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

To: Rich Wolf who wrote (8159)	2/10/1999 7:41:00 PM
From: Jacques Tenzel	Respond to of 27311

New Insider Open Market Purchase Confirmed Bert Roberts purchased 10,000 shares of VLNC on 1/4/99 at 7.44 and another 10,000 shares on 1/5/99 at 7.50 for a total holding of 50,000 shares.

To: Rich Wolf who wrote (8159)	2/10/1999 8:21:00 PM
From: I. N. Vester	Read Replies (1) \| Respond to of 27311

I asked Lev about finances at the SM. He responded by discussing plans for a secondary stock offering AFTER P.O.'s at a higher price. I did not have the 10-Q info available, so I was unable to dig further regarding short term needs. From the response i did get from Lev, along with what I've heard from other sources, I am sure that he has some short term arrangements worked out already, which i believe will probably be a loan with a warrant kicker for a reasonably small number of shares. I'm sure it would be impossible to do a secondary offering this quarter even if P.O.'s were announced tomorrow. Therefore I'm 100% confident that if the cash actually is that tight already, Lev already has a short term agreement in his pocket. The chicken littles will probably come out again like they do each quarter screeching about how the company is bankrupt and doomed. Anybody who has been in this stock for more than 1 quarter ought to be immune to that talk by now. We all know how Lev operates, and that he's not going to waste much energy to discuss it, nor will he ever talk about what he has up his sleeve. I'm extremely confident that agreements are in place. Even with a P.O tomorrow, more working capital is needed short term before they get the $4M revenues required for the IBD financing to lick in. Obviously they cannot continue forever without shipping product, but you can be sure that they are not going to go bankrupt any time real soon. The sky is not falling. They most certainly have resources for however long they require before the IDB and other funds become available. Both Carl Berg and Lev sounded very confident when asked about their finances.

To: Rich Wolf who wrote (8159)	2/10/1999 10:54:00 PM
From: Larry Brubaker	Read Replies (2) \| Respond to of 27311

The 10-Q illustrates just how tight their financing was at the end of December. On December 21, the received a new payment of $7.5 million of convertible preferred shares from Castle Creek. On December 27, they had a grand total of $7.8 million of cash. So, they were down to about $300,000 of cash before Castle Creek bailed them out with the new $7.5 million. Working capital at the end of the quarter (even after Castle Creek's $7.5 million was added) was negative $2.5 million. Without Castle Creek's $7.5 million, they would have had $10 million of short-term obligations and $300,000 of cash. Also, I see no money from Mr. Berg was received during the quarter. So, that is the backward-looking comments. Now for forward-looking comments. They began the current quarter with negative $2.5 million in working capital. They had $7.8 million of cash, but their current liabilities exceeded current assets by $2.5 million. They clearly need more money. The filing says so in black and white, and also says their current funds should last them through March. So they've got another 6 weeks to raise more money. My suggestion. Watch for the terms of the new financing. If it is more floorless convertible junk, things are not as rosy as you might want to believe. If the financing is something more conventional, then maybe a big contract is near and you can breath easier.