Document:

Exhibit

        
 

Exhibit 10.21
HESKA CORPORATION 
1997 STOCK INCENTIVE PLAN
RESTRICTED STOCK GRANT AGREEMENT

THIS AGREEMENT is made as of the 1st day of December, 2017 (the “Grant Date”) by and between Heska Corporation (the “Company”) and Kevin Wilson (the “Executive”).
In consideration of the mutual covenants and representations herein set forth, the Company and Executive agree as follows:
Section 1.GRANT OF STOCK.
1.1    Precedence of Plan.  This Agreement is subject to and shall be construed in accordance with the terms and conditions of the Heska Corporation 1997 Stock Incentive Plan (the “Plan”), as now or hereinafter in effect.  Any capitalized terms that are used in this Agreement without being defined and that are defined in the Plan shall have the meaning specified in the Plan.  
1.2    Grant of Stock.  The Company hereby grants to Executive an aggregate of     45,000 shares of Restricted Stock (the “Shares”), subject to vesting as provided in Section 2.
Section 2.    UNVESTED SHARES SUBJECT TO FORFEITURE.  
2.1    Shares Subject to Forfeiture.  The Shares are subject to the following vesting restrictions:
a.    Market Price Vesting.  Subject to the terms and conditions of this Agreement, 5,625 Shares shall vest on the Market-Vesting Date following achievement of each Market-Vesting Threshold (collectively, the "Market-Vesting Shares"). For purposes of this Agreement, a “Market-Vesting Threshold” will be achieved each time the 20-Day Price first equals or exceeds each of the following thresholds achieved on or before December 1, 2024:  (i) $110.00, (ii) $125.00, and (iii) $150.00. For purposes of this Agreement, the “Market-Vesting Date” with respect to each Market-Vesting Threshold will be the date such Market-Vesting Threshold is first achieved; provided, that if the Company achieves one or more Market-Vesting Thresholds on or before the first anniversary of the Grant Date (the “First Anniversary”), the Market-Vesting Date for the Shares that would otherwise then vest shall instead be the First Anniversary. For purposes of this Agreement, the "20-Day Price" shall mean, with respect to any date, the average of the closing prices per share of the Company's Common Stock for the 20 trading days ending on such date (inclusive) on the NASDAQ Stock Market, or if the Shares are not traded on the NASDAQ Stock Market, the average of the high bid and low asked prices on such trading days quoted on the NASDAQ OTC Bulletin Board or by the National Quotation Bureau, Inc., or a comparable service as determined in the discretion of the Committee (as applicable, the “Closing Price”).  In the event of a stock split, stock dividend or reverse stock split affecting the Shares, the Committee shall adjust the Market-Vesting Thresholds to appropriately reflect such event.  

-1-

b.    Operating Income Vesting.  Subject to the terms and conditions of this Agreement, 9,375 Shares shall vest on the Income-Vesting Date following achievement of each Income-Vesting Threshold (collectively, the "Income-Vesting Shares").  For purposes of this Agreement, an “Income-Vesting Threshold” will be achieved on each Reporting Date that the Company's Operating Income for the preceding fiscal year first equals or exceeds  each of the following thresholds for fiscal years through and including 2024:  (i) $25,000,000 (ii)  $30,000,000 and (iii) $35,000,000 (collectively, the "Income-Vesting Shares"). For purposes of this Agreement, the “Income-Vesting Date” will be (1) with respect to each Income-Vesting Threshold achieved on or before the Reporting Date in 2022, the earlier of (i) the third anniversary of the date such Income-Vesting Threshold is first achieved and (ii) the Reporting Date in 2022 and (2) with respect to each Income-Vesting Threshold achieved after the Reporting Date in 2022, the Reporting Date for such achievement. (The Income-Vesting Dates, together with the Market-Vesting Dates, are sometimes referred to herein as the “Vesting Dates”.)  For purposes of this Agreement, "Reporting Date" means the date in each fiscal year that the Company's independent public accountants issue their Financial Report on the Company's financial statements for the preceding fiscal year (each, a "Financial Report).  For purposes of this Agreement, "Operating Income" means for any fiscal year, the following, determined on a consolidated basis in accordance with generally-accepted accounting principles for the Company and its subsidiaries, based on the Financial Report for such year:  (x) consolidated net income plus (y) the sum of the following, without duplication, to the extent deducted in determining such consolidated net income:  (i) income and franchise tax expense and  (ii) interest and other expense (net). Notwithstanding any provision of this Agreement to the contrary, all Income-Vesting Shares that do not vest pursuant to this paragraph on or before March 31, 2025 will be forfeited. 
c.    Financial Statement Restatement.  Notwithstanding any provision of this Agreement to the contrary, the Shares shall be subject to the terms and conditions of this Section in the event that the Company issues a restatement of its audited financial statements (a "Restatement") after any portion of the Shares has vested.  If (i) any portion of the Shares vests based on achievement of an Income-Vesting Threshold and within 3 years thereafter the Company issues a Restatement affecting Operating Income for the corresponding fiscal year such that the Income-Vesting Threshold would not have been met, then the corresponding portions of the Shares shall be deemed not to have vested, and (ii) any portion of the Shares vests based on achievement of a Market-Vesting Threshold and within 3 years thereafter the Company issues a Restatement, and the Committee determines in its good faith discretion, based on a reasonable estimate of the effect of the Restatement, that there is a reasonable likelihood that a Market-Vesting Threshold would not have occurred if the results reported in the Restatement had been reported initially, then the corresponding portions of the Shares shall be deemed not to have vested. If any portion of the Shares is deemed not to have vested pursuant to the foregoing sentence (an "Unearned Grant"), then Executive shall either (x) promptly return the Shares comprising the Unearned Grant to the Company or (y) if Executive has sold such Shares, pay to the Company within one (1) year from the date of the corresponding Restatement an amount equal to the proceeds Executive received from any sale of such Shares not returned by Executive pursuant to the foregoing clause (x). For the avoidance of doubt, if any portion of the Shares is deemed not to have vested as a result of a Restatement in accordance with this paragraph, such 

