Schedule 13D Amendment No. 2

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Du8YaJd9Hh84O6bVsCFYGFsMEOMaqJVtEbdzdi/TMN86awHDgEJQqht7b/d0DyT8 SguhHklmoY2jPRxe8fnkIQ== 0001193125-07-149006.txt : 20070703 0001193125-07-149006.hdr.sgml : 20070703 20070703123033 ACCESSION NUMBER: 0001193125-07-149006 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20070703 DATE AS OF CHANGE: 20070703 GROUP MEMBERS: EHC GP, LP GROUP MEMBERS: EHC, INC. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SPECTRX INC CENTRAL INDEX KEY: 0000924515 STANDARD INDUSTRIAL CLASSIFICATION: ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845] IRS NUMBER: 582029543 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-51261 FILM NUMBER: 07958912 BUSINESS ADDRESS: STREET 1: 4955 AVALON RIDGE PKWY STREET 2: SUITE 300 CITY: NORCROSS STATE: GA ZIP: 30071 BUSINESS PHONE: 7702428723 MAIL ADDRESS: STREET 1: 4955 AVALON RIDGE PKWY STREET 2: SUITE 300 CITY: NORCROSS STATE: GA ZIP: 30071 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: EASTON HUNT CAPITAL PARTNERS LP CENTRAL INDEX KEY: 0001118674 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 641 LEXINGTON AVE STREET 2: 21ST FL CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D/A 1 dsc13da.htm SCHEDULE 13D AMENDMENT NO. 2 Schedule 13D Amendment No. 2

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-102)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a)

AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)

(Amendment No. 2)*

SpectRx, Inc.

(Name of Issuer)

Common Stock

(Title of Class of Securities)

847635109

(CUSIP Number)

Richard P. Schneider

c/o Easton Hunt Capital Partners, L.P.

767 Third Avenue, 7th Floor

New York, NY 10017

(212) 702-0950

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

March 12, 2007

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f), or 13d-1(g), check the following box ¨

*	The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act.


CUSIP No. 847635109				Page 2 of 10 Pages


1	NAME OF REPORTING PERSON: S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY):

	Easton Hunt Capital Partners, L.P.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
	(a) ¨
	(b) ¨
3	SEC USE ONLY


4	SOURCE OF FUNDS

	WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e)	¨

6	CITIZENSHIP OR PLACE OF ORGANIZATION

	Delaware


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER

		2,439,734 (1)
		8 SHARED VOTING POWER

		0
		9 SOLE DISPOSITIVE POWER

		2,439,734 (1)
		10 SHARED DISPOSITIVE POWER

		0


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,439,734 (1)
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	¨

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	17.0%*
14	TYPE OF REPORTING PERSON

	PN

*	Based upon the 11,948,631 shares of common stock (“Common Stock”) outstanding as of April 9, 2007, according to the Issuer’s 10-KSB as filed with the Securities and Exchange Commission on April 30, 2007.

(1)

Consists of 83,333 shares of Series A Convertible Preferred Stock (“Series A Preferred Stock”) presently convertible into 1,923,069 shares of Common Stock and warrants to purchase 516,665 shares of Common Stock. This amount does not include shares of common stock which may be acquired upon conversion of accrued but unpaid dividends on the Series A Preferred Stock. Each share of Series A Preferred Stock is convertible into the number of shares of Common Stock equal to the quotient obtained by dividing the sum of (i) $15.00 (as adjusted from time to time for changes in the Series A Preferred Stock by stock split, stock dividend or other similar circumstances), plus (ii) all accrued but unpaid dividends on such share of Series A Preferred Stock, by the conversion price per share of $0.65 (as may be adjusted from time to time to take into account certain anti-dilutive events).


