Document:

EXHIBIT
        10.3

    

     

    

      SECURITY
        AGREEMENT

      ($400,000
        Aggregate Principal Notes)

       

      This
        Security Agreement (this "Agreement")
        is
        made as of June 27, 2005 by and between Positron Corporation, a Texas
        corporation (the "Debtor"),
        in
        favor of Solaris Opportunity Fund, L.P., its successors and assigns (the
        "Secured
        Party").

       

      R
        E C I
        T A L S :

       

      WHEREAS,
        the Debtor and Secured Party are parties to that certain Note Purchase Agreement
        dated June 27, 2005, wherein Secured Party agreed to purchase and Debtor
        agreed
        to sell Secured Convertible Promissory Notes in the aggregate principal amount
        of $400,000 (the "Note");

       

      WHEREAS,
        the Debtor and Secured Party desire to enter into this Agreement pursuant
        to
        which the Debtor grants to Secured Party a security interest in the Collateral
        (as that term is hereinafter defined) to secure the payment and performance
        by
        the Debtor of its obligations under the Notes;

       

      NOW,
        THEREFORE, in consideration of the purchase of the Note by the Secured Party
        and
        for other good and valuable consideration, the Debtor hereby agrees with
        the
        Secured Party as follows:

       

      A
        G R E
        E M E N T :

       

      1.   Grant
        of Security Interest.

       

      (a)   To
        secure
        the Debtor's full and timely performance of all of the Debtor's indebtedness,
        liabilities and other obligations to the Secured Party pursuant to this
        Agreement and the Notes (including, without limitation, Debtor's obligation
        to
        timely pay the principal amount of the Notes, all interest accrued thereon,
        all
        fees and all other amounts payable by Debtor to the Secured Party thereunder
        or
        in connection therewith, whether now existing or hereafter arising, and whether
        due or to become due, absolute or contingent, liquidated or unliquidated,
        determined or undetermined) (the "Obligations"),
        the
        Debtor hereby pledges, assigns, transfers, hypothecates and sets over to
        the
        Secured Party, and hereby grants to the Secured Party a security interest
        (the
        "Security
        Interest")
        in,
        all of Debtor's right, title and interest in, to and under the property
        described on Exhibit A
        hereto,
        wherever located and whether now existing or owned or hereafter acquired
        or
        arising (the "Collateral"),
        until
        such Obligations are paid in full. The Security Interest shall be subordinated
        to (a) the security interest securing Debtor's indebtedness owed to IMAGIN
        Diagnostic Centers, Inc. ("Senior
        Lender")
        under
        those certain Security Agreements between the Debtor and Senior Lender dated
        May 21, 2004, as the same may be extended, renewed, amended or otherwise
        modified (the "IMAGIN
        Facilities"),
        and
        (b) the security interest occurring Debtor's indebtedness owed to Secured
        party,
        or its transferee under those certain Security Agreements between the Debtor
        and
        Secured Party, or its transferee dated February 28, 2005, as the same may
        be
        extended, renewed, amended or otherwise modified (the "Solaris
        I Facilities").

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      (b)   Anything
        herein to the contrary notwithstanding, (i) Debtor shall remain liable
        under any contracts, agreements and other documents included in the Collateral,
        to the extent set forth therein, to perform all of its duties and obligations
        thereunder to the same extent as if this Agreement had not been executed,
        (ii) the exercise by Secured Party of any of the rights hereunder
        shall not
        release Debtor from any of its duties or obligations under such contracts,
        agreements and other documents included in the Collateral, and
        (iii) Secured Party shall not have any obligation or liability under
        any
        contracts, agreements and other documents included in the Collateral by reason
        of this Agreement, nor shall Secured Party be obligated to perform any of
        the
        obligations or duties of Debtor thereunder or to take any action to collect
        or
        enforce any such contract, agreement or other document included in the
        Collateral hereunder; provided, however, that Secured Party may perform such
        obligations or duties of Debtor if such have not been timely performed by
        Debtor, and if Secured Party performs such obligations or duties, Debtor
        shall
        pay to Secured Party on demand all reasonable expenses incurred by Secured
        Party
        in connection with such performance, and such obligation shall constitute
        Obligations secured by this Agreement.

       

      (c)   This
        Agreement shall create a continuing security interest in the
        Collateral.

       

      2.   Representations
        and Warranties.
        Debtor
        represents and warrants to the Secured Party that:

       

      (a)   Debtor's
        chief executive office and principal place of business is located at the
        address
        set forth in Schedule 1;
        Debtor's jurisdiction of organization is set forth in Schedule 1;
        Debtor's exact legal name is as set forth in the first paragraph of this
        Agreement; all other locations where Debtor conducts business or Collateral
        is
        kept are set forth in Schedule 1;
        and all
        trade names and fictitious names under which Debtor at any time in the past
        has
        conducted or presently conducts its business operations are set forth in
        Schedule 1.

       

      (b)   Other
        than Permitted Liens, Debtor is the sole and complete owner of the Collateral,
        free from any mortgage, deed of trust, pledge, security interest, assignment,
        deposit arrangement, charge or encumbrance, lien, or other type of preferential
        arrangement (a "Lien"),
        and
        (ii) Debtor's grant of a security interest in the Collateral under this
        Agreement, upon filing of the financing statement(s) in the office(s) of
        the
        Texas Secretary of State creates a perfected security interest in the
        Collateral.

       

      (c)   For
        the
        purpose of this Agreement "Permitted
        Liens"
        mean
        the following:

       

      (i)   the
        security interests granted pursuant to this Agreement;

       

      (ii)   the
        IMAGIN Facilities;

       

      (iii)   the
        Solaris I Facilities;

       

      (iv)   liens
        for
        taxes assessments or governmental charges or claims (a) for amounts not yet
        overdue or (b) for amounts that are overdue and that (in the case of any
        such
        amounts overdue for a period in excess of five days) are being contested
        in good
        faith by appropriate proceedings, so long as (A) such reserves or other
        appropriate provisions, if any, as shall be required by generally accepted
        accounting principles (GAAP) shall have been made for any such contested
        amounts
        and (B) in the case of a lien with respect to any portion of the Collateral,
        such contest proceedings conclusively operate to stay the sale of any portion
        of
        the Collateral on account of such lien;

       

      
        
          
          

        

        
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      (v)   liens
        incurred or deposits made in the ordinary course of business in connection
        with
        workers' compensation, unemployment insurance and other types of social security
        or to secure the performance of tenders, statutory obligations, bids, leases,
        government contracts, trade contracts, performance and return-of-money bonds
        and
        other similar obligations (exclusive of obligations for the payment of borrowed
        money), so long as no foreclosure, sale or similar proceedings have been
        commenced with respect to any portion of the Collateral on account
        thereof;

       

      (vi)  any
        attachment or judgment lien not constituting an Event of Default;

       

      (vii)  leases
        or
        subleases granted to third parties and not interfering in any material respect
        with the ordinary conduct of the business of Debtor or any of its subsidiaries;
        

       

      (viii)  liens
        arising from filing UCC financing statements relating solely to equipment
        leases; and

       

      (ix)  
          liens
        in
        favor of customs and revenue authorities arising as a matter of law to secure
        payment of customs duties in connection with the importation of
        goods.

