  Not all contracts are good, but all good contracts can be expressed as a
finite-state transition system ("State-Transition Contracts"). Contracts that
can be represented as State-Transition Contracts discretize fat-tailed risk to
foreseeable, managed risk, define the boundary of relevant events governed by
the relationship, and eliminate the potential of inconsistent contractual
provisions. Additionally, State-Transition Contracts reap the substantial
benefit of being able to be analyzed under the rules governing the science of
the theory of computation. Simple State-Transition Contracts can be represented
as discrete finite automata; more complicated State-Transition Contracts, such
as those that have downstream effects on other agreements or complicated
pathways of performance, benefit from representation as weighted finite-state
transducers, with weights assigned as costs, penalties, or probabilities of
transitions. This research paper (the "Research" or "Paper") presents a complex
legal transaction represented as weighted finite-state transducers.
Furthermore, we show that the mathematics/algorithms permitted by the algebraic
structure of weighted finite-state transducers provides actionable, legal
insight into the transaction.
