Document:

Exhibit
4.7

 

 

 

UTSTARCOM, INC.

(a Delaware corporation)

           Shares of Common
Stock

 

UNDERWRITING

AGREEMENT

 

 

Dated: 
                   

 

 

 

 

TABLE OF
CONTENTS

 

	
  Section 1.  Representations and
  Warranties

  	
   

  
	
  Section 2.  Sale and Delivery to
  Underwriters; Closing

  	
   

  
	
  Section 3.  Covenants of the Company

  	
   

  
	
  Section 4.  Payment and Expenses

  	
   

  
	
  Section 5.  Conditions of
  Underwriters’ Obligations

  	
   

  
	
  Section 6.  Indemnification

  	
   

  
	
  Section 7.  Contribution

  	
   

  
	
  Section 8.  Representations,
  Warranties and Agreements to Survive Delivery

  	
   

  
	
  Section 9.  Termination of Agreement

  	
   

  
	
  Section 10.  Default by One or More
  of the Underwriters

  	
   

  
	
  Section 11.  Default by the Company

  	
   

  
	
  Section 12.  Notices

  	
   

  
	
  Section 13.  Parties

  	
   

  
	
  Section 14.  Governing Law and Time

  	
   

  
	
  Section 15.
  The Headings

  	
   

  
	
  Section 16.   Counterparts

  	
   

  
	
   

  	
   

  
	
  SCHEDULES

  	
   

  
	
   

  	
   

  
	
  Schedule A

  	
  Underwriters

  	
   

  
	
  Schedule B

  	
  Company

  	
   

  
	
  Schedule C

  	
  List of Significant Subsidiaries

  	
   

  
	
  Schedule D

  	
  Pricing Information

  	
   

  
	
  Schedule E

  	
  List of Directors and Executive Officers

  	
   

  
	
   

  	
   

  
	
  EXHIBITS

  	
   

  
	
   

  	
   

  
	
  Exhibit A

  	
  Form of Opinion of Counsel for the Company

  	
   

  
	
  Exhibit B

  	
  Form of Lockup Agreement for Directors and Executive Officers

  	
   

  
	
  Exhibit C

  	
  Form of Lockup Agreement for SOFTBANK America, Inc

  	
   

  

 

i

 

UTSTARCOM, INC.

(a Delaware corporation)

12,100,000 Shares of Common
Stock

(Par Value $.00125 Per Share)

 

UNDERWRITING AGREEMENT

 

	
  BANC OF AMERICA SECURITIES LLC

  	
  January 8,
  2004

  

600 Montgomery Street

San Francisco, California  94111

     As Representative of the several Underwriters

 

Ladies and Gentlemen:

 

UTStarcom,
Inc., a Delaware corporation (the “Company”),
confirms its agreement with Banc of America Securities LLC and each of the
other Underwriters named in Schedule A hereto (collectively, the “Underwriters,” which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof), for whom Banc
of America Securities LLC is acting as representative (in such capacity, the “Representative”), with respect to the (i) issuance and sale
by the Company and the purchase by the Underwriters, acting severally and not
jointly, of the 12,100,000 shares of Common Stock, par value $.00125 per share,
of the Company (“Common Stock”) and (ii) the grant
by the Company to the Underwriters of the option described in Section 2(b)
hereof to purchase, acting severally and not jointly, all or any part of 1,815,000
additional shares of Common Stock to cover over-allotments, if any.  The aforesaid 12,100,000 shares of Common
Stock (the “Initial Securities”) to be
purchased by the Underwriters and all or any part of the 1,815,000 shares of
Common Stock subject to the option described in Section 2(b) hereof (the “Option Securities”) are hereinafter called, collectively,
the “Securities.”

 

The Company
understands that the Underwriters propose to make a public offering of the
Securities as soon as the Representative deems advisable after this Agreement
has been executed and delivered.

 

The Company
has filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form S-3 (No.
333-107723) covering the registration of the Securities under the Securities
Act of 1933, as amended (the “1933 Act”),
including a prospectus relating to the Common Stock (the “Basic
Prospectus”).  Promptly after
execution and delivery of this Agreement, the Company will prepare and file a
prospectus supplement in accordance with the provisions of paragraph (b)
of Rule 424 of the rules and regulations of the Commission under the 1933
Act (the “1933 Act Regulations”).   Such registration statement, including the
exhibits thereto, schedules thereto, if any, and the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, as
amended as of the date of this Agreement, and, in the event any post-effective
amendment thereto becomes effective prior to the Closing Time (as defined in
Section 2(c) hereof), is herein called the “Registration
Statement.”  Any registration
statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein
referred to as the “Rule 462(b) Registration
Statement,” and after such filing the term “Registration
Statement” shall include the Rule 462(b) Registration Statement.

 

 

As used herein, the term “Final Prospectus”
means the final prospectus supplement to the Basic Prospectus relating to the
Securities in the form first used to confirm sales of the Securities, together
with the Basic Prospectus and including the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act .  For purposes of this Agreement, all
references to the Registration Statement, the Basic Prospectus, the Final Prospectus
or any amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system (“EDGAR”).

 

All references
in this Agreement to financial statements and schedules and other information
which is “contained,” “included,” “stated,” “disclosed,” “set forth,” or
“described” in the Registration Statement or the Final Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement as of the effective date of the
Registration  Statement or the date of
the Basic Prospectus or the Final Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the Registration
Statement, the Basic Prospectus or the Final Prospectus shall be deemed to mean
and include the filing of any document under the Securities Exchange Act of
1934 (the “1934 Act”) which is incorporated
by reference in the Registration Statement, the Basic Prospectus or the Final
Prospectus, as the case may be.

 

Section 1.  Representations and
Warranties.  The Company
represents and warrants to each Underwriter as of the date hereof, as of the
Closing Time referred to in Section 2(c) hereof, and as of each Date of
Delivery (if any) referred to in Section 2(b) hereof, and agrees with each
Underwriter, as follows:

 

(i)                                     Compliance with Registration Requirements.  The Company meets the requirements for use of
Form S-3 under the 1933 Act.  Each of the
Registration Statement and any Rule 462(b) Registration Statement has become
effective under the 1933 Act and no stop order suspending the effectiveness of
the Registration Statement or any Rule 462(b) Registration Statement has been
issued under the 1933 Act and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the Company, are contemplated
by the Commission, and any request on the part of the Commission for additional
information has been complied with.

 

At the
respective times the Registration Statement, any Rule 462(b) Registration
Statement and any post-effective amendments thereto became effective and at the
Closing Time (and, if any Option Securities are purchased, at the Date of
Delivery), the Registration Statement, the Rule 462(b) Registration Statement
and any amendments and supplements thereto complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and did not and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading.  Neither the Final Prospectus nor any
amendments or supplements thereto, at the time the Final Prospectus or any
amendments or supplements were issued and at the Closing Time (and, if any
Option Securities are purchased, at the Date of Delivery), included or will
include an untrue statement of a material fact or omitted or will omit to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under

 

2

 

which they were made, not misleading.  The representations and warranties in this
subsection shall not apply to statements in or omissions from the
Registration Statement or the Final Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by any
Underwriter through the Representative expressly for use in the Registration
Statement or the Final Prospectus.

 

The prospectus
filed as part of the Registration Statement as originally filed or as part of
any amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations and the Final Prospectus delivered to the
Underwriters for use in connection with this offering was identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.

