Exhibit 10.5
 
EXECUTION VERSION
 
SHARE ESCROW AGREEMENT
 
THIS SHARE ESCROW AGREEMENT is made and entered into as of the 15th day of
April, 2011, by and among PRIVATE BANK MINNESOTA (hereinafter “Escrow Agent”),
ONPOINT MEDICAL DIAGNOSTICS, INC., a Minnesota corporation (hereinafter
“OnPoint”), and VERTICAL HEALTH SOLUTIONS, INC., a Florida corporation
(hereinafter “VHS”).
 
Recitals
 
WHEREAS, OnPoint, VHS and a wholly owned subsidiary of VHS (“Merger Sub”) have
entered into that certain Agreement and Plan of Merger, dated as of February 1,
2011 (the “Merger Agreement”), pursuant to which Merger Sub shall merge with and
into OnPoint (the “Merger”), such that following the Merger, OnPoint will become
a wholly owned subsidiary of VHS;

WHEREAS, pursuant to Section 1.12 of the Merger Agreement, VHS has agreed to
deposit with the Escrow Agent 1,000,000 shares of its common stock, par value
$0.001 per share (the “Escrow Shares”), together with any and all interest, cash
and non-cash dividends and other property at any time received or otherwise
distributed on, in respect of or in substitution or exchange for any or all of
the Escrow Shares, all certificates and instruments representing or evidencing
such securities, all cash and non-cash proceeds of all of the foregoing property
and all rights, titles, interest, privileges and preferences appertaining or
incident to the foregoing property (collectively referred to with Escrow Shares
as the “Escrow Property”);

WHEREAS, the Escrow Property shall be held and disposed of by the Escrow Agent
in accordance with the terms and conditions of this Agreement; and

WHEREAS, the Escrow Agent has agreed to act as escrow agent in relation to such
escrow arrangements on the terms and subject to the conditions of this
Agreement.

NOW, THEREFORE, in consideration of the premises and agreements set forth
herein, the parties hereto agree as follows:
 
Agreement
 
1.           Appointment.  OnPoint and VHS hereby appoint the Escrow Agent as
escrow agent for the purposes set out in this Agreement, and the Escrow Agent
accepts such appointment on the terms set out in this Agreement.
 
2.           Escrow Property.  Promptly following the execution and delivery of
this Agreement, VHS, pursuant to the Merger Agreement, shall deliver to the
Escrow Agent for deposit in escrow the Escrow Property.  The Escrow Property
shall be maintained by, and shall be under the exclusive dominion and control
of, the Escrow Agent and shall be released by the Escrow Agent only in
accordance with the provisions of this Agreement.
 
3.           Term of Escrow.  The “Term of Escrow” shall have effect as of the
date hereof, and shall continue thereafter until all Escrow Property has been
released in accordance with the terms of this Agreement.  The parties
acknowledge that the Escrow Agent shall have no duties to receive Escrow
Property or otherwise prior to the effective date of this Agreement.
 

 
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4.           Voting.  During the Term of Escrow, the OnPoint stockholders will
retain and be able to exercise all other incidents of ownership of the Escrow
Shares which are not inconsistent with the terms and conditions of this
Agreement and the Merger Agreement.  The OnPoint stockholders may vote the
Escrow Shares in accordance with their respective interests therein on all
matters submitted to a vote of the stockholders of VHS during the term of this
Agreement.
 
5.           Release of Escrow Property.  Upon receipt of a joint certification
from OnPoint and VHS, providing that either (i) an aggregate of $1,000,000 in
financing (the “Equity Release Amount”) has been received on or before December
31, 2011, or (ii) the Equity Release Amount has not been received on or before
December 31, 2011, the Escrow Property shall be released by the Escrow Agent to
VHS for distribution or cancellation in accordance with the terms of the Merger
Agreement.
 
6.           Duty and Liability of Escrow Agent.  The Escrow Agent hereby
accepts and agrees to perform its obligations hereunder.  The sole duty of
Escrow Agent, other than as herein specified, shall be to receive Escrow
Property and hold it subject to release, in accordance herewith, and Escrow
Agent shall be under no duty to determine whether OnPoint or VHS is complying
with requirements of this Agreement or the Merger Agreement.  Escrow Agent may
conclusively rely upon and shall be protected in acting upon any statement,
certificate, notice, request, consent, order or other document believed by it to
be genuine and to have been signed or presented by the proper party or
parties.  Escrow Agent shall have no duty or liability to verify any such
statement, certificate, notice, request, consent, order or other document, and
its sole responsibility shall be to act only as expressly set forth in this
Agreement.  Escrow Agent shall be under no obligation to institute or defend any
action, suit or proceeding in connection with this Agreement unless first
indemnified to its satisfaction.  Escrow Agent may consult in respect of any
question arising under this Agreement and Escrow Agent shall not be liable for
any action taken or omitted in good faith upon advice of such counsel.  All
funds held by Escrow Agent pursuant to this Agreement shall constitute trust
property for the purposes for which they are held.
 
