What's up, everybody? How's it going? Welcome
to... Welcome to the Sandowl Podcast number 60.
Thank you so much for the raid, Lucas and Kami,
coming from the Sandbox game. What you are in
now is the Sandowl Podcast, which is all about
the Sandbox DAO. Today is our 60th episode. 60
episodes. We started this last May when the DAO
began. And today is one of the concluding episodes
for a four -part miniseries where we went over
quite a bit. Started with Sandow 34. We looked
into the sandbox style's beginnings. And then
fast forward to Sandow 56. We did a reading of
the Cayman Islands law. 57, which was not that
long ago, a couple weeks ago, we did a review
of the Dow case law. And 59, which we did last
week, where we had two Cayman Islands. lawyers
on to help us talk about things, all sorts of
things regarding foundation companies, how they're
formed, did a lot of Q &A answering. So today,
as I mentioned, is part four, where we are going
to do a read -through of the memo of association
and articles of association for the Sandbox Dial
Foundation. And a lot of these things you'll
have already heard in a previous podcast. Thank
you again to Kami and Lucas for rating. Hello,
Tom Voxel, King Charles, Jazz Wolf. I see all
y 'all in the chat. Happy you're here. So scope
of the talk, it's going to be an analysis of
the facts. It's going to be all things that are
public. There's no accusation or smear campaign
going on here. It's all about transparency to
help us, help us to make good decisions within
our DAO. Hello, Dr. Metaverso. Salam Avivi. All
great people. Disclaimer. I do not represent
the Sandbox Game or the Sandbox Foundation. I
am not your financial or legal advisor. Nothing
I say is to be taken as financial or legal advice.
I'm just a community member. That's all I am.
Just a community member. When I say the word
SIP, I mean Sandbox Improvement Proposal. When
I use the word DAO, I mean Decentralized Autonomous
Organization. And when I say SandFam, I mean
Sandbox community, those who participate in the
people, product, and purpose of the Sandbox ecosystem.
That ecosystem looks a little bit like this.
We went over in Sandbox, or excuse me, Sandow31.
It's still my highest viewed episode. Sandow31.
Just a nice little... That was Sandow31 way,
way back when. And today's episode is squarely
within the DAO. Just look a little bit over here.
Or I guess... That way, yeah, that way. It's
squarely on the DAO here and what it is that
we do, how we do things. So in the people sector,
you have the gamers all the way down to the Sandbox
team, which is thankfully, thank you very much
for the raid, for the Sandbox team, the product,
everything from the game client to the DAO itself,
and the purpose was originally described in the
white paper back in 2020 and also expounded upon
by Sebastian Bourget and Artham of the Deed,
who is the co -founders. And then Yatsu, who's
chairman of Animoca Brands. All that comes together
to form the ecosystem. I am your host, Lanzer.
I am president of MetaWorlds, which is a studio
we've published two experiences, Floor Droppers
and Lava Defense, which was Game Maker Fun 2023
and Builders Challenge 1. And we made it into
Alpha Season 4. I still have to pinch myself
every day that we actually made it into Alpha
Season 4 for Floor Droppers. Today is four -part
series. Part one was episode 56. That was way
back in January. So two months ago. That where
we went over Cayman Island Law. We went over
the reading of the various laws. We actually
read through them. Talked about all the interesting
stuff that we had to get through in order to
figure out. What is it that we are doing in the
Cayman Islands? We heard a nice story from Kami
about how things became the way they were, how
the Cayman Islands became a British protectorate,
why they don't have income, taxable income, or
any sort of income on corporate revenue. Because
story goes, way back when, they saved a British
monarch or member of the British royal family.
The British monarch, the king at the time said,
what do you want? It's yours. And they said,
we want to be never taxed by the British Empire.
And hence why they still do it. That's a myth.
And I will, when I do probably part five, I'm
going to try and get the lawyers back on, do
a Q &A. I'm going to ask them that because they
live there. So that was part three. So part one
was researching the Cayman Islands law. We talked
about it. We applied it as best we could. Then
part two, we discussed with Ernest Lee, a practicing
attorney in the United States. We talked about
case law, what has been decided in court. Comparison
of DUNA's, LLD's, DAO LLC's, and trusts to Gurney
Trusts. Part three, we just did, which was a
look into foundation companies, DAOs, and virtual
assets. That was a Q &A with Melissa and Carolyn
from Walker's Global, a law firm, international
law firm, by the way, that is currently servicing
DAOs. So all my friends over at ApeCoinDAO, And
Star Atlas DAO, Walker's Global is helping to
represent you. And they are also providing some
company management services in the Grand Cayman
Islands. Today is part four. So we're going to
recap a little bit how we got here. Sandow 34,
56, 57, 59. Then we would be doing a reading
of the Memo Association, the Articles Association,
the Bylaws. Look, take you into the entity search
within Cayman Islands Registry so you can see
a lot of this for yourself. And our remaining
Q &A, if there is a part five, it will be to
carry over that Q &A with the lawyers from our
friends over at Walker's Global, who was fabulous.
Take a go look at episode 59. So let's get into
this recap. All right. We're going to breeze
through this just like we did with episode 59.
So episodes 34, 56, 57, and 59 are the foundation
of what you're about to hear now. So we talked
a little bit about the relationship map, what
I thought was going on when it came to who did
what, all the entities at play. It looked a little
bit like this, and I still know that there are
some things in here that are not correct. So
if I can get time to it before the next podcast
episode, I'll correct a lot of this. I'm pretty
sure Fleet Collective is not a part in play as
much as I thought. And then there's some relationship
here stuff that has been clarified by Cyril.
And there's going to be a future Digging in the
Sand podcast episode, which will clarify a lot
of this. So, wonderful stuff. I mentioned last
episode, in episode 59, that it looked weird
at first, when we first did this in episode 34,
way back when, that it looked weird that all
of the DAL's key players were on the same street
in the same town on the island. But, but, as
we looked into episode 56, we started to understand
why that actually occurred. There are some really
good reasons why Cayman entities are providing
all of these services. It's a small island. It's
a very small island. So that business district
right there is where all this stuff happens.
So it's actually not that unusual to Cayman Island,
people who live in the Cayman Islands, which
as we learned from our guests in the last episode,
there are actually three Cayman Islands. So Grand
Cayman Islands is just the biggest one where
all this stuff happens. Did not know that. Fascinating
stuff. Hey, play a game for fun. Good to see
you in the chat. Thank you for coming. And Tom,
thank you for the congratulations. Yes, this
is episode 60. Six zero. So all of the reading
that we did through in episode 56 where we read
through the law, we actually read through all
the hundreds of pages it was. There are some
good reasons why management services, the director,
the secretary, legal counsel on management services,
you'll find them in the Grand Cayman Islands.
It's a very robust business environment. It's
tax -friendly. It views laws favorably. And also,
as we learned in the last episode, the tokens
are not seen as securities by the Grand Cayman
Islands. So there are a lot of benefits to DAOs
going to the Grand Cayman Islands. So we started
going through the REG stack. That was our Companies
Act, our Foundation's Company Law. Our Companies
Management Act, our Director's Registration and
Licensing Law, the Citation of Acts of Parliament
Law, the Virtual Asset Service Provider Act,
and the Securities Investment Business Law. All
right, that was part one. And then in part two,
we went over the case law with earnest. And then
part three, which we just did, was our professional
law from input from Walker's Global. So when
you look at all of these key words, all in the
foundation documents for the RDAO, you start
to see all of these buzzwords, right? And in
episode 56, when we did the red stack, reg stack,
we went over all of these words and you should
have a pretty good understanding if you've watched
them by now, what a subscriber is. Why did we
pay $50? What is a memo of association? What
is limited by guarantee? What is a foundation
company? Why does it need to be without any share
capital for us? All of these things became important.
And as we read through them today, you will now
understand how they all apply, which is what
today's episode is about, applying everything
we've learned. We also went through what I thought
was happening, my best guess for the creation
of the foundation company. And as we learned
in episode 59, I got a few things wrong. That's
okay. I did the best I could with what I had.
And then the experts came on in episode 59, clarified
a bit more. where the DAO selects service providers
and selects its legal advisor. That legal advisor
then provides advice. The DAO will select its
corporate services. So that's director and the
service, the secretary. The secretary is licensed
by SEMA. The director is not. Most of the time
we learned in episode 59, the director is not
licensed by the director's registration licensing
law. That would only apply under security. So
I did get that one right when I questioned it.
We reflect it here. And then the Memorandum of
Association, the Articles of Association, which
is called the Constitution, it's created. The
registrar will declare the foundation company
to be a foundation company. And it's incorporated
within the Grand Cayman Islands. All of that
means that you can become a foundation company
and start doing stuff, start dowing for us. And
there's still a question to me as to how that
plays out day to day. But we are learning that
a lot more now with Digging in the Sand podcast,
with Cyril explaining how things work, and also
with our lawyer guests, who I hope to have back
on, and we can start talking about a little bit
how these entities and responsibilities all play
together. But today we'll be answering that for
ourselves. That TLDR was in the foundation company.
That foundation company word is both the name
of the sandbox DAO and a type of company within
the Grand Cayman Islands. It's flexible in how
it's structured and operates. An exempted company
means the company that does business outside
of the Grand Cayman Islands. Limited by guarantee
means that a member of the foundation can only
lose what they put into the company. Without
any share capital means that as far as units
of ownership, no units of ownership were created
when the company, the foundation company, was
formed. Articles in Memorandum of Association
means the memo creates the foundation company,
the articles describe how it will be operated,
and the bylaws establishes internal business
rules. All three of which we will be reading
through today. Lots of business is done in the
Cayman Islands. Almost 1 ,000 companies registered
in one month alone, and there are 121 ,000 companies
that are active within the Grand Cayman Islands.
That is a lot of business being done. Foundation
roles are flexible and varied. That is why you
see a lot of resignation, stand up things, and
all the stuff we described in our last episode,
episode 59. Subscriber and secretary roles are
very important. Member, director, officer, supervisor,
manager roles all seem secondary, but that's
only to how the foundation is stood up. As we
learned in episode 59, there is a transition
from a director -led to a token holder -led.
All right, we also then in part two, that's episode
57, Sandow 57 with Ernest, who is a practicing
lawyer in the United States. We talked about
all of the current DAOs things that are happening
with Aoki DAO, BCX DAO, Lido DAO, some things
that are currently on our minds. We also went
over some opinions, some different court decisions,
how it plays into the Dapper Labs, Uniswap, Tornado
Cash, Compound DAO. Coinbase, which I just watched
another episode with Coinbase and their lawyer
talking about how the changing administration
is bringing different regulatory changes. So
check out that. Just look Coinbase lawyer podcast
and you'll see some of the ones that just was
posted. We looked over the SEC's investigative
report back in 2017. Also, its framework in April
2019. And then we talked about some important
jurisdictional things, concepts called the Long
Arm Statute, which basically means that the United
States can touch or sue a company outside of
the United States. The Conducts and Effects Test
and the Dodd -Frank Act, which pretty much reinforces
what I just said. All right. We also went over
the United States version of a foundation company
called a Dow LLC, how Tennessee, Vermont, Utah,
Wyoming all have different types. of DAO LLCs,
and particularly what you hear a lot nowadays
is the DUNA, the Centralized Unincorporated Nonprofit
Association, which we learned under the state
of Wyoming takes a nonprofit LLC approach to
DAOs, whereas an LLD, a Limited Liability Decentralized
Autonomous Organization, LLD, is in the state
of Utah. They take a more for -profit approach
to DAO LLCs. All right, we went over all of that.
And then we went into our opinion pieces that
we were looking at, one of which was the Walker's
Global. Those two authors were Melissa Lim and
Carolyn Kelly, who we just had on in our episode
59. That was part three. We went over why would
a Dow form a Cayman Islands Foundation company
in the Cayman Islands? We learned a lot of cool
stuff about separate legal personalities, it
being memberless, the shield of liability, real
world contracts that it can do things off chain.
We went over through a timeline of events that
basically went over how foundation companies
are formed. And this is according to Walker's
Global. So Walker's Global is one council that
you can choose to do it of many. And clearly
Walker's Global knows has done this a lot. An
international firm. So they went through the
whole director -led, the token -holder -led,
which I did not know. That was the most surprising
thing, is the phased approach that DAO companies
take. And then we went, what documents are required
to form a foundation company? That is the basis
of today, which is the Memorandum of Association,
the Articles of Association. We'll be talking
through all of these things here today. Episode
60, Part 4, you are now caught up. But if you
want to take a look at those episodes in depth,
56, 57, 59, and 60, and you'll see all the stuff
we learned up until today. Hey, Play Games for
Fun, how are you doing in the chat? So here's
how we're going to approach today. We're going
to take a look at all of the things that are
in Sips 1, 2, and 3. And we're going to do this
from scratch. I used to have this whole, like,
pre -prepared things. We take in all of what
we learned from the past four parts. I'm going
to do this from scratch as if I've never seen
this before. But having read and understood everything
that we have talked about up until this point.
Okay, so we're going to start with the Memorandum
of Association, which is called the Constitution.
The Article of Association, which is also part
of the Constitution. Then we're going to go through
the bylaws, which is not the Constitution. And
you'll go over why that's important that I line
that out there. The sandbox style entity search.
We'll look at the stamp dial document search.
And the regulated entities. All of which you
can publicly search for yourself. Right now.
If you really wanted to. Alright. Then we'll
go over whatever remaining questions that we
have. As we talk through all this stuff. And
then we will conclude. And talk about what's
going to happen next. Okay. Playgameforfun said.
He's doing good. Trying to create mini games.
Yep. Builders Challenge 3 is. Start it right
around the corner or start it. So please participate
if you'd like. Participate in our ecosystem.
If you are new, go check out the Game Maker and
the VoxEdit. It's free. It's in -house. And go
sign up for Magic Palette, which will make your
life so much easier when it comes to creating
your maps, creating your experiences. All right,
let's get into it. So we start first with the
Memorandum of Association. It is part of the
Constitution. The Constitution is the memo and
the articles. Well, the Sandbox Foundation and
currently the Memo Association is mentioned in
SIP number two. SIP number two is, we'll go to
our proposals here on our website, the sandbox
.website. Go under proposals, voting SIPs. If
you scroll all the way down the bottom, go to
page two. Go to SIP number two here. And you'll
see SIP number two. Was it resubmitted SIP? The
Sandbox Foundation. All right, we're not going
to spend a whole lot of time here. This is publicly
available. It can be read quite easily. So here
is SIP number two. It had a yes vote. 93 % of
the community voted yes. This SIP wanted to recognize
the role of and to approve the steps taken to
form the Sandbox Foundation as a legal entity
supporting the Sandbox DAO. There is a lot of
stuff in here that's really interesting. We will
go over the actual document itself. So the foundation
will be supported by a professional independent
director, a supervisor, a secretary, and a registered
office, legal and compliance council. Okay, so
the author of the SIP was Arasakyo. And ratify
the engagement of the law firm Travers Thorpe
Alberga TTA as legal counsel. Ratify the constitution
of the constitutional documents of the foundation.
Formally recognize the foundation as a Cayman
Island entity aligned with and supporting the
DAO. That's the wrapping of the DAO that we learned
about in episode 59. Ratify international. Corporation
Services Limited as a professional provider of
secretary and registered services to the foundation.
Ratify International Protectors and Advisors
Limited as the founder and supervisor to the
DAO. So those key words there, we're about to
learn about. Well, we already learned about,
we're about to read. Ratify the legal expenses.
Ratify the engagement of Michael Robinson as
a professional independent director of the foundation
and associated fees. So here we talk a lot of
stuff here that we're about to read through.
All right, so these are some TLDRs, but we're
going to go through this in its entirety. Cayman
Island Law requires a supervisor. We learned
about that in episode 56, I believe it was, right?
That was the one where we first went into the
reading through everything. So we learned about
it here, episode 56. the law which we learned
about in 56 over here and they engaged tta to
advise the foundation's formation there's a lot
of benefits to it and there's a risk analysis
that the found the cayman island foundation is
not a guarantee the dow members will not be found
liable for actions taken by the foundation based
on the vote of such members the reason why as
we learned was because In episode 57, we talked
to Ernest. There's a lot of unresolved case law.
And in 59, with our Cayman Islands lawyer guests,
we learned that a lot of these things have not
been fully tested yet because foundation companies
are only four, five, six years old. Okay. And
we went over a summary here. There were some
legal fees that we approved, some director services
that we approved. Metrics of success is that
the foundation is ratified. And here we go, the
appendix. The appendix is where you will find
the articles and the memorandum of association.
So we are currently talking about the memo of
association. And let's go. Let's read through
it. While I'm reading, I'm going to be adding
to this. That's going to be the whole thing.
And then we will do that until we are done. It
will take as long as it takes because this episode
I've been building up to for a long time. So
it's going to take as long as it's going to take.
Here we go. So I just clicked the link in SIP
number two. You can look at this as well. It
has a cover page, Memorandum of Association of
the Sandbox Foundation. A foundation company
limited by guarantee without any share capital.
So over in our TLDR earlier in this episode,
we went over what these words mean. Limited by
guarantee means the founders only are liable
for what it is that they guarantee. So normally
that's money or assets that they give to the
foundation company. Without any share capital
means that the founders, there are no shareholders
that have any units of ownership. Okay? Down
on the cover page is the registered office, which
we learned in Sandow 56 is required. You have
to have a registered office, and you must, in
the articles, explain where they are located.
So we did some explanations for where South Shore
Street was in Georgetown on the Grand Cayman
Islands and the building that it was in. So that
was... That was... This one here in the Grand
Cayman Islands. Right there. Harbor. Harbor Building
and Oogland Building. That's on South Church
Street. Okay. Down here in the bottom right,
you might, probably easy to miss, is, hold on
just a second. Okay. So in the top right, you'll
see the Grand Cayman Islands there. An exempted
foundation company registered and filed as number
404930 on 20 November 2023. When we get to the
entity search, you'll see just how you can use
that information to publicly search things that
are publicly available. I will show you how to
do that. An exempted company means that it is
exempted from a lot of the rules that accompany
in the Grand Cayman Islands. So any normal business
in the Grand Cayman Islands, like the local feed
store or the... Dayton Tackle Shop, whatever.
They are not an exempted foundation company.
They're not an exempted company. Whereas a foundation
company is exempted, meaning it does its business
outside of the Grand Cayman Islands. So there's
the assistant registrar, which is a required
signature in order to make this document go into
effect. And then down below, we have the authorization
code. That is an important thing if you want
to search what this document is in the public
search. So authorization code H61869906112. And
you can verify it there. The link, verify .gov
.ky. I already did that for you. I will show
you later on what that looks like. All right.
Page two of five. Memorandum of association of
the Sandbox Foundation, a foundation company
limited by guarantee without any share capital.
Okay, so it kind of repeats there. Section one,
the name of the foundation company is the Sandbox
Foundation. As we learned, the foundation is
not just a noun, it is also a verb. It describes
what type of company we have in the Grand Cayman
Islands. Section two, the foundation company
is a company within the meaning of the Companies
Act, revised, and a foundation company within
the means of the Foundations Company Act. And
again, the reason why you'll see Foundation Company
Law, Companies Law, Companies Act, Foundation
Company Act is because in one of the read -throughs
that we did in our reg stack for Sandow 56, we
learned that what used to be called law was then
revised to everything was going to be called
an act back in like 2019, 2020. So that was something
that I guess the ruling body of the Grand Cayman
Islands decided to reduce confusion. We're just
going to call everything that used to be called
a law is now called an act. Okay. The registered
office of the foundation company shall be at
the offices of Air National Corporation Standards
Limited, PO Box 472, 2nd Floor, Harbor Place,
103 South Church Street, Georgetown, Grand Caymans,
KY1 -1106, in the Grand Caymans, or at such other
place as the directors may from time to time
decide. So there's your exemption right there.
Where are the Grand Cayman Islands? We have a
foundation company that's exempted under them,
but we're allowed to do business anywhere in
the world. So that was down here in the bottom
right, that screen here we're looking at. This
is where the buildings are. If you do a Google
Maps street view and look up Harbor Place 103
South Shore Street, there it is. And look at
Sandow 56. for the revelation and the breakdown
of that. Okay. So section three, the objects
for which the foundation company is established
are section A, subsection A, to independently
support, educate, and encourage the use and adoption
of the sandbox ecosystem and related infrastructure
and digital assets to include sand, land, and
other NFTs. Okay. We established in episode 59
with our guest lawyers that if you may or may
not be applicable to the Virtual Asset Service
Providers Act, we don't believe we are. However,
we would need our lawyers, who is TTA, Trevors,
Thorpe, and Alberga, to advise us, our foundation
company, whether or not we are. I have not heard
from them. I have not asked them that question.
So I do not know what their advice is to our
DAO admin team. But I'll probably ask that sometime
in the future. Maybe that's one of my Q &As.
Hey, how about that? That's the whole point of
this thing. All right. So what is the question?
On page two. All right. And I'm down here. So
this. So on page two. Section 3A, we want to
know, does the VASP, which is a Virtual Asset
Service Provider Act, apply to the Sandbox DAO
Foundation? All right. And we want to reference
the digital assets word. Okay. So there you go.
There is one question already. Back to our memo.
So subsection B under paragraph or section three,
to act as a holding company and investment company
with no restrictions on the obligations, excuse
me, on the objects or operations of its subsidiaries
or on the nature of its or their investments.
So we learned in episode 59 from our Cayman Islands
lawyers guess that. In order to ensure that,
sometimes to ensure that it remains compliant,
Cayman Island law and that the Security Investment
Business Act or the Virtual Asset Service Provider
Act does not become applicable because that increases
your registration requirements from your director.
So right now we are most likely not, we do not
have a registered director under the Director's
Registration Licensing Act. Let's make that another
question. Is our director a licensed director
under the DIRLL? The director's... Let's look
at our registration, our reg stack. What was
that again? Our director's registration and licensing
law. So it's the DIRLL. Excuse me. And there
are three types of directors. We learned that
in Sandow 56. independent corporate and i can't
remember the third right now but is our director
licenses under the drll that is uh that brings
into a whole lot of new stuff so where i'm seeing
some keywords here is a holding company an investment
company so does the security investment business
act siba does that apply we learned about that
more in 56 and also 59 when our Cayman Island
lawyer guests went over those things and how
it could be applicable. But we would need our
legal counsel that we pay as a SanFam, the TTA,
we would need them to advise us. Are they? Are
we? So we want to know. And this is again, page
two, section three. This is section B, section
three B. Again, section three B is. Does the
CIBA, Security Investment Business Act, apply
to the Sandbox DAO Foundation? We would like
to know that. Is our director a licensed director
under DRLL? Okay. So those are already four questions
we have we'd like to ask. All right. Section
3C. The objects for which the foundation company
is established are to provide financial assistance
or benefits to beneficiaries designated under
the Articles of Association. So one thing I was
curious about from Sandow56 is, who are the beneficiaries?
Is our DAO, our voting DAO, our SanFam, are they
the beneficiaries? Who would that be? Is it SanFam?
All right. So again, you can see down here in
the bottom, bottom middle, I am updating these
questions as we go along. So we will stop. Okay,
so that's section 3C. So now let's go to section
3D, as in Delta. To do all such things as in
the opinions of the directors are or may be incidental
or conducive. to the above objects or any of
them. So it basically frees the director to act
in any way they see fit under Sections 3A through
C, Alpha through Charlie. Okay? Okay, so that
is Section 3 of the memo. Section 4. The foundation
company shall have and be capable of exercising
all the functions of a natural person of full
capacity. irrespective of any question or corporate
benefit, as provided by Section 27 .2 of the
Companies Act. And without prejudice to the foregoing
generality, the foundation company has the following
powers, which may be exercised only in promoting
the objects for which the foundation company
is established. So basically what this is saying
is, is that Section 4 and all of these things
we're about to go over promotes Section 3A through
D, which we just read. All right, so section
4 is expanding on section 3A. And only those
who have full capacity, which having read this
and the articles, they have a definition for
what that full capacity means. Okay, so section
4A. The following powers which may be exercised
is to promote or carry out research. Section
4B. to employ paid or unpaid agents, staff, or
advisors. Section 4C, to provide advice. Section
4D, to publish or distribute information. Section
4E, to cooperate with other bodies. Section 4F,
to support, donate to, administer, or set up
charities or not -for -profit organizations.
