LIQUIDMETAL TECHNOLOGIES INC (Form: 10-Q, Received: 11/04/2010 16:54:49)

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into effective as of August 3, 2010 (the “Effective Date”), by and between LIQUIDMETAL TECHNOLOGIES, INC., a Delaware corporation (the "Company"), THOMAS STEIPP , an individual residing in the State of California (the "Employee").

RECITALS

WHEREAS, the Employee desires to be employed by the Company upon the terms and conditions set forth in this Agreement; and

WHEREAS, the Company desires to assure itself of the Employee's continued employment in the capacities set forth herein.

NOW, THEREFORE , in consideration of the foregoing recitals and for other good and valuable consideration, the parties hereto covenant and agree as follows:

1. Employment. The Company hereby employs Employee, and the Employee hereby accepts such employment, upon the terms and conditions set forth in this Agreement.

2. Term . Subject to the terms and conditions of this Agreement, including, but not limited to, the provisions for termination set forth in Section 5 hereof, the employment of the Employee under this Agreement shall commence on the Effective Date and shall continue through the close of business on August 3, 2015 (the " Initial Term "). Upon the expiration of the Initial Term, the Employee’s employment with the Company will continue on an “at-will” basis and may be terminated by Employee or the Company for any reason and at any time, provided that the terminating party shall provide at least ninety (90) days prior written notice of the termination to the other party (unless the termination is With Cause as defined in this Agreement, in which case the Employee’s employment may be terminated immediately).

3. Duties . Employee will serve as PRESIDENT and CHIEF EXECUTIVE OFFICER of the Company. The Employee will devote his full business time, attention, skill, and energy to the business of the Company and will be a full-time employee of the Company. Employee will use the Employee’s best efforts to promote the success of the Company's business and will cooperate fully with the Board of Directors in the advancement of the best interests of the Company. Furthermore, the Employee shall assume and competently perform such reasonable responsibilities and duties as may be assigned to the Employee from time to time by the Board of Directors and Chairman of the Board of the Company or their designee. To the extent that the Company shall have any parent company, subsidiaries, affiliated corporations, partnerships, or joint ventures (collectively "Related Entities"), the Employee shall perform such duties to promote these entities and to promote and protect their respective interests to the same extent as the interests of the Company without additional compensation. At all times, the Employee agrees that the Employee has read and will abide by, and prospectively will read and abide by, any employee handbook, policy, or practice that the Company or Related Entities has or hereafter adopts with respect to its employees generally..

4. Compensation .

(a) Annual Base Salary . As compensation for Employee’s services and in consideration for the Employee's covenants contained in this Agreement, the Company shall pay the Employee an annual base salary of $300,000.00, which salary shall be paid in accordance with the Company’s regular payroll schedule and will be subject to applicable tax and other legally required withholdings. The annual compensation may be adjusted upward (but not downward) in the sole discretion of the Board of Directors. For purposes of this Agreement, the term “ Salary Year ” means the one year, 365-day period (or 366 day period for a leap year) that begins on the Effective Date and each successive one year period thereafter. The base salary established by this paragraph will be effective as of August 3, 2010, with any retroactive salary amount being payable by the Company within a reasonable period of time following the execution of this Agreement.

(b) Bonuses . In addition to the Employee’s annual base compensation, during the term of the Employee’s employment hereunder, the Employee shall be entitled to only such bonuses or additional compensation as may be granted to the Employee by the Board of Directors or Chairman of the Board of the Company, in their sole discretion.

(c) Reimbursement of Expenses . The Employee shall be reimbursed for all reasonable and customary travel and other business expenses incurred by Employee in the performance of Employee’s duties hereunder, provided that such reimbursement shall be subject to, and in accordance with, any expense reimbursement policies and/or expense documentation requirements of the Company that may be in effect from time to time

(d) Stock Grant . In addition to the foregoing, in consideration of the execution of this Agreement by the Employee, the Company shall, on the date hereof, grant to the employee 6,000,000 shares of the common stock of the Company in accordance with a restricted stock agreement in the form set forth as Exhibit A hereto.

(e) Other Benefits . During the term of the Employee’s employment hereunder, the Employee shall be eligible to participate in such pension, life insurance, health insurance, disability insurance and other benefits plans, if any, which the Company may from time to time make available to similar-level employees.

(f) Vacation . The Employee shall be entitled to 4 Weeks paid vacation during each Salary Year during the term of the Employee’s employment hereunder. Vacation shall be taken at such times and with such notice so as to not disrupt or interfere with the business of the Company. Unused vacation from a particular Salary Year will not be paid in cash but will carry over to succeeding Salary Years up to a maximum of 3 Weeks , and no more than 3 weeks of carried-over vacation may be taken during any Salary Year.

5. Termination .

(a) Death . The Employee's employment under this Agreement shall terminate immediately upon Employee’s death. In the event of a termination pursuant to this Section 5(a), the Employee’s estate shall be entitled to receive any unpaid base salary owing to Employee up through and including the date of the Employee’s death.

(b) Disability . If, during the term of the Employee’s employment hereunder, the Employee becomes physically or mentally disabled in the determination of a physician appointed or selected by the Company, or, if due to any physical or mental condition, the Employee becomes unable for a period of more than sixty (60) days during any six-month period to perform Employee’s duties hereunder on substantially a full-time basis as determined by a physician selected by the Company, the Company may, at its option, terminate the Employee's employment upon not less than thirty (30) days written notice. In the event of a termination pursuant to this Section 5(b), the Employee shall be entitled to receive any unpaid base salary owing to Employee up through and including the effective date of termination.

(c) Termination By Company Without Cause . In addition to the other termination provisions of this Agreement, the Company may terminate the Employee’s employment at any time without cause (a “Termination Without Cause”). In the event of a Termination Without Cause, the Employee shall continue to receive the Employee’s base salary (as then in effect) during the twelve (12) month period immediately following the effective date of the Termination Without Cause or, if shorter, through the last day of the Initial Term (the “Severance Period”). In addition to the severance pay described in the preceding sentence, the Employee shall continue, during the Severance Period, to receive all employee health and welfare benefits to which Employee was entitled immediately prior to the Termination of Cause, but only to the extent that the applicable benefit plan permits such continuation of benefits. Employee agrees and acknowledges, however, that Employee will forfeit the right to receive base salary and benefits during the Severance Period immediately upon the Employee’s breach of any covenant set forth in Section 6 of this Agreement. The Employee will also forfeit the right to salary and benefits during the Severance Period upon accepting employment with another employer with comparable salary, and benefits hereunder shall be forfeited and shall cease upon the Employee becoming eligible for benefits from the Employee’s new employer. Notwithstanding the foregoing, the termination of the Employee’s employment pursuant to the second sentence of Section 2 of this Agreement shall not constitute a Termination Without Cause and shall not give rise to any severance payment or other benefits pursuant to this Section 5(c). The Employee’s right to receive any severance payments pursuant to this Section 5(c) is conditioned upon the Employee signing a general release in form and substance satisfactory to the Company under which the Employee releases the Company and its affiliates, together with their respective officers, directors, shareholders, employees, agents and successors and assigns, from any and all claims Employee may have against them as of the date of such release (whether known or unknown), other than claims arising out of this Agreement.

(d) Termination By Company With Cause . The Company may terminate the Employee’s employment at any time with Cause. As used in this Agreement, "Cause" shall mean the following: (1) the Employee's failure or inability to perform Employee’s duties under this Agreement to the reasonable satisfaction of the Board of Directors of the Company after being given written notice of the Employee’s deficiencies and having a period of at least ten (10) days to cure such deficiencies to the reasonable satisfaction of the Board of Directors; (2) dishonesty or other serious misconduct, (3) the commission of an unlawful act material to Employee’s employment, (4) a material violation of the Company's policies or practices which reasonably justifies immediate termination; (5) committing, pleading guilty, nolo contendre or no contest (or their equivalent) to, entering into a pretrial intervention or diversion program regarding, or conviction of, a felony or any crime or act involving moral turpitude, fraud, dishonesty, or misrepresentation; (6) the commission by the Employee of any act which could reasonably affect or impact to a material degree the interests of the Company or Related Entities or in some manner injure the reputation, business, or business relationships of the Company or Related Entities; (7) the Employee's inability to perform an essential function of Employee’s position; (8) any material breach by Employee of this Agreement which, if unintentional and capable of being cured, is not cured within ten (10) of written notice of such breach by the Company to Employee. The Company may terminate this Agreement for Cause at any time without notice. In the event of a termination for Cause, the Company shall be relieved of all its obligations to the Employee provided for by this Agreement as of the effective date of termination, and all payments to the Employee hereunder shall immediately cease and terminate as of such date, except that Employee shall be entitled to the annual base salary hereunder up to and including the effective date of termination, provided, however, that the Employee’s obligations under Sections 6 and 7 of this Agreement shall survive such a Termination for Cause, and any other liabilities or obligations which have accrued and are owed by the Employee to the Company shall not be extinguished or released by such termination.

(e) Termination by Employee Upon Change in Control . In the event that a Change in Control (as defined below) occurs and Employee terminates his own employment with the Company by delivering written notice of termination to the Company within thirty (30) days after such Change in Control (an “Employee Termination Notice”), then Employee shall be entitled to lump-sum severance compensation in an amount equal to the amount of base salary to which Employee would have been entitled for the remainder of the Initial Term at the base salary rate being paid to Employee as of the date of the Change in Control (the “Change in Control Compensation”). The Change in Control Compensation shall be payable on the last pay day of the Company of the month in which the Change in Control occurs, but no earlier than fifteen (15) days after which Employee delivers the Employee Termination Notice to the Company. In addition to the Change in Control Compensation, the Employee shall, to the extent permitted by any applicable benefit plan, continue to receive, from the date of termination through the end of the Initial Term, all employee health and welfare benefits that Employee would have received during such period in the absence of such termination. Employee agrees and acknowledges, however, that Employee will forfeit the right to receive Change in Control Compensation and benefits during such period immediately upon the Employee’s breach of any covenant set forth in Section 6 of this Agreement. For purposes hereof, the term “Change in Control” means any of the following events: (i) any person, entity, or “group” (as described in Rule 13d-5(b)(1) promulgated under the Securities Exchange Act of 1934, as amended), other than an affiliate or subsidiary of the Company or an employee benefit plan established or maintained by the Company, a subsidiary of the Company, or any of their respective affiliates, acquires more than 50.0% of the combined voting power of the Company’s then outstanding securities; (ii) the consummation of (A) a merger or consolidation of the Company with or into another corporation unless, after giving effect to such transaction, the stockholders of the Company immediately prior to such transaction own more than 50% of the aggregate voting power of the Company or the successor entity of such transaction, or (B) a sale or disposition of all or substantially all of the Company’s assets; (iv) if during any period of two (2) consecutive years, individuals who at the beginning of such period constitute the board of directors of the Company (the “Continuing Directors”) cease for any reason to constitute at least a majority thereof; provided that any individual whose election or nomination for election as a member of the board of directors of the Company was approved by a vote of at least a majority of the Continuing Directors then in office shall be considered a Continuing Director. In the case of any ambiguity regarding the interpretation of the foregoing definition of “Change in Control”, such question shall be resolved in good faith by the board of directors of the Company. The Employee’s right to receive any compensation pursuant to this Section 5(e) is conditioned upon the Employee signing (on or before such compensation is due) a general release in form and substance satisfactory to the Company under which the Employee releases the Company and its affiliates, together with their respective officers, directors, shareholders, employees, agents and successors and assigns, from any and all claims Employee may have against them as of the date of such release (whether known or unknown), other than claims arising out of this Agreement.

(f) Special Termination . In addition to the foregoing, in the event that the Company does not within ninety (90) days after the date of this Agreement receive from Crucible Intellectual Property, LLC, a Delaware limited liability company and special-purpose wholly owned subsidiary of the Company (“Crucible”), the entire maximum amount of the second payment due to Crucible by Apple Inc. (“Apple”) pursuant to the Exclusive License Agreement of even date herewith between Crucible and Apple, the Company may at any time thereafter terminate this Agreement upon written notice to Employee. In the event of such a termination, the Company shall be relieved of all its obligations to the Employee provided for by this Agreement as of the effective date of termination, and all payments to the Employee hereunder shall immediately cease and terminate as of such date, except that Employee shall be entitled to the annual base salary hereunder up to and including the effective date of termination, provided, however, that the Employee’s obligations under Sections 6 and 7 of this Agreement shall survive such a termination.

6. Nonsolicitation and Nondisclosure Covenants.

(a) Rationale for Restrictions . Employee acknowledges that Employee’s services hereunder are of a special, unique, and extraordinary character, and Employee’s position with the Company places Employee in a position of confidence and trust with customers, suppliers, and other persons and entities with whom the Company and its Related Entities have a business relationship. The Employee further acknowledges that the rendering of services under this Agreement will likely require the disclosure to Employee of Confidential Information (as defined below) including Trade Secrets of the Company relating to the Company and/or Related Entities. As a consequence, the Employee agrees that it is reasonable and necessary for the protection of the goodwill and legitimate business interests of the Company and Related Entities that the Employee make the covenants contained in this Section 6, that such covenants are a material inducement for the Company to employ the Employee and to enter into this Agreement, and that the covenants are given as an integral part of and incident to this Agreement.

(b) Nonsolicitation Covenants . As used herein, the term " Restrictive Period " means the time period commencing on the Effective Date of this Agreement and ending on the second (2 nd ) anniversary of the date on which the Employee’s employment by the Company (or any Related Entity) expires or is terminated for any reason, including both a termination by the Company for Cause and Not for Cause. In addition, the term “ Covered Business ” means any business which is the same as, or similar to, any business conducted by the Company or any of the Related Entities at any time during the Restrictive Period. The Employee agrees that the Employee will not engage in any of the following acts anywhere in the world during the Restrictive Period:

(i)

directly or indirectly assist, promote or encourage any existing or potential employees, customers, clients, or vendors of the Company or any Related Entity, as well as any other parties which have a business relationship with the Company or a Related Entity, to terminate, discontinue, or reduce the extent of their relationship with the Company or a Related Entity;

(ii)

directly or indirectly solicit business of the same or similar type as a Covered Business, from any person or entity known by the Employee to be a customer or client of the Company, whether or not the Employee had contact with such person or entity during the Employee’s employment with the Company;

(iii)

disparage the Company, any Related Entities, and/or any shareholder, director, officer, employee, or agent of the Company or any Related Entity; and/or

(iv)

engage in any practice the purpose of which is to evade the provisions of this Section 6.

Employee acknowledges that Employee’s services hereunder are of a special, unique, and extraordinary character, and Employee’s position with the Company places Employee in a position of confidence and trust with customers, suppliers, and other persons and entities with whom the Company and its Related Entities have a business relationship. The Employee further acknowledges that the rendering of services under this Agreement will likely require the disclosure to Employee of Confidential Information (as defined below) and Trade Secrets (as defined below) of the Company relating to the Company and/or Related Entities. As a consequence, the Employee agrees that it is reasonable and necessary for the protection of the goodwill and legitimate business interests of the Company and Related Entities that the Employee make the covenants contained in this Section 6, that such covenants are a material inducement for the Company to employ the Employee and to enter into this Agreement, and that the covenants are given as an integral part of and incident to this Agreement.

(c) Disclosure of Confidential Information . The Employee acknowledges that the inventions, innovations, software, Trade Secrets, business plans, financial strategies, finances, and all other confidential or proprietary information with respect to the business and operations of the Company and Related Entities are valuable, special, and unique assets of the Company. Accordingly, the Employee agrees not to, at any time whatsoever either during or after the Employee’s term of employment with the Company, disclose, directly or indirectly, to any person or entity, or use or authorize any person or entity to use, any confidential or proprietary information with respect to the Company or Related Entities without the prior written consent of the Company, including, without limitation, information as to the financial condition, results of operations, identities of clients or prospective clients, products under development, acquisition strategies or acquisitions under consideration, pricing or cost information, marketing strategies, passwords or codes or any other information relating to the Company or any of the Related Entities which could be reasonably regarded as confidential (collectively referred to as “Confidential Information”). However, the term “Confidential Information” does not include any information which is or shall become generally available to the public other than as a result of disclosure by the Employee or by any person or entity which the Employee knows (or which the Employee reasonably should know) has a duty of confidentiality to the Company or a Related Entity with respect to such information. In addition to the foregoing, Company will be fully entitled to all of the protections and benefits afforded by the California Uniform Trade Secrets Acts and any other applicable law. The term “Trade Secret” shall mean any information, including a formula, pattern, compilation, program, device, method technique, or process that derives independent economic value, actual or potential, from being not generally known to, and not being readily ascertainable by proper means by, other persons who can derive economic value from its disclosure or use, including but not limited to the patented information and processes as well as the unpatented information and processes comprising, underlying, arising from, and associated with Liquidmetal alloys.

(d) Prevention of Premature Disclosure of Confidential Information and Trade Secrets . The Employee agrees and acknowledges that, because the success of the Company is heavily dependent upon maintaining the secrecy of the Company’s Confidential Information and Trade Secrets and preventing the premature public disclosure of the Company’s proprietary information and technology including its Confidential Information and Trade Secrets, the Employee agrees to use the Employee’s best efforts and his or her highest degree of care, diligence, and prudence to ensure that no Confidential Information or Trade Secret prematurely leaks or otherwise prematurely makes its way into the public domain or any public forum, including, without limitation, into any trade publications, internet chat rooms, or other similar forums. In the event that the Employee becomes aware of any premature leak of Confidential Information or Trade Secret or becomes aware of any circumstances creating a risk of such a leak, the Employee shall immediately inform the Board of Directors, the Chief Executive Officer, or the Employee’s supervisor of such leak or of such circumstances.

(e) Removal and Return of Proprietary Items . The Employee will not remove from the Company's premises (except to the extent such removal is for purposes of the performance of the Employee’s duties at home or while traveling, and under such conditions and restrictions as are specifically authorized and/or required by the Company) or transmit by any means, electronic or otherwise, any document, record, notebook, plan, model, component, device, computer software or code, or Confidential Information or Trade Secret whether embodied in a disk or in any other form, including electronic form (collectively, the " Proprietary Items "). The Employee recognizes that, as between the Company and the Employee, all of the Proprietary Items, whether or not developed by the Employee, are the exclusive property of the Company. Upon termination of Employee’s employment with the Company by either party (regardless of the reason for termination), or upon the request of the Company during the term of employment, the Employee will return to the Company all of the Proprietary Items in the Employee’s possession or subject to the Employee’s control, and the Employee shall not retain any copies, abstracts, sketches, or other physical embodiment of any of the Proprietary Items, Confidential Information, Trade Secret or any part thereof.

(f) Enforcement and Remedies . In the event of any breach of any of the covenants set forth in this Section 6, the Employee recognizes that the remedies at law will be inadequate and that in addition to any relief at law which may be available to the Company for such violation or breach and regardless of any other provision contained in this Agreement, the Company shall be entitled to equitable remedies (including an injunction) and such other relief as a court may grant after considering the intent of this Section 6. Additionally, the period of time applicable to any covenant set forth in this Section 6 will be extended by the duration of any violation by Employee of such covenant. In the event a court of competent jurisdiction determines that any of the covenants set forth in this Section 6 are excessively broad as to duration, geographic scope, prohibited activities or otherwise, the parties agree that this covenant shall be reduced or curtailed to the extent, but only to the extent, necessary to render it enforceable.

7. Employee Inventions .

(a) Employee agrees that any inventions, ideas, original works of authorship or other work product in whole or in part conceived or made by Employee which are made through the use of any of the Confidential Information or any of the Company's equipment, facilities, supplies, trade secrets or time, or which relate to the Company's business or the Company's actual or demonstrably anticipated research and development, or which result from any work performed by Employee for the Company, along with any rights in or to any of the foregoing under copyright, patent, trade secret, trademark, or other law, shall belong exclusively to the Company and shall be deemed part of the Confidential Information for purposes of this Agreement whether or not fixed in a tangible medium of expression. Without limiting the foregoing, Employee agrees that any such original works of authorship shall be deemed to be "works made for hire" and that the Company shall be deemed the author thereof under the U. S. Copyright Act (Title 17 of the U. S. Code), provided that in the event and to the extent such works are determined not to constitute "works made for hire" as a matter of law or that there are any rights that do not accrue to the Company as a work made for hire, Employee hereby irrevocably assigns and transfers to the Company all right, title and interest in and to such works, including but not limited to copyrights and other intellectual property rights. This Agreement shall be construed in accordance with the provisions of Section 2870 of the California Labor Code (a copy of which is attached as Exhibit A hereto) relating to inventions made by Employee, and accordingly this Agreement is not intended and shall not be interpreted to assign to or vest in the Company any of Employee's rights in any inventions other than those described in the first sentence of this Section 7(a).

