Exhibit 10.3


UTSTARCOM,
INC.


2006
EQUITY INCENTIVE PLAN


STOCK
OPTION AWARD AGREEMENT


DIRECTORS
AND OFFICERS


Unless
otherwise defined herein, the terms defined in the 2006 Equity Incentive Plan
(the “Plan”) will have the same defined
meanings in this Stock Option Award Agreement (the “Award
Agreement”).


I.                                         NOTICE
OF STOCK OPTION GRANT


Name:


Address:


You
have been granted an option to purchase Common Stock of the Company, subject to
the terms and conditions of the Plan and this Award Agreement, as follows:


	
  Grant Number

  	
   

  	
                                                                

  
	
   

  	
   

  	
   

  
	
  Date of Grant

  	
   

  	
                                                                

  
	
   

  	
   

  	
   

  
	
  Vesting Commencement Date

  	
   

  	
                                                                

  
	
   

  	
   

  	
   

  
	
  Exercise Price per Share

  	
   

  	
  $

  	
                                                            

  
	
   

  	
   

  	
   

  
	
  Total Number of Shares Granted

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Total Exercise Price

  	
   

  	
  $

  	
                                                            

  
	
   

  	
   

  	
   

  
	
  Type of Option:

  	
   

  	
        Incentive Stock
  Option

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
       Nonstatutory Stock
  Option

  
	
   

  	
   

  	
   

  
	
  Term/Expiration Date:

  	
   

  	
   

  



 


Vesting Schedule:


Subject to any acceleration vesting
provisions contained in the Plan or set forth below, this Option may be exercised,
in whole or in part, in accordance with the following schedule:


[Insert
Vesting Schedule Here]









 



 


Termination Period:


This
Option shall be exercisable for three (3) months after Participant ceases to be
a Service Provider, unless such termination is due to Participant’s death or
Disability or such termination occurs within twelve (12) months after a Change
in Control, in which case this Option shall be exercisable for twelve (12) months after Participant ceases to be Service
Provider. Notwithstanding the foregoing, in no event may this Option be
exercised after the Term/Expiration Date as provided above and may be subject
to earlier termination as provided in Section 14(c) of the Plan.


II.            AGREEMENT


A.            Grant of Option.


1.             The Administrator hereby grants to
the individual named in the Notice of Grant attached as Part I of this
Agreement (the “Participant”) an option (the “Option”) to purchase the number of Shares, as set forth in
the Notice of Grant, at the exercise price per share set forth in the Notice of
Grant (the “Exercise Price”), subject to the
terms and conditions of the Plan, which is incorporated herein by reference. Subject
to Section 19(c) of the Plan, in the event of a conflict between the terms and
conditions of the Plan and the terms and conditions of this Award Agreement,
the terms and conditions of the Plan will prevail.


2.             If designated in the Notice of
Grant as an Incentive Stock Option (“ISO”), this
Option is intended to qualify as an Incentive Stock Option under Section 422 of
the Code. However, if this Option is intended to be an Incentive Stock Option,
to the extent that it exceeds the $100,000 rule of Code Section 422(d) it will
be treated as a Nonstatutory Stock Option (“NSO”).


B.            Exercise of Option.


1.             Right to Exercise.  This Option is exercisable during its term in
accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Award Agreement.


2.             Method of Exercise.  This Option is exercisable by delivery of an
exercise notice, in the form attached as Exhibit A (the “Exercise Notice”) or in such other form and
manner as determined by the Administrator, which will state the election to
exercise the Option, the number of Shares in respect of which the Option is
being exercised (the “Exercised Shares”),
and such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice will be completed
by Participant and delivered to the Company. The Exercise Notice will be
accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares, together with any applicable withholding taxes. This Option will be
deemed to be exercised upon receipt by the Company of such fully executed
Exercise Notice accompanied by such aggregate Exercise Price and any applicable
tax withholding.


No Shares will be
issued pursuant to the exercise of this Option unless such issuance and
exercise comply with Applicable Laws. Assuming such compliance, for income tax
purposes the Exercised Shares will be considered transferred to Participant on
the date the Option is exercised with respect to such Exercised Shares.



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C.            Method of Payment.


Payment of the
aggregate Exercise Price will be by any of the following, or a combination
thereof, at the election of Participant:


1.             cash;


2.             check;


3.             consideration received by the Company under a
formal cashless exercise program adopted by the Company in connection with the
Plan; or


4.             surrender of other Shares which, (a) in the
case of Shares acquired from the Company, either directly or indirectly, have
been owned by Participant and not subject to a substantial risk of forfeiture
for more than six (6) months on the date of surrender, and (b) have a
Fair Market Value on the date of surrender equal to the aggregate Exercise
Price of the Exercised Shares.


D.            Non-Transferability of Option.
Unless determined otherwise by the Administrator, this Option may not be
transferred in any manner otherwise than by will or by the laws of descent or
distribution and may be exercised during the lifetime of Participant only by
Participant.


E.             Term of Option. This Option
may be exercised only within the term set out in the Notice of Grant, and may
be exercised during such term only in accordance with the Plan and the terms of
this Award Agreement.


F.             Tax Obligations.


1.             Withholding Taxes. Participant
agrees to make appropriate arrangements with the Company (or the Parent or
Subsidiary employing or retaining Participant) for the satisfaction of all
Federal, state, and local income and employment tax withholding requirements
applicable to the Option exercise. Participant acknowledges and agrees that the
Company may refuse to honor the exercise and refuse to deliver Shares if such
withholding amounts are not delivered at the time of exercise.


