CONFIDENTIAL

                                SUPPLY AGREEMENT

         THIS SUPPLY AGREEMENT (this "Agreement") is entered into and effective
this 1st day of October, 2000 (the "Effective Date") by and between PPG
INDUSTRIES, INC., a corporation organized and existing under the laws of the
Commonwealth of Pennsylvania, U.S.A., having its principal place of business at
One PPG Place, Pittsburgh, Pennsylvania 15272 ("PPG"), and UNIVERSAL DISPLAY
CORPORATION, a corporation organized and existing under the laws of the
Commonwealth of Pennsylvania, U.S.A., having a principal place of business at
375 Phillips Boulevard, Ewing, New Jersey 08618 ("UDC").

         WHEREAS:

                  1. PPG possesses technical, manufacturing and business
know-how, as well as development resources and capabilities relating to various
chemical products;

                  2. UDC is the owner and/or licensee of technology related to,
and has expertise in the development and use of, organic light-emitting devices
("OLEDs");

                  3. PPG and UDC have agreed to utilize certain PPG research and
development capabilities, facilities and equipment, and the parties' respective
personnel and Know-How, to develop new and/or improved OLED Chemicals pursuant
to the Development Agreement by and between the parties as of the date hereof;
and

                  4. UDC desires to establish an assured supply of certain OLED
Chemicals to UDC and UDC's licensees, and has agreed to enter into a long-term
business relationship whereby PPG manufactures and is the exclusive supplier of
certain OLED Chemicals, and non-exclusive supplier of other OLED Chemicals, to
UDC for its own use and for resale to UDC's Licensees on the terms and
conditions set forth herein.

         NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements herein contained, the parties hereto, intending to be legally bound
hereby, covenant and agree as follows:

                             ARTICLE 1 - DEFINITIONS

         Whenever used in this Agreement, unless otherwise clearly indicated in
the context, the following terms shall have the meanings as defined in this
Article. As used herein, the singular includes the plural and vice versa.

         1.1 "Average Royalties" means the weighted average sales royalty
percentage paid to UDC by certain unaffiliated UDC Licensees for license rights
to use any Patents or Know-How respecting UDC's OLED technology to make and sell
OLEDs. This weighted average shall be calculated as of January 1, 2003, and
annually thereafter, using the ten (10) UDC Licensees having the highest dollar
volume of OLED sales during the immediately preceding calendar year or, if UDC
has less than ten (10) Licensees, such lesser number.




         1.2 "Competitive OLED Chemicals" means OLED Chemicals that are claimed
in or covered by any relevant issued Patents, respecting their compositions of
matter, methods of production, and/or uses in OLEDs, not owned by or licensed to
UDC.

         1.3 "Confidential Information" of a party shall include all trade
secret, confidential and/or proprietary information of such party, whether of a
technical, engineering, operational, financial or marketing nature (including,
without limitation, their respective proprietary materials), that is (i) in
writing and marked as "Trade Secret," "Confidential," "Proprietary" or with
words of a similar nature; or (ii) orally disclosed and clearly identified as
"Trade Secret," "Confidential" or "Proprietary" at the time of such disclosure
and confirmed in writing as such within thirty (30) days following such oral
disclosure.

         1.4 "Cost Margin Percentage" means sixty percent (60%), with such
percentage being increased or decreased (but never above 60%) on January 1,
2004, and annually thereafter, by the percentage increase or decrease in Average
Royalties, if any, since Average Royalties were last determined. The parties
acknowledge that the Cost Margin Percentage is based on an initial gross margin
percentage of forty percent (40%), such that, in example, if PPG's Product Costs
were one ($1) dollar, then PPG would then be entitled to a payment of $1.67 ($1
divided by .60), which is equal to a forty percent (40%) gross margin based on a
selling price of $1.67.

         1.5 "Developed Technology" shall have the meaning ascribed to such term
under the Development Agreement.

         1.6 "Development Agreement" means the Development and License Agreement
entered into by and between the parties as of the date hereof.

         1.7 "Development Program" shall have the meaning ascribed to such term
under the Development Agreement.

         1.8 "Gross Margin" means PPG's Product Costs divided by the Cost Margin
Percentage, with such quotient reduced by the amount of PPG's Product Costs.

         1.9 "Know-How" means trade secrets, know-how and other unpatented
technical and/or proprietary information, data, specifications, plans, drawings,
designs, copyrights, blueprints, formulae, processes and other similar items and
materials.

         1.10 "Maximum Quarterly Amount" means the maximum aggregate quantity of
all Products that PPG shall be obligated to supply to UDC hereunder during any
calendar quarter, which maximum aggregate quantity shall initially be fifty
kilograms (50 kg). Such maximum aggregate quantity may be increased by mutual
written agreement of the parties from time to time.

         1.11 "Non-Proprietary OLED Chemicals" means OLED Chemicals other than
Proprietary OLED Chemicals, including, without limitation, the OLED Chemicals
identified as Non-Proprietary OLED Chemicals on Exhibit B attached hereto. The
parties acknowledge that a Non-Proprietary OLED Chemical may become a
Proprietary OLED Chemical in the future should it meet the definition thereof.

                                       2


         1.12 "OLED Chemicals" means organic or organometallic molecules or
compounds positioned between the two electrodes in a device that radiates light
by applying electrical current or voltage to the electrodes.

         1.13 "Patents" means United States and foreign patents and patent
applications, together with all divisions, continuations, continuations-in-part,
reissues, re-examinations, renewals and extensions of the same.

         1.14 "Person" or "person" means any natural person, corporation,
partnership, limited liability company, proprietorship, association, trust or
other legal entity.

         1.15 "PPG's Product Costs" means all of PPG's costs of producing and
supplying the Product in question, the categories of which shall be specified on
Exhibit A attached hereto, as the same may be amended by mutual agreement of the
parties from time to time.

         1.16 "PPG's Sales Revenues" means total net sales revenues by PPG from
sales or other dispositions of OLED Chemicals to third parties as permitted
hereunder, as determined under generally accepted accounting principles in the
United States of America and as used for the preparation of PPG's published
financial statements. To the extent, if any, that net sales revenues accrued for
a given period are required to be increased or decreased, as the case may be, in
a subsequent period by an expense or credit in that subsequent period and in
conformance with such generally accepted accounting principles, PPG's Sales
Revenues for that subsequent period shall be adjusted by such expense or other
charge.

         1.17 "Princeton License Agreement" means that Amended License Agreement
by and among UDC, The Trustees of Princeton University ("Princeton University")
and the University of Southern California ("USC"), dated as of October 9, 1997,
as the same has been and may be amended from time to time provided that any
amendment does not materially alter the rights or obligations of the parties
under this Agreement.

         1.18 "Products" means (i) all Proprietary OLED Chemicals, and (ii) any
Non-Proprietary OLED Chemicals that UDC uses, or intends to use, for commercial
production of OLEDs, or resells, or intends to resell, to UDC Licensees.

         1.19 "Product Specifications" means, with respect to each Product
supplied hereunder, the mutually agreed upon written analytical specifications
for such Product, and for its packaging, storage and shipment. Such
specifications may be amended by mutual written agreement of the parties from
time to time.

         1.20 "Proprietary OLED Chemicals" means all Tier I Proprietary OLED
Chemicals and Tier II Proprietary OLED Chemicals, including, without limitation,
the OLED Chemicals identified as Proprietary OLED Chemicals on Exhibit B
attached hereto; provided, however, that any Tier II Proprietary OLED Chemical
which is or becomes generally available from one or more suppliers other than
PPG, in commercial quantities and at purities reasonably acceptable for use in
the production of OLEDs, and without UDC having provided any such other
suppliers with any UDC Proprietary Materials for Chemicals or any other
assistance in the development of such OLED Chemical (other than informing them
of the Product Specifications that the OLED Chemical must meet), shall, as of
such date, no longer be considered a Proprietary OLED Chemical for purposes of
this Agreement, but instead shall thereafter be considered a Non-Proprietary
OLED Chemical.

                                       3


         1.21 "Tier I Proprietary OLED Chemicals" means OLED Chemicals that are
claimed in any UDC Chemical Patents respecting their compositions of matter
and/or methods of production.

         1.22 "Tier II Proprietary OLED Chemicals" means OLED Chemicals that are
not Tier I Proprietary OLED Chemicals, but that (i) are claimed in any UDC
Chemical Patents respecting their uses in OLEDs; or (ii) are prepared using any
UDC Chemical Know-How and, due to such preparation, have unique characteristics
that materially impact their performance in OLEDs.

         1.23 "UDC Licensees" means persons to whom UDC licenses any Patents or
Know-How respecting its OLED technology.

         1.24 "UDC Licensee Prospects" means persons with whom UDC is engaged in
bona fide negotiations or discussions to license any Patents or Know-How
respecting its OLED technology, which persons have been identified to PPG by UDC
in writing.

         1.25 "UDC Chemical Know-How" means any and all Know-How relating to
OLED Chemicals or methods of producing OLED Chemicals, or that might reasonably
be useful in connection with producing OLED Chemicals, that UDC owns or
otherwise is authorized to disclose and license or sublicense to PPG hereunder,
including, without limitation, any such Know-How constituting Developed
Technology and any such Know-How acquired or licensed by UDC from Princeton
University or USC under the Princeton License Agreement or such other
agreements, whether prior to or after the Effective Date.

