DIP-78 Operating Agreement Amendment

GM DOPE DAO

MIDAO have recently updated their KYC requirements to line up with the evolving situation that pertains to DAO’s and their status as Legal Entities. As you can see in the picture below the old compliance only mentions ‘beneficial owners’ with 25%+ governance rights. This was the guidance given to us during our registration process. You will see that, to reflect international standards, RMI has moved to direct that DAO LLC’s also KYC any Managing Members.

This does not impede DOPE DAO’s ability to continue as we are. As a true DAO we do not have any Managing Members that would meet the definitions applicable to the international standards. However I propose making some slight amendments to our Operating Agreement to more accurately describe our process and to align the wording to account for this recent development. This change is to reflect that those Members who conduct work within Dope Labs are more accurately described as fulfilling necessary administrative duties, and that the true ‘Management’ of the DAO is conducted by our decentralised protocols via the Official Proposal Process.

In the interest of efficiency I will also propose a couple of additional small amendments that have come to light in recent months.

PROPOSED CHANGES WITH REGARD TO MANAGING MEMBERS.

This issue is relevant to the following articles. I will display the original text and proposed change.

ARTICLE IV (OLD) RIGHTS AND DUTIES OF MEMBERS IV.1 Management Rights. All Members who have not Dissociated (as defined in Article X) shall be entitled to vote on any matter submitted to a vote of the Members at a meeting, via writing, or via smart contract. Except as otherwise provided in this Agreement, any difference with respect to the ordinary course of the business shall be decided via a vote of the Members and shall require approval or consent of a majority vote by at least 6.25% of the Membership.

ARTICLE IV (NEW) RIGHTS AND DUTIES OF MEMBERS IV.1 Voting Rights. All Members who have not Dissociated (as defined in Article X) shall be entitled to vote on any matter submitted to a vote of the Members at a meeting, via writing, or via smart contract. Except as otherwise provided in this Agreement, any difference with respect to the ordinary course of the business shall be decided via a vote of the Members and shall require approval or consent of a majority vote by at least 6.25% of the Membership.

ARTICLE V (OLD) MEMBER MANAGEMENT V.1 Member Management. The ordinary and usual decisions concerning business affairs of the Company shall be made by contributing Members composed into "Core Units". V.1.1 Core Units shall be comprised of contributing Members who have the required ability, availability and willingness to participate. The Core Units will complete the day to day functions of the DAO necessary to administer the Purpose of the DAO. The DAO shall vote, via the DAO Governance Mechanism, to fill and fund these Core Units on a six monthly basis in advance.

ARTICLE V (NEW) PROTOCOL MANAGEMENT AND MEMBER ADMINISTRATION V.1 Protocol Management. The management of the DAO, in all respects, shall be conducted via the DOPE DAO decentralised protocols as described in this Operating Agreement, principally Article VI DOPE DAO GOVERNANCE MECHANISM. V.2. Member Administration. The ordinary and usual administrative affairs of the Company shall be completed by contributing Members composed into "Core Units". V.2.1 Core Units shall be comprised of contributing Members who have the required ability, availability and willingness to participate. The Core Units will complete the day to day functions of the DAO necessary to administer the Purpose of the DAO. The DAO shall vote, via the DAO Governance Mechanism, to fill and fund these Core Units on a six monthly basis in advance.

PROPOSED OPP CHANGE.

In recent DAO discussions it has been highlighted that the requirement of 5 DOPE Tokens to initiate an Off-Chain vote is too high a barrier for participation. The proposed amendment reduces this number to 3 DOPE Tokens. Our system is structured to allow maximum democratic value, with 1 DOPE equaling 1 Vote whilst making it practical during times of high Gas exposure via the use of delegates. This means that the Off-chain vote occupies the position of importance to allow the DAO to truly express its intentions. In the past there has not been a formal quorum or time requirement for the Off-Chain vote. This was due to worry that we may be setting an unreachable bar with regard to participation levels and imposing an unreasonable time constraint of the whole proposal process. However I believe that, because the Off-Chain aspect represents the more democratic ‘will’ of the DAO that it should have these important parameters surrounding it. This is important to ensure that the Proposals, put through the OPP, are suitably considered by a sufficient portion of the DAO over a sufficient time period. So you will see the changes below that introduce a quorum and voting time period requirement for the Off-Chain vote. Remember that there is allowance under VI.2 Fundamental Transactions, for ‘pre-established and precedented objectives’ to proceed straight to On-Chain vote to expediate governance. If you think of a regular type transaction that takes place like hosting or maintenance costs, these don’t have to got through the whole procedure.

