Press Release

TAMPA, Fla.--(BUSINESS WIRE)--Dec. 31, 2003--Liquidmetal(R) Technologies, Inc. (Nasdaq:LQMT) today announced various consolidation measures, including key executive changes, as part of a previously announced shift in the company's operating strategy, as well as the appointment of a lead independent director by its board of directors.

As reported in October, the company is pursuing a revised operating strategy more heavily weighted toward funded, strategic partnerships -- in the form of technology licensing, joint development and product distribution relationships -- as the principal means of advancing its amorphous alloy technology, as opposed to its previous internal-only manufacturing business model.

The company announced today, as a further advance of this revised strategy and for greater operating efficiency, that it is consolidating all corporate executive and administrative activities into its Lake Forest, California corporate technology center and closing its Tampa, Florida office effective December 31.

"This action establishes Lake Forest as the company's headquarters and unites all executive, marketing, engineering and administrative functions in the same location as our internal R&D activities and, importantly, in closer proximity to our ongoing technology development programs at the California Institute of Technology, where Liquidmetal(R) alloys were discovered in the early 1990s," said Chairman and CEO John Kang. Kang has already relocated to the Lake Forest office, where he leads a team including Liquidmetal alloy co-discoverers and senior company executives William J. Johnson, Ph.D and Atakan Peker, Ph.D, as well as oversees the company's manufacturing facility in South Korea.

Relocation of the corporate functions currently performed in Tampa will result in a handful of transitional changes to the company's senior management team, including the following:

• R. Brian McDougall, Executive Vice President, Chief Operating and Financial Officer, and a lifelong resident of the Tampa area, will not relocate to Lake Forest but will remain with the company in his current role for an extended transition period in order to assist with the company's ongoing efforts related to securing additional funding, transferring operations to Lake Forest, completing the 2003 year-end audit, and deploying the revised business strategy.
• David A. Nail has been promoted to Vice President-Finance from his previous role as Corporate Controller and will assume McDougall's financial responsibilities following the transition period. Nail joined the Tampa office in May 2002 with over 20 years of comprehensive financial and strategic management experience with public and private corporations, including Progress Energy and its predecessor, Florida Progress Corporation, Florida Power and Light, and as chief financial officer for JCI Jones Chemicals, Inc.
• David Binnie, Ph.D, currently Senior Vice President-Human Resources, will also transfer to California in an expanded role as Senior Vice President-Administration and Corporate Secretary. Dr. Binnie joined the company in October 2001.
• Thomas N. Trotter, Senior Vice President-Manufacturing, and Scott Wiggins, Executive Vice President and Chief Strategy Officer, will leave the company. Replacements for their positions are not planned at this time, in light of the company's revised business strategy.
• Dennis Ogawa, who is currently based in California as Vice President-R&D Operations, will assume a broader role as newly appointed Vice President-Operations, assisting CEO John Kang with manufacturing, product development and strategic partnership initiatives. Ogawa joined the company in October 2002 with more than 16 years of leadership experience in industry and consulting assignments in engineering and product/customer development. Prior to joining Liquidmetal Technologies, he was Vice President, Product Development-RV Group for Fleetwood Enterprises. Before joining Fleetwood, he was a principal for management consulting firm Pittiglio Rabin Todd and McGrath (PRTM) specializing in improving product development, operations performance, and customer service for high technology companies. Prior to PRTM, he was a Senior Engineer for Honda R&D North America.

Other key Tampa-based personnel will either relocate to the Lake Forest office or serve in a transitional capacity for a specified period of time.

"We value the tremendous contributions of Brian, Tom, Scott and the other key members of our Tampa management team during Liquidmetal Technologies' formative first two years, but fully appreciate and respect their personal reasons for remaining in the Tampa area. At the same time, we welcome our transitioning team members, including David Nail and David Binnie, who will join Drs. Johnson and Peker and the rest of our Lake Forest team in executing the company's revised strategy for commercializing our revolutionary alloys," said CEO Kang. "All agree that consolidation of operations at Lake Forest is in the best long-term interests of the company, financially and operationally. With a new operating focus, along with a low-cost operating foundation, we believe Liquidmetal Technologies will be effectively positioned in 2004 to capitalize on new growth opportunities and realize increased value for our shareholders."

One-time charges associated with the recent consolidation moves have not been finalized but will be reported in conjunction with the company's results for the fourth quarter ending December 31.

Kang noted that the company is proceeding with previously announced cost reduction measures related to the strategy shift that it now expects will produce a quarterly operating expense run rate below $2.5 million in the first quarter of 2004, representing a 71% reduction in quarterly operating expenses versus the first quarter of 2003. These cost improvements are being achieved through a combination of rigorous spending controls, personnel reductions, and the consolidation of facilities.

Operations at the company's manufacturing plant in Pyongtaek, South Korea, are currently focused on production of select, higher-margin cell phone components, principally for long-standing customer Samsung Electronics, and development and prototyping of other premium products that will command pricing based on the high-performance characteristics of Liquidmetal(R) alloys. Sales of proprietary Liquidmetal(R) industrial coatings, and ongoing research and development of defense industry products, are expected to continue to provide an underlying base of revenues as the company transitions to the revised business model.

In a separate action stemming from recent trends to improve public company governance, the company's board of directors announced that it has elected retired three-star Lieutenant General Jeffrey W. Oster as its Lead Independent Director. In this newly created role, General Oster's responsibilities will include presiding over all executive sessions of the board's independent directors and, in concert with company Chairman and CEO John Kang, setting the board meeting agenda, board policy, committee composition, and meeting schedules, and ensuring the quality, quantity and timeliness of information flow to the independent directors. General Oster has been a director since April 2002 and currently serves as chairman of the board's corporate governance committee and as a member of its audit committee. He retired from the United States Marine Corps as a Lieutenant General in 1998, following nearly 35 years of active duty. From 1993 until his retirement, he served as the Deputy Chief of Staff for Programs and Resources where he was responsible for all aspects of financial management for the Marine Corps, including development, implementation, and execution of a strategic financial plan and $17.5 billion annual budget. In this capacity, he played a lead role in defining, supporting and defending the Marine Corps' resource requirements in the Department of Defense, the Office of Management and Budget, the White House, and before Congress. He is currently a consultant to various organizations on defense-related matters.

About Liquidmetal Technologies, Inc.

Liquidmetal Technologies, Inc. (http://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.

CONTACT: Liquidmetal Technologies, Inc., Tampa
David Townsend, 813/314-0280 ext. 127
david.townsend@liquidmetal.com

SOURCE: Liquidmetal Technologies, Inc.