         1.26 "UDC Chemical Patents" means the Patents listed in Exhibit C
attached hereto and any and all other Patents, whether or not currently
existing, that claim or cover any OLED Chemicals or methods of producing OLED
Chemicals, or any methods or processes that might reasonably be useful in
connection with producing OLED Chemicals, and that UDC is authorized to license
or sublicense to PPG hereunder, including, without limitation, any such Patents
claiming Developed Technology and any such Patents acquired or licensed by UDC
from Princeton University or USC under the Princeton License Agreement or such
other agreements, whether prior to or after the Effective Date.

         1.27 "UDC's Profit" means UDC's net pre-tax, pre-interest profit on its
resale of the Product in question to a UDC Licensee, as determined under
generally accepted accounting principles in the United States of America and as
used for the preparation of UDC's published financial statements. As used
herein, "profit" shall mean the sales price for the Product less UDC's costs of
acquiring, developing, producing, selling and/or shipping the Product, plus an
allocation of general and administrative costs and research and development
costs appropriately allocated to the Product. To the extent, if any, that any
such profits accrued for a given period are required to be increased or
decreased, as the case may be, in a subsequent period by an expense or credit in
that subsequent period and in conformance with such generally accepted
accounting principles, UDC's Profit for that subsequent period shall be adjusted
by such expense or other charge.

                                       4


         1.28 "UDC Proprietary Materials for Chemicals" means all UDC Chemical
Patents, UDC Chemical Know-How, and Developed Technology, as well as the Product
Specifications.

         1.29 "Waste" means any "hazardous substance", "hazardous material"
and/or "hazardous waste" as provided under any environmental law, rule or
regulation, as well as any other waste material, pollutant and/or contaminant of
any kind including, without limitation, any routine process waste or any
by-product arising from the manufacture of any OLED Chemical hereunder.

              ARTICLE 2 - APPOINTMENT AND OBLIGATION TO MANUFACTURE

         2.1 Subject to the terms and conditions of this Agreement, UDC hereby
appoints PPG as its exclusive supplier of Products for its use for commercial
production of OLEDs and for resale to UDC Licensees and UDC Licensee Prospects
during the term of this Agreement. During the term of this Agreement, UDC shall
not, except in such limited quantities as are necessary for demonstration,
testing, evaluation and/or research and development purposes, or as otherwise
permitted hereunder: (i) sell or otherwise supply Products for use in OLEDs,
except those provided by PPG hereunder, to UDC Licensees or UDC Licensee
Prospects, (ii) enter into any partnership, joint venture or similar arrangement
with any other manufacturer of OLED Chemicals for the purpose of using such
Products for commercial production of OLEDs or for supplying Products to UDC
Licensees or UDC Licensee Prospects for use in OLEDs; or (iii) grant any other
person a license to make or sell Products for use in OLEDs.

         2.2 UDC shall, in conducting business with UDC Licensees, promote PPG
as UDC's exclusive supplier of Products for use in OLEDs. In addition, UDC shall
use commercially reasonable efforts to cause each UDC Licensee to enter into a
supply agreement with UDC, pursuant to which such UDC Licensee agrees to
purchase all of its requirements for commercial quantities of Products for use
in OLEDs from UDC during the term of this Agreement. Said efforts shall include
bona fide attempts to do the following; provided, however, that nothing in this
Agreement shall require UDC to violate any applicable antitrust or other similar
laws or engage in patent misuse in performing its obligations hereunder:

                  2.2.1 cause an exclusive supplier provision to be included
within the license agreement UDC executes with each UDC Licensee, pursuant to
which such UDC Licensee agrees to obtain its requirements for commercial
quantities of Products for use in OLEDs during the term of this Agreement by
purchasing Products supplied by PPG hereunder;

                  2.2.2 cause the execution of supply agreements between UDC and
each UDC Licensee without undue delay; and

                  2.2.3 condition the performance warranties, if any, with
respect to the OLEDs manufactured by each UDC Licensee upon such licensee's use
of Products supplied by PPG hereunder.

                                       5


The provisions of Sections 2.2.1 through 2.2.3, Section 2.3 and the last
sentence of Section 2.2 shall not apply to the currently contemplated agreement
between UDC and [The confidential material contained herein has been omitted and
has been separately filed with the Commission.] in the form presented to PPG on
October 25, 2000, provided that (i) UDC is otherwise in compliance with the
terms of this Agreement including, without limitation, the provisions of Section
2.1, and (ii) such agreement with [The confidential material contained herein
has been omitted and has been separately filed with the Commission.] is amended
to provide either that (a) [The confidential material contained herein has been
omitted and has been separately filed with the Commission.] cannot manufacture
any OLED Chemicals, or (b) the agreement is not assignable or transferable by
[The confidential material contained herein has been omitted and has been
separately filed with the Commission.] in any event; provided further that
notwithstanding the foregoing, Section 2.3 of this Agreement shall apply to the
agreement with [The confidential material contained herein has been omitted and
has been separately filed with the Commission.] if all or substantially all of
the assets of [The confidential material contained herein has been omitted and
has been separately filed with the Commission.] are acquired by a third party or
if the shareholders of [The confidential material contained herein has been
omitted and has been separately filed with the Commission.] approve a merger,
consolidation, share exchange, division or other disposition as a result of
which the shareholders of [The confidential material contained herein has been
omitted and has been separately filed with the Commission.] immediately prior to
the transaction will not own a majority of the voting power of the surviving or
resulting corporation or any corporation which acquires the stock of [The
confidential material contained herein has been omitted and has been separately
filed with the Commission.], with the result that [The confidential material
contained herein has been omitted and has been separately filed with the
Commission.] materially increases its manufacture or purchases of OLED Chemicals
as compared with its manufacture or purchase of OLED Chemicals prior to such
event.

         2.3 In the event that any UDC Licensee produces or obtains commercial
quantities of any Product for use in OLEDs from a source other than the
quantities of such Product supplied to UDC hereunder, except as expressly stated
to the contrary in this Agreement, UDC agrees to compensate PPG for its gross
margin on account of the UDC Licensee producing or obtaining the Product for use
in OLEDs from another source by paying PPG the Gross Margin that PPG would have
received had it sold an equal quantity of the Product to UDC hereunder. UDC
shall use reasonable best efforts to obtain or, if unavailable, calculate
whether and to what extent any UDC Licensee produces or obtains commercial
quantities of any Product for use in OLEDs from a source other than UDC. Should
a UDC Licensee desire to produce the Product or obtain it from another supplier
for use in OLEDs, UDC would be permitted to grant the UDC Licensee or its
supplier a license to manufacture the Product solely for use by such UDC
Licensee (subject to payment of the Gross Margin in accordance with the
foregoing provisions of this paragraph, regardless of whether the Product is
supplied by the Licensee, its supplier or any sublicensee); provided, however,
that nothing herein shall require PPG to transfer any technology to such UDC
Licensee or supplier in connection with the granting of such a license and
provided further that UDC will notify PPG of the existence of any such license,
a copy of which may be obtained by PPG at its option, and shall include in any
such license a requirement that the UDC Licensee or other supplier report to UDC
the amount of any Product manufactured.

         2.4 UDC will provide PPG, on an annual basis, with a list of the names
and addresses of all UDC Licensees and UDC Licensee Prospects. PPG agrees to
provide UDC with all of its requirements for Products in accordance with the
terms, conditions and provisions of this Agreement, subject to any limitations
on maximum amounts, lead times and the like provided in Article 3 below. PPG
shall use commercially reasonable efforts to allocate sufficient resources and
adopt sufficient planning procedures to fulfill its obligations hereunder in a
timely manner. In addition, PPG agrees to provide UDC with reasonable technical
support with respect to the quality, safety and specifications of Products
supplied hereunder.

                                       6


         2.5 All Products supplied by PPG directly to UDC and indirectly to UDC
Licensees shall be manufactured, packaged, stored and shipped according to and
in compliance with their corresponding Product Specifications, and in accordance
with manufacturing practices as implemented by PPG with respect to other,
similar products manufactured by PPG. The parties shall endeavor to establish
the Product Specifications in a manner designed to ensure that the Products are
of high quality and purity, are fit for use in connection with OLEDs, and can be
manufactured at a commercially reasonable price. With respect to Products that
are the subject of the Development Program, the parties shall in good faith
attempt to agree upon the Product Specifications for such Product as part of
such program. The parties will cooperate in good faith should either party
propose any changes to the Product Specifications. The parties will also
cooperate in good faith to control PPG's Product Costs for each Product supplied
hereunder and to reduce such costs to the fullest extent reasonably practicable
in light of its corresponding Product Specifications and required volumes. In
addition, the parties shall work together in a jointly cooperative manner in
support of Product sales and the development of new Products to meet future
requirements of UDC Licensees.

