Provisional Articles of Incorporation, notes

This document supersedes completely the previously-published Provisional Charter for Pizarro.

Mircea Popescu and Diana Coman needled me on the lack of clear separation between mod6 and my roles as chairs of The Bitcoin Foundation, chairs of Pizarro, and my management of the new entity. Discussion in the forum led me to wholly reformulate the entity's structure.

The Foundation Makes a Loan

As The Bitcoin Foundation has been graciously capitalized by The Most Serene Republic, the state of emergency continues with only incremental progress, and the continued failure to deliver an internet service provider threatens the nascent Republic's very existence, mod6 and ben_vulpes have extended 1 BTC of The Bitcoin Foundation's capital to a new corporate entity in bridge credit, buying time to wind down BISP and instantiate a new entity.

Capitalization and Liabilities

Including estimated wire costs, the outstanding DC liability sits at 61615.26 USD; payroll costs to retain BingoBoingo's services, to ensure a usable work environment, pay local taxes etc, for the duration of the contract total 38,434 USD; both sum to 100,049.26 USD.

The DC liability is lower than one might estimate, as the final month of the contract has been prepaid; and the payroll charges are higher than early reports from BISP would indicate, as in exchange for residency permits, bank accounts, and a local corporate entity with which to enter into contract with the data center, the local state has levied significant taxes.

The capitalization proposed below totals an estimated 112.4KUSD, coincidentally only of the same order of magnitude as the operating costs for the remainder of the contract with the data center. Should additional capitalization prove necessary for more racks or more machines, the following corporate structure allows for management to sell more shares in the corporation or issue debt at their discretion. This entity is capitalized in BTC and the USD numbers quoted above merely a convenience for readers. Forex risks are not to be downplayed in the analysis of this corporate structure.

Provisional Articles of Incorporation

This agreement is entered into by BingoBoingo (identified by GPG fingerprint ADD7 A9A2 8F85 E5EF 1F51 904F 309B B8D7 F325 1143), asciilifeform (identified by GPG fingerprint 1721 5D11 8B72 3950 7FAF ED98 B982 28A0 01AB FFC7), mod6 (identified by GPG fingerprint 027A 8D7C 0FB8 A166 4372 0F40 7217 05A8 B71E ADAF) and ben_vulpes (identified by GPG fingerprint 4F79 0794 2CA8 B89B 01E2 5A76 2AFA 1A9F D2D0 31DA).

Pizarro ISP (Pizarro) shall incorporate with 1,000,000 shares, selling 500,000 each to mod6 and asciilifeform at a value of 0.00001 BTC each, for a total equity value of 10 BTC. Pizarro shares have no voting rights.

asciilifeform, mod6, and the chairmen of The Bitcoin Foundation will each appoint one board member, hire ben_vulpes to manage Pizarro, and hire BingoBoingo to perform remote hands labor. ben_vulpes shall direct day-to-day operations, produce monthly AN0 statements, and consult with The Board, The Republic and Pizarro's customers at his discretion. mod6 shall manage customer relations, and asciilifeform shall have remit of all electronics and software; directing BingoBoingo's work as appropriate and at asciilifeform's discretion.

Pizarro ISP shall issue Special Stock Warrants for 100,000 shares to ben_vulpes and 10,000 shares to BingoBoingo at a price per share of 0.00001 BTC, redeemable 1 year from the signing of this contract by all parties.

Should any member of the board or the hired manager withdraw or fail to meet their obligations, or should the board determine that the operation cannot continue as a going concern, this entity shall terminate, liquidate, and provide BingoBoingo 0.25 BTC in parachute. asciilifeform will pay for BingoBoingo's plane ticket home out of his own pocket, with mod6 as backstop and ben_vulpes as secondary backstop.

