Exhibit 10.2


 


May 18,
2007


 


(Delivery by email and Overnight Courier)


 


Peter
Blackmore


[address]


 


Dear Peter


 


I am pleased to confirm UTStarcom’s job offer to you for
the position of President and Chief Operating
Officer, with a start date to be agreed upon. The terms and
conditions of this offer of employment are contingent upon the acceptance of
this letter by May 25, 2007 and commencement of your employment no later than
July 2, 2007.


 


This position reports directly to Hong Lu, the Company’s
current President and Chief Executive Officer, and is located at the Company’s
headquarters in Alameda, California. The following business units/functions
will report to you initially: International Sales, Marketing & Services, Global
Supply Chain, Global IT, Quality and the Network Solutions BU. The remaining
business units, namely Terminals BU and the PCD Division, will transfer to you
at a time mutually agreed upon between yourself and Mr. Lu. Within
approximately 12 months from your date of employment and in consultation with
Mr. Lu, the Board of Directors in its sole discretion may appoint you as the
Chief Executive Officer.


 


The key elements of this employment offer are as follows:


 


Salary:  Your annual salary is $800,000. 
Paydays are on the 15th and the last day of each month.  Direct
deposit is available. You will receive an annual performance review; however, your
salary will never be reduced below its current level.


 


Signing Bonus: You will be paid a signing bonus amount of $100,000, payable upon the commencement of your employment
with the Company.


 


Cash Payment Award: At this time, as you know, the Company is not in a position to make any
grants of equity awards. As a result, after you commence employment and upon
approval of the Board of Directors, the Company will grant you a restricted
cash award equal to $5.2 million, payable over a four (4) year period as
follows:  (i)  $4 million will vest as follows:  One quarter (25%) of the cash payment will
vest and become payable on each annual anniversary of your start date, subject
to your continuing to provide services to the Company through each applicable
vesting date and (ii) $1.2 million will vest as follows:  One quarter (25%) of the cash payment will
vest and become payable on the first anniversary of the date of grant, and the
remaining cash balance will vest in equal installments of 1/36th
each month thereafter, subject to your continuing to provide services to the
Company through each applicable vesting date. In the event of your death or
disability both amounts under clause (i) and (ii) above will accelerate in
full.


 


Annual Performance Bonus: On an annual basis, you will be eligible for an annual performance target
bonus (the “Annual Bonus”) of 100% of your base salary based upon (i) the Company’s
performance and (ii) achievement of mutually agreed upon performance objectives
determined by you and the Chief Executive Officer. For the 2007 fiscal year,
50% of the Annual Bonus amount will be guaranteed to you, and will be payable at
the time bonuses for the 2007 fiscal year are paid to other executives (but no
later than March 15, 2008).


 


Change in Control/Involuntary Termination
Agreement:  You will be offered an
agreement between yourself and the Company effective on the commencement of
your employment (the “COC Agreement”), in which the terms and conditions, in
part, provide as follows:


 

















 


a)             In the
event you remain employed with the Company through the twelve (12)
month-anniversary of the effective date of the COC Agreement (or a later date mutually
agreed upon in writing by the Board of Directors and you, but no later than
February 13, 2009) and you are not offered the position of Chief Executive
Officer of the Company on or before such date, you will receive: (i) twelve
(12) months of your base salary, (ii) payment of the full Annual Bonus for the
year, and (iii) full and complete acceleration of any outstanding restricted
cash awards and outstanding equity awards, if any, then unvested at the time of
the termination.


 


b)            In the
event of an Involuntary Termination (as such term is defined in the COC
Agreement) or a termination for Good Reason (as such term is defined in the COC
Agreement), you will receive (i) twelve (12) months of your base salary, (ii) payment
of the full Annual Bonus you would have otherwise been eligible to receive in
the year of termination, (iii) full and complete acceleration of any
outstanding restricted cash awards and outstanding equity awards, if any, then
unvested at the time of the termination and (iv) twelve (12) months from the
date of termination to exercise your equity awards; or


 


c)             In the
event of a  termination following a
Change of Control (as such term is defined in the COC Agreement), you will
receive (i) twenty four (24) months of your base salary, (ii) payment of two
times the full Annual Bonus you would have otherwise been eligible to receive in
the year of termination (in addition, a pro rated amount of the full Annual
Bonus will be paid for the year of termination), and (iii) full and complete
acceleration of any outstanding restricted cash awards and outstanding equity
awards, if any, then unvested at the time of the termination and (iv) twelve
(12) months from the date of termination to exercise your equity awards.


 


Such payments and benefits will be payable at such times
and in accordance with the terms and conditions of the COC Agreement.


 


Paid Time Off (PTO):  You will be provided
at the inception of your employment with an accrual rate for PTO equivalent to 20
days per year. This will continue during your employment with the Company
pursuant to the Company’s policies relating to PTO accrual and use.


 


Please be prepared to provide proof of eligibility for
employment in the United States on your first day of work, in compliance with
the Immigration Reform and Control Act (Form I-9).  Additionally, this offer of employment
is contingent upon completion of both personal reference verifications, and a
criminal background check.  UTStarcom reserves the right to withdraw its  offer of employment to you if the results
of the reference verifications and/or the criminal background check are not
satisfactory, in the sole judgment of UTStarcom.


 


Your employment with the Company will be “at will” and
subject to the terms herein. This means that your employment with the Company may
be terminated by either you or the Company at any time, for any reason or for
no reason, with or without notice. This offer supersedes all prior offers, both
written and verbal.


 


As an employee of the Company, you will be expected to
abide by Company rules and regulations. You will be expected to sign and comply
with an agreement, which requires, among other provisions, the non-disclosure
of proprietary information.


 


Under separate cover I will forward to you the following
materials for your review: a proposed Change in Control/Involuntary Termination
Agreement (as described above); a proposed Indemnification Agreement; a
Director and Officers’ Questionnaire; and a Power of Attorney regarding outside
counsel’s filing of SEC Forms 3/4/5 on your behalf.


 


This letter shall be governed by the laws of the State of
California.


 


We are pleased that you have chosen to become part of the
UTStarcom team, and wish you the very best as you begin your employment with
UTStarcom. If you have any questions about UTStarcom or its 


 

















 


benefit programs, please feel free to contact Mark Green at
510-749-1565 (or mark.green@utstar.com).


 


Please sign one copy of this letter to indicate your intent
to accept the terms and conditions of this offer letter, and please return the
signed copy to the Human Resource Department confidential fax at (510) 814-XXXX.


 


	
  Sincerely,

  
	
   

  
	
  /s/
  Edward Hudson

  	
   

  
	
   

  
	
  Edward
  Hudson

  
	
  Senior
  Director Human Resources

  



 


I
accept the terms and conditions of this offer letter, and I understand that it
replaces those of any earlier offers of employment (if any).


 


	
  Signed:

  	
  /s/ Peter Blackmore

  	
   

  
	
   

  	
  Employee
  Signature

  	
   

  
	
   

  
	
  Print
  Name:

  	
  Peter Blackmore

  	
   

  
	
  Date:

  	
  May 27, 2007