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Between the hedges: a high-level comparison of rights, roles, and market practice for Hedge providers in U.S. leveraged and project finance transactions

Between the hedges: a high-level comparison of rights, roles, and market practice for Hedge providers in U.S. leveraged and project finance transactions
Published Date
Aug 26, 2026
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Todd KoretzkyPartner, New York
In this article, Todd Koretzky, Debt Finance partner at A&O Shearman, examines how U.S. leveraged finance and project finance transactions diverge in their treatment of hedging counterparties within the senior secured credit structure.
The author analyzes the documentation architecture, eligibility framework, governance and voting mechanics, waterfall priority, enforcement and standstill coordination, and payoff and release conditions that all parties must navigate when integrating hedges into the collateral package. The author demonstrates that the two markets adopt fundamentally different approaches to creditor governance and hedge continuity, and concludes with practical recommendations for lenders and other financing parties seeking to ensure that the legal documentation accurately reflects the intended allocation of rights and risks between the lending group and the borrower’s hedging banks.
This article has been previously published by The Banking Law Journal.

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Between the hedges: a high-level comparison of rights, roles, and market practice for Hedge providers in U.S. leveraged and project finance transactions

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