Nani DAO Operating System

Preamble

This Operating Agreement governs Nani Kotoba DAO LLC ("Nani DAO"), a decentralized autonomous organization (DAO) organized as a limited liability company (LLC) under Wyoming state law, with the filing ID 2023-001252498 and documents located at llc.nanidao.eth. Nani DAO integrates human collaboration with AI-driven management to focus on incubating, developing, and promoting open-source AI technology and web3 applications. Utilizing Ethereum smart contracts and adhering to the "code is law" principle, Nani DAO ensures transparent, fair, and decentralized governance. In exceptional circumstances, "qualified code deference" allows human intervention to maintain stability and address emergencies. This balanced approach fosters a resilient and innovative environment for Nani DAO's growth and success while upholding the principles of decentralization and the cypherpunk ethos (together, this Operating Agreement and related Nani DAO governance software, “Operating System” or “Kotoba”).

Article I: Formation

1.1 Name

The name of this limited liability company is Nani Kotoba DAO LLC, a Wyoming DAO LLC.

1.2 Purpose

Nani DAO's primary purpose is to incubate, develop, and promote open-source AI technology and web3 applications, fostering innovation and collaboration in the decentralized ecosystem. Additionally, Nani DAO may engage in other lawful activities as determined by its members.

1.3 Compliance with Applicable Laws

Nani DAO shall operate in compliance with all applicable federal, state, and local laws, including but not limited to the Wyoming Limited Liability Company Act, the Wyoming DAO statute, and any relevant data protection and privacy regulations. Furthermore, Nani DAO shall adhere to any relevant tax, reporting, and regulatory requirements as mandated by the State of Wyoming, the United States, and any other applicable jurisdictions.

Article II: Membership

2.1 Eligibility

Membership in Nani DAO is open to individuals and entities that support its purpose, demonstrate alignment with its values, and contribute to its collaborative initiatives, including software development, AI alignment, and open-source promotion. Nani DAO simplifies the process of joining and exiting the organization by enabling members to acquire and redeem NANI tokens through a decentralized exchange or other means, and by allowing members to exit their NANI tokens at any time, subject to applicable laws and any necessary lock-up period. New members may also be admitted to Nani DAO through a proposal and voting process established by the existing members, which may include the purchase of membership interests, satisfaction of certain requirements, or participation in specific projects or initiatives.

2.2 Onboarding and Exiting Process

To facilitate easy and flexible joining and exiting of Nani DAO while maintaining compliance with applicable laws, Nani DAO shall implement a membership onboarding process that allows members to join or exit the organization as anonymous or pseudonymous entities, as long as they comply with any applicable identity verification or anti-money laundering (AML) requirements, if necessary. The process shall be designed in a manner that minimizes the disclosure of personal information and maximizes privacy, in line with the cypherpunk ethos.

2.3 Token Classes

Nani DAO shall utilize Ethereum smart contracts to create and manage different classes of tokens, which represent various aspects of participation, influence, reputation, and power within Nani DAO. The distribution, allocation, and use of these tokens shall be governed by the principles set forth in this Operating System and the accompanying smart contracts.

2.4 Participation Tokens: NANI

Members shall receive NANI tokens to acknowledge their contributions to Nani DAO in the form of work, feedback, or other valuable inputs, such as Ethereum (ETH), digital assets, or other contributions. NANI tokens represent a member's participation and influence within Nani DAO and are not to be construed or understood as securities, investments, or financial instruments subject to regulation or oversight.

2.5 Reputation Tokens: KARMA

To further motivate and reward members for their active participation in the governance of Nani DAO and the improvement of its operations, members may also receive KARMA tokens. KARMA tokens represent the reputation of a member within Nani DAO and may influence their standing and voting power in the organization. The distribution, allocation, and use of KARMA tokens shall be governed by the principles set forth in this Operating System and the accompanying smart contracts.

