# First Inherited Risk Replay

**Proof #16 — June 2, 2026 — issued by H33, Inc. — Eric Beans, CEO**

> **"What did we just inherit?"**
> The buyer-value question that PE acquirers, insurers, reinsurers, fund administrators, boards, and regulators all ask the moment an acquisition closes. H33 answers it in one call.

---

## The killer query

```text
asl> show_inherited_risk(acquisition_001)

→ inherited from: tenant_acquired_44962d9b-25f5-5622-bd9a-98d5580bb8a2
→ inheritance policy: full

  counts_by_type:
    loss:                  2
    lawsuit:               1
    regulatory_action:     1
    operational_failure:   1

  counts_by_severity:
    financial:             2
    legal:                 1
    regulatory:            1
    operational:           1

  aggregate exposure:      $18,400,000
```

Every entry tagged with `origin_enterprise_id = tenant_acquired_…` —
so a diligence reader can tell, line by line, whether each
consequence originated **before** or **after** the acquisition.

---

## The buyer-value frame Eric locked

> *"PE / acquirers / insurers / boards / regulators / fund admins don't
> buy acquisitions — they buy reductions in unknown inherited risk."*

That sentence is the entire monetization theory of this proof.
Diligence today is a function of trust + paperwork + sampling. Inherited
Risk Replay is the first time a buyer can ask, *deterministically*, what
the company they just bought has already done — and what consequences
already exist on the books.

---

## Money slide

> **Inherited Consequences = Inherited Risk.**

Acquirers do not inherit the brand, the team, or the office space at
the moment of close. Those are negotiated. What they inherit
*irreducibly* is **the open consequences** — the lawsuits not yet
settled, the regulatory actions not yet closed, the operational
failures not yet remediated, the impairments not yet written down.

Until now, that inheritance was opaque. With H33-CANONICAL-AUTH-v1
plus the `origin_enterprise_id` schema extension and the new
`EnterpriseAcquisition` event kind, the inheritance is structural,
queryable, replayable, and verifiable five years post-close.

---

## Category claim

> **Consequences survive organizational boundaries.**

Mergers. Acquisitions. Divestitures. Bankruptcies. Reorganizations.
Roll-ups. Spin-offs. Carve-outs. In every one of those events, the
legal entity changes — but the *consequences* (the lawsuits, the
regulatory actions, the operational failures, the open claims, the
recognized losses) survive. They cross organizational boundaries
the way liabilities cross balance sheets at close.

Until now, no system reconstructed that crossing. H33 does — for
the first time, in this proof.

---

## New category endpoint

> **Institutional Continuity Infrastructure.**

The full endpoint progression the corpus now spans:

| | |
|---|---|
| Software | what most platforms ship |
| Evidence Infrastructure | what H33 ships at L4 |
| Accountability Infrastructure | what #14.1 (Replayable Responsibility) ships |
| Enterprise Causality Infrastructure | what #15 (Replayable Insurance Claim) ships |
| **Institutional Continuity Infrastructure** | **what #16 ships — consequences that survive boundaries.** |

Every prior endpoint is a special case of this one.

---

## Scenario

### Tenant A — the acquirer (6 events)

| Event | At |
|---|---|
| policy_register | T₀ |
| model_register | T₀ + 1d |
| grant (acquirer authority) | T₀ + 2d |
| decision (native business activity) | T₀ + 3d |
| consequence — native approval ($180K, financial) | T₀ + 4d |
| **enterprise_acquisition** — acquisition_001, policy = `full` | **T_ACQ** |

### Tenant B — the acquired (10 events, all *before* T_ACQ)

| Event | At |
|---|---|
| policy_register | T_B0 |
| model_register | T_B0 + 1d |
| grant (acquired authority) | T_B0 + 2d |
| decision (B-001) | T_B0 + 3d |
| decision (B-002) | T_B0 + 4d |
| **consequence: lawsuit** ($3.2M, legal) | pre-acquisition |
| **consequence: operational_failure** ($450K, operational) | pre-acquisition |
| **consequence: loss (loan_B_001 impairment)** ($2.8M, financial) | pre-acquisition |
| **consequence: loss (loan_B_002 impairment)** ($4.9M, financial) | pre-acquisition |
| **consequence: regulatory_action** ($7.05M, regulatory) | pre-acquisition |

