X-Message-Number: 6547
Date: 17 Jul 96 00:12:14 EDT
From: Paul Wakfer <>
Subject: Re: Prometheus problems
In Cryonet #6523 Bob Ettinger wrote:
>2. One potentially VERY serious problem seems to have been ignored so far on
>CryoNet. If I understand it correctly, the Prometheus pledgers will be
>required to make a BINDING commitment to an annual payment over ten years.
>They will be sold shares, and will OWE THE MONEY, with no way out--short of
>bankruptcy or hiding--unless they can find buyers for the shares, and are
>allowed to sell.
This last line is a misconception. The shareholders will receive the shares
yearly as they make the yearly payments which, yes, they will be legally
bound to make. However, they won't have to *sell* shares to make a payment
which they cannot, because of unforeseen circumstances, make. They will only
have to find someone *else* to buy the shares. That is a little broader and
possibly easier and the contract will be written that way.
But to continue Bob's valid criticism:
>Of course Paul's motivation in proposing this is understandable: he wants no
>possibililty of interruption of the funding, so the prospective researchers
>can be assured of a full ten years of support. However, how many
>people--after thinking it over carefully, consulting spouses etc.--will want
>to make a substantial, irrevocable ten year commitment? Will they not worry
>about possible changes in circumstances? If a pledger (shareholder) dies,
>will Prometheus sue his estate for the balance?
$1,460,000.00 worth of pledgers have done so already trusting that these
legitimate concerns *will* be addressed. Fortunately, many individuals in
this world are quite confident of their ability to produce wealth. However,
it is correct that cryonics organizations being responsible for totally
helpless patients *should* be more timid and cautious. But then *that* is why
this project has not been done and would likely never be done by the cryonics
organizations. And it is why I don't expect nor urge much from the
organizations except to advertise the project and to accept directed
donations of money which they wouldn't otherwise obtain and pass it on to the
project.
and Bob continues:
>In the case of a cryonics organization, would it be prudent to make a
>substantial and irrevocable pledge, which would take precedence even over
>the welfare of its patients if there were financial problems down the line?
>Naturally I understand the potential benefits, pointed out by Paul and by
>Saul Kent and others, but there are certain hard facts to face.
>
>The flintiest is that, to my knowledge, NO cryonics organization at present
>has an ASSURED income adequate to its needs, even before Prometheus.
This is a very legitimate concern which Bob has shown good insight by
noticing. I was aware of this myself from the beginning, but decided to
ignore it because I believed that it could simply be overcome by the
organizations committing themselves, when they pledged to do all the fund
raising necessary to fulfill the share purchase agreement for the full 10
years if necessary. However, the problem arises because while the corporation
which executes the project *can* have all its share purchasers sign legally
binding contracts to make a certain minimum yearly share purchase for up to
10 years, the cryonics organizations *cannot* make any such contract with
pledged donors. So that there is nothing to prevent a pledger of a donation
from simply stopping his or her donations after a few years. At that time the
cryonics organization would be left "holding the bag", since the cryonics org
*would* be signed up to a legally binding contract for share purchases. As I
said before I could not and cannot think of a good solution to this very real
problem. It is my belief that such pledge default could be made up by the
cryonics org doing more fund raising for this purpose. However, if at that
point in time the project research were not going well, for example, getting
such donations might be difficult. No, other than by getting in all the
donations for all 10 years *up-front*, there appears to be no real solution.
This *very real* problem is one of the reasons why I am not *relying* on
organizational donations, but at the same time I am trying to *encourage*
them by making some benefits available.
One valuable suggestion which has been made to me privately by Brian
Wowk is to incorporate in the organization's share purchase agreement an
escape clause which would allow them to legally default on their contract if
their patients were in danger. For all pledgers there could be such a clause
to allow such defaults if documentation of unforseen and dire financial
disaster was produced. Brain stated, "I know that I would not be able to sign
a legally binding pledge agreement without such a provision". I believe that
he meant that both personally and as President of CryoCare.
I believe, therefore, that we make take it as a given, that such an
escape clause *will* appear in all share purchase agreements.
-- Paul --
!!!!! REVERSIBLE BRAIN CRYOPRESERVATION *CAN* BE ACHIEVED IN 10 YEARS !!!!!
Paul Wakfer email: Voice/Fax: Pager:
US: 1220 E Washington St #24, Colton, CA 92324 909-481-4433 800-805-2870
Canada: 238 Davenport Rd #240, Toronto, ON M5R 1J6 416-968-6291 416-446-9461
(currently in Canada)
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