         2.6    A "Business Concern" would exist in the following circumstances:

                  2.6.1 The parties, despite their good faith efforts, are
unable to agree on Product Specifications for the Product, or on revised Product
Specifications for the Product in response to legitimate business concerns
raised by UDC, and such disagreement concerns an aspect of the Product
Specifications that has, or is reasonably anticipated to have, a material impact
on performance of the Product in OLEDs, and that has been reasonably
demonstrated to be commercially achievable;

                  2.6.2 PPG is regularly unable to provide commercial quantities
of the Product that meet the agreed upon Product Specifications and the parties,
despite their good faith efforts, are unable to agree on revised Product
Specifications that PPG is able to meet on a regular basis;

                  2.6.3 The parties, despite their good faith efforts, are
unable to agree upon an increase in the Maximum Quarterly Amount, such increase
to take effect within a reasonable period of time taking into consideration any
required scale-up and/or capital investment by PPG, and the increase is
reasonably required by UDC to satisfy the demands of UDC Licensees for Products;
or

                  2.6.4 The price charged to UDC for the Product would be or
becomes significantly greater than the price other suppliers charge, or have
indicated in a bona fide, written offer that they would charge, to supply UDC or
a UDC Licensee with a Product meeting the Product Specifications at comparable
volumes. For purposes of this Section 2.6.4, "significantly greater" shall mean,
with respect to Products that are Proprietary OLED Chemicals, at least fifty
percent (50%) higher than the price of the other supplier, and, with respect to
Products that are Non-Proprietary OLED Chemicals, any higher than the price of
the other supplier.

                                       7


         2.7 Should a Business Concern arise, the following procedures would
apply:

                  2.7.1 UDC would be able to provide PPG with written notice of
the Business Concern. Such written notice would indicate why UDC believes a
Business Concern exists. UDC would be required to provide PPG with documentation
reasonably substantiating UDC's claim that a Business Concern exists.

                  2.7.2 PPG would have ninety (90) days from its receipt of
UDC's written notice to address the Business Concern in a manner that is
reasonably acceptable to UDC (forty-five (45) days with respect to a Business
Concern involving a Product that is a Non-Proprietary OLED Chemical). On PPG's
written request, this time period would be extended up to an additional ninety
(90) days should PPG (an additional fifteen (15) days with respect to a Product
that is a Non-Proprietary OLED Chemical), during the initial time period,
commence good faith efforts to address the Business Concern so as to resolve it
in a manner that is reasonably acceptable to UDC. UDC would cooperate in good
faith with PPG in its efforts to address the Business Concern in such a manner.

                  2.7.3 Except for any Business Concern arising under Section
2.6.3, with respect to any Product for which the Business Concern has not been
addressed in a manner reasonably acceptable to UDC within the time frame(s)
specified in Section 2.7.2 above, UDC would not be required to compensate PPG,
as specified in Section 2.3 above, for its gross margin on account of any UDC
Licensee obtaining the Product for use in OLEDs from a source other than the
quantities of such Product supplied to UDC hereunder. In such circumstances,
however, but not with respect to a Business Concern arising under Section 2.6.2
or Section 2.6.3 above, UDC would be required to pay PPG fifty percent (50%) of
any license fees and/or royalties and/or other benefits that UDC receives from
the other supplier on account of any license granted by UDC to such other
supplier for purposes of manufacturing the Product for use by such UDC Licensee
in OLEDs.

                  2.7.4 In the case of a Business Concern arising under Section
2.6.3, with respect to any Product for which the Business Concern has not been
addressed in a manner reasonably acceptable to UDC within the time frame(s)
specified in Section 2.3 above, UDC would not be required to compensate PPG, as
specified in Section 2.3 above, for its gross margin on account of any UDC
Licensee obtaining the Product for use in OLEDs from a source other than the
quantities of such Product supplied to UDC hereunder to the extent that such
quantities exceed the Maximum Quarterly Amount agreed to by PPG with respect to
such Product.

         2.8 Except as expressly permitted by UDC in writing, PPG shall not sell
or supply Proprietary OLED Chemicals for any uses to persons other than UDC, or
assist or authorize any other person to sell or supply Proprietary OLED
Chemicals for any uses to persons other than UDC. Notwithstanding the foregoing
sentence, PPG may sell or supply any Tier II Proprietary OLED Chemical to any
other person for uses other than in OLEDs. With respect to sales of Tier II
Proprietary OLED Chemicals to UDC Licensees, UDC Licensee Prospects and other
persons known by PPG to be in the OLED business, PPG shall provide UDC with
prior written notice of the Tier II Proprietary OLED Chemical to be supplied,
the identity of the person to which such chemical will be supplied unless PPG is
otherwise contractually obligated to maintain such identity as confidential. PPG
shall use its reasonable best efforts to avoid being so contractually obligated.
The person to which the Tier II Proprietary OLED Chemical is supplied shall be
informed in writing that the use of such chemical in OLEDs may be prohibited
without obtaining all appropriate license rights from UDC. Should PPG learn any
such person is using a Tier II Proprietary OLED Chemical in OLEDs without
obtaining all appropriate license rights from UDC, PPG agrees to cease supplying
such person with such chemical.

                                       8


         2.9 PPG shall be free to sell or supply Non-Proprietary OLED Chemicals
for all uses (i) with respect to Non-Proprietary OLED Chemicals that are
Products, to persons other than UDC Licensees and UDC Licensee Prospects,
including distributors without regard to the identity of such distributors'
customers, and (ii) with respect to Non-Proprietary OLED Chemicals that are not
Products, to all persons.

         2.10 With respect to Tier II Proprietary OLED Chemicals sold or
otherwise distributed for any uses to any person other than UDC, and with
respect to Non-Proprietary OLED Chemicals sold or otherwise distributed for use
in OLEDs to any person other than UDC, PPG shall pay to UDC a commission equal
to five percent (5%) of PPG's Sales Revenues attributable to such sales or other
distribution. In addition, with respect to PPG's sale or other distribution to a
person other than UDC of any Tier II Proprietary OLED Chemical or
Non-Proprietary OLED Chemical that is a Product, should such OLED Chemical
ultimately be sold or otherwise distributed to a UDC Licensee UDC shall not be
required to pay PPG its gross margin with respect thereto as required under
Section 2.3 above. Should PPG offer any Tier II Proprietary OLED Chemical or
Non-Proprietary OLED Chemical meeting its corresponding Product Specifications
for sale to any person other than UDC, PPG agrees to offer to sell such chemical
to UDC for its own use and for resale to UDC Licensees at prices and on other
terms and conditions that are no less favorable to UDC than the prices and other
terms and conditions on which such chemical is offered for sale to any other
person who purchases such chemical in comparable volumes, plus, in the case of
Non-Proprietary OLED Chemicals sold for OLED applications, in the event that PPG
routinely sells such Product other than through a distributor, the parties will
negotiate prices and other terms and conditions in good faith to protect the
commercial rights of UDC's Licensees to obtain the Product at comparable prices
and at similar volumes from UDC, such that UDC and PPG each receive reasonable
economic benefits from such supply or production.

         2.11 Except as expressly permitted under this Section 2.11, PPG shall
not sell or supply Competitive OLED Chemicals for OLED uses to persons other
than UDC, or assist or authorize any other person to sell or supply Competitive
OLED Chemicals for OLED uses to persons other than UDC. Should PPG desire to
sell or supply any Competitive OLED Chemical for OLED uses to any other person,
PPG shall provide UDC with at least thirty (30) days' prior written notice
thereof, which notice shall identify the Competitive OLED Chemical to be
supplied and the identity of the person to which such chemical would be
supplied. Unless UDC, in a written notice provided to PPG during such 30-day
period, objects for good cause to PPG selling or supplying the Competitive OLED
Chemical for OLED uses to such other person ("good cause" meaning that the sale
or supply of such chemical to such person is reasonably likely to have a
material adverse effect on UDC's OLED business), PPG shall be free to sell or
supply the Competitive OLED Chemical for OLED uses to such other person.

                                       9


         2.12 Unless the parties expressly agree in writing otherwise and
notwithstanding anything to the contrary in this Agreement, PPG is prohibited
from utilizing any UDC Proprietary Materials for Chemicals and/or any
Confidential Information of UDC in manufacturing, purifying, analyzing or
distributing OLED Chemicals to persons other than UDC as permitted under
Sections 2.8 through 2.11 above.

                   ARTICLE 3 - FORECASTS, ORDERS AND PLANNING

         3.1 Should the Maximum Quarterly Amount be increased by the parties to
an amount above fifty kilograms (50kg), the parties shall mutually agree in
writing on procedures whereby UDC would provide PPG with rolling 12-month
forecasts of its requirements for Products, said forecasts to be provided at
least thirty (30) days prior to the start of each calendar quarter. Such written
procedures shall be incorporated into this Agreement by written amendment. Until
such time as a forecasting procedure is put in place, the parties shall comply
with the provisions of Sections 3.2 and 3.3 respecting the ordering of Products.

         3.2 Upon UDC's request for a given Product, PPG shall indicate to UDC
in writing the following information: (i) the minimum lead time PPG would
require for it to produce different quantity ranges of the Product (such
reasonable quantity ranges to be specified by UDC) such that they would be ready
for shipment to UDC (the "Product Lead Times"); and (ii) the Standard Price and
the Not-To-Exceed Price (as such terms are defined in Section 5.2 below) for
each such quantity of the Product. PPG shall use commercially reasonable efforts
to minimize the Product Lead Times for Products, taking into consideration the
time required for PPG to obtain all raw materials needed to manufacture the
Product and the number of synthetic steps involved in manufacturing the Product.
Should UDC request in writing that PPG reduce the Product Lead Time for a
Product by maintaining an inventory of the raw materials used to manufacture the
Product, UDC agrees to reimburse PPG for (i) the reasonable cost of storing such
raw materials on UDC's behalf, (ii) PPG's cost of money, at a rate of eleven and
one-half percent (11.5%) per annum (based on a year of 365 days) compounded
daily from the date of purchase to the date of use of such raw materials, and
(iii) with respect to any such raw materials that become obsolete or are on hand
on the date of expiration or termination of this Agreement or have not been
converted into Products within twelve (12) months of the date of purchase, and
that PPG cannot reasonably use to manufacture products for other persons, the
actual cost of such raw materials to PPG. At UDC's option and expense, all such
obsolete raw materials shall be shipped to UDC or destroyed.

