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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-10787
VETERINARY CENTERS OF AMERICA, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 95-4097995
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
12401 WEST OLYMPIC BOULEVARD
LOS ANGELES, CALIFORNIA 90064-1022
(Address of principal executive offices and zip code)
(310) 584-6500
(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
Common stock, $.001 par value
Preferred Stock Purchase Rights
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No .
--------- --------
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
Amendment to this Form 10-K. [ ]
At March 15, 2000, there were outstanding 21,771,726 shares of the Common
Stock of Registrant and the aggregate market value of the shares held on that
date by non-affiliates of Registrant, based on the closing price ($11.81 per
share) of the Registrant's Common Stock on the NASDAQ National Market, was
$254,913,750. For purposes of this computation, it has been assumed that the
shares beneficially held by directors and officers of Registrant were "held
by affiliates;" this assumption is not to be deemed to be an admission by
such persons that they are affiliates of Registrant.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of Registrant's Proxy Statement relating to its 1999 Annual Meeting
of Stockholders are incorporated by reference in Part III of this Annual
Report.
<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a) Exhibits:
See attached Exhibit Index.
(b) Financial Statement Schedules:
Report of Independent Public Accounts
Schedules for the years ended December 31, 1998, 1997, 1996
II - Valuation and Qualifying Accounts
Schedules other than those listed above are omitted since they are not
applicable, not required or the information required to be set forth
herein is included in the consolidated financial statements or notes
thereto.
(c) Reports on Form 8-K:
None
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EXHIBIT INDEX
ITEM NO. EXHIBIT
3.1 Certificate of Incorporation of Registrant, as amended to date (1)
3.2 Bylaws of Registrant, as currently in effect (2)
4.1 Specimen certificate evidencing Common Stock of Registrant (3)
4.2 Indenture dated as of April 17, 1996 between Veterinary Centers of
America, Inc. and the Chase Manhattan Bank, N.A. (4)
4.3 Form of Rights Agreement, dated as of December 30, 1997, between
the Corporation and Continental Stock Transfer & Trust Company as
Rights Agent (5)
4.4 Certificate of Designation of Rights, Preferences and Privileges of
Preferred Stock (5)
4.5 Form of Rights Certificate (5)
10.1 1987 Stock Option Plan of Company and form of Stock Option
Agreement used therewith, as amended (6)
10.2 Form of Indemnification Agreement between the Company and its
Directors (2)
10.3 Amended and Restated Employment Agreement made and entered into as
of February 1, 1997, by and between Robert L. Antin and the Company
10.4 Amended and Restated Employment Agreement made and entered into as
of February 1, 1997, by and between Arthur J. Antin and the Company
10.5 Amended and Restated Employment Agreement made and entered into as
of February 1, 1997, by and between Neil Tauber and the Company
10.6 Partnership Agreement, dated January 1, 1993, of Specialty Pet
Products Partners (6)
10.7 1993 Incentive Stock Plan of the Company and form of Stock Plan
Option Agreement used therewith (7)
10.8 First Amendment to Partnership Agreement, dated as of January 11,
1995 by and between HPP Specialty Pet Products Inc. and VCA
Specialty Pet Products, Inc. (8)
10.9 Letter Agreement dated September 9, 1996 between VCA Specialty Pet
Products, Inc., Veterinary Centers of America, Inc. HPP Specialty
Pet Products, Inc. and Heinz Pet Products (9)
10.10 Restructuring Agreement between HPP Specialty Products, Inc., Heinz
Pet Products, VCA Specialty Products, Inc. and Veterinary Centers
of America, Inc. (9)
10.11 VCA 1996 Stock Incentive Plan (4)
10.12 VCA 1996 Employee Stock Purchase Plan (4)
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21.1 Subsidiaries of Registrant
23.1 Consent of Arthur Andersen LLP (10)
27.1 Financial Data Schedule (10)
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(1) Incorporated by reference from Registrant's Report on Form 10-K/A,
Amendment No. 1, for the year ended December 31, 1996
(2) Incorporated by reference from Registrant's Registration Statement
on Form S-1, File No. 33-40095
(3) Incorporated by reference from Registrant's Registration Statement
on Form S-1, File No. 33-42504
(4) Incorporated by reference from Registrant's Registration Statement
on Form S-4, File No. 333-6667
(5) Incorporated by reference from Registrant's Report on Form 8-K
filed on January 5, 1998
(6) Incorporated by reference from Registrant's Report on Form 10-KSB,
for the year ended December 31, 1992
(7) Incorporated by reference from Registrant's Report on Form 10-KSB,
for the year ended December 31, 1993
(8) Incorporated by reference from Registrant's Report on Form 10-KSB,
for the year ended December 31, 1994
(9) Incorporated by reference from Registrant's Report on Form 10-K for
the year ended December 31, 1996
(10) Incorporated by reference from Registrant's Report on Form 10-K for
the year ended December 31, 1998
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<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized, this 29th
day of March, 2000.
VETERINARY CENTERS OF AMERICA, INC.
(Registrant)
By: /S/ ROBERT L. ANTIN
-----------------------------------
Robert L. Antin
Its: President
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Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the Registrant and in the capacities indicated and on the dates indicated.
<TABLE>
SIGNATURE TITLE DATE
<S> <C> <C>
President, Chief Executive Officer
and Chairman of the Board
(Principal Executive
/S/ ROBERT L. ANTIN Officer and Director) March 29, 2000
- --------------------------------
Robert L. Antin
Senior Vice President,
Chief Operating Officer,
* Secretary and Director March 29, 2000
- --------------------------------
Arthur J. Antin
Senior Vice President,
* Treasurer and Director March 29, 2000
- --------------------------------
Neil Tauber
Vice President,
Chief Financial Officer
and Assistant Secretary
* (Principal Accounting Officer) March 29, 2000
- --------------------------------
Tomas W. Fuller
Director
- --------------------------------
John Heil
* Director March 29, 2000
- --------------------------------
John Chickering
- -------------------------------- Director
Dr. Richard Gillespie
</TABLE>
*By: /S/ ROBERT L. ANTIN
--------------------
Robert L. Antin, Attorney-In-Fact
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (the "Amended Agreement") is
made and entered into as of the 1st day of February 1997, by and between
Veterinary Centers of America, Inc., a Delaware corporation (the "Company") and
Robert L. Antin, an individual ("Officer").
R E C I T A L S
A. Officer is currently employed as Chairman of the Board, Chief Executive
Officer and President of the Company pursuant to an Employment Agreement (the
"Employment Agreement") between the Company and Officer dated as of January 1,
1994.
B. The Company and Officer desire to amend and restate the Employment
Agreement regarding the terms and conditions of Officer's employment by the
Company.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing recitals and the terms,
covenants and conditions contained herein, the Company and Officer agree as
follows:
1. EMPLOYMENT.
Company hereby employs Officer, and Officer hereby accepts such employment,
as Chairman of the Board, Chief Executive Officer and President of the Company,
on the terms and subject to the conditions set forth herein.
2. CAPACITY AND DUTIES.
2.1 Officer shall serve the Company as its Chairman of the Board, Chief
Executive Officer and President and shall report directly to the Board of
Directors of the Company (the "Board of Directors").
2.2 Subject to the direction and control of the Board of Directors, Officer
shall have the full authority and responsibility to operate and manage, on a day
to day basis, the business and affairs of the Company, and shall perform such
other duties and responsibilities as are currently prescribed by the Bylaws of
the Company and which are customarily vested in the office of chief executive
officer of a corporation.
2.3 Officer shall devote his business time, energy and efforts faithfully
and diligently to promote the Company's interests.
2.4 The terms of this Section 2. shall not prevent Officer from investing
or otherwise managing his assets in such form or manner as he chooses and
spending such time, whether or not during business hours, as he deems necessary
to manage his investments, so long as he is able to fulfill his duties pursuant
to Section 2. above.
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2.5 Except for routine travel incident to the business of the Company,
Officer shall perform his duties and obligations under this Amended Agreement
principally from an office provided by the Company in Los Angeles, California or
the surrounding area.
3. TERM.
This Amended Agreement shall be effective as of February 1, 1997 (the
"Effective Date") and shall govern Officer's employment from and after such
date. Officer's employment shall terminate on January 31, 2002 unless sooner
terminated in accordance with the provisions of this Amended Agreement or
extended by an amendment executed by the Company and the Officer (the "Term").
4. COMPENSATION.
4.1 BASE SALARY.
4.1.1 As compensation for services rendered under this Amended
Agreement, the Company shall pay to Officer a base salary (the "Base Salary")
computed in accordance with Sections 4.1.2 below during the term of this Amended
Agreement, payable in accordance with the normal payroll procedures of the
Company.
4.1.2 During the term of this Amended Agreement, Officer's Base Salary
shall be $265,000 and shall be adjusted as provided in this Section. Commencing
on February 1, 1997 and on each anniversary thereafter, or from time to time at
the sole discretion of the Compensation Committee of the Board of Directors (the
"Compensation Committee"), Officer's Base Salary shall be reviewed by the
Compensation Committee and may be increased, but may never be decreased, in the
sole discretion of the Compensation Committee. In determining whether to
increase Officer's Base Salary the Compensation Committee shall engage a
reputable compensation consulting firm to determine comparable compensation
packages provided to executives in similarly situated companies.
4.1.3 The Company may deduct from the Base Salary amounts sufficient
to cover applicable federal, state and/or local income tax withholdings and any
other amounts which the Company is required to withhold by applicable law.
4.2 CASH BONUS PLAN. The Compensation Committee shall adopt a cash bonus
plan designed to provide Officer an opportunity to earn annual cash bonuses
during each calendar year during his employment which, when added to Officer's
Base Salary, shall provide Officer a level of compensation comparable to
compensation generally prevailing for other chief executive officers of publicly
traded companies which are comparable to the Company. The factors to be used to
select which companies are comparable to that of the Company shall include, but
not be limited to, industry group, revenues, operating income, growth rate,
number of employees and location. The annual performance goals to be met in
order to earn portions or all of the bonus provided under the plan shall be
determined through consultation between the Officer and the Compensation
Committee. If requested by the Compensation Committee or Officer, the Company
shall retain a reputable, nationally recognized compensation consultant to
assist the Compensation Committee in
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identifying comparable companies and to make recommendations regarding the
structure and amount of the cash bonus plan.
4.3 STOCK OPTIONS. Officer shall be granted options to purchase 900,000
shares of the Common Stock of the Company with an exercise price of $10.25 per
share (the closing sales price on the National Market System on January 31,
1997, the trading day immediately prior to approval of this Agreement by the
Compensation Committee of the Board of Directors). The options shall vest in 60
equal monthly installments on the first day of each month commencing on July 1,
1997. The options granted pursuant to this Section 4.3 shall be in lieu of any
other options granted to Officer during the term of this Amended Agreement. All
options to purchase the Company's Common Stock granted to Officer whether
pursuant to a Company Stock Option Plan or otherwise and notwithstanding the
provisions of any other agreement to the contrary, may be exercised by Officer
or by Officer's family by delivery of a promissory note in the amount of the
total exercise price of the option (the "Exercise Price"). The promissory note
shall bear interest at the then current thirty year U.S. treasury bond rate,
shall be nonrecourse except to the security referred to in the following clause,
shall be secured by the Common Stock of the Company so purchased, and shall be
payable in full (principal and interest) on the fourth anniversary of the date
of the purchase of the shares. Notwithstanding the foregoing, Officer shall
apply all proceeds from the sale of the shares so purchased by delivery of a
promissory note to the repayment of principal and interest outstanding under the
note until all principal and interest is paid in full. The Company shall
maintain an effective registration statement covering the shares underlying the
options granted to Officer whether pursuant to a Company Stock Option Plan or
otherwise.
