The claim lenders' hold on cash flows in a company with outstanding risky debt is often thought of as:

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Lenders with outstanding risky debt in a company can be thought of as selling a put option on the firm's assets and holding a risk-free bond. This is because they have the right to "put" the company into default or bankruptcy if it fails to make its debt payments, similar to how a put option gives the holder the right to sell an asset at a specified price. The risk-free bond represents the promised debt payments under the assumption of no default.

The Claim Lenders' Hold on Cash Flows in a Company