(b) At all times during Employee's employment by the Company, Employee will maintain a complete and detailed current written record of all ideas, concepts, improvements, discoveries or inventions, of any nature ("Inventions"), whether patentable or not, created or made in whole or part by Employee, either solely or jointly with others, and Employee will promptly disclose any such Inventions to the Company, in writing. Employee further agrees that all such written records shall be and remain the sole and exclusive property of the Company, and Employee shall make such written records available to the Company at any time upon request, for review, inspection or copying by the Company, and shall deliver all copies of such records to the Company upon termination of Employee's employment, for any reason.

(c) With respect to Inventions made or conceived of in whole or part by Employee, either solely or jointly with others, whether during Employee's employment by the Company or after termination of such employment if developed using, applying or adapting, in any way, the Company's equipment, supplies, facilities, Confidential Information or trade secret information, or during Employee's working hours, or such Invention relates to the Company's business, or actual or demonstrably anticipated research or development, or results from any work done in whole or part by Employee, either solely or jointly with others, for the Company, or is based on or related to programs, processes, Inventions or information learned by Employee during such employment:

(i)

Employee shall inform the Company promptly and fully of such Inventions by a written report, setting forth in detail the procedures employed and the results achieved.

(ii)

Employee hereby expressly transfers and assigns to the Company all of Employee's right, title and interest in and to such Inventions; and to Applications for U.S. and/or foreign letters patent and/or copyrights as well as any and all continuations, continuations-in-part, and divisions thereof, and to U.S. and/or foreign letters patent and/or copyrights issued thereon, as well as any and all reissues, extensions, improvements, or further developments thereof.

(iii)

Employee shall apply, or assist the Company in applying, at the Company's request and expense, for U.S. and/or foreign letters patent and/or copyrights in the Company's name, or otherwise as the Company shall desire. The decision to obtain letters patent and/or copyrights shall reside solely with the Company; however, the decision not to obtain or apply for letters patent and/or copyrights at the time of disclosure or at any time thereafter, shall not be construed as a waiver of any rights hereunder.

(iv)

the Company shall also have the perpetual, royalty-free right to use in its business, to license others to use, and to make, use and sell products, processes and/or services derived from any Inventions, discoveries, designs, improvements, concepts, ideas, whether patentable or not, including but not limited to process, methods, formulas, techniques or know-how related thereto, which are not within the scope of Inventions as defined herein, but which are conceived or made in whole or part by Employee, either solely or jointly with others, during regular working hours or with the use of the Company's equipment, supplies, facilities, Confidential Information, trade secret information materials or personnel.

8. Essential and Independent Covenants . The Employee’s covenants in Sections 6 and 7 of this Agreement are independent covenants, and the existence of any claim by the Employee against the Company under this Agreement or otherwise will not excuse the Employee’s breach of any covenant in Section 6 or 7. The covenants of Sections 6 and 7 shall survive the expiration, termination, extinguishment, or lapse of this Agreement under any circumstances, even if this Agreement is terminated by either party, whether for Cause or Not for Cause.

9. Representations and Warranties by The Employee . The Employee represents and warrants to the Company that the execution and delivery by the Employee of this Agreement do not, and the performance by the Employee of the Employee’s obligations hereunder will not, with or without the giving of notice or the passage of time, or both: (a) violate any judgment, writ, injunction, or order of any court, arbitrator, or governmental agency applicable to the Employee, or (b) conflict with, result in the breach of any provisions of or the termination of, or constitute a default under, any agreement to which the Employee is a party or by which the Employee is or may be bound, including, without limitation, any noncompetition agreement or similar agreement. Employee further represents and warrants that he fully and completely understands this Agreement and that he has engaged in negotiations with the Company and has either consulted with an attorney of his choice or has had ample opportunity to do so and is fully satisfied with the opportunity he has had.

10. Notices . For purposes of this Agreement, notices and all other communications provided for herein shall be in writing and shall be deemed to have been duly given when hand-delivered, sent by facsimile transmission (as long as receipt is acknowledged), or mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed to the address or facsimile number for each party set forth on the signature page hereto, or to such other address or facsimile number as either party may have furnished to the other in writing in accordance herewith, except that a notice of change of address shall be effective only upon receipt.

11. Miscellaneous . No provision of this Agreement may be modified or waived unless such waiver or modification is agreed to in writing signed by both of the parties hereto. No waiver by any party hereto of any breach by any other party hereto shall be deemed a waiver of any similar or dissimilar term or condition at the same or at any prior or subsequent time. This Agreement is the entire agreement between the parties hereto with respect to the Employee's employment by the Company, and there are no agreements or representations, oral or otherwise, expressed or implied, with respect to or related to the employment of the Employee which are not set forth in this Agreement. This Agreement shall be binding upon, and inure to the benefit of, the Company, its respective successors and assigns, and the Employee and Employee’s heirs, executors, administrators and legal representatives. The duties and covenants of the Employee under this Agreement, being personal, may not be delegated or assigned by the Employee without the prior written consent of the Company, and any attempted delegation or assignment without such prior written consent shall be null and void and without legal effect. The parties agree that if any provision of this Agreement shall under any circumstances be deemed invalid or inoperative, the Agreement shall be construed with the invalid or inoperative provision deleted and the rights and obligations of the parties shall be construed and enforced accordingly. This Agreement may be assigned by the Company without the consent of the Employee, provided, however, that the Employee is given notice of the assignment.

12. Governing Law; Resolution of Disputes . The validity, interpretation, construction, and performance of this Agreement shall be governed by the laws of the State of California without regard to principles of choice of law or conflicts of law thereunder. Any action or proceeding seeking to enforce any provision of, or based on any right arising out of, this Agreement may be brought against either of the parties in the courts of the State of California, County of Orange, or, if it has or can acquire jurisdiction, in the federal courts located in, Orange County, California, and each of the parties consents to the jurisdiction of such courts (and of the appropriate appellate courts) in any such action or proceeding and waives any objection to venue laid therein. Process in any action or proceeding referred to in the preceding sentence may be served on either party anywhere in the world. The parties hereto agree that having venue and jurisdiction solely in California is reasonable in that the headquarters for the Company is in Orange County, California and that site for litigation is the most central for such matters. THE PARTIES HEREBY WAIVE A JURY TRIAL IN ANY LITIGATION ARISING UNDER OR RELATING TO THIS AGREEMENT OR THE EMPLOYMENT OF THE EMPLOYEE WITH THE COMPANY. This Agreement shall not be construed against either party but shall be construed without regard to the participation of either party in the drafting of this Agreement or any part thereof.

13. Counterparts; Facsimile Signatures . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be effective upon the execution and delivery by any party hereto of facsimile copies of signature pages hereto duly executed by such party; provided , however , that any party delivering a facsimile signature page covenants and agrees to deliver promptly after the date hereof two (2) original copies to the other party hereto.

14. Modification By The Court . In the event that any provision or Section of this Agreement violates any law of the state of California or is for some other reason unenforceable as written in the state of California, the Employee and the Company agree that the unenforceable provision or Section should not cause the entire Agreement to become unenforceable unless it is caused to fail in its essential purpose. In the event that any provision or Section of this Agreement violates any law of the state of California or is for some other reason unenforceable as written in the state of California, the Employee agrees that the provision should be reduced in scope or length or otherwise modified by the Court, if possible under the law, to cause the provision or Section of the Agreement to be legal and enforceable but to still provide to the Company the maximum protection available to it under the law.

[signature(s) on following page]

IN WITNESS WHEREOF , the parties have executed this Agreement as of the day and year first above written.

	LIQUIDMETAL TECHNOLOGIES, INC.


	By:	/s/ Abdi Mahamedi
		Abdi Mahamedi, Chairman

	Liquidmetal Technologies
	30452 Esperanza
	Rancho Santa Margarita, CA
	92688
	Facsimile Number: 949.635.2108

	EMPLOYEE


	By:	/s/ Thomas Steipp

	Printed Name:	Thomas Steipp

	Address and Facsimile Number:

EXHIBIT A

Section 2870 of the California Labor Code provides:

(a) Any provision in an employment agreement which provides that an employee shall assign or offer to assign any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer's equipment, supplies, facilities, or trade secret information except for those inventions that either: (1) Relate at the time of conception or reduction to practice of the invention to the employer's business, or actual or demonstrably anticipated research or development of the employer; (2) Result from any work performed by the employee for the employer.

(b) To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable.

Patent	Country	Date Filed	Serial No.	Patent No./Status	Issue Date
Metal Frame	USA	06.07.02	10/165,466	6’771’490	08.03.04
Metal Frame	UK	06.07.02	02787184.7	1404884	07.11.07
Metal Frame	Germany	06.07.02	60221127.1	60221127	07.11.07
Metal Frame	China	06.07.02	028138414	ZL02813841.4	03.01.06
Metal Frame	Korea	06.07.02	2003- 7016092	10-0908420	07.13.09
Metal Frame	India	06.07.02	2091DELNP 2003	Filed	—
Joining by Casting	USA	07.31.02	10/210,398	6’818’078	11.16.04
Joining by Casting	UK	07.31.02	02761216.7	1415010	01.07.09
Joining by Casting	Germany	07.31.02	02761216.7	60230769.4	01.07.09
Joining by Casting	Italy	07.31.02	48253BE200 9	1415010	01.07.09
Joining by Casting	Japan	07.31.02	2003- 517329	4243589	12.19.08
Joining by Casting	Korea	07.31.02	2004- 7001265	0898657	05.13.09
Gliding Boards	USA	03.07.02	10/093,229	6’843’496	01.18.05
Gliding Boards	Japan	03.07.02	2002- 570783	4216604	11.14.08
Gliding Boards	EPO	03.07.02	0270796722 122	Filed	—
Forming Molded Articles	USA	09.06.02	10/236,792	6’875’293	04.05.05
Forming Molded Articles	China	09.06.02	028198131	ZL02819813.1	01.17.07
Forming Molded Articles	EPO	09.06.02	027802842	Filed	—
Forming Molded Articles	Japan	09.06.02	2003527141	Filed	—
Forming Molded Articles	Korea	09.06.02	2004700338 8	Filed	—
Cutting Tools	USA	03.07.02	10/093,245	6’887’586	05.03.05
Cutting Tools	Japan	03.03,09	2009- 049448	Filed	—

Patent	Country	Date Filed	Serial No.	Patent No./Status	Issue Date
Cutting Tools	China	03.07.02	028080815	ZL02808081.5	04.23.08
Cutting Tools	Korea	03.07.02	2003- 7011684	100874694	12.11.08
Improving Bulk Alloys	USA	10.02.02	10/263,965	7’008’490	03.07.06
Improving Bulk Alloys	Japan	10.02.02	2003532717	Filed	—
Improving Bulk Alloys	Korea	10.02.02	2004700498 8	Filed	—
Improving Bulk Alloys	China	10.02.02	0282185915	Filed	—
Thermoplastic Casting (TPC)	USA	01.31.03	10/355,490	7’017’645	03.28.06
Thermoplastic Casting (TPC)	EPO	01.31.03	0373510951 215	EP1499461	09.02.09
Thermoplastic Casting (TPC)	UK	01.31.03	03735109,5 1215	Filed	—
Thermoplastic Casting (TPC)	Germany	01.31.03	03735109.5- 1215	Filed	—
Thermoplastic Casting (TPC)	France	01.31.03	03735109.5- 1215	Filed	—
Thermoplastic Casting (TPC)	China	01.31.03	038043971	ZL03804397.1	11.02.07
Thermoplastic Casting (TPC)	Japan	01.31.03	20106769	Filed	—
Thermoplastic Casting (TPC)	Korea	01.31.03	2004701190 0	Filed	—
Foamed Structures	USA	05.20.03	10/442,707	7’073’560	07.11.06
Foamed Structures	UK	05.20.03	03729048.3 2122	1513637	05.12.08
Foamed Structures	Germany	05.20.03	037290483	60319700.0-.08	03.12.08
Foamed Structures	Korea	05.20.03	2004701877 3	Filed	—
Encapsulated Ceramic Armor	USA	03.11.03	10/386,728	7,157,158	01.02.07

Patent	Country	Date Filed	Serial No.	Patent No./Status	Issue Date
Investment Casting of Bulk-Solidifying Amorphous Alloys	USA	09.30.03	10/529,585	7’293’599	11.13.07
Retractable Memory Stick	USA	08.21.06	29/264,947	D563,954	03.11.08
Golf Club Made of Bulk-Solidifying Amorphous Metal	USA	11.25.05	11/288,492	7’357’731	04.15.08
Jewelry Made of Precious Amorphous Alloys and Method of Making Such	USA	10.05.05	10/534,375	7,412,848	08/19/08
Amorphous Alloy Stents	USA	11.18.03	10/534,374	7,500,987	03/10/09
Method of Making In-Situ Composites Comprising Amorphous Alloys	USA	02.11.04	10/545,123	7,520,944	03/21/09
Method of Making Dense Composites of Bulk-Solidifying Alloys and Articles Thereof	USA	06.17.03	10/521,424	7,560,001	7/14/2009
Continuous Casting of Bulk Solidifying Amorphous Alloys	USA	04.14.04	10/552,667	7,575,040	8/18/2009
Pt-Base Bulk Solidifying Amorphous Alloys	USA	12.22.03	10/540,337	7,582,172	9/1/2009
Continuous Casting of Foamed Bulk Amorphous Alloys	USA	04.14.04	10/552,496	7,588,071	9/15/2009
Continuous Casting of Foamed Bulk Amorphous Alloys	Korea	04.14.04	2005- 7019638	Filed	—
Encapsulated Ceramic Armour	USA	12.18.06	11/612,328	7,604,876	10/20/2009
Method of Manufacturing Amorphous Metallic Foam	USA	01.20.04	10/542,438	7,621,314	11/24/2009
Fe-Base In-Situ Composite Alloys Comprising Amorphous Phase	USA	10.01.04	10/573,148	7,618,499	11/17/2009

Patent	Country	Date Filed	Serial No.	Patent No./Status	Issue Date
Antenna Structures Made of Bulk-Solidifying Amorphous Alloys	USA	02.17.06	11,844431	Filed	—
Antenna Structures Made of Bulk	UK	02.17.06	07171812	2439852	06/10/2009
Antenna Structures Made of Bulk	China	02.17.06	2006- 800088016	Filed	—
Antenna Structures Made of Bulk	India	02.17.06	6490DELM P2007	Filed	—
Bulk-Solidifying Alloys with Improved Mechanical Properties	USA	12.16.05	11,303,844	Filed	—
High Durability Structures of Amorphous Alloy with a Method of Forming	USA	08.13.04	10,565,839	Filed	—
Medical Implants	USA	08.19.03	10,524,954	Filed	—
Medical Implants	EPO	08.19.03	03788672.8	Filed	—
Metallic Dental Prostheses Made of Bulk-Solidifying Amorphous Alloys and Articles Thereof	USA	08.05.03	10,523,465	Filed	—
Au-Base Bulk Solidifying Amorphous Alloys	USA	10.17.05	11,576,922	Filed	—
Au-Base Amorphous Alloys	EPO	10.17.05	05815431.1	1 805 337	05.05.10
Au-Base Amorphous Alloys	UK	10.17.05	05815431.1	Filed	—
Au-Base Amorphous Alloys	Germany	10.17.05	05815431.1	60- 2005021136.5	—
Au-Base Amorphous Alloys	France	10.17.05	05815431.1	Filed	—
Au-Base Amorphous Alloys	Switzerland	10.17.05	05815431.1	Filed	—
Au-Base Amorphous Alloys	Netherlands	10.17.05	05815431.1	Filed	—
Au-Base Amorphous Alloys	Austria	10.17.05	05815431.1	Filed	—

Patent	Country	Date Filed	Serial No.	Patent No./Status	Issue Date
All-Base Amorphous Alloys	Spain	10.17.05	05815431.1	Filed	—
Au-Base Amorphous Alloys	Turkey	10.17.05	05815431.1	Filed	—
Current Collector Plates Made of Bulk-Solidifying Amorphous Alloys	USA	03.18.04	10,548,979	Filed	—
Current Collector Plates Made of Bulk-Solidifying Amorphous Alloys	Japan	10.18.04	2006- 507442	Filed	—
Amorphous Alloy Hooks and Methods of Making Such Hooks	USA	10.24.05	11,577,081	Filed	—
Metallic Mirrors Formed from Amorphous Alloys	USA	10.19.05	11,577,052	Filed	—
Tin-Addition to Amorphous Alloy	USA	06.12.09	61,354,620	Filed	—
Tin-Addition to Amorphous Alloy	Korea	07.23.09	200910- 2009- 0067226	Filed	—
Amorphous Alloy Armor	USA	11.09.09	12,615,097	Filed	—
Hermetic Seal	USA	01.04.10	61,335,294	Filed	—
Nickel Based Thermal Spray Powder Imprint Lithograph with Amorphous Metallic Materials	USA	02.01.10	61,300,381	Filed	—
Thermoplastic Forming Methods for Amorphous Alloys	USA	02.17.10	61,338,138	Filed	—
Ni-Free Beryllium Containing Amorphous Alloy	USA	04.28.10	61,329,054	Filed	—
Molybdenum-Containing Ferrous Alloy for Improved Thermal Spray Deposition and Hard Facing	USA	03.19.10	61,315,661	Filed	—

SCHEDULE 1 TO AGREEMENT (CONTINUED)

Trademarks and Trademark Applications

Ref No.	Mark/ Title	App. No./ Filing Date	Reg No./ Issue Date	Status	Inventors/Goods	U.S./ Foreign
LQUID-002T	LIQUIDMETAL (and design)	75/389,648 11/13/1997	2,435,529 03/13/2001	REGISTERED RENEWAL DUE 03/13/2011	CLASS 028: GOLF EQUIPMENT, NAMELY, GOLF CLUBS, GOLF BALLS AND GOLF BAGS	U
LQUID-003T	LIQUIDMETAL (stylized)	75/389,645 11/13/1997	2,480,241 08/21/2001	REGISTERED RENEWAL DUE 08/21/2011	CLASS 028: GOLF EQUIPMENT, NAMELY, GOLF CLUBS, GOLF BALLS AND GOLF BAGS	U
LQUID-004T	LIQUIDMETAL (and design)	75/358,134 09/16/1997	2,312,889 02/01/2000	REGISTERED RENEWAL DUE 02/01/2020	CLASS 006: AMORPHOUS METALS	U
LQUID-005T	LIQUIDMETAL GOLF (and design)	75/351,059 09/03/1997	2,494,583 11/02/2001	REGISTERED RENEWAL DUE 10/02/2011	CLASS 028: TOYS AND SPORTING GOODS, NAMELY, GOLF CLUBS, GOLF BALLS, GOLF CLUB SHAFTS, GOLF GRIPS, GOLF BAGS, TENNIS RACKETS	U
LQUID-008T	LIQUIDMETAL GOLF	75/498,778 06/08/98	2,714,787 05/13/2003	REGISTERED RENEWAL DUE 05/13/2013	CLASS 025: CLOTHING, NAMELY, HATS, PANTS, SHIRTS, SHORTS, SWEATERS, JACKETS AND FOOTWEAR	U
LQUID-013JP (Japan)	LIQUIDMETAL (and design)	016900/1997 02/18/1997	4149191 05/22/1998	REGISTERED RENEWAL DUE 05/22/2018	CLASS 006: AMORPHOUS METALS	F
LQUID-013KS (South Korea)	LIQUIDMETAL (and design)	97-57058 12/10/1997	447777 05/13/1999	REGISTERED RENEWAL DUE 05/13/2019	CLASS 006: ZIRCONIUM AND TITANIUM BASED ALLOYS	F
LQUID-014HK2 (Hong Kong)	LIQUIDMETAL (and design)	793/2001 01/15/2001	B6279/2002 05/24/2002	REGISTERED RENEWAL DUE 01/15/2018	CLASS 028: GAMES AND PLAYTHINGS, GYMNASTIC AND SPORTING ARTICLES	F
LQUID-014JP (Japan)	LIQUIDMETAL (and design)	147446/1997 08/07/1997	4496160 08/03/2001	REGISTERED RENEWAL DUE 08/03/2011	CLASS 028: SPORTING, ATHLETIC AND GYMNASTIC IMPLEMENTS; GAME MACHINES AND APPARATUS; GO GAME EQUIPMENT (JAPANESE BOARD GAME); SHOGI GAME EQUIPMENT (JAPANESE CHESS); DICE; SUGOROKU GAMES (JAPANESE PARCHEESI); DICE CUPS; DIAMOND GAMES; CHESS GAMES; CHECKERS; CONJURING APPARATUS; DOMINOES; MAHJONG EQUIPMENT; BILLIARD APPARATUS; TOYS; DOLLS; TOYS FOR DOMESTIC PETS; WAX FOR SKIS; FISHING TACKLE	F
LQUID-014KS (South Korea)	LIQUIDMETAL (and design)	97-57059 12/10/1997	446249 04/14/1999	REGISTERED RENEWAL DUE 04/14/2019	CLASS 028; GOLF CLUBS, GOLF BALLS AND GOLF BAGS	F
LQUID-014SG (Singapore)	LIQUIDMETAL (and design)	S115181/97 12/15/1997	T97/15181Z 12/15/1997	REGISTERED RENEWAL DUE 12/15/2017	CLASS 028: SPORTING GOODS	F

