<PAGE>

                                                                    EXHIBIT 10.5

                                  STENTOR, INC.

                 2005 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN

                            ADOPTED: JANUARY 19, 2005
                      APPROVED BY STOCKHOLDERS: _____, 2005

1. GENERAL.

      (a) ELIGIBLE OPTION RECIPIENTS. The persons eligible to receive Options
are the Non-Employee Directors of the Company.

      (b) GENERAL PURPOSE. The Company, by means of the Plan, seeks to retain
the services of its Non-Employee Directors, to secure and retain the services of
new Non-Employee Directors and to provide incentives for such persons to exert
maximum efforts for the success of the Company and any Affiliate by giving them
an opportunity to benefit from increases in value of the Common Stock through
the automatic grant of Nonstatutory Stock Options.

2. DEFINITIONS.

      As used in the Plan, the following definitions shall apply to the
capitalized terms indicated below:

      (a) "ACCOUNTANT" means the independent public accountants of the Company.

      (b) "AFFILIATE" means (i) any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, provided each
corporation in the unbroken chain (other than the Company) owns, at the time of
the determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain, and (ii) any corporation (other than the Company) in an unbroken
chain of corporations beginning with the Company, provided each corporation
(other than the last corporation) in the unbroken chain owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain. The Board shall have the authority to determine (i) the time or
times at which the ownership tests are applied, and (ii) whether "Affiliate"
includes entities other than corporations within the foregoing definition.

      (c) "ANNUAL GRANT" means an Option granted annually to all Non-Employee
Directors who meet the specified criteria pursuant to Section 6(b).

      (d) "ANNUAL MEETING" means the annual meeting of the stockholders of the
Company.

      (e) "BOARD" means the Board of Directors of the Company.

                                       1.
<PAGE>

      (f) "CAPITALIZATION ADJUSTMENT" has the meaning ascribed to that term in
Section 11(a).

      (g) "CHANGE IN CONTROL" means the occurrence, in a single transaction or
in a series of related transactions, of any one or more of the following events:

            (i) any Exchange Act Person becomes the Owner, directly or
indirectly, of securities of the Company representing more than fifty percent
(50%) of the combined voting power of the Company's then outstanding securities
other than by virtue of a merger, consolidation or similar transaction.
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
(a) on account of the acquisition of securities of the Company by an investor,
any affiliate thereof or any other Exchange Act Person from the Company in a
transaction or series of related transactions the primary purpose of which is to
obtain financing for the Company through the issuance of equity securities or
(b) solely because the level of Ownership held by any Exchange Act Person (the
"SUBJECT PERSON") exceeds the designated percentage threshold of the outstanding
voting securities as a result of a repurchase or other acquisition of voting
securities by the Company reducing the number of shares outstanding, provided
that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of voting securities by the Company, and after
such share acquisition, the Subject Person becomes the Owner of any additional
voting securities that, assuming the repurchase or other acquisition had not
occurred, increases the percentage of the then outstanding voting securities
Owned by the Subject Person over the designated percentage threshold, then a
Change in Control shall be deemed to occur;

            (ii) there is consummated a merger, consolidation or similar
transaction involving (directly or indirectly) the Company and, immediately
after the consummation of such merger, consolidation or similar transaction, the
stockholders of the Company immediately prior thereto do not Own, directly or
indirectly, either (a) outstanding voting securities representing more than
fifty percent (50%) of the combined outstanding voting power of the surviving
Entity in such merger, consolidation or similar transaction or (b) more than
fifty percent (50%) of the combined outstanding voting power of the parent of
the surviving Entity in such merger, consolidation or similar transaction, in
each case in substantially the same proportions as their Ownership of the
outstanding voting securities of the Company immediately prior to such
transaction;

            (iii) the stockholders of the Company approve or the Board approves
a plan of complete dissolution or liquidation of the Company, or a complete
dissolution or liquidation of the Company shall otherwise occur;

            (iv) there is consummated a sale, lease, exclusive license or other
disposition of all or substantially all of the consolidated assets of the
Company and its Subsidiaries, other than a sale, lease, license or other
disposition of all or substantially all of the consolidated assets of the
Company and its Subsidiaries to an Entity, more than fifty percent (50%) of the
combined voting power of the voting securities of which are Owned by
stockholders of the Company in substantially the same proportions as their
Ownership of the outstanding voting securities of the Company immediately prior
to such sale, lease, license or other disposition; or

                                       2.
<PAGE>

            (v) individuals who, on the date this Plan is adopted by the Board,
are members of the Board (the "INCUMBENT BOARD") cease for any reason to
constitute at least a majority of the members of the Board; provided, however,
that if the appointment or election (or nomination for election) of any new
Board member was approved or recommended by a majority vote of the members of
the Incumbent Board then still in office, such new member shall, for purposes of
this Plan, be considered as a member of the Incumbent Board.

      The term Change in Control shall not include a sale of assets, merger or
other transaction effected exclusively for the purpose of changing the domicile
of the Company.

      Notwithstanding the foregoing or any other provision of this Plan, the
definition of Change in Control (or any analogous term) in an individual written
agreement between the Company or any Affiliate and the Optionholder shall
supersede the foregoing definition with respect to Options subject to such
agreement; provided, however, that if no definition of Change in Control or any
analogous term is set forth in such an individual written agreement, the
foregoing definition shall apply.

      (h) "CODE" means the Internal Revenue Code of 1986, as amended.

      (i) "COMMON STOCK" means the common stock of the Company.

      (j) "COMPANY" means Stentor, Inc., a Delaware corporation.

      (k) "CONSULTANT" means any person, including an advisor, who is (i)
engaged by the Company or an Affiliate to render consulting or advisory services
and is compensated for such services, or (ii) serving as a member of the Board
of Directors of an Affiliate and is compensated for such services. However,
service solely as a Director, or payment of a fee for such service, shall not
cause a Director to be considered a "Consultant" for purposes of the Plan.

