I would propose that the best way to move forward is to get a group together who is willing to put some work in to making this happen and then as that group, which would probablly have to file as an llc or somthing simular, begin negotiations with Goerge.
I dont really see this as a sudo room specific thing more that sudo room could lease from the 2141 co-op once it owns that portion of the building.
-Andrew
On Oct 3, 2013 1:36 PM, "Eddan Katz" <eddan@clear.net> wrote:
As I mentioned on my phone-in to the meeting last night, there were no numbers discussed at any point, neither regarding sale nor shares nor rental.
Not sure how it would make sense to try and figure it out, but I would guess some of you number-crunchers can propose some share/sq. ft. metric.
On Oct 3, 2013, at 1:28 PM, Max Klein <isalix@gmail.com> wrote:
I would like to also talk about co-op purchase greatly. Unfortunately I cannot make the meeting that you proposed at Farley's. It seems like we might also want to have it after a sudo meeting? Well in any case, to get the most participation I've created a doodle for such a meeting:
http://doodle.com/bd7ars64a3ngfd4m
Should we also include BAPS and CCL since they would be also potential investors? Also it seems like we should get a firmer undesrstanding of what the purchase price and terms would be. Eddan do you have that information? Can someone with connections to George get a non-obligatory estimate price from him?
Max
On 1 October 2013 16:54, Anthony Di Franco <di.franco@gmail.com> wrote:
I'll be there.
On Tue, Oct 1, 2013 at 4:32 PM, Andrew <andrew@roshambomedia.com> wrote:
Hi,
If people are not quite aware of what Eddan is talking about with the JOBS Act Crowd Funding, It was brought up at our first unconference just as Sudo Room was moving in to 2141. Here's some more information
http://www.forbes.com/sites/tanyaprive/2012/11/06/inside-the-jobs-act-equity-crowdfunding-2/
I'm definitely interested in talking a discussion of the possible co-oping of a portion of 2141 off line and meeting up at Farley's maybe Monday next week (Oct. 7th) 6pm? Who's down?
--Andrew
On Tue, Oct 1, 2013 at 4:21 PM, Anthony Di Franco <di.franco@gmail.com> wrote:
To try to help answer the question of what exactly happened and what the implications are, let me quote from Eddan's email, emphasis mine (archived here):
?Terminating the current lease means the latter, David. That is - at that point, a new/better lease can be negotiated. Or not, if so decided. While the details on what a co-op purchase would look like still have to be hammered out in detail, it was my understanding from George that he was interested in an arrangement that would include selling off equity in that portion. Different organizations would put up money in their collective shares and that wing would be organized as a co-op with the different organizational/individual owners taking part in the decision-making of managing the building.?
and from Hol's email, (archived here):
?I think we've been fortunate to have people (Eddan, Matt, Zach) put their name down in the lease and assume a degree of liability for operations. I interpret the notice to George as a move that is not binding on sudo room in any way, but one that A) allows Eddan and presumably Matt to relinquish their "doing business as" status to a better defined group, B) informs George that his behavior toward tenants will not be met with guaranteed continued tenancy, and C) puts a fire under all of our asses to solve the space/access/community issues elegantly, either by finding a new space or by coming to an agreement and a way forward at 2141. These are just my thoughts, with a grain of salt on specifics as I haven't been going to general meetings recently but I guess it's time to start doing that again since this is a matter of great importance.?
On Tue, Oct 1, 2013 at 4:05 PM, rhodey <rhodey@anhonesteffort.org> wrote:
All that myself and others have asked of you is that you provide a bit
more detailed information about the discussion you had while terminating
the lease. Your name was on the lease, I believe you have every right to
terminate the lease in order to remove your name. What I cannot
understand is why you consider questions regarding the discussion you
had off topic or offensive.
For the sake of moving on to the work we have cut out for us - this
is my last message addressing this topic.
I'm confused as to how we're supposed to continue onto the work we have
cut out for us without knowing the details and expectations surrounding
the termination of our lease. I was not asking "why" did this happen, I
was (am) asking "what" happened.
I am removing myself from any further discussion regarding the 2141
location on this mailing list, apologies to those who's feelings were hurt.
-- rhodey
On 10/01/2013 03:43 PM, Eddan Katz wrote:
This is an extraordinarily unfair thing to say. On so many levels.
I'm sorry that I have not articulated myself better. Those who know me, know that the message below is unfounded and mean-spirited.
