<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1998
( ) TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to _________
Commission File No. 0-28146
UNIVERSAL DISPLAY CORPORATION
-----------------------------
(Exact name of small business issuer as specified in its charter)
PENNSYLVANIA 23-2372688
-------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
THREE BALA PLAZA EAST
SUITE 104
BALA CYNWYD, PA 19004
--------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(610) 617-4010
-----------------------------------------------
(Issuer's telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports)
and (2) has been subject to such filing requirements for the past 90 days.
Yes _X_ No __
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15 (d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.
Yes __ No __
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
As of September 30, 1998, the registrant had outstanding 10,312,943 shares of
common stock, par value $.01 per share.
Transitional Small Business Disclosure Format (check one):
Yes __ No _X_
1
<PAGE>
<TABLE>
<CAPTION>
INDEX PAGE
- ----- ----
<S> <C>
Part I - Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets -
September 30, 1998 (unaudited) and December 31, 1997 3
Consolidated Statements of Operations - Three months
ended September 30, 1998 and 1997, and inception to September 30, 1998 (unaudited) 4
Consolidated Statement of Operations - Nine months 5
ended September 30, 1998 and 1997, and inception to September 30, 1998 (unaudited)
Consolidated Statements of Cash Flows - Nine months
ended September 30, 1998 and 1997, and inception to September 30, 1998 (unaudited) 6
Notes to Consolidated Financial Statements (unaudited) 7-9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
Part II - Other Information
Item 6. Exhibits and Reports on Form 8-K. 11
</TABLE>
2
<PAGE>
PART I. - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- -----------------------------
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARY
--------------------------------------------
(a development-stage company)
CONSOLIDATED BALANCE SHEETS
---------------------------
<TABLE>
<CAPTION>
ASSETS September 30, 1998 December 31, 1997
(unaudited)
------------------------- ----------------------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents (See Note 2) $ 54,491 $ 85,470
Short-term investments (See Note 2) 2,910,295 4,539,570
Contract research receivables 83,481 88,366
Receivable from related party 51,906 51,906
Prepaid consulting fee 334,906 428,985
Other current assets 101,101 89,806
------------ ------------
Total current assets 3,536,180 5,284,103
------------ ------------
PROPERTY AND EQUIPMENT, net of accumulated
depreciation of $63,336 and $39,353 44,355 57,401
DEPOSITS 76,073 76,073
------------ ------------
Total assets $ 3,656,608 $ 5,417,577
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 214,288 $ 280,240
------------ ------------
SHAREHOLDERS' EQUITY
Preferred Stock, par value $0.01 per share,
5,000,000 shares authorized, 200,000 shares
designated
Series A Nonconvertible Preferred
Stock, par value $.01 per share, 200,000 issued
and outstanding (liquidation value of $1,500,000) 2,000 2,000
Common Stock, par value $.01 per share, 25,000,000 shares
authorized, 10,312,943 and 10,302,268 issued and
outstanding (see Note 2) 103,130 103,023
Additional paid-in capital 15,817,965 15,812,809
Deficit accumulated during development-stage (12,480,775) (10,780,495)
------------ ------------
Total shareholders' equity 3,442,320 5,137,337
------------ ------------
Total liabilities and shareholders' equity $ 3,656,608 $ 5,417,577
============ ============
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE>
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARY
--------------------------------------------
(a development-stage company)
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
(unaudited)
<TABLE>
<CAPTION>
Period from Inception
Three Months Ended (June 17, 1994) to
September 30, 1998 September 30, 1998
------------------ ------------------
1998 1997
---- ----
<S> <C> <C> <C>
REVENUE:
Contract research revenue $ 83,341 $ -- $ 375,311
----------- --------- ------------
OPERATING EXPENSES:
Research and development (See Note 3) 426,270 210,598 8,101,725
General and administrative 436,000 511,652 5,193,310
--------- ------------
Total operating expenses 862,270 722,250 13,295,035
----------- --------- ------------
Operating loss (778,929) (722,250) (12,919,724)
INTEREST INCOME 32,415 25,480 438,949
----------- --------- ------------
NET LOSS $ (746,514) $ (696,770) $ (12,480,775)
----------- --------- ------------
BASIC AND DILUTED NET LOSS PER COMMON SHARE
$ (0.07) $ (0.08)
----------- ---------
WEIGHTED AVERAGE SHARES USED IN COMPUTING
BASIC AND DILUTED NET LOSS PER COMMON SHARE
10,312,583 9,150,689
---------- ---------
</TABLE>
The accompanying notes are an integral part of these statements.