Section 4G, to raise funds, but not by means
of taxable trading. Section 4H, to borrow money
and give security for loans. Section 4H, to acquire
or hire property of any kind. Section 4J, to
let or dispose of property of any kind. Section
4K, to make grants or loans of money and to give
guarantees. Section 4L, to promote, incorporate,
acquire, manage, control. and operate for commercial
gain one or more subsidiary companies in any
jurisdiction of the world and to exercise all
powers necessary with respect to the ownership
of such subsidiary companies. We learned in episode
59 with our lawyer guests that such subsidiaries
may be a British version island subsidiary that
is for profit. And to do things that would, such
as securities or virtual asset things that...
So that they can remain compliant with the Grand
Cayman Islands law to where if you do engage
in securities activities or virtual asset activities,
you are subject to increased loss. All right,
that was our reg stack that we went over. All
right, it looked a little bit like this down
here. That was our reg stack. So if you did virtual
asset things or security investment things, you
became subject to these acts. We went over that
in Sandow episode 57 in depth and detail. So
our lawyers from episode 59, I say our lawyers,
the lawyer guests from Walker's Global in episode
59, they articulated that in order to remain
compliant to where you do not have to be subject
to these things, you would create a subsidiary,
which is a separate legal personality. And you
can then incorporate it anywhere else in the
world. And what we're learning now as we read
through our memorandum of association, that the
powers invested in the foundation company is
that they may promote, incorporate, acquire,
manage, control, and operate for commercial gain
one or more subsidiary companies in any jurisdiction
in the world. So we freed ourselves to do that.
The foundation company. has freed itself to do
that. Section 4M, to set aside funds for special
purposes or as reserves against future expenditure.
Section 4N, to deposit or invest funds in any
manner. And Section 4O, as an Oscar, to do anything
else within Cayman Islands law and regulation
which promotes or may help to promote the objects.
which the foundation company has established.
So basically it's reiterated itself. Section,
and again, that section four is an extrapolation,
an expansion, an increase of section three. Section
three established why the foundation company
exists. What is it here to do? Section four gives
powers to expand on section three. All right,
so section five. The foundation company may not
carry on a business for which a license is required
under the laws of the Cayman Islands unless duly
licensed. That is why it is, we learned in episode
56, standout 56, why it is an exempted company.
Okay. Don't. Second, I will pull that in here.
Oh, you know what? I have that already up. So
that was episode 34. Here's episode 56. And in
episode 56, we talked about, not that, it was
here. Under the, specifically under the general
registry, we talked about types of companies.
Here we go. The visual overview that we went
over in episode 56, how it was a company. That
was exempt, which made a foundation. And we chose
foundation company, which made the Companies
Act, Limited Liabilities Companies Act, the Foundation
Company Law. Those all became, we became subject
to them. And also we learned that under a limited,
our liability of shareholders, which is under
the types of company that registers, company
register, types of companies. And then you click
liability shareholders. We learned that. The
liability of shareholders and members is limited
by guarantee without share capital. And that
was when we just read the memo of association.
So we're reading that now where we under page
five, which is what we just read, limited by
guarantee without any share capital. So full
circle. Here we are actually reading page five.
where it says what it is we can and cannot do.
So how cool is that? How cool is that? Just in
case we have to go back to it. Okay, we'll go
back to it here if we have to. All right, let's
get back to our reading of the memo of association.
So that was section five. Section six, no portion
of the income or property of the foundation company
from whatever place or source shall be paid or
transferred directly or indirectly by way of
dividend, bonus, or otherwise, however, howsoever,
by way of profit to the members, proposed members,
directors, or supervisors of the foundation company
as such, apart from authorized remuneration for
services to the foundation company. All right,
what in the world does that say? Let's break
that down. No portion of the income or property
of the foundation company. Okay, so it's saying
that whatever income or property the foundation
has, none of it shall be paid or transferred
directly to the members, proposed members, directors,
or supervisors of the foundation company, except
as authorized remuneration. Remuneration means
compensation, you know, paid. than being paid.
So this is saying that nothing in the foundation
company can be directly or indirectly transferred
to the proposed members, directors, or supervisors.
So this is protecting the DAOs assets right here.
So all of the, whatever custody it has of wallets,
so let's say all the millions of sand or lands,
perhaps maybe the lands that we delegated to
the director. That's a great question. Let's
ask that question. So we're in section six, which
is page three. Page three. Are we really? Yeah,
page three of five. Okay. So in section six,
is this protecting the DAOs assets? So that would
be land and sand and its new collection, the
NFT collection that we're getting from. TSB,
eminently, or maybe we already have it, from
being given or gifted to foundation staff. Let's
call them staff. Foundation, yeah, staff. All
right, we think that's exactly what this is saying,
that no portion of the income or property of
that foundation company shall be paid. or transferred
to members, proposed members, directors, or supervisors
of the company, except what is authorized as
part of their salary. That's what I think this
is saying. So we would want to ask our lawyers,
TTA, and the DAO admin team, is that true? Because
that's a good thing to protect the DAO right
there. They can't just give themselves 2 ,000
lands. They can't just give themselves all the
Bored Apes and the Mutant Apes that they were
about to get as a gift, an endowment from the
Sandbox Game Company. Right? They can't just
be given away. All right. That's good. That's
good protection. Section 7 of the memo. The liability
of the members is limited. We already understand
what that means. Section 8. The Foundation Company
may cease to have members. I did not know what
this meant. Until episode 59. All right, so our
Melissa and Carolyn, when they came on just the
other day, explained in their brief that a company
can be memberless. Where'd it go? Where is the
word memberless? Memberless. All right, here.
Why would a Dow form a Cayman Foundation company?
A foundation company fits within the decentralized
ethos as it can be memberless. When I asked them
what did that mean, they meant stakeholders.
There are no stakeholders, which when we talked
about this in episode 56, if you have shareholders,
you have a fiduciary responsibility to maximize
shareholder value, which is profit. So this removed
the profit. motive from the Dow? And you know
what? I want to make sure that's an answerable
question. So on page three, section six, wait,
is it section six or is it section eight? Excuse
me, section eight. Does this relate to the memberless
part that removes the profit? incentive, the
profit, not incentive, responsibility, the profit
incentive, there we go, for maximization of shareholder
value consistent with fiduciary duties of the
director, right? So that is a very fascinating
question. I really want to know the answer to
that one. So this whole does the foundation,
the foundation may cease to have members, which
we learned in episode 59, that there is a, when
you first stand up a company and foundation under
advisement by walkers. So we are under advisement
by TTA. We may be to have done it. We may have
done it different, but Walker said they do it
by standing up a company, which is director led,
right? And it has no one else director led. The
subscriber immediately resigns. So it makes it
basically leaderless. But then it's director
-led to where only the director has the power
to do everything. Then they transition and modify
all the documents to be a token holder -led.
And that's where the DAO comes into play, the
actual DAO governance, us, the DAO admin team.
So here it says the foundation company may cease
to have members in Section 8. So does this relate
to that memberless thing where memberless would
mean? stakeholders or shareholders and the fiduciary
responsibility to maximize shareholder value.
So is that what that means here? We'd want to
ask our lawyers, TTA. Okay, section nine. Each
member who is a member, I'm sorry, each person
who is a member undertakes to contribute the
assets of the foundation company in the event
of the foundation company being wound up during
the time that the person is a member. or within
one year afterwards, for payment of the debts
and liabilities of the foundation company contracted
before the time at which the person ceases to
be a member, and the cost, charges, and expenses
of the winding up of the foundation company,
and for the adjustments of the rights of the
contributories among themselves, such amounts
as may be required, not exceeding the sum of
one United States dollar. All right, that was
a mouthful. So what does that mean? Each person
who is a member undertakes to contribute to the
assets of the foundation company. All right.
So that means people who become a member, they
contribute things to this foundation company
of ours. And in the event of the foundation company
being wound up, meaning created, that's what
this memo does. It creates the foundation company
during the time that the person is a member.
So when... When the person who is the member
contributes assets to the foundation company
or within one year after that for payments of
the debts and liabilities of the company, the
foundation company contracted before the time.
All right. So this is saying that the person
who gives stuff to the foundation company when
it's created is responsible. for the debts and
liabilities of the foundation company for up
to one year. And we learned all about this in
episode 56. There was a part where we talked
about the whole one year afterwards. Actually,
let's go right here. One year. Oops, that's not
it. There it is. Section 49 of the Companies
Act. The liability of past and present members
of the company. All right, we learned that. If
a company is wound up, every member is required
to contribute to the assets to satisfy the debts
and past members who are active up to one year
prior. For companies limited by guarantee, no
member is required to pay more than what the
memo of association cites as guarantee. And guess
what we just cited is we are requiring that they
spend, that they are not required to spend any
more than $1. All right, so that's how we protect.
It looks like that's how we're protecting our
founding members who resign immediately, most
likely. We'll find out when we ask the question.
Most likely resigned, right? So those members
who stood the company up and gave it its starting
assets. Some of them may have resigned, but up
to one year after per Cayman Island law, they're
required to pay debts and liabilities. Okay?
But because we're an exempted company, we are
saying that they will not pay more than $1. All
right. So that's a way for us to protect ourselves.
That's Section 9. Section 10. If on the winding
up, which also means liquidation or dissolution,
of the foundation company that remains surplus
assets after the satisfaction of its debts and
liabilities, the same shall be applied or distributed
under the articles of association of the foundation
company and subject here to shall be paid or
transferred to such charitable objects as shall
be decided by ordinary resolution of the foundation
company. We'll get into ordinary resolutions
within when we do the articles of association.
For now. All we really need to take from this
is that if this company is dissolved, if it is
wound up, then we shall donate these remaining
assets to charitable charities or apply to distribute
it under the Articles of Association. So we'll
read what that means later. Of course, that's
Section 10. Almost through. We're almost through
our five pages. Section 11. This memorandum and
the articles of association may be altered by
the founder, by notice to the foundation company,
or by special resolution of the foundation company,
except that none of clauses 6, 10, or 11 of this
memorandum may be altered and no other alteration
may be made, which is in any way inconsistent
with clauses 6, 10, or 11. All right, so what
is clauses 6, 10, and 11? Clause 6 is no portion
of the income. So that's where people can't just
donate stuff to themselves. So the director may
not gift himself 10 board ape yacht clubs, 10
apes that we're about to get from the sandbox
game company, right? So the supervisor may not
give itself 100 ,000 sand. Okay, so... Section
11 here is saying that no adjustment may be made
to that. All right, so what does section 10 say?
If there are any surplus assets, if the company
is dissolved, the remaining assets shall be applied
or distributed in a way consistent with the article
of association or donated to charity. Okay, so
more protections here. And then clause 11 is
this clause. So this clause is saying it cannot
be modified. So it is enshrining unalterable
rights and rules that no one can change. And
as far as we can tell, these three changes, these
three clauses or sections are protections to
stop someone from becoming a, from giving themselves
all the assets, basically rugging. So it's basically
a way to stop rugging from happening. Okay, that
was section 11. All right, and then we go to
page five, which we're starting to be done here.
We, the subscriber of this memo of association,
wish to form a foundation company limited by
guarantee without any share capital and registered
as an exempted company in each case pursuant
to this memo of association. And we agree that
we shall, upon the demands, being made by the
foundation company, paid to the foundation company
an amount equal to the amount of the guarantee
agreed to be made by each member of the foundation
company in accordance with paragraph 9 of this
memorandum of association. So that's basically
a rehash of what we just read in the five pages.
So we're going to form a foundation company.
It is limited to the amount that people give
in section... Nine. And if the company is dissolved,
the people who have given those resources are
only required to pay up to $1. The rest is paid
for by what is in the DAO. And then whatever
is left over gets sent to charity or as applied
or distributed and consistent with the article
association. Okay? That is what this paragraph
says. All right, that's dated 20 November, 2023.
The name of the company that signed this, that
stood this company up, International Corporation
Services Limited. Its address and description
is Harbor Place, second floor, 103 South Church
Street, P .O. Box 472, Grand Cayman. And the
zip code is KY1 -1106. It was authorized by this
person. And it was witnessed by this person.
Okay. We had just read through and concluded
memorandum of association. That was some cool
stuff. That was some very cool stuff. So what
are our questions? Let's get to our questions.
Our questions were on page two, section three,
a does the virtual asset service provider act
apply to the sandbox style foundation? Our next
question was, is our director a licensed director
under the director's registration and licensing
law? I don't think so. I don't think that's true.
I don't think they are. But it's good to ask.
Section 3B, does the securities investment business...
Business? Yeah, okay. For some reason, that just
read wrong to me. Question number four. Under
section 3B, does the Security Investment Business
Act apply to the Sandbox DAO Foundation? Question
five. Section 3C. Who are the beneficiaries?
Is it SanFam? Are we? Someone else? Question
six. Page three, section six. Is this protecting
the DAO's assets, which is the land, sand, and
NFT collection that's about to be given to us
from the Sandbox? Yeah. Is it protecting the
DAO's assets from being given or gifted to Foundation
staff? Let's call it, not needlessly, but unreasonably.
Right? Because the one thing that they can give
themselves is a salary, is compensation for their
services. So, unreasonable. Right? Let's say,
unreasonably gifted. Okay? And then our seventh
question, page three, section eight. Does this
relate to the memberless part that removes the
profit incentive for the maximization of shareholder
value, which is not consistent, required by fiduciary
duty? So let's read that again. Does this relate
to the memberless part that removes the profit
incentive for maximization of shareholder value
required? By fiduciary duty of the director.
Okay? That was our memorandum of association.
How about that? This is going very well. I'm
so glad that we waited to read through this after
reading the law in episode 56. After discussing
the case law. with a practicing U .S. attorney
in episode 57, after discussing Cayman Islands
Foundation Company particulars with Melissa and
Carolyn from Walkers Global, a law firm in the
Cayman Islands, in episode 59. And now we're
in episode four, reading through the actual stuff.
It makes so much more sense now. It makes so
much more sense. This is cool. This is cool stuff.
This is how your DAO is being run. All right?
So... When everyone thinks that there's a cabal
going or that it's really shady, what's going
on, it's not once you read through all this.
Once you read through all this, it makes sense.
It's starting to make a lot of sense. So that
was our analysis of the memo of association.
All right, next up, we're going to be doing the
articles of association. I'm going to take a
quick break and you should too. I will see you
in five minutes. So let's set a five minute countdown.
And then we will return. See you in five minutes.
and we're back. Take a look at the chat. Play
game for fun. Dr. Metaverso, Tom Voxel, Jazz
Wolf, Yuma. Hey, Yuma. King Charles. Thank you
all for being here. Thank you for listening,
whether you're lurking or not. We just went over
the memo of association. Looked a little bit
like this. There were 11 sections in all, and
it basically told you how it was created and
what it was created for. How it gave high -level
limitations that you shall not cross, like gifting
yourself a bunch of bored apes or 100 ,000 sand
unreasonably. So a really good document. Now...
We're going to get into the articles of association,
which is still part of the Constitution. All
right, so articles plus memo equal the Constitution.
Not to be confused with the Constitution that
SIP 3 calls the bylaws. Not to be confused with
that. So that's not the Constitution we're talking
about. We're talking about the Constitution as
described in Grand Cayman Island law, right?
So for us, our Articles of Association are also
located in SIP number two. So here is SIP number
two. You scroll all the way down to the bottom.
You'll see Articles of Association. So we're
going to go ahead and click that. And here it
is. So we're going to zoom in. And just like
we did for our memorandum of association, we're
going to be recording our questions as we go.
One second while I take a drink. This one's going
to be a little bit longer. It's actually 19 pages.
And here we go. So the very first thing you notice
that's different is on the top left, there's
that duty stamp. Now, as we learned in 56, actually,
you can look at this stuff now. Let's go. In
56, we had the fees, right? There was a fee schedule.
And it actually listed 50 as the fee. What was
that? No, no, no. There it is. Companies Act,
page 30 through 35 in section 26 under registration.
The registrar shall make available stuff. The
required particulars are 50 bucks. Where else
was that? It was in another, there's a fee schedule.
It's one of the amendments. Excuse me, the exhibits.
So in that, we paid a $50 duty stamp. Okay, so
that's why you see that there. Now, is that number
the same as the other number? It should be. 404930
is our registration number. And it is. Same date,
same stamp. Great. Articles of Association of
Sandbox Foundation, a foundation company limited
by guarantee without any share capital. So we
already went over that. Same stuff. There's our
registered office. Same thing as what we went
over. It's 103 South Church Street, and it's
by International Corporation Services Limited
on the Grand Cayman Islands in Georgetown. Page
two, Articles of Association of the Sandbox Foundation,
a foundation company limited by guarantee. Section
one, Interpretation. What you all may have seen
in episode 56 is I love the definitions part.
The definition thing will tell you so much of
something before you even read it. All right,
so here we have definitions in Section 1. Section
1 .1, in these articles, unless the context requires
otherwise, founder, oh, that's right, we had
a question I forgot to ask. Let's update our
questions, my bad. I don't know if y 'all noticed,
but in Section 11 of the memo, the very first
sentence read, this memo in the articles. of
association may be altered by the founder do
you all remember seeing that word before no we've
never seen that word before that's the first
time we've seen that word so let's go back to
our questions page 4 section 11 of our memo what
is the role of the founder i have a feeling that
part of that question will be answered here in
the articles but You know, that's not the real
question I want to ask. Why is the founder role
only mentioned here? It seems like a minor role,
I guess. Minor role, or it just seems like it's
not really clear what the role does. It's not
clear who this is. Who or what this is? All right,
great. That's a good question. We need to ask
that. All right, let's go back to our articles
of association. So in these articles, unless
the context requires section 1 .1, founder means
the founder named in these articles. Laws means
the Foundation Companies Act revised. The Companies
Act revised. as applicable to the foundation
companies and every statutory modification or
reenactment of them. So the reason why I think
they put revised here is because they're not
just putting themselves to one revision. So the
ones that we did in episode 56, the latest versions
were 2003 revised Companies Act, 2003 revised.
2024. All right. And then we had the foundation's
company law of 2019, 2017, 2019 revised 2024.
So when they say revised here, when, when 2015,
I'm sorry, when 2025 version comes out, then
it will automatically be inducted is what, is
what I read here. In fact, let's make that our
first question. It's a, it's kind of like a,
it's not a big deal of a question, but just because
I really want to know at this point. So that's
our first question there. All right, so page
two, section one, one. Does the mention of revised
mean that it always references the latest revision
of Foundations Company Act and the Companies
Act? So Companies Act of 2023, Foundations Company
Law. foundation company act of i think 2019 let's
take a look foundation company law so fcl right
so fcl of what uh that's what 2019 oops you cut
you all can't see what i'm doing here we go it's
2019 no is it 2017? Yes, 2017 revised, oh, 2023,
excuse me. So there wasn't a 2024 revision yet,
except for CMA, which was the Companies Management
Act. That was revision 2024. So this is a great
example of that. I was reading from, and I did
my whole analysis on the Companies Act of 2023
revised 2023 and the Foundation's company law.
also known as the Foundations Company Act of
2017, revised 2023. So does this revised thing
here mean that it will always incorporate the
latest revision? So if 2025 comes out, does it
automatically induct it? I think that's what
that means here. This is a nerd question. I want
to know. Means the Foundation Company Act revised
and the Companies Act revised as applicable to
foundation companies and every statutory modification.
or reenactment of them. Maybe that's what that
last part means, every statutory modification.
I think modification might refer to revision,
but we'll ask. That's why we have legal advice,
is to clarify these sorts of things. Next, here
we go. Ordinary resolution means a resolution
passed at a general meeting of the foundation
company by a simple majority of the votes cast
or by a written resolution in writing under Article
9 .7. We won't read through it all right now,
but let's look at Article 9 .7. 9 .7 is resolution
in writing. Okay, so we're going to talk about
resolutions toward the end. Actually, you know
what? Let's read that because it's mentioned
twice here. So this was the definition of ordinary
resolution by a written resolution in writing
under Article 9 .7. So let's look at 9 .7. A
resolution in writing signed by all persons for
the time being entitled to vote. at general meetings
shall be as valid and effective as if the same
had been passed at a general meeting of the foundation
company duly convened and held. Okay. Okay, so
this basically means that a resolution, if you
write a resolution, maybe by email or by Discord,
has the same effect as them being passed at a
general meeting in person or on Zoom or whatever.
Cool. All right, so that was ordinary resolution
under Section 1 .1. Special resolution. Oh, let's
go back to ordinary resolution. So that means
50, greater than 50%. So like 50 .1 or 51 % of
the vote is simple majority. Special resolution
means a resolution passed at a general meeting
of the foundation company by not less than a
two -thirds majority of votes cast or by a resolution
in writing. Under Article 9 .7. So this requires
two -thirds majority. Same thing. And it references
the same Article 9 .7. Section 9 .7. The word
written and in writing include all modes of representing
or reproducing words in visible form. So that
could be Discord. That could be Discourse or
Forums. That could be Reddit even, I guess. It
could be whatever it is you want where the words
are reproduced in written form. visible form
and then section 1 .2 except as provided above
the words and expressions defined or used in
the laws have been have the same meaning as in
these articles okay okay so they're saying all
the stuff that we went over in section section
and and this one podcast 56 all of these rules
and definitions had the same effect right there's
the same meaning in these articles. Okay. Section
2. Preliminary. Section 2 .1. Business of the
foundation company may be commenced immediately
upon registration under the laws. Foundation
company's general nature of business is holding
company securities. And, unless otherwise resolved
by the directors, its financial year end is 31
December. Okay. This is a great... Reason why
I read it from scratch again. Because I overlooked
this the first time I read it. I didn't fully
understand because I didn't do episode 56 yet
where I read through the law in its entirety.
Having read through the law, I am now wondering
about... I am now wondering about this. That
right there. That sentence. Let's make that a
question. Page two. Section 2 .1. Please explain
the nature of the sentence. I'm going to word
this very carefully so that it is explained very
carefully because of current regulatory environments,
all sorts of wise reasons why. Please explain
the nature of the sentence. The foundation company's
general nature of business is holding company
securities. And we already asked in one of our
questions, does the Securities Investment Business
Act apply? Okay, so now we definitely want to
know because that sentence makes it seem like
it might. Whereas in my original assessment,
I didn't think it did. But, all right, now we're
going to say C, question, C, question four. And
we ended with question eight. So this is going
to be question nine. See question four, right?
I'm going to put that one in, in blue. Actually,
you know what we're going to do? We're going
to take a page from what we've been doing before.
We're going to highlight some key words. Okay.
So this is what we were doing in our reading
and it was very helpful. Okay. So BASP. I remember
when we were going over this, and when I was
reading through everything in Sandow 56, I made
special words, keywords blue, so that we could
keep track of stuff in a sentence. That became
hugely helpful later on. All right, so I highlight
them in green, and then the blue was what the
key parts were. So we're going to do that. We're
going to highlight them in green so that we can
keep track of everything. That's what we're going
to do. Let's start first with our questions.
So articles. So VASP is one. All right. Foundation.
Thou Foundation. That's two. What's next? Director.
was one. DRLL was another. The Director's Registration
and Licensing Law. CIBA, Securities Investment
Business Act, is one. TSP DAO Foundation is another.
And who are the beneficiaries? So SanFam was
one, and beneficiaries was another word. So this
helps kind of clear away the cobwebs later on.
All right, and then what's our next part of questions?
Dow assets, so land, sand, NFT collection. That
could be one. Let's do assets, though. So the
Dow's assets. Foundation staff. Cool. Next one
was memberless. Profit incentive shareholders.
Right, so required by fiduciary duty. So this
is the... Here, we're going to make this blue
because this is the heart of the question. And
the director is a key phrase, keyword. Founder
is another keyword. And here we go. There we
are. You know what? Let's do this. Be consistent.