-2-

unvested portion will remain eligible for vesting on the terms and conditions of this Agreement for the remainder of the vesting periods set forth herein. In addition to the foregoing, Executive's compensation and equity awards shall remain subject to any applicable law (including without limitation Section 302 of the Sarbanes Oxley Act and Section 954 of the Dodd Frank Act) or regulation in effect from time to time.
d.    If, at any time, Executive's employment is terminated by the Company without Cause (as defined below) or by Executive for Good Reason (as defined below), and the termination is not In Connection with a Change of Control (as defined below), all further vesting of the Shares will terminate immediately; provided, that if, within one (1) year after any such termination, (A) the Company achieves one or more Market-Vesting Thresholds or (B)  a Reporting Date occurs on which the Company achieves one or more Income-Vesting Thresholds, then any Shares that would otherwise have vested by virtue of such achievement, if such termination had not occurred and Executive had served through the corresponding Vesting Date under this Agreement, shall be deemed to vest on such Vesting Date.
e.    In the event of a Change of Control (as defined below), any remaining unvested Shares will vest. If, at any time, Executive’s employment is terminated by the Company without Cause or by Executive for Good Reason, and the termination is In Connection with a Change of Control, then any remaining unvested Shares will vest.
f.    If Executive’s employment is terminated at least one (1) year following the Grant Date due to Executive’s death or Disability (as defined below), any remaining unvested Shares will vest. 
g.    Except as otherwise expressly provided in this Section 2.1, in the event that Executive’s employment with the Company is terminated prior to the vesting of all Shares, Executive will forfeit all right to any unvested Shares. 
2.2    Restriction on Transfer.  Until the Shares are vested, the Shares may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated.
Section 3.    STOCKHOLDER RIGHTS
3.1    Stock Register and Certificates.  The Shares will be recorded in the stock register of the Company in the name of Executive.  If applicable, a stock certificate or certificates representing the Shares will be registered in the name of Executive, but such certificates shall remain in the custody of the Company.  Executive shall deposit with the Company a Stock Assignment Separate from Certificate in the form attached below as Attachment 1, endorsed in blank, so as to permit retransfer to the Company of all or a portion of the Shares that are forfeited or otherwise do not become vested in accordance with the Plan and this Agreement.
3.2    Exercise of Stockholder Rights.  Executive shall have the right to vote the Shares (to the extent of the voting rights of said Shares, if any), to receive and retain all regular cash dividends and such other distributions, as the Board of Directors of the Company may, in its discretion, designate, pay or distribute on such Shares, and to exercise all other rights, powers 

-3-

and privileges of a holder of Common Stock with respect to such Shares, except as set forth in this Agreement and the Plan.
3.3    Legends.  Certificates, if any, representing the Shares will contain the following or other legends in the Company’s discretion:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS UPON AND OBLIGATIONS WITH RESPECT TO TRANSFER AND RIGHTS OF REPURCHASE AS SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE ORIGINAL REGISTERED HOLDER, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY.
Section 4.    RESPONSIBILITY FOR TAXES.
4.1    Section 83(b) Election.  Executive may complete and file with the Internal Revenue Service an election pursuant to Section 83(b) of the Internal Revenue Code to be taxed currently on the fair market value of the Shares without regard to the vesting restrictions set forth in this Agreement.  Executive shall be responsible for all taxes associated with the acceptance of the transfer of the Shares, including any tax liability associated with the representation of fair market value if the election is made pursuant to Code Section 83(b).
4.2    Withholding.  In accordance with Section 12 of the Plan, Executive agrees to make arrangements satisfactory to the Company for the satisfaction of any withholding tax obligations that arise in connection with the Plan under applicable federal, state, local or foreign law.  The Company in its discretion may permit Executive to satisfy all or part of Executive’s withholding or income tax obligations by having the Company withhold all or a portion of the Shares that otherwise would be issued to Executive on vesting.
Section 5.    MISCELLANEOUS.
5.1    Not an Employment Contract.  This Agreement is not an employment contract and nothing in this Agreement shall be deemed to create in any way whatsoever any obligation on the part of Executive to remain in the service of the Company in any capacity, or of the Company to continue Executive’s service in any capacity.
5.2    Effect on Employee Benefits.  Executive agrees that the Award will constitute special incentive compensation that will not be taken into account as “salary” or “compensation” or “bonus” in determining the amount of any payment under any pension, retirement, profit sharing or other remuneration plan of the Company unless so provided in such plan.
5.3    Further Assurances.  The parties agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement.