         3.3 UDC shall initiate Product orders by providing PPG with written
orders (each, a "Firm Order") indicating, at a minimum, the following: (i) the
Product to be produced and its corresponding Product Specification, (ii) the
quantity requested, and (iii) the requested date for completion of production
such that the Product would be ready for shipment to UDC. Within ten (10) days
following its receipt of any Firm Order, PPG shall respond to UDC in writing by
either accepting the Firm Order or rejecting the Firm Order and indicating
whether and to what extent PPG will be able to fill the Firm Order and the date
by which production of the Product will be completed such that the Product will
be ready for shipment to UDC. PPG shall be entitled to reject only that portion
of any Firm Order which (i) would require PPG to produce during a calendar
quarter a quantity of Products greater than the Maximum Quarterly Amount; (ii)
PPG reasonably determines that it cannot fill because the time period between
the date on which PPG

                                       10


receives the Firm Order and the requested date for completion of production is
shorter than the Product Lead Time; or (iii) PPG reasonably anticipates that it
will be unable to fill due to the occurrence of a force majeure event as
specified under Section 15.1 below. In the event PPG rejects a Firm Order due to
one of the foregoing events, PPG and UDC shall meet within ten (10) days and
agree in good faith on whether and when PPG will be able to produce the Product
in question. Following such meeting, UDC shall submit to PPG a revised Firm
Order reflecting the parties' good faith agreement and PPG shall commence
production of the Product based on such revised Firm Order. In all cases, PPG
agrees to use commercially reasonable efforts to fill any Firm Order for Product
by the requested date for completion of production, subject to the provisions in
Section 3.2 above respecting Product Lead Times and UDC's payment of any
additional costs incurred by PPG in manufacturing amounts in excess of the
Maximum Quarterly Amount. With respect to any Firm Order for Product that PPG is
unable to fill by the requested date for completion of production (provided the
time period between the date PPG receives the Firm Order and the requested date
for completion of production is no shorter than the Product Lead Time, but not
with respect to any portion of such Firm Order that would obligate PPG to
manufacture Products during a calendar quarter in excess of the Maximum
Quarterly Amount), UDC shall not be required to pay PPG its gross margin as
required under Section 2.3 above should the Product covered by such Firm Order
be obtained from another source of supply within the Product Lead Time. The
foregoing sentence shall not limit any other rights or remedies that may be
available to UDC on account of PPG's inability to fill the Firm Order by the
applicable date for completion of production.

         3.4 Upon UDC's request and behalf, PPG shall store completed Products
ordered by UDC and for which UDC has paid PPG until such time as UDC provides
PPG with instructions regarding the shipment of such Products to UDC or UDC
Licensees. UDC shall bear the risk of loss for such Products and shall pay for
such Products to be insured while they are being stored by PPG. PPG shall
institute reasonable tracking and security measures designed to ensure that such
Products are not lost, misplaced or stolen. Should UDC require specific tracking
and security measures beyond those used for other, similarly valuable products
stored by PPG, PPG may require UDC to bear the costs of such additional tracking
and security measures. Upon UDC's request, PPG shall indicate to UDC the amounts
of each Product currently being stored by PPG and the dates on which such
Products were produced by PPG.

         3.5 The parties recognize that detailed and continuing exchanges of
information shall be necessary in order to optimize the administration of this
Agreement and PPG's supply of Products, consistent with the respective rights
and obligations of the parties hereunder. To that end, each party shall
designate a representative (and notify the other party of the individual so
designated) responsible for exchanging information and for resolving issues
relating to the forecasting, ordering, production, shipment and sales of
Products which may arise under this Agreement. The designated representatives of
UDC and PPG shall conduct planning meetings (which may be by teleconference if
practicable) at least four (4) times per year to address any issues which may
arise.

                                       11


           ARTICLE 4 - PRODUCT SHIPMENTS; INSPECTIONS AND REPLACEMENT

         4.1 UDC shall send PPG written instructions for the shipment of
Products that have been ordered and are being produced or stored by PPG
("Instructions"), which Instructions shall indicate, at a minimum, the
following: (i) the Product to be shipped, (ii) the quantity to be shipped, (iii)
the requested shipping date (which shall not be sooner than the agreed-upon date
for completion of production of the Product), (iv) the desired method of
shipment, (v) the name of the person to receive the shipment and the shipping
destination, (vi) whether PPG should insure the shipment on UDC's behalf, and
(vii) any special packaging or shipping requirements or instructions. Unless the
parties agree otherwise, UDC shall provide PPG with such instructions at least
ten (10) days in advance of the date on which the shipment is to be shipped.

         4.2 Each shipment of Products shall be delivered by PPG to an
agreed-upon carrier for shipment to UDC or a UDC Licensee. Title and risk of
loss, delay or damage to the shipment shall pass to UDC at the time the shipment
is delivered by PPG to the carrier, except that with respect to Product stored
by PPG under Section 3.4 above, and subject to PPG's obligation under that
Section to institute reasonable tracking and security measures, title and risk
of loss or damage shall pass to UDC at the time the Product is placed in storage
by PPG. With respect to any Product removed from storage for shipment, PPG shall
use commercially reasonable efforts to ensure that the Product is placed into
the possession of the carrier without loss, damage or delay.

         4.3 Each shipment of Products shall be accompanied by a packing slip
describing the shipment, stating any order number for the shipment that has been
provided by UDC, and showing the shipment's destination. In addition, PPG shall
affix such labels to containers for the Products and shall include with the
Product shipments such invoices and other documentation as UDC may reasonably
request. PPG may invoice UDC separately for the cost of any labels obtained by
PPG on UDC's behalf.

         4.4 UDC shall reimburse PPG for its necessary and reasonable
out-of-pocket expenses incurred in connection with obtaining freight and
insurance on shipments of Products made by PPG. If PPG contracts for freight and
insurance on UDC's behalf, PPG shall invoice UDC for such costs.

         4.5 In the event UDC determines that any shipment of a Product does not
conform to its corresponding Product Specifications, or is short, UDC shall
promptly provide PPG with written notice thereof, which notice shall specify the
manner in which the shipment is non-conforming or short. Such written notice
shall be provided to PPG within [The confidential material contained herein has
been omitted and has been separately filed with the Commission.] following the
date of receipt of the shipment at the shipping destination. With the exception
of latent failures of the shipment to meet the Product Specifications, which
failures were not reasonably discoverable in any batch sample of the Product
provided by PPG under Section 6.1 below, the shipment shall be deemed accepted
by UDC with respect to all non-conformities and shortages not identified to PPG
within said [The confidential material contained herein has been omitted and has
been separately filed with the Commission.] period.

         4.6 PPG shall make up all valid shortages in shipments promptly upon
receiving any notice thereof from UDC. In addition, PPG shall rework or replace,
and ship to UDC or the appropriate UDC Licensee, all Products that do not
conform to their corresponding Product Specifications as soon as reasonably
possible. Except to the extent the non-conformity is due to a material breach of
this Agreement by UDC, such reworking and replacement, or reshipping, shall be
at PPG's cost and expense. All non-conforming Products that cannot be reworked
or replaced, shall be disposed of by PPG in accordance with all applicable laws,
rules, regulations and other requirements. With the exception of latent failures
of a shipment of Product to meet its corresponding Product Specifications, which
failures were not reasonably discoverable in any batch sample of the Product
provided by PPG under Section 6.1 below, this Section 4.6 states UDC's sole
remedy and PPG's sole responsibility with respect to any short or non-conforming
shipment of Product provided to UDC or any UDC Licensee hereunder. The foregoing
sentence shall not apply with respect to claims of bodily injury or damage to
tangible property resulting from the negligence or willful misconduct of PPG.

                                       12


         4.7 The provisions of this Article and of Article 5 below are hereby
incorporated by reference into any Firm Order or revised Firm Order submitted by
UDC and accepted by PPG. To the extent of any conflict or inconsistency between
this Agreement and any Firm Order, revised Firm Order or written instructions
provided by UDC, the provisions of this Agreement shall govern. No preprinted
terms of any purchase order or Firm Order or revised Firm Order shall have any
effect, excepting only those terms governing quantity and buyer's reference or
administrative numbers.

                      ARTICLE 5 - PRICING AND PAYMENT TERMS

         5.1 PPG shall submit invoices to UDC for Products manufactured pursuant
to Firm Orders submitted by UDC as PPG completes the manufacturing of such
Products. For each such Product, subject to the provisions of Section 5.2 below,
PPG shall invoice UDC for PPG's Product Costs divided by the Cost Margin
Percentage in effect at that time.

