Business Context and Reporting Period
Company: Universal Display Corporation
Filing Type: Form 8-K (Current Report)
Report Date: February 7, 2011
Event Date: February 4, 2011
Context: The company entered into a Material Definitive Agreement with Moser Baer Technologies, Inc. (MBT) to expand its OLED lighting business through licensing, material supply, and technical cooperation.
Key Financial Metrics
This filing is a current report regarding a material agreement and does not contain financial statements. Consequently, specific values for revenue, profit, cash flow, margins, debt, and liquidity are not provided in this document.
Material Changes and Agreement Details
On February 4, 2011, Universal Display Corporation entered into a Memorandum of Agreement with MBT comprising three distinct components:
- License Agreement: MBT received a non-exclusive license to use Universal Display's patents and know-how to manufacture and sell specified organic light emitting device (OLED) lighting products.
- Commercial Material Supply Agreement: Universal Display agreed to sell proprietary OLED materials to MBT for the production of licensed products.
- Technical Cooperation Agreement: A five-year program was established for Universal Display to support MBT in manufacturing white phosphorescent OLED lighting products.
Revenue Model: MBT is obligated to pay license fees, running royalties on sales of licensed products, fees for technical program work, and payments for purchased OLED materials.
Guidance, Outlook, and Risks
Outlook: The agreement signals a strategic expansion into the OLED lighting market through a partnership with MBT, creating potential future revenue streams via royalties and material sales.
Risks and Contingencies: The filing does not explicitly detail specific risks or contingencies associated with this agreement beyond the standard obligations of the contracts. The success of the revenue model depends on MBT's ability to manufacture and sell the licensed products.
Key Facts for Investor Verification
- Verify the specific terms of the royalty rates and license fees in the full agreement text.
- Monitor MBT's progress in manufacturing and commercializing white phosphorescent OLED lighting products over the five-year cooperation period.
- Assess the impact of this partnership on Universal Display's future revenue mix between display and lighting applications.
- Confirm whether this agreement triggers any specific accounting recognition for upfront payments or deferred revenue.