For the sake of moving on to the work we have cut out for us - this is my last message addressing this topic.
sent from eddan.com
On Oct 1, 2013, at 3:09 PM, rhodey <rhodey@anhonesteffort.org> wrote:
Eddan,
You took it upon yourself to terminate SudoRoom's lease in (what I
understand to be) a private meeting. Putting the question of whether
or not this was agreed on by SudoRoom aside, the very least that you
could do is share with us the details of a discussion you had on our
behalf.
Take a second to realize that although the idea of investing in
property is both interesting and financially feasible for you, others
may not feel the same or be financially able.
-- rhodey
On 10/01/2013 02:54 PM, Eddan Katz wrote:
I don't think it makes any sense to lump this into one of george's
emotional outbursts.
as we've all been following closely over this list, the equity
crowdfunding provision of the Jobs Act, which went into effect last
week on Sept. 23, 2013, enables the distribution of shares outside
the traditional infrastructure of approved investors. the changes
in the future of capital flow routing around wall st. and the rules
surrounding investment cannot be underestimated. by opening up the
buying of stocks to us regular folks - with capital investment no
longer made unaffordable because of the huge cuts taken by
investment bank intermediaries and securities regulations
fortifying the status quo - the possibilities for raising capital
have just exploded.
most interestingly, from my point of view, a collaborative
non-hierarchical ownership and management structure becomes
feasible in a way that it has never been in economic history.
On Oct 1, 2013, at 2:07 PM, Marina Kukso <marina.kukso@gmail.com
<mailto:marina.kukso@gmail.com>> wrote:
as far as i know eddan is the only one who has spoken with
george, one of the building's owners, about the co-op
possibility. eddan, can you share any more info about what
exactly george said (my main question is whether this is just
another one of george's idle threat type things that he just says
and never intends to follow through on).?
On Tue, Oct 1, 2013 at 12:38 PM, Zee <zee@zeespencer.com
<mailto:zee@zeespencer.com>> wrote:
I am exceedingly interested in this, and would happily discuss
it further over tea or coffee with other interested parties.
On Tue, Oct 1, 2013 at 12:36 PM, Andrew
<andrew@roshambomedia.com <mailto:andrew@roshambomedia.com>>
wrote:
I have no idea what the price per sq-ft is. We should find
that
out. Also
having the capital isn't really as important as having a small
group who is
willing to put in the time and resources when necessary to
make
it happen.
With good enough credit it would be possible to finance the
space depending
on the down payment. Or even crowd source the down payment.
There are a lot
of options if there are people who actually want to it.
On Tue, Oct 1, 2013 at 10:57 AM, Hol Gaskill <hol@gaskill.com
<mailto:hol@gaskill.com>> wrote:
bump
Oct 1, 2013 10:51:46 AM, zee@zeespencer.com
<mailto:zee@zeespencer.com> wrote:
Do we have an idea on what the per-sq-ft sale cost is?
On Tue, Oct 1, 2013 at 10:50 AM, David Keenan
dkeenan44@gmail.com <mailto:dkeenan44@gmail.com>> wrote:
The co-op thing sounds like a very cool idea, except for
the
fact that
neither I nor anyone I know has, to my knowledge at
least,
access to
the volume of capital that i imagine is required, so
personally
I'm still a
bit lost on how one would move forward on such an
acquisition..?
-d
On Tuesday, October 1, 2013, Andrew wrote:
I haven't been around all that much, but am I correct
to
assume that
the current situation is that:
1. Sudo Room's current lease ends Jan 1st 2. George is
willing to sell off part of 2141 to a group of
investors?
If this is so. Let's talk 2141 Co-Op. Is there anyone
on
this list who
would be at all interested in owning part of a building
in
the middle
of Downtown Oakland??
Sudo Room or not, this is a great opportunity for a
collective to turn
some extremely prime real estate in to a commercial
Co-Op.
Just wanted to bring attention to this. Thoughts?
