Document:

EXHIBIT 10.7
                                                                    ------------

                 SECOND AMENDMENT TO IMPROVENET, INC. UNSECURED
             CONVERTIBLE PROMISSORY NOTE SUBSCRIPTION AGREEMENT AND
                    8% UNSECURED CONVERTIBLE PROMISSORY NOTE

     This Second Amendment to ImproveNet, Inc. Unsecured Convertible Promissory
Note Subscription Agreement and 8% Unsecured Convertible Promissory Note (the
"SECOND AMENDMENT") is made this 23rd day of June 2004 (the "EFFECTIVE DATE") by
and between JMJS GROUP, LLLP (the "SUBSCRIBER"), and ImproveNet, Inc., a
Delaware corporation ("COMPANY"). All terms used, but not otherwise defined
herein, shall have the meanings ascribed to such terms in the ImproveNet, Inc.
Unsecured Convertible Promissory Note Subscription Agreement dated October 24,
2003, as amended, between Subscriber and Company.

     WHEREAS, Company accepted from Subscriber an ImproveNet, Inc. Unsecured
Convertible Promissory Note Subscription Agreement dated October 24, 2003 and
amended December 4, 2003 (the "AGREEMENT") for the issuance by the Company of an
8% unsecured convertible promissory note in the principal amount of $50,000 (the
"NOTE") which provided for conversion of the unpaid principal and accrued
interest into fully paid and nonassessable shares of the Company's Common Stock
at the rate of five (5) shares of Common Stock for every one dollar ($1.00) of
debt represented by the Note.

     WHEREAS, as a condition to the closing of a certain subscription received
from an accredited institutional investor for the purchase of 10,000,000 shares
of Common Stock of the Company at the price of $0.10 per share (the "NEW
INVESTMENT"), the Note must be converted into shares of Common Stock of the
Company.

     WHEREAS, to induce Subscriber to convert the Note into shares of Common
Stock of the Company immediately prior to but contingent upon the closing of the
New Investment, the Company must modify the provisions of the Agreement and the
Note on the terms and conditions set forth in this Second Amendment.

     NOW, THERFORE, in consideration of the premises, the mutual covenants and
agreements, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

     1.   Section 1(a) of the Agreement is hereby amended and restated in its
entirety as follows:

          "1.  SUBSCRIPTION.

               (a) The undersigned (the "SUBSCRIBER") hereby subscribes to
          purchase from ImproveNet, Inc., a Delaware corporation with its
          principal office located at 10799 N. 90th Street, Suite 200,
          Scottsdale, AZ 85260 (the "COMPANY"), (i) an 8% Unsecured Convertible
          Promissory Note in the form attached hereto as Exhibit A (the "NOTE")
          and (ii) a Common Stock Purchase Warrant (the "WARRANT") to purchase,
          for a three (3) year period, 333,333 shares of the Common Stock,
          $0.001 par value, of the Company (the "WARRANT SHARES") exercisable at
          $0.15 per
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          share, on the terms and subject to the conditions set forth in this
          Agreement. The terms of the Note provide for conversion of the unpaid
          principal and accrued interest into fully paid and nonassessable
          shares of the Company's Common Stock at the rate of TEN (10) shares of
          Common Stock for every one dollar ($1.00) of debt represented by the
          Note (the "SHARES"). The Note subscribed for is one in a series of
          unsecured convertible promissory notes issued pursuant to an offering
          by the Company of Notes (a minimum amount of $25,000 per Note but the
          Company in its sole discretion may accept minimum denominations of
          $5,000) totaling a minimum of $100,000 and a maximum of $500,000 in
          the aggregate (or such greater or additional maximum amount as the
          Company, in its sole discretion shall determine). The Notes are
          unsecured and have no liquidation rights or preferences senior to
          other unsecured liabilities of the Company. The Company may issue
          additional debt instruments senior to, or on parity with, the Notes,
          from time to time, in its sole discretion."

     2.   Section 2(a) of Exhibit A - Form of Unsecured Convertible Promissory
Note of the Agreement and Section 2(a) of the Note dated December 12, 2003 are
hereby amended and restated in their entirety as follows:

          "2.  CONVERSION.

          CONVERSION RATE. At any time during the term of this Note (the
          "CONVERSION PERIOD") and in the event the entire outstanding principal
          balance of this Note, plus accrued interest hereunder, has not been
          paid in full, then Lender may elect to convert, in whole or in part,
          the outstanding principal balance of this Note and accrued but unpaid
          interest into shares of common stock of Maker, par value $0.001 per
          share, (the "CONVERSION STOCK") at the rate of TEN (10) shares of
          common stock for every one dollar ($1.00) of debt represented by this
          Note (the "CONVERSION RATE"); provided, however, that Lender must
          convert a minimum of $5,000 of debt (unless Lender is converting a
          lesser amount of debt as the final conversion of all amounts due to
          Lender under the Note). Conversion under this Section 2 shall occur
          only upon surrender of this Note for conversion at the principal
          offices of the Maker along with a written request as to the amount of
          debt represented by this Note which is being converted. In the event
          that all of the outstanding principal balance and accrued but unpaid
          interest is not converted, then Maker will issue a new note for the
          balance of such outstanding amounts. Maker makes no warranties or
          representations that the shares of common stock received upon
          conversion are not or will not be "restricted securities" as that term
          is defined in Rule 144 under the Securities Act of 1933. Conversion
          under this Section 2 shall occur only upon surrender of this Note for
          conversion at the principal offices of Maker."

