Document

DEF 14A 1 proxydef14a2023.htm DEF 14A Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES

EXCHANGE ACT OF 1934 (Amendment No. )

Filed by the Registrant [X] Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement

[_] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

[X] Definitive Proxy Statement

[_] Definitive Additional Materials

[_] Soliciting Material Pursuant to §240 Rule 14a-12

HESKA CORPORATION

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check all boxes that apply):

[X] No fee required.

[_] Fee paid previously with preliminary materials.

[_] Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

March 21, 2023

Dear Heska Corporation Stockholder:

I am pleased to invite you to attend the 2023 Annual Meeting of Stockholders of Heska Corporation. The meeting is to be held on Wednesday, May 3, 2023, at 9:00 a.m., MDT, virtually. The meeting is online only, with no physical meeting location. You will be able to attend the meeting and vote your shares by logging on to http://meetnow.global/M2CPXHH.

We encourage you to indicate your voting preferences as soon as possible as described in the enclosed proxy statement if you do not plan to attend the Annual Meeting virtually.

Details regarding the Annual Meeting and the business to be conducted are more fully described in the accompanying Notice of 2023 Annual Meeting and Proxy Statement. This Notice and all proxy materials in connection with this Annual Meeting are available at https://materials.proxyvote.com/42805E.

Your vote is important, so please act at your first opportunity. Whether or not you plan to virtually attend the Annual Meeting, I hope you will indicate your voting preferences as soon as possible. You may vote by proxy or virtually at the Annual Meeting. Please review the instructions in the Proxy Statement and on the proxy card regarding your voting options.

Thank you for your ongoing support of, and continued interest in, Heska Corporation.

Sincerely,

Scott W. Humphrey

Chair of the Board of Directors,

Heska Corporation

Loveland, Colorado


YOUR VOTE IS IMPORTANT ___________________ In order to ensure your representation at the Annual Meeting if you will not attend virtually, please follow the corresponding instructions on any enclosed proxy card to indicate your voting preferences.


NOTICE OF 2023 ANNUAL MEETING OF STOCKHOLDERS

Important Notice Regarding the Availability of Proxy Materials for the 2023 Annual Meeting of Stockholders of Heska Corporation to be held on May 3, 2023. The Proxy Statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 are available at https://materials.proxyvote.com/42805E.

TIME

9:00 a.m., MDT, on Wednesday, May 3, 2023

PLACE

Virtually, at http://meetnow.global/M2CPXHH

ITEMS OF BUSINESS

To elect the eight Directors named in this proxy statement to a one-year term.

To ratify the appointment of Grant Thornton LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023.

To amend the Heska Corporation Equity Incentive Plan to increase the number of shares authorized for issuance thereunder by 100,000 shares.

To approve our executive compensation in a non-binding advisory vote.

To transact such other business as may properly come before the meeting or any adjournment or postponement thereof.

RECORD DATE

You can vote if you were an eligible stockholder at the close of business on March 6, 2023.

VOTING BY PROXY

If you do not plan to attend the Annual Meeting, please submit a proxy card appointing a proxy as soon as possible so that your shares can be voted at the Annual Meeting in accordance with your instructions. For specific instructions on voting, please refer to the instructions on the proxy card or the enclosed materials.

Please see pages 1-6 for additional information about how to access, vote, examine the list of stockholders and submit questions during the meeting. A list of stockholders entitled to vote at the Annual Meeting will be available during the meeting at http://meetnow.global/M2CPXHH.


March 21, 2023			By Order of the Board of Directors

			Christopher D. Sveen Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary, Heska Corporation; President, Diamond Animal Health

TABLE OF CONTENTS


PROXY STATEMENT			1
ABOUT THE ANNUAL MEETING			1
QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE 2023 ANNUAL MEETING			1
BOARD STRUCTURE AND COMMITTEES			7
DIRECTOR COMPENSATION			14
PROPOSAL NO. 1			16
PROPOSAL NO. 2			19
PROPOSAL NO. 3			20
PROPOSAL NO. 4			27
EXECUTIVE COMPENSATION			28
COMPENSATION COMMITTEE REPORT			39
PAY RATIO DISCLOSURE			46
PAY VERSUS PERFORMANCE DISCLOSURE			47
AUDITOR FEES AND SERVICES			51
REPORT OF OUR AUDIT COMMITTEE			52
OWNERSHIP OF SECURITIES - COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			54
SIGNIFICANT RELATIONSHIPS AND TRANSACTIONS WITH DIRECTORS, OFFICERS OR PRINCIPAL STOCKHOLDERS			55
OTHER MATTERS			56
OTHER INFORMATION			56
ANNUAL REPORT ON FORM 10-K			57
APPENDIX A: Heska Corporation Equity Incentive Plan (As Amended)			A-1

-i-

PROXY STATEMENT

ABOUT THE ANNUAL MEETING

This proxy statement is being furnished to holders of all classes of common stock, $0.01 par value per share, of Heska Corporation ("Heska" or the "Company"). Proxies are being solicited on behalf of the Board of Directors of the Company (the "Board") to be used at the Annual Meeting of Stockholders (the "Annual Meeting") to be held virtually on Wednesday, May 3, 2023, at 9:00 a.m., MDT. Stockholders may participate online by logging onto http://meetnow.global/M2CPXHH, where you will be able to listen to the meeting live, ask questions, and vote online. To participate in the Annual Meeting, you will need the 15-digit control number included in the Notice of Internet Availability of Proxy Materials or on the proxy card that you request and receive by mail or email. There will be no physical meeting location.

At the Annual Meeting, you will be asked to (1) elect the eight Directors named in this proxy statement to a one-year term; (2) ratify the appointment of Grant Thornton LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023; (3) approve an amendment of the Heska Corporation Equity Incentive Plan to increase the number of shares authorized for issuance thereunder by 100,000 shares (the "Stock Plan Amendment"); and (4) approve our executive compensation in a non-binding advisory vote.

This proxy statement and the accompanying proxy card are being made available to our stockholders of record entitled to vote at the Annual Meeting on or about March 21, 2023.

We are furnishing proxy materials to most of our stockholders via the Internet by mailing a Notice of Internet Availability of Proxy Materials, instead of mailing copies of those materials. The Notice of Internet Availability of Proxy Materials directs stockholders to a website where they can access our proxy materials, including our proxy statement and our Annual Report on Form 10-K, and view instructions on how to vote via the Internet, mobile device, or by telephone. The Notice of Internet Availability of Proxy Materials also includes information on how to attend the meeting virtually and vote online. If you received a Notice of Internet Availability of Proxy Materials and would prefer to receive a paper copy of our proxy materials, please follow the instructions included in the Notice of Internet Availability of Proxy Materials. We encourage you to register to receive all future stockholder communications electronically, instead of in print. This means that access to the proxy statement, Annual Report on Form 10-K, and other correspondence will be delivered to you via email.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to be held on Wednesday, May 3, 2023:

______________

The proxy statement, proxy card and Annual Report on Form 10-K are available at https://materials.proxyvote.com/42805E.

QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS

AND THE 2023 ANNUAL MEETING

Q: What is the purpose of these materials?

A: The Board is providing these proxy materials for you in connection with Heska’s upcoming 2023 Annual Meeting. Eligible stockholders of record as of the close of business on March 6, 2023 (the “Record Date”), are invited to attend the Annual Meeting and are entitled and requested to vote on the items of business to be conducted at the Annual

Meeting.

Q: Why did I receive a Notice of Internet Availability of Proxy Materials regarding the Internet availability of proxy materials instead of a full set of printed proxy materials?

A: In accordance with the rules of the Securities and Exchange Commission, instead of mailing

a printed copy of our proxy materials to all of our stockholders, we have elected to furnish such materials to selected stockholders by providing access to these documents over the Internet through the notice and access process. Accordingly, commencing on or about March 21, 2023, we sent a Notice of Internet Availability of Proxy Materials (the “Notice”) to most of our stockholders. These stockholders have the ability to access the proxy materials on a website referred to in the Notice and to download printable versions of the proxy materials or to request to receive a printed set of the proxy materials. Instructions on how to access the proxy materials over the Internet or to request a printed copy of the materials from us may be found in the Notice.

Q: When and where is the Annual Meeting?

A: The Annual Meeting will be held virtually, at http://meetnow.global/M2CPXHH, on Wednesday, May 3, 2023, at 9:00 a.m., MDT. To virtually gain entry to the Annual Meeting, you will need the 15-digit control number included in the Notice or on the proxy card that you request and receive by mail or email.

Q: What information is contained in our proxy materials?

A: The information included in this proxy statement relates to the proposals to be voted on at the 2023 Annual Meeting, the voting process, the compensation of our Directors and most highly paid Executive Officers, and certain other required information. Our Annual Report on Form 10-K for the year ended December 31, 2022 (our "2022 Form 10-K"), as filed with the Securities and Exchange Commission (the "SEC"), is also included on the website referred to in the Notice.

Q: What items of business will be voted on at the Annual Meeting?

A: The items of business scheduled to be voted on at the Annual Meeting are:

(1)The election of the eight nominees named in this proxy statement to serve on our Board of Directors, each for a one-year term;

(2)The ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023;

(3)The approval of the Stock Plan Amendment; and

(4)The approval of our executive compensation in a non-binding advisory vote.

We will also transact such other business as may properly come before the 2023 Annual Meeting or any adjournment or postponement thereof.

Q: How does the Board recommend I vote on the proposals?

A: The Board recommends that you vote FOR the election of the eight Director nominees named in this proxy statement, FOR the ratification of Grant Thornton LLP as the Company's independent registered public accounting firm, FOR the approval of the Stock Plan Amendment, and FOR the approval of the Company's executive compensation.

Q: What classes of stock does Heska's Charter authorize?

A: Our Charter authorizes three classes of stock. First, our Charter authorizes a class of Traditional Common Stock and defines it as the "Original Common Stock". We will refer to this class of stock in these proxy materials as the "Original Common Stock". Second, our Charter authorizes a class of Public Common Stock and defines it as the "Common Stock" or the "NOL Restricted Common Stock". We will refer to this class of stock in these proxy materials as the "Public Common Stock" or the "NOL Restricted Common Stock". Third, our Charter authorizes a class of Preferred Stock. We refer to this class of stock in these proxy materials as the "Preferred Stock". For the purpose of these proxy materials, references to "Common Stock" mean collectively Original Common Stock and Public Common Stock.

Q: Who is an eligible stockholder entitled to vote at the Annual Meeting?

A: Stockholders of record of our Common Stock as of the close of business on March 6, 2023, the record date, will be entitled to notice of, and to vote at, the Annual Meeting. If your shares of Common Stock are registered directly in your name with Computershare Trust Company, N.A. ("Computershare"), our registrar and transfer agent, you are considered a stockholder of record with respect to those shares. Some stockholders hold shares through a bank, broker, or other nominee, and are often said to hold these shares in “street name.” These stockholders are considered “beneficial owners” of those shares of Common Stock. If you held shares of Common Stock as a beneficial owner in street name as of the close of business on March 6, 2023, you must obtain a legal proxy, executed in your favor, from the holder of record of those shares at that time to be entitled to vote those shares of Common Stock at the Annual Meeting. Each stockholder is entitled to one vote for each share of Common Stock held on the Record Date. As of the Record Date, 10,871,518 shares of our Common Stock were issued and outstanding; and no shares of Preferred Stock were issued and outstanding. A list of stockholders entitled to vote at the Annual Meeting will be available at the Annual Meeting and for ten days prior to the meeting during normal business hours at our offices at 3760 Rocky Mountain Avenue, Loveland, Colorado 80538, and during the Annual Meeting accessible at http://meetnow.global/M2CPXHH. Though our offices may generally remain closed to public visitors through the date of the Annual Meeting, if you wish to examine the list in person, you may contact our Corporate Secretary, and arrangements will be made for you to review the list.

If you own Common Stock of record, you will be able to virtually gain entry to the Annual Meeting by entering the 15-digit control number found on the Notice. If you own Common Stock in street name, in order to gain entry you must present proof of beneficial stock ownership as of the record date to Computershare prior to the Annual Meeting.

Q: Can eligible stockholders who are unable or unwilling to attend the Annual Meeting vote?

A: Yes, such stockholders may vote by proxy.

Q: How can I direct a vote by proxy?

A: If you are a record holder you may: (a) indicate your voting preferences, sign and date each proxy card by following the corresponding instructions on each proxy card you receive by request and return each such proxy card in the postage prepaid envelope or by other means acceptable to Computershare; (b) indicate your voting preferences via the telephone by following the corresponding instructions; (c) indicate your voting preferences via the Internet prior to the Annual Meeting by following the corresponding instructions on the Notice; or (d) vote during the Annual Meeting by clicking the "Cast Your Vote" link.

If you have shares held in street name, you should indicate your vote for the shares via any procedure(s) adopted by your broker, bank or other nominee. These may include directing proxy votes by mail, telephone or the internet.

Q: How can I change my proxy vote or revoke my proxy?

A: If you are a record holder, you have the right to revoke your proxy and change your voting instructions at any time before the meeting by notifying our Corporate Secretary, returning a later-dated proxy card, updating your vote via the telephone by following the corresponding instructions or updating your vote via the Internet by following the corresponding instructions on the Notice. You may also revoke your proxy and change your vote by voting at the Annual Meeting.

For shares held in street name, you should follow any corresponding procedure(s) adopted by your broker, bank or other nominee.

Q: Who can help answer my questions?

A: If you have any questions about the Annual Meeting or how to vote or revoke your proxy, you should contact:

Heska Corporation

Attn: Corporate Secretary

3760 Rocky Mountain Avenue

Loveland, Colorado 80538

(970) 493-7272

InvestorRelations@Heska.com

If you need printed copies of this proxy statement or voting materials, please contact our Corporate Secretary as described above.

Q: What does it mean if I get more than one proxy card?

A: It probably means that you hold shares of Common Stock in more than one account. Direct your votes on all proxies to ensure that all of your shares are voted if you do not plan to attend the Annual Meeting.

Q: Who will serve as inspector of elections?

A: The inspector of elections will be a representative of Computershare, our registrar and transfer agent.

Q: How do you expect votes will be counted for quorum and other purposes?

A: Shares underlying proxies containing directions indicating a “for”, “withhold” (in the case of Proposal No. 1), “against”, or “abstain” vote, as well as any legitimate proxies without any voting instructions, will be counted as “present” for purposes of determining a quorum.

If you hold shares in street name through a broker, bank or other nominee, your broker, bank or nominee may not be permitted by law, rule or policy to exercise voting discretion with respect to certain matters to be acted upon at the Annual Meeting that are not considered to be “routine” matters. If you do not give your broker, bank or nominee specific instructions, your underlying shares may not be voted on those matters, potentially resulting in so-called "broker non-votes."

