Exhibit 10.1

 

CERTIFICATE OF AMENDMENT
TO RESTATED
CERTIFICATE OF INCORPORATION
OF
HESKA CORPORATION
 
Heska Corporation, a corporation organized and existing under the laws of the
State of Delaware, (the "Corporation"), does hereby certify that:
 
1.  This Amendment to the Corporation's Restated Certificate of Incorporation
has been duly adopted in accordance with the provisions of Section 242 of the
General Corporation Law of the State of Delaware.
 
2.  This Amendment to the Corporation's Restated Certificate of Incorporation
amends Article IV of the Corporation's Restated Certificate of Incorporation, by
deleting the existing Article IV in its entirety and substituting therefor a new
Article IV to read in its entirety as follows:
 
 
ARTICLE IV
 
A.   Authorized Stock.  The total authorized stock of the Corporation, which
shall be an aggregate of 175,000,000 shares, shall consist of three
classes:  (i) a class consisting of 75,000,000 shares of existing Common Stock
having a par value of $0.001 per share (the "Original Common Stock"); (ii) a
second class consisting of 75,000,000 shares of NOL Restricted Common Stock
having a par value of $0.001 per share (the "Common Stock", and together with
the Original Common Stock, the "Common Stock Securities"); and (iii) a third
class consisting of 25,000,000 shares of Preferred Stock having a par value of
$0.001 per share (the "Preferred Stock").
 
B.   Preferred Stock.  The Preferred Stock may be issued in any number of
series, as determined by the Board of Directors.  The Board of Directors may by
resolution fix the designation and number of shares of any such series, and may
determine, alter, or revoke the rights, preferences, privileges and restrictions
granted to or imposed upon any wholly unissued series.  The Board of Directors
may thereafter in the same manner, within the limits and restrictions stated in
any resolution or resolutions of the Board of Directors originally fixing the
number of shares constituting any series, increase or decrease the number of
shares of any such series (but not below the number of shares of that series
then outstanding).  In case the number of shares of any series shall be
decreased, the shares constituting such decrease shall resume the status which
they had prior to the adoption of the resolution originally fixing the number of
shares of such series.
 
C.   Common Stock Securities.
 
1.  Relative Rights of Preferred Stock and Common Stock Securities.  All
preferences, voting powers, relative, participating, optional or other special
rights and privileges, and qualifications, limitations or restrictions of the
Common Stock Securities are expressly made subject and subordinate to those that
may be fixed with respect to any shares of the Preferred Stock.
 

 
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2.  Relative Rights of Original Common Stock and Common Stock.  Except as
otherwise provided in this Article IV, all shares of Original Common Stock and
Common Stock shall be identical and shall entitle the holder thereof to the
same preferences, voting powers, relative, participating, optional or other
special rights and privileges, and qualifications, limitations or restrictions.
 
3.  Voting Rights.  Except as otherwise required by law or this Restated
Certificate of Incorporation, the holder or holders of Common Stock Securities
shall vote together as one class, and each holder of Common Stock Securities
shall have one vote in respect of each share of such stock held by such holder
of record on the books of the corporation, for the election of directors and on
all matters submitted to a vote of stockholders of the corporation.
 
4.  Dividends.  Subject to the preferential rights of the Preferred Stock, if
any, the holders of shares of Common Stock Securities shall be entitled to
receive, when and if declared by the Board of Directors, out of the assets of
the corporation which are by law available therefor, dividends payable either in
cash, in property or in shares of capital stock.
 
5.  Liquidation, Dissolution or Winding Up.  In the event of any dissolution,
liquidation or winding up of the affairs of the corporation, after distribution
in full of the preferential amounts, if any, to be distributed to the holders of
shares of the Preferred Stock, holders of Common Stock Securities shall be
entitled, unless otherwise provided by law or this Restated Certificate of
Incorporation, to receive all of the remaining assets of the corporation of
whatever kind available for distribution to stockholders ratably in proportion
to the number of shares of Common Stock Securities held by them respectively.
 