CUSIP No. 847635109				Page 3 of 10 Pages


1	NAME OF REPORTING PERSON: S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY):

	EHC GP, LP
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
	(a) ¨
	(b) ¨
3	SEC USE ONLY

4	SOURCE OF FUNDS

	WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e)	¨


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	Delaware


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER

		2,439,734 (1)
		8 SHARED VOTING POWER

		0
		9 SOLE DISPOSITIVE POWER

		2,439,734 (1)
		10 SHARED DISPOSITIVE POWER

		0


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,439,734 (1)
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	¨


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	17.0%*
14	TYPE OF REPORTING PERSON

	PN

*	Based upon the 11,948,631 shares of common stock (“Common Stock”) outstanding as of April 9, 2007, according to the Issuer’s 10-KSB as filed with the Securities and Exchange Commission on April 30, 2007.

(1)


CUSIP No. 847635109				Page 4 of 10 Pages


1	NAME OF REPORTING PERSON: S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY):

	EHC, Inc.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
	(a) ¨
	(b) ¨
3	SEC USE ONLY

4	SOURCE OF FUNDS

	WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e)	¨


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	Delaware


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER

		2,439,734 (1)
		8 SHARED VOTING POWER

		0
		9 SOLE DISPOSITIVE POWER

		2,439,734 (1)
		10 SHARED DISPOSITIVE POWER

		0


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,439,734 (1)
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	¨

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	17.0%*
14	TYPE OF REPORTING PERSON

	CO

*	Based upon the 11,948,631 shares of common stock (“Common Stock”) outstanding as of April 9, 2007, according to the Issuer’s 10-KSB as filed with the Securities and Exchange Commission on April 30, 2007.

(1)

This Amendment No. 2 to Schedule 13D amends and restates in it entirety Amendment No. 1 to the Schedule 13D/A as filed with the Securities and Exchange Commission on June 20, 2007.

Item 1. Security and Issuer.

The name of the issuer is SpectRx, Inc., a Delaware corporation (the “Issuer”). The address of the Issuer’s office is 4955 Avalon Ridge Parkway, Suite 300, Norcross, Georgia 30071. This Schedule 13D/A relates to the Issuer’s Common Stock.

Item 2. Identity and Background.

(a -c) This statement is being filed by (i) Easton Hunt Capital Partners, L.P., a Delaware limited partnership (the “Fund”), (ii) EHC GP, LP, a Delaware limited partnership (“EHC GP”) and (iii) EHC, Inc., a Delaware corporation (“EHC Inc.” and together with EHC GP, collectively, the “Reporting Persons”). The persons serving as the directors and executive officers of EHC Inc. are set forth in Schedule A hereto.

The Shares are directly owned by the Fund. EHC GP is the general partner of the Fund. EHC Inc. is the general partner of EHC GP. The address for the Fund and each of the Reporting Persons is 767 Third Avenue, 7^th Floor, New York, NY 10017. The Fund is a venture capital and private equity investment fund licensed by the U.S. Small Business Administration as a small business investment company.

(d) During the last five years, neither the Fund, the Reporting Persons or the persons listed on Schedule A hereto has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e) During the last five years, neither the Fund, the Reporting Persons or the persons listed on Schedule A hereto has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which such person was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, Federal or State securities laws or finding any violations with respect to such laws.

Item 3. Source and Amount of Funds or Other Consideration.

The Fund paid no additional consideration in connection with the beneficial acquisition of the Additional Shares (as defined below). See Item 5(c) for a further description thereof.

Item 4. Purpose of Transaction.

The Fund and the Reporting Persons previously filed a Schedule 13D on July 26, 2006 relating to the Common Stock of the Issuer. The filing of this Amendment No. 2 reflects additional Common Stock into which the Series A Preferred Stock can be converted as a result of certain anti-dilution provisions that were triggered by the Amended and Restated Loan

Agreement which is described in the Issuer’s Form 8-K filed on March 12, 2007 (the “Amended Loan Agreement”) and an additional Common Stock Purchase Warrant that was issued to the Fund in connection with the Issuer’s financing transaction in March 2007.

