Exhibit 10.14
[LOGO OF OSCA]
LEASE
This lease is made and entered into by and between V.L. Cain, a resident of
Tarrant County, Texas (herein called "Owner"), and OSCA, Inc. a Delaware
corporation (herein called "Tenant").
For acknowledged consideration, Owner leases to Tenant and Tenant leases
from Owner the real property, including buildings and grounds, located at 301 S.
Sixth Avenue, with 5 acres, in the City of Mansfield, State of Texas, together
with all improvements and additions (herein called the "Premises"), and Owner
and Tenant agree as follows:
SECTION 1
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TERM OF LEASE
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1.1 The term ("Term") of this lease shall be for five (5) years beginning
on January 1, 1998, and expire on January 1, 2003.
SECTION 2
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RENT
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2.1 Tenant shall pay and Owner shall accept a monthly rental in the amount
of Five Thousand Two Hundred Dollars ($5200.00) per month. One such monthly
rental payment shall be due and payable on or before the first day of each
calendar month succeeding the commencement date recited above during the term of
this lease, except that the rental payment for any fractional calendar month at
the end of this lease shall be prorated. In addition to these rental payments,
Tenant shall pay when due, as additional rent, all other amounts to be paid by
Tenant under this lease.
2.2 It is the intention of the Owner and Tenant that the rent paid under
this lease shall be net to Owner and that each year during the Term of the lease
all costs, expenses and obligations of every kind relating to the Premises
(except as otherwise specifically provided in the lease) which may arise or
become due during the Term of this leases shall be paid by Tenant, and that
Owner shall be indemnified by Tenant against such costs, expenses and
obligations; provided, however, that such costs, expenses and obligations, in
the aggregate, the then remaining rental payments due hereunder.
2.3 All payments of rent shall be made by Tenant to Owner without notice
or demand, at such place within the United States as Owner may from time to time
designate in writing. Unless notified otherwise, Owner designates Owner's
address stated in Section 17 of this lease as the place for making the payments
of rent. All rents shall be payable in Legal Tender of the United States as the
same is then constituted.
SECTION 3
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UTILITIES
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Tenant shall pay all utilities used on the Premises during the term of this
lease.
SECTION 4
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TAXES
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Tenant shall be liable for and shall pay, prior to their becoming
delinquent, all the real property taxes, assessments and governmental levies on
the Premises; provided, however, that any real property
[LETTERHEAD OF OSCA]
taxes, assessments and levies which may be levied or assessed for a period
beginning before the commencement of this lease or ending after the termination
hereof shall be prorated between Tenant and Owner as of such date or dates.
Tenant shall also pay any license tax or other tax on the business activity of
Tenant and on property belonging to Tenant and situated on the Premises.
SECTION 5
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REPAIRS, MAINTENANCE AND IMPROVEMENTS
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5.1 Owner shall, at Owner's expense, maintain and keep in good repair the
roof, foundation and the structural soundness of the exterior walls of the
building, and the ceiling, all plumbing, all water and gas pipes, the electric
wiring, the heating plant and the air conditioning system, in each case,
reasonable wear and tear expected.
5.2 Tenant shall, at Tenant's expense, maintain and keep in good repair
all other interior aspects of the Premises including but not limited to the
light fixtures, interior walls and floors, and all doors, windows and glass,
reasonable wear and tear excepted.
5.3 Tenant shall, at Tenant's expense, keep the Premises clean, neat and
free of rubbish, and shall keep in repair and maintain the Premises in the same
condition as when received, ordinary wear and tear and damage by reason of
lighting or other natural cause or fire excepted.
5.4 Tenant may make reasonable alterations, additions and improvements to
the Premises including the erection of signs, at Tenant's expense, provided that
Owner shall have the right to approve same, such approval to be reasonably
granted so long as the alterations, additions and improvements do not diminish
the value of the Premises. All alterations, additions or improvements made by
either of the parties, except movable office furniture and movable business
fixtures, machines and equipment put in at the expense of Tenant, shall inure to
be benefit of Owner and shall belong to Owner absolutely as soon as made or
installed. Tenant may, if Tenant is not in default on any of the terms and
conditions of this lease, remove at the termination of the lease any movable
office furniture or movable business fixtures, machines or equipment purchases
or provided by Tenant that may be moved without damage to the building.
SECTION 6
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CASUALTY INSURANCE AND CASUALTY DAMAGE
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6.1 Owner shall secure and constantly maintain at Owner's expense
insurance against loss and damage by fire with an extended coverage endorsement
including lighting and windstorm, in the amount of the full replacement cost of
the building and other improvements erected on the Premises and naming Owner as
the insured.