         5.2 Rather than calculating PPG's Product Costs for each batch of
Product manufactured for UDC hereunder, PPG shall reasonably estimate such costs
in a manner designed to standardize the pricing charged to UDC for Products. The
amount invoiced to UDC under Section 5.1 for each batch of Product manufactured
for UDC (the "Standard Price") shall be based on such estimated costs. PPG shall
also indicate to UDC the maximum price that PPG will charge UDC for the batch of
Product (the "Not-To-Exceed Price"). Thereafter, PPG shall determine PPG's
Product Costs actually incurred for each batch of Product and shall calculate an
actual price for such batch (the "Actual Price"). Differences between Standard
Prices and the Actual Prices for batches of Products shall be reconciled (each,
a "Reconciliation") at the following intervals: (i) at the end of each calendar
year until the total amount invoiced to UDC under Section 5.1 during the
upcoming 12-month period exceeds or is projected to exceed Five Hundred Thousand
Dollars ($500,000); (ii) at the end of each calendar quarter beginning when the
total amount invoiced to UDC under Section 5.1 exceeds or is projected to exceed
Five Hundred Thousand Dollars ($500,000) during the upcoming 12-month period and
continuing until such total amount exceeds or is projected to exceed Two Million
Dollars ($2,000,000) during the upcoming 12-month period; and (iii) at the end
of each calendar month beginning when the total amount invoiced to UDC under
Section 5.1 exceeds or is projected to exceed Two Million Dollars ($2,000,000)
during the upcoming 12-month period. Should a Reconciliation indicate that a
refund is due to UDC, PPG shall, at UDC's option and within sixty (60) days
following the end of the time period covered by the Reconciliation, either pay
such amount to UDC or credit such amount against UDC's other payment obligations
to PPG hereunder. Should a Reconciliation indicate that an additional amount is
due and owing to PPG, PPG shall invoice UDC for such amount; provided, however,
that in no event shall PPG invoice UDC for more than the aggregate of the
Not-To-Exceed Prices for batches of Products manufactured during the time period
covered by the Reconciliation.

                                       13


         5.3 In addition to the amounts payable to PPG under Section 5.1 above,
with respect to each Product sold by UDC hereunder, UDC shall pay PPG an amount
equal to fifty percent (50%) of UDC's Profit (such amount referred to herein as
the "Additional Shared Profit"). UDC agrees to pay all Additional Shared Profits
to PPG within thirty (30) days following the end of each calendar quarter during
which the sales on which such Additional Shared Profits are based accrue to UDC.

         5.4 UDC agrees to pay all amounts invoiced hereunder within thirty (30)
days following UDC's receipt of PPG's invoice, except that payment of amounts
disputed in good faith may be withheld pending resolution of the dispute;
provided, however, that amounts payable to carriers shall not be withheld from
PPG in the event of a dispute with the carrier, and provided further that PPG
shall act reasonably in assisting UDC in resolving the dispute with the carrier.
All amounts payable to PPG under this Agreement shall be paid in U.S. Dollars by
wire transfer of immediately available funds to a bank designated by PPG, or by
such other means as PPG shall specify. Said amounts shall be paid to PPG without
setoff or deduction of any kind. UDC shall secure all authorizations required
for payment of such amounts to PPG and shall bear all transfer fees, taxes and
other charges associated therewith.

         5.5 PPG shall keep accurate and complete books of account and
supporting data and records, which shall contain all particulars that may be
necessary for the purpose of showing the amounts payable by UDC under Section
5.1 and by PPG under Section 2.10 above ("PPG's Books of Account"). UDC shall
keep (i) accurate and complete books of account and supporting data and records,
which shall contain all particulars that may be necessary for the purpose of
showing the amounts payable by UDC under Sections 5.3 and 2.7.3 above, and (ii)
records and supporting data for its calculations under Section 2.3 above
(collectively, "UDC's Books of Account").

         5.6 During the term of this Agreement and for at least two (2) years
thereafter, an independent certified public accountant selected by either party
shall have the right to examine the Books of Account for the prior two (2) years
kept by the other party for purposes of verifying all amounts payable to PPG
hereunder. The auditing party shall give reasonable advance notice of any such
audit to the other party, and such audit shall be conducted in a manner that
does not cause unreasonable disruption to the other party's conduct of its
business. The results of any such audit shall be treated as Confidential
Information of the audited party and may not be disclosed by the auditing party
or the accountant except as may be necessary for the auditing party to enforce
its rights hereunder. If an audit reveals any overpayment by UDC, PPG shall
immediately pay to UDC all overpaid amounts, plus interest on such amounts from
the date the overpayment was made at the rate specified in Section 5.7 below. If
an audit reveals any underpayment by UDC, UDC shall immediately pay to PPG all
amounts due and owing, plus interest on such amounts from the date payment was
initially due at the rate specified in Section 5.7 below. The auditing party
shall be responsible for paying the fees and expenses charged by the accountant
for conducting any audit hereunder; provided, however, that if any overpayment
in the case of an audit by UDC, or any underpayment in the case of an audit by
PPG, exceeds five percent (5%) of the total amounts that should have been paid
by UDC during the audited period, the audited party shall promptly reimburse the
auditing party for said fees and expenses of the auditor.

                                       14


         5.7 Late payments of amounts due hereunder shall bear interest at the
Prime Rate plus two percent (2%), or the maximum rate permitted by law,
whichever is lower. As used herein, the "Prime Rate" shall be the prime rate of
interest as reported in The Wall Street Journal on the first business day
immediately preceding the date on which the payment is made.

               ARTICLE 6 - QUALITY CONTROL; PRODUCTION FACILITIES

         6.1 Unless and until the parties otherwise agree in writing, upon
completing production of any batch of Product ordered hereunder, PPG shall make
a batch sample available to UDC for testing in order to verify that such batch
of Product complies with its corresponding Product Specifications, and any
failure to meet the Product Specifications shall apply only to the batch
affected. For each batch of any Product produced by PPG hereunder, PPG shall
maintain quality control samples and records for a period of two (2) years
following the date of production. Such samples and records shall be available
for review and testing by UDC or its designees on reasonable advance notice and
during normal business hours.

         6.2 PPG shall inform UDC in writing of the occurrence or expected
occurrence of material events that might reasonably be expected to affect the
quality, quantity, cost or any other material aspect of any Product manufactured
hereunder, including, without limitation, any changes in manufacturing
conditions or quality control procedures relating to the manufacture of the
Product. PPG shall, upon UDC's request, supply test data and/or samples of
Products produced hereunder to UDC and otherwise reasonably cooperate with UDC,
in order to permit UDC to evaluate the possible effects of such events and
verify that PPG will continue to be able to supply Products as required
hereunder.

         6.3 UDC shall have the right, upon reasonable advance notice and during
regular business hours, to test Products being produced and/or stored by PPG
hereunder, and, upon reasonable advance notice, to visit, inspect and audit the
facilities at which such Products are produced and/or stored, as well as all
relevant records being maintained by PPG in connection therewith. Upon prior
approval by PPG, such approval not to be unreasonably withheld, UDC Licensees
and UDC Licensee Prospects may visit the facilities. All persons visiting,
inspecting or auditing any PPG facilities shall be required to comply with PPG's
generally applicable policies and procedures with respect thereto, including,
without limitation, executing PPG's standard form confidentiality agreement
prior to the visit, inspection or audit.

         6.4 Should the need arise with respect to any Product, as reasonably
determined by UDC in light of concerns raised by UDC Licensees, PPG shall
establish a second source of supply for such Product, the method of providing
such second source of supply to be mutually agreed upon by the parties in good
faith. The second source of supply for such Product shall be located at or
obtained from a facility different from the primary facility or facilities at
which the Product is produced and/or stored. UDC shall be required to reimburse
PPG for all reasonable and necessary costs (including required capital
improvements) incurred by PPG in establishing and maintaining any second source
of supply for a Product as requested by UDC hereunder. Nothing in this Section
6.4 shall affect determination of the Maximum Quarterly Amount or PPG's
obligation to supply Products to UDC up to that amount.

                                       15


              ARTICLE 7 - REGULATORY COMPLIANCE; HEALTH AND SAFETY

         7.1 PPG shall comply in all material respects with all applicable
domestic and foreign governmental requirements for, and where required obtain or
provide, all registrations, permits, notices, reports, licenses, and supplier
notifications with respect to its production, sale, packaging and shipment of
Products hereunder.

         7.2 PPG shall be responsible for preparing and delivering to UDC
Material Safety Data Sheets for Products supplied hereunder, as may be required
under the Occupational Safety and Health Act, regulations promulgated thereunder
and any similar state "right-to-know" laws that are currently in force or that
may be enacted in the future. UDC shall be responsible for delivering such
Material Safety Data Sheets to those persons to whom UDC sells or otherwise
supplies the Products, including UDC Licensees and UDC Licensee Prospects. PPG
shall update such Material Safety Data Sheets as necessary to comply with all
material legal requirements, and shall promptly provide UDC with such updated
Material Safety Data Sheets, which UDC shall deliver to those persons to whom
UDC sells or otherwise supplies the Products. PPG shall be listed as the
emergency contact on all container labels and Material Safety Data Sheets, and
shall be responsible for emergency response in the case of any emergencies or
other incidents involving the Products supplied hereunder.

         7.3 Each party shall become reasonably familiar with the OLED Chemicals
supplied hereunder and with any raw materials used and/or Wastes generated by
such party during the course of producing, packaging, handling and/or using such
OLED Chemicals. Each party shall be responsible for informing its employees of
any known or reasonably ascertainable chemical hazards associated with the OLED
Chemicals supplied hereunder, and with any such raw materials or Wastes that its
employees may handle, and each party shall provide its employees with reasonable
training in the proper methods of handling such items.

