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

To: P. Ramamoorthy who wrote (25650)	11/5/2002 11:46:39 PM
From: Larry Brubaker	Respond to of 27311

You suggested the purpose of the reorganization is to reduce the dilution from the Berg floorless equity line of credit. The reorganization will only reduce the dilution from the Berg financing IF they cut the quarterly burn rate from the historical $9 million per quarter to less than $5 million per quarter. Because the Berg financing is limited to $5 million per quarter anyway. My point is the purpose of the reorganization is to address the reality that they now must live within a $5 million/quarter burn rate (including $1.1 million quarterly debt service to Berg). They had no choice but to cut expenses. In all likelihood they will still use the maximum $5 million per quarter from Berg even having cut expenses.