Common use of Cost and Expense Clause in Contracts

Cost and Expense. Insurance premiums and any other costs or expenses with respect to the insurance or self-insurance required under Section 12.02, including any Retirement Community Retention, shall be paid from Gross Revenues as Operating Expenses. To the extent that such costs or expenses include reimbursement by Operator of its own costs or expenses, or those of one of its Affiliates, such costs or expenses shall be generally competitive (as calculated over the Term of this Agreement) with costs and expenses of non-affiliated entities providing similar services. Such premiums and costs shall be allocated on an equitable basis to the retirement communities participating under Operator's blanket insurance or self-insurance programs. Any reserves, losses, costs or expenses which are uninsured (unless required to be insured under Section 12.02) shall be treated as a cost of insurance and shall be Operating Expenses. Upon Termination, an escrow fund in an amount reasonably acceptable to Operator shall be established from Gross Revenues (or, if Gross Revenues are not sufficient, with funds provided by Owner) to cover the amount of any Retirement Community Retention and all other costs which will eventually have to be paid by either Owner or Operator with respect to pending or contingent claims, including those which arise after Termination for causes arising during the Term of this Agreement. Upon the final disposition of all such pending or contingent claims, any unexpended funds remaining in such escrow shall be paid to Owner, and Operating Profit for the final Fiscal Year shall be recalculated as a result of any claims paid and Operator and Owner shall each pay the other such amounts as may be required as a result of such adjustment.

Cost and Expense. A. Notwithstanding any other provision of this Article, insurance requirements contained in the Existing Mortgage (for so long as they remain in place) shall take precedence over this Article. B. Insurance premiums and any other costs or expenses with respect to the insurance or self-insurance required under Section 12.02Sections 12.02 and 12.04 A, including any Retirement Community Hotel Retention, shall be paid from Gross Revenues as Operating ExpensesDeductions. To the extent that such costs or expenses include reimbursement by Operator Management Company of its own costs or expenses, or those of one of its Affiliates, such costs or expenses shall be generally competitive (as calculated over the Term of this Agreement) with costs and expenses of non-affiliated entities providing similar services. Such premiums and costs shall be allocated on an equitable basis to the retirement communities hotels participating under OperatorManagement Company's blanket insurance or self-self- insurance programs, provided, that incremental premiums and costs incurred pursuant to Section 12.04 A shall be borne solely by the Hotel rather than being allocated to other hotels. Any reserves, losses, costs or expenses which are uninsured (unless required to be insured under Section 12.02) shall be treated as a cost of insurance and shall be Operating ExpensesDeductions. Upon Termination, an escrow fund in an amount reasonably acceptable to Operator Management Company shall be established from Gross Revenues (or, if Gross Revenues are not sufficient, with funds provided by Owner) to cover the amount of any Retirement Community Hotel Retention and all other costs which will eventually have to be paid by either Owner or Operator Management Company with respect to pending or contingent claims, including those which arise after Termination for causes arising during the Term of this Agreement. Upon the final disposition of all such pending or contingent claims, any unexpended funds remaining in such escrow shall be paid to Owner, and Operating Profit for the final Fiscal Year shall be recalculated as a result of any claims paid and Operator and Owner shall each pay the other such amounts as may be required as a result of such adjustment.. END OF ARTICLE XII