All right. Now we are on our questions for articles.
Okay. So the bylaws. Here are the laws. The Foundations
Company Act and the Companies Act of 2017 and
2003, respectively. Please explain the nature.
So there's foundation company. That's another
keyword. And securities. Is that a keyword? That's
going to be a key phrase, so we're going to make
that blue. We need to know the answer to that
one. Or at least we're going to ask and see if
it can be answered. There's that. All right,
let's return back to our articles. The foundation
company... Okay, this is section 2 .1. I'm going
to read it again. Business of the foundation
company may be commenced immediately upon registration
under the laws. The foundation company's general
nature of business... is holding company securities,
and unless otherwise resolved by the directors,
its financial year end is 31 December. Section
2 .2. The foundation company may ratify any contract
or other transaction entered into its name or
on its behalf prior to registration. Section
2 .3. The preliminary expenses of incorporating
the foundation company shall be paid by the foundation
company, including any expenses concerning any
contract or transaction ratified under Article
2 .2. All right, what was 2 .2? The foundation
company may ratify any contract or other transaction
entered into its name on or behalf prior to registration.
So in 2 .3 here, where we just talked about the
preliminary expenses, remember that it comes
from the guaranteed amount from the original
members. That's limited. I guarantee. And also,
if those people are called upon to pay the debts
as is required by the Companies Act, then per
the exempted rules, the memo of association determined
that that repayment would be $1, maximum of $1,
meaning that whatever is in the foundation company's
assets book is the maximum that they can pay,
plus $1 of the original members. Pretty smart
move. Seems like a good way to protect our people.
Okay. Now, section three, the founder. All right.
The founder. We learned in episode 56 that the
founder was only mentioned in the template of
the foundation's company law. And we were very
puzzled by that. I was very puzzled by that.
Why was that the case? Why is the founder only
mentioned in... the template, which is optional,
and a foundation company law. Didn't make any
sense to me. So I really want to know that. Didn't
get a chance to ask our Cayman Island lawyer
guests in episode 59. If I'm able to get them
back on for Q &A, perhaps I will ask them that.
Why is it there? Why is it only there? But here
in our articles association in section three,
we have where we're going to find the founder.
So section three one. The founder is International
Protectors and Advisors Limited of Harbor Place,
2nd Floor, 103 South Church Street, P .O. Box
472, Georgetown, Grand Cayman, K1 -106, 1106
Grand Cayman Islands. Okay, so the founder is
IP &A. Now, if we recall IP &A, I should have
been the one. Nope. Let's go back to SIP2 because
I believe that's where we mentioned it. IP &A.
There we go. Cayman Island law requires for all
foundation companies, as well as the company's
secretary and other services, IP &A is the founder
of the foundation. The foundation has engaged
IMPA to serve as supervisor. Okay. So IP &A,
I believe, is Michael Robinson's company. I think.
I'm pretty sure it is. I thought I remember seeing
that somewhere. Maybe it's in the entity search
that I have later. So let's, let's make that
a question. Okay. So our question is page three,
section 3 .1. Is I P and a, so, uh, per sip to,
no, um, Is IP &A the company led by Michael Robinson,
which is the director? So is it all the same?
All the same people there? It's not a bad thing.
Just need to know. It'd be nice to know that.
All right. So IP &A is a key phrase. They're
a key person. And that Michael Robinson is as
well, as is the director's position. All good
things to know. All right. Next up. Section 3
.2. The founder has the following powers, each
of which is described in more detail elsewhere
in these articles. Okay. Section 3 .2a. The founder
has the power to authorize the admission of members
or to restrict or prohibit the admission of members.
See Article 4. Article 4 is the members, okay?
Section 3 .2b, the power to appoint or remove
directors. See Article 5. Okay. So the founder
is already proven to be... So Article 5 is directors
and officers. These are some key positions. Fascinating.
Who is the founder? Because this person already
has an enormous amount of power. Section 3 .2c,
the power to call for reports, accounts, information,
and explanations from the directors. See articles
5 and 13. So article 5 is directors and officers.
Article 6, I'm sorry, article 13. Let's keep
on going all the way down. Is accounts. Okay.
Section 3 .2D. Power to appoint or remove supervisors
and to settle their powers and duties. See article
6. I have a feeling article 6 is going to be
supervisors. It is. Okay. Section 3 .2E, the
power to designate beneficiaries, give directions
as to their benefits, grant them enforceable
rights, and to revoke or vary the same. See Article
7. Big bet that that's the beneficiaries. Article
7. Yep. And because I know Article 8 is mentioned
below it, Article 8 is secretary. All right,
so Section 3 .2F, the right to receive notice
of and attend and to vote at general meetings
of the foundation company. Okay, let's look at
what Article 9 is. Article 9 is general meetings.
Section 3 .2G, the power to cause the foundation
company to be wound up. Oh, my gosh. Wound up
is liquidated. The founder has the power. To
liquidate the company. To close it all down.
All right. Section 3 .2H. The power to adopt,
revoke, or vary bylaws. See article 17. So let's
look at 15. Look at that. Winding up. It's going
to be fascinating. And article 17. Bylaws. Okay.
And remember. We learned in episodes 56 and 59,
bylaws are optional. They are not required. And
people who do business with a foundation company
are not required to adhere to a foundation company's
bylaws or consider it. Okay. And then section
3 .2i, the power to adopt, provoke, or vary the
memo of association and these articles. Let's
see article 18. Alteration of memos and articles.
Section slash article 18. Okay, holy smokes.
So here in section 3 .2, the founder has the
following powers. It seems like they have every
power. The founder can almost do anything, it
looks like. They can authorize and revoke members,
directors, supervisors. They are allowed to call
people to give reports. They're able to dissolve
the company, to close it down. They're able to
change the bylaws. They're able to change the
memo and the articles of association that we're
reading right now. This is like everything. So
who is the founder? The founder is International
Protectors and Advisors Limited. Who are they?
When we do an entity search, you will see. What
I don't think I found when I did the free search,
online free search, was who led it. I don't know.
We'll have to check. That right there is an enormously
powerful position. So let's do this. Page three.
Section 3 .1. Oh, I already did that. Is IPNA
the company led by, or is the company IPNA led
by Michael Brown's director? If not, who is?
All right, so who is the company owner? That
is the key to Sandbox Style Foundation, apparently.
That founder position. Okay, let's keep going.
Section 3 -3. the founder's powers are free of
any duty and may be exercised for the founder's
own benefit. I don't know what that means. Free
of any duty. Does that mean duty of, like fiduciary
duty? Let's ask. Does free of any duty mean fiduciary
duty? Duty? What else? And maybe exercise for
the founder's own benefit. Okay, second question.
Remember how we just read in our memo of association?
Section 9. We just had this great... No, not
that one. Where's the one about the remuneration?
There. Section 6. How people can't just give
themselves stuff if they want to. Does this mean
that... Page three, section three, three of the
articles association that where it says maybe
exercise for the founders own benefit. Do they
get to disregard that? Own benefit. Mean they
get to disregard. The memorandum of association.
Page. Whatever section nine. What is it? Page
three, section nine. Here we go. Super, super
curious. That doesn't mean anything's going bad
here. It just means that the founder, who is
an optional role, has been given very, very big
power. A lot of power. Okay. So what else have
we got? This is a key phrase. So we're going
to make this one blue. And founder is a role,
a keyword. So we're going to make that. So we're
going to make that highlighted. And then MOA,
page 3, section 9. Also. Okay. Let's go back
now. Section 3 -4. The founder may, by notice
of the foundation company, irrevocably or irrevocably
terminate or restrict any or all of the founder's
powers. If the termination or restriction is
expressed to be irrevocable, It may not be altered
or revoked directly or through an alteration
of these articles. I'm seeing a little bit of
a contradiction here. I don't know. I'm not a
lawyer, so I'm not sure. But let's go page 4,
section 3 .4. Is there a contradiction here?
The founder may irrevocably... revoke his, her
own powers, but has the power to, has a power
in section 3 .3 to, what was the, no, section
3 .2 to, where was it? Receive notice. Section
here, I, the power to adopt, provoke, or vary.
So they can change it however they like. So if
they irrevocably revoke their powers, can they
overrule their own revoking of the powers? Or
because they revoke the powers, they're now kicked
out and they don't get a chance to go back in?
I don't know. Under section 3 .2i. To change
MOA. Do they get to change the articles? Wait
a minute. It just says articles. Oh, and these
articles, yeah. And AOA. However they want. So
it's key phrases. Key word is founder. MOA and
AOA are also keywords. And then, yep, there we
go. All right, so that's a question. It does
say at the very end here, directly or through
an alteration of the article, so maybe the answer
here is no, but the fact that the founder has
the power to change itself whenever it wants,
it sounds like. I mean, can it change the words,
the other section saying that it can't change
the words? I don't know which one wins out there.
We would need lawyer support. Okay. Section 3
.5. The founder's powers are not assignable,
meaning they can't be transferred to someone
else, and, except as permitted by these articles
or required by law, may not be exercised by any
other person on behalf of the founder. Okay?
So the founder may not designate someone else
to have the powers, which, as we learned, are
like God powers. This is the God mode right here.
The founder. Okay? Section 3 .5, the founder's
powers are not assignable. And we just read that
in our mind. Section 3 .6, upon the founder's
winding up in dissolution, the founder's powers
shall terminate. See, this is why I'm saying,
okay, we need to add this to the question. So
it's not just section 3 .2i, it's also section
3 .6, which says the founder's powers terminate.
when the company gets dissolved. But here it
says that it could be irrevocably terminated.
I don't know. This seems like a contradiction
going on here. So I'd like to know. It says it
only terminates upon winding up. Okay, so we'll
quantify our question a little bit. Winding up
is a key term as well. All right, so next. We're
on question 16. We're about a third of the way
through. All right, so section 3 .7. The exercise
of the founder's powers does not cease to be
effective by reason only that the founder is
subsequently wound up and dissolved or ceases
to have the power. What the? Oh, okay, I see.
I see what's going on here. So if the founder
says, you know, I'm going to replace the director.
and before the director is replaced... Okay,
let's start over. So if the founder says, in
accordance with the power granted Section 3 .2b,
the power to remove or appoint directors, if
the founder says, I'm going to remove the director
and appoint a new one, and before that director
is appointed or removed, the founder decides
to irrevocably terminate their own power, then
that... founder's power does not cease to continue.
So I think this means that that director will
continue to be removed and the other one will
be appointed. And that can't be subverted or
changed just because the founder ceases to have
power. Right? So the founder can't leave and
then you say, no, we're not going to follow that.
I think that's what this says. Let's ask. Section,
so, Page four, section 3 .7. Does this mean that
if a founder makes a decision and then their
power terminates, the decision must be upheld?
After they leave. And so our example was. Remove
a director. Declared. A director. To be removed.
And then the founder. Leaves. Before the director.
Is removed. And maybe we won't use the word director.
Because. I hope we get the director to. I hope
we can interview the director. Perhaps. So let's
choose a member. Claire, a member. Be removed.
And maybe not removed. Let's go appointed. Appointed
a new supervisor. There we go. And then the founder
leaves before the supervisor is appointed. There
we go. That's a more positive example. All right.
So let's put in our keywords. So founder is a
keyword. Supervisor is a keyword. Founder again
is a keyword. As a supervisor. Okay. And that
was section 3 .7. So that's the end of section
three. So we just described the founder who has
god mode powers, apparently, to change everything.
And there's a little bit of confusion on my end,
at least, as to how the founder's power gets
terminated. Can it reverse its own termination?
Some things here that are a little confusing.
So we put that here in section... in our questions.
Okay, so articles, and now we're on section four
members. Section four one, the initial subscriber
to the Memorandum of Association shall be the
first member of the foundation company. Okay,
very good to know. So as we learned in Sandow
56, a subscriber is required to start the company.
That initial subscriber in this case has been
determined to be the first member of the foundation
company. Very good to know. So who is that initial
subscriber? You could see at the very bottom
who that was. International Corporation Services
Limited. That was the authorized signature. And
there it describes the subscriber. So this company,
ICSL, is the subscriber, which we know as a result
of SIP2, we have engaged ICSL to serve as secretary
and register office provider under the articles.
Where? Just say, I don't know who ICSL is actually.
Oh, wait, wait, wait. I think, I think we figured
this one out when we did birth of the Dow. So
we, what we did was we looked up. Y 'all can't
see what I'm doing. Oh, so if y 'all remember,
we, we did a little investigation. Here it is.
All right. So we think that ICSL is part of or
an offshoot of Travers Torvalberga. And then,
yeah, yeah. So let's zoom in a little bit. So
this was back a while back ago, but we believe
that ICSL, because we looked at Dunn's and Bradstreet,
that ICSL is owned by Travers Torvalberga. So
when we looked up Dunn and Bradstreet, we saw
that the key principal was Michael Alberga. Can
you read that? There we go. The key principal
is Michael Alberga. This is for ICSL. And we
also looked up the documents that we're reading
right now. So Travers Thorpe Alberga, Alberga
being the keyword there, he is one of the founding
partners or is a partner for Travers Thorpe Alberga.
So that tells me that ICSL runs. It is being
run by the legal counsel for the foundation.
I already asked that question. Oh, we asked IP
&A. Who is IP &A run by? And let's see, did we
already know that? Yeah, we don't know who that
is. So that's still a good question. But let's
also put as a sub question here, not a sub question,
sub answer. We were in the articles, right? You're
in the articles, right? So let's just put in
here, because we already know the answer. ICSL
is owned by a partner of TTA. Okay, so let's
copy paste that part in so that we can remember
this in the future. We already did this work
to figure this out. All right. So it's not exactly
listed here, unless somewhere where it describes
TTA. The foundation has engaged TTA to advise.
Oh, you all cannot see what I'm doing. There
we go. The foundation has engaged TTA to advise
on the foundation's formation and on legal matters
related to Cayman Island law going forward. Professional
directors require experienced legal counsel,
okay? TTA has extensive experience in the formation
and operation of DAOs and is qualified to serve
in this capacity. DAO will ratify the appointment
of TTA as came in on legal counsel, okay? So
that's where we determined Michael Alberga. That
is the same Michael Alberga in... Where's the
link? Travers Thorpe Alberga. Let me see. Let
me find it. All right, so Travers Thorpe Alberga.
Here's the law firm. And if we go to our people,
we shall see right there. Michael Alberga. Under
Travers Thorpe Alberga. So if we click that,
it will bring us to Michael Alberga. Managing
partner, Human Islands. Okay, so that's how we
made that connection. And again, nothing wrong,
nothing weird going on here. Seems like that
was contemplated in order to successfully stand
up and create our DAO. Okay, no problem. Makes
sense. At the time, we thought it was suspicious,
but the more we actually educated ourselves on
this, the more we got people, lawyers, advice,
not advice, lawyers to be guests to explain things,
and we delved into the laws and we read through
stuff. Nitty gritty? It's not quite so weird
anymore. I don't think there's anything really
going wrong here. Okay? So we are... Oh, we were
updating our question. Right, we were updating
our question. So ICSL is owned by... Owned by?
Let's look at the exact language. What does Dun
& Bradstreet say? Key principle, okay. So you
always want to err on the side of using the source's
words. It can get a little conflicting, like
does key principle really mean owned? Sometimes
it doesn't, which is why you never, you want
to try not to interpret or paraphrase for someone
else unless you actually know or hear what they've
had to say. So the key principle for ICSL, is
Michael Alberga. And as we saw, Michael Alberga
is a managing partner. So good to know. And as
you read in SIP number two, they, Travers Thorpe
Alberga has extensive experience in DAOs. So
the way that they're doing it here is, the way
they're doing it here seems to be tried, true,
and tested. They also seem to have a lot of offices.
New Zealand, Australia, Hong Kong, London, British
Virgin Islands, Cayman Islands. Okay, cool. Let's
go back. So now we're on section four. We just
read 4 .1. The initial subscriber to the Memo
Association shall be the first member of the
foundation company. Cool. Now we know what that
means. The subscriber is the one who initially...
creates the company. And then that's the first
member. I wouldn't be surprised if that first
member also became either the founder or the
director. Unsure. We'll keep reading. Section
4 .2. Subject to these articles, the directors
may, if so authorized by the founder or by a
special resolution of the foundation company,
admit as a member any person who has applied
for membership in writing, and the terms of admission
may restrict, enlarge, or exclude. any or all
of the voting and or rights or powers of members
under these articles or provide for termination
of membership at a specified time or in specified
circumstances. Cool. I wonder if the special
counsel or advisory board are members. Let's
ask. Let's ask that question. Page 4. Section
4 .2. Is the... SC or AB members? Okay. And the
second question would be, did the initial subscriber
become the founder or director? All right. So
we're trying to connect some dots here. It's
helping us understand how this is run. Right?
If not, what are they? Are they beneficiaries?
So then our 18th question, did the initial subscriber
become the founder or director? Okay. That was
both of those are 4 .1s. No. Fixed. All right.
Now we're on. Next up, question 19. Okay. We
just read through section 4 .2. Now we're going
to 4 .3. The founder, by notice to the foundation
company or the foundation company by special
resolution, may restrict or prohibit a subsequent
admission of members. If the restriction or prohibition
is expressed to be irrevocable, it may not be
altered or revoked directly or through an alteration
of the articles. But it sounds like the founder
can... It's not like the founder can change anything.
So page 4, section 4 .3. But the founder can
overturn this irrevocable prohibition. So can.
Can the founder. overturn this irrevocable prohibition.
See how all this stuff, this is how, this is
how these things are done. This is how you determine
what really goes on. So when I was showing you
all earlier, over here, when I did my, when I
did my, relationship map in standoff 56 this
this triangle of confusion i said so let's go
back to it ready here we go oh that's not it
that's not what i'm after hold on link must be
broken uh my triangle confusion yeah whoops was
i didn't know the relationship of everyone here
And then I expanded upon that in Sandow 57, where
we talked about this flowchart. And Sandow 57
looked like this, or 56, excuse me, looked like
this. And I upgraded my triangle of confusion
to my rectangle of confusion, because it still
wasn't clear. Although we knew who else was doing
stuff, we knew more of what was going on, we
still didn't exactly know how they all played
together day to day. And Sandow59 with the lawyer
guests, they helped explain a little bit of it,
but we didn't get time to the question and answers
to figure that out. So that's where I want to
know what actually is going on between all of
these people here. What's going on here? And
after Sandow59, we were able to clarify that
a little bit, but it's only this part on the
left. All we know is more of what happens on
the left. I still don't fully know what happens
on the right. So I'd like to do an interview
with the director, Michael Robinson, if we can.
I'd like to do an interview with, you know, have
one of them on. I think that'd be really cool.
I think kind of give us some guidance. What really
goes on there? Okay. And we are here. All right.
And I know we want to, how do these positions
interact day to day? So that's a question we
want to ask of what, which section? We want to
ask this of section in general. It's going to
be a general question, but we're going to ask
it here while we're in the member section. There
we go. Okay. That sounds good. And let's go...
Yeah, you know what we're going to do? So here,
we're going to... We're going to take our rectangle
of confusion. And then we're going to paste it
in here so that we remember why it was we were
asking this question. Okay, so I pull open that.
I go like this. And then let's crop it a little
bit. All right, so this is so we can remind ourselves
why, what are we referring to? I guess I need
to later on. Okay, so general question. We read,
what did we read last? Founder by notice to company.
Okay, yeah, so we may restrict and prohibit the
subsequent admission of members. So that general
question actually is going to be a question for
section 4 .3. Section 4 .3 may restrict or prohibit
members. All right, so we want to know more about
this. How do all the positions interact day to
day? There we go. All right, now section 4 .4.
A person's membership of the foundation company
terminates section 4 .4a. If the person dies
or being a corporation is dissolved, section
4 .4b, if the person resigns as a member by notice
to the foundation company, the resignation shall
be effective immediately unless the notice states
otherwise, or section 4c, as provided in the
person's terms of admissions as a member. Okay.
Section 4 .5, it is not a condition of this article
that the foundation company continues to have
one or more members. Okay. Section 4 .6, the
rights and powers of members are not assignable
and transferable to someone else. And except
as permitted by these articles are required by
law, the rights or powers of a member may not
be exercised by any other person on behalf of
the member. Okay, so same thing as the founder.
Section 4 .7, the rights and powers of members
are free of any duty. Now that sounds very familiar,
but changed from the founder. The founder said
the founder's power in section 3 .3 are free
of any duty. And maybe exercise for the founders
on benefit. So what does that, what does not
including that mean? I think we asked that question
already, didn't we? And maybe exercise for the
founders on benefit. So, and we're going to put
reference 3 .3. Okay. So we want to reference
3 .3 there. Where members don't have this. Okay,
so we're going to put that as blue. So not blue.
There we go. That one. So that one will tell
us. That one will tell us. I put that in as kind
of like an aside. We can ask that later. Okay.
So we're in a section three, three. Now we're
in section three, four. The founder may, by notice
to the foundation company, revocably or irrevocably
terminate or restrict. Any or all the founders'
powers, if the termination or restriction is
expressed to be irrevocable, it may not be altered
or revoked directly or through an alteration
of these articles. Isn't that? Oh. Shoot. My
fault. I skipped. I went back on accident. That
was section 3 -4. We already read that. Let's
go to section 4. We read through all the members.
We went through section 4 -7. The rights and
powers of members are free of any duty. That's
where we went down that other rabbit hole. Okay,
now we're on section five, directors and officers.
The foundation company, section 5 .1, the foundation
company shall at all times have at least one
director. Okay, didn't know. That's consistent
with what we learned in Sandow 56, where you
had to have a director and a supervisor and a
secretary. And the secretary had to be licensed
in accordance with the... The Companies Management
Act. All right, section 5 .2. The first directors
may be appointed by the subscribers to the memorandum
of association. There we go. That tells you the
power right there. Let's go back to what question?
Did the initial subscriber become the founder
or director? What we want here is a reference,
section 5 .2, where it says, First director may
be appointed by the initial subscriber. See,
this is starting to really paint a picture. Starting
to see how the relationships are playing out.
I just don't know how it plays out day to day.
I know how it's described here and starting to
play out this way. I don't know the rest of that.
We want to reference 5 .2 where it says the first
director may be appointed by the initial subscriber.
So does this work in the way that our lawyer
guests in Sandow59 said where it's first director
-led and then token holder -led? If y 'all recall,
it was here that we did that. Director -led,
token holder -led, and under the timeline of
events. And that was this one here. We just did
it just the other day with Melissa and Carolyn.
Okay, now we have it saying in section 5 .2,
the first director may be appointed by the subscribers
to the memorandum of association. Section 5 .3,
the founder has the power exercisable by notice
to the foundation company to appoint or remove
directors, including the founder if the founder
is one. Okay. So the founder can remove themselves
as directors? Okay. I'm confused as to why we
had to call this out here, but okay. I guess
it's just to remove all doubt, I suppose. Section
5 .4. By ordinary resolution, which means simple
majority, the foundation company may appoint
or remove directors. Okay. So the foundation
company, the founder isn't the only one who can
remove directors. Apparently, the foundation
company may... but ordinary resolution. And that
was a simple majority at a general meeting. Oh,
you all cannot see what I'm saying. Okay. That
means ordinary resolution meant a simple majority
at a general meeting. And we were just reading
these sections. So we read that one. We read
that one. And we just read section 5 .3 here.
Including if the founder is one. All right, now
5 .4. By ordinary resolution, the foundation
company may appoint removed directors. That's
the one we just finished reading. Section 5 .5.
A person ceases to be a director if removed under
the foregoing provisions. Or, okay, section 5
.5a. If the person dies or becomes bankrupt or
being a corporation enters into winding up or
is dissolved. Or, section 5 .5b. If the person
resigns as director by notice of the foundation
company. The resignation shall be effective immediately
unless the notice states otherwise, or there
are no other directors in which case the resignation
shall be effective upon the appointment of a
further director. Meaning the director can't
just leave and no one's there to replace them.
