Exhibit
10.2
AMENDMENT TO SERIES J-A WARRANT
TO PURCHASE SHARES OF
COMMON STOCK NUMBER
W-JA-07-1
This Amendment to Series J-A Warrant
to Purchase Shares of Common Stock Number W-JA-07-1 (the
“Series J-A Warrant Amendment”) is entered into as of
the Effective Date (as defined below), by and between NovaRay
Medical, Inc., a Delaware corporation (the “Issuer”)
and Vision Opportunity Master Fund (“Vision”). All
capitalized terms not otherwise defined herein shall have the
meaning ascribed to them in that certain Series J-A Warrant to
Purchase Shares of Common Stock Number W-JA-07-1 issued as of
December 27, 2007 (the “Series J-A
Warrant”).
RECITALS
WHEREAS, pursuant to the Letter
Agreement dated as of August 29, 2008 (the “Letter
Agreement”), Vision agrees to exercise the Series J Warrant
(as defined therein) as amended by the Series J Warrant Amendment
(as defined therein) as to at least 1,872,660 shares of the
Issuer’s Series A Convertible Preferred Stock on or prior to
September 8, 2008 such that Issuer receives proceeds of at
least $5,000,002.20;
WHEREAS, the Issuer and Vision
desire to amend the Series J-A Warrant to provide an initial
maximum number of shares exerciseable under the Series J-A Warrant
to 1,248,440 shares of the Issuer’s Common Stock and to
decrease the Warrant Price as defined therein to $4.25 and to
increase such initial maximum number of shares exerciseable under
the Series J-A Warrant by 1,872,660 shares of the Issuer’s
Common Stock and to decrease the Warrant Price for such shares to
$5.00 subject to both the exercise by Vision of the Series J
Warrant as amended by the Series J Warrant Amendment as to at least
1,872,660 shares of the Issuer’s Series A Convertible
Preferred Stock and receipt by Issuer of proceeds of at least
$5,000,002.20 on or prior to September 8, 2008;
NOW, THEREFORE, in compliance with
Section 10 of the Series J-A Warrant and in consideration of
the mutual promises and covenants set forth herein and in the
Series J-A Warrant, the Company and Vision hereby agree as
follows:
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1.
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Vision
represents that it has not transferred or assigned the Series J-A
Warrant or any part thereof to any third party.
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2.
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The first
paragraph of the Series J-A Warrant is hereby amended to read in
its entirety:
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“FOR VALUE RECEIVED, the
undersigned, NOVARAY MEDICAL, INC., a Delaware corporation
(together with its successors and assigns, the
“Issuer”), hereby certifies that Vision Opportunity
Master Fund, Ltd. (“Vision”) or its registered assigns
is entitled to subscribe for and purchase, during the Term (as
hereinafter defined), up to that number of shares of the duly
authorized, validly issued, fully paid and non-assessable Common
Stock of the Issuer determined by dividing the number of shares of
Preferred Stock issued upon exercise of the Series J Warrant
(as defined in the Purchase Agreement) by the Holder divided by
(3), rounded down to the nearest whole share, up to an initial
maximum of one million two hundred forty-eight thousand four
hundred forty (1,248,440) shares (but subject to adjustment as
hereinafter provided) (the “Initial Exercise Shares”),
at an exercise price per share equal to the Warrant Price then in
effect, subject, however, to the provisions and upon the terms and
c