4
<PAGE>
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARY
--------------------------------------------
(a development-stage company)
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
(unaudited)
<TABLE>
<CAPTION>
Nine Months Period From
Ended September 30, Inception
------------------- (June 17, 1994) to
1998 1997 September 30, 1998
---- ---- ------------------
<S> <C> <C> <C>
REVENUE:
Contract research revenue $ 281,706 $ -- $ 375,311
----------- ----------- ------------
OPERATING EXPENSES:
Research and development (See Note 3) 871,520 924,075 8,101,725
General and administrative 1,257,898 1,288,985 5,193,310
----------- ----------- ------------
Total operating expenses 2,129,418 2,213,060 13,295,035
----------- ----------- ------------
Operating loss (1,847,712) (2,213,060) (12,919,724)
----------- ----------- ------------
INTEREST INCOME $ 147,432 $ 106,617 $ 438,949
----------- ----------- ------------
NET LOSS $ (1,700,280) $ (2,106,443) $ (12,480,775)
----------- ----------- ------------
BASIC AND DILUTED NET LOSS PER
COMMON SHARE $ (0.17) $ (0.23)
----------- -----------
WEIGHTED AVERAGE SHARES USED IN
COMPUTING BASIC AND DILUTED NET
LOSS PER COMMON SHARE 10,309,481 9,009,190
----------- -----------
</TABLE>
The accompanying notes are an integral part of these statements.
5
<PAGE>
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARY
(a development-stage company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Nine Months Period from Inception
Ended September 30, (June 14, 1994) to
1998 1997 September 30, 1998
---- ---- ------------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss ($1,700,280) ($2,106,443) (12,480,775)
Depreciation 23,983 23,955 63,336
Amortization of Prepaid consulting fees 94,079 -- 94,079
Issuance of Common Stock options and warrants -- 100,000 350,950
Issuance of Common Stock and warrants in connection
with amended research and license agreements -- -- 3,120,329
Acquired in-process technology -- -- 350,000
Adjustments to reconcile net loss to net cash used in
operating activities:
(Increase) decrease in assets:
Contract research receivables 4,885 -- (83,481)
Receivable from related party -- -- (51,906)
Other current assets (11,295) 26,983 (101,101)
Deposits -- 17,346 (76,073)
Increase (decrease) in liabilities:
Accounts payable and accrued expenses (65,952) 20,413 170,128
Payable to related parties -- -- 250,000
-- -- -------
Net cash used in operating activities (1,654,580) (1,917,746) (8,394,514)
----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of equipment (10,937) (8,475) (107,691)
Purchases of short-term investments -- -- (7,449,570)
Proceeds from sale of short-term investments 1,629,275 1,281,000 4,539,275
----------- ----------- -----------
Net cash provided by (used in) investing activities 1,618,338 1,272,525 (3,017,986)
----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of Common Stock 5,263 3,903,350 11,466,991
----------- ----------- -----------
INCREASE/DECREASE IN CASH AND CASH EQUIVALENTS
(30,979) 3,258,129 54,491
CASH AND CASH EQUIVALENT, BEGINNING OF PERIOD
85,470 638,225 0
----------- ----------- -----------
CASH AND CASH EQUIVALENTS, END OF PERIOD: $ 54,491 $3,896,354 $ 54,491
=========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
6
<PAGE>
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARY
(a development-stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
NOTE 1. - BACKGROUND
Universal Display Corporation (the "Company"), a development-stage company,
is engaged in the research and development and commercialization of organic
light emitting diode ("OLED") technology for flat panel display applications.
The Company, formerly known as Enzymatics, Inc. ("Enzymatics"), was incorporated
under the laws of the Commonwealth of Pennsylvania on April 24, 1985 and
commenced its current business activities on August 1, 1994. The New Jersey
corporation formerly known as Universal Display Corporation ("UDC") was
incorporated under the laws of the State of New Jersey on June 17, 1994.
Research and development of the OLED technology is being conducted at the
Advanced Technology Center for Photonics and Optoelectronic Materials at
Princeton University and at the University of Southern California ("USC") (on a
subcontract basis with Princeton University), pursuant to a Sponsored Research
Agreement dated August 1, 1994, as amended (the "1994 Sponsored Research
Agreement"), originally between the Trustees of Princeton University ("Princeton
University") and American Biomimetics Corporation ("ABC"), a privately held
Pennsylvania corporation and affiliate of the Company. In October 1997, the
Company entered into a new 5-year Sponsored Research Agreement (the "1997
Sponsored Research Agreement") for OLED technology (see Note 3). Pursuant to a
license agreement dated August 1, 1994 (the "1994 License Agreement") between
Princeton University and ABC, assigned to the Company by ABC in June 1995, the
Company has a worldwide exclusive license to manufacture and market products
based on Princeton University's pending patent application relating to the OLED
technology and the right to obtain a similar license to inventions conceived or
discovered under the 1994 Sponsored Research Agreement and to sublicense such
rights. In October 1997, the Company amended the 1994 license agreement (the
"1997 Amended License Agreement") in which certain terms were modified (see Note
3). The Company's Chairman and Chief Executive Officer holds similar positions
in ABC, a company which is controlled by members of his family.