     3.   Subscriber agrees to and does hereby provide written notice of its
election to convert the entire outstanding principal balance and accrued but
unpaid interest on the Note as amended, in accordance with the provisions
thereof and at the conversion ratio set forth in Section 2 above, into shares of
Common Stock of the Company immediately
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prior to but contingent upon the closing of the New Investment. In the event the
New Investment does not close by July 16, 2004, then the parties agree that this
Second Amendment shall automatically be rescinded without any further action of
the parties, and this Second Amendment shall be void from its inception.

     4.   Upon the conversion as set forth in Section 3 above and surrender of
the original Note to the Company, the Company shall issue to the Subscriber a
certificate for the Shares and the Warrant document. Except as otherwise amended
hereby, the Agreement and the Note remain in full force and effect.

     5.   The Company shall prepare, and, on or prior to sixty (60) days from
the date of the Second Amendment (the "FILING DATE"), file with the Securities
and Exchange Commission ("SEC") a registration statement (the "REGISTRATION
STATEMENT") on Form S-3 (or, if Form S-3 is not then available, on Form SB-2 or
such form of Registration Statement as is then available to effect a
registration of the Shares and the Warrant Shares) covering the resale of the
Shares and the Warrant Shares, which Registration Statement, to the extent
allowable under the Act and the rules and regulations promulgated thereunder
(including Rule 416), shall state that such Registration Statement also covers
the shares underlying the Warrants. The number of shares of Common Stock
initially included in such Registration Statement shall be no less than an
amount equal to the total number of Shares and Warrant Shares, without regard to
any limitation, if any, on Subscriber's ability to exercise the Warrants. The
Company, in its sole discretion may include other selling shareholders in the
Registration Statement.

     6.   Subscriber acknowledges and understands that noteholders (i) Hayjour
Family Limited Partnership, Jeffrey I. Rassas General Partner, (ii) Farsi Family
Trust, Homayoon J. Farsi, Trustee, and (iii) Ahmad Family Trust, Naser Ahmad,
Trustee, (the "AFFILIATE SHAREHOLDERS") of which directors and officers, Jeffrey
I. Rassas, Homayoon J. Farsi, and Naser Ahmad hold beneficial ownership,
respectively, have waived participation in the conversion contemplated by this
Second Amendment. Company shall make payment in full of all outstanding
principal and accrued but unpaid interest on the Notes (as defined in Section 1
of the Agreement) held by the Affiliate Shareholders under the original
provisions thereof within a reasonable time following the closing of the New
Investment. The current principal balance of the Notes held by the Affiliate
Shareholders is $30,000. Subscriber hereby agrees and consents to such payments
by the Company to the Affiliate Shareholders.

     7.   This Second Amendment may be executed in one or more counterparts and
by original or facsimile signature, each of which will constitute an original
and all of which together will constitute one and the same instrument.

                         [SIGNATURES ON FOLLOWING PAGE]
<PAGE>

     IN WITNESS WHEREOF, this Second Amendment has been executed by each of the
parties as of the day and year first above written.

COMPANY                                         SUBSCRIBER
IMPROVENET, INC.                                JMJS GROUP, LLLP

By: /s/ Jeffrey I. Rassas                       By: /s/ Jerre Stead
    -------------------------                       -------------------------

Name:   Jeffrey I. Rassas                       Name:   Jerre Stead
      -----------------------                         -----------------------

Title:  CEO                                     Title:  General Partner
       ----------------------                          ----------------------EXHIBIT 10.1

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER ANY STATE SECURITIES LAWS AND
MAY NOT BE SOLD OR OTHERWISE TRANSFERRED OR DISPOSED OF EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER ANY APPLICABLE STATE SECURITIES LAWS, OR
AN OPINION OF COUNSEL SATISFACTORY TO COUNSEL TO THE COMPANY THAT AN EXEMPTION
FROM REGISTRATION UNDER ANY APPLICABLE STATE SECURITIES LAWS IS AVAILABLE.

THIS NOTE IS ONE OF A SERIES OF NOTES OF THE SAME TERMS AND TENOR THAT MAY BE
ISSUED BY MAKER UP TO AN AGGREGATE OF $2,000,000.