 

(ii)                                  Incorporated Documents. 
The documents incorporated or deemed to be incorporated by reference in
the Registration Statement and the Final Prospectus, at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission thereunder (the “1934 Act
Regulations”), and, when read together with the other information in
the Final Prospectus, at the time the Registration Statement became effective,
at the time the Final Prospectus was issued and at the Closing Time (and, if
any Option Securities are purchased, at the Date of Delivery), did not and will
not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading.

 

(iii)                               Independent Accountants. 
The accountants who certified the financial statements and supporting
schedules included in the Registration Statement are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations; each of
the Company and its subsidiaries maintains a system of internal accounting
controls sufficient to provide reasonable assurance that (A) transactions are
executed in accordance with management’s general or specific authorizations;
(B) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles (“GAAP”) in China with a reconciliation to GAAP in the United
States; (C) access to assets is permitted only in accordance with management’s
general or specific authorization; (D) the recorded accountability for assets
is compared with existing assets at reasonable intervals and appropriate
actions taken with respect to any differences; and (E) each of the Company and
its subsidiaries has made and kept books, records and accounts which, in
reasonable detail, accurately and fairly reflect the transactions and
dispositions of assets of such entity and provide a sufficient basis for the
preparation of combined financial statements in accordance with Chinese GAAP,
with a reconciliation thereof to U.S. GAAP.

 

(iv)                              Financial Statements. 
The financial statements included in the Registration Statement and the
Final Prospectus, together with the related schedules and notes present fairly
the financial position of the Company and its consolidated subsidiaries at the
dates indicated and the statement of operations, stockholders’ equity and cash
flows of the Company and its consolidated subsidiaries for the periods
specified; said financial statements have been prepared in conformity with U.S.
GAAP

 

3

 

applied on a
consistent basis throughout the periods involved, except as may be expressly
stated in the related notes thereto.  The
supporting schedules, if any, included in the Registration Statement present
fairly in accordance with U.S. GAAP the information required to be stated
therein.  The selected financial data,
the summary financial information and all other financial data or information
included in the Final Prospectus present fairly the information shown therein
and have been compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement.  The consolidated statements of net assets of
CommWorks, an operating segment of 3Com Corporation (“CommWorks”), as of February 28, 2003
and May 31, 2002 and the related consolidated statements of revenues and
direct expenses for the nine months ended February 28, 2003 and the years
ended May 31, 2002 and June 1, 2001, present fairly the net assets of
CommWorks at the dates indicated and the related revenues and direct expenses
of CommonWorks for the periods specified, in conformity with U.S. GAAP.  The pro forma financial statements and the
related notes thereto included in the Registration Statement and the Final
Prospectus present fairly the information shown therein, have been prepared in
accordance with the Commission’s rules and guidelines with respect to pro forma
financial statements and have been properly compiled on the bases described
therein, and the assumptions used in the preparation thereof are reasonable and
the adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein.

 

(v)                                 No Material Adverse Change in Business.  Since the respective dates as of which
information is given in the Registration Statement and the Final Prospectus,
except as otherwise stated therein, (A) there has been no material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries, taken as a
whole, whether or not arising in the ordinary course of business (a “Material Adverse Effect”), (B) there have been no
transactions entered into by the Company, or any of its subsidiaries, other
than those in the ordinary course of business, which are material with respect
to the Company and its subsidiaries, considered as one enterprise, and (C)
there has been no dividend or distribution of any kind declared, paid or made
by the Company on any class of its capital stock at any time.

 

(vi)                              Good Standing of the Company.  The Company has been duly organized and is
validly existing as a corporation in good standing under the laws of the State
of Delaware and has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Final Prospectus and
to enter into and perform its obligations under this Agreement; and the Company
is duly qualified as a foreign corporation to transact business and is in good
standing in each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to be in good standing
would not result in a Material Adverse Effect.

 

(vii)                           Good Standing of Subsidiaries.  The entities listed on Schedule C hereto
(each, a “Subsidiary” and collectively, the “Subsidiaries”) are the only significant subsidiaries (as
defined in Rule 1-02 of Regulation S-X) of the Company, and each Subsidiary has
been duly organized and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate power
and

 

4

 

authority to
own, lease and operate its properties and to conduct its business as described
in the Final Prospectus and is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement, all of the issued and
outstanding capital stock of each Subsidiary has been duly authorized and
validly issued, is fully paid and non–assessable and is owned by the Company,
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; with respect to each
Subsidiary, none of the outstanding shares of capital stock of the Subsidiary
was issued in violation of the preemptive rights of any securityholder of the
Subsidiary pursuant to the Subsidiary’s charter documents or applicable law or
any agreement or instrument to which the Subsidiary is a party or by which the
Subsidiary is bound which has not otherwise been waived by such securityholder.

 

(viii)                        Capitalization.  The
authorized, issued and outstanding capital stock of the Company, as of
September 30, 2003, is as set forth in the Final Prospectus under the
caption “Capitalization” (except for subsequent issuances, if any, pursuant to
this Agreement, pursuant to reservations, agreements or employee benefit plans
disclosed or incorporated by reference in the Final Prospectus or pursuant to
the exercise of convertible securities, warrants or options disclosed or
incorporated by reference in the Final Prospectus).  The shares of issued and outstanding capital
stock have been duly authorized and validly issued and are fully paid and
non-assessable; none of the outstanding shares of capital stock was issued in
violation of any preemptive rights of any securityholder of the Company
pursuant to the Company’s Certificate of Incorporation or Bylaws or applicable
law or any agreement or instrument to which the Company is a party or by which
the Company is bound which has not otherwise been waived by such securityholder.

 

(ix)                                Authorization of Agreement and Registration Statement.  This Agreement has been duly authorized,
executed and delivered by the Company. 
The Registration Statement and the Final Prospectus and the filing of
the Registration Statement and the Final Prospectus with the Commission have
been duly authorized by and on behalf of the Company, and the Registration
Statement has been duly signed by and on behalf of the Company pursuant to such
authorization.

 

(x)                                   Authorization and Description of Securities.  Any Option Securities purchased by the
Underwriters from the Company have been duly authorized for issuance and sale
to the Underwriters pursuant to this Agreement and, when issued and delivered
by the Company pursuant to this Agreement against payment of the consideration
set forth herein, will be validly issued, fully paid and non-assessable; the
Common Stock conforms in all material respects to all statements relating
thereto contained in the Final Prospectus and such description conforms in all
material respects to the rights set forth in the instruments defining the same;
no holder of the Securities will be subject to personal liability by reason of
being such a holder; and the issuance of the Securities is not subject to any
preemptive rights of any securityholder of the Company pursuant to the
Company’s Certificate of Incorporation or Bylaws or applicable law or any
agreement or

 

5

 

instrument to
which the Company is a party or by which the Company is bound which has not
otherwise been waived by such securityholder.

 

(xi)                                Absence of Defaults and Conflicts.  Neither the Company nor any of its
subsidiaries is in violation of its articles, charter, by laws or similar
organizational document or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease or
other agreement or instrument to which the Company or any of its subsidiaries
is a party or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any subsidiary is subject (collectively, “Agreements and Instruments”), except for such defaults that
would not result in a Material Adverse Effect; and the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein and in the Registration Statement (including the issuance
and sale of the Securities and the use of the proceeds from the sale of the
Securities as described in the Final Prospectus under the caption “Use of Proceeds”) and compliance by the Company with its
obligations hereunder have been duly authorized by all necessary corporate
action and do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or default or
Repayment Event (as defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any subsidiary pursuant to, the Agreements and Instruments
(except for such conflicts, breaches or defaults or liens, charges or
encumbrances that would not result in a Material Adverse Effect), nor will such
action result in any violation of the provisions of the articles, charter,
by-laws, as applicable, of the Company or any subsidiary or any applicable law,
statute, rule, regulation, judgment, order, writ or decree, known to the
Company of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any subsidiary or any of their
assets, properties or operations.  As
used herein, a “Repayment Event” means any event
or condition which gives the holder of any note, debenture or other evidence of
indebtedness (or any person acting on such holder’s behalf) the right to
require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any subsidiary.

