Exhibit 10.1
ONPOINT
MEDICAL DIAGNOSTICS
SELLING
AGENCY AGREEMENT
FOR
PRIVATE PLACEMENT OF
CONVERTIBLE
PROMISSORY NOTES
This
Selling Agency Agreement is entered into by and between VERTICAL HEALTH SOLUTIONS, INC. (doing business as OnPoint Medical Diagnostics),
a Florida corporation (the “Company”), and Emergent Financial
Group, Inc. (the “Selling Agent”) as of August 1, 2012.
1. DESCRIPTION
OF OFFERING.
| (a) | | The Company proposes to issue in a private placement to accredited investors only
promissory notes the principal and accrued interest of which will be convertible into shares of the Company’s common stock
(the “Convertible Notes”). The conversion price for the Convertible Notes will be $0.25 per share (the
“Conversion Price”); provided, however that the Conversion Price shall be reduced to the price per share
at which the Company issues securities with gross proceeds of at least $2.5 million (a “Qualified Financing”)
if the offering price per share for the Qualified Financing is less than the Conversion Price. |
| (b) | | The notes will have a maturity date in August, 2015 and will bear simple interest at a rate
of six percent per annum. The holder of the note will have the option to convert the principal and the interest at any time
prior to maturity. Prepayment of the outstanding principal plus accrued but unpaid interest may be made anytime without
consent. The Company shall have the right to require conversion in the event of the occurrence of: (i) a Qualified
Financing, (ii) acquisition of the Company or
a sale of substantially all of its assets, or (iii) the Company obtains $500,000 of gross
revenue during any fiscal quarter. |
| (c) | | With respect to each one dollar of principal loaned under a Convertible Note, the
purchaser shall be issued a right to purchase a share of common stock of the Company at the purchase price of $1.25 a share. Such
right will be subject to the terms of a Warrant (the “Warrants” and together with the Convertible Notes,
the “Securities”) which will include a right of exercise during a ten year period. |
| (d) | | The Company contemplates an aggregate of approximately $1,500,000 of the Convertible
Notes being offered (the “Offering”). |
2. APPOINTMENT
OF AGENT. On the basis of the warranties, representations and agreements of the parties hereto, and the satisfaction of the
conditions set forth herein, the Company hereby appoints the Selling Agent, and the Selling Agent hereby accepts such appointment,
to act as the Company’s exclusive agent in connection with the offer and sale of the Securities, on a best efforts basis,
which appointment will be for the period set forth in Section 6 below. The Selling Agent will use its best efforts to solicit the
subscription for the Securities only from investors who the Selling Agent has a reasonable basis to believe are accredited investors.
3. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY. The Company represents and warrants to the Selling Agent as follows:
| (a) | | The Company will prepare a Term Sheet with respect
to the Offering together with the form of Convertible Notes and form of Warrant (collectively referred to herein as the “Offering
Documents”) for an offering under Rule 506 to purchasers that are all “accredited investors” within
the meaning of Regulation D under the Securities Act of 1933, as amended (the “Act”). The Company will
also prepare and, subject to prior review by the Selling Agent’s legal counsel, file a Form D and all other documents required
to comply with applicable exemptions from federal registration and state blue sky qualification with the Securities and Exchange
Commission and blue sky authorities of such states as may be requested by the Selling Agent. The Offering Documents (including
the proposed use of proceeds) and the Form D will be subject to the Selling Agent’s approval. |
| (b) | | As of the Commencement Date of the solicitation
(as defined in Section 6 below) and until and as of the date of each Closing (as hereinafter defined), the Offering Documents
will (i) contain all material statements which are required to be made therein in accordance with the Act and the Rules and Regulations
for an offering under Rule 506 to purchasers that are all “accredited investors” within the meaning of Regulation
D; (ii) in all material respects conform to the applicable requirements of the Act and of the Rules and Regulations adopted under
the Act (the “Rules and Regulations”) for an offering under Rule 506 to purchasers that are all “accredited
investors” within the meaning of Regulation D; and (iii) 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, provided that
the representations and warranties in this paragraph shall not apply to statements or omissions made in reliance upon written
information furnished to the Company by the Selling Agent expressly for use in preparation of the Offering Documents. |
| (c) | | The Company is duly organized and validly existing as a corporation in good standing
under the laws of the State of Florida, with full power and authority to own its properties and conduct its business, as described
