14.3.2  Compensable Enhancements

Additional rent payments may also include a predetermined percentage of any increased revenue generated from enhancements resulting from government actions or policy (a "compensable enhancement").

In the case of tollroad projects, such enhancements may include improvements to the transport network which increases the use of the tollroad. For example, this may include the connection of a new road to the tollroad or the construction of a new road, the extension, alteration or upgrade of existing roads, the

construction of new public transport routes or services and extension, alteration and upgrade of existing public transport routes. Government is able to share in the additional revenue even if the traffic forecasts in the Base Case Financial Model are not being met.

Conversely, any change to the network which causes a reduction in revenue is a "negative compensable enhancement". Such a reduction in revenue may be set off against any increase in revenue that the private party would otherwise have had to share with government.

If the network change has been assumed in the project agreement and the private party's Base Case Financial Model and that network change is completed on or after the anticipated date for Completion for that network change specified in the project agreement, then it will not be included in any calculation of a compensable enhancement or negative compensable enhancement. If however, the network change is completed prior to the estimated time then its effects can be included in the calculation of a compensable enhancement or negative compensable enhancement.