4.4 BENEFITS.
4.4.1 VACATION. Officer shall be entitled to five weeks paid vacation
for each calendar year during Officer's employment; PROVIDED, HOWEVER, that
vacation shall only be taken at such times as not to interfere with the
necessary performance of Officer's duties and obligations under this Amended
Agreement.
4.4.2 AUTOMOBILE. The Company shall provide Officer with the use of a
luxury automobile that is selected by Officer and approved by the Compensation
Committee, the cost (the "Automobile Cost") of which during the first year of
the Term shall not be less than the cost that the Company currently provides for
Officer's use of an automobile. Commencing February 1, 1998 and continuing
annually thereafter, the Automobile Cost may, at Officer's sole discretion, be
increased 5% per annum. On the earlier of significant damage or destruction or
attaining three years of age, the Company shall replace such automobile with a
new automobile selected by Officer and approved by the Compensation Committee.
The Company shall pay all costs of insurance, repair, maintenance and operation
of such automobile. At the end of the three year period referred to herein,
Officer may, but is not obligated to, purchase the automobile for the book value
of the automobile on the Company's financial records.
4.4.3 CLUB MEMBERSHIPS. The Company shall pay monthly dues for
Officer's membership in clubs selected by Officer, provided the aggregate of
such monthly dues do not exceed $1,000.00 per month during the first year of the
Term. Commencing February 1, 1998 and continuing annually thereafter, such
monthly dues may, at Officer's sole discretion, increase 5% per annum.
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4.4.4 OTHER BENEFITS; INSURANCE. During the term of Officer's
employment under this Amended Agreement, if and to the extent eligible, Officer
shall be entitled to participate in all operative employee benefit and welfare
plans of the Company then in effect ("Company Officer Benefit Plans"),
including, to the extent then in effect, group life, medical, disability and
other insurance plans, all on the same basis generally applicable to the
executives of the Company; PROVIDED, HOWEVER, that nothing contained in this
Section 4.4.4 shall, in any manner whatsoever, directly or indirectly, require
or otherwise prohibit the Company from amending, modifying, curtailing,
discontinuing or otherwise terminating, any Company Officer Benefit Plan at any
time (whether during or after the term hereof) except that the Company will at
all times during the term hereof and any severance period referred to in Section
8. hereof maintain medical insurance covering Officer and his dependents with
benefits at least as favorable as those provided by the Company as of the date
hereof. In addition to, and not in lieu of, any Company Officer Benefit Plan,
during the term of Officer's employment hereunder, the Company shall contribute
an amount equal to at least 20% of Officer's cash compensation to the payment of
premiums on a split dollar life insurance policy (the "Split Dollar
Contribution") for the benefit of Officer and his estate. Commencing on February
1, 1997 and on each anniversary thereafter, or from time to time at the sole
discretion of the Compensation Committee, the Split Dollar Contribution shall be
reviewed by the Compensation Committee and may be increased, but may never be
decreased, in the sole discretion of the Compensation Committee. In determining
whether to increase the Split Dollar Contribution the Compensation Committee
shall engage a reputable compensation consulting firm to determine comparable
provisions contained in compensation packages provided to executives in
similarly situated companies.
4.4.5 REIMBURSEMENT. Officer shall be entitled to reimbursement from
the Company for the reasonable costs and expenses incurred in connection with
the performance of the duties and obligations provided for in this Amended
Agreement. Additionally, Officer shall be entitled to reimbursement for
reasonable attorneys fees incurred in connection with the receipt of advice from
attorneys, accountants or financial planners regarding the exercise of stock
options to purchase common stock of the Company. Reimbursement shall be paid
upon prompt presentation of expense statements or vouchers and such other
supporting information as the Company may from time to time require.
5. INDEMNIFICATION.
The Company and Executive are parties to an Indemnification Agreement,
pursuant to which, INTER ALIA, the Company has agreed, on the terms and
conditions therein set forth, to indemnify Executive against certain claims
arising by reason of the fact that he is or was an officer or director of the
Company.
6. TRADE SECRETS.
Officer will not at any time during the term hereof and for the three year
period thereafter, in any fashion, form, or manner, unless specifically
consented to in writing by the Company, either directly or indirectly use or
divulge, disclose or communicate to any person, firm or corporation, any
confidential information of any kind, nature or description concerning any
matters affecting or relating to the business of the Company, except in the
ordinary course of the Company's business. All equipment, notebooks, documents,
memoranda, report, files, samples, books, correspondence,
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lists, other written and graphic records, and the like, affecting or relating to
the business of the Company, which Officer shall prepare, use, construct,
observe, possess or control, shall be and remain the Company's sole property.
Officer's obligation under the preceding sentence shall continue in effect after
the end of Officer's employment with the Company and the obligations shall be
binding on Officer's assigns, heirs, executors, administrators, and other legal
representatives.
7. RETURN OF CORPORATE PROPERTY AND TRADE SECRETS.
Upon termination of this Amended Agreement for any reason, Officer, or his
estate in the event of his death, shall turn over to the Company all
correspondence, property, writings or documents then in his possession or
custody belonging to or relating to the affairs of the Company or any of its
subsidiaries or affiliates or comprising or relating to the Trade Secrets.
8. TERMINATION OF EMPLOYMENT
8.1 TERMINATION IN CASE OF DEATH.
8.1.1 Officer's employment hereunder shall terminate immediately upon
the death of Officer.
8.1.2 Upon termination of this Officer's employment pursuant to this
Section 8.1, the Company shall pay to Officer's estate, on the Termination Date,
a lump sum payment of an amount equal to (x) all accrued and unpaid salary and
other compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date. In addition to the foregoing, and notwithstanding the
provisions of any other agreement to the contrary, (x) all options to purchase
the Common Stock of the Company which have been granted to Officer and which
would have vested during the 24 months following the date of termination shall
become immediately exercisable on the Termination Date and, notwithstanding any
other agreement to the contrary, shall remain exercisable for the full term of
each such option, and (y) the Company shall continue to provide for the benefit
of Officer's family the medical benefits referred to in Section 4.4.4 hereof for
60 months following the Termination Date.
8.2 TERMINATION IN CASE OF DISABILITY.
8.2.1 If Officer suffers a physical or mental disability which results
in Officer being unable to perform his duties hereunder for a 26 consecutive
week period, then the Board of Directors shall select a qualified physician to
examine Officer and review his physical and mental capacity. If such physician
determines in good faith that such physical or mental disability renders Officer
incapable of performing his duties hereunder for a period of at least 26
consecutive weeks following the date of such physician's written opinion, then
Officer's employment shall terminate effective 26 weeks following the date of
such physician's written opinion.
8.2.2 Upon termination of Officer's employment pursuant to this
Section 8.2, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and
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all accrued and unused vacation and sick pay payable to Officer by the Company
with respect to services rendered by Officer to the Company through the
Termination Date, and (y) the amount Officer would have earned as Base Salary
during the five years following the Termination Date; provided however, such
amount shall be reduced by the amount of any payments to be paid to Officer
under any long-term disability insurance policy maintained by the Company for
the benefit of Officer pursuant to Section 4.4.4. In addition to the foregoing,
and notwithstanding the provisions of any other agreement to the contrary, (x)
all options to purchase the Common Stock of the Company which have been granted
to Officer and which would have vested during the 24 months following the date
of termination shall become immediately exercisable on the Termination Date and,
notwithstanding any other agreement to the contrary, shall remain exercisable
for the full term of each such option, and (y) the Company shall continue to
provide to Officer all other benefits referred to in Sections 4.4.2, 4.4.3 and
4.4.4 hereof for 60 months following the Termination Date.
8.3 TERMINATION BY OFFICER FOR CAUSE.
8.3.1 The employment of Officer hereunder shall terminate immediately
upon written notice delivered by Officer to the Company upon the occurrence of
any of the following events:
8.3.1.1 The willful breach of any of the material obligations of
the Company to Officer under this Amended Agreement.
8.3.1.2 The Company's chief executive offices are moved to a
location outside of Los Angeles County, California; or
8.3.1.3 Officer fails to be reelected to, or is removed from, the
Board of Directors of the Company.
8.3.2 Upon termination of Officer's employment pursuant to this
Section 8.3, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date, plus an amount equal to five times (i) in the event no
previous bonus has been paid or is payable pursuant to this Amended Agreement,
20% of Officer's Base Salary, or (ii) in the event at least one bonus has been
paid or is payable to Officer, the average bonus based on all bonuses paid or
payable to Officer pursuant to this Amended Agreement. In addition to the
foregoing, and notwithstanding the provisions of any other agreement to the
contrary, (x) all options to purchase the Common Stock of the Company which have
been granted to Officer and which would have vested during the 36 months
following the date of termination shall become immediately exercisable on the
Termination Date and, notwithstanding any other agreement to the contrary, shall
remain exercisable for the full term of each such option, and (y) the Company
shall continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the 60
months following the Termination Date.
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8.4 TERMINATION BY OFFICER WITHOUT CAUSE.
8.4.1 This Amended Agreement shall terminate immediately upon delivery
to the Company of written notice of termination by Officer without cause.
8.4.2 Upon termination of this Amended Agreement pursuant to this
Section 8.4, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date.
8.5 TERMINATION BY THE COMPANY WITHOUT CAUSE.
8.5.1 The employment of Officer shall terminate immediately upon
delivery to Officer of written notice of termination by the Company, which shall
be deemed to be "without cause" unless termination is expressly stated to be
pursuant to Sections 8.1 or 8.2.
8.5.2 Upon termination of this Officer's employment pursuant to this
Section 8.5, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date, plus an amount equal to five times (i) in the event no
previous bonus has been paid or is payable pursuant to this Amended Agreement,
20% of Officer's Base Salary, or (ii) in the event at least one bonus has been
paid or is payable to Officer, the average bonus based on all bonuses paid or
payable to Officer pursuant to this Amended Agreement. In addition to the
foregoing, and notwithstanding the provisions of any other agreement to the
contrary, (x) all options to purchase the Common Stock of the Company which have
been granted to Officer and which would have vested during the 24 months
following the date of termination shall become immediately exercisable on the
Termination Date and, notwithstanding any other agreement to the contrary, shall
remain exercisable for the full term of each such option, and (y) the Company
shall continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the 60
months following the Termination Date.
8.6 TERMINATION UPON THE EXPIRATION OF THE TERM. Upon termination of this
Amended Agreement upon the scheduled expiration of the term pursuant to Section
3. above, the Company shall pay to Officer, on the Termination Date, a lump sum
payment equal to (x) all accrued and unpaid salary and other compensation
payable to Officer by the Company and all accrued and unused vacation and sick
pay payable to Officer by the Company with respect to services rendered by
Officer to the Company through the Termination Date, and (y) the amount Officer
would have earned as Base Salary for the five years following the Termination
Date. In addition to the foregoing, and notwithstanding the provisions of any
other agreement to the contrary, (x) all options to purchase the Common Stock of
the Company which have been granted to Officer and which would have vested
during the 24 months following the date of termination shall become immediately
exercisable on the Termination Date and, notwithstanding any other agreement to
the contrary, shall remain exercisable for the full term of each such option,
and (y) the Company shall
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continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the
twelve months following the Termination Date.
8.7 TERMINATION DATE. For purposes of this Section 8., the term,
"Termination Date", shall mean that date on which Officer's employment is
terminated pursuant to this Section 8.
