Waterfall

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1. Liquidation - claims.

The priority order of claims in a liquidation.

Broadly speaking, this priority order is:

  1. Secured creditors
  2. Preferential creditors
  3. Fixed charge creditors
  4. Floating charge creditors
  5. Unsecured creditors
  6. Connected unsecured creditors
  7. Shareholders


Breaching this ordering is a preference, that can be effectively reversed by an order of the court.


2. Liquidation.

The allocation of - usually limited - available funds in this priority order in a liquidation.


3. Allocating limited funds.

Any other ranked allocation of funds.


4. Risk-free rates - valuation.

Abbreviation for waterfall methodology.


See also