademark of Diomed, and that neither the Doctor
                           nor the LLC has any rights therein.

II.      DUTIES OF THE DOCTOR

         Subject to the terms and conditions of this Agreement, during the Term:

                  2.1 EVLT  TRAINING OF OTHER  PHYSICIANS.  The  Doctor,  acting
         through the LLC,  agrees to use his best  efforts to  personally  train
         other qualified  physicians,  as set forth in EXHIBIT B, and identified
         and approved by the President or the Director of Marketing of Diomed in
         the use of Diomed lasers for EVLT.  The Doctor will provide Diomed with
         a  certification  in the form  attached  hereto as  EXHIBIT A when each
         physician's training is complete.

                  2.2  PROMOTIONAL  ACTIVITIES.  The Doctor,  acting through the
         LLC, will use his  commercially  reasonable best efforts to perform the
         promotional  activities  set forth in  EXHIBIT  B, as  EXHIBIT B may be
         amended from time to time by written consent of Diomed and the Doctor.

                  2.3  CONFIDENTIALITY.  The Doctor and the LLC each acknowledge
         that  information  about  product sales to be provided by Diomed to the
         Doctor and the LLC hereunder and any other information  provided to the
         Doctor or the LLC and designated as  confidential by Diomed at the time
         of disclosure  constitute  confidential and proprietary  information of
         Diomed  and the  Doctor  and the LLC each agree that he and it will not
         use such  information  except in  furtherance  of the  purposes of this
         Agreement

                                       3
<PAGE>

                                 [LOGO] DIOMED

         and will hold such information in strict confidence. The obligations of
         the  Doctor and the LLC under  this  Section  2.3 shall be limited to a
         period  of  three  years  from  the  date  of   expiration  or  earlier
         termination  of this  Agreement.  Neither  the Doctor nor the LLC shall
         have any obligation of confidentiality  with respect to any information
         (a) in the public domain, other than by a breach of this Section 2.3 by
         either of them, (b) rightfully  received from a third party without any
         obligation of confidentiality, or (c) generally made available to third
         parties by Diomed without restriction on disclosure.

                  2.4 PERSONAL  OBLIGATION.  Notwithstanding the Doctor's use of
         the LLC to hold patent rights (prior to giving effect to the Assignment
         (in the case of the Process  Patent  Rights) and the  assignment of the
         Fiber  Patent  under  the  2001  Agreement  (in the  case of the  Fiber
         Patent)) and to provide services under this Agreement,  all obligations
         of the  Doctor  and the LLC  under  this  Agreement  shall be joint and
         several and such  obligations  may be fully  enforced by Diomed against
         either  the  Doctor or the LLC  should  the  other  party  breach  this
         Agreement.  Notwithstanding  anything to the contrary contained in this
         Agreement,  in no event shall the total  liability of the Doctor and/or
         the  LLC  for  damages  arising  out of the  2001  Agreement  and  this
         Agreement exceed the aggregate amount of consideration  received by the
         Doctor and/or the LLC (whether in cash, or exercised  options or shares
         of capital stock) under the 2001 Agreement and this Agreement (it being
         understood  that such  limitation  on liability  for damages  shall not
         limit Diomed's  ability to seek  injunctive or other  equitable  relief
         against  either the Doctor or the LLC in the event the Doctor  breaches
         his obligations under Sections 1.2, 1.3.1, 1.3.2, 1.3.3 or 2.3).

III.     OBLIGATIONS OF DIOMED

         Subject to the terms and conditions of this Agreement, during the Term,
Diomed agrees as follows:

                  3.1 PAYMENT FOR  TRAINING.  Within thirty (30) days of receipt
         of certification in the form of Exhibit A from the Doctor that training
         of physicians  pursuant to Section 2.1 has been completed,  Diomed will
         pay the LLC  [*CONFIDENTIAL  MATERIAL OMITTED AND FILED SEPARATELY WITH
         THE  SECURITIES  AND  EXCHANGE  COMMISSION  PURSUANT  TO A REQUEST  FOR
         CONFIDENTIAL  TREATMENT]  for each such approved  training  session per
         licensed physician.  Within thirty (30) days of submission of receipts,
         Diomed will reimburse up to  [*CONFIDENTIAL  MATERIAL OMITTED AND FILED
         SEPARATELY  WITH THE SECURITIES AND EXCHANGE  COMMISSION  PURSUANT TO A
         REQUEST   FOR   CONFIDENTIAL   TREATMENT]   for   foreign   travel  and
         [*CONFIDENTIAL   MATERIAL   OMITTED  AND  FILED   SEPARATELY  WITH  THE
         SECURITIES   AND  EXCHANGE   COMMISSION   PURSUANT  TO  A  REQUEST  FOR
         CONFIDENTIAL   TREATMENT]   for   domestic   travel  for   pre-approved
         lectures/workshops  where  discussion or presentation on EVLT is on the
         agenda.

                                       4
<PAGE>

                  3.2  PRODUCT  OPTIONS.  For each EVLT Laser (as defined in the
         Purchase  Agreement) sold by Diomed beginning on the Effective Date and
         ending  November 15, 2005,  Diomed will grant to the LLC under the Plan
         an option (a "Product  Option") to purchase  twenty five (25) shares of
         Common  Stock of Diomed up to an  aggregate  maximum of 180,000  shares
         (which number is inclusive of shares  subject to options  granted under
         the 2001 Agreement).  For purposes of the foregoing,  EVLT Lasers shall
         be  considered  "sold" on the date when Diomed has received  payment in
         full for such EVLT Lasers.  The Product  Options shall be granted as of
         the end of each  calendar  quarter  in  which  EVLT  Lasers  were  sold
         (subject to adjustment for returns and uncollected  accounts) and shall
         be fully vested on grant. The Product Options issued hereunder shall be
         subject to the same terms as the Product  Options  issued under Section
         3.6 of the 2001 Agreement.

IV.      INTENTIONALLY OMITTED

V.       TERM AND TERMINATION

                  5.1 TERM.  The  Agreement  shall be  effective  as of the date
         first set forth above (the  "Effective  Date") and shall  automatically
         terminate upon the  termination of the Purchase  Agreement  (whether by
         expiration  or  earlier   termination  of  the  Purchase  Agreement  in
         accordance  with the terms of the Purchase  Agreement),  unless earlier
         terminated  as  provided  under  this  Article V (the  period  from the
         Effective Date until  termination  of this Agreement  being referred to
         herein as the "Term").

                  5.2 TERMINATION FOR BREACH.  Diomed,  on the one hand, and the
         Doctor (on behalf of himself and the LLC), on the other,  may terminate
         this Agreement if the other defaults in the performance of any material
         agreement,  condition or covenant in this Agreement and this default is
         not remedied  within sixty (60) days after written demand to remedy the
         same has been given to the other  party.  For  purposes of this Section
         5.2,  failure by the Doctor to perform  his  agreed-upon  duties as set
         forth in EXHIBIT B shall  constitute a breach of this  Agreement.  Upon
         termination  for  default,  the  non-defaulting  party shall be free to
         pursue  any and all  remedies  available  to him or it.  No  remedy  is
         intended to be exclusive and each remedy shall be cumulative.

                  5.3  TERMINATION  UPON  DEATH OR  DISCONTINUATION  OF  MEDICAL
         PRACTICE OF THE DOCTOR; TERMINATION DUE TO INSUFFICIENT SALES ACTIVITY.

                  5.3.1 This Agreement  shall  automatically  terminate upon the
         death of the Doctor.

                  5.3.2  Diomed,  on the one hand,  and the Doctor (on behalf of
         himself and the LLC), on the other hand,  may terminate  this Agreement
         if  the  practice  of  medicine  ceases  to  be  the  Doctor's  primary
         professional  activity.  If Diomed  terminates  this  Agreement for the
         foregoing reason,  then,  notwithstanding  such  termination,  Diomed's
         obligation to provide Product  Options  pursuant to Section 3.2 of this
         Agreement  shall survive the  termination of this Agreement for so long
         as the Purchase Agreement remains in full force and effect.

                                       5
<PAGE>

                                 [LOGO] DIOMED

                  5.3.3  The  Doctor  (on  behalf  of  himself  and the LLC) may
         terminate this Agreement by giving not less than thirty (30) days prior
         written  notice to Diomed if in the  preceding  fiscal  year Diomed has
         sold less than  [*CONFIDENTIAL  MATERIAL  OMITTED AND FILED  SEPARATELY
         WITH THE SECURITIES AND EXCHANGE  COMMISSION  PURSUANT TO A REQUEST FOR
         CONFIDENTIAL TREATMENT] EVLT Lasers and [*CONFIDENTIAL MATERIAL OMITTED
         AND  FILED  SEPARATELY  WITH THE  SECURITIES  AND  EXCHANGE  COMMISSION
         PURSUANT TO A REQUEST FOR  CONFIDENTIAL  TREATMENT]  EVLT Kits (as such
         terms are defined in the Purchase Agreement).

                  5.4 SURVIVAL OF CERTAIN TERMS OF THIS AGREEMENT. Sections 2.3,
         6.2, 6.3 7.7 and 7.8 shall survive  termination  of this  Agreement and
         the Purchase Agreement, and Section 3.2 of this Agreement shall survive
         the termination of this Agreement under Section 5.3.2, if applicable.

                  5.5  SURVIVAL  OF  PURCHASE   AGREEMENT   AND   ASSIGNMENT  ON
         TERMINATION.  The  termination  of this  Agreement  shall  not have the
         effect  of  terminating  the  Purchase  Agreement,  which  may  only be
         terminated  in  accordance  with the terms of the  Purchase  Agreement.
         Accordingly,   the  obligations  of  the  parties  under  the  Purchase
         Agreement,  including without  limitation  Diomed's  obligation to make
         certain Variable Payments and provide certain  informational reports to
         the  Doctor  and the  LLC in  accordance  with  the  provisions  of the
         Purchase   Agreement,   shall   remain  in  full   force   and   effect
         notwithstanding  the  termination of this Agreement.  In addition,  the
         termination  of this Agreement  and/or the  termination of the Purchase
         Agreement shall not affect the assignment of the Fiber Patent to Diomed
         under  the  2001  Agreement  or  the  Assignment   under  the  Purchase
         Agreement, both of which shall remain in full force and effect.