6.2 If the Premises are rendered totally or substantially untenantable by
fire or other casualty, this lease, at the option of Owner or Tenant exercised
in writing within sixty (60) days of the date of the fire or casualty, shall
terminate; otherwise Owner shall restore the Premises following damage or
destruction as rapidly as sound business judgement permits and the rent shall
abate during the period of restoration.
6.3 Owner and Tenant, to the extent permitted by law and by their
respective insurance policies, hereby waive any rights each may have against
each other, on the account of any loss or damage occasioned to Owner or Tenant,
as the case may be, their respective property, the Premises or its contents
arising from any risk covered by valid and enforceable fire and extended
coverage insurance, to the extent of such coverage. Owner and Tenant each shall
cause an endorsement to be furnished to their respective insurance policies
recognizing their waiver of subrogation.
[LETTERHEAD OF OSCA]
SECTION 7
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WARRANTIES OF OWNER
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Owner warrants and covenants that the Owner is lawfully seized and
possessed of good fee simple title to the Premises, that Tenant, on paying the
rental herein provided and performing the other covenants and conditions herein
contained, shall have quiet and peaceful possession of the Premises during the
Term and that the Premises are suitable for the continuation of operations by
Tenant as currently contemplated. Tenant assumes responsibility for the safety
of the Premises and for the suitability of the Premises for Tenant's use.
SECTION 8
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SUBLEASE OR ASSIGNMENT
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Neither Tenant nor any court or officer thereof or receiver or trustee in
bankruptcy shall sublease, assign or transfer the Premises or any interest in
this lease without the consent in writing of Owner, which shall not be
unreasonably withheld. Notwithstanding the foregoing, Tenant may sublease,
assign or transfer its interest in this lease to an affiliate, subsidiary or
parent without consent of Owner. In addition, any assignment or transfer by
Tenant in connection with the sale of substantially all of its assets or a
merger, consolidation or reorganization of Tenant shall not require consent of
Owner. In the event of a sublease or assignment under this Section, Tenant shall
remain liable for an default of a subtenant or assignee.
SECTION 9
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USE OF PREMISES
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No part of the Premises or improvements thereon shall be used in any manner
whatsoever for a purpose in violation of the laws of the United States or the
State in which the Premises are located or any other applicable ordinance,
regulation or law. Tenant shall comply with all laws, ordinances, regulations or
orders enacted or passed during the term of this lease applicable to the
Premises.
SECTION 10
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CONDEMNATION
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If at any time a substantial part or all of the Premises is taken for
public or quasi-public use under any statute or by power of eminent domain or by
private purchase in lieu thereof by a body vested with the power of eminent
domain, this lease shall continue until the date of the taking, at which time
this lease shall terminate and rental due hereunder shall abate and Tenant shall
have no rights in any award or purchase price by reason of taking. In the event
a condemnation takes a portion of the Premises but the Premises continue to be
tenantable for Tenant's purposes, the rent shall be abated pro rate, Tenant
shall have no rights in any award or purchase price paid by reason of the
taking, and the lease shall continue otherwise in full force and effect.
SECTION 11
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MECHANICS' AND MATERIALMEN'S LIENS
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Tenant shall not do or suffer anything to be done whereby the Premises
shall be encumbered by a lien, and shall, whenever and as often as any lien is
filed against the Premises purporting to be for labor or material furnished or
to be furnished to the Tenant, discharge the same of the record within thirty
(30) days after the date of filing. Tenant may contest the validity of any lien
or claim if Tenant shall have posted a bond with adequate surety to insure that
immediately upon final determination of validity of the lien or claim Owner
shall be paid for any judgement rendered, with all proper costs and charges and
Tenant shall at such time have the lien released without cost to Owner. Notice
is hereby give that Owner shall not be liable or any labor or materials
furnished or to be furnished to the Tenant on credit, and that no mechanic's,
[LETTERHEAD OF OSCA]
materialmen's or other lien for any such labor or material shall attach to or
affect the reversionary or other estate or interest of Owner in and to the real
estate or other estate and improvements which are a part of the Premises.
SECTION 12
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ENTRY BY OWNER
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With reasonable notice from the Owner, Tenant shall permit Owner, or Owner's
agents or employees, at all reasonable business hours, to enter and examine the
Premises, or to make proper repairs or alterations, taking any space needed, but
attempting not to interrupt Tenant's operation of its business; and during the
three (3) months preceding the termination of this lease, Tenant will permit
customary "For Sale" or "For Rent" notices, or both, to be exhibited on the
Premises.