      (l) "CONTINUOUS SERVICE" means that the Optionholder's service with the
Company or an Affiliate, whether as an Employee, Director or Consultant, is not
interrupted or terminated. A change in the capacity in which the Optionholder
renders service to the Company or an Affiliate as an Employee, Consultant or
Director or a change in the entity for which the Optionholder renders such
service, provided that there is no interruption or termination of the
Optionholder's service with the Company or an Affiliate, shall not terminate an
Optionholder's Continuous Service. For example, a change in status from a
Non-Employee Director of the Company to a Consultant of an Affiliate or an
Employee of the Company will not constitute an interruption of Continuous
Service. To the extent permitted by law, the Board or the chief executive
officer of the Company, in that party's sole discretion, may determine whether
Continuous Service shall be considered interrupted in the case of any leave of
absence approved by that party, including sick leave, military leave or any
other personal leave. Notwithstanding the foregoing, a leave of absence shall be
treated as Continuous Service for purposes of vesting in an Option only to such
extent as may be provided in the Company's leave of absence policy or in the
written terms of the Optionholder's leave of absence.

      (m) "CORPORATE TRANSACTION" means the occurrence, in a single transaction
or in a series of related transactions, of any one or more of the following
events:

                                       3.
<PAGE>

            (i) a sale or other disposition of all or substantially all, as
determined by the Board in its sole discretion, of the consolidated assets of
the Company and its Subsidiaries;

            (ii) a sale or other disposition of at least ninety percent (90%) of
the outstanding securities of the Company;

            (iii) the consummation of a merger, consolidation or similar
transaction following which the Company is not the surviving corporation; or

            (iv) the consummation of a merger, consolidation or similar
transaction following which the Company is the surviving corporation but the
shares of Common Stock outstanding immediately preceding the merger,
consolidation or similar transaction are converted or exchanged by virtue of the
merger, consolidation or similar transaction into other property, whether in the
form of securities, cash or otherwise.

      (n) "DIRECTOR" means a member of the Board.

      (o) "DISABILITY" means the permanent and total disability of a person
within the meaning of Section 22(e)(3) of the Code.

      (p) "EMPLOYEE" means any person employed by the Company or an Affiliate.
However, service solely as a Director, or payment of a fee for such services,
shall not cause a Director to be considered an "Employee" for purposes of the
Plan.

      (q) "ENTITY" means a corporation, partnership or other entity.

      (r) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.

      (s) "EXCHANGE ACT PERSON" means any natural person, Entity or "group"
(within the meaning of Section 13(d) or 14(d) of the Exchange Act), except that
"Exchange Act Person" shall not include (i) the Company or any Subsidiary of the
Company, (ii) any employee benefit plan of the Company or any Subsidiary of the
Company or any trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any Subsidiary of the Company, (iii) an
underwriter temporarily holding securities pursuant to an offering of such
securities, (iv) an Entity Owned, directly or indirectly, by the stockholders of
the Company in substantially the same proportions as their Ownership of stock of
the Company; or (v) any natural person, Entity or "group" (within the meaning of
Section 13(d) or 14(d) of the Exchange Act) that, as of the effective date of
the Plan as set forth in Section 14, is the Owner, directly or indirectly, of
securities of the Company representing more than fifty percent (50%) of the
combined voting power of the Company's then outstanding securities.

      (t) "FAIR MARKET VALUE" means, as of any date, the value of the Common
Stock determined as follows:

            (i) If the Common Stock is listed on any established stock exchange
or traded on the Nasdaq National Market or the Nasdaq SmallCap Market, the Fair
Market Value of a share of Common Stock shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the

                                       4.
<PAGE>

greatest volume of trading in the Common Stock) on the date in question, as
reported in The Wall Street Journal or such other source as the Board deems
reliable. If there is no closing sales price (or closing bid if no sales were
reported) for the Common Stock on the date in question, then the Fair Market
Value shall be the closing selling price (or closing bid if no sales were
reported) on the last preceding date for which such quotation exists.

            (ii) In the absence of such markets for the Common Stock, the Fair
Market Value shall be determined by the Board in good faith.

      (u) "INITIAL GRANT" means an Option granted to a Non-Employee Director who
meets the specified criteria pursuant to Section 6(a).

      (v) "IPO DATE" means the date of the underwriting agreement between the
Company and the underwriter(s) managing the initial public offering of the
Common Stock, pursuant to which the Common Stock is priced for the initial
public offering.

      (w) "NON-EMPLOYEE DIRECTOR" means a Director who is not an Employee.

      (x) "NONSTATUTORY STOCK OPTION" means an Option not intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

      (y) "OFFICER" means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

      (z) "OPTION" means a Nonstatutory Stock Option granted pursuant to the
Plan.

      (aa) "OPTION AGREEMENT" means a written agreement between the Company and
an Optionholder evidencing the terms and conditions of an individual Option
grant. Each Option Agreement shall be subject to the terms and conditions of the
Plan.

      (bb) "OPTIONHOLDER" means a person to whom an Option is granted pursuant
to the Plan or, if applicable, such other person who holds an outstanding
Option.

      (cc) "OWN," "OWNED," "OWNER," "OWNERSHIP" A person or Entity shall be
deemed to "Own," to have "Owned," to be the "Owner" of, or to have acquired
"Ownership" of securities if such person or Entity, directly or indirectly,
through any contract, arrangement, understanding, relationship or otherwise, has
or shares voting power, which includes the power to vote or to direct the
voting, with respect to such securities.

      (dd) "PLAN" means this Stentor, Inc. 2005 Non-Employee Directors' Stock
Option Plan.

      (ee) "RULE 16b-3" means Rule 16b-3 promulgated under the Exchange Act or
any successor to Rule 16b-3, as in effect from time to time.

      (ff) "SECURITIES ACT" means the Securities Act of 1933, as amended.

