UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
77-0192527
|
(State or other jurisdiction of
incorporation or organization) |
(I.R.S. Employer
Identification Number) |
3760 Rocky Mountain Avenue
Loveland, Colorado |
80538
|
(Address of principal executive offices)
|
(Zip Code)
|
Registrant's telephone number, including area code:
(970) 493-7272
|
Large accelerated filer
o
|
Accelerated filer
x
|
Non-accelerated filer
o
|
Smaller Reporting Company
¨
|
|
Emerging growth company
o
|
|
|
|
Page
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PART I - FINANCIAL INFORMATION
|
|
||
|
Item 1.
|
||
|
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||
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||
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||
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||
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||
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Item 2.
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||
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Item 3.
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||
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Item 4.
|
||
PART II - OTHER INFORMATION
|
|
||
|
Item 1.
|
||
|
Item 1A.
|
||
|
Item 6.
|
||
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
|
|
(unaudited)
|
|
|
||||
ASSETS
|
||||||||
Current assets:
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
9,236
|
|
|
$
|
9,659
|
|
Accounts receivable, net of allowance for doubtful accounts of $234 and $215, respectively
|
|
13,647
|
|
|
15,710
|
|
||
Due from – related parties
|
|
—
|
|
|
1
|
|
||
Inventories, net
|
|
27,639
|
|
|
32,596
|
|
||
Lease receivable, current, net of allowance for doubtful accounts of $36 and $0, respectively
|
|
2,777
|
|
|
2,069
|
|
||
Contract acquisition costs, current
|
|
840
|
|
|
30
|
|
||
Other current assets
|
|
3,904
|
|
|
3,066
|
|
||
Total current assets
|
|
58,043
|
|
|
63,131
|
|
||
|
|
|
|
|
||||
Property and equipment, net
|
|
16,284
|
|
|
17,331
|
|
||
Goodwill and intangible assets, net
|
|
28,349
|
|
|
28,645
|
|
||
Deferred tax asset, net
|
|
13,851
|
|
|
11,877
|
|
||
Lease receivable, non-current
|
|
11,521
|
|
|
9,615
|
|
||
Investments in unconsolidated affiliates
|
|
8,089
|
|
|
—
|
|
||
Contract acquisition costs, non-current
|
|
1,623
|
|
|
3
|
|
||
Other non-current assets
|
|
6,360
|
|
|
5,185
|
|
||
Total assets
|
|
$
|
144,120
|
|
|
$
|
135,787
|
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Current liabilities:
|
|
|
|
|
|
|
||
Accounts payable
|
|
$
|
4,545
|
|
|
$
|
9,489
|
|
Due to – related parties
|
|
280
|
|
|
1,828
|
|
||
Accrued liabilities
|
|
10,518
|
|
|
4,417
|
|
||
Current portion of deferred revenue
|
|
2,766
|
|
|
3,992
|
|
||
Line of credit and other short-term borrowings
|
|
6,019
|
|
|
6,000
|
|
||
Total current liabilities
|
|
24,128
|
|
|
25,726
|
|
||
|
|
|
|
|
||||
Deferred revenue, net of current portion, and other
|
|
8,391
|
|
|
9,621
|
|
||
Total liabilities
|
|
32,519
|
|
|
35,347
|
|
||
Commitments and contingencies (Note 13)
|
|
|
|
|
|
|
||
|
|
|
|
|
||||
Stockholders' equity:
|
|
|
|
|
|
|
||
Preferred stock, $.01 par value, 2,500,000 shares authorized, none issued or outstanding
|
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value, 10,250,000 and 10,000,000 shares authorized, respectively, none issued or outstanding
|
|
—
|
|
|
—
|
|
||
Public common stock, $.01 par value, 10,250,000 and 10,000,000 shares authorized, 7,552,596 and 7,302,954 shares issued and outstanding, respectively
|
|
76
|
|
|
73
|
|
||
Additional paid-in capital
|
|
249,755
|
|
|
243,598
|
|
||
Accumulated other comprehensive income
|
|
216
|
|
|
232
|
|
||
Accumulated deficit
|
|
(138,446
|
)
|
|
(143,463
|
)
|
||
Total stockholders' equity
|
|
111,601
|
|
|
100,440
|
|
||
Total liabilities and stockholders' equity
|
|
$
|
144,120
|
|
|
$
|
135,787
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Core companion animal health
|
|
$
|
27,190
|
|
|
$
|
25,578
|
|
|
$
|
80,652
|
|
|
$
|
75,453
|
|
Other vaccines, pharmaceuticals and products
|
|
3,765
|
|
|
4,758
|
|
|
12,729
|
|
|
17,847
|
|
||||
Total revenue, net
|
|
30,955
|
|
|
30,336
|
|
|
93,381
|
|
|
93,300
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
|
|
16,161
|
|
|
16,783
|
|
|
52,215
|
|
|
51,609
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Gross profit
|
|
14,794
|
|
|
13,553
|
|
|
41,166
|
|
|
41,691
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Selling and marketing
|
|
6,215
|
|
|
5,815
|
|
|
18,299
|
|
|
17,908
|
|
||||
Research and development
|
|
935
|
|
|
601
|
|
|
2,165
|
|
|
1,576
|
|
||||
General and administrative
|
|
11,239
|
|
|
3,359
|
|
|
20,223
|
|
|
11,081
|
|
||||
Total operating expenses
|
|
18,389
|
|
|
9,775
|
|
|
40,687
|
|
|
30,565
|
|
||||
Operating (loss) income
|
|
(3,595
|
)
|
|
3,778
|
|
|
479
|
|
|
11,126
|
|
||||
Interest and other (income) expense, net
|
|
(50
|
)
|
|
(6
|
)
|
|
37
|
|
|
(186
|
)
|
||||
(Loss) income before income taxes
|
|
(3,545
|
)
|
|
3,784
|
|
|
442
|
|
|
11,312
|
|
||||
Income tax expense (benefit):
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current income tax expense
|
|
27
|
|
|
8
|
|
|
56
|
|
|
25
|
|
||||
Deferred income tax (benefit) expense
|
|
(1,902
|
)
|
|
693
|
|
|
(1,997
|
)
|
|
762
|
|
||||
Total income tax (benefit) expense
|
|
(1,875
|
)
|
|
701
|
|
|
(1,941
|
)
|
|
787
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income
|
|
(1,670
|
)
|
|
3,083
|
|
|
2,383
|
|
|
10,525
|
|
||||
Net loss attributable to non-controlling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(498
|
)
|
||||
Net (loss) income attributable to Heska Corporation
|
|
$
|
(1,670
|
)
|
|
$
|
3,083
|
|
|
$
|
2,383
|
|
|
$
|
11,023
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic (loss) earnings per share attributable to Heska Corporation
|
|
$
|
(0.23
|
)
|
|
$
|
0.43
|
|
|
$
|
0.33
|
|
|
$
|
1.58
|
|
Diluted (loss) earnings per share attributable to Heska Corporation
|
|
$
|
(0.23
|
)
|
|
$
|
0.40
|
|
|
$
|
0.30
|
|
|
$
|
1.45
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average outstanding shares used to compute basic (loss) earnings per share attributable to Heska Corporation
|
|
7,289
|
|
|
7,139
|
|
|
7,194
|
|
|
6,985
|
|
||||
Weighted average outstanding shares used to compute diluted (loss) earnings per share attributable to Heska Corporation
|
|
7,289
|
|
|
7,668
|
|
|
7,820
|
|
|
7,580
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income
|
|
$
|
(1,670
|
)
|
|
$
|
3,083
|
|
|
$
|
2,383
|
|
|
$
|
10,525
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Foreign currency translation
|
|
15
|
|
|
(45
|
)
|
|
(16
|
)
|
|
125
|
|
||||
Comprehensive (loss) income
|
|
(1,655
|
)
|
|
3,038
|
|
|
2,367
|
|
|
10,650
