A recently released report from the Brookings Institution entitled “America’s Advanced Industries: What They Are, Where They Are, and Why They Matter” highlights the strength and diversity of Utah’s economy. The report defines an industry as an “advanced industry” if it meets two criteria: 1) the industry spends heavily in research and development (R&D spending per worker in the 80th percentile or higher or more than $450 per worker); and 2) the industry employs workers with a high degree of STEM (science, technology, engineering, and math) knowledge above the national average of 21% of all workers. Using these criteria, the authors of the report identified 50 industries that invest heavily in research and development and employ highly skilled workers. These 50 industries include manufacturers, energy providers and service providers in a variety of industries, such as aerospace products and parts, motor vehicle-related manufacturing, computers and peripheral equipment, chemical products, energy industries, computer systems design, data processing and hosting, and software publishers. Many of these industries are developing “disruptive technologies” that are redefining both the workplace and our daily lives. Overall, the State of Utah was one of only seven states where more than 10% of the workers are employed in advanced industries. And the Salt Lake City, Provo-Orem, and Ogden-Clearfield metropolitan areas were all ranked in the top 15 among large metropolitan areas with the highest percentage of advanced industries employment. While Utah’s three largest metropolitan areas are among the leaders nationwide in advanced industries employment, the composition of that employment differs from region to region. Ogden-Clearfield’s advanced industries employment was geared more towards manufacturing industries, with Ogden ranking as one of the five areas most specialized in advanced manufacturing industries. Conversely, Provo-Orem, with a large number of technology companies contributing to its reputation as the Silicon Slopes, is one of the five areas with the highest concentration of advanced services industries. The report also identified Provo-Orem as one the fastest growing areas in the advanced industries area. Finally, Salt Lake City had a more diversified industry base, reflecting a mix of both manufacturing and service industries. Some Tips for Borrowers Negotiating a LoanNew loans are more complicated when a borrower already has an existing loan with another lender. It’s all about collateral. Here are some tips to keep in mind: 2. Inter-creditor Agreement. It’s common for two or more lenders to make loans secured by a single borrower’s collateral. To do this, they will enter into an inter-creditor agreement that specifies the priority of each lender’s collateral. There are two possible scenarios: (i) the lenders can split the collateral between them, each maintaining a first priority position (e.g., one lender will take inventory as collateral, and the other lender will take equipment), and (ii) each lender can take the same assets of the borrower as collateral, with one lender being in a first priority position and the other being in second position. Inter-creditor agreements can involve contentious negotiations between competing lenders, and it’s important for the borrower to have competent counsel to act play the role of a mediator. Many loan deals have failed to close because the lenders could not reach agreement on the inter-creditor document. 3. Payoff Letter. When a new loan will be paying off an old loan, the old lender will be asked to provide a letter that details exactly how much principal, interest and fees are outstanding. The payoff letter should also state that, upon payment in full of all amounts owing, the old lender releases its lien on the borrower’s assets. Some lenders forget their obligation to release liens, and it can cause future problems for the borrower. Experienced finance counsel will help the borrower remember this important step and save money in the long run. Loan Negotiation LawyerWhen you need legal help with loan negotiations, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
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