herein and in the Company’s filings with the Securities and Exchange Commission (the “Filings”). |
| (d) | | The Company is duly qualified to do business
as a foreign entity and is in good standing in all states or jurisdictions in which the ownership or lease of its property or
the conduct of its business requires such qualification and the failure to be so qualified would have a materially adverse effect
on the Company’s business. |
| (e) | | The Company has full legal power, right and
authority to enter into this Agreement. This Agreement has been duly authorized, executed and delivered on behalf of the Company
and it is the valid and binding obligation of the Company, subject, as to enforcement, to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the rights of creditors generally, to the exercise of judicial discretion as to the availability
of equitable remedies such as specific performance and injunction and subject, as to enforcement of the indemnification provisions,
to limitations under applicable securities laws. |
| (f) | | Except as set forth in the Filings, the Company
has all licenses, certificates, permits and other approvals from governmental authorities necessary for the conduct of its business
as it is currently being carried on and as is described in the Filings, except those which would not have a material adverse effect
on the Company if not obtained. |
| (g) | | Except as set forth in the Filings, on the date
of each Closing, the Company will own or possess all patents, patent applications, trademarks, service marks, trade names, trademark
registrations, service ▇▇▇▇ registrations, copyrights, licenses, inventions, trade secrets and rights necessary for the conduct
of its business as it is currently being carried on and as is anticipated being carried on, except those which would not have
a material adverse effect on the business of the Company if not obtained, and has not received any notice of conflict with the
asserted rights of others in respect thereof. Except as described in the Offering Documents, to the best of the Company’s
knowledge after due inquiry previously performed in the ordinary course of business, no name which the Company uses and no other
aspect of the business of the Company involves or gives rise to any infringement of, or license or similar fees for, any patents,
patent applications, trademarks, service marks, trade names, trademark registrations, service ▇▇▇▇ registrations, copyrights,
licenses, inventions, trade secrets or other similar rights of others. |
| (h) | | Since March 31, 2012 (i) the Company has not
incurred any material liabilities or obligations, contingent or otherwise, not in the ordinary course of business, (ii) the Company
has not paid or declared any dividend or other distribution with respect to its outstanding equity interests, (iii) there has
not been any change in the capitalization or any material increase in the long-term debt of the Company, or any issuance of equity
interests in the Company or of options, warrants, or rights to purchase capital stock of the Company, with the exception of warrants
or S-8 shares issued in lieu of cash payments, for services, bonuses or as part of compensation to board members, advisory board
members, key employees, consultants and employees of consultants, and senior debt holders as principle or interest payments, (iv)
no material loss or damage (whether or not insured) to the property of the Company has been sustained, (v) no material legal or
governmental proceeding, domestic or foreign, affecting the Company or the transactions contemplated by this Agreement has been
instituted or threatened, and (vi) there has not been any material adverse change in the business, condition (financial and other)
or properties of the Company. |
| (i) | | Except as set forth in the Filings, the Company
is not in breach, default or violation of, and the consummation of the transactions herein contemplated will not result in any
breach of, any of the terms or conditions of, or constitute a default or violation under, (i) the articles of incorporation, bylaws
or other governing organizational of the Company, (ii) any material indenture, agreement or other instrument to which the Company
is now a party, or, (iii) except for such breaches, defaults or violations which would not have a material adverse effect on the
Company, any law or any order, rule or regulation applicable to the Company of any court or of any federal or state regulatory
body or administrative agency having jurisdiction over the Company or its property. |
| (j) | | No approval, authorization, consent or order
of any governmental or public board or body, other than in connection with or in compliance with the provisions of the Act and
the securities laws of various jurisdictions, is legally required for the sale of the Securities by the Company. |
| (k) | | Except as set forth in the Filings, there are
no pending, threatened or contemplated actions, suits or proceedings before or by any court or governmental agency, authority
or body, or any arbitrator to which the Company is a party or of which the business or property of the Company is subject, which