-4-

5.4    Entire Agreement.  This Agreement, including any exhibits, is the entire agreement of the parties with respect to the subject matter hereof and supersedes all prior oral and written understandings of the parties.
5.5    Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado as applied to contracts between Colorado residents to be wholly performed within the State of Colorado.
5.6    Definitions.    
a.    Cause.  For purposes of this Agreement, "Cause" shall mean the occurrence of one or more of the following: (i) conviction of, or entry of a plea of nolo contendere to, any felony crime (including one involving moral turpitude), or any crime which reflects so negatively on Heska to be detrimental to Heska's image or interests, or any act of fraud or dishonesty that has such negative reflection upon Heska; (ii) the repeated commitment of insubordination or refusal to comply with any reasonable request of the Board related to the scope or performance of Executive's duties; (iii) possession of any illegal drug on Heska premises or being under the influence of illegal drugs or abusing prescription drugs or alcohol while on Heska business, attending Heska-sponsored functions, or on Heska premises; (iv) the gross misconduct or gross negligence in the performance of Executive's responsibilities which, based upon good faith and reasonable factual investigation of the Board, demonstrates Executive's unfitness to serve; (v) material breach of Executive's obligations under this Agreement; or (vi) material breach of any fiduciary duty of Executive to Heska, which results in material damage to Heska or its business; provided, however, that if any occurrence under subsections (ii), (iv), (v), and (vi) may be cured, Heska will provide notice to Executive describing the nature of such event and Executive will thereafter have thirty (30) days to cure such event, and if such event is cured with that 30-day period, then grounds will no longer exist for terminating Executive's employment for Cause. 
b.    Change of Control.  For purposes of this Agreement, "Change of Control" means (i) a sale of all or substantially all of Heska's assets, (ii) any merger, consolidation, or other business combination transaction of Heska with or into another corporation, entity, or person, other than a transaction in which the holders of at least a majority of the shares of voting capital stock of Heska outstanding immediately prior to such transaction continue to hold (either by such shares remaining outstanding or by their being converted into shares of voting capital stock of the surviving entity) a majority of the total voting power represented by the shares of voting capital stock of Heska (or the surviving entity) outstanding immediately after such transaction, (iii) the direct or indirect acquisition (including by way of a tender or exchange offer) by any person, or persons acting as a group, of beneficial ownership or a right to acquire beneficial ownership of shares representing a majority of the voting power of the then outstanding shares of capital stock of Heska, (iv) a contested election of Directors, as a result of which or in connection with which the persons who were Directors before such election or their nominees cease to constitute a majority of the Board, or (v) a dissolution or liquidation of Heska.
c.    Disability.  For purposes of this Agreement, "Disability" shall mean that, by reason of any medically determinable physical or mental impairment that can be expected to 

-5-

result in death or can be expected to last for a continuous period of not less than twelve (12) months, the Executive either (i) is unable to perform the business and professional services in the performance of Executive's duties, consistent with Executive's position within Heska, as prior reasonably assigned to Executive by the Board, or (ii) is receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering Heska employees.
d.    Good Reason.
i.For purposes of this Agreement, "Good Reason" means the occurrence of any of the following without Executive's express written consent:  
A.Executive's authority with Heska is, or Executive's duties or responsibilities as President and Chief Executive Officer are, materially diminished relative to Executive's authority, duties, and responsibilities as in effect immediately prior to such change;
B.a material diminution in Executive's Base Salary as in effect immediately prior to such diminution; provided, that an across-the-board reduction in the base compensation and benefits of all other executive officers of Heska by the same percentage amount (or under the same terms and conditions) as part of a general base compensation reduction and/or benefit reduction shall not constitute such a qualifying material diminution;
C.a material change in the geographic location of Executive's principal place of employment such that the new location results in a commute for Executive that is both (A) longer than Executive's commute prior to the relocation and (B) greater than fifty (50) road miles each way from Executive's home in the Beaver Creek, Colorado area; 
D.any material breach by Heska of any provision of this Agreement; and
E.any acquiring company fails to assume or be bound by the terms of this Agreement In Connection with a Change of Control.
i.The aforementioned occurrences shall not be deemed Good Reason unless Executive gives Heska written notice of the existence of the condition which Executive believes constitutes Good Reason (which notice must be given within ninety (90) days of the initial existence of the condition) and such condition remains uncured for a period of thirty (30) days after the date of such notice.  An event of Good Reason shall occur automatically at the expiration of such 30-day period if the relevant condition remains uncured at such time.
e.    In Connection with a Change of Control.  For purposes of this Agreement, a termination of Executive's employment with Heska is "In Connection with a Change of Control" if Executive's employment is terminated without Cause or for Good Reason during the period beginning three (3) months prior to a Change of Control and ending twenty-four (24) months following a Change of Control.