VI.      REPRESENTATIONS, WARRANTS AND INDEMNIFICATION

                  6.1 AUTHORITY AND  ENFORCEMENT.  Each party to this  Agreement
         warrants  that he or it has full right,  power and  authority  to enter
         into  this  Agreement  and to  perform  the  covenants  and  agreements
         contemplated  hereby,  that this  Agreement  has been duly executed and
         delivered by him or it and that the  Agreement is  enforceable  against
         him or it in accordance with its terms, except as enforceability may be
         limited by bankruptcy,  insolvency or other creditors' rights generally
         and  the  availability  of  equitable   remedies,   including  specific
         performance.

                  6.2  PATENT  RIGHTS.  The  Doctor  and the LLC  represent  and
         warrant  that (i) the Doctor is a named and actual  co-inventor  of the
         Process  Patent  Rights,  (ii) the Doctor has  provided  Diomed with an
         accurate and  complete  copy of all written  documents  relating to the
         Process  Patent  Rights  that are in his  possession  or control  and a
         written  summary  of all other  agreements  and  arrangements  (whether
         written or oral)

                                       6
<PAGE>

                                 [LOGO] DIOMED

         relating to the Process  Patent Rights of which he has  knowledge,  and
         (iii)  neither  the Doctor nor the LLC is a party to any  agreement  or
         arrangement (whether written or oral) with any other co-inventor of the
         Process Patent Rights or any third party that would prohibit the Doctor
         from  granting  the  license  to  the  Process  Patent  Rights  granted
         hereunder or require the  approval or consent of any other  co-inventor
         or any third party to the grant of such license. The Doctor and the LLC
         further  represent  and warrant  that the Doctor is the inventor of the
         Fiber Patent and that he had the right to grant the rights to the Fiber
         Patent  under  the 2001  Agreement.  The  Doctor  and the LLC  agree to
         indemnify  and hold Diomed  harmless from any  liability,  loss or cost
         (including reasonable attorney's fees) arising out of or resulting from
         any breach of any  representation  or  warranty  in this  Section  6.2,
         subject to the limitation of liability set forth in Section 6.3.

                  6.3 LIMITATION ON LIABILITY.  EXCEPT AS SPECIFICALLY  PROVIDED
         HEREIN AND IN ANY WARRANTY DELIVERED WITH THE PRODUCT,  DIOMED GIVES NO
         WARRANTIES  WHATSOEVER WITH RESPECT TO THE PRODUCT  INCLUDING,  BUT NOT
         LIMITED TO, ANY IMPLIED  WARRANTY OF  MERCHANTABILITY  OR FITNESS FOR A
         PARTICULAR  PURPOSE.  IN NO EVENT  SHALL  DIOMED ON THE ONE HAND OR THE
         DOCTOR  AND/OR  THE LLC ON THE  OTHER BE  LIABLE  TO THE  OTHER FOR ANY
         INCIDENTAL,  CONSEQUENTIAL OR SPECIAL DAMAGES THAT THE OTHER MAY SUFFER
         DIRECTLY OR INDIRECTLY AS A RESULT OF THE SALE OF THE PRODUCT FOR EVLT.
         NOTWITHSTANDING  ANYTHING TO THE CONTRARY  CONTAINED IN THIS AGREEMENT,
         IN NO EVENT SHALL THE TOTAL  LIABILITY OF THE DOCTOR AND/OR THE LLC FOR
         DAMAGES  ARISING OUT OF THIS AGREEMENT  EXCEED THE AGGREGATE  AMOUNT OF
         CONSIDERATION  RECEIVED BY THE DOCTOR  AND/OR THE LLC (WHETHER IN CASH,
         OR EXERCISED OPTIONS OR SHARES OF CAPITAL STOCK) UNDER THIS AGREEMENT

VII.     MISCELLANEOUS

                  7.1 ASSIGNMENT. This Agreement shall be binding upon and inure
         to the  benefit  of the  parties  and to their  respective  successors,
         personal representatives,  executors or assigns. Neither this Agreement
         nor any part of it shall be  assignable by the Doctor or the LLC to any
         third party.  Diomed may assign this Agreement to a parent,  subsidiary
         or other  affiliate  and to any party that  acquires the EVLT  business
         from Diomed,  provided that such assignee  assumes the  obligations  of
         Diomed  hereunder  and  under  the  Purchase  Agreement  in  a  written
         instrument delivered to the Doctor and the LLC.

                  7.2 NOTICES.  Unless otherwise agreed in writing, all notices,
         requests and other  communications  pursuant to this Agreement shall be
         in writing and addressed as follows:

                                       7
<PAGE>

                                 [LOGO] DIOMED

                                    If to Diomed:

                                    Diomed, Inc.
                                    1 Dundee Park
                                    Andover, MA 01810
                                    Attn: James A. Wylie, Jr.

                                    If to the Doctor or the LLC:

                                    Endovenous Laser Associates, L.L.C.
                                    416 East 55/th/ Street New York, N.Y. 10022
                                    Attn: Robert Min, M.D.

           Any  notice or other  communication  under  this  Agreement  shall be
           deemed to be sufficiently given if made in writing addressed as above
           and  delivered  (a)  by  hand  or by  recognized  overnight  delivery
           service,  (b) by first class  registered  or certified  mail,  return
           receipt  requested,  or (c) by facsimile or  electronic  mail (with a
           confirmation  copy  dispatched as provided in  subsection  (a) or (b)
           above).  Notice  shall be deemed to have been given upon  delivery if
           delivered  under  subsection (a) or (c) and at the expiration of five
           (5)  business  days after the date on which a notice is posted  under
           subsection (b).

                  7.3  ENTIRE  AGREEMENT.  This  Agreement,  together  with  the
         Exhibits  attached hereto,  represents the entire agreement between the
         parties with respect to the subject  matter hereof and  supersedes  any
         other  agreement or  understanding,  written or oral,  that the parties
         heretofore  may have  had  with  respect  thereto,  PROVIDED,  that the
         provisions  of Paragraph 4 under "Other  Terms" and  Paragraphs 1 and 2
         under  "Standstill  Agreement"  under that certain Term Sheet signed by
         the parties and dated June 11, 2003 shall survive and not be superceded
         by this Agreement.

                  7.4  AMENDMENT.  No  amendment  or  other  variation  of  this
         Agreement  will be binding  unless duly  executed by an  instrument  in
         writing signed by the parties hereto.

                  7.5 NO WAIVER. Failure by any party to enforce the performance
         of any of the provisions of this Agreement  against another party shall
         neither constitute a waiver by it or him of its or his rights hereunder
         nor affect the  validity of this  Agreement in any way. Any waiver by a
         party hereto of a breach of this Agreement on the part of another party
         shall not  constitute  a precedent as to any  subsequent  breach on the
         part of such other party.

                  7.6  INVALIDITY.  In the  event  that  any  one or more of the
         provisions  contained in this Agreement  should be invalid,  illegal or
         unenforceable in any respect, the validity, legality and enforceability
         of the remaining  provisions  contained  herein shall not in any way be
         affected or impaired thereby.

                                       8
<PAGE>

                                 [LOGO] DIOMED

                  7.7 APPLICABLE  LAW. This  Agreement  shall be governed by the
         internal laws of the State of New York without  regards to conflicts of
         law principles.

                  7.8 DISPUTE RESOLUTION. Any dispute that may arise between the
         parties in  connection  with or  arising  out of this  Agreement  shall
         exclusively be subject to legal proceedings as set forth in Section 8.9
         of the Purchase Agreement.

                  7.9  COUNTERPARTS.  This  Agreement  may be executed in one or
         more counterparts, each of which shall be deemed to be an original, but
         all of which shall be considered one and the same instrument.

                  7.10 HEADINGS. The headings in this Agreement are inserted for
         convenience  only and shall not be used to interpret  this Agreement or
         for any other purpose.

         IN WITNESS WHEREOF,  the parties have executed this Agreement as of the
date first above written.

                                  DIOMED, INC.

                                  By:
                                     ----------------------------------------
                                  James A. Wylie, Jr.
                                  President and Chief Executive Officer

                                  -------------------------------
                                  Robert Min

                                  ENDOVENOUS LASER ASSOCIATES, L.L.C.

                                  By:
                                     ----------------------------
                                  Name:
                                  Title:

                                       9
<PAGE>

                                                                       EXHIBIT A

                  CERTIFICATION OF COMPLETION OF EVLT TRAINING

                            EVLT TRAINING CERTIFICATE

                        This document certifies that Dr.

                             Street: City:
                             ZIP, State: Phone:
                             e-mail:

has  successfully  completed a one day training  session on  performing  an EVLT
procedure.

         The Training was  performed by Dr.  Robert J. Min of  Endovenous  Laser
Associates,  L.L.C.,  a New York limited  liability  company,  at the  following
location:

                          Street:
                          City:
                          ZIP, State:
                          Phone:
                          e-mail:

         We thank you for your participation

         This  certificate  merely  certifies that the above named physician has
completed the training  session  described above, and does not certify that such
physician possesses any particular level of skill, competency or experience with
respect to an EVLT procedure.

<PAGE>

                                                                       EXHIBIT B
                                DUTIES OF DR. MIN

To train between 8 and 12 doctors per calendar year, subject to availability.

If requested by Diomed,  to speak and lecture on the use of the Product for EVLT
at a minimum of two major  medical  meetings  each  year,  at least one of which
shall be in an international forum.

To be available to answer questions from Diomed personnel related to EVLT for up
to five (5) hours per month during  normal  working  hours as agreed upon by the
parties  and  further  agrees  to  devote  up to three  (3)  hours  per month to
providing e-mail support with respect to EVLT as requested by Diomed.Exhibit 10.2

                                                               EXECUTION VERSION

                                LICENSE AGREEMENT

         THIS  AGREEMENT (the  "Agreement")  is made and entered into as of July
11, 2003, by and between:

         ENDOLASER  ASSOCIATES,  L.L.C.,  a Delaware limited  liability  company
having its principal  place of business at c/o Luis Navarro,  M.D. 327 East 65th
Street, New York, New York 10021(hereinafter referred to as the "Licensor"); and

         DIOMED,  INC., a Delaware  corporation  having its  principal  place of
business at One Dundee Park, Andover,  Massachusetts  (hereinafter together with
its Affiliates referred to as the "Licensee").

