| busin., proj.manag. |
cash waterfall (Cash waterfall during the operation phase of a project During the operational phase, the cash flows of a project become more complex. Revenues and other ancillary amounts (such as VAT refunds and insurance payments) are being paid to the project company and the project company is incurring a larger number of periodic operating and maintenance expenses, not to mention debt service expenses under the finance documents. In addition, the finance documents may require that various reserve accounts be established and maintained at certain funding levels. With these competing demands on cash flows, a cash waterfall provision is a common tool used by financiers to ensure the cash flows are applied to settle the most important items first. andrew_egroups) |