6.  Subdivisions and Combinations of Shares.  The corporation shall not in any
manner subdivide (by stock split, stock dividend or otherwise) or combine (by
stock split, stock dividend or otherwise) the outstanding Common Stock or
Original Common Stock unless all outstanding Common Stock Securities are
proportionately subdivided or combined.
 
7.  Automatic Conversion.  Each share of NOL Restricted Common Stock shall
automatically be converted into the equivalent number of shares of Original
Common Stock at the close of business of the Corporation on the Restriction
Release Date.  Upon the occurrence of such automatic conversion, all shares of
NOL Restricted Common Stock shall be converted without any further action by the
holders of such shares and whether or not the certificates representing such
shares are surrendered to the Corporation or its transfer agent, and shall no
longer be deemed to be outstanding and all rights with respect to such shares
shall immediately cease and terminate, except only the right to receive shares
of Original Common Stock in exchange therefor.  Upon the occurrence of such
automatic conversion, the holders of NOL Restricted Common Stock shall, upon
notice from the Corporation, surrender the certificates representing such shares
at the office of the Corporation or of its transfer agent for the Common
Stock.  Thereupon, there shall be issued and delivered to such holder a
certificate or certificates for the number of shares of Original Common Stock
into which the shares of NOL Restricted Common Stock so surrendered were
automatically converted.  The Corporation shall not be obligated to issue such
certificates unless certificates evidencing the shares of NOL Restricted Common
Stock so converted are either delivered to the Corporation or any such transfer
agent, or the holder notifies the Corporation that such certificates have been
lost, stolen, or destroyed and executes an agreement satisfactory to the
Corporation to indemnify the Corporation from any loss incurred by it in
connection therewith.  Following such automatic conversion, all shares of NOL
Restricted Common Stock so converted shall be retired and cancelled, and the
Corporation shall not reissue any shares of NOL Restricted Common Stock.  The
Corporation shall, at all times prior to automatic conversion of the NOL
Restricted Common Stock, cause to be authorized and reserved for issuance a
number of shares of Original Common Stock sufficient to permit conversion of the
NOL Restricted Common Stock.
 
 
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D.   Reclassification.
 
Immediately upon the effectiveness of the filing of this Certificate of
Amendment to the Corporation's Restated Certificate of Incorporation with the
Secretary of State of the State of Delaware (the "Effective Time"), each share
of Original Common Stock issued and outstanding immediately prior to the
Effective Time shall be reclassified as and converted into and shall become one
share of NOL Restricted Common Stock ("Common Stock," pursuant to the
"Reclassification").
 
The Reclassification of the shares of Original Common Stock into shares of
Common Stock shall be deemed to occur at the Effective Time, regardless of when
any certificate previously representing such shares of Original Common Stock (if
such shares are held in certificated form) are physically surrendered to the
Corporation in exchange for certificates representing shares of such Common
Stock.  Each certificate outstanding immediately prior to the Effective Time
representing shares of Original Common Stock shall, until surrendered to the
Corporation in exchange for a certificate representing such new number of shares
of Common Stock, automatically represent from and after the Effective Time the
reclassified number of shares of Common Stock.  All options and rights issuable
or issued with respect to Original Common Stock pursuant to any stock option
plan, employee stock purchase plan or other stock plan of the Corporation prior
to the Effective Time shall represent options and rights for the equivalent
number of shares of Common Stock from and after the Effective Time.

E.   Transfer Restrictions.
 
1.   Certain Definitions. As used in this Section E:
 
"Acquire" or "Acquisition" and similar terms means the acquisition of record,
legal, beneficial or any other ownership of Corporation Securities by any means,
including, without limitation, (a) the exercise of any rights under any option,
warrant, convertible security, pledge or other security interest or similar
right to acquire shares, or (b) the entering into of any swap, hedge or other
arrangement that results in the acquisition of any of the economic consequences
of ownership of Corporation Securities, but shall not include the acquisition of
any such rights unless, as a result, the acquirer would be considered an owner
of Corporation Securities under the rules of Section 382 of the Code.
 
"Business Day" means any day, other than a Saturday, Sunday or day on which
banks located in Denver, Colorado, are authorized or required by law to close.
 