-- ------- Andrew Lowe Cell: 831-332-2507
<tel:831-332-2507> http://roshambomedia.com
<http://roshambomedia.com/>
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_______________________________________________
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<mailto:sudo-discuss@lists.sudoroom.org>
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_______________________________________________ sudo-discuss
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<mailto:sudo-discuss@lists.sudoroom.org>
http://lists.sudoroom.org/listinfo/sudo-discuss
-- ------- Andrew Lowe Cell: 831-332-2507 <tel:831-332-2507>
http://roshambomedia.com <http://roshambomedia.com/>
_______________________________________________ sudo-discuss
mailing list sudo-discuss@lists.sudoroom.org
<mailto:sudo-discuss@lists.sudoroom.org>
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_______________________________________________ sudo-discuss
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<mailto:sudo-discuss@lists.sudoroom.org>
http://lists.sudoroom.org/listinfo/sudo-discuss
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-------
Andrew Lowe
Cell: 831-332-2507
http://roshambomedia.com
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-------------- next part --------------http://lists.sudoroom.org/listinfo/sudo-discuss
From: Peter Harter <farrington@gmail.com>
Date: October 4, 2013, 9:39:32 AM PDT
To: "netpolicy@mozilla.org" <Netpolicy@mozilla.org>
Subject: government shut down & open web
As you may already know many US government websites have shuttered, so to speak, as a result of the budget shut down. Reminds me of how Internet freedom issue campaigns have rallied attention by altering or closing websites.
Seems to me that this moment is a possible opportunity for Mozilla to educate the public about the importance of the open Web and how it is all around us every day.
During the previous shut down in the mid 90s people became fed up with a lack of access to government services such as visas for overseas travel. I don't know if it was a simple pressure point of very wealthy and well connected people that got fed up with Newt Gingrich and wanted to have their vacations to go forward. But that is one of the anecdotes one heard at the time.
Do people that care about the open Web care at all about a lack of access to government websites?
For example, people do care about a lack of access to national parks and how that disrupts their vacations, ruins the income to businesses dependent on those parks and pushes those workers into poverty and onto government assistance.
Is there an example that we can think of to make a similar cascading deprivation narrative connecting the shut down of government websites to a broader impact that burdens us all?
This I think would help underscore the point that Harvey made to me a year ago or so -- that the open Web needs to be a regular part of a kitchen table conversation, akin to what it took or many to move clean air out of the environmentalist extremes and into the very mainstream.
I can't say that the shut down of the US government is that tipping point for the open Web.
But since we've all seen the shuttering of websites as a timeworn tactic for two decades now, I thought I should raise it with you all here for contemplation and for discussion perhaps during the Mozilla Summit.
Peter
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From: "bryan" <bryan@bryanparker.org>
Date: October 4, 2013, 4:44:47 PM PDT
To: eddan@eddan.com
We are pulling together a tech forum to study the question of what would be needed in terms of infrastructure, marketing, resources, etc to drive a real tech sector in Oakland. Additionally, what are the restraints on this happening?
We were thinking 6-8 on 10/24. Policy discussion only, no politics. We have invited a group of tech professionals, capital providers and other thought leaders in the field. We think Oakland can make particular strides in the areas of Clean /Green tech and digital media.
Please let me know your thoughts.
Best,
Bryan-------------- next part --------------
This was meant to get sent out after Wednesday's meeting. Sorry it took so long.
In short, we are coming close to filing Sudoroom as a California
corporation. We want to do this as consensually and horizontally as
possible, but also soon. As in, the next few weeks. Let this e-mail
thread be your official opportunity to lobby objections, concerns and
desires. Here is some background for clarity, and some homework.
PROFIT vs NON-PROFIT: this is the distinction that gets talked about
most often, but actually seems to be the most remote/non-issue
question right now. 501 (c3, c5, c*) is a chapter of the Federal IRC,
meaning it ONLY relates to Federal income taxes. You ask the IRS to
recognize you, and they take a few years to start letting you keep
your money. But we're NOT AT THIS STAGE YET because legally we DON'T
even EXIST YET.
INCORPORATION: this is how you exist. It is not a federal process -
you ask your U.S. State to recognize you. Each state does it a little
differently. Generally the old traditional type of corporation is a
C-Corp, and newer types are LLC and B-Corp. This is something we all
need to learn more about! We need to decide the pros and cons of each
type. That is our homework assignment #1.
WRITING OUR ARTICLES: when we file papers we will have to submit
Articles/Bylaws. This will be a legal document describing who we are
and what the terms and rules of our incorporation are. It is
OPEN-ENDED meaning very hackable but also intimidating. It's been
proposed that we use Noisebridge's articles as a starting point and
edit them to our liking to make them most Sudo-appropriate. It's on
our wiki now: https://sudoroom.org/wiki/Bylaws_in_progress Reading,
understanding, and hacking at this document is homework assignment #2!