       

      "UCC"
        shall mean the Uniform Commercial Code, as in effect from time to time, of
        the
        State of Texas or of any other state the laws of which are required as a
        result
        thereof to be applied in connection with the issue of perfection of security
        interests.

       

      3.   Covenants.
        From
        and after the date of this Agreement until the Obligations are paid in
        full:

       

      (a)   Limitations
        on Liens.
        With
        the exception of Permitted Liens, the Debtor will not create, incur or permit
        to
        exist, will defend the Collateral against, and will take such other action
        as is
        necessary to remove, any lien or claim on or to the Collateral. The Debtor
        shall
        do and perform all reasonable acts that may be necessary and appropriate
        to
        maintain, preserve and protect the Collateral, and will defend the right,
        title
        and interest of the Secured Party in and to any of the Collateral against
        the
        claims and demands of all other persons. With the exception of financing
        statements filed in connection with Permitted Liens, no financing statements
        or
        other notices of security interests covering any Collateral or any proceeds
        thereof are currently on file in any public office and the Debtor shall not
        authorize any party (other than the Secured Party) to file a financing statement
        in any public office before the Obligations are paid in full.

       

      (b)   Financing
        Statements, Etc.
        Debtor
        shall execute and deliver to the Secured Party upon the request of the Secured
        Party as soon as possible after the closing of the transactions contemplated
        hereby and Debtor hereby authorizes the Secured Party to file (with or without
        Debtor's signature), at any time and from time to time thereafter, all financing
        statements, assignments, continuation financing statements, termination
        statements, account control agreements, and other documents and instruments,
        including but not limited to filings with the relevant patent, trademark
        and
        copyright authorities in connection with notice of the Secured Party's interest
        in the Company's intellectual property and rights, in form reasonably
        satisfactory to the Secured Party, and take all other action, as Secured
        Party
        may reasonably request, to perfect and continue perfected, maintain the priority
        of or provide notice of the security interest of Secured Party in the Collateral
        and to accomplish the purposes of this Agreement. Debtor will cooperate with
        Secured Party in obtaining control (as defined in the Uniform Commercial
        Code,
        as enacted in the State of Texas and amended from time to time (the
        "Code"))
        of
        Collateral consisting of deposit accounts, investment property, letter of
        credit
        rights and electronic chatter paper. Debtor will join with Secured Party
        in
        notifying any third party who has possession of any Collateral of Secured
        Party's security interest therein and obtaining an acknowledgment from the
        third
        party that is holding the Collateral for the benefit of Secured Party. Debtor
        will not create any chattel paper without placing a legend on the chattel
        paper
        acceptable to Secured Party indicating that Secured Party has a security
        interest in the chattel paper. 

       

      
        
          
          

        

        
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      (c)   Indemnification.
        The
        Debtor will defend, indemnify and hold harmless the Secured Party against
        any
        and all liabilities, costs and expenses (including, without limitation, legal
        fees and expenses): (i) with respect to, or resulting from, any delay
        in
        paying, any and all excise, sales or other taxes which may be payable or
        determined to be payable with respect to any of the Collateral, (ii) with
        respect to, or resulting from, any delay in complying with any law, rule,
        regulation or order of any governmental authority applicable to any of the
        Collateral or (iii) in connection with any of the transactions contemplated
        by this Agreement.

       

      (d)   Maintenance
        of Records.
        The
        Debtor will keep and maintain, at its own expense, complete and satisfactory
        records of the Collateral.

       

      (e)   Inspection
        Rights.
        The
        Secured Party shall have full access during normal business hours, and upon
        reasonable prior notice, to all the books, correspondence and other records
        of
        the Debtor relating to the Collateral. The Secured Party or its representatives
        may examine such records and make photocopies or otherwise take extracts
        from
        such records. The Debtor shall render to the Secured Party, at the Debtor's
        expense, such clerical and other assistance as may be reasonably requested
        with
        regard to the exercise of its rights pursuant to this paragraph.

       

      (f)   Compliance
        with Laws.
        The
        Debtor will comply in all material respects with all laws, rules, regulations
        and orders of any governmental authority applicable to any part of the
        Collateral or to the operation of the Debtor's business; provided, however,
        that
        the Debtor may contest any such law, rule, regulation or order in any reasonable
        manner which does not, in the reasonable opinion of the Debtor, adversely
        affect
        the Secured Party's rights or the priority of its liens on the
        Collateral.

       

      (g)   Payment
        of Obligations.
        The
        Debtor will pay promptly when due all taxes, assessments and governmental
        charges or levies imposed upon the Collateral or with respect to any of its
        income or profits derived from the Collateral, as well as all claims of any
        kind
        (including, without limitation, claims for labor, materials and supplies)
        against or with respect to the Collateral, except that no such charge need
        be
        paid if (i) the validity of such charge is being contested in good
        faith by
        appropriate proceedings, (ii) such proceedings do not involve any
        material
        danger of the sale, forfeiture or loss of any of the Collateral or any interest
        in the Collateral and (iii) such charge is adequately reserved against
        on
        the Debtor's books in accordance with generally accepted accounting
        principles.

       

      
        
          
          

        

        
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      (h)   Limitations
        on Dispositions of Collateral.
        The
        Debtor will not sell, transfer, lease or otherwise dispose of any of the
        Collateral, or attempt, offer or contract to do so, other than in the ordinary
        course of Debtor's business. 

       

      (i)   Change
        of Location.
        Debtor
        shall give prompt written notice to Secured Party (and in any event not later
        than thirty (30) days following any change described below in this subsection)
        of: (i) any change in the location of Debtor's chief executive office
        or
        principal place of business, (ii) any change in the locations set
        forth in
Schedule 1;
        (iii) any change in its name, (iv) any changes in its identity
        or
        structure in any manner which might make any financing statement filed hereunder
        incorrect or misleading; and (v) any change in its jurisdiction of
        organization; provided that Debtor shall not locate any Collateral outside
        of
        the United States nor shall Debtor change its jurisdiction of organization
        to a
        jurisdiction outside of the United States.

       

      (j)   Insurance.
        Debtor
        shall carry and maintain in full force and effect, at its own expense and
        with
        financially sound and reputable insurance companies, insurance with respect
        to
        the Collateral in such amounts, with such deductibles and covering such risks
        as
        is customarily carried by companies engaged in the same or similar businesses
        and owning similar properties in the localities where Debtor operates.

       

      (k)   Corporate
        Existence.
        Debtor
        shall maintain and preserve its corporate existence, its rights to transact
        business and all other rights, franchises and privileges necessary or desirable
        in the normal course of its business and operations and the ownership of
        the
        Collateral, except in connection with any transactions expressly permitted
        by
        the Notes.

       

      (l)   Further
        Identification of Collateral.
        The
        Debtor will furnish to the Secured Party from time to time statements and
        schedules further identifying and describing the Collateral and such other
        reports in connection with the Collateral as the Secured Party may reasonably
        request, all in reasonable detail.