 

(xii)                             Absence of Labor Dispute. 
No labor dispute with the employees of the Company or any subsidiary
exists or, to the knowledge of the Company, is imminent, and the Company is not
aware of any existing or imminent labor disturbance by the employees of any of
its or any subsidiary’s principal suppliers, manufacturers, customers or
contractors, which, in either case, may reasonably be expected to result in a
Material Adverse Effect.

 

(xiii)                          Absence of Proceedings. 
Other than as set forth in the Final Prospectus, there is no action,
suit, proceeding, inquiry or investigation before or brought by any company or
governmental agency or body, domestic or foreign, now pending, or, to the
knowledge of the Company, threatened, against the Company or any subsidiary,
which is required to be disclosed in the Registration Statement (other than as
disclosed therein), or which might reasonably be expected to result in a
Material Adverse Effect, or which might reasonably be expected to materially
and adversely affect the properties or assets thereof or the consummation of
the transactions contemplated in this Agreement or the

 

6

 

performance by
the Company of its obligations hereunder; the aggregate of all pending legal or
governmental proceedings to which the Company or any subsidiary is a party or
of which any of their respective property or assets is the subject which are
not described in the Registration Statement, including ordinary routine
litigation incidental to the business, could not reasonably be expected to
result in a Material Adverse Effect.

 

(xiv)                         Accuracy of Exhibits. 
There are no contracts or documents which are required to be described
in the Registration Statement, the Final Prospectus or the documents
incorporated by reference therein or to be filed as exhibits thereto which have
not been so described and filed as required.

 

(xv)                            Possession of Intellectual Property.  The Company and its subsidiaries own or
possess, or can acquire on reasonable terms, adequate patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems
or procedures), trademarks, service marks, trade names or other intellectual
property (collectively, “Intellectual Property”)
necessary to carry on the business now operated by them, and neither the
Company nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others with
respect to any Intellectual Property or of any existing facts or circumstances
which would render any Intellectual Property invalid or inadequate to protect
the interest of the Company or any of its subsidiaries therein, and which
infringement or, conflict (if the subject of any unfavorable decision, ruling
or finding) or invalidity or inadequacy singly or in the aggregate, would
result in a Material Adverse Effect.

 

(xvi)                         Absence of Further Requirements.  No filing with, or authorization, approval,
consent, license, order, registration, qualification or decree of, any court or
governmental authority or agency is necessary or required for the performance
by the Company of its obligations hereunder in connection with the offering,
issuance or sale of the Securities or the consummation of the transactions
contemplated herein, except such as have been already obtained or as may be
required under the 1933 Act or the 1933 Act Regulations or state securities
laws.

 

(xvii)                      Possession of Licenses and Permits.  Except as otherwise stated in the Final
Prospectus and the Registration Statement, the Company and its subsidiaries
possess such permits, licenses, approvals, consents and other authorizations
(collectively, “Governmental Licenses”) issued by
the appropriate federal, state, local or foreign regulatory agencies or bodies
(including the People’s Republic of China (“PRC”)
State Council, the PRC Ministry of Information Industry, the State Development
Planning Commission, the State Economic Trade Commission, the China Securities
Regulatory Commission (the “CSRC”), the
Ministry of Foreign Commerce (“MOC”), the
Ministry of Land and Resources, the State Administration of Foreign Exchange (“SAFE”), the General Administration of Customs, the relevant
Posts and Telecommunications Administrations (“PTA”)
and the relevant Commodity Pricing Administration Bureau) necessary to conduct
the business now operated by them; the Company and its subsidiaries are in
compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, singly or in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses are valid and
in full

 

7

 

force and
effect, except when the invalidity of such Governmental Licenses or the failure
of such Governmental Licenses to be in full force and effect would not have a
Material Adverse Effect; and neither the Company nor any of its subsidiaries
has received any notice of proceedings relating to the revocation, suspension
or modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
result in a Material Adverse Effect.

 

(xviii)                   Title to Property. 
The Company and its subsidiaries have good and marketable title to all
real property owned by the Company and its subsidiaries and good title to all
other properties owned by them, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or encumbrances of any
kind except such as (a) are described in the Final Prospectus or (b) do not,
singly or in the aggregate, materially affect the value of such property and do
not interfere with the use made and proposed to be made of such property by the
Company or any of its subsidiaries; and all of the leases and subleases
material to the business of the Company and its subsidiaries, considered as one
enterprise, and under which the Company or any of its subsidiaries holds
properties described in the Final Prospectus, are in full force and effect, and
neither the Company nor any subsidiary has any notice of any material claim of
any sort that has been asserted by anyone adverse to the rights of the Company
or any subsidiary under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or such subsidiary to the
continued possession of the leased or subleased premises under any such lease
or sublease.

 

(xix)                           Repatriation of Dividends and Other Distributions.  All dividends and other distributions
declared and payable on the equity or other interests in each of the
Subsidiaries may, under the laws and regulations of the PRC, be paid to the
Company and may be converted into foreign currency that may be freely
transferred out of the PRC, and except as disclosed in the Registration
Statement and the Final Prospectus, all such dividends and distributions will
not be subject to withholding or other taxes under the laws and regulations of
the PRC and are otherwise free and clear of any other tax, withholding or
deduction in the PRC and may be so paid without the necessity of obtaining any
governmental authorization, whether local, provincial or national, in the PRC.

 

(xx)                              PRC Taxes.  Other than
as described in the Final Prospectus, no stamp or other issuance or transfer
taxes or duties and no capital gains, income, withholding or other taxes are
payable by or on behalf of the Company to the PRC or any political subdivision
or taxing authority thereof or therein in connection with the issuance, sale
and delivery of the Securities or the execution, delivery and performance of
this Agreement.  No stamp or other
issuance or transfer taxes or duties and no capital gains, income or
withholding other taxes are payable by or on behalf of the Underwriters to the
PRC or any political subdivision or taxing authority thereof or therein in
connection with the sale and delivery of the Securities to the Underwriters or
by the Underwriters to the initial purchasers thereof, or the execution,
delivery and performance of this Agreement.

 

(xxi)                           Taxes.  Each of the
Company and its subsidiaries has filed all reports or filings required thereof
for taxation purposes, including those required by the PRC or any political
subdivision thereof, and has paid all taxes required to be paid by it and any
other

 

8

 

assessment,
fine or penalty levied against it, to the extent that any of the foregoing is
due and payable, except for any such assessment, fine or penalty that is
currently being contested in good faith or would not have a Material Adverse
Effect.

 

(xxii)                        Sovereign Immunity. 
Under the laws of the PRC, neither the Company nor any of its
subsidiaries, or any of their properties, assets or revenues are entitled to
any right of immunity on the grounds of sovereignty from any legal action, suit
or proceeding, from set off or counterclaim, from the jurisdiction of any
court, from service of process, from attachment to or in aid of execution of
judgment or from other legal process or proceeding for the giving of any relief
or for the enforcement of any judgment.