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Comprehensive loss attributable to non-controlling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(498
|
)
|
||||
Comprehensive (loss) income attributable to Heska Corporation
|
|
$
|
(1,655
|
)
|
|
$
|
3,038
|
|
|
$
|
2,367
|
|
|
$
|
11,148
|
|
|
|
Common Stock |
|
Additional Paid-in Capital |
|
Accumulated
Other Comprehensive Income |
|
Accumulated Deficit |
|
Total Stockholders' Equity |
|||||||||||||
Three Months Ended September 30, 2017 and 2018
|
|
Shares
|
|
Amount
|
|
||||||||||||||||||
Balances, June 30, 2017
|
|
7,196
|
|
|
$
|
72
|
|
|
$
|
241,575
|
|
|
$
|
267
|
|
|
$
|
(145,339
|
)
|
|
$
|
96,575
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,083
|
|
|
3,083
|
|
|||||
Issuance of common stock, net of shares withheld for employee taxes
|
|
48
|
|
|
—
|
|
|
716
|
|
|
—
|
|
|
—
|
|
|
716
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
707
|
|
|
—
|
|
|
—
|
|
|
707
|
|
|||||
Distribution for Heska Imaging minority interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
(9
|
)
|
|||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(45
|
)
|
|
—
|
|
|
(45
|
)
|
|||||
Balances, September 30, 2017
|
|
7,244
|
|
|
$
|
72
|
|
|
$
|
242,998
|
|
|
$
|
222
|
|
|
$
|
(142,265
|
)
|
|
$
|
101,027
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balances, June 30, 2018
|
|
7,498
|
|
|
$
|
75
|
|
|
$
|
246,422
|
|
|
$
|
201
|
|
|
$
|
(136,776
|
)
|
|
$
|
109,922
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,670
|
)
|
|
(1,670
|
)
|
|||||
Issuance of common stock, net of shares withheld for employee taxes
|
|
55
|
|
|
1
|
|
|
1,927
|
|
|
—
|
|
|
—
|
|
|
1,928
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
1,406
|
|
|
—
|
|
|
—
|
|
|
1,406
|
|
|||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
15
|
|
|||||
Balances, September 30, 2018
|
|
7,553
|
|
|
$
|
76
|
|
|
$
|
249,755
|
|
|
$
|
216
|
|
|
$
|
(138,446
|
)
|
|
$
|
111,601
|
|
|
|
Common Stock |
|
Additional Paid-in Capital |
|
Accumulated
Other Comprehensive Income |
|
Accumulated Deficit |
|
Total Stockholders' Equity |
|||||||||||||
Nine Months Ended September 30, 2017 and 2018
|
|
Shares
|
|
Amount
|
|
||||||||||||||||||
Balances, December 31, 2016
|
|
7,026
|
|
|
$
|
70
|
|
|
$
|
238,635
|
|
|
$
|
97
|
|
|
$
|
(151,827
|
)
|
|
$
|
86,975
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,525
|
|
|
10,525
|
|
|||||
Issuance of common stock, net of shares withheld for employee taxes
|
|
218
|
|
|
2
|
|
|
1,425
|
|
|
—
|
|
|
—
|
|
|
1,427
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
2,093
|
|
|
—
|
|
|
—
|
|
|
2,093
|
|
|||||
Accretion of non-controlling interest
|
|
—
|
|
|
—
|
|
|
845
|
|
|
—
|
|
|
—
|
|
|
845
|
|
|||||
Distribution for Heska Imaging minority interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(963
|
)
|
|
(963
|
)
|
|||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
125
|
|
|
—
|
|
|
125
|
|
|||||
Balances, September 30, 2017
|
|
7,244
|
|
|
$
|
72
|
|
|
$
|
242,998
|
|
|
$
|
222
|
|
|
$
|
(142,265
|
)
|
|
$
|
101,027
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balances, December 31, 2017
|
|
7,303
|
|
|
$
|
73
|
|
|
$
|
243,598
|
|
|
$
|
232
|
|
|
$
|
(143,463
|
)
|
|
$
|
100,440
|
|
Adoption of accounting standards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,634
|
|
|
2,634
|
|
|||||
Balances, January 1, 2018, as adjusted
|
|
7,303
|
|
|
73
|
|
|
243,598
|
|
|
232
|
|
|
(140,829
|
)
|
|
103,074
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,383
|
|
|
2,383
|
|
|||||
Issuance of common stock, net of shares withheld for employee taxes
|
|
250
|
|
|
3
|
|
|
2,383
|
|
|
—
|
|
|
—
|
|
|
2,386
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
3,774
|
|
|
—
|
|
|
—
|
|
|
3,774
|
|
|||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
(16
|
)
|
|||||
Balances, September 30, 2018
|
|
7,553
|
|
|
$
|
76
|
|
|
$
|
249,755
|
|
|
$
|
216
|
|
|
$
|
(138,446
|
)
|
|
$
|
111,601
|
|
|
|
Nine Months Ended
September 30, |
||||||
|
|
2018
|
|
2017
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net income
|
|
$
|
2,383
|
|
|
$
|
10,525
|
|
Adjustments to reconcile net income to cash provided by operating activities:
|
|
|
|
|
|
|
||
Depreciation and amortization
|
|
3,473
|
|
|
3,586
|
|
||
Deferred income tax (benefit) expense
|
|
(1,997
|
)
|
|
762
|
|
||
Stock-based compensation
|
|
3,774
|
|
|
2,093
|
|
||
Other (income) expense
|
|
(2
|
)
|
|
7
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||
Accounts receivable
|
|
2,075
|
|
|
7,376
|
|
||
Inventories
|
|
3,935
|
|
|
(10,490
|
)
|
||
Due from related parties
|
|
1
|
|
|
78
|
|
||
Lease receivable, current
|
|
(708
|
)
|
|
(991
|
)
|
||
Other current assets
|
|
(778
|
)
|
|
(341
|
)
|
||
Accounts payable
|
|
(4,945
|
)
|
|
1,835
|
|
||
Due to related parties
|
|
(1,422
|
)
|
|
1,145
|
|
||
Accrued liabilities and other
|
|
6,102
|
|
|
(3,046
|
)
|
||
Lease receivable, non-current
|
|
(1,906
|
)
|
|
(3,985
|
)
|
||
Other non-current assets
|
|
(1,256
|
)
|
|
(620
|
)
|
||
Deferred revenue and other
|
|
(2,271
|
)
|
|
(1,656
|
)
|
||
Net cash provided by operating activities
|
|
6,458
|
|
|
6,278
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Purchase of minority interest
|
|
—
|
|
|
(13,757
|
)
|
||
Investments in unconsolidated affiliates
|
|
(8,089
|
)
|
|
—
|
|
||
Purchases of property and equipment
|
|
(1,061
|
)
|
|
(1,998
|
)
|
||
Proceeds from disposition of property and equipment
|
|
24
|
|
|
6
|
|
||
Net cash used in investing activities
|
|
(9,126
|
)
|
|
(15,749
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
Proceeds from issuance of common stock
|
|
3,627
|
|
|
2,287
|
|
||
Repurchase of common stock
|
|
(1,241
|
)
|
|
(860
|
)
|
||
Proceeds from line of credit borrowings
|
|
3,000
|
|
|
40,307
|
|
||
Repayments of line of credit borrowings
|
|
(3,000
|
)
|
|
(34,666
|
)
|
||
Distributions to non-controlling interest members
|
|
(126
|
)
|
|
(963
|
)
|
||
Repayments of other debt
|
|
(5
|
)
|
|
(78
|
)
|
||
Net cash provided by financing activities
|
|
2,255
|
|
|
6,027
|
|
||
EFFECT OF EXCHANGE RATE CHANGES ON CASH
|
|
(10
|
)
|
|
73
|
|
||
DECREASE IN CASH AND CASH EQUIVALENTS
|
|
(423
|
)
|
|
(3,371
|
)
|
||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
|
9,659
|
|
|
10,794
|
|
||
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
|
$
|
9,236
|
|
|
$
|
7,423
|
|
|
|
|
|
|
||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
|
|
|
|
||||
Non-cash transfers of equipment between inventory and property and equipment, net
|
|
$
|
1,019
|
|
|
$
|
824
|
|
•
|
Point of Care laboratory products including instruments, consumables, and services;
|
•
|
Point of Care imaging products including instruments, software, and services;
|
•
|
Single use pharmaceuticals, vaccines, and diagnostic tests primarily related to companion animals; and
|
•
|
Other vaccines and pharmaceuticals.
