VALENCE TECHNOLOGY (VLNC) Message Board

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Technology Stocks : VALENCE TECHNOLOGY (VLNC)

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To: kolo55 who wrote (11375)	5/25/1999 3:20:00 PM
From: Larry Brubaker	Read Replies (1) of 27311

<<What is your read on the impact of today's announcement on the variable financing issue? Does your "death spiral" scenario kick in this summer?>> Paul, today's announcement has nothing to do with a potential floorless conversion. The conversion of the 2nd tranche this summer is not tied to a contract announcement (or lack thereof), if I recall correctly. The conversion of the 2nd tranche is at the fixed rate of $6.03 until July, when it becomes the lower of the fixed or variable price. Presuming VLNC gives the market enough postive news between now and July to keep the price comfortably above $6, the conversion should take place at the fixed price. <<Also since you have been greatly concerned about Valence's cash position: What impact does today's announcement have on IDB grants? Are they now eligible for grants in the $20-30M range?>> I have no idea. However, I would think VLNC will be anxious to announce when they've got the IDB money, as it will remove a great deal of uncertainty about their immediate cash needs.

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