       

      4.   Secured
        Party's Appointment as Attorney-in-Fact.

       

      (a)   Powers.
        The
        Debtor hereby appoints the Secured Party and any officer or agent of the
        Secured
        Party, with full power of substitution, as its attorney-in-fact with full
        irrevocable power and authority in the place of the Debtor and in the name
        of
        the Debtor or their own name, from time to time in the Secured Party's
        discretion so long as an Event of Default has occurred and is continuing,
        for
        the purpose of carrying out the terms of this Agreement, to take any appropriate
        action and to execute any instrument which may be necessary or desirable
        to
        accomplish the purposes of this Agreement. Without limiting the foregoing,
        so
        long as an Event of Default has occurred and is continuing, the Secured Party
        shall have the right, without notice to, or the consent of, the Debtor, to
        do
        any of the following on the Debtor's behalf:

       

      
        
          
          

        

        
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      (i)   to
        pay or
        discharge any taxes or liens levied or placed on or threatened against the
        Collateral;

       

      (ii)   to
        direct
        any party liable for any payment under any of the Collateral to make payment
        of
        any and all amounts due or to become due thereunder directly to the Secured
        Party or as the Secured Party directs;

       

      (iii)   to
        ask
        for or demand, collect, and receive payment of and receipt for, any payments
        due
        or to become due at any time in respect of or arising out of any
        Collateral;

       

      (iv)   to
        commence and prosecute any suits, actions or proceedings at law or in equity
        in
        any court of competent jurisdiction to enforce any right in respect of any
        Collateral;

       

      (v)   to
        defend
        any suit, action or proceeding brought against the Debtor with respect to
        any
        Collateral;

       

      (vi)   to
        settle, compromise or adjust any suit, action or proceeding described in
        subsection (v) above and to give such discharges or releases in connection
        therewith as the Secured Party may deem appropriate;

       

      (vii)   to
        assign
        and/or license any patent right included in the Collateral of Debtor (along
        with
        the goodwill of the business, if any, to which any such patent right pertains),
        throughout the world for such term or terms, on such conditions, and in such
        manner, as the Secured Party shall in its sole discretion determine;
        and

       

      (viii)   generally,
        to sell, transfer, pledge and make any agreement with respect to or otherwise
        deal with any of the Collateral and to take, at the Secured Party's option
        and
        the Debtor's expense, any actions which the Secured Party deems necessary
        to
        protect, preserve or realize upon the Collateral and the Secured Party's
        lien on
        the Collateral and to carry out the intent of this Agreement, in each case
        to
        the same extent as if the Secured Party was the absolute owner of the Collateral
        for all purposes.

       

      The
        Debtor hereby ratifies whatever actions the Secured Party shall lawfully
        do or
        cause to be done in accordance with this Section 4. This power of
        attorney
        shall be a power coupled with an interest and shall be irrevocable.

       

      (b)   No
        Duty on Secured Party's Part.
        The
        powers conferred on the Secured Party by this Section 4 are solely
        to
        protect the Secured Party's interests in the Collateral and shall not impose
        any
        duty upon it to exercise any such powers. The Secured Party and its officers,
        directors, employees or agents shall, in the absence of willful misconduct
        or
        gross negligence, not be responsible to the Debtor for any act or failure
        to act
        pursuant to this Section 4.

       

      5.   Event
        of Default.
        Any of
        the following events which shall occur or be continuing shall constitute
        an
        "Event
        of Default,"
        unless
        otherwise consented to in writing by the Secured Party:

       

      
        
          
          

        

        
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      (a)   Any
        event, constituting an "Event of Default," as such terms are defined in Section
        3 of the Notes.

       

      (b)   Any
        representation or warranty by Debtor under or in connection with this Agreement
        shall prove to have been incorrect in any material respect when made or deemed
        made.

       

      (c)   Debtor
        shall fail to perform or observe in any material respect any other term,
        covenant or agreement contained in this Agreement or the Notes on its part
        to be
        performed or observed and any such failure shall remain unremedied for a
        period
        of 15 days from the date of such failure. 

       

      (d)   Any
        material impairment in the value of the Collateral (other than normal
        depreciation).

       

      (e)   Any
        levy
        upon, seizure or attachment of any of the Collateral.

       

      (f)   Any
        loss,
        theft or substantial damage to, or destruction of, any material portion of
        the
        Collateral (unless within 15 days after the occurrence of any such event,
        Debtor
        furnishes to Secured Party evidence satisfactory to Secured Party that the
        amount of any such loss, theft, damage to or destruction of the Collateral
        is
        fully insured under policies naming Secured Party as an additional named
        insured
        or loss payee).

       

      6.   Performance
        by Secured Party of Debtor's Obligations.
        If the
        Debtor fails to perform or comply with any of its agreements or covenants
        contained in this Agreement and the Secured Party performs or complies, or
        otherwise causes performance or compliance, with such agreement or covenant
        in
        accordance with the terms of this Agreement, then the reasonable expenses
        of the
        Secured Party incurred in connection with such performance or compliance
        shall
        be payable by the Debtor to the Secured Party on demand and shall constitute
        Obligations secured by this Agreement.

       

      7.   Remedies.
        If an
        Event of Default has occurred and is continuing, the Secured Party may exercise,
        in addition to all other rights and remedies granted to it in this Agreement
        and
        in any other instrument or agreement relating to the Obligations, all rights
        and
        remedies of a secured party under the Code or other applicable law. Without
        limiting the foregoing, but in all events subject to the rights of the Senior
        Lender, the Secured Party, without demand of performance or other demand,
        presentment, protest, advertisement or notice of any kind (except any notice
        required by law) to or upon the Debtor or any other person (all of which
        demands, defenses, advertisements and notices are hereby waived), may in
        such
        circumstances collect, receive, appropriate and realize upon any or all of
        the
        Collateral, and/or may sell, lease, assign, give an option or options to
        purchase, or otherwise dispose of and deliver any or all of the Collateral
        (or
        contract to do any of the foregoing), in one or more parcels at a public
        or
        private sale or sales, at any exchange, broker's board or office of Secured
        Party or elsewhere upon such terms and conditions as the Secured Party may
        deem
        advisable, for cash or on credit or for future delivery without assumption
        of
        any credit risk. The Secured Party shall have the right upon any such public
        sale or sales and, to the extent permitted by law, upon any such private
        sale or
        sales, to purchase all or any part of the Collateral so sold, free of any
        right
        or equity of redemption in the Debtor, which right or equity is hereby waived
        or
        released to the extent permitted by law. The Secured Party shall apply the
        net
        proceeds of any such collection, recovery, receipt, appropriation, realization
        or sale, after deducting all reasonable expenses incurred therein or in
        connection with the care or safekeeping of any of the Collateral or in any
        way
        relating to the Collateral or the rights of the Secured Party under this
        Agreement (including, without limitation, reasonable attorneys' fees and
        expenses) to the payment in whole or in part of the Obligations, and only
        after
        such application and after the payment by the Secured Party of any other
        amount
        required by any provision of law, need the Secured Party account for the
        surplus, if any, to the Debtor. To the extent permitted by applicable law,
        the
        Debtor waives all claims, damages and demands it may acquire against the
        Secured
        Party arising out of the exercise by the Secured Party of any of its rights
        hereunder. If any notice of a proposed sale or other disposition of Collateral
        shall be required by law, such notice shall be deemed reasonable and proper
        if
        given at least five (5) days before such sale or other disposition. The Debtor
        shall remain liable for any deficiency if the proceeds of any sale or other
        disposition of the Collateral are insufficient to pay the Obligations and
        the
        fees and disbursements of any attorneys employed by the Secured Party to
        collect
        such deficiency.