-6-

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

HESKA CORPORATION
EXECUTIVE                              a Delaware corporation

By:                      
Title:                      
Address                  
                   

Attachment 1

ASSIGNMENT SEPARATE FROM CERTIFICATE

FOR VALUE RECEIVED, I, _____________________, hereby sell, assign and transfer unto                                                                               (                 ) shares of the Common Stock of Heska Corporation, standing in my name on the books of said corporation represented by Certificate No.         herewith and do hereby irrevocably constitute and appoint     
                         to transfer said stock on the books of the within-named corporation with full power of substitution in the premises.

Dated:                 , 20    .
Signature:                 

                                                 
This Assignment Separate from Certificate was executed in conjunction with the terms of a Restricted Stock Grant Agreement between the above assignor and Heska Corporation, dated __________ __, 20__.

		
	Instruction:
	Please do not fill in any blanks other than the signature line.

-7-Exhibit

Exhibit 10.34
SEPARATION AGREEMENT AND RELEASE
This Separation Agreement and Release (this “Agreement”) is made by and between Heska Corporation, for itself and for the benefit of its subsidiary Diamond Animal Health, Inc. (the “Company”) and Michael McGinley (“Employee”).  The Company and Employee are referred to below collectively as the “Parties” and individually as a “Party.”
RECITALS
WHEREAS, Employee currently is employed as the President, Biologicals and Pharmaceuticals, Heska Corporation;
WHEREAS, the Company and Employee are parties to an Employment Agreement dated as of May 1, 2000, as amended on January 1, 2008 (the “First Amendment”) and August 4, 2011 (the “Second Amendment”) (collectively the “Employment Agreement”), pursuant to which Employee has been employed by the company at-will, meaning that either Party may terminate Employee’s employment with or without cause, reason, or notice subject to the provisions of the Employment Agreement;
WHEREAS, the Company notified Employee on December 22, 2017 of its intent to cause the involuntary termination of his employment; 
WHEREAS, the Company has agreed to extend the date of Employee’s involuntary termination until March 31, 2018 (the “Separation Date”); 
WHEREAS, the Company wishes to benefit from Employee’s skills, knowledge, and experience during Employee’s transition to retirement and thereafter; and
WHEREAS, the Parties have entered into this Agreement to ensure the protection of the Company’s confidential information and trade secrets and to prevent damage to the Company caused by Employee using or disclosing the Company’s confidential information or trade secrets and competing unfairly against the Company.
NOW THEREFORE, in consideration of the foregoing and the mutual covenants and promises contained herein, the sufficiency of which is hereby acknowledged, the Parties agree as follows:
TERMS
1.Effective Date, Employment, Payments.
(a)    This Agreement shall become effective after expiration of the Revocation Period as provided in Section 5 below (the “Effective Date”), and, except as otherwise provided 

herein, shall replace and supersede all prior understandings and agreements between the Parties. In the event of any conflict between this Agreement and the Employment Agreement, this Agreement shall control.  
(b)    Employee shall continue to work through the Separation Date as needed by the Company.   
(c)    In consideration for Employee entering into this Separation Agreement and Release, Company shall pay Employee the severance pay in the amount and in the manner as provided in Section 6(b)(ii) of the Employment Agreement (“Severance Pay”). 
(d)    Employee’s receipt of the Severance Pay is subject to the following conditions:
(i)    Employee continuing to work as needed by the Company and as required by the Employment Agreement up and through the Separation Date; 
(ii)    Employee signing, and not revoking, this Agreement; 
(iii)    Employee signing, and not revoking, a final release of claims (the “Final Release”), in a form attached as Exhibit B, upon the Separation Date.   
(e)    Reporting and Withholding.  Reporting of and withholding on any payment under this Paragraph for tax purposes shall be at the discretion of the Company in conformance with applicable tax laws.  If a claim is made against the Company for any additional tax or withholding in connection with or arising out of any payment pursuant to this Agreement, Employee shall pay any such claim within thirty (30) days of being notified by the Company and agrees to indemnify the Company and hold it harmless against such claims, including, but not limited to, any taxes, attorneys’ fees, penalties, and/or interest, which are or become due from the Company.
 

(f)    Medical and Dental Benefits. Provided Employee timely elects continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), and further provided that Employee executes this Agreement and does not revoke Employee’s acceptance of the Agreement pursuant to Paragraph 5 below, the Company shall pay, for the time period beginning April 1, 2018 and ending September 30, 2018, the premiums for the COBRA coverage elected by Employee directly to the insurance provider(s).  For the balance of the period that Employee is entitled to coverage under COBRA, Employee shall be entitled to maintain coverage for Employee and Employee’s eligible dependents as pursuant to applicable law but shall be responsible for payment of the entire premium.  Employee shall notify the Company immediately upon Employee’s acceptance of employment with another employer during the COBRA continuation period. 