MEMBERSHIP: observant readers will note incorporation implies there
are "owners." We have to figure out once and for all how to decide
membership. This is it, folks. Time for us all to step up and ask "who
the fuck are we?"
So, in summary, the next steps are:
1) Decide on LLC vs C vs B Corp
2) Write articles/bylaws to file with
3) who the fuck are we?
_______________________________________________
sudo-discuss mailing list
sudo-discuss@lists.sudoroom.org
http://lists.sudoroom.org/listinfo/sudo-discuss
A few things about incorporation (I am not a lawyer, this is not legal
advice):
S corps: Last I checked these were limited to 35 owners, all of whom had
to be US citizens.
C corps: The entity most people think of when they say "corporation."
No limit to the number of owners, and owners may also be persons other
than US citizens.
B corps: A "B-corp" is a corporation that states a set of intrinsic
values & principles as part of its structure, supplementing or
supplanting the default assumption that the primary purpose to be served
is to increase shareholder value.
In each of the above structures, ownership shares are equal to dollars
invested, and the vote inheres in the shares rather than in the persons
(thus you can have unequal voting power based on share ownership).
There are possible mechanisms for a one-person/ one-vote system, based
on having two or more classes of shares, such as "preferred shares" and
"common shares." This enables you to have one class of shares that has
voting power, and one class of shares that does not have voting power
but has preference in allocation of dividends when profits are earned.
Thus for a one-person/ one-vote system, you'd sell only one share of
voting stock to each person, and as many shares of non-voting stock to
each person as matches their financial investment. Setting up this type
of system requires an attorney to ensure that it meets legal
requirements to protect the owners and investors.
In addition there are three types of co-operative structures, which are
also incorporated entities that confer the same "limited liability"
protections as other types of corporations:
"Consumer coops" also include most worker-owned coops, where individual
persons are the members and owners.
"Producer coops" serve individuals and companies that produce goods &
services, such as a dairy marketing coop that serves dairy farmers. In
this case, the members have some common interest in shared productive
resources such as infrastructure.
"Central organizations" are coops that have other coops as members, such
as a network of coops in a geographic area or common field of business,
or sharing infrastructure in the manner of a producer coop whose members
are coops.
In each of these cooperative structures, you have membership shares,
allocated one share to each member for a fixed price, such that each
member has one share and one vote. Thus the one-person/ one-vote
principle is built into the structure without need of multiple classes
of shares.
LLCs:
LLCs were originally designed as hybrid structures to accommodate groups
of professionals such as doctors and lawyers engaged in group practice,
but have since become used for other types of business, real estate
ownership, etc. LLCs were deliberately designed to be flexible in their
legal structure and methods of governance. In an LLC, the vote is also
separate from the investment share, such that you can create a
one-person/ one-vote system, with less complication than in a C-corp or
S-corp.
One thing to be careful of, for any type of legal entity, and this will
require legal advice to get it right, is to make sure that your share
price or membership price does not increase in a manner that you can't
control, such as to make it impossible for new persons to buy in.
This can occur when the primary asset is real estate, as the "assessed
value" of the property increases over time. This was historically a
problem in some forestry coops in the Pacific Northwest, and some other
cases that are known in the literature. I'm inclined to believe that
setting up a property as a "land trust" or similar entity, may be a
mechanism to hold the asset value of property more stable against
speculative increases in nearby property prices, and so reduce these
risks, but this needs to be checked with a lawyer.
Corporations and cooperatives, and possibly LLCs, have Boards of
Directors elected by the shareholders or members, and have three
positions that are required by law (any person may hold one or more of
these positions):
= Board of Directors: Elected directly by vote of the shareholders or
members (typically every two years). Makes policy decisions and selects
the positions below. For practical reasons the number of Directors
should be small enough to be able to meet without scheduling
difficulties, for example 5 - 7 people.
= CEO: Chief executive officer. Signs most legal documents for the
entity, can make other routine decisions per authority delegated by the
Board.
= CFO or Treasurer: Chief financial officer. Responsible for the
entity's financial documents and statements.
= Secretary: Responsible for receiving and for filing of routine
documents with various state agencies, and for maintaining
legally-required records of the organization.
= Attorney of Record, or Agent for Service of Process: This is not a
"CXO" type position, but is typically required to ensure that any
documents relating to legal processes, can go to a specific person at a
specific address.
All of the above structures, when configured for one-person/ one-vote,
are representative democracies.
