Document:

EX 10.4

    EXHIBIT
      10.4

    
      

       

      AMENDED
        AND RESTATED

      2005
        STOCK INCENTIVE PLAN

       

      ARTICLE
        ONE

       

      GENERAL
        PROVISIONS

       

      I.    PURPOSE
        OF THE PLAN

       

      This
        Amended and Restated 2005 Stock Incentive Plan is intended to promote the
        interests of Positron Corporation (the "Corporation") by providing eligible
        persons with the opportunity to acquire a proprietary interest, or otherwise
        increase their proprietary interest, in the Corporation as an incentive for
        them
        to remain in the Service of the Corporation.

       

      Capitalized
        terms shall have the meanings assigned to such terms in the attached
        Appendix.

       

      II.    STRUCTURE
        OF THE PLAN

       

      A.    The
        Plan
        shall be divided into two separate equity programs:

       

      
        	
              	-	
                the
                  Discretionary Option Grant Program under which eligible persons
                  may, at
                  the discretion of the Plan Administrator, be granted options to
                  purchase
                  shares of Common Stock and stock appreciation rights;
                  and

              

      

       

      
        	
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                the
                  Stock Issuance Program under which eligible persons may, at the
                  discretion
                  of the Plan Administrator, be issued shares of Common Stock directly,
                  either through the immediate purchase of such shares or as a bonus
                  for
                  services rendered the Corporation (or any Parent or
                  Subsidiary).

              

      

       

      B.    The
        provisions of Articles One and Four shall apply to all equity programs under
        the
        Plan and shall govern the interests of all persons under the Plan.

       

      III.    ADMINISTRATION
        OF THE PLAN

       

      A.    The
        Plan
        shall be administered by the Board or an Option Committee appointed by the
        Board. Should administration of the Plan be vested in an Option Committee,
        any
        discretionary option grants or stock issuances to members of the Option
        Committee must be authorized and approved by a disinterested majority of
        the
        Board.

       

      B.    Members
        of the Option Committee shall serve for such period of time as the Board
        may
        determine and may be removed by the Board at any time.

       

      C.    Each
        Plan
        Administrator shall, within the scope of its administrative functions under
        the
        Plan, have full power and authority (subject to the provisions of the Plan)
        to
        establish such rules and regulations as it may deem appropriate for proper
        administration of the Discretionary Option Grant and Stock Issuance Programs
        and
        to make such determinations under, and issue such interpretations of, the
        provisions of such programs and any outstanding options or stock issuances
        thereunder as it may deem necessary or advisable. Decisions of the Plan
        Administrator within the scope of its administrative functions under the
        Plan
        shall be final and binding on all parties who have an interest in the
        Discretionary Option Grant and Stock Issuance Programs under its jurisdiction
        or
        any option or stock issuance thereunder.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      D.    Service
        on the Option Committee shall constitute service as a Board member, and members
        of such committee shall accordingly be entitled to full indemnification and
        reimbursement as Board members for their service on such committee. No member
        of
        the Option Committee shall be liable for any act or omission made in good
        faith
        with respect to the Plan or any option grants or stock issuances under the
        Plan.

       

      IV.    ELIGIBILITY

       

      A.    The
        persons eligible to participate in the Discretionary Option Grant and Stock
        Issuance Programs are as follows:

       

      (i)    Employees,

       

      (ii)    Officers,
        members of the Board or the board of directors of any Parent or Subsidiary,
        and

       

      (iii)    consultants
        and other independent advisors who provide services to the Corporation (or
        any
        Parent or Subsidiary).

       

      B.    Each
        Plan
        Administrator shall, within the scope of its administrative jurisdiction
        under
        the Plan, have full authority to determine: (i) with respect to the option
        grants or stock appreciation rights under the Discretionary Option Grant
        Program, which eligible persons are to receive grants, the time or times
        when
        such grants are to be made, the number of shares to be covered by each such
        grant, the status of a granted option as either an Incentive Option or a
        Non-Statutory Option, the time or times when each option is to become
        exercisable, the vesting schedule (if any) applicable to the option shares
        and
        the maximum term for which the option is to remain outstanding; and (ii)
        with
        respect to stock issuances under the Stock Issuance Program, which eligible
        persons are to receive stock issuances, the time or times when such issuances
        are to be made, the number of shares to be issued to each Participant, the
        vesting schedule (if any) applicable to the issued shares and the consideration
        for such shares.

       

      C.    The
        Plan
        Administrator shall have the absolute discretion either to grant options
        or
        stock appreciation rights in accordance with the Discretionary Option Grant
        Program or to effect stock issuances or grant share right awards in accordance
        with the Stock Issuance Program.

       

      V.    STOCK
        SUBJECT TO THE PLAN

       

      A.    The
        stock
        issuable under the Plan shall be shares of authorized but unissued or reacquired
        Common Stock, including shares repurchased by the Corporation on the open
        market. The maximum number of shares of Common Stock initially reserved for
        issuance over the term of the Plan shall not exceed forty million (40,000,000)
        shares. 

       

      B.    Shares
        of
        Common Stock subject to outstanding options shall be available for subsequent
        issuance under the Plan to the extent (i) those options expire or terminate
        for
        any reason prior to exercise in full or (ii) the options are canceled in
        accordance with the cancellation-regrant provisions of Article Two. Unvested
        shares issued under the Plan and subsequently canceled or repurchased by
        the
        Corporation at the original exercise or issue price paid per share, pursuant
        to
        the Corporation's repurchase rights under the Plan, shall be added back to
        the
        number of shares of Common Stock reserved for issuance under the Plan and
        shall
        accordingly be available for reissuance through one or more subsequent option
        grants or direct stock issuances under the Plan. In addition, should the
        exercise price of an option under the Plan be paid with shares of Common
        Stock
        or should shares of Common Stock otherwise issuable under the Plan be withheld
        by the Corporation in satisfaction of the withholding taxes incurred in
        connection with the exercise of an option or the vesting of a stock issuance
        under the Plan, then the number of shares of Common Stock available for issuance
        under the Plan shall be reduced only by the net number of shares of Common
        Stock
        issued to the holder of such option or stock issuance, and not by the gross
        number of shares for which the option is exercised or which vest under the
        stock
        issuance. However, shares of Common Stock underlying one or more stock
        appreciation rights exercised under Section V of Article Two of the Plan
        shall
        not be available for subsequent issuance under the Plan.

       

      
        
          
          

        

        
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      C.    If
        any
        change is made to the Common Stock by reason of any stock split, stock dividend,
        recapitalization, combination of shares, exchange of shares or other change
        affecting the outstanding Common Stock as a class without the Corporation's
        receipt of consideration, appropriate adjustments shall be made to: (i) the
        maximum number and/or class of securities issuable under the Plan; and (ii)
        the
        number and/or class of securities and the exercise price per share in effect
        under each outstanding option under the Plan. Such adjustments to the
        outstanding options are to be effected in a manner which shall preclude the
        enlargement or dilution of rights and benefits under such options. The
        adjustments determined by the Plan Administrator shall be final, binding
        and
        conclusive.

