UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549 

SCHEDULE 13D

Under the Securities Exchange Act of 1934 

(Name of Issuer) 

(Title of Class of Securities)

(CUSIP Number)

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box:  x

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

(Continued on the following pages)

SCHEDULE 13D

This statement relates to shares of Common Stock, par value $0.001 per share (“Shares”), of the Company. The Company’s principal offices are located at 180 Douglas Avenue East, Oldsmar, Florida 34677.

(a) This statement is filed by Stephen M. Watters, an individual, referred to herein as the “Reporting Person.”

(b) The address of the principal business office of the Reporting Person is 180 Douglas Avenue East, Oldsmar, Florida 34677.

(c) The Reporting Person is the Chief Executive and Financial Officer and a director of the Company.

(d) The Reporting Person has not, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e) The Reporting Person has not, during the last five years, been party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

(f) The Reporting Person is a citizen of the United States of America.

On February 1, 2011, Vertical Health Solutions, Inc. (the “Company”), entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among OnPoint Medical Diagnostics, Inc., a Minnesota corporation (“OnPoint”), the Company and Vertical HS Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”). Pursuant to the Merger Agreement, on the closing date of the merger, the Merger Sub will merge with and into OnPoint, which will be the surviving company and a wholly-owned subsidiary of the Company (the “Merger”).

On February 2, 2011, the Company and the Reporting Person entered into a Note Amendment and Wavier Agreement (the “Note Amendment Agreement”) whereby the Reporting Person acquired the right to convert a promissory note issued by the Company and other Company liabilities, aggregating $50,000 (the “Company Obligations”), in whole or part, up to the entire amount of the Company Obligations into Shares. Alternatively, and pursuant to the Note Amendment Agreement, the Reporting Person agreed to convert the Company Obligations into Shares in the event the Merger becomes effective.

In the event that the Reporting Person chooses to exercise the right to convert the entire amount of the Company Obligations into Shares or the Company Obligations are converted pursuant to the consummation of the Merger (the “Conversion”), the Reporting Person would acquire an aggregate of 44,474,937 Shares.

The information contained in Item 3 above is incorporated herein by reference.

As a condition to the Merger Agreement, the Company must extinguish certain outstanding liabilities, including the Company Obligations. The purpose of the Conversion is to extinguish the Company Obligations in order to comply with the conditions to closing the Merger.

Stephen M. Watters

(a),(b) The information set forth in Rows 7 through 13 of the cover page hereto for is incorporated herein by reference. Amounts include 44,474,937 Shares that are issuable upon the Conversion and 1,913,868 shares that are owned by SMW Capital Group Limited Partnership, a company owned and controlled by the Reporting Person. In addition, the amounts includes 228,575 shares are owned by Kristen Watters, the Reporting Person’s wife. The Reporting Person disclaims beneficial ownership of the shares registered in the name of his wife.

The percentage amount set forth in Row 13 for the cover page hereto is calculated based upon the 88,949,910 Shares that would be outstanding upon the Conversion.

(c) On February 2, 2011, the Company and the Reporting Person entered into the Note Amendment Agreement whereby the Reporting Person acquired the right to convert the Company Obligations into Shares.

(d) None.

(e) Not applicable.

The Merger Agreement

Subject to the terms and conditions of the Merger Agreement the Merger Sub will merge with and into OnPoint, which will be the surviving company and a wholly-owned subsidiary of the Company. OnPoint was founded to commercialize Magnetic Resonance Imaging Quality Assurance software and technologies developed by the Mayo Clinic. OnPoint is a development stage company leveraging technology and intelligent systems to assist the healthcare industry in delivering high quality medical images in a safe, consistent and efficient manner. These technology and intelligent systems are delivered in a Software-as-a-Service (SaaS) model, deployed in the cloud and exceed the accreditation standards required by law. OnPoint believes its comprehensive software service detects gradual degradation in image quality, saves time and money by improving consistency and reliability, and facilitates proactive preventative maintenance that minimizes unplanned downtime.