9. SEVERANCE PAYMENTS UPON CHANGE IN CONTROL.
9.1 SEVERANCE PAYMENT. Upon the occurrence of a Change in Control (as
defined in Section 9.5 below) of the Company, the employment of Officer
hereunder shall terminate and the Company shall pay to Officer in cash, on the
fifth day following the date on which the Change of Control occurs (which for
the purposes of this Section 9. shall be the Termination Date), the following:
9.1.1 All accrued and unpaid salary and other compensation payable to
Officer by the Company for services rendered by Officer to the Company through
the Termination Date;
9.1.2 All accrued and unused vacation and sick pay payable to Officer
by the Company with respect to services rendered by Officer to the Company
through the Termination Date; and
9.1.3 Severance pay in an amount equal to (x) the Base Salary Officer
would have earned during the five years following the Termination Date, and (y)
an amount equal to (i) in the event no previous bonus has been paid or is
payable pursuant to this Amended Agreement, 20% of Officer's Base Salary, or
(ii) in the event at least one bonus has been paid or is payable to Officer, the
average bonus based on all bonuses paid or payable to Officer pursuant to this
Amended Agreement.
9.2 CONTINUATION OF BENEFITS. The Company shall continue for a period of 60
months following the Termination Date, or such longer period of time existing
between the Termination Date and the scheduled expiration of this Amended
Agreement pursuant to Section 3. above, to provide Officer with all benefits
that would have been payable to him pursuant to Sections 4.4.2, 4.4.3 and 4.4.4
hereof if Officer had been employed by the Company during such period.
9.3 VESTING OF OPTIONS. In addition to the foregoing, and notwithstanding
the provisions of any other agreement to the contrary, upon the occurrence of a
Change in Control, all options to purchase Common Stock of the Company which
have been granted to Officer by the Company shall become immediately exercisable
on the Termination Date and, notwithstanding any other agreement to the
contrary, shall remain exercisable for the full term of each such option.
9.4 PROVISION OF SERVICES FOLLOWING CHANGE IN CONTROL. At the request of
the Company, Officer shall continue to serve hereunder for a period of up to 180
days following the Termination Date. If the Company requests Officer to perform
such services, Officer shall be compensated from and after the Termination Date
for the period that Officer actually remains employed by the Company at his then
current Base Salary. Any such amounts payable to Officer shall be in addition to
and not in lieu of the amounts payable to Officer under Section 9.1 above. Upon
the later to
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occur of an occurrence of a Change of Control or the termination of any period
during which Officer continues to provide services as aforesaid, Officer's
employment hereunder shall terminate.
9.5 CHANGE IN CONTROL. For purposes of this Section 9., "Change in Control"
of the Company shall be deemed to have occurred if (a) there shall be
consummated (x) any consolidation or merger of the Company into or with another
Person as such term is used in Sections 13(d)(3) and 14(d)(2) of the Securities
and Exchange Act of 1934, as amended (the "Exchange Act"), in which the Company
is not the continuing or surviving corporation or pursuant to which shares of
the Company's common stock would be converted into cash, securities or other
property, other than a merger of the Company in which the holders of the
Company's common stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving corporation immediately
after the merger, or (y) any sale, lease or other transfer (in one transaction
or a series of related transactions) of all or a significant portion of the
assets of the Company (for purposes of this definition, the sale of the stock or
assets of two or more of the Company's existing subsidiaries shall be deemed to
be a sale of a significant portion of the Company's assets), or (b) the
shareholders of the Company approve any plan or proposal for the liquidation or
dissolution of the Company, or (c) any Person who is not now the owner of 10% or
more of the Company's outstanding equity securities shall become the beneficial
owner (within the meaning of Rule 13d-3 under the Exchange Act) of 20% or more
of the Company's outstanding equity securities, or (d) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the entire board of directors shall cease for any reason to constitute a
majority thereof unless the election, or the nomination for election by the
Company's shareholders, of each new director was approved by a vote of at least
two-thirds of the directors then still in office who were directors in the
beginning of the period.
The parties believe that the payments pursuant to Sections 8 and 9 hereof
do not constitute "Excess Parachute Payments" under Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"). Notwithstanding such belief, if
any benefit under these sections constitutes an "Excess Parachute Payment" the
Company shall pay to Officer an additional amount ("Tax Payment") such that (x)
the excess of all Excess Parachute Payments (including payments under this
sentence) over the sum of excise tax thereon under Section 4999 of the Code and
income tax thereon under Subtitle A of the Code and under applicable state law
is equal to (y) the excess of all Excess Parachute Payments (excluding payments
under this sentence) over income tax thereon under Subtitle A of the Code and
under applicable state law. Such Tax Payment shall be paid to Officer
concurrently with the severance payment referred to in Section 9.1 above.
10. NO MITIGATION.
The payments required to be paid to Officer by Company pursuant to Sections
8. and 9. shall not be reduced by or mitigated by amounts which Officer earns or
is capable of earning during any period following his Termination Date.
11. INJUNCTIVE RELIEF.
Officer hereby recognizes, acknowledges and agrees that in the event of any
breach by Officer of any of his covenants, agreements, duties or obligations
hereunder, the Company would suffer great and irreparable harm, injury and
damage, the Company would encounter extreme
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difficulty in attempting to prove the actual amount of damages suffered by the
Company as a result of such breach, and the Company would not be reasonably or
adequately compensated in damages in any action at law. Officer therefore agrees
that, in addition to any other remedy the Company may have at law, in equity, by
statute or otherwise, in the event of any breach by Officer of any of the
covenants, agreements, duties or obligations hereunder, the Company or its
subsidiaries shall be entitled to seek and receive temporary, preliminary and
permanent injunctive and other equitable relief from any court of competent
jurisdiction to enforce any of the rights of the Company or its subsidiaries or
any of the covenants, agreements, duties or obligations of Officer hereunder, or
otherwise to prevent the violation of any of the terms or provisions hereof, all
without the necessity of proving the amount of any actual damage to the Company
or its subsidiaries thereof resulting therefrom; provided, however, that nothing
contained in this Section 11. shall be deemed or construed in any manner
whatsoever as a waiver by the Company or its subsidiaries of any of the rights
which any of them may have against Officer at law, in equity, by statute or
otherwise arising out of, in connection with or resulting from the breach by
Officer of any of his covenants, agreements, duties or obligations hereunder.
12. MISCELLANEOUS
12.1 ENTIRE AGREEMENT. This Amended Agreement contains the entire
understanding of the parties hereto relating to the subject matter hereof and
cannot be changed or terminated except in writing signed by both Officer and the
Company.
12.2 LIMITED LIABILITIES. All liabilities incurred by Officer in his
capacity as an officer hereunder shall be incurred for the account of the
Company, and Officer shall not be personally liable therefor. Officer shall not
be liable to the Company, or any of its respective subsidiaries, affiliates,
employees, officers, directors, agents, representatives, successors, assigns,
stockholders, and their respective subsidiaries and affiliates, the Company
shall, and hereby agrees to, indemnify, defend and hold Officer harmless from
and against any and all damages and/or loss or liability (including, without
limitation, all costs of defense thereof), for any acts or omissions in the
performance of service under and within the scope of this Amended Agreement on
the part of Officer.
12.3 NOTICES. All notices, requests and other communications (collectively,
"Notices") given pursuant to this Amended Agreement shall be in writing, and
shall be delivered by facsimile transmission with a copy delivered by personal
service or by United States first class, registered or certified mail (return
receipt requested), postage prepaid, addressed to the party at the address set
forth below:
If the Company: Veterinary Centers of America, Inc.
3420 Ocean Park Blvd. Ste. 1000
Santa Monica, CA 90405
Attention: Board of Directors
Facsimile No.: (310) 392-7464
If to Officer: ___________________
___________________
___________________
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Any Notice shall be deemed duly given when received by the addressee thereof,
PROVIDED THAT any Notice sent by registered or certified mail shall be deemed to
have been duly given three days from date of deposit in the United States mails,
unless sooner received. Either party may from time to time change its address
for further Notices hereunder by giving notice to the other party in the manner
prescribed in this Section 12.3.
12.4 GOVERNING LAW. This Amended Agreement has been made and entered into
in the state of California and shall be construed in accordance with the laws of
the State of California without regard to the conflict of laws principles
thereof.
12.5 COUNTERPARTS. This Amended Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
12.6 SEVERABLE PROVISIONS. The provisions of this Amended Agreement are
severable, and if any one or more provisions are determined to be judicially
unenforceable, in whole or in part, the remaining provisions shall nevertheless
be binding and enforceable.
12.7 SUCCESSORS AND ASSIGNS. This Amended Agreement and all obligations and
benefits of Officer and the Company hereunder shall bind and inure to the
benefit of Officer and the Company, their respective affiliates, and their
respective successors and assigns.
12.8 AMENDMENTS AND WAIVERS. No amendment or waiver of any term or
provision of this Amended Agreement shall be effective unless made in writing.
Any written amendment or waiver shall be effective only in the instance given
and then only with respect to the specific term or provision (or portion
thereof) of this Amended Agreement to which it expressly relates, and shall not
be deemed or construed to constitute a waiver of any other term or provision (or
portion thereof) waived in any other instance.
12.9 TITLE AND HEADINGS. The titles and headings contained in this Amended
Agreement are included for convenience only and form no part of the agreement
between the parties.
12.10 SURVIVAL. Notwithstanding anything to the contrary contained herein,
the provisions of Sections 6., 7., 8., 9., 10. and 11. shall survive
the termination of this Amended Agreement.
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IN WITNESS WHEREOF, this Amended Agreement has been executed as of the
date first set forth above.
VETERINARY CENTERS OF AMERICA, INC.
"THE COMPANY"
By: /S/
---------------------------------
Its:
-----------------------------
ACCEPTED AND AGREED TO:
/S/ ROBERT L. ANTIN
- ------------------------------
ROBERT L. ANTIN
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (the "Amended Agreement") is
made and entered into as of the 1st day of February 1997, by and between
Veterinary Centers of America, Inc., a Delaware corporation (the "Company") and
Arthur J. Antin, an individual ("Officer").
R E C I T A L S
A. Officer is currently employed as Chief Operating Officer, Senior Vice
President and Secretary of the Company pursuant to an Employment Agreement (the
"Employment Agreement") between the Company and Officer dated as of January 1,
1994.
B. The Company and Officer desire to amend and restate the Employment
Agreement regarding the terms and conditions of Officer's employment by the
Company.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing recitals and the terms,
covenants and conditions contained herein, the Company and Officer agree as
follows:
1. EMPLOYMENT.
Company hereby employs Officer, and Officer hereby accepts such employment,
as Chief Operating Officer, Senior Vice President and Secretary of the Company,
on the terms and subject to the conditions set forth herein.
2. CAPACITY AND DUTIES.
2.1 Officer shall serve the Company as its Chief Operating Officer, Senior
Vice President and Secretary and shall report directly to the Chief Executive
Officer of the Company.
2.2 Subject to the direction and control of the Chief Executive Officer,
Officer shall perform such duties and responsibilities as are currently
prescribed by the Bylaws of the Company and which are customarily vested in the
office of chief operating officer of a corporation.
2.3 Officer shall devote his business time, energy and efforts faithfully
and diligently to promote the Company's interests.
2.4 The terms of this Section 2. shall not prevent Officer from investing
or otherwise managing his assets in such form or manner as he chooses and
spending such time, whether or not during business hours, as he deems necessary
to manage his investments, so long as he is able to fulfill his duties pursuant
to Section 2. above.
2.5 Except for routine travel incident to the business of the Company,
Officer shall perform his duties and obligations under this Amended Agreement
principally from an office provided by the Company in Los Angeles, California or
the surrounding area.
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3. TERM.
This Amended Agreement shall be effective as of February 1, 1997 (the
"Effective Date") and shall govern Officer's employment from and after such
date. Officer's employment shall terminate on January 31, 2002 unless sooner
terminated in accordance with the provisions of this Amended Agreement or
extended by an amendment executed by the Company and the Officer (the "Term").
