Document:

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                                                                    Exhibit 10.7

                                     [LOGO]

                              Dr. Amnon Mandelbaum
                                Managing Director
                               Investment Banking
                Telephone (212) 421-1616 Facsimile (212) 750-7277

Mr. James A. Wylie,  President & CEO Diomed  Holdings,  Inc. One Dundee Park, PO
Box 97
Andover, MA  01810

RE:      Amendment #2  ("Amendment")  to the Financial  Advisory and  Investment
         Banking  Agreement   ("Agreement")  between  Sunrise  Securities  Corp.
         ("Sunrise") and Diomed Holdings, Inc. ("Company") dated April 11, 2003,
         as previously amended.

Dear Jim:

This  Amendment to the  Agreement  between  Sunrise and the Company  dated as of
September  2,  2003,  is to amend our  existing  Agreement  and to  confirm  our
discussions  and  understandings  regarding the receipt of our Financing Fees in
stock rather than cash upon the closing of the Financing. Capitalized terms used
in this Amendment which are not defined herein shall have the meanings  ascribed
to such terms in the Agreement or in the draft  Securities  Purchase  Agreement,
dated as of August 8, 2003,  pursuant to which the Company currently proposes to
issue secured bridge notes and shares of Common Stock, as the same may hereafter
be revised, supplemented or amended (the "Proposed Financing").

1.       Financing Fees: The Company and Sunrise hereby agree as follows:

         (a)      At  Tranche I Closing,  Sunrise  and/or  its  designees  shall
                  receive secured bridge notes  (substantially the same as those
                  issued  to the  investors  in  the  Proposed  Financing)  (the
                  "Notes") and warrants to purchase  shares of Common Stock (the
                  "Warrants"),  in each  case,  based on the  total  funds to be
                  received by the Company in the Proposed  Financing (other than
                  funds raised from Special  Parties),  including funds received
                  by the  Company  at the  Tranche I Closing  and all funds then
                  remaining in escrow, and the value of Sunrise's Financing Fees
                  as though the amount of cash to which  Sunrise would have been
                  entitled  (but  for  this  Amendment)  was  reinvested  in the
                  Company.

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         (b)      At the Tranche I Closing,  Sunrise and/or its designees  shall
                  receive such aggregate  principal amount of Notes and Warrants
                  as is set forth in the table below.

         (c)      All Warrants shall be exercisable for five years from the date
                  of receipt of the approval of the  Company's  stockholders  of
                  the  Proposed  Financing  and are not  exercisable  until such
                  approval is obtained.  The Warrants shall be  substantially in
                  the form annexed hereto as Exhibit A.

                --------------------------------------------- ---------------
                Aggregate Principal Amount of Notes                 $495,000
                --------------------------------------------- ---------------
                Warrants (exercise price of $.001)                15,035,625
                --------------------------------------------- ---------------
                Warrants (exercise price of $.08)                  6,187,500
                --------------------------------------------- ---------------
                Warrants (exercise price of $.10)                 14,850,000
                --------------------------------------------- ---------------

              The table  above  assumes  that $18 million is raised in Tranche I
              and Tranche II (and is raised other than from Special Parties) and
              is in escrow  as of the  Tranche I  Closing.  If the total  amount
              raised in Tranche I and Tranche II is less than $18  million,  the
              numbers above will be adjusted downward.

              If the total amount  raised in Tranche I and Tranche II is greater
              than $18 million,  then Sunrise  and/or its designees will receive
              Warrants  in respect of the total funds in excess  thereof  (i.e.,
              the difference between the total amount raised and $18 million) as
              set forth in the table  below.  The table  below  assumes  that $2
              million is raised in Tranche I and Tranche II in excess of the $18
              million,  or a total of $20 million (and is raised from other than
              Special Parties) and is in escrow as of the Tranche I Closing.  If
              the total  amount  raised in excess of $18 million is less or more
              than $2 million,  then the numbers below will be adjusted downward
              or upward, accordingly.

                -------------------------------------------- ---------------
                Warrants (exercise price of $.001)                2,784,375
                -------------------------------------------- ---------------
                Warrants (exercise price of $.08)                 2,750,000
                -------------------------------------------- ---------------

              In addition to the Notes and  Warrants  described  above,  Sunrise
              and/or its  designees  shall be  entitled  to receive  Late Filing
              Payments  and Late  Effective  Payments (as such terms are defined
              and  used  in the  Investors'  Rights  Agreement  relating  to the
              Proposed  Financing) based on the number of shares of Common Stock
              underlying  the Notes and the Warrants  which are  exercisable  at
              $.001.

                                       2
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              The  Company  acknowledges  that  Sunrise  intends  to  allocate a
              substantial  portion of the Notes and/or Warrants which are issued
              to Sunrise and/or its designees to its employees  and/or  selected
              broker dealers.  The Company agrees that it shall promptly (and in
              any event,  within  five  business  days),  without  charge to the
              transferring holder or transferee,  upon request by any transferor
              for  such  transfer  and upon  receipt  of  Notes  and/or  Warrant
              certificates   representing  the  subject   securities,   properly
              endorsed for transfer, issue new Notes and/or Warrant certificates
              in such denominations and to such designated  transferees as shall
              be requested.

              For the avoidance of doubt,  none of the Notes or Warrants (or any
              shares of Common  Stock  issued  upon  conversion  of the Notes or
              exercise of the Warrants) to be issued hereunder shall be eligible
              for participation in the rights offering that the Company proposes
              to make following the Tranche II Closing.

No provision of this Amendment may be amended,  modified or waived,  except in a
writing signed by all of the parties hereto.

This  Amendment  may be  executed in any number of  counterparts,  each of which
together shall constitute one and the same original document. This Amendment may
be executed and delivered by exchange of facsimile  copies  showing the parties'
signatures,  and those  signatures  need not be affixed  to the same  copy.  The
facsimile   copies  showing  the  signatures  of  the  parties  will  constitute
originally signed copies of the same Amendment requiring no further execution.

This Amendment shall be construed in accordance with and governed by the laws of
the State of New York, without giving effect to its conflict of law principles.

Except as modified by this Amendment, the Agreement shall continue in full force
and effect.

IN WITNESS  WHEREOF,  the parties hereto have executed this Amendment on the day
and year first above written.

DIOMED HOLDINGS, INC.                            SUNRISE SECURITIES CORP.
By Its Authorized Signatory:                     By Its Authorized Signatory:

By: /s/  JAMES A. WYLIE, JR.                    By: /s/  NATHAN LOW
    --------------------------------                ----------------------------

Dated:  September 3, 2003                       Dated: September 3, 2003
      ------------------------------                   -------------------------

                                       3
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                                    Exhibit A

                           [Form of Warrant to Follow]

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         THE WARRANTS  REPRESENTED BY THIS  CERTIFICATE AND THE OTHER SECURITIES
         ISSUABLE  UPON  EXERCISE  HEREOF  MAY NOT BE  OFFERED  OR  SOLD  EXCEPT
         PURSUANT  TO  (i)  AN  EFFECTIVE   REGISTRATION   STATEMENT  UNDER  THE
         SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),  (ii) AN EXEMPTION FROM
         REGISTRATION,  OR (iii) TO THE EXTENT  APPLICABLE,  RULE 144 UNDER SUCH
         ACT (OR ANY SIMILAR RULE UNDER SUCH ACT RELATING TO THE  DISPOSITION OF
         SECURITIES).

         THE  TRANSFER OR EXCHANGE OF THE WARRANTS  REPRESENTED  BY THE ATTACHED
         WARRANT  CERTIFICATE  ARE  RESTRICTED  IN  ACCORDANCE  WITH  THE  TERMS
         PROVIDED HEREIN.

                             STOCK PURCHASE WARRANT

Date of Issuance: [September 2, 2003]/1/                Certificate No. W-__

FOR VALUE RECEIVED,  Diomed Holdings,  Inc., a Delaware corporation,  located at
One Dundee Park, Andover, MA, 01810 (the "Company"), hereby grants to [ ] or its
registered  assigns (the  "Registered  Holder")  the right to purchase  from the
Company up to [ ] shares of the Company's Common Stock (as adjusted from time to
time  hereunder) at a price per share of Common Stock equal to [$ ] (as adjusted
from time to time hereunder,  the "Exercise Price").  Certain  capitalized terms
used herein are defined in Section 5 hereof.  The amount and kind of  securities
obtainable  pursuant to the rights granted  hereunder and the purchase price for
such securities are subject to adjustment  pursuant to the provisions  contained
in this Warrant.

                  This Warrant is subject to the following provisions:

         Section 1.  Exercise of Warrant.

                  1.1. Exercise Period.  The Registered Holder may exercise,  in
whole or in part,  the purchase  rights  represented by this Warrant at any time
and from time to time after the Necessary  Approval  Date to and including  5:00
p.m., New York time, on the fifth  anniversary  thereof or, if such day is not a
Business Day, on the next preceding  Business Day (the "Exercise  Period").  The
Company shall give the Registered Holder written notice of the expiration of the
rights  hereunder  at least  thirty (30) days but not more than ninety (90) days
prior to the end of the Exercise Period.

--------
1 Such date to be the date of the Tranche I closing.

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                  1.2. Exercise Procedure.

                            (a)  This  Warrant  shall  be  deemed  to have  been
exercised  when  the  Company  has  received  all of the  following  items  (the
"Exercise Time"):

                                    (i)  a  completed  Exercise  Agreement,   as
         described in paragraph 1.3 below, executed by the Person exercising all
         or  part of the  purchase  rights  represented  by  this  Warrant  (the
         "Purchaser");

                                    (ii)    this Warrant;

                                    (iii) if this Warrant is not  registered  in
         the name of the Purchaser,  an Assignment or Assignments evidencing the
         assignment  of  this  Warrant  to the  Purchaser,  in  which  case  the
         Registered  Holder shall have complied with the provisions set forth in
         Section 7 hereof; and

                                    (iv)  either  (1) a  check  payable  to  the
         Company  in an  amount  equal  to the  product  of the  Exercise  Price
         multiplied by the number of shares of Common Stock being purchased upon
         such exercise (the "Aggregate  Exercise  Price"),  (2) the surrender to
         the Company of debt or equity  securities of the Company  having a Fair
         Market Value equal to the Aggregate  Exercise Price of the Common Stock
         being purchased upon such exercise (provided, that for purposes of this
         subparagraph,  the Fair Market Value of any note or other debt security
         or any  preferred  stock  shall be deemed to be equal to the  aggregate
         outstanding  principal  amount or  liquidation  value  thereof plus all
         accrued and unpaid  interest  thereon or accrued or declared and unpaid
         dividends  thereon)  or (3) a written  notice to the  Company  that the
         Purchaser  is  exercising  the  Warrant  (or a  portion  thereof)  on a
         "cashless"  basis in exchange for that number of shares of Common Stock
         equal to the  product  of (x) the  number of  shares  as to which  such
         Warrants  are  being  exercised  multiplied  by  (y)  a  fraction,  the
         numerator of which is the Fair Market Value (as hereinafter defined) of
         the Common Stock less the Exercise  Price and the  denominator of which
         is such Fair Market  Value.  Solely for the  purposes  of this  Section
         1.2(a)(iv),  Fair Market  Value shall be  calculated  either (i) on the
         trading  date  immediately  preceding  the  date on  which  the Form of
         Election to Purchase  annexed to such  Warrant  Certificate  as to such
         exercise is deemed to have been sent to the Company pursuant to Section
         10 hereof (the "Notice  Date"),  (ii) as the average of the Fair Market
         Values for each of the twenty  trading days  preceding the date that is
         two  trading  days  prior to the Notice  Date,  or (iii) on the date of
         issuance  of this  Warrant,  whichever  results in a higher Fair Market
         Value.

