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Multimode rate equations have been used to investigate the response to a step current pulse of a semiconductor laser with built-in lateral waveguide. General expressions are given for the frequency and damping time of relaxation oscillations allowing for both gain and total spontaneous emission rate to have arbitrary dependences on carrier concentration. The exchange of power between dominant longitudinal modes, which occurs as a result of the peak gain shift with oscillating carrier concentration, is shown to occur on a time scale controlled by the damping time. The power exchange and the eventual domination by one or other mode are extremely sensitive to one key parameter Â¿ the wavelength displacement between peak gain and the adjacent Fabry-PÃ©rot mode.