Arises when credit deterioration could be compounded by provisions such as financial covenants or rating triggers. These can put significant pressure on the company’s business or on its liquidity. For instance, if a company owes $100,000 and has a lending covenant that says it must pay off some portion (or all) of the loan if

A provision in an executive’s employment agreement that entitles the company to take back some compensation, or declare compensation not owed, under certain situations, such as fraud. This has become much more prevalent in the last few years, since the Enron and Adelphia debacles.