                    (b)  Certificates  for shares of Common Stock purchased upon
exercise of this  Warrant  shall be  delivered  by the Company to the  Purchaser
within three (3) Business Days after the date of the Exercise Time.  Unless this
Warrant has expired or all of the purchase rights  represented  hereby have been
exercised,  the Company  shall  prepare a new Warrant,  substantially  identical
hereto,  representing the rights formerly represented by this Warrant which have
not expired or been  exercised and shall within such three-day  period,  deliver
such  new  Warrant  to the  Person  designated  for  delivery  in  the  Exercise
Agreement.

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                    (c) The Common  Stock  issuable  upon the  exercise  of this
Warrant  shall be deemed to have been issued to the  Purchaser  at the  Exercise
Time,  and the  Purchaser  shall be deemed for all  purposes  to have become the
record holder of such Common Stock at the Exercise Time.

                    (d) The issuance of certificates  for shares of Common Stock
upon  exercise of this Warrant  shall be made without  charge to the  Registered
Holder or the  Purchaser  for any issuance tax in respect  thereof or other cost
incurred  by the  Company  in  connection  with such  exercise  and the  related
issuance of shares of Common  Stock.  Each share of Common Stock  issuable  upon
exercise of this Warrant shall upon payment of the Exercise Price  therefor,  be
fully paid and nonassessable and free from all liens and charges with respect to
the issuance thereof.

                    (e) The  Company  shall  not close  its  books  against  the
transfer of this Warrant or of any share of Common Stock issued or issuable upon
the  exercise of this  Warrant in any manner  which  interferes  with the timely
exercise  of this  Warrant.  The  Company  shall from time to time take all such
action  as may be  necessary  to  assure  that the par  value  per  share of the
unissued  Common Stock  acquirable upon exercise of this Warrant is at all times
equal to or less than the Exercise Price then in effect.

                    (f)  The  Company  shall  assist  and  cooperate   with  any
Registered  Holder or  Purchaser  required to make any  governmental  filings or
obtain any governmental approvals prior to or in connection with any exercise of
this Warrant (including,  without limitation,  making any filings required to be
made by the Company).

                    (g)  Notwithstanding  any  other  provision  hereof,  if  an
exercise of all or any portion of this Warrant is to be made in connection  with
a registered public offering, a sale of the Company or any transaction or event,
including a Qualified Public Offering, such exercise may, at the election of the
Registered  Holder,  be conditioned upon the consummation of such transaction or
event in which case such exercise shall not be deemed to be effective  until the
consummation of such transaction or event.

                    (h)  The  Company  shall  at  all  times  reserve  and  keep
available out of its authorized  but unissued  shares of Common Stock solely for
the purpose of issuance upon the exercise of the Warrants, such number of shares
of Common Stock as are issuable upon the exercise of all  outstanding  Warrants.
All shares of Common Stock which are so issuable shall, when issued, be duly and
validly issued,  fully paid and nonassessable and free from all taxes, liens and
charges.  The Company  shall take all such actions as may be necessary to assure
that all such shares of Common Stock may be so issued  without  violation of any
applicable law or  governmental  regulation or any  requirements of any domestic
securities  exchange upon which shares of Common Stock may be listed (except for
official notice of issuance which shall be immediately  delivered by the Company
upon each such  issuance).  The  Company  shall not take any action  which would
cause the number of  authorized  but unissued  shares of Common Stock to be less
than the number of such shares  required to be reserved  hereunder  for issuance
upon  exercise of the  Warrants.  The Company will use its best efforts to cause
the shares of Common Stock,  immediately upon such exercise, to be listed on any
domestic  securities  exchange  upon  which  shares  of  Common  Stock  or other
securities  constituting  such shares of Common  Stock are listed at the time of
such exercise.

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                  1.3.  Exercise  Agreement.  Upon any exercise of this Warrant,
the Exercise  Agreement shall be  substantially  in the form set forth in either
Exhibit I or Exhibit II  attached  hereto,  except  that if the shares of Common
Stock are not to be issued in the name of the Person in whose name this  Warrant
is registered, the Exercise Agreement shall also state the name of the Person to
whom the  certificates  for the shares of Common Stock are to be issued,  and if
the  number  of shares of Common  Stock to be issued  does not  include  all the
shares of Common Stock  purchasable  hereunder,  it shall also state the name of
the  Person to whom a new  Warrant  for the  unexercised  portion  of the rights
hereunder is to be delivered.  Such Exercise Agreement shall be dated the actual
date of execution thereof.

                  1.4.  Fractional  Shares. If the Common Stock is listed on any
securities  exchange  or  quoted  on  the  Nasdaq  Stock  Market  System  or the
over-the-counter  market and a fractional  share of Common Stock would,  but for
the  provisions of this  paragraph  1.4, be issuable upon exercise of the rights
represented by this Warrant,  the Company  shall,  within five (5) Business Days
after the date of the Exercise Time, deliver to the Purchaser a check payable to
the  Purchaser  in lieu of such  fractional  share  in an  amount  equal  to the
difference  between Fair Market Value of such fractional share as of the date of
the Exercise Time and the Exercise Price of such fractional share.

         Section 2.  Adjustment of Exercise Price and Number of Shares of Common
Stock. In order to prevent dilution of the rights granted under this Warrant and
grant the Registered Holder hereof certain additional rights, the Exercise Price
and the  number of  shares of Common  Stock  obtainable  upon  exercise  of this
Warrant  shall be subject to  adjustment  from time to time as  provided in this
Section 2.

                  2.1.   Computation  of  Adjusted  Exercise  Price.  Except  as
hereinafter  provided  and subject to Section  2.6  hereof,  in case the Company
shall at any time after the date hereof issue or sell any shares of Common Stock
or Common Stock Equivalents for a consideration per share less than the Exercise
Price in effect  immediately prior to the issuance or sale of such shares on the
date  immediately  prior to the  issuance  or sale of such  shares,  or  without
consideration,  then  forthwith  upon such issuance or sale,  the Exercise Price
shall (until another such issuance or sale) be reduced to the price  (calculated
to the nearest  full cent)  equal to the  quotient  derived by  dividing  (i) an
amount  equal to the sum of (a) the total  number  of  shares  of  Common  Stock
outstanding immediately prior to the issuance or sale of such shares, multiplied
by the Exercise Price in effect  immediately prior to such

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issuance or sale, and (b) the aggregate of the amount of all  consideration,  if
any,  received by the  Company  upon such  issuance  or sale,  by (ii) the total
number of shares of Common Stock outstanding  immediately after such issuance or
sale; provided,  however,  that in no event shall the Exercise Price be adjusted
pursuant to this  computation  to an amount in excess of the  Exercise  Price in
effect  immediately  prior  to  such  computation,  except  in  the  case  of  a
combination  of outstanding  shares of Common Stock,  as provided by Section 2.3
hereof.

         For the purposes of any  computation to be made in accordance with this
Section 2.1, the following provisions shall apply:

                           (a) In the event of the issuance or sale of shares of
Common Stock for a consideration, part or all of which shall be cash, the amount
of the cash  consideration  therefor  shall be deemed  to be the  amount of cash
received by the  Company  for such  shares  (or,  if shares of Common  Stock are
offered by the Company for subscription, the subscription price, or if either of
such  securities  shall be sold to  underwriters  or dealers for public offering
without a  subscription  offering,  the initial  public  offering  price) before
deducting  therefrom  any  compensation  paid or  discount  allowed in the sale,
underwriting or purchase thereof by underwriters or dealers or others performing
similar services, or any expenses incurred in connection therewith.

                           (b) In the event of the  issuance or sale  (otherwise
than as a dividend or other  distribution on any stock of the Company) of shares
of Common  Stock for a  consideration  part or all of which  shall be other than
cash, the amount of the  consideration  therefor other than cash shall be deemed
to be the value of such  consideration  as determined in good faith by the Board
of Directors of the Company.

                           (c)  Shares  of  Common  Stock  issuable  by  way  of
dividend  or other  distribution  on any capital  stock of the Company  shall be
deemed to have been issued  immediately after the opening of business on the day
following  the record date for the  determination  of  stockholders  entitled to
receive  such  dividend or other  distribution  and shall be deemed to have been
issued without consideration.

                           (d) The reclassification of securities of the Company
other than shares of Common  Stock into  securities  including  shares of Common
Stock shall be deemed to involve the issuance of such shares of Common Stock for
a consideration  other than cash  immediately  prior to the close of business on
the date fixed for the  determination  of security  holders  entitled to receive
such  shares,  and the value of the  consideration  allocable  to such shares of
Common Stock shall be determined  as provided in subsection  (b) of this Section
2.1.

                           (e) The  number of shares of Common  Stock at any one
time outstanding shall include the aggregate number of shares issued or issuable
(subject to readjustment  upon the actual issuance thereof) upon the exercise of
Common Stock Equivalents.

                  2.2.   Options,   Rights,   Warrants   and   Convertible   and
Exchangeable Securities. Subject to Section 2.6 hereof, in the event the Company
at any time  after  the date  hereof  issues  options,  rights  or  warrants  to
subscribe for shares of Common Stock, or issue any Common Stock Equivalents, for
a  consideration  per share less than the Exercise  Price in effect  immediately
prior

<PAGE>

to the issuance of such  options,  rights or warrants,  or such  convertible  or
exchangeable securities, or without consideration,  the Exercise Price in effect
immediately prior to the issuance of such options,  rights or warrants,  or such
convertible or exchangeable securities,  as the case may be, shall be reduced to
a price  determined by making a computation in accordance with the provisions of
Section 2.1 hereof, provided that:

         (a) The aggregate maximum number of shares of Common Stock, as the case
     may be, issuable under such options,  rights or warrants shall be deemed to
     be issued and outstanding at the time such options, rights or warrants were
     issued,  and for a  consideration  equal to the minimum  purchase price per
     share  provided  for in such  options,  rights or  warrants  at the time of
     issuance,  plus  the  consideration  (determined  in  the  same  manner  as
     consideration  received on the issue or sale of shares in  accordance  with
     the  terms of the  Warrants),  if any,  received  by the  Company  for such
     options, rights or warrants.

         (b) The  aggregate  maximum  number of shares of Common Stock  issuable
     upon conversion or exchange of any  convertible or exchangeable  securities
     shall be deemed to be issued and  outstanding  at the time of  issuance  of
     such  securities,  and  for a  consideration  equal  to  the  consideration
     (determined  in the same manner as  consideration  received on the issue or
     sale of  shares  of  Common  Stock  in  accordance  with  the  terms of the
     Warrants)  received by the Company  for such  securities,  plus the minimum
     consideration,  if any,  receivable  by the Company upon the  conversion or
     exchange thereof.

              (c) If any change shall occur in the price per share  provided for
in any of the options,  rights or warrants referred to in subsection (a) of this
Section  2.2, or in the price per share at which the  securities  referred to in
subsection  (b) of  this  Section  2.2 are  convertible  or  exchangeable,  such
options,  rights or warrants or conversion or exchange  rights,  as the case may
be,  shall be deemed to have expired or  terminated  on the date when such price
change became effective in respect of shares not theretofore  issued pursuant to
the exercise or conversion or exchange thereof,  and the Company shall be deemed
to have issued upon such date new options,  rights or warrants or convertible or
exchangeable  securities  at the new price in  respect  of the  number of shares
issuable upon the exercise of such options, rights or warrants or the conversion
or exchange of such convertible or exchangeable securities.

