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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: MGV who wrote (15413)	10/24/1999 8:56:00 PM
From: kolo55	Read Replies (1) \| Respond to of 27311

Valence's plan to raise capital... has been described in the conference calls and in the SEC documents pertaining to the secondary proposed for when the timing is right. "If the revenues you rely on are not insignificant, how do you reconcile the difficulty the company is having attracting sufficient capital to eliminate negative working capital and put the monthly dilutive deals behind them to produce? It is 10/24 and they have been unable to do it though you apparently believe they have been generating significant revenue for weeks or months." Valence said that they have generated revenues in the SepQ, and will make the transition in accounting from a R&D company to accounting consistent with an operating company for that Q. But you have set up another 'straw man' by claiming significant revenues in the SepQ. Actually the company has forecasted that they hope to breakeven on a cash flow basis for the DecQ (the current Q), and thus this is the first Q we will see really significant revenues and new order/contracts sufficient to float the secondary they have registered. The two underwriters for this secondary are large well-known securities firms. I believe this secondary will occur in the next three months, consistent with Valence's current plans. This is one more reason to be bullish on the stock, since management expects they will be able to do the secondary in this timeframe. If the schedule slips a month or so, it still won't be a big problem. BTW, how do you raise new capital without it being dilutive? You imply in your statement that they must attract new capital without dilution. All new capital is dilutive, when considered on its own. Have you discussed your concerns regarding Valence's plan for capital formation with the CFO Jay King? What was his response? Paul