|
Year Ending December 31,
|
Revenue
|
|
|
2018 (remaining)
|
$
|
5,980
|
|
2019
|
21,682
|
|
|
2020
|
18,084
|
|
|
2021
|
14,040
|
|
|
2022
|
10,832
|
|
|
Thereafter
|
10,843
|
|
|
|
$
|
81,461
|
|
|
September 30, 2018
|
||
Equity method investment
|
$
|
5,071
|
|
Non-marketable equity security investment
|
3,018
|
|
|
|
$
|
8,089
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
(Loss) income before income taxes
|
|
$
|
(3,545
|
)
|
|
$
|
3,784
|
|
|
$
|
442
|
|
|
$
|
11,312
|
|
Total income tax (benefit) expense
|
|
(1,875
|
)
|
|
701
|
|
|
(1,941
|
)
|
|
787
|
|
||||
Effective tax rate
|
|
(52.9
|
)%
|
|
18.5
|
%
|
|
(439.1
|
)%
|
|
7.0
|
%
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net (loss) income attributable to Heska
|
$
|
(1,670
|
)
|
|
$
|
3,083
|
|
|
$
|
2,383
|
|
|
$
|
11,023
|
|
|
|
|
|
|
|
|
|
||||||||
Basic weighted-average common shares outstanding
|
7,289
|
|
|
7,139
|
|
|
7,194
|
|
|
6,985
|
|
||||
Assumed exercise of dilutive stock options and restricted shares
|
—
|
|
|
529
|
|
|
626
|
|
595
|
|
|||||
Diluted weighted-average common shares outstanding
|
7,289
|
|
|
7,668
|
|
|
7,820
|
|
|
7,580
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic (loss) earnings per share attributable to Heska
|
$
|
(0.23
|
)
|
|
$
|
0.43
|
|
|
$
|
0.33
|
|
|
$
|
1.58
|
|
Diluted (loss) earnings per share attributable to Heska
|
$
|
(0.23
|
)
|
|
$
|
0.40
|
|
|
$
|
0.30
|
|
|
$
|
1.45
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Stock options
|
675
|
|
|
27
|
|
|
190
|
|
|
132
|
|
Carrying amount, December 31, 2017
|
$
|
26,687
|
|
Foreign currency adjustments
|
(5
|
)
|
|
Carrying amount, September 30, 2018
|
$
|
26,682
|
|
|
September 30,
|
|
December 31,
|
||||
|
2018
|
|
2017
|
||||
Gross carrying amount
|
$
|
3,309
|
|
|
$
|
3,309
|
|
Accumulated amortization
|
(1,642
|
)
|
|
(1,351
|
)
|
||
Net carrying amount
|
$
|
1,667
|
|
|
$
|
1,958
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Amortization expense
|
$
|
97
|
|
|
$
|
97
|
|
|
$
|
291
|
|
|
$
|
291
|
|
Year Ending December 31,
|
|
||
2018 (remaining)
|
$
|
97
|
|
2019
|
388
|
|
|
2020
|
388
|
|
|
2021
|
384
|
|
|
2022
|
378
|
|
|
Thereafter
|
32
|
|
|
|
$
|
1,667
|
|
|
September 30,
|
|
December 31,
|
||||
|
2018
|
|
2017
|
||||
Land
|
$
|
377
|
|
|
$
|
377
|
|
Building
|
2,978
|
|
|
2,868
|
|
||
Machinery and equipment
|
39,683
|
|
|
38,432
|
|
||
Leasehold and building improvements
|
9,947
|
|
|
8,156
|
|
||
Construction in progress
|
1,179
|
|
|
3,531
|
|
||
|
54,164
|
|
|
53,364
|
|
||
Less accumulated depreciation
|
(37,880
|
)
|
|
(36,033
|
)
|
||
Total property and equipment, net
|
$
|
16,284
|
|
|
$
|
17,331
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Raw materials
|
|
$
|
16,346
|
|
|
$
|
18,465
|
|
Work in process
|
|
4,154
|
|
|
4,296
|
|
||
Finished goods
|
|
8,858
|
|
|
11,465
|
|
||
Allowance for excess or obsolete inventory
|
|
(1,719
|
)
|
|
(1,630
|
)
|
||
Total inventory, net
|
|
$
|
27,639
|
|
|
$
|
32,596
|
|
|
September 30,
2018 |
|
December 31,
2017 |
||||
Accrued settlement (see Note 13)
|
$
|
6,750
|
|
|
$
|
—
|
|
Accrued purchases
|
1,008
|
|
|
695
|
|
||
Accrued payroll and employee benefits
|
758
|
|
|
1,209
|
|
||
Accrued property taxes
|
488
|
|
|
661
|
|
||
Other
|
1,514
|
|
|
1,852
|
|
||
Total accrued liabilities
|
$
|
10,518
|
|
|
$
|
4,417
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Risk-free interest rate
|
2.80%
|
|
1.83%
|
|
2.66%
|
|
1.75%
|
Expected lives
|
4.9 years
|
|
4.9 years
|
|
4.9 years
|
|
4.9 years
|
Expected volatility
|
40%
|
|
39%
|
|
40%
|
|
41%
|
Expected dividend yield
|
0%
|
|
0%
|
|
0%
|
|
0%
|
|
Nine Months Ended September 30,
|
|
Year Ended
December 31,
|
||||||||||
|
2018
|
|
2017
|
||||||||||
|
Options |
|
Weighted Average Exercise Price
|
|
Options |
|
Weighted Average Exercise Price
|
||||||
Outstanding at beginning of period
|
630,847
|
|
|
$
|
29.312
|
|
|
829,617
|
|
|
$
|
23.203
|
|
Granted at market
|
152,200
|
|
|
$
|
75.010
|
|
|
27,050
|
|
|
$
|
99.087
|
|
Canceled
|
(19,708
|
)
|
|
$
|
53.109
|
|
|
(18,331
|
)
|
|
$
|
57.197
|
|
Exercised
|
(98,594
|
)
|
|
$
|
30.639
|
|
|
(207,489
|
)
|
|
$
|
11.520
|
|
Outstanding at end of period
|
664,745
|
|
|
$
|
38.873
|
|
|
630,847
|
|
|
$
|
29.312
|
|
Exercisable at end of period
|
414,018
|
|
|
$
|
19.378
|
|
|
456,802
|
|
|
$
|
18.316
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||
Exercise Prices
|
|
Number of
Options Outstanding at September 30, 2018 |
|
Weighted
Average
Remaining
Contractual
Life in Years
|
|
Weighted
Average
Exercise
Price
|
|
Number of
Options Exercisable at September 30, 2018 |
|
Weighted
Average
Exercise
Price
|
||||||
$ 4.40 - $ 6.90
|
|
92,535
|
|
|
1.89
|
|
$
|
5.378
|
|
|
92,535
|
|
|
$
|
5.378
|
|
$ 6.91 - $ 8.55
|
|
148,004
|
|
|
4.85
|
|
$
|
7.764
|
|
|
148,004
|
|
|
$
|
7.764
|
|
$ 8.56 - $ 39.56
|
|
112,428
|
|
|
6.33
|
|
$
|
23.164
|
|
|
105,533
|
|
|
$
|
23.242
|
|
$ 39.57 - $ 69.77
|
|
194,733
|
|
|
8.70
|
|
$
|
59.852
|
|
|
37,735
|
|
|
$
|
39.898
|
|
$ 69.78 - $ 108.25
|
|
117,045
|
|
|
8.62
|
|
$
|
84.874
|
|
|
30,211
|
|
|
$
|
80.036
|
|
$ 4.40 - $ 108.25
|
|
664,745
|
|
|
6.48
|
|
$
|
38.873
|
|
|
414,018
|
|
|
$
|
19.378
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended September 30,
|