       

      
        
          
          

        

        
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      8.   Limitation
        on Duties Regarding Preservation of Collateral.
        The
        sole duty of the Secured Party with respect to the custody, safekeeping and
        preservation of the Collateral, under the Code or otherwise, shall be to
        deal
        with it in the same manner as such Secured Party deals with similar property
        for
        its own account. Neither the Secured Party nor any of its directors, officers,
        employees or agents shall be liable for failure to demand, collect or realize
        upon all or any part of the Collateral or for any delay in doing so or shall
        be
        under any obligation to sell or otherwise dispose of any Collateral upon
        the
        request of the Debtor or otherwise.

       

      9.   Powers
        Coupled with an Interest.
        All
        authorizations and agencies contained in this Agreement with respect the
        Collateral are irrevocable and powers coupled with an interest.

       

      10.   No
        Waiver; Cumulative Remedies.
        The
        Secured Party shall not by any act (except by a written instrument pursuant
        to
        Section 11(a) hereof), delay, indulgence, omission or otherwise be
        deemed
        to have waived any right or remedy hereunder or to have acquiesced in any
        default under the Notes or in any breach of any of the terms and conditions
        of
        this Agreement. No failure to exercise, nor any delay in exercising, on the
        part
        of the Secured Party, any right, power or privilege hereunder shall operate
        as a
        waiver thereof. No single or partial exercise of any right, power or privilege
        hereunder shall preclude any other or further exercise thereof or the exercise
        of any other right, power or privilege. A waiver by the Secured Party of
        any
        right or remedy under this Agreement on any one occasion shall not be construed
        as a bar to any right or remedy which the Secured Party would otherwise have
        on
        any subsequent occasion. The rights and remedies provided in this Agreement
        are
        cumulative, may be exercised singly or concurrently and are not exclusive
        of any
        rights or remedies provided by law.

       

      11.   Miscellaneous.

       

      (a)   Amendments
        and Waivers.
        Any
        term of this Agreement may be amended with the written consent of the Debtor
        and
        Secured Party. Any amendment or waiver effected in accordance with this
        Section 11(a) shall be binding upon the parties and their respective
        successors and assigns.

       

      
        
          
          

        

        
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      (b)   Transfer;
        Successors and Assigns.
        The
        terms and conditions of this Agreement shall be binding upon the Debtor and
        its
        successors and assigns and inure to the benefit of the Secured Party and
        its
        successors and assigns. Nothing in this Agreement, express or implied, is
        intended to confer upon any party other than the parties hereto or their
        respective successors and assigns any rights, remedies, obligations or
        liabilities under or by reason of this Agreement, except as expressly provided
        in this Agreement.

       

      (c)   Governing
        Law.
        This
        Agreement and all acts and transactions pursuant hereto and the rights and
        obligations of the parties hereto shall be governed, construed and interpreted
        in accordance with the laws of the State of Texas, without giving effect
        to
        principles of conflicts of law.

       

      (d)   Counterparts;
        Facsimile Signatures.
        This
        Agreement may be executed in two or more counterparts, each of which shall
        be
        deemed an original and all of which together shall constitute one instrument.
        This Agreement may be executed by facsimile signatures.

       

      (e)   Titles
        and Subtitles.
        The
        titles and subtitles used in this Agreement are used for convenience only
        and
        are not to be considered in construing or interpreting this
        Agreement.

       

      (f)   Notices.
        Any
        notice required or permitted by this Agreement shall be in writing and shall
        be
        deemed sufficient upon receipt, when delivered personally or by courier,
        overnight delivery service or confirmed facsimile, or forty-eight (48) hours
        after being deposited in the U.S. mail as certified or registered mail with
        postage prepaid (airmail if sent internationally), if such notice is addressed
        to the party to be notified at such party's address or facsimile number as
        set
        forth below, or as subsequently modified by written notice.

       

      (g)   Severability.
        If one
        or more provisions of this Agreement are held to be unenforceable under
        applicable law, the parties agree to renegotiate such provision in good faith,
        in order to maintain the economic position enjoyed by each party as close
        as
        possible to that under the provision rendered unenforceable. In the event
        that
        the parties cannot reach a mutually agreeable and enforceable replacement
        for
        such provision, then (i) such provision shall be excluded from this
        Agreement, (ii) the balance of the Agreement shall be interpreted
        as if
        such provision were so excluded and (iii) the balance of the Agreement
        shall be enforceable in accordance with its terms.

       

      (h)   Entire
        Agreement.
        This
        Agreement, and the documents referred to herein constitute the entire agreement
        between the parties hereto pertaining to the subject matter hereof, and any
        and
        all other written or oral agreements existing between the parties hereto
        concerning such subject matter are expressly canceled.

       

      (i)   Code
        Definitions.
        All
        terms defined in the Code and as used herein shall have the same definitions
        herein as specified therein; provided, however, that the term "instrument"
        shall
        be such term as defined in Article 9 of the Code rather than Article 3 of
        the
        Code.

       

      The
        Debtor and Secured Party have caused this Agreement to be duly executed and
        delivered as of the date first above written.

       

      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

         

        
          	 	 	 
	 	DEBTOR: 
	 	 
	 	POSITRON
                  CORPORATION
	 
 	 
 	 
 
	 	By:  	 
	 	
                  
Name:
                  ______________________________________________
	 	Its:
                  ________________________________________________
	 	 
	 	
                  Address:  1304
                    Langham Creek Drive #300

                         
                    Houston, Texas 77084

                         
                    Facsimile: 281-492-2961

                

        

         

      

      
        	 	 	 
	 	SECURED
                PARTY: 
	 	 
	 	SOLARIS
                OPPORTUNITY FUND, L.P.
	 
 	 
 	 
 
	 	By:  	 
	 	
                
Name:
                _______________________________________________
	 	Its:
                _________________________________________________
	 	 
	 	
                Address:   700
                  Commerce Drive

                        Oak
                  Brook,
                  Illinois 60523

                        Facsimile:
                  _____________

              

      

       

       

      
        
          
          

        

        
          -10-

          
            

          

        

        
          
          

        

      

      EXHIBIT
        A

       

       

      The
        Collateral shall consist of all right, title and interest of Debtor in all
        of
        its assets, including but not limited to the following:

       

      (i)   all
        accounts, accounts receivable, contract rights, rights to payment, chattel
        paper, electronic chattel paper, commercial tort claims, letter of credit
        rights
        and proceeds of letters of credit, documents, securities, money and instruments,
        and investment property, whether held directly or through a securities
        intermediary, and other obligations of any kind owed to Debtor, however
        evidenced;

       

      (ii)   all
        deposits and deposit accounts with any bank, savings and loan association,
        credit union or like organization, and all funds and amounts therein, and
        whether or not held in trust, or in custody or safekeeping, or otherwise
        restricted or designated for a particular purpose;

       