              (d) Calculation of  Consideration  Received.  If any Common Stock,
Options  or  Convertible  Securities  are  issued or sold or deemed to have been
issued or sold for cash, the consideration  received therefor shall be deemed to
be the net amount  received by the Company  therefor.  In case any Common Stock,
Options or Convertible  Securities are issued or sold for a consideration  other
than cash,  the amount of the  consideration  other  than cash  received  by the
Company  shall  be the fair  value  of such  consideration,  except  where  such
consideration consists of securities,  in which case the amount of consideration
received by the Company shall be the Fair Market Value thereof as of the date of
receipt. In case any Common Stock, Options or Convertible  Securities are issued
to the owners of the non-surviving entity in connection with any merger in which
the Company is the surviving  corporation,  the amount of consideration therefor
shall be deemed  to be the fair  value of such  portion  of the net  assets  and
business of the  non-surviving  entity as is  attributable to such Common Stock,
Options  or  Convertible  Securities,  as the case may be. The fair value of any
consideration  other than cash or securities shall be determined  jointly by the
Company and the  Registered  Holders of  Warrants  representing  a

<PAGE>

Majority  (as  defined  in  Section  19.4(l))  of the  shares  of  Common  Stock
obtainable upon exercise of the outstanding Warrants. If such parties are unable
to reach agreement within a reasonable  period of time, such fair value shall be
determined by an appraiser  jointly  selected by the Company and the  Registered
Holders  of  Warrants  representing  a Majority  of the  shares of Common  Stock
obtainable upon exercise of the outstanding Warrants.  The determination of such
appraiser  shall be final and binding on the Company and the Registered  Holders
of the Warrants,  and the fees and expenses of such  appraiser  shall be paid by
the Company.

              (e)  Integrated  Transactions.  In case any  Option  is  issued in
connection with the issue or sale of other  securities of the Company,  together
comprising one  integrated  transaction  in which no specific  consideration  is
allocated to such Options by the parties thereto, the Options shall be deemed to
have been issued without consideration.

              (f) Treasury Shares. The disposition of any shares of Common Stock
owned or held by or for the  account of the Company or any  Subsidiary  shall be
considered an issue or sale of Common Stock.

              (g) Record Date.  If the Company  takes a record of the holders of
Common  Stock for the  purpose of  entitling  them (A) to receive a dividend  or
other distribution payable in Common Stock, Options or in Convertible Securities
or (B) to  subscribe  for or  purchase  Common  Stock,  Options  or  Convertible
Securities, then such record date shall be deemed to be the date of the issue or
sale of the shares of Common  Stock  deemed to have been issued or sold upon the
declaration  of such  dividend or the making of such other  distribution  or the
date of the granting of such right of subscription or purchase,  as the case may
be.

         2.3. Subdivision and Combination. In the event the Company shall at any
time subdivide or combine the outstanding  shares of Common Stock,  the Exercise
Price shall forthwith be proportionately decreased in the case of subdivision or
increased in the case of combination.

         2.4.  Adjustment in Number of Securities.  Upon each  adjustment of the
Exercise  Price  pursuant  to the  provisions  of this  Section 2, the number of
shares of Common Stock of the Company issuable upon the exercise of each Warrant
shall be adjusted to the nearest  full amount by  multiplying  a number equal to
the Exercise Price in effect  immediately prior to such adjustment by the number
of shares of Common Stock of the Company  issuable upon exercise of the Warrants
immediately prior to such adjustment and dividing the product so obtained by the
adjusted Exercise Price.

         2.5. Merger or Consolidation.  In the event of any consolidation of the
Company  with,  or merger of the Company with, or merger of the Company into, or
sale  by the  Company  of all or  substantially  all of its  assets  to  another
corporation or other entity (other than a consolidation or merger which does not
result in any  reclassification  or change of the outstanding Common Stock), the
corporation or other entity formed by such  consolidation  or merger or acquiror
of such assets shall execute and deliver to the Registered Holder a supplemental
warrant  agreement  providing  that the  Registered  Holder of each Warrant then
outstanding  or to be

<PAGE>

outstanding  shall  have the right  thereafter  (until  the  expiration  of such
Warrant)  to receive,  upon  exercise  of such  Warrant,  the kind and amount of
shares  of  stock  and  other  securities  and  property  receivable  upon  such
consolidation or merger,  by a holder of the number of shares of Common Stock of
the Company for which such Warrant might have been exercised  immediately  prior
to such  consolidation,  merger,  sale or transfer.  Such  supplemental  warrant
agreement  shall  provide  for  adjustments  which  shall  be  identical  to the
adjustments  provided in Section 2. The above provision of this Subsection shall
similarly apply to successive consolidations or mergers.

         2.6. No Adjustment of Exercise Price in Certain Cases. No adjustment of
the Exercise Price shall be made:

              (a) Upon the  issuance  or sale of the  Warrants  or the shares of
Common Stock issuable upon the exercise of the Warrants, or the options,  rights
and Warrants issued and outstanding on the date hereof,  or upon the issuance or
sale  of any  Excluded  Securities  or of  any  Common  Stock  or  Common  Stock
Equivalents  issued upon the  exercise,  conversion  or exchange of any Excluded
Securities; or

              (b) If the  amount  of said  adjustment  shall be less than 1 cent
($.01)  per  share of Common  Stock,  provided,  however,  that in such case any
adjustment  that would  otherwise  be required  then to be made shall be carried
forward and shall be made at the time of and together  with the next  subsequent
adjustment which, together with any adjustment so carried forward,  shall amount
to at least 1 cent ($.01) per share of Common Stock.

         2.7. Dividends and Other  Distributions.  In the event that the Company
shall at any time  prior to the  exercise  of all  Warrants  declare a  dividend
(other than a dividend consisting solely of shares of Common Stock) or otherwise
distribute  to its  stockholders  any assets,  property,  rights,  evidences  of
indebtedness,  securities (other than shares of Common Stock), whether issued by
the Company or by another,  or any other thing of value, the Registered  Holders
of the  unexercised  Warrants shall  thereafter be entitled,  in addition to the
shares of Common Stock or other  securities  and property  receivable  under the
exercise  thereof,  to receive,  upon the  exercise of such  Warrants,  the same
property,  assets,  rights,  evidences of indebtedness,  securities or any other
thing of value that they would have been entitled to receive at the time of such
dividend or distribution as if the Warrants had been exercised immediately prior
to  such  dividend  or  distribution.  At the  time  of  any  such  dividend  or
distribution,  the Company shall make appropriate  reserves to ensure the timely
performance of the provisions of this Subsection 2.7.

         2.8.  Certain Events.  If any event occurs of the type  contemplated by
the  provisions  of  this  Section  2 but  not  expressly  provided  for by such
provisions  (including,  without limitation,  the granting of stock appreciation
rights,  phantom  stock rights or other rights with equity  features),  then the
Board of Directors  shall make an  appropriate  adjustment in the Exercise Price
and the  number of  shares of Common  Stock  obtainable  upon  exercise  of this
Warrant so as to protect  the rights of the holders of the  Warrants;  provided,
that no such adjustment shall increase the Exercise Price or decrease the number
of shares of Common Stock  obtainable as otherwise  determined  pursuant to this
Section 2.

<PAGE>

         2.9. Notices.

              (a)  Immediately  upon any adjustment of the Exercise  Price,  the
Company shall give written  notice  thereof to the  Registered  Holder,  setting
forth in reasonable detail and certifying the calculation of such adjustment.

              (b) The Company shall give written notice to the Registered Holder
at least  twenty  (20) days  prior to the date on which the  Company  closes its
books or takes a record (A) with  respect to any dividend or  distribution  upon
the Common Stock, (B) with respect to any pro rata subscription offer to holders
of  Common  Stock or (C) for  determining  rights to vote  with  respect  to any
Qualified  Public   Offering,   Liquidation   Event  or  other   dissolution  or
liquidation.

              (c) The Company shall also give written  notice to the  Registered
Holders  at least  twenty  (20) days  prior to the date on which  any  Qualified
Public Offering,  Liquidation  Event or other  dissolution or liquidation  shall
take place.

         Section 3.  Liquidating  Dividends.  If the Company  declares or pays a
dividend upon the Common Stock payable otherwise than in cash out of earnings or
earned surplus  (determined in accordance  with  generally  accepted  accounting
principles,  consistently applied) except for a stock dividend payable in shares
of Common Stock (a "Liquidating Dividend"), then the Company shall allocate, for
the benefit of the  Registered  Holder of this  Warrant,  an amount equal to the
Liquidating  Dividends which would have been payable to such  Registered  Holder
had he, she or it fully exercised this Warrant  immediately  prior to the record
date  applicable  to such  Liquidating  Dividends (or if there be no such record
date,  the date as of which the record  holders of Common Stock entitled to such
dividends are to be determined),  and shall hold such amount, for the benefit of
the  Registered  Holder,  pending the exercise or  expiration  of this  Warrant.
Thereafter, upon the exercise of this Warrant, from time to time, in addition to
the shares of Common Stock  purchased upon such exercise,  the Company shall pay
to the Registered Holder of this Warrant the Liquidating Dividends which pertain
to such purchased shares of Common Stock.  Upon expiration of this Warrant,  any
allocated Liquidating Dividends which pertain to shares of Common Stock issuable
upon exercise of this Warrant but not so purchased  pursuant to exercise will be
retained by the Company.

         Section 4. Purchase Rights.  If at any time the Company grants,  issues
or sells any  Options,  Convertible  Securities  or rights  to  purchase  stock,
warrants,  securities  or other  property pro rata to the record  holders of any
class of Common Stock (the "Purchase  Rights"),  then the  Registered  Holder of
this Warrant  shall be entitled to acquire,  upon the terms  applicable  to such
Purchase  Rights,  the  aggregate  Purchase  Rights which such holder could have
acquired if such holder had held the number of shares of Common Stock acquirable
upon complete  exercise of this Warrant  immediately  before the date on which a
record is taken for the grant,  issuance or sale of such Purchase Rights, or, if
no such record is taken, the date as of which the record holders of Common Stock
are to be determined for the grant,  issue or sale of such Purchase Rights.  For
the avoidance of doubt,  the foregoing shall not apply to either this Warrant or
any  shares  of  Common  Stock  issued  upon the  exercise  of this  Warrant  in
connection with the rights offering that the Company  proposes to make following
the Tranche II Closing.

<PAGE>

         Section 5.  Definitions.  The  following  terms have meanings set forth
below:

                  "Board  of  Directors"  means the  board of  directors  of the
Company.

                  "Business  Day" means any day other than a Saturday,  a Sunday
or a day on which banks in New York City are  authorized  or obligated by law or
executive order to close.

                  "Common  Stock"  means the Common  Stock of the  Company,  par
value $0.001 per share,  and except for purposes of the shares  obtainable  upon
exercise  of this  Warrant,  any  capital  stock  of any  class  of the  Company
hereafter authorized which is not limited to a fixed sum or percentage of par or
stated value in respect to the rights of the holders  thereof to  participate in
dividends or in the distribution of assets upon any liquidation,  dissolution or
winding up of the Company.

                  "Common  Stock  Equivalents"  means all  Options,  Convertible
Securities  and other  options,  rights or warrants to  subscribe  for shares of
Common Stock or other securities that are exercisable  for,  convertible into or
exchangeable for Common Stock,  including without limitation the Company's Class
E Preferred Stock and Class F Preferred Stock.

                  "Convertible   Securities"   means  any  stock  or  securities
(directly or indirectly) convertible into or exchangeable for Common Stock.