||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Risk-free interest rate
|
2.04%
|
|
0.76%
|
|
1.39%
|
|
0.70%
|
Expected lives
|
1.1 years
|
|
1.2 years
|
|
1.2 years
|
|
1.2 years
|
Expected volatility
|
42%
|
|
45%
|
|
43%
|
|
45%
|
Expected dividend yield
|
0%
|
|
0%
|
|
0%
|
|
0%
|
|
Minimum Pension Liability
|
|
Foreign Currency Translation
|
|
Total Accumulated Other Comprehensive Income
|
||||||
Balances at December 31, 2017
|
$
|
(489
|
)
|
|
$
|
721
|
|
|
$
|
232
|
|
Current period other comprehensive loss
|
—
|
|
|
(16
|
)
|
|
(16
|
)
|
|||
Balances at September 30, 2018
|
$
|
(489
|
)
|
|
$
|
705
|
|
|
$
|
216
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Interest income
|
$
|
(66
|
)
|
|
$
|
(41
|
)
|
|
$
|
(186
|
)
|
|
$
|
(122
|
)
|
Interest expense
|
89
|
|
|
81
|
|
|
231
|
|
|
156
|
|
||||
Other (income) expense, net
|
(73
|
)
|
|
(46
|
)
|
|
(8
|
)
|
|
(220
|
)
|
||||
Total interest and other (income) expense, net
|
$
|
(50
|
)
|
|
$
|
(6
|
)
|
|
$
|
37
|
|
|
$
|
(186
|
)
|
Three Months Ended September 30, 2018
|
|
Core
Companion Animal Health |
|
Other Vaccines, Pharmaceuticals and Products
|
|
Total |
||||||
Total revenue
|
|
$
|
27,190
|
|
|
$
|
3,765
|
|
|
$
|
30,955
|
|
Operating (loss) income
|
|
(4,402
|
)
|
|
807
|
|
|
(3,595
|
)
|
|||
(Loss) income before income taxes
|
|
(4,352
|
)
|
|
807
|
|
|
(3,545
|
)
|
|||
Capital expenditures
|
|
20
|
|
|
229
|
|
|
249
|
|
|||
Depreciation and amortization
|
|
823
|
|
|
317
|
|
|
1,140
|
|
Three Months Ended September 30, 2017
|
|
Core
Companion Animal Health |
|
Other Vaccines, Pharmaceuticals and Products
|
|
Total |
||||||
Total revenue
|
|
$
|
25,578
|
|
|
$
|
4,758
|
|
|
$
|
30,336
|
|
Operating income
|
|
3,068
|
|
|
710
|
|
|
3,778
|
|
|||
Income before income taxes
|
|
3,074
|
|
|
710
|
|
|
3,784
|
|
|||
Capital expenditures
|
|
34
|
|
|
669
|
|
|
703
|
|
|||
Depreciation and amortization
|
|
935
|
|
|
259
|
|
|
1,194
|
|
Nine Months Ended September 30, 2018
|
|
Core
Companion Animal Health |
|
Other Vaccines, Pharmaceuticals and Products
|
|
Total |
||||||
Total revenue
|
|
$
|
80,652
|
|
|
$
|
12,729
|
|
|
$
|
93,381
|
|
Operating Income
|
|
384
|
|
|
95
|
|
|
479
|
|
|||
Income before income taxes
|
|
347
|
|
|
95
|
|
|
442
|
|
|||
Capital expenditures
|
|
117
|
|
|
944
|
|
|
1,061
|
|
|||
Depreciation and amortization
|
|
2,568
|
|
|
905
|
|
|
3,473
|
|
Nine Months Ended September 30, 2017
|
|
Core
Companion Animal Health |
|
Other Vaccines, Pharmaceuticals and Products
|
|
Total |
||||||
Total revenue
|
|
$
|
75,453
|
|
|
$
|
17,847
|
|
|
$
|
93,300
|
|
Operating income
|
|
6,763
|
|
|
4,363
|
|
|
11,126
|
|
|||
Income before income taxes
|
|
6,971
|
|
|
4,341
|
|
|
11,312
|
|
|||
Capital expenditures
|
|
119
|
|
|
1,879
|
|
|
1,998
|
|
|||
Depreciation and amortization
|
|
2,837
|
|
|
749
|
|
|
3,586
|
|
|
|
Core
Companion
Animal Health
|
|
Other Vaccines, Pharmaceuticals and Products
|
|
Total
|
||||||
Total assets
|
|
$
|
123,326
|
|
|
$
|
20,794
|
|
|
$
|
144,120
|
|
Net assets
|
|
87,050
|
|
|
24,551
|
|
|
111,601
|
|
|
|
Core
Companion
Animal Health
|
|
Other Vaccines, Pharmaceuticals and Products
|
|
Total
|
||||||
Total assets
|
|
$
|
111,968
|
|
|
$
|
23,819
|
|
|
$
|
135,787
|
|
Net assets
|
|
75,984
|
|
|
24,456
|
|
|
100,440
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue
|
$
|
30,955
|
|
|
$
|
30,336
|
|
|
$
|
93,381
|
|
|
$
|
93,300
|
|
Gross profit
|
14,794
|
|
|
13,553
|
|
|
41,166
|
|
|
41,691
|
|
||||
Operating expenses
|
18,389
|
|
|
9,775
|
|
|
40,687
|
|
|
30,565
|
|
||||
Operating (loss) income
|
(3,595
|
)
|
|
3,778
|
|
|
479
|
|
|
11,126
|
|
||||
Interest and other (income) expense, net
|
(50
|
)
|
|
(6
|
)
|
|
37
|
|
|
(186
|
)
|
||||
(Loss) income before income taxes
|
(3,545
|
)
|
|
3,784
|
|
|
442
|
|
|
11,312
|
|
||||
Income tax (benefit) expense
|
(1,875
|
)
|
|
701
|
|
|
(1,941
|
)
|
|
787
|
|
||||
Net (loss) income
|
(1,670
|
)
|
|
3,083
|
|
|
2,383
|
|
|
10,525
|
|
||||
Net loss attributable to non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
(498
|
)
|
||||
Net (loss) income attributable to Heska
|
$
|
(1,670
|
)
|
|
$
|
3,083
|
|
|
$
|
2,383
|
|
|
$
|
11,023
|
|
|
Three Months Ended September 30,
|
|
Change
|
|||||||||||
|
2018
|
|
2017
|
|
Dollar
Change
|
|
%
Change
|
|||||||
Point of Care Laboratory:
|
$
|
14,584
|
|
|
$
|
13,805
|
|
|
$
|
779
|
|
|
6
|
%
|
Consumables
|
11,598
|
|
|
9,773
|
|
|
1,825
|
|
|
19
|
%
|
|||
Instruments
|
2,610
|
|
|
3,456
|
|
|
(846
|
)
|
|
(24
|
)%
|
|||
Other
|
376
|
|
|
576
|
|
|
(200
|
)
|
|
(35
|
)%
|
|||
Point of Care Imaging
|
5,326
|
|
|
4,285
|
|
|
1,041
|
|
|
24
|
%
|
|||
Other CCA Revenue
|
7,280
|
|
|
7,488
|
|
|
(208
|
)
|
|
(3
|
)%
|
|||
Total CCA Revenue
|
$
|
27,190
|
|
|
$
|
25,578
|
|
|
$
|
1,612
|
|
|
6
|
%
|
Percent of total revenue
|
87.8
|
%
|
|
84.3
|
%
|
|
|
|
|
|||||
Cost of revenue
|
13,758
|
|
|
13,295
|
|
|
463
|
|
|
3
|
%
|
|||
Gross profit
|
13,432
|
|
|
12,283
|
|
|
1,149
|
|
|
9
|
%
|
|||
Operating (loss) income
|
$
|
(4,402
|
)
|
|
$
|
3,068
|
|
|
$
|
(7,470
|
)
|
|
(243
|
)%
|
|
Nine Months Ended September 30,
|
|
Change
|
|||||||||||
|
2018
|
|
2017
|
|
Dollar
Change |
|
%
Change |
|||||||
Point of Care Laboratory:
|
$
|
43,277
|
|
|
$
|
40,735
|
|
|
$
|
2,542
|
|
|
6
|
%
|
Consumables
|
33,942
|
|
|
28,933
