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Covenant Tripwires: Cross-Default, MAC, and Change-of-Control Clauses That Can Surprise CFOs
February 15, 2026by Dr Dawkins Brown
Executive Summary Most covenant discussions focus on leverage and coverage ratios. But many real-world “defaults” are triggered by legal tripwires buried in documentation—cross-default / cross-acceleration, material adverse change (MAC) clauses, and change-of-control (CoC) provisions. These clauses can convert a manageable operational wobble into an urgent liquidity event, especially when debt is layered (bank loans +...