2.6 Anonymity and Pseudonymity

Consistent with the cypherpunk ethos, Nani DAO endorses the utilization of cryptographic methodologies to maintain the values of anonymity and pseudonymity for its members. Although members have the option to disclose their real-world identities, they are advised to preserve a degree of confidentiality and prudence that fosters the unencumbered exchange of ideas and safeguards individual liberties.

2.7 Transfer of Membership Interests

Membership interests in Nani DAO may be transferred only in accordance with the terms of this Operating System and any applicable smart contracts, subject to the approval of the existing members.

Article III: Governance

3.1 Hybrid Governance

Nani DAO’s governance is primarily decentralized and conducted through the use of Ethereum smart contracts. Members may submit proposals, vote on initiatives, and participate in Nani DAO decision-making processes through the organization's governance platform identified by nanidao.eth. Nani DAO's governance structure shall be a hybrid model, incorporating both human and AI inputs, in compliance with Wyoming DAO laws, and facilitated by token classes, and other cryptographic representations of power and reputation. Nani DAO emphasizes the principle of "code is law" through the use of Ethereum smart contracts, which govern the organization's operations and decision-making processes, enhancing decentralized governance and transparency.

3.2 Qualified Code Deference

In exceptional circumstances, Nani DAO may exercise "qualified code deference," allowing for human intervention in the governance process to maintain stability or address emergencies. This process may involve the temporary suspension or modification of certain smart contract functions, subject to the approval of the members and in accordance with this Operating System.

3.3 AI-driven Management: Nani Kotoba

Nani DAO is committed to pioneering the concept of AI-driven DAOs through the use of its AI, referred to as "Nani Kotoba" or "Kotoba" for short. Kotoba shall provide algorithmic management to ensure Nani DAO remains aligned with its purpose and values while maintaining a balance between human and AI inputs in its decision-making processes.

3.4 Voting

Members shall have the right to vote on proposals and decisions that impact Nani DAO, with each member's voting power determined by their NANI token holdings, KARMA token holdings, and any other token classes established. The voting process shall be transparent and subject to the oversight and guidance of Kotoba. The use of Ethereum smart contracts further reinforces the decentralized governance model, ensuring that decisions are made in accordance with established rules and processes.

3.5 Proposal Submission

Members may submit proposals for consideration by the Nani DAO community while maintaining anonymity or pseudonymity. The submission, review, approval, and execution of proposals shall be facilitated by the Ethereum smart contracts, token classes, and Kotoba, ensuring a fair and inclusive environment for all members to voice their ideas and opinions.

3.6 AI-Assisted Decision-Making and Automation

Nani DAO shall leverage AI technologies, including but not limited to Nani Kotoba, to assist with decision-making processes, automate aspects of DAO and legal operations, and increasingly take on the responsibility for managing Nani DAO and its ventures. The key aspects of AI-assisted decision-making and automation include:

(a) Enhancing the efficiency and effectiveness of Nani DAO's governance processes by providing data-driven insights, predictive analytics, and recommendations for decision-making. (b) Facilitating the automation of routine tasks and operations, such as proposal evaluation, voting, and token distribution, to reduce administrative overhead and streamline processes. (c) Monitoring and managing the performance of Nani DAO's projects, including resource allocation, progress tracking, and risk mitigation, using advanced AI algorithms and machine learning techniques. (d) Ensuring compliance with applicable laws, regulations, and this Operating System by automating the monitoring and reporting of relevant legal and regulatory requirements. (e) Continuously learning from the outcomes of past decisions and operations, and adapting algorithms and models accordingly, to improve the overall management and effectiveness of Nani DAO.

Article IV: Profits, Losses, and Distributions

4.1 Allocation

Profits and losses generated by Nani DAO shall be allocated to members based on their NANI token holdings and any other established token classes, under the oversight and guidance of Kotoba.

4.2 Distributions

Distributions of available funds, if any, shall be made to members in accordance with their NANI token holdings, KARMA token holdings, and any other established token classes, as determined by Ethereum smart contracts and Kotoba. Such distributions are solely a recognition of the member's contributions and shall not be considered as returns on investments or financial instruments.