The Fund continues to be active in discussions concerning the restructuring of the Issuer’s business strategy, certain management changes and modification of the size and composition of the Board of Directors. The Fund may enlist other shareholders to facilitate these changes.

Item 5. Interest in Securities of the Issuer.

(a) and (b). See the rows numbered 7, 8, 9, 10, 11 and 13 and footnote (1) thereto on each of pages 2 through 4 above, which are incorporated herein by reference.

(c) The Amended Loan Agreement reduced the conversion price of the Series A Preferred Stock to $0.65 per share and reduced the warrant price of a Common Stock Warrant to purchase 416,665 shares of Common Stock issued to the Fund to $0.81 per share. In addition, the Fund was issued a separate Common Stock Warrant to purchase 100,000 shares of Common Stock at an exercise price of $0.78 per share. As a result of the reduction of the Series A Preferred Stock conversion price and the issuance of a Common Stock Warrant to purchase 100,000 shares of Common Stock, the Fund and the Reporting Persons acquired beneficial ownership of 1,189,739 additional shares of Common Stock (the “Additional Shares”). Other than the acquisition of the Additional Shares, neither the Fund, the Reporting Persons or the persons set forth on Schedule A has effected any transactions in the Common Stock during the last 60 days.

(d) No person is known by the Fund or any Reporting Persons to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, any of the Shares that may be deemed to be beneficially owned by the Fund or the Reporting Persons, other than EHC Inc.

(e) Not applicable.

Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.

The Fund is a party to that certain Securities Purchase Agreement dated March 26, 2004 among the Issuer and the Purchasers named therein (the “Securities Purchase Agreement”). Pursuant to the terms of the Securities Purchase Agreement, the Fund purchased from the Issuer certain shares of Series A Preferred Stock and warrants to purchase shares of Common Stock subject to the terms therein. The full text of the Securities Purchase Agreement as filed with the Securities and Exchange Commission (“SEC”) is hereby incorporated herein by reference.

The Fund is a party to that certain Registration Rights Agreement, dated March 26, 2004 between the Issuer and the parties named therein (the “Registration Rights Agreement”). Pursuant to the terms of the Registration Rights Agreement, the Issuer is required

to use its best efforts to keep a shelf registration statement effective relating to certain shares of Common Stock issuable upon conversion of or other events associated with the Series A Preferred Stock until the earlier of (i) the date on which all of the shares of Common Stock to which the Registration Rights Agreement relate have been disposed of in accordance with the registration statement, (ii) the date on which all of the Common Stock to which the Registration Rights Agreement relate which are held by non-affiliates of the Issuer are eligible to be sold pursuant to Rule 144(k) of the Securities Act of 1933; and (iii) the seventh anniversary of the date of the Registration Rights Agreement. The full text of the Registration Rights Agreement as filed with the SEC is hereby incorporated herein by reference.

The Certificate of Designations for Series A Preferred Stock of the Issuer sets forth certain rights and privileges in connection with its Series A Preferred Stock, including but not limited to, dividends, voting, conversion and anti-dilution rights. The full text of the Certificate of Designations for Series A Preferred Stock as filed with the SEC is hereby incorporated herein by reference.

The Fund is a party to that certain Common Stock Purchase Warrant (the “Initial Warrant”) which entitles the Fund to purchase 416,665 shares of Common Stock of the Issuer for a purchase price of $0.81 per share (subject to adjustment) on or prior to March 26, 2009. The full text of the form of Initial Warrant as filed with the SEC is hereby incorporated herein by reference.

The Fund is a party to that certain Common Stock Purchase Warrant (the “March 2007 Warrant”) which entitles the Fund to purchase 100,000 shares of Common Stock of the Issuer for a purchase price of $0.78 per share (subject to adjustment) on or prior to February 23, 2012. The full text of the form of March 2007 Warrant as filed with the SEC is hereby incorporated herein by reference.

Item 7. Material to be Filed as Exhibits.