That's fascinating. So I guess here it says that
they can require that director continue to serve
until a new director can be a... Take their place
effective immediately. Section 5 .6. Subject
to these articles and the bylaws, the business
and affairs of the foundation company shall be
managed by or under the control of the directors
who may exercise all the powers of the foundation
company other than those that are required by
these articles or the bylaws to be exercised
by the general meeting or others. So do they
have the same power as the founders? The part
that's confusing me here is it may exercise all
the powers of the foundation company. And part
of the powers of the foundation company is the
power of the founder. It's a little confusing,
I think. Let's do a question out of that. 5 .6.
It may exercise all the powers of the foundation
company. Mean it can exercise the director can
exercise the founders powers. Here we go. It's
a good question. So director is a keyword. Founder
is a keyword. Foundation company is a keyword.
So I just updated and put in question number
19. Oh, I already had that in mind. My bad. So
we're actually question number 21 now. It's a
lot of questions. But this is all the stuff that's
still confusing. When I say my rectangle of confusion
here, that's what I'm referring to. This stuff.
Okay? Section 5 .7. The directors shall observe
these articles and the bylaws and shall at all
times act... In the interests of the foundation
company and its objects. That sounds a lot like
fiduciary responsibility. Is that just a confirmation
or is that extra too? That's that. Seven. Is
this extra to the fiduciary duty? Or a confirmation
of? Affirmation of? Right? Does it reinforce
it? Or does it only reinforce it? So we want
fiduciary duty. Section 5 .6. Nope, we're just
at section 5 .7. Okay. Section 5 .8. The director
shall give the founder or the general meeting,
in parentheses, or the persons who have the right
to attend the general meeting, in parentheses.
Such reports, accounts, information, and explanations
concerning the business and affairs of the foundation
company and the discharge of the director's duties
and the exercise of their powers as may be required
by 5 .8a, notice from the founder, or 5 .b, ordinary
resolution of the foundation company. So this
just tells the director has to give information
when asked by specific people. Okay. Section
5 .9, the duties of the director are owed to
the foundation company only. Section 5 .10, director's
remuneration, remuneration just means compensation
or salary, shall be at such rates and on such
terms as may be agreed in writing by the founder
or by an ordinary resolution of the foundation
company. So we already know what this is. We
looked at SIP 2 and under resources, and under
resources, we see directors is being paid $30
,000 annually. Right here. Okay. This is section
5 .8. We just read that. Section 5 .9. Section
5 .10 is what we just finished reading about
the remuneration. Section 5 .11. Subject to the
foundation company's memorandum of association.
these articles and the bylaws, the directors
may delegate any of the powers which are conferred
on them under the foundation company's memo of
association, these articles and the bylaws. Section
511A. To such person or committee. Section 511B.
By such means, including by power of attorney.
Section 5C. To such an extent. Section 5D. For
such periods or periods of time. Section 5...
Section 511E, in relation to such matters or
territories. Section 511F, on such terms and
conditions as they think fit. Okay. Section 512,
if the director so specified, any such delegation
may authorize further delegation of the director's
powers by any person to whom they are delegated.
Okay, I see what's going on here. So in Section
511, the director is allowed to delegate. as
in confer or transfer or also authorize someone,
the power that they have, then that person, that's
section 511. Then section 512 says the person
that was just delegated all that power by the
director is also allowed to delegate their power
to other people. So you start to get this tree.
Director delegates. Let's say to delegate to
two people. Those two people can then delegate
to however many, four people. All right. Section
513. The directors may revoke any delegation
in whole or part or alter its terms or conditions.
Section 514. Committees to which the directors
delegate any of their powers must follow procedures
which are based as far as they are applicable
on those provisions of the Foundation Company's
Memorandum of Association. These articles and
the bylaws which govern the taking of directions
by directors. Okay, let's reread that one. 5
.14. Committees to which the directors delegate
any of their powers must follow procedures which
are based as far as they are applicable on those
procedures, provisions of the foundation company's
memo association. These articles and the bylaws
which govern the taking of decisions by directors.
Okay. So. In the first part, it says the committees
to which the directors delegate any of their
powers. So it says they can be delegated to a
committee, okay? Must follow procedures which
are based on those provisions of the foundation
company's memo association. Okay. The memo association
had the objects, right? So it had the objects
and then it had the section below it which expanded
on those objects. That's probably what it's referring
to. Here. There's the objects under Section 3
of the Memo Association. And Section 4 has those
A through O things that it can do. I think that's
what this is referring to. Okay. This last part,
though, these articles and the bylaws which govern
the taking of directions, decisions by directors.
Oh, that's a comma. Okay. So the committee. that
has delegated the power must follow the procedures
of the foundation company's memo of association
and these articles of association. So they don't
have to just follow, you know, the objects and,
and here they have to follow all the things in
this article as well that we've ever reading
right now. Okay. Makes more sense now. 5 .15.
The directors may make rules of procedure for
any committees for all of any committees. which
prevail over rules derived from these articles
if they're not consistent with them. Nice. So
if the director decides to make special rules,
such as maybe the special counsel? Code of conduct?
I'm sorry, the delegate? The delegate code of
conduct? Is that considered a committee? Let's
ask. Page 7, section 5 .15. Is the DSB DAOs...
Approved delegates. Is the code of conduct or
the TSB does approved delegate considered a committee?
Is SC and AB. So we're going to highlight our
keywords here. Code of conduct. And does everyone
remember what code of conduct we're talking about
here? All right, so if we go to our DAO and we
go to delegation, where's our code of conduct?
Looks like it's in here somewhere. Here to the
code of conduct, code of conduct. Where's this
code of conduct? Code of conduct is what every
delegate had to... Oh, here it is, type form.
I bet you it's in here. We talked about this.
So I'm just going to work through this. Try and
get there. We did this on another Sandell podcast
when we said the delegation was here. That's
what the episode was called. Delegation is here.
Which one was that? So delegation is here somewhere.
Would have been right. There. Episode Sandow
28. Delegation has come to the Sandbox DAO. That's
the one where I go over this in detail. So if
you want to look at what this type form is all
about, then just go to that one. And we're looking
for the code of conduct. There it is. Right there.
Let's click this code of conduct. Oh. Is there
a link somewhere that I missed? I must have missed
the link. Okay. So we're going to go now to our
code of conduct link and link it here so that
we know where it is in the future. So this code
of conduct is what we're referring to where the
sandbox DAO people delegates were required to
adhere to this code of conduct. Right? Good stuff.
Good stuff. So the question was, is the code
of conduct for the TSB Dells approved delegates
considered a committee? Is this special counsel
or AB advisory board? All right. And we just
went over 515 where the directors may make custom
rules. All right, 516. Notwithstanding the above,
the directors may appoint. such officers as they
consider necessary or desirable on such terms,
at such remuneration and to perform such duties,
and to subject such provisions as to disqualification
and removal as the directors may think fit. Unless
otherwise specified in the terms of their appointment,
an officer may be removed by the resolution of
the directors. Okay. And I don't think SIP 2
talked about the remuneration of the officers.
Just talked $50 ,000 for legal expenses, $30
,000 for director's expenses. So let's actually
put this in our slide. Which question was it?
Where did we talk about the remuneration? This
is the director, right? Section 5? Yeah, so the
directors and officers. So for Section 5, we
talked about 515. is our question on 515. okay
and then we're just gonna put a little reference
in here um sip two director re on a ration so
um uh compensation just so we can remember that
later sure goes where it's supposed to go oh
time some time Having some trouble thinking.
All right, we'll look at that later then. Okay,
let's keep it going. We're on now, section six.
Almost there. Almost halfway through, at least.
I'm going to take a quick two -minute break.
So everyone, take a bio break if you need to.
Use the restroom. We'll see you in two minutes.
We went through Section 5 .15, then we went through
Section 5 .16, and that concluded the part about
directors and officers. Now we're on Section
6, supervisors. Section 6 .1, the initial supervisor
is International Protectors and Advisors Limited
of Harbor Place, 2nd Floor, 103 South Church
Street, PO Box 472, Georgetown, Grand Cayman,
KY1 -1106, Cayman Islands. Section 6 .2. The
founder has the power, exercisable by notice
of the foundation company, to appoint or remove
supervisors to supervise the management of the
foundation company. Section 6 .3. The founder's
notice appointing a supervisor may Section 6
.3a. Restrict, enlarge, or exclude any or all
of the voting and other rights or powers of the
supervisors under these articles. Section 6 .3b.
impose any supervisory or other duty or disability,
grant a related exculpation. What does that word
mean? I don't actually know what that word means.
Exculpation is the act of freeing someone from
blame or guilt. It can also refer to a clause
in a contract that limits one's party's ability.
Is that the same thing as indemnification? Is...
Exculpation, the same as indemnification. Let's
take a look. Exculpation and indemnification
are both contract clauses that shift liability
between parties, but they have different purposes.
Exculpation prevents a party from recovering
damages, receives a party from liability for
their own negligence or wrongful acts, or relieves,
excuse me, relieves a party liability. and is
often using contracts for dangerous activities
such as skydiving or whitewater rafting. Is our
DAO a dangerous activity? Okay, let's keep going.
Indemnification shifts liability from one party
to another. One party compensates the other for
losses, damages, or liabilities, is often linked,
is often used in private fund governing documents
to protect managers and affiliated persons from
losses. Okay, fascinating. So exculpation, again,
prevents a party from recovering damages, relieves
a party from liability for their own negligence
or wrongful acts. Okay, these examples include
a landlord might include an exculpation clause
to limit their liability under release. A gym
might include an exculpatory clause in a membership
application to relieve the gym from responsibility
for injuries sustained while working out. Exculpatory
clauses are generally enforceable unless there
is specific public interest or statutory exemption.
Okay, so let's reread this. Section 6 .3b. The
founder's notice appointing a supervisor may
impose any supervisory or other duty or disability,
grant a related exculpation, and waive conflicting
interests or duties. from one to prevent a party
from covering damages or relieving a party from
liability for their own negligence or wrongful
acts. Okay, got it. Section 630C gives the supervisory
rights to remuneration or indemnity by the foundation
company. Okay, so not just exculpatory stuff,
but also indemnification, which is where the
foundation company would take on, like if...
if the supervisor got sued, right? To indemnify
them would mean that this founder's notice, which
I guess would be conferred upon the foundation
company, the foundation company would indemnify
the supervisor, meaning pay for or relieve them
of the responsibility, right? So it would be
shifting the ability. So if they get sued, then
the foundation company would take on that paying
for that suit. That would be compensate the other
for losses, damages, or liabilities. That sort
of thing. That is to indemnify. To exculpate
someone, I guess, means they're not allowed to
ask for money. That's fascinating. Okay, 6 -3
-D. Provide for the termination of the supervisor's
appointment at a specified time or in specified
circumstances. Okay, very broad. We're talking
about the founder's notice, okay? So that notice
and point the supervisor can have. A lot of restrictions
is what we're reading here. Section 6 -4. A person
who is a supervisor has the power by notice to
the foundation company to appoint a person to
succeed the person as supervisor immediately
or at a specified time or in specified circumstances,
with and subject to the same terms of appointment
as applied to the appointor, and to revoke such
appointment at any time before it takes effect.
Okay, so the supervisor may delegate. their own
person to succeed them. All right, so a person
who is a supervisor has the power, as long as
they notify the foundation company, to name who
is going to replace them immediately or at a
specified time in the future. And that the same
appointment notification that they got to be
appointed supervisor also applies to the person
they named that's going to replace them. That's
what 6 .4 is saying. Section 6 .5. A person ceases
to be a supervisor if Section 6 .5a. If the person
dies or becomes bankrupt or being a corporation
enters into winding up or is dissolved. Section
6 .5b. If the person resigns as a supervisor
by notice to the foundation company, the resignation
shall be effective immediately unless the notice
states otherwise. Section 6 .5c. If the person
becomes a director or acquires any interest or
duty that conflicts with any duty of the person
as a supervisor, unless authorized by the founder
or by special resolution of the foundation company,
that's just conflict of interest. Let's see if
that's applicable to anywhere else. No, the directors
and officers have to at all times act in the
interest of the foundation company, but they're...
It looks like there may be a conflict of interest
present for directors and officers, and that's
permissible, or at least not covered by Section
5 here. But if you are a supervisor, you may
not. Where's that conflict of interest thing?
There. You cannot have a conflict of interest.
Interesting. Section 6 .5d, as provided in the
person's terms of appointment as a supervisor,
or Section 6 .5e, is removed by the founder.
Section 6 .6. The foundation company is required
at all times after the founder's death or if
the founder is incapacitated to have at least
one supervisor who is not a director and is able
and willing to supervise the management of the
foundation company. If this requirement is not
met, the foundation company shall, by ordinary
resolutions, appoint one or more supervisors
on such terms as it thinks fit. To make up the
shortfall, failing which the director shall apply
to the court under Section 9 .2 of the Foundations
Company Act, revised. I think we went over this.
All right, so what was the Foundations Company
Act? Okay. So in our Foundation Company Act here,
Section 19 .2. Nope. We didn't. We stopped with
Section 17. So in Section 19 .2. And the Foundations
Company Act covers how to apply to the court.
We glossed over that in Section 56. We did it
very, very briefly, only because it didn't seem
super relevant to us. But here, if there is some
sort of shortfall and they need legal remediation,
then they can apply to the courts, and the courts
generally have a duty to help resolve that. And
they have the ability to apply a wide, wide range
of powers. I know we went over that a little
bit. Oh, oops, it was right there. Grand court
functions. Here. Part five was the grand court's
functions, of which was section 19. The court
plays an important role in resolving foundation
company disputes, appointing and removing members,
conducting investigations. So that's what this
is referring to. In part five here is section
19. That is... That is... specified here in section
6 .6 of the Articles of Association. Good to
know. So something in here that caught my attention.
A foundation company is required at all times,
after the founder's death, or if the founder
is incapacitated, to have at least one supervisor
who is not a director? Where do we read that
the supervisor is allowed to be a director? I
remember reading that. Have at least one supervisor
who is. Not a director. Right. Where did we read
the supervisor could be the director? I remember
reading that. And. I think it was. I think it
was in the preamble. All right, so we got a supervisor.
We got the director. We got the supervisor again.
We got the director again. Here are key words
for this question. This is a fascinating one
because I can't remember where we read it. Was
it can also? Is also? No. I don't remember where
that was. So reference. Cannot remember where
it was stated. So if someone says, I don't remember
that, then I'll be like, okay. I'm pretty sure
we read that. Maybe it was in the articles. Or
in the memo. Where we talked about members. Now
let's search director. Oh, you know what? Supervisor
had less. Okay, no, it would have been here in
the articles then. Supervisor. Okay, we're in
section six now. 6 .3. Opposed. Right. Okay,
that's where we are now. I don't remember where
we read it. We read it somewhere, though. All
right, let's just keep going. You're in section
6 -5, and we just read 6 -6. Right there. Now
we're under 6 -7. A supervisor, 6 -7 -A, may
require access during normal working hours to
the files, books, accounts, and records of the
foundation company. Cool. That's a good check
and balance of power. Section 6 -7 -B. May by
notice of the foundation company call for such
reports, accounts, information, and explanations
from the directors as to the administration of
the foundation company as are described in the
notice. So an important thing here to remember
is that the enforcement here is if the supervisor
does not feel that they are getting satisfaction,
they are able to bring an enforcement action
against the foundation company. And Sandow59,
with the lawyers as guests, did articulate that
as part of their brief. It was here, and it was
toward the end, I think. Oh, here it is. The
supervisor will retain the unconditional right
to attend. There we go. And to bring an action.
on behalf of the company for the enforcement
of the duties or liabilities of the directors.
And we went over this in Sandow 56 when we were
reading about the powers of the supervisor. They
could bring an enforcement action. And as we
just read in here, the grand court's function,
the grand court plays an important role in resolving
those disputes of which could be the enforcement
action. So that's how it all kind of fits together
there. Cool stuff, man. This is so cool. All
right. No question yet. I don't think I have
any questions yet. Section, we just read section
six, seven B. Okay. Six, six, six, seven C. Six,
seven C has the right to receive notice of and
attend and vote at general meetings and six,
seven D. shall observe the foundation company's
memo of association, these articles, and the
bylaws. Section 6 .8. The powers granted to a
supervisor under these articles may only be exercised
in the interest of the foundation company and
its articles. Oh, excuse me, and its objects.
Okay, got it. Section 6 .9. Any duties of a supervisor
are owed to the foundation company only. Section
6 .10. The remuneration of a supervisor shall
be at such time commercially reasonable rate
and on such terms as agreed in writing by the
supervisor and the directors and otherwise in
accordance with its standard terms of business
from time to time in effect. Let's take a look
at SIP 2. Did it name the fees for supervisor?
Oh, the $50 ,000 here includes. Oops, where am
I? There. The $50 ,000 here includes. supervisor,
founder fees, and secretary fees. So not just
legal fees. Okay, good to know. I wonder, is
SIP one? Is SIP one? Oh Lord, that might take
a little bit. All right, we're done with section
six, which is the supervisor. Now we're going
to section seven, which are the beneficiaries.
One of our earlier questions was, who are the
beneficiaries? Section 7 .1. The foundation has
the power, exercisable by notice of the foundation
company. Section 7 .1 .A. To designate persons
or descriptions of persons as beneficiaries,
conditionally or unconditionally. Section 7 .1
.B. To give directions as to the benefits of
which a beneficiary will or may receive from
the foundation company. Section 7 .1c, to declare
that the beneficiary shall have an enforceable
right to receive benefits from the foundation
company or any other rights in or against the
foundation company, or that the beneficiary is
an interested person for any and all of the purposes
of the Foundation Companies Act revised. And
Section 7 .1d, to revoke or vary any such designation,
direction, or declaration. And the founder has
so much power. But one of our questions we asked
earlier was about... Who's the beneficiary? Let's
take a look. Where did we ask that? I think we
asked it in, I think we asked it in the memo.
Oh, there we go. Question number five, who are
the beneficiaries? And we want to reference articles
association, page nine, section. 7 .1 C. Okay,
so now we need to make that highlighted. Okay,
so if we need to reference what is it about the
beneficiaries that we're looking at here, one
key point of interest is to declare that beneficiaries
shall have enforceable rights and receive benefits.
So once we figure out who those beneficiaries
are, we can figure out then what sort of rights
do they have. Because this Section 7 says the
founder has the power to declare that. Okay?
Where's that enforceable action thing? It was
under the supervisor, right? The supervisor.
We're just talking about here and the beneficiaries.
Section C. So who was the enforceable part? Shall
observe. Did we have a question for section 6
.6? Oh, did we read the supervisor? Did we read
that it could be? Okay. Where was the part about
the courts? May require access? No. Call for
such reports? Oh, it was under 6 .7b. Okay. So,
page 8, section 6 .7b. May call for... Such reports
accounts all that stuff and the reference here
was Sandow 56 Slide Slide what 88 and that was
part 5 of FCL Brand ports function And then also
reference Sandow 57, slide, oh, not 57, 59, excuse
me. Sandow 59, slide 40. Supervisor enforcement
action. Cool. This is how you weave all this
stuff together. All right, so what I'm doing
here is I'm weaving together in case I need to
go back to it to have a discussion or to do a
Q &A. This is where we do it, where we talked
about it. All right. All right, let's go back.
All for such reports. Shall observe. Okay. We
were in beneficiaries, weren't we? Yep, we adjusted
to declare the beneficiaries to have enforceable
right. So there is another part. So page 9, section
7 .1. Oops, wait a minute. Here we go. Page 9,
section 7 .1. Charlie. And what we're looking
at shall have an enforceable right. That enforceable
right is referenced by what we just went over.
Sandow 56, slide 88. But also, let's take a look
at Sandow 59. Did we talk about it there? Let's
take a look. It was this one. So there's supervisor.
What did we talk about? The beneficiary. Didn't
we talk about it? Beneficiary. Those are all
the questions I did have at one point. And nope.
So there was no discussion of beneficiaries here.
That will be part of the Q &A. We were able to
have one. Okay. And it was not discussed. And
then let's ask what enforceable right. Yeah.
Beneficiaries. That's our key word there. Shall
have an enforceable right, right? So let's figure
out what that right is. I think it's the right
to go to the courts, the grand courts, but do
they get enforcement actions? Okay. Oh, oh, oh,
oh, oh, restriction notice. We need to talk about
restriction notice. Yeah, need more clarity on
that restriction notice thing. It's a general
question. And this was, you know what, let's
go ahead and reference the actual slide. When
we did our Q &A here. I asked, are they the eyes
and ears in the Sandow 59? Carolyn said, yes,
in a sense, but the supervisor is a passive role.
The article spell is power, which is what we're
reading now. And then Melissa said, restriction
notices apply to the beneficial ownership regime,
which I think was the token, maybe the token
holder led phase. I think I need to ask that
question. All right, so that would be. reference
slide send off 59 slide 53 which was uh eyes
and ears question hey play a game for fun thank
you for rating appreciate that yes i am still
going i'm still going i appreciate that we are
about halfway done with the of association. This
has taken out, this turned out to be a really,
really long episode, but it needs to be done
and we need to get through it. Appreciate that,
Raid. I play game for fun. All right, where did
we leave off? Section 7 .2. Subject to any unrevoked
declaration under Article 7 .1c. That would be
the declaration to have an enforceable right.
A beneficiary does not, as such, have any rights,
powers, or interests in or against the foundation
company, the founder, the directors, the supervisors,
or any property of the foundation company, except
Section 7 .2a, the right to retain any benefit
that has been properly conferred upon the beneficiary
by the foundation company, and Section 7 .2b,
the right exercisable by notice to the foundation
company to terminate the beneficiary's status.
as a beneficiary okay play game for fun in the
chat said try to play as many games as others
creators especially those who post their experiences
on my discord right on um how about you message
me on twitter and twitter dang it message me
your discord link here in twitch whisper it to
me though because i think my bot will try and
time you out if you do that So just whisper it
to me, and then I'll post it here for everyone
to see. How about that? Thank you, PlayGame.
All right, next up. Oops, this is way past that.
So 18. What's going on? 9, 10, 11, 12, 13, 14,
15, 16, 17, 18. This should be 19. 19. 2021.
22. There we go. 27. Hold on a second. I think
I messed something up. I did. I must have gotten
something out of order. This is 19. 67, 18, 19.
Okay, good. So we will. All right, cool. I think
we're back on track. 19, 20, 21, 22. This would
be 23. And this is question 24. Page 4, page
5. This is page 7. Oof, I messed up a little
bit here. The ordering. Section 4. So it's page
2, section 1. Section 3. Section 3. Section 3,
7. Section 4. section four section five section
five section six section seven and there's section
four three okay good to go now we're on we're
on now question 25. 25 questions already it's
a lot play game for fun said oh i've just realized
i forgot to draw the winner on my coin i'll check
there in the beginning of my next stream if you
want to announce the winner here now play game
i can highlight your message i can highlight
it here and then you can alert them elsewhere
boom right there big big old stuff right across
the stream up to you though all right and play
game for fun's discord if you want to get involved
in the stuff that he does he streams quite a
bit And he's been a good, great member of SanFam
for quite some time. Take a look at his Discord
here. That is play game for funds. Discord where
you can win stuff. Let's try that again. Funds
Discord is that. There we go. Okay, that didn't
work. But there it is in chat. Bottom. Go ahead
and click it and join and have fun. All right,
so now I think I have this right. 4 -3, 5 -6,
section 5 -7, section 5 -15, section 5 -6, section
6 -7, section 7 -1, and then there's the general
question. Okay. Okay. 9 -12, question 13 -15,
question 16 -18, question 19 -22. Question 23.
Good to catch this stuff in the moment. And then
question 23, 25. And this is question 26. Holy
smokes, that's a lot of questions. All right.
So now we're on question 28. And we are now starting
to read section 8. Secretary. Section 8 .1. The
first secretary is International Corporation
Services Limited of Harbor Place 2nd Floor, 103
South Church Street, P .O. Box 472, Georgetown,
Grand Caymans, KY1 -1106, Cayman Islands. I think
we already clarified that what this was. The
key principal for ICSL is Michael Alburga, partner
of TTA. Yeah, so we'll... There isn't anything...