                  "Exchange  Act" means the Securities and Exchange Act of 1934,
as amended.

                  "Excluded  Securities"  means  all  Common  Stock  Equivalents
issued and  outstanding  on the date hereof  (including  without  limitation the
1,000,000  Options  issued  to Dr.  Robert  J.  Min and all  additional  Options
issuable to him pursuant to the Patent Purchase Agreement and the EVLT Promotion
Agreement  between  Diomed,  Inc.  and Dr. Min),  up to  5,400,000  Common Stock
Equivalents (expressed on an as-converted into Common Stock basis) issued by the
Company pursuant to the 2003 Omnibus Incentive Plan of the Company,  as the same
may be amended or  supplement  from time to time,  any  additional  or successor
incentive option or other  compensatory  stock-based plan adopted by the Company
and approved by the  stockholders  of the Company;  provided,  such Common Stock
Equivalents  shall be issued in accordance  with the terms and conditions of any
such plan,  together  with any Common Stock or Common Stock  Equivalents  issued
pursuant to the exercise, conversion or exchange of any of the foregoing.

                  "Exercise Price" means the price per share of Common Stock set
forth  herein,  as  adjusted  from time to time  pursuant to the  provisions  of
Section 2.

                  "Fair Market Value" means as to any  security,  the greater of
either (i) the closing  price on the day "Fair Market Value" is to be determined
or (ii) the average of the closing  prices of such  security's  sales on the New
York  Stock  Exchange,  the  American  Stock  Exchange  or  any

<PAGE>

other  domestic  securities  exchanges on which such security may at the time be
listed,  or, if there have been no sales on any such  exchanges  on any day, the
average of the highest bid and lowest asked prices on all such  exchanges at the
end of such day, or, if on any day such  security is not so listed,  the average
of the  representative bid and asked prices quoted in the Nasdaq Stock Market as
of 4:00 P.M., New York time, on such day, or, if on any day such security is not
quoted on the Nasdaq  Stock  Market,  the  average of the highest bid and lowest
asked prices on such day in the domestic  over-the-counter market as reported by
the  National   Quotation  Bureau,   Incorporated,   or  any  similar  successor
organization (collectively, a "Securities Exchange"), in each such case averaged
over a period of three (3) days  consisting  of the day as of which "Fair Market
Value" is being  determined and the two (2)  consecutive  Business Days prior to
such day. If at any time such security is not listed or quoted on any Securities
Exchange,  the "Fair Market  Value" shall be the fair value  thereof  determined
jointly by the Company and the  Registered  Holders of Warrants  representing  a
Majority of the Common Stock  purchasable upon exercise of all the Warrants then
outstanding; provided, that if such parties are unable to reach agreement within
a reasonable period of time, such fair value shall be determined by an appraiser
jointly  selected  by  the  Company  and  the  Registered  Holders  of  Warrants
representing two-thirds of the Common Stock purchasable upon exercise of all the
Warrants then  outstanding.  The  determination of such appraiser shall be final
and binding on the Company and the Registered  Holders of the Warrants,  and the
fees and expenses of such appraiser shall be paid by the Company.

                  "Liquidation Event" means (a) the liquidation,  dissolution or
winding up of the Company,  (b) any merger,  reorganization  or consolidation to
which  the  Company  is  a  party,  except  for  a  merger,   reorganization  or
consolidation  in which the Company is the surviving  Company,  the terms of the
Warrants or Common  Stock are not changed  and neither the  Warrants  nor Common
Stock are exchanged for cash,  securities  or other  property,  and after giving
effect to such  merger,  reorganization  or  consolidation,  the  holders of the
Company's  outstanding  capital stock  possessing a majority of the voting power
(under  ordinary  circumstances)  to elect a majority of the Board of  Directors
immediately prior to the merger,  reorganization or consolidation shall continue
to own the  Company's  outstanding  capital  stock  possessing  the voting power
(under  ordinary  circumstances)  to elect a majority of the Board of Directors,
(c) any sale or  transfer  of more than 50% of the assets of the Company and its
Subsidiaries  on  a  consolidated  basis  (measured  either  by  book  value  in
accordance with generally accepted accounting principles consistently applied or
by fair market value  determined in the  reasonable  good faith  judgment of the
Board of Directors) in any  transaction  or series of  transactions  and (d) any
sale,  transfer or issuance or series of sales,  transfers  and/or  issuances of
Common Stock or other  securities  by the Company or any holders  thereof  which
results in either (i) any  Person or group of  Persons  (as the term  "group" is
used under the Exchange Act),  beneficially  owning (as such term is used in the
Exchange  Act)  more  than 50% of the  Common  Stock  outstanding  or on a fully
diluted basis at the time of such sale, transfer or issuance or series of sales,
transfers and/or issuances or (ii) Persons  beneficially owning the Common Stock
outstanding  or on a fully diluted  basis at the time of such sale,  transfer or
issuance or series of sales, transfers and/or issuances beneficially owning less
than 50% of the Common Stock  outstanding or on a fully diluted basis  following
such sale, transfer or issuance or series of sales, transfers and/or issuances.

<PAGE>

                  "Necessary  Approval  Date" means the later of (a) the date on
which the stockholders of the Company approve the  transactions  contemplated by
that certain Securities Purchase  Agreement,  dated as of August 8, 2003, by and
among the Company and the investors party thereto, and (b) if, and only if, such
approval is necessary,  the date on which the American Stock  Exchange  approves
the transactions contemplated by such Securities Purchase Agreement.

                  "Options"  means any  rights or options  to  subscribe  for or
purchase Common Stock or Convertible Securities.

                  "Person" means an individual, a partnership,  a joint venture,
a  corporation,   a  limited  liability  company,  a  trust,  an  unincorporated
organization and a government or any department or agency thereof.

                  "Qualified Public Offering" means the sale, in an underwritten
public offering  registered  under the Securities Act, of shares of Common Stock
having an  aggregate  value  (based on the  aggregate  proceeds  received by the
Company  in  such  offering,  prior  to  applicable  underwriting  discounts  or
commissions)  of at least  $20,000,000  million,  and  which  are  listed on any
securities  exchange  or  quoted  on  the  Nasdaq  Stock  Market  System  or the
over-the-counter market following such offering.

         Section 6. No Voting  Rights;  Limitations  of Liability.  This Warrant
shall not have any  voting  rights.  No  provision  hereof,  in the  absence  of
affirmative  action by the Registered Holder to purchase Warrant Shares,  and no
enumeration  herein of the rights or privileges of the  Registered  Holder shall
give rise to any liability of such  Registered  Holder for the Exercise Price of
Warrant Shares acquirable by exercise hereof or as a stockholder of the Company.

         Section 7. Warrant  Transferable.  Subject to the  transfer  conditions
referred to in the legend endorsed hereon, this Warrant and all rights hereunder
are transferable,  in whole or in part, without charge to the Registered Holder,
upon surrender of this Warrant with a properly executed  Assignment (in the form
of Exhibit III hereto) at the principal office of the Company.

         Section 8.  Warrant  Exchangeable  for  Different  Denominations.  This
Warrant is exchangeable,  upon the surrender hereof by the Registered  Holder at
the principal office of the Company, for new Warrants of like tenor representing
in the aggregate the purchase  rights  hereunder,  and each of such new Warrants
shall  represent  such portion of such rights as is designated by the Registered
Holder at the time of such surrender.  All Warrants representing portions of the
rights hereunder are referred to herein as the "Warrants."

         Section  9.   Replacement.   Upon   receipt  of   evidence   reasonably
satisfactory  to the Company (an  affidavit  of the  Registered  Holder shall be
satisfactory) of the ownership and the loss, theft, destruction or mutilation of
any certificate evidencing this Warrant, and in the case of any such loss, theft
or  destruction,  upon  receipt  of an  unsecured  indemnity  agreement  of  the
Registered  Holder in form reasonably  satisfactory  to the Company,  or, in the
case of any such  mutilation  upon  surrender of such  certificate,  the Company
shall (at its  expense)  execute and deliver in lieu of such  certificate  a new
certificate of like kind representing the same rights  represented by such lost,
stolen,  destroyed  or  mutilated  certificate  and dated the date of such lost,
stolen, destroyed or mutilated certificate.

<PAGE>

         Section 10. Notices.  Except as otherwise expressly provided hereunder,
all notices referred to herein shall be in writing and shall be (i) delivered in
person,  (ii)  transmitted  by facsimile,  (iii) sent by registered or certified
mail, postage prepaid with return receipt  requested,  or (iv) sent by reputable
overnight courier service,  fees prepaid,  to (x) the Company,  at its principal
executive offices and (y) to any Registered Holder, at such Registered  Holder's
address as it appears in the records of the Company (unless otherwise  indicated
by any such  Registered  Holder).  Notices  shall be deemed given upon  personal
delivery,  upon receipt of return receipt in the case of delivery by mail,  upon
acknowledgment  by the receiving  facsimile or one day following deposit with an
overnight courier service.

         Section 11. Amendment and Waiver.  Except as otherwise provided herein,
the  provisions  of the  Warrants  may be amended  and the  Company may take any
action  herein  prohibited,  or omit to perform  any act herein  required  to be
performed  by it, only if the Company has  obtained  the written  consent of the
Registered Holders of Warrants  representing  two-thirds of the shares of Common
Stock obtainable upon exercise of outstanding Warrants;  provided,  that no such
action may increase the Exercise Price of the Warrants or decrease the number of
shares or class of stock  obtainable  upon exercise of each Warrant  without the
written consent of the Registered  Holders of Warrants  representing 100% of the
shares of Common Stock obtainable upon exercise of the Warrants.

         Section  12.  Warrant  Register.  The  Company  shall  maintain  at its
principal  executive  offices books for the registration and the registration of
transfer of Warrants.  The Company may deem and treat the  Registered  Holder as
the absolute  owner hereof  (notwithstanding  any notation of ownership or other
writing hereon made by anyone) for all purposes and shall not be affected by any
notice to the contrary.

         Section  13.  GOVERNING  LAW.  THIS  WARRANT  SHALL BE  GOVERNED BY AND
CONSTRUED IN  ACCORDANCE  WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT  GIVING
EFFECT TO ITS CONFLICT OF LAWS PRINCIPLES.  THE PARTIES HERETO FURTHER AGREE AND
ACKNOWLEDGE  THAT ANY  DISPUTE OR  CONTROVERSY  ARISING  OUT OF OR IN ANY MANNER
WHATSOEVER  RELATING TO THIS WARRANT SHALL BE BROUGHT IN THE COURTS OF THE STATE
OF NEW YORK OR THE UNITED  STATES OF AMERICA  FOR THE  SOUTHERN  DISTRICT OF NEW
YORK  LOCATED IN THE STATE OF NEW YORK,  AND BY  EXECUTION  AND DELIVERY OF THIS
WARRANT  HEREBY (i) ACCEPTS  THE  JURISDICTION  OF THE  AFORESAID  COURTS;  (ii)
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT OF ANY SUCH COURT WITH RESPECT TO
THIS WARRANT;  AND (iii) IRREVOCABLY  WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY  OBJECTION  WHICH IT MAY NOW OR HEREAFTER  HAVE TO THE LAYING OF VENUE,
COURT,  ACTION OR  PROCEEDING  WITH RESPECT TO THIS WARRANT  BROUGHT IN ANY SUCH
COURT AND FURTHER  IRREVOCABLY  WAIVES ANY SUCH CLAIM THAT ANY SUCH SUIT, ACTION
OR  PROCEEDING  BROUGHT  IN ANY SUCH COURT HAS BEEN  BROUGHT IN AN  INCONVENIENT
FORUM.