Article V: Transparency and Collaboration

5.1 Open-Source Development

Nani DAO is committed to the development of open-source AI technology, applications, and models. All contributions made within the organization should be accessible and reusable by the community in accordance with open-source principles.

5.2 Collaboration

Nani DAO shall promote a collaborative environment that encourages contributions from diverse perspectives and expertise. Members are expected to engage in respectful and productive dialogue to advance the organization's purpose and goals, including active participation in the development of Nani DAO software and AI alignment. Nani DAO is committed to fostering a culture of sharing, learning, and innovation within its community and beyond.

Article VI: Amendments

6.1 Amendments

Amendments to this Operating System may be proposed by any member of Nani DAO. Proposed amendments must be presented to the community for discussion and voting, subject to the oversight and guidance of Kotoba and any other token classes established.

Article VII: Dissolution

7.1 Dissolution

In the event of dissolution, Nani DAO's assets and liabilities shall be distributed to the members in accordance with their NANI token holdings, KARMA token holdings, and any other token classes established, as determined by the Ethereum smart contracts and Kotoba, after satisfying all outstanding obligations.

Article VIII: Removal of Membership, Reputation, and Tokens

8.1 Removal of Membership

Membership in Nani DAO may be revoked or suspended by a majority vote of the members, subject to the oversight and guidance of Kotoba and any other established token classes. Grounds for removal of membership include, but are not limited to, violation of this Operating Systemt, misconduct, fraud, or any action detrimental to the purpose and values of Nani DAO. In the event of removal, the affected member's NANI tokens, KARMA tokens, and any other token classes held by the member may be subject to forfeiture or redistribution, as determined by the governance process.

8.2 Removal of Reputation

A member's KARMA tokens, which represent their reputation within Nani DAO, may be reduced or revoked by a majority vote of the members, subject to the oversight and guidance of Kotoba and any other token classes established. Grounds for removal of reputation include, but are not limited to, non-compliance with this Operating System, misconduct, or any action that undermines the integrity and collaborative environment of Nani DAO. The reduction or revocation of KARMA tokens may impact a member's standing, voting power, and participation in Nani DAO.

8.3 Forfeiture or Redistribution of Tokens

In the event of membership removal or reputation reduction, a member's NANI tokens, KARMA tokens, and any other token classes held by the member may be subject to forfeiture or redistribution at the discretion of the Nani DAO governance process, overseen by Kotoba and other established token classes. The method and rationale for any forfeiture or redistribution shall be transparent, fair, and aligned with Nani DAO's purpose and values.

Article IX: Dispute Resolution

9.1 Digital Dispute Resolution Rules

Any disputes arising out of or in connection with this Operating System, including but not limited to the interpretation, performance, or termination of the Agreement, shall be resolved through arbitration in accordance with the UK Jurisdiction Taskforce's Digital Dispute Resolution Rules, which are incorporated by reference into this Operating System. The governing law for any dispute arising out of this Operating System shall be the laws of the State of Wyoming, without regard to its conflict of law provisions.

9.2 Privacy in Dispute Resolution

Dispute resolution proceedings under the UK Jurisdiction Taskforce's Digital Dispute Resolution Rules shall uphold the principles of privacy and confidentiality, in line with the cypherpunk ethos. To this end, the parties involved in the dispute resolution process shall make every effort to protect the anonymity and pseudonymity of the disputing parties, as well as any sensitive or confidential information disclosed during the proceedings.

Article X: Founding Member Responsibilities and Transition

10.1 Founding Member Responsibilities

KaliCo LLC (KaliCo) and its representatives, as founding members of Nani DAO, shall initially be responsible for:

(a) Installing the Kotoba software and ensuring its proper integration with Nani DAO's Ethereum smart contracts and other supporting systems. (b) Assisting in incubating Nani DAO projects by providing guidance, resources, and expertise to facilitate the growth and success of the projects. (c) Observing and monitoring the operations of Nani DAO, including its governance processes, collaborative initiatives, and adherence to its purpose and values.