SECTION 13
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DEFAULT
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13.1 Should Tenant be in default in the payment of rent and remain in
default for a period of fifteen (15) days after receipt of written notice of
such default from Owner, such default shall, at Owner's option, constitute a
forfeiture of the lease.
13.2 Should Tenant violate any other term, condition or covenant of this
lease and not cease or otherwise cure or begin to cure the violation within
thirty (30) days after receiving written notice from Owner, or if Tenant should
abandon or vacate the Premises before the end of any term of this lease, or if
Tenant should be adjudicated a bankrupt or insolvent according to law, or should
make an assignment for the benefit of creditors, or if a receiver, trustee or
liquidator of Tenant's property shall be appointed and not discharged within
sixty (60) days, then the occurrence of such act or omission shall, at Owner's
option, constitute a forfeiture of the lease.
13.3 Should Tenant fail to perform any duty under this lease Owner may,
after giving ten (10) days notice in writing, perform Tenant's duty and the cost
of performance shall be added to the rental amount and shall become immediately
due and owing.
13.4 Upon any forfeiture, no demand shall be necessary before recovery of
possession of the Premises; and Owner may enter the Premises, or any part, and
take possession and expel Tenant or other occupants and their effects, without
being guilty of any trespass, and Tenant shall nevertheless be liable for all
future rentals and any rents in arrears and breaches of covenant. Acceptance of
rentals subsequent to any forfeiture shall not be considered a confirmation or
renewal of this lease. In addition, Owner reserves all other rights and remedies
provided at law or in equity.
13.5 The failure of Owner to declare a breach or forfeiture of this lease
for the violation of any term, condition or covenant shall not be construed as a
waiver of the rights to declare a breach or forfeiture of this lease upon the
occurrence of any subsequent act or omission, the right to declare a breach or
forfeiture being a continuing one in Owner.
SECTION 14
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OPTION TO RENEW
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While this lease is in full force and effect, provided that Tenant is not
in default of any of the terms, covenants and conditions hereof, Tenant shall
have the right or option to extend the original term of this lease for one
further term of five (5) years. Such extension or renewal of the original term
shall be on the same terms, covenants or conditions as provided for in the
original term except that the rental during the extended term shall be at fair
market rental then in effect on equivalent properties, of equivalent size, in
[LETTERHEAD OF OSCA]
equivalent areas with the length of the lease, the length of the renewal term
and the credit standing of Tenant to be taken in account. However, in no event
shall the rental in the renewal term be less than the rental in the primary term
of the lease or be more than 125% of the rental in the primary term of the
lease. Notice to Tenant's intention to exercise the option must be given to
Owner in writing not less than three (3) months prior to the expiration of the
original term of this lease. In the event Owner and Tenant fail to reach an
agreement on such rental rate and execute the corresponding renewal of the lease
two (2) months prior to the expiration of the initial term hereof, unless due to
Owner's delay or failure to negotiate in good faith and offer market rates as
herein provided, then at Tenant's option the exercise of the renewal option
shall be deemed withdrawn and this lease shall terminate at the stated
expiration of said initial term.
SECTION 15
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HOLDOVER
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Should Tenant continue in possession, with or without the consent of Owner,
after expiration of the term or after a forfeiture incurred, Tenant shall
continue paying the amount of rent specified in this lease and shall continue to
be subject to all of the terms and conditions of this lease, except that Tenant
shall be the tenant at will of Owner, and in no event a tenant from a year to
year or from month to month, and Tenant may be required to vacate the Premises
without notice and may be removed by legal process as upon a forcible and
unlawful detainer.
SECTION 16
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ATTORNEY'S FEES
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If it shall become necessary for either party to employ an attorney to
assert any right or enforce any obligation under this lease, after default, the
prevailing party shall be entitled to recover, in addition to all other costs
and expenses, the reasonable costs and charges of such attorney.
SECTION 17
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NOTICES
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All notices or communications required or permitted under this lease to be
given shall be in writing and shall be mailed or delivered to the respective
addresses set forth below, or to such other address as may be designated in
writing by either party.
To Owner as follows:
V.L. Cain
2100 Cain's Ln
Mansfield, Texas 76063
To Tenant as follows:
OSCA, Inc.
301 S. Sixth Avenue
Mansfield, Texas 76063
Attention: General Manager, Oil Tool Manufacturing Division
with copy to:
SECTION 18
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ENTIRE CONTRACT
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This lease contains the entire contract and agreement between the parties
relating to the demise of the Premises.
SECTION 19
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BENEFIT OF LEASE
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This lease shall inure to the benefit of and shall be binding upon the
heirs, legatees, legal representatives, successors and assigns of the parties,
subject to all the terms, conditions and contingencies set forth.