Pursuant to our bylaws, abstentions or broker non-votes on a given matter will be treated as not present or entitled to vote on such matter, but shall be treated as present and entitled to vote for all other purposes. Therefore,

withheld votes, abstentions or broker non-votes will not affect the outcome of the vote on such matters.

We suggest you clearly indicate your voting preferences on all matters to help ensure your voting preferences are accurately recorded.

Q: What are the quorum and voting requirements for the Annual Meeting?

A: The holders of a majority of the issued and outstanding shares of our Common Stock, present virtually or represented by proxy at the Annual Meeting, will constitute a quorum for the transaction of business at the Annual Meeting.

The election of Directors presented in Proposal No. 1 is to be determined by a plurality of the votes of the shares of Common Stock having voting power present virtually or represented by proxy at the Annual Meeting and entitled to vote on the subject matter (a "Plurality Vote"). This means that the eight nominees with the most votes will be elected. Votes may be cast for or withheld from each nominee, but a withheld vote or a broker non-vote will not affect the outcome of the election of Directors at the Annual Meeting. See “Board Structure and Committees—Director Resignation Policy” for a description of our policy that applies in the event a Director is not elected by a majority vote.

The ratification of the selection of our independent registered public accounting firm for fiscal 2023 in Proposal No. 2 is to be approved by the vote of a majority of the shares of our Common Stock present virtually or by proxy, and entitled to vote on the subject matter (a "Voting Majority"). Abstentions and broker non-votes, if any, will have no effect on the outcome of the vote for this proposal.

Nasdaq rules require stockholder approval by a majority of votes cast to approve the Stock Plan Amendment in Proposal No. 3. Our bylaws require approval by a Voting Majority. Abstentions and broker non-votes will not affect the outcome of the vote for this proposal.

Approval of our executive compensation in a non-binding advisory vote in Proposal No. 4 is

to be obtained by the vote of a Voting Majority. Abstentions and broker non-votes will have no effect on the vote for this proposal.

Q: How do I ask a question in connection with the 2023 Annual Meeting?

A: Stockholders will have the opportunity to submit questions in advance of and during the Annual Meeting.

In advance of the Annual Meeting, stockholders may submit questions by emailing the question and proof of ownership to InvestorRelations@Heska.com. The deadline to submit question in advance is 5:00 p.m. Mountain Daylight Time on May 2, 2023. Proof of ownership includes a copy of one of the following: (i) your proxy card or voting instruction form, (ii) your Computershare account statement indicating your ownership of our common stock as of the record date, or (iii) the Notice of Internet Availability of Proxy Materials.

During the Annual Meeting, stockholders may submit questions in writing by accessing the virtual meeting website at http://meetnow.global/M2CPXHH and entering the 15-digit control number included in the Notice of Internet Availability of Proxy Materials or on the proxy card that you request and receive by mail or email. Questions may be submitted using the “Q&A” tab.

Questions submitted that are pertinent to the Company and the items being voted on by stockholders during the Annual Meeting will be read aloud and answered, as time permits and in accordance with Annual Meeting procedures. Questions regarding personal matters, including those related to employment, product or service issues, or related to strategic transactions are not pertinent to Annual Meeting matters and therefore will not be answered. Substantially similar questions will be grouped, summarized and answered together due to time constraints. Our Investor Relations or General Counsel’s office will respond to other questions not answered during the Annual Meeting, as appropriate.

Q: What happens if additional matters are presented at the 2023 Annual Meeting?

A: Other than the four specific items of business described in this proxy statement, we are not aware of any other business to be acted upon at the 2023 Annual Meeting. If other business properly comes before the Annual Meeting, the persons named in the form of proxy will vote in accordance with their best judgment.

Q: What happens if a nominee for Director is unable to stand for election?

A: If for any unforeseen reason any nominee is unwilling or unable to serve as a Director, the persons named as proxyholders may vote your proxy for such other candidate or candidates who may be nominated by the Board, although the proxyholders retain full discretion to vote as they may determine. Alternatively, the Board may reduce the size of the Board, or the proxies may vote just for the remaining nominees, leaving a vacancy that the Board may fill at a later date. However, we have no reason to believe that any of the nominees will be unwilling or unable to serve if elected as a Director.

Q: Where can I find the voting results of the meeting?

A: We intend to announce preliminary voting results at the Annual Meeting, and publish final voting results in a Current Report on Form 8-K (a "Form 8-K") to be filed with the SEC within four business days after the Annual Meeting. If final voting results are not available within four business days after the Annual Meeting, we intend to publish preliminary voting results in a Form 8-K to be filed with the SEC by the fourth business day following the Annual Meeting and then publish final voting results in a Form 8-K to be filed with the SEC within four business days following the final voting results becoming known.

Q: Who bears the costs of soliciting votes for the Annual Meeting?

A: Heska is making this solicitation and will pay

the entire cost of the solicitation. If requested, certain of our Directors and employees may solicit proxies on our behalf in person, by mail, telephone, email, facsimile or other means. No additional compensation will be paid to these people for such solicitation. We have engaged Morrow Sodali LLC, 333 Ludlow St, Stamford, CT 06902 ("Morrow Sodali") to solicit proxies on our behalf for a fee of $12,500, plus variable amounts for additional proxy solicitation services. Upon request, we will also reimburse brokerage houses and other custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses for forwarding proxy and solicitation materials to stockholders.

Q: May I propose actions for consideration at next year's Annual Meeting or nominate individuals to serve as Directors?

A: Yes. You may submit proposals, including Director nominations, for consideration at future stockholder meetings. All proposals or nominations should be addressed to: Corporate Secretary, Heska Corporation, 3760 Rocky Mountain Avenue, Loveland, Colorado 80538.

Stockholder Proposals: For a stockholder proposal to be considered for inclusion in our proxy statement for the annual meeting next year, the written proposal must be received by our Corporate Secretary at our principal executive offices under either (1) Rule 14a-8 (a "Rule 14 Proposal") under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or (2) the Bylaws of Heska (a "Bylaws Proposal"). A Rule 14 Proposal must be received by our Corporate Secretary at our principal executive offices no later than November 22, 2023. If the date of next year's annual meeting is moved more than 30 days before or after the anniversary date of this year's annual meeting, the deadline for inclusion of proposals in our proxy statement is instead a reasonable period of time before we begin to print and mail our proxy materials. Such proposals will also need to comply with Rule 14a-8 under the Exchange Act regarding the inclusion of stockholder proposals in company-sponsored proxy materials. For a Bylaws Proposal, the stockholder must deliver a written notice of

intent to propose such action in accordance with our Bylaws, which in general require that the notice be received by us not less than 60 days nor more than 90 days prior to the first anniversary of the date on which notice of the prior year's annual meeting was mailed to stockholders. These proxy materials for the Annual Meeting are to be mailed on or about March 21, 2023. This means that for the 2024 Annual Meeting of Stockholders, any such proposal must be received no earlier than December 22, 2023 and no later than January 21, 2024.

Director Nominees: You may propose Director candidates for consideration by the Board's Corporate Governance Committee. Any such recommendations should be directed to our Corporate Secretary at our principal executive offices. In addition, you may nominate a Director for consideration by Heska's stockholders if you give timely and adequate notice to our Corporate Secretary of your intention to make such nomination in accordance with our Bylaws, which require that the notice be received by the Corporate Secretary within the time periods for a Bylaws Proposal described above under "Stockholder Proposals" and with the detail regarding your nomination as is required by our Bylaws. In addition to satisfying the deadlines in the advance notice provisions of our Bylaws, a stockholder who intends to solicit proxies in support of nominees submitted under these advance notice provisions must provide the notice required under Rule 14a-19 to our Corporate Secretary no later than March 4, 2024.

Copy of Bylaw Provisions: You may contact our Corporate Secretary at our principal executive offices for a copy of the relevant Bylaw provisions regarding the requirements for making stockholder proposals and nominating Director candidates. A copy of our current Bylaws has also been filed with the SEC and is included as an exhibit with our 2022 Form 10-K. This document is accessible at the website of the SEC at www.sec.gov.

BOARD STRUCTURE AND COMMITTEES

Our Board has three standing Committees, each of which is chaired by an independent Director: (1) Audit (the "Audit Committee"), (2) Compensation (the "Compensation Committee") and (3) Corporate Governance (the "Corporate Governance Committee"). The membership during 2022 and the function of each Committee are described below. Our Board held seven meetings during 2022. Our Board currently has eight Directors, with terms set to expire in 2023: Scott W. Humphrey, Chair, Robert L. Antin, Stephen L. Davis, Dr. Joachim A. Hasenmaier, Mark F. Furlong, Sharon J. Maples, David E. Sveen, Ph.D., and Kevin S. Wilson. We encourage our Directors to attend each Annual Meeting, and all of our Directors attended our last Annual Meeting of Stockholders on May 4, 2022 via webcast or telephone. All Board members (during the periods that he or she served) attended at least 75% of all Board and applicable Committee meetings during 2022.

Board Leadership Structure

We separate the role of Chair of the Board and Chief Executive Officer. Scott W. Humphrey serves as the Chair of our Board, while Kevin S. Wilson serves as our Chief Executive Officer. In considering the separation of the Chair of the Board and Chief Executive Officer roles, the Board considered corporate governance, potential conflicts of interest and time management questions.

Board Risk Oversight

Our business, including risk oversight, is conducted with the advice, counsel and direction of our Board. The formal channel for risk-related information to be communicated to our Board is through our Chief Executive Officer. Our Chief Executive Officer periodically conveys the Company's risks, including credit, cybersecurity, liquidity, regulatory, legal, environmental, social and governance ("ESG") and operational risks to the Board at Board meetings and through other forms of communication, as appropriate. Our Board may also discuss the Company's risks with other members of management as directed by our Chief Executive Officer or as part of another Board function. For example, our Chief Financial Officer has discussed credit and regulatory risks and our Chief Administrative Officer has discussed cybersecurity and ESG risks with Directors during Audit Committee meetings.

Board Independence

Our Board has determined that the following Directors standing for election have no material relationship with the Company (either directly or as a partner, stockholder or officer of an organization that has a relationship with the Company) and meet the requirements of "independence" as set forth in the rules and regulations promulgated by the SEC and the Nasdaq Stock Market listing standards (the "Nasdaq Listing Standards"): Mr. Humphrey, Mr. Antin, Mr. Davis, Dr. Hasenmaier, Mr. Furlong, and Ms. Maples. Dr. Sveen, whose son, Christopher Sveen, is an Executive Officer of the Company, and Mr. Wilson, Heska's Chief Executive Officer and President, are not considered independent.

Audit Committee

Our Audit Committee has the following primary responsibilities and powers:

•appoint and replace our independent auditor;

•compensate and oversee the work of our independent auditor;

•select, retain, compensate, oversee and terminate any other registered public accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit, review or attestation services for the Company;

•pre-approve all audit and audit-related services, tax services and permitted non-audit services to be performed by our independent auditor;

•form and delegate authority to subcommittees when appropriate;

•retain special legal, accounting or other advisors;

•make regular reports to the Board, at least annually;

•review and discuss with management and the independent auditor the Company's annual audited financial statements, including disclosures made in management’s discussion and analysis and ESG related disclosures, and recommend to the Board whether the audited financial statements should be included in the Company’s Form 10-K;

•review and discuss with management and the independent auditor the Company's quarterly financial statements;

•review and discuss with management the Company's quarterly earnings press releases prior to their release;

•discuss with management and the independent auditor significant financial reporting issues and judgements made in connection with the preparation of the Company's financial statements;

•receive reports from management regarding, and review and discuss the adequacy and effectiveness of, the Company's disclosure controls and procedures;

•review and discuss quarterly reports from the independent auditors;

•discuss with management and the independent auditor the effect of regulatory and accounting initiatives;

•discuss with management the Company's major financial risk exposures and the steps management has taken to monitor and control such exposures, including, without limitation the incorporation of cybersecurity, data privacy and ESG related risks into the Company's risk assessment and risk management policies;

•discuss with the independent auditor the matters required to be discussed by PCAOB Auditing Standard No. 1301, Communications with Audit Committees;

•review disclosures made to the Audit Committee by the Company's CEO and CFO during their certification process for the Form 10-K and Form-Q;

•ensure that the independent auditor is informed of the Audit Committee's understanding of the Company's relationships and transactions with related parties;

•oversee relevant related party transactions governed by applicable accounting standards;

•review and evaluate the senior members of the independent auditor team;

•obtain and review a report from the independent auditor at least annually;

•ensure the rotation of the lead (or coordinating) audit partner;

•recommend to the Board policies for the Company's hiring of current or former employees of the independent auditor;

•meet with the independent auditor regarding the planning and staffing of the audit;

•obtain from the independent auditor assurance that Section 10A(b) of the Exchange Act has not been implicated;

•oversee the Company's compliance program with respect to legal and regulatory requirements;

•oversee and review the adequacy and effectiveness of the Company’s cybersecurity, information and technology security, and data privacy programs, procedures and policies;

•establish procedures for the receipt, retention and treatment of reports of potential misconduct; and

•discuss with management and the independent auditor any correspondence with regulators or governmental agencies and any published reports that raise material issues regarding the Company's financial statements or accounting policies.

During 2022, our Audit Committee met six times. Our Audit Committee consists of Mr. Furlong, as Chair, Mr. Humphrey, Dr. Hasenmaier, and Mr. Davis.

Our Board has determined that each of the current members of our Audit Committee meets the requirements of "independence" as set forth in Section 10A(m)(3) of the Exchange Act, the rules and regulations promulgated by the SEC and the Nasdaq Listing Standards. Our Board has also determined that

each of Mr. Furlong, Mr. Humphrey, and Dr. Hasenmaier are qualified as an audit committee financial expert within the meaning of the rules and regulations promulgated by the SEC and each has accounting and related financial management expertise within the meaning of the Nasdaq Listing Standards.

Our Audit Committee has a written charter, which is available on our website at www.heska.com (under the tabs — Investors — Company Information — Corporate Governance). The Company's website address provided above is not intended to function as a hyperlink, and the information on the Company's website is not and should not be considered part of this proxy statement and is not incorporated by reference herein.