LQUID-014TI (Taiwan)	LIQUIDMETAL (and design)	75/184,482 10/21/1996	854224 06/01/1999	REGISTERED RENEWAL DUE 05/31/2019	CLASS 028: SPORTING GOODS, NAMELY BADMINTON RACKETS, GOLF CLUB HEADS, GOLF CLUB SHAFTS, GOLF CLUBS, GOLF CLUB FACE PLATE INSERTS, FIELD HOCKEY STICKS, ICE HOCKEY STICKS AND TENNIS RACKETS	F
LQUID-015AU (Australia)	LIQUIDMETAL (and design)	750504 12/08/1997	750504 02/11/2000	REGISTERED RENEWAL DUE 12/08/2017	CLASS 028; SPORTING GOODS	F
LQUID-015CA (Canada)	LIQUIDMETAL (and design)	864571 12/18/1997	517,008 09/24/1999	REGISTERED RENEWAL DUE 09/24/2014	CLASS 006: AMORPHOUS METALS CLASS 028: SPORTING GOODS, NAMELY GOLF CLUBS, GOLF BALLS AND GOLF BAGS	F
LQUID-015EU (Europe)	LIQUIDMETAL (and design)	698977 12/08/1997	000698977 09/01/1999	REGISTERED RENEWAL DUE 12/08/2017	CLASS 006: AMORPHOUS METALS CLASS 028: SPORTING GOODS	F
LQUID-018JP (Japan)	LIQUIDMETAL (and design)	016901/1997 02/18/1997	4149192 05/22/1998	REGISTERED RENEWAL DUE 05/22/2018	CLASS 006: AMORPHOUS METALS	F
LQUID-019JP (Japan)	LIQUIDMETAL GOLF (and design)	0167209/1997 10/13/1997	4314788 09/10/1999	REGISTERED RENEWAL DUE 09/10/2019	CLASS 028: TOYS; SPORTING, ATHLETIC AND GYMNASTIC IMPLEMENTS	F
LQUID-020JP (Japan)	LIQUIDMETAL (shaded letters)	147447/1997 08/07/1997	4470501 04/27/2001	REGISTERED RENEWAL DUE 04/27/2011	CLASS 028: SPORTING, ATHLETIC AND GYMNASTIC IMPLEMENTS; GAME MACHINES AND APPARATUS; GO GAME EQUIPMENT (JAPANESE BOARD GAME); SHOGI GAME EQUIPMENT (JAPANESE CHESS); DICE; SUGOROKU GAMES (JAPANESE PARCHEESI); DICE CUPS; DIAMOND GAMES; CHESS GAMES; CHECKERS; CONJURING APPARATUS; DOMINOES; MAHJONG EQUIPMENT; BILLIARD APPARATUS; TOYS; DOLLS; TOYS FOR DOMESTIC PETS; WAX FOR SKIS; FISHING TACKLE	F
LQUID-027T	LIQUIDMETAL	75/434,845 02/17/1998	2,435,558 03/13/2001	REGISTERED RENEWAL DUE 03/13/2011	GLASS 028: GOLF PRODUCTS, NAMELY GOLF CLUBS, GOLF BALLS AND GOLF BAGS	U
LQUID-051U	LIQUIDMETAL		107559 08/03/2001	CA REGISTERED RENEWAL DUE 08/23/2011	GOLF EQUIPMENT; GOLF PRODUCTS; GOLF CLUBS; TOYS AND SPORTING GOODS	U
LQUID-057AU (Australia)	LIQUIDMETAL	946649 03/11/2003	946649 12/07/2006	REGISTERED RENEWAL DUE 03/11/2013	CLASS 028: SPORTING GOODS, NAMELY TENNIS RACKETS, SKIS, SKI POLES AND SNOW BOARDS	F
LQUID-057CA (Canada)	LIQUIDMETAL	1,186,331 08/012003	666,056 06/14/2006	REGISTERED RENEWAL DUE 06/14/2021	CLASS 006: AMORPHOUS METALS CLASS 025: WEARING APPAREL, NAMELY SHIRTS, T-SHIRTS, SHORTS, PANTS, SWEATSHIRTS, SWEATPANTS, HATS, VISORS, SHOES AND BELTS CLASS 028: SPORTING GOODS NAMELY SPORTING KNIVES, TENNIS RACKETS, TENNIS BAGS AND TENNIS CASES, GOLF CLUBS, GOLF BALLS AND GOLF BAGS	F

LQUID-057EU (Europe)	LIQUIDMETAL	003091501 03/11/2003	003091501 05/31/2005	REGISTERED RENEWAL DUE 03/11/2013	CLASS 008: SPORTING KNIVES CLASS 025: WEARING APPAREL, INCLUDING SHIRTS, T-SHIRTS, SHORTS, PANTS, SWEATSHIRTS, SWEATPANTS, HATS, VISORS, SHOES AND BELTS CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS; AND MATERIALS USED IN SKIS, SKI POLES AND SNOW BOARDS	F
LQUID-057HK (Hong Kong)	LIQUIDMETAL	300057717 08/24/2004		REGISTERED RENEWAL DUE 08/04/2013	CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS, SKIS, SKI POLES, SNOWBOARDS, TENNIS BAGS, TENNIS CASES, GOLF CLUBS, GOLF BALLS AND GOLF BAGS	F
LQUID-057HU (Hungary)	LIQUIDMETAL	M 03 03314	183038 12/13/2005	REGISTERED RENEWAL DUE 08/05/2013	CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS, TENNIS BAGS, TENNIS CASES, SPORTING KNIVES, AND MATERIALS USED IN SKIS, SKI POLES AND SNOWBOARDS	F
LQUID-057PL (Poland)	LIQUIDMETAL	Z-268178 08/04/2003	176076 06/27/2006	REGISTERED RENEWAL DUE 08/04/2013	CLASS 028: SPORTING GOODS, TENNIS RACKETS, SKIS, SKI POLES, SNOWBOARDS, SPORTING KNIVES, TENNIS BAGS, TENNIS CASES, GOLF CLUBS, GOLF BALLS AND GOLF BAGS	F
LQUID-057MX (Mexico)	LIQUIDMETAL	613402 08/06/2003	843878 07/22/2004	REGISTERED RENEWAL DUE 08/06/2013	CLASS 028: SPORTING GOODS, TENNIS RACKETS, SKIS, SKI POLES, SNOWBOARDS, SPORTING KNIVES, TENNIS BAGS, TENNIS CASES, GOLF CLUBS, GOLF BALLS AND GOLF BAGS	F
LQUID-057RC2 (China)	LIQUIDMETAL	6079477 05/30/2007		PENDING APPLICATION REJECTED; FILED RESPONSE IN 08/2009; TAKES APPROX. 18 MONTHS TO GET DECISION	CLASS 6: AMORPHOUS METALS, METAL CASTINGS AND METAL HINGES FOR CELLULAR PHONES	F

LQUID-057RC3 (China)	LIQUIDMETAL	6079478 05/30/2007		PENDING APPLICATION REJECTED; FILED RESPONSE IN 08/2009; TAKES APPROX. 18 MONTHS TO GET DECISION	CLASS 9: CELLULAR TELEPHONES, PERSONAL DATA ASSISTANTS, MP3 PLAYERS, COMPUTER MEMORY HARDWARE, PERSONAL DIGITAL ASSISTANTS, PORTABLE LISTENING DEVICES, CAMCORDERS, CINEMATOGRAPHIC CAMERAS, PHOTOGRAPHIC CAMERAS, COMPACT DISC PLAYERS, COMPUTERS, PRINTERS FOR USE WITH COMPUTERS, MAGNETIC DISKS, GAUGES, LOUDSPEAKERS, MEASURING INSTRUMENTS, PORTABLE TELEPHONES, PROTECTIVE HELMETS, PROTECTIVE HELMETS FOR SPORTS, RADIOS, VEHICLE RADIOS, AUDIO AND VIDEO RECEIVERS, SOUND RECORDING APPARATUS, SPECTACLE FRAMES, SPECTACLES/OPTICS, PERSONAL STEREOS, SUNGLASSES, TELEPHONE APPARATUS, BULLET-PROOF VESTS, VIDEO TELEPHONES, WORKMAN’S PROTECTIVE FACE-SHIELDS, AND PROTECTION DEVICES AGAINST X-RAYS.	F
LQUID-057RU (Russia)	LIQUIDMETAL	2003715095 08/05/2003	297443 10/31/2005	REGISTERED RENEWAL DUE 08/05/2013	CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS, SKIS, SKI POLES, SNOWBOARDS, SPORTING KNIVES, TENNIS BAGS AND TENNIS CASES	F
LQUID-057T	LIQUIDMETAL	78/224,925 03/12/2003	3,159,720 10/17/2006	REGISTERED 8 & 15 DECL. DUE 10/17/2012	CLASS 008: SPORTING KNIVES CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS; AND MATERIALS USED IN SKIS, SKI POLES AND SNOW BOARDS	U
LQUID-058T	LIQUIDMETAL (stylized)	78/225,717 03/14/2003	3,230,417 04/17/2007	REGISTERED 8 & 15 DECL. DUE 04/17/2013	CLASS 008: SPORTING KNIVES CLASS 025: WEARING APPAREL, NAMELY, SHIRTS, T-SHIRTS, SHORTS, PANTS, SWEATSHIRTS, SWEATPANTS, HATS, VISORS, SHOES AND BELTS CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS; AND MATERIALS USED IN SKIS, SKI POLES AND SNOW BOARDS	U
LQUID-059T	PURE ENERGY, PERFECT POWER	78/224,935 03/12/2003	2,955,613 05/24/2005	REGISTERED 8 & 15 DECL. DUE 05/24/2011	CLASS 028: SPORTING GOODS, NAMELY TENNIS RACKETS, SKIS, SKI POLES AND SNOW BOARDS	U

LQUID-064T	LIQUIDMETAL			NOT FILED AWAITING CLIENT INSTRUCTIONS	CLASS 025: CLOTHING FOR MEN; WOMEN; JUNIORS; AND CHILDREN, NAMELY SHIRTS, INCLUDING T-SHIRTS; POLO SHIRTS; CASUAL; DRESS; TOPS, BLOUSES; HALTER TOPS; TANK TOPS, SWEATERS, PANTS; INCLUDING CASUAL; SLACKS; AND JEANS, SUITS, DRESSES, INCLUDING CASUAL AND EVENING GOWNS, SKIRTS, COATS AND JACKETS, INCLUDING BLAZERS, UNIFORMS, SLEEPWEAR, INCLUDING PAJAMAS AND NIGHTGOWNS, ROBES, BEACHWEAR AND SWIMWEAR, INCLUDING BATHING SUITS; SWIM TRUNKS; BIKINIS; AND WRAPS, HATS, LOUNGEWEAR, INCLUDING SWEATS; SWEATSHIRTS AND THE LIKE; UNDERWEAR; INCLUDING BOXERS; BRIEFS, PANTIES AND THE LIKE.	U
LQUID-067T	LIQUIDMETAL	78/507,702 18/28/2004	3,610,314 04/21/2009	REGISTERED 8 & 15 DECL. DUE 04/21/2015	CLASS 006: METAL CASTINGS AND METAL HINGES FOR CELLULAR PHONES CLASS 014: JEWELRY	U
LQUID-069T	LIQUIDMETAL (stylized)	78/911,296 06/19/2006	3,633,282 06/02/2009	REGISTERED 8 & 15 DECL. DUE 06/02/2015	CLASS 009: CELLULAR TELEPHONES, PERSONAL DATA ASSISTANTS, MPS PLAYERS, AND COMPUTER MEMORY HARDWARE CLASS 014: WATCHES	U
LQUID-070EU (Europe)	LIQUIDMETAL	005157359 06/23/2006	005157359 08/29/2007	REGISTERED RENEWAL DUE: 06/23/2016	CLASS 009: PERSONAL DIGITAL ASSISTANTS, PORTABLE LISTENING DEVICES, CAMCORDERS, CINEMATOGRAPHIC CAMERAS, PHOTOGRAPHIC CAMERAS, COMPACT DISC PLAYERS, COMPUTERS, PRINTERS FOR USE WITH COMPUTERS, MAGNETIC DISKS, GAUGES, LOUDSPEAKERS, MEASURING INSTRUMENTS, PORTABLE TELEPHONES, PROTECTIVE HELMETS, PROTECTIVE HELMETS FOR SPORTS, RADIOS, VEHICLE RADIOS, AUDIO AND VIDEO RECEIVERS, SOUND RECORDING APPARATUS, SPECTACLE FRAMES, SPECTACLES/OPTICS, PERSONAL STEREOS, SUNGLASSES, TELEPHONE APPARATUS, BULLET-PROOF VESTS, VIDEO TELEPHONES, WORKMAN’S PROTECTIVE FACE-SHIELDS, AND PROTECTION DEVICES AGAINST X-RAYS CLASS 010: MEDICAL DEVICES, NAMELY, HIP JOINT ORTHOPEDIC IMPLANTS AND KNEE BRACES; DENTAL INSTRUMENTS, NAMELY, PICKS, BURRS AND MIRRORS. CLASS 014: WATCHES, CLOCKS AND JEWELRY	F

LQUID-070HK (Hong Kong)	LIQUIDMETAL	301217330 10/09/2008		PENDING APPLICATION PUBLISHED; AWAITING CERTIFICATE OF REGISTRATION	CLASS 14: WATCHES, CLOCKS AND JEWELRY	F
LQUID-070JP (Japan)	LIQUIDMETAL	2008-84917 10/20/2008	5233668 05/22/2009	REGISTERED RENEWAL DUE: 0/22/2019	CLASS 14: WATCHES, CLOCKS AND JEWELRY	F

4.3 Licensor acknowledges that any breach of this Agreement by it may cause irreparable harm to Licensee and that the remedies for breach may include injunctive relief against such breach, in addition to damages and other available remedies. The prevailing party shall be entitled to the award of its reasonable attorneys’ fees in any action to enforce this Agreement.

4.4 This Agreement, including any recitals, terms, conditions, and provisions herein, and all exhibits attached hereto and referenced herein, constitutes the entire agreement between the parties relating to the subject matter hereof and supersedes and cancels all other prior agreements and understandings of the parties in connection with subject matter. The headings or titles in this Agreement are for purposes of reference only and shall not in any way affect the interpretation or construction of this Agreement.

4.5 No waiver of any of the provisions of this Agreement shall be valid unless in a written document, signed by the party against whom such a waiver is sought to be enforced, nor shall failure to enforce any right hereunder constitute a continuing waiver of the same or a waiver of any other right hereunder. All amendments of this Agreement shall be made in writing, approved by Apple and signed by both parties, and no oral amendment or amendment made without the approval of Apple shall be binding on the parties. Apple shall be a third-party beneficiary to this provision.

4.6 This Agreement shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict of laws principles to the contrary. If any provision of this Agreement is held to be invalid or unenforceable to any extent in any context, it shall nevertheless be enforced to the fullest extent allowed by law in that and other contexts, and the validity and force of the remainder of this Agreement shall not be affected thereby.

4.7 Without affecting the obligations of the parties otherwise expressed, the term “shall” when used in this Agreement in connection with any act or obligation to be undertaken means an affirmative obligation. The term “including” shall mean “including but not limited to.” All terms shall be construed in the masculine or feminine and in plural or singular as required by the context in which the term is used. The definitions of terms in this Agreement are limited to this Agreement.

[Signatures follow]

- 5 -

IN WITNESS WHEREOF, each of the parties has executed this Agreement as of the date first written above. Each of the persons signing this Agreement affirms that he or she is duly authorized to do so and thereby to bind the indicated entity. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

CRUCIBLE INTELLECTUAL PROPERTY, LLC:		LIQUIDMETAL COATINGS, LLC:

By:	/s/ Tony Chung	By:	/s/ Larry Buffington
Name:	Tony Chung	Name:	LARRY BUFFINGTON
Title:	Chief Financial Officer	Title:	PRESIDENT/CEO

Address: 31441 Santa Margarita Pkwy.		Address: 900 Rockmead, Suite 240,
Suite A #247		Kingwood, TX 77339
Rancho Santa Margarita, CA 92688		Attn: Chief Executive Officer
Attn: Chief Executive Officer

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ANNEX 9

Technology Development Agreement

APPLE CONFIDENTIAL

APPLE – LMT TECHNOLOGY DEVELOPMENT AGREEMENT

This Technology Development Agreement (the “Agreement”) is made effective as of the Closing Date, as defined in the Master Transaction Agreement, by and between Apple Inc., a California corporation having its principal place of business at 1 Infinite Loop, Cupertino, California 95014, United States (“Apple”), and Liquidmetals Technology, Inc. (“LMT”), a Delaware corporation having its principal place of business at 30452 Esperanza, Rancho Santa Margarita, CA 92688 (“Company”). This Agreement is being entered into pursuant to that certain Master Transaction Agreement of even date herewith between the parties hereto (the “MTA”), and any capitalized terms not otherwise defined in this Agreement shall have the meanings ascribed thereto in the MTA.

1)	Scope and Standards of Work .

Company shall provide, at no additional cost to Apple, technical assistance reasonably requested by Apple to effect i) the transfer by LMT of the non-patent LMT Technology and ii) the granting of the Exclusive License and License by LMT-SPE to Apple, for a 90-day period following the Closing Date (“the Initial Support Period”). Such technical assistance will be provided with LMT’s existing staff and resources, and LMT will not be required to hire or engage additional personnel in order to provide such technical assistance.

Company shall provide, at no additional cost to Apple, any technology development services specified in Statements of Work under this Agreement, agreed to by Apple and the Company prior to the Closing Date (the “Pre-Closing Statements of Work” or “Pre-Closing SOWs”)

Company shall provide, after the Initial Support Period, technical assistance and consultation to Apple as described in, and in accordance with the time tables set forth in, Statements of Work under this Agreement (the “Post-Closing Statements of Work” or “Post-Closing SOWs”).

The technical assistance defined in (a), the technology development services defined in (b), and technical assistance and consultation defined in (c) shall be referred to collectively as the “Services”. The Pre-Closing SOWs and the Post-Closing SOWs shall be referred to collectively as the “Statements of Work” or “SOWs”.

