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Start drafting an operating agreement
Closes #72.
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nav_title = "Operating Agreement" | ||
nav_children = [] | ||
[---] | ||
[---] text/html via markdown | ||
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Gratipay, LLC is a worker-owned cooperative, organized under and subject to the | ||
laws of the Commonwealth of Pennsylvania in the United States of America. In | ||
this document, “Gratipay,” “the company,” and | ||
“the cooperative” refer to Gratipay, LLC. This is the operating | ||
agreement that defines how the members of Gratipay govern the cooperative, | ||
manage its money, and share its profits and losses. | ||
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## Basic Definitions | ||
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A cooperative is a democratically governed, for-profit company. Non-cooperative | ||
companies weight power by equity, one vote per share. Cooperatives distribute | ||
power according to the fundamental equality of all individuals, “one | ||
member, one vote.” Gratipay subscribes to the [principles and values of | ||
the cooperative movement](./values), and intends for this operating agreement | ||
to be consistent with those values. | ||
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An LLC is a Limited Liability Company, a flexible legal structure that protects | ||
its owners from legal liability, while avoiding the double-taxation that comes | ||
with other corporate structures. | ||
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Not all LLCs are cooperatives, and not all cooperatives are LLCs, but an LLC | ||
can be a good choice for structuring a cooperative. An LLC is an especially | ||
compelling choice for Gratipay because of the diverse international composition | ||
of our expected membership (this is easier handled with an LLC), and because we | ||
were already structured as a single-member LLC before we evolved into a | ||
cooperative. | ||
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## Membership | ||
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Gratipay is a member-managed company (we are not manager-managed). That is, all | ||
members share in both the work of the cooperative and its profits and loses | ||
(“active” members), as opposed to only sharing in the profits and | ||
losses without sharing in the work (“passive” members). Members are | ||
natural persons (also called “individuals” in this document). | ||
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Members may bind the company. | ||
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Gratipay invites new members by a vote of 75% of the existing membership. The | ||
way to earn an invitation is to [collaborate in our work](./welcome) for a long | ||
time. | ||
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Members may remove themselves from Gratipay at any time. Gratipay may remove a | ||
member against their will for any reason at any time, by a vote of 75% of the | ||
remaining membership. Gratipay automatically and immediately removes a member | ||
(no vote required) if they: | ||
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- abstain from three votes in a row, | ||
- spend money without authorization, or | ||
- violate the [code of conduct](../howto/behave-well). | ||
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Gratipay may reinvite an individual at any time, with the exception that an | ||
individual removed twice for spending money without authorization and/or | ||
violating the code of conduct may not be invited ever again. | ||
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### Records | ||
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Gratipay maintains membership records as follows: .... | ||
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## Governance | ||
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Gratipay makes decisions in online [channels](../appendices/channels), | ||
primarily GitHub. The basic procedure is to announce an intention and leave it | ||
out there for a certain amount of time. If no-one objects then do it. If | ||
another member objects then work it out. If you can't work it out then we vote. | ||
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Any member may call for a vote on anything at any time. Voting is open for one | ||
week, and a simple majority (50%) carries the proposal. The quorum is: | ||
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- 100% if there are fewer than seven members, | ||
- seven if there are at least seven but fewer than 35 members, and | ||
- 20% (rounded down) if there are 35 or more members. | ||
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Members cast votes using comments and/or reactions on GitHub issues. Every | ||
member is responsible for counting the vote. | ||
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The following decisions always require a vote with a two-week voting period and | ||
75% needed to pass: | ||
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- changing [the big picture](./), | ||
- removing a member against their will, | ||
- selling or dissolving Gratipay, and | ||
- accepting outside financing. | ||
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Gratipay is open-source software. In the case of irreconcilable conflict, | ||
members in the minority always have the option to fork. | ||
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### Records | ||
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Gratipay maintains governance records in GitHub. | ||
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## Money | ||
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guaranteed payments, retained earnings, profit distributions | ||
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twyw for all, ya? | ||
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Members are entitled to a debit card, and are authorized to spend up to an | ||
equal share of Gratipay's operating cash in a given calendar month, based on | ||
the account balance and the number of members at the end of the previous month. | ||
For example, if at the end of April the account balance is $10,000 and the | ||
number of members is eight, then each member is authorized to spend up to | ||
$1,250 in May. As discussed above, all members have access to Gratipay's | ||
financial statements to inform their decision-making. | ||
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All expenses must be authorized by one or more members. If authorized by more | ||
than one member then expenses count against their monthly allocation in a ratio | ||
determined by consensus of the members involved. So, for example, a bill for | ||
$100 might be authorized by three members at 50%, 30%, and 20%, so that their | ||
monthly allocations would . | ||
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### Profits and Losses | ||
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capital contributions, capital accounts | ||
guaranteed payments, retained earnings, profit distributions | ||
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twyw for all, ya? | ||
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### Records. | ||
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Gratipay maintains financial records in GitHub and on Inside Gratipay. |