The following are the official bylaws I helped design and draft for MetricsDAO in 2023. They serve as a practical example of how to legally bind a Delaware nonstock corporation to the onchain and offchain governance decisions of a decentralized community (using tools like Snapshot, Discourse, and digital badges).
You can read more about MetricsDAO Governance here.
BYLAWS OF METRICSDAO ASSOC.
MetricsDAO Assoc. (the “DAO”) is a Delaware nonstock corporation organized to cultivate an inclusive data services marketplace and vibrant community ecosystem. We strive to democratize on-chain and off-chain participation, driving organizations’ digital growth. By intertwining blockchain technology and data services, we aim to foster a collaborative environment where analysts and organizations can connect, share insights, and catalyze the transformative power of the space (the “Mission”). These Bylaws set forth to govern the internal matters of the DAO.
ARTICLE I
MEMBERS
Voters. The DAO has one class of “Members,” called the “Voters.” Voter-status and other roles discussed below are designated by digital, non-transferable “badges” using a technology solution selected by the DAO from time to time (“Badge(s)”). A person may only hold one (1) Badge of any Badge class at any time. A Member may hold more than one Badge from different Badge classes.
Any person may become a “Voter” by receiving a Core Contributor Badge or Steward Badge (each, a “Voter Badge”), as each is defined below.
Voters work towards furthering the Mission and are active members in the DAO. They may act in any number of roles such as analysts, educators, governance researchers, treasury managers, moderators, content creators and community stewards, as well as being active participants in the governance system. Voters publish proposals, comment on RFCs, and participate in polls, so that governance is the most reflective of the will of the community at any time. There are two subclasses of Voters:
- Core Contributors. Persons who participate in the day-to-day operations of the DAO including in areas like business development, marketing, treasury management, among other things, become “Core Contributors” by receiving a Core Contributor Badge.
- Stewards. Persons who provide value to the larger ecosystem (without being involved in the day-to-day operations), become “Stewards” by receiving a Steward Badge.
A membership in the DAO is not transferable. A Member may terminate their membership in the DAO by requesting the Lead Badger (as defined below) to revoke all or some of their Badges.
ARTICLE II
BOARD
The DAO is governed by the Voters. However, to the minimum extent required by applicable law and as set forth below, certain matters of the DAO require participation from a Board of Directors elected by the Voters (the “Board”). The initial size of the Board shall be seven (7) persons (each, a “Director”).
An elected Director is given a Board Badge. A Director may resign by sending a conspicuous written notice in the designated Discord channel typically used for important community notices (the “Resignation Notice”). A Director’s resignation is effective once a replacement Director has been appointed, unless the resigning Director clearly states their intent to resign effective immediately in the Resignation Notice.
ARTICLE III
OFFICERS
The DAO is governed by the Voters. However, to the minimum extent required by applicable law and as set forth below, certain administrative tasks will be assigned to one or more persons designated by the Board, after a guiding vote by the Voters, who are then given an Officer Badge (as defined below) (each, an “Officer”). An Officer may resign by requesting a Lead Badger to revoke the applicable Badge.
An Officer shall have the power to execute all contracts, agreements, and other obligations of the DAO that are authorized by the Voters or the Board. However, an Officer shall be empowered to execute and handle ministerial, administrative tasks on behalf of the DAO without a separate vote by Voters or the Board, including filing tax returns and annual state reports, KYC processes for receiving airdrops, among other similar administrative things that do not affect the success of the DAO.
ARTICLE IV
LEAD BADGERS
The DAO is governed by the Voters. However, to guarantee smooth operations of the DAO, the Voters will elect one or more persons (each, a “Lead Badger”), who are then given a Lead Badge, to manage certain administrative and other responsibilities, including:
- Checking if METIPs (as defined below) are correctly formatted, submitted in the right forum category and are well-shaped, understandable and not in violation of the MetricsDAO Code of Conduct or Mission;
- Creating and providing Voter, Board and Officer Badges;
- Revoking Voter, Board or Officer Badges in the event of one of these roles leaving or in the case of a clear violation of the Code of Conduct, or if otherwise instructed by valid governance output; and
- Answering questions about governance processes and aiding proposal authors along the lifecycle of the proposal to make governance contributions easier.
A Lead Badger can be terminated at any time via an Emergency Poll (as defined below) should they behave in a manner that is contrary to the Code of Conduct. If a proposal to replace a Lead Badger is supported by at least seven Voters, as indicated by explicit consent via a reply to the proposal post, the implicated Lead Badgers cannot revoke any Voter Badges for the duration of the poll.
ARTICLE V
VOTING
Section 1. Proposal.