Exhibit Number:		Exhibit Description:
99.1		Joint filing agreement pursuant to which the Fund and the Reporting Persons have authorized the filing of this Amendment as a group (previously filed as Exhibit 99.1 to the Schedule 13D of the Fund and the Reporting Persons as filed on July 26, 2006).

99.2		Securities Purchase Agreement dated March 26, 2004 among SpectRx, Inc. and the purchasers listed therein (incorporated by reference to Exhibit 99.2 to the Issuer’s 8-K filed on March 29, 2004).

99.3		Registration Rights Agreement, dated March 26, 2004 between the Issuer and the parties named therein (incorporated by reference to Exhibit 99.3 to the Issuer’s 8-K filed on March 29, 2004).

99.4		Certificate of Designations for Series A Preferred Stock (incorporated by reference to Exhibit 99.4 to the Issuer’s 8-K filed on March 29, 2004).


99.5		Form of Common Stock Purchase Warrant between the Issuer and the Fund for the purchase of 416,665 shares of Common Stock (incorporated by reference to Exhibit 99.6 to the Issuer’s 8-K filed on March 29, 2004).

99.6		Form of Common Stock Purchase Warrant between the Issuer and the Fund for the purchase of 100,000 shares of Common Stock.

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.


Dated: July 2, 2007	EASTON HUNT CAPITAL PARTNERS, L.P.

	By:	EHC GP, LP, its general partner

	By:	EHC, Inc., its general partner

	By:	/s/ Richard P. Schneider
	Name:	Richard P. Schneider
	Title:	Vice President

	EHC GP, LP

	By:	EHC, Inc., its general partner

	By:	/s/ Richard P. Schneider
	Name:	Richard P. Schneider
	Title:	Vice President

	EHC, INC.

	By:	/s/ Richard P. Schneider
	Name:	Richard P. Schneider
	Title:	Vice President

Schedule A

The name and present principal occupation of each executive officer and director of EHC, Inc. is set forth below. The business address of each executive officer and director of EHC, Inc. is c/o Easton Hunt Capital Partners, L.P., 767 Third Avenue, 7^th Floor, New York, NY 10017. All of the persons listed below are United States citizens, except for Frank Garcia who is a permanent resident.


Name	Position with EHC, Inc.	Principal Occupation (if different)
John Friedman	Director and President	N/A

Frank Garcia	Director and Vice President	N/A

Richard Schneider	Director, Vice President and Secretary	N/A

EX-99.6 2 dex996.htm FORM OF COMMON STOCK PURCHASE WARRANT Form of Common Stock Purchase Warrant

Exhibit 99.6

WARRANT

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD OR OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT AS TO THE WARRANT AND THE SHARES OF COMMON STOCK UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF SAID ACT.

SPECTRX, INC.

COMMON STOCK WARRANT

100,000 Shares of Common Stock


No. PW-13		March 1, 2007

SPECTRX, INC., a Delaware corporation (the “Company”), for value received, hereby certifies that Easton Hunt Capital Partners, LP, or its registered assigns (the “Holder”) is entitled, subject to the provisions hereof, to purchase from the Company, at any time or from time to time during the Exercise Period (as defined below), 100,000 duly authorized, validly issued, fully paid and nonassessable shares of Common Stock (defined below) of the Company (the “Warrant Shares”) at a purchase price of $0.78 per share (the “Warrant Price”), all subject to the terms, conditions and adjustments set forth below in this warrant (this warrant, and any new warrant issued pursuant to the terms hereof, being referred to herein as “Warrant”). This Warrant is one of a series of warrants (the “Warrants”) issued pursuant to the Amended and Restated Loan Agreement dated March 1, 2007 entered into by the Company, the “Agent” and the “Noteholders” named therein (the “Loan Agreement”). Capitalized terms not otherwise defined in Section 6 hereof shall have the meaning given to such terms in the Loan Agreement.

