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Valence Technology Wins European Patent Appeal

Monday, February 06, 2012

Austin, TX -- Valence Technology, Inc., a leading U.S.-based global manufacturer of advanced energy storage solutions for commercial applications prevailed in seeking the dismissal of an appeal by Hydro-Quebec (HQ) of a decision of the European Patent Office revoking a HQ European patent. The EPO Patent corresponded to the primary HQ patent being litigated in the Western District of Texas Federal Court (Austin). The patent is related to lithium metal phosphate technology.

Valence had challenged the grant of European Patent number 0904607, originally held by the University of Texas and now assigned to HQ, in an opposition proceeding in the European Patent Office filed on July 27, 2005. In December 2008, the EPO Opposition Board revoked the grant of the patent based on evidence presented by Valence showing that the patent lacked novelty. The Board's decision revoking HQ's European Patent eliminated any risk that HQ could assert the European Patent against Valence's proprietary lithium iron magnesium phosphate cathode material, a critical material for the next generation of advanced batteries. HQ filed an appeal of the 2008 revocation of the European Patent. The appeal hearing was heard and decided on February 2, 2012, by an EPO Board of Appeal, which dismissed HQ's appeal. As a result of the decision, European Patent number 0904607 has been revoked by the EPO in its entirety. Valence was represented in the opposition and the appeal by Dr. Claus Beckmann of the German Intellectual Property Law firm Kraus & Weisert.

"This decision removes any possible patent infringement claim under the Hydro-Quebec European Patent, thereby affirming Valence's unrestricted right to market its unique, patented lithium phosphate powder batteries in Europe. Valence's intellectual property is a key asset and we intend to vigorously protect our worldwide patent estate," said Roger Williams, Valence's General Counsel.

About Valence Technology, Inc.

Valence Technology is a global leader in the development and manufacture of safe, long-life lithium iron magnesium phosphate advanced energy storage solutions and integrated command and control logic. Headquartered in Austin, Texas, Valence enables and powers some of the world's most innovative and environmentally friendly applications, ranging from commercial electric vehicles to industrial and marine equipment. Valence Technology today offers a proven technology and manufacturing infrastructure that delivers ISO-certified products and processes that are protected by an extensive global patent portfolio. In addition to the corporate headquarters in Texas, Valence Technology has its Research & Development Center in Nevada, its Europe/Asia Pacific Sales office in Northern Ireland, manufacturing facilities in China, and global fulfillment centers in North America and Europe. Valence Technology is traded on the NASDAQ Capital Market under the ticker symbol "VLNC." For more information, visit

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including our statements regarding protecting our worldwide patent estate. Actual results may vary substantially from these forward-looking statements as a result of a variety of factors including the outcome of any future litigation regarding our intellectual property, our ability to effectively protect our intellectual property rights in Europe and other countries, our ability to further develop our intellectual property rights including our patent portfolio, financial or other limitations on our ability to protect our intellectual property and the actual performance characteristics of our products. In addition, patents are geographically territorial and a decision on European patents generally affects the acts of making, using, selling and importing products utilizing such technology in Europe. Other risk factors that could affect our actual results are discussed in our periodic reports filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended March 31, 2011, and our Quarterly Reports on Form 10-Q, and the reader is directed to these statements for a further discussion of important factors that could cause actual results to differ materially from those in the forward-looking statements.

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