                                       5.
<PAGE>

      (gg) "SUBSIDIARY" means, with respect to the Company, (i) any corporation
of which more than fifty percent (50%) of the outstanding capital stock having
ordinary voting power to elect a majority of the board of directors of such
corporation (irrespective of whether, at the time, stock of any other class or
classes of such corporation shall have or might have voting power by reason of
the happening of any contingency) is at the time, directly or indirectly, Owned
by the Company, and (ii) any partnership in which the Company has a direct or
indirect interest (whether in the form of voting or participation in profits or
capital contribution) of more than fifty percent (50%).

3. ADMINISTRATION.

      (a) ADMINISTRATION BY BOARD. The Board shall administer the Plan. The
Board may not delegate administration of the Plan.

      (b) POWERS OF BOARD. The Board shall have the power, subject to, and
within the limitations of, the express provisions of the Plan:

            (i) To determine the provisions of each Option to the extent not
specified in the Plan.

            (ii) To construe and interpret the Plan and Options granted under
it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any Option Agreement, in a
manner and to the extent it shall deem necessary or expedient to make the Plan
fully effective.

            (iii) To amend the Plan or an Option as provided in Section 12.

            (iv) To terminate or suspend the Plan as provided in Section 13.

            (v) Generally, to exercise such powers and to perform such acts as
the Board deems necessary or expedient to promote the best interests of the
Company and that are not in conflict with the provisions of the Plan.

      (c) EFFECT OF BOARD'S DECISION. All determinations, interpretations and
constructions made by the Board in good faith shall not be subject to review by
any person and shall be final, binding and conclusive on all persons.

4. SHARES SUBJECT TO THE PLAN.

      (a) SHARE RESERVE. Subject to the provisions of Section 11(a) relating to
Capitalization Adjustments, the number of shares of Common Stock that may be
issued pursuant to Options shall not exceed in the aggregate four hundred
thousand (400,000), plus an automatic annual increase beginning on January 1,
2006 and ending on (and including) January 1, 2015, in an amount equal to the
number of shares subject to Options granted during the preceding calendar year;
provided, however, that such automatic annual increase shall not exceed three
hundred thousand (300,000) shares. Notwithstanding the foregoing, the Board may
act prior to the first day of any calendar year, to provide that there shall be
no increase in the share reserve

                                       6.
<PAGE>

for such calendar year or that the increase in the share reserve for such
calendar year shall be a lesser number of shares of Common Stock than would
otherwise occur pursuant to the preceding sentence.

      (b) REVERSION OF SHARES TO THE SHARE RESERVE. If an Option shall for any
reason expire or otherwise terminate, in whole or in part, without having been
exercised in full, the shares of Common Stock not acquired under such Option
shall revert to and again become available for issuance under the Plan. If any
shares subject to an Option are not delivered to an Optionholder because such
shares are withheld for the payment of taxes or the Option is exercised through
a reduction of shares subject to the Option (i.e., "net exercised"), the number
of shares that are not delivered to the Optionholder shall remain available for
issuance under the Plan. If the exercise price of an Option is satisfied by
tendering shares of Common Stock held by the Optionholder (either by actual
delivery or attestation), then the number of shares so tendered shall remain
available for issuance under the Plan.

      (c) SOURCE OF SHARES. The stock issuable under the Plan shall be shares of
authorized but unissued or reacquired Common Stock, including shares repurchased
by the Company on the open market.

5. ELIGIBILITY.

      The Options shall automatically be granted under the Plan as set forth in
Section 6 to all Non-Employee Directors who meet the specified criteria.

6. NON-DISCRETIONARY GRANTS.

      (a) INITIAL GRANTS. Without any further action of the Board, each person
who after the IPO Date is elected or appointed for the first time to be a
Non-Employee Director automatically shall, upon the date of his or her initial
election or appointment to be a Non-Employee Director, be granted an Initial
Grant to purchase forty thousand (40,000) shares of Common Stock on the terms
and conditions set forth herein.

      (b) ANNUAL GRANTS. Without any further action of the Board, on the date of
each Annual Meeting, commencing with the Annual Meeting in 2006, each person who
is then a Non-Employee Director automatically shall be granted an Annual Grant
to purchase ten thousand (10,000) shares of Common Stock on the terms and
conditions set forth herein provided, however, that if the person has not been
serving as an Non-Employee Director for the entire period since the preceding
Annual Meeting, then the number of shares subject to such Annual Grant shall be
reduced pro rata for each full quarter prior to the date of grant during which
such person did not serve as an Non-Employee Director.

7. OPTION PROVISIONS.

      Each Option shall be in such form and shall contain such terms and
conditions as required by the Plan. Each Option shall contain such additional
terms and conditions, not inconsistent with the Plan, as the Board shall deem
appropriate. Each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:

                                       7.
<PAGE>

      (a) TERM. No Option shall be exercisable after the expiration of ten (10)
years from the date it was granted.

      (b) EXERCISE PRICE. The exercise price of each Option shall be one hundred
percent (100%) of the Fair Market Value of the Common Stock subject to the
Option on the date the Option is granted.

      (c) CONSIDERATION. The purchase price of Common Stock acquired pursuant to
an Option may be paid, to the extent permitted by applicable law, in any
combination of (i) cash or check, (ii) delivery to the Company (either by actual
delivery or attestation) of shares of Common Stock held for more than six (6)
months (or such longer or shorter period of time necessary to avoid a charge to
earnings for financial accounting purposes), or (iii) to the extent permitted by
law, pursuant to a program developed under Regulation T as promulgated by the
Federal Reserve Board that, prior to the issuance of Common Stock, results in
either the receipt of cash (or check) by the Company or the receipt of
irrevocable instructions to pay the aggregate exercise price to the Company from
the sales proceeds.

