Exhibit
10.1


 





 


April 26,
2010


 


Edmond Cheng


 


(Delivery by email)


 


Dear Edmond:


 


I am pleased to
confirm the offer of employment by UTStarcom, Inc. (“UTStarcom” or the “Company”)
to you for the position of Senior Vice President and Chief Financial Officer
with a start date on or about May 10th,
2010.  This position reports directly to
Peter Blackmore, President and Chief Executive Officer.


 


The key elements
of this employment offer are as follows:


 


Salary: Your gross annual salary is $380,000 USD.  Paydays
are on the 15th and the last day of each month. 
Direct deposit is available.  Your
salary payments will be subject to any applicable tax or other legally-required
withholding.


 


Annual
Performance Bonus:
On an annual basis, you will be eligible for a performance target bonus of 70%
of your base salary (the “Annual Bonus”) based upon achievement of Company and
individual performance objectives determined by the Compensation
Committee.  For the 2010 Fiscal Year 100%
of your annual target bonus will be guaranteed to you and will be payable at
the time bonuses for the 2010 fiscal year are paid to other executives (but no
later than March 15, 2011).


 


Equity
Award: We will
recommend to the Compensation Committee (the “Compensation Committee”) of our
Board of Directors, at its next meeting after your start date at which grants
are considered for approval, that you be granted equity awards pursuant to the
Plan and subject to the form of applicable award agreements adopted by
UTStarcom for use under the Plan as follows:


 


·                  200,000 shares of Restricted Stock.  One quarter of the shares would vest on the
first anniversary of the date of grant, and then one-quarter of the shares
would vest annually thereafter, subject to your continuing to provide services
to the Company through each applicable vesting date.


 


·                  100,000 Restricted Stock Units (RSU’s).  One quarter of the RSU’s would vest on the
first anniversary of the date of grant, and then one-quarter of the RSU’s would
vest annually thereafter, subject to your continuing to provide services to the
Company through each applicable vesting date.


 

















 


We will recommend
to the Compensation Committee in January 2011 that you be granted
additional equity awards, in addition to any normal annual executive options
awards, covering 100,000 shares of UTStarcom common stock in January 2011,
subject to you continuing to provide services to the Company through that
time.  The additional equity awards would
be granted pursuant to the Plan and subject to the form of applicable award agreements
adopted by UTStarcom for use under the Plan as follows:


 


·                  100,000 shares of Restricted Stock.  One quarter of the shares would vest on the
first anniversary of the date of grant, and then one-quarter of the shares
would vest annually thereafter, subject to your continuing to provide services
to the Company through each applicable vesting date.


 


We will recommend
to the Compensation Committee in January 2012 that you be granted
additional equity awards, in addition to any normal annual executive options
awards, covering 100,000 shares of UTStarcom common stock in January 2012,
subject to you continuing to provide services to the Company through that
time.  The additional equity awards would
be granted pursuant to the Plan and subject to the form of applicable award
agreements adopted by UTStarcom for use under the Plan as follows:


 


·                  100,000 shares of Restricted Stock.  One quarter of the shares would vest on the
first anniversary of the date of grant, and then one-quarter of the shares
would vest annually thereafter, subject to your continuing to provide services
to the Company through each applicable vesting date.


 


The decision to
make any equity grant, as well as the terms of any such award, will be in the
full discretion of the Compensation Committee.


 


Sign-on
Bonus: You will
be paid a Sign-on Bonus of $50,000 USD
payable after your start date on the first payroll as soon as administratively
possible.  If you resign from UTStarcom
within six (6) months from your employment with UTStarcom, the Sign-on
Bonus must be repaid to UTStarcom in full.


 


Education
Assistance: You
will be provided with full reimbursement for the cost up to $125,000 USD to pursue your Executive MBA program during
your employment with the Company.  The
reimbursement is subjected to submission of valid documentation and receipts of
payment.


 


Expatriate
Benefits: You
will be eligible to receive expatriate benefits as follows:


 


·                  Housing Allowance — $4,000 USD
monthly


 


·                  Relocation reimbursement of up to $15,000 USD
to cover the actual expenses of reasonable, documented travel, and moving to
and storing your personal effects in the assignment country within 12 months
from your start date.  You have the
option of submitting receipts for reimbursement or receiving a lump sum.  If you resign from your employment with the
Company within one (1) year following your start date, you agree that you
will immediately repay the Company the full amount of the relocation
reimbursement that you receive, less 1/12 of that amount for each full month
that you are actually employed by the Company and this will not be pro-rated if
you worked less than a full month.


 


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·                  Home visit travel benefit of one round-trip
business-class airfare per year for your immediate family of five to home
country.


 


·                  Dependent Education - You are entitled to an annual
reimbursement of up to $15,000 USD  per child (maximum 2 children / $30,000 USD up to 18 years
of age) to pay for the cost of education for your children who will be
permanently residing overseas with you.


