Avery Dennison and Advanced Display Systems Announce Agreement to Develop Liquid Crystal Technology for the Display Products Market

Avery Dennison Chemical Divisions%> (NYSE/PCX:AVY) and Advanced Display Systems, Inc., announced that they have entered into an exclusive license agreement for a new display technology which will provide opportunities to enter the display systems market. The technology, known as Fast Multistable Liquid Crystal Display (FMLCD), will enable Avery Dennison to develop display products on flexible substrates that are used in mobile electronics applications.

"We look forward to this strategic alliance with Advanced Display Systems," said Marc Heritage, vice president of electronics business development at Avery Dennison. "Joining forces will combine Avery Dennison's innovative research capabilities and manufacturing strengths with Advanced Display Systems' liquid crystal technical expertise to produce display products for use in mobile electronics, such as cell phones, pagers, digital cameras, electronic books and personal digital assistants."

Displays using FMLCD technology will feature a variety of attributes compared with other display systems, including the ability to display shades of gray for improved photographic images, lower power consumption, a memory function which retains the image on the display after power is turned off and higher contrast, particularly in bright light. FMLCD technology can be used in many display applications from simple smart cards to computer video displays to outdoor electronic billboards.

Avery Dennison's core competencies provide the foundation from which the Company is planning to develop and launch products for this new market, including its capabilities in coating, roll-to-roll processing, lamination, microreplication technology, adhesive formulations and high-volume manufacturing capacity. Future growth in many segments of the display industry will be based on the ability to produce conformable, impact-resistant plastic displays on a continuous roll-to-roll production line, which is a key Avery Dennison manufacturing capability.

While Avery Dennison's first display products will be monochromatic, the Company has established a multigenerational product development program with Advanced Display Systems designed to facilitate the expansion of its range of products in the growing display market.

"This license agreement marks a significant event in our efforts to commercialize FMLCD technology," said Dr. Bao Gang Wu, president and chief executive officer of Advanced Display Systems. "We have established that FMLCD is the best performing cholesteric technology in the world, and working closely with Avery Dennison will allow consumers purchasing mobile electronics products to benefit from it."

Avery Dennison is a global leader in pressure-sensitive technology and innovative self-adhesive solutions for consumer products and label materials. Based in Pasadena, Calif., the Company had 1999 sales of $3.8 billion. Avery Dennison develops, manufactures and markets a wide range of products for consumer and industrial markets, including Avery-brand office products, Fasson-brand self-adhesive materials, peel-and-stick postage stamps, battery labels, reflective highway safety products, automated retail tag and labeling systems, and specialty tapes and chemicals.

Advanced Display Systems, founded in 1992, is a high-technology company, developing new flat panel display technologies. Originally generating revenue from an LCD production equipment operation, the privately-held company raised its first round of venture capital in 1997 from a consortium of Taiwan-based investors. Based in Amarillo, Texas, the company has made significant investment over a period of approximately seven years to develop FMLCD technology.