       

      ARTICLE
        TWO

       

      DISCRETIONARY
        OPTION GRANT PROGRAM

       

      I.    OPTION
        TERMS

       

      Each
        option shall be evidenced by one or more documents in the form approved by
        the
        Plan Administrator; provided, however, that each such document shall comply
        with
        the terms specified below. Each document evidencing an Incentive Option shall,
        in addition, be subject to the provisions of the Plan applicable to Incentive
        Options.

       

      A.    EXERCISE
        PRICE.

       

      1.    The
        exercise price per share shall be fixed by the Plan Administrator but shall
        not
        be less than one hundred percent (100%) of the Fair Market Value per share
        of
        Common Stock on the option grant date.

       

      2.    The
        exercise price shall become immediately due upon exercise of the option and
        may,
        subject to the provisions of Section I of Article Four and the documents
        evidencing the option, be payable in one or more of the forms specified
        below:

       

      (i)    cash
        or
        check made payable to the Corporation, or

       

      (ii)    shares
        of
        Common Stock held for the requisite period necessary to avoid a charge to
        the
        Corporation's earnings for financial reporting purposes and valued at Fair
        Market Value on the Exercise Date, or

       

      
        
          
          

        

        
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      (iii)    to
        the
        extent the sale complies with all applicable laws relating to the regulation
        and
        sale of securities, through a special sale and remittance procedure pursuant
        to
        which the Optionee shall concurrently provide irrevocable written instructions
        to: (a) a Corporation-designated brokerage firm to effect the immediate sale
        of
        the purchased shares and remit to the Corporation, out of the sale proceeds
        available on the settlement date, sufficient funds to cover the aggregate
        exercise price payable for the purchased shares plus all applicable Federal,
        state and local income and employment taxes required to be withheld by the
        Corporation by reason of such exercise; and (b) the Corporation to deliver
        the
        certificates for the purchased shares directly to such brokerage firm in
        order
        to complete the sale, or

       

      (iv)    subject
        to such additional terms and conditions as the plan administrator shall
        determine, to have the number of shares deliverable to the option holder
        as a
        result of the exercise reduced by a number of shares sufficient to pay the
        amount the Corporation determines to be necessary to withhold for federal,
        state, local and other taxes as a result of the exercise of the option and,
        as
        long as no additional accounting expenses would result to the Corporation,
        to
        pay the exercise price of the option.

       

      Except
        to
        the extent such sale and remittance procedure is utilized, payment of the
        exercise price for the purchased shares must be made on the Exercise
        Date.

       

      B.    EXERCISE
        AND TERM OF OPTIONS. Each option shall be exercisable at such time or times,
        during such period and for such number of shares as shall be determined by
        the
        Plan Administrator and set forth in the documents evidencing the option.
        However, no option shall have a term in excess of ten (10) years measured
        from
        the option grant date.

       

      C.    EFFECT
        OF
        TERMINATION OF SERVICE.

       

      1.    The
        following provisions shall govern the exercise of any options held by the
        Optionee at the time of cessation of Service or death:

       

      (i)    Subject
        to subparagraph (iv) below, any option outstanding at the time of the
        Optionee's cessation of Service for any reason shall remain exercisable for
        such
        period of time thereafter as shall be determined by the Plan Administrator
        and
        set forth in the documents evidencing the option.

       

      (ii)    Any
        option held by the Optionee at the time of death and exercisable in whole
        or in
        part at that time may be subsequently exercised by the personal representative
        of the Optionee's estate or by the person or persons to whom the option is
        transferred pursuant to the Optionee's will or in accordance with the laws
        of
        descent and distribution or by the Optionee's designated beneficiary or
        beneficiaries of that option.

       

      (iii)    Except
        as
        otherwise determined in the discretion of the Plan Administrator either at
        the
        time the option is granted or at any time the option remains outstanding,
        should
        the Optionee's Service be terminated for Misconduct or should the Optionee
        otherwise engage in Misconduct while one or more options granted to the Optionee
        under this Article Two are outstanding, then all those options shall terminate
        immediately and cease to be outstanding.

       

      (iv)    During
        the applicable post-Service exercise period, the option may not be exercised
        in
        the aggregate for more than the number of vested shares for which the option
        is
        exercisable on the date of the Optionee's cessation of Service. Upon the
        expiration of the applicable exercise period or (if earlier) upon the expiration
        of the option term, the option shall terminate and cease to be outstanding
        for
        any vested shares for which the option has not been exercised. However, the
        option shall, immediately upon the Optionee's cessation of Service, terminate
        and cease to be outstanding to the extent the option is not otherwise at
        that
        time exercisable for vested shares.

       

      
        
          
          

        

        
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      2.    The
        Plan
        Administrator shall have complete discretion, either at the time an option
        is
        granted or at any time while the option remains outstanding, to:

       

      (i)    extend
        the period of time for which the option is to remain exercisable following
        the
        Optionee's cessation of Service from the limited exercise period otherwise
        in
        effect for that option to such greater period of time as the Plan Administrator
        shall deem appropriate, but in no event beyond the expiration of the option
        term, and/or

       

      (ii)    permit
        the option to be exercised, during the applicable post-Service exercise period,
        not only with respect to the number of vested shares of Common Stock for
        which
        such option is exercisable at the time of the Optionee's cessation of Service
        but also with respect to one or more additional installments in which the
        Optionee would have vested had the Optionee continued in Service.

       

      D.    STOCKHOLDER
        RIGHTS. The holder of an option shall have no stockholder rights with respect
        to
        the shares subject to the option until such person shall have exercised the
        option, paid the exercise price and become a holder of record of the purchased
        shares.

       

      E.    REPURCHASE
        RIGHTS. The Plan Administrator shall have the discretion to grant options
        which
        are exercisable for unvested shares of Common Stock. Should the Optionee
        cease
        Service while holding such unvested shares, the Corporation shall have the
        right
        to repurchase, at the purchase price paid per share, any or all of those
        unvested shares. The terms upon which such repurchase right shall be exercisable
        (including the period and procedure for exercise and the appropriate vesting
        schedule for the purchased shares) shall be established by the Plan
        Administrator and set forth in the document evidencing such repurchase
        right.

       

      F.    LIMITED
        TRANSFERABILITY OF OPTIONS. During the lifetime of the Optionee, Incentive
        Options shall be exercisable only by the Optionee and shall not be assignable
        or
        transferable other than by will or by the laws of descent and distribution
        following the Optionee's death. Non-Statutory Options shall be subject to
        the
        same limitation, except that a Non-Statutory Option may be assigned in whole
        or
        in part during Optionee's lifetime to one or more members of the Optionee's
        Immediate Family or to a trust established for the exclusive benefit of Optionee
        or one or more members of the Optionee's Immediate Family or to the Optionee's
        former spouse, to the extent such assignment is in connection with Optionee's
        estate plan or pursuant to a domestic relations order. The assigned portion
        shall be exercisable only by the person or persons who acquire a proprietary
        interest in the option pursuant to such assignment. The terms applicable
        to the
        assigned portion shall be the same as those in effect for this option
        immediately prior to such assignment and shall be set forth in such documents
        issued to the assignee as the Plan Administrator may deem appropriate.
        Notwithstanding the foregoing, the Optionee may also designate one or more
        persons as the beneficiary or beneficiaries of his or her outstanding options
        under this Article Two, and those options shall, in accordance with such
        designation, automatically be transferred to such beneficiary or beneficiaries
        upon the Optionee's death while holding those options. Such beneficiary or
        beneficiaries shall take the transferred option subject to all the terms
        and
        conditions of the applicable agreement evidencing each such transferred option,
        including (without limitation) the limited time period during which the option
        may be exercised following the Optionee's death.