         7.4 Each party shall promptly notify the other of any information or
notice it has or becomes aware of, including, without limitation, any threatened
or pending action by any governmental authority, concerning the health and/or
environmental risks posed by any OLED Chemical supplied hereunder or any raw
material used or Waste generated during the course of producing or packaging
such OLED Chemical, including, but not limited to, information concerning any
known or suspected side effects, injuries, toxicity, sensitivity reactions,
complaints, alleged defects or other adverse experiences (including the severity
thereof) associated with exposure to or use of such items.

                           ARTICLE 8 - WASTE DISPOSAL

         8.1 PPG shall be solely responsible for the lawful management
(including, without limitation, the emission, release and disposal) of all
Wastes generated in connection with the manufacture and supply of OLED Chemicals
under this Agreement. PPG shall handle, accumulate, label, package and ship such
Wastes in material compliance with all applicable federal, state and local laws,
rules, regulations and orders.

                                       16


                        ARTICLE 9 - INTELLECTUAL PROPERTY

         9.1 UDC hereby grants to PPG, during the term of this Agreement and
subject to the terms and conditions set forth herein, a worldwide, royalty-free,
non-exclusive, non-transferable (except as permitted under Section 15.2 below)
license, with the right to sublicense under Section 9.2, to practice under any
and all UDC Chemical Patents, and to use, improve, enhance and modify any and
all unpatented UDC Proprietary Materials for Chemicals, for the sole and limited
purposes of producing and selling Products to UDC (and, under Section 13.6
below, UDC Licensees) as contemplated hereunder.

         9.2 The licenses granted to PPG under this Agreement shall extend to
any division of or subsidiary controlled by PPG. In addition, PPG shall be
permitted to sublicense, in whole or in part, its license rights hereunder to
other persons performing manufacturing activities on PPG's behalf with respect
to Products to be supplied to UDC hereunder. PPG shall provide UDC with written
notice of the names and addresses of each such sublicensee, as well as a full,
unredacted copy of the sublicense agreement and all subsequent amendments and
modifications thereof, before or within a reasonable period of time after PPG
enters into such sublicense. Each sublicense granted by PPG hereunder shall (i)
expressly provide that such sublicense is nontransferable and nonassignable,
(ii) prohibit the initial sublicensee from granting any further licenses or
sublicenses thereunder, (iii) expressly provide that UDC is a third party
beneficiary of the sublicense agreement with rights to enforce its terms
directly against the sublicensee, and (iv) obligate the sublicensee to abide by
the terms and conditions of this Agreement applicable to sublicensees.

         9.3 UDC shall disclose UDC Chemical Know-How to PPG as is necessary in
connection with PPG's production of the Products supplied or to be supplied by
PPG hereunder. Such disclosures shall be as mutually agreed upon by the parties
in good faith.

         9.4 PPG shall apply to all containers containing Products supplied
hereunder such notices of the UDC Chemical Patents as may be reasonably
requested by UDC in writing, in order to protect UDC's rights and interests
therein.

         9.5 Notwithstanding anything to the contrary in this Agreement, PPG
acknowledges that some of its rights to certain UDC Chemical Patents derive from
the Princeton License Agreement. UDC agrees that PPG's rights to said UDC
Chemical Patents under this Agreement shall be a sublicense under the provisions
of the Princeton License Agreement.

         9.6 All right, title and interest in patentable and unpatentable
process or equipment improvements, inventions and other discoveries
(collectively, "Discoveries") shall be vested solely in the party making such
Discovery if the Discovery is made solely by such party or such party's
employees, or jointly in both parties (with each party having an undivided
interest therein without any obligation of accounting to the other) if the
Discovery is made jointly by both parties or both of their employees.
Notwithstanding the foregoing sentence, all improvements to or modifications of
any UDC Proprietary OLED Chemicals that are both (i) conceived, created, made or
reduced to practice by PPG personnel assigned to manufacture Products for UDC
hereunder as a direct result of their performing such manufacturing activities,
and (ii) OLED Chemicals, compositions of matter for Proprietary OLED Chemicals,
synthetic pathways (including purification) for developmental quantities of
Proprietary OLED Chemicals, and/or associated analytical characterization
techniques for Proprietary OLED Chemicals, together with all associated patent
and other intellectual property rights, (collectively, "UDC Improvements") shall
be and remain the sole and exclusive property of UDC and PPG hereby assigns and
transfers to UDC all of PPG's right, title and interest therein. Upon UDC's
request, PPG shall execute and deliver to UDC such assignments and other
instruments and take such other actions as may be necessary or reasonably
requested by UDC, so that UDC may protect and defend its rights in and to such
UDC Improvements. UDC hereby grants to PPG a license to practice under any and
all Patents and other intellectual property rights claiming UDC Improvements,
the scope of such license being identical to that granted to PPG with respect to
Developed Technology under Section 4.2 of the Development Agreement. Nothing
herein shall grant UDC any intellectual property rights to any improvements or
modifications for manufacturing commercial quantities of OLED Chemicals.

                                       17


         9.7 All trademarks, trade names and designs utilized on the packaging
for Products supplied under this Agreement shall be chosen by UDC provided,
however, that UDC obtains prior written approval to use any PPG trademarks,
trade names and designs. All rights to the respective trademarks, trade names
and designs of each party shall remain with that party. Except as otherwise
agreed to by the parties in writing, each party assumes all responsibility for
use of its trademarks, trade names or designs, or any portions thereof,
appearing on the packaging for or on other written materials distributed with
the Products supplied hereunder.

         9.8 Except for the license rights expressly granted to PPG under this
Agreement, or as otherwise expressly stated in the Development Agreement, UDC
retains all of its rights to the UDC Proprietary Materials for Chemicals.

              ARTICLE 10 - WARRANTIES AND LIMITATIONS OF LIABILITY

         10.1     Each party represents and warrants to the other as follows:

                  10.1.1 It has the requisite corporate right, power and
authority to enter into and perform this Agreement.

                  10.1.2 The execution, delivery and performance of this
Agreement by it will not (i) result in the breach of, constitute a default under
or interfere with any contract or other instrument or obligation, whether
written or oral, to which it is currently bound, or (ii) violate any writ,
order, injunction, decree, or any law, statute, rule or regulation applicable to
it.

                  10.1.3 It shall, to its knowledge following reasonable
inquiry, comply in all material respects with all applicable laws, rules,
regulations and other governmental requirements relating to or affecting its
performance under this Agreement, and shall obtain and maintain all governmental
permits, licenses and consents required in connection therewith.

         10.2     UDC represents and warrants as follows:

                  10.2.1 It owns or has, and shall retain, sufficient rights in
the UDC Proprietary Materials for Chemicals to grant the licenses, sublicenses
and rights granted to PPG hereunder.

                                       18


                  10.2.2 It is unaware of any alleged invalidity of the UDC
Chemical Patents licensed to PPG hereunder and it will immediately notify PPG in
writing of its receipt of any written notices to the contrary.

         10.3 PPG represents and warrants that it has or will have sufficient
rights to assign all UDC Improvements to UDC, pursuant to Section 9.6 of this
Agreement.

         10.4 EXCEPT FOR THE EXPRESS WARRANTIES CONTAINED IN THIS AGREEMENT,
NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES TO THE OTHER, EXPRESS OR
IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF TITLE,
NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. ALL SUCH
OTHER REPRESENTATIONS AND WARRANTIES ARE HEREBY DISCLAIMED.

         10.5 IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY
SPECIAL, INDIRECT, PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND (INCLUDING LOST
PROFITS, BUSINESS OR GOODWILL) IN CONNECTION WITH THIS AGREEMENT OR ANY MATTER
COVERED BY THIS AGREEMENT, REGARDLESS OF WHETHER SUCH LIABILITY IS BASED ON
BREACH OF CONTRACT, TORT, STRICT LIABILITY, BREACH OF WARRANTY OR ANY OTHER
THEORY, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

         10.6 PRINCETON UNIVERSITY AND USC MAKE NO REPRESENTATIONS AND
WARRANTIES AS TO THE PATENTABILITY AND/OR DISCOVERIES INVOLVED IN ANY OF THE UDC
CHEMICAL PATENTS. PRINCETON UNIVERSITY AND USC MAKE NO REPRESENTATION AS TO
PATENTS NOW HELD OR WHICH WILL BE HELD BY OTHERS IN ANY FIELD AND/OR FOR ANY
PARTICULAR PURPOSE. PRINCETON UNIVERSITY AND USC MAKE NO EXPRESS OR IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

                   ARTICLE 11 - INDEMNIFICATION AND INSURANCE

         11.1 Subject to Section 11.2 below, PPG shall indemnify, defend and
hold harmless UDC, its affiliates and their respective officers, directors,
members, employees, agents and representatives (each, an "Indemnified Party"),
from and against any and all claims, demands, liabilities, damages, judgments,
penalties, fines, costs, and expenses (including, but not limited to, reasonable
attorneys' fees; collectively "Claims") incurred by, or rendered against, each
such Indemnified Party arising out of any alleged or actual bodily injury to
persons, or damage to property, the environment or natural resources, at a
facility of PPG or any of its sublicensees or at a facility or location chosen
by PPG or any of its sublicensees for their disposal of Wastes generated in
connection with the manufacture of OLED Chemicals supplied under this Agreement
or any other facility or location at which such Wastes are ultimately disposed
or come to be located.