2.             Notice of Disqualifying
Disposition of ISO Shares. If the Option granted to Participant herein is
an ISO, and if Participant sells or otherwise disposes of any of the Shares
acquired pursuant to the ISO on or before the later of (a) the date two years
after the Grant Date, or (b) the date one year after the date of exercise, Participant
will immediately notify the Company in writing of such disposition. Participant
agrees that Participant may be subject to income tax withholding by the Company
on the compensation income recognized by Participant.


G.            Entire
Agreement; Governing Law. The Plan is incorporated herein by reference. The
Plan and this Award Agreement constitute the entire agreement of the parties
with respect to the subject matter hereof and supersede in their entirety all
prior undertakings and agreements of the Company and Participant with respect
to the subject matter hereof, and may not be modified adversely to Participant’s
interest except by means of a writing signed by the Company and Participant. This
Award Agreement is governed by the internal substantive laws, but not the
choice of law rules, of California.



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H.            No Guarantee of Continued Service.
PARTICIPANT ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE
VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT
THE WILL OF THE COMPANY (OR THE PARENT OR SUBSIDIARY EMPLOYING OR RETAINING
PARTICIPANT) AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION
OR ACQUIRING SHARES HEREUNDER. PARTICIPANT FURTHER ACKNOWLEDGES AND AGREES THAT
THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING
SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF
CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY
PERIOD, OR AT ALL, AND WILL NOT INTERFERE IN ANY WAY WITH PARTICIPANT’S RIGHT
OR THE RIGHT OF THE COMPANY (OR THE PARENT OR SUBSIDIARY EMPLOYING OR RETAINING
PARTICIPANT) TO TERMINATE PARTICIPANT’S RELATIONSHIP AS A SERVICE PROVIDER AT
ANY TIME, WITH OR WITHOUT CAUSE.


[Remainder of Page Intentionally Left Blank]



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By Participant’s
signature and the signature of the Company’s representative below, Participant
and the Company agree that this Option is granted under and governed by the
terms and conditions of the Plan and this Award Agreement. Participant has
reviewed the Plan and this Award Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Award
Agreement and fully understands all provisions of the Plan and Award Agreement.
Participant hereby agrees to accept as binding, conclusive and final all
decisions or interpretations of the Administrator upon any questions relating
to the Plan and Award Agreement. Participant further agrees to notify the
Company upon any change in the residence address indicated below.


	
  PARTICIPANT:

  	
   

  	
  UTSTARCOM, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature

  	
   

  	
  By

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Print Name

  	
   

  	
  Title

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Residence Address

  	
   

  	
   

  
	
   

  	
   

  	
   

  



 



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EXHIBIT
A


UTSTARCOM,
INC.


2006
EQUITY INCENTIVE PLAN


EXERCISE
NOTICE


UTStarcom, Inc.

1275 Harbor Bay Parkway

Suite 100

Alameda, CA 94502


Attention:  [           ]


1.             Exercise of Option.  Effective as of
today,                     ,
          , the undersigned (“Participant”) hereby elects to purchase                    
shares (the “Shares”) of the Common Stock of
UTStarcom, Inc. (the “Company”) under
and pursuant to the 2006 Equity Incentive Plan (the “Plan”)
and the Award Agreement dated                
(the “Award Agreement”). The purchase price
for the Shares will be $                       ,
as required by the Award Agreement.


2.             Delivery of Payment.  Participant
herewith delivers to the Company the full purchase price for the Shares and any
required withholding taxes to be paid in connection with the exercise of the
Option.


3.             Representations of Participant.  Participant
acknowledges that Participant has received, read and understood the Plan and
the Award Agreement and agrees to abide by and be bound by their terms and
conditions.


4.             Rights as Stockholder.  Until the
issuance (as evidenced by the appropriate entry on the books of the Company or
of a duly authorized transfer agent of the Company) of the Shares, no right to
vote or receive dividends or any other rights as a stockholder will exist with
respect to the Optioned Stock, notwithstanding the exercise of the Option. The
Shares so acquired will be issued to Participant as soon as practicable after
exercise of the Option. No adjustment will be made for a dividend or other
right for which the record date is prior to the date of issuance, except as
provided in Section 14 of the Plan.


5.             Tax Consultation.  Participant
understands that Participant may suffer adverse tax consequences as a result of
Participant’s purchase or disposition of the Shares. Participant represents
that Participant has consulted with any tax consultants Participant deems
advisable in connection with the purchase or disposition of the Shares and that
Participant is not relying on the Company for any tax advice.


6.             Entire Agreement; Governing Law.  The
Plan and Award Agreement are incorporated herein by reference. This Exercise
Notice, the Plan, and the Award Agreement constitute the entire









 



 


agreement of the parties with respect to the subject
matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Participant with respect to the subject matter
hereof, and may not be modified adversely to Participant’s interest except by
means of a writing signed by the Company and Participant. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.


	
  Submitted by:

  	
   

  	
  Accepted by:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  PARTICIPANT:

  	
   

  	
  UTSTARCOM, INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Signature

  	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Print Name

  	
   

  	
  Its

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1275 Harbor Bay
  Parkway

  	
   

  
	
   

  	
   

  	
  Suite 100

  	
   

  
	
   

  	
   

  	
  Alameda, CA
  94502

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date Received

  	
   

  



 



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