       

      
        
          
          

        

        
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      II.    INCENTIVE
        OPTIONS

       

      The
        terms
        specified below shall be applicable to all Incentive Options. Except as modified
        by the provisions of this Section II, all the provisions of Articles One,
        Two
        and Four shall be applicable to Incentive Options. Options which are
        specifically designated as Non-Statutory Options when issued under the Plan
        shall NOT be subject to the terms of this Section II.

       

      A.    ELIGIBILITY.
        Incentive Options may only be granted to Employees.

       

      B.    EXERCISE
        PRICE. The exercise price per share shall not be less than one hundred percent
        (100%) of the Fair Market Value per share of Common Stock on the option grant
        date.

       

      C.    DOLLAR
        LIMITATION. The aggregate Fair Market Value of the shares of Common Stock
        (determined as of the respective date or dates of grant) for which one or
        more
        options granted to any Employee under the Plan (or any other option plan
        of the
        Corporation or any Parent or Subsidiary) may for the first time become
        exercisable as Incentive Options during any one calendar year shall not exceed
        the sum of One Hundred Thousand Dollars ($100,000). To the extent the Employee
        holds two (2) or more such options which become exercisable for the first
        time
        in the same calendar year, the foregoing limitation on the exercisability
        of
        such options as Incentive Options shall be applied on the basis of the order
        in
        which such options are granted.

       

      D.    FAILURE
        TO QUALIFY AS INCENTIVE OPTION. To the extent that any option governed by
        this
        Plan does not qualify as an Incentive Option by reason of the dollar limitation
        described in Section II.C of Article Two or for any other reason, such option
        shall be exercisable as a Non-Statutory Option under the Federal tax
        laws.

       

      E.    10%
        STOCKHOLDER. If any Employee to whom an Incentive Option is granted is a
        10%
        Stockholder, then the exercise price per share shall not be less than one
        hundred ten percent (110%) of the Fair Market Value per share of Common Stock
        on
        the option grant date, and the option term shall not exceed five (5) years
        measured from the option grant date.

       

      III.    CANCELLATION
        AND REGRANT OF OPTIONS

       

      The
        Plan
        Administrator shall have the authority to effect, at any time and from time
        to
        time, with the consent of the affected option holders, the cancellation of
        any
        or all outstanding options under the Discretionary Option Grant Program and
        to
        grant in substitution new options covering the same or different number of
        shares of Common Stock but with an exercise price per share based on the
        Fair
        Market Value per share of Common Stock on the new grant date.

       

      IV.    CHANGE
        IN
        CONTROL/HOSTILE TAKE-OVER

       

      A.    No
        option
        outstanding at the time of a Change in Control shall become exercisable on
        an
        accelerated basis if and to the extent: (i) that option is, in connection
        with
        the Change in Control, assumed by the successor corporation (or parent thereof)
        or otherwise continued in full force and effect pursuant to the terms of
        the
        Change in Control transaction, (ii) such option is replaced with a cash
        incentive program of the successor corporation which preserves the spread
        existing at the time of the Change in Control on the shares of Common Stock
        for
        which the option is not otherwise at that time exercisable and provides for
        subsequent payout in accordance with the same exercise/vesting schedule
        applicable to those option shares or (iii) the acceleration of such option
        is
        subject to other limitations imposed by the Plan Administrator at the time
        of
        the option grant. However, if none of the foregoing conditions are satisfied,
        then each option outstanding at the time of the Change in Control but not
        otherwise exercisable for all the shares of Common Stock at that time subject
        to
        such option shall automatically accelerate so that each such option shall,
        immediately prior to the effective date of the Change in Control, become
        exercisable for all the shares of Common Stock at the time subject to such
        option and may be exercised for any or all of those shares as fully vested
        shares of Common Stock.

       

      
        
          
          

        

        
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      B.    All
        of
        the Corporation's outstanding repurchase rights under the Discretionary Option
        Grant Program shall also terminate automatically, and the shares of Common
        Stock
        subject to those terminated rights shall immediately vest in full, in the
        event
        of any Change in Control, except to the extent: (i) those repurchase rights
        are
        assigned to the successor corporation (or parent thereof) or otherwise continued
        in full force and effect pursuant to the terms of the Change in Control
        transaction or (ii) such accelerated vesting is precluded by other limitations
        imposed by the Plan Administrator at the time the repurchase right is
        issued.

       

      C.    Immediately
        following the consummation of the Change in Control, all outstanding options
        shall terminate and cease to be outstanding, except to the extent assumed
        by the
        successor corporation (or parent thereof) or otherwise expressly continued
        in
        full force and effect pursuant to the terms of the Change in Control
        transaction.

       

      D.    Each
        option which is assumed in connection with a Change in Control or otherwise
        continued in effect shall be appropriately adjusted, immediately after such
        Change in Control, to apply to the number and class of securities which would
        have been issuable to the Optionee in consummation of such Change in Control
        had
        the option been exercised immediately prior to such Change in Control.
        Appropriate adjustments to reflect such Change in Control shall also be made
        to:
        (i) the exercise price payable per share under each outstanding option, provided
        the aggregate exercise price payable for such securities shall remain the
        same;
        (ii) the maximum number and/or class of securities available for issuance
        over
        the remaining term of the Plan; and (iii) the maximum number and/or class
        of
        securities for which any one person may be granted options, direct stock
        issuances and share right awards under the Plan per calendar year. To the
        extent
        the actual holders of the Corporation's outstanding Common Stock receive
        cash
        consideration for their Common Stock in consummation of the Change in Control
        transaction, the successor corporation may, in connection with the assumption
        of
        the outstanding options under the Discretionary Option Grant Program, substitute
        one or more shares of its own common stock with a fair market value equivalent
        to the cash consideration paid per share of Common Stock in such Change in
        Control transaction.

       

      E.    The
        Plan
        Administrator shall have the discretionary authority to structure one or
        more
        outstanding options under the Discretionary Option Grant Program so that
        those
        options shall, immediately prior to the effective date of a Change in Control,
        become exercisable for all the shares of Common Stock at that time subject
        to
        such options on an accelerated basis and may be exercised for any or all
        of such
        shares as fully vested shares of Common Stock, whether or not those options
        are
        to be assumed or otherwise continued in full force and effect or replaced
        with a
        cash incentive program pursuant to the express terms of the Change in Control
        transaction. In addition, the Plan Administrator shall have the discretionary
        authority to structure one or more of the Corporation's repurchase rights
        under
        the Discretionary Option Grant Program so that those rights shall immediately
        terminate at the time of such Change in Control and shall not be assignable
        to
        the successor corporation (or parent thereof), and the shares subject to
        those
        terminated rights shall accordingly vest in full at the time of such Change
        in
        Control.