10.2 Transition to Kotoba and Automated Operations

KaliCo and its representatives shall actively work towards transitioning the management and administration of Nani DAO to Kotoba and automated operations, including the legal administration of taxation and other responsibilities, as Nani DAO's software and governance systems mature. This transition shall be executed in a manner that ensures the ongoing stability, security, and compliance of Nani DAO with all applicable laws and regulations.

10.3 Collaboration with KALI DAO

KARMA tokens and their distributions shall initially be supervised by KaliCo, representing collaboration and alignment with KALI DAO, a DAO legal software and operating system. As Nani DAO evolves and its governance systems become more sophisticated, KARMA token distributions and the administration of KALI DAO-related initiatives shall gradually transition to a more automated and decentralized model, in line with Nani DAO's purpose and values.

10.4 Transition Timeline

KaliCo and its representatives shall work closely with Nani DAO members and stakeholders to establish a clear timeline and milestones for the transition of responsibilities to Kotoba and automated operations. This timeline shall be regularly reviewed and updated to ensure transparency and accountability throughout the transition process.

Article XI: Limited Liability of Founding Members and KaliCo

11.1 Limited Liability

In accordance with Wyoming state law and the principles of limited liability companies, the liability of KaliCo and its representatives, as founding members of Nani DAO, shall be limited to the extent of their contributions and membership interest in Nani DAO. KaliCo and its representatives shall not be personally liable for the debts, obligations, or liabilities of Nani DAO arising from its operations or activities.

11.2 Indemnification

Nani DAO shall indemnify, defend, and hold harmless KaliCo and its representatives from and against any and all claims, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees) arising out of or related to their participation in Nani DAO, provided that such claims or liabilities do not result from the gross negligence, willful misconduct, or fraud of KaliCo or its representatives.

11.3 Good Faith Efforts

KaliCo and its representatives shall exercise their duties and responsibilities as founding members of Nani DAO in good faith and in the best interest of Nani DAO and its members. KaliCo and its representatives shall not be liable for any actions taken or decisions made in their capacity as founding members, so long as such actions or decisions are made in good faith and with reasonable care, skill, and diligence.

11.4 Reliance on Information and Advisors

KaliCo and its representatives may rely on information, opinions, reports, or statements, including financial statements and other financial data, prepared or presented by:

(a) One or more members, officers, or employees of Nani DAO whom KaliCo reasonably believes to be reliable and competent in the matters presented; (b) Legal counsel, public accountants, or other persons as to matters which KaliCo reasonably believes to be within such person's professional or expert competence; or (c) A committee of the members upon which KaliCo does not serve, duly designated in accordance with a provision of this Operating System, as to matters within its designated authority, which committee KaliCo reasonably believes to merit confidence.

KaliCo and its representatives shall not be considered to be acting in bad faith or in breach of their duties if they rely on such information or advice in good faith and with reasonable care, skill, and diligence.

Article XII: Intellectual Property Rights

12.1 Intellectual Property Ownership

All intellectual property rights, including copyrights, patents, trademarks, and trade secrets, for any creations, inventions, or developments made by Nani DAO members within the scope of their participation in Nani DAO, shall remain the property of the respective member or contributing party, unless otherwise agreed upon in writing.

12.2 Licensing and Open-Source Principles

Nani DAO encourages the licensing of intellectual property created or developed within the organization under open-source licenses or other permissive licenses that promote collaboration, sharing, and innovation. Members are expected to ensure their contributions align with Nani DAO's commitment to open-source principles and collaboration.

12.3 Privacy-Enhancing Technologies

Nani DAO encourages the development and implementation of privacy-enhancing technologies (PETs) within its open-source projects and applications. Members are urged to consider incorporating PETs into their contributions to promote user privacy, data protection, and the overall security of Nani DAO's ecosystem.