 

(xxiii)                     Choice of Law.  Under
the laws of the PRC, the courts of the PRC recognize and give effect to the
choice of law provisions set forth herein and enforce judgments of U.S. courts
obtained against the Company to enforce this Agreement, provided that the
judgment (A) was not obtained by fraud; (B) was final and conclusive; (C) in
the opinion of the relevant PRC court after the review of such judgment
pursuant to international treaties concluded or acceded to by the PRC
government or in accordance with the principle of reciprocity, or otherwise in
accordance with the Civil Procedure Law of the PRC, did not contradict the
basic principles of PRC law; and (D) in the opinion of the relevant PRC court
after its review of such judgment pursuant to international treaties concluded
or agreed to by the PRC government or in accordance with the principle of
reciprocity, or otherwise in accordance with the Civil Procedure Law of the
PRC, did not violate state sovereignty, security or public interest.

 

(xxiv)                    Investment Company Act. 
The Company is not, and upon the issuance and sale of the Securities as
herein contemplated and the application of the net proceeds therefrom as
described in the Final Prospectus will not be, required to be registered as an
“investment company” under the
Investment Company Act of 1940, as amended (the “1940 Act”).

 

(xxv)                       Environmental Laws. 
Except as described in the Registration Statement and except as would
not, singly or in the aggregate, reasonably be expected to result in a Material
Adverse Effect, (A) neither the Company nor any of its subsidiaries is in
violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree or judgment, relating to pollution or protection of human
health, the environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata) or wildlife, including,
without limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum or petroleum products (collectively, “Hazardous Materials”) or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, “Environmental Laws”),
(B) the Company and its subsidiaries have all permits, authorizations and
approvals required under any applicable Environmental Laws and are each in
compliance with their requirements, (C) there are no pending or, to the
Company’s knowledge, threatened administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, notices of noncompliance or
violation, investigation or proceedings relating

 

9

 

to any
Environmental Law against the Company or any of its subsidiaries and (D) the
Company is not aware of any events or circumstances that might reasonably be
expected to form the basis of an order for clean up or remediation, or an
action, suit or proceeding by any private of or governmental body or agency,
against the Company or any of its subsidiaries relating to Hazardous Materials
or any Environmental Laws.

 

(xxvi)                    Foreign Corrupt Practices Act.  Neither the Company, any of its subsidiaries,
nor any officer, director, employee or agent thereof or any stockholder thereof
acting on behalf of the Company or any of its subsidiaries, has done any act or
authorized, directed or participated in any act, in violation of any provision
of the United States Foreign Corrupt Practices Act of 1977, as amended, applied
to such entity or person.

 

(xxvii)                 Registration Rights. 
Except as described in the Registration Statement or as have been waived
in writing, there are no persons with registration rights or other similar
rights to have any securities registered pursuant to the Registration Statement
or otherwise registered by the Company under the 1933 Act.

 

Section 2.  Sale and Delivery to
Underwriters; Closing.

 

(a)                        Initial Securities. 
On the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price per share set forth in Schedule D, that proportion of the number
of Initial Securities set forth in Schedule B opposite the name of the
Company which the number of Initial Securities set forth in Schedule A
opposite the name of such Underwriter, plus any additional number of Initial
Securities which such Underwriter may become obligated to purchase pursuant to
the provisions of Section 10 hereof, bears to the total number of Initial
Securities, subject, in each case, to such adjustments among the Underwriters
as the Representative in their sole discretion shall make to eliminate any
sales or purchases of fractional securities.

 

(b)                       Option Securities.  In
addition, on the basis of the representations, warranties and agreements herein
contained and subject to the terms and conditions herein set forth, the Company
hereby grants an option to the Underwriters, severally and not jointly, to
purchase up to an additional 1,815,000 shares of Common Stock at the price per
share set forth in Schedule D, less an amount per share equal to any
dividends or distributions declared by the Company and payable on the Initial
Securities but not payable on the Option Securities.  The option hereby granted will expire 30 days
after the date hereof and may be exercised in whole or in part from time to
time only for the purpose of covering over-allotments which may be made in
connection with the offering and distribution of the Initial Securities upon
notice by the Representative to the Company setting forth the number of Option
Securities as to which the several Underwriters are then exercising the option
and the time and date of payment and delivery for such Option Securities.  Any such time and date of delivery (a “Date of Delivery”) shall be determined by the
Representative, but shall not be later than seven full business days after the
exercise of said option, nor in any event prior to the Closing Time, as
hereinafter defined.  If the option is
exercised as to all or any portion of the Option Securities, each of the
Underwriters, acting severally and not jointly, will purchase that proportion
of the total number

 

10

 

of Option Securities then being purchased which the number of Initial
Securities set forth in Schedule A opposite the name of such Underwriter
bears to the total number of Initial Securities, subject in each case to such
adjustments as the Representative in their discretion shall make to eliminate
any sales or purchases of fractional shares.

 

(c)                        Payment.  Payment of
the purchase price for, and delivery of certificates for, the Initial
Securities shall be made at the offices of Shearman & Sterling LLP, 1080
Marsh Road, Menlo Park, CA 94025, or at such other place as shall be agreed upon
by the Representative and the Company at 6:00 A.M. (California time) on the
third (fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any
given day) business day after the date hereof (unless postponed in accordance
with the provisions of Section 10), or such other time not later than ten
business days after such date as shall be agreed upon by the Representative and
the Company (such time and date of payment and delivery being herein called “Closing Time”).

 

In addition,
in the event that any or all of the Option Securities are purchased by the
Underwriters, payment of the purchase price for, and delivery of certificates
for, such Option Securities shall be made at the above-mentioned offices, or at
such other place as shall be agreed upon by the Representative and the Company,
on each Date of Delivery as specified in the notice from the Representative to
the Company.

 

Payment shall
be made to the Company by wire transfer of immediately available funds to a
bank account designated by the Company against delivery to the Representative
for the respective accounts of the Underwriters of certificates for the
Securities to be purchased by them.  It
is understood that each Underwriter has authorized the Representative, for its
account, to accept delivery of, receipt for, and make payment of the purchase
price for, the Initial Securities and/or the Option Securities, if any, which
it has agreed to purchase.  Banc of
America Securities LLC, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve such Underwriter from its obligations hereunder.

 

(d)                       Denominations; Registration. 
Certificates for the Initial Securities and the Option Securities, if
any, shall be in such denominations and registered in such names as the
Representative may request in writing at least two full business days before
the Closing Time or the relevant Date of Delivery, as the case may be.  The certificates for the Initial Securities and
the Option Securities, if any, will be made available for examination and
packaging by the Representative in The City of New York not later than 10:00
A.M. (Eastern time) on the business day prior to the Closing Time or the
relevant Date of Delivery, as the case may be.

 

Section 3.  Covenants of the Company.  The Company covenants with each
Underwriter as follows:

 

(a)                        Compliance with Securities Regulations and Commission Requests.  The Company, subject to Section 3(b),
will notify the Representative immediately, and confirm the notice in writing,
(i) when any post-effective amendment to the Registration Statement shall
become effective, or any supplement to the Basic Prospectus or any amended
Final Prospectus shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the

 

11

 

Commission for any amendment to the Registration Statement or any
amendment or supplement to the Final Prospectus or any document incorporated by
reference therein or for additional information, and (iv) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes.  The Company will promptly file the Final
Prospectus with the Commission within the time periods specified by
Rule 424(b) and will take such steps as it deems necessary to ascertain
promptly whether the form of Final Prospectus transmitted for filing under Rule
424(b) was received for filing by the Commission and, in the event that it was
not, it will promptly file such Final Prospectus.  The Company will make every reasonable effort
to prevent the issuance of any stop order and, if any stop order is issued, to
obtain the lifting thereof at the earliest possible moment.  The Company will prepare and file with the
Commission the Rule 462(b) Registration Statement, if necessary, in a form
approved by the Representative (which approval shall not be unreasonably
withheld or delayed) in order for the Underwriters to exercise the
over-allotment option granted to them pursuant to Section 2(b) hereof.