Compensation Committee

Our Compensation Committee has the following primary responsibilities and powers:

•review and approve the annual base salaries and annual incentive compensation opportunities of the Executive Officers;

•review and approve the following as they affect the Executive Officers: (a) any incentive awards and opportunities, (b) any employment agreements and severance agreements, (c) any change-in-control agreements and change-in-control provisions affecting any elements of compensation and benefits, and (d) any special or supplemental compensation or benefits for Executive Officers and persons who formerly served as Executive Officers;

•review and approve corporate goals and objectives relevant to CEO compensation, evaluate the CEO's performance in light of those goals and objectives, and recommend to the Board the CEO's compensation levels based on this evaluation;

•review and discuss any Compensation Discussion and Analysis to be included in the Company's proxy statement and Annual Report on Form 10-K;

•produce any annual Compensation Report for including in the Company's proxy statement;

•oversee the Company's compliance with SEC rules and regulations regarding stockholder approval of certain executive compensation matters;

•receive periodic reports on the Company's compensation program as they affect all employees;

•approve and oversee compensation programs involving use of the Company's stock;

•retain, terminate and approve the retention terms and fees of any compensation consultant;

•appoint, compensate and oversee the work of any such compensation consultant, legal counsel or other advisor;

•form and delegate authority to subcommittees when appropriate; and

•make regular reports to the Board.

During 2022, our Compensation Committee met five times. From May 5, 2021 to February 22, 2022 our Compensation Committee consisted of Ms. Maples, as Chair, Mr. Antin, Mr. Humphrey and Mr. Furlong. From February 22, 2022 to present, our Compensation Committee consists of Ms. Maples, as Chair, Mr. Humphrey, and Mr. Furlong.

Our Board has determined that each of the current members of our Compensation Committee meets the requirements of "independence" as set forth in the rules and regulations promulgated by the SEC and the Nasdaq Listing Standards.

Our Compensation Committee has a written charter, which is available on our website at www.heska.com (under the tabs — Investors — Company Information — Corporate Governance). The Company's website address provided above is not intended to function as a hyperlink, and the information on the Company's website is not and should not be considered part of this proxy statement and is not incorporated by reference herein.

Corporate Governance Committee

Our Corporate Governance Committee has the following primary responsibilities and powers:

•evaluate the current composition, organization and governance of the Board and its committees, determine future requirements and make recommendations to the Board for approval;

•determine desired Board member skills and attributes and evaluate and propose nominees for election to the Board;

•review Director candidates recommended by stockholders that are submitted in compliance with the Company’s bylaws and stockholder nominations and recommendations policy;

•oversee and administer a biennial Board performance evaluation process;

•consider matters of corporate governance and review periodically the Company’s corporate governance guidelines and codes of conduct and ethics and recommend proposed changes to the Board for approval;

•consider questions of possible conflicts of interest of Board members and the Company’s senior executives and review and approve in advance any proposed related party transactions;

•conduct reviews periodically on succession planning and make recommendations to the Board;

•monitor stock ownership guidelines related to Directors that may be adopted by the Board;

•review and advise the Board on Director compensation matters;

•recommend matters for consideration by the Board and regarding the structure of Board meetings;

•form and delegate to subcommittees when appropriate;

•make regular reports to the Board; and

•retain and terminate any search firm used to identify Director candidates.

During 2022, our Corporate Governance Committee met four times. From February 4, 2021 to February 22, 2022, our Corporate Governance Committee consisted of Mr. Davis, as Chair, Mr. Antin, Ms. Maples, and Dr. Hasenmaier. From February 22, 2022 to present, our Corporate Governance Committee consists of Mr. Davis, as Chair, Ms. Maples, and Dr. Hasenmaier.

Our Board has determined that each of the current members of our Corporate Governance Committee meets the requirements of "independence" as set forth in the rules and regulations promulgated by the SEC and the Nasdaq Listing Standards.

Our Corporate Governance Committee has a written charter, which is available on our website at www.heska.com. In addition, our Corporate Governance Committee prepared, and our full Board has approved, Corporate Governance Guidelines outlining the qualifications, responsibilities and other issues related to our Board's governance role and functions. The document is also available on our website at www.heska.com (under the tabs — Investors — Company Information — Corporate Governance). The references to the Company's website address provided above is not intended to function as a hyperlink, and the information on the Company's website is not and should not be considered part of this proxy statement and is not incorporated by reference herein.

Director Qualification and Nomination

The tenure of the Directors serving on our Board varies from two years to twelve years. All of our Directors have gained Company and industry specific knowledge as a result. The experience, qualifications, attributes or skills that qualify our Directors to serve on our Board are discussed on a Director-by-Director basis in the "Election of Directors" section of this document as well as in this "Board Structure and Committees" section. None of our Directors are serving as a result of one specific qualification. It is the

breadth of their individual experiences and the manner in which they complement each other as a group that make them individually and collectively attractive Directors.

Our Corporate Governance Committee does not have an established policy for minimum qualifications of Director nominees or appointees. However, pursuant to our Corporate Governance Committee Charter, we believe that it is in the best interests of the Corporation and its stockholders to obtain highly qualified candidates for the Board. Our Corporate Governance Committee seeks candidates with excellent decision-making ability, business experience, relevant experience, personal integrity and reputation as candidates for nomination and appointment.

Our Corporate Governance Committee does not have an established policy for diversity of Director nominees or appointees. However, we believe diversity is inherent in our approach of seeking high quality individuals with complementary skills to create a group dynamic and decision-making process that is even stronger than would be obtained by the mere summation of its individual contributors in isolation. While not an established policy, in 2021, our Corporate Governance Committee adopted an overriding principle named the “Wilson Rule” to seek qualified and diverse candidates as new Director openings become available.

In 2020, our Corporate Governance Committee formalized its process for identifying and evaluating nominees or appointees for Director. Our Corporate Governance Committee determines desired Board member skills and attributes and conducts searches for prospective Director candidates whose skills and attributes reflect those desired. This analysis may start with a Board evaluation, including determination of areas of strength and areas for improvement. Particular skills and experience may be desired in areas of improvement. Our Corporate Governance Committee may determine guidelines and parameters for a search for an individual with the desired skills and experience. Our Corporate Governance Committee will evaluate candidates identified by its own initiative as well as candidates referred to it by other members of the Board, by the Company's management, or by external sources, such as a third-party executive search firm. Our Corporate Governance Committee has adopted a policy stating it will not consider unsolicited applications for Board membership.

Our Corporate Governance Committee will also consider nominees recommended by stockholders provided such recommendations are made in accordance with our Bylaws and the procedures described in this proxy statement under "Questions and Answers About the Proxy Materials and the 2023 Annual Meeting". Although to date no stockholder has presented any candidate for Board membership to us, it is expected that recommendations from stockholders would generally be considered in the same manner as recommendations by a Director or an Officer of the Company.

Director Resignation Policy

Pursuant to our bylaws, Directors are elected by a plurality vote. The Board has adopted a Director Resignation Policy pursuant to which, in uncontested elections of Directors in which the number of nominees does not exceed the number of Directors to be elected, the Board will nominate for election or re-election only candidates who agree that if, in an uncontested election of Directors, the nominee receives a greater number of votes “withheld” from his or her election than votes “for” his or her election (a “Majority Withhold Vote”), the nominee will tender, within five days following the certification of the stockholder vote, an irrevocable offer of resignation to the Chair of the Board. The offer of resignation shall be conditional upon acceptance by the Board, following consideration of the offer by the Board and the Corporate Governance Committee. When a nominee fails to receive the required number of votes for reelection and the resignation offer takes effect, the Corporate Governance Committee will promptly consider the offer and recommend to the Board whether to accept or reject it. The Board then will, within 90 days following certification of the stockholder vote, act on the Corporate Governance Committee’s recommendation. The Company will disclose in a filing with the SEC or a widely-disseminated press release the Board’s decision to accept or reject the resignation offer, including its rationale.

The Corporate Governance Committee, in making its recommendation, and the Board, in making its decision, will consider the best interests of the Company and its stockholders and may consider any factors or information it deems relevant, including but not limited to: (i) the stated reasons, if any, why stockholders withheld their votes; (ii) possible alternatives for curing the underlying cause of the withheld votes; (iii) the Director’s tenure; (iv) the Director’s qualifications; (v) the Director’s past and expected future contributions to the Company; and (vi) the overall composition of the Board and its committees.

In addition, the Corporate Governance Committee and the Board may consider a range of alternatives in determining what action to take, including but not limited to: (i) accepting the resignation; (ii) rejecting the resignation, including with conditions for the Director’s continued service; (iii) rejecting the resignation to allow the Director to remain on the Board but agreeing that the Director will not be nominated for re-election upon expiration of the Director’s term; or (iv) deferring acceptance of the Director’s resignation until the Board can find a replacement Director with the necessary qualifications to fill the vacancy that accepting the resignation would create.

Any Director who fails to receive the required number of votes will not participate in the deliberations or voting by the Corporate Governance Committee or the Board with respect to the Director’s resignation offer.

If a Director’s resignation offer is not accepted by the Board, that Director will continue to serve for the term for which he or she was elected and until his or her successor is duly elected, or his or her earlier resignation or removal. If a Director’s resignation offer is accepted by the Board, then the Board, in its sole discretion in accordance with the our bylaws, may fill any resulting vacancy or may decrease the size of the Board.

Stockholder Communication with our Board

Stockholders can contact our Board, any Committee thereof, or any Director in particular, by writing to them, c/o Heska Corporation, 3760 Rocky Mountain Avenue, Loveland, Colorado 80538, Attn: Corporate Secretary. We will forward any correspondence sent in the foregoing manner to the appropriate addressee without review by management.

Commitment to Corporate Responsibility and Stewardship

The Company is committed to corporate responsibility and stewardship. Driven by oversight from the Board and executive leadership, we are promoting and engaging environmental, social and governance ("ESG") priorities throughout the organization to align activities and resources with sound practices and accountability. The Board’s Governance Committee, in collaboration with key management, is responsible for advancing the Company’s ESG strategy with input and execution from a cross-functional team consisting of Legal, Human Resources, Finance, Operations, Supply Chain and Procurement, Research and Development, Product Quality and Safety, Data Privacy and Security, and business leaders. Members of the cross-functional team periodically engage with external stakeholders such as shareholders and industry experts regarding best practices and initiatives. In addition, ESG-related risks and opportunities are identified and assessed as part of the Board’s regular discussions and meetings, at least annually, including matters related to human capital management; diversity, equity and inclusion; sustainability within supply chain; and environmental management practices.

Hedging Company Securities

Our Directors and Executive Officers may not engage in pledging or hedging transactions, or other transactions designed to hedge or offset any decrease in the market value of our securities. These restrictions do not apply to other employees of the Company.

Board Diversity Matrix

The following table presents certain information with respect to the composition of the Company's Board as of March 6, 2023.


Board Diversity Matrix (as of March 6, 2023)
Total Number of Directors	8
	Female	Male
Part I: Gender Identity
Directors	1	7
Part II: Demographic Background
African American or Black	0	1
White	1	6

DIRECTOR COMPENSATION

The form and amount of compensation paid to the non-employee Directors is periodically reviewed by our Corporate Governance Committee. Any revisions to our Director compensation program are recommended by our Corporate Governance Committee and approved by our Board.

Our employee Directors do not receive any separate compensation for Board activities.

Non-Employee Director Compensation

Under our current Director compensation program, on the date of each Annual Meeting of Stockholders each non-employee Director receives restricted stock awards valued at $125,000 (the "Annual Director Grant"). These grants vest in full on the later of (i) the one year anniversary of the date of grant and (ii) the Company’s next Annual Meeting of Stockholders. Such vesting is generally subject to the non-employee Director's continued service with the Company through the vesting period. Any non-employee Director appointed or elected between Annual Meetings is granted a pro-rata restricted stock award which vests on the same schedule outlined above.

Each non-employee Director also receives an annual cash retainer in the amount of $55,000, with the Chair of the Board receiving an additional amount of $50,000 per year ($105,000 total). The Company pays the annual retainers in quarterly installments on the first business day of each calendar quarter, subject to the non-employee Director's continued service to the Company as a non-employee Director on such date.

Non–employee Directors are additionally provided a quarterly $1,000 stipend for customary and usual travel and other expenses incurred in connection with their services on the Board. These stipends are only paid when travel is required for in-person attendance. Travel and other expenses that exceed the fixed sum are eligible for reimbursement.

Director Compensation Table

The following table presents the compensation earned by or paid by the Company to the non-employee Directors for the year ended December 31, 2022.

Director Compensation


Name	Fees Earned Or Paid in Cash ($)	Stock Awards ($) (1) (2)	All Other Compensation ($) (3)	Total ($)
Robert L. Antin	55,000	124,936	4,000	183,936
Stephen L. Davis	55,000	124,936	4,000	183,936
Mark F. Furlong	55,000	124,936	4,000	183,936
Dr. Joachim A. Hasenmaier	55,000	124,936	4,000	183,936
Scott W. Humphrey (4)	105,000	124,936	4,000	233,936
Sharon J. Maples	55,000	124,936	4,000	183,936
David E. Sveen, Ph.D.	55,000	124,936	4,000	183,936

(1)These amounts represent the aggregate grant date fair value of stock awards granted in 2022 as calculated pursuant to Financial Accounting Standards Board Accounting Standards Codification Topic 718. The methodology and assumptions used in the valuation of stock awards can be found in our 2022 Form 10-K in Note 12 "Capital Stock" of the Notes to Consolidated Financial Statements.

(2)As of December 31, 2022, each of our non-employee Directors held the following unvested restricted stock awards and outstanding options:

2022 Outstanding Awards to Directors


Name	Unvested Shares	Outstanding Options
Robert L. Antin	1,107	—
Stephen L. Davis	1,107	—
Mark F. Furlong	1,107	—
Dr. Joachim A. Hasenmaier	1,107	—
Scott W. Humphrey	1,107	—
Sharon J. Maples	1,107	3,571
David E. Sveen, Ph.D.	1,107	—
All Directors (7 persons)	7,749	3,571

(3)These amounts represent the quarterly travel stipends.

(4)Mr. Humphrey was paid all cash retainers and his annual travel stipend through Chumley Enterprises, LLC.

2022 Equity Grants to Directors


Name	Grant Date	Number of Shares	Grant Date Closing Share Price ($)	Stock Value of Stock Award ($)
Robert L. Antin	5/4/2022	1,107	112.86	124,936
Stephen L. Davis	5/4/2022	1,107	112.86	124,936
Mark F. Furlong	5/4/2022	1,107	112.86	124,936
Dr. Joachim A. Hasenmaier	5/4/2022	1,107	112.86	124,936
Scott W. Humphrey	5/4/2022	1,107	112.86	124,936
Sharon J. Maples	5/4/2022	1,107	112.86	124,936
David E. Sveen, Ph.D.	5/4/2022	1,107	112.86	124,936

Non-Employee Director Stock Ownership Guidelines

Each of our non-employee Directors is required to hold shares of Common Stock at least equal in value to three times (3x) the annual cash retainer for Board service (the "Director Ownership Guideline"). Non-employee Directors are required to achieve this level of ownership on or before the fifth anniversary of the date such Director became a member of the Company’s Board.