      (d) TRANSFERABILITY. Except as otherwise provided for in this Section
7(d), an Option shall not be transferable except by will or by the laws of
descent and distribution and shall be exercisable only by the Optionholder
during the life of the Optionholder. However, an Option may be transferred for
no consideration upon written consent of the Board if (i) at the time of
transfer, a Form S-8 registration statement under the Securities Act is
available for the issuance of shares by the Company upon the exercise of such
transferred Option, or (ii) the transfer is to the Optionholder's employer at
the time of transfer or an affiliate of the Optionholder's employer at the time
of transfer. Any such transfer is subject to such limits as the Board may
establish, and subject to the transferee agreeing to remain subject to all the
terms and conditions applicable to the Option prior to such transfer. The
forgoing right to transfer the Option shall apply to the right to consent to
amendments to the Option Agreement for such Option. In addition, until the
Optionholder transfers the Option, an Optionholder may, by delivering written
notice to the Company, in a form provided by or otherwise satisfactory to the
Company, designate a third party who, in the event of the death of the
Optionholder, shall thereafter be entitled to exercise the Option.

      (e) VESTING. Options shall vest as follows:

            (i) INITIAL GRANT. The Initial Grant shall vest in a series of [___]
([___]) successive equal [___] installments over the Optionholder's Continuous
Service over the [___] ([___])-year period measured from the date of grant.

            (ii) ANNUAL GRANT. The Annual Grant shall vest in a series of [___]
([___]) successive equal [___] installments over the Optionholder's Continuous
Service over the [___] ([___])-year period measured from the date of grant.

      (f) EARLY EXERCISE. The Option may, but need not, include a provision
whereby the Optionholder may elect at any time before the Optionholder's
Continuous Service terminates to exercise the Option as to any part or all of
the shares of Common Stock subject to the Option prior to the full vesting of
the Option. Any unvested shared of Common Stock so purchased may

                                       8.
<PAGE>

be subject to a repurchase option in favor of the Company or to any other
restriction the Board determines to be appropriate. The Company will not
exercise its repurchase option until at least six (6) months (or such longer or
shorter period of time required to avoid a charge to earnings for financial
accounting purposes) have elapsed following exercise of the Option unless the
Board otherwise specifically provides in the Option.

      (g) TERMINATION OF CONTINUOUS SERVICE. In the event that an Optionholder's
Continuous Service terminates (other than upon the Optionholder's death or
Disability or upon a Change in Control), the Optionholder may exercise his or
her Option (to the extent that the Optionholder was entitled to exercise such
Option as of the date of termination of Continuous Service) but only within such
period of time ending on the earlier of (i) the date three (3) months following
the termination of the Optionholder's Continuous Service (or such longer or
shorter period specified in the Option Agreement), or (ii) the expiration of the
term of the Option as set forth in the Option Agreement. If, after termination
of Continuous Service, the Optionholder does not exercise his or her Option
within the time specified herein or in the Option Agreement (as applicable), the
Option shall terminate.

      (h) EXTENSION OF TERMINATION DATE. If the exercise of the Option following
the termination of the Optionholder's Continuous Service (other than upon the
Optionholder's death or Disability or upon a Change in Control) would be
prohibited at any time solely because the issuance of shares of Common Stock
would violate the registration requirements under the Securities Act, then the
Option shall terminate on the earlier of (i) the expiration of a period of three
(3) months after the termination of the Optionholder's Continuous Service during
which the exercise of the Option would not be in violation of such registration
requirements, or (ii) the expiration of the term of the Option as set forth in
the Option Agreement.

      (i) DISABILITY OF OPTIONHOLDER. In the event that an Optionholder's
Continuous Service terminates as a result of the Optionholder's Disability, the
Optionholder may exercise his or her Option (to the extent that the Optionholder
was entitled to exercise it as of the date of termination), but only within such
period of time ending on the earlier of (i) the date twelve (12) months
following such termination of Continuous Service, or (ii) the expiration of the
term of the Option as set forth in the Option Agreement. If, after termination,
the Optionholder does not exercise his or her Option within the time specified
herein or in the Option Agreement, the Option shall terminate.

      (j) DEATH OF OPTIONHOLDER. In the event that (i) an Optionholder's
Continuous Service terminates as a result of the Optionholder's death, or (ii)
the Optionholder dies within the three-month period after the termination of the
Optionholder's Continuous Service for a reason other than death, then the Option
may be exercised (to the extent the Optionholder was entitled to exercise such
Option as of the date of death) by the Optionholder's estate, by a person who
acquired the right to exercise the Option by bequest or inheritance or by a
person designated to exercise the Option upon the Optionholder's death, but only
within the period ending on the earlier of (i) the date eighteen (18) months
following the date of death, or (ii) the expiration of the term of such Option
as set forth in the Option Agreement. If, after the Optionholder's death, the
Option is not exercised within the time specified herein, the Option shall
terminate.

                                       9.
<PAGE>

      (k) TERMINATION UPON CHANGE IN CONTROL. In the event that an
Optionholder's Continuous Service terminates as of, or within twelve (12) months
following a Change in Control, the Optionholder may exercise his or her Option
(to the extent that the Optionholder was entitled to exercise such Option as of
the date of termination of Continuous Service) within such period of time ending
on the earlier of (i) the date twelve (12) months following the effective date
of the Change in Control (or such longer or shorter period specified in the
Option Agreement), or (ii) the expiration of the term of the Option as set forth
in the Option Agreement. If, after termination of Continuous Service, the
Optionholder does not exercise his or her Option within the time specified
herein or in the Option Agreement (as applicable), the Option shall terminate.

8. SECURITIES LAW COMPLIANCE.

      The Company shall seek to obtain from each regulatory commission or agency
having jurisdiction over the Plan such authority as may be required to grant
Options and to issue and sell shares of Common Stock upon exercise of the
Options; provided, however, that this undertaking shall not require the Company
to register under the Securities Act the Plan, any Option or any Common Stock
issued or issuable pursuant to any such Option. If, after reasonable efforts,
the Company is unable to obtain from any such regulatory commission or agency
the authority that counsel for the Company deems necessary for the lawful
issuance and sale of Common Stock under the Plan, the Company shall be relieved
from any liability for failure to issue and sell Common Stock upon exercise of
such Options unless and until such authority is obtained.

9. USE OF PROCEEDS FROM SALES OF COMMON STOCK.

      Proceeds from the sale of shares of Common Stock pursuant to Options shall
constitute general funds of the Company.