I don't think I have a question here. Section
8 .2. The founder has the power, exercisable
by notice of the foundation company, to the foundation
company, to appoint or remove the secretary or
any assistant secretary. So we can have an assistant
secretary, it looks like. Provided always that
there shall be at all times a qualified person.
as defined under the law appointed as a secretary,
and no secretary shall cease to hold office until
a qualified person has been appointed in the
secretary's place and the registrar has been
notified. So we have gone over this quite a lot.
The qualified person part, that qualified person
is specified quite a bit in Sandow 56, where
we talk about what qualified people means. And
where did we talk about it? Here. Qualified person
and page five and six of the Foundation Companies
Law, also called the Foundation Companies Act,
means a person who is licensed or permitted by
the Companies Management Law, otherwise known
as the Companies Management Act, to provide company
management services in the islands. And so that's
a good little reference thing. Reference Sandow.
56 slide 85, which is FCL. What was that? FCL
part one, section two. Two. Means a person licensed
or permitted by CMA. All right. Oops, did not
be highlighted. All right, where else are we
looking for? FCL is a key phrase. Licensed. A
qualified person. Oh, it's just a person. Licensed
or permitted. These are also key phrases. As
is CMA. All right, and the reason why we brought
that up was section 8 .2. And what was the question
here? Was there a question? Assistant secretary
can be not qualified? Is not required to be a
qualified person? All right, that was the question
here. Is the assistant secretary required to
be a qualified person? That's our question. Here
is a reference. Okay, there we go. And these
are reference. Okay. Now we're on question number
29. We're moving right along here. Oh, that's
how that happened. Okay. I see now why it got
out of order. And this gets highlighted. So is
the assistant secretary that gets as a key for
keyword as this qualified person? It's a keyword.
All right. Now we're on section, oops, we didn't
put what the question was for. It was for page
10, section 8 .2. Our next question is our next
read, section 8 .3. Directors may appoint and
remove the secretary or an assistant secretary
provided. There shall be at all times a qualified
person as defined under the law appointed as
a secretary and no secretary shall cease to hold
office until a qualified person has been appointed
in the secretary's place and the registrar has
been notified. Section 8 .4. The remuneration
of the secretary shall be, remuneration means
compensation, how much are they paid, shall be
at such a rate and on such terms as agreed in
writing by the secretary. and the directors and
otherwise in accordance with the standard terms
of business from time to time in effect. Section
8 .5. The secretary shall at all times comply
with the requirements of regulation laws as defined
in Section 2 of the Companies Act, revised, and
shall be entitled to receive from the foundation
company and any interested person such information
as the secretary may reasonably require for such
compliance. Now, if you remember what we talked
about, The secretary was required to do a number
of things. They had to determine and assert a
vast number of things. Determine? Was it assert?
Or did I use? I used a very specific word. I
think I pretty much used declaration. I think
it was declaration. To declare. There. So the
secretary must state no objection when things
are given to them. They must assert that no changes
declare that no changes have been made. And when
changes are made, they must declare that. They
must also what? There's a bunch of stuff that
they must declare. So that. That's what we're
referring to in Section 8. Right there. Section
8 .6. Section 16 of the Foundations Company Act
revised shall be observed. Okay. What was that
again? Let's look at what that was. We looked
at all that stuff in the beginning. Section...
What? Section 16. The Foundations Company Act.
Okay. Huh. I don't have Section 16 here. Let's
take a look real fast. What was that? Let me
know what that is. So we're going to pull open
the legislation document and look at Section
16. Oh! Oh, right, right, right. Not Part 16.
Section 16. My fault. Forgot that they do that.
So... The foundation's company law uses parts,
but each part has a numbered section number.
And the good news is they start with section
one in part one, and they conclude with section
whatever in part six. And it's all the way through.
It doesn't start over. Like part two doesn't
start over with a section one. It's section whatever
you ended with for part one. So we can find that.
So what's section 16? Section 16 is a secretary.
a foundation company shall have a qualified person
as its secretary. Okay. And if you wanted to
read more about that, you go to the foundation
company law act itself. And it's, it's a pretty
short read here. There's only four sub parts
to it. Section 16. All right. Shall continue
to hold office until a qualified person has been
appointed. Person who's not a qualified person
may be appointed subject to contrary provisions,
blah, blah, blah. Okay. Section 8 .7, a person
ceases to be a secretary if Section 8 .7a, if
the person dies or becomes bankrupt or being
a corporation, enters into, winding up, or is
dissolved, or Section 8 .7b, if the person resigns
as secretary by notice of the foundation company
and the resignation shall have effective immediately
unless the notice states otherwise. provided
that there shall be at all times a qualified
person as defined under the law, appointed as
the secretary, and no secretary shall cease to
hold office until a qualified person has been
appointed and the secretary's place and the registrar
has been notified. That's taken right out of
the law. So, no questions there. Section 9. We're
now in Section 9. General Meetings. Section 9
.1. The secretary shall convene a general meeting
when required to do so by written request of
Section 9 -1 -A, the founder. Section 9 -1 -B,
any person who has the right to attend general
meetings, which is a supervisor, or could be
the beneficiary, depending on how the founder
appoints the beneficiary. And Section 9 -1 -C,
the directors. Section 9 -2, the persons who
have the rights to receive the notice of and
to attend and have one vote each at the general
meetings are. Section 9 -2A, the founder. Section
9 -2B, any members. Section 9 -2C, the supervisors.
And Section 9 -2D, any beneficiary to whom the
right has been granted by an unrevoked declaration
under Article 7 -1C. We talked about that already.
Here's 7 -1C, where the founder has the power,
exercisable by notice of the foundation company,
to declare a beneficiary that has an enforceable
right. Okay? Now we're at section 9 .3. General
meetings shall be convened by not less than 21
days notice. And in parentheses says, exclusive
of the day on which the notice was served. In
parentheses. To everyone entitled to attend,
unless all persons entitled to attend agree to
short notice or no notice. The notice shall state
the place, day, and hour of the meeting and the
general nature of the business to be transacted.
Section 9 .4. The accidental omission to give
notice of a general meeting to any person so
entitled or the non -receipt of a notice of a
meeting shall not invalidate the proceedings
at that meeting. That's interesting. Let's make
a question of that one. Our 29th question is...
Page 11. Section 9 .4. Why does the... accidental
omission, not invalidate the proceedings. Why
is that true? Because this gives kind of a loophole
for a power play to occur. I think I noted this
when I first read it. If they're not required,
if accidental omission, and that accidental word
can be loosely interpreted, I forgot to send
you the notice, Mr. Supervisor. Sorry about that.
But we held the meeting anyways, and it doesn't
invalidate the vote where we voted you out, Mr.
Supervisor. So sorry we forgot to tell you about
that. It was going to happen. It was completely
an accident. That's that loophole. All right.
So loophole. Meeting notice was. to was forgotten.
Supervisor was not notified of meeting where
supervisor was voted out. And remember, the supervisor
is the is the eyes and the ears. He gets to to
look at why decisions were made. I mean, so if
a specific decision was made. While the supervisor
was forgotten to be included, there's a loophole
right there. So I'm going to mark that one up
as bright blue. I added that to supervisor. I'd
just like to know what the reasoning was. I'm
sure there's a reason for it. I'm sure the reason
wasn't just to have a loophole. So let's just...
I'd like to hear what that answer is. That can
be used a lot to circumvent stuff. Accountability.
And I am big, big into that. Very big into that.
Okay. 9 .5. Section 9 .5. No business shall be
transacted at a general meeting. unless a quorum
is present in person or by proxy when the meeting
proceeds to the business. The quorum is a majority
of the persons entitled to attend and shall include
the founder if the founder is alive and not incapacitated.
Okay, so the founder is a required quorum member
in order for business to be transacted at a general
meeting. Now, my first question was, what was
a quorum? We answered that. Quorum is a majority.
My second question is, what is business? The
foundation company's general nature of business
is holding company securities. And, okay, there
we go. That is it right there. I don't know what
that means because that was the question we had
about whether or not SIBA, Securities Investment
Business Act, was applicable. So I don't know
what that means. Let's ask. Page 11, section
9 .5. No business shall be transacted at a general
meeting. Okay, so our question is, what is business?
And what we think... it is if we reference uh
whatever that section was that we think under
section 2 .1 that it is general natural business
is holding company securities i'm just going
to say that it's going to reference that literally
and then we think what else do we think oh uh
the quorum part And that the quorum is the majority
of persons entitled to attend and shall include
the founder. That's good to know. Reference 9
.5. So these questions are getting a little bit
advanced. This is the sort of stuff that will
take attorneys quite some time to put together.
So that's all billable hours. It's all costing
stuff. So I've got to be cognizant of that. We're
at question number 30. And some of these might
require some intense... Or a lot of research.
Okay, that's probably enough. Just those two.
Go to our next one. And now we're at 31. So we'll
make business a new keyword. Because, oh, in
general, meaning is a keyword. Okay, so what
is business? Yeah, what is business? Okay, we're
now at section 96. At any general meeting of
the foundation company, unless the laws or the
foundation company's memorandum of association,
these articles or the bylaws otherwise provided,
every motion proposed shall be decided by ordinary
resolution of those present in person or by proxy
and entitled to vote. So this is what I was talking
about when I said about the accidental omission.
So what if, I mean, what if the loophole here
seems to be that the accidental omission. where
the meeting had a 9 .6 activity, which is a motion
passed by order of resolution, the supervisor
was not there to see it and did not catch it.
And because of 9 .4, that is not invalidated.
I think that's true. So let's put that, loophole
one. All right, so loophole two is... A section
9 .6 activity, which is a vote, is held, but
to any person, right? To any person. So what
if I omitted, accidentally omitted inviting the
founder? The founder was accidentally omitted
from the invite. Does the, oh, that's still there.
Is it invalidated? All right, so activity, an
ordinary resolution was passed. That seems to
be like a glaring loophole right there. All right,
so section 9 .7. A resolution in writing signed
by all persons for the time being entitled to
vote at general meetings shall be valid as effective.
As if the same had been passed at a general meeting,
the foundation company duly convened and held.
All right, we already know that one. That's good.
Section 9 .8. A general meeting may be held and
any person may participate in a meeting by means
of a conference telephone or similar communications
equipment by means of which all persons participating
in the meeting are capable of hearing each other
and such participation shall be deemed to constitute
presence in person at the meeting. So we're talking
like Zoom or Discord call. I guess even an Xspace,
right? Twitter Xspace is a similar communications
conference, which all persons participating are
capable of hearing each other. Yeah, that could
meet the intent. Okay, before we move to section
10, so that's done with section 9 .8. Before
we move to section 10. We will take a quick two
-minute break, and see you back soon. And we're
back. Back again. So now we're on section 10.
Proxies. Section 10 .1. Any person entitled to
attend and vote at a general meeting of the foundation
company may be written may be written instrument
under hand or if the appointee is a corporation
either under the corporation seal or under the
hand of an officer or attorney duly authorized,
appoint a proxy to represent at the general meeting
of the foundation company. All right, let's read
that one again. Any person entitled to attend
and vote at a general meeting of the foundation
company may, by written instrument under hand,
okay, or if the appointor is a corporation, either
under the corporation's seal or under hand of
the officer duly appointed and authorized. Point
a proxy. Okay, got it. So any person who is allowed
to vote at a general meeting may appoint a proxy
to represent themselves at the general meeting
as long as it's written. So I appoint X person
to be my proxy. That is what this is. All right.
Got to stay hydrated. Section 10 .2. The instrument
appointing a proxy may be in any usual or common
form or as otherwise acceptable to the chairman
of the meeting which the instrument is first
presented. I have not heard the word chairman
before. I missed that. Oh, it was previously
talked about. Oh, we haven't gotten there yet.
Section 11. So this is the first time. We are
seeing the word chairman. I don't know. We need
to add that person to our rectangle of confusion.
Don't talk about. Our rectangle of confusion
is. This. So let's add. Chairman. It references
the chairman. Do that. This is going to make
it a little bit messy, but we need to talk about
this person now, I guess. That looks a little
weird, but we're going to put it in there. So
chairman is apparently a part of this now. Let's
go to our questions. So what would be our question
here? It would be page 12, section 10 .2. Who
is the chairman? They aren't mentioned before.
There we go. The chairman is now a new buzzword.
Let's find out. Section 11, director's meeting.
This is fascinating, okay? Section 11 .1, except
as otherwise provided by these articles, the
directors, so you're going to have more than
one, shall meet together for the dispatch of
business. convening, adjourning, and otherwise
regulating their meetings as they think fit?
Questions arising at any meeting shall, unless
the laws or the foundation company's memorandum
of association these articles or the bylaws otherwise
provide, be decided by a majority vote of the
directors present. Each director shall have one
vote. In case of inequality of votes, meaning
a tie, the chairman of the meeting shall have
a second or casting vote. So the chairman is
the tiebreaker. So let's break this one down.
It's actually pretty easy. The directors shall
meet together for the dispatch of business convening
and adjourning or otherwise regulating their
meetings as they think fit. And questions arising
from any meeting shall be decided by a majority
vote with the chairman being the tiebreaker.
Okay. Got it. Section 11 .2. The secretary on
the written requisition of a director shall at
any time summon a meeting of the directors by
at least five days' notice, and in parentheses
says, exclusive of the day in which the notice
is served, in parentheses, and writing to every
director specifying the place, the day, and the
hour of the meeting and the general nature of
the business to be transacted unless notice is
waived by all the directors either at, before,
or after the meeting is held. That last part,
though. Shall be transacted unless notice is
waived by all directors. Okay, got it. So they
need five days notice to do a meeting. They can
do the meeting whenever else they want. Section
11 -3. The quorum necessary for the transaction
of the business of the directors may be fixed
by ordinary resolution of the foundation company,
and unless so fixed, shall be at least two of
the directors then holding office. Present in
person where two or more directors are appointed
and otherwise a quorum shall be one director.
Okay. So they just clarify what quorum was. If
there's only one director, then quorum is one
director. And if you have five directors and
you didn't specify what quorum was through ordinary
resolution, then it's two directors. Okay. Section
11 -4. Meetings. Minutes of all meetings of the
directors shall be signed by the chairman of
the meeting. For the next to CD meeting and a
copy of the minutes shall be circulated to all
directors and the secretary within 14 days after
the meeting and in any event before the next
scheduled meeting. Section 11 .5. A resolution
in writing signed by all the directors for the
time being shall be as valid and effectual as
if it had been passed at a meeting of the directors
duly convened. Okay, so they could technically
in discord convene a meeting. Oh, they could
pass a resolution on Discord if they wanted to.
They could pass it via text, like a group chat.
That's the way this reads. Section 11 .6. A meeting
of the directors may be held, and any director
may participate in a meeting by means of a telephone
conference or similar communications, like an
Xspace or Zoom. Equipment by means of which all
persons participating in the meeting are capable
of hearing each other and such participation
shall be deemed to constitute presence in person
at the meeting. Okay. Got it. Section 12. Registers.
Section 12 .1. In addition to the registers required
to be maintained under the laws, the foundation
company shall maintain a register of interested
persons at its registered office which shall
inter alia record. Look at what inter alia means.
Inter alia means among other things. So is inter
alia the same as et al? No. While both inter
alia and et al are Latin phrases used to indicate
among other things or and others respectively,
they're not exactly the same thing. Enter alia
specifically means among other things and is
used when listing a few examples from a larger
group, while et al is more commonly used to shorten
a list of people or things by saying and others.
Okay, I don't really know what that difference
is supposed to tell me, but okay, got it. Which
shall enter alia among other things record section
12 .1a, the date upon which a person first shall.
became an interested person, and upon which the
person ceased to be an interested person. The
date upon which a person first became an interested
person, and upon which the person ceased to be
an interested person. Section 12 .1b, the name
of the currently designated representative of
such interested person in the case of a corporate
member. Oh, the proxy. That's the proxy. That's
got to be section 10 what they're referring to.
Okay. Section 12 .1a. Excuse me. Section 12 .1c.
The address of the interested person in the islands
for service of notices. Okay. Section 13. Accounts.
We're getting there. Section 13 .1. The director
shall cause proper books to account to be kept
for. Section 13 .1a. All funds received or expended
or distributed by the foundation company and
the matters in respect of the receipt or expenditure
takes place. And Section 13 .1b. The assets and
liabilities of the foundation company. And proper
books of account shall not be deemed to be kept
if there are not kept such books. as are necessary
to give a true and fair view of the state of
the foundation company's affairs and to explain
its transactions such books shall be kept at
the registered office or such other place as
may be determined by special resolution of the
company special resolution is two -thirds majority
assets and liabilities of the foundation company
as was first determined with the initial members
and then accrued over time and This is me reading
into this. I'm done reading section 13 .1 right
now. And, all right, let's reread section 13
.1a. All funds received. The director shall cause
proper books of account to be kept for all funds
received or expended or distributed by the foundation
company. Okay, got that part. And the matters
in respect of which the receipt or expenditure
takes place. Oh, like a, like I guess a general.
General meeting? And the matters. I don't know
what and the matters means. Exactly. Good question
since we already have 31 of them. What does and
the matters mean? Here we go. Okay. Section 13
.2. The books of accounts shall be open at any
time in ordinary business hours to inspection.
By the founder, supervisor, and any other person
to whom a right of access has been granted under
the foundation company's memorandum of association,
these articles are the bylaws. Section 13 .3.
By notice to the foundation company, the founder
or a supervisor may call for such reports, accounts,
information, and explanations from the directors
as to the administration of the foundation company
as are described in the notice. Section 14. Auditors.
Second 14 .1. Foundation company may, shall not
be required by ordinary resolution at any time,
appoint or replace an auditor or auditors of
the foundation company. Remuneration of an auditor
shall be fixed by ordinary resolution. This is
another new one. An auditor. All right, so we
don't really know. This is more and more and
more people. Did I talk, did I have auditor?
Anywhere. Okay. In the foundation company's law,
in Schedule 2, that's where the Articles of Association
Oops, you can't see what I'm doing. There. So
in the foundation company law, Schedule 2, which
is where the model constitution is, and that's
just a template, a template association, Articles
of Association, which a foundation company is
not required to do. You're not required to abide
by this model constitution. But as we learned,
when we compare the two side -by -side and send
off 56, they are very similar. So when the foundation
company, our foundation company, Sandbox DAO,
was stood up, it used a lot of the same language
from the model constitution and Schedule 2 of
the foundation company's law on page 20 through
31. So in the article of the association, it
talks about, An auditor. At least it lists the
auditor. And. I'm willing to bet you if I were
to pull it up side by side. It would list. An
auditor. Same or similar language as this. Okay.
Good to know. I think my only question is. Same
thing as the chairman. On this time it's page
14. It's section. 14 .1. Who is the auditor?
They aren't mentioned before. Okay. Section 14
.2. Every auditor shall have a right of access
at all times and ordinary business hours to the
books of account of a foundation company and
shall be entitled to require from the directors
and officers of the foundation company such information
and explanation and access to vouchers and other
documents. as the auditor considers necessary
for the performance of the auditor's duties.
You know what? Actually, no. I just looked it
up in the Foundation Companies Law. It's not
there. Let's take a look in the Companies Act.
Let's look up the word audit. So there is a mention
of audit in the Companies Act under Section 59.
Accounts and audits. Talks about audits. Talk
about an auditor. It does. Under section 43.
Under proceedings at general meetings. Talks
about. Businesses being conducted. Something
about. Giving a report to auditors. And fixing
remuneration of auditors. So in the. Foundations
company law. It only mentions it in the template.
And the companies act. the big one which is the
big one in our break stack all right so that
would be this one here down at the bottom that
company's back there so this big one has it in
one of the sections so sections 43 100 okay so
that's where it mentions it in here in the foundation's
company law it mentions it in the schedule optional
template for a company's uh a company's Articles
of Association, which the Sandbox DAO Foundation
used that template and used a lot of it. Okay.
Section 15, winding up. All right. We're getting
close. There's only 16 sections. All right, so
winding up. Section 15 -1. The foundation company
shall be wound up if the founder delivers notice
to the foundation company at its registered office
declaring that it is to be wound up. The person
designated in the founder's notice shall be the
liquidator. Another word. But we know what the
liquidator is because we talked about the liquidator
in Sandow 56. I don't think because the liquidator
is only comes into play when they're appointed.
So I don't think we need to really talk about
that much. Okay, so the person designated in
the founder's notice shall be the liquidator,
or if no liquidator is so appointed, then the
directors or such person as they shall appoint
shall be the liquidator. The surplus access shall
be distributed to the founder or as the founder
directs. That is, okay, you know what? We first
talked about this over in the memo. And here
in section 10, we talked about if there are surplus
assets, it shall be applied or distributed under
the Articles of Association. Okay, now here is
the Articles of Association saying, the surplus
assets shall be distributed to the founder or
as the founder directs. So now we really want
to know who the founder is. Okay, so let's go
back to our question. Who is the founder? Who
be the founder? Because they are about to get,
not only do they have god mode privileges, but
they also get everything, it looks like. Where's
our founder? Founder, founder. Founder. Founder.
Founder. Alright, there we go. Oh, we didn't
ask. Who is the founder? That's two questions.
Let's stick to one question at a time. It's going
to mess up everything, won't it? Yes, it will.
Oh, you know what? I can delete this question.
And then add a new question nine over here. Yeah,
let's do that. Who is the founder? All right.
And then our reference for why this is so applicable
to us now is page 14, or just section. 15 .1
the surplus assets oh we need a reference first
the moa and which part was it section 10 shall
be applied under the articles association this
one is shall be given to the founder okay good
Stuff. We are deep diving deep into this, but
we are excavating everything. It is. There is
no. There is very, very little confusion here.
There are a lot of questions, but there's very
little confusion about what's happening now.
After we did all of these episodes together before
today. So that's episode. Send out episode 34.
standout 56 57 59 so much of this is now like
instead of 100 questions we have only 30 something
now we understand a lot more so much more okay
who is the auditor they aren't mentioned before
all right we were in here winding up section
15. we had to go back here to section nine or
to question nine to ask who the founder was and
reference how shall it be applied. And then we
need to rearrange this one so that it restarts
at 10. We are good. All right, back on track.
Section 15 .2. Members, directors, and supervisors
as such have no power or authority to wind up
the foundation company. or petition the court
to wind up the foundation company, except in
the case of insolvency or for the purposes of
bona fide reorganization intended to enable the
foundation company to carry out its objects more
efficiently. I have a feeling this is one of
the things that is undecided. Because right here
you are saying in the company that no one else
has the ability to wind up the company except
for the founder. But I see this as a point of
clarification. that may get challenged in the
court and become case law. That's a pretty broad
statement. That's a pretty restrictive statement
that no one else has the authority to wind it
up when the founder isn't mentioned in the Companies
Act and it's only mentioned as an optional template
in the foundation's company law. So you are designating
an optional person to have the ability to wind
up or liquidate. or close down the company. Something
tells me that that one is not, could be challenged.
So the question is, is how enforceable is when
founders are optional roles? That's the question
on that one. Okay. So let's read this again.
15 .2. Members, directors, and supervisors as
such have no power or authority to wind up the
foundation company or petition the court to wind
up the foundation company, except in the case
of insolvency or for the purposes of a bona fide
reorganization intended to enable the foundation
company to carry out its objects more efficiently.
So that also petition the court. I think that's
probably why I believe that it's going to get
challenged because you're restricting someone's
ability to have legal remediation. A legal remedy,
which in the US, that's a big no -no. You can't
do that. In some cases, you can, but in very,
very particular cases and the case law on that
is super shaky. So that is, I think that's probably
a point of, oh, you can't read what I'm saying.
Sorry. This right here. I think that part of
this sentence is suspect. Okay. Now we're on
question 35. Now we're in section 16. We're four
pages away. Indemnity and insurance. Now remember
when we said indemnify, you will help pay for.