1. Exercise of Warrant.

1.1. Manner of Exercise. This Warrant may be exercised by the Holder, in whole or in part, during normal business hours on any Business Day by delivering at the principal executive office of the Company the Warrant and a subscription notice in the form of Schedule I duly executed by such Holder accompanied by payment in cash or by certified or official bank check payable to the order of the Company or by wire transfer in the amount obtained by multiplying (a) the number of Warrant Shares designated in such subscription by (b) the Warrant Price.

1.2. When Exercise Effective. Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the Business Day on which this Warrant shall have been surrendered to the Company as provided in Section 1.1. At such time, the Person or Persons in whose name or names any certificate or certificates for Warrant Shares shall be issuable upon such exercise as provided in Section 1.3 shall be deemed to have become the stockholder(s) of record thereof.

1.3. Delivery of Stock Certificates, etc. As soon as practicable after the exercise of this Warrant, in whole or in part, and in any event within five (5) Business Days thereafter, the

Company at its expense will cause to be issued to and delivered or registered in the name of the Holder hereof or, subject to Section 3, as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, the number of duly authorized, validly issued, fully paid and nonassessable Warrant Shares to which such Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Holder would otherwise be entitled, cash in an amount equal to the same fraction of the Market Price per share on the Business Day next preceding the date of such exercise. If the Company’s transfer agent is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer program, and so long as certificates issued pursuant the exercise hereof do not bear a legend and the Holder is not obligated to return such certificate for the placement of a legend thereon, the Company shall cause its transfer agent to electronically transmit the Warrant Shares so purchased to the Holder by crediting the account of the Holder with DTC through its Deposit Withdrawal Agent Commission system (“DTC Transfer”). If the aforementioned conditions to a DTC Transfer are not satisfied, the Company shall deliver to the Holder physical certificates representing the Warrant Shares so purchased. Further, the Holder may instruct the Company to deliver to the Holder physical certificates representing the Warrant Shares so purchased in lieu of delivering such shares by way of DTC Transfer. Any certificates so delivered shall be in such denominations as may be reasonably requested by the Holder hereof, shall be registered in the name of such Holder and shall bear a restrictive legend. If this Warrant shall have been exercised only in part, then the Company shall, at its expense, at the time of delivery of such certificates, deliver to the Holder a new Warrant or Warrants of like tenor, calling in the aggregate on the face or faces thereof for issuance of the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such shares called for on the face of this Warrant minus the number of such shares so designated by such Holder upon such exercise as provided in Section 1.1.

1.4. Representations of the Company. The Company represents, warrants and acknowledges to the Holder that:

(a) it is a corporation duly formed and validly existing in the State of Delaware;

(b) it will at all times reserve and keep available, solely for issuance and delivery upon the exercise of this Warrant, the number of Warrant Shares (or Other Securities) from time to time issuable upon the exercise of the Warrant at the time outstanding. All such securities shall be duly authorized and, when issued upon such exercise, shall be validly issued and, in the case of shares, fully paid and nonassessable with no liability on the part of the holders thereof.

(c) this Warrant has been duly authorized and approved by all requisite action of the Company, and constitutes a valid and binding agreement of the Company; and

(d) when issued in accordance with the terms of this Warrant, the Warrant Shares will be duly authorized and validly issued, fully paid and nonassessable.

2. Warrant Adjustments.

2.1. Reclassification, Exchange, and Substitution. If the Warrant Shares shall be changed into the same or a different number of shares of the same or any other class or classes of stock or other securities of the Company, including any such reclassification in connection with a consolidation or merger in which the Company is the surviving entity, whether by capital reorganization, reclassification, or otherwise (other than a subdivision or combination of shares provided for above), the Holder shall, on its exercise, be entitled to receive the kind and number of shares of Common Stock or Other Securities which the Holder would have owned or been entitled to receive had such Warrant been exercised in full immediately prior to the happening of such reclassification, exchange or substitution for the same aggregate consideration. If the Company shall at any time change its Common Stock or Other Securities, as the case may be, into the same or a different number of shares of the same or any other class or classes of stock or Other Securities, as the case may be, the Warrant Price then in effect immediately before that reclassification, exchange or substitution shall be adjusted by multiplying the Warrant Price by a fraction, the numerator of which shall be the number of shares of Common Stock or Other Securities, as the case may be, purchasable upon the exercise of this Warrant immediately prior to such adjustment and the denominator of which shall be the number of shares of Common Stock or Other Securities, as the case may be, purchasable immediately thereafter. An adjustment made pursuant to this Section 2.1 shall become effective immediately after the effective date of such event. Such adjustment shall be made successively whenever such an event occurs.