         WHEREAS,  Licensor is the owner of an undivided interest in U.S. Patent
No.  6,398,777  (the "`777  Patent")  entitled  "Endovascular  Laser  Device and
Treatment of Varicose Veins," and related patent rights relating to a device and
method for closing  veins using a laser,  having  acquired all right,  title and
interest therein from the Endolaser Inventors;

         WHEREAS,  Licensee has previously  acquired  exclusive  rights from Dr.
Robert  J.  Min,  an owner of an  undivided  interest  in the `777  Patent,  and
Licensee  desires to acquire an exclusive  license  under  Licensor's  undivided
interest  in the `777 Patent and  counterpart  patent  applications  in order to
secure all remaining rights in those Patents;

         NOW, THEREFORE,  in consideration of the promises and the covenants set
forth herein, Licensor and Licensee agree as follows:

         1. DEFINITIONS

         The following  definitions  shall apply in the  interpretation  of this
Agreement.

         1.1  "Affiliate"  of any company  means any  corporation  or individual
which, directly or indirectly,  controls or is controlled by, or is under direct
or indirect  common  control with,  such  company;  and for the purposes of this
definition "control" (including "control by" and "under common control with") as
used with  respect to any  corporation  or company,  shall mean the  possession,
directly or  indirectly,  of the power to direct or cause the  direction  of the
management and policies of such corporation or company, through the ownership of
more than 50% of the voting shares.

         1.2 "Calendar Quarter" means any of the respective  three-month periods
occurring  during the Term of this Agreement ending March 31, June 30, September
30, or December 31 in any year.

         1.3  "Effective  Date" shall mean the date of the  Agreement  set forth
above.

<PAGE>

         1.4  "Endolaser  Inventors"  shall mean each of Dr. Luis  Navarro,  Dr.
Nestor Navarro,  Dr. Carlos Bone Salat and Dr. Joaquina  Fructuoso  Gomez,  said
individuals  being all of the inventors  named in the `777 Patent other than Dr.
Robert J. Min.

         1.5  "EVLT  Kit"  shall  mean  a  package  of two  or  more  disposable
accessories for use in endovenous laser treatment using the Technology including
but not limited to optical fiber,  percutaneous needle,  guide wire,  introducer
sheath and/or other components;  provided,  however that a single such component
sold for use in a Licensed  Method shall also be deemed an EVLT Kit; and FURTHER
PROVIDED, that sales of optical fibers sold separately shall not be deemed to be
"EVLT Kits".

         1.6 "EVLT  Laser"  shall mean a laser for  endovenous  laser  treatment
using the Technology,  including,  but not limited to the 15 watt,  810nm Diomed
Diode laser or any equivalent  laser  developed or  substituted  for same in the
future for Licensee's  endovenous laser treatment  (EVLT(TM)) products using the
Technology;  PROVIDED,  that parts for repairing or services for repairing  EVLT
Lasers sold by Licensee shall not be deemed to be "EVLT Lasers."

         1.7 "EVLT Optical Fiber" shall mean optical fiber sold for use together
with an EVLT Kit or an EVLT Laser or otherwise for use in a Licensed Method.

         1.8 "Fixed  Payments"  shall mean the  payments  to be made to Licensor
pursuant to Section 5.1(a) and 5.1(b).

         1.9  "Funding   Date"  shall  mean  the  date  on  which  Licensee  has
consummated  one or more  financings  with one or more third  parties with gross
proceeds before expenses of at least Eight Million ($8,000,000.00) Dollars.

         1.10  "Improvement"   shall  mean  any  improvement,   modification  or
variation,  whether  or  not  patentable,  in or to  the  Technology,  which  is
developed by Licensor or any of the  Endolaser  Inventors,  whether now known to
them or developed after the Effective Date of this Agreement.

         1.11  "Interest  Rate" shall mean the prime rate,  as  published in THE
WALL STREET JOURNAL,  as the same shall be in effect from time to time, plus 200
basis points, divided by 360.

         1.12  "Interest  Factor" shall mean, for each Patent  Litigation  Cost,
Patent  Maintenance Cost or Patent  Prosecution Cost, and for each Fixed Payment
and royalty payment,  the amount of such cost,  expense or payment multiplied by
(x) the  Interest  Rate and (y) the  number  of days  elapsed  since the date of
payment of such cost,  expense or payment by or on behalf of the Licensee to the
person to whom such amount is due.

         1.13 "Licensed  Product" shall mean the EVLT Lasers,  the EVLT Kits and
any other product or part thereof,  including  EVLT Optical  Fibers,  for use in
endovenous laser treatment using the Technology;

         1.14  "Licensed  Method"  shall  mean any  method of  endovenous  laser
treatment using the Technology.

                                       2
<PAGE>

         1.15 "Licensed Territory" shall mean all the countries of the world and
their territories and possessions except Spain.

         1.16 "Licensee"  shall include its Affiliates and their  successors and
assigns.

         1.17 "Lump Sum" means a fixed amount of money,  whether  payable in one
or in more  than  one  installments,  not tied to  sales  or  other  measure  of
commercial activity.

         1.18 "Net Sales" shall mean the Receipts of Licensee or its  Successors
(but not the gross revenues of Sublicensees)  from the sale, lease,  transfer or
other  exploitation  of EVLT Lasers,  EVLT Kits or EVLT Optical Fibers after the
Funding Date to any person other than an Affiliate of Licensee,  Licensor or any
of the Endolaser  Inventors or to Dr.  Robert Min for his personal  professional
use, less, in each case, the following  reasonable and customary  charges to the
extent actually taken or paid by Licensee for:

                  (a)      transportation and insurance charges;

                  (b)      trade,   quantity,   case   promotional   and   other
                           discounts;

                  (c)      brokers' or agents  commissions  paid to  independent
                           parties in arms-length transactions;

                  (d)      credits  or  allowances   given  and  on  account  of
                           rejects, returns or retroactive price reductions;

                  (e)      taxes   or   governmental   charges   on  the   sale,
                           transportation, use, or delivery of EVLT Lasers, EVLT
                           Kits or EVLT Optical  Fibers and not  recovered  from
                           the purchaser; and

                  (f)      sales  commissions  to  independent  and direct sales
                           representatives arising from the sale of EVLT Lasers,
                           EVLT Kits or EVLT Optical Fibers.

All sales,  transfers  and other  transactions  between  Licensee and any of its
Affiliates  for  purposes  of the  direct or  indirect  resale or other  further
exploitation of EVLT Lasers, EVLT Kits or EVLT Optical Fibers to or with respect
to a Third Party shall be excluded from the  computation of Net Sales,  provided
that,   Net  Sales  shall  include  all  Receipts  from  such  resale  or  other
exploitation to or with respect to Third Parties other than Sublicensees  (which
shall be  governed  by  Section  5.7).  For the  avoidance  of  doubt,  sales or
transfers of EVLT Lasers, EVLT Kits or EVLT Optical Fiber to potential customers
or to independent sales representatives for demonstration  purposes shall not be
deemed to generate Net Sales.

         1.19 "OEM Sale" shall mean any sale of EVLT  Lasers,  EVLT Kits or EVLT
Optical  Fiber by  Licensee  to a purchaser  under an  agreement  where the EVLT
Lasers,  EVLT Kits or EVLT Optical Fiber are delivered  without  Licensee's logo
and the purchaser has the right to separately  brand the EVLT Lasers,  EVLT Kits
or EVLT  Optical  Fiber  with  its  own  name  or  logo  (or a name or logo  not
associated with Licensee or its Affiliates) and actually does so.

                                       3
<PAGE>

         1.20 "Patent Litigation Costs" shall mean, without duplication, any and
all costs and expenses  actually paid to commence and thereafter to maintain any
legal proceeding before a court, other tribunal or administrative  agency having
proper jurisdiction over the assertion of patent claims or rights or arbitration
against an alleged or actual  infringer under any of the Patents,  including the
defense of any claims of  invalidity  or misuse of any of the  Patents,  whether
asserted as a counterclaim in any such action or proceeding or in an independent
action  or  proceeding.   Patent  Litigation  Costs  shall  not  include  Patent
Maintenance Costs or Patent Prosecution Costs.

         1.21 "Patent  Maintenance Costs" shall mean, without  duplication,  all
costs and expenses  actually paid to maintain any of the Patents,  including any
taxes,  annuities,  working  fees,  maintenance  fees and renewal and  extension
charges with respect to any of the Patents.  Patent  Maintenance Costs shall not
include any Patent Prosecution Costs or Patent Litigation Costs.

         1.22 "Patent  Prosecution Costs" shall mean, without  duplication,  all
costs and  expenses  actually  paid to obtain the issuance of any of the Patents
based upon applications or other documents filed by Licensor or Licensee. Patent
Prosecution  Costs  shall  not  include  Patent   Maintenance  Costs  or  Patent
Litigation Costs.

         1.23 "Patents" shall mean all patents and patent applications set forth
on  ATTACHMENT  A,  both  foreign  and  domestic,   as  well  as  continuations,
continuations-in-part,  divisionals,  reexaminations,  reissues  and  extensions
thereof.

         1.24  "Receipts"  shall  mean  monies  or the  monetary  value of other
consideration to the extent actually received by Licensee.

         1.25 "Quarter"  shall mean each of the  three-month  periods  occurring
during the Term of this Agreement and ending on March 31, June 30,  September 30
and December 31; PROVIDED,  that if the Funding Date occurs on a date other than
the first day of a Quarter,  the initial Quarter shall be the period  commencing
on the  Funding  Date and  ending  on the last day of the  Quarter  in which the
Funding Date occurs.

         1.26  "Sublicensee"  shall  mean any  person or  entity,  other than an
Affiliate of Licensee or a distributor of Licensee,  that acquires from Licensee
any license or right to practice any of the Patents.

         1.27  "Technology"  shall mean any device or method covered by the '777
Patent and any Improvements.

         1.28 "Term" shall mean the period  commencing on the Effective Date and
ending on the  effective  date of  termination  of this  Agreement  pursuant  to
Article 6.

         1.29 "Third Party" shall mean any person or entity other than Licensor,
Licensee and Licensor's or Licensee's respective Affiliates.

         1.30  "United  States"  shall mean the United  States of  America,  its
commonwealths and possessions.

                                       4
<PAGE>

2.       GRANT OF LICENSE

         2.1 Subject to the terms and  conditions  of this  Agreement,  Licensor
hereby  grants to Licensee the exclusive  right and license to make,  have made,
use,  lease,  sell,  import  and export  Licensed  Products  and to perform  the
Licensed Methods and practice the Technology in the Licensed Territory,  and, to
grant  sublicenses  or  rights  to  practice  to do  the  same.  The  choice  of
Sublicensee(s)  and the terms and  conditions  of  sublicense(s)  and  rights to
practice  that  Licensee may grant under this  Agreement  shall be in Licensee's
sole discretion.

