Finally figured out best way to iterate with claude
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## CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM
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THESE SECURITIES HAVE NOT BEEN REGISTERED WITH OR APPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE, NOR HAS THE COMMISSION OR ANY SUCH AUTHORITY PASSED UPON THE ACCURACY OR ADEQUACY OF THIS MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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**IMPORTANT NOTICE: PLEASE READ CAREFULLY BEFORE PROCEEDING**
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THIS MEMORANDUM DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITY OTHER THAN THE SECURITIES OFFERED HEREBY, NOR DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO.
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THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED WITH OR APPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION (THE “SEC”) OR THE SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION. THIS OFFERING IS BEING MADE IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), SPECIFICALLY SECTION 4(A)(2) THEREOF AND RULE 506(C) OF REGULATION D PROMULGATED THEREUNDER, AND SIMILAR EXEMPTIONS UNDER APPLICABLE STATE SECURITIES LAWS.
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THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. THIS INVESTMENT IS SUITABLE ONLY FOR PERSONS WHO CAN BEAR THE ECONOMIC RISK FOR AN INDEFINITE PERIOD OF TIME AND WHO CAN AFFORD TO LOSE THEIR ENTIRE INVESTMENT. FURTHERMORE, INVESTORS MUST UNDERSTAND THAT SUCH INVESTMENT IS ILLIQUID AND IS EXPECTED TO CONTINUE TO BE ILLIQUID FOR AN INDEFINITE PERIOD OF TIME. NO PUBLIC MARKET EXISTS FOR THE SECURITIES.
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THIS MEMORANDUM CONSTITUTES AN OFFER ONLY TO THE PERSON TO WHOM IT IS DELIVERED BY THE COMPANY AND DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES OFFERED HEREBY, NOR DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY TO ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO.
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THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS OR THE LAWS OF ANY FOREIGN JURISDICTION. THE SECURITIES ARE BEING OFFERED AND SOLD UNDER THE EXEMPTION PROVIDED BY SECTION 4(A)(2) OF THE ACT AND REGULATION D PROMULGATED THEREUNDER AND OTHER EXEMPTIONS OF SIMILAR IMPORT IN THE LAWS OF THE STATES AND OTHER JURISDICTIONS WHERE THE OFFERING WILL BE MADE. THE COMPANY WILL NOT BE REGISTERED AS AN INVESTMENT COMPANY UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE "INVESTMENT COMPANY ACT").
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THESE SECURITIES ARE OFFERED ONLY TO INVESTORS WHO QUALIFY AS “ACCREDITED INVESTORS” AS DEFINED IN RULE 501(A) OF REGULATION D UNDER THE SECURITIES ACT. THE COMPANY WILL REQUIRE VERIFICATION OF INVESTOR QUALIFICATION IN ACCORDANCE WITH RULE 506(C) REQUIREMENTS.
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PROSPECTIVE INVESTORS SHOULD NOT CONSTRUE THE CONTENTS OF THIS MEMORANDUM AS LEGAL, TAX, INVESTMENT OR OTHER ADVICE. EACH INVESTOR SHOULD MAKE THEIR OWN INQUIRIES AND CONSULT THEIR OWN ADVISORS AS TO THE APPROPRIATE TAX TREATMENT, LEGAL, FINANCIAL, AND OTHER MATTERS RELEVANT TO THE SUITABILITY OF AN INVESTMENT IN THE SECURITIES OF THE COMPANY FOR SUCH INVESTOR.
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THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK AND IS SUITABLE ONLY FOR PERSONS WHO CAN BEAR THE ECONOMIC RISK OF LOSING THEIR ENTIRE INVESTMENT. EACH INVESTOR MUST HAVE THE ABILITY TO SUSTAIN THE LOSS OF THEIR ENTIRE INVESTMENT WITHOUT A MATERIAL ADVERSE EFFECT ON THEIR FINANCIAL CONDITION. INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
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THE SECURITIES OFFERED HEREBY ARE SUBJECT TO SIGNIFICANT RESTRICTIONS ON TRANSFER, AND RESALE MAY BE DIFFICULT OR IMPOSSIBLE FOR AN INDEFINITE PERIOD OF TIME. NO PUBLIC MARKET EXISTS FOR THE SECURITIES, AND NO PUBLIC MARKET IS EXPECTED TO DEVELOP.