are not ordinary, routine and incidental to the business of the Company or which might result in any material adverse change in
the business condition (financial and other) or properties of the Company. |
| (l) | | As of the date hereof, the authorized capitalization of the Company consists of 250
million shares of $0.001 par value common stock and 5,000,000 shares of $0.001 par value preferred stock. As of August 13, 2012,
the issued and outstanding capitalization of the Company consists of 10,984,500 shares of common stock. All outstanding securities
of the Company have been duly authorized, validly issued and fully paid and are non-assessable and have been issued pursuant to
valid exemptions from the registration requirements of the Act and appropriate state blue sky laws. The Company will immediately
notify the Selling Agent in writing of any changes to the information set forth above. |
| (m) | | Except as described in the Filings, there are (i) no other outstanding warrants, options,
convertible securities, rights to subscribe for or purchase any capital or other securities from the Company, (ii) so far as known
to the Company, no voting trusts or voting agreements among, or irrevocable proxies executed by, members of the Company, (iii)
no existing rights of any person or members to require the Company to register any securities of the Company or to participate
with the Company in any registration by the Company of its ; (iv) so far as known to the Company, no agreement among members of
the Company providing for the purchase or sale of membership interests in the Company, and (v) no obligations (contingent or otherwise)
of the Company to purchase, redeem, or otherwise acquire membership interests in the Company or any interest therein or pay any
dividend or make any other distribution in respect thereof. |
| (n) | | The Company has good and marketable title, free
and clear of all liens, encumbrances and equities, and of all charges or claims, to all of the real and personal property owned
by it, except as described in the Filings and except liens, encumbrances and equities, and charges or claims, which are not material
in the aggregate and do not materially affect the value of such property or interfere with the conduct of its business. Except
as stated in the Filings , the Company has valid and binding leases to all of the real and personal property described in the
Filings as under lease to it with such exceptions as do not materially interfere with the conduct of its business. |
| (o) | | The Company has filed all necessary federal,
state and foreign income and franchise tax returns and has paid all taxes shown as due thereon, and the Company has received no
notice of any material tax deficiency that has been asserted against the Company. |
| (p) | | The Company has all requisite power and authority
to issue, sell and deliver the Securities. The Company has duly taken all required action for the due and proper authorization,
issuance, sale and delivery of such shares. No preemptive rights of shareholders of the Company exist with respect to the issuance
and sale of shares by the Company. No security holder of the Company possesses any registration rights, except as described in
the Filings. |
| (q) | | The Company has no subsidiaries, with the exception of OnPoint Medical Diagnostics,
Inc., which is wholly owned, and is not affiliated with any other company or business entity, except as explicitly stated in the
Filings. |
| (r) | | The historical financial statements of the Company filed with the SEC, together with
the related schedules and notes, fairly present the financial position and the results of operations of the Company at the respective
dates and for the respective periods to which they apply. All historical financial statements filed with the SEC by the Company
have been prepared in accordance with generally accepted accounting principles, consistently applied throughout the periods indicated,
except as may be otherwise stated therein and except as the financial statements for the interim periods are subject to year-end
adjustments. |
| (s) | | Except as set forth in this Agreement, no person is entitled, directly or indirectly,
to compensation from the Company or the Selling Agent for services as a finder in connection with the transactions contemplated
by this Agreement. |
| (t) | | No labor disturbance by the employees of the Company exists or, to the Company’s
knowledge, is imminent which could reasonably be expected to have a material adverse effect on the conduct of the business, operations,
financial condition or income of the Company. |
| (u) | | The Company has no defined benefit pension plan or other plan promulgated pursuant
to, or which is intended to comply with the provisions of, the Employee Retirement Income Security Act of 1974, except as disclosed
in the Offering Documents. |
| (v) | | The Company maintains insurance, which is in full force and effect, of the types and
in the amounts adequate for its business and in line with the insurance maintained by similar companies and businesses. |
| (w) | | The Company has not sold any securities in violation of the Act or any state securities
