Document:

Amendment To Series J Warrant

 Exhibit 10.1 
 AMENDMENT TO SERIES J WARRANT TO PURCHASE SHARES OF 
 SERIES A CONVERTIBLE
PREFERRED STOCK NUMBER W-J-07-1 
 This Amendment to Series J Warrant to Purchase Shares of Series A Convertible Preferred Stock Number
W-J-07-1 (the “Series J Warrant Amendment”) is entered into as of the Effective Date, 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 Warrant to Purchase Shares of Series A Convertible Preferred Stock Number W-J-07-1 issued as of December 27, 2007 (the “Series
J Warrant”). 
 RECITALS 
 WHEREAS, the Issuer issued to Vision the Series J Warrant exerciseable into up to 2,309,468 shares of the Issuer’s Series A Convertible Preferred Stock at an exercise price equal to the Warrant Price then in effect; 
 WHEREAS, pursuant to the Letter Agreement dated as of August 29, 2008, Vision agrees to exercise 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 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 increase the number of shares exerciseable under the Series J Warrant to 3,745,320 shares of the Issuer’s
Series A Convertible Preferred Stock and to decrease the Warrant Price to $2.67 as an inducement for such exercise; 
 NOW, THEREFORE, in
compliance with Section 8 of the Series J Warrant and in consideration of the mutual promises and covenants set forth herein and in the Series J Warrant, the Company and Vision hereby agree as follows: 
  

	 	1.	Vision represents that it has not transferred or assigned the Series J Warrant or any part thereof to any third party. 

  

	 	2.	The text on the front page of the Series J Warrant which reads “Number of Shares: 2,309,468” is hereby deleted in its entirety and replaced with the text: “Number of
Shares: 3,745,320.” 

	 	3.	The first paragraph of the Series J Warrant is hereby amended to read in its entirety: 

 “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.
or its registered assigns is entitled to subscribe for and purchase, during the Term (as hereinafter defined), up to three million seven hundred forty-five thousand three hundred twenty (3,745,320) shares of the duly authorized, validly issued,
fully paid and non-assessable Series A Convertible Preferred Stock of the Issuer, at an exercise price per share equal to the Warrant Price then in effect, subject, however, to the provisions and upon the terms and conditions hereinafter set
forth. Capitalized terms used in this Warrant and not otherwise defined herein shall have the respective meanings specified in Section 6 hereof.” 
  

	 	4.	Section 1 of the Series J Warrant is hereby amended to read in its entirety: 

 “Term. The term of this Warrant shall commence on December 27, 2007 and with respect to 1,872,660 shares of Series A Convertible Preferred Stock of the Issuer shall expire at 11:59 p.m., eastern time, on
September 8, 2008 and with respect to the remaining 1,872,660 shares of Series A Convertible Preferred Stock of the Issuer shall expire at 11:59 p.m., eastern time, on November 1, 2008 (such respective period being the
“Term”).” 
  

	 	5.	The definition of “Warrant Price” in Section 6 of the Series J Warrant is hereby amended to read in its entirety: 

 “means $2.67.” 
  

	 	6.	The term “Effective Date” herein shall be as defined in the Letter Agreement. 

  

	 	7.	The Issuer and Vision hereby acknowledge and consent to the foregoing amendments to the Series J Warrant as set forth herein. 

  

	 	8.	The Issuer and Vision hereby waive Section 8 of the Series J Warrant with respect to this Series J Warrant Amendment and the transactions contemplated therein. The Issuer and
Vision further waive any necessity of offering same consideration to all holders of the Warrants pursuant to Section 8 of the Series J Warrant. 

  

	 	9.	Except as amended herein, all other terms and provisions of the Series J Warrant shall remain in full force and effect. 

  

	 	10.	This Series J Warrant Amendment shall be effective upon its execution by the Company and Vision. 

	 	11.	This Series J Warrant Amendment may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other parties hereto, it being understood that all parties need not sign the same counterpart. In the event that
any signature is delivered by facsimile or electronic transmission, such signature shall create a valid binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force and effect as if such
facsimile or electronic signature were the original thereof. 

 IN WITNESS WHEREOF, the parties have caused this Series J
Warrant Amendment to be duly executed and delivered by the proper and duly authorized officers as of the day and year first written above. 
  

					
		 	COMPANY:
		
		 	NOVARAY MEDICAL, INC.
			
		 	By:	 	 /s/    Jack Price

		 	Name:	 	Jack Price
		 	Title:	 	Chief Executive Officer
		
		 	VISION:
		
		 	VISION OPPORTUNITY MASTER FUND, LTD.
			