10. MISCELLANEOUS.

      (a) STOCKHOLDER RIGHTS. No Optionholder shall be deemed to be the holder
of, or to have any of the rights of a holder with respect to, any shares of
Common Stock subject to such Option unless and until such Optionholder has
satisfied all requirements for exercise of the Option pursuant to its terms.

      (b) NO SERVICE RIGHTS. Nothing in the Plan, any instrument executed, or
Option granted pursuant thereto shall confer upon any Optionholder any right to
continue to serve the Company as a Non-Employee Director or shall affect the
right of the Company or an Affiliate to terminate the service of a Director
pursuant to the Bylaws of the Company or an Affiliate, and any applicable
provisions of the corporate law of the state in which the Company or the
Affiliate is incorporated, as the case may be.

      (c) INVESTMENT ASSURANCES. The Company may require an Optionholder, as a
condition of exercising or acquiring Common Stock under any Option, (i) to give
written assurances satisfactory to the Company as to the Optionholder's
knowledge and experience in financial and business matters and/or to employ a
purchaser representative reasonably satisfactory to the Company who is
knowledgeable and experienced in financial and business matters and that he or
she is capable of evaluating, alone or together with the purchaser

                                      10.
<PAGE>

representative, the merits and risks of exercising the Option; and (ii) to give
written assurances satisfactory to the Company stating that the Optionholder is
acquiring the Common Stock subject to the Option for the Optionholder's own
account and not with any present intention of selling or otherwise distributing
the Common Stock. The foregoing requirements, and any assurances given pursuant
to such requirements, shall be inoperative if (i) the issuance of the shares
upon the exercise or acquisition of Common Stock under the Option has been
registered under a then currently effective registration statement under the
Securities Act, or (ii) as to any particular requirement, a determination is
made by counsel for the Company that such requirement need not be met in the
circumstances under the then applicable securities laws. The Company may, upon
advice of counsel to the Company, place legends on stock certificates issued
under the Plan as such counsel deems necessary or appropriate in order to comply
with applicable securities laws, including, but not limited to, legends
restricting the transfer of the Common Stock.

      (d) WITHHOLDING OBLIGATIONS. The Optionholder may satisfy any federal,
state or local tax withholding obligation relating to the exercise or
acquisition of Common Stock under an Option by any of the following means (in
addition to the Company's right to withhold from any compensation paid to the
Optionholder by the Company) or by a combination of such means: (i) tendering a
cash payment; (ii) authorizing the Company to withhold shares from the shares of
the Common Stock otherwise issuable to the Optionholder as a result of the
exercise or acquisition of Common Stock under the Option; provided, however,
that no shares of Common Stock are withheld with a value exceeding the minimum
amount of tax required to be withheld by law; or (iii) delivering to the Company
owned and unencumbered shares of the Common Stock.

      (e) ELECTRONIC DELIVERY. Any reference herein to a "written" agreement or
document shall include any agreement or document delivered electronically or
posted on the Company's intranet.

11. ADJUSTMENTS UPON CHANGES IN COMMON STOCK; CORPORATE TRANSACTIONS.

      (a) CAPITALIZATION ADJUSTMENTS. If any change is made in, or other events
occur with respect to, the Common Stock subject to the Plan or subject to any
Option after the effective date of the Plan set forth in Section 14 without the
receipt of consideration by the Company (through merger, consolidation,
reorganization, recapitalization, reincorporation, stock dividend, dividend in
property other than cash, stock split, liquidating dividend, combination of
shares, exchange of shares, change in corporate structure or other transaction
not involving the receipt of consideration by the Company (each a
"CAPITALIZATION ADJUSTMENT")), the Plan shall be appropriately adjusted in the
class(es) and maximum number of securities subject both to the Plan pursuant to
Section 4 and to the nondiscretionary Options specified in Section 6, and the
outstanding Options will be appropriately adjusted in the class(es) and number
of securities and price per share of stock subject to such outstanding Options.
The Board shall make such adjustments, and its determination shall be final,
binding and conclusive. (Notwithstanding the foregoing, the conversion of any
convertible securities of the Company shall not be treated as a transaction
"without receipt of consideration" by the Company.)

                                      11.
<PAGE>

      (b) DISSOLUTION OR LIQUIDATION. In the event of a dissolution or
liquidation of the Company, all outstanding Options shall terminate immediately
prior to the completion of such dissolution or liquidation.

      (c) CORPORATE TRANSACTION.

            (i) OPTIONS MAY BE ASSUMED. In the event of a Corporate Transaction,
any surviving corporation or acquiring corporation (or the surviving or
acquiring corporation's parent company) may assume or continue any or all
Options outstanding under the Plan or may substitute similar stock options for
Options outstanding under the Plan (including but not limited to, options to
acquire the same consideration paid to the stockholders of the Company pursuant
to the Corporate Transaction), and any reacquisition or repurchase rights held
by the Company in respect of Common Stock issued pursuant to Options may be
assigned by the Company to the successor of the Company (or the successor's
parent company, if any), in connection with such Corporate Transaction. A
surviving corporation or acquiring corporation not choose to assume or continue
only a portion of an Option or substitute a similar option for only a portion of
an Option.

            (ii) OPTIONS HELD BY ACTIVE OPTIONHOLDERS. In the event of a
Corporate Transaction in which the surviving corporation or acquiring
corporation (or its parent company) does not assume or continue such outstanding
Options or substitute similar stock options for such outstanding Options, then
with respect to Options that have not been assumed, continued or substituted and
that are held by Optionholders whose Continuous Service has not terminated prior
to the effective time of the Corporate Transaction (referred to as the "ACTIVE
OPTIONHOLDERS"), the vesting of such Options (and, if applicable, the time at
which such Options may be exercised) shall (contingent upon the effectiveness of
the Corporate Transaction) be accelerated in full to a date prior to the
effective time of such Corporate Transaction as the Board shall determine (or,
if the Board shall not determine such a date, to the date that is five (5) days
prior to the effective time of the Corporate Transaction), and the Options shall
terminate if not exercised (if applicable) at or prior to the effective time of
the Corporate Transaction, and any reacquisition or repurchase rights held by
the Company with respect to such Options shall lapse (contingent upon the
effectiveness of the Corporate Transaction).

