POSITRON CORP

On August 13, 2015 the Company reached an agreement with three of its creditors to convert an aggregate of $670,367 in advances into 670,367 newly issued shares of the Company’s 8% Series J Secured Redeemable Convertible Preferred Stock (the “Series J Preferred Stock”). As of September 30, 2015 , prior to the consummation of the agreements or filing the Certificate of Designation for or the issuance of the Series J Preferred Stock, the creditors advised the Company that they had withdrawn their acceptance of the settlement and deemed the agreements revoked.

On April 29, 2015 DX, LLC (“DX”), an entity controlled by Cecil O’Brate a principal and affiliated shareholder (owner of approximately 23% holder of the Company’s common stock) purchased the Company’s outstanding debt, accrued interest and fees in the recorded amount of $481,950 from LANB. The note is currently due on demand and bears interest at 16.0% per annum (default rate). The Company is currently in default and has received a demand letter from DX. The Company is currently negotiating with the note holder. On September 8, 2015, DX was one of three alleged creditors which filed an Involuntary Bankruptcy in the U.S. Bankruptcy Court, Northern District of Texas, requesting relief from the Bankruptcy Court under Chapter 11 of the U.S. Bankruptcy Code. At September 30, 2015 the outstanding principal balance and accrued interest was $481,950 and $32,624, respectively.

On September 8, 2015, Positron Corporation (the “Company”) was served with a petition for Involuntary Bankruptcy in the U.S. Bankruptcy Court, Northern District of Texas by three parties alleging to be creditors of the Company, including DX, LLC, an entity controlled by Cecil O’Brate a principal and affiliated shareholder (owner of approximately 23% holder of the Company’s common stock), requesting relief from the Bankruptcy Court under Chapter 11 of the U.S. Bankruptcy Code. The Company has filed a Motion to Dismiss or in the alternative to Transfer Venue to another Judicial District requesting the case be moved to the Northern District of Illinois.  Concurrently, an Answer was filed alleging that the Involuntary Petition is defective because the petitioning creditors are not qualified or the claims being asserted against the Debtor are the subject of a bona fide dispute either as to amount or liability.  There can be no assurance that the Company will be successful in either of these contested matters. There can be no assurance that the Company will be successful in averting bankruptcy or its outcome implementing its business plan and ultimately achieving operational profitability. The Company’s long-term viability as a going concern is dependent on its ability to 1) achieve adequate profitability and cash flows from operations to sustain its operations, 2) control costs and expand revenues from existing or new business 3) meet current commitments and fund the continuation of its business operation in the near future and 4) raise additional funds through debt and/or equity financings.

On September 8, 2015, the Company was served with a petition for Involuntary Bankruptcy in the U.S. Bankruptcy Court, Northern District of Texas by three parties alleging to be creditors of the Company, requesting relief from the Bankruptcy Court under Chapter 11 of the U.S. Bankruptcy Code. The Company has filed a Motion to Dismiss or in the alternative to Transfer Venue to another Judicial District requesting the case be moved to the Northern District of Illinois.  Concurrently, an Answer was filed alleging that the Involuntary Petition is defective because the petitioning creditors are not qualified or the claims being asserted against the Debtor are the subject of a bona fide dispute either as to amount or liability.  There can be no assurance that the Company will be successful in either of these contested matters.  If the petition is allowed to proceed it will hinder the Company’s ability to operate, borrow funds and raise capital.

On September 8, 2015, Company was served with a petition for Involuntary Bankruptcy in the U.S. Bankruptcy Court, Northern District of Texas by three parties alleging to be creditors of the Company, including DX, LLC, an entity controlled by Cecil O’Brate a principal and affiliated shareholder (owner of approximately 23% holder of the Company’s common stock), requesting relief from the Bankruptcy Court under Chapter 11 of the U.S. Bankruptcy Code. The Company has filed a Motion to Dismiss or in the alternative to Transfer Venue to another Judicial District requesting the case be moved to the Northern District of Illinois.  Concurrently, an Answer was filed alleging that the Involuntary Petition is defective because the petitioning creditors are not qualified or the claims being asserted against the Debtor are the subject of a bona fide dispute either as to amount or liability.  There can be no assurance that the Company will be successful in either of these contested matters.