"Code" means the Internal Revenue Code of 1986, as amended, and the regulations
promulgated thereunder.
 
"Corporation Securities" means (a) shares of Common Stock Securities, (b) shares
of Preferred Stock of any class or series of Preferred Stock (other than
Preferred Stock that is not "stock" pursuant to Treasury Regulation Sections
1.382-2(a)(3) and 1.382-2T(f)(18)(ii) or any successor provision), (c) warrants,
rights or options (within the meaning of Treasury Regulation Section 1.382-4(d),
or any successor provision) to purchase Stock and (d) any other interests that
would be treated as "stock" of the Corporation pursuant to Treasury Regulation
Section 1.382-2T(f)(18), or any successor provision.
 
"Dispose" or "Disposition" means any direct or indirect sale, transfer,
assignment, conveyance, pledge or other disposition or other action in any
manner whatsoever, whether voluntary or involuntary, by operation of law or
otherwise, by any Person or group that reduces the Percentage Stock Ownership of
any Person or group.
 
"Entity" means an entity within the meaning of Treasury Regulation Section
1.382-3(a)(1).
 
 
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Five Percent Shareholder" means (i) a Person or group of Persons that is
identified as a "5-percent shareholder" of the Corporation pursuant to Treasury
Regulation Section 1.382-2T(g)(1)  (or any successor provision) or (ii) a Person
that is a "first tier entity" or "higher tier entity" of the Corporation if that
person has a "public group" or individual, or a "higher tier entity" of that
Person has a "public group" or individual, that is treated as a "5-percent
shareholder" of the Corporation pursuant to Treasury Regulation Section
1.382-2T(g) or any successor provision (where the terms "first tier
entity," "higher tier entity" and "public group" are defined in Treasury
Regulation Section 1.382-2T(f) or any successor provision), but excluding any
"public group" with respect to the Corporation, as that term is defined in
Treasury Regulation Section 1.382-2T(f)(13) (or any successor provision).  For
the purposes of determining the existence and identity of, and the amount of
Corporation Securities owned by, any Five Percent Shareholder, the Corporation
is entitled to rely conclusively on (a) the existence and absence of filings of
Schedules 13D or 13G under the Securities Exchange Act of 1934, as amended (or
any similar schedules) as of any date, and (b) its actual knowledge of the
ownership of the Corporation Securities.
 
"Percentage Stock Ownership" and similar terms means percentage Stock Ownership
of any Person or group for purposes of Section 382 of the Code, as determined in
accordance with Treasury Regulation Section 1.382-2T(g), (h), (j) and (k) (or
any successor provision).
 
"Person" means an individual, corporation, estate, trust, association, limited
liability company, partnership, joint venture or similar organization, and also
includes a syndicate or group as those terms are used for the purposes of
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended.
 
"Prohibited Transfer" means any purported Transfer of Corporation Securities to
the extent that such a Transfer is prohibited and/or void under this Article IV.
 
"Restriction Release Date" means such date, after the Effective Time, that is
the earlier of (i) the date that Section 382 of the Code or any successor
statute is repealed if the Board of Directors determines in good faith that this
Article IV is no longer necessary or advisable for preservation of the Tax
Benefits, (ii) the date that the Board of Directors determines in good faith
that it is in the best interests of the Corporation and its stockholders for the
transfer restrictions set forth in this Article IV to terminate, or
(iii) January 1, 2026.  Any such determinations by the Board of Directors shall
be set forth in a written resolution that is publicly announced or otherwise
made available to stockholders.
 
"Restricted Holder" means a Person or group of Persons that (a) is a Five
Percent Shareholder and Acquires or proposes to Acquire Corporation Securities,
or (b) is proposing to Acquire Corporation Securities, and following such
proposed Acquisition of Corporation Securities, would be a Five Percent
Shareholder.
 
"Stock" means any interest that would be treated as "stock" of the Corporation
pursuant to Treasury Regulation Sections 1.382-2(a)(3) and 1.382-2T(f)(18) (or
any successor provisions).
 
