Common use of Operating Expense Adjustment Clause in Contracts

Operating Expense Adjustment. At the end of the first four (4) Contract Quarters during the Applicable Term, HEP Operating shall calculate the aggregate operating expenses incurred in the operation of the Tulsa West Tankage (but such calculation shall not include extraordinary and non-recurring items of expense that are not reasonably expected to recur in future periods during the Applicable Term) (“Initial OPEX”). In the event that the Initial OPEX exceeds the Assumed OPEX for the Tulsa West Tankage set forth on Exhibit C, (A) HFRM shall, within ten (10) days of receiving an invoice from HEP Operating, reimburse HEP Operating an amount equal to (i) the Initial OPEX minus (ii) the Assumed OPEX (the “OPEX Reimbursement Amount”), and (B) from and after the first four (4) Contract Quarters during the Applicable Term, HEP Operating shall, increase the Base Tariff for the Tulsa West Tankage by the amount necessary to allow HEP Operating to recover the OPEX Reimbursement Amount during each subsequent four (4) Contract Quarter period for the remainder of the Applicable Term, and the Parties shall execute an amended, modified, revised or updated Exhibit C reflecting such aggregate OPEX as the new Assumed OPEX for the Tulsa West Tankage. In the event that the Initial OPEX is less than the Assumed OPEX for the Tulsa West Tankage, HEP Operating shall decrease the Base Tariff for the Tulsa West Tankage by the amount necessary to account for the difference between the Assumed OPEX for the Tulsa West Tankage and the Initial OPEX for each subsequent four (4) Contract Quarter Period for the remainder of the Applicable Term, and the Parties shall execute an amended, modified, revised or updated Exhibit C reflecting the Initial OPEX as the new Assumed OPEX for the Tulsa West Tankage.

Operating Expense Adjustment. At the end of the first four (4) Contract Quarters during the Applicable Term, HEP Operating shall calculate the aggregate operating expenses incurred in the operation of the Tulsa West Tankage (but such calculation shall not include extraordinary and non-recurring items of expense that are not reasonably expected to recur in future periods during the Applicable Term) (“Initial OPEX”). In the event that the Initial OPEX exceeds the Assumed OPEX for the Tulsa West Tankage set forth on Exhibit C, (A) HFRM shall, within ten (10) days of receiving an invoice from HEP Operating, reimburse HEP Operating an amount equal to (i) the Initial Inital OPEX minus (ii) the Assumed OPEX (the “OPEX Reimbursement Amount”), and (B) from and after the first four (4) Contract Quarters during the Applicable Term, HEP Operating shall, increase the Base Tariff for the Tulsa West Tankage by the amount necessary to allow HEP Operating to recover the OPEX Reimbursement Amount during each subsequent four (4) Contract Quarter period for the remainder of the Applicable Term, and the Parties shall execute an amended, modified, revised or updated Exhibit C reflecting such aggregate OPEX as the new Assumed OPEX for the Tulsa West Tankage. In the event that the Initial OPEX is less than the Assumed OPEX for the Tulsa West Tankage, HEP Operating shall decrease the Base Tariff for the Tulsa West Tankage by the amount necessary to account for the difference between the Assumed OPEX for the Tulsa West Tankage and the Initial OPEX for each subsequent four (4) Contract Quarter Period for the remainder of the Applicable Term, and the Parties shall execute an amended, modified, revised or updated Exhibit C reflecting the Initial OPEX as the new Assumed OPEX for the Tulsa West Tankage.