Company shall conduct all Services in accordance with all applicable Apple and generally accepted standards for Services of the type to be performed, as may be more fully provided in the Statements of Work (the “Applicable Standards”). Company shall at all times be responsible to remain current and updated as to all changes in the Applicable Standards.

APPLE CONFIDENTIAL

Apple may request reasonable changes to the Statement of Works prior to completion. No such proposed changes, including without limitation any associated changes in the price, payment schedules, and projected completion dates, shall be effective unless accepted in writing by authorized representatives of both Company and Apple.

Company warrants that its employees, agents, and approved subcontractors, if any, involved in performance of the Services shall have the experience and expertise necessary to perform such Services and will at all times be bound by appropriate agreements to vest in Company all of their right, title and interest in any Project Work Product (as defined below) or inventions, data, improvements, discoveries, ideas, processes, formulas, techniques, works of authorship, and know-how that are to be property of Apple or otherwise protected pursuant to Sections 3, 5 and 6 below.

Company represents and warrants that Company is not under any obligation in conflict or in any way inconsistent with the provisions of this Agreement or its provision of the Services. Company represents and warrants that Company’s performance of the Services and this Agreement will not breach any agreement to keep in confidence proprietary information acquired by Company in confidence or in trust. Company warrants that it shall not, in the performance of any Services or in preparing to do so, violate any applicable law or infringe or misappropriate any intellectual properties of any third party, except to the extent due directly to Company’s following instructions given to it by Apple.

Company agrees to notify Apple promptly if Company knows or has reason to believe that the Statements of Work or any instructions from Apple would, if followed by Company, violate any applicable law or infringe or misappropriate any intellectual properties of any third party or be inconsistent with the Applicable Standards.

Apple Materials . Apple shall provide items and materials as specified in the SOWs (the “Project Materials”). Company agrees that all such Project Material shall be and remain the sole and exclusive property of Apple. Project Material provided by Apple will be used by Company only for the purpose described in the Statements of Work and will not be transferred to any third party without first obtaining written authorization from Apple in each instance. Company agrees that it shall not, without Apple’s express prior written authorization in each instance, analyze, disassemble, decompile, or otherwise reverse engineer any Apple Materials, except to the extent the Statements of Work explicitly directs Company to do so. Upon completion of the Services, any unused Project Material will be returned to Apple or destroyed at the sole discretion of Apple.

APPLE CONFIDENTIAL

3)	Communication, Visits, Results, and Reports .

All results, reports, findings, conclusions, work papers, notebooks, electronic records, samples, prototypes, deliverables, and any other information or materials in any form or format arising out of performance of the Services by or for Company (the “Project Work Product ” ) will be the sole property of Apple and shall become part of the Confidential Information to be protected under this Agreement. Company will retain and preserve all Project Work Product in accordance with the Applicable Standards and as set forth in the Statement of Work. No Project Work Product will be destroyed or otherwise disposed of by Company without authorization in writing in advance from Apple in each instance. Company shall, upon Apple’s request from time to time, promptly deliver any and all Project Work Product and any work-in-process to Apple.

Company shall prepare and provide one or more draft and final report(s) at the intervals, and upon completion of the Services, as more fully described in the Statements of Work. All reports shall be formatted and delivered to Apple in accordance with the Statements of Work.

Apple will be solely responsible, at its discretion in accordance with applicable law, for any reporting to appropriate government agencies any Project Work Product generated during performance of the Services.

Company shall permit Apple’s representatives to visit Company facilities during normal working hours and with reasonable frequency to perform quality assurance audits, observe progress of the Services, to discuss the Services with appropriate officials and other personnel of Company, and to inspect records and data relevant to the Services. Facility visits shall also be permitted during the data retention period specified in the Statements of Work.

Compensation for Post-Closing SOWs . Apple will, in accordance with the payment and milestone schedules set forth in the Post-Closing SOWs (the “Fees and Payment Schedule”), and as complete compensation to Company, pay Company the fees set forth in the Fees and Payment Schedule. Company will be reimbursed only for expenses which are expressly provided for in the Fees and Payment Schedule or which have been approved in advance in writing by an authorized Apple representative. Expense reimbursements will be made within forty-five (45) days of receipt of Company’s invoice, provided Company has furnished such documentation for authorized expenses as Apple may reasonably request. Otherwise, and except for the Apple Materials, if any, Company shall supply without separate charge all facilities, utilities, equipment, supplies, personnel, information, rights, and other items required for the timely performance by Company of the Services.

Confidentiality . The disclosure and use of all confidential information pursuant to this Agreement, including, but not limited to, this Agreement, the Project Materials, any technical information provided by the Company, and all Project Work Product, shall be subject to the terms of the Parties’ existing Confidentiality Agreement, dated April 30, 2010, the terms of which are incorporated by reference herein.

APPLE CONFIDENTIAL

6)	Intellectual Properties.

No right or license to Apple’s intellectual property is granted or implied as a result of this Agreement or the Services, except to the limited extent necessary to conduct the Services during the term hereof. The transfer of Project Material provided herein does not constitute a public disclosure.

All right, title and interest in all Project Work Product and any and all inventions, data, improvements, discoveries, ideas, processes, formulas, techniques, works of authorship, and know-how, whether patentable or not, conceived, reduced to practice, authored, or otherwise created or developed by or for Company in the course of performing any Services or otherwise arising therefrom, and all intellectual property covering such inventions including without limitation rights to patents, patent applications, patents, and copyrights (“Project IP”), shall be the property of Apple, and Company hereby transfers and assigns the same to Apple. Company shall communicate to Apple any of the same promptly and fully upon their creation or development. Company shall execute all papers and take all actions that Apple reasonably deems necessary or advisable for the filing and prosecution of patent applications or copyright or other registrations and, if appropriate, maintenance of patents or other rights or properties that may issue therefrom, including without limitation execution of any assignments or other agreements further evidencing Apple’s ownership thereof. Inventorship shall be determined under principles of U.S. patent law and practice. If Company uses in the Services or incorporates or causes to be incorporated into any Project Work Product any inventions, works of authorship, developments, improvements, data, materials, or trade secrets owned or controlled by Company, or to the extent that any inventions, works of authorship, developments, improvements, data, materials, or trade secrets owned or controlled by Company are required for any use or exploitation by Apple of the Project Work Product, Company hereby grants to Apple a nonexclusive, royalty-free, irrevocable, perpetual, worldwide license, with the right to grant sublicenses, to make, have made, copy, modify, make derivative works of, display, perform, publish, use, sell, offer for sale, import and otherwise exploit such inventions, works of authorship, developments, improvements, data, materials, and trade secrets in connection with the Project Work Product or any improvements, derivatives, or successors to them.

Apple hereby grants to Company a nonexclusive, royalty-free, irrevocable, perpetual, worldwide license under the Project Work Product and Project IP, with the right to grant sublicenses, to make, have made, copy, modify, make derivative works of, display, perform, publish, use, sell, offer for sale, import and otherwise exploit such inventions, works of authorship, developments, improvements, data, materials, and trade secrets in connection with the Project Work Product or Project IP, or any improvements, derivatives, or successors to them, solely for use outside of Apple’s exclusive license field of Consumer Electronic Products.

APPLE CONFIDENTIAL

7)	Indemnification . Company shall defend, indemnify and hold Apple harmless in accordance with the provisions of the MTA.

Term and Termination . This Agreement shall have a term of three (3) y ears from the Closing Date. This Agreement may be renewed, at Apple’s sole option, for successive one-year terms. Apple may at any time terminate this Agreement upon written notice to Company. In event of termination by Apple following initiation of substantial work by Company under the Post-Closing Statements of Work, the amounts payable to Company will be prorated based on actual work performed and costs incurred prior to the date of Apple’s notice of termination, plus any unavoidable costs associated with termination of the Services, all such costs to be detailed in a final invoice delivered to Apple within sixty (60) days after termination of the Agreement. In no event shall any such post-termination payment exceed the next installment of the fees and expenses provided for in the Fees and Payment Schedule. Upon termination Company shall return to Apple all Apple Materials in its possession, together with completed or partially completed reports, data and samples, except for copies maintained for archival purposes to the extent permitted under the Statements of Work. The provisions of Sections 1(d), 1(e), 1(f), 1(g), 2, 3(a), 4, 5, 6, 7, 8, 9 and 10 of this Agreement shall survive the expiration or termination of this Agreement.

9)	Miscellaneous .

All notices from one party to the other required or permitted under this Agreement shall be in writing, shall refer specifically to this Agreement, and shall be delivered in person, or sent by electronic or facsimile transmission for which a confirmation of delivery is obtained, or sent by registered mail or express courier services providing evidence of delivery, in each case to the recipient party’s respective address set forth on the signature page hereof (or to such updated address as may be specified in writing to the other party from time to time). Such notices will be deemed effective as of the date so delivered or on the third business day following mailing.

Apple has entered into this Agreement based on Company’s particular proffered expertise. Company shall not assign, transfer, subcontract or otherwise delegate any of its obligations under this Agreement without Apple’s prior written consent in each instance. Any attempted assignment, transfer, subcontracting or other delegation without such consent shall be void and shall constitute a breach of this Agreement. Subject to the foregoing, this Agreement shall inure to the benefit of the parties’ successors and assigns.

Company acknowledges that any breach of this Agreement by it may cause irreparable harm to Apple or its affiliates and that the remedies for breach may include injunctive relief against such breach, in addition to damages and other available remedies. The prevailing party shall be entitled to the award of its reasonable attorneys’ fees in any action to enforce this Agreement.

APPLE CONFIDENTIAL

This Agreement, including any SOWs and the Confidentiality Agreement referenced herein, constitutes the entire agreement between the parties relating to the subject matter hereof and supersedes and cancels all other prior agreements and understandings of the parties in connection with subject matter. The headings or titles in this Agreement are for purposes of reference only and shall not in any way affect the interpretation or construction of this Agreement.

No waiver of any of the provisions of this Agreement shall be valid unless in a written document, signed by the party against whom such a waiver is sought to be enforced, nor shall failure to enforce any right hereunder constitute a continuing waiver of the same or a waiver of any other right hereunder. All amendments of this Agreement shall be made in writing and signed by both parties, and no oral amendment shall be binding on the parties.

This Agreement shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict of laws principles to the contrary. The parties hereby consent to jurisdiction and venue in the appropriate state and Federal courts sitting in the Northern District of California in any litigation between them arising out of this Agreement. If any provision of this Agreement is held to be invalid or unenforceable to any extent in any context, it shall nevertheless be enforced to the fullest extent allowed by law in that and other contexts, and the validity and force of the remainder of this Agreement shall not be affected thereby.

In the event of a dispute, either party may commence litigation in the state or federal courts in Santa Clara County, California. The Parties irrevocably submit to the exclusive jurisdiction of those courts and agree that final judgment in any action or proceeding brought in such courts will be conclusive and may be enforced in any other jurisdiction upon final and conclusive judgment (a certified copy of which will be conclusive evidence of the judgment) or in any other manner provided by law. Each party irrevocably waives to the fullest extent permitted by applicable law (i) any objection it may have to the laying of venue in any court referred to above; (ii) any claim that any such action or proceeding has been brought in an inconvenient forum; and (iii) any immunity that it or its assets may have from any suit, execution, attachment (whether provisional or final, in aid of execution, before judgment or otherwise) or other legal process.

Neither Apple nor Company will issue press releases or other publicity regarding the Agreement or its subject matter without the prior written approval of the other

IN WITNESS WHEREOF, the parties have executed this Development Agreement as of the effective date shown above. Each of the persons signing this Agreement affirms that he or she is duly authorized to do so and thereby to bind the indicated entity. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

APPLE CONFIDENTIAL

APPLE:		COMPANY:


By:	/s/ Zadesky	By:	/s/ Tony Chung
Name:	Zadesky	Name:	Tony Chung
Title:	VP Product Design	Title:	Chief Financial Officer
Date:	8/5/10	Date:	8/4/10

Address:	1 Infinite Loop	Address:
	305-IDR
	Cupertino, CA 95014
Attn:		Attn:

ANNEX 10

LMT Security Agreement

SECURITY AGREEMENT

1. Grant of Security Interest. For valuable consideration, the undersigned LIQUIDMETAL TECHNOLOGIES, INC., a Delaware corporation ( “ Debtor ” ), hereby grants and transfers to APPLE INC., a California corporation ( “ Creditor ” ), a security interest in all of the property of Debtor, now existing or hereafter arising, described on Exhibit A attached hereto (collectively, the “ Collateral ” ), subject to and in accordance with the terms of this Agreement.

2. Obligations Secured. The obligations secured hereby are the payment and performance of: (a) all present and future obligations of Debtor to Creditor under the Master Transaction Agreement of even date herewith ( “ MTA ” ) and the “Transaction Documents” (as defined in the MTA) between Debtor and Creditor, as the same may be amended, modified, supplemented or amended and restated from time to time; and (b) all obligations of Debtor and rights of Creditor under this Agreement, as the same may be amended, modified, supplemented or amended and restated from time to time (the “ Obligations ” ). The word “ Obligations ” is used herein in its most comprehensive sense and includes any and all debts, obligations and liabilities of Debtor under the MTA and Transaction Documents, including, without limitation, the obligation to pay damages to Creditor relating to the MTA.

3. Termination. This Agreement and the security interests hereunder will terminate upon the earlier of (a) the payment and performance of all obligations of Debtor to Creditor under the Transaction Documents or (b) the second (2 nd ) anniversary of the date of this Agreement; provided that if an Event of Default under this Agreement or an “Event of Default” under the Security Agreement of even date between Crucible Intellectual Property, LLC and Creditor shall have occurred and be continuing on the second (2 nd ) anniversary of the date of this Agreement, this Agreement shall not terminate until such Event of Default has been cured or waived by Creditor. Upon the termination of this Agreement and the security interests hereunder, Creditor will, upon the written request of Debtor, confirm such termination in writing and file (or grant Debtor in writing authorization to file) any termination statements or lien releases necessary to evidence the termination of this Agreement and the security interests hereunder.

4. Covenants of Debtor.

(a) Debtor, agrees in general: (i) to indemnify Creditor against all losses, claims, demands, liabilities and expenses of every kind caused by property subject hereto; (ii) to permit Creditor to exercise its powers; (iv) to execute and deliver such documents as Creditor deems necessary to create, perfect and continue the security interests contemplated hereby; (v) not to change its name, and as applicable, its chief executive office, its principal residence or the jurisdiction in which it is organized and/or registered without giving Creditor prior written notice thereof; (vi) not to change the places where Debtor keeps any Collateral or Debtor’s records concerning the Collateral and Proceeds without giving Creditor prior written notice of the address to which Debtor is moving same; and (vii) to cooperate with Creditor in perfecting all security interests granted herein and in obtaining such agreements from third parties as Creditor deems necessary, proper or convenient in connection with the preservation, perfection or enforcement of any of its rights hereunder.

(b) If Debtor shall at any time hold or acquire any certificated securities comprising any part of the Collateral, Debtor shall forthwith endorse, assign and deliver the same to Creditor, accompanied by such instruments of transfer or assignment duly executed in blank as Creditor may from time to time specify.

(c) If and when Debtor shall obtain rights to any (i) patents or patent applications; (ii) copyright registrations or copyright registration applications; (iii) mask works or mask work registration applications; (iv) trademark registrations or trademark registration applications; and (v) domain names that is included in the LMT Technology (all of the intellectual property described in clauses (i) through (iv), whether now owned or hereafter acquired, is collectively referred to herein as the “ Registered Intellectual Property ” ), Debtor shall notify Creditor of such fact and make all necessary or appropriate filings with respect thereto to cause the security interest in such Registered Intellectual Property to be perfected. Debtor shall promptly and diligently register any such patent, copyright, trademark, service mark, trade name or other proprietary rights of Debtor which is registerable with the applicable governmental or other registration authority. Without the prior written consent of Creditor, Debtor shall not apply to register any copyrightable works or mask works with the U.S. Copyright Office, and any consent to such registration shall be conditioned upon Debtor executing such documents and taking such further actions as Creditor shall reasonably request in its sole discretion to perfect and continue perfected, maintain the priority of or provide notice of, the security interest granted to Creditor under this Agreement in such copyrightable works notwithstanding such copyright registration. Notwithstanding the foregoing, Debtor shall not be obligated to comply with the requirements of this paragraph with respect to any LMT Intellectual Property as to which Debtor contributes and assigns to Crucible Intellectual Property, LLC pursuant to and in accordance with the terms of the MTA.

(d) Debtor agrees with regard to the Collateral and Proceeds, unless Creditor agrees otherwise in writing: (i) that Creditor is authorized to file financing statements in the name of Debtor to perfect Creditor’s security interest in Collateral and Proceeds; (ii) to pay when due all license fees, registration fees and other charges in connection with any Collateral; (iii) not to permit any lien on the Collateral or Proceeds; (vii) not to sell, hypothecate or dispose of, nor permit the transfer by operation of law of, any of the Collateral or Proceeds or any interest therein (other than as permitted or required by the MTA and other than sublicenses of the LMT Technology in the course of Debtor’s business or the portion of the LMT Technology licensed to Debtor pursuant to that certain License Agreement with Crucible Intellectual Property, LLC, of even date herewith); (iv) to permit Creditor to inspect the Collateral at any time; (v) to keep, in accordance with generally accepted accounting principles, complete and accurate records regarding all Collateral and Proceeds, and to permit Creditor to inspect the same and make copies thereof at any reasonable time; (vi) from time to time, when requested by Creditor, to prepare and deliver a schedule of all Collateral and Proceeds subject to this Agreement; and (vii) to provide any service and do any other acts which may be necessary to maintain, preserve and protect all Collateral and, as appropriate and applicable, to keep all Collateral in good and saleable condition, to deal with the Collateral in accordance with the standards and practices adhered to generally by users and owners of like property, and to keep all Collateral and Proceeds free and clear of all defenses, rights of offset and counterclaims.

5. Powers of Creditor. Debtor appoints Creditor its true attorney in fact to perform any of the following powers, which are coupled with an interest, are irrevocable until termination of this Agreement and may be exercised from time to time by Creditor’s officers and employees, or any of them, whether or not an Event of Default has occurred: (a) to perform any obligation of Debtor hereunder in Debtor’s name or otherwise; (b) to prepare, execute, file, record or deliver notes, assignments, schedules, designation statements, financing statements, continuation statements, termination statements, statements of assignment, applications for registration or like papers to perfect, preserve or release Creditor’s interest in the Collateral and Proceeds; (c) to endorse, collect, deliver and receive payment under instruments for the payment of money constituting or relating to Proceeds; (d) to exercise all rights, powers and remedies which Debtor would have, but for this Agreement, with respect to all Collateral and Proceeds subject hereto; (e) to enter onto Debtor’s premises in inspecting the Collateral; and (f) to do all acts and things and execute all documents in the name of Debtor or otherwise, deemed by Creditor as necessary, proper and convenient in connection with the preservation, perfection or enforcement of its rights hereunder. “ Event of Default ” means any breach by Debtor of (a) Section 1(b), 1(c), 2(b) or 8 of the MTA or (b) Section 1(d), 4(c), 4(f), 4(h), 8(g), 8(h), 9(f), 10, 11 or 13 of the MTA; provided that (i) a breach of any section listed in clause (b) shall not constitute an Event of Default where such breach is curable, Debtor has promptly initiated actions to cure such breach, Debtor has vigorously and continuously undertaken to cure such breach and, in any event, such breach is cured within thirty (30) days of Debtor first learning of such breach; and (ii) a breach, whether listed in clause (a) or clause (b), shall not constitute an Event of Default unless such breach could reasonably be expected to have a material adverse effect on Creditor’s rights under the Exclusive License Agreement, of even date herewith, between Crucible Intellectual Property, LLC and Creditor.

6. Payment of Premiums, Taxes, Charges, Liens and Assessments. Debtor agrees to pay, prior to delinquency, all insurance premiums, taxes, charges, liens and assessments against the Collateral and Proceeds, and upon the failure of Debtor to do so, Creditor at its option may pay any of them and shall be the sole judge of the legality or validity thereof and the amount necessary to discharge the same. Any such payments made by Creditor shall be obligations of Debtor to Creditor, due and payable immediately upon demand, together with interest at a rate determined in accordance with the provisions of this Agreement, and shall be secured by the Collateral and Proceeds, subject to all terms and conditions of this Agreement.