 

(b)                       Filing of Amendments. 
The Company will give the Representative notice of its intention to file
or prepare any amendment to the Registration Statement (including any filing
under Rule 462(b)) or any amendment, supplement or revision to either the Basic
Prospectus included in the Registration Statement at the time it became
effective or to the Final Prospectus, whether pursuant to the 1933 Act, the
1934 Act or otherwise, will furnish the Representative with copies of any such
documents a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file or use any such document to which the
Representative or counsel for the Underwriters shall object.

 

(c)                        Delivery of Registration Statements.  The Company has furnished or will deliver to
the Representative and counsel for the Underwriters, without charge, signed
copies of the Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by reference
therein and documents incorporated or deemed to be incorporated by reference
therein) and signed copies of all consents and certificates of experts, and
will also deliver to the Representative, without charge, a conformed copy of
the Registration Statement as originally filed and of each amendment thereto
(without exhibits) for each of the Underwriters.  The copies of the Registration Statement and
each amendment thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.

 

(d)                       Delivery of Prospectuses. 
The Company will furnish to each Underwriter, without charge, during the
period when the Final Prospectus is required to be delivered under the 1933 Act
or the 1934 Act, such number of copies of the Final Prospectus (as amended or
supplemented) as such Underwriter may reasonably request.  The Final Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.

 

(e)                        Continued Compliance with Securities Laws.  The Company will comply with the 1933 Act and
the 1933 Act Regulations and the 1934 Act and the 1934 Act Regulations so as to
permit the completion of the distribution of the Securities as contemplated in
this Agreement and

 

12

 

in the Final Prospectus.  If at
any time when a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Securities, any event shall occur or condition
shall exist as a result of which it is necessary, in the opinion of counsel for
the Underwriters or for the Company, to amend the Registration Statement or
amend or supplement the Final Prospectus in order that the Final Prospectus
will not include any untrue statements of a material fact or omit to state a
material fact necessary in order to make the statements therein not misleading
in the light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such counsel, at any
such time to amend the Registration Statement or amend or supplement the Final
Prospectus in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, the Company will promptly prepare and file with the
Commission, subject to Section 3(b), such amendment or supplement as may
be necessary to correct such statement or omission or to make the Registration
Statement or the Final Prospectus comply with such requirements, and the
Company will furnish to the Underwriters such number of copies of such
amendment or supplement as the Underwriters may reasonably request.

 

(f)                          Blue Sky Qualifications. 
The Company will use its best efforts, in cooperation with the
Underwriters, to qualify the Securities for offering and sale under the
applicable securities laws of such states and other jurisdictions (domestic or
foreign) as the Representative may designate and to maintain such
qualifications in effect for a period of not less than one year from the later
of the effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which
it is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject.

 

(g)                       Rule 158.  The Company
will timely file such reports pursuant to the 1934 Act as are necessary in
order to make generally available to its security holders as soon as
practicable an earnings statement for the purposes of, and to provide the
benefits contemplated by, the last paragraph of Section 11(a) of the 1933
Act.

 

(h)                       Use of Proceeds.  The
Company will use the net proceeds received by it from the sale of the
Securities in the manner specified in the Final Prospectus under “Use of Proceeds.”

 

(i)                           Listing.  The Company
will use its best efforts to effect and maintain the quotation of the
Securities on the Nasdaq National Market and will file with the Nasdaq National
Market all documents and notices required by the Nasdaq National Market of
companies that have securities that are traded in the over-the-counter market
and quotations for which are reported by the Nasdaq National Market.

 

(j)                           Restriction on Sale of Securities.  During a period of 90 days from the date of
the Final Prospectus (the “Lockup Period”),
the Company will not, without the prior written consent of Banc of America
Securities LLC, (i) directly or indirectly, offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase or otherwise transfer
or dispose of any share of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock or file any registration statement
under the 1933 Act with respect to any of the foregoing or publicly disclose
the intention to do any of the foregoing, (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic

 

13

 

consequence of ownership of the Common Stock, whether any such swap or
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise.  The foregoing sentence shall not apply to (A)
the Securities to be sold hereunder, (B) any shares of Common Stock issued by
the Company upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof and referred to in the Final
Prospectus, (C) any shares of Common Stock issued or options to purchase Common
Stock granted pursuant to existing employee benefit plans of the Company
referred to in the Final Prospectus, (D) any shares of Common Stock issued pursuant
to any non-employee director stock plan or dividend reinvestment plan, (E) any
shares of Common Stock or securities convertible into or exchangeable for
Common Stock issued in connection with acquisitions (by purchase, merger or
otherwise) of other entities (or substantially all of the assets or operations
of other entities) if the recipients of such securities each executes a lockup
agreement with Banc of America Securities LLC in form and substance
substantially similar to the lockup set forth in this Section 3(i), or (F)
any filing of any registration statement on Form S-8 under the 1933 Act.

 

(k)                        Reporting Requirements. 
The Company, during the period when Final Prospectuses are required to
be delivered under the 1933 Act or the 1934 Act, will file all documents
required to be filed with the Commission pursuant to the 1934 Act within the
time periods required by the 1934 Act and the 1934 Act Regulations.

 

(l)                           No Amendment of 10b5-1 Plans.  During the Lockup Period, the Company will
not permit the amendment of any 10b5-1 Plan unless such amendment does not
become effective until after the expiration of Lockup Period.  For purposes of this Agreement, a “10b5-1 Plan” is a contract adopted prior to the date hereof
under Rule 10b5-1 under the Exchange Act between the Company and any of its
executive officers or directors, a copy of which has been provided to Banc of
America Securities LLC.

 

Section 4.  Payment and Expenses.

 

(a)                        Expenses.  The Company
will pay or cause to be paid all expenses incident to the performance of the
Company’s obligations under this Agreement, including (i) the preparation,
printing and filing of the Registration Statement (including financial
statements and exhibits) as originally filed and of each amendment thereto,
(ii) the preparation, printing and delivery to the Underwriters of this
Agreement and such other documents as may be required in connection with the
offering, purchase, sale, issuance or delivery of the Securities, (iii) the
preparation, issuance and delivery of the certificates for the Securities to
the Underwriters, including any stock or other transfer taxes and any stamp or
other duties payable upon the sale, issuance or delivery of the Securities to
the Underwriters, (iv) the fees and disbursements of the Company’s counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of the Final Prospectus and any
amendments or supplements thereto, (vii) the preparation, printing and delivery
to the Underwriters of copies of the Blue Sky Survey and any supplement
thereto, (viii) the fees and expenses of any transfer agent or registrar for
the Securities, (ix) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review by
the National Association of Securities Dealers, Inc. (the “NASD”)
of the terms of the sale of the Securities,

 

14

 

(x) any stamp duties, capital duties and stock transfer taxes, if any,
payable upon the sale of the Securities to the Underwriters and their transfer
between the Underwriters pursuant to an agreement between such Underwriters and
(xi) the fees and expenses incurred in connection with the inclusion of the
Securities in the Nasdaq National Market.

 

(b)                       Termination of Agreement. 
If this Agreement is terminated by the Representative in accordance with
the provisions of Section 5, Section 9(a)(i) or Section 11
hereof, the Company shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.