       

      F.    The
        Plan
        Administrator shall have full power and authority to structure one or more
        outstanding options under the Discretionary Option Grant Program so that
        those
        options shall vest and become exercisable for all the shares of Common Stock
        at
        that time subject to such options on an accelerated basis in the event the
        Optionee's Service is subsequently terminated by reason of an Involuntary
        Termination within a designated period (not to exceed eighteen (18) months)
        following the effective date of any Change in Control in which those options
        do
        not otherwise accelerate. Any options so accelerated shall remain exercisable
        for fully vested shares of Common Stock until the expiration or sooner
        termination of the option term. In addition, the Plan Administrator may
        structure one or more of the Corporation's repurchase rights under the
        Discretionary Option Grant Program so that those rights shall immediately
        terminate with respect to any shares of Common Stock held by the Optionee
        at the
        time of his or her Involuntary Termination, and the shares subject to those
        terminated repurchase rights shall accordingly vest in full at that
        time.

       

      
        
          
          

        

        
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      G.    The
        Plan
        Administrator shall have the discretionary authority to structure one or
        more
        outstanding options under the Discretionary Option Grant Program so that
        those
        options shall, immediately prior to the effective date of a Hostile Take-Over,
        vest and become exercisable for all the shares of Common Stock at that time
        subject to such options on an accelerated basis and may be exercised for
        any or
        all of such shares as fully vested shares of Common Stock. In addition, the
        Plan
        Administrator shall have the discretionary authority to structure one or
        more of
        the Corporation's repurchase rights under the Discretionary Option Grant
        Program
        so that those rights shall terminate automatically upon the consummation
        of such
        Hostile Take-Over, and the shares subject to those terminated rights shall
        thereupon immediately vest in full. Alternatively, the Plan Administrator
        may
        condition the automatic acceleration of one or more outstanding options under
        the Discretionary Option Grant Program and the termination of one or more
        of the
        Corporation's outstanding repurchase rights under such program upon the
        Involuntary Termination of the Optionee's Service within a designated period
        (not to exceed eighteen (18) months) following the effective date of such
        Hostile Take-Over. Each option so accelerated shall remain exercisable for
        fully
        vested shares of Common Stock until the expiration or sooner termination
        of the
        option term.

       

      H.    The
        portion of any Incentive Option accelerated in connection with a Change in
        Control or Hostile Take-Over shall remain exercisable as an Incentive Option
        only to the extent the applicable One Hundred Thousand Dollar ($100,000)
        limitation is not exceeded. To the extent such dollar limitation is exceeded,
        the accelerated portion of such option shall be exercisable as a Non-Statutory
        Option under the Federal tax laws.

       

      I.    The
        grant
        of options under the Discretionary Option Grant Program shall in no way affect
        the right of the Corporation to adjust, reclassify, reorganize or otherwise
        change its capital or business structure or to merge, consolidate, dissolve,
        liquidate or sell or transfer all or any part of its business or
        assets.

       

      V.    STOCK
        APPRECIATION RIGHTS

       

      The
        Plan
        Administrator may, subject to such conditions as it may determine, grant
        to
        selected Optionees stock appreciation rights which will allow the holders
        of
        those rights to elect between the exercise of the underlying option for shares
        of Common Stock and the surrender of that option in exchange for a distribution
        from the Corporation in an amount equal to the excess of: (A) the Option
        Surrender Value of the number of shares for which the option is surrendered;
        over (B) the aggregate exercise price payable for such shares. The distribution
        may be made in shares of Common Stock valued at Fair Market Value on the
        option
        surrender date, in cash, or partly in shares and partly in cash, as the Plan
        Administrator shall in its sole discretion deem appropriate.

       

      
        
          
          

        

        
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      ARTICLE
        THREE

       

      STOCK
        ISSUANCE PROGRAM

       

      I.    STOCK
        ISSUANCES

       

      Shares
        of
        Common Stock may be issued under the Stock Issuance Program through direct
        and
        immediate issuances without any intervening option grants. Each such stock
        issuance shall be evidenced by a Stock Issuance Agreement which complies
        with
        the terms specified below. Shares of Common Stock may also be issued under
        the
        Stock Issuance Program pursuant to share right awards which entitle the
        recipients to receive those shares upon the attainment of designated performance
        goals. 

       

      II.    STOCK
        ISSUANCE TERMS

       

      A.    PURCHASE
        PRICE.

       

      1.    The
        purchase price per share shall be fixed by the Plan Administrator, but shall
        not
        be less than one hundred percent (100%) of the Fair Market Value per share
        of
        Common Stock on the issuance date.

       

      2.    Subject
        to the provisions of Section I of Article Four, shares of Common Stock may
        be
        issued under the Stock Issuance Program for any of the following items of
        consideration which the Plan Administrator may deem appropriate in each
        individual instance:

       

      (i)    cash
        or
        check made payable to the Corporation, or

       

      (ii)    past
        services rendered to the Corporation (or any Parent or Subsidiary).

       

      B.    VESTING
        PROVISIONS.

       

      1.    Shares
        of
        Common Stock issued under the Stock Issuance Program may, in the discretion
        of
        the Plan Administrator, be fully and immediately vested upon issuance or
        may
        vest in one or more installments over the Participant's period of Service
        or
        upon attainment of specified performance objectives. The elements of the
        vesting
        schedule applicable to any unvested shares of Common Stock issued under the
        Stock Issuance Program shall be determined by the Plan Administrator and
        incorporated into the Stock Issuance Agreement. Shares of Common Stock may
        also
        be issued under the Stock Issuance Program pursuant to share right awards
        which
        entitle the recipients to receive those shares upon the attainment of designated
        performance goals. Upon the attainment of such performance goals, fully vested
        shares of Common Stock shall be issued upon satisfaction of those share right
        awards.

       

      2.    Any
        new,
        substituted or additional securities or other property (including money paid
        other than as a regular cash dividend) which the Participant may have the
        right
        to receive with respect to the Participant's unvested shares of Common Stock
        by
        reason of any stock dividend, stock split, recapitalization, combination
        of
        shares, exchange of shares or other change affecting the outstanding Common
        Stock as a class without the Corporation's receipt of consideration shall
        be
        issued subject to: (i) the same vesting requirements applicable to the
        Participant's unvested shares of Common Stock; and (ii) such escrow arrangements
        as the Plan Administrator shall deem appropriate.

       

      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

      

       

      3.    The
        Participant shall have full stockholder rights with respect to any shares
        of
        Common Stock issued to the Participant under the Stock Issuance Program,
        whether
        or not the Participant's interest in those shares is vested. Accordingly,
        the
        Participant shall have the right to vote such shares and to receive any regular
        cash dividends paid on such shares.

