Press Release

TAMPA, Fla.--(BUSINESS WIRE)--Dec. 20, 2002--Liquidmetal Technologies (NASDAQ:LQMT) today announced it has entered into an exclusive, multi-year agreement with DePuy Orthopaedics, Inc., a Johnson & Johnson company, to co-develop orthopaedic implants and instruments for the $2.4 billion knee replacement market.

The agreement gives DePuy Orthopaedics the exclusive worldwide right and license to engage with Liquidmetal Technologies in the development of knee replacement devices based on Liquidmetal's patented amorphous alloy technology and to sell knee replacement devices that incorporate components made from Liquidmetal(R) alloys.

Under terms of the agreement, Liquidmetal will receive scheduled cash payments upon completion of specific prototype milestones, culminating in the receipt of FDA marketing approval. Thereafter, Liquidmetal will receive royalty payments from net sales of knee replacement devices developed under the program and marketed by DePuy. All product components will be manufactured by Liquidmetal Technologies and sold to DePuy, with DePuy providing full marketing and distribution services. The agreement is initially expected to run the life of related Liquidmetal Technologies patents extending to 2020.

John Kang, Liquidmetal Technologies' President and Chief Executive Officer, commented, "Our decision to partner with DePuy was an easy one. They are the acknowledged leader in this large market arena and are dedicated to bringing state-of-the-art products to their customers. We believe the combination of our revolutionary alloy technology and DePuy's world class team of product development, engineering and marketing personnel can be a potent force in driving the creation of higher performance components and knee replacement devices. We look forward to working with them in this exciting and highly visible product area."

The joint product development program combines the advanced materials technology of Liquidmetal alloys with DePuy's industry leadership in design innovation, manufacturing and marketing of orthopaedic devices. Liquidmetal Technologies is the leading developer of products made from bulk amorphous alloys. Liquidmetal alloys possess a unique atomic structure that provides strength more than two times greater than titanium yet have the ability to be molded into precision, net-shaped components for an array of product applications spanning multiple industries. The medical device market is a major focus of the company's research and product development efforts.

About Liquidmetal Technologies

Liquidmetal Technologies (www.liquidmetal.com) is the leading developer, manufacturer, and marketer of products made from amorphous alloys. Amorphous alloys are unique materials that are characterized by a random atomic structure, in contrast to the crystalline atomic structure possessed by ordinary metals and alloys. Bulk Liquidmetal(R) alloys are two to three times stronger than commonly used titanium alloys, harder than tool steel, and relatively non-corrosive and wear resistant. Bulk Liquidmetal alloys can also be molded into precision net-shaped parts similar to plastics, resulting in intricate and sophisticated engineered designs. Liquidmetal Technologies is the first company to produce amorphous alloys in commercially viable bulk form, enabling significant improvements in products across a wide array of industries. The combination of a super alloy's performance coupled with unique processing advantages positions Liquidmetal alloys for what the company believes will be The Third Revolution(TM) in material science.

This press release may contain "forward-looking statements" that involve risks and uncertainties, including statements regarding our plans, future events, objectives, expectations, forecasts, or assumptions. Any statement in this press release that is not a statement of historical fact is a forward-looking statement, and in some cases, words such as "believe," "estimate," "project," "expect," "intend," "may," "anticipate," "plans," "seeks," and similar expressions identify forward-looking statements. These statements involve risks and uncertainties that could cause actual outcomes and results to differ materially from the anticipated outcomes or result, and undue reliance should not be placed on these statements. These risks and uncertainties may include: our limited operating history in developing and manufacturing products from bulk amorphous alloys; the adoption of our alloys by customers; the commercial success of our customer's products; our ability to identify, develop, and commercialize new applications for our alloys; competition with suppliers of incumbent materials; the development of new materials that render our alloys obsolete; the ability to manage our anticipated growth; our limited direct experience in manufacturing bulk alloy products; scaling-up our manufacturing facilities; protecting our intellectual property; problems associated with manufacturing and selling our alloys outside of the United States; and other risks and uncertainties discussed in filings made with the Securities and Exchange Commission (including risks described in subsequent reports on Form 10-Q, Form 10-K, Form 8-K, and other filings). Liquidmetal Technologies disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

--30--RLG/ny