         2.2 Licensee will provide  Licensor with copies of all  sublicense  and
right to practice agreements within ten (10) business days of their execution by
Licensee and Sublicensee.

         2.3 Licensee shall and shall require its Sublicensee(s) to fully comply
with the patent marking  provisions of the applicable laws of those countries in
the  Licensed  Territory in which  Licensee or its  Sublicensees  sell  Licensed
Products or perform Licensed Methods.

3.       DILIGENCE

         3.1  Licensee  shall use  commercially  reasonable  efforts to actively
market and sell Licensed  Products  consistent with the practices of the medical
device industry in the United States and to enforce the Patents.

4.       PATENT PROSECUTION AND LITIGATION

         4.1  Licensee  shall be solely  responsible  for  prosecution,  foreign
filing and  maintenance  of the Patents in the Licensed  Territory and shall pay
all costs and expenses associated  therewith,  subject to recoupment as provided
below in this  Agreement.  Licensor  agrees to perform all such further acts and
execute all such further applications, documents and instruments relating to the
Patents and the prosecution and maintenance  thereof, in the Licensed Territory,
as  Licensee  may  from  time to time  reasonably  request  in order to file and
prosecute patent  applications and to obtain,  perfect,  provide evidence for or
protect the Patents and  Licensee's  rights  thereunder.  In  furtherance of the
foregoing,  Licensor  hereby  exclusively  appoints  Licensee  to  execute  such
applications,  documents and instruments in Licensor's name and on its behalf as
its duly  authorized  agent and  attorney-in-fact  and,  except as  provided  in
Section  4.3,  this  appointment  shall be deemed to be a power  coupled with an
interest and shall be  irrevocable  during the Term.  Licensee  shall confirm to
Licensor  upon  Licensor's  request,  no less  frequently  than  annually,  that
Licensee has duly paid all maintenance fees in connection with the Patents.

         4.2 All costs and expenses  incurred by Licensee in  furtherance of its
activities  under Section 4.1,  including  Patent  Maintenance  Costs and Patent
Prosecution Costs, shall be promptly paid by Licensee;  PROVIDED,  that Licensee
shall  have the right to recoup  Patent  Maintenance  Costs in  accordance  with
Section 5.8(a).

         4.3 Licensee  shall not take any action or omit to take any action that
could result in the  abandonment  of any Patent  without  providing  Licensor at
least sixty (60) days' prior written notice and  sufficient  opportunity to take
such steps as may be  necessary  to avoid  abandonment  of any such  Patent.  If
Licensee purports to take any such action or omits to take any such action,

                                       5
<PAGE>

and Licensor gives Licensee notice of its desire to avoid such  abandonment with
respect thereto, the appointment of Licensee as Licensor's duly authorized agent
and attorney-in-fact  pursuant to Section 4.1 shall be deemed revoked as to such
Patent from and after the date of such notice by Licensor to Licensee.

         4.4  Licensor  shall not take any action or omit any action which could
result in the  abandonment  of any Patent  without  providing  Licensee at least
sixty (60) days' prior written  notice and  sufficient  opportunity to take such
steps as may be necessary to avoid abandonment of any Patent.

         4.5 If any action alleging invalidity or non-infringement of any of the
Patents is brought by a third party against Licensor or any Endolaser  Inventor,
Licensor  shall provide  notice  thereof to Licensee and Licensee shall have the
right to  intervene  and take over the sole  defense of the action and to assert
claims on  behalf of  Licensor  and  Licensee  at its own  expense,  subject  to
Licensor's  obligation to indemnify  under Section 7.5.  Licensor  shall provide
Licensee  written  notice of any such claim,  proceeding  or suit as promptly as
practicable but in no event later than ten (10) days after Licensor's receipt of
notice thereof.

         4.6 (a) Licensor  will promptly  inform  Licensee of any act by a Third
Party  which  it  believes  is an  infringement  of a  Patent  in  the  Licensed
Territory.

              (b)  Licensee  shall have the sole right to enforce the Patents in
the Licensed  Territory and to settle and/or  litigate the matter with the Third
Party infringer.

              (c) If  Licensee  chooses  to enforce  any Patent  against a third
party  infringer,  by commencement  and  maintenance of an infringement  action,
Licensee shall pay all Patent  Litigation  Costs. Any monetary recovery (whether
by  settlement,  award or  judgment)  received  by  Licensee  as a result  of an
infringement  claim or counterclaim  by Licensee  against a Third Party shall be
allocated as follows:

                           First,  to  Licensee  until  an  amount  equal to all
                  Patent Litigation Costs, together with the applicable Interest
                  Factors thereon, has been recouped in full; and

                           Second,  as to  all  amounts  of  any  such  monetary
                  recovery  that are  allocable  on the basis of date of sale or
                  other  transfer  to the period of time up to and  through  the
                  Funding  Date,   [*CONFIDENTIAL  MATERIAL  OMITTED  AND  FILED
                  SEPARATELY   WITH  THE  SECURITIES  AND  EXCHANGE   COMMISSION
                  PURSUANT  TO A REQUEST  FOR  CONFIDENTIAL  TREATMENT]  of such
                  amounts shall be retained by Licensee; and

                           Third,  as  to  all  amounts  of  any  such  monetary
                  recovery  that are  allocable  on the basis of date of sale or
                  other  transfer to the period of time after the Funding  Date,
                  such  amounts   shall  be  paid  to  Licensor  and   Licensee,
                  respectively,  as if any such  amount  that is a fixed  amount
                  were a Lump  Sum  payment  from  a  Sublicensee  and as if any
                  future royalties or similar contingent  payments  constituting
                  part of the  recovery  or  settlement  were  royalties  from a
                  Sublicensee, all as provided in Section 5.7.

                                       6
<PAGE>

              (d) Licensor and the Endolaser  Inventors  consent to being joined
in the  action as  interested  parties,  and will  perform  all acts  reasonably
necessary to assist in said  enforcement  at Licensee's  expense.  Licensor will
charge Licensee no more than $3,500 per day for the services of Dr. Luis Navarro
plus  all his  reasonable  travel  expenses  in  connection  with  such  action.
Endolaser  will charge no more than  $1,000 per day for the  services of each of
the  other  Endolaser   Inventors  plus  their  reasonable  travel  expenses  in
connection with such action, which travel expenses shall be subject to the prior
written  consent of Licensee if they exceed $500.00 in any one instance,  not to
be  unreasonably  withheld.  Licensor  shall  maintain and make  available  upon
Licensee's or its attorneys request all relevant records,  papers,  information,
samples, and the like relating to the Patents.

5.       PAYMENT PROVISIONS AND REPORTING OBLIGATIONS

         As complete consideration in respect of payments for the rights granted
by Licensor to Licensee hereunder,  Licensee will make the following payments to
Licensor:

         5.1 (a)  Licensee  shall  pay to  Licensor  One  Million  Five  Hundred
Thousand  Dollars  ($1,500,000.00)  upon the  earlier to occur of three (3) days
after (i) the Funding Date, and (ii) September 15, 2003.

              (b) Licensee shall make ten quarterly  payments to Licensor of Two
Hundred Fifty Thousand Dollars ($250,000) each on the first business day of each
of the ten (10) Quarters following the Quarter in which the Funding Date occurs,
until such quarterly  payments total Two Million Five Hundred  Thousand  Dollars
($2,500,000.00).  For the  avoidance of doubt,  if the Funding Date occurs on or
prior to September 15, 2003,  the first  quarterly  payment  referred to in this
Section will be payable on October 1, 2003.

         5.2 After  satisfaction  of the  conditions  that the Funding  Date has
occurred and that the amount  payable  under  Section  5.1(a) has become due and
payable,  Licensee's  payment  obligation under Section 5.1(b) shall be absolute
and  irrevocable and the payments set forth in Section 5.1(b) shall be guarantee
payments of Licensee not subject to any  abatement,  set-off or  recoupment  and
shall be payable to Licensor irrespective of the abandonment or lapse of any one
or more of the Patents,  any determination by a court of competent  jurisdiction
that any Patent is invalid or unenforceable and any termination of the Agreement
pursuant to Article 6.

         5.3 Subject to Section 5.8,  Licensee  shall pay Licensor  royalties of
[*CONFIDENTIAL  MATERIAL  OMITTED AND FILED  SEPARATELY  WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] percent on
Net Sales of EVLT  Lasers  sold for  delivery  in the  United  States  after the
Funding Date.

         5.4 Subject to Section 5.8,  Licensee  shall pay Licensor  royalties on
Net Sales of EVLT Kits sold for delivery in the United  States after the Funding
Date according to the following schedule:

                                       7
<PAGE>

         Cumulative Net Sales of EVLT Kits Sold for
           DELIVERY IN THE U.S., PER QUARTER                    ROYALTY RATE

[*CONFIDENTIAL  MATERIAL  OMITTED AND FILED  SEPARATELY  WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

         5.5  (a)  Subject  to  Section  5.8,  Licensee  shall  pay to  Licensor
royalties  of  [*CONFIDENTIAL  MATERIAL  OMITTED AND FILED  SEPARATELY  WITH THE
SECURITIES  AND  EXCHANGE  COMMISSION  PURSUANT  TO A REQUEST  FOR  CONFIDENTIAL
TREATMENT]  percent on Net Sales of EVLT Lasers sold for delivery outside of the
United States after the Funding Date.

              (b)  Subject  to  Section  5.8,  Licensee  shall  pay to  Licensor
royalties  on Net Sales of EVLT Kits sold for  delivery  outside  of the  United
States after the Funding Date according to the following schedule:

         Cumulative Net Sales of EVLT Kits Sold for
           DELIVERY OUTSIDE THE U.S., PER QUARTER               ROYALTY RATE

[*CONFIDENTIAL  MATERIAL  OMITTED AND FILED  SEPARATELY  WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

(c)  Subject  to  Section  5.8,  Licensee  shall pay to  Licensor  royalties  of
[*CONFIDENTIAL  MATERIAL  OMITTED AND FILED  SEPARATELY  WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] percent on
Net Sales of OEM EVLT Lasers after the Funding Date.