       

      4.    Should
        the Participant cease to remain in Service while holding one or more unvested
        shares of Common Stock issued under the Stock Issuance Program or should
        the
        performance objectives not be attained with respect to one or more such unvested
        shares of Common Stock, then those shares shall be immediately surrendered
        to
        the Corporation for cancellation, and the Participant shall have no further
        stockholder rights with respect to those shares. To the extent the surrendered
        shares were previously issued to the Participant for consideration paid in
        cash
        or cash equivalent (including the Participant's purchase-money indebtedness
        but
        not including services rendered by the Participant), the Corporation shall
        repay
        to the Participant the cash consideration paid for the surrendered shares
        and
        shall cancel the unpaid principal balance of any outstanding purchase-money
        note
        of the Participant attributable to the surrendered shares.

       

      5.    The
        Plan
        Administrator may in its discretion waive the surrender and cancellation
        of one
        or more unvested shares of Common Stock which would otherwise occur upon
        the
        cessation of the Participant's Service or the non-attainment of the performance
        objectives applicable to those shares. Such waiver shall result in the immediate
        vesting of the Participant's interest in the shares as to which the waiver
        applies. Such waiver may be effected at any time, whether before or after
        the
        Participant's cessation of Service or the attainment or non-attainment of
        the
        applicable performance objectives.

       

      6.    Outstanding
        share right awards under the Stock Issuance Program shall automatically
        terminate, and no shares of Common Stock shall actually be issued in
        satisfaction of those awards, if the performance goals or Service requirements
        established for such awards are not attained. The Plan Administrator, however,
        shall have the discretionary authority to issue shares of Common Stock under
        one
        or more outstanding share right awards as to which the designated performance
        goals or Service requirements have not been attained.

       

      III.    CHANGE
        IN
        CONTROL/HOSTILE TAKE-OVER

       

      A.    All
        of
        the Corporation's outstanding repurchase rights under the Stock Issuance
        Program
        shall terminate automatically, and all the shares of Common Stock subject
        to
        those terminated rights shall immediately vest in full, in the event of any
        Change in Control, except to the extent (i) those repurchase rights are assigned
        to the successor corporation (or parent thereof) or otherwise continued in
        full
        force and effect pursuant to the express terms of the Change in Control
        transaction or (ii) such accelerated vesting is precluded by other limitations
        imposed in the Stock Issuance Agreement.

       

      B.    The
        Plan
        Administrator shall have the discretionary authority to structure one or
        more of
        the Corporation's repurchase rights under the Stock Issuance Program so that
        those rights shall automatically terminate in whole or in part upon the
        occurrence of a Change in Control and shall not be assignable to the successor
        corporation (or parent thereof), and the shares of Common Stock subject to
        those
        terminated rights shall immediately vest in full at the time of such Change
        in
        Control.

       

      C.    The
        Plan
        Administrator shall also have the discretionary authority to structure one
        or
        more of the Corporation's repurchase rights under the Stock Issuance Program
        so
        that those rights shall automatically terminate in whole or in part, and
        the
        shares of Common Stock subject to those terminated rights shall immediately
        vest
        in full, upon the Involuntary Termination of the Participant's Service within
        a
        designated period (not to exceed eighteen (18) months) following the effective
        date of any Change in Control in which those repurchase rights do not otherwise
        terminate.

       

      
        
          
          

        

        
          -10-

          
            

          

        

        
          
          

        

      

       

      D.    The
        Plan
        Administrator shall also have the discretionary authority to structure one
        or
        more of the Corporation's repurchase rights under the Stock Issuance Program
        so
        that those rights shall automatically terminate in whole or in part upon
        the
        occurrence of a Hostile Take-Over, and the shares of Common Stock subject
        to
        those terminated rights shall immediately vest in full at the time of such
        Hostile Take-Over.

       

      ARTICLE
        FOUR

       

      MISCELLANEOUS

       

      I.    FINANCING

       

      The
        Plan
        Administrator may permit any Optionee or Participant to pay the option exercise
        price under the Discretionary Option Grant Program or the purchase price
        of
        shares issued under the Stock Issuance Program by delivering a full-recourse,
        interest bearing promissory note payable in one or more installments. The
        terms
        of any such promissory note (including the interest rate and the terms of
        repayment) shall be established by the Plan Administrator in its sole
        discretion. In no event may the maximum credit available to the Optionee
        or
        Participant exceed the sum of (i) the aggregate option exercise price or
        purchase price payable for the purchased shares plus (ii) any Federal, state
        and
        local income and employment tax liability incurred by the Optionee or the
        Participant in connection with the option exercise or share
        purchase.

       

      II.    SHARE
        ESCROW/LEGENDS

       

      Unvested
        shares issued under the Plan may, in the Plan Administrator's discretion,
        be
        held in escrow by the Corporation until the Participant's interest in such
        shares vests or may be issued directly to the Participant with restrictive
        legends on the certificates evidencing those unvested shares.

       

      III.    TAX
        WITHHOLDING

       

      A.    The
        Corporation's obligation to deliver shares of Common Stock upon the exercise
        of
        options or the issuance or vesting of such shares under the Plan shall be
        subject to the satisfaction of all applicable Federal, state and local income
        and employment tax withholding requirements.

       

      B.    The
        Plan
        Administrator may, in its discretion, provide any or all holders of
        Non-Statutory Options or unvested shares of Common Stock under the Plan with
        the
        right to use shares of Common Stock in satisfaction of all or part of the
        Taxes
        incurred by such holders in connection with the exercise of their options
        or the
        vesting of their shares. Such right may be provided to any such holder in
        either
        or both of the following formats:

       

      1.    Stock
        Withholding: The election to have the Corporation withhold, from the shares
        of
        Common Stock otherwise issuable upon the exercise of such Non-Statutory Option
        or the vesting of such shares, a portion of those shares with an aggregate
        Fair
        Market Value equal to the amount of the Taxes (not to exceed one hundred
        percent
        (100%) of such Taxes) to be satisfied in such manner as designated by the
        holder
        in writing; or

       

      2.    Stock
        Delivery: The election to deliver to the Corporation, at the time the
        Non-Statutory Option is exercised or the shares vest, one or more shares
        of
        Common Stock previously acquired by such holder (other than in connection
        with
        the option exercise or share vesting triggering the Taxes) with an aggregate
        Fair Market Value equal to the amount of the Taxes (not to exceed one hundred
        percent (100%) of such Taxes) to be satisfied in such manner as designated
        by
        the holder in writing.

       

      
        
          
          

        

        
          -11-

          
            

          

        

        
          
          

        

      

       

      IV.    EFFECTIVE
        DATE AND TERM OF THE PLAN

       

      A.    The
        Plan
        shall become effective immediately upon the Plan Effective Date. Options
        may be
        granted under the Discretionary Option Grant at any time on or after the
        Plan
        Effective Date. However, no options granted under the Plan may be exercised,
        and
        no shares shall be issued under the Plan, until the Plan is approved by the
        Corporation's stockholders and until the Corporation shall have amended its
        articles of incorporation to provide for sufficient authorized shares of
        Common
        Stock to allow for the issuance of the total available shares under this
        Plan.
        If stockholder approval is not obtained within twelve (12) months after the
        Plan
        Effective Date, then all options previously granted under this Plan shall
        terminate and cease to be outstanding, and no further options shall be granted
        and no shares shall be issued under the Plan.