"Stock Ownership" means any direct or indirect ownership of Stock, including any
ownership by virtue of application of constructive ownership rules, with such
direct, indirect and constructive ownership determined under the provisions of
Section 382 of the Code.
 
"Tax Benefits" means the net operating loss carryovers, capital loss carryovers,
general business credit carryovers, alternative minimum tax credit carryovers
and foreign tax credit carryovers, as well as any loss or deduction attributable
to a "net unrealized built-in loss" within the meaning of Section 382 of the
Code, of the Corporation or any direct or indirect subsidiary thereof.

 
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"Transfer" means any direct or indirect Acquisition or Disposition of
Corporation Securities or other action in any manner whatsoever, whether
voluntary or involuntary, by operation of law or otherwise, that alters the
Percentage Stock Ownership of any Person or group, or any attempt to do any of
the foregoing.  A Transfer shall also include the creation or grant of an option
(including within the meaning of Treasury Regulation Section 1.382-4(d)).  A
Transfer shall not include an issuance or grant of Corporation Securities by the
Corporation.
 
"Treasury Regulation" means a Treasury Regulation promulgated under the Code.

2.   Transfer Restrictions.
 
(a)  From and after the Effective Time and prior to the Restriction Release
Date, no Transfer shall be permitted, and any such purported Transfer shall be
void ab initio, to the extent that after giving effect to such purported
Transfer (or any series of Transfers of which such Transfer is a part), either
(i) any Person or group of Persons shall become a Five Percent Shareholder, or
(ii) the Percentage Stock Ownership interest in the Corporation of any Five
Percent Shareholder shall be increased.  The prior sentence is not intended to
prevent the Corporation Securities from being DTC-eligible and shall not
preclude the settlement of any transactions in the Corporation Securities
entered into through the facilities of a national securities exchange or any
national securities quotation system, provided, that if the settlement of the
transaction would result in a Prohibited Transfer, such Transfer shall
nonetheless be a Prohibited Transfer.
 
(b)  The restrictions contained in this Article IV are for the purposes of
reducing the risk that any "ownership change" of the Corporation Securities (as
defined in the Code) may limit the Corporation's ability to utilize its Tax
Benefits.  In connection therewith, and to provide for effective policing of
these provisions, a Restricted Holder who proposes to Acquire Corporation
Securities shall, prior to the date of the proposed Acquisition, request in
writing (a "Request") that the Board of Directors of the Corporation (or a
committee thereof that has been appointed by the Board of Directors) review the
proposed Acquisition and authorize or not authorize the proposed Acquisition in
accordance with this Section E.2(b) of Article IV.  A Request shall be mailed or
delivered to the Secretary of the Corporation at the Corporation's principal
place of business, or telecopied to the Corporation's telecopier number at its
principal place of business.  Such Request shall be deemed to have been received
by the Corporation when actually received by the Secretary of the
Corporation.  A Request shall include (i) the name, address and telephone number
of the Restricted Holder, (ii) a description of the Restricted Holder's direct
and indirect ownership of Corporation Securities, (iii) a description of the
Corporation Securities that the Restricted Holder proposes to Acquire, (iv) the
date on which the proposed Acquisition is expected to take place (or, if the
Acquisition is proposed to be made by a Five Percent Shareholder in a
transaction on a national securities exchange or any national securities
quotation system, a statement to that effect), (v) the name of the proposed
transferor of the Corporation Securities that the Restricted Holder proposes to
Acquire (or, if the Acquisition is proposed to be made by a Five Percent
Shareholder in a transaction on a national securities exchange or any national
securities quotation system, a statement to that effect), and (vi) a request
that the Board of Directors (or a committee thereof that has been appointed by
the Board of Directors) authorize, if appropriate, the Acquisition pursuant to
this Section E.2(b) of Article IV.
 