      (iii)   all
        inventory, including, without limitation, all materials, raw materials, parts,
        components, work in progress, finished goods, merchandise, supplies, and
        all
        other goods which are held for sale, lease or other disposition or furnished
        under contracts of service or consumed in Debtor's business, including, without
        limitation, those held for display or demonstration or out on lease or
        consignment;

       

      (iv)   all
        equipment, including, without limitation, all machinery, furniture, furnishings,
        fixtures, trade fixtures, tools, parts and supplies, automobiles, trucks,
        tractors and other vehicles, appliances, computer and other electronic data
        processing equipment and other office equipment, computer programs and related
        data processing software, and all additions substitutions, replacements,
        parts,
        accessories, and accessions to and for the foregoing;

       

      (v)   all
        general intangibles and other personal property of Debtor, including, without
        limitation, (A) all tax and other refunds, rebates or credits of every
        kind
        and nature to which Debtor is now or hereafter may become entitled; (B) all
        intellectual property and all worldwide rights and interests therein of any
        type
        or description, including, without limitation, all inventions and discoveries,
        patents and patent applications, copyrights and applications for copyright
        (together with the underlying works of authorship) whether or not registered,
        together with any renewals and extensions thereof, trademarks, service marks
        and
        trade names, and applications for registration of such trademarks, service
        marks
        and trade names, domain names, trade secrets, trade dress, trade styles,
        logos,
        other source of business identifiers, mask-works, mask-work registrations,
        mask-work applications, software, confidential and proprietary information,
        customer lists, other license rights, advertising materials, operating manuals,
        methods, processes, know-how, algorithms, formulae, databases, quality control
        procedures, product, service and technical specifications, operating, production
        and quality control manuals, sales literature, drawings, specifications,
        blue
        prints, descriptions, inventions, name plates and catalogs, and the entire
        goodwill of or associated with the businesses now or hereafter conducted
        by
        Debtor connected with and symbolized by any of the aforementioned properties
        and
        assets, and all licenses relating to any of the foregoing, all reissuance,
        continuations and continuations-in-part of the foregoing, all other rights
        derived from or associated with the foregoing, including the right to sue
        and
        recover for past infringement, and all income and royalties with respect
        thereto; (C) all good will, choses in action and causes of action;
        (D) all
        interests in limited and general partnerships and limited liability companies;
        and (E) all indemnity agreements, guaranties, insurance policies, insurance
        claims, and other contractual, equitable and legal rights of whatever kind
        or
        nature;

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      (vi)   all
        books, records and other written, electronic or other documentation in whatever
        form maintained by or for Debtor in connection with the ownership of its
        assets
        or the conduct of its business or evidencing or containing information relating
        to the Collateral; and

       

      (vii)   all
        products and proceeds, including insurance proceeds, and supporting obligations
        of any and all of the foregoing.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      SCHEDULE 1

       

       

      Business
        Address: 1304
        Langham Creek Drive #300, Houston, Texas 77084

       

      Incorporated: Texas

       

      Other
        Places of Business:  N/A   

       

      Other
        Business Names:  N/AEXHIBIT
        10.4

    

     

     

    
      REGISTRATION
        RIGHTS AGREEMENT

       

      This
        Registration Rights Agreement (this "Agreement")
        is
        made and entered into as of June 27, 2005 by and between Solaris Opportunity
        Fund, L.P. ("Purchaser"),
        and
        Positron Corporation, a Texas corporation (the "Company").

       

      R
        E C
        I T A L S :

       

      WHEREAS,
        concurrent with the execution of this Agreement the Company and Purchaser
        are
        entering into a Note Purchase Agreement (as defined below) pursuant to which
        Purchaser will purchase from the Company Secured Convertible Promissory Notes
        in
        the aggregate principal amount of $400,000 (the "Notes");
        and

       

      WHEREAS,
        the Notes are convertible at the option of the holders into shares of the
        Company's Series F Preferred Stock, $1.00 par value (the "Series
        F Preferred Stock"),
        which
        shares are in turn convertible into shares of the Company's Common Stock
        (the
        "Common Stock").

       

      NOW,
        THEREFORE, in consideration of the mutual promises, representations, warranties
        and conditions set forth in this Agreement, the parties hereto, intending
        to be
        legally bound, hereby agree as follows:

       

      A
        G
        R
        E
        E
        M
        E
        N
        T
        :

       

      1.   Definitions.
        For
        purposes of this Agreement, in addition to the definitions set forth above
        and
        elsewhere herein, the following terms shall have the following respective
        meanings:

       

      "Acquisition
        Shares"
        shall
        mean the shares of Common Stock which the Purchaser will have a right to
        acquire
        upon the conversion of the Series F Preferred Stock.

       

      "Commission"
        shall
        mean the United States Securities and Exchange Commission and any successor
        agency.

       

      "Demand
        Date"
        shall
        mean the date the Company receives the written request for registration of
        Registrable Stock from Purchaser pursuant to Section 3 hereof.

       

      "Exchange
        Act"
        shall
        mean the Securities Exchange Act of 1934, as amended, or any similar federal
        statute, and the rules and regulations of the Commission thereunder, all
        as the
        same shall be in effect at the time.

       

      "Holder"
        shall
        mean the Purchaser and all transferees or assignees thereof to whom the rights
        under this Agreement are assigned in accordance with the provisions of
        Section 8 hereof.

       

      "Note
        Purchase Agreement"
        shall
        mean the Note Purchase Agreement between the Company and the Purchaser, dated
        June 20, 2005.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      "Person"
        shall
        mean an individual, corporation, partnership, limited partnership, syndicate,
        person (including, without limitation, a "person" as defined in
        Section 13(d)(3) of the Exchange Act), trust, association or entity
        or
        government, political subdivision, agency or instrumentality of a
        government.

       

      "Register,"
        "registered"
        and
        "registration"
        shall
        refer to a registration effected by preparing and filing a registration
        statement or similar document in compliance with the Securities Act and the
        declaration or ordering of effectiveness of such registration statement or
        document.

       

      "Registrable
        Stock"
        shall
        mean (a) the Acquisition Shares, (b) any shares of Common Stock
        or
        other capital stock issued as a dividend, or other distribution with respect
        to,
        or in exchange for, or in replacement of, any of the Acquisition Shares and
        (c) any shares of capital stock issued by way of a stock split of
        the
        Acquisition Shares referred to in clause (a) above. For purposes of
        this
        Agreement, any Registrable Stock shall cease to be Registrable Stock when
        (i) a registration statement covering such Registrable Stock has been
        declared effective and such Registrable Stock has been disposed of pursuant
        to
        such effective registration statement, (ii) such Registrable Stock
        is sold
        by a person in a transaction in which the rights under the provisions of
        this
        Agreement are not assigned, or (iii) all such Registrable Stock may
        be sold
        by any and all Holders pursuant to Rule 144(k) (or any similar provision
        then in
        force, but not Rule 144A) under the Securities Act without registration
        under the Securities Act.