-2-
22

(g)    Employee shall resign from his employment with the Company effective March 31, 2018.  Employee’s resignation shall be deemed an “involuntary termination” of employment under the Employment Agreement.
(h)    Employee has received certain incentive restricted stock grants and stock options pursuant to the Company’s 1997 Incentive Stock Plan and related documents, the 2003 Incentive Stock Plan and related documents, and the various Stock Grant and Stock Option Agreements between Employee and the Company (each an “Option Document”).  Continued vesting and exercise of such restricted stock and stock options shall be governed by the Option Documents.  Employee and the Company acknowledge and agree that this Agreement does not represent a modification to any Option Document and to the extent this Agreement shall conflict with any Option Document, including in any manner that could be deemed a modification, the Option Documents shall control.  . Employee acknowledges that the Company’s agreement to extend the date of Employee’s involuntary separation from the Company pursuant to this Agreement and thereby allow certain unvested options and unvested restricted stock, which would otherwise be forfeited upon Employees’ termination of employment, constitutes sufficient and valuable consideration.
(i)    Employee is a participant in the Company’s 2017 Management Incentive Plan (“MIP”).  Company agrees that Employee shall continue to be a participant in the 2017 MIP and that Employee’s entitlement to compensation under the MIP shall be governed by the terms of the MIP and in accordance with the Company’s normal business practices. 
2.    Termination:  
If Employee’s employment terminates prior to the Separation Date due to Employee’s Voluntary Resignation or Employee’s Termination For Cause as defined in the Employment Agreement, Section 6(d) of the Employment Agreement shall control and in such event, Employee shall be entitled to only compensation earned as of the termination date.
3.    At-Will Employment.  Employee’s employment with the Company continues to be at-will.  Nothing in this Agreement alters Employee’s status as an at-will employee of the Company.  Subject to the terms of this Agreement, both the Company and Employee reserve the right to terminate Employee’s employment by the Company at any time, for any reason or no reasons, with or without cause, warning, or notice, subject to provisions of the Employment Agreement and this Agreement. 
4.    General Release.
(a)      Employee, for Employee, and for Employee’s affiliates, successors, heirs, subrogees, assigns, principals, agents, partners, employees, associates, attorneys, and representatives, voluntarily, knowingly, unequivocally, unconditionally and intentionally releases and discharges (i) the Company and its predecessors, successors, parents, subsidiaries, affiliates, and assigns, and (ii) each of their respective officers, directors, principals, shareholders, agents, attorneys, board members, and employees (the “Released Parties”) from any and all claims, actions, liabilities, demands, rights, damages, 

-3-
33

costs, expenses, and attorneys’ fees (including, but not limited to, any claim of entitlement for attorneys’ fees under contract, statute, or rule of law allowing a prevailing party or plaintiff to recover attorneys’ fees), of every kind and description from the beginning of time through the Effective Date (the “Released Claims”).
(b)    The Released Claims include, but are not limited to, those which arise out of, relate to, or are based upon: (i) Employee’s employment with the Company or the termination thereof; (ii) statements, acts, or omissions by the Released Parties whether in their individual or representative capacities; (iii) express or implied agreements between the Parties and claims under any severance plan (except as provided herein); (iv) any stock or stock option grant, agreement, or plan (except as provided herein); (v) all federal, state, and municipal statutes, ordinances, and regulations, including, but not limited to, claims of discrimination based on race, color, national origin, age, sex, sexual orientation, religion, disability, veteran status, whistleblower status, public policy, or any other characteristic of Employee under the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Americans with Disabilities Act, the Equal Pay Act, Title VII of the Civil Rights Act of 1964 (as amended), the Employee Retirement Income Security Act of 1974, the Rehabilitation Act of 1973, Family and Medical Leave Act, the Worker Adjustment and Retraining Notification Act, Colorado Anti-Discrimination in Employment Act, seq., or any other federal, state, or municipal law prohibiting discrimination or termination for any reason; (vi)state and federal common law; (vii) the failure of this Agreement or of any other employment, severance, profit sharing, bonus, equity incentive or other compensatory plan to which Employee and the Company are or were parties, to comply with, or to be operated in compliance with, Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”), or any similar provision of state or local income tax law; and (viii) any claim which was or could have been raised by Employee.
(c)    The General Release in this Agreement does not apply to claims under federal, state, or local law (statutory, regulatory, or otherwise) that may not be lawfully waived and released, including but not limited to vested retirement benefits (if any), COBRA rights, unemployment compensation, and workers’ compensation. If any claim is not subject to release, to the extent permitted by law: (i) you promise not to consent to become a party to or member of any class in a class, collective or multi-party action or proceeding in which claims are asserted against the Company that are related in any way to your compensation, employment or the separation of your employment with the Company; (ii) if, without your prior knowledge and consent, you  are made a member of a class in any such proceeding, you agree to opt out of the class at the first opportunity; and (iii) you waive any right or ability to be a class or collective action representative in such a proceeding. In the event that any claim, charge, or complaint is filed with any federal, state or local administrative agency in which you could be eligible to receive any damages or compensation from the Company, you hereby expressly waive any right to receive any monetary or other personal benefits that you would otherwise receive as a result of the said proceeding.
5.    ADEA and Older Workers Benefit Protection Act Release