 

Section 5.  Conditions of Underwriters’
Obligations.  The obligations
of the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1
hereof or in certificates of any officer of the Company or any subsidiary of
the Company delivered pursuant to the provisions hereof, to the performance by
the Company of its covenants and other obligations hereunder, and to the
following further conditions:

 

(a)                        Effectiveness of Registration Statement.  The Registration Statement, including any
Rule 462(b) Registration Statement, has become effective and at Closing Time no
stop order suspending the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, and any request on the part of the Commission for
additional information shall have been complied with to the reasonable
satisfaction of counsel to the Underwriters. 
The Final Prospectus shall have been filed with the Commission in
accordance with Rule 424(b).

 

(b)                       Opinion of Counsel for the Company.  At Closing Time, the Representative shall
have received the favorable opinion, dated as of Closing Time, of
Shearman & Sterling LLP, counsel for the Company substantially in the
form attached hereto as Exhibit A.

 

(c)                        Opinion of PRC Counsel for the Company.  At Closing Time, the Representative shall
have received the favorable opinion, dated as of Closing Time, of Jun He Law
Offices, PRC counsel for the Company, in form and substance satisfactory to the
Representative and counsel for the Underwriters, together with signed or
reproduced copies of such letter for each of the other Underwriters to the
effect that:

 

(i)                                     Each
of UTStarcom China, Ltd. and UTStarcom Telecom Co., Ltd. (each, a “PRC Subsidiary” and collectively the “PRC
Subsidiaries”) has been duly organized and is validly existing and
duly qualified as a foreign investment enterprise with limited liability under
PRC law, and its business license is in full force and effect; each has full
power and authority (corporate and other) and has all consents, approvals,
authorizations, orders, registrations, clearances and qualifications of or with
any court, governmental agency or body having jurisdiction over it or any of
its properties required for the ownership or lease of property by it and the
conduct of its business, and has the legal right and authority to own, use,
lease and operate its assets and to conduct its business as described in the
Final Prospectus; each of the Company and the PRC Subsidiaries can sue and be
sued in its own name under the laws of the PRC;

 

15

 

(ii)                                  The
Company, as a foreign corporation for transaction of business in the PRC, has
all necessary licenses, consents, authorizations, approvals, orders,
certificates and permits of and from, and has made all declarations and filings
with all governmental agencies to own, use or lease its properties and conduct
business as described in the Final Prospectus;

 

(iii)                               The
equity interests of the Company in each of the PRC Subsidiaries have been duly
and validly authorized and issued, are fully paid and nonassessable and are
legally owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims; no additional governmental approval or
authorization of or filing with any governmental agency is required under PRC
law for the ownership by the Company of its equity interests in each of the PRC
Subsidiaries, except the approval from or registration with the relevant
governmental authorities, including, without limitation, the relevant local
branches of the Ministry of Commerce (“MOC”), the
State Administration of Industry and Commerce (“SAIC”),
the State Administration for Foreign Exchange (“SAFE”),
the State Administration of Taxation and the General Administration of Customs,
which has been obtained and is in full force and effect; the liability of the
Company in respect of its equity interests in each of the PRC Subsidiaries is
limited to its investment therein;

 

(iv)                              Based
on our general review of the title documents and without independent check or
verification thereof, the PRC Subsidiaries have valid title to, or valid
leasehold interests in, all of their material real and personal property owned
by them, in each case free and clear of all liens, encumbrances, third party
rights or interests, defects or any other restrictions except such as do not
materially affect the value of such property and do not interfere with the use
made and proposed to be made of such property by them; and any real property
and buildings held under lease by the PRC Subsidiaries are held by them under
valid and enforceable leases in full force and effect, with such exceptions as
are not material and do not interfere with the use made and proposed to be made
of such property and buildings by them;

 

(v)                                 To
the best of our knowledge and other than as set forth in the Final Prospectus,
there are no pending actions, suits or proceedings by or before any court or
governmental agency, authority or body or any arbitrator in the PRC to which
any of the Company, the PRC Subsidiaries is a party or of which any property of
the Company, the PRC Subsidiaries is subject which, if determined adversely to
the Company, the PRC Subsidiaries, would individually or in the aggregate
result in any material adverse change or any event involving a prospective
material adverse change, in or affecting the general affairs, management,
financial position, stockholders’ equity or results of operations of the
Company and its subsidiaries, taken as a whole; and, to the best of our
knowledge, no such actions, suits or proceedings are threatened or
contemplated;

 

(vi)                              The
issue and sale of the Securities to be sold by the Company and the execution,
delivery and performance by the Company of this Agreement and the consummation
of the transactions herein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to us to which any of the PRC Subsidiaries is a
party or by which any of the PRC

 

16

 

Subsidiaries
is bound or to which any of the property or assets of the PRC Subsidiaries is
subject, nor will such action result in any violation of the provisions of
articles of association or business licenses of any of the PRC Subsidiaries or
any law or statute or any order, rule or regulation known to us of any
governmental agency having jurisdiction over the PRC Subsidiaries or any of
their properties;

 

(vii)                           No
governmental authorization, approval or consent of or filing with any
governmental agency is required under PRC law for the consummation by the
Company of the transactions contemplated by this Agreement;

 

(viii)                        Except as
described in the Registration Statement or the Final Prospectus or as
incorporated by reference therein, the PRC Subsidiaries have all necessary
licenses, consents, authorizations, approvals, orders, certificates and permits
of and from, and have made all declarations and filings with all governmental
agencies to own, lease, license and use their properties and assets and conduct
their business as described in the Final Prospectus.  Except as described in the Final Prospectus,
neither the Company nor any of the PRC Subsidiaries has any reason to believe
that the Ministry of Information Industry or any other regulatory body is
considering modifying, suspending or revoking any such licenses, consents,
authorizations, approvals, orders, certificates or permits and each of the
Company, the PRC Subsidiaries is in compliance with the provisions of all such
licenses, consents, authorizations, approvals, orders, certificates or permits
in all material respects;

 

(ix)                                To
the best of our knowledge, none of the PRC Subsidiaries is in violation of its
constituent documents (including, without limitation, articles of association)
or in default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage, deed of
trust, loan, lease or other agreement or instrument to which it is a party or
by which it or any of its properties may be bound; the business and operations
conducted by the PRC Subsidiaries are in compliance with any PRC laws and
regulations applicable to the PRC Subsidiaries;

 

(x)                                   Current
PRC laws and regulations permit foreign investment in the telecommunications
services industry, subject to certain ownership and geographic
restrictions.  After due inquiry, we have
no legal basis to form an opinion that any of the Subsidiaries invests in,
operates, or participates in the operation of, any telecommunications services
in the PRC as restricted by current PRC laws and regulations;

 

(xi)                                All
necessary licenses, approvals, certificates or permits for the connection of
products to telecommunications networks within the PRC have been duly obtained
for each of the products of the Company and the PRC Subsidiaries sold,
distributed and marketed in the PRC for which such licenses, approvals,
certificates or permits are required, except such as described in the Final
Prospectus;

 

(xii)                             The
statements set forth in the Final Prospectus under the captions “Risk Factors”
to the extent such statements relate to matters of PRC law or regulation or to
the provisions of documents therein described, are fair summaries of such
matters and are correct in all material respects;

 

17

 

(xiii)                          No stamp
or other issuance or transfer taxes or duties and no capital gains, income,
withholding or other taxes are payable by or on behalf of the Underwriters to
the PRC or to any political subdivision or taxing authority thereof or therein
in connection with (i) the issuance, sale and delivery by the Company of the
Securities to or for the respective accounts of the Underwriters or (ii) the
sale and delivery outside the PRC by the Underwriters of the Securities to the
initial purchasers thereof in the manner contemplated in this Agreement;

 

