CAMBRIDGE DISPLAY TECHNOLOGY, INC. RESTRICTED UNITS AGREEMENT

RSU Agreement

Executive Retention Bonus

UK Employees

CAMBRIDGE DISPLAY TECHNOLOGY, INC.
RESTRICTED UNITS AGREEMENT
(FOR UK EMPLOYEES)

THIS AGREEMENT is made on 29 January 2007

BETWEEN:-

(1) CAMBRIDGE DISPLAY TECHNOLOGY, INC, a Delaware corporation (the "Company") and

(2) [INSERT NAME] (the "Employee")            

IT IS AGREED as follows:-

1.        DEFINITIONS AND INTERPRETATION

1.1        The words and expressions set out below have the meanings specified against them:

"the Award"        the award of Restricted Units granted to the Employee under the terms of this Agreement, as set out in Schedule 1 and in accordance with Article V of the Plan;

"the Board"         the Board of Directors of the Company from time to time;

"Change in Control"                        as defined in the Plan;

"the Committee"        the Compensation Committee of the Board from time to time or, following a Change in Control, those persons who comprised the Compensation Committee of the Board immediately prior to such Change in Control;

"the Date of Grant"        the date on which the Award was granted, as set out in Schedule 1 to this Agreement;

"Dividend Equivalents"        as defined in the Plan;

"the Employer"        such member of the Group that is the Employee's employer, or if he has ceased to hold an office or employment within the Group, was his employer or such other member of the Group, or other person, as under the PAYE Regulations or, as the case may be, the NICs Regulations or any other statutory or regulatory enactment (whether in the UK or otherwise) and is obliged to account or would suffer a disadvantage should it not account for any Tax Liability;

"Employer's NICs"        secondary Class 1 National Insurance contributions payable by (or by reference to) the Employer;

"Employee's NICs"        primary Class 1 National Insurance contributions payable by (or by reference to) the Employee;

"Fair Market Value"        the Fair Market Value (as defined in the Plan) of the Shares in respect of which the Award has Vested calculated on the Vesting Date;

"Group"        the Company (and any successor thereto) and any company which is for the time being a Subsidiary of the Company (as defined in the Plan);

"HMRC"        the UK HM Revenue & Customs;

"ITEPA"                                the UK Income Tax (Earnings and Pensions) Act 2003;
      
"the Liquidity Date"        the date or dates on or after which the Shares acquired on Vesting of the Award may be sold by the Employee without restriction, as set out in Schedule 1 to this Agreement;

"NICs Regulations"        the regulations made for the assessment, collection and recovery of national insurance contributions under Schedule 1 of the Social Security (Contributions & Benefits Act 1992;

"Nominated Broker"        a broker nominated by the Committee from time to time and notified as such to the Employee for the purposes of clause 7 of this Agreement;

"PAYE Regulations"        the regulations made for the assessment, collection and recovery of income tax under section 684 of ITEPA;

"Period of Restriction"                means the period of time between the Date of Grant and the Vesting Date as set out in Schedule 1 to this Agreement;

"Plan"                                the Cambridge Display Technology, Inc. 2004 Stock Incentive Plan,

"Restricted Units"                    a forfeitable right to receive the Shares;

"Shares"                         the number of shares of class A common stock of the Company (with a par value of $0.01 per share) set out in Schedule 1 to this Agreement;

"the Stock Acquisition Date"        the date or dates on which the Shares will be issued following Vesting of the Award as set out in Schedule 1 to this Agreement;

"Tax Liability"                        any liability of the Employer to withhold the statutory minimum of withholding tax due and/or account to HMRC (or any other tax authority in any jurisdiction) for an amount of, or representing, income tax, Employee's NICs and, if expressly referred to in Schedule 1 to this Agreement, Employer's NICs and/or any other tax or social security contributions charge, levy or sum (whether under the laws of the UK or otherwise) which may arise in respect of the Award (whether pursuant to its grant or Vesting, the acquisition or holding of the Shares or otherwise);

"UK"                                United Kingdom;

"Vesting"                        the date on which the Period of Restriction ends (the "Vesting Date") as set out in Schedule 1 to this Agreement (and "Vest" and "Vested" shall be construed accordingly).
                        
1.2        Words and phrases not otherwise defined in this Agreement shall have the meanings given to them in the Plan.

1.3        References in this Agreement to a statute or a statutory provision shall include any modification, re-enactment or extension thereof.

2.        GRANT OF AWARD        

2.1        Subject to the terms and conditions of this Agreement and of the Plan, the Committee hereby grants to the Employee the Award in consideration of the Employee's continuing duties and obligations to the Company from the Date of Grant.

2.2        The Award is personal to the Employee and may not be transferred, assigned, mortgaged, charged or otherwise disposed of and shall immediately become void and of no effect in the event of the bankruptcy of the Employee.

2.3        The grant of the Award shall be conditional upon the Employee duly executing and returning to the Company a copy of this Agreement, together with any further documentation specified in Schedule 1.

3.        VESTING OF THE AWARD

3.1        Subject to clauses 5 and 6 below, the Employee's Award shall Vest fully on the Vesting Date.

3.2        Upon Vesting of the Award the Employee will become entitled to receive the Shares in respect of which the Award has Vested on the Stock Acquisition Date and the Company shall arrange for such Shares to be delivered to the Employee within 30 days of the Stock Acquisition Date (subject to clause 8 below).

4. &nbs