-4-
44

In addition to the General Release contained in Paragraph 4, you knowingly, voluntarily, and irrevocably discharge and release the Released Parties from any claims arising under the Age Discrimination in Employment Act (ADEA).  You acknowledge that you have been informed pursuant to the federal Older Workers Benefit Protection Act of 1990 that:
You are advised to consult with an attorney before signing this Agreement.
You do not waive rights or claims under the federal Age Discrimination in Employment Act that may arise after the date this Agreement is executed.
You have twenty-one (21) days from the date of receipt of this Agreement to consider this Agreement.  You acknowledge that if you sign this Agreement before the end of the twenty-one (21)-day period, it will be your personal, voluntary decision to do so and that you have not been pressured to make a decision sooner.
You have seven (7) days after signing this Agreement to revoke the Agreement (the “Revocation Period”), and the Agreement will not be effective until that Revocation Period has expired.  If mailed, the rescission must be postmarked within the seven-day period, properly addressed to:
Heska Corporation
Attn:  Stephanie Alsip
Senior Manager, Human Resources
3760 Rocky Mountain Avenue
Loveland, CO  80538

This Agreement shall not be effective or enforceable, and no payments or benefits under this Agreement shall be provided to you, until after the seven (7) day Revocation Period has expired.  You understand that you will not receive any separation payment if you void your signature or revoke this Agreement.    
6.    Non-Competition and Non-Solicitation.  
(a)    During Employee’s remaining term of employment and for 36 months immediately following the Separation Date (“Restriction Period”), Employee shall not engage in any Competitive Conduct, as defined herein.  For the purposes of this Agreement, “Competitive Conduct” shall be determined in good faith by the Company and shall include any of the following conduct whether direct or indirect, on Employee’s own behalf or on behalf of, or in conjunction with, any person, partnership, corporation, or entity: 
(i)    owning, managing, operating, controlling, being employed by, participating in, engaging in, rendering any services for, assisting, having any financial interest in, permitting Employee’s name to be used in connection with, or being connected in any manner with the ownership, management, operation, or control of any Restricted Company, other than as set forth in paragraph 6(b) below.  For the purposes of this 

-5-
55

Agreement, a “Restricted Company” is any person or entity (as well as any affiliates or successors) that has purchased from the Company or a Company subsidiary product produced at a location in Des Moines, Iowa owned by the Company or a Company subsidiary in the twelve months ending December 31, 2017 including, without limitation Elanco Animal Health, a division of Eli Lilly and Company, Internet Inc., d/b/a Merck Animal Health, a unit of Merck and Co., Inc., Bayer AG and CEVA Sante` Animale.
(ii)    consulting with, acting as an agent for, or otherwise assisting any Restricted Company to compete or prepare to compete with the Company in any of the Company’s existing or prospective businesses;
(iii)    interfering with the relationship between the Company and any Restricted Company, current or former employee, independent contractor, vendor, or supplier of the Company, including, without limitation, soliciting, enticing, inducing or attempting to induce or influence such Restricted Company, current or former employee, independent contractor, vendor or supplier of the Company to terminate or alter his, her, or its relationship with the Company;
(iv)    interfering or attempting to interfere with any transaction in which the Company was involved or which was pending during the term of Employee’s employment or at the date on which Employee’s employment with the Company ends;
(v)    soliciting any of the Company’s customers, investors, or prospective customer or investor; and/or
(vi)    soliciting, inducing, or attempting to induce any customer or other business relation of the Company to cease doing business with Company or in any way interfering with the relationship between any such customer or business relation of the Company.  
(b)    Notwithstanding the foregoing, so long as Employee strictly complies with each and all of his obligations under this Agreement, including without limitation the requirements set forth at this Section 6(a)(i) through (vi) inclusively, without exception, after the Separation Date Employee may upon advance notice to Company be engaged by a Restricted Company as an independent contractor for the purpose of rendering advice unrelated to the Company, Company products, or Company activities. Activities in compliance with this section 6(b) shall not be deemed “Competitive Conduct.”  In such event, Employee shall notify any such Restricted Company who has engaged Employee as a contractor of the terms and existence of this Agreement and the provisions of this Section 6. 
(c)    Employee shall not engage in Competitive Conduct within the geographic areas in which the Company competes as of the Effective Date or at any time during the Restriction Period.
(d)    The extension of Employee’s employment until the Separation Date and the Severance Payment are conditioned upon Employee’s compliance with the restrictive covenants set 