            (iii) OPTIONS HELD BY FORMER OPTIONHOLDERS. In the event of a
Corporate Transaction in which the surviving corporation or acquiring
corporation (or its parent company) does not assume or continue such outstanding
Options or substitute similar stock options for such outstanding Options, then
with respect to any other Options that have not been assumed, continued or
substituted and that are held by persons other than Active Optionholders, the
vesting of such Options (and, if applicable, the time at which such Options may
be exercised) shall not be accelerated unless otherwise provided in Section
11(d) or in a written agreement between the Company or any Affiliate and the
holder of such Options, and such Options shall terminate if not exercised (if
applicable) prior to the effective time of the Corporate Transaction; provided,
however, that any reacquisition or repurchase rights held by the Company with
respect to such Options shall not terminate and may continue to be exercised
notwithstanding the Corporate Transaction.

                                      12.
<PAGE>

            (iv) PAYMENT FOR OPTIONS IN LIEU OF EXERCISE. Notwithstanding the
foregoing, in the event an Option will terminate if not exercised prior to the
effective time of a Corporate Transaction, the Board may provide, in its sole
discretion, that the holder of such Option may not exercise such Option but will
receive a payment, in such form as may be determined by the Board, equal in
value to the excess, if any, of (i) the value of the property the holder of the
Option would have received upon the exercise of the Option, over (ii) the
exercise price payable by the Optionholder in connection with such exercise.

      (d) CHANGE IN CONTROL. In the event that an Optionholder is required to
resign his or her position as a Non-Employee Director as a condition of a Change
in Control, the outstanding Options of such Optionholder shall become fully
vested and exercisable immediately prior to the effectiveness of such
resignation (and contingent upon the effectiveness of the Change in Control).

      (e) PARACHUTE PAYMENTS.

            (i) If the acceleration of the vesting and exercisability of Options
provided for in Sections 11(c) and 11(d), together with payments and other
benefits of an Optionholder, (collectively, the "PAYMENT") (i) constitute a
"parachute payment" within the meaning of Section 280G of the Code, or any
comparable successor provisions, and (ii) but for this Section 11(e) would be
subject to the excise tax imposed by Section 4999 of the Code, or any comparable
successor provisions (the "EXCISE TAX"), then such Payment shall be either (1)
provided to such Optionholder in full, or (2) provided to such Optionholder as
to such lesser extent that would result in no portion of such Payment being
subject to the Excise Tax, whichever of the foregoing amounts, when taking into
account applicable federal, state, local and foreign income and employment
taxes, the Excise Tax, and any other applicable taxes, results in the receipt by
such Optionholder, on an after-tax basis, of the greatest amount of the Payment,
notwithstanding that all or some portion of the Payment may be subject to the
Excise Tax.

            (ii) Unless the Company and such Optionholder otherwise agree in
writing, any determination required under this Section 11(e) shall be made in
writing in good faith by the Accountant. If a reduction in the Payment is to be
made as provided above, reductions shall occur in the following order unless the
Optionholder elects in writing a different order (provided, however, that such
election shall be subject to Company approval if made on or after the date that
triggers the Payment or a portion thereof): (i) reduction of cash payments; (ii)
cancellation of accelerated vesting of Options; and (iii) reduction of other
benefits paid to the Optionholder. If acceleration of vesting of Options is to
be reduced, such acceleration of vesting shall be cancelled in the reverse order
of date of grant of Options (i.e., the earliest granted Option cancelled last)
unless the Optionholder elects in writing a different order for cancellation.

            (iii) For purposes of making the calculations required by this
Section 11(e), the Accountant may make reasonable assumptions and approximations
concerning applicable taxes and may rely on reasonable, good faith
interpretations concerning the application of the Code and other applicable
legal authority. The Company and the Optionholder shall furnish to the
Accountant such information and documents as the Accountant may reasonably
request in order to make such a determination. The Company shall bear all costs
the Accountant may reasonably incur in connection with any calculations
contemplated by this Section 11(e).

                                      13.
<PAGE>

            (iv) If, notwithstanding any reduction described above, the Internal
Revenue Service (the "IRS") determines that the Optionholder is liable for the
Excise Tax as a result of the Payment, then the Optionholder shall be obligated
to pay back to the Company, within thirty (30) days after a final IRS
determination or, in the event that the Optionholder challenges the final IRS
determination, a final judicial determination, a portion of the Payment (the
"REPAYMENT AMOUNT"). The Repayment Amount with respect to the Payment shall be
the smallest such amount, if any, as shall be required to be paid to the Company
so that the Optionholder's net after-tax proceeds with respect to the Payment
(after taking into account the payment of the Excise Tax and all other
applicable taxes imposed on the Payment) shall be maximized. The Repayment
Amount with respect to the Payment shall be zero if a Repayment Amount of more
than zero would not result in the Optionholder's net after-tax proceeds with
respect to the Payment being maximized. If the Excise Tax is not eliminated
pursuant to this paragraph, the Optionholder shall pay the Excise Tax.

            (v) Notwithstanding any other provision of this Section 11(e), if
(i) there is a reduction in the Payment as described above, (ii) the IRS later
determines that the Optionholder is liable for the Excise Tax, the payment of
which would result in the maximization of the Optionholder's net after-tax
proceeds of the Payment (calculated as if the Payment had not previously been
reduced), and (iii) the Optionholder pays the Excise Tax, then the Company shall
pay or otherwise provide to the Optionholder that portion of the Payment that
was reduced pursuant to this Section 11(e) contemporaneously or as soon as
administratively possible after the Optionholder pays the Excise Tax so that the
Optionholder's net after-tax proceeds with respect to the Payment are maximized.

