ProfessionalsManuel S. Frey
A partner in the Corporate Department, Manuel Frey focuses on a broad-based cross-border OTC derivatives, structured products and hedge fund practice. He is closely involved in the structuring, negotiation and execution of derivative, synthetic and financing products and structures and the resolution of related credit, regulatory, legal and risk management issues. He also regularly assists M&A, capital markets, litigation, bankruptcy and finance teams with derivatives aspects of acquisitions, financing transactions and corporate restructurings. Manuel represents banks, investment funds and corporate end-users in the design and negotiation of OTC derivatives products and transactions including equity, credit, currency and fixed income products. He also counsels clients on the interpretation and implementation of various derivatives-related aspects of the Dodd-Frank Act and the changes to documentation and trading practices occasioned by the ongoing regulatory reforms.
Manuel has extensive experience negotiating and implementing OTC derivatives transactions and comprehensive derivatives documentation infrastructures, including ISDA Master Agreements and collateral arrangements, derivatives clearing documentation, repurchase agreements, master confirmation agreements, give-up agreements, prime brokerage relationships, distressed debt trading documentation and participation agreements from both the dealer and end-user perspectives.
Manuel’s derivatives and structured products experience includes:
- Repo-Based Asset Financing – Representation of major private equity funds and opportunistic hedge funds in the financing of loan and bond asset acquisitions and holdings through the use of repurchase agreements.
- Acquisition Finance through Total Return Swaps – Representation of a large private equity fund in the structuring and negotiation of total return swaps and other bespoke synthetic instruments used to finance acquisition of portfolio company indebtedness and equity.
- Synthetic Warehouse Financing – Representation of a global financial institution as swap provider under synthetic warehouse facilities in form of loan total return swaps to extend leverage and/or bridge financing to investment funds and CLO sponsors.
- Synthetic Leveraged Financings through Total Return Swaps – Representation of distressed opportunities investment funds in the monetization of large bankruptcy claims portfolios, single-borrower loan positions and swap portfolios with continued synthetic exposure to the underlying asset positions through total return swap transactions.
- Total Return Swap on Repackaged Notes – Investment funds in the structuring and negotiation of a repackaged total return swap financing facility to obtain secured credit against an existing loan and bond portfolio, including structures involving the formation of multiple bankruptcy-remote special purpose vehicles to borrow, maintain synthetic exposure to the reference portfolio and continue to control voting rights over the loans and bonds.
- Structured Loans Secured by Distressed or Illiquid Assets – Representation of a major U.S. bank as lender in the structuring and negotiation of full recourse loans to hedge funds secured by bankruptcy claims, equity positions, commodities, loans and other distressed or illiquid asset pools and supported by credit default swap protection.
- Spin-off of Proprietary Trading Platform and Creation of Hedge Fund – Representation of the global principal strategies division of a U.S. broker-dealer in the spin-off from the broker-dealer and establishment of an independent hedge fund, including the negotiation of total return swap and repo-based asset transfers, financing agreements, establishment of a prime brokerage, give-up and derivatives trading infrastructure and ongoing trading advice.
- Accelerated Share Repurchase Transactions – Representation of issuers in collared and uncollared accelerated share repurchase transactions through forward contracts.
- Equity Collar Hedge – Representation of an investment fund in the structuring of a cross-border collar transaction to hedge a concentrated stock position including securities lending arrangements and borrowing facility relating to the underlying put and call options.
- Convertible Note Hedge/Call Spread – Representation of U.S. and foreign investment banks and issuers in structuring and negotiating call spread transactions and share lending arrangements in connection with convertible note issuances. Representation of acquirers in negotiated unwinds of note hedge and warrant trades in connection with make-whole fundamental change transactions.
- CDS Advice – Representation of numerous buy-side firms in their analysis and advocacy regarding actual and potential credit events and succession events including Caesar’s, Hovnanian, iHeart Communications, McClatchy, Sears and Windstream, and participation in ISDA working groups considering amendments to the Credit Derivatives Definitions and DC Rules framework in connection with “narrowly tailored credit events.”