To configure as a direct democracy of the members, Bylaws would be
enacted by the initial incorporators or first Board of Directors, such
that on specified issues, the Board is bound to act only in accord with
the direct votes of the members.
Thus you could empower the Board to make certain types of decisions on
its own, and other types of decisions only in accord with direct
democratic votes of the members.
When deciding on a structure, it's useful to consider the distinction
between the types of decisions that can be handled by "delegated
authority" such as by the Board, CEO, CFO, and Secretary, and the types
of decisions that you'd prefer to handle by direct vote of the members.
It's also useful to consider the threshold of direct vote required to
pass a proposal. The default options in most types of structures are
50%+1 for most types of decisions, and 2/3 majority for changes of the
Bylaws and other structural decisions. On the other hand, pure
consensus sets a 100% threshold, and varying degrees of near-consensus
can set other thresholds such as 80% for specified purposes.
One thing to keep in mind for Federal 501 tax-exempt organizations
(religious, scientific, educational, or charitable entities) is that the
law prohibits persons in decision-making capacities from receiving
monetary benefits from the entity. In discussions of
democratically-managed entities, this is usually interpreted to mean
that workers/employees/contractors of an entity, are not allowed to have
voting power, since they receive wages/salaries/etc. from the entity.
So to the extent that the entity expects to pay any of its members for
services they provide, or pay out any kind of dividendsre or
retained-earnings distributions, this issue will need to be considered,
and it also requires input from an attorney to get it right.
-G.
=====
On 13-10-05-Sat 6:13 PM, Yardena Cohen wrote:
This was meant to get sent out after Wednesday's meeting. Sorry it took
so long.
In short, we are coming close to filing Sudoroom as a California
corporation. We want to do this as consensually and horizontally as
possible, but also soon. As in, the next few weeks. Let this e-mail
thread be your official opportunity to lobby objections, concerns and
desires. Here is some background for clarity, and some homework.
PROFIT vs NON-PROFIT: this is the distinction that gets talked about
most often, but actually seems to be the most remote/non-issue
question right now. 501 (c3, c5, c*) is a chapter of the Federal IRC,
meaning it ONLY relates to Federal income taxes. You ask the IRS to
recognize you, and they take a few years to start letting you keep
your money. But we're NOT AT THIS STAGE YET because legally we DON'T
even EXIST YET.
INCORPORATION: this is how you exist. It is not a federal process -
you ask your U.S. State to recognize you. Each state does it a little
differently. Generally the old traditional type of corporation is a
C-Corp, and newer types are LLC and B-Corp. This is something we all
need to learn more about! We need to decide the pros and cons of each
type. That is our homework assignment #1.
WRITING OUR ARTICLES: when we file papers we will have to submit
Articles/Bylaws. This will be a legal document describing who we are
and what the terms and rules of our incorporation are. It is
OPEN-ENDED meaning very hackable but also intimidating. It's been
proposed that we use Noisebridge's articles as a starting point and
edit them to our liking to make them most Sudo-appropriate. It's on
our wiki now: https://sudoroom.org/wiki/Bylaws_in_progress Reading,
understanding, and hacking at this document is homework assignment #2!
MEMBERSHIP: observant readers will note incorporation implies there
are "owners." We have to figure out once and for all how to decide
membership. This is it, folks. Time for us all to step up and ask "who
the fuck are we?"
So, in summary, the next steps are:
1) Decide on LLC vs C vs B Corp
2) Write articles/bylaws to file with
3) who the fuck are we?
_______________________________________________
sudo-discuss mailing list
sudo-discuss@lists.sudoroom.org
http://lists.sudoroom.org/listinfo/sudo-discuss
_______________________________________________
sudo-discuss mailing list
sudo-discuss@lists.sudoroom.org
http://lists.sudoroom.org/listinfo/sudo-discuss
-------------- next part --------------
I had just started to write something similar to G's email, having gone
through the incorporation process a few times for C-corps and non-profits
in the past couple years -- I'm certainly not a lawyer and this is
definitely not legal advice.
G's notes match mine on all points but one: My understanding is that in a
501c3 non-profit, decision-makers *are* allowed to receive pay from the
organization, however, they should recuse themselves from discussions of
their own pay. (That pay also has to be "reasonable".)
Just to add a few more thoughts to the mix:
On B-Corps: A "B Corp" isn't actually a separate legal structure, so we
would be a B Corp *in addition* to a C-Corp or LLC or non-profit or other
structure we chose, not *instead of*.