<PAGE>

         Section 14.  Headings.  The  headings  of the various  sections of this
Warrant have been  inserted for  reference  only and shall not be deemed to be a
part of this Warrant.

         Section 15. Specific Performance. The Company, on the one hand, and the
Registered  Holder, on the other hand,  acknowledge that money damages would not
be a sufficient remedy for any breach of this Warrant.  It is accordingly agreed
that the parties shall be entitled to specific performance and injunctive relief
as remedies for any such breach,  these remedies being in addition to any of the
remedies to which they may be entitled at law or equity.

         Section 16. Remedies  Cumulative.  Except as otherwise provided herein,
the  remedies  provided  herein shall be  cumulative  and shall not preclude the
assertion  by any party  hereto of any other  rights or the seeking of any other
remedies against any other party hereto.

         Section 17. No Third Party  Beneficiaries.  Except as specifically  set
forth or referred to herein, nothing herein is intended or shall be construed to
confer  upon any  person or  entity  other  than the  parties  hereto  and their
successors  or  assigns,  any  rights  or  remedies  under or by  reason of this
Warrant.

         Section  18.  Severability.   If  any  term,  provision,   covenant  or
restriction of this Warrant is held by a court of competent  jurisdiction  to be
invalid,  void  or  unenforceable,  the  remainder  of  the  terms,  provisions,
covenants and restrictions of this Warrant shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.

         Section 19.  Registration Rights.

                  19.1  Registration  Under  the  Securities  Act of  1933.  The
Warrants, and the shares of Common Stock issuable upon exercise of the Warrants,
have not been  registered  under the  Securities  Act of 1933,  as amended  (the
"Act").  Upon  exercise,  in  part  or in  whole,  of the  Warrant  certificates
representing the shares of Common Stock and any other  securities  issuable upon
exercise of the  Warrants or issuable  pursuant to this  Warrant  (the  "Warrant
Securities") shall bear the following legend:

                  The securities  represented by this  certificate have not been
                  registered  under the  Securities Act of 1933, as amended (the
                  "Act"),  and may not be offered or sold except pursuant to (i)
                  an effective registration statement under the Act, (ii) to the
                  extent applicable, Rule 144 under the Act (or any similar rule
                  under such Act relating to the disposition of securities),  or
                  (iii)  an  opinion  of  counsel,  if  such  opinion  shall  be
                  reasonably  satisfactory  to  counsel to the  issuer,  that an
                  exemption from registration under such Act is available.

<PAGE>

         19.2 Piggyback Registration.  If, at any time commencing after the date
hereof and expiring seven (7) years thereafter, the Company proposes to register
any of its securities  under the Act (other than in connection  with a merger or
pursuant to Form S-8), it will give written notice by registered  mail, at least
thirty (30) days prior to the filing of each such registration statement, to the
Registered Holder of the Warrants and/or the Warrant Securities of its intention
to do so. If the Registered Holder of the Warrants and/or the Warrant Securities
notifies the Company within twenty (20) days after receipt of any such notice of
its or their desire to include any such securities in such proposed registration
statement,  the Company  shall  afford such  Registered  Holder of the  Warrants
and/or  the  Warrant  Securities  the  opportunity  to  have  any  such  Warrant
Securities registered under such registration statement.

         Notwithstanding  the provisions of this Section 19.2, the Company shall
have the right at any time after it shall have given written notice  pursuant to
this Section 19.2  (irrespective  of whether a written  request for inclusion of
any such securities shall have been made) to elect not to file any such proposed
registration  statement,  or to withdraw  the same after the filing but prior to
the effective date thereof.

         19.3 Demand Registration.

              (a) At any time  commencing  after the date  hereof  and  expiring
seven (7) years thereafter, the Registered Holder of the Warrants and/or Warrant
Securities representing a "Majority" (as hereinafter defined) of such securities
(assuming the exercise of all of the Warrants) shall have the right (which right
is  in  addition  to  the  registration   rights  under  Section  19.2  hereof),
exercisable  by written notice to the Company,  to have the Company  prepare and
file with the  Securities and Exchange  Commission  (the  "Commission"),  on one
occasion,  a  registration  statement  and such  other  documents,  including  a
prospectus,  as may be  necessary  in the opinion of counsel for the Company and
counsel for the Registered Holder, in order to comply with the provisions of the
Act,  so as to permit a public  offering  and sale of their  respective  Warrant
Securities for nine (9)  consecutive  months by such  Registered  Holder and any
other Registered Holder of the Warrants and/or Warrant Securities who notify the
Company  within ten (10) days after  receiving  notice  from the Company of such
request.

              (b) The Company covenants and agrees to give written notice of any
registration  request  under this Section 19.3 by any  Registered  Holder to all
other  holders of the Warrants and the Warrant  Securities  within ten (10) days
from the date of the receipt of any such registration request.

              (c) In addition to the registration  rights under Section 19.2 and
subsection  (a) of this  Section  19.3,  at any time  commencing  after the date
hereof and expiring five (5) years thereafter, any Registered Holder of Warrants
and/or Warrant  Securities shall have the right,  exercisable by written request
to the Company, to have the Company prepare and file, on one occasion,  with the
Commission a registration  statement so as to permit a public  offering and sale
for nine (9)  consecutive  months by any such  Registered  Holder of its Warrant
Securities;  provided,  however,  that the provisions of Section  19.4(b) hereof
shall not apply to any such registration  request and registration and all costs
incident thereto shall be at the expense of the Registered  Holder or Registered
Holders making such request.

<PAGE>

              (d) Notwithstanding  anything to the contrary contained herein, if
the  Company  shall not have  filed a  registration  statement  for the  Warrant
Securities  within the time period  specified in Section 19.4(a) hereof pursuant
to the written notice  specified in Section  19.3(a) hereof of a Majority of the
Registered  Holders of Warrants  and/or Warrant  Securities,  the Company agrees
that upon the  written  notice of  election  of a majority of the holders of the
Warrants and/or Warrant  Securities it shall  repurchase (i) any and all Warrant
Securities  at the higher of the Fair Market Value per share of Common Stock (x)
the date of the notice sent pursuant to Section  19.3(a),  or (y) the expiration
of the period specified in Section 19.4(a) and (ii) any and all Warrants at such
Fair Market Value less the exercise price of such Warrant. Such repurchase shall
be in immediately  available funds and shall close within two (2) days after the
later of (i) the expiration of the period specified in Section 19.4(a),  or (ii)
the  delivery  of the  written  notice of  election  specified  in this  Section
19.3(d).

         19.4 Covenants of the Company with Respect to Registration.

         In connection with any registration under Sections 19.2 or 19.3 hereof,
the Company covenants and agrees as follows:

              (a) The Company shall use its best efforts to file a  registration
statement within thirty (30) days of receipt of any demand  therefor,  shall use
its best efforts to have any registration  statement  declared  effective at the
earliest  possible time, and shall furnish each  Registered  Holder  desiring to
sell Warrant  Securities  such number of  prospectuses  as shall  reasonably  be
requested.

              (b) The Company shall pay all costs  (excluding  fees and expenses
of more than one  counsel  for the  Registered  Holder and any  underwriting  or
selling  commissions),  fees and expenses in  connection  with all  registration
statements filed pursuant to Sections 19.2 and 19.3(a) hereof including, without
limitation, the Company's legal and accounting fees, printing expenses, blue sky
fees and expenses.  The Registered  Holder will pay all costs, fees and expenses
in connection with any registration statement filed pursuant to Section 19.3(c).
If the Company shall fail to comply with the provisions of Section 19.4(a),  the
Company shall, in addition to any other  equitable or other relief  available to
the  Registered  Holder,  be  liable  for any and all  incidental,  special  and
consequential  damages  and  damages  due to loss  of  profit  sustained  by the
Registered Holder requesting registration of their Warrant Securities.

              (c) The  Company  will  take all  necessary  action  which  may be
required in  qualifying  or  registering  the Warrant  Securities  included in a
registration  statement  for offering and sale under the  securities or blue sky
laws of such  states as  reasonably  are  requested  by the  Registered  Holder,
provided  that the Company shall not be obligated to execute or file any general
consent to do business under the laws of any such jurisdiction.

              (d) The  Company  shall  indemnify  the  Registered  Holder of the
Warrant  Securities to be sold pursuant to any  registration  statement and each
person,  if any,  who  controls  such  Registered  Holder  within the meaning of
Section 15 of the Act or Section 20(a) of the  Securities  Exchange Act of 1934,
as amended  (the  "Exchange  Act"),  from and against  any and all loss,  claim,
damage,  expense or liability  (including  all expenses  reasonably  incurred in
investigating, preparing or defending against any claim whatsoever) to which any
of them may become subject under the Act, the Exchange Act or otherwise, arising
from such registration statement.

<PAGE>

              (e) The  Registered  Holder of the Warrant  Securities  to be sold
pursuant to a registration  statement,  and their successors and assigns,  shall
severally,  and not jointly,  indemnify the Company,  its officers and directors
and each person,  if any, who controls the Company within the meaning of Section
15 of the Act or Section 20(a) of the Exchange Act, from and against any and all
loss, claim,  damage,  expense or liability  (including all expenses  reasonably
incurred in investigating,  preparing or defending against any claim whatsoever)
to which they may become  subject  under the Act, the Exchange Act or otherwise,
arising from information furnished in writing by or on behalf of such Registered
Holder,  or  their  successors  or  assigns,  for  specific  inclusion  in  such
registration statement.

              (f) Nothing  contained  in this  Agreement  shall be  construed as
requiring the Registered  Holder to exercise their Warrants prior to the initial
filing of any registration statement or the effectiveness thereof.

              (g) The Company shall not permit the  inclusion of any  securities
other than the Warrant  Securities to be included in any registration  statement
filed pursuant to Section 19.3 hereof  without the prior written  consent of the
Registered Holder of the Warrants and Warrant Securities representing a Majority
of such securities (assuming an exercise of all of the Warrants).

              (h)  The  Company   shall  furnish  to  each   Registered   Holder
participating  in the  offering  and to  each  underwriter,  if  any,  a  signed
counterpart,  addressed  to such  Registered  Holder or  underwriter,  of (i) an
opinion of counsel to the Company, dated the effective date of such registration
statement (and, if such registration  includes an underwritten  public offering,
an opinion dated the date of the closing under the underwriting agreement),  and
(ii) a "cold  comfort"  letter  dated the  effective  date of such  registration
statement (and, if such registration includes an underwritten public offering, a
letter dated the date of the closing under the underwriting agreement) signed by
the  independent  public  accountants  who have issued a report on the Company's
financial  statements  included  in such  registration  statement,  in each case
covering  substantially  the same  matters  with  respect  to such  registration
statement  (and  the  prospectus  included  therein)  and,  in the  case of such
accountants'  letter,  with  respect  to events  subsequent  to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants'  letters  delivered to  underwriters in underwritten  public
offerings of securities.

              (i) The Company shall as soon as  practicable  after the effective
date  of  the  registration  statement,  and  in  any  event  within  15  months
thereafter,  make  "generally  available  to its security  holders"  (within the
meaning  of Rule 158 under the Act) an  earnings  statement  (which  need not be
audited)  complying  with  Section  11(a) of the Act and covering a period of at
least  12  consecutive   months  beginning  after  the  effective  date  of  the
registration statement.