Section 16 .1. In this article, section 16 .1a,
an indemnified party means each of the founder,
director, supervisors, secretary, and other officers
of the foundation company. For the time being,
and any trustee, for the time being, acting in
relation to any of the affairs of the foundation
company and their heirs, executors, administrators,
and personal representatives respectively. I
was about to add a whole bunch of people in our
rectangle of confusion, but I don't think trustee
is an actual role. I don't think trustee is an
actual role in the... And the foundation company.
I think they just mentioned as though if a trustee
somewhere else comes and says, I want, I need
to be indemnified, I guess. Okay. Section 16,
one B liabilities mean all liabilities, costs,
charges, losses, including consequential losses,
damages, fees, expenses, including legal and
other professional fees and expenses, judgments,
fines, penalties, interests, settlements, and
other amounts. including with prejudice to the
generality of the foregoing, any liabilities
in respect of or in connecting with any proceedings.
Talking about court proceedings there. Maybe
ADR. Dispute resolution. Proceedings. Maybe that.
Alternative dispute resolutions. Section 16 .1c.
Proceedings means all suits, proceedings, demands,
claims, and actions of whatsoever. whether civil,
criminal, administrative, investigative, regulatory,
or otherwise. There you go. Section 16 .1d, reference
in this article to actual fraud or willful default,
being a non -appealable finding to such effect
by a competent court in relation to the conduct
of the identified party. Section 16 .2, each
identified party shall, to the full extent permitted
by law, be identified on an after -tax basis
out of the assets of the foundation company from
and against all liabilities which the identified
party shall or may incur or sustain, provided
that no identified party shall be entitled to
identification with respect to any liability
to the extent that such liability resulted from
an act or omission that constitutes actual fraud
or will default on the part of the identified
party. All right, let's break that one down a
little bit. This is actually the definition here
of how the identified party should be treated
in 16 .2. Each identified party shall, to the
fullest extent permitted by law, be indemnified
on an after -tax basis. So after they do their
taxes. Oh, after they factor in their tax liability.
So whenever you buy shoes and you have sales
tax, the person will be indemnified, reimbursed,
after taxes, I guess. After taxes are assessed.
Of the foundation company from and against all
liabilities. Again, up here, liabilities means
all these things. which the identified party
shall or may incur or sustain. That right there
is the indemnification part. All right, so against
all liabilities which the identified party shall
or may incur or sustain. And then they have this
little asterisk here. All right, and the most
important part is constitutes actual fraud or
willful default. So if... this identification
happens and it's determined that the identify
party has committed fraud or willful default
then identify identification is is no longer
applicable all right but we're not done here
16 .2 a is by reason of an act done or admitted
to be done in connection with the business and
activities of the foundation company 16 .2b.
By reason of such person being a founder, director,
supervisor, secretary, trustee, or officer. Or
16 .2c. In or about the execution of their duty
as a founder, director, supervisor, secretary,
trustee, or officer. 16 .3. Unless the same shall
result from an act or omission that constitutes
the actual fraud or willful default by an identified
party, no identified party shall be liable or
ineligible for 16. A. The acts, receipts, neglects,
or defaults of any other identified party. 16.
3. B. Joining in any receipt for the sake of
the conformity. 16. 3. C. The solvency or honesty
of any banker or other persons with whom any
monies or securities or tokens belonging to the
foundation company may be lodged or deposited
for safety. For safe custody. 16 .3. Delta. D.
Any insufficiency of any security upon which
any monies of the foundation company may be invested.
16 .3. E. Acting on any advice or opinion given
by legal advisors to the foundation company.
That's a convenient one. Okay. That's a pretty
big loophole there. 16 -3, maybe loophole is
the wrong word. That is a pretty broad protection
right there. That's a big protection. So big,
in fact, after I read that one sentence, that
the identified party is not responsible or answerable
for any act where they receive advice or opinion
by legal advisors. So in our case, the Dow is
TTA. And depending on who the identified party
is, it could be anybody, I guess. It could be
the director. It could be supervisors. It could
be the founder, I think. I'm not sure. That's
a question right there. Good question. So they
could have unlimited indemnification so long
as they acted on the advice or opinion given
by a legal advisor. So seeing that, I'm now no
longer confused. As to why someone may or may
not rely on legal's advice so much. Because if
they do, and they're identified, they get broad
waiver of liability. That's just within the foundation
company, though. Someone can still sue them.
That's how identification kicks in. And then
section... 16 .3 e who are the indemnified parties
this section grants broad liability waiver if
legal is involved if legal was involved in the
in the action Which, who wouldn't have legal
involved in a lot of that? So, interesting, interesting.
All right. And then 16 .3F, any liabilities due
to any such cases as aforesaid? I think aforesaid
means said above us. What does aforesaid mean?
being the one previously mentioned or spoken
of. I don't know what that's supposed to mean
here in this sentence, in this list. 16 .3G,
any other liabilities when the foundation company
shall or may incur or sustain by reason of any
act done or omitted in connection with the business
and activities of the foundation company or by
reason of such person being a founder, director,
supervisor, secretary, trustee, or officer. or
in or about the execution of their duty in their
respective offices and trusts or trusts. Okay.
16 .4. To the fullest extent permitted by law,
amounts incurred by an identified party in defending
or otherwise in connection with any liability
or proceeding, whether as a party or otherwise,
shall from time to time be advanced by the foundation
company prior to a final non -appealable finding.
of a competent court that the identified party
is not entitled to be identified upon receipt
by the foundation company of an undertaking by
or on behalf of the identified party to repay
such amounts. If there shall not be, if there
shall be a final non -appealable finding of a
contempt court that the identified party is not
entitled to be identified. Holy smokes. All right.
The most important part in this whole thing is
shall from time to time be advanced by the foundation
company. Meaning the foundation company may pay
legal fees and all that stuff ahead of a court's
finding or a court's resolution or verdict. 16
.5. The identification provided by this article
shall be in addition to other, any other rights
to which an identified party may be entitled
under an agreement as a matter of law or otherwise,
both as to actions in the identified party's
capability. Oh my gosh. All right. Let me say,
let me eyeball this again. All right. I think
I'm not fully understanding this, but I think
the first part here. The identification provided
in this article shall be in addition to any other
rights to which an identified party may be entitled
under any agreement. Okay, that's the first important
part. Second important part is and shall continue
as to any identified party who has ceased to
serve in this capacity in which such identified
party became entitled to identification. So meaning
this last part means that if someone is no longer
indemnified, but at the time they did this action,
they were indemnified, they shall be treated
as having been indemnified now by the foundation
company. Okay? So if the director was indemnified
and was entitled to this indemnification five
years from now when they are sued, and it was
determined during when they did this, they were
indemnified, then five years later, the foundation
company shall Treat them as identified, so pay
for their stuff. Okay. 16 .6. No amendment, modification,
or repeal of this article or any other provision
of these articles shall in any manner terminate,
reduce, or impair the right of any past, present,
or future identified party to be identified by
the foundation company or the obligations of
the foundation company to identify any such identified
party under... and in accordance with the provisions
of this agreement, as an effect immediately prior
to such amendment, modification, or repeal with
respect to any liability arising from or relating
to matters occurring in whole or in part prior
to such amendment, modification, or repeal, regardless
of when such liability may arise or be asserted.
Jeez, that's a lot to say this first sentence.
No amendment, modification, or repeal of this
article or any other provision. shall in any
way terminate, reduce, or impair the right of
the identified party to be identified. That's
it. The rest of this is good, I guess, but legalese
that just kind of gives you your assertions and
assumptions and stuff. That's the way that reads
to me, at least. Section 16 .7. How many more?
Okay. Section 16 .7. Any amendment modification
to repeal this article or that otherwise affects
this article that limits its scope shall be prospective
only. Prospective means, I think, not permanent.
Relating to or effective in the future, likely
to come about. Yeah. So future. Not yet put into
practice. And shall not in any way affect the
limitations on the liability of identified parties
under this article. As an effect, immediately
prior to such amendment, modification, or repeal
with respect to any liability arising from or
relating to matters occurring in whole or in
part prior to such amendment, modification, or
repeal, regardless of when such liability may
arise or be asserted, provided that the identified
party became an identified party here under prior
to such amendment, modification, or repeal. Okay.
Got it. Section 16 .8. The directors, on behalf
of the financial company, may purchase and maintain
insurance for the benefit of any identified party
against any liabilities or proceedings. That
brings Bell. Secretaries are required to have
insurance, I think. Is it that or directors?
I don't remember which one. Let's take a look
here for a second. Insurance. Oops, that's the
wrong one. This one. One of them had to have
insurance. Okay. So if our director was licensed
under the DRLL, Director's Registration and Licensing
Law, they would be required to have insurance.
But if our director is not covered under by this,
then they are not required to have insurance.
But 16 .8 says they may purchase insurance. Okay.
Section 17, which is an error called the Constitution.
If you look at SIP number one, I think it's about
time we go over that. SIP number one. Okay. Down
at the bottom, we get into the Constitution.
But if you click the Constitution, it will bring
you to the bylaws. Per Cayman Islands law, not
policy, not interpretation, per the law, the
bylaws are not part of the Constitution. All
right, we went over that in Sandow 56. All right,
so we talk about the Constitution. Now let's
actually search bylaws. All right. Bylaws are
optional, but as... As specified in Section 2
of the Foundation Company's law, the Constitution
means the memo and articles of the Foundation
Company, but not its bylaws. So, where this is
called the Constitution, just know that it's
the bylaws and not the Constitution. I think
that was just an error. So, Section 17, bylaws.
Section 17 .1. Founder, by notice of the foundation
company, or the foundation company, by special
resolution, may adopt bylaws that are not inconsistent
with the laws or the memorandum of association
or those articles. Or these articles. So, okay.
May adopt bylaws. They're already optional. Per
law. K -9's law. Which are now called acts. There's
a lot of stuff that's... Different. Section 17
.2. Bylaws may relate to any aspect of the business
or affairs of the foundation company or any of
the duties or powers of the directors or the
delegates or others who have duties or powers
under these articles, including the way of achieving
the foundation company's objects. Remember the
objects were in the very, very, very beginning
of this whole podcast episode, which is the whole
reason why this thing exists. All right, continuing
on. The benefiting of beneficiaries. the investment,
management, and protection of the foundation
company's assets, the remuneration of directors
and their delegates, the delegation of the director's
duties and powers, the supervision of the management
of the foundation company, and the appointment
of the advisors and other service providers.
Okay, that's a mouthful, but that's actually
a pretty important one. So this is saying that
the bylaws has the ability to expand on almost
everything. There's a lot. There's not a lot
that this doesn't include. In my opinion. I mean,
you got the objects, which is everything the
foundation company does. Beneficiaries. The investments.
The management. The protection of the assets.
The remuneration, which is all of the compensations.
Payments. Of the directors and delegates. And
their delegates. Oh, those are the proxies. And
their delegates and proxies. Duties and powers.
Supervision. appointment of advisors and other
service providers. This is almost everything
right here in this one subtle, unassuming paragraph
at the end. So the Constitution is only eight
pages, so we'll get through that today. Eight
pages is not a lot. 17 .3, the bylaws may be
varied or revoked by the founder by notice to
the foundation company or by special resolution
of the foundation company. There he goes again,
that founder. He's able to do anything. 17 .4.
The adoption or variation of bylaws shall not
render any director or other person liable for
prior conduct. Huh. It's like almost an indemnification
thing going on there. The adoption or variation
of bylaws shall not render any director or...
Or other person liable for prior conduct. Oh,
that's just a retroactive statement. Saying that
the new, whatever you, if on Monday you have
something that's not saying that you can get
in trouble for signing something in red ink,
but then on Tuesday you adopt a bylaw variation
that says you will get in trouble if you use
red ink. The person who signed the thing in red
ink on Monday is not going to get in trouble.
on Tuesday for the new variation saying that
red ink now is bad to sign with. That's what
this is saying. It's called a retroactive clause,
okay? This is not retroactive. I think that's
part of jurisprudence across the world. I might
be using that term wrong, but basically like
law theory that, I mean, you can't be helping.
Never mind. We're going to keep going. 17 .5.
No third party dealing in good faith with the
foundation company need be concerned with the
bylaws or their observance. So there we have
it. This just puts into place what is already
part of the Cayman Islands law. All right, let's
keep going. Almost there. Section 18, alteration
of the memorandum and articles. Section 18 .1.
The memorandum of association and these articles
may be altered in accordance with clause 11 of
the memorandum of association. And no other alteration
may be made which is in any way inconsistent
with clause 6, 10, 11 of the Memorandum of Association.
Refer back to what I said when we first went
over this. It's the same thing under the Memorandum
of Association. We already talked about this
one. Same thing. Okay. Section 19. Financial
year end. 19 .1. The company's financial year
end will be 31 December or such other date as
the directors determine. Are we done? This was
dated 20 November 2023. Signed by International
Corporation Services Limited, ICSL. Remember,
ICSL is being run. The principal agent is, right,
I don't want to misspeak. Second, ICSL. Yeah,
the key principal. For ICSL is Michael Alberga,
who is a partner of TTA, who is the legal counsel
SIP2 hires into Sandbox Foundation. All right,
just a reminder. So this article of association
is signed by ICSL, by this authorized signatory
person, and witnessed by this person. Odds are
this person is a government official, I think.
It's a witness though, maybe not. And then this
person is an authorized signatory of ICSL. Okay.
The end of the articles. Holy smokes, that took
forever. Oh my gosh. Oh Lord. All right. We do
have one final question. Let's go back to that
really, really important paragraph. Let's make
a question out of this because I was not expecting.
And when I first read this, it wasn't obvious
to me that that was so powerful. This seems to...
So we're talking about 17 .2, this broad, broad
thing where bylaws can do anything. This seems
to encompass everything about the TSB DAO Foundation.
Does this exclude... Does this... Section exclude
anything. So as in, is there something the bylaws
can't touch? There. So we're going to highlight
our buzzwords. And there's our 36th question.
Okay. All right. That was our, that was our articles
of association as part of the constitution. Okay.
So there's our agenda item down there in the
bottom. Done. Next is the bylaws. It's only eight
pages. So, I mean, we're already four and a half
hours into this. We're going to keep going. I
can't believe four hours, four hours. All right,
next up are the buy loss. We are going to take
a quick two -minute break. Be right back. So,
bylaws, not the Constitution, but is called the
Constitution, I think, on accident. And in SIP
number one and SIP number two, I think, right?
It's listed on both. Yeah. So SIP number one
and two lists the bylaws. Again, they call it
the Constitution. It is not the Constitution.
So down here, oops, you can't see what I'm doing.
Down here, Constitution. That is the bylaws mistakenly
named. So, anyways, the Constitution, as we just
learned, no, that's the wrong word. I just did
it myself. The bylaws, as we just learned, augment,
enhance, and give further guidance for how...
foundation company is run and per our articles
association bylaws may relate to almost anything
but the the key thing here to know about the
bylaws is no third party outside of the foundation
company is required to be concerned with the
bylaws that's both written here and it's also
part of cayman is law so that's a big one So
that was the articles. Now let's roll right into
the Constitution, which is the bylaws, okay?
Not the Constitution, just the bylaws, right?
So call it that. Adopted 28 May 2024, which is
the day that the DAO was born, was launched.
What is this? These were launched, oh, this was
in November, right? So November 2023 is when
this came about. And November 2023, same thing
with Memo. But for the Constitution, it has a
date of 28 May. So this is clearly put together
by the DAO admin team. You can just kind of tell
by the way it's got the header on it and all
that stuff. Good odds are the DAO admin team
had a role to play here. So, good news is it's
only eight pages. All right. And before we get
into this, let's talk a little bit about the
SIP. The SIP where I'm pretty sure the compensation,
which we've been calling remuneration this whole
time, is not in here. But it does reference some
things that we maybe need to talk about. So in
SIP 1, which is introduced in the sandbox DAO.
The reason why I think they connect it to the
bylaws is because the bylaws are going to talk
a lot about how the sandbox DAO works, whereas
the articles and the memos that we just spent
the past four hours reading is related to the
sandbox DAO, the sandbox foundation company.
So the legal separate entity is separate from
the actual DAO, like the voting DAO. That's why
they call it the DAO wrapper. We went over that
in Sandow 58 with Ernest Lee, who is a practicing
U .S. attorney. So this SIP 1 introduced the
sandbox DAO, which was the concept of what it
is we actually do every day, the DAOing part,
the voting, all that. This SIP, Sandbox Improvement
Proposal, introduces the sandbox decentralized
autonomous organization and proposes the approval
of its constitution, special counsel. which was
the initial members advisory board, which is
what the initial members communication channels,
which is discourse code of conduct. I actually
don't know about that one. And then administrative
resources, but of conduct, get a code of conduct
before. Oh, we do have a code of conduct. Oh,
I didn't even know that. Whoops. Okay. So the
special counsel has a code of conduct. Got it.
Special counsel, code of conduct, and then a
general code of conduct. Whoops, I overlooked
that one. So those approved all these things
at once. And again, 89 % approval rating. So
it passed. And then here in the Constitution,
it says, pursuant to the Constitution, holders
of sand and land tokens may vote that. Okay.
Why? Empowering a global community of creators
and gamers. This is a SIP. Sandbox Improvement
Proposal number one. Very first thing we voted
on. Well, technically that's not true because
it got resubmitted, but we'll just move past
that. The sandboxes DAO envisions a decentralized,
innovative, and inclusive virtual universe. How?
The DAO will act as a decentralized community
with the power to propose and vote on key matters
related to its values. All right, so we're reviewing
all of this just so we can set the stage for
the Constitution. The bylaws, the bylaws, not
the Constitution, the bylaws. Darn it, I did
it again. And its values and the ecosystem associated
with the Sandbox Metaverse. The DAO will be supported
by the Sandbox Foundation, CSIP2. So we just
went over all of that. That was everything we
just spent the past four and a half hours on.
Which... As a Cayman Foundation, we'll provide
the legal structure, tools, and resources necessary
to affect the DAO community's decisions. See
how this is coming together? You've got DAO Foundation,
which was stood up as a legal structure to wrap,
protect the DAO itself. Okay, so that was SIP
2. And SIP 1 is the DAO itself, all the little
stuff that's going to happen in the middle, all
the voting that we do. Okay, so when? Intends
to exist in perpetuity, meaning forever. Who?
The authors of the SIP are Arsaccio, which is
the company founded by our current DAO administrator,
Cyril. And SIP details, so we go into all sorts
of stuff here. Set the rules, the roles of the...
The DAO bylaws describes its visions, values,
governance framework, and roles of the special
counsel and advisory board. Let's cheat just
a little bit. Okay, so they're not named in here.
So we will continue on reading because two and
two together will equal four here. So the description
are the sandbox style bylaws. Then it talks about
the election. In accordance with the bylaws,
the style special counsel is hereby established.
The initial members are approved and will terminate
as of December 31st, 2025. So that is nine months
from now. And the initial members are Yat Suu,
chairman and Amoka Browns, Sebastian Bourget,
the chief operating officer and co -founder of
the Sandbox, Shannon Snow, chief operating officer
of World of Women, Jean -Michel Payoun, the co
-founder of Grow Capital, which is also, he also
was CEO of Ledger for a while, Frederic Montagnon,
which is the chairman of Ariany. Ariany. Then
you have the election of the initial advisory
board, which in accordance with the Constitution,
it's hereby established to serve as cultural
ambassadors and strategic advisors, whereas the
special counsel was established to review and
advise on SIPs in alignment with the DAO's vision
and values and code of conduct. That's why you
get the negative, neutral, or positive recommendation
from the special counsel. Fun fact. SIP number,
I want to make sure I get it right. Fun fact,
SIP number 21 was my SIP. Okay, that was the
one where you can get resolution options for
like widescreen and other than the normal stuff.
And also to resize your window options, which
right now you can't. It started with a negative.
Okay, started with a negative. By no means was
I the first negative. I think I was maybe the
fifth or sixth SIP to receive a negative recommendation
from the council. But I am the first. SIP number
21 is the first SIP to pass with a negative recommendation.
There is an unofficial council recommendation
negative club. it actually doesn't we don't really
organize or talk to each other at all it's just
there is you know there is a group of sips who
have negative and we don't again we don't organize
we don't talk to each other but it is it is quite
funny that we are a group of sip authors who
have received negative recommendation i am the
only one so far that has gotten a yes and you
can see it was resubmitted because it got a it
it didn't reach quorum here 160, 136%. It didn't
reach quorum as I think it was SIP number 14.
But I resubmitted it because after we started
getting the delegates, I was much more confident
we could reach quorum with the yes vote. And
we did. So that only happened earlier last month
in February. Anyways, go back to SIP number one.
So the election of the initial advisory board,
their cultural advisors and strategic advisors.
And they also will terminate as of December 31st,
2025. They are Mia Bao, founder of Beat Crypto
and Dow Base. And we interviewed her. SIP number.
No, SIP. It was episode number 14. Sandow 14.
We interviewed Mia Bao. Advisory board. Okay.
Also. Anthony Chow, co -founder and CEO of Court
Hero. Loretta Chen, Dr. Loretta Chen, co -founder
and CEO of Smobler Studios. And she was episode
10, Dr. Loretta Chen, advisory board member.
Okay. Then there was also Zaf Chow, CCO of Artifact
Labs, also used to be part of Anna Wilke Rams.
Samuel Choi, general manager of Bliss Concepts
Limited. I forget. Forgive me. They are Samuel
Choi's general manager of a very, very popular.
Oh, there it is. McDull. Very, very popular thing.
I don't exactly know what it is, but like McDull.
I've seen posters of it on pictures. In Hong
Kong, I've never been to Hong Kong, but I've
seen pictures of Hong Kong where McDull is here.
It's like, I guess, a cartoon. But general manager
of this, McDull in Hong Kong. So that seemed
like kind of a big deal. And then there's also
Ina Moja, CEO of Code Green. She is behind one
of, she's a musician, a singer, a successful
one then, and also has spoken quite a bit at
the United Nations and sang. recently sang the
national anthem at the at the olympics can't
remember which national anthem it was apologies
ina and also she's really big into the great
green wall which is the great green wall in africa
right it's a big initiative to increase the amount
of arable land right what's arable again define
that for me Used or suitable for growing crops.
Right? So it's this big, like, horizontal stretch
of land. Here. See it? That goes right across
the top of Africa. So they're trying to make
that more inhabitable. Or suitable. Suitable.
Okay. Then you have Matthias Vivian, who is co
-founder and CEO of Hermit Crab Studios. He is
also a former professional footballer, so soccer,
for those of you who are not up on football,
right? And I tried very hard to interview everybody,
right? So I've contacted all of them, both them
and the special counsel. I've contacted them
all multiple times to try and get interviews.
The only ones I was able to secure was Sébastien
Bourget, which was... Episode number eight. Dr.
Loretta Chen, which is episode number 10. Mia
Bao, which is episode 14. And we were, we spoke
to, we spoke to one of the managers, one of the,
yeah, one of the managers, episode 11. At Hermit
Crab Studio, which is what Mateus Vivian is CEO
of. And I really enjoyed that one. That was great.
Loved it. So that right there. Hermit Crab Studio.
Okay. So those are the people. And the reason
why I'm listing them out here is because they're
not listed in the Constitution. although they
are described there. So they were, when this
SIP was, what ended in July 13th, I'm sorry,
June, June 13th, 2024, they were elected into
office and they were to remain in office until
December 31st, 2025. Okay, so communication channels,
here it talks about exactly what we already knew,
the website, right, the DAOs hub, so sandboxdao
.com, discussion forum, which is discourse, The
voting platform, which is snapshot. So this is
called the tech stack. So it approved the tech
stack. It also approved the code of conduct,
which there's that general one here. And there's
a special code of conduct for just this special
counsel. Special code of conduct for special
counsel. A lot of specials. Spelled throughout
commit to serving with integrity, impartiality,
adhere to highest ethical standard. Bye -bye
the general COC. Disclose any conflict of interest.