7.           Binding Agreement and Substitution of Escrow Agent as Escrow
Agent.  Except as set forth in this Section, this Agreement may not be
transferred or assigned by any party hereto without the written consent of the
other parties.  The terms and conditions of this Agreement shall be binding on
the assigns, transferees, and successors in interest, whether by operation of
law or otherwise, of the parties hereto.  If, for any reason, Escrow Agent
should be unable or unwilling to continue to act as escrow agent hereunder, then
OnPoint and VHS may substitute another escrow agent.
 
8.           Escrow Agent’s Fee. Escrow Agent shall be entitled to receive from
OnPoint a fee of $1,000 as compensation for its basic services hereunder.  Such
fee is intended as full compensation for Escrow Agent’s services as contemplated
by this Agreement; provided, if Escrow Agent renders any material service not
contemplated in this Agreement, or there is any assignment of any interest in
the subject matter of this Agreement, or any material modification hereof, or if
any material controversy arises hereunder, or Escrow Agent consults with legal
counsel with respect to any question arising after its execution of this
Agreement, or Escrow Agent is made a party to or justifiably intervenes in any
litigation pertaining to this Agreement, or the subject matter hereof, Escrow
Agent shall be reasonably compensated for such extraordinary services and be
reimbursed for all costs and expenses, including reasonable attorney’s fees,
occasioned by any delay, controversy, litigation or event, and the same may be
recoverable from OnPoint only.
 

 
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9.           Notices.  All notices, deliveries and other communications given in
connection with this Agreement shall be in writing and shall be deemed to have
been given (i) when delivered in hand to OnPoint, VHS and Escrow Agent (being
all parties to this Agreement), or at the offices of OnPoint, VHS or Escrow
Agent, (ii) if sent by U.S. Certified Mail, on the date received by all parties
to this Agreement as noticed on the return receipt, (iii) if sent by facsimile
or email on the first business day following the date of transmission to all
parties to this Agreement; or (iv) if delivered by a nationally known overnight
delivery service (such as Federal Express, UPS or DHL), on the first business
day following the date timely delivered to such overnight service to all parties
to this Agreement.  Except as may be provided in any notice subsequently given
in the manner set forth above, all notices, deliveries and other communications
shall be addressed as follows:
 
If to OnPoint or VHS:
OnPoint Medical Diagnostics Inc.
 
Attention: William Cavanaugh
 
7760 France Avenue South, 11th Floor
 
Minneapolis, MN 55435
 
Facsimile:  (888) 370-2819
 
E-mail:  wcavanaugh@onpointmd.com
   
If to Escrow Agent:
Private Bank Minnesota
 
Attention:  Thomas E. Cardle
 
222 South 9th Street, Suite 3800
 
Minneapolis, MN  55402
 
Facsimile: (612) 321-0894
 
Email address:  TomC@PBMN.com
 
Phone:  (612) 321-0991
   
And a copy in all cases to:
Michael J. Macaluso
 
Morgan, Lewis & Bockius LLP
 
5175 Wells Fargo Center
 
90 South Seventh Street
 
Minneapolis, MN 55402
 
Facsimile No.:  (612) 344-1001
 
Email address:  mjmacaluso@morganlewis.com
 
Phone:  (612) 344-7610

 
10.           Execution and Amendment.  This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original.  This Agreement
may be amended or modified only by written agreement or consent of OnPoint, VHS
and Escrow Agent.
 
11.           Governing Law.  This Agreement shall be deemed to be entered into
and performed wholly within, and shall be governed by and construed in
accordance with the laws of the State of Minnesota.
 

 

 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first above written.
 
Vertical Health Solutions, Inc.
 
OnPoint Medical Diagnostics, Inc.
                   
By:
  /s/ Steve Watters  
By:
  /s/ William T. Cavanaugh  
Steve Watters, CEO
   
William T. Cavanaugh, CEO
         

 
Private Bank Minnesota

     
By:
  /s/ Thomas Cardle  
Its:
  Thomas Cardle, Vice President  

 
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[SIGNATURE PAGE TO SHARE ESCROW AGREEMENT]