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

To: Herb Blair who wrote (4392)	10/10/1998 10:38:00 AM
From: John Curtis	Respond to of 27311

To All: Just to reflect back, here's a synopsis of the last conference call. This was gleaned from a tape Fred was kind enough to provide to me since I wasn't able to attend it. Here ya go: L.D. began by making "foreward looking" statements, etc.. He started by stating he'd made a trip both to several potential customers and to the plant in N.I.. They've made their first films from the plant which "are the key to the success of the batteries." They're moving personnel, mostly technical, from Henderson to N.I.. In Henderson they're continuing to deal with potential customers, which at this point number in the range of 14, whom they are currently working with and who quote "have been cycling batteries for some time" unquote(personal note--this implies that by this time OEM should have enough data to begin to make decisions, eh?). He then turn over the call to D.A. who talked about current financials. This is something we all know. L.D. then opened the floor to questions: Covington & Associates: "You are "negotiating with 14 customer" which covers a wide area of possibilities. Are we coming into endgame, etc.? Can you speak to this?" L.D. I didn't say we're negotiating with 14 customers, BUT that we're providing samples to 14 customers. We're not negotiating with all of them...I won't go into the number but we are speaking with "several." He then spoke about the re-packing aspects of the batteries, and that VLNC will have to help them(customers) with the electronics, that they're talking with the customers technical crews, and in some cases are discussing terms and conditions, and delivery schedules and they have to be able to satisfy the customers that they can produce the batteries in N.I.. He then spoke about the portable computer manufacturers, that there's such a competitive edge to be gained by using VLNC technology and that they're willing to "take some risks." VLNC is testing most of the equipment in N.I. right now, with a couple of pieces of equipment to be modified this week. He expects to be producing some "fairly decent" batteries in the next 30 days, understanding they have to test the batteries for at least a month to determine if they're good or not, and they quarantined the batteries for the 30 days after that. Phoenician Financial: "Has management and R&D taken into account that given the amount of time it has taken to bring the Lith-poly battery to market that it could be made obsolete by competitive advances?" L.D. He's unaware of any technologies that could threaten obsolescences except those technologies they themselves have under development. He spoke to the fact of the "many hundreds of patents" and that he "doesn't know how any competitor can manufacture Lith-poly batteriers without stepping on one of their patents although he supposes its possible." He also stated that they're developing materials that are "revolutionary and very exciting" and which they expect to be submitting patents on in the near future. He considers this statement an "optimistic viewpoint of VLNC's future." Baysouth Company: "How comfortable are you with the N.I. yields, and 2ndly has all the equipment for N.I. been installed and 3rd his thoughts on analysts visits." L.D. The major equipment that they have are all running, the large battery line(to be online this week, as well as the packaging line). They've been shipping film from Henderson to N.I. in order to debut, but are now able to make this in N.I.. He mentioned that small battery lines, after modifications, are ready to go around Sept., along with the packaging aspect in the same time-frame. All in all, the "pace has picked up." He stated, "It's our game to lose now." Regarding yields, he expects yields to be better that the liquid electrolite market but he cannot say EXACTLY what those yields will be, but that they're running better than 50% now. Regarding analysts, he expects them in the next "3 to 4 weeks." L.D. went on to say, "I'd like to have them over there(in N.I.) before the next conference call." RR Capital Group: A question asked about burn rate, money from Delphi, etc.. This we know me thinks.... Prudential Securities: "Congrat's on financing. But, for the folks who provided the monies, what kind of d.d. was done?" L.D. Extensive d.d was done both at Henderson and at N.I. and they hire consultants to examine the technology, and these consultants also evaluated VLNC's "clients." D.A. chimed in with "believe me...this was a very tough two months we spent with them." (cont.)