The Company is a development-stage entity with no significant operating activity
to date. Expenses incurred have primarily been in connection with research and
development funding, obtaining financing and administrative activities. The
developmental nature of the activities is such that significant inherent risks
exist in the Company's operations. Completion of the commercialization of the
Company's technology will require funds substantially greater than the Company
currently has available. There can be no assurance that such financing will be
available to the Company when needed, on commercially reasonable terms or at
all. The Company anticipates, based on management's internal forecasts and
assumptions relating to its operations, that it has sufficient cash to meet its
obligations for at least the current fiscal year. To the extent that Princeton
University's research efforts do not result in the development of commercially
viable applications for the OLED technology, the Company will not have any
meaningful operations. Even if a product incorporating the OLED technology is
developed and introduced into the marketplace, additional time and funding may
be necessary before significant revenues are realized. While the Company funds
the OLED technology research, the scope of and technical aspects of the research
and the resources and efforts directed to such research is subject to the
control of Princeton University and the principal investigators. Accordingly,
the Company's success is dependent on the efforts of Princeton University and
the principal investigators. The 1997 Sponsored Research Agreement provides that
if certain of the principal investigators are unavailable to continue to serve
as a principal investigator, because such person is no longer associated with
Princeton University or otherwise, and a successor acceptable to both the
Company and Princeton University is not available, the 1997 Sponsored Research
Agreement will terminate.
7
<PAGE>
NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY FINANCIAL INFORMATION AND RESULTS OF OPERATIONS
INTERIM FINANCIAL INFORMATION
In the opinion of the Company, the accompanying unaudited Consolidated Financial
Statements contain all adjustments (consisting of only normal recurring
adjustments) necessary to present fairly the financial position as September 30,
1998, the results of operations for the three months and nine months ended
September 30, 1998 and 1997, and the cash flows for the nine months ended
September 30, 1998 and 1997.
While the Company believes that the disclosures presented are adequate to make
the information not misleading, these Consolidated Financial Statements should
be read in conjunction with the Consolidated Financial Statements and the notes
in the Company's latest year end financial statements, which were included in
the Company's Annual Report Form 10-KSB for the year ended December 31, 1997.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of Universal Display
Corporation and its wholly-owned subsidiary, UDC, Inc. All significant
intercompany transactions and accounts have been eliminated.
MANAGEMENT'S USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS
The Company considers all highly liquid debt instruments purchased with an
original maturity of three months or less to be cash equivalents. Investments
are carried at market value, and at September 30, 1998 and December 31, 1997,
are classified as short-term investments. At September 30, 1998 and December 31,
1997, all of the Company's investments are classified as available for sale
pursuant to Statement of Financial Accounting Standards No. 115, "Accounting for
Certain Investments in Debt and Equity Securities," (SFAS 115). Therefore, any
unrealized holding gains or losses should be presented as a separate component
of shareholders' equity. At September 30, 1998 and December 31, 1997, unrealized
holding gains or losses were not material.
EQUIPMENT
Equipment is stated at cost and depreciated on a straight-line basis over 3
years.
NET LOSS PER COMMON SHARE
The Company has adopted Statement of Financial Accounting Standards No. 128
(SFAS 128), "Earnings per Share", which superscedes APB Opinion No. 15,
"Earnings per Share." SFAS 128 requires dual presentation of basic and diluted
earnings per share (EPS) for complex capital structures on the face of the
Statement of Operations. Basic EPS is computed by dividing income by the
weighted-average number of common shares outstanding for the period. Diluted EPS
reflects the potential dilution from the exercise or conversion of securities
into common stock.
Options and warrants to purchase common stock were outstanding during the three
month and nine month periods ended September 30, 1998 and 1997 are not included
in the computation of diluted net loss per share because they are antidilutive.
RESEARCH AND DEVELOPMENT
Expenditures for research and development expense are charged to operations as
incurred.
