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Best Efforts and Commercially Reasonable Efforts in M&A Agreements: Drafting and Interpretation Challenges

Lessons From Case Law for Interpreting Efforts Provisions and Avoiding Enforceability Pitfalls

Recording of a 90-minute premium CLE webinar with Q&A

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Conducted on Thursday, October 20, 2016

Recorded event now available

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This CLE course will provide practical guidance to M&A counsel for drafting enforceable best efforts and commercially reasonable efforts clauses in M&A agreements, including a discussion of how courts’ interpretations of the provisions have varied from state to state.


Parties to M&A agreements generally negotiate clauses in the deal documents requiring one or both parties to use their “best efforts” to secure stockholder approvals, antitrust and other regulatory approvals, opinion letters, financing and/or third-party consents prior to deal closing. In some states, “reasonable efforts” or “commercially reasonable efforts” provisions are instead used to convey the parties’ expected performance under the contract.

When a deal fails to close and disputes between the buyer and seller arise, interpreting efforts clauses often presents challenges for the parties, M&A counsel and the courts. Because counsel often fail to clearly define the actions that constitute “best efforts,” “commercially reasonable efforts,” or some variation thereof, courts have had a difficult time interpreting efforts clauses. While there is limited court guidance on this issue, a recent Delaware Court of Chancery case, Williams Companies v. Energy Transfer Equity L.P., provides some clarity on how Delaware courts will interpret efforts language.

Listen as our authoritative panel examines how courts have ruled in disputes centered around best efforts, reasonable efforts and commercially reasonable efforts clauses in M&A deal documents. The panel will discuss best practices for drafting clear and predictable efforts provisions that adequately reflect the parties’ expectations.



  1. Examples of common usage of best efforts, reasonable best efforts and commercially reasonable efforts clauses in M&A agreements
  2. Case law guidance
    1. What is required of parties to satisfy “best efforts,” "reasonable best efforts" and "commercially reasonable efforts" in M&A deals?
    2. How are courts applying the implied covenant of good faith and fair dealing when interpreting efforts provisions?
  3. Best practices for drafting efforts provisions in M&A agreements


The panel will review these and other key issues:

  • How are “best efforts,” “reasonable best efforts” and “commercially reasonable efforts” different?
  • What challenges do M&A counsel face surrounding the drafting and enforcement of efforts clauses?
  • How can counsel draft efforts provisions in their M&A agreements that clearly reflect the intent of the parties and do not promise too much or too little?


Mihanovic, Mark
Mark J. Mihanovic

McDermott Will & Emery

Mr. Mihanovic's practice is primarily focused in the areas of corporate finance and mergers and acquisitions...  |  Read More

Martin B. Robins


Mr. Robins practices extensively in the general corporate and corporate governance, M&A, finance, intellectual...  |  Read More

Bradley P. Nelson
Bradley P. Nelson


Mr. Nelson is a highly experienced trial lawyer and litigator, with a focus on complex business and intellectual...  |  Read More

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