(xiv)                         The
entering into, performance and enforcement of this Agreement in accordance with
its terms and conditions will not subject the Underwriters to a requirement to
be licensed or otherwise qualified to do business in the PRC, nor will any
Underwriter be deemed to be resident, domiciled, carrying on business through
an establishment or place in the PRC or in breach of any laws or regulations of
the PRC by reason of entering into, performance or enforcement of this
Agreement;

 

(xv)                            All
dividends and other distributions declared and payable upon the equity
interests in the PRC Subsidiaries to the Company may be converted into foreign
currency that may be freely transferred out of the PRC, and all such dividends
and other distributions are not and, except as disclosed in the Registration
Statement and the Final Prospectus, will not be subject to withholding or other
taxes under the laws and regulations of the PRC and, except as disclosed in the
Registration Statement and the Final Prospectus, are otherwise free and clear of
any other tax, withholding or deduction under PRC law, in each case without the
necessity of obtaining any governmental approval or authorization in the PRC,
except such as have been obtained;

 

(xvi)                         The
Company’s stock option, stock purchase and other similar plans (including the
plans of the Company’s subsidiaries and acquired Companies) and the sale,
issuance and grant of any securities under any of the aforementioned plans to
the date hereof, to the extent applicable to employees of any of the PRC Subsidiaries,
do not violate any provisions of the foreign exchange laws and regulations of
the PRC or any other applicable PRC laws and regulations, provided that any
payment made under any of the aforementioned plans by any PRC citizen has been
accepted in a cashless manner;

 

(xvii)                      Under the
applicable PRC tax law, UTStarcom (China), Ltd. is entitled to reduced taxes at
the rate of 10% in 2003.  UTStarcom
Telecom Co., Ltd. is entitled to reduced taxes at the rate of 15% in 2003; to
the best of our knowledge, we are not aware of any event or  circumstance which may result in such rates
being invalid or ineffective or capable of being revoked;

 

(xviii)                   Insofar as
matters of the law of the PRC are concerned, the Registration Statement and the
filing of the Registration Statement with the Commission has been duly
authorized by and on behalf of the Company, and the Registration Statement has
been executed pursuant to such authorization by or on behalf of the Company;

 

(xix)                           Although
we do not assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement or the Final
Prospectus, except for those referred to in the opinion in
subsection (xii) of this opinion, nothing has come to our attention that led
us to believe that, as of its effective

 

18

 

date, the
Registration Statement or any further amendment thereto made by the Company
prior to the later date of the Closing Time and the last Date of Delivery (other
than the financial statements, as to which we need express no opinion)
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
insofar as they relate to matters of PRC laws and regulations and the
provisions of the documents entered into by each of the Company and the PRC
Subsidiaries in connection with the business conducted by each of them in the
PRC, not misleading or that, as of its date, the Final Prospectus or any
further amendment or supplement thereto made by the Company prior to the later
date of the Closing Time and the last Date of Delivery (other than the
financial statements and related schedules therein, as to which we need express
no opinion) contained an untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein, insofar as they
relate to matters of PRC laws and regulations and the provisions of the
documents entered into by each of the Company and the PRC Subsidiaries in
connection with the business conducted by each of them in the PRC, in the light
of the circumstances under which they were made, not misleading or that, as of
the later date of the Closing Time and the last Date of Delivery, the
Registration Statement, the Final Prospectus or any further amendment or
supplement thereto made by the Company prior to such date (other than the
financial statements and related schedules therein as to which we need express
no opinion) contains an untrue statement of a material fact or omits to state a
material fact necessary to make the statements therein, insofar as they relate
to matters of PRC laws and regulations and the provisions of the documents
entered into by each of the Company and the PRC Subsidiaries in connection with
the business conducted by each of them in the PRC, in the light of the
circumstances under which they were made, not misleading;

 

(xx)                              Except
as described in the Final Prospectus, insofar as matters of PRC laws and regulations
are concerned, each of the Company and the PRC Subsidiaries owns, possesses, or
otherwise has the right to use, and has made all necessary registration and
applications with all governmental agencies to own, possess and use, the
Intellectual Property necessary to carry on the business currently operated by
it and as described in the Final Prospectus, and to the best of our knowledge,
has not received any notice of infringement or conflict with asserted rights of
others with respect to any such intellectual property rights that, if
determined adversely to the Company or any of the PRC Subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.

 

(d)                       Opinion of Counsel for the Underwriters.  At Closing Time, the
Representative shall have received the favorable opinion, dated as of Closing
Time, of Davis Polk & Wardwell, counsel for the Underwriters, in form and
substance satisfactory to the Representative, together with signed or
reproduced copies of such letter for each of the other Underwriters, and such
counsel shall have received or been permitted access to such papers and
information as they may reasonably request to enable them to give such opinion.

 

(e)                        Officers’ Certificate.  At
Closing Time, there shall not have been, since the date hereof or since the
respective dates as of which information is given in the Final Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries taken as a whole, whether or not arising in ordinary course of
business, and the Representative shall have received a certificate

 

19

 

of the President or a Vice President of the
Company and of the chief financial or chief accounting officer of the Company,
dated as of Closing Time, to the effect that (i) there has been no such
material adverse change, (ii) the representations and warranties in
Section 1(a) hereof are true and correct in all material respects with the
same force and effect as though expressly made at and as of Closing Time, (iii)
the Company has complied in all material respects with all agreements and
satisfied in all material respects all conditions on its part to be performed
or satisfied at or prior to Closing Time and (iv) to the knowledge of such
officers, based on due inquiry, no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for that purpose
have been instituted by the Commission.

 

(f)                          Accountant’s Comfort Letter.  At
the time of the execution of this Agreement, the Representative shall have
received from PricewaterhouseCoopers LLP a letter dated such date, in form and
substance satisfactory to the Representative, together with signed or
reproduced copies of such letter for each of the other Underwriters containing
statements and information of the type ordinarily included in accountants’
“comfort letters” to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement and the
Final Prospectus.

 

(g)                       Bring-down Comfort Letter.  At
Closing Time, the Representative shall have received from
PricewaterhouseCoopers LLP a letter, dated as of Closing Time, to the effect
that they reaffirm the statements made in the letter furnished pursuant to
subsection (h) of this Section, except that the specified date referred to
shall be a date not more than three business days prior to Closing Time.

 

(h)                       Lockup Agreements.  At
Closing Time, the Representative shall have received an agreement substantially
in the form of Exhibit B hereto from each of the Company’s directors and
executive officers, each of whom is listed in Schedule E, and an agreement
substantially in the form of Exhibit C hereto from SOFTBANK America, Inc.

 

(i)                           Conditions to Purchase of Option Securities.  In the event that the Underwriters
exercise their option provided in Section 2(b) hereof to purchase all or
any portion of the Option Securities, the representations and warranties of the
Company contained herein and the statements in any certificates furnished by
the Company or any subsidiary of the Company hereunder shall be true and
correct in all material respects as of each Date of Delivery and, at the
relevant Date of Delivery, the Representative shall have received:

 

(i)                                     Officers’ Certificate. 
A certificate, dated such Date of Delivery, of the President or a Vice
President of the Company and of the chief financial or chief accounting officer
of the Company confirming that the certificate delivered at the Closing Time
pursuant to Section 5(e) hereof 
remains true and correct as of such Date of Delivery;

 

(ii)                                  Opinion of Counsel for the Company.  The favorable opinion of Shearman &
Sterling LLP, counsel for the Company, dated such Date of Delivery, relating to
the Option Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(b) hereof.

 

20

 

(iii)                               Opinion of PRC Counsel for the Company.  The favorable opinion of Jun He Law Offices,
PRC counsel for the Company, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(c) hereof.