(c)     The Board of Directors may authorize an Acquisition by a Restricted
Holder, or otherwise determine to waive the application of any restrictions
contained in this Article IV, if it determines, in its sole discretion, that,
after taking into account the preservation of the Tax Benefits, such Acquisition
or waiver would be in the best interests of the Corporation and its stockholders
and in such cases, the restrictions set forth in Section E.2(a) of this Article
IV shall not apply, notwithstanding the effect of any such authorization or
waiver on the Tax Benefits.  Any proposed Acquisition by a Restricted Holder
that is not so authorized by the Board of Directors or subject to such a waiver
shall be deemed a Prohibited Transfer.  The Board of Directors may, in its sole
discretion, impose any conditions that it deems reasonable and appropriate in
connection with authorizing any such Acquisition by a Restricted Holder or
granting such a waiver.  In addition, the Board of Directors may, in its sole
discretion, require such representations from the Restricted Holder or such
opinions of counsel to be rendered by counsel selected by the Board of
Directors, in each case as to such matters as the Board of Directors may
determine.  Any Restricted Holder who makes a Request to the Board of Directors
shall reimburse the Corporation, on demand, for all costs and expenses incurred
by the Corporation with respect to any proposed Acquisition of Corporation
Securities subject to such Request, whether or not such Request is granted,
including, without limitation, the Corporation's costs and expenses incurred in
determining whether to authorize the proposed Acquisition, which costs may
include, but are not limited to, any expenses of counsel and/or tax advisors
engaged by the Board of Directors to advise the Board of Directors or deliver an
opinion thereto.
 
 
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3.   Treatment of Excess Securities.
 
(a)  No employee or agent of the Corporation shall record any Prohibited
Transfer, and the purported transferee of a Prohibited Transfer (the "Purported
Transferee") shall not be recognized as a stockholder of the Corporation for any
purpose whatsoever in respect of the Corporation Securities which are the
subject of the Prohibited Transfer (the "Excess Securities").  The Purported
Transferee shall not be entitled with respect to such Excess Securities to any
rights of stockholders of the Corporation, including, without limitation, the
right to vote such Excess Securities and to receive dividends or distributions,
whether liquidating or otherwise, in respect thereof.  Once the Excess
Securities have been acquired in a Transfer that is not a Prohibited Transfer,
such Corporation Securities shall cease to be Excess Securities.
 
(b)      If the Board of Directors determines that a Prohibited Transfer has
been recorded by an agent or employee of the Corporation notwithstanding the
prohibition in Section E.3(a) of this Article IV, such recording and the
Prohibited Transfer shall be void ab initio and have no legal effect and, upon
written demand by the Corporation, the Purported Transferee shall transfer or
cause to be transferred any certificate or other evidence of ownership of the
Excess Securities within the Purported Transferee's possession or control,
together with any dividends or other distributions that were received by the
Purported Transferee from the Corporation with respect to the Excess Securities
(the "Prohibited Distributions"), to an agent designated by the Board of
Directors (the "Agent").  In the event of an attempted Prohibited Transfer
involving the purchase or Acquisition of Corporation Securities in violation of
this Article 4 by a Restricted Holder, the Agent shall thereupon sell to a buyer
or buyers, which may include the Corporation or the purported transferor, the
Excess Securities transferred to it in one or more arm's-length transactions
(including over a national securities exchange or national securities quotation
system on which the Corporation Securities may be traded); provided, however,
that the Agent, in its sole discretion, shall effect such sale or sales in an
orderly fashion and shall not be required to effect any such sale within any
specific time frame if, in the Agent's discretion, such sale or sales would
disrupt the market for the Corporation Securities, would adversely affect the
value of the Corporation Securities or would be in violation of applicable
securities laws.  If the Purported Transferee has resold the Excess Securities
before receiving the Corporation's demand to surrender the Excess Securities to
the Agent, the Purported Transferee shall be deemed to have sold the Excess
Securities for the Agent, shall be deemed to hold in trust for the Agent, and
shall be required to transfer to the Agent, any Prohibited Distributions and
proceeds of such sale, except to the extent that the Corporation grants written
permission to the Purported Transferee to retain a portion of such sales
proceeds not exceeding the amount that the Purported Transferee would have
received from the Agent pursuant to Section E.3(c) of this Article IV if the
Agent, rather than the Purported Transferee, had resold the Excess Securities.
 