For purposes of Heska’s stock ownership guidelines, a non-employee Director’s stock ownership includes all shares of Common Stock owned outright by the Director and by his or her immediate family members (spouse and dependent children), and any shares held in trust for the benefit of the Director and/or his or her immediate family members. Unvested restricted stock and unexercised stock options are excluded from the calculation of stock ownership under the Director Ownership Guideline.

As the Company’s current cash retainer for non-employee Directors is $55,000, the Director Ownership Guideline currently requires Directors to hold at least $165,000 in shares of Common Stock. As of December 31, 2022, each of our non-employee Directors held shares in excess of this value or was within the time frame available for meeting the ownership requirement.

PROPOSALS TO BE VOTED ON

PROPOSAL NO. 1

ELECTION OF DIRECTORS

We are to elect eight Directors at our 2023 Annual Meeting: Robert L. Antin, Stephen L. Davis, Mark F. Furlong, Dr. Joachim A. Hasenmaier, Scott W. Humphrey, Sharon J. Maples, David E. Sveen, Ph.D., and Kevin S. Wilson. Directors elected at our 2023 Annual Meeting are to hold office for a one-year term expiring at our 2024 Annual Meeting (or until their respective successors are elected and qualified, or until their earlier death, resignation or removal).

Nominees for Election

Robert L. Antin, age 73, has served us as a Director since November of 2020. Mr. Antin was a founder of VCA Antech, Inc. (“VCA”), a publicly traded national animal healthcare company (NASDAQ: WOOF) that provides veterinary services, diagnostic testing and various medical technology products and related services to the veterinary market. Mr. Antin has served as a Director, Chief Executive Officer and President at VCA since its inception in 1986. From September 1983 to 1985, Mr. Antin was President, Chief Executive Officer, a Director and co-founder of AlternaCare Corp., a publicly held company that owned, operated and developed freestanding out-patient surgical centers. From July 1978 until September 1983, Mr. Antin was an officer of American Medical International, Inc., an owner and operator of health care facilities. Mr. Antin received his Bachelor’s degree from the State University of New York at Cortland and his MBA with a certification in hospital and health administration from Cornell University. Mr. Antin’s executive experience in the veterinary industry provides an excellent background for service on the Board.

Stephen L. Davis, age 65, has served us as a Director since August of 2020. Mr. Davis is the Chairman and Founder of the Will Group. He created Electrical Resource Management, the first Will Group company, in 1986 to honor the legacy of his father William E. Davis, who was known for his integrity and hard work. Since then, the Will Group has established several more companies to provide diverse lighting products, data and communications technologies, manufacturing, and services to metropolitan areas around the world. The Will Group has generated hundreds of local jobs, highlighted by its offender reentry program, and won many large-scale projects over the years, regularly contracting with utility, industrial, and commercial organizations across the United States. Embodying its mantra, “Where there’s a Will, there’s a Way,” the Will Group has consistently been recognized as one of the country’s Top 100 Black Businesses by Black Enterprise Magazine. Mr. Davis currently serves on the Board of the Trust Company of Illinois, PMI Energy Solutions, and Inland Real Estate Trust, specifically on Inland’s Audit and Compensation committees. Mr. Davis previously served on the Board of Wheaton Bank and Trust, specifically on the Loan committee, and he is currently a member of the Economic Club of Chicago and the University Club of Chicago. With a strong commitment to philanthropy, Mr. Davis created the William and Mary Davis foundation which funds programs to help underprivileged individuals find purpose and empowerment. His philanthropic work includes founding the Tuskegee NEXT Foundation, which is focused on training the next generation of African-American pilots, Purpose by Design, a mentoring program for teens in under-resourced and at-risk communities, and Haymarket Center of Chicago, which provides support services to people and families with chemical dependencies. Mr. Davis's financial and corporate governance experience provides valuable insight to the Board.

Mark F. Furlong, age 65, has served us as a Director since March 2019. Mr. Furlong retired as President and Chief Executive Officer of BMO Harris Bank, N.A. in June 2015, a role he held from 2011. He joined Marshall & Ilsley in 2001 as Chief Financial Officer, was elected President in 2004, Chief Executive Officer in 2007, and Chairman in 2010. Prior to joining Marshall & Ilsley, he was Chief Financial Officer of Old Kent Financial Corp.; First Vice President, Corporate Development, for H. F. Ahmanson & Company; and an audit partner for Deloitte & Touche LLP. Mr. Furlong also is a member of the boards of Directors of Kforce Inc. and Antares Capital. Mr. Furlong is also active in numerous civic and charitable activities. He is a former Chair of Chicago United and Leap Innovations, is a former board member of the Chicago Board of

Education and the Chicago Teachers Pension Fund. He is currently a member of the board of Directors for Common Ground Foundation and HomeRising. Mr. Furlong’s experience includes his role as an audit partner, serving as Chief Financial Officer and Chief Executive Officer, and his background in finance and his experience serving on boards contribute valuable insight and experience to the Board.

Dr. Joachim A. Hasenmaier, age 62, has served us as a Director since January of 2021. Dr. Hasenmaier served as a Member of the Board of Managing Directors of C.H. Boehringer Sohn AG & Co. KG ("BI") from October 1, 2012 until his retirement in 2019, responsible for the Corporate Board Division Consumer Health Care and Animal Health. He received a veterinary medical degree (DVM) in 1986 from Ludwig-Maximilians-University, Munich, where he entered into a microbiological research program until 1989 receiving his Doktor med. vet. (PhD) degree. He completed his education with a Master in Management from Kellogg Business School, Chicago, USA in 1991. Prior to joining BI he worked in various positions for various international companies in Germany, Japan, Mexico and Brazil. In 2002 he joined Boehringer Ingeheim as Corporate Senior Vice President for Boehringer Ingelheim Animal Health. In 2011 he took over the regional responsibility for Prescription Medicine in NECAR (UK/Ireland, Nordics, Benelux, Canada, Australia/New Zealand). He held this position until he became Member of the Board of Managing Directors at C.H. Boehringer Sohn AG & Co. KG in October 2012. Dr. Hasenmaier’s executive experience in the animal health and consumer healthcare industry provides an excellent background for service on the Board. Dr. Hasenmaier is an active member of the Rotary Club Ingelheim for more than 20 years. Through Rotary and private projects Dr. Hasenmaier tries to fight poverty and to give young, less favored people a fair chance to succeed in life.

Scott W. Humphrey, age 52, has served us as a Director since June 2017 and as our Board Chair from October 2018 to the present. Mr. Humphrey is a semi-retired executive, having spent the first chapter of his professional life as an investment banker and the second chapter in the non-profit arena. Most recently, he served as the President & CEO of One Hope United (OHU), a diversified, multi-state social services provider, a position he held from August 2015 to February 2018. Mr. Humphrey also does private investing and periodically serves in advisory board roles for several for-profit organizations. At the time of his retirement from investment banking in 2015, Mr. Humphrey was a Senior Advisor/Vice Chair for BMO Capital Markets (BMO), the US investment banking business of the Bank of Montreal, where he was responsible for corporate board relationship development and financial advisory assignments. He joined BMO in 2007 as the Head of U.S. Mergers & Acquisitions and, in early 2012, expanded his responsibility to include the Industrial Investment Banking business. Prior to joining BMO Capital Markets, Mr. Humphrey spent almost ten years with Deutsche Bank as a Managing Director focusing on global mergers and acquisitions. Given his global business and financial market background, he is a financial expert and provides expertise with respect to the Company’s strategic planning as well as advising on various capital market and stockholder matters. In the non-profit arena, Mr. Humphrey serves on the Board of Nexus Family Healing, a multi-state social services provider, and the Lake County Community Foundation, a regional foundation serving the needs of the residents of Lake County (IL). He also serves on the President’s Council of Kids Above All, an Illinois-based social services provider. Mr. Humphrey holds a BS in Finance and Economics from the University of Arizona and a Master's in Public Policy and Administration from Northwestern University.

Sharon J. Maples, age 62, has served as a Director since July 2011. She served as Board Chair from October 2015 to October 2018 and was Lead Director for a year prior to her time as Board Chair. Ms. Maples currently serves as Principal and CEO of SLR Associates, LLC. a healthcare strategy consulting firm. Ms. Maples served as Chief Executive Officer for University of Texas Southwestern ("UTSW") Hospitals, Dallas, Texas from 2004 to 2011. Prior to joining UTSW, Ms. Maples was Chief Operating Officer of Anne Arundel Health System in Annapolis, Maryland. She has held additional executive roles leading top healthcare organizations including serving as the Chief Operating Officer of the University of Nebraska Medical Center, Omaha Nebraska, and as a Vice President responsible for service line growth and development as well as operational accountability at Inova Fairfax and Inova Mt. Vernon Hospitals, Inova Health System, Fairfax Virginia. Ms. Maples is a board member with a track record of strategic success, mentoring and financial turnaround. She is a health care executive with hospital and health system experience at the CEO and COO

level, leading academic medical centers, community based health systems and specialty hospitals. Currently, Ms. Maples serves as an Advisory Board member for the University of Texas at Dallas (UTD) Center for Healthcare Leadership and Management, Jindal School of Management and to the Dallas County Initiative to end the HIV Epidemic. She is a member of the Executive Leadership team for Texas Scottish Rite Hospital for Children and member of the International Women’s Foundation (IWF). She currently serves Texas Women’s Ventures, LLC. as a member and has also served as a portfolio advisor. Ms. Maples is former Chair of American Heart Association’s “Go Red for Women” annual initiative and former Board member of the American Hospital Association Regional Planning Board. She has served on the Dallas-Fort Worth Hospital Council Board of Directors and The University of Iowa Health Management Alumni Board, where she served as Chair. She has held Board positions at Digi Works Corporation, a privately held data mining services and analytics company and Anthelio, a privately held information technology and software company. Ms. Maples holds a BBA (Business Administration) and MA (Hospital and Health Administration) from the University of Iowa, Iowa City, Iowa. Ms. Maples’s executive experience in the healthcare industry leading major healthcare companies and advising companies at both the executive and board level regarding strategic growth and operational integration provide an excellent background for service on the Board.

David E. Sveen, Ph.D., age 66, has served us as a Director since November 2013. He is the Executive Chair and Managing Director of Cedarstone, an operations, analytics and strategy consulting practice for nonprofit organizations, which he founded in 1993. He is also currently the President of the Domanada Foundation. His professional background includes 13 years in senior management with investment banking firm Griffin, Kubik, Stephens and Thompson, an adjunct assistant professorship of Christian Formation and Ministry at Wheaton College since 1995 and service on several profit and nonprofit boards. Dr. Sveen holds a Ph.D. degree from Trinity Evangelical Divinity School, an MBA from DePaul University, an MA from Wheaton Graduate School, and a B.S. degree from Northern Illinois University. Dr. Sveen brings to the board extensive leadership experience, financial and accounting knowledge and executive level management capability.

Kevin S. Wilson, age 51, has been our Chief Executive Officer and President since March 31, 2014. He previously served as our President and Chief Operating Officer from February 2013 to March 2014. Mr. Wilson is a founder, member and officer of Cuattro, LLC, Cuattro Software, LLC, and Cuattro Medical, LLC, which, since 2008, have been involved in developing technologies for digital imaging. Mr. Wilson served on the board of various private, non-profit, and educational organizations from 2005 to the present. He was a founder of Sound Technologies, Inc., a diagnostic imaging company, in 1996, which was sold to VCA Antech, Inc. in 2004, after which Mr. Wilson served as Chief Strategy Officer for VCA Antech, Inc. until 2006. Mr. Wilson attended Saddleback College. Mr. Wilson brings to the Board extensive executive leadership and relationships experience in the animal health industry, including the management of operations, sales, service, product development, business development, and support.

If a Director or any alternative nominee is unable or declines to serve as Director at the time of the 2023 Annual Meeting, the proxyholders intend to vote for such other candidate or candidates who may be nominated by the Board.

Recommendation of our Board of Directors

Our Board recommends a vote FOR the election of all eight nominees.

PROPOSAL NO. 2

RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Our Board is submitting the appointment of Grant Thornton LLP ("Grant Thornton") as the Company's independent registered public accounting firm for stockholder ratification at the 2023 Annual Meeting. A representative of Grant Thornton is expected to be present at the Annual Meeting and will have an opportunity to make a statement if the representative desires to do so. Such representative also is expected to be available to answer questions at the meeting.

Stockholder ratification of the appointment of Grant Thornton as our independent registered public accounting firm is not required by our Bylaws or otherwise. Our Board, however, is submitting the appointment of Grant Thornton to the stockholders for ratification as a matter of good corporate governance practice. If stockholders fail to ratify the appointment, our Audit Committee will reconsider whether or not to retain Grant Thornton as our independent registered public accounting firm, although our Audit Committee maintains the full discretion to continue to retain Grant Thornton in such a circumstance. Even if the appointment is ratified, our Audit Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interest of the Company and its stockholders.

Recommendation of our Board of Directors

Our Board recommends a vote FOR the ratification of Grant Thornton as our independent registered public accounting firm for the fiscal year ending December 31, 2023.

PROPOSAL NO. 3

APPROVAL OF AN AMENDMENT TO THE HESKA CORPORATION EQUITY INCENTIVE PLAN TO INCREASE THE NUMBER OF SHARES AUTHORIZED FOR ISSUANCE THEREUNDER BY 100,000 SHARES

We currently maintain the Heska Corporation Equity Incentive Plan (the “Stock Plan”) for the purpose of promoting the long-term success of the Company and the creation of stockholder value by (a) encouraging employees, outside Directors and consultants to focus on critical long-range objectives, (b) encouraging the attraction and retention of employees, outside Directors and consultants with exceptional qualifications and (c) linking employees, outside Directors and consultants directly to stockholder interests through increased stock ownership. The Stock Plan serves as an important part of our overall compensation program. The number of shares available for issuance under the Stock Plan, however, is believed to be insufficient for future needs. The Board adopted, subject to the approval of our stockholders, a proposed amendment to increase the number of shares of Common Stock authorized for issuance under the Stock Plan.

Summary of Proposed Amendment to the Stock Plan

As of March 6, 2023, we had an aggregate of 1,150,318 shares authorized for issuance under the Company’s Equity Incentive Plan or prior equity incentive plans (the “Prior Plans”) of which approximately 1,059,741 shares had previously been issued under the Equity Incentive Plan or the Prior Plans or were reserved for issuance pursuant to outstanding awards under the Equity Incentive Plan or the Prior Plans, leaving approximately 90,577 shares of Common Stock available for future issuance under the Equity Incentive Plan.