On non-profit status: Being a non-profit bring advantages beyond just
being exempt from federal income tax:
+ Many foundations and charities only give to non-profits, if we were one,
we could apply for grants and stuff.
+ Individuals can deduct donations to non-profits from their own income
taxes
+ California waives the $800 annual minimum franchise tax for non-profits
+ Many companies have donation matching programs, where employees who
donate $XXXX to a non-profit will see that contribution matched by their
employer, yielding 2*$XXXX for the non-profit.
+ No one owns the organization in a non-profit. There are no shares, and
no issues with valuing those shares if the organization owns property and
that property appreciates in value. There can be members, and the rights of
the members would be chosen by us, and are described in the bylaws of the
organization. (Noisebridge's bylaws<https://www.noisebridge.net/images/4/47/Noisebridge-bylaws-as-filed.pdf>,
for reference.) One-member/one-vote is quite typical.
My best guess would be that sudoroom should probably be a non-profit. In
this structure, there would be a Board of Directors, whose actions could be
constrained by the by-laws to act as the members direct.
I'm happy to answer any questions folks might have. The wednesday meetings
have been tough for me to attend over the last few months, but I hope to
make it to more in the future!
Best,
J.D.
On Sat, Oct 5, 2013 at 7:40 PM, GtwoG PublicOhOne <g2g-public01@att.net>wrote:
A few things about incorporation (I am not a lawyer, this is not legal
advice):
S corps: Last I checked these were limited to 35 owners, all of whom had
to be US citizens.
C corps: The entity most people think of when they say "corporation."
No limit to the number of owners, and owners may also be persons other
than US citizens.
B corps: A "B-corp" is a corporation that states a set of intrinsic
values & principles as part of its structure, supplementing or
supplanting the default assumption that the primary purpose to be served
is to increase shareholder value.
In each of the above structures, ownership shares are equal to dollars
invested, and the vote inheres in the shares rather than in the persons
(thus you can have unequal voting power based on share ownership).
There are possible mechanisms for a one-person/ one-vote system, based
on having two or more classes of shares, such as "preferred shares" and
"common shares." This enables you to have one class of shares that has
voting power, and one class of shares that does not have voting power
but has preference in allocation of dividends when profits are earned.
Thus for a one-person/ one-vote system, you'd sell only one share of
voting stock to each person, and as many shares of non-voting stock to
each person as matches their financial investment. Setting up this type
of system requires an attorney to ensure that it meets legal
requirements to protect the owners and investors.
In addition there are three types of co-operative structures, which are
also incorporated entities that confer the same "limited liability"
protections as other types of corporations:
"Consumer coops" also include most worker-owned coops, where individual
persons are the members and owners.
"Producer coops" serve individuals and companies that produce goods &
services, such as a dairy marketing coop that serves dairy farmers. In
this case, the members have some common interest in shared productive
resources such as infrastructure.
"Central organizations" are coops that have other coops as members, such
as a network of coops in a geographic area or common field of business,
or sharing infrastructure in the manner of a producer coop whose members
are coops.
In each of these cooperative structures, you have membership shares,
allocated one share to each member for a fixed price, such that each
member has one share and one vote. Thus the one-person/ one-vote
principle is built into the structure without need of multiple classes
of shares.
LLCs:
LLCs were originally designed as hybrid structures to accommodate groups
of professionals such as doctors and lawyers engaged in group practice,
but have since become used for other types of business, real estate
ownership, etc. LLCs were deliberately designed to be flexible in their
legal structure and methods of governance. In an LLC, the vote is also
separate from the investment share, such that you can create a
one-person/ one-vote system, with less complication than in a C-corp or
S-corp.
One thing to be careful of, for any type of legal entity, and this will
require legal advice to get it right, is to make sure that your share
price or membership price does not increase in a manner that you can't
control, such as to make it impossible for new persons to buy in.
This can occur when the primary asset is real estate, as the "assessed
value" of the property increases over time. This was historically a
problem in some forestry coops in the Pacific Northwest, and some other
cases that are known in the literature. I'm inclined to believe that
setting up a property as a "land trust" or similar entity, may be a
mechanism to hold the asset value of property more stable against
speculative increases in nearby property prices, and so reduce these
risks, but this needs to be checked with a lawyer.