(d) Subject to Section  5.8,  Licensee  shall pay to Licensor  royalties  on Net
Sales of OEM EVLT  kits  after  the  Funding  Date  according  to the  following
schedule:

         CUMULATIVE NET SALES OF OEM EVLT KITS, PER QUARTER     ROYALTY RATE

[*CONFIDENTIAL  MATERIAL  OMITTED AND FILED  SEPARATELY  WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

         5.6   Subject  to  Section   5.8,   Licensee   shall  pay  to  Licensor
[*CONFIDENTIAL  MATERIAL  OMITTED AND FILED  SEPARATELY  WITH THE SECURITIES AND
EXCHANGE COMMISSION PURUSANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] percent of
the Net Sales of EVLT  Optical  Fiber in any  Quarter  after the  Funding  Date;
provided,  however,  that  notwithstanding  the  foregoing,  the royalty on EVLT
Optical Fiber sold by Licensee in an OEM Sale shall be at the rates set forth in
Section 5.5(d).

                                       8
<PAGE>

         5.7 Licensee shall pay to Licensor  [*CONFIDENTIAL MATERIAL OMITTED AND
FILED  SEPARATELY  WITH THE  SECURITIES  AND EXCHANGE  COMMISSION  PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT] percent of all payments received in the form
of Lump Sum payments from Sublicensees after the Funding Date and Licensee shall
pay to Licensor  [*CONFIDENTIAL  MATERIAL  OMITTED AND FILED SEPARATELY WITH THE
SECURITIES  AND  EXCHANGE  COMMISSION  PURSUANT  TO A REQUEST  FOR  CONFIDENTIAL
TREATMENT]  percent of all royalties received from Sublicensees on Sublicensees'
sales of EVLT Lasers,  EVLT Kits and EVLT  Optical  Fiber made after the Funding
Date.

         5.8 The payments provided for in Section 5.3 through 5.7 are subject to
the following:

              (a) Licensee may deduct on an ongoing  basis from any payments due
under Section 5.3 through 5.7 all Patent Maintenance Costs.

              (b)  After  such  time  as  Licensee  has  paid  to  Licensor  the
cumulative amount of  [*CONFIDENTIAL  MATERIAL OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE  COMMISSION  PURSUANT TO A REQUEST FOR  CONFIDENTIAL
TREATMENT]  (including  all Fixed Payments and all royalties paid under Sections
5.3 through  5.7),  the  royalties set forth in Sections 5.3 through 5.6 and the
allocation of  Sublicensees'  Lump Sum payments and royalties  under Section 5.7
shall be reduced by  [*CONFIDENTIAL  MATERIAL  OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE  COMMISSION  PURSUANT TO A REQUEST FOR  CONFIDENTIAL
TREATMENT],  beginning  as of the first day of the Quarter in which such amounts
have been cumulatively paid.

              (c) In  the  event  that  the  `777  Patent  is  held  invalid  or
unenforceable  by a court of competent  jurisdiction,  which holding has not and
cannot be further appealed, royalties on sales by Licensee or its Sublicensee in
the United  States on and after the date of such holding  shall cease to accrue.
Royalties  accrued  before  the date of said  holding  shall  remain  payable as
provided in this  Agreement.  Licensor and Licensee  agree that for their mutual
convenience   all  royalties  on  foreign   sales  shall   continue  to  accrue,
irrespective of a holding that the `777 Patent is held invalid or unenforceable,
subject to Sections 5.8(d) and 5.8(e).  Notwithstanding the foregoing, if at the
date of said  holding,  no Patents  other than the `777 Patent had been  issued,
then from and after the date of such  holding all  royalties on sales after that
date by Licensee or its  Sublicensees  anywhere in the Licensed  Territory shall
cease to accrue or be payable. Royalties accrued before the date of such holding
shall remain payable as provided in this Agreement.

              (d) In the event  any one or more of the  Patents  other  than the
`777  Patent  is  held  invalid  or   unenforceable  by  a  court  of  competent
jurisdiction, which holding has not and cannot be further appealed, royalties on
sales on and after the date of such  holding by Licensee or its  Sublicensee  in
the territories in which such invalidated or  unenforceable  Patents had been in
effect shall cease to accrue or be payable. Royalties accrued before the date of
said  holding in the  territories  in which such  invalidated  or  unenforceable
Patents had been in effect shall  accrue and remain  payable as provided in this
Agreement.

                                       9
<PAGE>

              (e) In the  event  that all of the  Patents  are held  invalid  or
unenforceable by a court of competent jurisdiction,  which holdings have not and
cannot  be  further  appealed,  all  royalties  on  sales  by  Licensee  or  its
Sublicensee anywhere in the world on and after the date of the last such holding
shall  cease to  accrue.  Royalties  accrued  before  the date of the last  such
holding shall accrue and remain payable as provided in this Agreement.

         5.9  (a)  Licensee  will  keep  good  and  accurate  books  of  account
sufficient to permit  determination of the royalties due hereunder and will make
such books of account  for the then prior three  calendar  years  available  for
inspection by an  independent  certified  accountant  designated and retained by
Licensor and  reasonably  acceptable  to  Licensee.  Such  inspections  shall be
conducted no more frequently than once each calendar year during the term hereof
and once within six months after  termination  or expiration of this  Agreement.
The designated accountant will retain in confidence the information in the books
of  account  and may  report to  Licensor  the  accuracy  or  inaccuracy  of the
royalties paid hereunder. In the event that said accountant reports a deficiency
in the amount of the royalties  previously paid, Licensee will remit the overdue
balance  and  interest as set forth in Section  5.11 within  thirty (30) days of
notice thereof and in the event that such  deficiency  exceeds ten percent (10%)
of the royalties previously paid, Licensee will reimburse Licensor for the costs
of the audit.

              (b)  Notwithstanding  the  foregoing,  to the extent that any EVLT
Lasers sold are lasers intended both for use in a Licensed Method and for one or
more other uses, then the amount on which royalties shall be determined shall be
the Licensee's or Sublicensee's actual Net Sales of such EVLT Lasers.

         5.10 Licensee shall,  within forty five (45) days after the end of each
Calendar  Quarter,  deliver to Licensor true and accurate reports  pertaining to
its Net Sales and Receipts  from  Sublicensees  which shall include at least the
following information to permit Licensor to calculate its royalty entitlements:

              (i) with respect to Licensee's Net Sales:

                  First,  the  identity  of each  model or part  number  of EVLT
         Lasers and EVLT Kits sold;

                  Second,  the number of units of EVLT  Lasers and EVLT Kits (by
         model or part number) sold;

                  Third,  Net Sales of EVLT Lasers and EVLT Kits for delivery in
         the  United  States and  outside  the United  States,  delineated  on a
         branded and OEM basis;

                  Fourth, Net Sales of EVLT Optical Fiber;

                  Fifth, all deductions from Licensees'  Receipts in calculating
         Net Sales; and

                  Sixth,  total royalties payable to Licensor from Licensee's or
         its Affiliates' Net Sales; and

                                       10
<PAGE>

         (ii) with respect to Licensee's Receipts from Sublicensees:

                  First, names and addresses of all Sublicensees of Licensee;

                  Second,  Net  Sales  of EVLT  Lasers  and  EVLT  Kits and EVLT
         Optical Fiber by all Sublicensees for delivery in the United States and
         outside the United States;

                  Third, Lump Sums received from each Sublicensee;

                  Fourth, royalties received from each Sublicensee;

                  Fifth, Licensor's percentage share of Lump Sums; and

                  Sixth, Licensor's percentage share of royalties.

PROVIDED,  that with  respect  to sales of EVLT  Lasers  made  other than in the
United States to third parties by  Sublicensees,  distributors  and sales agents
where  Licensee  does not know the  intended use of the product  sold,  Licensee
shall report such sales in the Quarter in which Licensee  actually is made aware
of the intended use of the product sold,  but in no event later than the Quarter
following the Quarter during which such sale occurs.

         5.11 With each report submitted under Section 5.10,  Licensee shall pay
to Licensor the royalties and other  payments due and payable under this Article
5. If no royalties are due,  Licensee shall so report.  Payments not made timely
shall be made together with the applicable Interest Factors.

         5.12 (a) All payments due Licensor based on sales in countries  outside
the United States shall accrue in the currency of the country in which the sales
are invoiced. For purposes of this Agreement,  sales in countries outside of the
United States shall mean sales of EVLT Lasers,  EVLT Kits or EVLT Optical Fibers
which are shipped to the purchaser  for use in a location  outside of the United
States,  regardless of the place the sale  actually  occurs or is deemed to have
occurred for any other  purpose.  Payments to Licensor of royalties  for foreign
sales shall be in U.S.  dollars  calculated  on the basis of  currency  exchange
rates in effect  and  published  by the Wall  Street  Journal  as of the date of
Licensee's  actual  collection  of the  underlying  proceeds  of foreign  sales.
Licensee will not be responsible for any loss of exchange value, taxes, or other
expenses  incurred in the transfer or conversion  of foreign  currency into U.S.
Dollars or for any  income,  remittance  or other  taxes on  royalties  that are
required to be withheld at the source.  All  payments  shall be made by check or
wire  transfer to one or more bank  accounts  of Licensor  located in the United
States to be designated in writing by Licensor.

              (b) Whenever currency  regulations of a country in which sales are
made prohibit the deposit or payment of royalties to Licensor or its nominee, no
royalty  payment shall be due and payable by Licensee with respect to such sales
for so long as such restrictions prevail.

         5.13 Not more than once in any  calendar  year  during the Term of this
Agreement,  Licensor  may  request,  in  writing,  from  Licensee  a list of all
Licensed  Products  then being  sold by  Licensee.  Licensee  will  provide  the
requested information within thirty (30) days after receipt of the request.

                                       11
<PAGE>

6.       TERMINATION

         6.1 Unless earlier terminated as hereinafter  provided,  this Agreement
shall remain in full force and effect until the last of the Patent(s) shall have
expired or be held invalid by a court of competent  jurisdiction,  which holding
is not or cannot be further appealed.

         6.2 (a) Licensor may terminate  this  Agreement  upon thirty (30) days'
notice to Licensee if Licensee  fails to pay any sum falling due under  Sections
5.1  through  5.7 and  Licensee  fails to cure the  default  within  said notice
period.

             (b) Licensor may terminate  this  Agreement  upon sixty (60) days'
notice  Licensee if  Licensee  fails to timely  provide  the  royalty  report(s)
specified  in Section  5.10 and fails to cure the  default  within  said  notice
period.

         6.3 (a) Either  party may  terminate  this  Agreement  forthwith if the
other party  files a petition  in  bankruptcy  or is  adjudicated  a bankrupt or
insolvent, or makes an assignment for the benefit of creditors or an arrangement
pursuant to any bankruptcy law, or if the other party  discontinues or dissolves
its business or if a receiver is appointed  for the other party or for the other
party's  business and such receiver is not discharged  within one hundred eighty
(180) days;  or if an  encumbrance  holder  takes  possession,  or a receiver is
appointed, of any of the property or assets of the other party.