<PAGE>

              (j) For  purposes  of  this  Agreement,  the  term  "Majority"  in
reference to the Registered Holder of Warrants or Warrant Securities, shall mean
in excess of fifty  percent  (50%) of the then  outstanding  Warrants or Warrant
Securities  that  (i)  are not  held  by the  Company,  an  affiliate,  officer,
director,  creditor,  employee  or  agent  thereof  or any of  their  respective
affiliates,   members  of  their  family,  persons  acting  as  nominees  or  in
conjunction therewith, or (ii) have not been resold to the public.

              (k) In  addition  to the  Warrant  Securities,  upon  the  written
request  therefor by any  Registered  Holder,  the Company  shall include in the
registration  statement  any  other  securities  of the  Company  held  by  such
Registered  Holder  as of the date of  filing  of such  registration  statement,
including  without  limitation  restricted  shares  of  Common  Stock,  options,
warrants or any other securities  convertible into or exchangeable for shares of
Common Stock.

         Section 20. Entire Agreement;  Modification.  This Warrant contains the
entire  understanding  between  the parties  hereto with  respect to the subject
matter hereof and may not be modified or amended except by a writing duly signed
by the party  against  whom  enforcement  of the  modification  or  amendment is
sought.

         Section  21.  No  Strict   Construction.   The   parties   hereto  have
participated  jointly in the  negotiation  and drafting of this Warrant.  In the
event an ambiguity or question of intent or interpretation  arises, this Warrant
shall  be  construed  as if  drafted  jointly  by  the  parties  hereto,  and no
presumption or burden of proof shall arise favoring or disfavoring  any party by
virtue of the authorship of any of the provisions of this Warrant.

                [THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK]

<PAGE>

                  IN WITNESS WHEREOF,  the Company has caused this Warrant to be
signed and attested by its duly authorized officers under its corporate seal and
to be dated the date hereof.

                                    DIOMED HOLDINGS, INC.

                                    By:    _______________________________
                                           Name:
                                           Title:

<PAGE>

                                                                       EXHIBIT I

         [FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 1.2(a)(iv)]
                 (Exercise and payment by check or securities)

To: Dated:

                  The  undersigned,  pursuant to the provisions set forth in the
attached Warrant  (Certificate  No. W-____),  hereby agrees to subscribe for the
purchase of ____________  shares of the Common Stock covered by such Warrant and
makes payment  herewith in full therefor at the price per share provided by such
Warrant.

                         Signature:_________________________________

                         Address:__________________________________

<PAGE>

                                                                      EXHIBIT II

        [FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 1.2(a)(iv)(3)]
                               (Cashless Exercise)

         The  undersigned  hereby  irrevocably  elects to  exercise  the  right,
represented by this Warrant Certificate, to purchase _________________ shares of
Common Stock all in accordance  with the terms hereof and Section  1.2(a)(iv)(3)
of the Warrant Agreement.  The undersigned  requests that a certificate for such
securities  be  registered  in the  name  of  whose  address  is and  that  such
Certificate    be   delivered   to    __________________    whose   address   is
_____________________.

Dated:

                           Signature _____________________________________

                           (Signature  must  conform in all  respects to name of
                           holder  as  specified  on the  face  of  the  Warrant
                           Certificate.)

                           -----------------------------------------------------
                           (Insert Social Security or Other
                           Identifying Number of Holder)

<PAGE>

                                                                     EXHIBIT III

              [FORM OF ASSIGNMENT PURSUANT TO SECTION 1.2(a)(iii)]

(To be executed by the registered  holder if such holder desires to transfer the
Warrant Certificate.)

     FOR VALUE RECEIVED
hereby sells, assigns and transfers unto

------------------------------------------
(Please print name and address of transferee)

this Warrant  Certificate,  together with all right, title and interest therein,
and hereby irrevocably constitutes and appoints  _______________________________
Attorney,  to  transfer  the  within  Warrant  Certificate  on the  books of the
within-named Company, with full power of substitution.

Dated:

               Signature: ___________________________________

               (Signature  must  confirm  in all  respects  to name of holder as
               specified on the face of the Warrant Certificate.)

               (Insert Social Security or Other Identifying Number of Assignee).<PAGE>

                                                                   Exhibit 10.24

                              EMPLOYMENT AGREEMENT

This EMPLOYMENT  AGREEMENT (the "Agreement"),  dated as of July 31, 2003, by and
between GWIN, Inc., a Delaware corporation ("the Company") located at 5092 South
Jones Blvd.,  Las Vegas,  Nevada 89118,  and Wayne Allyn Root,  whose address is
Anthem Country Club, 4 Bloomfield Hills Drive,  Henderson,  Nevada 89052,  ("the
Executive"), and is based upon the following:

                                    RECITALS

         WHEREAS,  the  Executive is  currently  acting as the  Company's  Chief
Executive  Officer and Chairman of the Company's  Board of Directors  ("Board of
Directors");

         WHEREAS,  the Company  wishes to retain the services of the  Executive,
and the Executive  wishes to render services to the Company,  as Chief Executive
Officer;

         WHEREAS,  the  Company  and the  Executive  wish to set  forth  in this
Agreement  the  duties and  responsibilities  that the  Executive  has agreed to
undertake  on behalf of the Company in his role as its Chief  Executive  Officer
only;

         WHEREAS,  the Company and the Executive intend that this Agreement will
supersede and replace any and all other  employment  agreements or  arrangements
for employment  entered into by and between the Company and the  Executive,  and
that any such employment  agreements or arrangements shall have no further force
or effect.

         NOW,  THEREFORE,  in  consideration  of the foregoing and of the mutual
promises  contained in this  Agreement,  the Company and the Executive  (who are
sometimes  individually referred to as a "party" and collectively referred to as
the "parties") agree as follows:

                                    AGREEMENT

1. SPECIFIED PERIOD AND OFFICE LOCATION/HEADQUARTERS.

   The Company hereby employs the  Executive,  and the Executive  hereby accepts
employment with the Company,  pursuant to the terms of this Agreement  beginning
on July 31,  2003 the  "Effective  Date"  and  expiring  on July 31,  2005  (the
"Term").  The Company will provide the  Executive  with his own office and staff
and pay for the office,  staff and all facilities and equipment  required by the
Executive and his staff.

2. GENERAL DUTIES.

<PAGE>

    The  Executive  shall  devote  sufficient   productive  time,  ability,  and
attention to the Company's  business during the term of this  Agreement.  In his
capacity  as Chief  Executive  Officer,  the  Executive  shall have the  overall
responsibility  for the  day-to-day  supervision,  control and management of the
business and the  employees  of the Company.  The  Executive  shall  conduct and
perform all services,  acts,  or things  necessary or advisable to discharge his
duties under this Agreement,  and such other duties as are commonly performed by
a Chief Executive  Officer of a publicly  traded  corporation of the size of the
Company or which may, from time to time,  be  prescribed by the Company  through
the Board of Directors  consistent with his duties as a Chief Executive Officer.
Furthermore,  the  Executive  agrees to  cooperate,  and work to the best of his
ability,  with the  Company's  management  team,  which  includes  the  Board of
Directors,  officers and other employees,  to continually  improve the Company's
reputation  in its.  Executive  shall be entitled to host a  television  and/or
radio show,  write  newspaper  articles  and/or books and  participate  in other
business ventures  provided the same do not compete with the Company's  business
or materially interfere with Executive's duties set forth in this Agreement.

3. AUTHORITY, HUMAN, AND CAPITAL RESOURCES.

    The Executive shall have authority to hire, fire, train and manage the staff
of the  Company  as  well  as to  negotiate  and  execute  contracts  and  other
documents.  Should any single contract encompass  commercial  commitments in the
amount of $50,000 or more,  such  authority  shall be subject to approval by the
Board of Directors  prior to execution of any such  contract.  The Company shall
provide the Executive with the human and capital resources  (including,  but not
limited  to,  development  funding,   equity  investment,   debt-financing)  and
dedicated  management  support staff (including,  but not limited to, technical,
financial,  legal,  tax,  accounting)  required  to promote  the  mission of the
Company and execute the  business  plan and the  requisite  tools and  resources
needed to perform the Company's  business  (including,  but not limited to, cell
phones, computer, Internet, office supplies).

4. COMPENSATION.

       (a) Base Salary. During the first year of the Term, the Company shall pay
       to the Executive a base salary of $175,000 per year, in equal consecutive
       monthly  installments  of $14,583.33 per month (the "Base Salary") on the
       first of each month for the prior  month of work.  In the second  year of
       the Term, the Base Salary shall be 10% of the Company's  operating income
       ("Operating   Income")   pursuant  to  the  Company's  audited  financial
       statements  determined and calculated per Generally  Accepted  Accounting
       Principles ("GAAP") for the previous fiscal year; provided, however, that
       in no event shall the  Executive's  salary fall below  $175,000 or exceed
       $250,000.  Once the increased Base Salary level is reached,  it shall not
       be  reduced  for any  reason.  The Base  Salary  shall be  subject to any
       applicable federal or state tax withholdings and/or employee deductions.

<PAGE>

       (b)  Handicapping  Fees.  During the first year of the Term,  the Company
       shall pay to the Executive a handicapping  fee (the  "Handicapping  Fee")
       equal to 10% of the Executive's  handicapping  fees (net of charge backs)
       received by the  Company,  not to exceed a maximum of $350,000  per year.
       Commencing with the second year of the Term, the  Handicapping  Fee shall
       be the greater of $450,000 or 20% of the Company's  Operating  Income for
       that fiscal year (the twelve  month  period  ending on July 31, 2005) per
       GAAP. The payment if based on the Operating Income shall be made upon the
       filing of the  10-KSB or other  similar  form the  Company  may use.  The
       Handicapping  Fee shall be subject  to any  applicable  tax  withholdings
       and/or employee deductions.

       (c)  Performance  Bonus.  In the second year of the Term,  the  Executive
       shall be entitled to a performance bonus (the  "Performance  Bonus") from
       the Company's performance bonus pool, which shall consist of:

           A)         10% of the  Company's  Operating  Income,  in excess of $1
                      million,  as set forth in the Company's  audited financial
                      statements for the applicable fiscal year per GAAP; and

           B)         50% of the company's operating profit margin, in excess of
                      15%,  as set  forth  in the  Company's  audited  financial
                      statements for the applicable fiscal year per GAAP.

         In the second year of the term, the Executive  shall be entitled to the
         Performance Bonus equal to 25% of the aggregate  performance bonus pool
         for that  year  subject  to any  applicable  federal  or state tax with
         holdings and/or employee deductions.

         (d) Common Stock Grant.

              As an incentive for  continued  employment  with the Company,  the
         Executive  shall be  entitled  to a stock  grant of  restricted  common
         shares of Company in the amount of  2,100,000  shares  (the  "Shares"),
         which  shall  Vest  as  follows:  700,000  Shares  at  signing  of this
         Agreement.  700,000 Shares on the 1st  anniversary  of this  Agreement.
         700,000  Shares  on the 2nd  anniversary  of this  Agreement.  Once the
         initial Shares vest at signing,  additional shares are earned "only" by
         continued  employment with the Company through the anniversary  date or
         change of ownership  or control.  The Shares will then be vested in the
         name of the  Executive  and  issued  as fully  paid by the  Company  as
         conditional compensation.

         (e) Change of ownership compensation.

         In the event of a change in ownership or control of the Company, either
         friendly or hostile, Executive shall immediately receive a minimum base
         salary of $250,000 per year, the Handicapping Fee shall be increased to
         12% of sales (as  described  in  paragraph  4. b ), the ceiling for the
         Handicapping  Fee shall be removed and all  remaining  unvested  Shares
         shall immediately vest and issued effective as of the date in change of
         ownership control.