 
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(c)  The Agent shall apply any proceeds of a sale by it of Excess Securities
and, if the Purported Transferee had previously resold the Excess Securities,
any amounts received by it from a Purported Transferee, together with any
Prohibited Distributions received by it, as follows:  (i) first, to reimburse
itself to the extent necessary to cover its costs and expenses incurred in
accordance with its duties hereunder; (ii) second, to reimburse the Purported
Transferee for the amounts paid by the Purported Transferee for the Excess
Securities (or in the case of any Prohibited Transfer by gift, devise or
inheritance or any other Prohibited Transfer without consideration, the fair
market value, calculated on the basis of the closing market price for the
Corporation Securities on the day before the Prohibited Transfer), and
(iii) third, the remainder, if any, to the original transferor, or, if the
original transferor cannot be readily identified, to the Company to the extent
of any amounts owing to the Company pursuant to Section E.3(f) below, with the
remainder, if any, to be donated to an entity designated by the Corporation's
Board of Directors that is described in Section 501(c) of the Code,
contributions to which must be eligible for deduction under each of Sections
170(b)(1)(A), 2055 and 2522 of the Code.  The recourse of any Purported
Transferee with respect of any Prohibited Transfer shall be limited to the
amount payable to the Purported Transferee pursuant to clause (ii) of this
Section E.3(c) of this Article IV.  Except as may be required by law, in no
event shall the proceeds of any sale of Excess Securities pursuant to this
Article IV inure to the benefit of the Corporation or the Agent, except to the
extent used to cover costs and expenses incurred by the Agent in performing its
duties hereunder.
 
(d)  In the event of any Transfer which does not involve a transfer of
securities of the Corporation within the meaning of Delaware law ("Securities,"
and individually, a "Security") but which would cause a Five Percent Shareholder
to violate a restriction on Transfers provided for in this Article IV, the
application of Section E.3(b) and Section E.3(c) shall be modified as described
in this Section E.3(d).  In such case, no such Five Percent Shareholder shall be
required to dispose of any interest that is not a Security, but such Five
Percent Shareholder and/or any Person whose ownership of Securities is
attributed to such Five Percent Shareholder shall be deemed to have disposed of
and shall be required to dispose of sufficient Securities (which Securities
shall be disposed of in the inverse order in which they were acquired) to cause
such Five Percent Shareholder, following such disposition, not to be in
violation of this Article IV.  Such disposition shall be deemed to occur
simultaneously with the Transfer giving rise to the application of this
provision, and such number of Securities that are deemed to be disposed of shall
be considered Excess Securities and shall be disposed of through the Agent as
provided in Section E.3(b) and Section E.3(c), except that the maximum aggregate
amount payable either to such Five Percent Shareholder, or to such other Person
that was the record owner of such Excess Securities, in connection with such
sale shall be the fair market value of such Excess Securities at the time of the
purported Transfer.  All expenses incurred by the Agent in disposing of such
Excess Stock shall be paid out of any amounts due such Five Percent Shareholder
or such other Person.  The purpose of this Section E.3(d) is to extend the
restrictions in Section E.2(a) and Section E.3(a) to situations in which there
is a Five Percent Shareholder without a direct Transfer of Securities, and this
Section E.3(d), along with the other provisions of this Article IV, shall be
interpreted to produce the same results, with differences as the context
requires, as a direct Transfer of Corporation Securities.
 
(e)  If the Purported Transferee fails to surrender to the Agent the Excess
Securities or the proceeds of a sale thereof, or any Prohibited Distributions
received by it, or to otherwise comply with Section E.3 of this Article IV,
within thirty (30) days from the date on which the Corporation makes a demand
pursuant to Section E.(3)(b) of this Article IV, or any written demand with
respect to a deemed disposition pursuant to Section E.3(d) of this Article IV,
then the Corporation may take such actions as it deems necessary or advisable to
enforce the provisions hereof, and/or enjoin or rescind any violation hereof,
including the institution of legal or equitable proceedings to compel such
surrender.
 
