March 26, 2014 VIA FEDEX AND EMAIL Heska Corporation
Exhibit 10.4
March 26, 2014
VIA FEDEX AND EMAIL
Heska Corporation
0000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxxx
Email: xxxxx.xxxxxxxxxx@xxxxx.xxx
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Re:
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Accounting for CEO Compensation; Conditional Waiver of Cuattro 18-Month Call Option
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Dear Xxxxx:
Reference is made to that certain Amended and Restated Operating Agreement of Heska Imaging US, LLC ("Heska Imaging"), dated as of February 22, 2013 (the "Operating Agreement") by and among Heska Corporation ("Heska"), Cuattro, LLC (the "Member Representative"), Xxxxx X. Xxxxxx, Xxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxxxxxx, Xxxxxx X. Xxxxxxxxx and Xxxxx Xxxx, DVM (collectively, with Member Representative, the "Continuing Members"). Capitalized terms used but not defined herein shall have the meanings set forth in the Operating Agreement.
Accounting for CEO Compensation. Consistent with clause (i)(F) of the definition of "Operating Income" under Article I of the Operating Agreement, no compensation expense, including but not limited to charges related to stock-based compensation, for compensation earned by Xxxxx X. Xxxxxx pursuant to his Employment Agreement with Heska dated as of the date hereof (the "New Employment Agreement") shall be allocated to, or included in any tax return (including supporting data and documentation) or calculation of Operating Income with respect to, Heska Imaging under the Operating Agreement for so long as the New Employment Agreement is in force and effect and Heska has not acquired 100% of the equity interest in Heska Imaging (the "Accounting Interpretation").
Conditional Waiver of Cuattro 18-Month Call Option. Whereas, pursuant to Section 9.05(c) of the Operating Agreement, the Member Representative has the right, but not the obligation, to exercise the Cuattro 18-Month Call Option prior to the expiration of the Cuattro 18-Month Call Period.
Now, therefore, if, and only if, the stockholders of Heska approve the Share Increase Proposal at the Annual Meeting (as such terms are defined in the Employment Agreement), pursuant to Sections 9.05(a) and 11.04 of the Operating Agreement, the Member Representative hereby irrevocably waives, effective on the date of such approval of the Share Increase Proposal, and the Continuing Members whose signatures are set forth below hereby irrevocably consent to such waiver of, its right to exercise the Cuattro 18-Month Call Option from and after such date (the "Waiver"). If the stockholders of Heska do not approve the Share Increase Proposal at the
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Annual Meeting, the Waiver is void ab initio and the Cuattro 18-Month Call Option shall remain in full force and effect.
Please indicate Heska's acknowledgment and acceptance of the Waiver and the Accounting Interpretation by signing in the space provided below and returning an executed copy of this letter by email to:
Cuattro, LLC
XX Xxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx
Email: xxxxx.xxxxxx@xxxxx.xxx
This letter may be executed one or more counterparts and may be executed by original or facsimile signature, all of which taken together shall constitute one and the same original document.
[Signature page follows]
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Sincerely,
CUATTRO, LLC,
as the Member Representative
By: The Xxxxxx Family Trust, its sole member
By: /s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx, its trustee
By: /s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx, its manager
By:
Xxxx Xxxxxx, Jr., its manager
Acknowledged, agreed and consented to, as of the date first written above:
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/s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
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/s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
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/s/ Xxxxxx X. Xxxxxxxxxx
Xxxxxx X. Xxxxxxxxxx
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/s/ Xxxxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxxxxxx
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/s/ Xxxxx Xxxx
Xxxxx Xxxx, DVM
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Acknowledged and agreed to as of March 26, 2014:
HESKA CORPORATION
By: /s/ Xxxxx Xxxxxxxxxx
Xxxxx Xxxxxxxxxx, its Chief Financial Officer
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