 


·                  Repatriation: Upon the repatriation of your assignment
for any reason the Company will reimburse you for the actual, reasonable,
documented moving and travel costs incurred by you to return to your home
country.  The maximum amount of such
reimbursement up to $15,000 USD
(which amount will be subject to setoff for any amounts owed by you to the
Company) and original receipts are required; no lump sum payment option is
available.  To qualify for the
reimbursement, relocation expense must incur within 90 days following effective
date of your repatriation.


 


·                  Medical and Dental Plan coverage will be provided
under Aetna Global Benefits for you, your spouse and your three children.


 


·                  Taxation equalization: The Company will provide you
with tax equalization so that you incur no additional tax liability or benefit
as a result of your assignment outside the USA (home country).  (In other words, your tax liability will be
the same as if you had remained in your home country.) The Company will provide
tax preparation and equalization services through Deloitte & Touche,
which will also assist you in complying with all applicable tax laws of your
home country and host country.


 


·                  Car/Driver: you will be provided access to a company
car and driver for business purposes.


 


·                  HZ Meal Allowance: You will also be eligible for a
meal allowance of $8 USD/day.


 


Interest or
penalties imposed by tax authorities as a result of improper reporting or
delays in providing necessary documents by you to Deloitte & Touche
will be your responsibility.


 


Executive
Involuntary Termination Severance Pay Plan: You will be covered by the Amended and Restated
Executive Involuntary Termination Severance Pay Plan on the commencement of
your employment, in which the terms and conditions, in part provide as follows:


 


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In the event of involuntary termination of your employment for reasons
other than cause, death or disability, you will be provided with payment of one
year’s base salary plus 100% of your on target bonus for the year in which the
termination occurs, an amount equal to twelve (12) months of the premiums for
continuation coverage for your health benefits and 100% full vesting of equity
as granted to you, including without limitation to stock options, restricted
stock, restricted stock units, stock appreciation rights, performance units,
performance shares and other stock awards.


 


Financial
Planning benefit:
UTStarcom will cover up to $5,000 per year
of costs incurred by you in obtaining comprehensive financial planning and
investment management services to assist you in understanding your financial
picture and estate planning and insurance needs.  Covered services include retirement planning,
education funding, portfolio risk management, concentrated stock and employee
stock option management, 10b5-1 design, income and asset protection, estate
planning and philanthropic gifting. 
While we have made special arrangements for these services to be
provided by Merrill Lynch, you can use any provider of your choice.  This is considered a taxable benefit


 


At Will
Employment: Your
employment with UTStarcom is “at will”; it is for no specified term, and may be
terminated by you or UTStarcom at any time, with or without cause or advance
notice.


 


Dispute
Resolution: In
the event of any dispute or claim relating to or arising out of your employment
relationship with the Company, this agreement, or the termination of your
employment with the Company for any reason (including, but not limited to, any
claims of breach of contract, wrongful termination or age, sex, race, national
origin, disability or other discrimination or harassment), you and the Company
agree that all such disputes shall be fully, finally and exclusively resolved
by binding arbitration conducted by the American Arbitration Association (“AAA”)
in Alameda County, California.  Any
arbitration under this provision will be determined by a single arbitrator
under the AAA’s then-current National Rules For the Resolution of
Employment Disputes, a copy of which is available at www.adr.org.  You and the Company hereby waive your
respective rights to have any such disputes or claims tried to a judge or jury.


 


Governing
Law: This
agreement shall be governed by, and interpreted in accordance with, the laws of
the State of California.


 


Other
Conditions: As a
condition of your employment, you must provide the Company with satisfactory
proof of your identity and your 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).  As a
further condition of your employment, you will be required to sign a copy of
the Company’s standard form of employment, confidential information and
invention assignment agreement, and to strictly comply with all Company rules and
regulations at all times.


 


If you have any
questions about UTStarcom’s employee benefits programs, please feel free to
contact Melody Fan at melody.fan@utstar.com or 510-749-1520.


 


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To accept the
Company’s offer of employment, please sign and date this letter in the space
provided below and return it to me at the confidential fax of
510-747-0129.  This letter
agreement, along with the confidentiality agreement described above, sets forth
the terms of your employment with the Company and supersedes any prior
representations or agreements, whether written or oral.  This agreement may not be modified or amended
except by a subsequent written agreement, signed by an authorized officer of
the Company and by you.


 


Sincerely,


 


 


Peter Blackmore


Chief Executive
Officer and President


 


 


	
  /s/ PETER
  BLACKMORE

  	
   

  



 


 


I agree to and
accept employment with UTStarcom on the terms and conditions set forth in this
letter agreement.  Also, I acknowledge
and agree that I am not an employee subject to the laws of the People’s
Republic of China.


 


 


	
  Signed:

  	
  /s/ EDMOND CHENG

  	
   

  
	
   

  	
  Employee
  Signature

  	
   

  



 


Print
Name: Edmond Cheng


 


Date: April 26,
2010


 


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