Ondo's Board Has Zero Directors. Who's in Charge? - DEX in the City

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As many people know, Nathan Olman was the founder and CEO of Ono. Um, and Ono tokenizes traditional real world assets. Um, I believe they were one of the first to tokenized treasuries and brings them onto public chains. They've they've been doing really well. They're a Tradfi darling. Uh, and it's obviously a fast growing, thriving company. And you know, Nathan passed away tragically earlier this summer at the age of 32 years old. Awful. So he was the CEO, the sole sitting director and the controlling shareholder of Ando. And so his voting shares passed into his estate. And after

this happened, um Ian Debbode, which was Ando's president, was announced as CEO. So, it was clear that Ando tried to shepherd a smooth transition. It It's It's not clear whether Nathan's death was unexpected or not, but no matter the circumstances, it was like, "Okay, now the president's CEO. We're moving right along." But Nathan's mother, Kathleen, was the personal representative of his estate. So, you know, when someone dies, it goes into a probate process. It can be very complicated. It can take a long time to resolve their estate depending on how well the estate is set up. You know whe whether there was a will, whether there were trusts and also largely dependent on state law and like

many other companies, the majority of companies, crypto or not, was headquartered in Delaware. So this was kind of winding its way through the Delaware process. And so Almond's mother then sued asserting control of Andondo. And in some basically because Nathan was the sole director, his death left the board with zero directors. And Kathleen has alleged that Ando's bylaws allegedly required the board to appoint the CEO. Um, so she has said that while Nathan's shares were tied up in this probate process, Debode asserted that he had automatically become CEO and he used a voting agreement to make himself sole

director. Those are all her allegations. Nothing has been proven. I know nothing about the actual facts or what occurred. But because Alman's mother, um, Kathleen was the personal representative, she has or she's alleging she has the ability to exercise the estate's voting rights. So she appointed herself to Ando's board and she first kept Ian Debbot as president. Then she put an interim operating policy in place and sought out corporate records. And in the lawsuit, she's alleged that Ando's council and Ian Debode wouldn't give her the records or recognize her board seat. So she then added Nathan's sister to the board and that board voted to fire Ian Debode entirely and install Kathleen, Nathan's mother, as interim CEO. and she has

said, "I don't intend on running permanently, but temporarily while the board finds a new CEO." Ian Debode, on the other hand, doesn't recognize any of this. And he says that Ando's investors and the Onondo Foundation supports his leadership. Very, very, very messy. I mean, like very dramatic. >> Obviously, a crypto story, but like how could you only have one board member and call it a board? And it's not unheard of. Oh, >> but at the How long has Ando been around?

>> It's not unheard of at all. And in the grand scheme of crypto companies, Ando is not a new company. Um, I know I I remember Ando being a Maple competitor back in 2022 when I was at Maple. Uh, but you make a great point, Jesse. Like, this is not a crypto thing. This is actually a Delaware law thing, an estate planning thing, a succession planning thing. But when I read about this story, I thought we need to talk about this because crypto companies grow very quickly and corporate governance, which is the whole like who's doing what, is there a board, what is the structure of the board, etc. It's not always a focal point. And further, when you have a young founder and or CEO, estate

planning isn't always on the top of their list. But you have to think about these things. you you always have to think about the hit by a bus scenario to ensure that the organization is long-term sustainable because if you don't you you could have this situation. >> I mean we were talking before about how a lot of tribey institutions and entities respect and like its products and you know that might be true but like did no one do diligence on this? Like before you build with a product, don't you want to know what the board composition is? Like to are we all just moving too fast? But it's not fast. Like they've been around a while. So this

isn't the first time something like this happened. I'm just shocked that it's with a company that has so much money poured into it. And maybe that's just my idealism about the world. Well, it's also and you rais a good point, Jesse, because the other thing to think about is look, no one is requiring a board in a lot of structures. Now, certain legal structures or jurisdictions require a board. Others do not. So, there are companies that don't have a corporate governance structure, and sometimes there's very good reasons for that. Like, nobody needs a board of five people. So, maybe they made a specific choice that's justifiable. However, if they did that, then obviously there needed to be an appropriately documented

succession plan in place if there was a death or some sort of takeover or some sort of extenduating circumstance. That is, I think, the lesson to take away from this. Obviously, look at your structure and make sure it makes sense from a kind of a mechanical day-to-day legal fulfillment perspective. Like, if you're required to have a board, have it. If you are, if you need a board, what do you want from your board? You know, sometimes boards want uh kind of supporters. Sometimes boards want strategic adviserss or or insight that different boards exist for different reasons. But first and foremost, you need to look at your leadership and say, "Tomorrow, if so and so is hit by a bus, do we have a clear succession plan? Do

we have have we thought through all of the scenarios like estate planning if they pass away or control of various entities? And my fear is in crypto when you have a 32year-old CEO or founder that maybe is >> old in crypto as a 40year-old. You're saying >> well this is why lawyers are like were never invited to the party. Like that is definitely something I would do as a GC. >> To go to late parties anymore. something I've done at every company I've been like what are we doing in terms of succession planning and like nobody wants to talk about that stuff but it's important okay >> so what's going to happen here like is like what's going to happen to does it

matter to the token price does it matter to their contracts like are we rooting for the mom like I don't know >> it's a great question Jesse because look like right now you have two competing chains of authority you know Debo's version and Kathleen's slashthe estates version. Now, arguably the company's sustainable under either scenario, but now given this litigation, it's hard to envision a scenario where if Kathleen wins, Ian Debode stays as CEO. So then there's the question of actual succession. Who's going to be president?

Who's going to be CEO? That degree of volatility, that leadership, that vision is in question. So, of course, there's likely going to be collateral damage to the question of strategic partnerships or ongoing operations. That's just a a spectre whenever you're dealing with a company where there's any degree of, you know, volatility or question mark with the senior team. I don't know how they're going to kind of move forward from here, but it's still a thriving company with a interesting value proposition. So, if the estate wins, I I would anticipate that like Kathleen and others would do a very comprehensive CEO sweep and find someone

well suited to this role. However, who knows because how can you replace institutional knowledge like Ian Devote? I'm certainly not taking sides, but I feel like I'm watching a movie and not in a good way like a sad dramatic movie. >> Yeah. >> Yeah. I you know what it made me think of like as someone who works at a a DeFi company like we think about quote unquote succession planning a lot in the context of things like multi-IGS and dependencies on like people who hold the keys um you know like emergency councils and like what happens if there's a governance attack and a protocol. I mean, literally like if if we had a team off-site, we would have to do all of this coordination around like

how many of the signers are going to be at the same, you know, on on the same flight or whatever it is, right? So, like I think in crypto, this sort of thing really does take on like special and unique importance. And so if you're a company and you're holding like really important pieces of tokenized financial infrastructure, like you really do need to think carefully about not just all of that like operational and security stuff, but all of the boring sort of corporate governance stuff that is like maybe too morbid and so people, you know, don't always think about it or want to talk about it. But when you have a situation like this, you're like, "Oh, well, that's why it makes sense to have multiple directors on a board or like clear vacancy provisions and succession

plans um and an unambiguous like process and authority like if a founder or a CEO dies or something." That was a clip from Decks in the City where the wallets are cold and the takes are hot. And we've got a lot more in the full episode. Links in the show notes. I'm host KK. Subscribe and join us on the live stream every Tuesday at noon Eastern. $540 million. That's how much concentrated liquidity sat idle in a given week in the first half of this year. About 30% of the DeFi TVL if you're wondering. That's according to Dune Research commissioned by 1 in. But there's a solution. 1-in Aqua is the new shared liquidity platform. It lets LPS

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