 
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(f)  If any Person shall knowingly violate, or knowingly cause any other Person
under control of such Person (a "Controlled Person") to violate this Article IV,
then that Person and any such Controlled Person shall be jointly and severally
liable for, and shall pay to the Corporation, such amount as will, after taking
account of all taxes imposed with respect to the receipt or accrual of such
amount and all costs incurred by the Corporation as a result of such violation,
put the Corporation in the same financial position as it would have been in had
such violation not occurred.
 
4.   Amendment of Transfer Restrictions.  Notwithstanding the provisions of
Article XII of the Corporation's Restated Certificate of Incorporation, the
Corporation may only amend or repeal any of the provisions set forth in this
Section E. by the affirmative vote of the holders of two-thirds of the shares
entitled to vote thereon.
 
5.   Legends; Compliance
 
(a)  All certificates reflecting Corporation Securities on or after the
Effective Time shall, until the Restriction Release Date, bear a conspicuous
legend in substantially the following form:
 
THE RESTATED CERTIFICATE OF INCORPORATION, AS AMENDED (THE "CERTIFICATE OF
INCORPORATION"), OF THE CORPORATION CONTAINS RESTRICTIONS PROHIBITING THE
TRANSFER (AS DEFINED IN THE CERTIFICATE OF INCORPORATION) OF STOCK OF THE
CORPORATION (INCLUDING THE CREATION OR GRANT OF CERTAIN OPTIONS, RIGHTS AND
WARRANTS) WITHOUT THE PRIOR AUTHORIZATION OF THE BOARD OF DIRECTORS OF THE
CORPORATION (THE "BOARD OF DIRECTORS") IF SUCH TRANSFER AFFECTS THE PERCENTAGE
OF STOCK OF THE CORPORATION (WITHIN THE MEANING OF SECTION 382 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND THE TREASURY REGULATIONS
PROMULGATED THEREUNDER) THAT IS TREATED AS OWNED BY A FIVE PERCENT SHAREHOLDER
UNDER THE CODE AND SUCH REGULATIONS.  IF THE TRANSFER RESTRICTIONS ARE VIOLATED,
THEN THE TRANSFER WILL BE VOID AB INITIO AND THE PURPORTED TRANSFEREE OF THE
STOCK WILL BE REQUIRED TO TRANSFER EXCESS SECURITIES (AS DEFINED IN THE
CERTIFICATE OF INCORPORATION) TO THE CORPORATION'S AGENT.  IN THE EVENT OF A
TRANSFER WHICH DOES NOT INVOLVE SECURITIES OF THE CORPORATION WITHIN THE MEANING
OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE ("SECURITIES") BUT WHICH
WOULD VIOLATE THE TRANSFER RESTRICTIONS, THE PURPORTED TRANSFEREE (OR THE RECORD
OWNER) OF THE SECURITIES WILL BE REQUIRED TO TRANSFER SUFFICIENT SECURITIES
PURSUANT TO THE TERMS PROVIDED FOR IN THE CORPORATION'S CERTIFICATE OF
INCORPORATION TO CAUSE THE FIVE PERCENT STOCKHOLDER TO NO LONGER BE IN VIOLATION
OF THE TRANSFER RESTRICTIONS.  THE CORPORATION WILL FURNISH WITHOUT CHARGE TO
ANY PROPERLY INTERESTED PERSON A COPY OF THE CERTIFICATE OF INCORPORATION,
CONTAINING THE ABOVE-REFERENCED TRANSFER RESTRICTIONS, UPON WRITTEN REQUEST TO
THE CORPORATION AT ITS PRINCIPAL PLACE OF BUSINESS."
 
The Board of Directors may also require that any certificates issued by the
Corporation evidencing ownership of shares of Stock that are subject to
conditions imposed by the Board of Directors under Section E.2(b) of this
Article IV also bear a conspicuous legend referencing the applicable
restrictions.
 
(b)  The Corporation shall have the power to make appropriate notations upon its
stock transfer records and to instruct any transfer agent, registrar, securities
intermediary or depository with respect to the requirements of this Article IV
for any uncertificated Corporation Securities or Corporation Securities held in
an indirect holding system.  At the request of the Corporation, or as a
condition to the registration of the Transfer of any Stock, any Person who is a
beneficial, legal or record holder of Stock, and any proposed transferee of such
Stock and any Person controlling, controlled by or under common control with the
proposed transferee of such Stock, shall provide such information as the
Corporation may request from time to time in order to determine compliance with
this Article IV or the status of the Tax Benefits of the Corporation.
 