laws and the Company has not engaged in any “general advertising or solicitation”
(as such term is interpreted under the Act) in connection with the Offering. |
| (x) | | Subject to the Selling Agent’s compliance
with applicable securities laws, the offer, sale, issuance and delivery of the Securities are or will be in compliance
with the requirements for the use of Rule 506 of Regulation D promulgated under the Act for
an offering to purchasers that are all “accredited investors” within the meaning of Regulation D and exempt
from the registration and prospectus delivery requirements of the Act. |
4. FURTHER
AGREEMENTS OF THE COMPANY. The Company covenants and agrees as follows:
| (a) | | The Company will promptly deliver to the Selling
Agent and its counsel copies of the Offering Documents and each amendment or supplement
thereto. The Selling Agent is authorized on behalf of the Company to use and distribute copies of the Offering Documents
in connection with the solicitation of the subscriptions in the Offering as, and to the
extent, permitted by federal and applicable state securities laws. |
| (b) | | The Company will promptly notify the Selling
Agent, by telephone and in writing of (i) the issuance of any stop order suspending the sale of the Securities, or of the institution
or notice of intended institution of any action or proceeding for that purpose, and (ii) any other communication directed to the
Company by any public authority relating to the possible suspension of the qualification of the offer and sale of the Securities
in any state. |
| (c) | | Until the Termination Date, if any event relating
to or affecting the Company, or of which the Company shall be advised in writing by the Selling Agent, shall occur as a result
of which it is necessary, in the opinion of counsel for the Company or the Selling Agent, to supplement or amend the Offering
Documents in order to make the Offering Documents
not misleading in light of the circumstances existing at the time it is delivered to a potential purchaser of the Securities,
the Company will forthwith prepare amended or supplemented Offering Documents (in
form satisfactory to counsel for the Selling Agent) so that the amended or supplemented Offering Documents
will not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time the Offering Documents
are so amended or supplemented, not misleading. |
| (d) | | The Company shall pay, or cause to be paid,
all expenses incident to the performance of its obligations under this Agreement, including, but not limited to, all expenses
incident to the delivery of the Securities, the fees and expenses of counsel and accountants for the Company, the cost of filing
the Form D and amendments thereto, and the cost of all blue sky compliance and filings. |
| (e) | | In the event the Company shall elect to terminate
the Offering after execution of this Agreement, the Company will pay the Selling Agent the costs incurred by the Selling Agent
for legal fees, including the preparation of this Agreement. Such reimbursement shall not, however, exceed the sum of $1,500. |
5. REPRESENTATIONS,
WARRANTIES AND AGREEMENTS OF THE SELLING AGENT. The Selling Agent hereby represents and warrants to the Company as follows:
| (a) | | The Selling Agent is a member in good standing
of the Financial Industry Regulatory Authority (“FINRA”) and will maintain such good standing status
during the term of this Agreement. No proceedings are pending or, to the best of the Selling Agent’s knowledge, threatened
that, in any way, may revoke or limit the Selling Agent’s authority to commence the Offering, including, but not limited
to, any proceedings or actions by FINRA, the Securities and Exchange Commission, the Minnesota Department of Commerce or any other
applicable state blue sky authorities. |
| (b) | | The Selling Agent is a licensed broker-dealer
in good standing under the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder,
and the laws and regulations of Minnesota and such other states where the Securities may be offered or sold by the Selling Agent
and the Company will not be disqualified from relying on Rule 505 of Regulation D by reason of the application of Rule 505(b)(2)(iii)
to the Offering due to any act or omission of the Selling Agent or any of its directors, officers or employees. The representatives
employed by or contracting with the Selling Agent are duly licensed by FINRA, and are duly licensed in each of the states in which
offers, offers for sale, or sales of the Securities will be made. |
| (c) | | The Selling Agent will not solicit subscriptions
by any form of general solicitation or general advertising within the meaning of Rule 502(e) of Regulation D and will not solicit
subscriptions, other than on the basis of the Offering Documents. The Selling Agent
acknowledges that its solicitation efforts are to be directed to holders the Selling Agent believes are accredited investors,
as defined in Rule 501 of Regulation D. |
| (d) | | The Selling Agent agrees to provide to each
person or investor solicited by the Selling Agent a copy of the Offering Documents.