If the Stock Plan amendment is approved, the aggregate number of shares of Common Stock available for awards under the plan will be increased by 100,000 (representing approximately 0.92% of our shares outstanding as of March 6, 2023), so that the new total of shares authorized for issuance as under the Stock Plan will be 1,250,318. Assuming none of the unexercised options as of March 6, 2023 are exercised and none of the unvested restricted shares or restricted stock units as of March 6, 2023 vest, the total number of shares available for new awards under the Stock Plan, as amended would be 804,999. Conversely, assuming all such unexercised options are exercised and unvested restricted shares and restricted share units vest, the total number of shares available for new awards under the Stock Plan, as amended, would be 190,577.

After consultation with management and Willis Towers Watson, the Compensation Committee's independent compensation consultant, the Board has determined the need to increase the shares authorized under the Stock Plan in order to give the Company flexibility recruiting new members of its management team and retaining and rewarding its existing management team. Willis Towers Watson has advised the board on median equity requirements for management positions and, based on current grant practices and the Company’s current stock price, the Board currently believes that 100,000 shares will be sufficient to meet these needs in the next year. The Company expects to continue with a yearly share authorization request of between 75,000 and 125,000 shares a year (representing approximately 0.7%-1.2% of our shares outstanding as of March 6, 2023).

As of March 6, 2023, there were 10,871,518 common shares outstanding. In addition, as of March 6, 2023, approximately 90,577 shares of Common Stock were available for future issuance under the Stock Plan and the following equity awards were outstanding as of the same date (assuming full achievement of any applicable performance-conditions for performance-based awards):

•Outstanding options: 339,272 (weighted average remaining life of 5.3 years and weighted average exercise price of $62.95)

•Outstanding performance stock options: 244,800 (weighted average remaining life of 6.6 years and weighted average exercise price of $80.48)

•Non-vested restricted stock units: 30,350

•Non-vested restricted stock awards: 475,879

Summary of Stock Plan

Below is a summary of the material terms of the Stock Plan. This summary is qualified by reference to the full text of the Stock Plan, as proposed to be amended, which is included as Appendix A hereto.

General. The purpose of the Stock Plan is to promote the long-term success of the Company and the creation of stockholder value by (a) encouraging employees, outside Directors and consultants to focus on critical long-range objectives, (b) encouraging the attraction and retention of employees, outside Directors and consultants with exceptional qualifications and (c) linking employees, outside Directors and consultants directly to stockholder interests through increased stock ownership. The Stock Plan seeks to achieve this purpose by providing for restricted stock awards, restricted stock units, options (which may constitute incentive stock options or non-qualified stock options), stock appreciation rights, other cash-based awards, or other stock-based awards.

Effective Date and Expiration. The Stock Plan became effective on May 5, 2021. The Stock Plan has no predetermined expiration date, although incentive stock options may not be granted under the Stock Plan after February 18, 2031. Awards made prior to any termination or suspension of the Stock Plan may extend beyond that date.

Administration. The Stock Plan must be administered by a committee of two or more independent Directors appointed by the Board, which is currently the Compensation Committee (the "Committee"). The Committee has full authority to interpret the Stock Plan and to establish rules for its administration. To the fullest extent permitted by law, the Committee may delegate to one or more officers of the Company the authority to designate the individuals, other than Section 16 officers or Directors of the Company, who are eligible to receive awards pursuant to the terms of the Plan, who will receive awards under the Plan and the size of each such grant.

Eligibility for Awards. Awards can be made to any employee, outside Director or consultant selected to receive an award under the Stock Plan. Only employees, however, are eligible to receive incentive stock options. As of March 6, 2023, approximately 879 employees and our seven non-employee Directors were eligible to receive awards under the Stock Plan.

Determination of Amount and Form of Award. The amount and form of individual awards is determined by the Committee or its delegate, subject to the limitations of the Stock Plan.

Shares Subject to the Plan; Other Limitations on Awards. Subject to certain adjustments, the maximum number of shares of our Common Stock that may be issued pursuant to new awards under the Stock Plan, as proposed to be amended, is 450,000 plus the 800,318 shares of our Common Stock that remained available for grant under the Prior Plans as of May 5, 2021. The closing price of a share of our Common Stock as reported on the Nasdaq stock market on March 6, 2023 was $86.06.

Shares subject to an award under the Stock Plan or under one of the Prior Plans that is canceled, forfeited, settled in cash or expired without having been exercised or paid will again be available (or will be made available) for future awards under the Stock Plan. On the other hand, shares of our Common Stock that are (i) tendered in payment of options, (ii) withheld from any award to satisfy a participant's tax withholding obligations, or (iii) subject to a stock appreciation right that are not issued in connection with its stock settlement on exercise, in each case, will not be available for future awards under the Stock Plan. In addition, Common Shares repurchased by the Company using the proceeds from an option exercise will not be made available for issuance or delivery under the Stock Plan. Shares of Common Stock issued pursuant to the Stock Plan may be authorized but unissued shares or treasury shares, or shares reacquired by the Company in any manner.

In addition, the Stock Plan limits compensation paid to each outside Director in respect of his or her service as an outside Director, including cash fees and incentive equity awards (based on their grant date fair value for financial reporting purposes), to a maximum of $300,000 per fiscal year. Compensation will be counted

toward this limit in the year in which it is earned and not when paid or settled in the event that payment is deferred.

Minimum Vesting Provision. Awards are subject to a minimum vesting period of one year or, for awards made to outside Directors, on the earlier of one year or the date of the next regular annual meeting of the Company’s stockholders that is at least 50 weeks after the immediately preceding year’s annual meeting. However, awards for which vesting is accelerated in the event of a participant’s death or disability or upon the occurrence of a change in control will not be subject to this one-year minimum vesting requirement. Additionally, the Committee may grant awards covering 5% or less of the total number of shares authorized for issuance under the Stock Plan without regard to the minimum vesting requirement.

Stock Options. The Committee may grant non-qualified options and options intended to qualify as "incentive stock options" under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"). The Committee generally determines the terms and conditions of all options granted, subject to the terms of the Stock Plan. Options vest in accordance with a vesting schedule determined by the Committee, and the Committee may impose additional conditions, restrictions or terms on the vesting of any option, including the full or partial attainment of performance goals. The term of an incentive stock option cannot exceed ten years from the date of grant. The option price of an incentive stock option must be not less than 100% of the fair market value of a share of our Common Stock on the date of grant.

The option price may be paid in cash, with shares of our Common Stock, through a broker-assisted "cashless" exercise procedure or with such other acceptable form of valid consideration and method of payment as may be determined by the Committee.

Restricted Stock Awards. The Committee may also issue or transfer shares of our Common Stock to a participant as a restricted stock award under the Stock Plan. Restricted stock awards are subject to certain conditions and restrictions during a specific period of time, such as the participant remaining in the employment of the Company or a subsidiary and/or the attainment of certain pre-established performance goals. The shares cannot be transferred by the participant prior to the lapse of the restriction period and/or the attainment of the performance goals. The participant is entitled to vote restricted stock awards during the restriction period. Unless otherwise provided in the award agreement, restricted stock awards will receive also dividends; provided, that any such dividends will be accumulated and paid at the time (and only to the extent) that the underlying restricted stock awards vest.

Restricted Stock Units. A restricted stock unit is a right to receive shares of Common Stock (or their cash equivalent) at a specified date in the future, subject to forfeiture of such right. If the restricted stock unit has not been forfeited, then on the date specified in the restricted stock unit grant, the Company must deliver to the holder of the restricted stock unit shares of Common Stock (or their cash equivalent). In the Committee’s discretion, holders of restricted stock units may be entitled to receive dividend equivalents; provided, that any such dividend equivalents will be accumulated and paid at the time (and only to the extent) that the underlying restricted stock units vest. A participant holding restricted stock units will have no rights as a stockholder with respect to the shares subject to the restricted stock units until all restrictions have been lifted and the shares have been issued to the participant.

Stock Appreciation Rights. A stock appreciation right entitles the holder to receive an amount equal to the difference between the fair market value of a share of Common Stock on the exercise date and the exercise price of the stock appreciation right (which may not be less than 100% of the fair market value of a share of our Common Stock on the grant date), multiplied by the number of shares of Common Stock subject to the stock appreciation right (as determined by the Committee). Like other awards under the Stock Plan, stock appreciation rights will be subject to vesting and forfeiture provisions as determined by the Committee.

Other Stock-Based Awards. Under the Stock Plan, we may grant or sell to any participant unrestricted Common Stock, dividend equivalent rights and/or other awards denominated in or valued by reference to our

Common Stock. A dividend equivalent is a right to receive payments, based on dividends declared or paid with respect to shares of our Common Stock.

Other Cash-Based Awards. We may grant cash awards under the Stock Plan, including cash awards as a bonus or based upon the attainment of certain performance goals.

Performance Based Awards. Under the Stock Plan, the Committee may grant any award type subject to vesting based on the achievement of performance goals or the vesting of which is accelerated based on the achievement of performance goals. Such performance-goals will be established in the Committee’s sole discretion.

No Repricing of Options or Stock Appreciation Rights. The exercise price of stock options or stock appreciation rights may not be reduced without stockholder approval. This means that the Committee may not take any of the following actions without stockholder approval:

•Amend a stock option or stock appreciation right to reduce its option price;

•Cancel a stock option or stock appreciation right in exchange for a new option with a lower exercise price;

•Cancel a stock option or stock appreciation right in exchange for a different type of award that has a value that is greater than the excess of the fair market value of the applicable shares on the date of such payment over the exercise price;

•Authorize, in lieu of the exercise or in exchange for the cancellation of a stock option or stock appreciation right, the payment of cash in an amount that is greater than the excess of the fair market value of the shares of Common Stock on the date of such payment over the exercise price; or

•Take any other action (whether in the form of an amendment, cancellation or replacement grant) that has the effect of repricing a stock option or stock appreciation right without stockholder approval.

Changes in Capitalization. In the event of a subdivision of our outstanding shares of Common Stock, a declaration of a dividend payable in shares, a declaration of a dividend payable in a form other than shares in an amount that has a material effect on the price of shares, a combination or consolidation of the outstanding shares (by reclassification or otherwise) into a lesser number of shares, a recapitalization, a spin-off or a similar occurrence, such that an adjustment is appropriate to prevent dilution or enlargement of the benefits intended to be made available under the Stock Plan, then the Committee may make appropriate adjustments in the maximum aggregate number and kind of shares issuable under the Stock Plan and the number and kind of shares and the exercise price per share subject to outstanding awards.

Change in Control. An award agreement may provide that an award will become fully vested and exercisable in the event of a change in control.

Amendment. The Board can amend, suspend or terminate the Stock Plan. An amendment of the Stock Plan will be subject to our stockholders' approval only to the extent required by law or the requirements of the Nasdaq stock market.

Incorporation by Reference. The foregoing is only a summary of our Stock Plan, as proposed to be amended, and is qualified in its entirety by reference to its full text, a copy of which is attached hereto as Appendix A.

Certain U.S. Federal Income Tax Aspects

The following paragraphs are a summary of the Company's understanding of the general federal income tax consequences to U.S. taxpayers and the Company of awards granted under the Stock Plan. Tax consequences for any particular individual may be different. This summary describes the U.S. federal income tax rules in effect on the date hereof and does not purport to be complete. It does not discuss the tax consequences of a participant's death or the income tax laws of any state or foreign country in which the

participant may reside. Participants are encouraged to consult their own tax advisors regarding participation in the Stock Plan.

Incentive Stock Options. No taxable income is reportable when an incentive stock option is granted or exercised (except for purposes of the alternative minimum tax, in which case taxable income is the same as for nonstatutory stock options). If the participant exercises the option and then later sells or otherwise disposes of the shares more than two years after the grant date and more than one year after the exercise date, the difference between the sale price and the exercise price will be taxed as capital gain or loss. If the participant exercises the option and then later sells or otherwise disposes of the shares before the end of the two- or one-year holding periods described above, he or she generally will have ordinary income at the time of the sale equal to the fair market value of the shares on the exercise date (or the sale price, if less) minus the exercise price of the option if the sale price exceeds the exercise price.

Nonstatutory Stock Options. No taxable income is reportable when a nonstatutory stock option, which also may be referred to as a nonqualified stock option, is granted to a participant. Upon exercise, the participant will recognize ordinary income in an amount equal to the excess of the fair market value (on the exercise date) of the shares purchased over the exercise price of the option. Any additional gain or loss recognized upon any later disposition of the shares would be capital gain or loss.

Restricted Stock Awards. A participant will not have taxable income upon grant unless he or she elects to be taxed at that time by filing an 83(b) election pursuant to Section 83(b) of the Code. Instead, he or she will recognize ordinary income at the time of vesting equal to the fair market value (on the vesting date) of the vested shares.

Stock Appreciation Rights. A participant who is granted a stock appreciation right will not recognize ordinary income upon receipt or vesting of the stock appreciation right. At the time of exercise, however, the participant will recognize ordinary income equal to the value of any cash received and the fair market value of any shares received. The participant's tax basis in any shares received will be the fair market value on the date of exercise and, if the shares are later sold or exchanged, then the difference between the amount received upon such sale or exchange and the fair market value of the shares on the date of exercise will generally be taxable as long-term or short-term capital gain or loss (if the stock is a capital asset of the participant) depending upon the length of time such shares were held by the participant.

Restricted Stock Units. A participant who is granted a restricted stock unit will not recognize ordinary income upon the receipt of the restricted stock unit, but rather will recognize ordinary income in an amount equal to the fair market value of the shares (or value of the cash paid) at the time of settlement.

Other Stock-Based and Other Cash-Based Awards. In the case of other stock-based and other cash-based awards, depending on the form of the award, a participant generally will not be taxed upon the grant of such an award, but, rather, will generally recognize ordinary income when such an award vests or otherwise is free of restrictions.

Tax Effect for the Company. The Company generally will be entitled to a tax deduction in connection with an award under the Stock Plan in an amount equal to the ordinary income realized by a participant and at the time the participant recognizes such income (for example, the exercise of a nonstatutory stock option or a stock appreciation right or the settlement of a restricted stock unit). Section 162(m) of the Code may limit the deductibility of compensation paid to certain of our Executive Officers.

Existing Plan Benefits

No awards made under the Stock Plan prior to the date of the Annual Meeting were granted subject to stockholder approval of this Proposal 3. The following table sets forth information with respect to stock options and stock awards that have been granted to our Named Executive Officers and the specified groups set forth below under the Stock Plan from the effective date of the plan through March 6, 2023. The amounts

reflected below assume the achievement of the maximum level of performance under all performance-based stock options and stock awards.