Corporations and cooperatives, and possibly LLCs, have Boards of
Directors elected by the shareholders or members, and have three
positions that are required by law (any person may hold one or more of
these positions):
= Board of Directors: Elected directly by vote of the shareholders or
members (typically every two years). Makes policy decisions and selects
the positions below. For practical reasons the number of Directors
should be small enough to be able to meet without scheduling
difficulties, for example 5 - 7 people.
= CEO: Chief executive officer. Signs most legal documents for the
entity, can make other routine decisions per authority delegated by the
Board.
= CFO or Treasurer: Chief financial officer. Responsible for the
entity's financial documents and statements.
= Secretary: Responsible for receiving and for filing of routine
documents with various state agencies, and for maintaining
legally-required records of the organization.
= Attorney of Record, or Agent for Service of Process: This is not a
"CXO" type position, but is typically required to ensure that any
documents relating to legal processes, can go to a specific person at a
specific address.
All of the above structures, when configured for one-person/ one-vote,
are representative democracies.
To configure as a direct democracy of the members, Bylaws would be
enacted by the initial incorporators or first Board of Directors, such
that on specified issues, the Board is bound to act only in accord with
the direct votes of the members.
Thus you could empower the Board to make certain types of decisions on
its own, and other types of decisions only in accord with direct
democratic votes of the members.
When deciding on a structure, it's useful to consider the distinction
between the types of decisions that can be handled by "delegated
authority" such as by the Board, CEO, CFO, and Secretary, and the types
of decisions that you'd prefer to handle by direct vote of the members.
It's also useful to consider the threshold of direct vote required to
pass a proposal. The default options in most types of structures are
50%+1 for most types of decisions, and 2/3 majority for changes of the
Bylaws and other structural decisions. On the other hand, pure
consensus sets a 100% threshold, and varying degrees of near-consensus
can set other thresholds such as 80% for specified purposes.
One thing to keep in mind for Federal 501 tax-exempt organizations
(religious, scientific, educational, or charitable entities) is that the
law prohibits persons in decision-making capacities from receiving
monetary benefits from the entity. In discussions of
democratically-managed entities, this is usually interpreted to mean
that workers/employees/contractors of an entity, are not allowed to have
voting power, since they receive wages/salaries/etc. from the entity.
So to the extent that the entity expects to pay any of its members for
services they provide, or pay out any kind of dividendsre or
retained-earnings distributions, this issue will need to be considered,
and it also requires input from an attorney to get it right.
-G.
=====
On 13-10-05-Sat 6:13 PM, Yardena Cohen wrote:
This was meant to get sent out after Wednesday's meeting. Sorry it took
so long.
In short, we are coming close to filing Sudoroom as a California
corporation. We want to do this as consensually and horizontally as
possible, but also soon. As in, the next few weeks. Let this e-mail
thread be your official opportunity to lobby objections, concerns and
desires. Here is some background for clarity, and some homework.
PROFIT vs NON-PROFIT: this is the distinction that gets talked about
most often, but actually seems to be the most remote/non-issue
question right now. 501 (c3, c5, c*) is a chapter of the Federal IRC,
meaning it ONLY relates to Federal income taxes. You ask the IRS to
recognize you, and they take a few years to start letting you keep
your money. But we're NOT AT THIS STAGE YET because legally we DON'T
even EXIST YET.
INCORPORATION: this is how you exist. It is not a federal process -
you ask your U.S. State to recognize you. Each state does it a little
differently. Generally the old traditional type of corporation is a
C-Corp, and newer types are LLC and B-Corp. This is something we all
need to learn more about! We need to decide the pros and cons of each
type. That is our homework assignment #1.
WRITING OUR ARTICLES: when we file papers we will have to submit
Articles/Bylaws. This will be a legal document describing who we are
and what the terms and rules of our incorporation are. It is
OPEN-ENDED meaning very hackable but also intimidating. It's been
proposed that we use Noisebridge's articles as a starting point and
edit them to our liking to make them most Sudo-appropriate. It's on
our wiki now: https://sudoroom.org/wiki/Bylaws_in_progress Reading,
understanding, and hacking at this document is homework assignment #2!
MEMBERSHIP: observant readers will note incorporation implies there
are "owners." We have to figure out once and for all how to decide
membership. This is it, folks. Time for us all to step up and ask "who
the fuck are we?"
So, in summary, the next steps are:
1) Decide on LLC vs C vs B Corp
2) Write articles/bylaws to file with
3) who the fuck are we?
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