In connection with the Offering, the Selling Agent will not use any solicitation material other than the Offering Documents
and will not represent to any person or investor any material facts relating to the Offering,
the Company or the business of the Company, including its future prospects, unless such facts are contained in the Offering
Documents or have been provided to the Selling Agent in writing by the Company specifically
for such purpose. |
| (e) | | The Selling Agent has full power, right and
authority to enter into this Agreement, this Agreement has been duly authorized, executed and delivered by the Selling Agent and
it is the valid and binding obligation of the Selling Agent, subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the rights of creditors generally, to the exercise of judicial discretion
as to the availability of equitable remedies such as specific performance and injunction, and subject, as to enforcement of the
indemnification provisions, to limitations under applicable securities laws. |
6. SOLICITATION
PERIOD. Subject to applicable law, the Selling Agent shall commence the solicitation of prospective investors as soon as is
reasonably practicable following the date on which the Offering Documents are approved for release to potential investors by both
parties to this Agreement (the “Commencement Date”) and, unless otherwise terminated hereunder, shall
continue to solicit investment in the Securities until October 1, 2012 (the “Termination Date”).
7. DELIVERY,
PAYMENT AND CLOSING.
| (a) | | The Selling Agent shall require the subscribers
in the Offering to complete the subscription documentation supplied for that purpose by the Company. |
| (b) | | All proceeds from the sale of the Securities
shall be paid directly the Company. |
| (c) | | The Company shall promptly deliver the Convertible
Notes and Warrants to the subscribers solicited by Selling Agent promptly following acceptance of a subscription and provide to
Selling Agent copies of such instruments and the transmittal thereof to each subscriber. |
| (d) | | The cash compensation due Selling Agent shall
be paid promptly upon acceptance of a subscription by the Company and receipt of an invoice from the Selling Agent. |
8. SOLICITATION
COMPENSATION.
| (a) | | The Selling Agent shall receive from the Company ten percent (10%) of the gross proceeds
received from the acceptance of subscriptions solicited by Selling Agent as a compensation for acting as selling agent.
Such compensation is to be due and payable by the Company to the Selling agent in immediately available funds in connection
with the acceptance of the subscription. |
| (b) | | The Company shall pay to the Selling Agent a
non-accountable expense reimbursement equal to three percent (3%) of the gross proceeds received from the acceptance of
subscriptions solicited by Selling Agent. |
| (c) | | Promptly following the completion of the Offering,
the Selling Agent (or its designees) shall receive a warrant to purchase a number of shares of common stock of the Company equal
to ten percent (10%) of the aggregate number of shares issuable upon conversion of the Promissory Notes into shares of common
stock of the Company (which amount shall be inclusive of shares issuable upon conversion of all interest which may accrue through
the due date of the notes). Such warrant shall have a term of five years following issuance, provide an exercise price per share
equal to $0.25 per share and include a cashless exercise provision. The Company acknowledges that the Selling Agent may in the
future transfer the warrant granted to it pursuant to the terms hereof to its various brokers that participated in the Offering.
The Company hereby agrees, to the extent permitted by applicable law, to permit the transfer of such warrant to such brokers by
the Selling agent and to work with the Selling agent in facilitating such transfer. |
