CORPORATE GOVERNANCE GUIDELINES AND PRACTICES
(as adopted on September 19, 2007)

The primary responsibilities of the board of directors of Velcera, Inc. (the "Company") are to oversee the exercise of corporate powers and to ensure that the Company's business and affairs are managed to meet stated goals and objectives. The board recognizes its responsibility to engage, and provide for the continuity of, executive management that possesses the character, skills and experience required to attain the Company's goals.

In fulfilling their roles as directors, the board of directors will be guided by the following principles and objectives:

• Represent the collective interests of all stockholders of the Company;
  
• Discharge duties in good faith, with due care and in a manner he or she reasonably believes to be in the best interests of the Company;
  
• Possess independence, objectivity and the highest degree of integrity on an individual and collective basis;
  
• Be dedicated to understanding the business of the Company and issues presented to the board;
  
• Be committed to active, objective, thoughtful, constructive and independent participation at board meetings and committee meetings;
  
• Bring to the board meetings their collective breadth of business, professional and personal experience to represent the interests of stockholders;
  
• Review fundamental operating, financial and other corporate plans, strategies and objectives;
  
• Evaluate on a regular and timely basis the qualitative and quantitative performance of the Company and its senior management;
  
• Review the process of providing appropriate financial and operating information, internally and externally;
  
• Assure adherence to proper policies of corporate conduct, including compliance with applicable laws, regulations, business and ethical standards;
  
• Assure maintenance of proper accounting, financial and other appropriate controls;
  
• Oversee the Company's capital structure and financial policies and practices;
  
• Assess major risks facing the Company and review options for their mitigation; and
  
• Evaluate and take steps to improve the overall effectiveness of the board.

The board has the responsibility to organize its functions and conduct its business in the manner it deems most effective and efficient, consistent with its duties of good faith, due care and loyalty. In that regard, the board has adopted a set of flexible policies and practices to guide its governance practices in the future. These guidelines, set forth below, will be regularly re-evaluated by the board in light of changing circumstances in order to continue serving the best interests of the Company's stockholders. Accordingly, this summary of current practices is not a fixed policy or resolution of the board, but merely a statement of current practices that is subject to continuing assessment and change.

A.     Board Composition.

   1.    Size of the Board. The board of directors currently has seven members. The size of the board is subject to change depending on circumstances existing from time to time. Accordingly, the board will periodically review the appropriateness of the size of the board.

   2.    Role of Chair. Generally, the chair's role shall be to lead the board and to provide a bridge between the outside directors and the executive management of the Company, including the CEO. In particular, the chair shall (i) preside over all meetings of the board, (ii) be available to discuss with any independent director his or her concerns about the Company and its performance, and relay those concerns, where appropriate, to the full board, (iii) be available to consult and discuss with the CEO regarding the concerns of the directors, (iv) be available to discuss with the CEO or other senior executives of the Company any concerns such executive might have, and (v) maintain close contact with the chair of each standing committee of the board.

   3.    Majority of Independent Directors. It is the policy of the board that a majority of the directors will not be current employees of the Company and will otherwise meet appropriate standards of independence. No relationship between any independent director and the Company should be of a nature that could interfere with the exercise of independent judgment in carrying out the responsibilities of a director.

A director will not be deemed independent if: (i) the director is or was employed by the Company or any parent or subsidiary of the Company within the previous three years; (ii) a family member of the director is or was employed by the Company or any parent or subsidiary of the Company as an executive officer within the previous three years; (iii) the director or any of his or her family members accepted payment (including political contributions and payments consisting of consulting or personal service contracts) of more than $60,000 during the current fiscal year or any of the past three fiscal years (other than (a) payments for service as a member of the board or a committee of the board, (b) payments arising solely from investments in the Company's securities, (c) compensation paid to a family member who is a non-executive employee of the Company or any parent or subsidiary of the Company, (d) benefits under a tax-qualified retirement plan, or non-discretionary compensation, or (e) loans permitted by Section 13(k) of the Securities Exchange Act of 1934; (iv) the director or a family member of the director is a partner in, or an executive officer or controlling stockholder of, any for-profit or not-for-profit organization to which the Company made or from which the Company received, payments in the current fiscal year or any of the past three fiscal years that exceed 5% of the recipient's consolidated gross revenues for that year or $200,000, whichever is more (other than (a) payments arising solely from investments in the Company's securities or (b) payments under non-discretionary charitable contribution matching programs); (v) the director or a family member of the director is or was employed as an executive officer of another entity that has or had within the past three years as a member of its compensation committee of the board of directors any of the Company's executive officers; or (vi) the director or a family member of the director is a partner of the Company's independent auditors, or was a partner or employee of the Company's independent auditors and worked on the Company's audit during any of the past three years. For the purpose of these corporate governance guidelines, "family member" means a person's spouse, parents, children and siblings, whether by blood, marriage or adoption, or anyone residing in such person's home.

The determination of what constitutes independence for an independent director in any individual situation shall be made by the board in light of the totality of the facts and circumstances relating to such situation and in compliance with the applicable legal requirements.

   4.    Selection of Board Nominees. The board is responsible for selecting its members, subject to stockholder approval on an annual basis. The board considers nominees recommended by directors, officers, employees, stockholders and others using the same criteria to evaluate all candidates. The board reviews each candidate's qualifications, including whether a candidate possesses any of the specific qualities and skills desirable in certain members of the board. Evaluations of candidates generally involve a review of background materials, internal discussions and interviews with selected candidates, as appropriate.

