M&A attorneys should treat each AI assignment or change-of-control flag as a candidate for review, not a finding that consent is required. A supervised reviewer should locate the exact provision in the executed agreement, confirm the operative version, and check defined terms, exceptions, cross-references, and amendments. Counsel should separately document the proposed transaction’s structure and evaluate the verified language under applicable law. Keep source verification and legal conclusions in different fields, with unresolved questions visible. Before using client documents, approve the tool’s permissions and confidentiality arrangements. Test the workflow on an authorized sample, check missed clauses as well as flagged ones, and stop reliance when source support or review controls fail. [1]
Make the responsible attorney own the verification standard
Define the task narrowly: identify candidate assignment and change-of-control provisions and produce evidence for counsel to review. The responsible M&A attorney should approve the document scope, supervise the reviewer, and decide what legal analysis is needed. A reviewer may prepare the evidence packet, but the AI should not decide whether a transaction requires consent or whether an exception applies.
ABA Formal Opinion 512, issued in July 2024, explains that independent verification depends on the tool and task, while professional judgment and responsibility remain with the lawyer. It interprets the ABA Model Rules, not a universally adopted set of jurisdictional requirements. Counsel should check applicable professional rules and client instructions before using the workflow. [1]
Use separate statuses for an AI candidate, source-verified language, missing context, and counsel’s analysis. Source-verified means the excerpt and its relevant context have been checked against the records. It does not mean the transaction has been cleared. This separation prevents a completed extraction task from being mistaken for a legal approval.
Approve confidentiality choices and fix the source record
Before uploading documents, have the responsible attorney and an appropriately qualified technology reviewer assess the tool’s terms, data use, retention, access permissions, and relevant client restrictions. Decide which records may be processed and who may see the outputs. Restrict the workflow to the authorized matter materials, without permissions to contact counterparties, transmit documents externally, or change approval records.
The ABA opinion calls for a fact-specific confidentiality assessment and understanding of relevant terms and policies. California’s 2026 bar guidance similarly warns against relying only on generalized marketing assurances and emphasizes limiting system access. Consent and disclosure obligations depend on the applicable rules, tool, matter, and risks. Neither selecting a privacy setting nor obtaining consent should be described as a guarantee of confidentiality, security, or privilege. [1] [3]
Build the source set from the executed agreement and available schedules, amendments, addenda, and relevant consent or waiver instruments. Record the parties, document date, version identifier, and stable page or section references. Check the page image when text was extracted from a scan. If the signed document or an incorporated attachment is unavailable, mark the source incomplete rather than substituting an earlier draft without explanation.
Read the full provision rather than accepting the flag label
Require each candidate flag to include a verbatim excerpt, document identifier, section number, and page locator. Open the original at that location and compare every operative word. Read the whole provision and enough surrounding text to establish its scope. A highlighted sentence may omit a qualification immediately before it or a proviso after it.
Record what the text addresses: assignment of the agreement, transfer of rights, delegation of obligations, merger, ownership change, or another stated event. Preserve any wording about direct or indirect changes, operation of law, partial transfers, timing, or written consent. Do not combine these into a generic transaction restriction. The Delaware decision discussed below illustrates why assignment language and a change-of-control restriction should not be treated as interchangeable. [2]
Check whether the restriction applies to one party or both, and whether the provision actually states a consent requirement, notice obligation, prohibition, termination right, or another consequence. Capture the stated consequence without turning it into an enforceability conclusion. If the model paraphrase changes the triggering event or omits limiting language, correct the record and retain the discrepancy for the reviewer’s error assessment.
Trace definitions, cross-references, and exception conditions
Follow each material defined term to its source. For a clause using Control or Affiliate, retain the contract’s actual definition rather than importing an ordinary-language meaning. Record the referenced entity and any stated ownership, voting, management, or other test. If a definition points elsewhere, follow that reference or identify the missing document. A confident model explanation is not a substitute for the definition.
Next, capture the complete exception and its conditions. An illustrative agreement might allow a transfer to an affiliate only if the original party remains liable and a specified notice is delivered. The verification task is to preserve those conditions, not to declare that a proposed buyer qualifies. Keep transaction facts needed to evaluate the exception in counsel’s analysis field.
Check cross-referenced notice provisions, successor language, and any clause that expressly deems a transaction to be an assignment or change of control. Read provisions together where they bear on the flag. In Meso Scale Diagnostics, the court considered the agreement as a whole and related transaction agreements rather than deciding from an isolated phrase. That supports contextual review, not a universal interpretation rule for every contract or jurisdiction. [2]
Resolve amendments and prior instruments before verifying the wording
Compare the flagged clause with every available amendment affecting its wording, definitions, or referenced provisions. Preserve both the original language and the change, with their source locations. Do not let a later document disappear because the model processed the base agreement first, or assume that the newest file replaces the entire agreement.