Maintain confidentiality. Strive for resolution
with disputes. And maintain active, transparent
communication. Cool. Administrative resources.
Now, let's talk. Let's see if we have any of
this in here. Resources. Okay. So, not really.
So, we're going to keep on talking. Because this
seems to be like an expansion of the bylaws almost.
So, for administrative resources, they will engage.
TSB Gaming Limited. So if you don't remember,
when I say the Sandbox Game Company, as we explained
in episode 34, right? Episode 34, Birth of the
DAO. Okay? When we went through all of this,
here, this whole thing, at the very end, when
we got past ApeCoinDAO, Oh, way past that. Almost,
almost. Here. Okay. We got past the ApeCoin DAO.
We talked about how Animoca Brands was connected
to some of this. And you think that the Sandbox
Game Company is owned by Animoca Brands. It is,
but not exactly. It is owned by... Animoca Brands
owns Bacasable, which, I didn't know this, is
French for sandbox. So... That's the matter right
there. So Animoca Brands, which is based out
of Hong Kong, Virgin Islands, can't really tell,
owns Bagasable Global Limited, which is based
out of Malta. Bagasable Global Limited owns TSB
Gaming Limited, Sandbox Game Limited. And they
used to be based out of Paris, but they are now
based out of Malta. And again, just to show you
all, this was all publicly available. You can
go to this website now. Malta's business registry
and see that it's owned, who it's owned by. And
what you do is you go down to share capital.
And if you go down to share capital, you'll see
Bacasable Global Limited owns 452 ,000 shares,
which I don't see any other shareholders. So
I guess I interpreted that as owned by. Okay.
So. Baca Sable Global Limited owns TSB Gaming
Limited. That is the Sandbox Game Company. So
that's what I mean when I say that. Okay. Where
were we going with that? We were talking about
here, TSB Gaming Limited, right? The Sandbox
Foundation will engage TSB Limited. So the Sandbox
DAO Foundation, one separate entity in the Gaming
Islands, will engage the Sandbox Gaming Limited,
a separate... separate entity in Malta to provide
support services either directly through its
affiliates to affect decisions of the Sandbox
DAO. These services include but not limited to
software development, finance, that's a big one.
We've been getting about a $15 million sand endowment
from the Sandbox Gaming Limited and it's to stand
up. I used to cover that a lot in my Sandbox
DAO checkbook and the... The checkbook and the...
How can I forget that? Give me a second. Sandbox
DAO. Checkbook. And the scoreboard. Right. Right,
of course. And I used to cover that every single
episode. But... I haven't been able to keep up
with it as of late. And... Yeah, it looks like
this. So I haven't been able to keep up with
it a little bit. But here's a checkbook where
you saw... SIP number three, that was the SIP
where we received 15 .5 million sand. So that
was SIP number three. And that was in June. And
then we got, we had SIP 15 .5 million sand across
these categories at the top, these nine categories.
And we're about to get another one here very
soon. It should be SIP number 23 or 24. So I
haven't updated it since SIP 17. ever since Zendaya
podcast, except it did not pass, so I just kind
of let that one go. But anyways, and then the
scoreboard kept track of what was approved, closed,
submitted, withdrawn, not approved, all that.
It was very useful for what I needed it for.
Anyways, in addition, the Sandbox Foundation
will engage Arsaccio to manage the DAO's governance
process, as we learned with Hervé. He was a DAO
delegate interview. Must have been the 40s, I
think. Sandow 40 -something. All right, there
we go. Hervé was episode 44. Hervé revealed that
he also had a little bit to do with the founding
of the Sandbox DAO. He did some early, early
advice. Gave some early advice to... Seb and
I think Arthur, the two co -founders of Sandbox.
So that was cool. That was really cool to hear.
All right, so rationale and benefit. These services
are intended to assist the DAO during its initial
rollout and may be reassessed in November 2024.
That's gone to pass, so it's been reassessed
and it's continued. Together, we are not just
building a platform, but a legacy, okay? Risk
analysis. We recognize the complexities expected
to involve a time. And that has definitely happened.
A lot of evolution over time. And the arrival
of Kunta with all of the increased transparency
that he has been able to achieve has definitely
accelerated that evolution. And we're very grateful.
I'm very grateful. I love it. Implementation
plan. May through November. Phase one and two,
which was. curate SIPs, all that stuff. And after
November 24, 2024, which we're now in phase three,
as the Dow evolves, it is expected the constitution,
the bylaws again, bylaws, will change to reflect
most effectively the voices of all the community,
including by adjustments to reduce disparities
in voting power. The role of the administrators
will change and the community will have even
more power to propose and vote on SIPs. So they
don't define when that's going to happen, but
they have talked frequently about that on spaces,
on discourse, as things evolve. And the basically
boils down to, they will give that power, even
more power, when they believe the time is right
and the community can handle it. Okay, so resources
required, special member compensation, that's
described in the bylaws. Compensation for admin
team, I think it is, I'm not sure. And then legal
review. And then monitor metrics. So different
metrics of percentage of landholders to participate
in at least one vote, percentage of daily active
gamers and creators to participate in at least
one vote, percentage of voters joined the Snapshot
space, which had a big, huge increase in Alpha
Season 4. A lot of new voters came to Snapshot.
So that was good. And now here we are. The Constitution.
Anything else we need to go over before we hit
that? I think we hit it. Then we hit everything
we needed to that was not in the bylaws, but
it makes the bylaws more easy. In the same way
that Sandow 56 was the reading of all the Cayman
Islands laws, SIP 1 is helping us to read the
Constitution next. All right, here we go. In
the beginning. This constitution describes the
governance framework for the sandbox DAO, which
represents the global community engaged in the
sandbox metaverse. Section one, visions and values.
And SIP one mentions this. One community, many
parts. We are a metaverse, a mixture of games,
communities, and interactive experiences that
bridges culture, art, fashion, music, and entertainment.
All people and ideas are welcome here. We meld
diverse cultures and people from around the world
to build meaningful connections. The next vision,
working with impact. We are one community actively
working together to build a better world. Everything
we do derives from purpose, from the experiences
we build to the interactions we have. The next
vision is empowerment. In our community, every
voice matters. Your participation in our ecosystem.
Your digital ownership allows you to shape the
future of the sandbox. We use our authority for
good, ensuring that we make decisions as a collective
that empower everyone in your community to realize
their potential. The next vision. Transparency.
Transparency is a cornerstone of our operations.
We believe in fostering an open and inclusive
environment where decisions, information, and
processes are shared openly with our community.
Our economic policies are designed to be fair
and transparent, and our decentralized approach
ensures equitable governance. We actively involve
our community in the decision -making process,
empowering them to shape the direction of our
platform. Through transparency, we strive to
build trust and maintain an engaged and informed
community every step of the way. So fun fact,
the Sandbox, Sandow, so this podcast you were
listening to on our 60th episode. Most of our
episodes have been geared toward this transparency
piece, trying to establish more transparency
and obtain more clarity on what's happening.
Because at the very beginning, it wasn't quite
so clear and transparent what was happening.
And Digging in the Sand podcast episodes one
and two really helped communicate why that was.
And I am okay with that. I get it. I understand
why they unveiled things the way they did. And
if you want to know more about that, I highly
recommend it because it kind of summarizes the
past eight or nine months that we've been a DAO.
And it was a reaction to... Which one was it?
I did a reaction to... Digging in the Sand. There
it is. Episodes 50 and 52. So not that long ago.
Only a few months ago. Transparency Has Come,
A Reaction to Sandow Podcast, Episode 1. And
I did Transparency Continues, Reaction to Sandow
Podcast, Taking the Sand, Episode 2. And then
Episode 53 was A Reaction to Sandow Podcast,
Episodes 3 and 4. All right, so check out Sandow
50. 52 and 53, and you'll get a summary of how
things happened in the months leading up to Digging
in the Sand podcast. And my reaction to everything
that they talk about, which was awesome. I loved
Digging in the Sand and how Kunta and Cyril talked
through the transparency of everything. So there's
a reason why it says transparency has come for
episode 50. in November and the DAO launched
in May. There's a very good reason why I named
it that. And it wasn't to say that anyone did
anything bad. I understand why, but until November,
I didn't understand. A lot of us didn't understand.
And that's just kind of how the way things went
when it came to the particulars of what the DAO
admin team was focusing on, their priorities,
and trying to get the biggest bang for their
buck in creating a healthy DAO. Water under the
bridge. No harm, no foul now. And let's get back
to our Constitution. Check out 50, 52, and 53.
I highly recommend it. Okay. Back again. Okay.
So we are on the bylaws. Section 2 of the bylaws.
The Sandbox Improvement Proposals. SIPs. Okay.
What is a SIP? Actually, let's go over the headers
first. So the headers of section two is, they're
not numbered, so I'm just going to go through
it as best I can. What is a SIP? Submitting a
SIP. Conflicting SIPs. All right, and that's
it. All right, so the first section, a first
subsection of section two. What is a SIP? A sandbox
improvement proposal or SIP is a proposal aiming
at engaging the community in a mixture of games,
interactive experiences that bridges culture,
art, fashion, music, and entertainment. but also
challenges slash improves on the mechanics of
the DAO itself. This may include financial SIPs
involving a proposed allocation of digital assets
from the Sandbox Foundation's treasury. Okay,
so that was SIP number three. We got 15 .5 million
sand, and it'll be at the end of this month where
we get another batch. Next also may include ecosystem
non -financial SIPs that recommend changes or
enhancements to the Sandbox Metaverse platform.
So I showed you earlier SIP number... 22, my
SIP, the resolution options and window resizing.
That one is an example of this ecosystem non
-financial SIP. It was a recommended feature
change. All right, and then the third thing that
may include is a governance SIP that proposed
changes to the Sandbox DAOs or the Sandbox Foundation's
governing documents and processes. Ever since...
We had a big shift in the way the DAO was approached
in October. That was episode number... When was
that? So episode number... 33. Episode number
33, reaction to the DAO Medium article. That
was the precursor to the big change that happened
in later October. Okay, so then episode 35...
It's the new SIP process. That's when the change
occurred. A lot of changes happened there. A
lot of changes happened in October. And one of
the things that happened was all of the governance
SIPs, things that they consider to be governance
SIPs, I think they had a different word for it.
What is it? Let's take a look. So as you go,
scroll down. So scroll down. Progressive decentralization.
Here we go. Here we go. DAO -centric SIPs. That's
what they called it. So if it was a DAO -centric
SIP, which is basically what is described here
as a governance SIP in the bylaws, then it was
no longer allowed to be a SIP. You had to do
it through a features request on the DAO's forum
through discourse. So that has been the case
since October. They've been doing that. So there
you go. Governance SIPs that propose changes
to the Sandbox DAOs or Sandbox Foundation's governing
documents and processes. Okay. And then submitting
a SIP. SIP must be aligned with the Sandbox DAO's
vision and values as set forth in this Constitution,
adhere to the Code of Conduct posted on the Sandbox
DAO's website, and follow the SIP template available
on the Sandbox DAO's official website. SIP submissions
and approvals will adhere to the following workflow.
Step one, initial submission. Step two, project
management review. Step three, moderator review.
Step four, community review. Step five, special
counsel review. Step six, voting. Step seven,
implementation. That changed in November. Okay,
so as a reminder, that was, I mentioned, that
was here. episode number 33, Sandow 33, and Sandow
35. And let me show you what that was. And so
here's a little primer, a little reminder of
what it was. In episode 35, we went over the
SIP process, which was the old one that they
originally started off with May. It was a five
-step process, even though this is seven. Here
it says seven. When you count it out, it's really
five steps. And five steps, but then the new
process in October increased that to eight. And
so it looked, the flow chart used to look like
that. And I submitted maybe eight steps at this
point. So I've seen this, I've done this a lot.
So it's really, this is a process what was in
May. And then this is the new process in October
where... It got a little bit lengthier and there's
a little bit more review stuff going on. So that
was episode 35. All right. So step one was initial
submission. Submit SIP to the administrators
engaged by the Sandbox Foundation for the instructions
on the Sandbox Dials website. I have a feeling
all these steps were amended and the bylaws were
amended after October. This is May, so maybe
we should ask for the October version. or whatever
the latest version is. All right, that was step
one. Step two, project management review. Simuc
style project management team to engage with
the author to review and help curate the proposal.
Step three, moderator review. The administrators
review the SIP for its compliance with the requirements
above. If accepted at the administrator's discretion,
the SIP will be posted to discourse. Step four,
community review. Community will have 14 days
to review and discuss the SIP on discourse. Step
five, special counsel review. Concurrently with
the community review, the special counsel will
review the SIP and publish its recommendation
in accordance with the process set forth in Section
4 below. Step 6. Upon close of the community
review period, the administrators will publish
the SIP to Snapshot for voting pursuant to Section
3 below. Section 7. Implementation. If approved,
the SIP will be referred to the Sandbox Foundation
and the administrators for implementation. All
right, as I mentioned, that process has changed,
changed in October. So now SIP1, you submit your
SIP to the ideas forum, subforum. And then whenever
the DAO admin team believes that that is ready
or it's received enough support, they will invite
you to submit your SIP via a form. Then the DAO
admin team reviews that. You go through a bit
of, of curation there. This special counsel recommends
it or reviews it and recommends. Then it goes
through a review and refine process. And then
it goes to SIP public discussion in the SIP ideas.
I'm sorry, in the active SIP. And then it goes
to the snapshot for 14 days. And then it gets
implemented. So that's the new. And if any time
it gets rejected, you have to wait three months
for a resubmittal. That's the new process. So
conflicting SIPs. If a SIP directly conflicts
with another SIP that is currently up for a vote,
the SIP posted a second time will not be put
up for a vote until a decision is made on the
earlier SIP to avoid approval of opposing requirements.
So I'm just reading straight from the bylaws.
To avoid wasting community resources, a SIP that
directly conflicts... conflicts with a previously
approved SIP cannot go to vote until three months
after the previously approved SIP has been implemented.
Okay? Now we move on from Section 2 to Section
3. Section 3 is voting. Criteria for membership.
It's only needed to have sand and or land in
your wallet. And Kunta says this all the time.
If you have sand, if you have land, you are already
a DAO member. Holders of sand and land tokens
may cast votes based on their holdings of sand
or land as follows. One sand equals one vote.
One land equals 4 ,500 votes. I have a little
helpful thing. I'm going to show this. I haven't
shown this in quite a while. You know, it's still
active. So this right here. One sand equals one
voting power. One land equals 4 ,500. And this
was an early, early version of what I am doing
now, but here we go. And so some extended knowledge
there is that, so 30 million, there's 30 million
total supply. So 30 million times one is a maximum
of 30 million voting power. Oh, that doesn't
sound right. Hold on, just give me a second.
Look up CoinGecko. What, 30 million? I'm going
to take a look at CoinGecko for a second. Market
cap is that... Blah, blah, blah, blah. 3 billion
is the total supply. That sounded... I thought
that sounded really, really low. So here. Total
supply is 3 billion. So let's update this slide
even though I barely show it. So three billion
is... Maybe I did it because of what the total
circulating supply was. No, two billion. Okay.
I'm not sure where I got 30 million from. Okay,
let's go back. So one sand equals one voting
power. There is three billion max supply. Should
have done that. Yep. 3 billion max supply. So
that's 3 billion voting power up for grabs. I
think the sandbox has quite a lot. I think it's
27 million. Probably way more than that. One
land equals 4 ,500 voting power. There's a max
of 166 ,464 ,000 lands. And at 4 ,500 voting
power, that's 749 million voting power. Okay.
So my bad, that calculation is wrong. So 3 billion
plus 749 million equals 3 .749 billion voting
power. Yeah. Good correction on that one. All
right. So the voting process. Each SIP requires
30 million quorum. Oh, that's probably why I
did that. Okay. So each SIP requires 30 million
quorum, which is 1 % of the 3 billion sand max
supply. So that's how we get 30 million. Okay.
Each SIP requires greater than 50 % majority
yes vote to pass. Okay. Let's take a look real
fast at our current SIP. Current SIP we have
voting on is Women in Tech Global Summit. And
I interviewed Ayumi just this past week. So episode
58, a week or two ago, interviewed Ayumi for
Women in Tech. Take a look at that. That is currently
one of the, that is currently what we are voting
on now. And let's take a look at what it is.
So yes, 18 .58%. And no, 17 .26%. And so if it
says majority yes, then it will pass. Just because
it says majority abstain doesn't mean it's going
to decline. So maybe I do need to update. Let's
update this slide again. Make it very accurate.
Okay, so we've got each tip requires a majority
yes vote to pass that. There. That makes sense.
So in this case, if it concludes in three days
and the yes vote still has 18%, even though the
sandbox wallet accidentally voted and voted by
mistake with the wrong wallet, so they changed
it to abstain, even though that's happened, it
will still carry the day. The yes vote will.
Okay, let's go back to Constitution. All right,
and voting. Voting will take place via Snapshot
and or Sandbox .website. So that's this here,
Snapshot, or the Sandbox .website, which is up
here, VotingSips. And I did a full review on
the website. I think it was... When we reviewed
the new... When we reviewed the new... I'm pretty
sure it was when we did the new SIP process.
I think that's when I did the review of the website
there. Okay. All right, we're continuing with
our reading of the bylaws. But it will take place
via Snapshot and or the Sandbox .website. New
SIP that requires... Required guidelines will
be launched in batches every other Wednesday
at 9 p .m. CET, which is Paris time, and will
be closing 14 days later at 9 p .m. CET. Holders
of Sand and Orlan will have 14 days from the
close of the community review period set forth
in Section 2 to cast their vote. The voting opens
immediately upon launch. The voting options for
a live SIP are determined at SIP creation. To
prevent Sibyl attacks... I don't remember what
that is. What is a Sibyl attack? Sybil attack
is a cyber security attack where an attacker
creates multiple fake identities to gain control
of the network. The attacker uses these fake
identities, or Sybils, to undermine the network's
authority and gain access to sensitive information.
Okay. Picture of that. Oh. Gotcha. Right on.
We require, so to prevent Sibyl attacks, we require
a minimum of five sand or one land to be able
to vote. Quorum, except as provided below, a
SIP may be approved by a majority vote in favor
with a minimum of 1 % of outstanding sand token
supply participating. So that's the 30 million.
So 1 billion times 1%, that's 30 million. Any
SIP proposing to amend the sandbox style constitution
may be approved. only by a two -thirds majority
vote in favor of the minimum of 5 % of the outstanding
SAND token participating. Ooh. Okay, I forgot
about that one. So let's modify our little slide.
Each constitutional SIP requires 5%. So 5 % billion.
Sand. Max supply. Is. 300 million. No it's not.
Hold on. I did not math that properly. 150 million.
Wow. That's a lot. We have never reached that.
There. Let's make it like that. That way it's
still. That works. Okay. Any SIP proposing to
amend, maybe, okay, good. Section four, special
counsel. Purpose. Special counsel exists to review
and advise on SIPs in alignment with the sandbox
DAOs vision and values and code of conduct. Role
and responsibilities. Role of the special counsel
is to review and make recommendation on each
SIP as follows. Option one, veto. Option two,
favorable recommendation. Option three, negative
recommendation. Option four, mutual recommendation.
So option one, veto. The special counsel may
veto a SIP only for one of the following reasons.
The SIP does not comply with the DAO's vision
and values, violates the code of conduct, and
or involves an action in violation of applicable
laws. The SIP is redundant with another existing
SIP and has been implemented or is proposed and
is pending a vote of the DAO. Or the SIP is a
conflicting SIP as described in section two.
And section two was the sandbox approval proposals.
Okay. Option two, favorable recommendation. The
special counsel determines that the SIP is in
the interest of the DAO community and recommends
a vote in favor. Option three, negative recommendation.
Special counsel determines the SIP is not in
the interest of the DAO community and recommends
a vote against the SIP. Option four, neutral
recommendation. The special counsel makes no
determination in favor of or against the SIP
and issues a neutral recommendation. Voting and
accountability. A minimum of three members is
required to vote on any special council recommendation.
Is that why one of them recently came through
without a recommendation at all? That might be
why. I noticed that for the first time. It's
not applicable. All right, next. The special
council recommendation shall be based on the
majority vote of special members participating
in such a vote. Next. Each special counsel recommendation
will be unsigned. Next, special counsel may veto
a SIP only if at least three members vote in
favor of such veto. Any veto must be accompanied
by a public statement of the special counsel
explaining the rationale behind the veto. Membership.
Special counsel shall be composed of five members.
Candidates may be proposed by SIP to elected
pursuant to the procedure set forth in Section
3. Each proposed candidate must One, own SIP
and or LAN. Two, submit public position paper
outlining their qualifications and goals for
the sandbox DAO. And three, pass a background
check or similar compliance review to confirm
compliance with Cayman Islands and other applicable
laws. In the event of a vacancy, the administrators
will, as soon as practicable, call for a SIP
to replace the removed or departed special council
member. Until a replacement is elected. The seat
vacated by the removed or departed member shall
remain empty. What's up, Yuma? Hey, in the chat.
Thanks for stopping by. I'm still going five
and a half hours later. We're almost done, though.
Almost there. All right, next up. The next section
is compensation. Here we go. If I have a question,
it might be here. Let's get back to our... Bylaws
questions. Compensation. Special council members
may be compensated for their services. The compensation
for the initial special council members will
be $110 ,000 per year and per member. The compensation
for special council members may be changed by
a SIP approved pursuant to Section 3. Section
3. Oh, the voting process? Okay. Got it. Do we
have any questions about this? I feel like we
should have a question here. Does... Alright,
this is... Page 6. So far, no questions except
maybe here. Page 6, section... 4? So what's the
question? $100 ,000 stand per year and per member.
I don't know if we have a question, but I want
to reference the fact that this is there. Sometimes
people forget, and sometimes I forget where it
is. All right, term and removal. Except for the
initial members of the special council whose
term shall commence upon approval of the first
SIP, the sandbox DAO, and will end December 31st,
2025, each member of the special council shall
serve... A term of one year, unless early removed
as provided for below. Members may be reelected
but may not serve more than three consecutive
terms. I wonder why that is. Why three consecutive
terms? Is it kind of like we don't want people
to get too comfy or if they find a way to gain
the system that they're going to continue to
be on a special council for life? Maybe. Okay.
Next bullet point, a special council member may
be removed and replaced before the end of the
member's term pursuant to an approved SIP. Next
point, a special council member may also be removed
if they are determined by a vote of the other
four special council members to have breached
the code of conduct listed in any economic sanctions
list or are designated as a politically exposed
person subject to censure or sanctions by a securities
exchange or regulator or similar government entity.
Convicted of a felony or equivalent crime or
a crime of moral turpitude. Turpitude just means
something bad. Moral turpitude is a legal term
that refers to behavior that is immoral, deviant,
or wicked. It can also refer to behavior that
is unethical, unjust, or violates social standards.
Examples are fraud, theft, inflicting bodily
harm, reckless or malicious offenses. lewd intent,
stolen things, robbery, trespasses, voluntary
manslaughter. Or mentally incapacitated as determined
by two licensed medical doctors. All right. I
went over this in depth because this was carried
over into the new SIP process, and I had a lot
to say about it. I still think it's there. let's
take a look is it still there so we go to under
submission guidelines scroll down scroll down
scroll scroll scroll here's a checklist here's
part of it some of this is in there but it's
mostly this the ineligible sips all right so
virtual asset services this is why i didn't think
it applied to us because it wasn't allowed as
a sip But then you've got project teams that
are based in different countries, do not comply
with local laws, exploitation or harm of people.
I don't think the moral turpitude one is in here.