            (vi) If the Optionholder either (i) brings any action to enforce
rights pursuant to this Section 11(e), or (ii) defends any legal challenge to
his or her rights under this Section 11(e), the Optionholder shall be entitled
to recover attorneys' fees and costs incurred in connection with such action,
regardless of the outcome of such action; provided, however, that if such action
is commenced by the Optionholder, the court finds that the action was brought in
good faith.

12. AMENDMENT OF THE PLAN AND OPTIONS.

      (a) AMENDMENT OF PLAN. Subject to the limitations, if any, of applicable
law, the Board, at any time and from time to time, may amend the Plan. However,
except as provided in Section 11(a) relating to Capitalization Adjustments, no
amendment shall be effective unless approved by the stockholders of the Company
to the extent stockholder approval is necessary to satisfy applicable law.

      (b) STOCKHOLDER APPROVAL. The Board, in its sole discretion, may submit
any other amendment to the Plan for stockholder approval.

      (c) NO IMPAIRMENT OF RIGHTS. Rights under any Option granted before
amendment of the Plan shall not be impaired by any amendment of the Plan unless
(i) the Company requests the consent of the affected Optionholder, and (ii) such
Optionholder consents in writing.

                                      14.
<PAGE>

      (d) AMENDMENT OF OPTIONS. The Board, at any time and from time to time,
may amend the terms of any one or more Options; provided, however, that the
rights under any Option shall not be impaired by any such amendment unless (i)
the Company requests the consent of the Optionholder, and (ii) the Optionholder
consents in writing.

13. TERMINATION OR SUSPENSION OF THE PLAN.

      (a) PLAN TERM. The Board may suspend or terminate the Plan at any time. No
Options may be granted under the Plan while the Plan is suspended or after it is
terminated.

      (b) NO IMPAIRMENT OF RIGHTS. Suspension or termination of the Plan shall
not impair rights and obligations under any Option granted while the Plan is in
effect except with the written consent of the Optionholder.

14. EFFECTIVE DATE OF PLAN.

      The Plan shall become effective on the IPO Date, but no Option shall be
exercised unless and until the Plan has been approved by the stockholders of the
Company, which approval shall be within twelve (12) months before or after the
date the Plan is adopted by the Board.

15. CHOICE OF LAW.

      The law of the state of Delaware shall govern all questions concerning the
construction, validity and interpretation of this Plan, without regard to such
state's conflict of laws rules.

                                      15.
<PAGE>

                                  STENTOR, INC.
                 2005 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN

                                OPTION AGREEMENT
                           (NONSTATUTORY STOCK OPTION)

      Pursuant to your Option Grant Notice ("GRANT NOTICE") and this Option
Agreement, Stentor, Inc. (the "COMPANY") has granted you an option under its
2005 Non-Employee Directors' Stock Option Plan (the "PLAN") to purchase the
number of shares of the Company's Common Stock indicated in your Grant Notice at
the exercise price indicated in your Grant Notice. Defined terms not explicitly
defined in this Option Agreement but defined in the Plan shall have the same
definitions as in the Plan.

      The details of your option are as follows:

      1. VESTING. Subject to the limitations contained herein, your option will
vest as provided in your Grant Notice, provided that vesting will cease upon the
termination of your Continuous Service.

      2. NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of Common
Stock subject to your option and your exercise price per share referenced in
your Grant Notice may be adjusted from time to time for Capitalization
Adjustments.

      3. EXERCISE PRIOR TO VESTING ("EARLY EXERCISE"). If permitted in your
Grant Notice (i.e., the "Exercise Schedule" indicates that "Early Exercise" of
your option is permitted) and subject to the provisions of your option, you may
elect at any time that is both (i) during the period of your Continuous Service
and (ii) during the term of your option, to exercise all or part of your option,
including the nonvested portion of your option; provided, however, that:

            (a) a partial exercise of your option shall be deemed to cover first
vested shares of Common Stock and then the earliest vesting installment of
unvested shares of Common Stock;

            (b) any shares of Common Stock so purchased from installments that
have not vested as of the date of exercise shall be subject to the purchase
option in favor of the Company as described in the Company's form of Early
Exercise Stock Purchase Agreement; and

            (c) you shall enter into the Company's form of Early Exercise Stock
Purchase Agreement with a vesting schedule that will result in the same vesting
as if no early exercise had occurred.

      4. METHOD OF PAYMENT. Payment of the exercise price is due in full upon
exercise of all or any part of your option. You may elect to make payment of the
exercise price in cash or by check or in any other manner PERMITTED BY YOUR
GRANT NOTICE, which may include one or more of the following:

                                       1.
<PAGE>

            (a) In the Company's sole discretion at the time your option is
exercised and provided that at the time of exercise the Common Stock is publicly
traded and quoted regularly in The Wall Street Journal, pursuant to a program
developed under Regulation T as promulgated by the Federal Reserve Board that,
prior to the issuance of Common Stock, results in either the receipt of cash (or
check) by the Company or the receipt of irrevocable instructions to pay the
aggregate exercise price to the Company from the sales proceeds.

            (b) In the Company's sole discretion at the time your option is
exercised and provided that at the time of exercise the Common Stock is publicly
traded and quoted regularly in The Wall Street Journal, by delivery to the
Company (either by actual delivery or attestation) of already-owned shares of
Common Stock either that you have held for the period required to avoid a charge
to the Company's reported earnings (generally six (6) months) or that you did
not acquire, directly or indirectly from the Company, that are owned free and
clear of any liens, claims, encumbrances or security interests, and that are
valued at Fair Market Value on the date of exercise. "Delivery" for these
purposes, in the sole discretion of the Company at the time you exercise your
option, shall include delivery to the Company of your attestation of ownership
of such shares of Common Stock in a form approved by the Company.
Notwithstanding the foregoing, you may not exercise your option by tender to the
Company of Common Stock to the extent such tender would violate the provisions
of any law, regulation or agreement restricting the redemption of the Company's
stock.

