X-Message-Number: 22212
From: 
Subject: Clarifications to 22199
Date: Wed, 16 Jul 2003 09:29:28 -0700

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July 16, 2003

From Michael Riskin
        Chairman, Alcor Board of Directors.   


Following is additional or clarifying information related to Rick Potvin's 
report on the Alcor board meeting of July 13, 2003:


* Mr. Potvin indicates that the reason Alcor recommends that terminal members 
relocate to the Phoenix area is to " reduce the load on the foundation". The 
primary reason for the recommendation is that the member will have the Alcor 
Arizona headquarters stabilization and surgical team immediately available, 24/7
upon need. Among other advantages of this proximity, the time from 
pronouncement to the operating room, can be shortened to minutes rather than the
hours required from a more remote location. An additional advantage is that 
there is a cost reduction for both the member and for Alcor, due to such 
proximity. 


* Mr Potvin indicates that the Patient Care Trust ( PCT) has about $2,000,000 in
both assets and liabilities. That is true. It is also important to understand 
what the liability represents. It is the amount put aside, from patient funding,
conservatively recorded as a long term patient care reserve liability, to be 
used exclusively for patient expenses.  It does not represent liabilities to 
outside vendors or creditors. The income generated from these assets is 
sufficient to cover all annual costs, leaving the principal intact. These funds 
are completely segregated (and administered by its' own board) from the general 
operating funds, not to be used for anything but long term patient storage and 
hopefully, reanimation expenses. 


* Mtr Potvin mentions the current negative cash flow that is unrelated to 
patient care. About 25% of the deficit is for one time facility expansion and 
technical upgrades. Alcor has sufficient operating cash reserves for about two 
years, conservatively assuming no other sources of revenue arise. (There is a 
major bequest currently being probated but Alcor does not count anything until 
it is received.) Further, non member care cost reductions that have been 
initiated in the past few months, have just started to kick in. Lastly, 
following its' conservative ( and correct, according to generally accepted 
accounting principles) policy, Alcor records all member prepaid funding as a 
debt rather than current income, since the member can always request a refund 
should 

(s)he change their mind. Another cryonics organization, by contrast, chooses to 
record such funding as current revenue, available for general operating and 
administrative expenses. 

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