|
|
|
5,009
|
|
|
17
|
%
|
|||
Instruments
|
8,087
|
|
|
10,250
|
|
|
(2,163
|
)
|
|
(21
|
)%
|
|||
Other
|
1,248
|
|
|
1,552
|
|
|
(304
|
)
|
|
(20
|
)%
|
|||
Point of Care Imaging
|
15,759
|
|
|
13,643
|
|
|
2,116
|
|
|
16
|
%
|
|||
Other CCA Revenue
|
21,616
|
|
|
21,075
|
|
|
541
|
|
|
3
|
%
|
|||
Total CCA Revenue
|
$
|
80,652
|
|
|
$
|
75,453
|
|
|
$
|
5,199
|
|
|
7
|
%
|
Percent of total revenue
|
86.4
|
%
|
|
80.9
|
%
|
|
|
|
|
|||||
Cost of revenue
|
41,294
|
|
|
39,702
|
|
|
1,592
|
|
|
4
|
%
|
|||
Gross profit
|
39,358
|
|
|
35,751
|
|
|
3,607
|
|
|
10
|
%
|
|||
Operating (loss) income
|
$
|
384
|
|
|
$
|
6,763
|
|
|
$
|
(6,379
|
)
|
|
(94
|
)%
|
|
Three Months Ended September 30,
|
|
Change
|
|||||||||||
|
2018
|
|
2017
|
|
Dollar
Change
|
|
%
Change
|
|||||||
Revenue
|
$
|
3,765
|
|
|
$
|
4,758
|
|
|
$
|
(993
|
)
|
|
(21
|
)%
|
Percent of total revenue
|
12.2
|
%
|
|
15.7
|
%
|
|
|
|
|
|||||
Cost of revenue
|
2,402
|
|
|
3,488
|
|
|
(1,086
|
)
|
|
(31
|
)%
|
|||
Gross profit
|
1,363
|
|
|
1,270
|
|
|
93
|
|
|
7
|
%
|
|||
Operating income
|
$
|
807
|
|
|
$
|
710
|
|
|
$
|
97
|
|
|
14
|
%
|
|
Nine Months Ended September 30,
|
|
Change
|
|||||||||||
|
2018
|
|
2017
|
|
Dollar
Change |
|
%
Change |
|||||||
Revenue
|
$
|
12,729
|
|
|
$
|
17,847
|
|
|
$
|
(5,118
|
)
|
|
(29
|
)%
|
Percent of total revenue
|
13.6
|
%
|
|
19.1
|
%
|
|
|
|
|
|||||
Cost of revenue
|
10,921
|
|
|
11,907
|
|
|
(986
|
)
|
|
(8
|
)%
|
|||
Gross profit
|
1,808
|
|
|
5,940
|
|
|
(4,132
|
)
|
|
(70
|
)%
|
|||
Operating income
|
$
|
95
|
|
|
$
|
4,363
|
|
|
$
|
(4,268
|
)
|
|
(98
|
)%
|
|
Three Months
Ended September 30, 2018
|
|
Nine Months
Ended September 30, 2018
|
||||
|
($ in thousands, except per share data)
|
||||||
Adjusted operating expenses
|
$
|
11,338
|
|
|
$
|
33,512
|
|
|
|
|
|
||||
Adjusted operating income
|
3,456
|
|
|
7,654
|
|
||
Interest and other (income) expense, net
|
(50
|
)
|
|
37
|
|
||
Adjusted income before income taxes
|
3,506
|
|
|
7,617
|
|
||
Adjusted total income tax expense
|
125
|
|
|
96
|
|
||
Adjusted net income
|
3,381
|
|
|
7,521
|
|
||
|
|
|
|
||||
Adjusted earnings per share
|
|
|
|
||||
Basic
|
$
|
0.46
|
|
|
$
|
1.05
|
|
Diluted
|
$
|
0.43
|
|
|
$
|
0.96
|
|
|
|
|
|
||||
Shares used in the calculation of adjusted earnings per share:
|
|
|
|
||||
Weighted average outstanding shares used to compute adjusted basic earnings per share
|
7,289
|
|
|
7,194
|
|
||
Weighted average outstanding shares used to compute adjusted diluted earnings per share
|
7,916
|
|
|
7,820
|
|
•
|
During the three months ended September 30, 2018, we recorded a one-time settlement charge of $6.75 million and approximately $0.1 million in related legal fees in general and administrative expenses, relating to the pending settlement of the Shaun Fauley complaint filed on March 12, 2015. See Item 1, Note 13 (Commitments and Contingencies) to the unaudited Condensed Consolidated Financial Statements for further discussion of the settlement.
|
•
|
Other one-time costs were approximately $0.2 million for the three months ended September 30, 2018 and $0.3 million for the nine months ended September 30, 2018.
|
|
Three Months Ended September 30, 2018
|
||||||||||||||||||||||
|
Operating expenses
|
|
Operating (loss) income
|
|
Income tax (benefit) expense
|
|
Net (loss) income
|
|
Basic earnings (loss) per share
|
|
Diluted earnings (loss) per share
|
||||||||||||
|
($ in thousands, except per share data)
|
||||||||||||||||||||||
Reported - GAAP
|
$
|
18,389
|
|
|
$
|
(3,595
|
)
|
|
$
|
(1,875
|
)
|
|
$
|
(1,670
|
)
|
|
$
|
(0.23
|
)
|
|
$
|
(0.23
|
)
|
Litigation Provision and Other One-Time Costs
|
7,051
|
|
|
7,051
|
|
|
2,000
|
|
|
5,051
|
|
|
0.69
|
|
|
0.66
|
|
||||||
Adjusted Non-GAAP
|
$
|
11,338
|
|
|
$
|
3,456
|
|
|
$
|
125
|
|
|
$
|
3,381
|
|
|
$
|
0.46
|
|
|
$
|
0.43
|
|
|
Nine Months Ended September 30, 2018
|
||||||||||||||||||||||
|
Operating expenses
|
|
Operating income
|
|
Income tax (benefit) expense
|
|
Net income
|
|
Basic earnings per share
|
|
Diluted earnings per share
|
||||||||||||
|
($ in thousands, except per share data)
|
||||||||||||||||||||||
Reported - GAAP
|
$
|
40,687
|
|
|
$
|
479
|
|
|
$
|
(1,941
|
)
|
|
$
|
2,383
|
|
|
$
|
0.33
|
|
|
$
|
0.30
|
|
Litigation Provision and Other One-Time Costs
|
7,175
|
|
|
7,175
|
|
|
2,037
|
|
|
5,138
|
|
|
0.72
|
|
|
0.66
|
|
||||||
Adjusted Non-GAAP
|
$
|
33,512
|
|
|
$
|
7,654
|
|
|
$
|
96
|
|
|
$
|
7,521
|
|
|
$
|
1.05
|
|
|
$
|
0.96
|
|
|
Nine Months Ended September 30,
|
|
Change
|
|||||||||||
|
2018
|
|
2017
|
|
Dollar
Change |
|
%
Change |
|||||||
Net cash provided by operating activities
|
$
|
6,458
|
|
|
$
|
6,278
|
|
|
$
|
180
|
|
|
3
|
%
|
Net cash used in investing activities
|
(9,126
|
)
|
|
(15,749
|
)
|
|
6,623
|
|
|
(42
|
)%
|
|||
Net cash provided by financing activities
|
2,255
|
|
|
6,027
|
|
|
(3,772
|
)
|
|
(63
|
)%
|
|||
Effect of currency translation on cash
|
(10
|
)
|
|
73
|
|
|
(83
|
)
|
|
(114
|
)%
|
|||
Decrease in cash and cash equivalents
|
(423
|
)
|
|
(3,371
|
)
|
|
2,948
|
|
|
(87
|
)%
|
|||
Cash and cash equivalents, beginning of the period
|
9,659
|
|
|
10,794
|
|
|
(1,135
|
)
|
|
(11
|
)%
|
|||
Cash and cash equivalents, end of the period
|
$
|
9,236
|
|
|
$
|
7,423
|
|
|
$
|
1,813
|
|
|
24
|
%
|
Item 1A.