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THE COMPANY WILL NOT BE REGISTERED AS AN INVESTMENT COMPANY UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “INVESTMENT COMPANY ACT”), IN RELIANCE ON THE EXEMPTIONS PROVIDED BY SECTION 3(C)(1) OR 3(C)(7) THEREOF.
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PROSPECTIVE INVESTORS SHOULD NOT CONSTRUE THE CONTENTS OF THIS MEMORANDUM AS LEGAL, BUSINESS, TAX, ACCOUNTING, INVESTMENT, OR OTHER ADVICE. EACH INVESTOR SHOULD CONSULT WITH THEIR OWN ATTORNEYS, ACCOUNTANTS, AND OTHER PROFESSIONAL ADVISORS REGARDING THE LEGAL, TAX, FINANCIAL, AND OTHER MATTERS CONCERNING AN INVESTMENT IN THE COMPANY.
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NO REPRESENTATIONS OR WARRANTIES OF ANY KIND ARE MADE OR INTENDED, AND NONE SHOULD BE INFERRED, WITH RESPECT TO THE ECONOMIC RETURN OR THE TAX CONSEQUENCES FROM AN INVESTMENT IN THE COMPANY. NO ASSURANCE CAN BE GIVEN THAT EXISTING LAWS WILL NOT BE CHANGED OR INTERPRETED ADVERSELY.
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## ARTICLE 1 - RECITALS
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### Section 1.1 - Prior Agreement
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This Amended and Restated Operating Agreement (the "Agreement") supersedes and replaces in its entirety that certain Operating Agreement of Turnkey Network Systems LLC dated [ORIGINAL DATE] (the "Prior Agreement").
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This Amended and Restated Operating Agreement (the “Agreement”) is made and entered into effective as of [INSERT EFFECTIVE DATE] (the “Effective Date”), by and among Turnkey Network Systems LLC, a Texas series limited liability company (the “Company”), and the members of the Company. This Agreement supersedes and replaces in its entirety that certain Operating Agreement of Turnkey Network Systems LLC dated [INSERT ORIGINAL DATE] (the “Prior Agreement”).
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### Section 1.2 - Purpose of Amendment and Restatement
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The Member desires to amend and restate the Prior Agreement to:
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The Company desires to amend and restate the Prior Agreement to implement comprehensive changes to the Company’s governance, operational structure, and capital framework, including without limitation:
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- implement mandatory service provider requirements,
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- establish the governance structure under the Board.
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- adopt sociocratic principles
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- Specify the LLC and its series does not grant any capital interests and does not maintain capital accounts
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- Specify that instead of capital accounts and interests , the series of this LLC uses profit interests exclusively.
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- establish a mandatory three class system for profit interests at a minimum for all series
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- reaffirm and reestablish the authority for the creation of operating entities series
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- establish the authority for the creation of asset holding, non operational entities series
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- establish the authority for the creation of subsidiary semi autonomous Cell entities series
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1. **Governance Structure**: Establishing a formalized governance structure under a Board of Directors and implementing sociocratic principles to provide both centralized strategic oversight and distributed operational decision-making;
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2. **Service Provider Framework**: Implementing mandatory internal service provider requirements to ensure operational consistency, quality control, and economies of scale across all series;
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3. **Capital Structure Revision**: Specifying that the LLC and its series shall not grant any capital interests or maintain capital accounts, and shall instead utilize profit interests exclusively through a mandatory three-class system for all series;
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4. **Series Framework Enhancement**: Reaffirming and enhancing the authority for the creation of:
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- Operating entity series
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- Asset-holding, non-operational entity series
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- Semi-autonomous Cell entity series
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5. **Operational Standards**: Establishing uniform operational standards, electronic recordkeeping requirements, and compliance protocols to ensure consistent operations across all series while maintaining series isolation;
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6. **Investor Protection**: Strengthening investor protections through enhanced disclosure requirements, standardized membership interest classifications, and clear transfer restrictions.