7. Remedies. Upon the occurrence of an Event of Default and so long as such Event of Default is continuing, Creditor shall have all other rights, powers, privileges and remedies granted to a secured party upon default under the Uniform Commercial Code or the equivalent body of law in the applicable jurisdiction or otherwise provided by law, including without limitation, the right to sell, lease, license or otherwise dispose of any or all Collateral. All rights, powers, privileges and remedies of Creditor shall be cumulative. No delay, failure or discontinuance of Creditor in exercising any right, power, privilege or remedy hereunder shall affect or operate as a waiver of such right, power, privilege or remedy; nor shall any single or partial exercise of any such right, power, privilege or remedy preclude, waive or otherwise affect any other or further exercise thereof or the exercise of any other right, power, privilege or remedy. Any waiver, permit, consent or approval of any kind by Creditor of any default hereunder, or any such waiver of any provisions or conditions hereof, must be in writing and shall be effective only to the extent set forth in writing. It is agreed that public or private sales or other disposition, for cash or on credit, to a wholesaler or retailer or investor, or user of property of the types subject to this Agreement, or public auctions, are all commercially reasonable since differences in the prices generally realized in the different kinds of dispositions are ordinarily offset by the differences in the costs and credit risks of such dispositions. While Creditor is entitled to exercise its remedies under this Section 7: (a) Debtor will deliver to Creditor from time to time, as requested by Creditor, current lists of all Collateral and Proceeds; (b) Debtor will not dispose of any Collateral or Proceeds except on terms approved by Creditor; (c) at Creditor’s request, Debtor will assemble and deliver all Collateral and Proceeds, and books and records pertaining thereto, to Creditor at a reasonably convenient place designated by Creditor; and (d) Creditor may, without notice to Debtor, enter onto Debtor’s premises and take possession of the Collateral. With respect to any sale or other disposition by Creditor of any Collateral subject to this Agreement, Debtor hereby expressly grants to Creditor the right to sell such Collateral using any or all of Debtor’s trademarks, trade names, trade name rights and/or proprietary labels or marks. Debtor further agrees that Creditor shall have no obligation to process or prepare any Collateral for sale or other disposition. Notwithstanding anything to the contrary set forth in this Agreement, Creditor shall not have any right to foreclose upon or take any other action with respect to the Collateral unless and until an Event of Default has occurred and is continuing, provided that Creditor shall have the right to exercise the powers in Section 5 hereof whether or not an Event of Default has occurred and is continuing.

8. Disposition of Collateral and Proceeds; Transfer of Obligations. In disposing of Collateral hereunder, Creditor may disclaim all warranties of title, possession, quiet enjoyment and the like. Any proceeds of any disposition of any Collateral or Proceeds, or any part thereof, may be applied by Creditor to the payment of expenses incurred by Creditor in connection with the foregoing, including reasonable attorneys’ fees, and the balance of such proceeds may be applied by Creditor toward the payment of the Obligations in such order of application as Creditor may from time to time elect. Upon the transfer of all or any part of the Obligations, Creditor may transfer all or any part of the Collateral or Proceeds and shall be fully discharged thereafter from all liability and responsibility with respect to any of the foregoing so transferred, and the transferee shall be vested with all rights and powers of Creditor hereunder with respect to any of the foregoing so transferred; but with respect to any Collateral or Proceeds not so transferred, Creditor shall retain all rights, powers, privileges and remedies herein given.

9. Statute of Limitations. Prior to the termination of this Agreement pursuant to Section 3 hereof, the power of sale or other disposition and all other rights, powers, privileges and remedies granted to Creditor hereunder shall continue to exist and may be exercised by Creditor at any time and from time to time irrespective of the fact that the Obligations or any part thereof may have become barred by any statute of limitations, or that the personal liability of Debtor may have ceased, unless such liability shall have ceased due to the satisfaction in full of all Obligations secured hereunder.

10. Notices. All notices from one party to the other required or permitted under this Agreement shall be in writing, shall refer specifically to this Agreement, and shall be delivered in person , or sent by electronic or facsimile transmission for which a confirmation of delivery is obtained, or sent by registered mail or express courier services providing evidence of delivery, in each case to the recipient party’s respective address set forth on the signature page to the MTA (or to such updated address as may be specified in writing to the other party from time to time). Such notices will be deemed effective as of the date so delivered or on the third business day following mailing.

11. Costs, Expenses and Attorneys’ Fees. Debtor shall pay to Creditor immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys’ fees (to include outside counsel fees and all allocated costs of Creditor’s in-house counsel), expended or incurred by Creditor in connection with (a) the perfection and preservation of the Collateral or Creditor’s interest therein; and (b) the realization, enforcement and exercise of any right, power, privilege or remedy conferred by this Agreement, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Creditor or any other person) relating to Debtor or in any way affecting any of the Collateral or Creditor’s ability to exercise any of its rights or remedies with respect thereto. All of the foregoing shall be paid by Debtor with interest from the date of demand until paid in full at a rate per annum equal to the greater of (i) 10% or (ii) “prime rate” as reported in The Wall Street Journal in effect from time to time plus two percent.

12. Successors; Assigns; Amendment. This Agreement shall be binding upon and inure to the benefit of the heirs, executors, administrators, legal representatives, successors and assigns of the parties, and may be amended or modified only in writing signed by Creditor and Debtor.

13. Severability of Provisions. If any provision of this Agreement shall be held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or any remaining provisions of this Agreement.

14. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict of laws principles to the contrary. The parties hereby consent to jurisdiction and venue in the appropriate state and Federal courts sitting in the Northern District of California in any litigation between them arising out of this Assignment. If any provision of this Agreement is held to be invalid or unenforceable to any extent in any context, it shall nevertheless be enforced to the fullest extent allowed by law in that and other contexts, and the validity and force of the remainder of this Agreement shall not be affected thereby.

15. Jurisdiction. In the event of a dispute, either party may commence litigation in the state or federal courts in Santa Clara County, California. The parties irrevocably submit to the exclusive jurisdiction of those courts and agree that final judgment in any action or proceeding brought in such courts will be conclusive and may be enforced in any other jurisdiction upon final and conclusive judgment (a certified copy of which will be conclusive evidence of the judgment) or in any other manner provided by law. Each party irrevocably waives to the fullest extent permitted by applicable law (i) any objection it may have to the laying of venue in any court referred to above; (ii) any claim that any such action or proceeding has been brought in an inconvenient forum; and (iii) any immunity that it or its assets may have from any suit, execution, attachment (whether provisional or final, in aid of execution, before judgment or otherwise) or other legal process.

[END OF DOCUMENT TEXT; SIGNATURES TO FOLLOW]

IN WITNESS WHEREOF, this Agreement has been duly executed as of August 4, 2010. Each of the persons signing this Agreement affirms that he or she is duly authorized to do so and thereby to bind the indicated entity. This Agreement may be executed simultaneously i n two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

LIQUIDMETAL TECHNOLOGIES, INC. a Delaware corporation

By	/s/ Tony Chung
Its	Chief Financial Officer

Exhibit A

Collateral

The “Collateral” shall consist of the following:

(i) All of Debtor’s right, title and interest, whether now existing or hereafter arising, in the “LMT Technology” to the extent not assigned to Crucible Intellectual Property, LLC, a Delaware limited liability company (“Crucible”) in accordance with the MTA.

(ii) The Exclusive License Agreement, dated July __, 2010 between Crucible and Debtor, as the same may be amended, modified, supplemented and amended and restated from time to time.

(iii) All membership interests of Crucible, now existing and any membership interest of Crucible hereafter issued, all securities or other instruments in addition to, in substitution of, or in exchange for any of such membership interest (whether as a distribution in connection with any recapitalization, reorganization or reclassification, a stock dividend or otherwise), and any distributions of cash or property in respect of the items described in this clause (iii).

(iv) All Proceeds (as defined in the California Uniform Commercial Code) of the foregoing.

For purposes of the foregoing the following definitions apply:

(i) “LMT Technology” shall mean any and all Intellectual Property and Intellectual Property Rights that, at any time during the Capture Period, is: (a) owned or licensed (including without limitation sub-licensed) by Debtor or Liquidmetal Coatings, LLC, a Delaware limited liability company (“LMC”), or that Debtor or LMC have a right to use; or (b) owned or licensed (including without limitation sub-licensed) by Crucible, or that Crucible has a right to use, after being transferred to Crucible by Debtor or LMC. For the avoidance of doubt, any Intellectual Property Rights related to or arising from Intellectual Property first created, conceived, invented, or discovered before the end of the Capture Period shall be deemed to be within the definition of LMT Technology. Thus, for example, a patent application or copyright application filed, or any patent issued or copyright registration issued, more than five years after the Closing Date, but that is related to an invention conceived or work created within eighteen (18) months of the date on which the license is granted to Apple pursuant to Section 9(a) of the MTA (“Closing Date”), shall be deemed within the definition of LMT Technology. For purposes of clarification, however, improvements or derivatives of LMT Technology first created, conceived, invented, or discovered after the Capture Period shall not be “LMT Technology” notwithstanding the fact that such improvements or derivatives are derived from, improve, or otherwise relate to LMT Technology. The LMC patents and all LMC trademarks identified in Annex 15 of the MTA are excluded from “LMT Technology.”

(ii) “Intellectual Property” shall mean and includes all algorithms, application program interfaces, customer lists, databases, schemata, design documents and analyses, diagrams, documentation, drawings, formulae, discoveries and inventions (whether or not patentable), know-how, literary works, copyrightable works, works of authorship, mask works, logos, marks (including names, logos, slogans, and trade dress), methods, methodologies, architectures, processes, program listings, programming tools, proprietary information, protocols, schematics, specifications, software, software code (in any form including source code and executable or object code), subroutines, user interfaces, techniques, uniform resource locators, web sites, and all other forms and types of technology (whether or not embodied in any tangible form and including all tangible embodiments of the foregoing such as compilations of information, instruction manuals, notebooks, prototypes, reports, samples, studies, and summaries).

(iii) “Intellectual Property Rights” shall mean and includes all past, present, and future rights of the following types, which may exist or be created under the laws of any jurisdiction in the world: (a) rights associated with works of authorship, including exclusive exploitation rights, copyrights, moral rights, and mask works; (b) trademark and trade name rights and similar rights; (c) trade dress rights; (d) trade secret rights; (e) patents and industrial property rights; (f) other proprietary rights in Intellectual Property of every kind and nature; and (g) all registrations, renewals, extensions, combinations, divisions, continuations, continuations in part, reexamination certificates, or reissues of, and applications for, any of the rights referred to in clauses (a) through (f) above.

(iv) “Capture Period” shall mean the period commencing on the Closing Date and ending on the eighteen month anniversary of the Closing Date.

ANNEX 11

LMT-SPE Security Agreement

SECURITY AGREEMENT

1. Grant of Security Interest. For valuable consideration, the undersigned CRUCIBLE INTELLECTUAL PROPERTY, LLC, a Delaware limited liability company ( “ Debtor ” ), hereby grants and transfers to APPLE INC., a California corporation ( “ Creditor ” ), a security interest in all of the following property of Debtor, now existing or hereafter arising (collectively, the “ Collateral ” ): (i) all accounts; (ii) all chattel paper; (iii) all commercial tort claims; (iv) all deposit accounts; (v) all documents; (vi) all equipment; (vii) all general intangibles; (viii) all instruments; (ix) all inventory; (x) all investment property; (xi) all letters of credit and letters-of-credit rights; (xii) all money; (xiii) all other goods not otherwise included in any of clauses (i) - (xii) of this Section 1 and (xiv) all supporting obligations, together with whatever is receivable or received when any of the foregoing or the proceeds thereof are sold, leased, collected, exchanged or otherwise disposed of, whether such disposition is voluntary or involuntary, including without limitation, all rights to payment, including returned premiums, with respect to any insurance relating to any of the foregoing, and all rights to payment with respect to any claim or cause of action affecting or relating to any of the foregoing (collectively, “ Proceeds ” ). The security interest granted pursuant to this Agreement shall be subject and subordinate to all rights, powers and privileges of (a) Creditor, as licensee, under that certain Exclusive License Agreement of even date herewith (the “ Apple License ” ) between Creditor and Debtor, and (b) Liquidmetal Coatings, LLC, a Delaware limited liability company ( “ LMC ” ), under that certain Exclusive License Agreement of even date herewith (the “ LMC License ” ) between Debtor and LMC. Creditor hereby agrees that in the event the security interest granted pursuant to this Agreement shall be enforced and, as a result of such enforcement, any of the Collateral shall be transferred to any person or entity, (i) such person or entity shall acquire or otherwise receive any such Collateral subject to all rights, powers and privileges of Creditor and LMC under the Apple License and the LMC License, respectively, (ii) such acquirer may not interfere with or disturb Apple’s or LMC’s respective use and enjoyment of their rights, powers and privileges under the Apple License and LMC License, respectively, and (iii) the Apple License and the LMC License shall continue in full force and effect as if such security interest had not been granted or enforced. A term not otherwise defined in this Agreement but defined in the California Uniform Commercial Code ( “ UCC ” ) shall have the meaning ascribed to it in the UCC. LMC and its successor and assigns are intended third-party beneficiaries of the provisions in this Section 1 that relate to LMC or the LMC License Agreement (collectively, the “ LMC Provisions ” ); and LMC and its successors and assigns shall have the right to enforce the LMC provisions as if original parties hereto; and no such LMC Provisions may be amended or otherwise modified without first obtaining the written consent of LMC or its successors and assigns, as applicable. Nothing in the preceding sentence shall prohibit or otherwise restrict the Creditor and Debtor from amending or otherwise modifying any provisions of this Agreement that are unrelated to the LMC Provisions; and no such unrelated amendments or modifications shall require that any notice be given to, or that any consent be obtained from, LMC or its successors or assigns.

2. Obligations Secured. The obligations secured hereby are the payment and performance of (a) all present and future obligations of Debtor to Creditor under the Master Transaction Agreement of even date herewith ( “ MTA ” ), the Exclusive License Agreement of even date herewith, and the other “Transaction Documents” (as defined in the MTA) between Debtor and Creditor, as the same may be amended, modified, supplemented or amended and restated from time to time; and (b) all obligations of Debtor and rights of Creditor under this Agreement, as the same may be amended, modified, supplemented or amended and restated from time to time (the “ Obligations ” ). The word “ Obligations” is used herein in its most comprehensive sense and includes any and all debts, obligations and liabilities of Debtor under the MTA and Transaction Documents, including, without limitation, the obligation to pay damages to Creditor relating to the MTA.

3. Termination. This Agreement and the security interests hereunder will terminate upon the earlier of (a) the payment and performance of all obligations of Debtor to Creditor under the Transaction Documents or (b) the second (2 nd ) anniversary of the date of this Agreement; provided that if an Event of Default under this Agreement or an “Event of Default” under the Security Agreement of even date between LMT and Creditor shall have occurred and be continuing on the second (2 nd ) anniversary of the date of this Agreement, this Agreement shall not terminate until such Event of Default has been cured or waived by Creditor. Upon the termination of this Agreement and the security interests hereunder, Creditor will, upon the written request of Debtor, confirm such termination in writing and file (or grant Debtor in writing authorization to file) any termination statements or lien releases necessary to evidence the termination of this Agreement and the security interests hereunder.

4. Covenants of Debtor.

(b) If and when Debtor shall obtain rights to any (i) patents or patent applications; (ii) copyright registrations or copyright registration applications; (iii) mask works or mask work registration applications; (iv) trademark registrations or trademark registration applications; and (v) domain names that is included in the LMT Technology (all of the intellectual property described in clauses (i) through (iv), whether now owned or hereafter acquired, is collectively referred to herein as the “ Registered Intellectual Property ” ), Debtor shall notify Creditor of such fact and make all necessary or appropriate filings with respect thereto to cause the security interest in such Registered Intellectual Property to be perfected. Debtor shall promptly and diligently register any such patent, copyright, trademark, service mark, trade name or other proprietary rights of Debtor which is registerable with the applicable governmental or other registration authority. Without the prior written consent of Creditor, Debtor shall not apply to register any copyrightable works or mask works with the U.S. Copyright Office, and any consent to such registration shall be conditioned upon Debtor executing such documents and taking such further actions as Creditor shall reasonably request in its sole discretion to perfect and continue perfected, maintain the priority of or provide notice of, the security interest granted to Creditor under this Agreement in such copyrightable works notwithstanding such copyright registration.

(c) Debtor agrees with regard to the Collateral and Proceeds, unless Creditor agrees otherwise in writing: (i) that Creditor is authorized to file financing statements in the name of Debtor to perfect Creditor’s security interest in Collateral and Proceeds; (ii) to pay when due all license fees, registration fees and other charges in connection with any Collateral unless otherwise required by the MTA; (iii) not to permit any lien on the Collateral or Proceeds; (vii) not to sell, hypothecate or dispose of, nor permit the transfer by operation of law of, any of the Collateral or Proceeds or any interest therein (excluding the grant of the licenses provided for in the Apple License Agreement and LMT License Agreement, as those terms are defined in the MTA); (iv) to permit Creditor to inspect the Collateral at any time; (v) to keep, in accordance with generally accepted accounting principles, complete and accurate records regarding all Collateral and Proceeds, and to permit Creditor to inspect the same and make copies thereof at any reasonable time; (vi) from time to time, when requested by Creditor, to prepare and deliver a schedule of all Collateral and Proceeds subject to this Agreement; and (vii) to provide any service and do any other acts which may be necessary to maintain, preserve and protect all Collateral and, as appropriate and applicable, to keep all Collateral in good and saleable condition, to deal with the Collateral in accordance with the standards and practices adhered to generally by users and owners of like property, and to keep all Collateral and Proceeds free and clear of all defenses, rights of offset and counterclaims.

5. Powers of Creditor. Debtor appoints Creditor its true attorney in fact to perform any of the following powers, which are coupled with an interest, are irrevocable until termination of this Agreement and may be exercised from time to time by Creditor’s officers and employees, or any of them, whether or not an Event of Default has occurred: (a) to perform any obligation of Debtor hereunder in Debtor’s name or otherwise; (b) to release or substitute security; (c) to prepare, execute, file, record or deliver notes, assignments, schedules, designation statements, financing statements, continuation statements, termination statements, statements of assignment, applications for registration or like papers to perfect, preserve or release Creditor’s interest in the Collateral and Proceeds; (d) to endorse, collect, deliver and receive payment under instruments for the payment of money constituting or relating to Proceeds; (e) to exercise all rights, powers and remedies which Debtor would have, but for this Agreement, with respect to all Collateral and Proceeds subject hereto; (f) to enter onto Debtor’s premises in inspecting the Collateral; and (g) to do all acts and things and execute all documents in the name of Debtor or otherwise, deemed by Creditor as necessary, proper and convenient in connection with the preservation, perfection or enforcement of its rights hereunder. “Event of Default” means any breach by Debtor of (a) Section 3(b) of the MTA or (b) Sections 5(a), 5(c), 5(d) or 6 of the MTA or section 4.3 of the Exclusive License Agreement, of even date herewith, between Debtor and Creditor (the “ Apple License Agreement ” ); provided that (i) a breach of any section listed in clause (b) shall not constitute an Event of Default where such breach is curable, Debtor has promptly initiated actions to cure such breach, Debtor has vigorously and continuously undertaken to cure such breach and, in any event, such breach is cured within thirty (30) days of Debtor first learning of such breach; and (ii) a breach, whether listed in clause (a) or clause (b), shall not constitute an Event of Default unless such breach could reasonably be expected to have a material adverse effect on Creditor’s rights under the Apple License Agreement.

