Universal Display Corporation Extends and Expands Groundbreaking Business/Academic Partnership with Princeton University and the University Of Southern California.

Business Editors/Hi-Tech Writers

EWING, N.J.--(BUSINESS WIRE)--May 17, 2002

Unique Academic/Entrepreneurial Research Partnership Has Greatly

Advanced Organic Light Emitting Device (OLED) Progress Since 1994

Universal Display Corporation (UDC) (Nasdaq: PANL; PHLX: PNL), Princeton University, and the University of Southern California today announced the expansion and extension of their collaborative research agreement on advanced organic thin film devices, including organic light emitting devices (OLEDs) for flat panel displays, organic lasers, organic lighting and other areas of organic electronics through 2007.

This highly-productive research collaboration began with a three-year agreement in 1994 to develop OLED technology for flat panel displays, and was initially renewed for five years in 1997, when the two Universities became equity participants in Universal Display. This partnership has led to more than 58 issued patents and 56 pending patents in the US alone, plus numerous international patent applications related to OLEDs and other organic electronics technologies and applications. Under the terms of the agreement, Princeton and USC will continue to receive research funding to pursue an even wider range of goals in the development of advanced organic thin film technology for applications including displays, lasers, lighting, sensors and organic thin film transistors (TFTs).

Sherwin I. Seligsohn, Chairman of UDC, said, "Our collaboration with Princeton University and the University of Southern California remains one of the cornerstones of our strategy to bring organic electronics to their full commercial realization. It is an extremely successful partnership of brilliant and visionary academic researchers at Princeton and USC with creative, gifted and dedicated entrepreneurs, scientists and engineers at Universal Display. We place tremendous value on our unique entrepreneurial-academic partnership. This renewal and expansion of our agreement yet again is further testament to the great potential of organic electronics for displays, lasers, lighting, TFTs, sensors, memories and a host of electronic applications that can benefit from the low cost potential of organic technology, and seemingly endless opportunities for progress and success."

Dr. Stephen R. Forrest, the James R. McDonnell Distinguished University Professor, Electrical Engineering, at Princeton University and the leader of the University's OLED research team, said, "The progress we've made under our agreement is truly exciting and remarkable. In an area frought with potential minefields, the collaboration with UDC stands out as the model at the University for how these kinds of partnerships can best be structured, managed and succeed. This has proved to be an invaluable experience for professors, scientists and students."

Since the early days of the research partnership - one of the very first of its kind for Princeton University - research teams from Princeton and Universal Display have worked side-by-side at the University as an offshoot of the school's Center for Photonics and Optoelectronic Materials (POEM). Facilities have now evolved to the point where Universal Display has a 21,000 square foot facility near Princeton, including 4,000 feet of clean room space. In addition, the Company has commercial partnerships with companies such as Sony, Samsung SDI, PPG Industries and Aixtron AG.

OLEDs promise to bring brighter light, more vibrant colors and more efficient power consumption for a wide variety of uses, including flat panel displays in cell phones, laptop computers and television monitors. The flat panel display industry is valued at approximately $30 billion today and is expected to grow to $57 billion by 2006.

About Universal Display

Universal Display Corporation is a world leader in developing and commercializing innovative Organic Light Emitting Device (OLED) technologies. It is collaborating with a network of world-class organizations to penetrate the electronic flat panel display market, including its long-standing relationships for innovative OLED research with Princeton University and the University of Southern California. It also has a joint development agreement with Sony Corporation for the development of active matrix OLEDs using the Company's phosphorescent OLED technology for applications such as television monitors; a joint development agreement with Samsung SDI focusing on active matrix OLEDs for portable electronic devices; a strategic relationship for the commercialization and production of its proprietary high-efficiency OLED materials with PPG Industries, Inc. of Pittsburgh, PA, USA; and a partnership with AIXTRON AG of Aachen Germany for the development and production of the next generation of OLED production equipment using the Company's proprietary organic vapor phase deposition (OVPD) technology.

Universal Display Corporation is located in the Princeton Crossroads Corporate Center, Ewing, NJ. Its 21,000 sq. ft. facility includes a pilot production line, as well as technology development and technology transfer facilities. The state-of-the-art facility has been designed to further technology development, technology transfer to manufacturing partners and work with customers to develop products to meet their needs for electronic flat panel displays. Visit Universal Display Corporation on the Web at http://www.universaldisplay.com

All statements in this news release that are not historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, subject to risks and uncertainties that could cause actual results to differ materially for Universal Display Corporation from those projected, including, but not limited to, statements regarding Universal Display Corporation's beliefs, expectations, hopes or intentions regarding the future. Universal Display Corporation expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Universal Display Corporation's expectations with regard thereto or any change in events, conditions, or circumstances on which any such statements are based. It is important to note that actual outcomes and Universal Display Corporation's actual results could differ materially from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as: uncertainties relating to developments and advances in display technologies, including OLED, TOLED, SOLED, PHOLED and FOLED technology; the expansion of applications for OLED technology; the success of UDC and its development partners in accomplishing technological advances; including but not limited to, Organic Vapor Phase Deposition (OVPD) processes; the ability of Universal Display Corporation to enter into alliances with product manufacturers; product development, manufacturing, and marketing acceptance; uncertainties related to cost and pricing of Universal Display products; dependence on collaborative partners; and other competition, risks relating to intellectual property of others and the uncertainties of patent protection. These are discussed in periodic reports filed with the SEC, including the Company's annual report on Form 10-K for the year ended December 31, 2001 and quarterly report on Form 10-Q. Universal Display Corporation expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Universal Display Corporation's expectations with regard thereto or any change in events, conditions, or circumstances on which any such statements are based.