SECTION 20
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MEMORANDUM OF LEASE
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The parties hereby agree that, upon request of either party, each will
execute, acknowledge and deliver a short form of memorandum of this lease in
recordable form. Recording, filing and like charges and any stamp, charge for
recording, transfer or other tax shall be paid by the party requesting such
recording.
SECTION 21
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LAW APPLICABLE
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This is a lease under the laws of the State of Texas, and the validity and
applicability of its provisions shall be governed by the laws of Texas.
SECTION 22
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TERMINOLOGY AND CAPTIONS
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The terms "Owner" and "Tenant" as used in this lease shall be construed to
apply to the parties in the appropriate gender and number. The captions on this
lease are inserted only as a matter of convenience and for reference and in no
way define, limit, amplify or describe the scope of this lease or the intent of
any provision thereof.
IN WITNESS WHEREOF, the Owner and Tenant have executed this lease this, the
1/st/ day of January, 1998.
/s/ V. L. Cain
------------------------------
V. L. Cain
OWNER
AMENDMENT 1
This lease amendment is made and entered into by and between V.L. Cain, a
resident of Tarrant County, Texas (herein called "Owner"), and OSCA, Inc. a
Delaware corporation (herein called "Tenant").
Owner and Tenant agree to amend "EXHIBIT E LEASE", "SECTION 2 TERM OF
LEASE", item 2.1, as follows:
1) The rate of monthly rent shall adjust and be increased as illustrated
by the attached document "BUILDING/LEASE SCHEDULE" (herein called the
"Schedule").
2) All agreements between Owner and Tenant not specifically amended by
the Schedule, including those in "EXHIBIT E LEASE", "SECTION 2 TERM OF
LEASE", item 2.1, not specifically amended, shall remain unchanged and
in full effect.
IN WITNESS WHEREOF, the Owner and Tenant have executed this amendment this, the
1/st/ day of January, 1998.
/s/ V.L. Cain
----------------------------------------
V.L. CAIN
OWNER
/s/ Paul R. Cain
----------------------------------------
OSCA, INC.
BY:
Printed Name: Paul R. Cain
As Its: General Manager,
Oil Tool Manufacturing Division
TENANT
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OSCA/CAIN OIL. TOOLS
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Building/Mansfield Location
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FOR THE YEAR ENDING DEC. 31, 1998
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JAN. FEB. MARCH APRIL MAY JUNE JULY AUG. SEPT. OCT. NOV. DEC.
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Building/Lease
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Monthly Expenses $2,400 $2,400 $2,400 $2,400 $ 2,400 $2,396 $ 2,396 $2,396 $2,396 $2,396 $2,396 $ 2,396
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First Expansion $2,800 $2,800 $2,800 $ 2,800 $2,803 $ 2,803 $2,803 $2,803 $2,803 $2,803 $ 2,803
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Phase 1/Offices $ 507 $ 507 $ 507 $ 507 $ 507 $ 507 $ 507
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Phase 2/Offices $ 1,032 $1,032 $1,032 $1,032 $1,032 $ 1,032
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Building Addition $2,516 $2,516 $ 2,516
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Phase 3/Offices $ 417
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Phase 4/Offices $ 259
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Total $2,400 $5,200 $5,200 $5,200 $ 5,200 $5,706 $ 6,738 $6,738 $6,738 $9,254 $9,254 $ 9,254
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Additions
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First Building Expansion
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12,000 Sq. Ft
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Phase 1/Offices $22,554
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Sales/QC
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Building Addition $2,516
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10,500 Sq. Ft
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Completion 1001/98
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Phase 2/Offices $45,191
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Main Office
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Phase 3/Offices $16,862
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Second Floor/Eng.
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Phase 4/Offices $10,500
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Warehouse Office
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Building Square Footage Building Expansions Office Expansions
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Original 10,000 Sq. ft. Expansions are based at $2.875 ft. Cost of Expansion, divided by remainder of term
per Year of lease
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Second Addition 11,700 sq. ft. Lease on Building is a 5 Year Added in the month of completion, with 9.5%
Lease interest
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Third Addition 10,500 sq. ft. 01/01/98 - 12/31/03 Term of Lease is 5 Years from 01/01/98 until
12/31/03
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Total Sq. Ft 32,200 sq. ft.
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Bldg Lease Pymt. Adjustment as of 6/01/98 to 2.875 per ft.
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Page 1
[LETTERHEAD OF OSCA]
/s/ Paul R. Cain
-----------------------------
OSCA, INC.
BY:
Printed Name: Paul R. Cain
As Its: General Manager,
Oil Tool Manufacturing Division
TENANT