10. Notices. All notices from one party to the other required or permitted under this Agreement shall be in writing, shall refer specifically to this Agreement, and shall be delivered in person, or sent by electronic or facsimile transmission for which a confirmation of delivery is obtained, or sent by registered mail or express courier services providing evidence of delivery, in each case to the recipient party’s respective address set forth on the signature page to the MTA (or to such updated address as may be specified in writing to the other party from time to time). Such notices will be deemed effective as of the date so delivered or on the third business day following mailing.

[END OF DOCUMENT TEXT; SIGNATURES TO FOLLOW]

IN WITNESS WHEREOF, this Agreement has been duly executed as of August 4, 2010. Each of the persons signing this Agreement affirms that he or she is duly authorized to do so and thereby to bind the indicated entity. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

Crucible Intellectual Property, LLC, a Delaware limited liability company

By	/s/ Tony Chung
Its	Chief Financial Officer

ANNEX 12

Form of Release

RELEASE

This Release (this “ Release ”) is being executed and delivered by the undersigned (each, a “ Releasor ”) in accordance with Section 5(j) of the Master Transaction Agreement, dated August 5, 2010 (the “ Agreement ” ) between Apple Inc., a California corporation (“Apple”), Liquidmetal Technologies, Inc. a Delaware corporation, Liquidmetal Coatings, LLC, a Delaware limited liability company, and Crucible Intellectual Property, LLC, a Delaware limited liability company. Capitalized terms used in this Release without definition have the respective meanings given to them in the Agreement.

Each Releasor, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound, hereby agree as follows:

1. Each Releasor acknowledges that execution and delivery of this Release is an obligation of it under the Agreement and that Apple relied on the agreement of such Releasor to execute and deliver this Release in consummating the transactions contemplated in the Agreement.

2. Each Releasor hereby releases and forever discharges Apple, and its respective officers, directors, stockholders, members, managers, subsidiaries, successors and assigns (individually, a “ Releasee ” and collectively, “ Releasees ”) from any and all claims, demands, proceedings, causes of action, orders, obligations, contracts, agreements, debts and liabilities whatsoever, whether known or unknown, suspected or unsuspected, both at law and in equity (“ Claim(s) ”), that the Releasor now has, has ever had or may hereafter have against Releasees arising specifically as a result of any act or omission made by Apple in the exercise by Apple of any right, power or privilege, or in the performance of any obligation, under Section 5(a) of the Agreement; provided, however, that the foregoing release shall not apply to (i) any act or omission made by a Releasee in bad faith, with gross negligence, or with willful misconduct, (ii) any failure by Apple to pay any cost required to be paid by Apple in Section 5 of the Agreement.

3. Each Releasor hereby irrevocably covenants to refrain from, directly or indirectly, asserting any claim or demand, or commencing, instituting or causing to be commenced, any proceeding of any kind against any Releasee, based upon any matter released hereby.

4. Without in any way limiting any of the rights and remedies otherwise available to any Releasee, Releasor shall indemnify and hold harmless each Releasee from and against all loss, liability, claim, damage (including incidental and consequential damages) or expense (including costs of investigation and defense and reasonable attorney’s fees) whether or not involving third party claims, arising directly or indirectly from or in connection with (i) the assertion by or on behalf of the Releasor or any of its affiliates, and its respective officers, directors, stockholders, members, managers or partners, or any other person holding a direct or indirect interest in the Releasor or an affiliate of the Releasor, of any claim or other matter released pursuant to this Release and (ii) the assertion by any third party of any claim or demand against any Releasee which claim or demand arises directly on indirectly from, or in connection with, any assertion by or on behalf of the Releasor or any of its affiliates against such third party of any claims or other matter released pursuant to this Release. In furtherance of this Release, the Releasor waives any right it may have under any statutes and regulations, which states, in substance:

“A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which, if known by him, may have materially affected his settlement with the debtor”

5. Each Releasor acknowledges that it has been provided the opportunity to retain counsel of the Releasor’s choosing to advise the Releasor regarding this Release or has voluntarily elected not to consult counsel. Releasor represents and warrants that it has not assigned any Claim (or any part thereof) and that Releasor is unaware of any individual or entity asserting an interest or right in or with respect to any Claim.

6. If any provision of this Release is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Release will remain in full force and effect. Any provision of this Release held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.

7. This Release may not be changed except in a writing signed by the person(s) against whose interest such change shall operate. This Release shall be governed by and construed under the laws of the State of California without regard to principles of conflicts of law.

8. All words used in this Release will be construed to be of such gender or number as the circumstances require.

9. Facsimile or other electronically delivered copies of the signature page to this Release shall be treated as between the parties as original signatures for all purposes, notwithstanding that the original copy bearing the party’s original signature and used to generate the facsimile or other copy transmission is not delivered.

[Signature Page Follows]

IN WITNESS WHEREOF, the undersigned has executed and delivered this Release as of this 4 th day of August , 2010

RELEASOR:

LIQUIDMETAL TECHNOLOGIES, INC.

By	/s/ Larry Buffington

Its	PRESIDENT / CEO

LIQUIDMETAL COATINGS, INC.

By	/s/ Larry Buffington

Its	PRESIDENT / CEO

CRUCIBLE INTELLECTUAL PROPERTY, LLC

By	/s/ Tony Chung

Its	Chief Financial Officer

ANNEX 13

Patent Counsel Engagement Letter

Pillsbury Winthrop Shaw Pittman LLP

2300 N Street, NW | Washington, DC 20037-1122 | tel 202.663.8000 | fax 202.663.8007

Raj S. Dav é

tel 202.663.8228

raj.dave@pillsburylaw.com

August 2, 2010

Crucible Intellectual Property LLC

30452 Esperanza

Rancho Santa Margarita, CA 92688

Attention: Mr. Ricardo A. Salas

Apple, Inc.

1 Infinite Loop

Cupertino, CA 95014

Attention: Mr. Patrick J. Murphy

Re:	Engagement for legal services to be performed by Pillsbury Winthrop Shaw Pittman LLP

Dear Rick and Patrick:

The purpose of this letter is to confirm the terms and conditions of our representation of Crucible Intellectual Property LLC (“Crucible IP”) and Apple Inc. (“Apple”) (collectively “you,” “your”); and to disclose and seek your consent to certain possible conflicts of interest regarding that joint representation. The applicable Rules of Professional Conduct for attorneys, under which we practice, require us to send you this engagement letter. When you have signed and returned to me the enclosed copy of this letter, this will constitute our agreement to perform services for you as set forth below.

1. Nature of the Engagement

We understand that under that certain Master Transaction Agreement (“MTA”) between Apple and Liquidmetal Technologies, Inc. and its subsidiaries, that it has been agreed therein that Apple shall have the sole and exclusive right, in the United States and other jurisdictions around the world, to control patent prosecution for inventions, current and future patent applications and patents that have been or will be assigned to Crucible IP. Section 5(c) of the MTA provides that Crucible IP and Apple will execute an engagement letter in the form of this engagement letter, retaining patent counsel to represent both Apple and Crucible IP with respect to such patent applications. This engagement letter is the engagement letter referred to in Section 5(c) of the MTA.

www.pillsburylaw.com

Patent Counsel Joint Engagement LettervFINAL

Crucible Intellectual Property LLC

Apple, Inc.

August 2, 2010

Page 2 of 6

In connection with this engagement, you hereby instruct us to set up a joint customer number in the United States Patent Office for Apple and Crucible IP to allow Apple and Crucible IP to monitor prosecution activities for all patent applications within the United States.

You further instruct us to prepare and send to Apple and Crucible IP a quarterly patent prosecution report that will include such matters as each of Apple and Crucible IP shall direct and shall include, without limitation: (i) information identifying invention disclosures on which Apple has decided not to file patent applications, and stating whether such inventions shall be treated as trade secrets or whether Crucible IP is free to pursue patent protection thereon at its own expense using other counsel, and to file patent applications; (ii) jurisdictions where Apple has decided to file patent applications; (iii) which patent applications Apple has decided to let go abandoned; (iv) any continuations, continuation-in-parts, or divisional applications Apple has decided to file, and (v) what fees (including without limitation, issue fees, publication fees, maintenance fees, grant fees and annuity fees) Apple intends not to pay.

We understand that while Crucible IP will provide materials for preparing, filing and prosecuting new patent applications, and will respond to requests for material, information and assistance as we may make from time to time in connection with our representation, Apple alone will give us instructions in connection with our representation of Crucible IP.

For the sake of clarity, we have advised that Pillsbury does not handle the payment of maintenance fees or annuities on granted US or foreign patents. If you do not already have an arrangement for handling these payments, we suggest that you engage Computer Patent Annuities (“CPA”) or other vendor directly to handle monitoring and payment of your annuities. CPA presently handles approximately 1,000,000 renewal payments each year and has relationships with patent and trademark offices in every country in the world. CPA is in no way affiliated with Pillsbury, and other maintenance fee and annuity service companies are also available if you would like to explore other vendors. Of course, you can attend to these payments yourself (without use of a vendor), but we recommend against this approach. Please inform us as soon as possible which vendor you currently use or plan to engage for payment of maintenance fees and annuities on granted patents so that we may update our records accordingly.

Our joint representation of Crucible IP and Apple gives rise to specific issues, discussed below.

www.pillsburylaw.com

Patent Counsel Joint Engagement LettervFINAL

Crucible Intellectual Property LLC

Apple, Inc.

August 2, 2010

Page 3 of 6

2. Conflicts of Interest

Actual conflicts: Because of the proliferation today of companies affiliated through common or partial ownership, and the problems this can create in identifying potential conflicts of interest, we advise our clients that this Firm will not regard any affiliate of a client ( i.e., parent, subsidiary or other related entity) as a client of the Firm for any purpose, unless an attorney-client relationship with that affiliate has been established by an express written agreement with the Firm. Similarly, the Firm will not regard a representation that is adverse to an affiliate of a client as being adverse to the client. In this regard, it is specifically understood and agreed that Liquidmetal Technologies, Inc. and its other subsidiaries and affiliates (LMT), are adverse parties in connection with the MTA referred to above, that Pillsbury has and is representing Apple in connection with the MTA and related matters adverse to LMT. It is, therefore, specifically agreed and acknowledged that this engagement to represent Crucible IP shall not and does not constitute an engagement to represent LMT or any other affiliated company and that it does not constitute a conflict of interest for Pillsbury to continue to represent Apple in any and all matters adverse to LMT.

Based on the information provided to us, we do not believe that this limited representation of Apple and Crucible IP as joint clients on the designated patent matters involves an actual conflict of interest since your interests in the patent portfolio are sufficiently aligned and where they may differ you have made arrangements between you for how that will be handled. If you are aware of any actual conflict of interest, please let us know immediately.

We have discussed with you the other areas of potential conflicts, which are briefly referred to below. In light of these potential conflicts, we need written consent from both Crucible IP and Apple.

Potential conflicts: Even though there may be no actual conflict, there are potential conflicts. Differences in your interests and objectives that may develop over time could make one approach more favorable to one or the other, or could lead to disputes between the two of you. In representing multiple clients, it is understood that we will be balancing interests rather than asserting the interests of only one party. While this potential conflict is unlikely to develop into an actual conflict, given the fact that Apple will have sole and exclusive right to control patent prosecutions, you should be aware of the possibility.

Under the applicable Rules of Professional Conduct relating to representation of multiple clients where there may be actual or potential conflicts of interest between or among them, as noted above, we must obtain your written consent to the joint representation. This letter, when executed, will confirm our agreement and your consent to our firm’s representation of both Crucible IP and Apple in the referenced matter, and your waiver of the potential conflicts of interest that this joint representation poses. In this regard, as sophisticated consumers of legal services and with your own in-house and outside counsel, we must nevertheless briefly discuss the pros and cons of the requested waiver.

www.pillsburylaw.com

Patent Counsel Joint Engagement LettervFINAL

Crucible Intellectual Property LLC

Apple, Inc.

August 2, 2010

Page 4 of 6

Implications of joint representation for privileges: In addition to dealing with potential disagreements as to strategies and tactics, a joint representation has implications on the attorney client privilege and confidentiality. As to the attorney client privilege, the prevailing rule is that as between commonly represented clients, the privilege does not attach. Hence, should any future dispute between Crucible IP and Apple concerning this engagement lead to litigation, the privilege will not protect such communications on the subject of the joint engagement that were commonly shared. As to confidentiality, neither Apple nor Crucible IP should have any expectation that information provided to us in connection with this engagement will be kept confidential from the other. While we will protect your confidences against disclosure to third persons, you should not expect that information provided to us in connection with this specific engagement will be kept confidential from Apple or Crucible IP. Because we will have the same duty of loyalty to each, such information will be shared and the Firm conceivably could have to withdraw if one of you decides that some matter material to the representation should be kept from the other.

Further, in light of the fact that the Firm is already counsel to Apple as previously noted, in the event of any dispute between you regarding our engagement, Crucible IP agrees that we may continue to represent Apple and may withdraw from representing Crucible IP, and may use in the continuing representation of Apple any information that we learned during the course of joint representation.

In addition, as you know, the Firm represents many different clients with diverse interests. Many of our clients compete with one another and do business with one another. As discussed above, we are precluded by the Rules of Professional Conduct from representing a client in a matter in which the client’s interests are adverse to the interests of another client of the firm, even if those matters are totally unrelated to each other, absent the written consent of both clients. In the future, we may be asked to represent another client in a transaction or dispute adverse to Crucible IP, where that transaction or dispute is unrelated to the matter involved in this representation. For that circumstance, we also ask that Crucible IP give us advance consent at this time to any such representation and that it waive any conflicts that such a representation would present.

By signing the consent set forth below, each of you agrees to our joint representation of each of you in this engagement and agrees not to assert any conflict of interest based upon this joint representation, notwithstanding any adversity that may develop.

3. Fees, Costs, Billing Policies and Procedures.

It is our understanding that Apple will be solely responsible for payment of any and all fees and expenses incurred during the course of the joint representation, pursuant to the current terms of the Firm’s representation agreement with Apple. You have not asked us to be involved in any respect in giving advice concerning the financial arrangements between you as to this joint engagement. We will, therefore, proceed by submitting our invoices for payment directly to Apple, unless and until we receive written notice from both Crucible IP and Apple setting forth and agreeing to a different arrangement.

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Patent Counsel Joint Engagement LettervFINAL

Crucible Intellectual Property LLC

Apple, Inc.

August 2, 2010

Page 5 of 6

4. Termination.

Apple may terminate our representation at any time, with or without cause, by providing written notice to us.

We have the right to withdraw from our representation of Crucible IP subject to any applicable professional responsibility rules. In addition, certain circumstances may arise that require us to withdraw from continuing to represent a client. We will identify in advance and discuss with both Crucible IP and Apple any situation that might require or lead to our withdrawal from representation.

5. Return of Files and Other Materials at Completion of Engagement.

If this engagement is terminated by Apple under paragraph 4 above, Crucible IP’s papers and any of their other property will be returned promptly upon our receipt of a written request from Crucible IP for their return. At our own expense, we may retain a copy of all files, records and documents involving the matter. A copy of all such material may also be provided to Apple, upon Apple’s request.

Otherwise, at the completion of this engagement, either of you may request the return of any client papers, files and other property in our possession. Such a request should be made in writing. In working on the engagement, we will preserve communications and documents in either hard-copy or electronic form, depending on the circumstances. If you do not request the return of such materials, we will maintain them only for a period of five (5) years, after which time you agree that we may dispose of them. Prior to disposal of such materials, we will endeavor to advise you in writing, at the last known address in our files, of our intent to do so and give you another opportunity to request the materials if you so desire. Any disposal will be made in a confidential manner. You agree to pay for all time and costs related to identification, review and return to you of any materials, including as may be necessary duplicates for each client. At our sole discretion and expense, we may make and keep a copy of any materials being returned to you.

6. Arbitration of Disputes.

If you have any concern as to any matter related to or arising out of this engagement, including the nature and quality of our services, please discuss any such questions or concerns with us. Typically, such questions or concerns can be resolved to the satisfaction of all parties with little inconvenience or formality. In the event any dispute cannot be resolved informally, you agree to resolve any and all disputes with the Firm, or with any of our lawyers or staff arising from or relating to our work for you under this engagement, exclusively through private and confidential binding arbitration before the American Arbitration Association, under the rules for commercial disputes, before one neutral arbitrator for any dispute where the claim is less than $100,000, or before three neutral arbitrators for any larger dispute.

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Patent Counsel Joint Engagement LettervFINAL

Crucible Intellectual Property LLC

Apple, Inc.

August 2, 2010

Page 6 of 6

7. Review and Return of Letter.

We ask that you each review this letter carefully and let us know if there is any provision that you do not understand. If the terms of this letter are acceptable, please sign the enclosed copy of this letter and return it to me. We recommend that you keep a signed copy of this letter in your files. If you have questions or concerns about any aspect of our services or the relationship at any time, please do not hesitate to contact me.

We are pleased to have this opportunity to be of service and look forward to working with you on this engagement.

Very truly yours,

PILLSBURY WINTHROP SHAW PITTMAN LLP

Raj S. Dav é , D.Sc.

Partner

Accepted and agreed to:
CRUCIBLE INTELLECTUAL PROPERTY, INC.

By:	/s/ Tony Chung
	Name: Tony Chung
	Title: Chief Financial Officer

Date:	8/4/10

Accepted and agreed to:
APPLE, IN C.