Name and Principal Position	Stock Options	Stock Awards (Restricted Stock Awards and Restricted Stock Units)
Kevin S. Wilson Chief Executive Officer and President	34,800	180,000
Catherine I. Grassman Executive Vice President, Chief Financial Officer	—	27,994
Steven M. Eyl Executive Vice President, Chief Commercial Officer and President, Scil Animal Care Company	—	5,507
Eleanor Baker Executive Vice President, Managing Director of scil animal care company	—	11,907
Christopher Sveen Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary, President, Diamond Animal Health	—	10,307
All Executive Officers as a group (7 persons)	34,800	302,178
All non-Executive Directors as a group (7 persons)	—	12,383
All employees (other than Executive Officers and non-Executive Directors as a group)	19,500	86,382

Future awards to our officers and other employees under the Stock Plan, as amended, will be made in accordance with future decisions of the Committee. As a result, it is not possible to determine the benefits and amounts that will be received by any individual participant or group of participants in the future. Although not necessarily indicative of future grants that may be made under the Stock Plan, please see the "Long-Term Equity Compensation" section below with respect to awards under the Stock Plan to our Named Executive Officers in 2022.

Equity Compensation Plan Information

The following table sets forth information about our common stock that may be issued upon exercise of options and settlement of rights under all of our equity compensation plans as of December 31, 2022, including the Stock Plan and the 2020 Employee Stock Purchase Plan, as amended and restated (the "ESPP").


Plan Category	(a) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights	(b) Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights	(c) Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities reflected in column (a))
Equity Compensation Plans Approved by Stockholders	584,838	$74.88	310,540 (1)
Equity Compensation Plans Not Approved by Stockholders	None	None	None
Total	584,838	$74.88	310,540 (1)

(1)Includes 178,516 shares available for issuance under the ESPP and 132,024 shares available for issuance under the Stock Plan.

Vote Required; Recommendation of our Board of Directors

Nasdaq rules require stockholder approval by a majority of votes cast to approve the proposed amendment to the Stock Plan. Our bylaws require approval by a Voting Majority. Abstentions and broker non-votes will not affect the outcome of the vote for this proposal.

Our Board recommends a vote FOR the approval of the proposed amendment to the Stock Plan.

PROPOSAL NO. 4

APPROVAL OF EXECUTIVE COMPENSATION IN A

NON-BINDING ADVISORY VOTE

Section 14A of the Exchange Act requires that we provide you with the opportunity to vote to approve, on a non-binding advisory basis, the compensation of our Named Executive Officers as reported in this proxy statement. We are asking for your advisory vote on the following non-binding resolution (the "say-on-pay" resolution):

RESOLVED, that the compensation paid to the Company's Named Executive Officers, as disclosed in the subsection of this proxy statement titled "Executive Compensation", including the Compensation Discussion and Analysis, compensation tables and related narrative discussion, is hereby APPROVED.

The Company conducts annual “say-on-pay” resolutions until the next advisory stockholder vote on this matter is required under Section 14A of the Exchange Act, or until the Board of Directors otherwise determines that a different frequency for such votes is in the best interest of the Company’s stockholders. It is anticipated that the next advisory vote to approve Named Executive Officer compensation will be conducted at our 2024 Annual Meeting of Stockholders.

Compensation Philosophy

As described in greater detail under the heading "Executive Compensation", we seek to closely align the interests of our Named Executive Officers with the interests of our stockholders. The ultimate objective of our executive compensation program is to recruit, retain and reward executives who will enhance the value and profitability of the Company and increase stockholder value. The Compensation Committee strives to provide competitive compensation opportunities with the ultimate amount of compensation received tied significantly to short-term and long-term Company performance. Inherent in our approach is the philosophy that compensation can align behavior and actions with stockholder interests, attract and retain stronger executives and thus create value for stockholders over time.

The vote on this resolution is not intended to address any specific element of compensation, but rather relates to the overall compensation of our Named Executive Officers, as described in this proxy statement in accordance with the compensation disclosure rules of the SEC.

Shareholder Engagement

In response to the low level of support expressed by shareholders on last year’s say-on-pay vote, we undertook extensive shareholder outreach efforts to gain a better understanding of our shareholders' concerns regarding our executive compensation program. For additional information about the concerns expressed and the actions we have taken in response, please refer to “Compensation Discussion & Analysis—2022 Pay Decisions in Response to Shareholder Say-on-Pay Vote” below.

Vote Required; Recommendation of our Board of Directors

If a Voting Majority is FOR this proposal, we will consider the non-binding, advisory approval of the compensation paid to our Named Executive Officers to have passed. If such a Voting Majority is not obtained, our Compensation Committee may consider changes to some of our executive compensation policies, although our Compensation Committee maintains its full discretion in this area as this is an advisory vote only.

Our Board recommends a vote FOR the approval, on a non-binding, advisory basis, of the compensation paid to our Named Executive Officers in fiscal year 2022 as reported in this proxy statement.

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

This Compensation Discussion and Analysis describes the compensation awarded to, earned by, or paid to our 2022 Named Executive Officers:

•Kevin S. Wilson, Chief Executive Officer and President;

•Catherine I. Grassman, Executive Vice President, Chief Financial Officer;

•Steven M. Eyl, Executive Vice President, Chief Commercial Officer and President, Scil Animal Care Company;

•Eleanor F. Baker, Executive Vice President, Managing Director of Scil Animal Care Company; and

•Christopher D. Sveen, Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary of Heska Corporation and President, Diamond Animal Health.

Executive Summary

2022 Business and Financial Highlights

In evaluating our overall executive compensation program and decisions, including payouts under the 2022 programs and plan designs for our 2023 programs, the Compensation Committee considered a number of factors, including the strategic and financial performance and position of our company in 2022. In 2022, we achieved record consolidated revenue, increasing margin expansion and solid North America Point-on-Care (“POC”) Lab Consumable growth, despite certain economic and industry uncertainties.

Some specific highlights and key accomplishments considered by the Committee in its decision-making process during 2022 included the following:

•Full year consolidated revenue increased 1.4% on a reported basis and 5.4% on a constant currency basis (see “Use of Non-GAAP Financial Measures” in the 2022 Form 10-K) to $257.3 million;

•Consolidated gross margin increased 150 bps year over year to 43.2%;

•Total Active Subscriptions increased 18%, Months Under Subscription increased 15%, and Minimum Contract Subscription Value (“CSV”) increased 17%, in each case over prior year levels; and

•Over 270 Element AIM® analyzers were installed in 2022, with over 370 total units now operating since their general commercial launch in the fourth quarter of 2021.

2022 Pay Decisions in Response to Shareholder Say-on-Pay Vote

The Compensation Committee considers the outcome of our historical Say-on-Pay votes when reviewing the objectives of our program and making future compensation decisions for the Executive Officers. The 2022 Say-on-Pay vote result was significantly lower than expected, and in response to the vote, members of management and the Chairman of the Board, with the support of the Compensation Committee, reached out to stockholders owning nearly 80% of the common stock represented at the 2022 meeting to ask for their opinions about our executive compensation program. In response to our outreach, we held calls with stockholders owning approximately 60% of our common stock represented at the 2022 meeting. Many of these discussions were with our largest stockholders, some of whom voted in favor of our 2022 Say-on-Pay proposal and some voted against. This outreach began before the 2022 Annual Meeting of Stockholders and continued throughout the remainder of 2022. We engaged with stockholders on conference and video calls

that allowed stockholders to share their opinions of our executive compensation program as well as to ask questions of the members of management and the Board on the calls. Stockholders were offered access to key members of management and the Chairman of the Board.

On these calls, stockholders engaged in constructive and thought-provoking conversation. The results of these calls were reported to the Compensation Committee and the other members of the Board for consideration. During the outreach process, most stockholders were generally in favor of our executive compensation program and supported the core philosophies of the program. A summary of the feedback we received, and the actions we have taken in response, are summarized below:


What we heard:			Actions taken and adjustments made:
•Size of multi-year equity award for CEO in 2021			•The Company will grant equity awards to Executive Officers on an annual basis in lieu of larger awards every few years. •The CEO will not be eligible to receive additional equity awards until 2025.
•Equity Compensation complexity that creates confusion around whether metrics are repeatable and easily achieved			•The CEO’s 2021 equity award is designed to pay out upon achievement of extremely aggressive one-year goals, as evidenced by the revenue threshold which requires achievement of a 34% increase over 2020 revenue and the revenue maximum which requires achievement of a 153% increase over 2020 revenue. •Once a metric is achieved, that metric cannot be achieved again in subsequent years. •The Company intends to grant future performance-based restricted shares that are tied to three-year performance goals.
•Shareholders would like a continued dialogue throughout the year			•The Chairman of the Board and members of management have continued to meet with shareholders on a regular basis through individual phone calls, meetings and investor conference participation. •Met with approximately 60% of shareholders representing nearly 80% of common stock since our 2022 Annual Meeting.

Executive Compensation Objectives and Philosophy

The Compensation Committee administers our executive compensation program for the Company’s Executive Officers. The ultimate objective of our executive compensation program is to attract, retain and motivate executives who will enhance the value and profitability of Heska and increase stockholder value. The Compensation Committee strives to provide competitive compensation opportunities by linking Executive Officer pay to both short-term and long-term variable compensation arrangements that align with Company financial and strategic performance objectives. Inherent in our approach is the philosophy that compensation can align behavior and actions with stockholder interests, attract and retain highly-qualified executives and create value for stockholders over time.

Components of Heska's Executive Compensation Program and How the Program is Designed to Align with Shareholders

The Compensation Committee develops our executive compensation program to align our Executive Officers’ target compensation opportunities with the business’ overall financial strength and performance while also recognizing individual contributions, leadership, and strategic achievements.

Our compensation program is designed to align executive rewards with short- and long-term financial, strategic, and individual accomplishment through both fixed and variable compensation elements as summarized below.


Component of Compensation	Description	Purpose
Base Salary	•Set on an annual basis (or in connection with new hires or promotion) •Heska has historically targeted slightly below median of its competitive market when comparing base salary competitiveness relative to market	•Serve as the only fixed pay component and typically carries the lowest weighting within the mix of executive pay •Designed to reflect competitive market values, as well as each NEO’s specific skills, responsibilities, experience, and job performance
Short-Term Performance-Based Incentive Compensation	•Heska’s Management Incentive Plan (MIP) is an annual variable pay plan that is reviewed and approved by the Compensation Committee •The MIP includes three equally weighted components—two financial measures (Revenue and Adjusted EBITDA Margin) and one strategic and individual performance measure	•Designed to motivate achievement of predetermined annual financial, strategic, research or other individual objectives •Aligns executive decision-making with annual financial and strategic goals that deliver year-over-year financial results while mitigating unnecessary risk taking when evaluating strategic decisions and initiatives


Long-Term Equity Incentive (LTI) Compensation	•Generally granted in a combination of time-based and performance-based awards, although in 2022 the Compensation Committee determined that all LTI awards would be performance-based •Generally make-up the largest weighting of an NEO’s pay mix •As previously discussed, the CEO’s 2021 LTI award was provided with the understanding that the CEO would not receive any additional equity until 2025 and, as such, he did not receive an equity award in 2022	•All LTI awards support retention efforts and align NEO interests with those of our stockholders by encouraging stock price appreciation •Performance-based LTI awards link realization or vesting to specific long-term financial, stock price or project-based goals
Other Benefits or Compensation Arrangements	•Align with the benefits provided to our broad-based employees such as participation in Heska’s 401(k) program (subject to IRS limits) and health and welfare programs •Our NEOs are also encouraged to participate in the Heska sponsored Executive Health Program that encourages an annual preventative health screening evaluation	•Providing the typical benefits to our NEOs is key to our culture and focus on employee well-being and support •Other than broad-based programs and Executive Health Program, our NEO’s do not receive any other special perquisites or benefits

Compensation Best Practices

Our executive compensation program incorporates many strong governance practices as shown below:


What we do:			We do not:
•Tie executive compensation to performance through annual incentives with pre-established goals having multiple financial measures			•Provide executives with “excise tax gross ups”
•The Compensation Committee retains an independent compensation consultant that provides no other services to the Company			•Allow repricing of stock options without shareholder approval
•Conduct risk reviews of our compensation programs and practices periodically to ensure our plans do not create risk that are likely to have a material adverse impact			•Allow Executive Officers or Directors to engage in hedging transactions, and pledging of Company stock is restricted
•Maintain a clawback policy for all incentive compensation			•Provide excessive perquisites
•Maintain rigorous stock ownership guidelines

In utilizing the elements of compensation and governance best practices described above, the Compensation Committee believes they have created an executive reward program that balances both fixed and variable sources of compensation while also linking Executive Officer rewards to both short- and long-term performance objectives that are aligned with shareholder.

Determining Executive Compensation

In establishing the compensation of our NEO’s, the Compensation Committee reviews the nature and scope of each Officer's responsibilities as well as his or her effectiveness in his or her role and in supporting the Company's long-term goals. Heska's Board of Directors (the “Board”) formally evaluates the Chief Executive Officer (the “CEO”). With regard to our other NEOs, our CEO communicates his view of their performance to the Compensation Committee and makes recommendations regarding salary, short-term incentive-based performance compensation and long-term compensation grants for the Compensation Committee's consideration.

Compensation Consultant

The Compensation Committee engaged Korn Ferry, an independent outside compensation consultant in 2022 on a limited basis regarding executive compensation matters. The Compensation Committee viewed Korn Ferry as an advisor only, and the Compensation Committee retained the discretion to implement or not implement Korn Ferry’s suggestions. Other than services related to Director compensation and executive compensation, Korn Ferry did not provide any other services to the Company.

Effective November 2022, the Compensation Committee engaged Willis Towers Watson (“WTW”) as its new independent compensation consultant. During 2022, WTW’s assistance was limited in its breadth, but WTW did review Heska’s executive compensation program, and offered recommendations and adjustments for consideration with full implementation in 2023. WTW did not provide any other services to the Company during 2023.

Compensation Peer Group Used to Inform Executive Pay Decisions

The Compensation Committee considers compensation data from companies in medical, biotechnology and general industry groups that have similar revenues, veterinary focus and/or are in a similar stage of development to Heska. The Compensation Committee reaffirmed the continued use of the existing peer group and did not make any changes to the peer group for purposes of its 2022 compensation decisions. Heska’s peer group for 2022 pay decisions included the following companies:

•Alphatec Holdings

•Axogen, Inc.

•AtriCure, Inc.

•Cardiovascular Systems

•CryoLife, Inc.

•Glaukos Corp.

•GenMark Diagnostics, Inc.

