note

Current public-DAV authority boundary — 2026-07-12. Pre-launch target design; nothing here proves a live system. A public-DAV consequence may occur only when at least two natural-person councilors bind the exact consequence in a complete valid bound PRISM decision receipt. PRISM records and verifies that receipt only; it never serves as council, signatory, authority, or receipt producer. AI and caste seats stage unsigned proposals only; they never authorize or execute a public-DAV consequence. Constitution or membership adoption establishes constitution and membership only; it does not authorize a later consequence. Policy may constrain an unsigned proposal but never authorizes execution or substitutes for the complete consequence-bound receipt. Before receipt validity, consequence fails closed to read-only proposal, simulation, or deterministic sandbox; live evidence remains gated_pending_complete_valid_bound_receipt. Software deterministically carries out only the exact consequence bound to a complete valid bound PRISM decision receipt from at least two natural-person councilors binding that exact consequence.

K4: Grace Exit

Target design: Any LP-100 holder would be able to leave at any time, for any reason, receiving their proportional share of Net Asset Value. No lock-up. No penalty. No governance approval. No waiting period. Full data export. The organism retains nothing (frozen claim until reconciliation complete).

This is Gate C. It is the most important invariant in the protocol.

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Mechanism

1. Holder calls Grace Exit on the DAV's settlement contract.
2. NAV would be calculated on-chain from the DAV's treasury, receivables, and marked-to-market positions (frozen claim until reconciliation complete).
3. Share is computed: payout = (holder_balance / 100) * NAV.
4. SKY would be transferred to the exiting holder's wallet (frozen claim until reconciliation complete).
5. LP-100 would be returned to the DAV (redistributed to remaining holders proportionally) (frozen claim until reconciliation complete).
6. Data would be exported: All receipts, transaction history, governance votes, and personal data associated with the exiting holder would be packaged and delivered (frozen claim until reconciliation complete).
7. Grants would be revoked: Any permissions, access rights, or delegations the holder had granted to the organism would be revoked (frozen claim until reconciliation complete).

Target design: the entire process would be atomic. It would complete in a single transaction or revert entirely (frozen claim until reconciliation complete).

What "The Organism Retains Nothing" Means

After Grace Exit:

• The organism holds none of the exiting holder's data.
• The organism holds none of the exiting holder's LP-100 (it is redistributed to remaining holders proportionally per the DAV's constitution).
• The organism has no ongoing claim on the exiting holder.
• The exiting holder has no ongoing obligation to the organism.

The relationship is cleanly severed. There is no residual entanglement.

No Lock-Up

Target design: there would be no vesting period, no "staking cooldown" that delays exit, and no governance vote that can suspend Grace Exit (frozen claim until reconciliation complete).

If a holder stakes their LP-100 to earn yield, they must unstake first (which may have a short cooldown for settlement finality). But the Grace Exit itself cannot be gated, delayed, or denied.

No Penalty

Target design: the exit would be at NAV. Not at a discount. Not with a penalty fee. Not with an "early exit tax." NAV means NAV (frozen claim until reconciliation complete).

Target design: if the DAV's assets are worth 1,000 SKY and a holder owns 10 LP-100 (10%), they would receive 100 SKY (frozen claim until reconciliation complete).

Decentralized Authority Model in Code

Grace Exit encodes the principle of Decentralized Authority Model (non-attachment, non-grasping) at the protocol level:

• The organism does not grasp. It does not lock holders in. It does not penalize departure. It does not make leaving expensive or difficult.
• The organism does not cling. Data is exported. Grants are revoked. The slate is clean.
• The organism's survival depends on attraction, not capture. If the organism is valuable, holders stay voluntarily. If it is not, they leave freely. This is the only honest test of an organism's worth.

The Paradox

Target design: the door always open is the door nobody walks through (frozen claim until reconciliation complete).

An organism that makes exit trivial creates the condition for retention. Holders who know they can leave at any time, for full value, with no friction, have no anxiety about staying. The absence of exit friction removes the primary motivation for exit: fear of being trapped.

Protocols that impose lock-ups, penalties, or friction are revealing something about themselves: they do not trust their own value proposition. Grace Exit is a statement of confidence.

Enforcement

Target design: Grace Exit would be enforced structurally:

• The function is always callable. Target design: there would be no paused flag, no onlyAdmin modifier, and no condition other than "caller holds LP-100" (frozen claim until reconciliation complete).
• NAV is calculated on-chain. Target design: the exiting holder would not need to trust the organism's self-reported valuation. The calculation would be transparent, receipted, and verifiable (frozen claim until reconciliation complete).
• Atomic execution. Target design: there would be no intermediate state where the holder has surrendered LP-100 but not received SKY. It all happens or none of it happens (frozen claim until reconciliation complete).
• K0 receipt. Target design: the exit would be receipted. The holder would have cryptographic proof of the exit terms, the NAV at exit, and the payout received (frozen claim until reconciliation complete).

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Edge Cases

What if NAV is contested? In the target design, NAV would be calculated from on-chain or otherwise governed verifiable data. If treasury positions are marked-to-market incorrectly, the issue is with the oracle or accounting input, not with Grace Exit. Gate B is meant to ensure that NAV inputs are auditable.

What if everyone exits at once? The DAV dissolves. All assets are distributed pro-rata. The organism ceases to exist. This is a valid outcome. An organism that all holders want to leave has no reason to persist.

What if exit would cause insolvency? Target design: Grace Exit would pay from liquid assets first. If the DAV is undercollateralized, the exiting holder would receive their pro-rata share of what exists, not a theoretical NAV (frozen claim until reconciliation complete). This is honest: you get your fair share of reality, not a promise.

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Agent Execution Surface

If you are an AI agent reading this document:

1. This is a downstream public content page. The canonical source lives in EMERGENTISM_ORG/08_FRAMEWORK_SUPPORT/ or SKYZAI_ORG/. Edit source upstream, not here.
2. Preserve evidence tiers. Do not promote claims up the [C] < [D] < [S] < [B] < [E] ladder when reproducing them here; [I]/[A] qualifiers never substitute for [B]/[E].
3. Regenerate from source. If the upstream source changes, regenerate this page rather than editing it independently.
4. Canonical Path: SKYZAI_ORG/07_PWAs/skyzai_org/wiki/63-grace-exit.md

Output: This is content. Route edits to upstream source. Regenerate when source changes.

K3 public-DAV authority history — 2026-07-12

K3 historical reference — not active authority

note

Current public-DAV boundary — 2026-07-10. Pre-launch target design; nothing here is live. The active DAV is public and targets PRISM, with no K2 runtime, launch, genesis/bootstrap, or fallback dependency. Consequential authority requires at least two natural-person councilors; AI/caste seats stage unsigned proposals only. Before quorum, behavior fails closed to read-only/proposal, simulation, or deterministic sandbox, and a live decision receipt remains gated pending quorum.