4. COMPENSATION.
4.1 BASE SALARY.
4.1.1 As compensation for services rendered under this Amended
Agreement, the Company shall pay to Officer a base salary (the "Base Salary")
computed in accordance with Section 4.1.2 below during the term of this Amended
Agreement, payable in accordance with the normal payroll procedures of the
Company.
4.1.2 During the term of this Amended Agreement, Officer's Base Salary
shall be $189,000 and shall be adjusted as provided in this Section. Commencing
on February 1, 1997 and on each anniversary thereafter, or from time to time at
the sole discretion of the Compensation Committee of the Board of Directors (the
"Compensation Committee"), Officer's Base Salary shall be reviewed by the
Compensation Committee and may be increased, but may never be decreased, in the
sole discretion of the Compensation Committee. In determining whether to
increase Officer's Base Salary the Compensation Committee shall engage a
reputable compensation consulting firm to determine comparable compensation
packages provided to executives in similarly situated companies.
4.1.3 The Company may deduct from the Base Salary amounts sufficient
to cover applicable federal, state and/or local income tax withholdings and any
other amounts which the Company is required to withhold by applicable law.
4.2 CASH BONUS PLAN. The Compensation Committee shall adopt a cash
bonus plan designed to provide Officer an opportunity to earn annual cash
bonuses during each calendar year during his employment which, when added to
Officer's Base Salary, shall provide Officer a level of compensation comparable
to compensation generally prevailing for other chief operating officers of
publicly traded companies which are comparable to the Company. The factors to be
used to select which companies are comparable to that of the Company shall
include, but not be limited to, industry group, revenues, operating income,
growth rate, number of employees and location. The annual performance goals to
be met in order to earn portions or all of the bonus provided under the plan
shall be determined through consultation between the Officer and the
Compensation Committee. If requested by the Compensation Committee or Officer,
the Company shall retain a reputable, nationally recognized compensation
consultant to assist the Compensation Committee in identifying comparable
companies and to make recommendations regarding the structure and amount of the
cash bonus plan.
4.3 STOCK OPTIONS. Officer shall be granted options to purchase 450,000
shares of the Common Stock of the Company with an exercise price of $10.25 per
share (the closing sales price
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on the National Market System on January 31, 1997, the trading day immediately
prior to approval of this Agreement by the Compensation Committee of the Board
of Directors). The options shall vest in 60 equal monthly installments on the
first day of each month commencing on July 1, 1997. The options granted pursuant
to this Section 4.3 shall be in lieu of any other options granted to Officer
during the term of this Amended Agreement. All options to purchase the Company's
Common Stock granted to Officer whether pursuant to a Company Stock Option Plan
or otherwise and notwithstanding the provisions of any other agreement to the
contrary, may be exercised by Officer or by Officer's family by delivery of a
promissory note in the amount of the total exercise price of the option (the
"Exercise Price"). The promissory note shall bear interest at the then current
thirty year U.S. treasury bond rate, shall be nonrecourse except to the security
referred to in the following clause, shall be secured by the Common Stock of the
Company so purchased, and shall be payable in full (principal and interest) on
the fourth anniversary of the date of the purchase of the shares.
Notwithstanding the foregoing, Officer shall apply all proceeds from the sale of
the shares so purchased by delivery of a promissory note to the repayment of
principal and interest outstanding under the note until all principal and
interest is paid in full. The Company shall maintain an effective registration
statement covering the shares underlying the options granted to Officer whether
pursuant to a Company Stock Option Plan or otherwise.
4.4 BENEFITS.
4.4.1 VACATION. Officer shall be entitled to four weeks paid vacation
for each calendar year during Officer's employment; provided, HOWEVER, that
vacation shall only be taken at such times as not to interfere with the
necessary performance of Officer's duties and obligations under this Amended
Agreement.
4.4.2 AUTOMOBILE. The Company shall provide Officer with the use of a
luxury automobile that is selected by Officer and approved by the Compensation
Committee, the cost (the "Automobile Cost") of which during the first year of
the Term shall not be less than the cost that the Company currently provides for
Officer's use of an automobile. Commencing February 1, 1998 and continuing
annually thereafter, the Automobile Cost may, at Officer's sole discretion, be
increased 5% per annum. On the earlier of significant damage or destruction or
attaining three years of age, the Company shall replace such automobile with a
new automobile selected by Officer and approved by the Compensation Committee.
The Company shall pay all costs of insurance, repair, maintenance and operation
of such automobile. At the end of the three year period referred to herein,
Officer may, but is not obligated to, purchase the automobile for the book value
of the automobile on the Company's financial records.
4.4.3 CLUB MEMBERSHIPS. The Company shall pay monthly dues for
Officer's membership in clubs selected by Officer, provided the aggregate of
such monthly dues do not exceed $200.00 per month during the first year of the
Term. Commencing February 1, 1998 and continuing annually thereafter, such
monthly dues may, at Officer's sole discretion, increase 5% per annum.
4.4.4 OTHER BENEFITS; INSURANCE. During the term of Officer's
employment under this Amended Agreement, if and to the extent eligible, Officer
shall be entitled to participate in all operative employee benefit and welfare
plans of the Company then in effect ("Company Officer Benefit Plans"),
including, to the extent then in effect, group life, medical, disability and
other
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insurance plans, all on the same basis generally applicable to the executives of
the Company; PROVIDED, HOWEVER, that nothing contained in this Section 4.4.4
shall, in any manner whatsoever, directly or indirectly, require or otherwise
prohibit the Company from amending, modifying, curtailing, discontinuing or
otherwise terminating, any Company Officer Benefit Plan at any time (whether
during or after the term hereof) except that the Company will at all times
during the term hereof and any severance period referred to in Section 8. hereof
maintain medical insurance covering Officer and his dependents with benefits at
least as favorable as those provided by the Company as of the date hereof. In
addition to, and not in lieu of, any Company Officer Benefit Plan, during the
term of Officer's employment hereunder, the Company shall contribute an amount
equal to at least 20% of Officer's cash compensation to the payment of premiums
on a split dollar life insurance policy (the "Split Dollar Contribution") for
the benefit of Officer and his estate. Commencing on February 1, 1997 and on
each anniversary thereafter, or from time to time at the sole discretion of the
Compensation Committee, the Split Dollar Contribution shall be reviewed by the
Compensation Committee and may be increased, but may never be decreased, in the
sole discretion of the Compensation Committee. In determining whether to
increase the Split Dollar Contribution the Compensation Committee shall engage a
reputable compensation consulting firm to determine comparable provisions
contained in compensation packages provided to executives in similarly situated
companies.
4.4.5 REIMBURSEMENT. Officer shall be entitled to reimbursement from
the Company for the reasonable costs and expenses incurred in connection with
the performance of the duties and obligations provided for in this Amended
Agreement. Additionally, Officer shall be entitled to reimbursement for
reasonable attorneys fees incurred in connection with the receipt of advice from
attorneys, accountants or financial planners regarding the exercise of stock
options to purchase common stock of the Company. Reimbursement shall be paid
upon prompt presentation of expense statements or vouchers and such other
supporting information as the Company may from time to time require.
5. INDEMNIFICATION.
The Company and Executive are parties to an Indemnification Agreement,
pursuant to which, INTER ALIA, the Company has agreed, on the terms and
conditions therein set forth, to indemnify Executive against certain claims
arising by reason of the fact that he is or was an officer or director of the
Company.
6. TRADE SECRETS.
Officer will not at any time during the term hereof and for the three year
period thereafter, in any fashion, form, or manner, unless specifically
consented to in writing by the Company, either directly or indirectly use or
divulge, disclose or communicate to any person, firm or corporation, any
confidential information of any kind, nature or description concerning any
matters affecting or relating to the business of the Company, except in the
ordinary course of the Company's business. All equipment, notebooks, documents,
memoranda, report, files, samples, books, correspondence, lists, other written
and graphic records, and the like, affecting or relating to the business of the
Company, which Officer shall prepare, use, construct, observe, possess or
control, shall be and remain the Company's sole property. Officer's obligation
under the preceding sentence shall
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continue in effect after the end of Officer's employment with the Company and
the obligations shall be binding on Officer's assigns, heirs, executors,
administrators, and other legal representatives.
7. RETURN OF CORPORATE PROPERTY AND TRADE SECRETS.
Upon termination of this Amended Agreement for any reason, Officer, or his
estate in the event of his death, shall turn over to the Company all
correspondence, property, writings or documents then in his possession or
custody belonging to or relating to the affairs of the Company or any of its
subsidiaries or affiliates or comprising or relating to the Trade Secrets.
8. TERMINATION OF EMPLOYMENT
8.1 TERMINATION IN CASE OF DEATH.
8.1.1 Officer's employment hereunder shall terminate immediately upon
the death of Officer.
8.1.2 Upon termination of this Officer's employment pursuant to this
Section 8.1, the Company shall pay to Officer's estate, on the Termination Date,
a lump sum payment of an amount equal to (x) all accrued and unpaid salary and
other compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date. In addition to the foregoing, and notwithstanding the
provisions of any other agreement to the contrary, (x) all options to purchase
the Common Stock of the Company which have been granted to Officer and which
would have vested during the 24 months following the date of termination shall
become immediately exercisable on the Termination Date and, notwithstanding any
other agreement to the contrary, shall remain exercisable for the full term of
each such option, and (y) the Company shall continue to provide for the benefit
of Officer's family the medical benefits referred to in Section 4.4.4 hereof for
60 months following the Termination Date.
8.2 TERMINATION IN CASE OF DISABILITY.
8.2.1 If Officer suffers a physical or mental disability which results
in Officer being unable to perform his duties hereunder for a 26 consecutive
week period, then the Board of Directors shall select a qualified physician to
examine Officer and review his physical and mental capacity. If such physician
determines in good faith that such physical or mental disability renders Officer
incapable of performing his duties hereunder for a period of at least 26
consecutive weeks following the date of such physician's written opinion, then
Officer's employment shall terminate effective 26 weeks following the date of
such physician's written opinion.
8.2.2 Upon termination of Officer's employment pursuant to this
Section 8.2, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date;
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provided however, such amount shall be reduced by the amount of any payments to
be paid to Officer under any long-term disability insurance policy maintained by
the Company for the benefit of Officer pursuant to Section 4.4.4. In addition to
the foregoing, and notwithstanding the provisions of any other agreement to the
contrary, (x) all options to purchase the Common Stock of the Company which have
been granted to Officer and which would have vested during the 24 months
following the date of termination shall become immediately exercisable on the
Termination Date and, notwithstanding any other agreement to the contrary, shall
remain exercisable for the full term of each such option, and (y) the Company
shall continue to provide to Officer all other benefits referred to in Sections
4.4.2, 4.4.3 and 4.4.4 hereof for 60 months following the Termination Date.
8.3 TERMINATION BY OFFICER FOR CAUSE.
8.3.1 The employment of Officer hereunder shall terminate immediately
upon written notice delivered by Officer to the Company upon the occurrence of
any of the following events:
8.3.1.1 The willful breach of any of the material obligations of
the Company to Officer under this Amended Agreement.
8.3.1.2 The Company's chief executive offices are moved to a
location outside of Los Angeles County, California; or
8.3.1.3 Officer fails to be reelected to, or is removed from,
the Board of Directors of the Company.