-6-
66

forth in this Paragraph 6, which terms survive and continue in force following the expiration or termination of this Agreement until the expiration of the Restriction Period.  In the event that Employee violates the restrictive covenants or otherwise breaches this Agreement, all continuing payments and benefits to which Employee would otherwise be entitled pursuant to this Paragraph 6 will cease immediately in addition to, and not in lieu of, any other remedies to which the Company may be entitled.
7.    Confidentiality.  Employee and the Company are parties to an Employee Confidential Information and Inventions Agreement, effective as of March 18, 2013 (“Confidentiality Agreement”), which is attached hereto as Exhibit A and incorporated by reference.  Employee acknowledges that the Confidentiality Agreement remains in force and that Employee is bound by the Confidentiality Agreement pursuant to its terms.
8.    Remedies.  

		
	a.
	Injunctive Relief.  Employee acknowledges that any breach of Paragraphs 6 or 7 will cause the Company to suffer immediate and irreparable harm and damage for which money alone cannot fully compensate the Company. Employee agrees that upon breach or threat of imminent breach of any obligation under Paragraphs 6 or 7 of this Agreement, the Company shall be entitled to seek a temporary restraining order, preliminary injunction, permanent injunction, or other injunctive relief without posting any bond or other security.  This Paragraph shall not be construed as an election of any remedy, or as a waiver of any right available to the Company under this Agreement or the Colorado law governing this Agreement, including the right to seek damages from Employee.  

		
	b.
	Attorneys’ Fees.  In the event of any controversy, claim, or dispute between the parties affecting or relating to Paragraphs 6 or 7 of this Agreement, and the Company or Employee is required to defend its actions or seek enforcement of the Agreement, the prevailing party shall be entitled to recover all of his or its attorneys’ fees and costs.

c.    Separate Provisions.  Employee agrees the provisions of Paragraphs 6 or 7 of this Agreement are separate from and independent of the remainder of this Agreement and that these provisions are specifically enforceable by the Company notwithstanding any claim by Employee that the Company has violated or breached this Agreement. Notwithstanding the foregoing, if Company fails to pay Employee the Severance Pay as required by this Agreement, provided such failure is not a result of Employee’s breach of his obligations pursuant to this Agreement, and the Company fails to cure such breach within 30 days of written notice from Employee, Employee’s obligations under Paragraphs 6 and 7 shall cease.    

-7-
77

9.    Return of Company Property.  Employee represents and warrants that, Employee will return all Company property to the designated Company representative on or before Employee’s Separation Date, unless otherwise agreed upon.  This property includes, but is not limited to, Company documents and files (in any recorded media, such as papers, computer disks, copies, transparencies, and microfiche), cell phone/phone number, materials, keys, credit cards, laptops, computer disks, and badges.  Employee agrees that, to the extent that Employee possesses any files, data, or information relating in any way to the Company or the Company’s business on any personal computer, Employee will delete the data, files, or information (and will retain no copies in any form).

10.    Unknown Facts.  The releases in this Agreement include, but are not limited to, claims of every nature and kind, known or unknown, suspected or unsuspected.  Employee hereby acknowledges that Employee may hereafter discover facts different from, or in addition to, those which Employee now knows to be or believes to be true with respect to this Agreement, and Employee agrees that this Agreement and the releases contained herein shall be and remain effective in all respects, notwithstanding such different or additional facts or the discovery thereof.

11.    Confidentiality of Agreement.  The Parties agree to keep this Agreement confidential and will not disclose the existence or the terms of this Agreement to anyone except to his/its immediate family, accountants, legal or financial advisors, as part of an investigation or proceeding conducted by any Government Agency, or as otherwise appropriate or necessary as required by law, regulation or court order, unless and until this document is filed by the Company with the Securities and Exchange Commission. 

12.    No Admission of Liability.  The Parties agree that nothing contained herein, and no action taken by any Party hereto with regard to this Agreement, shall be construed as an admission by any Party of liability or of any fact that might give rise to liability for any purpose whatsoever
13.    Representations and Warranties.  Employee warrants and represents as follows:
(a)    Employee has read this Agreement, and Employee agrees to the conditions and obligations set forth in it.
(b)    Employee voluntarily executes this Agreement (i) after having been advised to consult with legal counsel, (ii) after having had opportunity to consult with legal counsel, and (iii) without being pressured or influenced by any statement or representation or omission of any person acting on behalf of the Company including, without limitation, the officers, directors, board members, committee members, employees, agents, and attorneys for the Company.