       

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

       

      2.   Restrictive
        Legend.
        Each
        certificate representing Acquisition Shares shall, except as otherwise provided
        in this Section 2, be stamped or otherwise imprinted with a legend
        substantially in the form set forth in the Note Purchase Agreement. A
        certificate shall not bear such legend if in the opinion of counsel satisfactory
        to the Company or the Company shall determine that the securities being sold
        thereby may be publicly sold without registration under the Securities Act
        or
        the transfer of such securities is permitted under the provisions of Regulation
        D, Rule 144(k) or Rule 144A (or any rule permitting public
        sale
        without registration under the Securities Act).

       

      3.   Registration
        Rights.
        Upon
        the written request of Purchaser to the Company, the Company shall use its
        reasonable best efforts to prepare and file with the Commission a registration
        statement on an applicable form, signed, pursuant to Section 6(a)
        of the
        Securities Act, by the officers and directors of the Company, with respect
        to
        the Registrable Stock. If the Company shall fail to register the shares of
        Registrable Stock, the Company shall deliver the unregistered shares of
        Registrable Stock to the Purchaser and such shares may be sold pursuant to
        and
        subject to the requirements of Rule 144 under the Securities Act. The Company's
        delivery of the unregistered shares shall be the Purchaser's sole remedy
        for any
        failure by the Company to register shares pursuant to this Section 3. In
        connection with this Section 3, the Company shall:

       

      (a)   cause
        such registration statement to become effective on or before the three-month
        anniversary of the Demand Date and to remain effective through and including
        the
        earlier of (i) the time when all of the Registrable Stock has been
        sold
        pursuant to such registration statement or (ii) the time when all
        of the
        Holders of the Registrable Stock can sell all of the Registrable Stock pursuant
        to Rule 144(k) (or any similar provision then in force, but not
        Rule 144A) under the Securities Act without registration under the
        Securities Act.

       

      
        
          
          

        

        
          -2-

          
            

          

        

        
          
          

        

         

      

      (b)   prepare
        and file with the Commission such amendments and supplements to such
        registration statement, signed, pursuant to Section 6(a) of the Securities
        Act, by the officers and directors of the Company, and the prospectus used
        in
        connection therewith as may be necessary to comply with the provisions of
        the
        Securities Act with respect to the disposition of all Registrable Stock covered
        by such registration statement;

       

      (c)   furnish
        to the Holders such numbers of copies of the registration statement and the
        prospectus included therein (including each preliminary prospectus and any
        amendments or supplements thereto) in conformity with the requirements of
        the
        Securities Act and such other documents and information as they may reasonably
        request;

       

      (d)   use
        its
        reasonable best efforts to register or qualify the Registrable Stock covered
        by
        such registration statement under such other securities or blue sky laws
        of such
        jurisdictions within the United States and Puerto Rico as required by law
        for
        the distribution of the Registrable Stock covered by the registration statement;
        provided, however, that the Company shall not be required in connection
        therewith or as a condition thereto to qualify to do business in or to file
        a
        general consent to service of process in any jurisdiction wherein it would
        not
        but for the requirements of this paragraph (d) be obligated to do
        so; and
        provided, further, that the Company shall not be required to qualify such
        Registrable Stock in any jurisdiction in which the securities regulatory
        authority requires that any Holder submit any shares of its Registrable Stock
        to
        the terms, provisions and restrictions of any escrow, lockup or similar
        agreement(s) for consent to sell Registrable Stock in such jurisdiction unless
        such Holder agrees to do so;

       

      (e)   promptly
        notify each Holder for whom such Registrable Stock is covered by such
        registration statement, at any time when a prospectus relating thereto is
        required to be delivered under the Securities Act, of the happening of any
        event
        as a result of which the prospectus included in such registration statement,
        as
        then in effect, includes an untrue statement of a material fact or omits
        to
        state any material fact required to be stated therein or necessary to make
        the
        statements therein not misleading in light of the circumstances under which
        they
        were made, and at the request of any such Holder promptly prepare and furnish
        to
        such Holder a reasonable number of copies of a supplement to or an amendment
        of
        such prospectus as may be necessary so that, as thereafter delivered to Holders
        of such securities, such prospectus shall not include any untrue statement
        of a
        material fact or omit to state a material fact required to be stated therein
        or
        necessary to make the statements therein not misleading in light of the
        circumstances under which they were made;

       

      (f)   enter
        into customary agreements and take such other actions as are reasonably required
        in order to expedite or facilitate the disposition of the Registrable Stock
        to
        be so included in the registration statement;

       

      
        
          
          

        

        
          -3-

          
            

          

        

        
          
          

        

         

      

      (g)   otherwise
        use its reasonable best efforts to comply with all applicable rules and
        regulations of the Commission;

       

      (h)   use
        its
        reasonable best efforts to list the Registrable Stock covered by such
        registration statement with any securities exchange on which Common Stock
        is
        then listed; and

       

      (i)   after
        the
        effectiveness of the registration statement, cooperate with the Holders to
        facilitate the timely preparation and delivery of certificates representing
        the
        Registrable Stock to be sold, which certificates shall not bear any restrictive
        legends other than restrictive legends still required to be imposed by the
        Note
        Purchase Agreement.

       

      4.   Suspension
        of Trading.
        Notwithstanding any other provision of this Agreement, the Company shall
        have
        the right at any time to require that all Holders suspend further open market
        offers and sales of Registrable Stock whenever, and for so long as, in the
        reasonable judgment of the Company in good faith based upon the advice of
        counsel satisfactory to the Holders of a majority of the Registrable Stock,
        there is in existence material undisclosed information or events with respect
        to
        the Company (the "Suspension
        Right")
        such
        that the registration statement would contain any untrue statement of a material
        fact or omit to state any material fact required to be stated therein or
        necessary to make the statements therein not misleading in light of the
        circumstances under which they were made. In the event the Company exercises
        the
        Suspension Right, such suspension will continue for such period of time
        reasonably necessary for disclosure to occur at a time that is not materially
        detrimental to the Company or until such time as the registration statement
        does
        not include any untrue statement of a material fact or omit to state any
        material fact required to be stated therein or necessary to make the statements
        therein not misleading in light of the circumstances under which they were
        made,
        each as determined in good faith by the Company. The Company will promptly
        give
        the Holders notice, in a writing signed by an executive officer of the Company,
        of any exercise of the Suspension Right. The Company agrees to notify the
        Holders promptly upon termination of the Suspension Right. Notwithstanding
        the
        foregoing, under no circumstances shall Holder be entitled to exercise the
        Suspension Right for more than sixty calendar days in any twelve-month
        period.

       

      5.   Furnish
        Information.
        It
        shall be a condition precedent to the obligations of the Company to take
        any
        action pursuant to this Agreement that the Holders shall furnish to the Company
        such information regarding themselves, the Registrable Stock held by them,
        and
        the intended method of disposition of such securities as the Company shall
        reasonably request and as shall be required in connection with the action
        to be
        taken by the Company.