8.3.2 Upon termination of Officer's employment pursuant to this
Section 8.3, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date, plus an amount equal to five times (i) in the event no
previous bonus has been paid or is payable pursuant to this Amended Agreement,
20% of Officer's Base Salary, or (ii) in the event at least one bonus has been
paid or is payable to Officer, the average bonus based on all bonuses paid or
payable to Officer pursuant to this Amended Agreement. In addition to the
foregoing, and notwithstanding the provisions of any other agreement to the
contrary, (x) all options to purchase the Common Stock of the Company which have
been granted to Officer and which would have vested during the 36 months
following the date of termination shall become immediately exercisable on the
Termination Date and, notwithstanding any other agreement to the contrary, shall
remain exercisable for the full term of each such option, and (y) the Company
shall continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the 60
months following the Termination Date.
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8.4 TERMINATION BY OFFICER WITHOUT CAUSE.
8.4.1 This Amended Agreement shall terminate immediately upon delivery
to the Company of written notice of termination by Officer without cause.
8.4.2 Upon termination of this Amended Agreement pursuant to this
Section 8.4, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date.
8.5 TERMINATION BY THE COMPANY WITHOUT CAUSE.
8.5.1 The employment of Officer shall terminate immediately upon
delivery to Officer of written notice of termination by the Company, which shall
be deemed to be "without cause" unless termination is expressly stated to be
pursuant to Sections 8.1 or 8.2.
8.5.2 Upon termination of this Officer's employment pursuant to this
Section 8.5, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date, plus an amount equal to five times (i) in the event no
previous bonus has been paid or is payable pursuant to this Amended Agreement,
20% of Officer's Base Salary, or (ii) in the event at least one bonus has been
paid or is payable to Officer, the average bonus based on all bonuses paid or
payable to Officer pursuant to this Amended Agreement. In addition to the
foregoing, and notwithstanding the provisions of any other agreement to the
contrary, (x) all options to purchase the Common Stock of the Company which have
been granted to Officer and which would have vested during the 24 months
following the date of termination shall become immediately exercisable on the
Termination Date and, notwithstanding any other agreement to the contrary, shall
remain exercisable for the full term of each such option, and (y) the Company
shall continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the 60
months following the Termination Date.
8.6 TERMINATION UPON THE EXPIRATION OF THE TERM. Upon termination of this
Amended Agreement upon the scheduled expiration of the term pursuant to Section
3. above, the Company shall pay to Officer, on the Termination Date, a lump sum
payment equal to (x) all accrued and unpaid salary and other compensation
payable to Officer by the Company and all accrued and unused vacation and sick
pay payable to Officer by the Company with respect to services rendered by
Officer to the Company through the Termination Date, and (y) the amount Officer
would have earned as Base Salary for the five years following the Termination
Date. In addition to the foregoing, and notwithstanding the provisions of any
other agreement to the contrary, (x) all options to purchase the Common Stock of
the Company which have been granted to Officer and which would have vested
during the 24 months following the date of termination shall become immediately
exercisable on the Termination Date and, notwithstanding any other agreement to
the contrary, shall remain exercisable for the full term of each such option,
and (y) the Company shall
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continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the
twelve months following the Termination Date.
8.7 TERMINATION DATE. For purposes of this Section 8., the term,
"Termination Date", shall mean that date on which Officer's employment is
terminated pursuant to this Section 8.
9. SEVERANCE PAYMENTS UPON CHANGE IN CONTROL.
9.1 SEVERANCE PAYMENT. Upon the occurrence of a Change in Control (as
defined in Section 9.5 below) of the Company, the employment of Officer
hereunder shall terminate and the Company shall pay to Officer in cash, on the
fifth day following the date on which the Change of Control occurs (which for
the purposes of this Section 9. shall be the Termination Date), the following:
9.1.1 All accrued and unpaid salary and other compensation payable to
Officer by the Company for services rendered by Officer to the Company through
the Termination Date;
9.1.2 All accrued and unused vacation and sick pay payable to Officer
by the Company with respect to services rendered by Officer to the Company
through the Termination Date; and
9.1.3 Severance pay in an amount equal to (x) the Base Salary Officer
would have earned during the five years following the Termination Date, and (y)
an amount equal to (i) in the event no previous bonus has been paid or is
payable pursuant to this Amended Agreement, 20% of Officer's Base Salary, or
(ii) in the event at least one bonus has been paid or is payable to Officer, the
average bonus based on all bonuses paid or payable to Officer pursuant to this
Amended Agreement.
9.2 CONTINUATION OF BENEFITS. The Company shall continue for a period of
60 months following the Termination Date, or such longer period of time existing
between the Termination Date and the scheduled expiration of this Amended
Agreement pursuant to Section 3. above, to provide Officer with all benefits
that would have been payable to him pursuant to Sections 4.4.2, 4.4.3 and 4.4.4
hereof if Officer had been employed by the Company during such period.
9.3 VESTING OF OPTIONS. In addition to the foregoing, and notwithstanding
the provisions of any other agreement to the contrary, upon the occurrence of a
Change in Control, all options to purchase Common Stock of the Company which
have been granted to Officer by the Company shall become immediately exercisable
on the Termination Date and, notwithstanding any other agreement to the
contrary, shall remain exercisable for the full term of each such option.
9.4 PROVISION OF SERVICES FOLLOWING CHANGE IN CONTROL. At the request of
the Company, Officer shall continue to serve hereunder for a period of up to 180
days following the Termination Date. If the Company requests Officer to perform
such services, Officer shall be compensated from and after the Termination Date
for the period that Officer actually remains employed by the Company at his then
current Base Salary. Any such amounts payable to Officer shall be in addition to
and not in lieu of the amounts payable to Officer under Section 9.1 above. Upon
the later to
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occur of an occurrence of a Change of Control or the termination of any period
during which Officer continues to provide services as aforesaid, Officer's
employment hereunder shall terminate.
9.5 CHANGE IN CONTROL. For purposes of this Section 9., "Change in Control"
of the Company shall be deemed to have occurred if (a) there shall be
consummated (x) any consolidation or merger of the Company into or with another
Person as such term is used in Sections 13(d)(3) and 14(d)(2) of the Securities
and Exchange Act of 1934, as amended (the "Exchange Act"), in which the Company
is not the continuing or surviving corporation or pursuant to which shares of
the Company's common stock would be converted into cash, securities or other
property, other than a merger of the Company in which the holders of the
Company's common stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving corporation immediately
after the merger, or (y) any sale, lease or other transfer (in one transaction
or a series of related transactions) of all or a significant portion of the
assets of the Company (for purposes of this definition, the sale of the stock or
assets of two or more of the Company's existing subsidiaries shall be deemed to
be a sale of a significant portion of the Company's assets), or (b) the
shareholders of the Company approve any plan or proposal for the liquidation or
dissolution of the Company, or (c) any Person who is not now the owner of 10% or
more of the Company's outstanding equity securities shall become the beneficial
owner (within the meaning of Rule 13d-3 under the Exchange Act) of 20% or more
of the Company's outstanding equity securities, or (d) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the entire board of directors shall cease for any reason to constitute a
majority thereof unless the election, or the nomination for election by the
Company's shareholders, of each new director was approved by a vote of at least
two-thirds of the directors then still in office who were directors in the
beginning of the period.
The parties believe that the payments pursuant to Sections 8 and 9 hereof
do not constitute "Excess Parachute Payments" under Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"). Notwithstanding such belief, if
any benefit under these sections constitutes an "Excess Parachute Payment" the
Company shall pay to Officer an additional amount ("Tax Payment") such that (x)
the excess of all Excess Parachute Payments (including payments under this
sentence) over the sum of excise tax thereon under Section 4999 of the Code and
income tax thereon under Subtitle A of the Code and under applicable state law
is equal to (y) the excess of all Excess Parachute Payments (excluding payments
under this sentence) over income tax thereon under Subtitle A of the Code and
under applicable state law. Such Tax Payment shall be paid to Officer
concurrently with the severance payment referred to in Section 9.1 above.
10. NO MITIGATION.
The payments required to be paid to Officer by Company pursuant to Sections
8. and 9. shall not be reduced by or mitigated by amounts which Officer earns or
is capable of earning during any period following his Termination Date.
11. INJUNCTIVE RELIEF.
Officer hereby recognizes, acknowledges and agrees that in the event of any
breach by Officer of any of his covenants, agreements, duties or obligations
hereunder, the Company would suffer great and irreparable harm, injury and
damage, the Company would encounter extreme
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difficulty in attempting to prove the actual amount of damages suffered by the
Company as a result of such breach, and the Company would not be reasonably or
adequately compensated in damages in any action at law. Officer therefore agrees
that, in addition to any other remedy the Company may have at law, in equity, by
statute or otherwise, in the event of any breach by Officer of any of the
covenants, agreements, duties or obligations hereunder, the Company or its
subsidiaries shall be entitled to seek and receive temporary, preliminary and
permanent injunctive and other equitable relief from any court of competent
jurisdiction to enforce any of the rights of the Company or its subsidiaries or
any of the covenants, agreements, duties or obligations of Officer hereunder, or
otherwise to prevent the violation of any of the terms or provisions hereof, all
without the necessity of proving the amount of any actual damage to the Company
or its subsidiaries thereof resulting therefrom; provided, however, that nothing
contained in this Section 11. shall be deemed or construed in any manner
whatsoever as a waiver by the Company or its subsidiaries of any of the rights
which any of them may have against Officer at law, in equity, by statute or
otherwise arising out of, in connection with or resulting from the breach by
Officer of any of his covenants, agreements, duties or obligations hereunder.
12. MISCELLANEOUS
12.1 ENTIRE AGREEMENT. This Amended Agreement contains the entire
understanding of the parties hereto relating to the subject matter hereof and
cannot be changed or terminated except in writing signed by both Officer and the
Company.
12.2 LIMITED LIABILITIES. All liabilities incurred by Officer in his
capacity as an officer hereunder shall be incurred for the account of the
Company, and Officer shall not be personally liable therefor. Officer shall not
be liable to the Company, or any of its respective subsidiaries, affiliates,
employees, officers, directors, agents, representatives, successors, assigns,
stockholders, and their respective subsidiaries and affiliates, the Company
shall, and hereby agrees to, indemnify, defend and hold Officer harmless from
and against any and all damages and/or loss or liability (including, without
limitation, all costs of defense thereof), for any acts or omissions in the
performance of service under and within the scope of this Amended Agreement on
the part of Officer.
12.3 NOTICES. All notices, requests and other communications (collectively,
"Notices") given pursuant to this Amended Agreement shall be in writing, and
shall be delivered by facsimile transmission with a copy delivered by personal
service or by United States first class, registered or certified mail (return
receipt requested), postage prepaid, addressed to the party at the address set
forth below:
If the Company: Veterinary Centers of America, Inc.
3420 Ocean Park Blvd. Ste. 1000
Santa Monica, CA 90405
Attention: Board of Directors
Facsimile No.: (310) 392-7464
If to Officer: _______________________
_______________________
_______________________
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Any Notice shall be deemed duly given when received by the addressee thereof,
PROVIDED THAT any Notice sent by registered or certified mail shall be deemed to
have been duly given three days from date of deposit in the United States mails,
unless sooner received. Either party may from time to time change its address
for further Notices hereunder by giving notice to the other party in the manner
prescribed in this Section 12.3.
12.4 GOVERNING LAW. This Amended Agreement has been made and entered into
in the state of California and shall be construed in accordance with the laws of
the State of California without regard to the conflict of laws principles
thereof.
12.5 COUNTERPARTS. This Amended Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
12.6 SEVERABLE PROVISIONS. The provisions of this Amended Agreement are
severable, and if any one or more provisions are determined to be judicially
unenforceable, in whole or in part, the remaining provisions shall nevertheless
be binding and enforceable.
12.7 SUCCESSORS AND ASSIGNS. This Amended Agreement and all obligations and
benefits of Officer and the Company hereunder shall bind and inure to the
benefit of Officer and the Company, their respective affiliates, and their
respective successors and assigns.