**Aggregate pre-acquisition exposure on Tenant B: $18,400,000.**

---

## What replay reconstructs

Two independent replays — one per tenant — at T = March 2031 (≈5 years post acquisition):

- **Tenant A state_id** = `9581cc7b5cb7e29d48714c4b4be1c92cc1b0c2eb35357ba7d3be788fc9918add`
- **Tenant B state_id** = `bfb2bbe9bdb53a5b89970177b52a0b3c6cc51c3f2f55567020b6ff9cd11651fb`

Tenant A's snapshot contains:
- 1 native consequence (the approval baseline)
- 1 `AcquisitionRecord` — the inheritance anchor that names Tenant B,
  the inheritance policy (`full`), and both root principals.

Tenant B's snapshot contains:
- 5 pre-acquisition consequences spanning **lawsuit, operational_failure,
  loss × 2, regulatory_action**.

The aggregation helper `show_inherited_risk(acquisition_001)`:

1. Reads the AcquisitionRecord from Tenant A's snapshot
2. Replays Tenant B independently at the same T
3. Filters Tenant B's consequences to those with `at_ms ≤ T_ACQ`
4. Tags every result with `origin_enterprise_id = tenant_acquired_…`
5. Aggregates `counts_by_type`, `counts_by_severity`, and dollar amounts

Returns the exact 4-line buyer picture above, deterministically.

---

## Why the architecture is right

Cross-tenant replay does **not** require the engine to pull events
across tenants. Each tenant replays independently, byte-identically,
to its own snapshot. The inheritance view is composed *above* the
engine, from two consistent snapshots plus the AcquisitionRecord.

That is the discipline. The engine never crosses tenant boundaries.
The composition layer does — explicitly, traceably, and only when the
AcquisitionRecord says it should.

---

## Schema additions (single source of truth: scif-backend @ `d86891d3d`)

### Consequence event gains

```rust
origin_enterprise_id: Option<String>
```

- `None` for native consequences (created inside the tenant).
- `Some(tenant_id)` for consequences inherited from a prior enterprise.

This single field answers the **billion-dollar diligence question**:
*"Did this lawsuit originate before or after the acquisition?"*
Deterministically. From signed canonical events alone.

### New `EnterpriseAcquisition` event kind

```rust
EnterpriseAcquisition {
    at_ms,
    acquisition_id,
    acquirer_tenant_id, acquired_tenant_id,
    acquirer_root_principal, acquired_root_principal,
    inheritance_policy,   // "full" | "selective" | "novation"
    recognized_by, signature,
}
```

### Snapshot extensions

- `ConsequenceSnapshot.origin_enterprise_id: Option<String>`
- `AcquisitionRecord { acquisition_id, acquirer_tenant_id, acquired_tenant_id, acquirer_root_principal, acquired_root_principal, inheritance_policy, at_ms }`
- `AuthorityStateSnapshot.acquisitions: Vec<AcquisitionRecord>` (skip-if-empty)

All 16 prior proofs' state_ids verified byte-identical under the
extended engine.

---

## The Six Questions

| # | Q | A |
|---|---|---|
| 1 | What happened? | Acquirer (Tenant A) recognized acquisition of Tenant B with inheritance policy = `full`. Tenant B had 5 pre-acquisition open consequences. |
| 2 | Who had authority? | Acquirer root principal recognized the acquisition; acquired root principal is named in the record. |
| 3 | How was authority reconstructed? | Two independent replays at T ≈ March 2031 — one per tenant. Engine never crosses boundaries; aggregation helper composes the inheritance view. |
| 4 | What state was produced? | Two state_ids (A = `9581cc7b…`, B = `bfb2bbe9…`); one AcquisitionRecord; 5 inherited consequences; $18.4M aggregate. |
| 5 | What artifact was returned? | [`reconstruction.json`](reconstruction.json) — the AcquisitionRecord, the five inherited consequences each tagged with `origin_enterprise_id`, and the 4-line buyer picture. |
| 6 | How can a third party verify it? | Run `cargo test --test inherited_risk_replay_001 -- --ignored` against `scif-backend @ d86891d3d`. Both state_ids and the `$18.4M` aggregate must match byte-identically. |

---

## What this proof IS

The first proof where the H33 corpus crosses an organizational
boundary. The first proof where the deepest question of an
acquisition — *"what did we just inherit?"* — has a deterministic,
reproducible, cryptographically signed answer.