       

      B.    The
        Plan
        shall terminate upon the EARLIEST of (i) the tenth anniversary of the Plan
        Effective Date, (ii) the date on which all shares available for issuance
        under
        the Plan shall have been issued as fully-vested shares or (iii) the termination
        of all outstanding options in connection with a Change in Control. Upon such
        plan termination, all outstanding option grants and unvested stock issuances
        shall thereafter continue to have force and effect in accordance with the
        provisions of the documents evidencing such grants or issuances.

       

      V.    AMENDMENT
        OF THE PLAN

       

      A.    The
        Board
        shall have complete and exclusive power and authority to amend or modify
        the
        Plan in any or all respects. However, no such amendment or modification shall
        adversely affect the rights and obligations with respect to stock options
        or
        unvested stock issuances at the time outstanding under the Plan unless the
        Optionee or the Participant consents to such amendment or modification. In
        addition, certain amendments may require stockholder approval pursuant to
        applicable laws or regulations.

       

      B.    Options
        to purchase shares of Common Stock may be granted under the Discretionary
        Option
        Grant Program and shares of Common Stock may be issued under the Stock Issuance
        Program that are in each instance in excess of the number of shares then
        available for issuance under the Plan, provided any excess shares actually
        issued under those programs shall be held in escrow until there is obtained
        any
        required approval of an amendment sufficiently increasing the number of shares
        of Common Stock available for issuance under the Plan. If such approval is
        not
        obtained within twelve (12) months after the date the first such excess
        issuances are made, then (i) any unexercised options granted on the basis
        of
        such excess shares shall terminate and cease to be outstanding and (ii) the
        Corporation shall promptly refund to the Optionees and the Participants the
        exercise or purchase price paid for any excess shares issued under the Plan
        and
        held in escrow, together with interest (at the applicable Short Term Federal
        Rate) for the period the shares were held in escrow, and such shares shall
        thereupon be automatically canceled and cease to be outstanding.

       

      VI.    USE
        OF
        PROCEEDS

       

      Any
        cash
        proceeds received by the Corporation from the sale of shares of Common Stock
        under the Plan shall be used for general corporate purposes.

       

      
        
          
          

        

        
          -12-

          
            

          

        

        
          
          

        

      

       

      VII.    REGULATORY
        APPROVALS

       

      A.    The
        implementation of the Plan, the granting of any stock option under the Plan
        and
        the issuance of any shares of Common Stock (i) upon the exercise of any granted
        option or (ii) under the Stock Issuance Program shall be subject to the
        Corporation's procurement of all approvals and permits required by regulatory
        authorities having jurisdiction over the Plan, the stock options granted
        under
        it and the shares of Common Stock issued pursuant to it.

       

      B.    No
        shares
        of Common Stock or other assets shall be issued or delivered under the Plan
        unless and until there shall have been compliance with all applicable
        requirements of Federal and state securities laws, including the filing and
        effectiveness of the Form S-8 registration statement for the shares of Common
        Stock issuable under the Plan, and all applicable listing requirements of
        the
        stock exchange or automated quotation system, as applicable, on which Common
        Stock is then quoted for trading.

       

      VIII.    NO
        EMPLOYMENT/SERVICE RIGHTS

       

      Nothing
        in the Plan shall confer upon the Optionee or the Participant any right to
        continue in Service for any period of specific duration or interfere with
        or
        otherwise restrict in any way the rights of the Corporation (or any Parent
        or
        Subsidiary employing or retaining such person) or of the Optionee or the
        Participant, which rights are hereby expressly reserved by each, to terminate
        such person's Service at any time for any reason, with or without
        cause.

       

      IX.    SECTION
        162(M)

       

      It
        is the
        intent of the Corporation that any options granted under the Plan to a "covered
        employee" (as that term is defined in Section 162(m) of the Code) with an
        exercise price of not less than the Fair Market Value per share of Common
        Stock
        on the date of grant shall qualify as "qualified performance-based compensation"
        (within the meaning of Treas. Reg. § 1.162-27(e)) and the Plan shall be
        interpreted consistently with such intent. In furtherance of the foregoing,
        if
        and to the extent that the Corporation intends that an option granted under
        the
        Plan to any covered employee shall qualify as qualified performance-based
        compensation, all decisions regarding the grant of such option shall be made
        only by members of the Committee who qualify as "outside directors" within
        the
        meaning of Treas. Reg. § 1.162-27(e)(3).

       

      [REMAINDER
        OF THIS PAGE INTENTIONALLY LEFT BLANK]

       

      
        
          
          

        

        
          -13-

          
            

          

        

        
          
          

        

      

       

      APPENDIX

       

      The
        following definitions shall be in effect under the Plan:

       

      A.    BOARD
        shall mean the Corporation's Board of Directors.

       

      B.    CHANGE
        IN
        CONTROL shall mean a change in ownership or control of the Corporation effected
        through any of the following transactions:

       

      (i)    a
        stockholder-approved merger or consolidation in which securities possessing
        more
        than fifty percent (50%) of the total combined voting power of the Corporation's
        outstanding securities are transferred to a person or persons different from
        the
        persons holding those securities immediately prior to such transaction;
        or

       

      (ii)    a
        sale,
        transfer or other disposition of all or substantially all of the Corporation's
        assets; or

       

      (iii)    the
        acquisition, directly or indirectly by any person or related group of persons
        (other than the Corporation or a person that directly or indirectly controls,
        is
        controlled by, or is under common control with, the Corporation), of beneficial
        ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities
        possessing more than fifty percent (50%) of the total combined voting power
        of
        the Corporation's outstanding securities pursuant to a tender or exchange
        offer
        made directly to the Corporation's stockholders which the Board recommends
        such
        stockholders accept;

       

      provided,
        however, the Plan Administrator shall have the discretionary authority to
        determine that a transaction or series of transactions does not constitute
        a
        Change in Control. Such determination by the Plan Administrator shall govern
        notwithstanding the fact that the determination is contrary to paragraphs
        (i)
        through (iii) set forth above.

       

      C.    CODE
        shall mean the Internal Revenue Code of 1986, as amended.

       

      D.    COMMON
        STOCK shall mean the Corporation's common stock.

       

      E.    CORPORATION
        shall mean Positron Corporation, a Texas corporation, and its
        successors.

       

      F.    DISCRETIONARY
        OPTION GRANT PROGRAM shall mean the discretionary option grant program in
        effect
        under the Plan.

       

      G.    EMPLOYEE
        shall mean an "employee" of the Corporation (or any Parent or Subsidiary),
        within the meaning of Section 3401(c) of the Code and the regulations
        thereunder. 