12.8 AMENDMENTS AND WAIVERS. No amendment or waiver of any term or
provision of this Amended Agreement shall be effective unless made in writing.
Any written amendment or waiver shall be effective only in the instance given
and then only with respect to the specific term or provision (or portion
thereof) of this Amended Agreement to which it expressly relates, and shall not
be deemed or construed to constitute a waiver of any other term or provision (or
portion thereof) waived in any other instance.
12.9 TITLE AND HEADINGS. The titles and headings contained in this Amended
Agreement are included for convenience only and form no part of the agreement
between the parties.
12.10 SURVIVAL. Notwithstanding anything to the contrary contained herein,
the provisions of Sections 6., 7., 8., 9., 10. and 11. shall survive the
termination of this Amended Agreement.
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IN WITNESS WHEREOF, this Amended Agreement has been executed as of the date
first set forth above.
VETERINARY CENTERS OF AMERICA, INC.
"THE COMPANY"
By: /S/
----------------------------------
Its:
-----------------------------
ACCEPTED AND AGREED TO:
/S/ ARTHUR J. ANTIN
- ----------------------
ARTHUR J. ANTIN
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (the "Amended Agreement")
is made and entered into as of the 1st day of February 1997, by and between
Veterinary Centers of America, Inc., a Delaware corporation (the "Company") and
Neil Tauber, an individual ("Officer").
R E C I T A L S
A. Officer is currently employed as Senior Vice President of the Company
pursuant to an Employment Agreement (the "Employment Agreement") between the
Company and Officer dated as of January 1, 1994.
B. The Company and Officer desire to amend and restate the Employment
Agreement regarding the terms and conditions of Officer's employment by the
Company.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing recitals and the terms,
covenants and conditions contained herein, the Company and Officer agree as
follows:
1. EMPLOYMENT.
Company hereby employs Officer, and Officer hereby accepts such employment,
as Senior Vice President of the Company, on the terms and subject to the
conditions set forth herein.
2. CAPACITY AND DUTIES.
2.1 Officer shall serve the Company as its Senior Vice President and shall
report directly to the Chief Executive Officer of the Company.
2.2 Subject to the direction and control of the Chief Executive Officer,
Officer shall perform such duties and responsibilities as are currently
prescribed by the Bylaws of the Company and which are customarily vested in the
office of senior vice president of a corporation.
2.3 Officer shall devote his business time, energy and efforts faithfully
and diligently to promote the Company's interests.
2.4 The terms of this Section 2. shall not prevent Officer from investing
or otherwise managing his assets in such form or manner as he chooses and
spending such time, whether or not during business hours, as he deems necessary
to manage his investments, so long as he is able to fulfill his duties pursuant
to Section 2. above.
2.5 Except for routine travel incident to the business of the Company,
Officer shall perform his duties and obligations under this Amended Agreement
principally from an office provided by the Company in Los Angeles, California or
the surrounding area.
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3. TERM.
This Amended Agreement shall be effective as of February 1, 1997 (the
"Effective Date") and shall govern Officer's employment from and after such
date. Officer's employment shall terminate on January 31, 2002 unless sooner
terminated in accordance with the provisions of this Amended Agreement or
extended by an amendment executed by the Company and the Officer (the "Term").
4. COMPENSATION.
4.1 BASE SALARY.
4.1.1 As compensation for services rendered under this Amended
Agreement, the Company shall pay to Officer a base salary (the "Base Salary")
computed in accordance with Section 4.1.2 below during the term of this Amended
Agreement, payable in accordance with the normal payroll procedures of the
Company.
4.1.2 During the term of this Amended Agreement, Officer's Base Salary
shall be $162,000 and shall be adjusted as provided in this Section. Commencing
on February 1, 1997 and on each anniversary thereafter, or from time to time at
the sole discretion of the Compensation Committee of the Board of Directors (the
"Compensation Committee"), Officer's Base Salary shall be reviewed by the
Compensation Committee and may be increased, but may never be decreased, in the
sole discretion of the Compensation Committee. In determining whether to
increase Officer's Base Salary the Compensation Committee shall engage a
reputable compensation consulting firm to determine comparable compensation
packages provided to executives in similarly situated companies.
4.1.3 The Company may deduct from the Base Salary amounts sufficient
to cover applicable federal, state and/or local income tax withholdings and any
other amounts which the Company is required to withhold by applicable law.
4.2 CASH BONUS PLAN. The Compensation Committee shall adopt a cash bonus
plan designed to provide Officer an opportunity to earn annual cash bonuses
during each calendar year during his employment which, when added to Officer's
Base Salary, shall provide Officer a level of compensation comparable to
compensation generally prevailing for other senior vice presidents of publicly
traded companies which are comparable to the Company. The factors to be used to
select which companies are comparable to that of the Company shall include, but
not be limited to, industry group, revenues, operating income, growth rate,
number of employees and location. The annual performance goals to be met in
order to earn portions or all of the bonus provided under the plan shall be
determined through consultation between the Officer and the Compensation
Committee. If requested by the Compensation Committee or Officer, the Company
shall retain a reputable, nationally recognized compensation consultant to
assist the Compensation Committee in identifying comparable companies and to
make recommendations regarding the structure and amount of the cash bonus plan.
4.3 STOCK OPTIONS. Officer shall be granted options to purchase 360,000
shares of the Common Stock of the Company with an exercise price of $10.25 per
share (the closing sales price
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on the National Market System on January 31, 1997, the trading day immediately
prior to approval of this Agreement by the Compensation Committee of the Board
of Directors). The options shall vest in 60 equal monthly installments on the
first day of each month commencing on July 1, 1997. The options granted pursuant
to this Section 4.3 shall be in lieu of any other options granted to Officer
during the term of this Amended Agreement. All options to purchase the Company's
Common Stock granted to Officer whether pursuant to a Company Stock Option Plan
or otherwise and notwithstanding the provisions of any other agreement to the
contrary, may be exercised by Officer or by Officer's family by delivery of a
promissory note in the amount of the total exercise price of the option (the
"Exercise Price"). The promissory note shall bear interest at the then current
thirty year U.S. treasury bond rate, shall be nonrecourse except to the security
referred to in the following clause, shall be secured by the Common Stock of the
Company so purchased, and shall be payable in full (principal and interest) on
the fourth anniversary of the date of the purchase of the shares.
Notwithstanding the foregoing, Officer shall apply all proceeds from the sale of
the shares so purchased by delivery of a promissory note to the repayment of
principal and interest outstanding under the note until all principal and
interest is paid in full. The Company shall maintain an effective registration
statement covering the shares underlying the options granted to Officer whether
pursuant to a Company Stock Option Plan or otherwise.
4.4 BENEFITS.
4.4.1 VACATION. Officer shall be entitled to four weeks paid vacation
for each calendar year during Officer's employment; provided, however, that
vacation shall only be taken at such times as not to interfere with the
necessary performance of Officer's duties and obligations under this Amended
Agreement.
4.4.2 AUTOMOBILE. The Company shall provide Officer with the use of a
luxury automobile that is selected by Officer and approved by the Compensation
Committee, the cost (the "Automobile Cost") of which during the first year of
the Term shall not be less than the cost that the Company currently provides for
Officer's use of an automobile. Commencing February 1, 1998 and continuing
annually thereafter, the Automobile Cost may, at Officer's sole discretion, be
increased 5% per annum. On the earlier of significant damage or destruction or
attaining three years of age, the Company shall replace such automobile with a
new automobile selected by Officer and approved by the Compensation Committee.
The Company shall pay all costs of insurance, repair, maintenance and operation
of such automobile. At the end of the three year period referred to herein,
Officer may, but is not obligated to, purchase the automobile for the book value
of the automobile on the Company's financial records.
4.4.3 CLUB MEMBERSHIPS. The Company shall pay monthly dues for
Officer's membership in clubs selected by Officer, provided the aggregate of
such monthly dues do not exceed $200.00 per month during the first year of the
Term. Commencing February 1, 1998 and continuing annually thereafter, such
monthly dues may, at Officer's sole discretion, increase 5% per annum.
4.4.4 OTHER BENEFITS; INSURANCE. During the term of Officer's
employment under this Amended Agreement, if and to the extent eligible, Officer
shall be entitled to participate in all operative employee benefit and welfare
plans of the Company then in effect ("Company Officer Benefit Plans"),
including, to the extent then in effect, group life, medical, disability and
other
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insurance plans, all on the same basis generally applicable to the
executives of the Company; PROVIDED, HOWEVER, that nothing contained in this
Section 4.4.4 shall, in any manner whatsoever, directly or indirectly, require
or otherwise prohibit the Company from amending, modifying, curtailing,
discontinuing or otherwise terminating, any Company Officer Benefit Plan at any
time (whether during or after the term hereof) except that the Company will at
all times during the term hereof and any severance period referred to in Section
8. hereof maintain medical insurance covering Officer and his dependents with
benefits at least as favorable as those provided by the Company as of the date
hereof. In addition to, and not in lieu of, any Company Officer Benefit Plan,
during the term of Officer's employment hereunder, the Company shall contribute
an amount equal to at least 20% of Officer's cash compensation to the payment of
premiums on a split dollar life insurance policy (the "Split Dollar
Contribution") for the benefit of Officer and his estate. Commencing on February
1, 1997 and on each anniversary thereafter, or from time to time at the sole
discretion of the Compensation Committee, the Split Dollar Contribution shall be
reviewed by the Compensation Committee and may be increased, but may never be
decreased, in the sole discretion of the Compensation Committee. In determining
whether to increase the Split Dollar Contribution the Compensation Committee
shall engage a reputable compensation consulting firm to determine comparable
provisions contained in compensation packages provided to executives in
similarly situated companies.
4.4.5 REIMBURSEMENT. Officer shall be entitled to reimbursement from
the Company for the reasonable costs and expenses incurred in connection with
the performance of the duties and obligations provided for in this Amended
Agreement. Additionally, Officer shall be entitled to reimbursement for
reasonable attorneys fees incurred in connection with the receipt of advice from
attorneys, accountants or financial planners regarding the exercise of stock
options to purchase common stock of the Company. Reimbursement shall be paid
upon prompt presentation of expense statements or vouchers and such other
supporting information as the Company may from time to time require.
5. INDEMNIFICATION.
The Company and Executive are parties to an Indemnification Agreement,
pursuant to which, INTER ALIA, the Company has agreed, on the terms and
conditions therein set forth, to indemnify Executive against certain claims
arising by reason of the fact that he is or was an officer or director of the
Company.
6. TRADE SECRETS.
Officer will not at any time during the term hereof and for the three year
period thereafter, in any fashion, form, or manner, unless specifically
consented to in writing by the Company, either directly or indirectly use or
divulge, disclose or communicate to any person, firm or corporation, any
confidential information of any kind, nature or description concerning any
matters affecting or relating to the business of the Company, except in the
ordinary course of the Company's business. All equipment, notebooks, documents,
memoranda, report, files, samples, books, correspondence, lists, other written
and graphic records, and the like, affecting or relating to the business of the
Company, which Officer shall prepare, use, construct, observe, possess or
control, shall be and remain the Company's sole property. Officer's obligation
under the preceding sentence shall
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continue in effect after the end of Officer's employment with the Company and
the obligations shall be binding on Officer's assigns, heirs, executors,
administrators, and other legal representatives.
7. RETURN OF CORPORATE PROPERTY AND TRADE SECRETS.
Upon termination of this Amended Agreement for any reason, Officer, or his
estate in the event of his death, shall turn over to the Company all
correspondence, property, writings or documents then in his possession or
custody belonging to or relating to the affairs of the Company or any of its
subsidiaries or affiliates or comprising or relating to the Trade Secrets.