9. INDEMNIFICATION.
| (a) | | The Company (to the extent that it is not limited
by judgment of a proper court of law under the Act) shall indemnify and hold harmless the Selling Agent, and each person who controls
(as such term is defined by Rule 405 under the Act) the Selling Agent within the meaning of the Act, against any losses, claims,
damages or liabilities, joint and several, to which the Selling Agent or such controlling persons may become subject, under the
Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based
upon (i) any untrue statement or alleged untrue statement of any material fact contained in the Offering Documents, or any amendment
or supplement 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, or (ii) any inaccuracy in, or breach of,
the representations and warranties of the Company contained herein or any failure of the Company to perform its obligations hereunder
or under law; and the Company will reimburse the Selling Agent and each such controlling
person for any legal or other expenses reasonably incurred by such Selling Agent or such controlling person in connection with
investigating or defending any such loss, claim, damage, liability or action, as incurred; provided, however, that the Company
will not be liable in any such case to the extent that such loss, claim, damage or liability arises out of or is based upon any
untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with written
information furnished to the Company by the Selling Agent specifically for use in the preparation of the Offering Documents
or any additions or supplements thereto. This indemnity agreement will be in addition to
any liability which the Company may otherwise have. |
| The | | foregoing indemnity agreement is subject to
the condition that, insofar as it relates to any untrue statement, alleged untrue statement, omission or alleged omission made
in any form of the Offering Documents but eliminated or remedied by amendment or
supplement to the Offering Documents, such indemnity agreement shall not inure to
the benefit of the Selling Agent or each such controlling person with respect to any loss, liability, claim or damage asserted
by any person who purchased the Securities which are the subject thereof, if the Offering Documents was so
amended or supplemented prior to such acceptance of the subscription. |
| (b) | | The Selling Agent (to the extent that it is
not limited by judgment of a proper court of law under the Act), will indemnify and hold harmless the Company, each person who
controls (as such term is defined under Rule 405 under the Act) the Company within the meaning of the Act, each of its directors,
and each of its officers, against any losses, claims, damages or liabilities, joint and several, to which the Company, any such
controlling person, director or officer may become subject, under the act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in the Offering Documents, or arise out of or are
based upon the omission or the 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 is made in the Offering Documents,
in reliance upon and in conformity with written information furnished to the Company by the Selling Agent specifically for use
in the preparation thereof; and the Selling Agent will reimburse the Company, any such controlling person, director or officer
for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim,
damage, liability or action, as incurred. This indemnity agreement will be in addition to any liability which the Selling agent
may otherwise have. |
| (c) | | Promptly after receipt by an indemnified party
under this Section of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is
to be made against any indemnifying party under this Section, notify each indemnifying party in writing of the commencement thereof.
The indemnification provided for in this Section 9 shall not be available to any party who fails to so notify each indemnifying
party to the extent that the indemnifying party to whom notification was not given was unaware of the action to which the notification
would have related and was prejudiced by the failure to notify; provided, however, that the omission to so notify each indemnifying
party will not relieve any indemnifying party from any liability which it may have to any indemnified party otherwise than under
this section. In case any such action is brought against any indemnified party, and it notifies an indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate in, and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with counsel chosen by the indemnifying party and reasonably
satisfactory to the indemnified party, and after notice from the indemnifying party to such indemnified party of its election
so to assume the defense thereof, and selection of counsel satisfactory to the indemnified party, the indemnifying party shall
not be liable to such indemnified party under this section for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof other than reasonable costs of investigation. |
| (d) | | As an interim measure during the pendency of
any claim, action, investigation, inquiry or other proceeding as to which indemnification hereunder is sought, the Company will
reimburse the Selling Agent on a monthly basis for all reasonable legal fees or other expenses incurred in connection with investigating
or defending any such claim, action, investigation, inquiry or other proceeding, notwithstanding the absence of a judicial determination
as to the propriety and enforceability of the Company’s obligation to reimburse the Selling agent for such expenses and
the possibility that such payments might later be held to have been improper by a court of competent jurisdiction. To the extent
that any such interim reimbursement payment is ultimately held to have been improper, the Selling Agent shall promptly return
it to the party or parties that made such payment, together with interest, compounded daily, determined on the basis of the base
rate (or other commercial lending rate for borrowers of the highest credit standing) announced from time to time by ▇▇▇▇▇ Fargo