The substrate for every future product that touches diligence,
acquisition risk, fund-level reporting, cross-deal portfolio review,
representation-and-warranty insurance, board-level disclosure,
regulator-mode acquisition review, and post-close monitoring.

## What this proof IS NOT

A claim that any real acquirer has migrated yet. A claim that all
consequences from the acquired company are public — only the ones
recognized in the canonical event log are. A legal verdict — the
chain is structural fact. A reserving engine — this is the
evidentiary inheritance chain.

---

## Where this proof sits

| Proof | Status |
|---|---|
| #11 First Time Travel Replay (L5) | proven |
| #12 First Independent Replay (L9, the moat) | proven |
| #12.1 First Catastrophic Vendor Failure | proven |
| #13 First Replayable Enterprise | proven |
| #14 First Authority Lifecycle Replay | proven |
| #14.1 First Replayable Responsibility | proven |
| #15 First Replayable Insurance Claim (the convergence proof) | proven |
| **#16 First Inherited Risk Replay (institutional continuity)** | **proven now** |
| #17 Cross-Tenant Governance Replay | roadmap |
| #18 Asset Lineage | roadmap |
| #19 Regulator Mode | roadmap |

---

## Evidence appendix

| Field | Value |
|---|---|
| state_id (acquirer) | `9581cc7b5cb7e29d48714c4b4be1c92cc1b0c2eb35357ba7d3be788fc9918add` |
| state_id (acquired) | `bfb2bbe9bdb53a5b89970177b52a0b3c6cc51c3f2f55567020b6ff9cd11651fb` |
| Acquirer tenant | `tenant_acquirer_44962d9b-25f5-5622-bd9a-98d5580bb8a2` |
| Acquired tenant | `tenant_acquired_44962d9b-25f5-5622-bd9a-98d5580bb8a2` |
| acquisition_id | `acquisition_001` |
| inheritance_policy | `full` |
| Acquirer events | 6 |
| Acquired events | 10 |
| Inherited consequences | 5 |
| Aggregate inherited exposure | **$18,400,000** |
| counts_by_type | `loss: 2 · lawsuit: 1 · regulatory_action: 1 · operational_failure: 1` |
| counts_by_severity | `financial: 2 · legal: 1 · regulatory: 1 · operational: 1` |
| Reconstruction artifact | [reconstruction.json](reconstruction.json) |
| Harness | `tests/inherited_risk_replay_001.rs` |
| scif-backend SHA | `d86891d3d` |

---

## Readiness determination

**First Inherited Risk Replay: PROVEN IN OPERATION** for one acquisition
pair (1 acquirer tenant + 1 acquired tenant), 16 signed canonical events
total, 1 AcquisitionRecord reconstructed, 5 inherited consequences tagged
with origin_enterprise_id, **$18.4M aggregate inherited exposure** returned
by `show_inherited_risk(acquisition_001)` in one call.

What this unlocks: every diligence buyer (PE / insurer / acquirer /
fund admin / board / regulator) can now ask the deepest question they
ask the day after close — *what did we just inherit?* — and receive
a deterministic, signed, byte-identically replayable answer. The
category claim Eric named as the corpus endpoint at this depth:
**Institutional Continuity Infrastructure**.

What this does **not** unlock: a reserving engine for inherited risk;
a public registry of all corporate acquisitions; a legal verdict on
inherited liability allocation; an opinion on whether a given
acquisition was wise.

---

**Issued by H33, Inc.** · Eric Beans, CEO · 2026-06-02
Independently reconstructable. Inputs: scif-backend @ `d86891d3d` · `tests/inherited_risk_replay_001.rs` · [reconstruction.json](reconstruction.json).