              (b) Either  party may  terminate  this  Agreement  effective  upon
ninety (90) days'  written  notice to the other party if the other party commits
any material breach of its obligations  under this Agreement,  other than in the
cases  specified  in Section 6.2,  and, if the breach is capable of remedy,  the
other party has failed to remedy the same within said notice period.

         6.4 No relaxation,  forbearance, delay or indulgence by either party in
enforcing  any of the terms of this  Agreement or the granting of time by either
party to the other shall prejudice,  affect or restrict the rights and powers of
the former  hereunder  nor shall any waiver by either  party of a breach of this
Agreement be considered as a waiver of any subsequent  breach of the same or any
other provision hereof.

         6.5 The rights to terminate this  Agreement  given by this clause shall
not prejudice any other right or remedy of either party in respect of the breach
concerned, if any, or any other breach.

7.       REPRESENTATIONS, WARRANTIES AND COVENANTS; INDEMNIFICATION

         7.1  (a) As of the  Effective  Date,  Licensor  represents  that to its
actual  knowledge and the actual knowledge of the Endolaser  Inventors,  (i) the
Technology  does not infringe any patent of any person,  firm,  or company,  and
(ii) there is no pending or threatened  litigation  challenging  the validity or
ownership of the Patents.

                                       12
<PAGE>

              (b) Licensor  represents  that it is a limited  liability  company
duly formed and validly existing under the laws of the State of Delaware.

              (c) Licensee  represents that it is a corporation  duly formed and
validly existing under the laws of the State of Delaware.

              (d) Each of Licensor  and  Licensee  warrant and  represent it has
taken all  necessary  action to approve  this  Agreement  and to  authorize  the
respective  officers of Licensor and Licensee to execute this Agreement and such
further  documents  as are  necessary  and  proper to  consummate  the terms and
provisions of this  Agreement.  Upon the execution  hereof,  this Agreement will
constitute  the valid and legally  binding  obligation of Licensor and Licensee,
enforceable in accordance with its terms.

              (e) Licensor  represents  and warrants  that there is no undivided
interest in the Patents other than the undivided interest in the Patents that it
owns and such  undivided  interest as was  originally  owned by Dr.  Robert Min.
Licensor  owns its  undivided  interest in and to the Patents via an  assignment
from the Endolaser Inventors, without the right of rescission, free and clear of
all licenses, liens, security interests, charges, encumbrances and other adverse
claims,  and has all right and  authority  to grant to Licensee the licenses set
forth herein. Licensor further represents and warrants that it has accounted for
all payments and pecuniary  obligations of any kind owed to any of the Endolaser
Inventors  and that none of the  Endolaser  Inventors  has or shall have a claim
against  Licensee  related to any of the Fixed Payments or royalties  payable by
Licensee hereunder. In furtherance of the foregoing, Licensor shall procure from
the Endolaser  Inventors and provide to Licensee prior to the Funding Date, as a
condition to Licensee's  obligation to make the payment required by Section 5.1,
originally-executed  counterparts  of the letter of  acknowledgment  in the form
attached hereto as ATTACHMENT B.

              (f) Licensor  represents  and warrants  that the sole  business of
Licensor is, and since the date of its  formation  has been, to hold and exploit
the  interests  of the  Endolaser  Inventors  in the Patents  through  licensing
arrangements  and  that  during  the  Term,  Licensor  will not  enter  into any
transactions  or business other than as heretofore  conducted and will not incur
any indebtedness for borrowed money in excess of $50,000.

              (g) Licensee  acknowledges  that it has, prior to its execution of
this Agreement, reviewed and evaluated the Patents.

         7.2 EXCEPT AS EXPRESSLY SET FORTH IN SECTION 7.1, THE PARTIES  DISCLAIM
ALL REPRESENTATIONS AND WARRANTIES  WHATSOEVER,  EXPRESS OR IMPLIED, BY STATUTE,
OPERATION OF LAW OR OTHERWISE,  WHETHER  WRITTEN OR ORAL, OR ARISING FROM COURSE
OF   PERFORMANCE,   COURSE  OF  DEALING  OR  USAGE  OF  TRADE,   INCLUDING   ANY
REPRESENTATIONS  OR WARRANTIES AS TO MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.

         7.3 Except as set forth in Section 7.1, nothing in this Agreement shall
be construed as:

              (a) a warranty or  representation  by Licensor as to the validity,
enforceability or scope of any Patent; or

                                       13
<PAGE>

              (b) a warranty or  representation  by Licensor that anything made,
used,  sold, or otherwise  disposed of pursuant to this Agreement by Licensee is
or will be free from infringement of patents or other intangible rights of Third
Parties; or

              (c) an  obligation  of Licensor to bring or  prosecute  actions or
suits against Third Parties for infringement of any Patent; or

              (d) an  obligation  of Licensor to furnish  any  manufacturing  or
technical assistance or information.

         7.4 Licensor assumes no  responsibilities  whatever with respect to the
manufacture,  use, sale or other disposition by Licensee,  its Sublicensee(s) or
their customers of any Licensed Product.

         7.5 Licensor shall indemnify, defend and hold harmless Licensee and its
Sublicensees and their respective directors, officers, employees and agents from
and  against  any and all  liabilities,  damages,  losses,  costs  and  expenses
(including reasonable attorneys fees and professional fees and other expenses of
litigation  and/or  arbitration)  resulting  from or  arising  out a  breach  by
Licensor of any of its representations or warranties made in Section 7.1.

         7.6 Licensee shall indemnify, defend and hold harmless Licensor and its
respective  directors,  officers,  employees and agents the Endolaser  Inventors
from and against any and all liabilities,  damages,  losses,  costs and expenses
(including reasonable attorneys fees and professional fees and other expenses of
litigation  and/or  arbitration)  resulting  from or  arising  out a  breach  by
Licensee of any of its representations or warranties made in Section 7.1.

         7.7 Licensee shall indemnify, defend and hold harmless Licensor and its
directors,  officers,  employees,  agents  and  consultants  and  the  Endolaser
Inventors  (each  an  "Endolaser  Indemnitee")  from  and  against  any  and all
liabilities,   damages,   losses,  costs  and  expenses  (including   reasonable
attorneys'  and  professional  fees and  other  expenses  of  litigation  and/or
arbitration)  resulting  from or  arising  out of a  claim,  suit or  proceeding
brought by a third party against an Endolaser  Indemnittee for personal  injury,
death,  product  liability or property  damage arising out of or relating to the
manufacture,  use, sale or other disposition of Licensed Products or practice of
Licensed Methods;  PROVIDED, that this Section 7.6 shall not require Licensee to
indemnify,  defend or hold harmless  Licensor or any of the Endolaser  Inventors
with respect to any liabilities,  damages, losses, costs or expenses arising out
of the rendering of professional services by the Endolaser Inventors.

8.       MISCELLANEOUS

         8.1 Nothing in this Agreement shall create,  or be deemed to create,  a
partnership,  joint  venture,  employment or the  relationship  of principal and
agent, between the parties.

         8.2 Licensee may assign this  Agreement to any of its  Affiliates or to
any third party taking over  substantially all the business of Licensee relating
to the Technology, provided that Licensee shall remain responsible for, and such
assignee shall assume in writing,  Licensee's obligations  hereunder.  Any other
assignment of this Agreement by Licensee shall require

                                       14
<PAGE>

Licensor's  prior written  consent,  which shall not be  unreasonably  withheld;
PROVIDED,  that the merger or consolidation of Licensee,  a change in control of
Licensee or the sale of all or substantially all of the assets of Licensee shall
not be  deemed an  assignment  of this  Agreement  and  shall  not  require  the
Licensor's consent or approval.  Licensee may grant a security interest, lien or
mortgage in this Agreement without Licensor's consent or approval.

         8.3 Licensor may assign this  Agreement to any  Affiliate or to any one
or more of the  Endolaser  Inventors  without  the prior  consent  of  Licensee;
PROVIDED,  that the Endolaser  Inventors shall assume in writing the obligations
of Licensor hereunder.  Any other assignment of this Agreement by Licensor shall
require  Licensee's  prior  written  consent,  which  shall not be  unreasonably
withheld;  PROVIDED,  that,  subject to the  following  sentence,  the merger or
consolidation of Licensor, a change in control of Licensor or the sale of all or
substantially all of the assets of Licensor shall not be deemed an assignment of
this   Agreement  and  shall  not  require   Licensee's   consent  or  approval.
Notwithstanding  the  foregoing,  however,  Licensee  shall retain all rights to
consent or to withhold its consent,  in its sole discretion,  whether reasonably
or  unreasonably  exercised,  to any  assignment or transfer,  whether direct or
indirect and whether by merger, consolidation, change in control, sale of all or
substantially  all of the assets of Licensor or otherwise,  as a result of which
any entity that  manufactures or markets medical devices  anywhere in the world,
or an entity that owns, directly or indirectly,  any entity that manufactures or
markets medical devices anywhere in the world,  succeeds to any of the rights of
Licensor under this Agreement.

         8.4 For the  purposes  of this  Agreement,  "Force  Majeure"  means any
circumstances  beyond the reasonable control of either party including,  without
limitation,  any strike, lock-out, or other form of industrial action. If either
party is affected by Force Majeure, it shall forthwith notify the other party of
the nature and extent  thereof.  Except with respect to the  performance  of any
payment obligation  hereunder,  neither party shall be deemed to be in breach of
this  Agreement,  or otherwise be liable to the other, by reason of any delay in
performance,  or the  non-performance,  of any of  its  obligations  under  this
Agreement,  to the extent that such delay or non-performance is due to any Force
Majeure of which it has notified the other party,  and the time for  performance
of that  obligation  shall be  extended  accordingly.  If the Force  Majeure  in
question  prevails  for a  continuous  period in excess of six (6)  months,  the
parties shall enter into bona fide  discussions  with a view to alleviating  its
effects,  or to agreeing upon such  alternative  arrangements as may be fair and
reasonable.