         11.2 UDC shall promptly notify PPG in writing, specifying the nature of
any Claim, the total monetary amount sought, and any other relief sought. Each
Indemnified Party shall cooperate with PPG in all reasonable respects in
connection with the defense and/or settlement of the Claim. Any compromise or
settlement of a Claim must be approved in writing by both parties, which
approval shall not be unreasonably withheld. Any Indemnified Party's failure to
give timely notice or to provide copies of documents or to furnish relevant data
in connection with any Claim shall not constitute a defense (in part or in
whole) to any claim for indemnification for such party, except and only to the
extent that such failure results in material prejudice to PPG. Each Indemnified
Party, upon written notice to PPG, shall have the right to employ separate
counsel at its own expense and participate in the defense of the Claim.

                                       19


         11.3 Each party shall maintain its standard general liability insurance
or its self-insurance practices to protect against covered damages, costs or
fees (including reasonable attorney's fees) arising out of or relating to any
property damage, bodily injury, sickness, disease or death, caused directly by
any negligent act or omission of either party's personnel while on premises at
the other party's facility, and will name the other party as an additional
insured under such insurance. The insured will provide the other party with a
certificate of such insurance, showing the other as an additional insured, and
notify the other of any material changes to the relevant insurance policies.

                      ARTICLE 12 - CONFIDENTIAL INFORMATION

         12.1 Each party (in such capacity, the "Receiving Party") shall review
and maintain Confidential Information of the other party (in such capacity, the
"Disclosing Party") in accordance with the following terms and conditions:

                  12.1.1 The Receiving Party agrees to treat all Confidential
Information of the Disclosing Party as confidential and not to disclose such
Confidential Information to any other person, or use such Confidential
Information for any purpose other than to perform its obligations or exercise
its rights hereunder, except as expressly permitted by the Disclosing Party in
writing.

                  12.1.2 The Receiving Party shall make only such copies of the
Confidential Information of the Disclosing Party as are reasonable for the
Receiving Party's performance of its obligations or exercise of its rights
hereunder.

                  12.1.3 At all times, the Receiving Party shall keep and
maintain all Confidential Information of the Disclosing Party in a safe and
secure place with reasonable safeguards to insure that unauthorized persons do
not have access to such Confidential Information. Upon discovery of any
unauthorized disclosure or use of Confidential Information of the Disclosing
Party, the Receiving Party shall immediately notify the Disclosing Party and
take all reasonable steps to prevent its further unauthorized disclosure or use.

                  12.1.4 The Receiving Party is prohibited from disclosing
Confidential Information of the Disclosing Party to third parties unless such
other person has a need-to-know such Confidential Information in connection with
the Receiving Party's performance of its obligations or exercise of its rights
under this Agreement. In addition, disclosure of such Confidential Information
to any third party shall be permitted only after such third party has agreed in
writing to abide by provisions of confidentiality and restrictive use no less
stringent than those set forth herein. The Receiving Party shall be responsible
for enforcing such provisions against such third party.

                                       20


                  12.1.5 With respect to all Confidential Information of the
Disclosing Party in the Receiving Party's possession or control (including,
without limitation, all copies and summaries thereof and regardless of the
format in which such Confidential Information is stored), the Receiving Party,
promptly upon the Disclosing Party's request, shall either: (i) return all such
Confidential Information to the Disclosing Party, or (ii) destroy all such
Confidential Information and certify the same to the Disclosing Party in
writing. Notwithstanding the foregoing sentence, the Receiving Party may retain
one copy of each tangible item of Confidential Information of the Disclosing
Party in a secure location solely for purposes of enforcement of this Agreement;
provided, however, that all such Confidential Information shall continue to be
governed in all respects by the other provisions of this Article. The provisions
of this Section 12.1.5 shall not apply to any Developed Technology.

         12.2 Notwithstanding anything to the contrary herein, the provisions of
this Article shall not apply with respect to any Confidential Information of the
Disclosing Party that:

                  12.2.1 is already in or subsequently enters the public domain
through no fault of the Receiving Party;

                  12.2.2 is supplied by the Disclosing Party to another person
without a duty of confidentiality;

                  12.2.3 is known to the Receiving Party or is in its possession
(as shown by tangible evidence) prior to receipt from the Disclosing Party;

                  12.2.4 is developed independently by the Receiving Party (as
shown by competent written records) without reliance on any Confidential
Information of the Disclosing Party;

                  12.2.5 is lawfully received by the Receiving Party from
another person without a duty of confidentiality to the Disclosing Party; or

                  12.2.6 is disclosed by the Receiving Party pursuant to
judicial order or governmental regulation or administrative process so long as
the Receiving Party notifies the Disclosing Party promptly before the disclosure
and cooperates with the Disclosing Party in the event that the Disclosing Party
decides to contest or limit the disclosure.

         12.3 To the extent any person that is subject to the restrictions set
forth in this Article is not a party to this Agreement, the terms of this
Article shall apply to such person to the same extent as if he, she or it were a
party hereto.

         12.4 In the event of any breach or threatened breach by any person of
any provision of this Article, the party harmed or likely to be harmed by such
breach or threatened breach shall be entitled to seek injunctive or other
equitable relief restraining such person from engaging in conduct that would
constitute a breach of the obligations of such person under this Article. Such
relief, if granted, shall be in addition to and not in lieu of any other
remedies that may be available, at law or equity, including an action for the
recovery of damages.

                                       21


                        ARTICLE 13 - TERM AND TERMINATION

         13.1 The initial term (the "Initial Term") of this Agreement shall be
from the Effective Date through December 31, 2007. Thereafter, the term of this
Agreement shall be extended automatically for additional twenty-four (24) month
periods (each, a "Renewal Term") unless and until either party provides the
other with at least twenty-four (24) months' prior written notice that this
Agreement shall expire at the end of the Initial Term or the upcoming Renewal
Term, as applicable.

         13.2 Either party may terminate this Agreement if the other party
breaches any material term, condition or provision of this Agreement and such
breach continues uncured for a period of forty-five (45) days (thirty (30) days
for nonpayment of amounts due and owing hereunder) after the breaching party's
receipt of written notice specifying the nature of the breach from the
terminating party; provided, however that if such breach is not reasonably
capable of cure within the applicable cure period, the breaching party shall
have an additional forty-five (45) days to cure such breach so long as the cure
is commenced within the applicable cure period and is diligently pursued to
completion thereafter.

         13.3 Either party may terminate this Agreement in the event of the
filing by or against the other party of a proceeding under any bankruptcy or
similar law, unless such proceeding is dismissed, within forty-five (45) days
from the date of filing; the making by the other party of a proceeding for
dissolution or liquidation, unless such proceeding is dismissed within
forty-five (45) days from the date of filing; the appointment of a receiver,
trustee or custodian for all or part of the assets of the other party, unless
such appointment or application is revoked or dismissed within forty-five (45)
days from the date thereof; the attempt by the other party to make any
adjustment, settlement or extension of its debts with its creditors generally;
or the insolvency of the other party.

         13.4 If UDC assigns or transfers this Agreement to a third party, then
PPG shall, within ninety (90) days following such event, have the right to
terminate this Agreement.

         13.5 If the Development Agreement is terminated prior to the expiration
of the Initial Term thereof, as such term is defined in the Development
Agreement, then subject to Section 13.6, this Agreement shall terminate upon
said termination of the Development Agreement.

         13.6 The provisions of Sections 6.1, 9.6, 13.6, 13.7 and 13.8 of this
Agreement, and of Articles 8, 10, 11, 12, 14 and 15 of this Agreement shall
survive its expiration or termination, as shall all payment and associated
provisions of Article 5 above respecting amounts paid or due and owing to PPG as
of the date of such termination.

         13.7 Upon any termination of this Agreement by PPG under Section 13.3
above, PPG shall be free to directly supply each UDC Licensee with its
requirements for Products then being supplied to such UDC Licensee through the
end of the then-current term (assuming this Agreement was not terminated), or
for a period of up to eighteen (18) months, whichever results in the longer
period of time. Said direct supply of Products to each such UDC Licensee shall
be on terms and conditions substantially equivalent to the terms and conditions
of this Agreement respecting the supply of such Products to UDC, and shall be
conditioned on such UDC Licensee agreeing in writing to be bound by the
provisions of this Agreement applicable thereto, including, without limitation,
the obligation to make payments to PPG under Article 5 above. For so long as PPG
exercises its rights under this Section, the license rights granted to PPG under
Article 9 shall survive and PPG shall remain subject to the obligations of
confidentiality and restrictive use under Article 12.

                                       22


         13.8 If this Agreement is terminated for any reason prior to the end of
the then-current term, PPG, upon the request of any UDC Licensee and subject to
the written approval of UDC, agrees to directly supply such UDC Licensee with
its requirements for Products then being supplied to such UDC Licensee through
the end of the then-current term (assuming this Agreement was not terminated),
or for a period of not less than eighteen (18) months, whichever results in the
shorter period of time. Said direct supply of Products to each such UDC Licensee
shall be on terms and conditions substantially equivalent to the terms and
conditions of this Agreement respecting the supply of such Products to UDC, and
shall be conditioned on such UDC Licensee agreeing in writing to be bound by the
provisions of this Agreement applicable thereto, including, without limitation,
the obligation to make payments to PPG under Article 5 above. For so long as PPG
performs its obligations under this Section, the license rights granted to PPG
under Article 9 shall survive and PPG shall remain subject to the obligations of
confidentiality and restrictive use under Article 12. Upon the request of any
UDC Licensee, PPG agrees to provide a letter to such UDC Licensee confirming
that PPG agrees to comply with the provisions of this Section respecting the
direct supply of Products to such UDC Licensee.