|
Risk Factors
|
|
Exhibit Number
|
|
Notes
|
|
Description of Document
|
|
|
|
|
1997 Stock Incentive Plan, as amended and restated.
|
|
|
|
|
|
Restricted Stock Agreement and Notice of Stock Option Grant for grants issued to Jason D. Aroesty on July 25, 2018.
|
|
|
|
|
|
Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.
|
|
|
|
|
|
Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.
|
|
|
|
*
|
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101.INS
|
|
|
|
XBRL Instance Document.
|
|
101.SCH
|
|
|
|
XBRL Taxonomy Extension Schema Document.
|
|
101.CAL
|
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
101.DEF
|
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
101.PRE
|
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
101.LAB
|
|
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
Notes
|
|
*
|
Furnished and not filed herewith.
|
|
HESKA CORPORATION
|
|
|
|
By:
/s/ KEVIN S. WILSON
Kevin S. Wilson
Chief Executive Officer and President
(Principal Executive Officer)
|
|
By:
/s/ CATHERINE GRASSMAN
Catherine Grassman
Vice President, Chief Accounting Officer and Controller
(Principal Financial and Accounting Officer)
|
2.1
|
C
OMMITTEE
C
OMPOSITION
.
The Plan shall be administered by the Committee. The Committee shall consist exclusively of two or more directors of the Company, who shall be appointed by the Board. In addition, the composition of the Committee shall satisfy:
|
(a)
|
Such requirements as the Securities and Exchange Commission may establish for administrators acting under plans intended to qualify for exemption under Rule 16b-3 (or its successor) under the Exchange Act; and
|
(b)
|
Such requirements as the Internal Revenue Service may establish for outside directors acting under plans intended to qualify for exemption under section 162(m)(4)(C) of the Code.
|
2.2
|
C
OMMITTEE
R
ESPONSIBILITIES
.
The Committee shall (a) select the Employees, Outside Directors and Consultants who are to receive Awards under the Plan, (b) determine the type,
|
3.1
|
B
ASIC
L
IMITATION
.
Common Shares issued pursuant to the Plan may be authorized but unissued shares or treasury shares, or shares reacquired by the Company in any manner. The number of shares stated in this Section 3.1 as available for the grant of Awards is subject to adjustment in accordance with Article 9. As of March 7, 2018, the aggregate number of Common Shares cumulatively authorized by the Company’s stockholders for issuance as Options and Restricted Shares under the Plan was 2,635,130. Of that total, as of March 7, 2018, Previously Issued Awards have been issued covering 2,578,093 Common Shares, leaving 57,037 Common Shares for the issuance of Options and Restricted Shares. With the March 7, 2018 amendment and restatement of the Plan, the Company’s Board and stockholders have approved an increase of 250,000 in the aggregate number of Common Shares available for Awards under the Plan, to a new total of 2,885,130. Notwithstanding the foregoing, the additional 250,000 Common Shares the Company’s Board and stockholders approved for awards under the Plan as of March 7, 2018 will not be available for issuance with respect to any Award granted prior to November 2, 2017.
|
3.2
|
A
DDITIONAL
S
HARES
.
Any shares of Common Stock subject to an Award that is canceled, forfeited or expires prior to exercise or realization, either in full or in part, shall again become available for issuance under the Plan as ISOs or any type of Award. Notwithstanding anything to the contrary contained herein: shares subject to an Award under the Plan shall not again be made available for issuance or delivery under the Plan if such shares are (a) shares tendered in payment of an Option, or (b) shares delivered or withheld by the Company to satisfy any tax withholding obligation.
|
4.1
|
N
ONSTATUTORY
S
TOCK
O
PTIONS AND
R
ESTRICTED
S
HARES
.
Only Employees, Outside Directors and Consultants shall be eligible for the grant of NQOs and Restricted Shares.
|
4.2
|
I
NCENTIVE
S
TOCK
O
PTIONS
.
Only Employees who are common-law employees of the Company, a Parent or a Subsidiary shall be eligible for the grant of ISOs. In addition, an Employee who owns more than 10% of the total combined voting power of all classes of outstanding stock of the Company or any of its Parents or Subsidiaries shall not be eligible for the grant of an ISO unless the requirements set forth in section 422(c)(6) of the Code are satisfied.
|
5.1
|
S
TOCK
O
PTION
A
GREEMENT
.
Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement between the Optionee and the Company. Such Option shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The Stock Option Agreement shall specify whether the Option is an ISO or an NQO. The provisions of the various Stock Option Agreements entered into under the Plan need not be identical. Options may be granted in consideration of a cash payment or in consideration of a reduction in the Optionee’s other compensation.
|
5.2
|
N
UMBER OF
S
HARES
.
Each Stock Option Agreement shall specify the number of Common Shares subject to the Option and shall provide for the adjustment of such number in accordance with Article 9. Options granted to any Optionee in a single fiscal year of the Company shall not cover more than 50,000 Common Shares, except that Options granted to a new Employee in the fiscal year of the Company in which his or her service as an Employee first commences shall not cover more than 100,000 Common Shares. The limitations set forth in the preceding sentence shall be subject to adjustment in accordance with Article 9.
|
5.3
|
E
XERCISE
P
RICE
.
Each Stock Option Agreement shall specify the Exercise Price; provided that the Exercise Price under an ISO shall in no event be less than 100% of the Fair Market Value of a Common Share on the date of grant and the Exercise Price under an NQO shall in no event be less than 85% of the Fair Market Value of a Common Share on the date of grant. In the case of an NQO, a Stock Option Agreement may specify an Exercise Price that varies in accordance with a predetermined formula while the NQO is outstanding.
|
5.4
|
E
XERCISABILITY AND
T
ERM
.
Each Stock Option Agreement shall specify the date when all or any installment of the Option is to become exercisable. The Stock Option Agreement shall also specify the term of the Option; provided that the term of an ISO shall in no event exceed 10 years from the date of grant. A Stock Option Agreement may provide for accelerated exercisability in the event of the Optionee’s death, disability or retirement or other events and may provide for expiration prior to the end of its term in the event of the termination of the Optionee’s service. NQOs may also be awarded in combination with Restricted Shares, and such an Award may provide that the NQOs will not be exercisable unless the related Restricted Shares are forfeited.
|
5.5
|
E
FFECT OF
C
HANGE IN
C
ONTROL
.
The Committee may determine, at the time of granting an Option or thereafter, that such Option shall become exercisable as to all or part of the Common Shares subject to such Option in the event that a Change in Control occurs with respect to the Company, provided, however, that in the case of an ISO, the acceleration of exercisability shall not occur without the Optionee’s written consent.
|
5.6
|
M
ODIFICATION OR
A
SSUMPTION OF
O
PTIONS
.
The Committee may modify, extend or assume outstanding options or may accept the cancellation of outstanding options (whether granted by the Company or by another issuer) in return for the grant of new options for the same or a different number of shares and at the same or a different exercise price. The foregoing notwithstanding, no modification of an Option shall, without the
|
6.1
|
G
ENERAL
R
ULE
.
The entire Exercise Price of Common Shares issued upon exercise of Options shall be payable in cash or cash equivalents at the time when such Common Shares are purchased, except as follows:
|
(a)
|
In the case of an ISO granted under the Plan, payment shall be made only pursuant to the express provisions of the applicable Stock Option Agreement. The Stock Option Agreement may specify that payment may be made in any form(s) described in this Article 6.
|
(b)
|
In the case of an NQO, the Committee may at any time accept payment in any form(s) described in this Article 6.
|
6.2
|
S
URRENDER OF
S
TOCK
.