<PAGE>

         (f) Executive  benefit plans.  During the Term of this  Agreement,  the
         Executive  shall  participate   equally  with  other  senior  executive
         employees in any retirement,  pension,  profit sharing,  insurance,  or
         other  plans  which may now be in effect or which may be adopted by the
         Company  pursuant to the terms of each plan. The benefit plans shall be
         with such underwriters and shall contain such provisions as the Company
         and the Executive may determine from time to time. Insurance provisions
         shall cover the Executive and his immediate family,  including, but not
         limited to, term life, long-term disability,  medical,  dental, vision,
         and other related  benefits.  In addition,  the amount of the "Key Man"
         life insurance policy maintained by the Company naming the Executive as
         insured  shall be increased  to  $10,000,000  subject to the  Company's
         financial  condition  and capital  resources  in  conjunction  with the
         availability of an insurance carrier willing to provide such coverage.

         (g) Voluntarily  Surrender of Options & Warrants
         The Executive  acknowledges that as consideration for issuing the stock
         grants described in( 4. d) by the Company the Executive shall surrender
         all written options and warrants issued prior to July 31,2003.

5. REIMBURSEMENT OF BUSINESS EXPENSES.

    The Company  shall  reimburse  the  Executive  for all  reasonable  business
expenses  incurred  by the  Executive  in  connection  with the  business of the
Company  within 10 (ten) days  following  the  submission  of an expense  report
documenting  expenses.  Each such expenditure  shall be reimbursable only if the
Executive furnishes to the Company such documentary  evidence as may be required
by federal and state statutes and regulations  issued by the appropriate  taxing
authorities  for the  substantiation  of each such  expenditure as an income tax
deduction.

6. ANNUAL VACATION/HOLIDAY/SICK LEAVE.

    During the Term,  the  Executive  shall be entitled to 6 weeks paid vacation
per year,  which  vacation  time shall not be taken until the  expiration  of at
least 90 days from the Effective  Date.  The Executive  shall be entitled to all
holiday and sick leave in accordance with the Company's  general policy for it's
employees.  The Executive  shall be entitled to take the Christmas week off with
pay.

7. INDEMNIFICATION OF LOSSES.

    So  long  as the  Executive's  actions  were  taken  in  good  faith  and in
furtherance  of the Company's  business and within the scope of the  Executive's
duties  and  authority,  the  Company  shall  indemnify  and hold the  Executive
harmless from any and all claims, losses and expenses sustained by the Executive
as a result of any action taken by him in connection  with his duties under this
Agreement, and the Company shall defend the Executive, at the Company's expense,
in connection with any and all claims by stockholders or third parties which are
based upon actions taken by the pursuant to this agreement to the full extent of
Delaware law.

<PAGE>

8. PERSONAL CONDUCT.

    Except as set forth in paragraph 2 of this Agreement,  the Executive  agrees
promptly and faithfully to comply with all present and future written  policies,
requirements,  directions,  requests,  rules and  regulations  of the Company in
connection with the Company's  business  provided to him. The Executive  further
agrees to conform to all laws and shall not at any time commit any act or become
involved in any  situation  or  occurrence  which brings the Company into public
scandal,  ridicule or which will reflect  unfavorably  on the  reputation of the
Company.

9. TERMINATION FOR CAUSE.

    The Company  reserves the right to declare the  Executive in default of this
Agreement if the Executive fails to adequately  perform or willfully breaches or
habitually  neglects the material  duties which he is required to perform  under
the terms of this Agreement,  or if the Executive  commits such material acts of
dishonesty, fraud, misrepresentation,  gross negligence or willful misconduct as
would  prevent  the  effective  performance  of his  duties or which  results in
material  harm to the  Company or  business.  The  Company  may  terminate  this
Agreement for cause by giving written notice of termination to the Executive. If
the Executive's failure, breach or violation is of a nature that is curable, the
Executive shall have fifteen business days after written notice of such failure,
breach  or  violation  is given to him to  affect  the cure  thereof.  Upon such
termination  the  obligations  of the  Executive  and  the  Company  under  this
Agreement shall  immediately  cease. Such termination shall be without prejudice
to any other  remedy to which the  Company  may be  entitled  either at law,  in
equity,  or under this Agreement.  If the  Executive's  employment is terminated
pursuant to this paragraph, the Company shall pay to the Executive,  immediately
upon such  termination,  any  accrued  but unpaid  amounts  earned  pursuant  to
Sections 4, 5 and 6.

10. TERMINATION WITHOUT CAUSE.

         (a) Death. The Executive's employment shall terminate upon the death of
         the Executive. Upon such termination,  the obligations of the Executive
         and the Company under this Agreement shall  immediately cease except as
         hereinafter set forth.  In the event of a termination  pursuant to this
         section, the Executive shall be entitled to receive any amounts accrued
         but  unpaid  pursuant  to  Sections  4, 5 & 6 of  this  Agreement.  The
         Executive's successors, heirs, representatives and/or executor(s) shall
         be entitled to exercise  the stock  grants  provided for in paragraph 4
         following  the death of the  Executive.  All other rights the Executive
         has under any  benefit  or stock  option  plans and  programs  shall be
         determined  in accordance  with the terms and  conditions of such plans
         and programs.

<PAGE>

         (b)  Disability.  The  Company  reserves  the  right to  terminate  the
         Executive's  employment  upon 10 (ten)  days  written  notice if, for a
         consecutive  period of 60 (sixty) days, the Executive is prevented from
         discharging  his duties  under this  Agreement  due to any  physical or
         mental  disability.  Upon  such  termination  the  obligations  of  the
         Executive and the Company under this Agreement shall immediately cease.
         In the event of a termination pursuant to this section as the Executive
         shall be entitled to receive  any  accrued  and unpaid  amounts  earned
         pursuant to section 4,5 & 6. All other rights the  Executive  has under
         any benefit or stock option plans and programs  shall be  determined in
         accordance with the terms and conditions of such plans and programs.

         (c) Election By The Executive. The Executive may elect to terminate his
         employment  at any time upon not less than 60  (sixty)  days  following
         written  notice  by the  Executive  to the  Board.  In the  event  of a
         termination  pursuant to this section,  the Executive shall be entitled
         to receive any accrued and unpaid amounts earned pursuant to Section 4,
         5 & 6. All other  rights the  Executive  has under any benefit or stock
         option plans and programs  shall be determined  in accordance  with the
         terms and conditions of such plans and programs.

         (d)  Election  By The  Company  and  Termination  Fee.  The Company may
         terminate the Executive's employment upon not less that 60 (sixty) days
         written  notice  by the  Company  to the  Executive.  In the event of a
         termination  pursuant to this section,  the Executive shall be entitled
         to receive  any  accrued and unpaid  amounts  earned and stock  options
         granted  pursuant to Section 4, 5 & 6. All other  rights the  Executive
         has under any  benefit  or stock  option  plans and  programs  shall be
         determined  in accordance  with the terms and  conditions of such plans
         and programs. In addition, within 10 (ten) days following the effective
         date of termination,  the Company shall pay the Executive a termination
         fee in an amount equal to 12 (twelve)  months of the  Executive's  Base
         Salary (as that term is defined in section  4(a),  which the  Executive
         receives as of the date of termination.

         (e)  Termination  By The Executive  For Good Reason.  The Executive may
         terminate   this   agreement   immediately   based  on  his  reasonable
         determination that one of the following events has occurred:

                  (i) The  Company  intentionally  and  continually  breaches or
                  wrongfully  fails to fulfill or perform  (A) its  obligations,
                  promises  or  covenants  under  this  Agreement;  or  (B)  any
                  warranties,   obligations,   promises  or   covenants  in  any
                  agreement (other than this agreement) entered into between the
                  Company and the Executive, without cure;

                  (ii) The Company terminates this Agreement and the Executive's
                  employment hereunder, and such termination does not constitute
                  termination for cause,

<PAGE>

                  (iii) Without the consent of the Executive,  the Company:  (A)
                  substantially  alters or materially  diminishes  the position,
                  nature, status,  prestige or responsibilities of the Executive
                  or location of the Executive's office then in effect by mutual
                  agreement of the  parties;  (B) assigns  additional  duties or
                  responsibilities  to the Executive which are inconsistent with
                  the position,  nature, status, prestige or responsibilities of
                  the  Executive  then  in  effect;  (C)  removes  or  fails  to
                  reappoint or re-elect the Executive to the Executive's offices
                  under this Agreement (as they may be changed or augmented from
                  time-to-time  with  the  consent  of the  Executive),  or as a
                  director  of  the  Company,  except  in  connection  with  the
                  Executive's  disability;  and (D)  changed  the  nature of its
                  business operations;

                  (iv) The  Executive  is  removed  from the Board  without  his
                  consent;  or the Company  fails to nominate or  reappoint  the
                  Executive  to the Board  (unless the  Executive is deceased or
                  disabled,  or such  removal or failure is  attributable  to an
                  event which would constitute termination for cause), or if the
                  Executive is so  nominated,  the  stockholders  of the Company
                  fail to re-elect the Executive to the Board;

                  (v) The Company intentionally requests or causes the Executive
                  to commit or participate in any felony or other serious crime;
                  and/or

                  (vi) The Company engages in other conduct  constituting  legal
                  cause for termination.

                  (vii) The Company files for  protection  under the  Bankruptcy
                  laws of the United States.

           If the Executive  terminates this Agreement pursuant to this Section,
           the obligations of the Executive and the Company under this Agreement
           shall  immediately  cease. In the event of a termination  pursuant to
           this section,  the Company shall pay the Executive a termination  fee
           in an amount  equal to 12  (twelve)  months of the  Executive's  Base
           Salary  (as the term is  defined  in  paragraph  4(a)) at the time of
           termination.  All other  rights the  Executive  has under  benefit or
           stock option plans and programs  shall be  determined  in  accordance
           with the terms and conditions of such plans and programs.

11. COVENANTS NOT TO COMPETE OR SOLICIT.

      Based upon the  Executive's  unique and essential value to the Company and
the receipt of the  compensation as set forth in this  Agreement,  the Executive
agrees to the following covenants and/or restrictions  following the termination
of his employment with the Company where such  termination  results from (a) the
Executive's  voluntary  election to terminate his employment with the Company as
defined in Section 10(c) or (b) the  Executive's  termination by the Company for
cause as defined in Section 9 above. In only those events,  the Executive hereby
covenants and agrees that for a period of 18 (eighteen)

<PAGE>

months from the date of the termination of the  Executive's  employment with the
Company as defined  above,  the Executive  shall not,  without the prior written
consent of the Company  (which  consent may be withheld in the sole and absolute
discretion  of  the  Company),  directly  or  indirectly,  either  alone  or  in
association or in connection with or on behalf of any person, firm, partnership,
corporation,  venture or other entity now existing or hereafter created:  (i) be
or become interested or engaged in, directly or indirectly, with any Competitive
Business including, without limitation, as on organizer, partner, joint-venture,
stockholder,    officer,   director,   employee,   manger,   independent   sales
representative,  associate,  consultant,  or agent  of, or a  supplier,  lender,
vendor,  vendee,  lesser,  or lessee to, any Competitive  Business;  (ii) in any
manner  associate with, aid or give  information or financial  assistance to any
Competitive  Business  or (iii) use or permit  the use of the  Executive's  name
(Wayne Root) or any part thereof to be used or employed in  connection  with any
Competitive Business. The term "Competitive Business" is defined as any business
that is competitive  with the Company's  Business as of the date of termination,
whether such business is conducted by a proprietorship, partnership, corporation
or other form of entity or venture;  provided,  however, that the exclusions set
forth in paragraph 2 of this  Agreement  shall not be considered as an aspect of
the  "Competitive  Business" or  "Company's  Business."  The  Executive  further
covenants and agrees that for a period of 18 (eighteen)  months from the date of
the termination of the Executive's employment with the Company as defined above,
the Executive  shall not,  either for the Executive's own account or directly or
indirectly  in  conjunction  with  or on  behalf  of  any  person,  partnership,
corporation or other entity or venture, solicit any customer,  account, officer,
partner,  manager,  agent or  employee  of the  Company or any of the  Company's
business;  (ii) the covenants or restrictions  embodied herein relate to matters
which are of a special,  unique and  extraordinary  value;  and (iii) a material
breach of any of the  covenants or  restrictions  embodies  herein may result in
irreparable  harm and  damages  which  cannot  be  adequately  compensated  by a
monetary award.

