Gains from refinancing of Relevant PFI Transactions (whether Qualifying or not) will be shared according to the following principles:
(i) No Existing Sharing Formula
Where there is no existing contractual entitlement for an Authority to share in Refinancing Gains, the Authority will be given a 30% share of the Refinancing Gain1 arising from Qualifying Refinancings. These calculations are to be performed in accordance with OGC Revised Guidance, substituting 30% for the Authority's share.
(ii) Existing Formula
Where there is an existing entitlement under the Contract or other project documentation for an Authority to share in refinancing gains (either specifically or as part of a wider profit sharing agreement) - which may not necessarily be limited to Qualifying Refinancings -both parties will abide by such an agreement, even in circumstances where the percentage share due to the Authority is less (or more) than 30%, subject to clauses 9(ii) and (iii) below.
(iii) Sharing
Both parties should investigate the merits of the Authority accepting its share of any gain in the form of an increase in the scope of services, subject to suitable tests of value for money and relevant procurement rules.
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1 OGC Revised Guidance provides for any sharing of refinancing gain to be after Base Case returns have been achieved by the PFI contractors.