       

      H.    EXERCISE
        DATE shall mean the date on which the Corporation shall have received written
        notice of the option exercise.

       

      
        
          
          

        

        
          
            APPENDIX

            -1-

          

          
            

          

        

        
          
          

        

      

       

      I.    FAIR
        MARKET VALUE per share of Common Stock on any relevant date shall be determined
        by the Plan Administrator in its sole, reasonable discretion. In determining
        the
        fair market value, the Plan Administrator may consider the following
        items:

       

      
        	 	
                (i)

              	
                the
                  closing
                  selling price per share of common stock on the date of grant.
                  

              

      

       

      This
        closing selling price shall be determined as follows:

       

      
        	 	
                a.

              	
                If
                  the Common Stock is at the time listed on the Nasdaq Stock Market,
                  then
                  the closing
                  selling price per
                  share of Common Stock on the date in question shall be used, as
                  such price
                  is reported by the National Association of Securities Dealers on
                  the
                  Nasdaq Stock Market and published in The
                  Wall Street Journal.
                  If there is no closing selling price for the Common Stock on the
                  date in
                  question, then the closing selling price on the last preceding
                  date for
                  which such quotation exists shall be
                  used;

              

      

       

      
        	 	
                b.

              	
                If
                  the Common Stock is at the time listed on any stock exchange, then
                  the
                  closing
                  selling price per
                  share of Common Stock on the date in question on the stock exchange
                  determined by the Plan Administrator to be the primary market for
                  the
                  Common Stock shall be used, as such price is officially quoted
                  in the
                  composite tape of transactions on such exchange and published in
                  The
                  Wall Street Journal.
                  If there is no closing selling price for the Common Stock on the
                  date in
                  question, then the closing selling price on the last preceding
                  date for
                  which such quotation exists shall be used;
                  or

              

      

       

      
        	 	
                c.

              	
                If
                  the Common Stock is regularly quoted by a recognized securities
                  dealer but
                  selling prices are not reported, the mean between the high bid
                  and low
                  asked prices for the Common Stock on the date of determination
                  shall be
                  used, as published in The
                  Wall Street Journal
                  or
                  such other source as the Plan Administrator deems
                  reliable.

              

      

       

      
        	 	
                (ii)

              	
                the
                  average trading volume of the Common Stock and the trading volume
                  on the
                  date of the grant;

              

      

       

      
        	 	
                (iii)

              	
                the
                  closing selling price per share of Common Stock on recent
                  dates;

              

      

       

      
        	 	
                (iv)

              	
                the
                  spread between the "bid" and "ask" prices on the date of grant
                  and on
                  recent dates;

              

      

       

      
        	 	
                (v)

              	
                the
                  price of the Corporation's securities in recently closed private
                  offerings; 

              

      

       

      
        	 	
                (vi)

              	
                appropriate
                  volume discounts based on the number of shares subject to the option
                  grant; and

              

      

       

      
        	 	
                (vii)

              	
                any
                  other information the plan administrator determines is applicable
                  in
                  determining the fair market value.

              

      

       

      J.    HOSTILE
        TAKE-OVER shall mean:

       

      (i)    the
        acquisition, directly or indirectly, by any person or related group of persons
        (other than the Corporation or a person that directly or indirectly controls,
        is
        controlled by, or is under common control with, the Corporation) of beneficial
        ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities
        possessing more than fifty percent (50%) of the total combined voting power
        of
        the Corporation's outstanding securities pursuant to a tender or exchange
        offer
        made directly to the Corporation's stockholders which the Board does not
        recommend such stockholders to accept; or

       

      
        
          
          

        

        
          
            APPENDIX

            -2-

          

          
            

          

        

        
          
          

        

      

       

      (ii)    a
        change
        in the composition of the Board over a period of thirty-six (36) consecutive
        months or less such that a majority of the Board members ceases, by reason
        of
        one or more contested elections for Board membership, to be comprised of
        individuals who either: (a) have been Board members continuously since the
        beginning of such period; or (b) have been elected or nominated for election
        as
        Board members during such period by at least a majority of the Board members
        described in clause (a) who were still in office at the time the Board approved
        such election or nomination.

       

      K.    IMMEDIATE
        FAMILY shall mean any child, stepchild, grandchild, parent, stepparent,
        grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law,
        daughter-in-law, brother-in-law, or sister-in-law, and shall include adoptive
        relationships.

       

      L.    INCENTIVE
        OPTION shall mean an option which satisfies the requirements of Code Section
        422.

       

      M.    INVOLUNTARY
        TERMINATION shall mean the termination of the Service of any individual which
        occurs by reason of:

       

      (i)    such
        individual's involuntary dismissal or discharge by the Corporation for reasons
        other than Misconduct, or

       

      (ii)    such
        individual's voluntary resignation following (A) a change in his or her position
        with the Corporation which materially reduces his or her level of responsibility
        or the level of management to which Optionee reports, (B) a reduction in
        his or
        her level of compensation (including base salary, fringe benefits and
        participation in any corporate-performance based bonus or incentive programs)
        by
        more than fifteen percent (15%) or (C) a relocation of such individual's
        place
        of employment by more than fifty (50) miles, provided and only if such change,
        reduction or relocation is effected by the Corporation without the individual's
        consent.

       

      N.    MISCONDUCT
        shall mean the commission of any act of fraud, embezzlement or dishonesty
        by the
        Optionee or Participant, any unauthorized use or disclosure by such person
        of
        confidential information or trade secrets of the Corporation (or any Parent
        or
        Subsidiary), or any other intentional misconduct by such person adversely
        affecting the business or affairs of the Corporation (or any Parent or
        Subsidiary) in a material manner. The foregoing definition shall not be deemed
        to be inclusive of all the acts or omissions which the Corporation (or any
        Parent or Subsidiary) may consider as grounds for the dismissal or discharge
        of
        any Optionee, Participant or other person in the Service of the Corporation
        (or
        any Parent or Subsidiary).

       

      O.    1934
        ACT
        shall mean the Securities Exchange Act of 1934, as amended.

       

      P.    NON-STATUTORY
        OPTION shall mean an option not intended to satisfy the requirements of Code
        Section 422.

       

      Q.    OFFICER
        shall mean any person serving as the president, chief executive officer,
        chief
        financial officer, chief operating officer, treasurer, secretary or in any
        other
        managerial or administrative capacity for the Corporation or a Parent or
        Subsidiary of the Corporation, as determined in the Administrator's
        discretion.

       

      R.    OPTION
        COMMITTEE shall mean the committee of two (2) or more non-employee Board
        members
        appointed by the Board to administer the Discretionary Option Grant and Stock
        Issuance Programs.

       

      S.    OPTIONEE
        shall mean any person to whom an option is granted under the Discretionary
        Option Grant Program.