       

      6.   Expenses
        of Registration.
        So long
        as the Company has received at least $700,000 in principal under the Notes,
        all
        expenses incurred in connection with the registration pursuant to this
        Agreement, including without limitation all registration, filing and
        qualification fees, word processing, duplicating, printers' and accounting
        fees
        (including the expenses of any special audits or comfort letters required
        by or
        incident to such performance and compliance), fees of the National Association
        of Securities Dealers, Inc. or listing fees, messenger and delivery expenses,
        all fees and expenses of complying with state securities or blue sky laws,
        reasonable fees and disbursements of counsel for the Company (collectively,
        the
        "Expenses"),
        shall
        be paid by the Company. If the Company has not received at least $700,000
        in
        principal under the Notes and Purchaser has requested registration pursuant
        to
        this Agreement, all Expenses shall be paid by Purchaser. In the event Expenses
        are to be paid by Purchaser, such Expenses shall be prepaid by Purchaser
        to the
        Company upon receipt of a reasonable estimate from the Company (the
        "Expenses
        Estimate").
        To
        extent the Expenses Estimate exceeds actual Expenses, Purchaser shall be
        reimbursed within 30 days of the effective registration of the Registrable
        Stock. To extent the Expenses Estimate is insufficient to cover total actual
        Expenses, Purchaser shall reimburse the Company for such excess within 30
        days
        of receipt of an invoice for such excess Expenses. The parties agree that
        all
        underwriting discounts and commissions shall be the responsibility of the
        Holders.

       

      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

         

      

      7.   Indemnification.

       

      (a)   To
        the
        extent permitted by applicable law, the Company shall indemnify and hold
        harmless each Holder, such Holder's directors and officers, any underwriter
        (as
        defined in the Securities Act), and each person, if any, who controls such
        Holder or underwriter within the meaning of the Securities Act, against any
        losses, claims, damages or liabilities, joint or several, to which they may
        become subject under the Securities Act or any other applicable state or
        federal
        law, insofar as such losses, claims, damages or liabilities (or proceedings
        in
        respect thereof) arise out of or are based on any untrue or alleged untrue
        statement of any material fact contained in such registration statement on
        the
        effective date thereof (including any prospectus filed under Rule 424
        under
        the Securities Act or any amendments or supplements thereto) or arise out
        of or
        are based upon the omission or alleged omission to state therein a material
        fact
        required to be stated therein or necessary to make the statements therein
        not
        misleading, and shall reimburse each such Holder, such Holder's directors
        and
        officers, such underwriter or controlling person for any legal or other expenses
        reasonably incurred by them (but not in excess of expenses incurred in respect
        of one counsel and one local counsel for all of them unless, in the reasonable
        judgment of an indemnified party there is potential conflict of interest
        between
        any indemnified parties, which indemnified parties may be represented by
        separate counsel and local counsel) in connection with investigating or
        defending any such loss, claim, damage, liability or action; provided, however,
        that the indemnity agreement contained in this Section 7(a) shall
        not apply
        to amounts paid in settlement of any such loss, claim, damage, liability
        or
        action if such settlement is effected without the consent of the Company
        (which
        consent shall not be unreasonably withheld); provided, further, that the
        Company
        shall not be liable to any Holder, such Holder's directors and officers,
        underwriter or controlling person in any such case for any such loss, claim,
        damage, liability or action to the extent that it arises out of or is based
        upon
        an untrue statement or alleged untrue statement or omission or alleged omission
        made in connection with such registration statement, preliminary prospectus,
        final prospectus or amendments or supplements thereto, in reliance upon and
        in
        conformity with written information furnished expressly for use in connection
        with such registration by any such Holder, such Holder's directors and officers,
        underwriter or controlling person. Such indemnity shall remain in full force
        and
        effect regardless of any investigation made by or on behalf of any such Holder,
        such Holder's directors and officers, underwriter or controlling person,
        and
        shall survive the transfer of such securities by such Holder.

       

      
        
          
          

        

        
          -5-

          
            

          

        

        
          
          

        

         

      

      (b)   To
        the
        extent permitted by applicable law, each Holder shall indemnify and hold
        harmless the Company, each of its directors and officers, each person, if
        any,
        who controls the Company within the meaning of the Securities Act, and any
        underwriter (within the meaning of the Securities Act) for the Company against
        any losses, claims, damages or liabilities, joint or several, to which the
        Company or any such director, officer, controlling person or underwriter
        may
        become subject, under the Securities Act or any other applicable state or
        federal law, insofar as such losses, claims, damages or liabilities (or
        proceedings in respect thereof) arise out of or are based upon any untrue
        statement or alleged untrue statement of any material fact contained in such
        registration statement on the effective date thereof (including any prospectus
        filed under Rule 424 under the Securities Act or any amendments or
        supplements thereto) or arise out of or are based upon the omission or alleged
        omission to state therein a material fact required to be stated therein or
        necessary to make the statements therein not misleading, in each case to
        the
        extent, but only to the extent, that such untrue statement or alleged untrue
        statement or omission or alleged omission was made in such registration
        statement in reliance upon and in conformity with written information furnished
        expressly by or on behalf of such Holder for use in connection with such
        registration; and each such Holder shall reimburse any legal or other expenses
        reasonably incurred by the Company or any such director, officer, controlling
        person, agent or underwriter (but not in excess of expenses incurred in respect
        of one counsel and one local counsel for all of them unless, in the reasonable
        judgment to of an indemnified party, there is a conflict of interest between
        any
        indemnified parties, which indemnified parties may be represented by separate
        counsel and local counsel) in connection with investigating or defending
        any
        such loss, claim, damage, liability or action; provided, however, that the
        indemnity agreement contained in this Section 7(b) shall not apply
        to
        amounts paid in settlement of any such loss, claim, damage, liability or
        action
        if such settlement is effected without the consent of such Holder (which
        consent
        shall not be unreasonably withheld), and provided, further, that the liability
        of each Holder hereunder shall be limited to the proportion of any such loss,
        claim, damage, liability or expense which is equal to the proportion that
        the
        net proceeds from the sale of the shares sold by such Holder under any such
        registration statement bears to the total net proceeds from the sale of all
        securities sold thereunder, but not in any event to exceed the net proceeds
        received by such Holder from the sale of Registrable Stock covered by such
        registration statement.

       

      (c)   Promptly
        after receipt by an indemnified party under this Section of notice of the
        commencement of any action, such indemnified party shall, if a claim in respect
        thereof is to be made against any indemnifying party under this Section,
        notify
        the indemnifying party in writing of the commencement thereof and the
        indemnifying party shall have the right to participate in and assume the
        defense
        thereof with counsel selected by the indemnifying party and reasonably
        satisfactory to the indemnified party; provided, however, that the exercise
        of
        the foregoing right shall be conditioned upon the written acknowledgment
        of the
        indemnifying party to the indemnified party of the indemnifying party's
        obligation hereunder to indemnify the indemnified party for any losses arising
        from such action; and provided further, that in such event, the indemnified
        party shall have the right to retain its own counsel and local counsel, with
        all
        fees and expenses thereof to be paid by such indemnified party, and to be
        apprised of all progress in any proceeding the defense of which has been
        assumed
        by the indemnifying party. The failure to notify an indemnifying party promptly
        of the commencement of any such action, shall only release the indemnifying
        party from any of its obligations under this Section 7(c) if, and
        only to
        the extent that, such indemnifying party is materially prejudiced by such
        failure, but the omission to so notify the indemnifying party will not relieve
        it of any liability that it may have to any indemnified party otherwise than
        under this Section.

