Exhibit 10.2


UTSTARCOM, INC.


RETENTION AGREEMENT


This Retention Agreement (the “Agreement”) is
made November 30, 2007 (the “Effective Date”),
by and between Francis P. Barton (“Executive”)
and UTStarcom, Inc. (the “Company”).


WHEREAS, Executive is employed as the Company’s Executive
Vice President and Chief Financial Officer and serves on the Company’s Board of
Directors (the “Board”);


WHEREAS, Executive is a valued member of the Company’s senior
management team and has played a critical role in completing the Company’s
stock option investigation and assisting the Company to becoming current in its
filing requirements with the Securities and Exchange Commission; and


WHEREAS, the Company wishes to provide an incentive to
Executive to (i) remain in the employ of the Company and (ii) increase the
value of the Company for the benefit of its stockholders.


NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and in consideration of Executive’s continued employment with the
Company, the parties agree as follows:


1.             That
the Company will provide Executive a retention incentive with a total value of
$10,000,000 (the “Retention Incentive”),
as determined herein.


2.             That
the Retention Incentive will consist of a combination of restricted stock, restricted
stock units, performance shares and performance units (together, “Equity”) granted under the Company’s 2006 Equity Incentive
Plan (the “Plan”) and/or cash, in the sole
discretion of the Compensation Committee of the Board (the “Committee”).


3.             That
the value of the Equity granted to Executive as part of the Retention Incentive
will be determined based on the Fair Market Value (as defined in the Plan) of
the Company’s common stock on the applicable date of grant.  By way of example only, if the Company were
to grant Executive an award of 300,000 shares of restricted stock when the Fair
Market Value of the Company’s common stock was $5.00 per share, that award
would be valued at $1,500,000 for purposes of determining the value awarded to
Executive under Section 1.


4.             That
it is the desire of the parties hereto that the Retention Incentive consist of
Equity, though the Company retains the right (but not the obligation) to
provide the Retention Incentive solely or partially in cash.  Because of the limits on the maximum amount
of Equity that can be granted to an individual in any calendar year, it is the
expectation of the parties that the Retention Incentive will be awarded over a
number of years, so that as much of the Retention Incentive can be awarded under
the Plan as possible.


5.             That
the Committee will award the first installment of the Retention Incentive to
Executive in a combination of Equity in the Committee’s sole discretion, up to
the annual maximum

















 


amounts permitted under the Plan after taking into
account Executive’s 2007 focal awards, subject to Executive’s continued
employment with the Company through the date such awards are granted.


6.             That
each January following the Effective Date, the remaining installments of the
Retention Incentive will be awarded to Executive in a combination of Equity
and/or cash, as determined by the Committee in its sole discretion, with the
expectation that the Retention Incentive will be granted in a combination of
Equity up to the maximum annual limits permitted under the Plan after taking
into account Executive’s focal grant for the particular year, subject to
Executive’s continued employment with the Company through each such date.


7.             That
the first installment of the Retention Incentive will vest as to $2,500,000 in
value on the date the Equity award to be granted pursuant to Section 5 becomes
effective consistent with the Company’s Equity Award and Grant Policy and
Procedures, and as to $2,500,000 in value on each November 30 thereafter,
subject to Executive’s continued employment with the Company through each
vesting date.  The Committee will
determine in its sole discretion the types of Equity and the amount of Equity
and, if applicable, cash that will be eligible to vest on each vesting
date.  For these purposes, the value of
Equity to vest will be based on the Fair Market Value (as defined in the Plan)
of the Company’s common stock on the applicable date of grant.


8.             That
in the event Executive’s employment is terminated in a manner that would
trigger the payment of severance benefits under the Change of
Control/Involuntary Termination Severance Agreement by and between Executive
and the Company (the “Severance Agreement”)
or Executive’s employment with the Company is terminated as a result of his
death or Disability, then Executive shall be entitled to a cash payment equal
to the amount of the Retention Incentive that has not been granted in Equity as
of the date of such termination.  The
receipt of any such payment that arises as a result of a termination of
Executive’s employment with the Company that would trigger severance payments
under the Severance Agreement will be subject to the same terms and conditions
that apply to Executive’s receipt of severance benefits under the Severance
Agreement.  For the purposes of this
Agreement, “Disability” will have the same
meaning given to the term in the Plan.