To the extent that this Section 6.2 is applicable, all or any part of the Exercise Price may be paid by surrendering Common Shares that are already owned by the Optionee. Such Common Shares shall be valued at their Fair Market Value on the date when the new Common Shares are purchased under the Plan. The Optionee shall not surrender Common Shares in payment of the Exercise Price if such action could cause the Company to recognize additional compensation expense with respect to the Option for financial reporting purposes under GAAP accounting at the time of such proposed surrender.
|
6.3
|
E
XERCISE
/S
ALE
.
To the extent that this Section 6.3 is applicable, all or any part of the Exercise Price may be paid by delivering (on a form prescribed by the Company) an irrevocable direction to a securities broker approved by the Company to sell all or part of the Common Shares being purchased under the Plan and to deliver all or part of the sales proceeds to the Company.
|
6.6
|
O
THER
F
ORMS OF
P
AYMENT
.
To the extent that this Section 6.6 is applicable, all or any part of the Exercise Price may be paid in any other form that is consistent with applicable laws, regulations and rules.
|
8.1
|
T
IME
, A
MOUNT AND
F
ORM OF
A
WARDS
.
Awards under the Plan may be granted in the form of Restricted Shares. Restricted Shares may also be awarded in combination with NQOs, and such an Award may provide that the Restricted Shares will be forfeited in the event that the related NQOs are exercised. The maximum aggregate number of Common Shares that may be granted in the form of Restricted Shares in any one calendar year to any one Participant is 45,000, except a new Employee may receive a grant of up to 75,000 Restricted Shares in the fiscal year of the Company in which his or her service with the Company begins.
|
8.2
|
P
AYMENT FOR
A
WARDS
.
To the extent that an Award is granted in the form of newly issued Restricted Shares, the Award recipient, as a condition to the grant of such Award, shall be required to pay the Company in cash, cash equivalents or any other form of legal consideration acceptable to the Company, including but not limited to future services, an amount equal to the par value of such Restricted Shares. To the extent that an Award is granted in the form of Restricted Shares from the Company’s treasury, no cash consideration shall be required of the Award recipients.
|
8.3
|
V
ESTING
C
ONDITIONS
.
Each Award of Restricted Shares shall be subject to vesting. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Stock Award Agreement. A Stock Award Agreement may provide for accelerated vesting in the event of the Participant’s death, disability or retirement or other events. Notwithstanding any other provision of the Plan to the contrary, the Committee may determine, at the time of granting Restricted Shares or thereafter, that all or part of such Restricted Shares shall become vested in the event that a Change in Control occurs with respect to the Company. Solely with respect to Awards granted in 2018 or later, and notwithstanding any other provision of the Plan to the contrary, the Committee may determine, at the time of granting Restricted Shares or thereafter, that all or part of such Restricted Shares shall become vested in the event of the Participant’s death or disability.
|
8.4
|
V
OTING AND
D
IVIDEND
R
IGHTS
.
Unless otherwise provided in the Stock Award Agreement, the holder of Restricted Shares awarded under the Plan shall have the same voting, dividend and other rights as the Company’s other stockholders. Without limitation, a Stock Award Agreement may require that the holders of Restricted Shares invest any cash dividends received in additional Restricted Shares (in which case such additional Restricted Shares
|
(a)
|
In General
. For purposes of qualifying grants of Restricted Shares as “performance-based compensation” under Code Section 162(m), the Committee, in its discretion, may make Restricted Shares subject to vesting based on the achievement of performance goals, in which case the Committee will specify in writing, by resolution or otherwise, the Participants eligible to receive such an Award (which may be expressed in terms of a class of individuals) and the performance goals applicable to such Awards within 90 days after the commencement of the period to which the performance goals relate, or such earlier time as required to comply with
|
(b)
|
Performance Goals
. Unless and until the Committee proposes for stockholder vote and the stockholders approve a change in the general performance measures applicable to Awards, the performance goals upon which the payment or vesting of an Award that is intended to qualify as performance based compensation are limited to the following Performance Measures:
|
(1)
|
operating income or operating profit (including but not limited to operating income and any affiliated growth measure);
|
(2)
|
net earnings or net income (before or after taxes, including but not limited to deferred taxes, and any affiliated growth measure);
|
(3)
|
basic or diluted earnings per share (before or after taxes, including but not limited to deferred taxes, and any affiliated growth measure);
|
(4)
|
revenues (including but not limited to revenue, gross revenue, net revenue, and any affiliated growth measure);
|
(5)
|
gross profit or gross profit growth;
|
(6)
|
return on assets, capital, invested capital, equity or sales;
|
(7)
|
cash flow (including, but not limited to, operating cash flow, free cash flow, and cash flow return on capital);
|
(8)
|
earnings before or after taxes, interest, depreciation and/or amortization (including but not limited to changes in this measure);
|
(9)
|
improvements or changes in capital structure (including but not limited to debt balances or debt issuance);
|
(10)
|
budget management;
|
(11)
|
productivity targets;
|
(12)
|
economic value added or other value added measurements;
|
(13)
|
share price (including, but not limited to, growth measures and total shareholder return);
|
(14)
|
expense targets;
|
(15)
|
margins (including but not limited to gross or operating margins);
|
(16)
|
efficiency measurements (including but not limited to availability measurements, call wait times, call, meeting, shipping or other volume measurements, turnaround times and error rates);
|
(17)
|
working capital targets (including but not limited to items reported on the Company’s balance sheet and time-based or similar measures such as days inventory, days receivable and days payable);
|
(18)
|
equity or market value measures;
|
(19)
|
enterprise or adjusted market value measures;
|
(20)
|
safety record;
|
(21)
|
completion of business acquisition, divestment or expansion;
|
(22)
|
book value or changes in book value (including but not limited to tangible book value and net asset measures);
|
(23)
|
assets or changes in assets;
|
(24)
|
cash position or changes in cash position;
|
(25)
|
employee retention or recruiting measures;
|
(26)
|
milestones related to filings with government entities or related approvals (including but not limited to filings with the Securities and Exchange Commission which may require stockholder approval);
|
(27)
|
changes in location or the opening or closing of facilities;
|
(28)
|
contract or other development of relationship with identified suppliers, distributors or other business partners; and
|
(29)
|
new product development (including but not limited to third-party collaborations or contracts, and with milestones that may include but are not limited to contract execution, proof of concept, regulatory approval, product launch and targets such as unit volume and revenue following product launch).
|
8.6
|
M
INIMUM
V
ESTING
R
EQUIREMENT
.
The minimum period for Restricted Shares granted under the Plan to vest shall be one year.
|
9.1
|
A
DJUSTMENTS
.
In the event of a subdivision of the outstanding Common Shares, a declaration of a dividend payable in Common Shares, a declaration of a dividend payable in a form other than Common Shares in an amount that has a material effect on the price of Common Shares, a combination or consolidation of the outstanding Common Shares (by reclassification or otherwise) into a lesser number of Common Shares, a recapitalization, a spin-off or a similar occurrence, the Committee shall make such adjustments as it, in its sole discretion, deems appropriate in one or more of (a) the number of Options and Restricted Shares available for future Awards under Article 3, (b) the limitations set forth in Section 5.2 and Section 8.1, (c) the number of Common Shares covered by each outstanding Option or
|
9.2
|
D
ISSOLUTION OR
L
IQUIDATION
.
To the extent not previously exercised, Options shall terminate immediately prior to the dissolution or liquidation of the Company.
|
9.3
|
R
EORGANIZATIONS
.
