In accordance with the specific provisions of the PPP Project Deed, Responsible Agencies will usually need to consent to:
■ proposed refinancing of the PPP Project Company which exceed the quantum and tenure of debt as envisaged at financial close; and
■ updated Financial Models associated with any refinancing. Responsible Agencies must consult and seek advice from NSW Treasury on the proposed refinancing (including the financial model) as soon as the Responsible Agency is aware formally or informally of an upcoming refinancing, regardless of whether or not the Responsible Agency needs to provide formal consent to the refinancing.
NSW Treasury advice will draw from experience on other PPP project refinancing, particularly in the case of refinancing which:
■ result in a new Base Case Financial Model;
■ give rise to a refinancing gain share;
■ increase the amount of outstanding debt, relative to the current Financial Model;
■ defers the amortisation of debt relative to the current Financial Model;
■ incorporates an exotic swap; and
■ increases or is likely to increase or adversely change the State's risks or liabilities (whether actual or contingent).
Where there are no specific contractual provisions otherwise:
■ any proposed refinancing should not result in a debt balance, at any time between the date of the refinancing and the end of the concession, greater than the projected debt balances in the original Base Case Financial Model;
■ the transaction costs related to future debt refinancing should be appropriately allocated in the previous agreed Financial Model; and
■ any refinancing gains are to be shared between Government and the private party on a 50:50 basis provided the projected equity return at the time of the refinancing (taking into account any refinancing) is above that reflected in the previous agreed Financial Model.
NSW Treasury will also advise whether any PAFA Act Approval consent is required, including whether any associated Guarantee needs replacing or updating (refer also to section 3.5).
Any Responsible Agency consent to refinancing (including Consent Deeds) should not include amendments to the Project Deed. Any amendments to the Project Deed should be contained in an Amending (and Restatement) Deed.