         8.5 Any  notice  required  or  permitted  hereunder  shall  be given in
writing  (unless  otherwise  specified  herein) and shall be deemed  effectively
given on the earliest of:

                  (i) the date delivered, if delivered by personal delivery with
written acknowledgement of receipt, or, by confirmed facsimile transmission;

                  (ii) the seventh business day after deposit,  postage prepaid,
in the United States Postal Service by registered or certified mail; or

                  (iii) the third business day after mailing by next-day express
courier,  with delivery costs and fees prepaid, in each case,  addressed to each
of the other parties thereunto

                                       15
<PAGE>

entitled at the following  addresses  (or at such other  addresses as such party
may designate by ten (10) days' advance  written notice  similarly given to each
of the other parties hereto):

LICENSEE:                  Diomed, Inc.
                           One Dundee Park
                           Andover, MA  01810
                           Attn:  President and Chief Executive Officer
                           Telecopier No.:  978-475-8488

                           With a copy to:
                           McGuireWoods LLP
                           9 West 57th Street, Suite #1620
                           New York, New York  10019
                           Attn:  William A. Newman
                           Telecopier No.:  212-548-2150

LICENSOR:                  Endolaser Associates, L.L.C.
                           c/o Luis Navarro, M.D.
                           327 East 65th Street
                           New York, New York 10021
                           Telecopier No.  212-517-5630

                           With a copy to:
                           Kramer Levin Naftalis & Frankel LLP
                           919 Third Avenue
                           New York, New York 10022
                           Attn:  Barry Evans, Esq.
                           Telecopier No.  212-715-8364

         8.6  This  Agreement   contains  the  entire  and  only  agreement  and
understanding  between the parties and  supersedes  all  preexisting  agreements
between them respecting its subject matter;  provided that,  consistent with the
terms of the Term Sheet  executed  by the  parties on June 9, 2003 (i)  Licensor
will not  discuss  the sale or  licensing  of the  Patents  with any Third Party
during the Term of this  Agreement,  and (ii)  promptly  upon  execution of this
Agreement,  Licensee will take all  reasonable  steps to secure  financing of at
least $8 million before expenses before September 15, 2003. Any  representation,
promise or condition in  connection  with the subject  matter of this  Agreement
which is not  incorporated  in this  Agreement  shall not be  binding  on either
party.

         8.7 No modification,  renewal, extension, waiver, and no termination of
this Agreement or any of its provisions  shall be binding upon the party against
whom enforcement of such modification, renewal, extension, waiver or termination
is sought,  unless  made in writing and signed on behalf of such party by one of
its duly authorized  officers.  As used herein, the word "termination"  includes
any and all means of bringing this  Agreement to an end prior to its  expiration
by its own terms,  or  bringing  to an end any  provisions  thereof,  whether by
release, discharge, abandonment or otherwise.

                                       16
<PAGE>

         8.8 This  Agreement  shall be subject  to Section  365(n) of the United
States  Bankruptcy  Code and  Licensee  shall be entitled to the benefit of such
provisions.  Licensee  agrees,  in the  event it  should  become  a debtor  in a
proceeding  under Title 11 of the United  States Code (the  "Bankruptcy  Code"),
that: 1) the `777 Patent shall not be  considered  property of the estate within
the meaning of 11 U.S.C.  ss.541;  and 2) any license fees that shall become due
and owing for use by  Licensee of the `777  Patent  subsequent  to any order for
relief  under  11   U.S.C.ss.ss.301   or  303  shall  be  allowed  and  paid  as
administrative expenses pursuant to 11 U.S.C. ss.ss.503(b) and 507.

         8.9  This  Agreement  shall be  construed,  governed,  interpreted  and
applied in  accordance  with the laws of the State of New York,  U.S.A.,  except
that  questions  affecting  the  construction  and effect of any patent shall be
determined by the law of the country in which the patent was granted.  Any legal
action or  proceeding  relating to this  Agreement or any document or instrument
related hereto shall be brought only in the state or federal courts of the State
of New York,  and by its  execution  and  delivery of this  Agreement,  Licensee
hereby  accepts  for  itself  and in  respect  to its  property,  generally  and
unconditionally, the jurisdiction of the aforesaid courts.

         8.10 This Agreement may be executed in one or more counterparts and any
party hereto may execute any such  counterparts each of which shall be deemed an
original and all of which, taken together, shall constitute but one and the same
document.  It shall not be  necessary  in making  proof of this  document or any
counterpart hereof to produce or account for any of the other counterparts.

         8.11 The provisions of this  Agreement are severable,  and in the event
that any  provisions  of this  Agreement  shall be  determined  to be invalid or
unenforceable  under  any  controlling  body of the  law,  such  invalidity  and
unenforceability  shall not in any way affect the validity or  enforceability of
the remaining  provisions hereof. In the event the validity or  unenforceability
of any  provision  of this  Agreement is brought  into  question  because of the
decision of a court of competent  jurisdiction,  Licensor,  by written notice to
Licensee may revise the provision in question or may delete it entirely so as to
comply with the decision of said court.

         8.12 The failure or delay of either  party to assert a right  hereunder
or to insist upon  compliance with any term or condition of this Agreement shall
not constitute a waiver of that right or excuse a similar failure to perform any
such term or condition by the other party.

         8.13  Licensee  and  Licensor  recognize  the  sensitive  nature of the
information  contained in this Agreement and agree to take necessary precautions
to safeguard and treat the information as confidential  and to take  appropriate
action by  instruction,  agreement  or notice  with their  directors,  officers,
agents and employees to protect the confidential  and proprietary  nature of the
information.  Licensee and Licensor agree not to disclose,  publish or otherwise
reveal any of the  information to any other party,  other than their  respective
attorneys and accountants,  except required by financial reporting  requirements
of the U.S. Securities and Exchange  Commission,  the American Stock Exchange or
any other regulatory body to which the Licensee or its securities is subject, or
required by applicable law or by administrative action;  PROVIDED, that Licensee
may  disclose  this  Agreement to  prospective  investors or file a copy of this
Agreement with the U.S. Securities and Exchange Commission.

                                       17
<PAGE>

         8.14  Notwithstanding  anything  to  the  contrary  contained  in  this
Agreement,    Licensor   and   Licensee   (and   their   respective   employees,
representatives  and other agents) may, upon written request therefor,  disclose
at any time to any and all persons,  without limitation of any kind, any and all
information  relating to, and any facts  relevant to  understanding,  the United
States  federal  income tax  treatment of this  Agreement  and the  transactions
contemplated  by this  Agreement,  and all materials of any kind,  including tax
analyses,  relating to such tax treatment or the facts relevant to understanding
such tax treatment;  PROVIDED,  that (i) no person may disclose any confidential
business,  financial  or  other  information  or term  that is not  relevant  to
understanding the United States federal income tax treatment of the transactions
contemplated  by this  Agreement,  and (ii) the party  receiving any request for
disclosure has sent to the other party a copy of the request for disclosure.

                                       18
<PAGE>

         IN WITNESS  WHEREOF,  the  parties  have caused  this  Agreement  to be
executed in duplicate as first above written

Endolaser Associates, L.L.C.               Diomed, Inc.

By: /s/ Luis Navarro                       By: /s/ James A. Wylie, Jr.
    ------------------------------             --------------------------------
Name: Luis Navarro                         Name: James A. Wylie, Jr.
Title: Authorized Officer                  Title: President and Chief Executive
                                                  Officer

                                       19
<PAGE>

        ATTACHMENT A TO AGREEMENT EFFECTIVE JULY 11, 2003 BY AND BETWEEN
                   DIOMED, INC. AND ENDOLASER ASSOCIATES, INC

                                    U.S. PATENTS

                                    U.S. Patent No. 6,398,777

                                    U.S. PATENT APPLICATIONS

                                    None

                                    FOREIGN AND PCT PATENT APPLICATIONS

                                    PCT US0002187 (8/13/99)

                                    EP 00908406 (11/8/00)

                                    CA 2361634 (8/27/01)

                                       20
<PAGE>

        ATTACHMENT B TO AGREEMENT EFFECTIVE JULY 11, 2003 BY AND BETWEEN
                   DIOMED, INC. AND ENDOLASER ASSOCIATES, INC

                                       21
<PAGE>

                       [Letterhead of Luis Navarro, M.D.]
                                     [Date]

TO:  ENDOLASER ASSOCIATES, L.L.C.

The  undersigned  hereby  acknowledges  and agrees,  for the undersigned and the
undersigned's  heirs,  representatives  and assigns,  that the  undersigned  has
irrevocably and without right of rescission  transferred,  conveyed and assigned
to  Endolaser  Associates,  L.L.C.  all of the  undersigned's  right,  title and
interest  in  and  to the  following  patents  and  patent  applications  in all
countries  of the  world,  whether in the  United  States or any other  country,
including all continuations, continuations-in-part, divisionals, reexaminations,
reissues and extensions thereof (the "Patents"):

                       U.S. PATENTS
                       ------------

                       U.S. Patent No. 6,398,777

                       U.S. PATENT APPLICATIONS
                       ------------------------

                       None

                       FOREIGN AND PCT PATENT APPLICATIONS
                       -----------------------------------

                       PCT US0002187 (8/13/99)

                       EP 00908406 (11/8/00)

                       CA 2361634 (8/27/01)

, including any and all  improvements,  modifications or variations,  whether or
not  patentable,  in  or  to  any  device  or  method  covered  by  the  Patents
("Improvements")  known to him as of the date hereof , and hereby further agrees
to transfer, convey and assign to Endolaser Associates,  L.L.C. any Improvements
that are developed or become known to him after the date hereof..

The undersigned  further  acknowledges  and agrees,  for the undersigned and the
undersigned's  heirs,  representatives  and  assigns,  that (1) it has  received
payment in full in consideration  for its assignment of the Patents to Endolaser
Associates,  L.L.C., (2) it has granted no licenses,  liens, security interests,
charges or encumbrances  against any of the Patents,  and (3) it shall not take,
or assist any other person or entity in taking any adverse  action or making any
adverse claims in respect of any of the Patents  against  Endolaser  Associates,
L.L.C.

The undersigned further agrees, for the undersigned and the undersigned's heirs,
representatives  and assigns,  that the undersigned shall provide all assistance
as is reasonably  requested by Endolaser  Associates,  L.L.C.  and/or any of its
assignees or licensees,  at the expense of Endolaser Associates,  L.L.C. or such
assignee or  licensee,  to  prosecute  any  applications  for or  extensions  or
recordals of any Patent, to protect any Patent from infringement by unauthorized
third  parties  and to defend  against  the  claims by any third  party that any
Patent is invalid.

                                       22
<PAGE>

The foregoing acknowledgement and agreement is intended to be for the benefit of
Endolaser  Associates,  L.L.C. and any third party licensee(s) or assignee(s) of
the Patents (or any of them).

Luis Navarro, M.D.