For a consent or waiver instrument, capture the parties, identified transaction, covered provision, and stated conditions. Label its relevance as pending counsel review. An instrument referring to an earlier transaction is not evidence that a different proposed transaction has been approved. Its scope and legal effect require analysis of the actual wording and applicable law.
If records conflict or a referenced amendment is missing, state precisely what is unresolved and assign a document-request owner. The flag may still identify a relevant provision, but its operative wording cannot be marked fully verified until the source issue is resolved. Keep that uncertainty visible in the evidence packet.
Separate transaction assumptions from counsel’s legal analysis
Counsel’s analysis should begin with a dated transaction description, not the AI label. Identify whether the proposal involves an asset transfer, equity purchase, merger, or multiple steps. State the relevant contracting entity, expected surviving entity where applicable, ownership changes, and any planned pre-closing reorganization. Ask the transaction team to confirm facts that are unknown. Do not allow the model to fill gaps with a customary structure.
A narrow historical example shows the importance of this separation. In Meso Scale Diagnostics v. Roche Diagnostics, decided in February 2013 and revised in March 2013, the Delaware Court of Chancery held that the reverse triangular merger before it did not trigger the anti-assignment provision at issue. The court distinguished the negotiated assignment restriction from a change-of-control provision that the parties had not negotiated. That result concerned Delaware law, the particular language, and the facts before the court. It does not establish that all mergers or ownership changes avoid consent requirements. [2]
The analysis field should therefore identify the applicable-law questions, counsel’s independently checked authority, and unresolved factual dependencies. This article supplies a verification framework, not transaction-specific legal advice. Qualified counsel must evaluate the actual transaction and current relevant law. Reopen the analysis if the deal structure changes, even when the verified clause wording stays the same.
Pilot for missed clauses and define stopping conditions
Before broader use, test an authorized sample against a manual review performed by a lawyer familiar with the task. Include amended documents, scanned pages, exception-heavy provisions, and agreements where the tool returns no flag. Compare both the excerpts produced and provisions missed. Reviewing only positive flags tests whether those flags are supported, not whether the workflow finds relevant language.
The ABA opinion discusses manually testing a subset of lengthy contracts when evaluating AI summaries, while leaving the appropriate review level dependent on the circumstances. California’s 2026 guidance emphasizes verification and reassessment when systems change or are used for new tasks. A successful pilot is evidence for a defined use, not permission to abandon professional judgment. [1] [3]
Set concrete stopping conditions before the trial: an excerpt cannot be located, an operative exception is omitted, an amendment is ignored, scan quality obscures triggering language, or the tool makes an unsupported consent conclusion. Suspend reliance on the affected workflow and identify the potentially affected records for manual review. Pause processing immediately if permissions or data-use terms change or an unauthorized transmission is attempted. Diagnose the issue and retest before resuming; do not let a high confidence score override missing source evidence.
Deliver a clause packet, not an automatic consent decision
For each verified candidate, deliver the source identifier and locator, exact provision, linked definitions, complete exceptions, relevant amendments, missing records, and reviewer identity. Add a separately labeled transaction-assumptions record and counsel’s analysis status. This is the clause-verification checklist: it shows what the agreement says, what evidence is missing, and what counsel still needs to decide.
Send the packet to the responsible attorney. Only counsel’s reviewed analysis should inform a subsequent deal-wide consent or approval inventory. The extraction workflow should not contact counterparties, negotiate terms, issue approvals, or disclose contract material. Where further work is needed, assign a human owner rather than letting an unresolved flag become an automatic clearance.
Acquivo is a software platform that delivers the entire sell-side M&A process, valuation, marketing materials, buyer matching, and deal management, on one platform for business owners, M&A attorneys, and boutique investment banks. It is user-operated software with no success fee, not a law firm or client representative. The verification framework described here is a recommended implementation approach, not a claim that Acquivo provides particular AI features or makes legal decisions.
Key Points
- Treat an AI flag as a candidate provision, not evidence that consent is required or unnecessary.
- Verify exact wording against the executed agreement, including definitions, exceptions, cross-references, and amendments.
- Keep source-verification status separate from counsel’s transaction assumptions and applicable-law analysis.
- Approve confidentiality and access choices before processing documents, and prohibit autonomous external transmission or approvals.
- Test no-flag documents as well as positive flags; stop reliance when source support, operative context, or permissions fail.
Sources and references
Source retrieval dates record research access, not article publication. Read our editorial and date policy.
- [1] American Bar Association Formal Opinion 512: Generative Artificial Intelligence Tools, July 29, 2024 · Accessed
- [2] Delaware Court of Chancery: Meso Scale Diagnostics, LLC v. Roche Diagnostics GmbH, decided February 22, 2013, revised March 8, 2013 · Accessed
- [3] State Bar of California: Practical Guidance for the Use of Generative Artificial Intelligence in the Practice of Law, 2026 revision · Accessed
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