                                ASHCROFT HOMES CORPORATION

                     10% CONVERTIBLE PROMISSORY NOTE (the "Note")

$25,000.00                                                        March 27, 2004

     FOR VALUE RECEIVED, the undersigned maker, Ashcroft Homes Corporation, a
Colorado corporation (the "Maker"), promises to pay to the order of Investor
(the "Holder"), the principal sum of Twenty Five Thousand Dollars ($25,000.00)
in quarterly payments of interest only of ten percent (10%) per annum of the
principal balance payable in arrears commencing March 31, 2004 with all
subsequent interest only payments due on a quarterly basis thereafter and with
all principal and accrued but unpaid interest due on December 31, 2005 unless
this Note has been previously converted to the Maker's common stock as set forth
below. The Maker will pay all payments due pursuant to this Note to Holder at
Address or at such other place as Holder may designate in writing.

     This Note may be converted to the Maker's no par value common stock by the
Holder at any time until this Note is paid in full at the lesser of $1.00 per
share or 80% of the average closing price of the common stock for the twenty
(20) days prior to the date that the Maker receives written notice of conversion
from the Holder. However, if the conversion price is less than $.30 per share,
the Maker may elect to pay 110% of the face amount of this Note plus all accrued
but unpaid interest to the date of payment rather than issuing its common stock
at less than $.30 per share. Other than the foregoing, the Maker may not prepay
this Note in whole or in part without the Holder's consent in writing to such
prepayment. Unless the shares upon conversion are covered by an effective
registration statement, such shares shall be "restricted securities" as that
term is defined in the Securities Act of 1933, as amended. The certificate
representing such shares shall bear the following or a similar legend:

           "These securities have not been registered under the
           Securities Act of 1933, as amended, or any state securities
           laws and may not be sold or otherwise transferred or
           disposed of except pursuant to an effective registration
           statement under any applicable federal and state securities
           laws, or an opinion of counsel satisfactory to counsel to
           the corporation that an exemption from registration is
           available."

Maker will be in default if any of the following happens: (a) Maker fails to
make any payment within ten (10) days of when due or (b) Maker fails to perform
at the time and in the manner provided in this Note or any agreement related to
this Note.

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     Upon default, Holder may declare the entire unpaid principal balance on
this Note and all accrued unpaid interest immediately due, without notice, and
then Maker will pay that amount. Upon default, including failure to pay any
payment within ten (10) days of when due or upon the final maturity, whichever
occurs first, Holder, at its option, may also if permitted under applicable law,
do one or both of the following: (a) increase the interest rate on this Note to
15%, and (b) add any unpaid accrued interest to principal and such sum will bear
interest therefrom until paid at the rate provided in this Note (including any
increased rate). If Maker is in default, Maker also will pay reasonable costs
and expenses of collection including, subject to any limits under applicable
law, Holder's reasonable attorney's fees and legal expenses whether or not there
is a lawsuit. If not prohibited by applicable law, Maker also will pay any court
costs, in addition to all other sums provided by law. This Note shall be senior
to the Maker's common and preferred stock.

     No delay or omission on the part of Holder in the exercise of any right
hereunder shall operate as a waiver of such right or of any other right under
this Note. A waiver by Holder of any right or remedy conferred to it hereunder
on any one occasion shall not be construed as a bar to, or waiver of, any such
right and/or remedy as to any future occasion. Maker and all persons now or
hereafter becoming obligated or liable for the payment hereof do jointly and
severally waive demand, notice of non-payment, protest, notice of dishonor and
presentment. No failure to accelerate the indebtedness evidenced hereby by
reason of default hereunder, acceptance of a past-due installment or other
indulgences granted from time to time, shall be construed as a novation of this
Note or as a waiver of such right of acceleration or of the right of Holder
thereafter to insist upon strict compliance with the terms of this Note or to
prevent the exercise of such right of acceleration or any other right granted
hereunder or by applicable law.

     No Maker intends or expects to pay, nor does Holder intend or expect to
charge, collect or accept, any interest greater than the highest legal rate of
interest which may be charged under any applicable law. Should the acceleration
hereof or any charges made hereunder result in the computation or earning of
interest in excess of such legal rate, any and all such excess shall be and the
same is hereby waived by Holder, and any such excess shall be credited by Holder
to the principal balance hereof.

     This Note shall be construed and enforced according to the laws of the
State of Colorado excluding all principles of choice of laws, conflict of laws
or comity. Each person now or hereafter becoming obligated for the payment of
the indebtedness evidenced hereby consents to personal jurisdiction and venue in
Arapahoe County, Colorado, in the event of any litigation in any way arising out
of this Note, or any property given as security for the amounts evidenced by
this Note.

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     This Note shall be binding on the successors and assigns of Maker. Maker
may not assign this Note without the written consent of Holder. This Note shall
inure to the benefit of the Holder's successors, assigns, heirs or personal
representatives. The term "Holder" used herein shall include any future holder
of this Note. The terms of this Note may not be changed orally.

     Whenever possible each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited or invalid under such law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Note.

                                 MAKER:

                                 ASHCROFT HOMES CORPORATION,
                                 a Colorado corporation

                             By: /s/ Joe A. Oblas
                                 --------------------------------------
                                 Joe A. Oblas, Executive Vice President

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