STATE OF ______________)
                                    ss.:
COUNTY OF ____________)

         On the ____ day of  ______________,  2003,  before me, the  undersigned
personally  appeared,  personally  known to me or  proved  to me on the basis of
satisfactory  evidence to be the individual(s) whose name(s) is (are) subscribed
to the within  instrument and acknowledged to me that  he/she/they  executed the
same in his/her/their  capacity(ies),  and that by his/her/their signature(s) on
the  instrument,  the  individual(s),  or the  person  upon  behalf of which the
individual(s) acted, executed the instrument.

--------------------------------
Notary Public

                                       23
<PAGE>

                      [Letterhead of Nestor Navarro, M.D.]
                                     [Date]

TO:  ENDOLASER ASSOCIATES, L.L.C.

The  undersigned  hereby  acknowledges  and agrees,  for the undersigned and the
undersigned's  heirs,  representatives  and assigns,  that the  undersigned  has
irrevocably and without right of rescission  transferred,  conveyed and assigned
to  Endolaser  Associates,  L.L.C.  all of the  undersigned's  right,  title and
interest  in  and  to the  following  patents  and  patent  applications  in all
countries  of the  world,  whether in the  United  States or any other  country,
including all continuations, continuations-in-part, divisionals, reexaminations,
reissues and extensions thereof (the "Patents"):

               U.S. PATENTS
               ------------

               U.S. Patent No. 6,398,777

               U.S. PATENT APPLICATIONS
               ------------------------

               None

               FOREIGN AND PCT PATENT APPLICATIONS
               -----------------------------------

               PCT US0002187 (8/13/99)

               EP 00908406 (11/8/00)

               CA 2361634 (8/27/01)

, including any and all  improvements,  modifications or variations,  whether or
not  patentable,  in  or  to  any  device  or  method  covered  by  the  Patents
("Improvements")  known to him as of the date hereof , and hereby further agrees
to transfer, convey and assign to Endolaser Associates,  L.L.C. any Improvements
that are developed or become known to him after the date hereof..

The undersigned  further  acknowledges  and agrees,  for the undersigned and the
undersigned's  heirs,  representatives  and  assigns,  that (1) it has  received
payment in full in consideration  for its assignment of the Patents to Endolaser
Associates,  L.L.C., (2) it has granted no licenses,  liens, security interests,
charges or encumbrances  against any of the Patents,  and (3) it shall not take,
or assist any other person or entity in taking any adverse  action or making any
adverse claims in respect of any of the Patents  against  Endolaser  Associates,
L.L.C.

The undersigned further agrees, for the undersigned and the undersigned's heirs,
representatives  and assigns,  that the undersigned shall provide all assistance
as is reasonably  requested by Endolaser  Associates,  L.L.C.  and/or any of its
assignees or licensees,  at the expense of Endolaser Associates,  L.L.C. or such
assignee or  licensee,  to  prosecute  any  applications  for or  extensions  or
recordals of any Patent, to protect any Patent from infringement by unauthorized
third  parties  and to defend  against  the  claims by any third  party that any
Patent is invalid.

                                       24
<PAGE>

The foregoing acknowledgement and agreement is intended to be for the benefit of
Endolaser  Associates,  L.L.C. and any third party licensee(s) or assignee(s) of
the Patents (or any of them).

----------------------------
Nestor Navarro, M.D.

STATE OF ______________)
                                    ss.:
COUNTY OF ____________)

         On the ____ day of  ______________,  2003,  before me, the  undersigned
personally  appeared,  personally  known to me or  proved  to me on the basis of
satisfactory  evidence to be the individual(s) whose name(s) is (are) subscribed
to the within  instrument and acknowledged to me that  he/she/they  executed the
same in his/her/their  capacity(ies),  and that by his/her/their signature(s) on
the  instrument,  the  individual(s),  or the  person  upon  behalf of which the
individual(s) acted, executed the instrument.

--------------------------------
Notary Public

                                       25
<PAGE>

                     [Letterhead of Carlos Bone Salat, M.D.]
                                     [Date]

TO:  ENDOLASER ASSOCIATES, L.L.C.

The  undersigned  hereby  acknowledges  and agrees,  for the undersigned and the
undersigned's  heirs,  representatives  and assigns,  that the  undersigned  has
irrevocably and without right of rescission  transferred,  conveyed and assigned
to  Endolaser  Associates,  L.L.C.  all of the  undersigned's  right,  title and
interest  in  and  to the  following  patents  and  patent  applications  in all
countries  of the  world,  whether in the  United  States or any other  country,
including all continuations, continuations-in-part, divisionals, reexaminations,
reissues and extensions thereof (the "Patents"):

                      U.S. PATENTS
                      ------------

                      U.S. Patent No. 6,398,777

                      U.S. PATENT APPLICATIONS
                      ------------------------

                      None

                      FOREIGN AND PCT PATENT APPLICATIONS
                      -----------------------------------

                      PCT US0002187 (8/13/99)

                      EP 00908406 (11/8/00)

                      CA 2361634 (8/27/01)

, including any and all  improvements,  modifications or variations,  whether or
not  patentable,  in  or  to  any  device  or  method  covered  by  the  Patents
("Improvements")  known to him as of the date hereof , and hereby further agrees
to transfer, convey and assign to Endolaser Associates,  L.L.C. any Improvements
that are developed or become known to him after the date hereof..

The undersigned  further  acknowledges  and agrees,  for the undersigned and the
undersigned's  heirs,  representatives  and  assigns,  that (1) it has  received
payment in full in consideration  for its assignment of the Patents to Endolaser
Associates,  L.L.C., (2) it has granted no licenses,  liens, security interests,
charges or encumbrances  against any of the Patents,  and (3) it shall not take,
or assist any other person or entity in taking any adverse  action or making any
adverse claims in respect of any of the Patents  against  Endolaser  Associates,
L.L.C.

The undersigned further agrees, for the undersigned and the undersigned's heirs,
representatives  and assigns,  that the undersigned shall provide all assistance
as is reasonably  requested by Endolaser  Associates,  L.L.C.  and/or any of its
assignees or licensees,  at the expense of Endolaser Associates,  L.L.C. or such
assignee or  licensee,  to  prosecute  any  applications  for or  extensions  or
recordals of any Patent, to protect any Patent from infringement by unauthorized
third  parties  and to defend  against  the  claims by any third  party that any
Patent is invalid.

                                       26
<PAGE>

The foregoing acknowledgement and agreement is intended to be for the benefit of
Endolaser  Associates,  L.L.C. and any third party licensee(s) or assignee(s) of
the Patents (or any of them).

---------------------------------
Carlos Bone Salat, M.D.

STATE OF ______________)
                                    ss.:
COUNTY OF ____________)

         On the ____ day of  ______________,  2003,  before me, the  undersigned
personally  appeared,  personally  known to me or  proved  to me on the basis of
satisfactory  evidence to be the individual(s) whose name(s) is (are) subscribed
to the within  instrument and acknowledged to me that  he/she/they  executed the
same in his/her/their  capacity(ies),  and that by his/her/their signature(s) on
the  instrument,  the  individual(s),  or the  person  upon  behalf of which the
individual(s) acted, executed the instrument.

--------------------------------
Notary Public

                                       27
<PAGE>

                 [Letterhead of Joaquina Fructuoso Gomez, M.D.]
                                     [Date]

TO:  ENDOLASER ASSOCIATES, L.L.C.

The  undersigned  hereby  acknowledges  and agrees,  for the undersigned and the
undersigned's  heirs,  representatives  and assigns,  that the  undersigned  has
irrevocably and without right of rescission  transferred,  conveyed and assigned
to  Endolaser  Associates,  L.L.C.  all of the  undersigned's  right,  title and
interest  in  and  to the  following  patents  and  patent  applications  in all
countries  of the  world,  whether in the  United  States or any other  country,
including all continuations, continuations-in-part, divisionals, reexaminations,
reissues and extensions thereof (the "Patents"):

                  U.S. PATENTS
                  ------------

                  U.S. Patent No. 6,398,777

                  U.S. PATENT APPLICATIONS
                  ------------------------

                  None

                  FOREIGN AND PCT PATENT APPLICATIONS
                  -----------------------------------

                  PCT US0002187 (8/13/99)

                  EP 00908406 (11/8/00)

                  CA 2361634 (8/27/01)

, including any and all  improvements,  modifications or variations,  whether or
not  patentable,  in  or  to  any  device  or  method  covered  by  the  Patents
("Improvements")  known to him as of the date hereof , and hereby further agrees
to transfer, convey and assign to Endolaser Associates,  L.L.C. any Improvements
that are developed or become known to him after the date hereof..

The undersigned  further  acknowledges  and agrees,  for the undersigned and the
undersigned's  heirs,  representatives  and  assigns,  that (1) it has  received
payment in full in consideration  for its assignment of the Patents to Endolaser
Associates,  L.L.C., (2) it has granted no licenses,  liens, security interests,
charges or encumbrances  against any of the Patents,  and (3) it shall not take,
or assist any other person or entity in taking any adverse  action or making any
adverse claims in respect of any of the Patents  against  Endolaser  Associates,
L.L.C.

The undersigned further agrees, for the undersigned and the undersigned's heirs,
representatives  and assigns,  that the undersigned shall provide all assistance
as is reasonably  requested by Endolaser  Associates,  L.L.C.  and/or any of its
assignees or licensees,  at the expense of Endolaser Associates,  L.L.C. or such
assignee or  licensee,  to  prosecute  any  applications  for or  extensions  or
recordals of any Patent, to protect any Patent from infringement by unauthorized
third  parties  and to defend  against  the  claims by any third  party that any
Patent is invalid.

                                       28
<PAGE>

The foregoing acknowledgement and agreement is intended to be for the benefit of
Endolaser  Associates,  L.L.C. and any third party licensee(s) or assignee(s) of
the Patents (or any of them).

---------------------------------
Joaquina Fructuoso Gomez, M.D.

STATE OF ______________)
                                    ss.:
COUNTY OF ____________)

         On the ____ day of  ______________,  2003,  before me, the  undersigned
personally  appeared,  personally  known to me or  proved  to me on the basis of
satisfactory  evidence to be the individual(s) whose name(s) is (are) subscribed
to the within  instrument and acknowledged to me that  he/she/they  executed the
same in his/her/their  capacity(ies),  and that by his/her/their signature(s) on
the  instrument,  the  individual(s),  or the  person  upon  behalf of which the
individual(s) acted, executed the instrument.

--------------------------------
Notary Public

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