By way of example only, if the Company terminated Executive’s
employment with the Company without Cause (as defined in the Severance
Agreement) and as of the date of such termination had granted Executive Equity
with a value of $9,000,000 as determined under Section 3, then the Company
would make a lump sum cash payment to Executive equal to $1,000,000, subject to
the same terms and conditions that apply to Executive’s receipt of severance
benefits under the Severance Agreement.


For avoidance of doubt, the vesting of any Equity granted pursuant to
the Retention Incentive may also accelerate pursuant to the provisions of the
Severance Agreement.  In addition, if Executive’s
employment with the Company is terminated as a result of his death or
Disability, the vesting of any Equity granted pursuant to the Retention
Incentive will become fully vested or released from the Company’s repurchase
right as of the date of termination.


9.             That notwithstanding anything to the
contrary in this Agreement, if Executive is a “specified employee” within the
meaning of Section 409A of the Code and any final regulations and


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guidance
promulgated thereunder (“Section 409A”)
at the time of Executive’s termination, then only that portion of the severance
payable to Executive pursuant to this Agreement (other than due to death), if
any, and any other severance payments or separation benefits which may be
considered deferred compensation under Section 409A (together, the “Deferred Compensation Separation Benefits”),
which (when considered together) do not exceed the Section 409A Limit (as
defined below) may be made within the first six (6) months following Executive’s
termination of employment in accordance with the payment schedule applicable to
each payment or benefit.  Any portion of the Deferred
Compensation Separation Benefits in excess of the Section 409A Limit otherwise
due to Executive on or within the six (6) month period following Executive’s
termination will accrue during such six (6) month period and will become
payable in a lump sum payment on the date six (6) months and one (1) day
following the date of Executive’s termination of employment.  All subsequent Deferred Compensation
Separation Benefits, if any, will be payable in accordance with the payment
schedule applicable to each payment or benefit.


For these purposes “Section 409A
Limit” will mean the lesser of two (2) times: (i) Executive’s
annualized compensation based upon the annual rate of pay paid to Executive
during the Company’s taxable year preceding the Company’s taxable year of
Executive’s termination of employment as determined under Treasury Regulation
1.409A-1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with
respect thereto; or (ii) the maximum amount that may be taken into account
under a qualified plan pursuant to Section 401(a)(17) of the Code for the
year in which Executive’s employment is terminated.


The foregoing provisions are intended to comply with the requirements
of Section 409A so that none of the severance payments and benefits to be
provided hereunder will be subject to the additional tax imposed under Section
409A, and any ambiguities herein will be interpreted to so comply.  The Company and Executive agree to work
together in good faith to consider amendments to this Agreement and to take
such reasonable actions which are necessary, appropriate or desirable to avoid
imposition of any additional tax or income recognition prior to actual payment
to Executive under Section 409A.


10.           That
all payments made pursuant to this Agreement will be subject to withholding of
applicable taxes.


11.           That
this Agreement, together with the Plan, the equity award agreements evidencing
the Equity awards that will be granted pursuant to this Agreement and the
Severance Agreement, represent the entire agreement and understanding between
the parties as to the subject matter hereof and supersede all prior or
contemporaneous agreements, whether written or oral.  No waiver, alteration or modification of any
of the provisions of this Agreement will be binding, unless in writing and
signed by duly authorized representatives of the parties hereto.


12.           That
this Agreement will be governed by the laws of the State of California (with
the exception of its conflict of laws provisions).


13.           That
this Agreement may be executed in counterparts, and each counterpart will have
the same force and effect as an original and will constitute an effective,
binding agreement on the part of each of the undersigned.  Execution and delivery of this Agreement by
exchange of facsimile


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copies
bearing the facsimile signature of a party will constitute a valid and binding
execution and delivery of the Agreement by such party.  Such facsimile copies will constitute
enforceable original documents.


IN WITNESS WHEREOF, this Agreement has been entered into as
of the date first set forth above.


	
  UTSTARCOM,
  INC.

  	
   

  	
  EXECUTIVE

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Susan Marsch

  	
   

  	
  /s/ Francis P. Barton

  
	
   

  	
   

  	
  Francis P. Barton

  
	
  Name:

  	
  Susan
  Marsch

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Its:

  	
  VP and General Counsel

  	
   

  	
  Address:

  	
  c/o Company

  
						



 


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