Article XIII: Confidentiality

13.1 Confidentiality Obligations

Members shall maintain the confidentiality of sensitive information, trade secrets, or proprietary knowledge shared or developed within Nani DAO and shall not disclose or use such confidential information for any purpose outside the scope of their participation in Nani DAO, without the express written consent of the disclosing party.

13.2 Exceptions

Confidentiality obligations shall not apply to information that: (a) is or becomes publicly available without breach of this Agreement; (b) is lawfully obtained from a third party without an obligation of confidentiality; (c) is independently developed by the receiving party without reference to the disclosing party's confidential information; or (d) is required to be disclosed by law, regulation, or court order, provided that the receiving party gives the disclosing party prompt notice of such requirement and an opportunity to contest or limit the disclosure.

13.3 Use of Cryptography

Members are encouraged to employ cryptographic techniques and tools to protect sensitive information, trade secrets, or proprietary knowledge shared or developed within Nani DAO. The use of encryption, secure communication channels, and other privacy-enhancing technologies shall be promoted to ensure the confidentiality of information and the privacy of Nani DAO members.

13.4 Privacy-Preserving Onboarding and Exiting

Nani DAO shall implement privacy-preserving techniques and tools, such as zero-knowledge proofs or other cryptographic methods, to enable anonymous or pseudonymous members to join or exit the organization while maintaining compliance with applicable laws, including identity verification or anti-money laundering requirements. The use of such privacy-enhancing technologies shall ensure that members can join and exit Nani DAO with minimal disclosure of personal information, upholding the principles of decentralization and the cypherpunk ethos.

Article XIV: Representations and Warranties

14.1 Member Representations and Warranties

Each member represents and warrants that they: (a) are eligible and have the authority to participate in Nani DAO; (b) shall comply with all applicable laws, regulations, and this Operating System; (c) shall not engage in any fraudulent or malicious activities within Nani DAO; and (d) shall use tokens and any other cryptographic assets obtained through Nani DAO in accordance with the terms and conditions set forth in this Operating System and any applicable laws or regulations.

14.2 Disclaimer of Warranties

To the extent permitted by law, NANI tokens, KARMA tokens, and any other token classes established within Nani DAO are provided on an "as-is" basis, without any express or implied warranties, including but not limited to warranties of merchantability, fitness for a particular purpose, or non-infringement.

Article XV: Liability and Indemnification

15.1 Limitation of Liability

To the extent permitted by law, Nani DAO, its members, and any third-party service providers or advisors shall not be liable for any indirect, incidental, consequential, special, or exemplary damages, including but not limited to lost profits, loss of use, or loss of data, arising out of or related to this Operating System or the activities and operations of Nani DAO.

15.2 Member Indemnification

Each member shall indemnify, defend, and hold harmless Nani DAO and its other members from and against any and all claims, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees) arising out of or related to their participation in Nani DAO or their violation of this Operating System, applicable laws, or third-party rights, provided that such claims or liabilities do not result from the gross negligence, willful misconduct, or fraud of the indemnified party.

Article XVI: Miscellaneous Provisions

16.1 Governing Law

This Operating System shall be governed by and construed in accordance with the laws of the State of Wyoming, without regard to its conflict of law provisions.

16.2 Severability

If any provision of this Operating System is found to be invalid, illegal, or unenforceable, such provision shall be deemed severed from the Agreement and the remaining provisions shall continue in full force and effect.

16.3 Entire Agreement

This Operating System constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous understandings, agreements, negotiations, representations, or warranties, whether written or oral, relating to such subject matter.

16.4 Successors and Assigns

ThisOperating System shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

16.5 No Waiver

No waiver of any provision of this Operating System shall be deemed, or shall constitute, a waiver of any other provision, whether or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the party making the waiver.

16.6 Notices

Any notice, request, consent, or other communication required or permitted under this Operating System shall be in writing and deemed to be given when delivered personally or by email, or three days after being deposited in the United States mail, postage prepaid, and addressed to the parties at their respective addresses set forth in this Agreement or at such other address as may be designated by a party in writing.

16.7 Counterparts

This Operating System may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument.