In the event that the Company is a party to a merger or other reorganization, outstanding Options and Restricted Shares shall be subject to the agreement of merger or reorganization. Such agreement may provide, without limitation, for the continuation of outstanding Awards by the Company (if the Company is a surviving corporation), for their assumption by the surviving corporation or its parent or subsidiary, for the substitution by the surviving corporation or its parent or subsidiary of its own awards for such Awards, for accelerated vesting and accelerated expiration, or for settlement in cash or cash equivalents.
|
EXECUTIVE
|
|
HESKA CORPORATION
|
|
|
|
a Delaware Corporation
|
|
/s/ Jason Aroesty
|
|
/s/ Jason Napolitano
|
|
|
|
Title: Chief Operating Officer, Chief Strategist and Secretary
|
|
|
|
|
|
OPTIONEE:
|
HESKA CORPORATION, a Delaware corporation
|
|
|
|
|
Signature:
/s/ Jason Aroesty
Jason Aroesty
|
By:
/s/ Jason Napolitano
Title: Chief Operating Officer,
Chief Strategist and Secretary
|
|
Tax Treatment
|
This option is intended to be an incentive stock option under section 422 of the Internal Revenue Code or a nonstatutory option, as provided in the Notice of Stock Option Grant.
|
•
|
Your service as an Employee, Consultant or Outside Director of the Company or a Subsidiary terminates because of death, or
|
•
|
The Company is a party to a merger or other reorganization while you are an Employee or Consultant of the Company or a Subsidiary, this option is not continued by the Company and is not assumed by the surviving corporation or its parent, and the surviving corporation or its parent does not substitute its own option for this option, or
|
•
|
The Company is subject to a "Change in Control" while you are an Employee or Consultant of the Company or a Subsidiary and, within 12 months after the Change in Control, the surviving entity terminates your service without your consent and without Cause, as defined below. If the surviving entity demotes you to a lower position, materially reduces your authority or responsibilities, materially reduces your total compensation or announces its intention to relocate your principal place of work by more than 20 miles, then that action will be treated as a termination of your service.
|
•
|
"Cause" shall mean (i) your failure to perform your assigned duties or responsibilities as an Employee or Consultant of the Company or a Subsidiary (other than a failure resulting from total and permanent disability, as discussed below) after notice thereof from the Company describing your failure to perform such duties or responsibilities; (ii) your material breach of any confidentiality agreement or invention assignment agreement between you and the Company or a Subsidiary; (iii) your engaging in any act of
|
Term
|
This option expires in any event at the close of business at Company headquarters on the day before the 10th anniversary of the Date of Grant, as shown in the Notice of Stock Option Grant. (It will expire earlier if your service terminates, as described below.)
|
Death
|
If your service as an Employee, Consultant or Outside Director of the Company or a Subsidiary terminates because of your death, then this option will expire at the close of business at Company headquarters on the date 12 months after the date of death.
|
Disability
|
If your service as an Employee, Consultant or Outside Director of the Company or a Subsidiary terminates because of your total and permanent disability, then this option will expire at the close of business at Company headquarters on the date 12 months after your termination date.
|
Leaves of Absence
|
Vesting of this option shall be suspended during any unpaid leave of absence unless continued vesting is required by the terms of the leave or by applicable law.
|
Notice of Exercise
|
When you wish to exercise this option, you must notify the Company by filing the proper "Notice of Exercise" form at the address given on the form. Your notice must specify how many shares you wish to purchase. The exercise will be effective when the Company receives the Notice of Exercise with the option exercise payment described herein.
|
Form of Payment
|
When you submit your notice of exercise, you must include payment of the option exercise price for the shares you are purchasing. Payment may be made in one (or a combination of two or more) of the following forms:
|
Transfer of Option
|
Prior to your death, only you may exercise this option. You cannot transfer or assign this option. For instance, you may not sell this option or use it as security for a loan. You may, however, dispose of this option in your will, by the laws of descent and distribution or through a beneficiary designation.
|
Retention Rights
|
Neither your option nor this Agreement gives you the right to be employed or otherwise retained by the Company or a Subsidiary in any capacity. The Company or a Subsidiary reserves the right to terminate your service at any time, with or without cause.
|
Stockholder Rights
|
You, or your estate or heirs, have no rights as a stockholder of the Company until you have exercised this option by giving the required notice to the Company and paying the exercise price.
|
Applicable Law
|
This Agreement will be interpreted and enforced under the laws of the State of Colorado (without giving effect to its conflict of laws provisions).
|
OPTIONEE:
|
HESKA CORPORATION, a Delaware corporation
|
|
|
Signature:
/s/ Jason Aroesty
Jason Aroesty
|
By:
/s/ Jason Napolitano
Title: Chief Operating Officer,
Chief Strategist and Secretary
|
Tax Treatment
|
This option is intended to be an incentive stock option under section 422 of the Internal Revenue Code or a nonstatutory option, as provided in the Notice of Stock Option Grant.
|
•
|
Your service as an Employee, Consultant or Outside Director of the Company or a Subsidiary terminates because of death, or
|
•
|
The Company is a party to a merger or other reorganization while you are an Employee or Consultant of the Company or a Subsidiary, this option is not continued by the Company and is not assumed by the surviving corporation or its parent, and the surviving corporation or its parent does not substitute its own option for this option, or
|
•
|
The Company is subject to a "Change in Control" while you are an Employee or Consultant of the Company or a Subsidiary and, within 12 months after the Change in Control, the surviving entity terminates your service without your consent and without Cause, as defined below. If the surviving entity demotes you to a lower position, materially reduces your authority or responsibilities, materially reduces your total compensation or announces its intention to relocate your principal place of work by more than 20 miles, then that action will be treated as a termination of your service.
|
•
|
"Cause" shall mean (i) your failure to perform your assigned duties or responsibilities as an Employee or Consultant of the Company or a Subsidiary (other than a failure resulting from total and permanent disability, as discussed below) after notice thereof from the Company describing your failure to perform such duties or responsibilities; (ii) your material breach of any confidentiality agreement or invention
|
Term
|
This option expires in any event at the close of business at Company headquarters on the day before the 10th anniversary of the Date of Grant, as shown in the Notice of Stock Option Grant. (It will expire earlier if your service terminates, as described below.)
|
Death
|
If your service as an Employee, Consultant or Outside Director of the Company or a Subsidiary terminates because of your death, then this option will expire at the close of business at Company headquarters on the date 12 months after the date of death.
|
Disability
|
If your service as an Employee, Consultant or Outside Director of the Company or a Subsidiary terminates because of your total and permanent disability, then this option will expire at the close of business at Company headquarters on the date 12 months after your termination date.
|
Leaves of Absence
|
Vesting of this option shall be suspended during any unpaid leave of absence unless continued vesting is required by the terms of the leave or by applicable law.
|
Notice of Exercise
|
When you wish to exercise this option, you must notify the Company by filing the proper "Notice of Exercise" form at the address given on the form. Your notice must specify how many shares you wish to purchase. The exercise will be effective when the Company receives the Notice of Exercise with the option exercise payment described herein.
|
Form of Payment
|
When you submit your notice of exercise, you must include payment of the option exercise price for the shares you are purchasing. Payment may be made in one (or a combination of two or more) of the following forms:
|
Transfer of Option
|
Prior to your death, only you may exercise this option. You cannot transfer or assign this option. For instance, you may not sell this option or use it as security for a loan. You may, however, dispose of this option in your will, by the laws of descent and distribution or through a beneficiary designation.
|
Retention Rights
|
Neither your option nor this Agreement gives you the right to be employed or otherwise retained by the Company or a Subsidiary in any capacity. The Company or a Subsidiary reserves the right to terminate your service at any time, with or without cause.
|
Stockholder Rights
|
You, or your estate or heirs, have no rights as a stockholder of the Company until you have exercised this option by giving the required notice to the Company and paying the exercise price.
|
Applicable Law
|
This Agreement will be interpreted and enforced under the laws of the State of Colorado (without giving effect to its conflict of laws provisions).
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Heska Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated: November 7, 2018
|
/s/ Kevin S. Wilson
|
|
KEVIN S. WILSON
|
|
Chief Executive Officer and President
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Heska Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated: November 7, 2018
|
/s/ Catherine Grassman
|
|
CATHERINE GRASSMAN
|
|
Vice President, Chief Accounting Officer and Controller
|
|
(Principal Financial Officer)
|
Dated: November 7, 2018
|
By:
|
/s/ Kevin S. Wilson
|
|
Name:
|
KEVIN S. WILSON
|
|
Title:
|
Chief Executive Officer and President
|
Dated: November 7, 2018
|
By:
|
/s/ Catherine Grassman
|
|
Name:
|
CATHERINE GRASSMAN
|
|
Title:
|
Vice President, Chief Accounting Officer and Controller
|