We have extensive experience in structuring hedge funds for US and EU managers and sponsors, and advising on all related regulatory issues and tax considerations. Our experience includes the establishment of master-feeder structures, mini-masters, funds of one, separately managed accounts and funds of funds. We have assisted clients in structuring ERISA plan asset funds, including both plan asset funds that trade in the markets directly and "hard-wired" feeders into non-plan asset masters. We also advise hedge fund managers on sub-advisory relationships, including acting as subadvisors to US registered investment companies and acting as advisors to sub-funds of UCITS-compliant umbrella funds.
We have assisted clients in structuring funds that utilize a variety of strategies, including event-driven, long-short, short-biased, long-only, value, credit, European, Asian, Latin American, sector-focused (including technology-focused and banking-focused) and algorithmic funds. Our firm also has extensive experience in private equity and real estate funds, CDOs and CLOs, and commodity pools, and we have advised hedge fund clients on the establishment of distressed debt and other hybrid funds. We assist hedge fund clients in preparing their offering and governing documents, and in negotiating side letters and advisory, administration, distribution and other agreements.
We regularly advise our hedge fund clients on the panoply of US regulatory regimes that apply to their businesses, including the Investment Advisers Act of 1940 (Advisers Act), the Investment Company Act of 1940, the Commodity Exchange Act (CE Act), the Securities Act of 1933, the Securities Act of 1934 (1934 Act), the Employee Retirement Income Security Act of 1974 (ERISA) and the various state securities acts ("blue sky" laws). Our advice regarding the Advisers Act includes assistance in preparing and filing Form ADV and Form PF and the design or review of compliance programs, and our advice regarding the 1934 Act includes assistance in preparing and filing Schedule 13D, Schedule 13G, Form 13F, Form 13H and Forms 3, 4 and 5. We also advise clients on the application of the Alternative Investment Fund Managers Directive (AIFMD), the European Market Infrastructure Regulation (EMIR) and the Markets in Financial Instruments Directive (MiFID), and assist clients in preparing and making transparency filings in the UK, throughout the EU and in other non-US jurisdictions. In the UK we advise on the application of and the rules and regulations of the Financial Conduct Authority and other financial service regulation.
Future, Swaps, and Other Derivatives
Our extensive derivatives and commodities experience includes the documentation of over-the-counter derivatives using ISDA and other forms, assisting fund managers with registering as commodity pool operators (CPOs) and commodity trading advisors (CTAs) under the CE Act, advising on the regulations that apply to registered CPOs and CTAs, and advising on exemptions from registration and seeking relief from certain of the burdens of registration.
Trading and Investment Documentation
We also provide ongoing assistance with trading and investment documentation, including:
- prime brokerage documentation
- depository and custodian agreements
- financing agreements providing for daily operations and redemptions
- secondary market opportunities (special situations credits trading, distressed debt, etc.)
- credit derivatives to obtain protection on specific assets
- equity derivatives to facilitate leveraged synthetic exposure to securities
- total return swaps
- purchase and sale agreements for privately negotiated transactions
In addition to representing managers and sponsors of hedge funds, we represent institutional investors, including pension funds, funds of funds, private foundations, US banks, university endowments, retirement plans, family offices, and sovereign wealth funds and other foreign institutions. These representations complement our manager/sponsor representations, and provide us with detailed knowledge of evolving market terms and solutions, as well as insights into the regulatory issues and other dynamics affecting institutional investors in hedge funds.
To complement our core hedge funds team and provide a full client-service team approach, our tax and ERISA teams support tax and ERISA planning and structuring for hedge funds and investors in funds, and advise on compensation arrangements for investment professionals. Hedge fund clients also benefit from our firm's extensive litigation resources and experience. Our litigation attorneys have significant experience representing hedge fund managers, investment advisers, brokerage firms, CPOs, CTAs and others in regulatory investigations before the SEC, FINRA and the CFTC, in arbitrations before the NFA and other tribunals, and in US federal and state courts.