(Source: Business Wire)Valence Technology, Inc. (NASDAQ: VLNC), a U.S. based, international developer of lithium iron magnesium phosphate energy storage solutions, announced today it has entered into a common stock purchase agreement with Seaside 88, L.P. ("Seaside"), a private investment limited partnership. Under the terms of the Agreement, Seaside has committed to purchase up to 16.9 million Valence common shares, in a series of closings every two weeks in the amount of 650,000 shares each for a total of up to 26 purchases. Today, Valence and Seaside expect to close the first sale of 650,000 shares for gross proceeds of $947,770.

"The expected proceeds from this financing will be used for working capital and general corporate purposes, including our ongoing sales and marketing and research and development programs," said Robert L. Kanode, Valence Technology president and CEO. "We welcome Seaside's investment and appreciate the continued support from all our shareholders."

The price of the shares to be sold at today's initial closing will be $1.45, a 12% discount to the 10 day volume weighted average trading price ("VWAP") of the Company's common stock ending October 14, 2009. At each scheduled closing, the price of the shares of common stock to be issued will be determined by applying a 12% discount to the 10-day VWAP preceding the closing. If, with respect to any subsequent closing, the three-day VWAP immediately preceding the closing is below $1.00 per share, then the closing will not occur and the aggregate number of shares of common stock that will be purchased under the Agreement will be reduced by 650,000 shares. If the dollar amount of the investment on any scheduled closing date is more than double the amount of the investment on the prior closing date, then Seaside has the option to reduce the number of shares purchased on that date to an amount no less than double the amount of the investment in the prior closing date.

Seaside has also committed in the stock purchase agreement that it has not sold short any of Valence's shares nor will it do so in the future while it is a common stockholder. There are no warrants associated with this agreement. Valence has the right to discontinue the agreement after six closings and under certain other conditions either party may terminate the stock purchases by Seaside.

Valence is offering the securities in this agreement pursuant to an effective shelf registration statement. The offering is being made only by means of a prospectus.