RICK L. KNUTH is the keeper of the Banking and Finance Law Spotlight Site.

Rick's practice focuses on assisting institutional and private lenders and borrowers in asset-based loan transactions, real estate financing, accounts receivable and inventory-based financing. He has over 30 years experience in loan documentation, mortgage and trust deed foreclosures, loan participations, credit opinion letters, workouts, and insolvency proceedings of all kinds. He counsels banks large and small in all aspects of their commercial credit relationships.

Look for postings by the other attorneys in our Commercial Lending and Banking Practice Group.

Keven M. Rowe (Group Leader)
Tom Berggren
Rick L. Knuth
Kyle V. Leishman
James W. Peters
Susan B. Peterson
Jacob Redd
George R. Sutton
Glen D. Watkins
Randon W. Wilson

Published Articles

"Fraudulent Checks- the 'Same Wrongdoer' Defense"
by Rick L. Knuth

Originally Published in Utah Banker Magazine Fall 2013.

Important Resources
Playing Favorites
Posted on Aug. 12, 2013

“Most-Favored Nation” is a term in international agreements, under which trade terms offered one nation are made no less favorable than the trade advantages given any other nation. In other words, the recipient gets the best deal the granting nation affords.

The commercial lending analog is the “MFL,” or “Most-Favored Lender” clause. Such an arrangement provides, for example, if Lender #1 has an x% default interest rate, and Lender #2 has a higher rate with the same borrower, Lender #1 can use an MFL to have the benefit of the other lender’s higher rate. Or an MFL would allow Lender #1 to take advantage of Lender #2’s more favorable loan to debt ratios, more frequent or detailed reporting requirements, or any other material protection that the borrower had agreed to with its other lenders.

Lenders want MFL provisions for obvious reasons: They want to be on the same footing with the borrower's other lenders, and don't want to have to wait to declare a default, after other lenders have already done so.

Usually, an MFL clause will make it clear that the MFL is the contract between the borrower and the lender with the MFL, and that changes to the relationship between the borrower and its other lenders do not subtract from the Most-Favored Lender’s rights. For example, if Lender #1 waives defaults based on a given lender protection, the MFL lender’s rights are not waived, even though that default is based on the provisions of Lender #1’s loan documents.


This post was written by attorney Rick L. Knuth

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Rick Knuth is a member of the American College of Mortgage Attorneys.

George Sutton was recognized in 2012 as Utah Attorney of the Year in Financial Services Regulation Law by Best Lawyers in America.

Rick Knuth was recognized in 2012 as Utah Attorney of the Year in Banking and FinanceLaw by Best Lawyers in America.

All eligible attorneys in this group are ranked AV Preeminent by Martindale-Hubbell.

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