8
<PAGE>
NEW ACCOUNTING PRONOUNCEMENT
Effective January 1, 1998, the Company adopted Statement of Financial Accounting
Standards No. 130, "Reporting Comprehensive Income" ("SFAS 130"). SFAS 130
requires the reporting of comprehensive income in addition to net income from
operations. The Company has reviewed SFAS 130 and has determined that for the
three and nine months ended September 30, 1998 and 1997, no items meeting the
definition of comprehensive income as specified in SFAS 130 existed in the
financial statements.
NOTE 3. - SPONSORED RESEARCH AGREEMENT WITH PRINCETON UNIVERSITY
On October 9, 1997, the Company entered into a new 5-year Sponsored Research
Agreement (the "1997 Sponsored Research Agreement), with Princeton University
and entered into an Amended License Agreement with Princeton University and USC
amending its 1994 License Agreement with Princeton University (the "1997 Amended
License Agreement). The 1997 Sponsored Research Agreement continues and expands
the sponsored research which commended in 1994 (the "1994 Sponsored Research
Agreement") under which the Company funds additional research and development
work at Princeton University (and at USC under a subcontract with Princeton
University) in OLED technology. The 1997 Sponsored Research Agreement requires
the Company to pay up to $4.4 million commencing on July 31, 1998 through July
31, 2002, which period is subject to extension. The amounts due to Princeton
University will be expensed when paid by the Company. Under the 1997 License
Agreement, the Company has the exclusive worldwide license to manufacture and
market products, and to sublicense those rights, based on Princeton University's
and USC's pending patent applications relating to the OLED technology and
conceived under the 1994 Sponsored Research Agreement, and to inventions
conceived or discovered under the 1997 Sponsored Research Agreement. The Company
is required to pay Princeton University a royalty in the amount of 3% of the
Company's net sales of products utilizing the OLED technology. In circumstances
where the Company sublicenses the OLED technology (except to affiliates), the
royalty required to be paid by the Company was reduced from 50% to 3%. These
royalty rates are subject to upward adjustments under certain conditions. In
connection with the 1997 License Agreement and Sponsored Research Agreement, in
October 1997, the Company has issued 140,000 common shares and 175,000 warrants
to purchase common stock to Princeton University as well as 60,000 common shares
and 75,000 warrants to purchase common stock to the University of Southern
California.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This document contains certain forward-looking statements that are
subject to risks and uncertainties. Forward-looking statements include certain
information relating to forecasts regarding the Company's future working capital
needs and the extension of agreements relating to the Company's intellectual
property, as well as information contained elsewhere in this Report where
statements are preceded by, followed by or include the words "believes",
"expects", "anticipates", "potential" or similar expressions. For such
statements, the Company claims the protection of the safe harbor for
forward-looking statements contained in the Private Securities Litigation Reform
Act of 1995. Actual events or results may differ materially from those discussed
in forward-looking statements as a result of various factors, including without
limitation, those discussed elsewhere herein.
GENERAL
Since inception, the Company has been engaged, and for the foreseeable future
expects to continue to be engaged, exclusively in funding research and
development activities related to the OLED technology and attempting to
commercialize such technology. To date, the Company has not generated any
revenues and does not expect to generate any meaningful revenues for the
foreseeable future and until such time, if ever, as it successfully demonstrates
that the OLED technology is commercially viable for one or more flat panel
display applications and enters into license agreements with third parties with
respect to the technology. The Company has incurred significant losses since its
inception, resulting in an accumulated deficit of $12,480,775 at September 30,
1998. The rate of loss is expected to increase as the Company's activities
increase and losses are expected to continue for the foreseeable future and
until such time, if ever, as the Company is able to achieve sufficient levels of
revenue from the commercial exploitation of the OLED technology to support its
operations.
9
<PAGE>
RESULTS OF OPERATIONS
Three Months Ended September 30, 1998 Compared to Three Months Ended
September 30, 1997
The Company had a net loss of $746,514 (or $.07 per share) for the quarter ended
September 30, 1998 compared to a loss of $696,770 (or $0.08 per share) for the
same period in 1997. The increase in the net loss was attributed to increased
research and development costs. The Company earned $83,341 from contract
research revenue in the quarter ended September 30, 1998 compared to no revenue
in the same period in 1997. The revenue was derived primarily from a $100,000
grant from the New Jersey Commission on Science and Technology to continue
development of OLED technology and to study manufacturing development issues,
from a $100,000 Phase I STTR grant from the National Science Foundation, and
additionally from a subcontract under a 3-year, $3 million contract Princeton
University received from the Defense Advanced Research Project Agency.
Research and development costs were $426,270 for the quarter ended September 30,
1998 compared to $210,598 for the same period in 1997. Research and development
costs were higher in 1998 compared to 1997 primarily because of an increase in
research being performed at Princeton University and by employees of the Company
and increased patent expenses. In 1997, research and development costs consisted
primarily of patent expenses and payments under the 1994 Sponsored Research
Agreement.
