**AMENDMENT
        NO. 1**
 **TO**
 **ORION
        HEALTHCORP, INC. 2004 INCENTIVE PLAN**
 
 
 THIS
        AMENDMENT is made as of the 1 st day of
        June, 2005, by ORION HEALTHCORP, INC. (the “Company”);
 
 W
        I T
        N E S S E T H :
  WHEREAS,
        the Company maintains the Orion HealthCorp, Inc. 2004 Plan (the “Plan”);
        and
  WHEREAS,
        the Company now desires to amend the Plan to allow the grant of restricted
        stock
        units.
  NOW,
        THEREFORE, the Plan is hereby amended as follows:
  1.
  Exhibit A
        to the Plan is hereby amended by adding the following new definition between
        the
        definitions of the terms “Restricted Shares” and “Section 162(m)”:
  "'Restricted
        Stock Units' or 'RSUs' means a right granted under Section 6A of the Plan
        to
        receive a number of shares of Stock or a cash payment for each such share
        of
        Stock equal to the fair market value of a share of Stock on a specified
        date."
  2.
  The
        definition of the term “Award” in Exhibit A of the Plan is amended by inserting
“(ix) Restricted Stock Units,” after “Subsection (viii).”
  3.
  Section
        6(c) of the Plan is hereby amended by adding the term “or Restricted Stock
        Units” after the term “Restricted Stock.”
  4.
  Section
        7(a) of the Plan is hereby amended by inserting “or Restricted Stock Units”
after the term “Restricted Stock.”
  5.
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            1
 The
        first
        sentence of Section 5 of the Plan is hereby amended by inserting “and Restricted
        Stock Units” after the term “Restricted Shares.”
  6.
  Section
        6A the Plan is hereby added:
  Restricted
        Stock Units (or RSUs) .
        Awards
        of Restricted Stock Units may be made to Participants in accordance with
        the
        following terms and conditions:
  (i)  The
        Committee, in its discretion, shall determine and set forth in a written
        agreement the number of RSUs to grant to a Participant, the vesting period,
        and
        other terms and conditions of the award, including whether the Award will
        be
        paid in cash, Stock or a combination of the two and the time when the Award
        will
        be payable ( *i.e.* ,
        at
        vesting, termination of Employment or another date).
  (ii)  Unless
        the agreement granting RSUs provides otherwise, RSUs shall not be sold,
        transferred or otherwise disposed of and shall not be pledged or otherwise
        hypothecated.
  (iii)  A
        Participant to whom RSUs are awarded has no rights as a stockholder with
        respect
        to the Stock represented by the RSUs unless and until the Stock is actually
        delivered to (or issued on behalf of) the Participant; provided, however,
        RSUs
        may have dividend equivalent rights if provided for by the
        Committee.
  (iv)  The
        agreement granting RSUs shall set forth the terms and conditions that shall
        apply upon the termination of the Participant’s Employment with the Company
        (including a forfeiture of RSUs that have not vested upon Participant’s ceasing
        to be employed) as the Committee may, in its discretion, determine at the
        time
        the award is granted.
  (v)  Any
        grant
        of RSUs may specify Performance Criteria that, if achieved, may result in
        vesting or earlier vesting of all or a portion of the RSUs.”
  7.
  This
        Amendment No. 1 to the Plan shall be effective as of June 1, 2005. Except
        as
        hereby modified, the Plan shall remain in full force and effect.
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            2
  IN
        WITNESS WHEREOF, the Company has executed this Amendment No. 1 as of the
        date first written above.
  ORION
                  HEALTHCORP, INC.
                
                
                
                By:
                  ______________________________
 
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