A Voter (the “Author”) may submit a formal proposal (“METIP”) for review and consideration by entering it into the Governance category in Discourse. Voters should publish new METIPs ahead of weekends or holidays to ensure maximum participation by the community and respect off-time and family obligations.
Section 2. Request for Comments.
A proposed METIP has a three day (72 hours) feedback period (“RFC Period”).
The RFC Period shall be four days (96 hours) for any METIP involving:
- Approval of an annual budget;
- Changes to the Certificate of Incorporation, Code of Conduct or these bylaws; or
- Any other matter that needs a Board approval under applicable law.
(each, a “Material Matter”).
The RFC Period shall be one day (24 hours) for a METIP that the Author clearly marks in the heading as an “Emergency METIP.”
During the RFC Period, the Author may amend the METIP based on feedback from other Voters.
Section 3. Frozen Period.
After the RFC Period, the final METIP, that incorporates any community feedback the Author has wished to address, has to remain visible on the MetricsDAO Governance Forum in Discord for one day (24 hours) (the “Frozen Period”). The Frozen Period is two days (48 hours) for Material Matters. Emergency METIPs do not have a Frozen Period.
Section 4. Poll.
After the Frozen Period, the METIP is open for voting in Snapshot (“Poll”) for two days (48 hours) starting on the following Monday at 12:00 UTC (8 AM EDT/EST) (the “Poll Period”). A valid Poll in Snapshot must meet the following criteria:
- The title of the Poll in Snapshot matches exactly the title of the METIP on the MetricsDAO Governance Forum;
- A summary of the METIP, ideally no longer than two paragraphs; and
- A link back to the METIP on the MetricsDAO Governance Forum.
Each Voter has one vote and can choose from the following options:
- Yes (In Favor of the METIP passing)
- No (The METIP shall not pass, and not be implemented in its current form)
- Abstain (The vote will not count towards either Yes or No, but will count towards the total votes cast)
- No with veto (The METIP shall not pass, and the Voter has strong objections)
Emergency METIPs can proceed to a Poll at any time.
Section 5. Result.
After the Poll Period, the following criteria must be met for any METIP to pass:
- At least 33.1% of all Voter Badge holders cast a vote (“Quorum”);
- At least 50.1% of the Voter Badge holders who cast a vote voted Yes (“Approval”); and
- Less than 33.1% of the Voter Badge holders who cast a vote voted No with veto (“Not-Vetoed”).
If the METIP involves (i) electing a Director, (ii) removing a Director, or (iii) changing the size of the Board (“Board Vote”), the following criteria must be met for the METIP to pass:
- At least 50% of all Voter Badge holders cast a vote (“High Quorum”);
- At least 67% of the Voter Badge holders who cast a vote voted Yes (“High Approval”); and
- Less than 10% of the Voter Badge holders who cast a vote voted No (“High No”).
- Less than 25% of the Voter Badge holders who cast a vote voted No with veto (“High Not-Vetoed”).
If the METIP is an Emergency METIP, the following criteria must be met for the METIP to pass:
- Quorum;
- High Approval; and
- Not-Vetoed.
If a decision requires Board members to act, the Board must comply with the will of the DAO as expressed via valid governance output.
Section 6. Material Matters.
If the METIP involves a Material Matter, the Board must meet or act via written consent without delay. The Board must take action to fulfill the Voters’ will expressed in the Poll unless applicable law requires otherwise. If the Board decides to not act in accordance with the result of the Poll, the Board must give a specific, clear and understandable rationale in a forum post on Discourse referencing the original METIP.
ARTICLE VI
MEETINGS
Section 1. Annual Meeting.
No annual meetings of the membership are required to be held. The Members may from time to time determine to hold annual meetings of the membership or cease holding such meetings. If annual meetings of the membership are held, they shall be held at such place (if any) and at such date and time as the Members shall fix.
Section 2. Special Meetings.
Special meetings of the membership, for any purpose prescribed in the notice of the meeting, may be called at any time by any Voter or Director, to be held at such place (if any) and at such date and time as the Members or Board shall fix.
Section 3. Notice of Meetings.
Notice is deemed given in accordance with Section 232 of the Delaware General Corporation Law when notice of the place (if any) and the date and time of all meetings of the membership is given by a post on the MetricsDAO Discord Forum not less than five (5) days before the date on which the meeting is to be held.
Section 4. Quorum at Meetings.
The quorum and approval criteria set forth in Section 5 of Article V shall apply to annual and special meetings.
Section 5. Organization and Conduct of Meetings.
The Members shall designate a chairperson of the meeting. The secretary of the meeting shall be such person as the chairperson appoints. The chairperson of any meeting of the membership shall determine the order of the procedure at the meeting.
Section 6. Action by Written Consent Without a Meeting.