       

      
        
          
          

        

        
          
            APPENDIX

            -3-

          

          
            

          

        

        
          
          

        

      

       

      T.    OPTION
        SURRENDER VALUE shall mean the Fair Market Value per share of Common Stock
        on
        the date the option is surrendered to the Corporation or, in the event of
        a
        Hostile Take-Over, effected through a tender offer, the highest reported
        price
        per share of Common Stock paid by the tender offer or in effecting such Hostile
        Take-Over, if greater. However, if the surrendered option is an Incentive
        Option, the Option Surrender Value shall not exceed the Fair Market Value
        per
        share.

       

      U.    PARENT
        shall mean any corporation (other than the Corporation) in an unbroken chain
        of
        corporations ending with the Corporation, provided each corporation in the
        unbroken chain (other than the Corporation) 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.

       

      V.    PARTICIPANT
        shall mean any person who is issued shares of Common Stock under the Stock
        Issuance Program.

       

      W.    PLAN
        shall mean the Corporation's Amended and Restated 2005 Stock Incentive Plan,
        as
        set forth in this document.

       

      X.    PLAN
        ADMINISTRATOR shall mean the particular entity, whether the Option Committee
        or
        the Board, which is authorized to administer the Discretionary Option Grant
        and
        Stock Issuance Programs with respect to one or more classes of eligible persons,
        to the extent such entity is carrying out its administrative functions under
        those programs with respect to the persons under its jurisdiction.

       

      Y.    PLAN
        EFFECTIVE DATE shall mean the date on which the Plan was adopted by the
        Board.

       

      Z.    SECTION
        16 INSIDER shall mean an officer or director of the Corporation subject to
        the
        short-swing profit liabilities of Section 16 of the 1934 Act.

       

      AA.    SERVICE
        shall mean the performance of services for the Corporation (or any Parent
        or
        Subsidiary) by a person in the capacity of an Employee, Officer, member of
        the
        board of directors or a consultant or independent advisor, except to the
        extent
        otherwise specifically provided in the documents evidencing the option grant
        or
        stock issuance.

       

      BB.    SHORT
        TERM FEDERAL RATE shall mean the federal short-term rate in effect under
        Section
        1274(d) of the Code for the period the shares were held in escrow.

       

      CC.    STOCK
        ISSUANCE AGREEMENT shall mean the agreement entered into by the Corporation
        and
        the Participant at the time of issuance of shares of Common Stock under the
        Stock Issuance Program.

       

      DD.    STOCK
        ISSUANCE PROGRAM shall mean the stock issuance program in effect under the
        Plan.

       

      EE.    SUBSIDIARY
        shall mean any corporation (other than the Corporation) in an unbroken chain
        of
        corporations beginning with the Corporation, 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.

       

      FF.    TAXES
        shall mean the Federal, state and local income and employment tax liabilities
        incurred by the holder of options or unvested shares of Common Stock in
        connection with the exercise of those options or the vesting of those
        shares.

       

      GG.    10%
        STOCKHOLDER shall mean the owner of stock (as determined under Code Section
        424(d)) possessing more than ten percent (10%) of the total combined voting
        power of all classes of stock of the Corporation (or any Parent or
        Subsidiary).

       

      
        
          
          

        

          
            APPENDIX

            -4-EX 10.5

    EXHIBIT
      10.5

    

    POSITRON
      CORPORATION

     

    NOTICE
      OF GRANT OF STOCK OPTION 

     

    Notice
      is
      hereby given of the following stock option grant (the "Option") to purchase
      shares (the "Option Shares") of Common Stock of Positron Corporation, a Texas
      corporation (the "Corporation"):

    
      	 	 	 
	
              Option
                Number:

            	
              [Option
                #]

            	 
	 	 	 
	
              Optionee:

            	
              [Optionee]

            	 
	 	 	 
	
              Grant
                Date:

            	
              [Grant
                Date]

            	 
	 	 	 
	
              Number
                of Option Shares:

            	
              [#
                Shares]

            	 
	 	 	 
	
              Date
                Exercisable:

            	
              [Immediately
                Exercisable] 

            	 
	 	 	 
	
              Expiration
                Date:

            	
              [Expiration
                Date]

            	 
	 	 	 
	
              Exercise
                Price:

            	
              $[EXERCISE
                PRICE]
                per share

            	 
	 	 	 
	
              Type
                of Option:

            	
              o  Incentive
                Stock Option

            	
              o  Non-Statutory
                Stock Option

            
	 	 	 
	
              Vesting
                Schedule:

            	
              This
                option may be exercised in whole or in part, in accordance with the
                following vesting schedule:

            

    

     

    
      	
              Date
                of Vesting

            	 	
              Number
                of Shares

            	 	
              Total
                Vested

            
	
              [Grant
                Date]

            	 	
              [shares]

            	 	
              [shares]

            

    

     

    In
      no
      event shall the Option become exercisable for any additional Option Shares
      after
      Optionee's cessation of Service.

     

    The
      Optionee understands and agrees that the Option is granted subject to and in
      accordance with the terms of the Amended and Restated Positron Corporation
      2005
      Stock Incentive Plan (the "Plan"). The Optionee further agrees to be bound
      by
      the terms of the Plan and the terms of the Option as set forth in the Stock
      Option Agreement attached hereto as Exhibit A (the "Stock Option
      Agreement"). Optionee hereby acknowledges receipt of a copy of the official
      prospectus for the Plan in the form attached hereto as Exhibit B. A copy of
      the Plan is available upon request made to the Corporate Secretary at the
      Corporation's principal offices.

     

    No
      Employment or Service Contract.
      Nothing
      in this Notice or in the attached Stock Option Agreement or in the Plan shall
      confer upon the Optionee any right to continue in Service for any period of
      specific duration or interfere with or otherwise restrict in any way the rights
      of the Corporation (or any Parent or Subsidiary employing or retaining the
      Optionee) or of the Optionee, which rights are hereby expressly reserved by
      each, to terminate Optionee's Service at any time for any reason whatsoever,
      with or without cause.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Definitions.
      All
      capitalized terms in this Notice shall have the meanings assigned to them in
      this Notice or in the attached Stock Option Agreement. 

    
      	 
	
              If
                the spousal consent below is not signed, the Optionee represents
                and
                warrants that he or she is not
                married.

            

    

     

    
      	Dated:
              _______________, 200__	 
	 	 
	POSITRON
              CORPORATION,	 
	a
              Texas corporation	 
	 	 
	 	 
	
              By:

              
                

              

              Name:

              Its:

               

            	
              
                

              

              Name: 
                [OPTIONEE]

              Address:___________________________________

                             
                ___________________________________

                             
                ___________________________________

            
	 
	 
	
              By
                his or her signature below, the spouse of the Optionee acknowledges
                that
                he or she has read the Stock Option Agreement and the Plan and is
                familiar
                with the terms and provisions thereof, and agrees to be bound by
                all the
                terms and conditions of said Agreement and said
                Plan.

            

    

     

    
      	   
	 	    

	
              Spouse

            	 	
              Date

            

    

     

    ATTACHMENTS

     

    EXHIBIT
      A
      - STOCK OPTION AGREEMENT

    EXHIBIT
      B
      - PLAN SUMMARY AND PROSPECTUS

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}]]