      5. WHOLE SHARES. You may exercise your option only for whole shares of
Common Stock.

      6. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary
contained herein, you may not exercise your option unless the shares of Common
Stock issuable upon such exercise are then registered under the Securities Act
or, if such shares of Common Stock are not then so registered, the Company has
determined that such exercise and issuance would be exempt from the registration
requirements of the Securities Act. The exercise of your option also must comply
with other applicable laws and regulations governing your option, and you may
not exercise your option if the Company determines that such exercise would not
be in material compliance with such laws and regulations.

      7. TERM. You may not exercise your option before the commencement or after
the expiration of its term. The term of your option commences on the Date of
Grant and expires upon the earliest of the following:

            (a) three (3) months after the termination of your Continuous
Service for any reason other than your Disability or death or upon a Change in
Control, provided that if during any part of such three (3) month period your
option is not exercisable solely because of the condition set forth in Section
6, your option shall not expire until the earlier of the Expiration Date or
until it shall have been exercisable for an aggregate period of three (3) months
after the termination of your Continuous Service;

            (b) twelve (12) months after the termination of your Continuous
Service due to your Disability;

                                       2.
<PAGE>

            (c) eighteen (18) months after your death if you die either during
your Continuous Service or within three (3) months after your Continuous Service
terminates;

            (d) twelve (12) months after the effective date of a Change in
Control if termination occurs as of, or within twelve (12) months following the
effective date of such a Change in Control;

            (e) the Expiration Date indicated in your Grant Notice; or

            (f) the day before the tenth (10th) anniversary of the Date of
Grant.

      8. EXERCISE.

            (a) You may exercise the vested portion of your option (and the
unvested portion of your option if your Grant Notice so permits) during its term
by delivering a Notice of Exercise (in a form designated by the Company)
together with the exercise price to the Secretary of the Company, or to such
other person as the Company may designate, during regular business hours,
together with such additional documents as the Company may then require.

            (b) By exercising your option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the payment by you to the Company of any tax
withholding obligation of the Company arising by reason of (i) the exercise of
your option, (ii) the lapse of any substantial risk of forfeiture to which the
shares of Common Stock are subject at the time of exercise, or (iii) the
disposition of shares of Common Stock acquired upon such exercise.

      9. TRANSFERABILITY. Your option is transferable only by will or by the
laws of descent and distribution and is exercisable only by you during your
lifetime. However, you may transfer your option for no consideration upon
written consent of the Board (i) if, at the time of transfer, a Form S-8
registration statement under the Securities Act is available for the issuance of
shares by the Company upon the exercise of such transferred option or (ii) the
transfer is to your employer at the time of transfer or an affiliate of your
employer at the time of transfer. Any such transfer is subject to such limits as
the Board may establish, and subject to the transferee agreeing to remain
subject to all the terms and conditions applicable to your option prior to such
transfer. The forgoing right to transfer your option shall apply to the right to
consent to amendments to the Option Agreement for such option. In addition,
until you transfers the option, you may, by delivering written notice to the
Company, in a form provided by or otherwise satisfactory to the Company,
designate a third party who, in the event of your death, shall thereafter be
entitled to exercise your option.

      10. OPTION NOT A SERVICE CONTRACT. Your option is not an employment or
service contract, and nothing in your option shall be deemed to create in any
way whatsoever any obligation on your part to continue in the employ of the
Company or an Affiliate, or of the Company or an Affiliate to continue your
employment. In addition, nothing in your option shall obligate the Company or an
Affiliate, their respective stockholders, Boards of Directors, Officers or
Employees to continue any relationship that you might have as a Director or
Consultant for the Company or an Affiliate.

                                       3.
<PAGE>

      11. WITHHOLDING OBLIGATIONS.

            (a) At the time you exercise your option, in whole or in part, or at
any time thereafter as requested by the Company, you hereby authorize
withholding from payroll and any other amounts payable to you, and otherwise
agree to make adequate provision for (including by means of a "cashless
exercise" pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board to the extent permitted by the Company), any sums
required to satisfy the federal, state, local and foreign tax withholding
obligations of the Company or an Affiliate, if any, which arise in connection
with the exercise of your option.

            (b) Upon your request and subject to approval by the Company, in its
sole discretion, and compliance with any applicable legal conditions or
restrictions, the Company may withhold from fully vested shares of Common Stock
otherwise issuable to you upon the exercise of your option a number of whole
shares of Common Stock having a Fair Market Value, determined by the Company as
of the date of exercise, not in excess of the minimum amount of tax required to
be withheld by law (or such lower amount as may be necessary to avoid variable
award accounting). If the date of determination of any tax withholding
obligation is deferred to a date later than the date of exercise of your option,
share withholding pursuant to the preceding sentence shall not be permitted
unless you make a proper and timely election under Section 83(b) of the Code,
covering the aggregate number of shares of Common Stock acquired upon such
exercise with respect to which such determination is otherwise deferred, to
accelerate the determination of such tax withholding obligation to the date of
exercise of your option. Notwithstanding the filing of such election, shares of
Common Stock shall be withheld solely from fully vested shares of Common Stock
determined as of the date of exercise of your option that are otherwise issuable
to you upon such exercise. Any adverse consequences to you arising in connection
with such share withholding procedure shall be your sole responsibility.

            (c) You may not exercise your option unless the tax withholding
obligations of the Company and/or any Affiliate are satisfied. Accordingly, you
may not be able to exercise your option when desired even though your option is
vested, and the Company shall have no obligation to issue a certificate for such
shares of Common Stock or release such shares of Common Stock from any escrow
provided for herein unless such obligations are satisfied.

      12. NOTICES. Any notices provided for in your option or the Plan shall be
given in writing and shall be deemed effectively given upon receipt or, in the
case of notices delivered by mail by the Company to you, five (5) days after
deposit in the United States mail, postage prepaid, addressed to you at the last
address you provided to the Company.

      13. GOVERNING PLAN DOCUMENT. Your option is subject to all the provisions
of the Plan, the provisions of which are hereby made a part of your option, and
is further subject to all interpretations, amendments, rules and regulations,
which may from time to time be promulgated and adopted pursuant to the Plan. In
the event of any conflict between the provisions of your option and those of the
Plan, the provisions of the Plan shall control.

                                       4.