Note Amendment and Waiver Agreement

In connection with the Merger Agreement, the Company entered into the Note Amendment Agreement, whereby the Company Obligations shall, upon consummation of the Reverse Stock Split, convert into Shares of the Company’s common stock. Additionally, the Note Amendment Agreement grants the Reporting Person the right to convert the Company Obligations, in whole or part, up to the entire amount of the outstanding debt into Shares of the Company’s common stock at a conversion price of $0.001124253 per share. Pursuant to the Note Amendment Agreement, the Reporting Persons agreed to consent to the Merger.

The foregoing description of the Merger Agreement and the Note Amendment Agreement does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, which was filed by the Company as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC and the Note Amendment Agreement, which is filed herewith as Exhibit 1. Such exhibit is incorporated herein by reference.

There is filed herewith the Note Amendment and Waiver Agreement, executed on February 2, 2011, by and between Vertical Health Solutions, Inc. and Stephen M. Watters.

The Agreement and Plan of Merger, dated February 1, 2011, by and among OnPoint Medical Diagnostics, Inc., Vertical Health Solutions, Inc. and Vertical HS Acquisition Corp. was filed by the Company as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC. Such exhibit is hereby incorporated herein by reference.

SIGNATURE

After reasonable inquiry and to the best of the Reporting Person’s knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct.

Dated: March 17, 2011

EXHIBIT INDEX

EXHIBIT 1

NOTE AMENDMENT AND WAIVER AGREEMENT

This NOTE AMENDMENT AND WAIVER AGREEMENT (this “Amendment and Waiver”), dated as of February 2, 2011 (the “Effective Date”), by and between Vertical Health Solutions, Inc. a Florida corporation (the “Company”), and each of the holders of the promissory notes listed on the signature page hereto (the “Holders”).

WHEREAS, the Holders own certain promissory notes (the “Notes”) issued by the Company set forth on Schedule A hereto;

WHEREAS, the Company intends to enter into that certain merger agreement, dated as of February 1, 2011 (the “Merger Agreement”), whereby a wholly-owned subsidiary of the Company will be merger with and into OnPoint Medical Diagnostics, Inc. (the “Merger”);

WHEREAS, as a condition to the Merger, the Company must extinguish certain of its outstanding liabilities, including the Notes;

WHEREAS, as consideration for repayment of the Notes, the Holders have agreed to (i) convert such Notes into shares of common stock, par value $0.001 per share, of the Company (the “Common Stock”) and (ii) consent to the Merger; and

WHEREAS, the Company and the Holders now desire to amend the Notes to convert such Notes into shares of Common Stock, and in consideration therefor, each Holder has agreed to convert the Note held by such Holder and consent to the Merger.

NOW, THEREFORE, in consideration of the premises and mutual covenants herein below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Note Amendment. Effective upon the date hereof, the following provision is hereby added to each Note:

“Conversion into Common Shares. The Holder shall have the option to convert, as a whole or in part, up to the entire amount outstanding (including all principal and any accrued and unpaid interest, if applicable) under this Note into shares of common stock, par value $0.001 per share of Vertical Health Solutions, Inc. (the “Common Shares”) at any time or from time to time at a conversion price equal to $0.001124253 per share (the “Conversion Price”).”

2. Conversion of Notes. On the effective date of the Merger and immediately prior to the reverse stock split as contemplated by the Merger Agreement, each Holder hereby agrees to convert the outstanding principal amount and any accrued and unpaid interest (if applicable) of the related Notes into Common Stock pursuant to Section 1 above. Thereafter, such Holder shall not have any further rights, obligations, interests, benefits or claims under such Notes.

3. Consent to Merger Agreement. Each Holder hereby consents to the Merger and entry by the Company into the Merger Agreement. Each Holder acknowledges and agrees that the Company will rely on this Amendment and Waiver in connection with the Merger and to satisfy the conditions set forth therein.

4. This Amendment and Waiver shall be enforced, governed and construed in all respects in accordance with the laws of the State of Delaware and shall be binding upon the Holders, the Holders’ heirs, estate, legal representatives, successors and assigns and shall inure to the benefit of the Company, its successors and assigns

5. This Amendment and Waiver may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument, and may be executed by facsimile signatures.

* * * * * * *

IN WITNESS WHEREOF, this Amendment and Waiver has been duly executed by the parties hereto as of the date first written above.