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### Section 1.3 - Effect of Amendment and Restatement
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Upon execution of this Agreement:
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- The Prior Agreement shall be superseded in its entirety.
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- All prior amendments to the Prior Agreement shall be void.
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- All rights and obligations under the Prior Agreement shall terminate.
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1. **Prior Agreement Termination**: The Prior Agreement is hereby superseded in its entirety and shall be of no further force or effect. All prior amendments to the Prior Agreement are hereby void.
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- All previous written and verbal agreements, understandings, contracts, and commitments of any kind made by or on behalf of:
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- Charles Wyble
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- Turnkey Network Systems LLC
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- Turnkey Network Systems Partnership
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- Turnkey Network Systems sole proprietorship
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are hereby terminated, rescinded, and rendered null and void in their entirety with immediate effect.
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- No party shall have any continuing obligations, rights, or duties under any such prior agreements.
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- This Agreement shall govern all aspects of the Company's operations going forward.
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2. **Rights and Obligations**: All rights, obligations, and relationships under the Prior Agreement are hereby terminated, and all parties shall hereafter be governed solely by the terms of this Agreement.
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3. **Prior Commitments Termination**: All previous written and verbal agreements, understandings, contracts, and commitments of any kind made by or on behalf of:
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- Charles Wyble
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- Turnkey Network Systems LLC
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- Turnkey Network Systems Partnership
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- Turnkey Network Systems sole proprietorship
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are hereby terminated, rescinded, and rendered null and void in their entirety with immediate effect.
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4. **Continuation of Business**: Notwithstanding the termination of prior agreements, the business of the Company shall continue without interruption or dissolution. The adoption of this Agreement shall not constitute a termination or dissolution of the Company.
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5. **Forward-Looking Governance**: This Agreement shall govern all aspects of the Company’s operations from the Effective Date forward. No party shall have any continuing obligations, rights, or duties under any prior agreements.
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6. **Binding Effect**: This Agreement shall be binding upon, and inure to the benefit of, all current and future series members, officers, directors, and representatives of the Company and its series.
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## ARTICLE 2 - GLOSSARY OF TERMS
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@@ -173,76 +189,59 @@ other digital formats approved by the Company Committee.
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## ARTICLE 3 - MANDATORY OPERATIONAL REQUIREMENTS
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## Section 3.1 - Internal Shared Services Structure
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The Company hereby specifies the following series as primary internal shared service providers:
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### 1. Designation of Internal Service Providers
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a. Known Element Enterprises (series) LLC shall serve as the Company’s primary information technology provider, offering all IT services as defined in Section 2.1.7.
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The Company hereby establishes the following series as internal shared service providers:
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b. The Campus Trading Company (series) LLC shall serve as the Company’s primary treasury and transaction operations provider, offering all transaction services as defined in Section 2.1.13.
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a. Known Element Enterprises (series) LLC shall serve as the Company's centralized information technology division, providing all IT services as defined in Section 2.1.7.
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### 2. Service Provider Requirements
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b. The Campus Trading Company (series) LLC shall serve as the Company's centralized treasury and transaction operations division, providing all transaction services as defined in Section 2.1.13.
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a. **Primary Use Requirement**: All series shall utilize these internal service providers as their primary service solutions, subject to the following:
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### 2. Mandatory Use of Internal Services
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i. **Performance Standards**: Internal service providers must meet or exceed industry standard service level agreements (SLAs) established by the Technology Oversight Committee.
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ii. **Competitive Pricing**: Internal service providers must offer services at pricing comparable to market rates for equivalent services, as verified annually by independent audit.
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All series must exclusively utilize these internal service divisions for their respective functions. No series may:
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b. **Service Provider Failure Remedies**: If an internal service provider fails to meet established performance standards for two consecutive quarters:
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a. Develop independent IT systems or capabilities
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i. The affected series may petition the Technology Oversight Committee for a temporary waiver to use external providers.
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ii. The Technology Oversight Committee must respond to such petitions within 30 days.
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iii. If approved, waivers shall be granted for a specific scope and duration.