ARTICLE VI (OLD)

DOPE DAO GOVERNANCE MECHANISM Vl.1 Official Proposal Process. The Official Proposal Process for any new order of business that relates to the functioning of the DAO shall begin with an "Off-Chain Proposal". This Off-Chain Proposal shall consist of a written description of the matter that is then submitted to vote on a suitable "Off-Chain Voting Mechanism". This proposal must then be made available for preview by DAO Members. VI.1.1 The Off-Chain Voting Mechanism must be such that a minimum of 5 DOPE Tokens are required for a Member to operate the Off-Chain Vote Mechanism. This Off-Chain Voting Mechanism must only count votes that represent Member owned DOPES and not delegated votes. The voting period must last a minimum of 72 hours. VI.1.2 Once the Off-Chain Vote has passed by majority vote, the proposal can proceed to a vote as an "On-Chain Proposal" on a suitable "On-Chain Voting Mechanism". The On-Chain Proposal must be the same in substance as the Off-Chain Proposal that passed by majority vote.

VI.1.3 The On-Chain Voting Mechanism must be such that a minimum of 50 DOPES, owned or delegated, are required for a member to operate the On-Chain Voting Mechanism. The On-Chain voting mechanism shall count votes that represent owned DOPES and delegated votes, the voting period must last a minimum of 120 hours. The On-Chain vote is an automated majority pass function once a quorum of 500 votes has been met.

VI.2 Fundamental Transactions. Any proposal to use capital, IP or other asset as owned by the Company is determined as a Fundamental Transaction and must pass through the complete Official Proposal Process as described in Article VI.1 - VI.1.3. Exceptions to this rule may be made whereby a proposal designates the use of Capital, IP or other Asset to be distributed to a pre-established and precedented objective. In these instances proposals may proceed straight to an On-Chain Proposal to be put to vote.

ARTICLE VI (NEW) DOPE DAO GOVERNANCE MECHANISM Vl.1 Official Proposal Process. The Official Proposal Process for any new order of business that relates to the functioning of the DAO shall begin with an "Off-Chain Proposal". This Off-Chain Proposal shall consist of a written description of the matter that is then submitted to vote on a suitable "Off-Chain Voting Mechanism". This proposal must then be made available for preview by DAO Members. VI.1.1 The Off-Chain Voting Mechanism must be such that a minimum of 3 DOPE Tokens are required for a Member to operate the Off-Chain Vote Mechanism. This Off-Chain Voting Mechanism must only count votes that represent Member owned DOPES and not delegated votes. The Off-Chain vote must meet quorum of 500 DOPES and the voting period must last a minimum of 120 hours. VI.1.2 Once the Off-Chain Vote has reached quorum and passed by majority vote, the proposal can proceed to a vote as an "On-Chain Proposal" on a suitable "On-Chain Voting Mechanism". The On-Chain Proposal must be the same in substance as the Off-Chain Proposal that passed by majority vote.

VI.1.3 The On-Chain Voting Mechanism must be such that a minimum of 50 DOPES, owned or delegated, are required for a member to operate the On-Chain Voting Mechanism. The On-Chain voting mechanism shall count votes that represent owned DOPES and delegated votes, the voting period must last a minimum of 120 hours. The On-Chain vote is an automated majority pass function once a threshold of 500 affirming votes has been met.

VI.2 Fundamental Transactions. Any proposal to use capital, IP or other asset as owned by the Company is defined as a Fundamental Transaction and must pass through the complete Official Proposal Process as described in Article VI.1 - VI.1.3. Exceptions to this rule may be made whereby a proposal designates the use of Capital, IP or other Asset to be distributed to a pre-established and precedented objective. In these instances proposals may proceed straight to an On-Chain Proposal to be put to vote.

This concludes the proposed changes.

TLDR:

Protocol Management, not Member Management.

3 DOPES to initiate Proposals, not 5. Quorum of 500 and minimum time 120hrs.

Tani