Bank, (“Prime Rate”). Any such interim reimbursement payments which are not made to the Selling agent within
30 days of a request for reimbursement shall bear interest at the Prime Rate from the date of such request. |
| (e) | | In order to provide for just and equitable contribution
in circumstances in which the indemnification provided for in Sections 9(a) or 9(b) is for any reason held, by a court of competent
jurisdiction, to be unenforceable as to any party entitled to indemnity, the Company and the Selling Agent, or any controlling
person of the foregoing, shall contribute to the aggregate losses, claims, damages and liabilities (including any investigation,
legal and other expenses incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding or
any claims asserted) to which the Company and the Selling agent, or any controlling person of the foregoing, may be subject (i) in
such proportion as is appropriate to reflect the relative benefits received by the Company, on the one hand, and the Selling agent
on the other from the offering contemplated hereby or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above
but also the relative fault of the Company, on the one hand, and of the Selling agent on the other in connection with the statements
or omissions which resulted in such loss, claim, damage, liability or expense, as well as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the Selling agent on the other shall be deemed to be in the
same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company bear to the total
sales commissions received by the Selling agent. The relative fault of the Company, on the one hand, and of the Selling agent
on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Selling
agent and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement
or omission. No person guilty of fraudulent misrepresentation or guilty of misstating or misrepresenting a material fact or failing
to state a material fact shall be entitled to contribution, as to any liability arising from such fraudulent misrepresentation
or omission, from any person who was not guilty of such fraudulent or other misrepresentation or omission. |
10. TERMINATION. The Selling
Agent shall have the right to terminate its obligations under this Agreement by giving the Company notice as hereinafter specified
at any time on or prior to the termination of the Offering if the Company shall have failed, refused or been unable to perform
any agreement on its part to be performed, if there shall have been a breach of any warranty or representation of the Company contained
herein, or because any other conditions of the Selling Agent’s obligations set forth herein are not fulfilled. The Company
shall have the right to terminate this Agreement by giving the Selling Agent notice as hereinafter specified at any time on or
prior to termination of the Offering if the Selling Agent shall have failed, refused or been unable to perform any agreement on
its part to be performed, if there shall have been a breach of any warranty or representation of the Selling Agent contained herein,
or because any other conditions of the Company’s obligations set forth herein are not fulfilled. Except
as provided in Section 11, any such termination shall be without liability of any party to any other party.
11. REPRESENTATIONS
AND AGREEMENTS TO SURVIVE. The respective covenants, agreements, representations and warranties of the Company and the Selling
Agent hereunder, as set forth in, or made pursuant to this Agreement, shall remain in full force and effect regardless of any investigation
made by or on behalf of any such party or any of its directors or officers or any controlling person, and shall survive delivery
of and payment for the Securities. The obligation to pay the compensation and expense reimbursement provided for in Section 8,
the expense payment provisions contained in Section 4(d), the indemnification and contribution agreements contained in Section
9 and this Section 11 shall also survive any termination of this Agreement.
12. NOTICES.
Except as otherwise expressly provided in this Agreement or duly noticed hereunder, all notices and other communications hereunder
shall be in writing and, if given to the Selling Agent, shall be mailed, delivered or faxed and confirmed to Emergent Financial
Group, Inc., Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇ and to the Company at the addresses set forth on the signature page hereof.
13. MISCELLANEOUS.
This Agreement shall inure to the benefit of and be binding upon the successors of the Selling Agent and of the Company. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to give any person or corporation, other than the parties
hereto and their successors, and the controlling persons and directors and officers referred to in Section 9, any legal or equitable
right, remedy or claim under or in respect to this Agreement or any provision hereof. The term “successors” shall not
include any purchaser of the Securities merely by reason of such purchase. No subrogee of a benefited party shall be entitled to
any benefits hereunder. This Agreement embodies the entire agreement and understanding of the parties hereto in respect
of the matters contemplated by this Agreement and supersedes all prior and contemporaneous agreements and understandings between
the parties with respect to the matters contemplated by this Agreement. This Agreement shall
be governed by and construed in accordance with the laws of the State of Minnesota, without regard to such state’s choice
of laws provisions.
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
VERTICAL
HEALTH SOLUTIONS, INC.
| By | | /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ |
| Address: | | ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ |
| with | | copy to: ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP |
EMERGENT
FINANCIAL GROUP, INC.
| Address: | | ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ |
| ▇▇▇▇▇ | | ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