       

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

         

      

      (d)   To
        the
        extent any indemnification by an indemnifying party is prohibited or limited
        by
        law, the indemnifying party, in lieu of indemnifying such indemnified party,
        shall contribute to the amount paid or payable by such indemnified party
        as a
        result of such losses, claims, damages or liabilities in such proportion
        as is
        appropriate to reflect the relative fault of the indemnifying party and
        indemnified party in connection with the actions which resulted in such losses,
        claims, damages or liabilities, as well as any other relevant equitable
        considerations. The relative fault of such indemnifying party and indemnified
        party shall be determined by reference to, among other things, whether any
        action in question, including any untrue or alleged untrue statement of material
        fact or omission or alleged omission to state a material fact, has been made
        by,
        or relates to information supplied by, such indemnifying party or indemnified
        party, and the parties' relative intent, knowledge, access to information
        and
        opportunity to correct or prevent such action. The amount paid or payable
        by a
        party as a result of the losses, claims, damages or liabilities referred
        to
        above shall be deemed to include any legal or other fees or expenses reasonably
        incurred by such party in connection with any investigation or
        proceeding.

       

      The
        parties hereto agree that it would not be just and equitable if contribution
        pursuant to this Section 7(d) were determined by pro rata allocation
        or by
        any other method of allocation which does not take account of the equitable
        considerations referred to in the immediately preceding paragraph. No person
        guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
        of the Securities Act) shall be entitled to contribution from any person
        who was
        not guilty of such fraudulent misrepresentation.

       

      8.   Transfer
        of Registration Rights.
        Subject
        to any transfer restrictions set forth in the Note Purchase Agreement or
        the
        Notes the rights of any Holder under this Agreement with respect to any
        Registrable Stock may be transferred to any transferee of such Registrable
        Stock; provided, however, that (i) the transferring Holder shall give
        the
        Company written notice at or prior to the time of such transfer stating the
        name
        and address of the transferee and identifying the securities with respect
        to
        which the rights under this Agreement are being transferred; (ii) such
        transferee shall agree in writing, in form and substance reasonably satisfactory
        to the Company, to be bound as a Holder by the provisions of this Agreement;
        and
        (iii) immediately following such transfer the further disposition
        of such
        securities by such transferee is restricted under the Securities Act. Except
        as
        set forth in this Section 8, no transfer of Registrable Stock shall
        cause
        such Registrable Stock to lose such status.

       

      9.   Successors
        and Assigns.
        Except
        as otherwise expressly provided herein, the terms and conditions of this
        Agreement shall inure to the benefit of and be binding upon the respective
        successors and assigns of the parties hereto. Except as expressly provided
        in
        this Agreement, nothing in this Agreement, express or implied, is intended
        to
        confer upon any person other than the parties hereto or their respective
        successors and assigns any rights, remedies, obligations, or liabilities
        under
        or by reason of this Agreement.

       

      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

         

      

      10.   Counterparts;
        Titles.
        This
        Agreement may be executed and delivered (including by facsimile transmission)
        in
        one or more counterparts, and by the different parties hereto in separate
        counterparts, each of which shall be deemed to be an original, but all of
        which
        taken together shall constitute one and the same agreement. The titles of
        the
        Sections of this Agreement are used for convenience only and are not to be
        considered in construing or interpreting this Agreement.

       

      11.   Notices.
        Any
        notice required or permitted hereunder shall be given in writing and shall
        be
        conclusively deemed effectively given upon personal delivery or delivery
        by
        courier, or on the first business day after transmission if sent by confirmed
        facsimile transmission or electronic mail transmission, or five days after
        deposit in the United States mail, by registered or certified mail, postage
        prepaid, addressed (i) if to the Company, as set forth below the Company's
        name
        on the signature page of this Agreement, and (ii) if to an Investor, at such
        Investor's address as set forth on the Signature page of this Agreement,
        or at
        such other address as the Company or such Investor may designate by 10 days'
        advance written notice to the other parties hereto.

       

      12.   Amendments
        and Waivers.
        Any
        provision of this Agreement may be amended and the observance of any provision
        of this Agreement may be waived (either generally or in a particular instance
        and either retroactively or prospectively), only with the written consent
        of the
        Company and the Holders of at least 50% of the Registrable Stock then
        outstanding. Any amendment or waiver effected in accordance with this
        Section 12 shall be binding upon each Holder of any securities subject
        to
        this Agreement at the time outstanding (including securities into which such
        securities are convertible), each future Holder and all such securities,
        and the
        Company. No failure or delay by any party in exercising any right, power
        or
        privilege hereunder shall operate as a waiver thereof nor shall any single
        or
        partial exercise thereof preclude any other or further exercise thereof or
        the
        exercise of any other right, power or privilege.

       

      13.   Severability;
        Entire Agreement.
        If one
        or more provisions of this Agreement are held to be unenforceable under
        applicable law, such provisions shall be excluded from this Agreement and
        the
        balance of this Agreement shall be interpreted as if such provisions were
        so
        excluded and shall be enforceable in accordance with its terms. All prior
        agreements of the parties concerning the subject matter of this Agreement
        are
        expressly superseded by this Agreement. This Agreement contains the entire
        Agreement of the parties concerning the subject matter hereof. Any oral
        representations or modifications of this Agreement shall be of no
        effect.

       

      14.   Governing
        Law.
        This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        State of Texas without regard to conflicts of law principles.

       

      15.   Forum;
        Waiver of Jury Trial.

       

      (a)   All
        actions and proceedings arising out of or relating to this Agreement shall
        be
        heard and determined in the Texas Superior Court or the United States Superior
        Court located in the City of Houston, Texas. The parties hereto hereby
        (i) submit to the exclusive jurisdiction of the Texas Superior Court
        or the
        United States Superior Court located in the City of Houston, Texas for the
        purpose of any action or proceeding arising out of or relating to this Agreement
        brought by any party hereto, and (ii) waive, and agree not to assert
        by way
        of motion, defense, or otherwise, in any such action, any claim that it is
        not
        subject personally to the jurisdiction of the above-named courts, that its
        property is exempt or immune from attachment or execution, that the action
        or
        proceeding is brought in an inconvenient forum, that the venue of the action
        or
        proceeding is improper, or that this Agreement may not be enforced in or
        by any
        of the above-named courts.

       

      
        
          
          

        

        
          -8-

          
            

          

        

        
          
          

        

         

      

      (b)   EACH
        OF
        THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
        LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTIONS
        OR
        PROCEEDINGS DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
        WITH
        THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

       

      

       

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          -9-

          
            

          

        

        
          
          

        

      

       

      IN
        WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
        date
        first above written.

       

       

      
        	POSITRON CORPORATION,  	 	 	SOLARIS OPPORTUNITY FUND,
                L.P., 
	a Texas corporation 	 	 	 
	 	 	 	 
	By: 	 	 	By:
	
                
   Gary
                H. Brooks,
                President	 	 	
                
    Name:
                _______________________________________
	 	 	 	    Title: ________________________________________
	 	 	 	 
	
                Address:
                  1304 Langham Creek Drive, #300, 

                      
Houston,
                  Texas 77084

              	 	 	
                Address: 700
                  Commerce Drive

                     Oak
                  Brook, IL 60523

              

      

      
 

       

      
        
          
          

        

        
          -10-

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