This agreement is entered into by BingoBoingo (identified by GPG fingerprint ADD7 A9A2 8F85 E5EF 1F51 904F 309B B8D7 F325 1143), asciilifeform (identified by GPG fingerprint 1721 5D11 8B72 3950 7FAF ED98 B982 28A0 01AB FFC7), mod6 (identified by GPG fingerprint 027A 8D7C 0FB8 A166 4372 0F40 7217 05A8 B71E ADAF) and ben_vulpes (identified by GPG fingerprint 1D02 5EF0 42F9 A50A 7159 C01C F6AC 75A1 CE34 15E4).

Pizarro ISP (Pizarro) shall incorporate with 1,000,000 shares, selling 500,000 each to mod6 and asciilifeform at a value of 0.00001 BTC each, for a total equity value of 10 BTC. Pizarro shares have no voting rights.

asciilifeform, mod6, and the chairmen of The Bitcoin Foundation will each appoint one board member, hire ben_vulpes to manage Pizarro, and hire BingoBoingo to perform remote hands labor. ben_vulpes shall direct day-to-day operations, produce monthly AN0 statements, and consult with The Board, The Republic and Pizarro's customers at his discretion.

Pizarro ISP shall issue Special Stock Warrants for 100,000 shares to ben_vulpes and 10,000 shares to BingoBoingo at a price per share of 0.00001 BTC, redeemable 1 year from the signing of this contract by all parties.

Should any member of the board or the hired manager withdraw or fail to meet their obligations, or should the board determine that the operation cannot continue as a going concern, this entity shall terminate, liquidate, and provide BingoBoingo 0.25 BTC in parachute. asciilifeform will pay for the ticket out of his own pocket, with mod6 as backstop and ben_vulpes as secondary backstop.

5 Responses to “Provisional Articles of Incorporation, notes”

  1. mod6 says:

    1: Will the foundation receive any shares for its 1 BTC contribution?

    2: Where will the shares be issued? Or are they simply just to remain non-transferrable and a line item on the AN0 sheet?

    3: From the language of paragraph 3, it sounds like asciilifeform, mod6 and Both Co-Chairs can each appoint one board member. A total of three board members will exist. Can an elected/appointed board member give up his seat at any time for another person? Or if not is the term of the board seat for the existance of the entity?

    4: Where should mod6's and asciilifeform's, and whatever remaining Bitcoin Foundation funds be sent? Do we need a public address to pay these to?

  2. mod6 says:

    Any thoughts on changing:

    "asciilifeform will pay for the ticket out of his own pocket, with mod6 as backstop and ben_vulpes as secondary backstop."

    to

    "asciilifeform will pay for BingoBoingo's plane ticket home out of his own pocket, with mod6 as backstop and ben_vulpes as secondary backstop."

    Thanks in advance!

  3. ben_vulpes says:

    mod6,

    > 1.

    The Foundation's made a loan, so it'll sit on the books as a convertible note and will convert to stock at the same time any other note would; when the Foundation chooses to press for a conversion (or payment) or when Pizarro's Board elects to convert the debt. It will convert at a rate negotiated at that time.

    > 2.

    The shares are issued by fiat; the company will not be listed on any formal exchanges, such being wildly premature. Nevertheless nothing prohibits stockholders from selling their shares at any time should they choose to.

    > 3.

    The term of the board appointment has gotta be defined by the entity doing the appointing and the entity doing the sitting. The three shall each hold a board seat for the duration of the entity or until the articles of incorporation are amended (which naturally, the board has the power to do). Appointed board members may be removed from their board seats by the appointing party or resign per their agreement with whomever appointed them; and while in theory a seat may remain vacant, in practice it'll be a small matter for the appointing party to appoint another or seat themselves.

    > 4.

    I'll get a public address set up shortly; let's focus on getting the articles signed first.

    > plane ticket

    Fine suggestion; look for it in the next draft.

  4. BingoBoingo says:

    Looks good

  5. mod6 says:

    Aha, sounds good. Thanks for the clear and thoughtful reaponses to my queries ben_vulpes!

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