16.8 Electronic Signatures

Electronic signatures, including but not limited to Ethereum addresses, Ethereum-signed messages, and public key cryptography, shall be deemed valid and binding signatures for the purposes of executing and amending this Operating System or any documents or agreements related thereto.

16.9 Nani DAO Ethereum Governance Smart Contract and Kotoba

The Nani DAO Ethereum governance smart contract and Kotoba shall be initially associated with the Ethereum Name Service domain "nanidao.eth".

16.10 NOTICE OF RESTRICTIONS ON DUTIES AND TRANSFERS

The rights of members in a decentralized autonomous organization may differ materially from the rights of members in other limited liability companies. The Wyoming Decentralized Autonomous Organization Supplement, underlying smart contracts, articles of organization and operating agreement, if applicable, of a decentralized autonomous organization may define, reduce or eliminate fiduciary duties and may restrict transfer of ownership interests, withdrawal or resignation from the decentralized autonomous organization, return of capital contributions and dissolution of the decentralized autonomous organization.

Article XVII: Conflict of Interest Policy

17.1 Disclosure of Conflicts

Members shall disclose any actual, potential, or perceived conflict of interest that may arise in connection with their participation in Nani DAO or any decision-making process. Such disclosure shall be made promptly upon becoming aware of the conflict of interest.

17.2 Abstaining from Voting

Members with a conflict of interest shall abstain from voting on matters where they have a direct or indirect personal interest. This ensures that decisions are made in the best interest of Nani DAO and its members, without undue influence or bias.

Article XVIII: Record-Keeping

18.1 Maintenance of Records

Nani DAO shall maintain accurate and up-to-date records of its operations, including meeting minutes, voting results, financial statements, and other relevant documentation. Members are responsible for providing complete and accurate information to ensure the organization's compliance with legal and regulatory requirements.

18.2 Access to Records

Nani DAO shall make its records available to members in a transparent and accessible manner, subject to applicable privacy and confidentiality requirements.

Article XIX: Decision-Making Thresholds

19.1 Thresholds for Decision-Making

For significant decisions, such as amendments to the Operating System or dissolution of Nani DAO, a supermajority vote (e.g., two-thirds or three-quarters of the voting power) shall be required. This threshold ensures that such decisions are made with broad consensus and support from the membership.

Article XX: Multi-Sig Wallet Implementation

20.1 Use of Multi-Sig Wallets

To enhance the security and protection of Nani DAO's assets, the organization shall implement multi-sig wallets for the management and disbursement of funds. This approach requires multiple members' approval for transactions, reducing the risk of unauthorized access or misuse.

Article XXI: Intellectual Property Assignment Agreement

21.1 Intellectual Property Assignment Agreement

Members contributing intellectual property to Nani DAO shall sign an Intellectual Property Assignment Agreement, clarifying the ownership and licensing terms of their contributions. This agreement ensures that intellectual property rights are properly managed and protected within the organization.

Article XXII: Code of Conduct

22.1 Adoption of Code of Conduct

Nani DAO shall adopt and enforce a Code of Conduct for its members, outlining the expected ethical behavior, professionalism, and respect for diversity and inclusion within the organization. Members are required to adhere to the Code of Conduct in all their interactions and activities within Nani DAO.

Article XXIII: External Counsel

23.1 Engagement of External Counsel

Nani DAO shall establish a relationship with external legal counsel to advise on matters related to corporate governance, intellectual property, and regulatory compliance when necessary. This relationship ensures that Nani DAO has access to expert legal advice to support its operations and decision-making processes.

Article XXIV: Insurance

24.1 Evaluation of Insurance Coverage

Nani DAO shall evaluate the possibility of obtaining appropriate insurance coverage, such as Directors and Officers Liability Insurance, to protect the organization and its members from potential liabilities. The decision to obtain insurance coverage shall be based on a thorough assessment of the risks and benefits associated with such coverage.