		 	By:	 	 /s/    Adam Benowitz

		 	Name:	 	Adam Benowitz
		 	Title:	 	DirectorAmendment To Series J-A Warrant

 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: 
  

	 	1.	Vision represents that it has not transferred or assigned the Series J-A Warrant or any part thereof to any third party. 

	 	2.	The first paragraph of the Series J-A Warrant is hereby amended to read in its entirety: 

 “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 conditions hereinafter set forth. Subject to both the exercise by Vision of the Series J Warrant 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, Vision or its registered assigns shall be entitled to subscribe for and purchase, during the Term up to an additional nine
hundred thirty-six thousand three hundred thirty (936,330) shares of the duly authorized, validly issued, fully paid and non-assessable Common Stock of the Issuer (but subject to adjustment as hereinafter provided) (the “September 2008
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 conditions hereinafter set forth. Subject to both the exercise by Vision of the Series J
Warrant of the difference between such initial exercise and 3,745,320 shares of the Issuer’s Series A Convertible Preferred Stock and receipt by Issuer of proceeds of at least $10,000,004.40 (inclusive of all amounts received after
August 29, 2008) on or prior to November 1, 2008, Vision or its registered assigns shall be entitled to subscribe for and purchase, during the Term up to an additional nine hundred thirty-six thousand three hundred thirty
(936,330) shares of the duly authorized, validly issued, fully paid and non-assessable Common Stock of the Issuer (but subject to adjustment as hereinafter provided) (the “November 2008 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 conditions hereinafter set forth. Capitalized terms used in this Warrant and not otherwise defined herein shall have the respective meanings
specified in Section 8 hereof.” 

	 	3.	Section 1 of the Series J-A Warrant is hereby amended to read in its entirety: 

 “Term. The term of this Warrant shall commence on the date of exercise of the Series J Warrant (as defined in the Purchase Agreement) by the Holder (the “Series J Exercise Date”) and , with
respect to the Initial Exercise Shares, shall expire at 6:00 p.m., Eastern Time, on the fifth anniversary of the Series J Exercise Date and with respect to the September 2008 Exercise Shares shall expire at 6:00 p.m., Eastern Time, on
September 8, 2013 and with respect to the November 2008 Exercise Shares shall expire at 6:00 p.m., Eastern Time, on November 1, 2013 (such respective period being the “Term”); provided, however, that in the event that the
Series J Warrant is not exercised on or prior to September 8, 2008 in accordance with its terms, this Warrant and all obligations hereunder shall terminate immediately and be of no further force or effect.” 
  

	 	4.	The definition of “Warrant Price” in Section 8 of the Series J-A Warrant is hereby amended to read in its entirety: 

 “initially means $4.25 with respect to the Initial Exercise Shares and $5.00 with respect to the September 2008 Exercise Shares and November 2008
Exercise Shares, as such prices may be adjusted from time to time as shall result from the adjustments specified in this Warrant, including Section 4 hereto” 
  

	 	5.	The term “Effective Date” herein shall be as defined in the Letter Agreement. 

  

	 	6.	The Issuer and Vision hereby acknowledge and consent to the foregoing amendments to the Series J-A Warrant as set forth herein. 

  

	 	7.	The Issuer and Vision hereby waive Section 10 of the Series J-A Warrant with respect to this Series J-A Warrant Amendment and the transactions contemplated herein. The Issuer
and Vision further waive any necessity of offering same consideration to all holders of the Warrants pursuant to Section 10 of the Series J-A Warrant. 

  

	 	8.	Except as amended herein, all other terms and provisions of the Series J-A Warrant shall remain in full force and effect. 

  

	 	9.	This Series J-A Warrant Amendment shall be effective upon its execution by the Company and Vision. 

  

	 	10.	This Series J-A Warrant Amendment may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other parties hereto, it being understood that all parties need not sign the same counterpart. In the event
that any signature is delivered by facsimile or electronic transmission, such signature shall create a valid binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force and effect as if such
facsimile or electronic signature were the original thereof. 

 IN WITNESS WHEREOF, the parties have caused this Series J-A Warrant Amendment to be duly executed and delivered by the
proper and duly authorized officers as of the day and year first written above. 
 COMPANY: 
 NOVARAY MEDICAL, INC. 
  

					
		 	By:	 	 /s/    Jack Price

		 	Name:	 	Jack Price
		 	Title:	 	Chief Executive Officer

 VISION: 
 VISION OPPORTUNITY MASTER FUND, LTD. 
  

					
		 	By:	 	 /s/    Adam Benowitz

		 	Name:	 	Adam Benowitz
		 	Title:	 	Director

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