2.2. Reorganization. Mergers or Consolidations. In the event of a reorganization, merger or consolidation of the Company with or into another entity, then, as part of such reorganization, merger or consolidation, lawful provision shall be made so that the Holder shall thereafter be entitled to receive upon exercise of this Warrant, at any time prior to the end of the Exercise Period and upon payment of the Warrant Price then in effect, the number of shares of Common Stock or Other Securities or property of the Company, or of the successor corporation resulting from such merger or consolidation, to which the Holder would have been entitled in such reorganization, merger, or consolidation if this Warrant bad been exercised immediately before that reorganization, merger or consolidation. In any such case, appropriate adjustment (as determined in good faith by the Company’s Board of Directors) shall be made in the application of the provisions of this Warrant with respect to the rights and interests of the Holder after the reorganization, merger or consolidation to the end that the provisions of this Warrant (including adjustment of the Warrant Price then in effect and number of shares of Common Stock purchasable upon exercise of this Warrant) shall be applicable after that event, as near as reasonably may be, in relation to any Common Stock or Warrants or other property deliverable after than event upon exercise of this Warrant. The Company shall, within thirty (30) days after making such adjustment, give written notice (by first class mail, postage prepaid) to the Holder at the address of the Holder shown on the Company’s books. That notice shall set forth, in reasonable detail, the event requiring the adjustment and the method by which the adjustment was calculated and specify the Warrant Price then in effect after the adjustment and the increased or decreased number of Warrant Shares purchasable upon exercise of this Warrant. When appropriate, that notice may be given in advance and include as part of the notice required under other provisions of this Warrant. Notwithstanding the foregoing, in the event of any transaction described in this Section 2.2 in which the consideration to be received by holders of Common Stock is payable only in cash, the Holder shall be entitled only to cash in the amount, if any, that such cash payment per share exceeds the Warrant Price.

2.3. Form of Warrant after Adjustments. The form of this Warrant need not be changed because of any adjustments in the Warrant Price or number or kind of the shares of Common Stock purchasable pursuant to this Warrant, and Warrants theretofore or hereunder issued may continue to express the same price and number and kind of shares as are stated in this Warrant, as initially issued; provided, however, that the Company may, at any time in its sole discretion (which shall be conclusive), make any change in the form of Warrant certificate that it may deem appropriate and that does not affect the substance thereof. Any Warrant certificate thereafter issued, whether upon registration of transfer of, or in exchange or substitution for, an outstanding Warrant certificate may be in the form so changed.

3. Restrictions on Transfer.

3.1. Restrictive Legends. Except as otherwise permitted by this Section 3, each Warrant originally issued, each Warrant issued upon direct or indirect transfer, each certificate for Common Stock (or Other Securities) issued upon the exercise of any Warrant, and each certificate issued upon the direct or indirect transfer of any such Common Stock (or Other Securities), shall be stamped or otherwise imprinted with a legend in substantially the following form, if applicable:

“THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR EXEMPTION THEREFROM AND ANY APPLICABLE STATE SECURITIES LAWS OR EXEMPTION THEREFROM.”