8. TERMINATION OF EMPLOYMENT
8.1 TERMINATION IN CASE OF DEATH.
8.1.1 Officer's employment hereunder shall terminate immediately upon
the death of Officer.
8.1.2 Upon termination of this Officer's employment pursuant to this
Section 8.1, the Company shall pay to Officer's estate, on the Termination Date,
a lump sum payment of an amount equal to (x) all accrued and unpaid salary and
other compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date. In addition to the foregoing, and notwithstanding the
provisions of any other agreement to the contrary, (x) all options to purchase
the Common Stock of the Company which have been granted to Officer and which
would have vested during the 24 months following the date of termination shall
become immediately exercisable on the Termination Date and, notwithstanding any
other agreement to the contrary, shall remain exercisable for the full term of
each such option, and (y) the Company shall continue to provide for the benefit
of Officer's family the medical benefits referred to in Section 4.4.4 hereof for
60 months following the Termination Date.
8.2 TERMINATION IN CASE OF DISABILITY.
8.2.1 If Officer suffers a physical or mental disability which results
in Officer being unable to perform his duties hereunder for a 26 consecutive
week period, then the Board of Directors shall select a qualified physician to
examine Officer and review his physical and mental capacity. If such physician
determines in good faith that such physical or mental disability renders Officer
incapable of performing his duties hereunder for a period of at least 26
consecutive weeks following the date of such physician's written opinion, then
Officer's employment shall terminate effective 26 weeks following the date of
such physician's written opinion.
8.2.2 Upon termination of Officer's employment pursuant to this
Section 8.2, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date;
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provided however, such amount shall be reduced by the amount of any payments to
be paid to Officer under any long-term disability insurance policy maintained by
the Company for the benefit of Officer pursuant to Section 4.4.4. In addition to
the foregoing, and notwithstanding the provisions of any other agreement to the
contrary, (x) all options to purchase the Common Stock of the Company which have
been granted to Officer and which would have vested during the 24 months
following the date of termination shall become immediately exercisable on the
Termination Date and, notwithstanding any other agreement to the contrary, shall
remain exercisable for the full term of each such option, and (y) the Company
shall continue to provide to Officer all other benefits referred to in Sections
4.4.2, 4.4.3 and 4.4.4 hereof for 60 months following the Termination Date.
8.3 TERMINATION BY OFFICER FOR CAUSE.
8.3.1 The employment of Officer hereunder shall terminate immediately
upon written notice delivered by Officer to the Company upon the occurrence of
any of the following events:
8.3.1.1 The willful breach of any of the material obligations of
the Company to Officer under this Amended Agreement.
8.3.1.2 The Company's chief executive offices are moved to a
location outside of Los Angeles County, California; or
8.3.1.3 Officer fails to be reelected to, or is removed from, the
Board of Directors of the Company.
8.3.2 Upon termination of Officer's employment pursuant to this
Section 8.3, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date, plus an amount equal to five times (i) in the event no
previous bonus has been paid or is payable pursuant to this Amended Agreement,
20% of Officer's Base Salary, or (ii) in the event at least one bonus has been
paid or is payable to Officer, the average bonus based on all bonuses paid or
payable to Officer pursuant to this Amended Agreement. In addition to the
foregoing, and notwithstanding the provisions of any other agreement to the
contrary, (x) all options to purchase the Common Stock of the Company which have
been granted to Officer and which would have vested during the 36 months
following the date of termination shall become immediately exercisable on the
Termination Date and, notwithstanding any other agreement to the contrary, shall
remain exercisable for the full term of each such option, and (y) the Company
shall continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the 60
months following the Termination Date.
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8.4 TERMINATION BY OFFICER WITHOUT CAUSE.
8.4.1 This Amended Agreement shall terminate immediately upon delivery
to the Company of written notice of termination by Officer without cause.
8.4.2 Upon termination of this Amended Agreement pursuant to this
Section 8.4, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date.
8.5 TERMINATION BY THE COMPANY WITHOUT CAUSE
8.5.1 The employment of Officer shall terminate immediately upon
delivery to Officer of written notice of termination by the Company, which shall
be deemed to be "without cause" unless termination is expressly stated to be
pursuant to Sections 8.1 or 8.2.
8.5.2 Upon termination of this Officer's employment pursuant to this
Section 8.5, the Company shall pay to Officer, on the Termination Date, a lump
sum payment of an amount equal to (x) all accrued and unpaid salary and other
compensation payable to Officer by the Company and all accrued and unused
vacation and sick pay payable to Officer by the Company with respect to services
rendered by Officer to the Company through the Termination Date, and (y) the
amount Officer would have earned as Base Salary during the five years following
the Termination Date, plus an amount equal to five times (i) in the event no
previous bonus has been paid or is payable pursuant to this Amended Agreement,
20% of Officer's Base Salary, or (ii) in the event at least one bonus has been
paid or is payable to Officer, the average bonus based on all bonuses paid or
payable to Officer pursuant to this Amended Agreement. In addition to the
foregoing, and notwithstanding the provisions of any other agreement to the
contrary, (x) all options to purchase the Common Stock of the Company which have
been granted to Officer and which would have vested during the 24 months
following the date of termination shall become immediately exercisable on the
Termination Date and, notwithstanding any other agreement to the contrary, shall
remain exercisable for the full term of each such option, and (y) the Company
shall continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the 60
months following the Termination Date.
8.6 TERMINATION UPON THE EXPIRATION OF THE TERM. Upon termination of this
Amended Agreement upon the scheduled expiration of the term pursuant to Section
3. above, the Company shall pay to Officer, on the Termination Date, a lump sum
payment equal to (x) all accrued and unpaid salary and other compensation
payable to Officer by the Company and all accrued and unused vacation and sick
pay payable to Officer by the Company with respect to services rendered by
Officer to the Company through the Termination Date, and (y) the amount Officer
would have earned as Base Salary for the five years following the Termination
Date. In addition to the foregoing, and notwithstanding the provisions of any
other agreement to the contrary, (x) all options to purchase the Common Stock of
the Company which have been granted to Officer and which would have vested
during the 24 months following the date of termination shall become immediately
exercisable on the Termination Date and, notwithstanding any other agreement to
the contrary, shall remain exercisable for the full term of each such option,
and (y) the Company shall
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continue to provide to Officer all other benefits that would otherwise be
payable to Officer pursuant to Sections 4.4.2, 4.4.3 and 4.4.4 hereof for the
twelve months following the Termination Date.
8.7 TERMINATION DATE. For purposes of this Section 8., the term,
"Termination Date", shall mean that date on which Officer's employment is
terminated pursuant to this Section 8.
9. SEVERANCE PAYMENTS UPON CHANGE IN CONTROL.
9.1 SEVERANCE PAYMENT. Upon the occurrence of a Change in Control (as
defined in Section 9.5 below) of the Company, the employment of Officer
hereunder shall terminate and the Company shall pay to Officer in cash, on the
fifth day following the date on which the Change of Control occurs (which for
the purposes of this Section 9. shall be the Termination Date), the following:
9.1.1 All accrued and unpaid salary and other compensation payable to
Officer by the Company for services rendered by Officer to the Company through
the Termination Date;
9.1.2 All accrued and unused vacation and sick pay payable to Officer
by the Company with respect to services rendered by Officer to the Company
through the Termination Date; and
9.1.3 Severance pay in an amount equal to (x) the Base Salary Officer
would have earned during the five years following the Termination Date, and (y)
an amount equal to (i) in the event no previous bonus has been paid or is
payable pursuant to this Amended Agreement, 20% of Officer's Base Salary, or
(ii) in the event at least one bonus has been paid or is payable to Officer, the
average bonus based on all bonuses paid or payable to Officer pursuant to this
Amended Agreement.
9.2 CONTINUATION OF BENEFITS. The Company shall continue for a period of 60
months following the Termination Date, or such longer period of time existing
between the Termination Date and the scheduled expiration of this Amended
Agreement pursuant to Section 3. above, to provide Officer with all benefits
that would have been payable to him pursuant to Sections 4.4.2, 4.4.3 and 4.4.4
hereof if Officer had been employed by the Company during such period.
9.3 VESTING OF OPTIONS. In addition to the foregoing, and notwithstanding
the provisions of any other agreement to the contrary, upon the occurrence of a
Change in Control, all options to purchase Common Stock of the Company which
have been granted to Officer by the Company shall become immediately exercisable
on the Termination Date and, notwithstanding any other agreement to the
contrary, shall remain exercisable for the full term of each such option.
9.4 PROVISION OF SERVICES FOLLOWING CHANGE IN CONTROL. At the request of
the Company, Officer shall continue to serve hereunder for a period of up to 180
days following the Termination Date. If the Company requests Officer to perform
such services, Officer shall be compensated from and after the Termination Date
for the period that Officer actually remains employed by the Company at his then
current Base Salary. Any such amounts payable to Officer shall be in addition to
and not in lieu of the amounts payable to Officer under Section 9.1 above. Upon
the later to
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occur of an occurrence of a Change of Control or the termination of any period
during which Officer continues to provide services as aforesaid, Officer's
employment hereunder shall terminate.
9.5 CHANGE IN CONTROL. For purposes of this Section 9., "Change in Control"
of the Company shall be deemed to have occurred if (a) there shall be
consummated (x) any consolidation or merger of the Company into or with another
Person as such term is used in Sections 13(d)(3) and 14(d)(2) of the Securities
and Exchange Act of 1934, as amended (the "Exchange Act"), in which the Company
is not the continuing or surviving corporation or pursuant to which shares of
the Company's common stock would be converted into cash, securities or other
property, other than a merger of the Company in which the holders of the
Company's common stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving corporation immediately
after the merger, or (y) any sale, lease or other transfer (in one transaction
or a series of related transactions) of all or a significant portion of the
assets of the Company (for purposes of this definition, the sale of the stock or
assets of two or more of the Company's existing subsidiaries shall be deemed to
be a sale of a significant portion of the Company's assets), or (b) the
shareholders of the Company approve any plan or proposal for the liquidation or
dissolution of the Company, or (c) any Person who is not now the owner of 10% or
more of the Company's outstanding equity securities shall become the beneficial
owner (within the meaning of Rule 13d-3 under the Exchange Act) of 20% or more
of the Company's outstanding equity securities, or (d) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the entire board of directors shall cease for any reason to constitute a
majority thereof unless the election, or the nomination for election by the
Company's shareholders, of each new director was approved by a vote of at least
two-thirds of the directors then still in office who were directors in the
beginning of the period.
The parties believe that the payments pursuant to Sections 8 and 9 hereof
do not constitute "Excess Parachute Payments" under Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"). Notwithstanding such belief, if
any benefit under these sections constitutes an "Excess Parachute Payment" the
Company shall pay to Officer an additional amount ("Tax Payment") such that (x)
the excess of all Excess Parachute Payments (including payments under this
sentence) over the sum of excise tax thereon under Section 4999 of the Code and
income tax thereon under Subtitle A of the Code and under applicable state law
is equal to (y) the excess of all Excess Parachute Payments (excluding payments
under this sentence) over income tax thereon under Subtitle A of the Code and
under applicable state law. Such Tax Payment shall be paid to Officer
concurrently with the severance payment referred to in Section 9.1 above.
10. NO MITIGATION.
The payments required to be paid to Officer by Company pursuant to Sections
8. and 9. shall not be reduced by or mitigated by amounts which Officer earns or
is capable of earning during any period following his Termination Date.