But there was one about, what was it? Sanctions,
right? Economic sanctions. That was the project
teams here. These are the sanctioned ones, I
suppose. So a lot of this, I had quite a bit
to say. on sandal podcast the new sip process
one that i've already mentioned a few times all
right section five advisory board purpose sandbox
dial advisory board is composed of cultural ambassadors
and strategic advisors who leverage their expertise
and networks to guide the dial toward achieving
its vision of a decentralized vibrant metaverse
members are influencers in their field and our
focus on shaping the cultural technological landscape
of the sandbox, fostering a community that values
creativity, innovation, and inclusivity, roles
and responsibilities. Advisory board members
will serve as cultural ambassadors and strategic
advisors to the sandbox DAO community, leveraging
their expertise and networks to guide the DAO
toward achieving its vision of a decentralized,
vibrant metaverse. Members will focus on shaping
the cultural. technological landscape of the
sandbox, fostering a community that values creativity,
innovation, and exclusivity. End. Inclusivity.
Please. Inclusivity. Membership. Candidates may
be proposed by SIP and elected pursuant to the
procedures set forth in Section 3. Next. Candidates
should be leaders or influencers in their area
of expertise, with a track record of achievement
in a field aligned with the sandbox vision and
values. and a demonstrated interest in and understanding
of Web3 technology. Compensation. Advisory board
members are not compensated. Advisory board members
are not paid. Special counsel members are. Let's
reference that. This was section 5. Page... What?
7. Almost there. Section 5. Okay. Term and removal.
Except for the initial members of the advisory
board whose term shall commence upon approval
of the first step, the sandbox doubt, and will
end December 31st, 2025. Each member shall serve
a term of one year unless earlier removed as
provided for below. Members may be reelected
upon the expiration of their term. Advisory board
members may be removed if they are determined
by a majority of the special council members
to have breached the code of conduct. Interesting.
Listed in any economic sanctions listed or are
designated as a politically exposed person. What
is that? It's like a legal term? In financial
regulation, a politically exposed person, otherwise
known as a PEP, is one who has been entrusted
with a prominent public function. PEP generally
presents a higher risk for potential involvement
in bribery and corruption by virtue of their
position and the influence they may hold. So
what financial regulation are we talking about
here? While there is no global definition of
a PEP, I think that's exactly what I was looking
for. Let's keep going though. Looks like there's
more to that. Many countries base their definitions
on those from the Financial Action Task Force
on Money Laundering. F -A -T -F from 2013. The
FATF is an international body founded in 1989
on the initiative of the G7 and is hosted by
OECD. Wait a minute, I think I've seen this before.
OECD is the Office of Community Economic Development.
Headquartered in Paris, France, the Chateau de
la Muette. That was terrible French. It's an
international organization. Hmm. Okay, so I don't
see if they're NATO or UN related or EU. This
looks like they're their own thing. Okay. Subject
to censor or sanction by a securities exchange
or regulator or similar government tool authority.
Convicted of a felony or equivalent crime or
a crime of moral turpitude or mentally incapacitated
as determined by two licensed medical doctors.
That's the end? That's it? She said the end.
That, ladies and gentlemen and folks in the SanFam,
is the end of our bylaws. All right. I didn't
really have any questions there except just the
one. Probably should have a second one, which
is why? Can the AB be removed by SC? That was
a weird one for me. See? So here are buzzwords.
So advisory board members are not compensated.
And they're separately elected. So why? Why is
that true? All right. So just those two. Cool.
Very cool. We are done with the bylaws. There's
only really one thing left. The remaining QAs,
we did that already. So there's only one thing
left, and that is to go over the entity search,
the stamp document search, and the regulated
entities. This is going to be easy. Very, very
simple. Hey, Roxy. Oh, my gosh. We're almost
six hours into this thing. It's been a long,
long road. We read through the bylaws. We read
through the articles of association. We read
through the memo of association. We did a nice
little recap. We're almost done. We just finished
the bylaws, and we're now headed to entity search.
There's one last final thing I wanted to show
you all before we... pretty much conclude today's
episode. And that's the entity search. Remember
how I said in the beginning how if you look at
the top right of the articles and the memos,
you can see here this little stamp. It might
be hard to read, but exempted foundation company
registered and filed as November 404930. Oops,
hold on. Exempted foundation company registered
and filed as number. 404930 on 20 november 23
2023 signed by the assistant registrar it looks
a little bit like this it's a little bit like
this right here okay so this is what i just read
to you that number 404930 on 20 november 2023
and then and the bottom was was this number here,
the authorization code, that F73130605971. If
you go to these websites, you can search these
documents. These documents are publicly listed
and available. All right, so I did that for you,
and I want to show you what it's like. All the
stuff that I've been doing, all this research,
all it is is... All it is... It's just me Google
searching stuff, looking stuff up, reading stuff.
That's all this has been. Anyone can do it. You
can do it. I wanted to do it for myself because
I wanted to understand what it was the DAO was.
I wanted to understand how we DAO. I wanted to
DAO better, and I wanted to learn. I set out
to figure out what the DAO was about, and it
led me on this huge, long road of researching.
I mean, this is it in a nutshell. Started with
episode 34 when I started investigating the TSB
DAO beginnings. Then I looked into, that led
me to reading the Cayman Islands Law. That read
me to reviewing the existing case law because
people kept talking about Lido DAO and BZX DAO
and Okie DAO, all these things that were affecting
and giving people pauses and concerns, all these
things. And I want to know more about that. So
we talked to a lawyer. Then we want to know more
about Cayman Island Foundation companies from
the Cayman Island lawyers. So we were able to
find two from Walkers Global. graciously gave
their time to share. Now, we're here in part
four, which is a read -through of all the documents
that are important to us and how we run things.
So, the final thing is the entity search. If
you go to the general registry, Cayman Islands,
and you go to online tools, Then you go company
search. Here's the website. You can look for
it yourself. Here are the terms that I searched.
You'll see this on the left, this entity search
thing, and you can type in people's names. You
type in anything you want. And I was just searching
to find the people that I was trying to locate
on this, this relationship map that I did in
episode 34. I was trying to find them. And as
I was researching them, I came across this entity
search. And here, you just input the name of
the stuff you know to search for. And for me,
I knew to search for Sandbox Foundation. I knew
to search for Maples Group. All these things
that were in the SIPS and the founding documents,
the constitution that we just read through. Okay.
But even more than that, we knew. what the document
numbers were okay so let's step through this
first of all you search who you want to find
all right so if you do that if you search sandbox
foundation all right this is what you'll find
hit search after type it in and you see sandbox
foundation under the entity name you'll see company
details director details and detailed search
in order to see the actual contents of those
documents you have to pay a 60 $61 fee for that
documentation to be furnished to you. I chose
not to do that because I wanted to keep it all
public and just not make that a little complicated
for myself. And one day I might, but that's publicly
available for anyone in accordance with Cayman
Island law. That's one of the reasons why you're
paying for the secretary so that she can continually
do this sort of stuff and make it available and
keep it up to date. You can do that. You can
find the company just by searching the name.
And if you search all the other entities like
Maples Group, ICS, IPA, you'll also find hits
for them. Information you can find out. Because
they have to be registered for the law that we
read in episode 56. But that's not all. If you
go to SEMA. SEMA, not SEMA. If you go to... the
registry .gov .ky verify which is right here
at the bottom of that authorization code it tells
you what website to go to so i went to that website
and when i went to that website i looked at the
file number now the file number here and i looked
at that off code and i clicked their verification
their handy dandy little search button thing
okay You type in the authorization code. You
type in the entry file number, both of which
we have. And then it will give you this. So it
was here. And then you take those two things.
You enter those two things in here. You go from
that to that. And then it will tell you, hey,
look. This document was really stamped. It's
true. It's real. And here's the date it was stamped
on. And then you get to read this part. So this
is what it says. This stamped document was issued
by the Cayman Islands General Registry for the
Sandbox Foundation on date 21 November 2023.
Type of stamped document is the article of association.
Boom. How about that? So this just confirms.
It's kind of like that age -old trust but verify.
This is the verification part of the trust, that
that document is real. All right, and then there's
one more step. So in SEMA, the Cayman Islands
Monetary Authority, that's where you can see
people and entities who are registered, registered
directors, registered secretaries, all the people
that you need to make sure that you're abiding
by Cayman Islands law. So what I did is I started
searching people's names and I started searching
entity names that we knew of. So all this looks
like is you go to the Cayman Islands Monetary
Authority, go to search entities, type in their
names, and then you'll see tons of stuff pop
up. So for me, I typed in Maples. So Maples Group.
They were one of the people who were asked to
help put all this together. And there they are,
right there. Here's their reference numbers.
Now, Maples just so happens to have a bunch of
different registered entities with SEMA. So they
got a bunch of hits. Could be any one of them.
Not really sure which one. Maybe Maples Secretaries
came in limited. But it's a trust type. So I
don't really know exactly what I'm looking at
here. But Maples Corporate Services Limited,
that looked like a big hit. And then Maples Secretaries,
that also looked like a hit. So then you can
also look at, you remember ICSL, the one that
is the principal agent is Mr. Alberga, our legal,
the one who owns the legal advisor free thing.
So if you type in ICS and I didn't know whether
to put L limited or type out limited. So I just
put ICS and international corporation services
got to hit right away. There it is. They're a
company manager. And they've been a company manager
since December of 1985. All right, then. So it
looks like these people have been around for
quite some time. Okay? So if you search these
things, you will get the same results I do. And
just to kind of nudge, hint, hint, nudge, nudge,
if you really want to, if you are part of the
ApeCoin DAO, then you can do the same thing.
Ape Foundation. And there's your hit. There's
your hit right there. And if you really, really
want to, you could also search some of the other
people that were recently, or not recently, but
that were also as part of an AIP approved to
do business. So web slingers, you can find them.
You can find BridgeStream. You can find a lot
of people. And so if you search the same website
we just showed you, here's their entity name,
and you can pay the $68 for their details. for
Ape Foundation. And then for SEMA, you can see
BridgeStream, which is part of the company that
partnered with WebSlingers. Here's BridgeStream's
registration. And this is the concluding thing
for episode 34. When we went over this in detail,
And if you recall, at the end of episode 34,
I did that nice little disclosure that I was
an ape holder. And then we talked about the ApeCoinDAO
who runs it because earlier, earlier, we found
a connection to AIP1 with the Cartan group. All
right, so what I did was I investigated that
connection just a little bit and made my disclosure
that I am an ape holder. And that when we were
trying to look at who was actually running the
ApeCoin DAO, we found out that through AIP196,
when Cartan Group was not renewed, and WebSlingers
and CrestBridge, which later became BridgeStream
Group, did take their spot. AIP196. So WebSlingers
and BridgeStream now. are the ones who are the
company manager, company management services.
So that is a conclusion of... This is the conclusion
of that. So if you want to find who is running
your DAO, and they are a Cayman Islands entity,
you want to first get your hands on the document,
if you can, the articles and the memos. But if
not, you can still search the entity. on the
online tools and company search in myegov .ky.
You can also search registry .gov .ky to verify
a document name and number if you have it. Like
that. And you can search SEMA, which is the registered
authority for giving out licenses and qualified
persons. You just search the name of stuff. You
can find them. Find the reference number. You
can probably put that reference number in here,
a search. Find it there as well. This is how
you can not only trust but verify, but also be
involved. If you want to be more involved in
the governance of stuff, this is how you do it.
All right. Last remaining thing was the remaining
questions. All right. So the remaining questions
tab here. i was going to put everything in here
but at this point let's just go remaining questions
from sandal 34 i had a bunch of questions about
who had control of what all these wallets cyril
did end up answering quite a number of them in
the discourse so i'll just briefly put them here
and you can again i'll start from the beginning
again so here are the questions i had and you
can go to on the forums here it is i did a a
discord or discourse post this is what's called
you can search it dao admin team q a request
on upcoming review of the sandbox south foundation
constitution articles and memos this is back
in october 124 uh i told them this was coming
and i asked a bunch of questions i asked a bunch
of questions i gave them all the questions to
answer and all that stuff and they ended up answering
quite a bit Okay, so this is that. So these questions
here, I'll pause for a few seconds so you can
pause the video. Here's the next batch of questions.
Here's the next batch of questions. I'll zoom
in on the top. And I'll go to the bottom. Then
here is the last batch of questions that were
answered. zoom in a little bit more and i'll
scroll down to the bottom there you have it those
are the answer questions but let's go to the
remaining questions which we compiled as we went
along so for our questions the remaining questions
of the articles of association and i will try
to ask everyone i can the the lawyers that we
had on for for sandow 59 i'll also post those
questions on the discourse i'll try and get Either
the director, Michael Robinson, or Cyril Ahn,
or some sort of follow -up. We'll see. But let's
go with, that is, wait, what? Oh, excuse me.
Memo of association was the first batch of questions
we had. And let's see. Is a memo equivalent to
articles of incorporation or organization in
the U .S.? I think the answer to that is yes.
For two. Question two is, does the VASP apply
to TSBDAO Foundation, to the virtual asset service
provider? And that's because there's a reference
of digital asset words, but also, right, reference
TSBDAO website prohibited SIPs. Forgot about
that one. We still have that up? We sure do.
Let's take a snapshot of that. screenshot and
put it on our what we got going on here it is
this one taking straight from the website okay
and okay so that's it that virtual asset service
provider act does it apply to the sandbox style
foundation Question three is, is our director
a licensed director under the Director's Registration
Licensing Act or licensing law? Question four,
does the Securities Investment Business Act apply
to the TSB Dow Foundation? Check. Question five,
who are the beneficiaries and is it SanFam? Question
six. Is this protecting the DAO's assets, talking
about the land, sand, and NFT collection, from
being unreasonably gifted or given to the Sandbox
DAO Foundation staff, like the director or whoever
else, from them just giving themselves stuff
that we don't believe they earned? Question seven.
Does this relate to the memberless part that
removes the profit incentive for maximization
of shareholder value? required by a fiduciary
duty of the director. Question eight, why is
the founder role only mentioned here? It's not
clear who or what this is. Question 11, who is
the founder? All right, then we move on to our
questions for articles of association. Question
10, we're just going to continue the numbering.
Does the mention of revised mean that it always
references the latest revision of? the Foundations
Company Act of 2017, and the Companies Act of
2003. Question 11. Please explain the nature
of the sentence, the Foundation Company's general
nature of business is holding company securities.
All right, so we'll see question four on that
one, which was about whether or not the Securities
Investment Business Act applied. All right. Question
12. Is the company IP &A led by Michael Robertson,
which is our director? And if not, who is? IP
&A is International Protectors and Advisors.
And that's not ICSL, the International something,
something, something, something. The International
Corporation Surfaces Limited, which the key principal
for that is Michael Alberga, who is part of our
legal team. Pardon, TTA. Travers Thorpe Alberga.
Question 13. Does free of any duty mean fiduciary
duty? And if not, what else? Question 14. And
may be exercised for the founder's own benefit,
is a quote we took. Does this mean that they
get to disregard the Memorandum of Association,
page 3, section 9? And that was... Section 9
were all of the expansion stuff. Section 9. Member
of Association, page 3. Oh, page 4, excuse me.
That's why. Page 4, section 9, which is where
each member undertakes to contribute to the assets
of things getting wound up, and then they only
have to pay $1 if there's a liability thing going
on. Section 15. Is there a contradiction here?
The founder may irrevocably revoke his or her
own powers, but has the power under Section 3
.2i to change the MOA of Association and the
Articles of Association however they want. And
Section 3 .6 and Section 3 .7 says it only terminates
upon winding up. The power. It says the power.
founder's power, only terminates upon winding
up. Question 16. Does this mean that if a founder
makes a decision and then their power terminates,
the decision must be upheld after they leave,
such as appointing a new supervisor and then
the founder leaves before that supervisor is
appointed, that decision getting reversed? Okay.
Question 17. Did the initial subscriber become
the founder or director? Question 18. Is the
special counsel or advisory board considered
members? If not, what are they? Section 19. Question
19. Can the founder overturn this irrevocable
prohibition? Question 20. The quote may restrict
or prohibit members. How do all the positions
interact day to day? Question 21. Does, quote,
May extend all the powers of the foundation company.
End quote. Meaning the director can exercise
the founder's powers. Question 22. Is this extra
to the fiduciary duty or does it only reinforce
it? Question 23. Is the code of conduct for the
TSB Dells approved delegates considered a committee?
Is the special counsel an advisory board? Question
24. Quote, have at least one supervisor who is
not a director. End quote. Where did we read
the supervisor could be the director? I couldn't
figure it out. I remember reading something like
that. Question 25. May call for such reports
accounts. Oh, I don't think I put my question
there. I'll have to figure that one out later.
Question 26. The beneficiary shall have an enforceable
right. Put in quotations. What enforceable right
is that? And 27, we need more clarity on the
restriction notice power. There wasn't any mention
of it. How does that play into any of this? Question
28, is the assistant secretary required to be
a qualified person? Question 29, why does the
accidental omission supervisor not invalidate?
Why does the accidental omission? not invalidate
the proceedings. And we had some loopholes there
that we contemplated that were apparently okay
under the way that it was written. Question 30.
Quote, no business shall be transacted at a general
meeting. End quote. What is business? I think
we might know because of the way it's defined
in reference section two, but I don't know. There's
enough there. I don't know. Question 31. Who
is the chairman? They aren't mentioned anywhere
before. Question 32. What does and the matters
mean in that sentence? That's section 13 .1.
Question 33. Who is the auditor? They aren't
mentioned anywhere before. Question 34. How enforceable
is, quote, members, directors, and supervisors
as such have no power or authority to wind up?
End quote. And also in quotes, or petition to
court, in quote, when the founders' roles are
optional. Question 35, who are the indemnified
parties? This section grants broad liability
waiver if legal was involved in the action. That
seems like it could be anything. Seems like it
could be anything. Used to indemnify. Anything.
Right? Maybe that's the point. Don't know. Question
36. This seems to encompass everything about
the Sandbox DAO Foundation, and we're referring
to the bylaws. This seems to encompass everything
about the CSB DAO Foundation. Does this section
exclude anything? As in, is there anything something
the bylaws can't touch? That is my last and final
question that I have remaining after looking
everything over. All right. Oh, just kidding.
Shoot, I forgot about the bylaws. So 36, so we
have 38 questions total. 38. So question 37,
why three consecutive terms for the special counsel?
What was the thought there? And then question
38, why can't the AB, the advisory board, why
is the AB able to be removed by the special counsel?
And not other AB people at advisory board. That
seems strange to me. AB doesn't actually seem
to have much power, whereas a special counsel
does. But we're giving the special counsel power
to remove the people who are not being compensated.
Something about that that doesn't make full sense
to me. And that's it. 38 questions. And we went
over the entity search. Talked about how to search
for things. how to find things in SEMA. And if
you're ApeCoinDAO, then maybe there's something
over here for you. And if you're Star Atlas,
same thing. Same thing. And you can find, I know
Star Atlas DAO makes their articles, has made
their articles public. So you can do the same
thing. You can search. It's all publicly available.
And then we went over our remaining questions.
And that is, see slides. What slides do we need
to look at for? Slides 33 through 49. For the
38 questions. That's a lot. That is a lot of
questions. I'll give it to you. Maybe I'll. Maybe
I'll prioritize them. But the order that I really
want answered. So we went over that already.
And. We already went over the remaining questions
from Sandow 34, and the answers, they were mostly
answered. That will bring us here to the end.
That will bring us to the end. So, let's talk
about what happens next. We went through Sandow
34, which is a look into the origin of the sandbox
DAO. We went into reading the Cayman Islands
lore. Sandow... That's part one of our miniseries.
Then we went into the review of existing Dow
case law, the practicing attorney in the United
States. That was part two, standoff 57. Part
three of our miniseries for foundation companies
came with a Q &A of Cayman Island lawyers from
Walker's Global. Two practicing attorneys there,
standoff 59. And part four, which is what you're
listening to now, I may end up breaking this
up because this thing was six hours long. Unbelievably,
six hours long. So I might break this up into
multiple parts, but as of right now, it's a combined
part four, which was a reading of the Sandbox
DAO documents. And if there are later parts,
it'll likely be a Q &A, an interview of the Q
&A. Don't know yet who it's going to be. I might
not even be able to get to it because I've been...
Starting to devote my time elsewhere with Sandow
Podcast because the Sandow Podcast was not funded.
And if you want to learn more about that, you
can go to episode 55, The Downfall of SIP18.
The Downfall of SIP18, which was funding the
Sandow Podcast. So take a look at that one if
you want to learn a little bit more about what
is... in store for Sandow podcast. And, and yeah,
I thoroughly enjoyed this mini series. So much
fun. This was so much fun. Took a lot of, a lot
of energy, took a lot of critical thinking, took
money. I didn't pay for any information, but
it took money to produce these episodes in a
way that just, it costs money. to do a podcast.
So, unsure if I'm going to do more, but if I
do, we now have the stage set for what that's
going to look like. All right. What I will do
is I will do a podcast on all my episodes. So
I'm going to go through all of these. We just
are about to conclude our 60th one. So, dunzo
here in a second. 61. was going to be the sandbox
ecosystem in the DAO. However, it's going to
be about interviewing whale .me, whale members.
Sandbox ecosystem in the DAO is something I really
want to do before I end, but I might just run
out of steam and not be able to get to it. And
in this one, I'm working with the other side
folks to see if they will have their project
manager. do a podcast with me i they recently
just broke the guinness world record for something
that i helped break back in 2016 so i organized
the guinness world record breaking back in 2016
and they other side from acorn dow just broke
it this past saturday not this not this saturday
today but last saturday seven days ago and i
feel a little i feel multiple ways about it I
mostly feel supportive, but I also feel a little
bit sniped. Taken aback. Because I didn't see
them go after this Guinness World Record until
I mentioned it on the ApeCoin .com forums to
assist another AIP who wanted to go for another
type of Guinness World Record, which is the largest
get Tonic and Jen in the world. So I mentioned
my resume to, to let them know that, Hey, I'm
willing to help. I've done this before. And then
two weeks later, I see three weeks later, I see
other sides trying to get that same world record
that I mentioned multiple times in multiple places.
So I feel a little weird about that because they
never contacted me. They never talked to me about
it, but now that they've broken it with over
2000 players, huge congratulations to them. I
would like to talk with their project manager
and just kind of do like an ending, just like
a kumbaya of sharing notes and understanding
what they experienced for this Guinness World
Record break. And then we can call it a day.
Water under the bridge, everything else. I'll
feel good after that. So I hope that they take
me up on that. If not, I have a solo episode
I'm going to do on it that's pretty much ready
to go. but I would much rather do the version
where we work collaboratively and talk to each
other about our experiences versus what I would
go over, which is the history of it. And yeah,
I'd much rather do the, the other version. So
sandbox faces, where do we, where do we get together
as San, San fam on discord, the sandbox game
discord, the channel is Dow discussion. Also,
we're on the Sandbox DAO forums. The discourse
is part of the tech stack we mentioned earlier.
On Twitter, hashtag SandFam, hashtag the Sandbox
DAO, hashtag the Sandbox game. Look up the Sandbox
DAO and Arash Selective. Arash Selective does
a newsletter, has been doing it for quite some
time. Big shout out to Arash Selective. And then
on YouTube, there is the Sandbox DAO YouTube
page. Right? It's over here. And then there is
also... And then there's also, you know, Lanzer
YT, which is Sandow. And so here it is. 60 episodes
we're about to hit. And then last but not least,
SanFam Cafe. They haven't been active in quite
a few months, but they're normally weekly, interesting
stuff between SanFam people. If you are into
the ex -Twitter spaces, on Monday is Mochaverse
Hall. On Saturday is Bulls on the Block. Monday
through Friday is Coffee with the Captain. And
on Tuesdays is Natively Digital. Tomorrow, I
should be interviewing the Whale members, who
are one of the largest, if not the largest, voting
landowner in our DAO. Looking forward to that.
Very interested, looking forward to that. Okay.
Thank you all for your time. This was a really,
really long one. But in the end, it was very
important to go over. And we went over a whole
bunch of stuff related to DAO structures, legal
foundations, all the stuff. And I enjoyed this.
I feel like we are pretty much completed. If
I don't do any more of them, it'd be great. If
I do more of them, also great. And yeah, today
was part four. of the Sandbox Foundation Company
mini -series, where we looked into the Memorandum
of Association, Articles of Association, and
the bylaws. This was episode 60. Thank you all
for your time, and have a great day, Sandvam.