3.2. Notice of Proposed Transfer; Opinions of Counsel. Prior to any transfer of any Restricted Securities which are not registered under an effective registration statement under the Securities Act (other than a transfer pursuant to Rule 144, Rule 144A or any comparable rule under such Act), the Holder thereof will give written notice to the Company of such Holder’s intention to effect such transfer and to comply in all other respects with this Section 3.2. Each such notice shall (a) describe the manner and circumstances of the proposed transfer in sufficient detail to enable counsel to render the opinion referred to below, and (b) designate counsel for the Holder giving such notice, which counsel shall be reasonably satisfactory to the Company. The holder giving such notice will submit a copy thereof to the counsel designated in such notice. The following provisions shall then apply:

3.2.1. if in the written opinion of such counsel for the Holder, obtained at the Holder’s sole cost and expense and a copy of which shall be delivered to the Company and shall be reasonably satisfactory in form, scope and substance to the Company, the proposed transfer may be effected without registration of such Restricted Securities under the Securities Act or applicable state securities laws, such Holder shall thereupon be entitled to transfer such

Restricted Securities in accordance with the terms of the notice delivered by such Holder to the Company. Each Restricted Security or certificate, if any, issued upon or in connection with such transfer shall bear the appropriate restrictive legend set forth in Section 3.1 unless, in the opinion of such counsel, such legend is no longer required to insure compliance with the Securities Act and applicable state securities laws; and

3.2.2. if the opinion of such counsel rendered pursuant to the foregoing subdivision 3.2.1 is not to the effect that the proposed transfer may legally be effected without registration of such Restricted Securities under the Securities Act or applicable state securities laws (such opinion to state the basis of the legal conclusions reached therein), such Holder shall not be entitled to transfer such Restricted Securities (other than a transfer pursuant to Rule 144, Rule 144A or any comparable rule under the Securities Act) until receipt by the Company of a further notice and a further opinion of counsel for such Holder to the effect stated in subdivision 3.2.1 above or until registration of such Restricted Securities under the Securities Act and applicable state securities laws has become effective.

3.2.3. Termination of Restrictions. The restrictions imposed by this Section 3 upon the transferability of Restricted Securities shall cease and terminate as to any particular Restricted Securities upon sale of the Restricted Securities in an offering registered under the Securities Act or when, in the opinion of counsel for the Company, such restrictions are no longer required in order to ensure compliance with the Securities Act. Whenever such restrictions shall terminate as to any Restricted Securities, the Holder thereof shall be entitled to receive from the Company, without expense (other than transfer taxes, if any), new securities of like tenor not bearing the applicable legend set forth in Section 3.1.

4. Ownership. Transfer and Substitution of Warrants. The Company may treat the Person in whose name this Warrant is registered on the register kept at the principal executive office of the Company as the owner and Holder thereof for all purposes, notwithstanding any notice to the contrary, except that, if and when any Warrant is properly assigned in blank, the Company may (but shall not be obligated to) treat the bearer thereof as the owner of such Warrant for all purposes, notwithstanding any notice to the contrary. Subject to Section 3, a Warrant, if properly assigned, may be exercised by a new Holder without first having a new Warrant issued.

5. Registration Rights. The holder of this Warrant shall be entitled to the registration rights set forth in the Loan Agreement.

6. Definitions. As used herein, unless the context otherwise requires, the following terms have the following respective meanings:

“Business Day” shall mean any day other than a Saturday, Sunday or any other day on which U.S. Federal Reserve member banks are not open for business in Atlanta, Georgia.

“Commission” shall mean the Securities and Exchange Commission or any other Federal agency at the time administering the Securities Act.

“Common Stock” shall mean, the common stock, par value $.00l per share (or other common equity interest, however denominated) of the Company and any stock into which such Common Stock shall have been changed or any stock resulting from any reclassification of such Common Stock.

“Company” shall have the meaning specified in the opening paragraph of this Warrant.

“Exercise Period” means the date commencing on February 23, 2007 and ending on February 23, 2012.

“Holder” shall have the meaning specified in the opening paragraph of this Warrant.

“Loan Agreement” shall have the meaning specified in the opening paragraph of this Warrant.

