Alternative dispute resolution provisions are frequent inhabitants of all sorts of contracts. In the M&A world, they might govern the means of resolving a purchase price adjustment, a representation breach, or an escrow dispute.
Arbitration provisions also are frequently included in representations and warranties insurance policies, which are increasingly used to insure the risk of loss caused by a representation breach. It is crucial that M&A practitioners understand the implications of an agreement’s arbitration provision and how to draft an arbitration provision that serves their clients’ needs. This article will discuss five issues that counsel should consider when drafting an arbitration provision and provide insights on how to effectively craft an arbitration clause to enable the efficient and cost-effective resolution of M&A disputes in domestic arbitration.