By	/s/ Zadesky
	Name: Zadesky
	Title: VP Product Design

Date:	8/5/10

www.pillsburylaw.com

Patent Counsel Joint Engagement LettervFINAL

ANNEX 14

Due Diligence Checklist

APPLE CONFIDENTIAL

		Notes

	F. All minutes of meetings of directors, committees of directors and stockholders of the Company since January 1, 2005.	BOD Minutes – 2005 (1.25) BOD Minutes – 2006 (1.24) BOD Minutes – 2007 (1.23) BOD Minutes – 2008 (1.22) BOD Minutes – 2009 (1.13) BOD Minutes – 2010 (1.16)

	G. Any due diligence report prepared for the Company or with respect to the Company, to the extent available.	None

	H. Press releases relating to the Company not otherwise posted on the Company’s website.	None

	I. All material documentation relating to the Company’s disclosure and internal controls and procedures, including any related attestations, reports, correspondence or written materials.	Foley & Lardner Letter – 2010.04 (1.14)

	J. All charters of committees and subcommittees of the Board (including Audit, Compensation, Nominating / Corporate Governance, Disclosure and any other committees).	Audit Committee Charter 2007 (1.5) Comp Committee Charter 2007 (1.6) Corp Gov & Nom Comm Charter 2007 (1.7)

	K. Company representation letters to auditors (last two years).	Rep letter – LMT – 2008 YE (1.17) Rep letter – LMT – 2007 YE (1.18)

II.	SECURITY-RELATED MATTERS

	A. A capitalization schedule setting forth the number of authorized, issued, outstanding and treasury shares of each class of securities of the Company.	Schedule II.A (2.8)

	B. Copies of private placement memoranda or offering circulars relating to sales of debt or equity securities and any purchase agreements, indentures or other agreements governing the terms of any indebtedness incurred by the Company or its subsidiaries (excluding any PPM or offering circular comprised solely of the Company’s filed SEC reports) for offerings or sales of equity or debt securities made during the prior 2 years.	None

	C. Copies of any agreements relating to the election of directors.	See I.D. – Delaware Filing (1.2) Certificate of Designation (2.1)

	D. Copies of all agreements relating to repurchases, redemptions, exchanges, conversions or similar transactions.	See III.D

	E. Copies of all agreements and instruments containing restrictions on transfer, encumbrances upon, or other restrictions with respect to, the capital stock of the Company.	None

APPLE CONFIDENTIAL

		Notes

III.	DEBT AGREEMENTS; INVESTMENTS

	A. List of banks or other lenders with which the Company have a financial relationship and brief description of the nature of relationship, e.g., lines of credit, etc.	Schedule III.A (3.32) LMC – Enterprise Bank Agreements and 8-K (3.31) Please note the following are uploaded but are early drafts of the Enterprise documents above: Credit Agreement – Liquidmetal Coatings (3.20); Term Note (3.21); Revolving Credit Note (3.22); Security Agreement – Liquidmetal (Coatings) (3.23)

	B. Lines of credit and any other loan agreements, promissory notes or guarantees, letters of credit, security agreements, pledge agreements, equipment leases, including any amendments or renewals, etc.	Schedules III.A and B (3.32 and 3.33) Toyota Loan (3.18) Hyster Forklift Lease (3.17)

	C. Summary of all currently outstanding interest rate or foreign currency swaps, caps, options, forwards or other derivative instruments or arrangements to which the Company is a party.	None

APPLE CONFIDENTIAL

			Notes

	D. All instruments evidencing debt obligations and all agreements and material correspondence relating thereto. Any other actual or contingent indebtedness ( e.g., loan guarantees, letters of credit, mortgages, liens, pledges, indemnifications, banker’s acceptances, swaps, other derivative agreements relating to indebtedness, or other encumbrances of any nature whatsoever) and all agreements and material correspondence relating thereto.		Form of Senior Secured Convertible Note (3.1) Fort Mason Master Original Notes (3.38 – 3.40) Fort Mason Partners Original Notes (3.41 – 3.43) Tail Wind Fund Original Notes (3.44 – 3.46) Solomon Strategic Holdings Original Notes (3.47 – 3.49) Castlerigg Master Original Notes (3.50 – 3.52) Diamond Opportunity Original Notes (3.53 – 3.55) Rockmore Original Notes (3.56 – 3.58) BridgePointe Original Notes (3.59 –3.61) Rodd Friedman Original Notes (3.65 – 3.67) M Neugeboren Original Notes (3.68 – 3.70) E Neugeboren Original Notes and Lost Affidavit (3.71 – 3.73) Wynnefield LPl Original Notes (3.74 – 3.76) Wynnefield LP Original Notes (3.77 – 3.79) Wynnefield Offshore Original Notes (3.80 – 3.82) Vestal Lost Affidavits & 5-1-10 Original Note (3.83) Norden 2010 Original Note (3.84) R Salas – Lost Affidavit bridge note (3.85) Security Agreement (3.2) Registration Rights Agreement (2.5) Form of Common Stock Purchase Warrant for Noteholders (2.6) Note – 2006.12.01 (Sub Note) (3.5) Debt Schedule 04 30 2010 (3.25) Norden – Subordinated Promissory Note (3.28) Norden – Subscription Agreement (3.29) Debt Schedule 06 30 2010 (3.34)

APPLE CONFIDENTIAL

		Notes

	E. Any other agreements relating to financing arrangements by the Company or its subsidiaries, including any guarantees, sale and leaseback arrangements and mortgages.	LQMT – Series B Terms Sheet (2.7)

	F. All notices of default or noncompliance from lenders during the last year relating to such debt instruments (excluding separately dated default notices for the same default for which at least one notice was provided) and all compliance reports submitted by the Company or its accountants.	See IV.B

	G. Correspondence with lenders, including waivers, compliance certificates and opinions of counsel regarding compliance or non-compliance with debt obligations, other than with respect to correspondence older than June 1, 2008 for obligations no longer in default.	See IV.B LMC Borrowing Base Certificate 04.26.10 (3.19)

	H. All agreements regarding obligations or liabilities of the Company as a guarantor. surety, co-signer, endorser, co-maker, indemnitor or otherwise in respect of the obligation of any other person or entity.	See III.A, B and D

	I. All agreements by which the Company is obligated or required to provide, or under which the Company is currently providing, funds in the form of a loan, capital contribution or otherwise.	See VI.F for LMCSI Joint Venture Agreement – 2010.05.04 (6.12)

	J. All loan agreements, intercompany notes and guarantees between the Company and any of its employees or affiliates.	Schedule III.J (3.16)

	K. Correspondence relating to any violations, waivers, consents and releases from any restrictive covenants.	See IV.B

	L. Material correspondence with any current creditor of the Company.	See IV.B Signed payoff – Hana 7-7-10 (3.35) C3 Letter – 2010.05.05 (3.30)

	M. Compliance certificates, including borrowing base certificates and covenant compliance calculations, supplied by the Company to any creditor.	See III.G

	N. Lien searches or other evidences as to outstanding financing statements or other notices of liens.	UCC Report (3.3) LMC UCC Term – calif_20100716144119 (3.36) LMC UCC Term – alab_20100716144041 (3.37)

IV.	LITIGATION AND CONTINGENT LIABILITIES

	A. Summary of any known contingent liabilities or material commitments of the Company, excluding any liabilities or commitments that individually involve an amount less than $10,000.	None

APPLE CONFIDENTIAL

		Notes

	B. List and description of all concluded, pending or threatened litigation (to the extent such threatened litigation is known to the Company), governmental proceedings, investigations, arbitration proceedings, orders, judgments, or other potential claims, disputes, investigations or proceedings relating to the Company’s employees, but only to the extent that any such matters were pending at any time since January 1, 2005.	Schedule IV.B (4.7) SanDisk Payoff (4.1) Sandisk release 6-10 (4.4)

	Provide the correspondence regarding any pending or threatened suits, actions, proceedings or governmental actions, proceedings or inquiries; copies of initial pleadings (complaint, answer, demurrers) and any judgments, decrees or orders to which the Company is bound or by which any of the Company’s business practices are restricted. If there are matters you have previously listed or materials you have already provided in response to another section that would also fall into this section, you may cross reference that section.	Hana Final Judgment (4.2) Caltech – 2010.04 (4.3) Caltech – Fisher-Adams, Grace – 2010.06.25 (4.5) SanDisk Termination of Lien – Filed 2010.06.14 (4.6)

	C. List and description of all pending or threatened government or other investigations relating to the Company and provide all reports to, notices from, or correspondence, from the prior five fiscal years and the current fiscal year.	None

	D. All attorneys’ letters to accountants relating to pending or threatened litigation or other contingencies relating to the Company for the past three years.	See IV.B

	E. Any existing opinions of or correspondence with counsel as to pending litigation involving the Company.	None

	F. All management letters from the Company’s independent registered public accounting firm to the Company concerning internal accounting procedures or controls in connection with the current audit and any other audit conducted in the past five years.	None

	G. Correspondence concerning inquiries from governmental (i) tax authorities, or (ii) authorities regarding equal opportunities violations, antitrust violations, or violations of any other law, rule or regulation.	Notice on payroll tax delinquency_LMT (9.8) Notice on remaining payroll tax due (9.11)

	H. Any settlement documentation regarding any of the foregoing.	See IV.B, G Landlord Rent Settlement (4.8)

V.	COMPLIANCE WITH LAWS

	A. All inspection or regulatory reports, citations and notices received from government agencies or self-regulatory organizations relating to the Company.	None

	B. List of all material governmental permits, franchises, licenses, clearances, permissions and approvals relating to the Company (collectively, “Permits”), together with information regarding any such Permits which have been canceled or terminated, required to carry out the business or operations of the Company, including such Permits required by foreign, federal, provincial or local authorities, and any evidence of exemption from such permit or license requirement. Copies of all Permits.	None

	C. All correspondence with any third party who has alleged unfair competition by the Company.	None

APPLE CONFIDENTIAL

		Notes

	D. List of all pending or contemplated disputes, proceedings, requests for information or other actions or activities affecting or relating to any Permit.	None

	E. Provide details of all pending or completed governmental audits, cases, etc. for the last three years and identify the governing country in each such case.	None

VI.	MATERIAL CONTRACTS

	A. Copies of all contracts with customers, suppliers and any other third parties pursuant to which the Company would expect to receive or pay more than $100,000 over the life of the contract.	LQMT – LLPG, Inc. License Agreement – 2003 (6.10) LQMT – LLPG License Agreement – First Amended (6.4) LLPG Letter – Final Signed (6.21) LQMT – GM License Agreement (6.5) GM Letter – Final Signed (6.23) LQMT – LSI License Agreement (6.6) LQMT – The Swatch Group License Agreement (made available at LQMT’s office in RSM, California) LLPG Amendment Letter – 2010.07.29 (6.22)

	B. Research and development agreements.	ENGEL_Machinery_Inc_LiquideMetal_Technologies_Inc_Agreement – 2010.02.04 (6.1)

	C. Technical cooperation agreements.	See VI.B

	D. Copies of all outstanding and unfulfilled purchase orders.	See VI.E as examples LMT Outstanding Vendor PO’s – 2010.06.14 (6.18) LMC Outstanding Vendor PO’s – 2010.06.14 (6.19)

	E. Samples of all forms of purchase orders, invoices, etc.	Example of Customer Quotation and PO’s – Asulab (6.13) Example of Customer Quotation and PO – Biolase (6.14) Example of Customer Quotation and PO’s – Cochlear (6.15) Example of Vendor PO – TAFA (6.16) Example of Vendor PO – Powder Alloy Corp (6.17)

	F. Copies of any joint venture, joint development, partnership or other type of strategic agreement.	LSI JV Agreement (6.9) LMCSl Joint Venture Agreement – 2010.05.04 (6.12)

	G. Copies of all agreements with distributors, dealers and sales representatives.	None

	H. Any documents relating to current investments in other companies or entities, acquisitions of companies, assets or disposition of assets.	See I.D. for LMC documents and VI.F

APPLE CONFIDENTIAL

		Notes

	I. Copies of any other contracts, agreements or documents that the Company believes is material to the business.	LQMT – Caltech License Agreement (6.3) Gyeonghi Land lease (6.20)

		See VI.A

	J. Copies of any term sheets, letters of intent, or similar documents relating to any pending transaction that involves an amount in excess of $10,000.	LQMT – WC Heraeus LOI 05.11.10 (6.11)

VII.	HUMAN RESOURCES – BACKGROUND

	A. Company Workforce

	1 . Organizational chart of the Company, including titles and locations.	LQMT – Org Charts (7.1)

	2. Current roster of employees providing services in connection with the conduct of the Company’s business by location, including job title, full-time/part-time/temporary status, department and start date.	Employee List (7.4) Employee List – Updated – 2010.07.08 (7.7) Employee Resignations and Terminations (7.5) LMC – Temporary Employees (7.6)

	3. List of all independent contractors/consultants/agents providing services in connection with the conduct of the Company’s business and rate of compensation and other benefits (including option information) and location.	Schedule VII.A.3 (7.3)

	4. Listing of employees providing services in connection with the conduct of the Company’s business who require immigration sponsorship by office and department, current type of work authorization and country of origin.	Schedule VII.A.4 (7.8)

VIII.	FINANCIAL STATEMENTS

	A. All financial statements and related reports, including balance sheets, for the last three years and any interim period prepared for the Company. [Refer to SEC filings.]	Draft 10-K (8.1) 2009 10-K Updated Draft (8.10)

	B. Description of any known liability not revealed in the financial statements described in XII(A) above.	None

	C. List of any off balance sheet liabilities not appearing in most recent annual financial statement (including the notes thereto).	None

	D. Accounts receivable aging report, including customer names, as of the close of the last calendar month.	AR Customer List 4-30-10 (8.3) AR Customer List 6-30-10 (8.2)

	E. Accounts payable aging report, including vendor or supplier name, as of the close of last calendar month.	AP List 4-30-10 (8.4) AP List 6-30-10 (8.7)

	F. Accounts payable and accrued expenses detail by category.	Provided to D&T

	G. Schedule of all inventory.	Inventory 4-30-10 (8.5) Inventory 6-30-10 (8.8)

	H. Fixed Assets ledger identifying asset, date of acquisition, purchase price, depreciation period/useful life, and book value as of most recent balance sheet date.	Fixed asset list 4-30-10 (8.6) Fixed asset list 6-30-10 (8.9)

APPLE CONFIDENTIAL

		Notes

	I. Any applicable U.S. Sarbanes-Oxley Act testing and compliance materials and documentation.	None

	J. Summary of all accounting policies and procedures, detailing reserve methodologies and accounting methods. Detail should include, at a minimum, the following policies: accounts receivable reserve policy, bonus policy, commission policy, fixed asset capitalization policy (lives and capitalization limits), inventory reserve policy, revenue recognition policy, sales returns policy, vacation policy and warranty policy.	Draft 10-K (8.1) 2009 10-K Updated Draft (8.10)

IX.	TAX MATERIALS

	A. For prior five years, provide the following:



	1 . Listing of all office locations	Schedule IX.A.l (9.12)



	2. Bulk sales returns for any major asset sale	None

APPLE CONFIDENTIAL

			Notes

	B. For most recent five years:
	1 . Federal and state income tax returns		LMT Federal Income Tax Return 2004 (9.15) LMT Federal Income Tax Return 2005 (9.14) LMT Federal Income Tax Return 2006 (9.6) LMT Federal Income Tax Return 2007 (9.5) LMT Fed tax 2008 – Final (9.30) (supersedes LMT Federal Income Tax Return 2008 – draft (9.10)) LMC – Income Tax – 2007 (9.13) LMC – Income Tax – 2008 (9.3) (supersedes LMC – Income Tax – 2008 (draft) (9.4)) LMC – Income Tax 2009 (9.1) LMT CA Tax – 2007 (9.21) LMT CA Tax – 2006 (9.16) LMT CA Tax – 2005 (9.19) LMT CA Tax – 2004 (9.20) LMT CA Tax – 2003 (9.22) LMT TX Tax 2007 (9.29) LMT TX Tax 2006 (9.28) LMT TX Tax 2005 (9.27) LMT TX Tax 2004 (9.26) LMT TX Tax 2003 (9.25) LMC AL Tax 2007 (9.32) LMC AL Tax 2008 (9.33) LMC AL Tax 2009 (9.34)

			LMTK Tax return 2009 (9.17) LMTK Tax return 2008 (9.18) LMTK Tax 2007 (9.23)

	2. foreign income tax returns		LMTK Tax 2006 (9.24) LMTK Tax 2005 (9.31)

	C. For prior two years, provide the following:

	1 . List of all individuals providing services to the Company receiving W-2s		See VII.A.2

	2. List of all 1099 Recipients providing services to the Company		LMT 1099 Consultants (9.2)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2010

OR

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Delaware		33-0264467
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

PART I - Financial Information

Item 1 – Financial Statements	4
Condensed Consolidated Balance Sheets (unaudited)	4
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (unaudited)	5
Condensed Consolidated Statements of Shareholders’ Deficiency (unaudited)	6
Condensed Consolidated Statements of Cash Flows (unaudited)	7
Notes to Condensed Consolidated Financial Statements (unaudited)	9

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	23

Item 3 – Quantitative and Qualitative Disclosures about Market Risk	28

Item 4 – Controls and Procedures	28

PART II – Other Information

Item 1 – Legal Proceedings	29

Item 1A – Risk Factors	29

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds	29

Item 3 – Defaults Upon Senior Securities	29

Item 4 – Removed and Reserved	29

Item 5 – Other Information	29

Item 6 – Exhibits	29

Signatures	31

	September 30,			December 31,
	2010			2009
	(unaudited)
ASSETS

Current assets:
Cash and cash equivalents	$	3,157		$	151
Trade accounts receivables, net of allowance for doubtful accounts of $0 and $1,314		1,142			1,180
Inventories		948			982
Prepaid expenses and other current assets		731			594
Total current assets		5,978			2,907

Property, plant and equipment, net		5,168			5,668
Other intangibles, net		1,156			1,232
Other assets		390			633
Total assets		12,692			10,440

LIABILITIES AND SHAREHOLDERS' DEFICIENCY

Current liabilities:
Accounts payable and accrued expenses		6,452			9,111
Deferred revenue		39			31
Short-term debt		415			896
Long-term debt, current portion		-			1,393
Warrant liabilities		26,786			3,975
Conversion feature liabilities		-			444
Other liabilities, current portion		133			141
Total current liabilities		33,825			15,991

Long-term debt, net of current portion		9,850			12,661
Other long-term liabilities, net of current portion		647			155
Total liabilities		44,322			28,807

Shareholders' deficiency:
Liquidmetal Technologies, Inc. shareholders' deficiency
Preferred stock, $0.001 par value; 10,000,000 shares authorized; 2,486,095 and 3,183,663 shares issued and outstanding as of both September 30, 2010 and December 31, 2009		3			4
Common stock, $0.001 par value; 300,000,000 shares authorized; 84,763,338 and 47,583,102 shares issued and outstanding as of both September 30, 2010 and December 31, 2009		79			48
Additional paid-in capital		147,120			142,135
Accumulated deficit		(180,827	)		(162,777	)
Accumulated other comprehensive income		1,442			1,441
Total Liquidmetal Technologies, Inc. shareholders' deficiency		(32,183	)		(19,149	)
Noncontrolling interest		553			782
Total shareholders' deficiency		(31,630	)		(18,367	)

Total liabilities and shareholders' deficiency	$	12,692		$	10,440

	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2010			2009			2010			2009

Revenue	$	17,309		$	4,209		$	22,213		$	11,320
Cost of sales		1,604			2,909			5,376			6,945

Gross profit		15,705			1,300			16,837			4,375

Operating expenses
Selling, general, and administrative		2,444			1,341			5,088			4,286
Research and development		331			349			804			897
Total operating expenses		2,775			1,690			5,892			5,183

Income (loss) from operations		12,930			(390	)		10,945			(808	)

Loss from extinguishment of debt		-			-			-			(1,471	)
Change in value of warrants, (loss) gain		(27,199	)		2,015			(24,361	)		8,138
Change in value of conversion feature, gain		15			474			444			1,434
Other income		18			-			81			-
Interest expense		(2,504	)		(1,055	)		(5,053	)		(4,760	)

Net (loss) income before income taxes		(16,740	)		1,044			(17,944	)		2,533

Income taxes		-			(75	)		-			(120	)

Net (loss) income		(16,740	)		969			(17,944	)		2,413

Net loss attributable to noncontrolling interest		114			39			250			59

Net (loss) income attributable to Liquidmetal Technologies, Inc.		(16,626	)		1,008			(17,694	)		2,472

Other comprehensive (loss) income:
Foreign exchange translation gain		108			393			1			316
Comprehensive (loss) income	$	(16,518	)	$	1,401		$	(17,693	)	$	2,788

Per common share basic and diluted:
Net (loss) income attributable to Liquidmetal Technologies, Inc. - basic	$	(0.23	)	$	0.02		$	(0.31	)	$	0.05
Net (loss) income attributable to Liquidmetal Technologies, Inc. - diluted	$	(0.23	)	$	0.01		$	(0.31	)	$	0.01

Number of weighted average shares - basic		72,928			46,595			56,329			45,610
Number of weighted average shares - diluted		72,928			192,404			56,329			191,418

	Liquidmetal Technologies, Inc.
	Preferred Shares			Common Shares		Preferred Stock			Common Stock		Additional Paid-in Capital			Accumulated Deficit			Accumulated Other Compre- hensive Income (Loss)		Non- controlling Interest			Total

Balance, December 31, 2009		3,183,663			47,583,102		4			48		142,135			(162,777	)		1,441		782			(18,367	)
Conversion of preferred stocks		(697,568	)		17,219,681		(1	)		17		(16	)		-			-		-			-
Conversion of warrants		-			4,849,775		-			5		2,547			-			-		-			2,552
Restricted shares issued		-			13,870,307		-			8		2,038			-			-		-			2,046
Common stock issued in lieu of cash		-			907,141		-			1		116			-			-		-			117
Conversion of notes payable		-			333,332		-			-		200			-			-		-			200
Dividends		-			-		-			-		-			(356	)		-		-			(356	)
Minority interest contribution in a subsidiary		-			-		-			-		-			-			-		21			21
Stock-based compensation		-			-		-			-		100			-			-		-			100
Foreign exchange translation gain (loss)		-			-		-			-		-			-			1		-			1
Net ( loss)		-			-		-			-		-			(17,694	)		-		(250	)		(17,944	)
Balance, September 30, 2010		2,486,095			84,763,338		3			79		147,120			(180,827	)		1,442		553			(31,630	)

	For the Nine Months Ended September 30,
	2010			2009

Operating activities:
Net (loss) income attributable to Liquidmetal Technologies, Inc.	$	(17,694	)	$	2,472