-8-
88

(c)    Employee has no knowledge of the existence of any lawsuit, charge, or proceeding against the Company or any of its officers, directors, board members, committee members, employees, successors, affiliates, or agents arising out of or otherwise connected with any of the matters herein released.  In the event that any such lawsuit, charge, or proceeding has been filed, Employee immediately will take all actions necessary to withdraw or terminate that lawsuit, charge, or proceeding, unless the requirement for such withdrawal or termination is prohibited by applicable law.
(d)    Employee has full and complete legal capacity to enter into this Agreement.
(e)    Employee acknowledges the success of the Company’s business depends in large part on the protection of the Confidential Information and trade secrets.  Employee acknowledges Employee’s access to the Confidential Information, coupled with the personal relationships and goodwill between the Company and its customers would enable Employee to compete unfairly against the Company.  Employee agrees that the provisions in Paragraphs 6 and 7 above are designed and intended to protect the Company’s trade secrets.  
(f)    As an Officer of Heska Corporation, Employee is among the Company’s executive personnel, management personnel, or officers and employees who constitute professional staff to executive and management personnel.  
(g)    Given the nature of the business in which the Company is engaged, the restrictions in Paragraphs 6 and 7 above, including their geographic scope and duration, are reasonable.
14.    Non-Disparagement.  Employee agrees not to make to any person any statement that disparages the Company or reflects negatively upon the Company, including, without limitation, statements regarding the Company’s financial condition, business practices, employment practices, or its predecessors, successors, parents, subsidiaries, officers, directors, employees, affiliates, agents, or representatives. Company agrees not make any statement that, disparages Employee. In response to any requests for references related to Employee, Company shall disclose only Employee’s dates of employment and positions held and no other information.
15.    Cooperation.  Employee agrees to cooperate with and assist the Company with any investigation, lawsuit, arbitration, or other proceeding to which the Company is subjected.  Employee will make Employee available for preparation for, and attendance of, hearings, proceedings, or trial, including pretrial discovery and trial preparation, subject to Company’s agreement to reimburse Employee for any reasonable and necessary expenses, including attorneys’ fees required to defend him in such proceeding.    Employee further agrees to perform all acts and execute any documents that may be necessary to carry out the provisions of this Paragraph.
16.    Section 409A.  This Agreement is intended to comply with Section 409A of the Code and Treasury Regulations promulgated thereunder (“Section 409A”) and shall 

-9-
99

be construed accordingly.  Section 11 of the Employment Agreement (also referenced as paragraph 5 of the Second Amendment) relating to 409A is incorporated by this reference.
17.    Severability.  If any provision of this Agreement is held illegal, invalid, or unenforceable, such holding shall not affect any other provisions hereof.  In the event, any provision is held illegal, invalid, or unenforceable, such provision shall be limited so as to give effect to the intent of the Parties to the fullest extent permitted by applicable law.  Any claim by Employee against the Company shall not constitute a defense to enforcement by the Company.
18.    Assignments.  The Company may assign its rights under this Agreement and any successor or assign of the Company or that acquires all or substantially all of the Company’s assets or a majority of the Company’s stock, shall remain bound by the terms and conditions set forth in this Agreement, including but not limited to the Severance payments.    No other assignment is permitted except by written permission of the Parties.
19.    Entire Agreement.  This Agreement (including Exhibits A and B), the Employment Agreement and the Option Documents are the entire agreement between the Parties.  Except as provided herein, this Agreement supersedes any and all prior oral or written promises or agreements between the Parties.  Employee acknowledges that Employee has not relied on any promise, representation, or statement other than those set forth in this Agreement.  This Agreement cannot be modified except in writing signed by all Parties. 
20.    Interpretation.  The determination of the terms of, and the drafting of, this Agreement has been by mutual agreement after negotiation, with consideration by and participation of all Parties.  Accordingly, the Parties agree that rules relating to the interpretation of contracts against the drafter of any particular clause shall not apply in the case of this Agreement.  The term “Paragraph” shall refer to the enumerated paragraphs of this Agreement.  The headings contained in this Agreement are for convenience of reference only and are not intended to limit the scope or affect the interpretation of any provision of this Agreement.
21.    Choice of Law and Venue.  This Agreement shall be construed and interpreted in accordance with the laws of the State of Colorado, without regard to its conflict of laws rules.  Venue shall be in the Colorado state or federal courts.
22.    Waiver.  The failure of any Party to insist upon strict performance of any of the terms or conditions of this Agreement shall not constitute a waiver of any of such Party’s rights hereunder. 
23.    Counterparts.  This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Facsimile and electronic signatures shall be treated as originals.

-10-
1010

IN WITNESS WHEREOF, this Agreement has been duly executed by the Company and by Employee on the dates set forth below:
Employee has carefully read the above and executes it voluntarily, fully understanding and accepting the provisions of this Agreement in its entirety and without reservation after having had sufficient time and opportunity to consult with legal advisors prior to executing this Agreement.  Employee has been advised to consult with an attorney prior to executing this Agreement.  In agreeing to sign this Agreement, Employee has not relied on any statements or explanation made by the Company.  Employee has had at least twenty-one (21) days to consider this Agreement.  Employee understands that if he does not return this Agreement signed by him to the Company upon the expiration of the twenty-one-day consideration period, this offer will expire.  Employee understands that he may revoke and cancel the Agreement within seven (7) days after signing it by serving written notice upon Company.

-11-
1111

Signature Page
 
 
 
EMPLOYEE                        THE COMPANY
 
/s/ Michael McGinley                _/s/ Kevin Wilson__________________
Michael McGinley                    Heska Corporation
By:  Kevin Wilson, CEO, President
12/23/2017                        __12/22/2017_____________________
Date                             Date 

-12-
1212

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00280-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00280-of-00352.parquet"}]]