11. INJUNCTIVE RELIEF.
Officer hereby recognizes, acknowledges and agrees that in the event of any
breach by Officer of any of his covenants, agreements, duties or obligations
hereunder, the Company would suffer great and irreparable harm, injury and
damage, the Company would encounter extreme
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difficulty in attempting to prove the actual amount of damages suffered by the
Company as a result of such breach, and the Company would not be reasonably or
adequately compensated in damages in any action at law. Officer therefore agrees
that, in addition to any other remedy the Company may have at law, in equity, by
statute or otherwise, in the event of any breach by Officer of any of the
covenants, agreements, duties or obligations hereunder, the Company or its
subsidiaries shall be entitled to seek and receive temporary, preliminary and
permanent injunctive and other equitable relief from any court of competent
jurisdiction to enforce any of the rights of the Company or its subsidiaries or
any of the covenants, agreements, duties or obligations of Officer hereunder, or
otherwise to prevent the violation of any of the terms or provisions hereof, all
without the necessity of proving the amount of any actual damage to the Company
or its subsidiaries thereof resulting therefrom; provided, however, that nothing
contained in this Section 11. shall be deemed or construed in any manner
whatsoever as a waiver by the Company or its subsidiaries of any of the rights
which any of them may have against Officer at law, in equity, by statute or
otherwise arising out of, in connection with or resulting from the breach by
Officer of any of his covenants, agreements, duties or obligations hereunder.
12. MISCELLANEOUS
12.1 ENTIRE AGREEMENT. This Amended Agreement contains the entire
understanding of the parties hereto relating to the subject matter hereof and
cannot be changed or terminated except in writing signed by both Officer and the
Company.
12.2 LIMITED LIABILITIES. All liabilities incurred by Officer in his
capacity as an officer hereunder shall be incurred for the account of the
Company, and Officer shall not be personally liable therefor. Officer shall not
be liable to the Company, or any of its respective subsidiaries, affiliates,
employees, officers, directors, agents, representatives, successors, assigns,
stockholders, and their respective subsidiaries and affiliates, the Company
shall, and hereby agrees to, indemnify, defend and hold Officer harmless from
and against any and all damages and/or loss or liability (including, without
limitation, all costs of defense thereof), for any acts or omissions in the
performance of service under and within the scope of this Amended Agreement on
the part of Officer.
12.3 NOTICES. All notices, requests and other communications (collectively,
"Notices") given pursuant to this Amended Agreement shall be in writing, and
shall be delivered by facsimile transmission with a copy delivered by personal
service or by United States first class, registered or certified mail (return
receipt requested), postage prepaid, addressed to the party at the address set
forth below:
If the Company: Veterinary Centers of America, Inc.
3420 Ocean Park Blvd. Ste. 1000
Santa Monica, CA 90405
Attention: Board of Directors
Facsimile No.: (310) 392-7464
If to Officer: ___________________
___________________
___________________
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Any Notice shall be deemed duly given when received by the addressee thereof,
PROVIDED THAT any Notice sent by registered or certified mail shall be deemed to
have been duly given three days from date of deposit in the United States mails,
unless sooner received. Either party may from time to time change its address
for further Notices hereunder by giving notice to the other party in the manner
prescribed in this Section 12.3.
12.4 GOVERNING LAW. This Amended Agreement has been made and entered into
in the state of California and shall be construed in accordance with the laws of
the State of California without regard to the conflict of laws principles
thereof.
12.5 COUNTERPARTS. This Amended Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
12.6 SEVERABLE PROVISIONS. The provisions of this Amended Agreement are
severable, and if any one or more provisions are determined to be judicially
unenforceable, in whole or in part, the remaining provisions shall nevertheless
be binding and enforceable.
12.7 SUCCESSORS AND ASSIGNS. This Amended Agreement and all obligations and
benefits of Officer and the Company hereunder shall bind and inure to the
benefit of Officer and the Company, their respective affiliates, and their
respective successors and assigns.
12.8 AMENDMENTS AND WAIVERS. No amendment or waiver of any term or
provision of this Amended Agreement shall be effective unless made in writing.
Any written amendment or waiver shall be effective only in the instance given
and then only with respect to the specific term or provision (or portion
thereof) of this Amended Agreement to which it expressly relates, and shall not
be deemed or construed to constitute a waiver of any other term or provision (or
portion thereof) waived in any other instance.
12.9 TITLE AND HEADINGS. The titles and headings contained in this Amended
Agreement are included for convenience only and form no part of the agreement
between the parties.
12.10 SURVIVAL. Notwithstanding anything to the contrary contained herein,
the provisions of Sections 6., 7., 8., 9., 10. and 11. shall survive the
termination of this Amended Agreement.
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IN WITNESS WHEREOF, this Amended Agreement has been executed as of the
date first set forth above.
VETERINARY CENTERS OF AMERICA, INC.
"THE COMPANY"
By: /S/
---------------------------------
Its:
-----------------------------
ACCEPTED AND AGREED TO:
/S/ NEIL TAUBER
- ------------------------------
NEIL TAUBER
<TABLE>
<CAPTION>
LIST OF SUBSIDIARIES
STATE OF
INCORPORATION OR
NAME OF SUBSIDIARY ORGANIZATION DOING BUSINESS AS
- ------------------ ----------------- -----------------
<S> <C> <C>
West Los Angeles Veterinary Medical Group, Inc. California
VCA Clinical Veterinary Labs, Inc. California
Lakewood Animal Hospital, Inc. California VCA Lakewood Animal Hospital
Robertson Blvd. Animal Hospital, Inc. California VCA Robertson Blvd. Animal
Hospital
VCA Bay Area Animal Hospital, Inc. California
Northern Animal Hospital Inc. Arizona VCA Northern Animal Hospital
VCA of San Jose, Inc. California VCA Crocker Animal Hospital
VCA Real Property Acquisition Corporation California
VCA of Colorado - Anderson, Inc. California VCA Anderson Animal Hospital
Anderson Animal Hospital, Inc. Colorado
VCA - Animal Hospital West, Inc. California
Westwood Dog and Cat Hospital, Inc. California VCA Animal Hospital West
VCA of Teresita, Inc. California VCA Teresita Animal Hospital
VCA of Asher, Inc. California VCA Asher Animal Hospital
Asher Veterinary Clinic - a general partnership California
Wingate, Inc. Colorado VCA Wingate Animal Hospital
VCA - Mission, Inc. California VCA Mission Animal Hospital
VCA Albuquerque, Inc. California VCA Veterinary Care Animal
Hospital
VCA Wyoming Animal Hospital, Inc. California
<PAGE>
Animal Emergency Clinic, P.C. Illinois Berwyn Animal Emergency Clinic,
Inc., Animal Health Care and
Emergency Clinic, P.C. and
Animal Health Care, P.C.
VCA Specialty Pet Products, Inc. California
VCA Rossmoor, Inc. California
Rossmoor - El Dorado Animal Hospital, Inc. California VCA-Rossmoor El Dorado Animal
Hospital
VCA Albany Animal Hospital, Inc. California VCA Albany Animal Hospital
Albany Veterinary Clinic, Inc. California
VCA Howell Branch Animal Hospital Inc. California
Howell Branch Animal Hospital, P.A. Florida
VCA Cacoosing Animal Hospital, Inc. California
Cacoosing Animal Hospital, Ltd. Pennsylvania
Cacoosing Pet Care & Nutrition Center, Inc. Pennsylvania
Vet Research Laboratories, LLC Delaware
VCA Anderson of California Animal Hospital, Inc. California
South County Animal Hospital, LLC California
VCA Clinipath Labs, Inc. California
VCA Eagle River Animal Hospital, Inc. California
Eagle River Animal Hospital, Inc. California
VCA Miller Animal Hospital, Inc. California
Miller Animal Hospital, Inc. California
VCA Marina Animal Hospital, Inc. California
Veterinary Hospitals, Inc. California Marina Veterinary Clinic
VCA All Pets Animal Complex, Inc. California
VCA Castle Shannon Animal Hospital, Inc. California
VCA APAC Animal Hospital, Inc. California
VCA Northwest Veterinary Diagnostics, Inc. California
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<PAGE>
VCA Information Systems, Inc. California
VCA East Anchorage Animal Hospital, Inc. California
Fox Chapel Animal Hospital, Inc. Pennsylvania
MS Animal Hospitals, Inc. California
VCA Professional Animal Laboratory, Inc. California Antech Diagnostics
VCA Detwiler Animal Hospital, Inc. California
Detwiler Veterinary Clinic, Inc. Pennsylvania
VCA Lakeside Animal Hospital, Inc. California
VCA Cenvet, Inc. California
VCA Golden Cove Animal Hospital, Inc. California
Berla, Inc. California VCA Golden Cove Animal Hospital
Avian Clinic, Etc. Animal Clinic of Golden Cove
Tampa Animal Medical Center, Inc. Florida VCA Tampa Animal Hospital
VCA Silver Spur Animal Hospital, Inc. California
Silver Spur Animal Hospital, Inc. California
VCA Lewis Animal Hospital, Inc. California
Lewelling Veterinary Clinic, Inc. California
VCA South Shore Animal Hospital, Inc. California
VCA Alpine Animal Hospital, Inc. California
VCA Greater Savannah Animal Hospital, Inc. California
VCA Kaneohe Animal Hospital, Inc. California
VCA Lammers Animal Hospital, Inc. California
Lammers Veterinary Hospital, Inc. California
VCA Referral Associates Animal Hospital, Inc. California
VCA Clarmar Animal Hospital, Inc. California
Clarmar Animal Hospital, Inc. California
VCA St. Petersburg Animal Hospital, Inc. California
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<PAGE>
St. Petersburg Animal Hospital, LLC California
VCA Northboro Animal Hospital, Inc. California
VCA Animal Hospitals, Inc. California VCA Parkwood Animal Hospital
Agoura Meadows Veterinary Clinic
VCA Santa Anita Animal Hospital
VCA Bering Sea Animal Hospital
VCA Rock Creek Animal Hospital
VCA Rohrig Animal Hospital
Pets' Rx, Inc. Delaware
Pets' Rx Nevada, Inc. Nevada
William C. Fouts, Ltd. Nevada Decatur Animal Clinic
H.B. Animal Clinics, Inc. California Blossom Veterinary Clinic
Princeton Animal Hospital California Almaden Valley Veterinary
Hospital
Spring Mountain Animal Hospital, L.L.C. Nevada
Old Town Veterinary Hospital, Inc. Virginia
VCA North Rockville Animal Hospital, Inc. California
North Rockville Veterinary Hospital, Inc. Maryland
VCA Lamb & Steward Animal Hospital, Inc.
VCA Squire Animal Hospital, Inc. California
VCA Texas Management, Inc. California
VCA Centers - Texas, Inc. Texas
Veterinary Centers of America - Texas, L.P. Texas
VCA Animal Hospital - Texas, L.P. Texas
VCA Coast Animal Hospital, LLC California
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<PAGE>
Golden Merger Corporation Delaware La Grange Park Animal Hospital
Eagle Park Animal Clinic, Inc. Indiana
Newark Animal Hospital, Inc. Delaware
Academy Animal, Inc. Maryland
Edgebrook, Inc. New Jersey
Riviera Animal Hospital, Inc. Florida
PPI of Pennsylvania, Inc. Delaware
Noyes Animal Hospital, Inc. Illinois
Professional Veterinary Services, Inc. Indiana Village Park Animal Center
Cross Point Animal Hospital
Indiana Spay - Neuter Health
Clinic
Greenwood Spay Neuter Animal
Hospital
The Pet Practice (Florida), Inc. Delaware
The Pet Practice (Illinois), Inc. Delaware
The Pet Practice of Michigan, Inc. Delaware
The Pet Practice (Massachusetts), Inc. Delaware
The Pet Practice (Massachusetts), Inc. Massachusetts
</TABLE>
