Panicked

State during which you are running, can't rest, and can't attack unless you are cornered. This state can be cured naturally by waiting for a bit, or by consuming alcohol. There is one artificial cure: applying a Horn of Bravery. Be warned that the horn takes time to 'recharge' and - like Susan's Horn - should only be used in time of great need.

You, allies, or enemies become panicked usually after sustaining a great amount of damage in general, having a limb severed, or upon seeing an adversary with drastically higher stats. You'll get the message "You are horrified by your situation!" if you're on the receiving end of the last one.