 
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(c)  Nothing contained in this Article IV shall limit the authority of the Board
of Directors of the Corporation to take such other action to the extent
permitted by law as it deems necessary or advisable to preserve the
Corporation's Tax Benefits.  The Board of Directors of the Corporation shall
have the power to determine all matters necessary for determining compliance
with this Article IV, including, without limitation, determining (i) the
identification of Five Percent Shareholders and Restricted Holders, (ii) whether
a Transfer or proposed Transfer is a Prohibited Transfer, (iii) the Percentage
Stock Ownership in the Corporation of any Five Percent Shareholders and
Restricted Holders, (iv) whether an instrument or right constitutes a
Corporation Security, (v) the amount (or fair market value) due to a Purported
Transferee, (vi) the interpretation of the provisions of this Article IV, and
(vii) any other matters which the Board of Directors deems relevant.  In
addition, the Board of Directors may, to the extent permitted by law, from time
to time establish, modify, amend or rescind Bylaws, regulations and procedures
of the Corporation not inconsistent with the express provisions of this Article
IV for purposes of determining whether any Transfer of Stock would jeopardize
the Corporation's ability to preserve or use the Tax Benefits, or for the
orderly application, administration and implementation of the provisions of this
Article IV.  In the case of an ambiguity in the application of any of the
provisions of this Article IV, including any definition used herein, the Board
of Directors shall have the power to determine the application of such
provisions with respect to any situation based on its reasonable belief,
understanding or knowledge of the circumstances.  In the event that this Article
IV requires an action by the Board of Directors but fails to provide specific
guidance with respect to such action, the Board of Directors shall have the
power to determine the action to be taken so long as such action is not contrary
to the provisions of this Article IV.  All actions, calculations,
interpretations and determinations that are done or made by the Board of
Directors in good faith pursuant to this Article IV shall be final, conclusive
and binding on the Corporation, the Agent, and all other parties to a Transfer;
provided, however, that the Board of Directors may delegate all or any portion
of its duties and powers under this Article IV to a committee of the Board of
Directors as it deems advisable or necessary.  All references in this Article IV
to the Code and the regulations promulgated thereunder shall be deemed to
include any successor provision.
 
(d)  To the fullest extent permitted by law, the Corporation and the members of
the Board of Directors shall be fully protected in relying in good faith upon
the information, opinions, reports or statements of the chief executive officer,
the chief financial officer or the chief accounting officer of the Corporation
or of the Corporation's legal counsel, independent auditors, transfer agent,
investment bankers or other employees and agents in making the determinations
and findings contemplated by this Article IV, and the members of the Board of
Directors shall not be responsible for any good faith errors made in connection
therewith.
 
(e)  Nothing contained in this Article IV shall be construed to give any Person
other than the Corporation or the Agent any legal or equitable right, remedy or
claim under this Article IV.  This Article IV shall be for the sole and
exclusive benefit of the Corporation and the Agent.
 
(f)  With regard to any power, restriction, remedy or right provided herein or
otherwise available to the Corporation or the Agent provided under this Article
IV, (i) no waiver will be effective unless expressly contained in writing signed
by the waiving party; and (ii) no waiver alteration, modification or impairment
will be implied by reason of any previous waiver, extension of time, delay or
omission in exercise, or other indulgence.
 
(g)  If any provision of this Article IV or the application of any such
provision to any Person or under any circumstance shall be held invalid, illegal
or unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
of this Article IV.
 
 
[SIGNATURE PAGE FOLLOWS]

 

 
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IN WITNESS WHEREOF, this Certificate of Amendment to the Corporation's Restated
Certificate of Incorporation has been executed by a duly authorized officer of
the corporation on this the [     ]th day of [     ] 2010.
 
 

 
 
Heska Corporation
 
 
By:
     

 
 

 
 
Name:
     

 
Title:                
 

 

 
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