12. ELECTION TO BOARD OF DIRECTORS.

      As of the Effective  Date, the Executive shall be duly elected as Chairman
of the  Company's  Board of Directors.  A resolution  by the Company's  Board of
Director of such election shall be adopted and provided for in writing.

13. NO CONFLICTING DUTIES.

      The  Executive  shall devote  sufficient  productive  time,  ability,  and
attention to the business of the Company  during the term of this Agreement in a
manner  that will  serve the best  interests  of the  Company.  During  the term
hereof,  the  Executive  shall  not  serve as an  officer,  director,  employee,
consultant or advisor to any other business without the prior written consent of
the Company's Board of Directors.  The Executive  hereby confirms he is under no
contractual  commitments  inconsistent  with his  obligations  set forth in this
Agreement.  During the term of this Agreement, and except as otherwise set forth
in  paragraph  2 of this  Agreement,  the  Executive  will not render or perform
services, or enter into any contract to do so, for any other corporation,  firm,
entity or person that are  inconsistent  with the provisions of this  Agreement.
This  Agreement  shall not be  interpreted to prohibit the Executive from making
passive personal investments or engaging in personal or charitable activities.

<PAGE>

14. MISCELLANEOUS.

         (a)  Preparation of Agreement.  It is  acknowledged  by each party that
         such party either had separate and independent advice of counsel or the
         opportunity  to avail  itself or himself of it. In light of these facts
         it is  acknowledged  that no party  shall  be  construed  to be  solely
         responsible for the drafting hereof,  and therefore any ambiguity shall
         not be  construed  against any party as the alleged  draftsman  of this
         Agreement.

         (b) Cooperation.  Each party agrees, without further consideration,  to
         cooperate and diligently perform any further reasonable acts, deeds and
         things and to execute and deliver any  documents  that may from time to
         time be  reasonably  necessary  or  otherwise  reasonably  required  to
         consummate,   evidence,   confirm  and/or  carry  out  the  intent  and
         provisions of this Agreement, all without undue delay or expense.

         (c) Interpretation.

                  (i) Entire Agreement/No Collateral Representations. Each party
                  expressly acknowledges and agrees that this Agreement:  (1) is
                  the final,  complete and exclusive  statement of the agreement
                  of the parties with respect to the subject matter hereof;  (2)
                  supersedes any prior or contemporaneous agreements,  promises,
                  assurances,   guarantees,   representations,   understandings,
                  conduct, proposals,  conditions,  commitments, acts, course of
                  dealing,  warranties,  interpretations  or terms of any  kind,
                  oral  or  written  (collectively  and  severally,  the  "Prior
                  Agreements"),  except  Option  Agreements,  and  that any such
                  Prior Agreements are of no force or effect except as expressly
                  set forth herein;  and (3) may not be varied,  supplemented or
                  contradicted by evidence of Prior  Agreements,  or by evidence
                  of subsequent oral  agreements.  Any agreement  hereafter made
                  shall be  ineffective  to modify,  supplement or discharge the
                  terms of this  Agreement,  in whole  or in part,  unless  such
                  agreement  is in writing and signed by the party  against whom
                  enforcement of the modification or supplement is sought.

                  (ii) Waiver.  No breach of any  agreement or provision  herein
                  contained,  or of any obligation under this agreement,  may be
                  waived, nor shall any extension of time for performance of any
                  obligations  or acts  be  deemed  an  extension  of  time  for
                  performance of any other obligations or acts contained herein,
                  except by written instrument signed by the party to be charged
                  or as otherwise expressly  authorized herein. No waiver of any
                  breach of any agreement or provision herein contained shall be
                  deemed a waiver of any preceding or succeeding breach thereof,
                  or a  waiver  or  relinquishment  of any  other  agreement  or
                  provision or right or power herein contained.

<PAGE>

                  (iii)  Remedies  Cumulative.  The remedies of each party under
                  this  Agreement are cumulative and shall not exclude any other
                  remedies to which such party may be lawfully entitled.

                  (iv) Severability.  If any term or provision of this Agreement
                  or the  application  thereof  to any  person  or  circumstance
                  shall, to any extent, be determined to be invalid,  illegal or
                  unenforceable  under present or future laws  effective  during
                  the term of this agreement,  then and, in that event:  (A) the
                  performance  of the offending  term or provision  (but only to
                  the  extent   it's   application   is   invalid,   illegal  or
                  unenforceable)  shall  be  excused  as if it  had  never  been
                  incorporated into this Agreement, and, in lieu of such excused
                  provision,  there  shall be added a  provision  as  similar in
                  terms and amount to such excused  provision as may be possible
                  and be legal,  valid and  enforceable,  and (B) the  remaining
                  part of  this  Agreement  (including  the  application  of the
                  offending term or provision to persons or circumstances  other
                  than  those  as  to  which  it is  held  invalid,  illegal  or
                  unenforceable)   shall  not  be  affected  thereby  and  shall
                  continue  in full  force  and  effect  to the  fullest  extent
                  provided by law.

                  (v) No Third Party Beneficiary.  Notwithstanding anything else
                  herein to the contrary,  the parties  specifically disavow any
                  desire or  intention  to create  any third  party  beneficiary
                  obligations,  and  specifically  declare  that  no  person  or
                  entity, other than as set forth in this agreement,  shall have
                  any rights hereunder or any right of enforcement hereof.

                  (vi) Headings; References; Incorporation; Gender. The headings
                  used  in this  Agreement  are for  convenience  and  reference
                  purposes  only,  and  shall  not  be  used  in  construing  or
                  interpreting  the  scope or intent  of this  agreement  or any
                  provision  hereof.  References to this Agreement shall include
                  all amendments or renewals thereof.  Any exhibit referenced in
                  this agreement  shall be construed to be  incorporated in this
                  Agreement.  As used in this  Agreement,  each gender  shall be
                  deemed to include the other gender,  including neutral genders
                  or genders  appropriate for entities,  if applicable,  and the
                  singular  shall be  deemed to  include  the  plural,  and vice
                  versa, as the context requires.

                  (vii) Binding Upon Successors. This Agreement shall be binding
                  upon   the   parties'   successors,    assigns,    purchasers,
                  representatives and heirs.

         (d) Enforcement.

                  (i) Applicable Law. This Agreement and the rights and remedies
                  of each party  arising out of or  relating  to this  Agreement
                  (including,  without limitation,  equitable remedies) shall be
                  solely  governed by,  interpreted  under,  and  construed  and
                  enforced in accordance  with the laws  (without  regard to the
                  conflicts of law  principles  thereof) of the State of Nevada,
                  as if this agreement were made, and if it's obligations are to
                  be performed, wholly within the State of Nevada.

<PAGE>

                  (ii) Consent to Jurisdiction;  Service of Process.  Any action
                  or  proceeding  arising out of or  relating to this  Agreement
                  shall be filed in and litigated solely before the state courts
                  of Nevada located within Clark County.

                  (iii) Consent to Specific  Performance  and Injunctive  Relief
                  and Waiver of Bond or Security.  Each party  acknowledges that
                  the Company,  as result of the Executive's  material breach of
                  the covenants and  obligations  included  herein,  may sustain
                  immediate and long-term substantial and irreparable injury and
                  damage that cannot be reasonably or adequately  compensated by
                  damages at law.  Each party agrees  that,  in the event of the
                  Executive's  breach or threatened  breach of the covenants and
                  obligations,  the Company shall be entitled to seek  equitable
                  relief from a court of competent  jurisdiction  or arbitration
                  without  proof of any actual  damages that have been or may be
                  caused to the Company by such breach or threatened  breach and
                  the posting of bond or other security in connection  therewith
                  shall be made in accordance with Nevada law.

         (e) No Assignment  of Rights or Delegation of Duties by the  Executive.
         The  Executive's  rights and benefits under this Agreement are personal
         to him and  therefore  (i) no such right or benefit shall be subject to
         voluntary or involuntary alienation,  assignment or transfer, except as
         provided  herein;  and (ii)  Executive  may not  delegate his duties or
         obligations hereunder.

         (f) Notices.

            Unless  otherwise  specifically  provided  in  this  Agreement,  all
         notices, demands, requests,  consents, approval or other communications
         (collectively and severally called "Notices")  required or permitted to
         be given hereunder,  or which are given with respect to this agreement,
         shall be in  writing,  and shall be given  by:  (A)  personal  delivery
         (which  form of  Notice  shall  be  deemed  to  have  been  given  upon
         delivery),  (B) by private  airborne/overnight  delivery service (which
         forms of  Notice  shall be deemed to have  been  given  upon  confirmed
         delivery by the delivery  agency),  (C) by  electronic  or facsimile or
         telephonic transmission,  provided the receiving party has a compatible
         device or confirms  receipt  thereof  (which  forms of Notice  shall be
         deemed  delivered  upon  confirmed   transmission  or  confirmation  of
         receipt),  or (D) by mailing in the Unites States mail by registered or
         certified mail, return receipt requested,  postage prepaid (which forms
         of Notice  shall be deemed to have been given upon the 5th business day
         following the date mailed).  Each party, and their respective  counsel,
         hereby  agrees that if Notice is to be given  hereunder by such party's
         counsel may communicate  directly with all  principals,  as required to
         comply with the foregoing notice provisions. Notices shall be addressed
         to the address  hereinabove set forth in the introductory  paragraph of
         this  agreement,  or to such other address as the receiving party shall
         have specified  most recently by like Notice,  with a copy to the other
         parties  hereto.  Any  Notice  give to the  estate of a party  shall be
         sufficient if addressed to the party as provided in this subparagraph.

<PAGE>

         (g) Counterparts.  This Agreement may be executed in counterparts, each
         of  which  shall  be an  original,  and  all of  which  together  shall
         constitute one and the same instrument,  binding on all parties hereto.
         Any  signature  page  of  this  agreement  may  be  detached  from  any
         counterpart of this  Agreement and reattached to any other  counterpart
         of this Agreement identical in form hereto by having attached to it one
         or more additional signature pages.

         (h)  Execution  by All Parties  required to be Binding,  Electronically
         Transmitted  Documents.  This Agreement shall not be construed to be an
         offer and shall have no force and effect until this  agreement is fully
         executed  by all  parties  hereto.  If a copy  or  counterpart  of this
         Agreement  is  originally  executed  and such  copy or  counterpart  is
         thereafter  transmitted  electronically by facsimile or similar device,
         such  facsimile  document  shall  for all  purposes  be  treated  as if
         manually signed by the party whose facsimile signature appears.

         Agreed and Accepted this  31st day of July 2003

         --------------------                           ---------------------
         Wayne A Root                                   GWIN,Inc

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