For example, a variant of the credit default swap is the “first-to-default” put. In this case, assume a Bank holds a portfolio of four high yield loans rated B, each one with a nominal value of $100 million, a maturity of five years and an annual coupon of Libor plus 200 bp. The loans are chosen such that default correlations are very small, i.e., such that there is a very low ex-ante probability that more than one loan will default over the time until the expiration of the put, say two years. A first-to-default put gives the Bank the opportunity to reduce its credit risk exposure, by being compensated in case one of the loans in the pool of four loans defaults at any time during the two-year period. If more than one loan defaults during this period, the Bank is only compensated for the first loan that defaulted.
We also need to consider a cross-default provision, which means if an organization has, for example, 6 different bonds out there, and defaults on one of them, then that is considered to be a default on all of them - see first to default, above.
Generic downgrade is missing - distressed ratings downgrade should be a subclass of that. If you are downgraded below a certain level then there may be consequences, such as a distressed ratings downgrade, more of a trigger. In order to be an event you have to pass a certain threshold. Same for fall in price.