Any action that is required to or may be taken at any annual or special meeting of the membership, may be taken without a meeting, without prior notice, and without a vote if a consent in writing, setting forth the action so taken, is (a) signed (which may include, without limitation, cryptographic signature) by the Members, having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all Members, entitled to vote thereon were present and voted, and (b) posted as set forth in Article V which shall be deemed to meet the notice requirements of Section 228 of the Delaware General Corporation Law.
Section 7. Board Regular Meetings.
Regular meetings of the Board shall be held at such place or places (if any), on such date or dates, and at such time or times as shall have been established by the Board and publicized among all Directors. A notice of each regular meeting shall not be required.
Section 8. Board Special Meetings.
Special meetings of the Board may be called by a majority of the Directors then in office and shall be held at such place (if any), on such date and at such time as the Directors shall fix. Notice of the place (if any), date and time of each such special meeting shall be given to each Director by whom notice is not waived, (a) in person at least twenty-four (24) hours in advance of the meeting, (b) by telephone, voice mail, or electronic transmission at least twenty-four (24) hours in advance of the meeting, (c) by sending written notice by overnight courier not less than two (2) days before the meeting, or (d) by mailing written notice not less than five (5) days before the meeting.
Section 9. Quorum at Board Meetings.
At any meeting of the Board, a majority of the total number of Directors then in office shall constitute a quorum for all purposes.
Section 10. Participation in Board Meetings.
The Directors may participate in any meeting of the Board in person, or by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation shall constitute presence in person at such meeting.
Section 11. Conduct of Business at Board Meetings.
The affirmative vote of a majority of the Directors present at any meeting at which there is a quorum shall be the act of the Directors. If at any time the corporation has exactly two (2) Directors, one (1) Director shall not constitute a majority and a unanimous vote shall be required.
Action may be taken by the Board without a meeting if all members of the Board consent thereto in writing or by electronic transmission.
ARTICLE VII
WAIVERS
Whenever notice is required to be given under any provision of the Delaware General Corporation Law or of the certificate of incorporation or these bylaws, a written waiver thereof, signed by the person entitled to notice, or waiver by electronic mail or other electronic transmission by such person, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Members or the Board need be specified in any written waiver of notice, or any waiver of notice by electronic transmission, unless so required by the certificate of incorporation or these bylaws.
ARTICLE VIII
INDEMNIFICATION
Section 1. Right to Indemnification.
The corporation shall, to the maximum extent and in the manner permitted by the Delaware General Corporation Law, indemnify each of its Directors, Officers and Lead Badgers against expenses (including attorneys’ fees), judgments, fines, settlements and other amounts actually and reasonably incurred in connection with any proceeding, arising by reason of the fact that such person is or was an agent of the corporation.
Section 2. Indemnification of Others.
The corporation shall have the power, to the maximum extent and in the manner permitted by the Delaware General Corporation Law, to indemnify each of its Members, employees and agents against expenses (including attorneys’ fees), judgments, fines, settlements and other amounts actually and reasonably incurred in connection with any proceeding, arising by reason of the fact that such person is or was an agent of the corporation.
Section 3. Payment of Expenses in Advance.
Expenses incurred in defending any action or proceeding for which indemnification is required pursuant to Article VIII, Section 1 or for which indemnification is permitted pursuant to Article VIII, Section 2, following authorization thereof by the Members shall be paid by the corporation in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of the indemnified party to repay such amount if it shall ultimately be determined by final judicial decision from which there is no further right to appeal that the indemnified party is not entitled to be indemnified as authorized in this Article VIII.
Section 4. Indemnity Not Exclusive.
The indemnification provided by this Article VIII shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under any bylaws, agreement, vote of Members or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office, to the extent that such additional rights to indemnification are authorized in the certificate of incorporation.
Section 5. Conflicts.
No indemnification or advance shall be made under this Article VIII, except where such indemnification or advance is mandated by law or the order, judgment or decree of any court of competent jurisdiction, in any circumstance where it appears (a) that it would be inconsistent with a provision of the certificate of incorporation, these bylaws, a resolution of the Members or an agreement in effect at the time of the accrual of the alleged cause of the action asserted in the proceeding in which the expenses were incurred or other amounts were paid, which prohibits or otherwise limits indemnification or (b) that it would be inconsistent with any condition expressly imposed by a court in approving a settlement.
ARTICLE IX
MISCELLANEOUS
Section 1. Fiscal Year.
The fiscal year of the corporation shall be a calendar year.
Section 2. Natural Persons.
A Voter or Lead Badger who is not a natural person must be represented by an individual, associate, officer, manager, or member thereof duly authorized by the Voter or Lead Badger. Directors and Officers must be natural persons.