•LeMaitre Vascular

•Meridian Bioscience

•Natus Medical

•OraSure Technologies

•Orthofix Medical

•PetIQ

•Trupanion

With the assistance of WTW, the Compensation Committee undertook a review of the peer group for the compensation decisions in 2023. Two companies from the 2022 peer group have been acquired (Natus Medical and GenMark Diagnostics) and were removed from the group. To ensure a reasonable sample size, the following four companies were added to the group: Phibro Animal Health Corp, Cutera, Inc., Mesa Laboratories, Inc., and Zynex Inc. Relative to the resulting 2023 peer group of 16 companies, as of December 2022, Heska’s trailing four quarter revenue was positioned at the 35th percentile and market capitalization was positioned at the 53rd percentile.

Base Salary

The Compensation Committee reviews each NEO’s base salary at least annually and otherwise on an as-needed basis. When reviewing base salaries, the Compensation Committee considers compensation data from companies in the Peer Group. Consideration is also given to prior performance, relevant experience, level of responsibility, and skills and abilities of each NEO and internal pay equity.

As previously disclosed, on February 17, 2022, the Compensation Committee reviewed the NEO’s base salaries relative to peer group compensation data and determined to increase NEO base salaries (other than Mr. Wilson’s which was set at $1,000,000 in 2021 per his employment agreement) to better align with the Company’s perspectives on fixed compensation.


Named Executive Officer	Annual Base Salary (as of 12/31/2021)	Annual Base Salary (as of 12/31/2022)
Kevin Wilson	$1,000,000	$1,000,000
Catherine I. Grassman	$325,000	$400,000
Steven M. Eyl	$350,000	$375,000
Eleanor F. Baker	$300,000	$365,000
Christopher D. Sveen	$300,000	$365,000

Management Incentive Plan

Key Highlights

–CEO declined to receive any 2022 short term incentive bonus

–No payout earned for below threshold performance under Revenue financial metric

–Average NEO awarded 60% of Target Payout

The Management Incentive Plan (“MIP”) for 2022 is designed (i) to motivate executives to attain superior annual performance in key areas we believe create value to Heska and its stockholders and (ii) to provide incentive compensation opportunities competitive with Heska’s peers.

MIP goals are reviewed and approved each year by the Compensation Committee with input from management. A significant portion of our NEOs’ cash incentive is tied to Company performance metrics that reflect the Company’s focus on revenue, margin, profitability, and growth. In 2022, the Compensation Committee made a slight adjustment to the relative weightings of the performance metrics under the MIP such that two-thirds would be based on financial measures and one-third would be based on achievement of individual and strategic goals. Goals were selected to provide incentive to achieve objectives focused on continued profitability, key strategic initiative achievements by management and continued top line growth.

The Compensation Committee establishes a target bonus for each NEO expressed as a percentage of the executive’s base salary, with consideration to factors such as: the contribution and responsibility of the NEO, market practices, internal equity and the recommendation of the CEO (for all officers excluding himself). For 2022, the target bonuses, as a percentage of base salary, for our NEOs remained the same as in 2021, except

that the CEO's target bonus was reduced to 50% of base salary. The 2022 MIP cash incentive opportunities as a percentage of salary for each of the NEOs and 2022 results are shown below.


Named Executive Officer			2022 Target Bonus (as a % of Salary)
Kevin S. Wilson			50%
Catherine I. Grassman			50%
Steven M. Eyl			50%
Eleanor F. Baker			50%
Christopher D. Sveen			50%

The total annual MIP award actually paid to each NEO is determined based on the extent to which specified weighted objective goals are achieved with potential payouts ranging from 50% (threshold) to 200% (maximum) of the target bonus for the CEO, and 10% (threshold) to 150% (maximum) of the target bonus for the other NEOs. For purposes of the 2022 performance year, the Compensation Committee selected topline Revenue and Adjusted EBITDA Margin (weighted 50% / 50%) as the financial performance metrics under the MIP. The individual and strategic objectives were intended to reflect strategic priorities and drive certain accomplishments in 2022.

2022 Financial Measure Achievements (66.6% of the total MIP bonus opportunity)

Based on 2022 actual financial results for Revenue and Adjusted EBITDA Margin, which constitute 66.6% of the overall bonus opportunity, the financial portion of the MIP was achieved at 80% of target for the CEO and 65% of target on average for other NEOs. The table below sets forth the weighting of each of the performance metrics, the threshold, target and maximum performance level for each financial metric, Heska’s actual performance for each financial metric, and the unweighted payout percentage achieved with respect to each financial metric.

Performance Metric

Weighting

Threshold

Target

Maximum

Actual

% of Target
Achievement

Payout % of Target

Revenue (1)

33.4%

$280M

$290M

$300M

$264.56M

91.2%

Adjusted EBITDA Margin (2)

33.3%

9.0%

10.0%

11.0%

10.6%

106%

CEO: 160%
NEO: 130%

Individual Performance

33.3%

For the CEO, individual performance determined by the Compensation Committee. For other NEO’s, determined by the CEO in consultation with the Compensation Committee, regarding individual performance and contribution to company-wide operational and strategic objectives.

(1)Revenue under the MIP is our total revenue determined in accordance with GAAP.

(2)For purposes of the MIP, Adjusted EBITDA excludes interest, taxes, depreciation and amortization, stock-based compensation, acquisition and other one-time costs, such as M&A transaction expenses. Adjusted EBITDA Margin is calculated as the ratio of Adjusted EBITDA to Revenue. See “Non-GAAP Financial Measures” in the Company’s Annual Report on Form 10-K for a description of the calculation of Adjusted EBITDA Margin.

Following review of the Company’s financial and operational performance for 2022, the Compensation Committee reviewed the NEOs' individual performance, their direct contributions to revenues, better than expected Adjusted EBITDA results, and the successful acquisition and integration of strategic acquisitions (as described on our 2022 Form 10-K). In determining each NEO’s specific MIP bonus payouts, the Compensation Committee considered that the Company’s performance fell short of the threshold performance level for Revenue but exceeded target on Adjusted EBITDA Margin, as well as each individual NEO’s individual performance and contribution to company-wide objectives. Though Mr. Wilson earned an above-target bonus as a result of the Company’s performance described above and his individual contributions, he waived his right to the bonus, and the Compensation Committee, in its discretion, redistributed the amount to

reward non-executive employees within the MIP in recognition of their 2022 performance and contributions to the Company’s success.

Final MIP bonus payouts to each NEO were below target in light of our Revenue performance, but were adjusted for each NEO in recognition of their individual performance and contributions to the Company over the past year, and were approved as follows:


Named Executive Officer	2022 MIP Bonus	Percent of Target Bonus
Kevin S. Wilson	$0	0%
Catherine I. Grassman	$150,000	75%
Steven M. Eyl	$105,000	56%
Eleanor Baker	$115,000	63%
Christopher D. Sveen	$105,000	58%

Long-Term Equity Compensation

The Board and Compensation Committee are responsible for determining the size and terms of long-term equity compensation granted to Executive Officers, taking into account such factors as individual and Company performance and practices of companies in the peer group. Historically, the Board and the Compensation Committee have made less frequent, but larger grants of long-term compensation awards to the Executive Officers. Commencing in 2022, the Compensation Committee approved a shift to annual long-term equity awards. For 2022, those awards were in the form of performance-based restricted stock awards that vest based on achievement of revenue and gross margin targets.

2022 LTI Awards

In determining LTI grant values for the 2022 equity-based awards, the Compensation Committee reviewed market data based on peer group benchmarking in order to determine grant levels that would be competitive with the market. The Committee also took into consideration other factors, including each NEO’s performance, the Committee’s expectations of each NEO’s future contributions to the Company, internal equity, shares available to be granted, potential shareholder dilution and the expense associated with the awards. After considering these factors, the Committee approved the following target value of the LTI awards in February 2022 assuming 100% achievement of all performance-based vesting requirements:


Named Executive Officer			Target Value of 2022 LTI Award (assuming 100% performance)
Kevin S. Wilson			$0
Catherine I. Grassman			$800,000
Steven M. Eyl			$700,000
Eleanor Baker			$700,000
Christopher D. Sveen			$700,000

The 2022 LTI award consisted solely of performance-based restricted stock awards, which support Heska’s long-term pay-for-performance philosophy and align the interests of NEOs with those of our stockholders. The 2022 performance-based restricted stock awards are eligible to become earned based on Heska’s Revenue and Gross Margin performance, weighted equally. The Compensation Committee selected these measures because they are viewed as the primary drivers of enhanced stockholder value and are the most appropriate measures of performance given our continued growth trajectory. As described in the table

below, each performance metric has two threshold levels that may be achieved, and achievement of each threshold level will result in vesting of 25% of the award.


Performance Metrics	Thresholds	Percentage of Restricted Shares That Vest Upon Achievement
Revenue	$300,000,000 (1st Threshold)	25%
	$350,000,000 (2nd Threshold)	25%
Gross Margin	44.5% (1st Threshold)	25%
	45.5% (2nd Threshold)	25%

2023 Special Performance-Based Awards

In January 2023, after a review of NEO target compensation competitiveness and outstanding equity holdings, and in light of the dynamic and changing talent market, the Committee approved targeted performance-based equity awards to four Executive Officers (excluding the CEO) that are critical to business operations (both in the US and Internationally) and future growth initiatives. These awards generally vest if specific Committee approved Gross Margin and Adjusted EBITDA objectives, each weighted 50%, are achieved based on performance prior to December 31, 2026.

Other Benefits, Compensation or Arrangements

Our NEOs receive matching contributions under our 401(k) plan on the same basis as other employees who participate. The NEOs also participate in our group health and welfare benefits which are open to all full-time employees, including life insurance and short term disability programs for which the Company pays the premiums. In addition, the NEOs also participate in a supplemental long-term disability benefit program, which provides additional coverage to Director-level (and above) employees of the Company, including the NEOs, as well as an Executive Health Program that provides health screening and assessment focused on promoting the well-being of the Executive Team.

Clawback Policies

Heska is committed to conducting business with integrity in accordance with high ethical standards and in compliance with all applicable laws, rules and regulations. This includes the Company’s commitment to comply with all laws, rules and regulations applicable to the accuracy of the Company’s publicly reported financial information. As a result, the Board of Directors of the Company has adopted a Compensation Recoupment Policy, which provides that the Compensation Committee may, or in the case of a financial restatement that would have resulted in payment of a lesser amount will, seek the recoupment and/or forfeiture of certain incentive compensation in the event of a financial restatement, inaccurate performance calculation or egregious misconduct that has a substantial detrimental effect on the Company. The Stock Plan, equity grant agreements and certain employment agreements also include clawback provisions. Under the terms of these agreements, we will be entitled to recover any common shares acquired under vested or exercised equity awards or the economic value of previously sold common shares from such awards.

Employment Agreements

June 2021 Wilson Employment Agreement

On June 8, 2021, we entered into an amended and restated employment agreement with Mr. Wilson (the “Wilson Agreement”), which superseded and replaced Mr. Wilson’s existing employment agreement that was set to expire by its terms on December 31, 2021. The Wilson Agreement provides for an initial four-year term with automatic one-year renewals thereafter, subject to six months’ notice of non-renewal by either party. Under the Wilson Agreement, Mr. Wilson receives (i) a base salary of $1,000,000, (ii) a target bonus of at

least 50% of base salary, (iii) participation in the Company’s benefit plans, including an automobile stipend of $700 per month and home office and communications stipend of $300 per month, and (iv) the performance-based stock option and restricted share grants described in our 2021 proxy statement. The Board also agreed to nominate Mr. Wilson for election to the Board at each stockholder meeting when Mr. Wilson is up for election during the term of the agreement, including at our 2022 Annual Meeting.

Subject to execution of a release of claims, Mr. Wilson is eligible to receive certain severance payments and benefits upon a termination of his employment by the Company without cause or by Mr. Wilson for good reason. If such termination is within three months prior to or 24 months following a change in control, then Mr. Wilson will be eligible for the following severance benefits: (i) lump sum cash payment equal to 2.99x the sum of his base salary and target bonus and (ii) COBRA continuation premiums (or, if no longer eligible for COBRA, a cash payment in lieu thereof) for up to 36 months for him and his dependents. If such termination is not in connection with a change in control, then Mr. Wilson will instead be eligible to receive: (a) cash payment equal to 2.0x the sum of his base salary and target bonus and (b) COBRA continuation premiums (or, if no longer eligible for COBRA, a cash payment in lieu thereof) for up to 24 months. Additionally, if Mr. Wilson’s employment with the Company is terminated as a result of his death or disability, he or his estate will be eligible to receive a pro-rated target bonus for the year of termination and COBRA continuation premiums (or, if no longer eligible for COBRA, a cash payment in lieu thereof) for up to 24 months. The Company’s severance obligations are further subject to Mr. Wilson’s continued compliance with non-competition and non-solicitation covenants which extend for two years following the date of termination if not in connection with a change in control or three years following the date of termination if such termination is in connection with a change in control.

Upon a change in control, any unvested performance-based stock options and performance-based restricted shares will vest based on the greater of target or actual performance through the date of the change in control (based on linear interpolation for performance between target and maximum performance levels). In the event actual performance measured as of the date of such Change in Control is less than the “maximum” level with respect to a particular performance metric, the Committee may determine, in its sole discretion, to provide for further acceleration. Additionally, if Mr. Wilson’s employment with the Company is terminated as a result of Mr. Wilson’s death or disability, by the Company without cause or by Mr. Wilson for good reason, any unvested restricted shares will vest based on actual performance through the date of such termination.

Employment Agreements with other Named Executive Officers

Each of our other Named Executive Officers are also party to employment agreements. The employment agreements generally provide for the executive’s annual base salary, MIP participation, and benefits eligibility. These employment agreements also provide for severance payments and benefits under certain termination scenarios, as described in more detail below under “Potential Payments Upon Termination or Change-in-Control”. The Compensation Committee has concluded that the payments and benefits set forth in these employment agreements are standard and consistent with the payments and benefits provided to executives at companies in our Peer Group. In addition, these employment agreements also contain standard noncompetition and non-solicitation covenants. The Named Executive Officer employment agreements are intended to provide the Named Executive Officers with protections appropriate for their positions and in line with those received by comparable executives at companies similar to Heska. Periodically, we review these agreements versus market benchmarks.

Executive Officer Stock Ownership Guidelines

We maintain Stock Ownership Guidelines for all of our Executive Officers. Under the guidelines, the Chief Executive Officer is to hold a number of shares of common stock at least equal in value to 5x the Chief Executive Officer's base salary. Under the guidelines, the other Executive Officers are to hold a number of shares of common stock at least equal in value to 1.5x their respective base salaries. Newly appointed or

promoted Executive Officers have three years from their respective hire dates to achieve these ownership guidelines. Until an Executive Officer achieves the target guideline, he or she is expected to retain 50% of the net shares received upon exercise or vesting of awards under our equity incentive plans.