   5.    New Director Orientation; Continuing Education. Orientation materials will be made available and appropriate meetings will be held to acquaint new directors with the business, history, current circumstances, key issues and top managers of the Company. Directors are encouraged to also participate in continuing education programs in order to maintain the necessary level of expertise to perform his or her responsibilities. The Company's secretary shall work with the board chair as necessary to periodically provide materials that would assist directors with their continuing education.

   6.    Directors Who Change Job Responsibility. The board does not believe directors who retire or change their principal occupation or business association or who experience another material change in the circumstances surrounding his or her employment or business associations or interests should necessarily leave the board. However, promptly following any such event, the director must notify the board chair, giving appropriate detail of the reasons for and other circumstances surrounding such change. The board shall then consider such change and review the continued appropriateness of board membership under the new circumstances.

   7.    Retirement; Term Limits. Although the board currently believes that neither a fixed retirement age nor term limits are necessary or appropriate, it shall periodically review those positions.

   8.    Other Board Memberships. Without specific approval from the board, no director may serve on more than 4 public company boards (not including the Company's board). Without specific approval from the board, the Company's executive officers should not serve on any public company boards (other than the Company's).

   9.    Separation of the Offices of Chairman and Chief Executive Officer. The board does not have a policy on whether the offices of chairman of the board and CEO should be separate and, if they are to be separate, whether the chairman of the board should be selected among the independent directors or should be an employee of the Company.

B.    Board Meetings and Materials

   1.    Frequency of Board Meetings; Attendance . Currently, the board has four regularly-scheduled, in-person meetings each year, with additional telephonic meetings as required from time to time. At least one regular meeting per year will be scheduled as an all-day meeting. The board considers its current meeting schedule to be adequate, but the number of regularly-scheduled meetings may be adjusted as necessary to meet changing conditions and needs. A calendar of board meetings will be developed and circulated as far in advance as practicable. Members are expected to attend all meetings barring special circumstances.

   2.    Agenda; Distribution of Meeting Materials . The chair, with assistance and input from the CEO, develops the agenda for board meetings. The agenda is circulated in advance and board members may suggest additional items for consideration. As much information and data as practical on the meeting agenda items and the Company's financial performance is sent to board members as far in advance of the meeting as is reasonable and practical. In addition, in months in which the board is not scheduled to hold a regular meeting, the Company's executive management will provide to the board reports or other materials concerning the Company's operations, finances and other appropriate matters as requested and deemed necessary by the board.

   3.    Independent Director Discussions . It is the policy of the board that the independent directors meet separately without management directors at least twice per year to discuss such matters as the independent directors deem appropriate. The Company's independent auditors and counsel may be invited by the board to attend all or a portion of these sessions.

   4.    Access to Senior Management . The board encourages the presentation at meetings by managers who can provide additional insight into matters being discussed or who have potential that the CEO believes should be given exposure to the board. Beyond board meetings, all board members will have access to senior management, provided such contact is minimally disruptive to the business operation of the Company.

C.    Board Committees

   5.    Standing Committees. The board currently has two standing committees: Audit Committee and Compensation Committee. From time to time the board may establish a new committee or disband a current committee if the circumstances so warrant. The board has adopted a charter for each standing committee of the board; each committee shall annually review their charter and recommend to the full board any changes it believes are appropriate.

   6.    Committee Member Selection. The board is responsible for reviewing and recommending the assignment of directors to various committees. The board will also recommend, subject to applicable membership requirements and as practical, an appropriate rotation process, to ensure diversity of board member experience and variety of exposure to the affairs of the Company. The members of the Audit and Compensation Committees will consist solely of independent directors and will have all such other qualifications as are required by applicable listing rules and laws. The board will make committee assignments on an annual basis at the first regular meeting of the board following the Company's annual meeting of stockholders.

   7.    Committee Functions. The number and content of committee meetings and other matters of committee governance will be determined by each committee in light of the authority delegated by the full board to such committee, the committee's charter and applicable regulations or principles. The Company shall provide to each committee access to employees, counsel and other resources to enable committee members to carry out there responsibilities. The full authority and responsibilities of each committee is fixed by resolution of the full board and/or the committee's charter, if any. Committee charters will be posted on the Investor Relations section of the Company's web site.

D.     Management Responsibilities

   8.    Management Succession Planning. The CEO will annually review succession planning with the full board as it relates to elected corporate officers, and make recommendations to the board with respect to individuals to occupy these positions in the event of those officers' termination of employment, disability or death. The entire board shall annually recommend and approve the succession plan relating to the CEO. The board, at all times, will have plans for the immediate replacement of the chair, CEO and CFO.

   9.    Financial Reporting, Legal Compliance and Ethical Conduct. The board's governance and oversight functions do not relieve the Company's executive management of the primary responsibility for preparing financial statements that accurately and fairly present the Company's financial results and condition. Executive management shall maintain systems, procedures and a corporate culture that promote compliance with legal and regulatory requirements and the ethical conduct of the Company's business.

   10.    Corporate Communications. The board believes the executive management has the primary responsibility to communicate with investors, the media, employees and other constituencies that are involved with the Company, and to set policies for those communications.