LQMT schedule 13 D/A

First, let’s start with the backstory for my long-term position in LQMT stock.

Apple’s Involvement

In August 2010, Apple entered into a licensing agreement with Liquidmetal Technologies, granting Apple exclusive rights to use Liquidmetal's amorphous metal alloys in consumer electronics. This deal allowed Apple to leverage Liquidmetal's materials, known for their high strength, corrosion resistance, and unique atomic structure, in its products.

The initial agreement was valued at $20 million and included a perpetual, worldwide, fully-paid, exclusive license for Apple to commercialize Liquidmetal's intellectual property in consumer electronics. In return, Liquidmetal retained rights to use its technology in other industries.

Over the years, Apple has extended this agreement multiple times, indicating ongoing interest in Liquidmetal's technology. For instance, in 2015, Apple extended the deal through February 2016.

Despite these extensions, Apple's use of Liquidmetal in consumer products has been limited. One known application is the SIM card ejector tool included with certain iPhone models.

As of November 2024, there have been no significant announcements regarding Apple's broader implementation of Liquidmetal in its product lineup.

Source: ChatGPT

Eontec’s Involvement

Dongguan Eontec acquired a significant stake in Liquidmetal Technologies (LQMT) through multiple transactions:

- March 2016: Eontec purchased 105 million shares at $0.08 per share, totaling $8.4 million.

- Subsequent Closings: Eontec acquired an additional 300 million shares at varying prices—200 million shares at $0.15 per share and 100 million shares at $0.25 per share—amounting to $55 million.

These acquisitions resulted in Eontec holding approximately 405 million shares of LQMT. Given that LQMT had 914,449,957 shares outstanding as of April 30, 2021, Eontec's holdings represented about 44% of the company's shares at that time.

Source: ChatGPT

Lugee Li’s Involvement

As of March 23, 2023, Yeung Tak Lugee Li owned 60,027,000 shares of Dongguan Eontec representing 8.82% of the company's total shares. This made him the second-largest shareholder, following Zhuzhou State-Owned Asset Investment & Management Co., which held 25.35%.

As of October 10, 2024, Yeung Tak Lugee Li, a director and significant shareholder of Liquidmetal Technologies (LQMT), owned a total of 237,533,516 shares of the company's common stock. This total includes:

- Direct Ownership: 1,360,150 shares held directly by Mr. Li.

- Indirect Ownership: 225,212,112 shares held through Liquidmetal Technology Limited, a Hong Kong corporation where Mr. Li serves as the sole shareholder, executive officer, and director.

- Stock Options and Warrants:

- Options for 700,000 shares at an exercise price of $0.13.

- Options for 200,000 shares at an exercise price of $0.09.

- A warrant for 10,066,809 shares at an exercise price of $0.07.

Source: ChatGPT

Schedule 13D/A

The key points of this document are:

1. Purpose of Filing

- Schedule 13D/A is filed when a person or group acquires more than 5% of a company's shares or makes significant changes to their ownership or intentions regarding the securities.

- This filing reflects amendments to previously disclosed ownership stakes or intentions.

2. Ownership Details

- Yeung Tak Lugee Li, through Liquidmetal Technology Limited, owns or controls:

- 237,533,516 shares of common stock.

- This represents 25.6% of Liquidmetal Technologies outstanding shares (as of the filing date).

- Includes shares held directly, by a subsidiary, warrants, and options.

3. Recent Transaction

- Liquidmetal Technology Limited, owned by Lugee Li, sold 44,946,972 shares each to four different buyers via private Stock Purchase Agreements:

- Buyers:

- Lutos Capital, LLC

- Matana Ventures, LLC

- Parnas Hills, LLC

- XEX International, LLC

- Purchase Terms:

- Sale price: $0.16 per share.

- Total sale per buyer: $7,191,515.52.

- Payment method: Promissory notes with a term of 3 years at 5% annual interest.

4. Key Terms of Promissory Notes

- Principal repayment and interest are due at the note's maturity.

- If the loan defaults, interest rises to 15% annually.

- Payments are structured as balloon payments (i.e., full amount due at maturity).

5. Filing Justification

- Changes in share ownership due to these transactions triggered the need for this amendment.

- Lugee Li retains substantial control over the remaining shares of Liquidmetal Technologies.

6. Disclosures

- The filing includes details of:

- The Stock Purchase Agreements.

- Ownership interests.

- Terms of sale, purchase, and promissory notes.

7. Intentions of the Reporting Person

- No plans for further acquisition or major changes to Liquidmetal Technologies.

- Retains the right to acquire or dispose of additional shares.

Source: ChatGPT

Jason Bond’s Interpretation

Eontec makes door locks for Tesla. Liquidmetal makes sim cards for Apple. Lugee Li has significant stakes in both companies. Point here is LQMT stock is directly or indirectly connected to a few of the biggest companies in the world. If any headline emerges that either company does a new deal with LQMT the stock will go nuts. It went from about $.10 to $1.80 on the initial Apple investment.

What to make of four new funds taking down about $7.2M of stock each, at $.16, due in a few years as a balloon payment? Well, had been a secondary offering I would have considered it bad news and dilutive. However, the shares came from Lugee Li’s huge stack of chips, so it is NOT dilutive. So, through deductive reasoning, I surmise the four new funds will pay Li back by selling stock above $.16. That’s a lot of stock to sell above $.16 and given it’s not an actively traded stock something material would need to change for the market to absorb those shares at or above that price. What could move the stock like that? I can think of 100+ things when you have direct and indirect connections with Apple and Tesla. And those are just a few of the monstrous companies Eontec works with. The next question is when? We’ll the filing defines the time frame as three years but presumably sooner on the $.16+ as they are not going to sell the shares on the last day of year three, right? Basically could be anytime. Of course, or not at all and my interpretation is wrong. That said, my money is where my mouth is with a large core position in the stock and that I buy or sell without notice. I’ve been up huge on this trade and down huge. My thesis has long been that I get an exit, on the core shares, into a headline breakout like the initial Apple run from $.10 to the $1.80 level. Finally — while I’d love to get this off the table at a much higher level, I would certainly be happy at $.16+ too.

Bottom line. Four new funds coming in with substantial stakes at $.16 in direct connection to Li’s stake is bullish and possibly an indication the company is on the verge of something bigger. Time will tell.

Eat! Sleep! & Trade!

Jason Bond

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