Nine Months Ended September 30, 1998 Compared to Nine Months Ended
September 30, 1997
The Company had a net loss of $1,700,280 (or $.17 per share) for the nine months
ended September 30, 1998 compared to a loss of $2,106,443 (or $.23 per share)
for the same period in 1997. The decrease of $406,163 was primarily attributed
to increased contract revenue in 1998 of $281,706 and to a decrease in research
and development expenses due to the payment schedule of the 1997 Sponsored
Research Agreement.
Research and development costs were $871,520 for the nine months ending
September 30, 1998 compared to $924,075 for the same period in 1997. The 1998
costs were primarily associated with the research being performed at Princeton
University, by employees of the Company and patent expenses. The 1997 costs were
primarily associated with payments to Princeton University under the 1994
Sponsored Research Agreement and patent costs.
Liquidity and Capital Resources
As of September 30, 1998, the Company had cash of $54,491 and short-term
investments of $2,910,295 compared to cash of $85,470 and short-term investments
of $4,539,570 at December 31, 1997. During 1997, private placement warrants to
purchase 1,124,000 shares of the Company's Common Stock were exercised,
resulting in net cash proceeds of $3,940,800 to the Company.
The Company anticipates, based on management's internal forecasts and
assumptions relating to its operations (including assumptions regarding working
capital requirements of the Company, the progress of research and development,
the availability and amount of other sources of funding available to Princeton
University for research relating to the OLED technology and the timing and costs
associated with the preparation, filing and prosecution of patent applications
and the enforcement of intellectual property rights) that it has sufficient cash
to meet its obligations until at least June 30, 1999. Management believes that
additional financing sources for the Company include long and short borrowings,
public and private equity and the exercise of warrants. The 1997 Sponsored
Research Agreement requires the Company to pay up to $4.4 million to Princeton
University from July 1998 through July 2002, which period is subject to
extension. Substantial additional funds will be required thereafter for the
research, development and commercialization of OLED technology, obtaining and
maintaining intellectual property rights, working capital and other purposes,
the timing and amount of which is difficult to ascertain. There can be no
assurance that additional funds will be available when needed, or if available,
on commercially reasonable terms.
The Company is currently in the process of evaluating its information technology
infrastructure for Year 2000 compliance. The Company does not expect that the
cost to modify such infrastructure to Year 2000 compliance will be material to
its financial condition or results of the operations. The Company does not
anticipate any material disruption in its operations as a result of any failure
by the Company to be in compliance.
10
<PAGE>
PART II. - OTHER INFORMATION
ITEM 1. NONE
ITEM 2. NONE
ITEM 3. NONE
ITEM 4. NONE
ITEM 5. NONE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS:
Exhibit Number
- --------------
27 Financial Data Schedule
(B) REPORTS ON FORM 8-K:
None to report.
11
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
UNIVERSAL DISPLAY CORPORATION
/s/ Sidney D. Rosenblatt
Date: November 15, 1998 -------------------------------
Sidney D. Rosenblatt
(Executive Vice President, Chief
Financial Officer, Treasurer and
Secretary)
12
<PAGE>
EXHIBIT INDEX
Exhibit Sequential
Number Description Page No.
- ------ ----------- --------
27 Financial Data Schedule 15
13
<PAGE>
November 15, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Quarterly Report of Universal Display Corporation on Form 10-QSB
Ladies and Gentlemen:
Enclosed for filing on behalf of Universal Display Corporation is a copy of the
Quarterly Report of Universal Display Corporation on Form 10-QSB for the period
ended September 30, 1998.
Sincerely,
Sidney D. Rosenblatt
Executive Vice President and Chief Financial Officer
SDR:kss
Enclosure
cc: Steven V. Abramson
Stephen M. Goodman, Esq.
Alan Singer, Esq.
14
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 54,491
<SECURITIES> 2,910,295
<RECEIVABLES> 83,481
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,536,510
<PP&E> 44,355
<DEPRECIATION> 63,336
<TOTAL-ASSETS> 3,656,608
<CURRENT-LIABILITIES> 214,288
<BONDS> 0
0
2,000
<COMMON> 103,130
<OTHER-SE> 3,442,320
<TOTAL-LIABILITY-AND-EQUITY> 3,656,608
<SALES> 281,706
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 871,520
<OTHER-EXPENSES> 1,257,898
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,847,712)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,847,712)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,700,280)
<EPS-PRIMARY> (0.17)
<EPS-DILUTED> (0.17)
</TABLE>