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b. Establish independent banking or treasury relationships
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c. **Innovation Exception**: Series may request permission to utilize specialized external services not offered by internal providers when:
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c. Contract directly with external service providers for these functions
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Series may (and are encouraged to) establish series specific contract terms with Known Element Enterprise and The Campus Trading Company to meet the series unique needs.
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i. The service represents a significant competitive advantage.
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ii. The internal service provider cannot reasonably develop equivalent capabilities within 90 days.
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iii. Such exceptions require Technology Oversight Committee approval.
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### 3. Service Division Operations
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a. Each service division shall:
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* Operate as a cost center pursuant to Section 4.6.5
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* Maintain transparent cost accounting
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* Be subject to Board oversight through appropriate committees
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* Select and manage external vendors as needed
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* Develop and maintain appropriate service standards
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* Operate as a cost center pursuant to Section 4.6.5
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* Maintain transparent cost accounting
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* Be subject to Board oversight through appropriate committees
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* Select and manage external vendors as needed
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* Develop and maintain appropriate service standards
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* Conduct annual customer satisfaction surveys among series
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* Implement continuous improvement processes
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b. The Board of Directors, through its committees, shall establish and oversee:
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* Performance metrics and reporting requirements
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* Service level frameworks
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* Cost allocation methodologies
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* Technology and service strategies
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* Vendor selection criteria
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* Quality control measures
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* Other operational parameters as needed
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* Performance metrics and reporting requirements
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* Service level frameworks
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* Cost allocation methodologies
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* Technology and service strategies
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* Vendor selection criteria
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* Quality control measures
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* Dispute resolution procedures for service conflicts
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* Other operational parameters as needed
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### 4. Vendor Relationships
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a. Service divisions shall have sole authority to:
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* Select external vendors
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* Negotiate vendor contracts
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* Manage vendor relationships
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* Terminate vendor relationships
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b. All vendor relationships shall be:
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* Subject to Board oversight
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* Managed according to Board-established criteria
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* Properly documented
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* Regularly reviewed
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### 5. Cost Allocation
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a. Service costs shall be:
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* Allocated among series according to Board-approved methodologies
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* Documented transparently
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* Reviewed regularly
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* Adjusted as needed to maintain cost-only operation
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### 6. Documentation Requirements
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All service division operations shall be documented in accordance with the electronic records requirements of Section 3.2.
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### Section 3.2 - Electronic Records Requirement
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@@ -1040,6 +1039,51 @@ The Company may maintain only those assets necessary for series administration,
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- Structured appeal and review mechanism
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- Preservation of organizational integrity
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### Section 7.2.1 - Integration of Corporate and Sociocratic Governance
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1. **Spheres of Authority**:
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a. **Board and Committees**: Have primary authority over:
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* Strategic direction
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* Capital allocation decisions
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* Major structural changes
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* Compliance oversight
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* Risk management
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* Financial performance
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b. **Sociocratic Circles**: Have primary authority over:
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* Operational decisions within policy boundaries
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* Implementation of strategic initiatives
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* Day-to-day management
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* Operational process design
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* Team composition and roles
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* Service delivery methods
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2. **Decision-Making Framework**:
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a. **Strategic Decisions**: Made by the Board and Committees using traditional governance processes.
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b. **Operational Decisions**: Made by circles using sociocratic consent-based processes.
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c. **Mixed Decisions**: For decisions falling between strategic and operational domains:
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* Initial proposal originates from the appropriate circle
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* The proposal is refined through double-linking communication
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* Final approval follows the consent process in both systems
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3. **Conflict Resolution Process**:
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a. **Level 1**: Conflicts are first addressed through the double-linked representatives.
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b. **Level 2**: Unresolved conflicts are escalated to a joint meeting of circle leaders and committee representatives.
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c. **Level 3**: If still unresolved, the Compliance and Ethics Committee shall serve as the final arbiter.
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4. **Review Mechanism**:
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a. The Compliance and Ethics Committee shall conduct an annual review of the governance integration effectiveness.
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b. Recommendations for governance improvements shall be presented to both the Board and General Circle annually.
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### Section 7.3 - Company Committee
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1. Composition:
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