- Accounts Receivable Puts – Representation of suppliers and hedge funds in the negotiation of default protection agreements referencing various distressed companies, consisting of options to put accounts receivable claims to the protection seller in a bankruptcy of the reference entity and related claims transfer agreements.
- Regulatory Capital Relief Transactions – Representation of investment funds as protection sellers in regulatory capital relief transactions involving credit-linked note and credit default swap structures.
- CDS on CDO Litigation – Representation of a major U.S. bank as defendant and counter-plaintiff in a breach of contract action under a credit default swap on collateralized debt obligations with pay-as-you-go or physical settlement.
Derivatives Trading and Regulatory Advice
- Cryptocurrency Trading Advice – Representation of investment funds and high net worth individuals in the negotiation of cryptocurrency derivatives trading documentation, collateral agreements, execution and custodial arrangements and related regulatory analysis.
- Deal-Contingent Acquisition Hedging – Representation of private equity and hedge funds regarding foreign exchange and interest rate exposure in connection with offshore acquisitions and dispositions, non-USD investor contributions and financial covenant compliance, and negotiation of deal-contingent trading platform documentation required to implement related strategies.
- OTC Derivatives Trading Documentation Infrastructure – Representation of large and medium-sized hedge funds, private equity funds and hybrid investment vehicles in the structuring, negotiation and implementation of the comprehensive suite of derivatives trading documentation (ISDA Master Agreements, collateral agreements, Futures Account Agreements and derivatives clearing documentation, repurchase agreements, prime brokerage, master confirmation agreements, securities lending, give-up arrangements and related documentation) and provision of specific trade-related analysis and advice.
- Swaps Regulations Compliance – Representation of U.S. and non-U.S. financial institutions and corporate clients in the analysis, implementation and compliance with Dodd-Frank, EMIR and other derivatives regulations, including the cross-border application of CFTC swap regulations, clearing and reporting obligations, swap dealer/major swap participant registration and uncleared swaps requirements.
- Interest Rate, Commodity Price and FX Hedging Platforms – Representation of swap providers and borrowers in connection with requisite and discretionary interest rate, commodity and FX hedging transactions under syndicated secured loan facilities and project financings and negotiation of related trading platform documentation.
- Energy and Commodity Transactions – Representation of power provider in the negotiation and structuring of derivatives and financing transactions involving carbon emissions rights, electricity transmission and other offtake agreements.
Derivatives and Bankruptcy
- Derivatives and Bankruptcy – Representation of the steering committee of first lien lenders of Texas Competitive Electric Holdings Company LLC (TCEH) in connection with TCEH’s outstanding interest rate and commodity swap portfolios and related swap claims trading issues.
- Claims Trading Advice – Representation of major U.S. bank as market maker in the Lehman and Eastman Kodak bankruptcy claims trading secondary markets. Representation of the bank in its acquisition of approximately $8 billion in claims against Westinghouse Electric Company, LLC and its affiliates, and approximately $2 billion in related guarantee claims against non-debtor Toshiba Corporation, and subsequent participations and assignments of the claims to a creditor consortium.
- Insolvency Strategic Advice – Representation of Citibank NA and its broker-dealer and unregulated affiliates in connection with the resolution of their derivatives claims portfolio in the Lehman Brothers, Chrysler and MF Global bankruptcy proceedings.
Manuel speaks and writes frequently on various topics. Each year, he authors the USA chapter of the International Comparative Legal Guide (ICLG) to Derivatives, most recently in 2022. Since 2014, Chambers Global has recognized Manuel in Capital Markets: Derivatives, in which observers singled out his understanding of client needs and “substantive expertise.” He also has been continually recognized in Chambers USA since 2014 for his work in derivatives, and by The Legal 500 as a leading lawyer for his work in structured finance.