Commentary-12

In contrast to the archetypical Berle-Means corporation, characterized by delegation to day-to-day management, frequent board meetings and annual general meetings of shareholders, the current technical reality of DAOs means that any decision for an action is taken by way of Proposal, such that all On-Chain interactions may be considered part of a continuously ongoing online general meeting. Questions may be asked at any time and Proposals can be submitted continuously. This form of direct participation makes the separate organization of a Meeting redundant and potentially cumbersome. However, there may be DAOs which may find it necessary to organize Meetings, between Administrators, between Members or Participants and between all three, a need that can be met through appropriate provisions in the By-Laws. The global and digital nature of DAOs, in addition to the desire to preserve the anonymity/pseudonymity of stakeholders, militates against the holding of physical Meetings. If such in-person Meetings are compulsorily held, this should be specified in the By-Laws.

If Meetings are required in a DAO, the requirement in Article 12(3) can be fulfilled through the practice of submitting a Proposal to a DAO as a suggestion for actions to be taken by the DAO, with this Proposal clearly visible on a GUI and open for a defined time period (e.g., 2 weeks) for deliberation and voting. The Article 12(4) requirements as to quorum and majority voting requirements can be technically set to prevent a Proposal from passage with insufficient quorum or by less than majority support.