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

To: jean1057 who wrote (2066)	2/8/1998 2:18:00 PM
From: Larry Brubaker	Respond to of 27311

Jean Claude: I hope the theory about selling in order to exercise options is correct, also. It is, of course, just a theory. But I put it out there as a plausible positive explanation for Cal's selling, rather than the negative "rats jumping off a sinking ship" theory. Put yourself in Cal's shoes. He left the company in December with 600,000+ shares of stock and 600,000+ exercisable options that must be exercised within 90 days. But he needs $800,000 to exercise the options. Even though he was making $250,000 a year, he probably doesn't have $800,000 lying around the house. So, why not sell 400,000 or so shares for about $1.8 million, exercise $800,000 worth of options, and put about a million in the bank for "boat repairs?" You end up with more shares than you started with, and $1 million in your pocket. If I were Cal, and still believed in the prospects of the company, that is exactly what I would do.