Adjustments to reconcile loss (income) from operations to net cash provided for (used in) operating activities:
Gain on disposal of asset		51			-
Loss attributable to noncontrolling interest of consolidated subsidiary		(250	)		(59	)
Depreciation and amortization		868			772
Loss on extinguishment of debt		-			1,471
Amortization of debt discount		3,522			2,633
Stock-based compensation		101			262
Bad debt expense		61			29
Warranty recovery		(176	)		(92	)
Loss (gain) from change in value of warrants		24,361			(8,138	)
Gain from change in value of conversion feature		(444	)		(1,434	)

Changes in operating assets and liabilities:
Trade accounts receivable		(22	)		(142	)
Inventories		35			(292	)
Prepaid expenses and other current assets		(137	)		(240	)
Other assets		(52	)		(306	)
Accounts payable and accrued expenses		(2,018	)		1,213
Deferred revenue		8			11
Other liabilities		485			(14	)
Net cash provided by (used in) operating activities		8,699			(1,854	)

Investing Activities:
Purchases of property and equipment		(190	)		(412	)
Investment in patents and trademarks		(29	)		(277	)
Net cash used in investing activities		(219	)		(689	)

Financing Activities:
Proceeds from borrowings		9,563			13,747
Repayment of borrowings		(17,274	)		(26,520	)
Proceeds from issuance of convertible preferred stocks		-			15,328
Proceeds from issuance of comon stocks		2,046			-
Warrants exercised		1,002			-
Cash distributions		-			(9	)
Minority interest in subsidiary's joint venture		21			-
Net cash (used in) provided by financing activities		(4,642	)		2,546
Effect of foreign exchange translation		(832	)		(39	)
Net increase (decrease) in cash and cash equivalents		3,006			(36	)

Cash and cash equivalents at beginning of period		151			157
Cash and cash equivalents at end of period	$	3,157		$	121

Level 1 —	Quoted prices in active markets for identical assets or liabilities;

Level 2 —	Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3 —	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

	Level	September, 2010		December 31, 2009
Warrant Liabilities	2	$	26,786	$	3,975
Conversion Feature Liabilities	2	$	-	$	444

	Coatings			Bulk Alloy		Segment Totals
Three months ended September 30, 2010
Revenue to external customers	$	1,839		$	15,470	$	17,309
Gross profit		671			15,034		15,705
Total segment (loss) income		(311	)		14,652		14,341
Total identifiable assets at end of period		2,406			6,718		9,124

Three months ended September 30, 2009
Revenue to external customers	$	2,041		$	2,168	$	4,209
Gross profit		693			607		1,300
Total segment (loss) income		(124	)		156		32
Total identifiable assets at end of period		2,534			9,137		11,671

Nine months ended September 30, 2010
Revenue to external customers	$	6,383		$	15,830	$	22,213
Gross profit		2,224			14,613		16,837
Total segment (loss) income		(754	)		13,881		13,127
Total identifiable assets at end of period		2,406			6,718		9,124

Nine months ended September 30, 2009
Revenue to external customers	$	6,234		$	5,086	$	11,320
Gross profit		2,198			2,177		4,375
Total segment (loss) income		(271	)		1,013		742
Total identifiable assets at end of period		2,534			9,137		11,671

	For the Three Months						For the Nine Months
	Ended September 30,						Ended September 30,
	2010			2009			2010			2009

Total segment income	$	14,341		$	32		$	13,127		$	742
General and administrative expenses, excluded		(1,755	)		(738	)		(3,132	)		(2,503	)

Consolidated income (loss) before interest, income taxes, and noncontrolling interests	$	12,586		$	(706	)	$	9,995		$	(1,761	)

Loss from extinguishment of debt		-			-			-			(1,471	)
Change in value of warrants, (loss) gain		(27,199	)		2,015			(24,361	)		8,138
Change in value of conversion feature, gain		15			474			444			1,434
Interest expense		(2,142	)		(739	)		(4,022	)		(3,807	)
Income taxes		-			(75	)		-			(120	)
Income attributable to noncontrolling interest		114			39			250			59
Consolidated net loss attributable to Liquidmetal Technologies, Inc.	$	(16,626	)	$	1,008		$	(17,694	)	$	2,472

	September 30,
	2010

Total segment assets	$	9,124
Cash and cash equivalents		3,028
Prepaid expenses and other current assets		292
Other property, plant and equipment		44
Intangibles, net		-
Other assets		204
Total consolidated assets	$	12,692

Exhibit
Number		Description of Document

3.1		Amended and Restated Certificate of Designations, Preferences and Right, dated November 2, 2010, between Liquidmetal Technologies, Inc. and holders of the Series A-1 Preferred Stock and holders of the Series A-2 Preferred Stock.

10.1		Employment Agreement, dated August 3, 2010, between Thomas Steipp and Liquidmetal Technologies, Inc.

10.2		Restricted Stock Agreement, dated August 3, 2010, between Thomas Steipp and Liquidmetal Technologies, Inc.

10.3*		Master Transaction Agreement, dated August 5, 2010, between Apple Inc., Liquidmetal Technologies, Inc., Liquidmetal Coatings, LLC and Crucible Intellectual Property, LLC.

10.4		Subscription Agreement, dated August 10, 210, between Liquidmetal Technologies, Inc. and Norden LLC.

10.5		Consent Agreement between Liquidmetal Technologies, Inc. and holders of the Series A-1 Preferred Stock and holders of the Series A-2 Preferred Stock.

31.1		Certification of Principal Executive Officer, Thomas Steipp, as required by Section 302 of the Sarbanes-Oxley Act of 2002

31.2		Certification of Principal Financial Officer, Tony Chung, as required by Section 302 of the Sarbanes-Oxley Act of 2002

32.1		Certification of Principal Executive Officer, Thomas Steipp, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2		Certification of Principal Financial Officer, Tony Chung, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

*		Portions of this exhibit have been omitted pursuant to a confidential treatment request. Omitted information has been filed separately with the Securities and Exchange Commission

	LIQUIDMETAL TECHNOLOGIES, INC.
	(Registrant)

Date: November 4, 2010	/s/ Thomas Steipp
	Thomas Steipp
	President and Chief Executive Officer
	(Principal Executive Officer)


Date: November 4, 2010	/s/ Tony Chung
	Tony Chung
	Chief Financial Officer
	(Principal Financial and Accounting Officer)

COMPANY :		PARTICIPANT :

LIQUIDMETAL TECHNOLOGIES, INC., a Delaware corporation

By:	/s/ Ricardo Salas	/s/ Thomas Steipp

Print Name:	Ricardo Salas	THOMAS STEIPP
Print Title:	Executive Vice President

Name:
Spouse’s Name:
Address:
City, State, Zip:
Soc. Sec. Number:
Spouse’s Soc. Sec. Num:

TRANSFEREE:	Thomas Steipp, a resident of California (“Transferee”)

ISSUER:	Liquidmetal Technologies, Inc., a Delaware corporation

SECURITY:	6,000,000 shares of Common Stock (the “Shares”)

DATE:	August ____, 2010

1.	LMT Technology	1

2.	Transaction Approvals	5

3.	LMT-SPE Formation	6

4.	LMT Technology Transfers to LMT-SPE	7

5.	LMT Patent Prosecution	9

6.	LMT-SPE Existence and Separateness	13

7.	Due Diligence	16

8.	LMT Indebtedness and Liens	17

9.	LMT-SPE Licenses	18

10.	Covenant Not to Compete	21

11.	Confidentiality	23

12.	Independent Contractor	24

13.	Indemnification	24

14.	Term, Termination and Suspension of Performance	25

15.	Guaranty	27

16.	Miscellaneous	29

	Annex 1:	Permitted Liens
	Annex 2:	Approvals
	Annex 3:	LMC Assignment Agreement
	Annex 4:	LMT Contribution Agreement
	Annex 5:	Form of Payoff Letter
	Annex 6:	Apple License
	Annex 7:	LMT License
	Annex 8:	LMC License
	Annex 9:	Technology Development Agreement
	Annex 10:	LMT Security Agreement
	Annex 11:	LMT-SPE Security Agreement
	Annex 12:	Form of Release
	Annex 13:	Patent Counsel Engagement Letter
	Annex 14:	Due Diligence Checklist
	Annex 15:	List of Excluded LMC Patents and Trademarks

Agreement	Introduction
Apple	Introduction
Apple License Agreement	9(a)
Apple-Related Entities	9 (f)
Approval	2(b)(iii)
business enterprise	6(j)
Caltech	1(e)
Caltech License	1(e)
Capture Period	1(a)(iv)
Closing Date	1(a)(i)
Consumer Electronic Products	10(a)
Due Diligence Checklist	7(a)
Guaranty	15(b)
indemnified party	13(a)
Intellectual Property	1(a)(ii)
Intellectual Property Rights	1(a)(iii)
Lien	1(b)(i)
LMC	Introduction
LMC License Agreement	9(c)
LMT	Introduction
LMT Controlled Patents/Applications	5(h)
LMT Fundamental Breach	14(e)
LMT License Agreement	9(c)
LMT-SPE Fundamental Breach	14(f)
LMT-Subs	15(a)
LMT Technology	1(a)(i)
Patent Counsel	5(c)
Prosecution and Maintenance Costs	5(b)
Transaction Documents	1(b)(viii)

APPLE INC.		LIQUIDMETAL TECHNOLOGIES, INC.

		/s/ Larry Buffington
Name:	/s/ Zadesky	Name:	LARRY BUFFINGTON
Title:	VP Product Design	Title:	PRESIDENT/CEO
Date:	8/5/10	Date:	8/10/2010

Address:	1 Infinite Loop	Address:	30452 Esperanza
	Cupertino, CA 95014		Rancho Santa Margarita, CA
Attn:		92688
		Attn:

		LIQUIDMETAL COATINGS, LLC

		/s/ Larry Buffington
		Name:	LARRY BUFFINGTON
		Title:	PRESIDENT/CEO
		Date:	8/10/2010

		Address:	900 Rockmead Drive, Suite 240
			Kingwood, Texas 77339
		Attn:	Chief Executive Officer

		CRUCIBLE INTELLECTUAL PROPERTY, LLC

		/s/ Tony Chung
		Name:	Tony Chung
		Title:	Chief Financial Officer

	Date:	8/4/10

	Address: 31441 Santa Margarita Pkwy., Suite A #247
	Rancho Santa Margarita, CA 92688 92688

	Attn:	Chief Executive Officer

	ASSIGNOR:
	LIQUIDMETAL COATINGS, LLC

	By:	/s/ Larry Buffington
	Name:	LARRY BUFFINGTON
	Title:	PRESIDENT / CEO

	ASSIGNEE:
	LIQUIDMETAL TECHNOLOGIES, INC.

	By:	/s/ Tony Chung
	Name:	Tony Chung
	Title:	Chief Financial Officer

Grantor	Patent	Country	Date Filed	Serial No.	Patent No./Status	Issue Date
Liquidmetal Coatings, LLC	Nickel Based Thermal Spray Powder	USA	2/1/10	61,300,318	Pending	—
Liquidmetal Coatings, LLC	Molybdenum- Containing Ferrous Alloy for Improved Thermal Spray Deposition and Hard-Facing	USA	4/28/10	61,315,661	Pending	—

Liquidmetal Technologies, Inc. (“LMT”)		WC Collateral Agent LLC
30452 Esperanza		450 Seventh Avenue, Suite 509
Rancho Santa Margarita, CA 92688		New York, NY 10123
Attention: Tony Chung		Attention: Dwight Mamanteo
(“ tony.chung@liquidmetal.com )		(dwight@wynnefieldcapital.com)

Bank Name:
Bank Address:
Bank Phone #:
Account Name:
Swift code:
Routing #:
Account #:

ACKNOWLEDGED AND AGREED TO:

LIQUIDMETAL TECHNOLOGIES, INC.

By
	Name:
	Title:

APPLE:		CRUCIBLE INTELLECTUAL
		PROPERTY, LLC:



By:	/s/ Zadesky	By:	/s/ Tony Chung
Name:	Zadesky	Name:	Tony Chung
Title:	VP Product Design	Title:	Chief Financial Officer
Date:	8/5/10	Date:	8/4/10

Address:	MS 301-4GC	Address:	31441 Santa Margarita Pkwy.
	1 Infinite Loop		Suite A #247
	Cupertino, CA 93014		Rancho Santa Margarita, CA
Attn:	General Counsel		92688
		Attn:	Chief Executive Officer

LIQUIDMETAL TECHNOLOGIES, INC.:		CRUCIBLE INTELLECTUAL PROPERTY, LLC:



By:	/s/ Larry Buffington	By:	/s/ Tony Chung
Name:	LARRY BUFFINGTON	Name:	Tony Chung
Title:	PRESIDENT / CEO	Title:	Chief Financial Officer
Address:	30452 Esperanza	Address:	31441 Santa Margarita Pkwy.,
	Rancho Santa Margarita, CA		Suite A #247
	92688		Rancho Santa Margarita, CA
Attn:	Chief Executive Officer		92688
		Attn:	Chief Executive Officer

		Notes

I.	GENERAL CORPORATE MATERIALS

	A. List of assumed names, division names or other names under which the Company is conducting or has conducted business.	Schedule I.A ( 1.19)

	B. List of all jurisdictions in which the Company (i) owns, stores, leases or licenses properties or assets, (ii) has employees, agents or customers, (iii) is qualified to do business or (iv) conducts business. Provide evidence of qualification to do business where material, where property interests are held or where the Company’s business is otherwise conducted.	Schedule I.B (1.20)

	C. List of all present and former subsidiaries of the Company, including the name and address of such subsidiary’s headquarters (including entities in which the Company own less than 100%).	Schedule I.C (1.3)

	D. A copy of the charter documents and bylaws with all amendments to date of the Company.	Delaware Corporate Bylaws (1.1) Delaware Filing (1.2) LMC – Operating Agreement – 2007 (1.8) LMCS – Operating Agreement – 2007 (1.9) LMC – Operating Agreement – First Amendment – 2008 (1.10) LMC – Operating Agreement – Amendment – Oct 2009 (1.21) LMC – Operating Agreement – Amendment Apr 2010 (1.15) LMG – Articles of Incorporation (1.11) LMG – Bylaws (1.12)

	E. List of directors and officers of the Company.	Schedule I.E. (1.4)

		Notes

	D. Detail of recent tax notices, including taxing authority, issues status of resolution.	Schedule of Tax Due (9.7) Notice on payroll tax delinquency_LMT (9.8) Notice on remaining payroll tax due (9.11) Federal Tax Receipt (9.9)

	E. Description of any pending or potential issues with tax authorities (including a list of all tax examinations currently in process). Copies of all notices, assessments, deficiencies, or adjustments (proposed or final), and any agents’ or examiners’ reports received by the Company.	See IX.D

	F. Detail of audits including taxing authority, issues raised and status. For closed audits, a copy of closing agreement.	None

	G. Any correspondence with tax authorities regarding disputed amounts or positions within the last 4 years.	None

	H. Deficiency assessments filed against the Company by federal, state or local tax authorities and the resolution of such deficiency (if any).	See IX.D

	I. Any agreements waiving or extending the statute of limitation for deficiency assessments or in connection with federal, state or local tax matters.	None

	J. Closing letters and any other material IRS documents and tax assessment documents including, for example, rulings obtained and accounting method changes applied for.	None

	K. Schedule of taxes payable by the Company.	Schedule of Tax Due (9.7)

	L. List of jurisdictions where indirect tax returns are filed and a copy of all returns filed for the last 12 months.	None

	M. All intercompany tax sharing or tax indemnification agreements.	None

	N. Details on any governmental, public or private entities providing incentives, assistance or loans programs in which the Company has participated.	None

X.	CUSTOMER, MARKETING AND OTHER BUSINESS MATTERS

	A. Customer Matters:	LQMT – List of Customers (10.1)

	1. List of all active customers and customers for the previous two years,.	LMC – Top Material Customers – 2009-10 (10.5)

	2. Copies of active customer agreements and commitments.	See VI.E. as example

	3. Summary of bad debts, accounts receivable summary detailing account balances and reserves, accounts receivable aging.	Bad Debts 4-30-10 (10.11) Bad Debts 6-30-10 (10.13)

			Notes

	B. Marketing Arrangements:

	1 . All agreements or arrangements related to the research, development, manufacturing, testing, marketing, etc. of the Company’s products, such as joint development agreements, partnership agreements, agency agreements, manufacturer representation agreements technology exchange agreements, agreements with suppliers and vendors, agreements with subcontractors and component parts manufacturers, agreements with testing laboratories, agreements with foundries or similar agreements.		See VI.B Liquidmetal EMI MOU (10.4) HEAD Sports Agreements (10.2)

	2. Listing of all co-branding, private label, alliance, joint venture, partnerships, co-marketing, distribution, content syndication, licensing, equity or debt relationships, or similar agreements with other companies used by the Company. Copies of all joint venture, co-branding and joint marketing agreements (including any side letters or oral agreements).		See VI.A and F, X.B.1

	3. Copies of all contracts with any municipality, state or federal government.		SBIR NO4-168 (10.3)

	4. Copies of all standard Company sales forms or literature, including price lists.		See VI.E

	5. List and general description of commission or other compensation arrangements with sales personnel.		Schedule X.B.5 (10.14) LMC Sales Employment Agreement May 2009 (10.7)

	C. Other Business Matters:

	1 . Copies of all product warranties and listing of warranty claims, reserves and expenses.		Warranty Accrual 4.30.10 (10.10) Warranty Accrual 6.30.10 (10.12)

	2. Any agreement or arrangement (whether written or unwritten or intended to be legally enforceable or not) restricting or that may restrict the business activities or sale of any assets of the Company (including but not limited to non-competition, exclusive territory, non-solicitation, non-disclosure or other similar restrictions).		See VI.1 – Specifically the following; LQMT – LLPG, Inc. License Agreement – 2003 (6.10) LQMT – LLPG License Agreement – First Amended (6.4) LLPG Letter – Final Signed (6.21) LQMT – GM License Agreement (6.5) GM Letter – Final Signed (6.23) LQMT – LSI License Agreement (6.6) LQMT – The Swatch Group License Agreement (made available at LQMT’s office in RSM, California)

	3. A list of the Company’s major suppliers.		Top Supplier List (10.9)

	4. Standard customer credit terms and any significant variations in practice.		Schedule X.C.4 (10.6) Standard Sales Terms (10.8)

			Notes

	5. License, sublicense, royalty and franchise agreements involving the Company.		See VI.1 – Specifically the following: LQMT – LLPG, Inc. License Agreement – 2003 (6.10) LQMT– LLPG License Agreement – First Amended (6.4) LLPG Letter – Final Signed (6.21) LQMT – GM License Agreement (6.5) GM Letter – Final Signed (6.23) LQMT – LSI License Agreement (6.6) LQMT – The Swatch Group License Agreement (made available at LQMT’s office in RSM, California)

	6. All material commitments, contracts and/or agreements, or those currently under consideration or negotiation (and the status of negotiation) relating to the Company.		See VI.l – Specifically the following: LQMT – LLPG, Inc. License Agreement – 2003 (6.10) LQMT – LLPG License Agreement – First Amended (6.4) LLPG Letter – Final Signed (6.21) LQMT – GM License Agreement (6.5) GM Letter – Final Signed (6.23) LQMT – LSI License Agreement (6.6) LQMT – The Swatch Group License Agreement (made available at LQMT’s office in RSM, California) LMCSI Joint Venture Agreement – 2010.05.04 (6.12) LQMT – WC Heraeus LOI 05.11.10 (6.11)

	7. Hold-harmless, indemnification or similar agreements of the Company (or provisions within agreements).		See VI

	8. Any agreement out of the ordinary course of business to which the Company is a party or by which it or its properties are bound as it relates to the conduct of the Company’s business.		None

	9. A list of all agreements affected in any manner by a change in control of the Company or which require consent or notice of a third party to assignment (please provide copies of such agreements to the extent not covered by a request above).		LMC Operating Agreement – 2007 (1.8)

	10. Summary of pending claims for indemnification under any contract.		None

	11. All related party agreements, including all documents pertaining to any receivables from or payables to employees or beneficial owners of more than 5% of the Company’s stock.		Draft 10-K (8.1) 2009 10-K Updated Draft (8.10)