                              ARTICLE 14 - NOTICES

         All notices and requests in connection with this Agreement shall be in
writing and shall be transmitted via facsimile, with a copy thereof promptly
mailed, to the address(es) of the recipient as set forth below, or to such other
address(es) as the recipient shall specify in a notice given hereunder. Notices
shall be deemed given on the date of confirmation of facsimile transmission, if
such confirmation occurs on a business day of the recipient, or, if not, on the
next succeeding business day of the recipient.

         To PPG:

         PPG Industries, Inc.         PPG Industries, Inc.
         One PPG Place                One PPG Place
         Pittsburgh, PA 15272         Pittsburgh, PA  15272
         Attn.:  General Counsel      Attn:  Vice-President, Specialty Chemicals
         Fax:  412-434-2490           Fax:  412-434-2137

         With a copy to:            Reed Smith LLP
                                    435 Sixth Avenue
                                    Pittsburgh, PA  15219
                                    Attn: Jeffrey G. Aromatorio, Esquire
                                    Fax:  412-288-3063

                                       23


         To UDC:                    Universal Display Corporation
                                    375 Phillips Boulevard
                                    Ewing, NJ 08618
                                    Attn.: President and Chief Operating Officer
                                    Fax: 609-671-0995

         With a copy to:            Morgan, Lewis & Bockius LLP
                                    1701 Market Street
                                    Philadelphia, PA 19103-2921
                                    Attn: Stephen M. Goodman, Esquire
                                    Fax:  215-963-5299

                           ARTICLE 15 - MISCELLANEOUS

         15.1 If the performance of this Agreement by either party should be
prevented, delayed, restricted, or interfered with by any man-made or natural
catastrophe, or any other circumstances outside the control of such party and
not due to its negligence that is recognized under international commercial
practice as constituting a force majeure event, then the party so affected
shall, upon giving prompt notice of such event to the other party, be excused
from such performance to the extent of such prevention, delay, restriction, or
interference, provided that the party so affected shall use its best efforts to
avoid or remove such causes of nonperformance and promptly resume performance
hereunder when such causes have been removed. Upon such circumstances arising,
the parties shall promptly consult as to what, if any, modification to the terms
of the Agreement shall be required to arrive at an equitable solution; and, if
such nonperformance appears likely to continue for a period of time in excess of
thirty (30) days and the affected party's nonperformance appears likely to cause
serious hardship to the other party, such other party may terminate this
Agreement upon thirty (30) days' prior written notice to the affected party.

         15.2 Neither party may assign or transfer to any person, firm, or
corporation, any of its rights or obligations under this Agreement without the
prior written consent of the other party, except that either party may assign
this Agreement to an entity which acquires all or substantially all of its
assets or merges with it. Any prohibited assignment of this Agreement or the
obligations hereunder shall be null and void. No permitted assignment shall
relieve PPG or UDC of responsibility for the performance of any accrued
obligations which it has prior to such assignment. Any permitted assignment
shall obligate the assignee or successor in interest of PPG or UDC to be bound
by the terms and obligations of this Agreement. Subject to the foregoing, all of
the terms, conditions and provisions of this Agreement shall be binding upon and
shall inure to the benefit of each party's permitted successors and assigns.

         15.3 Except as expressly stated herein, nothing in this Agreement shall
confer any rights upon any person other than the parties hereto and their
respective permitted successors and assigns.

         15.4 PPG shall not use the names of Princeton University or USC in
connection with any products, promotion or advertising without the prior consent
of Princeton University or USC, except to the extent reasonably required by law.
Notwithstanding the foregoing sentence, PPG may state that certain of its rights
hereunder are sublicense rights under the Princeton License Agreement.

                                       24


         15.5 This Agreement will be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania, irrespective of its
provisions regarding conflicts of laws.

         15.6 This Agreement and the Development Agreement constitute the entire
agreement between the parties regarding the subject matter hereof. Neither party
has made any representation, promises or warranties not herein expressly stated.
This Agreement may not be modified except by a written instrument signed by both
parties to this Agreement.

         15.7 No waiver by any party of any condition, or the breach of any
term, covenant, agreement, representation, or warranty contained in this
Agreement, in any one or more instances, shall be deemed to be a further or
continuing waiver of any such condition or breach of any other term, covenant,
agreement, representation, or warranty contained in this Agreement.

         15.8 In the event a dispute, claim or controversy arises between the
parties relating to the validity, interpretation, performance, termination or
breach of this Agreement (collectively the "Dispute"), the parties agree to hold
a meeting, attended by the President of UDC and the Vice-President, Specialty
Chemicals of PPG, to attempt in good faith to negotiate a resolution of the
Dispute prior to pursuing other available remedies. If, within thirty (30) days
after such meeting (or such extended period of time as the parties may mutually
agree), the parties have not succeeded in negotiating a resolution of the
Dispute, the parties agree to submit the Dispute to mediation following
procedures of the American Arbitration Association ("AAA"), at which mediation
an individual of each party having decision-making authority respecting the
Dispute shall attend. The parties shall mutually agree on the selection process
for the mediator, the time and place for mediation, any exchange of information
and the conduct of the mediation. The fees of the mediator and the costs of
mediation shall be shared equally by the parties. If such mediation does not
result in an agreed upon resolution of the Dispute within sixty (60) days after
commencement of the mediation process (or such extended period of time as the
parties may mutually agree), either party shall be free to pursue any and all
remedies available to it, subject to the express limitations of Article 10
above. In the event of any Dispute involving termination of this Agreement by a
party, such termination shall be suspended for so long as the other party is
acting in good faith to resolve the Dispute in accordance with the provisions of
this Section. Nothing in this Section shall prohibit either party from seeking
equitable relief to restrain or prevent a breach of this Agreement at any time.

         15.9 If the final judgment of a court of competent jurisdiction
declares that any term or provision of this Agreement is invalid or
unenforceable, the parties agree that the court making the determination of
invalidity or unenforceability will have the power to reduce the scope, duration
or area of the term or provision, to delete specific words or phrases, or to
replace any invalid or unenforceable term or provision with a term or provision
that is valid and enforceable and that comes closest to expressing the intention
of the invalid or unenforceable term or provision, and this Agreement will be
enforceable as so modified after the expiration of the time within which the
judgment may be appealed.

                                       25


         15.10 In making and performing this Agreement, the parties are acting
and shall act as independent contractors. Neither party is, nor will be deemed
to be, an agent, legal representative, joint venturer, partner or employee of
the other party for any purpose.

         15.11 The parties shall agree on the language of any press releases or
public disclosures regarding the existence of this Agreement and/or its terms
and conditions. Language that has been approved by either party need not be
reapproved for subsequent release by the other party. Nothing in this Section
15.11 shall prevent either party from complying with any applicable securities
or other laws.

         15.12 This Agreement may be executed in two or more counterparts, each
of which shall be binding as of the Effective Date, and all of which shall
constitute one and the same instrument. Each such copy shall be deemed an
original, and it shall not be necessary in making proof of this Agreement to
produce or account for more than one such counterpart. This Agreement shall be
deemed executed by the parties when any one or more counterparts hereof,
individually or taken together, bears the signatures of each of the parties
hereto. This Agreement, once executed by a party, may be delivered to the other
party by facsimile transmission of a copy thereof that bears the signature of
the party so delivering it.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
Effective Date.



UNIVERSAL DISPLAY CORPORATION               PPG INDUSTRIES, INC.



By: /s/ Steven V. Abramson                  By: /s/ Howard I. Roe
   ----------------------------                --------------------------


NAME: Steven V. Abramson                    NAME: Howard I. Roe



TITLE: President                            TITLE: Director, Commercial
                                                   Development


DATE: October 31, 2000                      DATE: October 31, 2000






                                       26

                                                                    CONFIDENTIAL

                                    EXHIBIT A

                               PPG'S PRODUCT COSTS

CATEGORIES

Raw Materials or Second Supply Source Cost
Reactor and/or Purification Unit Time:
  Labor (Benefits, Employee Expenses, Training, Meeting Expense, Payroll admin)
  Operating Supplies (Office Supplies, Lab supplies, pilot plant)
  Manufacturing Unit Depreciation
  Maintenance
  Facilities Charges (Utilities and other service charges from group, storeroom)
  Software purchases and maintenance (DP services, computer center etc.)
  Professional Services (Safety, Process etc.)
Analytical Charges
Packaging Cost
  Containers
  Shipping boxes
  Labor



                                                                    CONFIDENTIAL

                                    EXHIBIT B

                              KNOWN OLED CHEMICALS

[The confidential material contained herein has been omitted and has been
separately filed with the Commission.]




FOR DISCUSSION PURPOSES ONLY                           DRAFT OF OCTOBER 23, 2000

                                    EXHIBIT C

                              UDC CHEMICAL PATENTS

[The confidential material contained herein has been omitted and has been
separately filed with the Commission.]