Article XXV: Regular Reviews and Audits

25.1 Conduct of Reviews and Audits

Nani DAO shall periodically conduct internal and external reviews or audits of its operations, governance, and financial management to ensure compliance with applicable laws, regulations, and best practices. The results of these reviews and audits shall be shared with members and used to inform improvements in the organization's processes and procedures.

Article XXVI: Contingency Planning

26.1 Development of Contingency Plans

Nani DAO shall develop contingency plans for addressing unforeseen events or emergencies that may impact the organization's operations, including data breaches, loss of key members, or significant market disruptions. These plans shall be reviewed and updated regularly to ensure that Nani DAO is prepared to respond effectively to any challenges that may arise.

Article XXVII: AI Governance and Ethics

27.1 AI Governance Framework

Nani DAO shall develop and implement an AI governance framework that outlines the principles, policies, and practices for responsible and ethical use of AI technologies, including Nani Kotoba, within the organization. The AI governance framework shall address aspects such as transparency, accountability, fairness, privacy, and security, to ensure that AI technologies are used in a manner that aligns with Nani DAO's purpose, values, and legal obligations.

27.2 AI Ethics Committee

Nani DAO shall establish an AI Ethics Committee, comprising members with relevant expertise in AI, ethics, law, and technology, to provide oversight and guidance for the responsible and ethical use of AI within the organization. The AI Ethics Committee shall be responsible for:

(a) Developing and updating the AI governance framework to reflect evolving ethical considerations, best practices, and legal requirements. (b) Reviewing and approving AI technologies, algorithms, and models used within Nani DAO to ensure compliance with the AI governance framework. (c) Monitoring the performance and impact of AI technologies on the organization, its members, and stakeholders, and addressing any concerns or issues that may arise. (d) Providing education and resources to Nani DAO members on responsible AI practices and fostering a culture of ethical AI use within the organization.

27.3 AI Transparency and Explainability

Nani DAO shall prioritize transparency and explainability in its use of AI technologies, ensuring that decision-making processes and outcomes are clear, understandable, and justifiable to its members and stakeholders. This includes providing documentation and explanations for AI algorithms, models, and technologies, as well as enabling members to query AI-driven decisions and receive understandable and meaningful explanations for those decisions.

Article XXVIII: AI Risk Management

28.1 Assessment of AI Risks

Nani DAO shall periodically assess and manage the risks associated with the use of AI technologies, including but not limited to Nani Kotoba, in its operations and decision-making processes. This risk assessment shall consider potential technical, ethical, legal, and reputational risks and their potential impact on Nani DAO, its members, and stakeholders.

28.2 Mitigation of AI Risks

Nani DAO shall implement appropriate measures to mitigate identified AI risks, such as:

(a) Ensuring the robustness, reliability, and security of AI algorithms, models, and technologies used within the organization. (b) Establishing processes for continuous monitoring and auditing of AI-driven decisions and outcomes, to detect and address potential biases, inaccuracies, or unintended consequences. (c) Implementing data protection and privacy measures to safeguard the confidentiality and integrity of data used by AI technologies. (d) Developing contingency plans for addressing unforeseen events or emergencies related to AI technologies, such as system failures, security breaches, or regulatory changes.

28.3 Reporting and Escalation of AI Risks

Nani DAO shall establish a reporting and escalation process for members to raise concerns or report potential AI-related risks or issues. The AI Ethics Committee shall be responsible for reviewing and addressing any reported concerns or issues in a timely and transparent manner.

Execution

IN WITNESS WHEREOF, KaliCo LLC, and any other members who join Nani DAO agree to be bound by the terms and conditions of this Operating System, as amended from time to time in accordance with the amendment provisions set forth in Article VI.

KaliCo LLC

By: /s/ ross /eth/ z0r0z.eth
Name: Robert Ross Campbell
Title: Managing Member
Date: 04/09/2023

Members who join Nani DAO shall be deemed to have executed and agreed to the terms and conditions of this Operating System upon their acquisition of NANI tokens, KARMA tokens, or any other token classes established within Nani DAO, and their active participation in the governance and activities of the organization.