For purposes of Heska’s stock ownership guidelines, an Executive Officer’s stock ownership includes all shares of Heska’s common stock owned outright by the Executive Officer, shares owned jointly by Executive Officer and his or her spouse and any shares held in trust for the benefit of the Executive Officer and/or his or her family members. Shares of unvested restricted common stock count toward compliance but other unvested awards and shares underlying unexercised options do not.

Compensation and Risk

The Compensation Committee has assessed our employee compensation programs and does not believe our compensation policies for our Executive Officers, our sales force or our other employees are reasonably likely to have a material adverse effect on our Company. We generally pay our sales force commissions based on sales volume and other targets, which we believe is typical in our industry.

COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Company has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K and, based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.


			THE COMPENSATION COMMITTEE

			Sharon J. Maples, Chair
			Mark F. Furlong
			Scott W. Humphrey

March 21, 2023

Historical and Summary Compensation Tables

The following table sets forth compensation for services rendered to us during the applicable year by the Named Executive Officers. The following table represents compensation recognized for financial reporting purposes for each of the Named Executive Officers in a given year. The "Stock Awards" column lists the cost of restricted stock granted to each of the Named Executive Officers recognized for financial reporting purposes. The "Option Awards" column lists the cost of options granted to each of the Named Executive Officers recognized for financial reporting purposes. In general, restricted stock and stock options are valued at the time of grant with the corresponding cost amortized ratably over the corresponding vesting period. Because we have not historically granted equity awards on an annual basis, we believe that this table more accurately reflects how the Compensation Committee viewed total compensation for each Named Executive Officer when making determinations about individual compensation decisions in 2022. This Historical Compensation Table is not a substitute for the required disclosures included in the Summary Compensation Table set forth following this Historical Compensation Table.

Historical Compensation Table


Name and Principal Position	Year	Salary ($)(1)	Bonus ($)(2)	Stock Awards ($)(3)	Option Awards ($)(3)	All Other Compensation ($)(5)	Total ($)
Kevin S. Wilson Chief Executive Officer and President	2022 2021 2020	961,539 825,758 600,000	— 1,000,000 500,000	3,852,368 4,286,272 2,047,485	1,525,960 1,029,425 267,391	26,629 13,308 11,239	6,366,496 7,154,762 3,426,115
Catherine I. Grassman Executive Vice President, Chief Financial Officer	2022 2021 2020	373,077 325,000 314,792	150,000 245,000 220,000	257,050 444,549 242,660	105,139 454,338 431,306	13,383 13,298 9,743	898,649 1,482,185 1,218,500
Steven M. Eyl Executive Vice President, Chief Commercial Officer and President, scil animal care company	2022 2021 2020	356,731 350,000 335,417	105,000 225,000 175,000	336,420 876,760 641,262	335,488 604,989 625,258	13,549 12,633 10,920	1,147,188 2,069,381 1,787,857
Eleanor F. Baker Executive Vice President, Managing Director and Chief Operating Officer, scil animal care company	2022 2021 2020	340,962 300,000 273,750	115,000 225,000 195,000	251,398 245,541 198,630	236,041 562,141 347,646	11,811 10,647 49,778	955,212 1,343,329 1,064,804
Christopher D. Sveen Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary of Heska Corporation, President, Diamond Animal Health	2022 2021	340,962 300,000	105,000 225,000	251,398 245,541	136,053 516,636	11,930 11,407	845,343 1,298,584

The following table sets forth compensation for services rendered to us during the applicable year by the Named Executive Officers in accordance with the requirements under Item 402(c) of Regulation S-K. The following table contains the same information as above with the exception of the columns entitled "Stock Awards" and "Option Awards." "Stock Awards" in the following table represent the grant date fair value for all stock grants for a given individual in a given year rather than the cost of stock grants for such individual recognized in such year for financial reporting purposes. "Option Awards" in the following table represent the grant date option value for all stock options granted to a given individual in a given year rather than the cost of stock option grants for such individual recognized in such year for financial reporting purposes.

Summary Compensation Table


Name and Principal Position	Year	Salary ($)(1)	Bonus ($)(2)	Stock Awards ($)(4)	Option Awards ($)(4)	All Other Compensation ($)(5)	Total ($)
Kevin S. Wilson Chief Executive Officer and President	2022 2021 2020	961,539 825,758 600,000	— 1,000,000 500,000	— 14,880,000 599,932	— 2,631,402 —	26,629 13,308 11,239	988,167 19,350,468 1,711,172
Catherine I. Grassman Executive Vice President, Chief Financial Officer	2022 2021 2020	373,077 325,000 314,792	150,000 245,000 220,000	799,904 — —	— — 1,130,438	13,383 13,298 9,743	1,336,364 583,298 1,674,972
Steven M. Eyl Executive Vice President, Chief Commercial Officer and President, scil animal care company	2022 2021 2020	356,731 350,000 335,417	105,000 225,000 175,000	699,885 — 1,394,600	— — 1,256,114	13,549 12,633 10,920	1,175,165 587,633 3,172,051
Eleanor F. Baker Executive Vice President, Managing Director and Chief Operating Officer, scil animal care company	2022 2021 2020	340,962 300,000 273,750	115,000 225,000 195,000	699,885 — —	— — 1,130,438	11,811 10,647 49,778	1,167,657 535,647 1,648,966
Christopher D. Sveen Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary of Heska Corporation, President, Diamond Animal Health	2022 2021	340,962 300,000	105,000 225,000	699,885 —	— —	11,930 11,407	1,157,776 536,407

(1)Salary includes amounts, if any, deferred pursuant to our 401(k) plan.

(2)Amounts earned pursuant to cash payouts under our MIP. Amounts indicated are for the year in which compensation was earned. For Ms. Grassman, Ms. Baker, and Mr. Sveen, in 2020 only, this amount also includes a discretionary bonus of $75,000, $75,000, and $50,000, respectively, paid in connection with the Company’s acquisition of scil animal care company.

(3)Represents cost recognized in each year for financial reporting purposes, based on estimates determined under valuation techniques meeting the requirements of Accounting Standards Codification (ASC) Topic 718.

(4)For 2022, represents the grant date fair value of stock awards and option awards calculated in accordance with ASC Topic 718, disregarding estimated forfeitures and, with respect to awards that vest subject to achievement of performance conditions, assumes 100% achievement of those performance conditions. A more detailed description of our grant date fair value calculations can be found in our 2022 Form 10-K in our Note 12 "Capital Stock" of the Notes to Consolidated Financial Statements.

(5)Includes life insurance premiums, short-term and long-term disability premiums and 401(k) matching contributions made by the Company.

Grants of Plan-Based Awards in Last Fiscal Year

The following table shows the equity awards granted in the fiscal year ended December 31, 2022 to the Named Executive Officers.

Grants of Plan-Based Awards


Name	Grant Date	Estimated Future Payouts Under Equity Incentive Plan Awards			Grant Date Fair Value of Stock and Option Awards ($)
		Threshold (#)	Target (#) (1)	Maximum (#)
Kevin S. Wilson	—	—	—	—	—
Catherine I. Grassman	2/17/2022	—	6,294	—	799,904
Steven M. Eyl	2/17/2022	—	5,507	—	699,885
Eleanor F. Baker	2/17/2022	—	5,507	—	699,885
Christopher D. Sveen	2/17/2022	—	5,507	—	699,885

(1)Represent performance-based restricted stock awards that are subject to gross margin and revenue targets. See “Compensation Discussion and Analysis—Long-Term Equity Compensation—2022 LTI Awards” for more information regarding these awards.

Outstanding Equity Awards at Fiscal Year-End

The following table shows unexercised stock options and unvested stock awards held as of December 31, 2022 by the Named Executive Officers.


	Option Awards					Stock Awards
Name	Number of Securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable (1)	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price ($)	Option Expiration Date (2)	Number of Shares or Units of Stock That Have Not Vested (#)	Market Value of Shares or Units of Stock That Have Not Vested ($) (16)	Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)	Equity Incentive Plan Awards Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (16)
Kevin S. Wilson	20,851	—	—	69.77	—	—	—	28,125 (4)	1,748,250
	—	—	34,800 (10)	198.40	6/8/2026	—	—	8,250 (6)	512,820
	—	—	—	—	—	—	—	180,000 (3)	11,188,800
Catherine I. Grassman	5,000	—	—	69.77	3/6/2028	—	—	962 (6)	59,798
	10,000	—	—	70.10	5/31/2029	—	—	3,280 (4)	203,885
	10,000	—	—	60.94	4/15/2030	—	—	906 (11)	56,317
	11,250	—	23,750 (8)	60.94	4/15/2030	—	—	1,329 (6)	82,611
	—	—	—	—	—	—	—	4,531(4)	281,647
	—	—	—	—	—	—	—	3,148 (5)	195,680
	—	—	—	—	—	—	—	3,146 (7)	195,555
Steven M. Eyl	9,063	—	—	72.85	12/28/2026	—	—	2,291 (6)	142,409
	4,959	—	—	39.76	12/28/2025	—	—	7,813 (4)	485,656
	1,146	—	—	18.13	12/30/2024	—	—	5,000 (12)	310,800
	20,000	—	—	69.77	3/6/2028	—	—	5,000 (13)	310,800
	30,000	—	—	60.94	4/15/2030	—	—	7,500 (14)	466,200
	20,000	—	—	60.94	4/15/2030	—	—	2,754 (5)	171,189
	—	—	—	—	—	—	—	2,753 (7)	171,126
Eleanor F. Baker	1,500	—	—	98.95	10/23/2028	—	—	750 (9)	46,620
	12,000	—	—	71.84	9/23/2029	—	—	3,750 (4)	233,100
	10,000	—	—	60.94	4/15/2030	—	—	1,100 (6)	68,376
	12,500	—	22,500 (15)	60.94	4/15/2030	—	—	2,754 (5)	171,189
	—	—	—	—	—	—	—	2,753 (7)	171,126
Christopher D. Sveen	12,000	—	—	71.84	9/23/2029	—	—	750 (9)	46,620
	10,000	—	—	60.94	4/15/2030	—	—	3,750 (4)	233,100
	10,000	—	25,000 (17)	60.94	4/15/2030	—	—	1,100 (6)	68,376
	—	—	—	—	—	—	—	2,754 (5)	171,189
	—	—	—	—	—	—	—	2,753 (7)	171,126

(1)Unless otherwise noted, all unexercisable options reported in this column are to vest and become exercisable in equal monthly amounts until the final monthly vesting date, when all options will be vested and exercisable, which is to occur one day following the day six years prior to the listed option expiration date.

(2)Options are subject to earlier termination in certain events related to termination of service.

(3)To vest upon achievement of revenue, gross margin and adjusted EBITDA measures, with 60,000 becoming earned if “target” levels of each performance metric are achieved and an aggregate of 180,000 becoming earned only if “maximum” levels of each performance metric are achieved.

(4)To vest in three equal tranches upon the Company achieving fiscal year Operating Income results of $25 million, $30 million and $35 million and which may vest no sooner than the date the Company’s independent registered public accountants issue their financial report for the preceding fiscal year in which the proposed vesting result has been achieved, subject to other vesting provisions in the related restricted stock grant agreement.

(5)To vest in two equal tranches upon the Company achieving fiscal year Revenue results of $300 million and $350 million and which is to vest no sooner than the date the Company’s independent registered public accountants issue their financial report for the preceding fiscal year in which the proposed vesting result has been achieved, subject to other vesting provisions in the related restricted stock grant agreement.

(6)To vest upon the Company achieving fiscal year Revenue results of $260 million and which is to vest no sooner than the date the Company’s independent registered public accountants issue their financial report for the preceding fiscal year in which the proposed vesting result has been achieved, subject to other vesting provisions in the related restricted stock grant agreement.

(7)To vest in two equal tranches upon the Company achieving fiscal year Gross Margin results of 44.5% and 45.5% and which is to vest no sooner than the date the Company’s independent registered public accountants issue their financial report for the preceding fiscal year in which the proposed vesting result has been achieved, subject to other vesting provisions in the related restricted stock grant agreement.

(8)10,000 to vest upon attainment of specified full-year gross margin targets, 7,500 of which vests on attainment of International Segment EBITDA targets, and 6,250 to vest upon attainment of consolidated EBITDA targets, in each case by Dec. 31, 2023 and subject to the Named Executive Officer’s continued employment.

(9)Represents shares for which the market-based performance condition have been met and are to vest on September 24, 2023.

(10)To vest on achievement of specified stock price targets, with 17,400 becoming earned if “target” levels of the performance metric are achieved and 34,800 becoming earned only if “maximum” levels of the performance metric are achieved.

(11)Represents shares for which the market-based performance condition have been met and are to vest on June 1, 2023.

(12)To vest in two equal tranches upon the Company achieving fiscal year Gross Margin results of 45% and 47%, which may vest on the date the Company’s independent registered public accountants issue their financial report for the preceding fiscal year in which the proposed vesting result has been achieved, subject to other vesting provisions in the related restricted stock grant agreement.

(13)To vest in two equal tranches upon the Company achieving fiscal year EBITDA results of $15.0MM USD and $20.0MM USD, which may vest on the date the Company’s independent registered public accountants issue their financial report for the preceding fiscal year in which the proposed vesting result has been achieved, subject to other vesting provisions in the related restricted stock grant agreement.

(14)To vest in three equal tranches upon the Company achieving fiscal year International Segment EBITDA results of $6.0MM USD, $7.0MM USD, and $8.0MM USD, which may vest on the date the Company’s independent registered public accountants issue their financial report for the preceding fiscal year in which the proposed vesting result has been achieved, subject to other vesting provisions in the related restricted stock grant agreement.

(15)10,000 to vest upon attainment of specified full-year gross margin targets and 12,500 of which vests on attainment of International Segment EBITDA targets, in each case by Dec. 31, 2023 and subject to the Named Executive Officer’s continued employment.

(16)Reflects the value of unvested restricted stock awards as of December 30, 2022 based on the closing market price per share of our stock on such date of $62.16.

(17)10,000 to vest upon attainment of specified full-year gross margin targets, and 15,000 of which vests on attainment of EBITDA targets, in each case by December 31, 2023 and subject to the Named Executive Officer’s continued employment.

Option Exercises and Stock Vested

The following table shows aggregate exercises of stock options and vesting of restricted shares in the fiscal year ended December 31, 2022 for each of the Named Executive Officers.

Option Awards

Stock Awards

Name

Number of
Shares
Acquired
on Exercise
(#)

Value Realized
on Exercise
($) (1)

Number of
Shares
Acquired
on Vesting
(#)

Value Realized
On Vesting
($) (2)

Kevin S. Wilson

45,149

4,896,049

29,750

SEC Form DEF 14A filed by Heska Corporation