“Market Price” shall mean, per share of Common Stock on any date specified herein, (a) the last sale price on such date of such Common Stock or, if no such sale takes place on such date, the average of the closing bid and asked prices thereof on such date, in each case as officially reported on the principal national securities exchange on which such Common Stock is then listed or admitted to trading, or (b) if such Common Stock is not then designated, as a national market system security by the average National Association of Securities Dealers, Inc., but is trading on either the over-the-counter market on the OTC Bulletin Board or the “Pink Sheets”, the last sale price as reported by the National Quotation Bureau, or (c) if neither (a) nor (b) is applicable, a price per share thereof equal to the fair value thereof determined in good faith by a resolution of the Board of Directors of the Company as of a date which is within 15 days of the date as of which the determination is to be made.

“Other Securities” shall mean any stock (other than Common Stock) and other securities of the Company or any other Person (corporate or otherwise) which the Holder of the Warrant at any time shall be entitled to receive, or shall have received, upon the exercise of the Warrant, in lieu of or in addition to Common Stock, or which at any time shall be issuable or shall have been issued in exchange for or in replacement of Common Stock or Other Securities pursuant to Section 2 or otherwise.

“Person” shall mean a corporation, an association, a partnership, an organization or business, an individual, a government or political subdivision thereof or a governmental agency.

“Restricted Securities” shall mean (a) any Warrants bearing the applicable legend set forth in Section 3.1, (b) any Warrant Shares (or Other Securities) issued upon the exercise of Warrants which are evidenced by a certificate or certificates bearing the applicable legend set forth in such Section and (c) any Warrant Shares (or Other Securities) issued subsequent to the exercise of any of the Warrants as a dividend or other distribution with respect to, or resulting from a subdivision of the outstanding shares of Common Stock (or Other Securities) into a greater number of shares by reclassification, stock splits or otherwise, or in exchange for or in replacement of the Common Stock (or Other Securities) issued upon such exercise, which are evidenced by a certificate or certificates bearing the applicable legend set forth in such section.

“Securities Act” shall mean the Securities Act of 1933, or any similar Federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.

“Warrant Price” shall have the meaning specified in the opening paragraph of this Warrant.

“Warrant Shares” shall have the meaning specified in the opening paragraph of this Warrant.

“Warrants” shall have the meaning specified in the opening paragraph of this Warrant.

7. No Rights or Liabilities as Stockholder. Nothing contained in this Warrant shall be construed as conferring upon Holder hereof any rights as a stockholder of the Company or as imposing any obligation on such Holder to purchase any securities or as imposing any liabilities on the Holder as a stockholder of the Company, whether such obligation or liabilities are asserted by the Company or by creditors of the Company.

8. Notice. All notices and other communications provided for herein shall be delivered or mailed by first class mail, postage prepaid, addressed to:

If to the Holder:

767 Third Avenue, 17th Floor

New York, NY 10017

Attention: Francisco Garcia

If to the Company:

4955 Avalon Ridge Parkway, Suite 300

Norcross, GA 30071

The address provided in this Section 8 may be modified by the Company by providing the Holder notice in writing; provided, however, that the exercise of any Warrant shall be effective in the manner provided in Section 1.

9. Miscellaneous. This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought; however, the Warrants may be amended as provided in the Loan Agreement. Any provision of this Warrant which shall be prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, the Company waives any provision of law which shall render any provision hereof prohibited or unenforceable in any respect. This Warrant shall be governed by the substantive

laws of the State of Georgia without reference to the choice of law rules thereof. The headings of this Warrant are inserted for convenience only and shall not be deemed to constitute a part hereof.

10. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it, and upon reimbursement to the Company of all reasonable expenses incidental thereto, and upon surrender and cancellation of this Warrant, if mutilated, the Company will make and deliver a new Warrant of like tenor and dated as of such cancellation, in lieu of this Warrant.

11. Saturdays, Sundays. Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein is not a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.

12. Expiration. The right to exercise this Warrant shall expire on the last day of the Exercise Period.


SpectRx, Inc.

By:
Name:		Mark A. Samuels
Title:		Chairman & CEO

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