 

(iv)                              Opinion of Counsel for the Underwriters.  The favorable opinion of Davis Polk &
Wardwell, counsel for the Underwriters, dated such Date of Delivery, relating
to the Option Securities to be proposed on such Date of Delivery and otherwise
to the same effect as the opinion required Section 5(d) hereof.

 

(v)                                 Bring-down Comfort Letter. 
A letter from PricewaterhouseCoopers LLP, in form and substance
satisfactory to the Representative and dated such Date of Delivery,
substantially in the same form and substance as the letter furnished to the
Representative pursuant to Section 5(f) hereof, except that the “specified
date” in the letter furnished pursuant to this paragraph shall be a date not
more than five days prior to such Date of Delivery.

 

(j)                           Additional Documents.  At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be satisfactory in form and substance to the
Representative and counsel for the Underwriters.

 

(k)                        Termination of Agreement.  If any condition specified in this Section shall
not have been fulfilled when and as required to be fulfilled, this Agreement,
or, in the case of any condition to the purchase of Option Securities, on a
Date of Delivery which is after the Closing Time, the obligations of the
several Underwriters to purchase the relevant Option Securities, may be
terminated by the Representative by notice to the Company at any time at or
prior to Closing Time or such date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party except
as provided in Section 4 and except that Sections 1, 6, 7 and 8 shall
survive any such termination and remain in full force and effect.

 

Section 6.  Indemnification.

 

(a)                        Indemnification of the Underwriters by the Company.  The Company agrees to indemnify and hold
harmless each Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act as follows:

 

(i)                                     against
any and all loss, liability, claim, damage and expense whatsoever, as incurred,
arising out of any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment thereto) or the
omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or arising
out of any untrue statement or alleged untrue statement of a material fact
included in the Final Prospectus (or any

 

21

 

amendment or
supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading;

 

(ii)                                  against
any and all loss, liability, claim, damage and expense whatsoever, as incurred,
to the extent of the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency or body, commenced
or threatened, or of any claim whatsoever based upon any such untrue statement
or omission, or any such alleged untrue statement or omission; provided that
(subject to Section 6(d) below) any such settlement is effected with the
written consent of the Company; and

 

(iii)                               against
any and all expense whatsoever, as incurred (including the fees and
disbursements of a single counsel chosen by Banc of America Securities LLC),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission or any such alleged untrue statement or omission,
to the extent that any such expense is not paid under (i) or (ii) above;

 

provided, however,
that the indemnity agreement contained in this Section 6(a) shall not
apply to any loss, liability, claim, damage or expense to the extent arising
out of any untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with written information furnished to
the Company by any Underwriter through the Representative expressly for use in
the Registration Statement (or any amendment thereto), or the Final Prospectus.

 

(b)                       Indemnification of the Company, Directors and Officers.  Each Underwriter severally agrees to
indemnify and hold harmless the Company, its directors, each of its officers
who signed the Registration Statement, and each person, if any, who controls
the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all loss, liability, claim,
damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions made in the Registration
Statement (or any amendment thereto) or the Final Prospectus in reliance upon
and in conformity with written information furnished to the Company by such
Underwriter through the Representative expressly for use in the Registration
Statement (or any amendment thereto) or the Final Prospectus.

 

(c)                        Actions Against Parties. 
Notification.  Each indemnified
party shall give notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder to
the extent it is not materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement.  In
the case of parties indemnified pursuant to subsection (a) above, counsel
to the indemnified parties shall be selected by Banc of America Securities LLC,
and, in the case of parties indemnified pursuant to Section 6(b) above,
counsel to the indemnified parties shall be selected by the Company.  An indemnifying party may participate at its
own expense in the defense of any such

 

22

 

action; provided, however, that counsel to the indemnifying party shall
not (except with the consent of the indemnified party) also be counsel to the
indemnified party.  In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar
or related actions in the same jurisdiction arising out of the same general
allegations or circumstances.  No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever
in respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from
all liability arising out of such litigation, investigation, proceeding or
claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.

 

(d)                       Settlement Without Consent If Failure to Reimburse.  If at any time an indemnified party shall
have requested an indemnifying party to reimburse the indemnified party for
fees and expenses of counsel, such indemnifying party agrees that it shall be
liable for any settlement of the nature contemplated by Sections 6(a)(ii) and
6(b)(ii) above effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.

 

Section 7.  Contribution.  If the indemnification provided
for in Section 6 hereof is for any reason unavailable to or insufficient
to hold harmless an indemnified party in respect of any losses, liabilities,
claims, damages or expenses referred to therein, then each indemnifying party
shall contribute to the aggregate amount of such losses, liabilities, claims,
damages and expenses incurred by such indemnified party, as incurred, (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Underwriters on the other hand from the
offering of the Securities pursuant to this Agreement or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company on the one hand and
of the Underwriters on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.

 

The relative
benefits received by the Company on the one hand and the Underwriters on the
other hand in connection with the offering of the Securities pursuant to this
Agreement shall be deemed to be in the same respective proportions as the total
net proceeds from the offering of the Securities pursuant to this Agreement
(before deducting expenses) received by the Company and the total underwriting
discount received by the Underwriters, in each case as set forth on the cover
of the Final Prospectus, bear to the aggregate initial public offering price of
the Securities as set forth on such cover.

 

23

 

The relative
fault of the Company on the one hand and the Underwriters on the other hand
shall be determined by reference to, among other things, whether any such
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Company or by the Underwriters and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.

 

The Company
and the Underwriters agree that it would not be just and equitable if
contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7.  The aggregate amount of losses, liabilities,
claims, damages and expenses incurred by an indemnified party and referred to
above in this Section 7 shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue or alleged untrue statement or
omission or alleged omission.

 

Notwithstanding
the provisions of this Section 7, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of any such untrue or alleged untrue
statement or omission or alleged omission.

 

No person
guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.

 

For purposes
of this Section 7, each person, if any, who controls an Underwriter within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act shall have the same rights to contribution as such Underwriter, and each
director of the Company, each officer of the Company who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company, as the case may be.  The Underwriters’ respective obligations to
contribute pursuant to this Section 7 are several in proportion to the
number of Initial Securities set forth opposite their respective names in
Schedule A hereto and not joint.

 

Section 8.  Representations, Warranties
and Agreements to Survive Delivery.  All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its subsidiaries submitted
pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or an behalf of the Company, and shall survive
delivery of the Securities to the Underwriters.

 

24

 

Section 9.  Termination of Agreement.

 

(a)                        Termination; General. 
The Representative may terminate this Agreement, by notice to the
Company, at any time at or prior to Closing Time (i) if there has been, since
the time of execution of this Agreement or since the respective dates as of which
information is given in the Final Prospectus (exclusive of any supplement
thereto), any material adverse change in the condition, financial or otherwise,
or in the earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there has occurred any material adverse
change in the financial markets in the United States, China or in the
international financial markets, any outbreak of hostilities or escalation
thereof or other calamity or crisis or any change or development involving a
prospective change in national or international political, financial or
economic conditions, in each case the effect of which is such as to make it, in
the judgment of the Representative, impracticable or inadvisable to market the
Securities or to enforce contracts for the sale of the Securities, or (iii) if
trading in any securities of the Company has been suspended or materially
limited by the Commission or the Nasdaq National Market, or if trading
generally on the American Stock Exchange or the New York Stock Exchange or in
the Nasdaq National Market has been suspended or materially limited, or minimum
or maximum prices for trading have been fixed, or maximum ranges for prices
have been required, by any of said exchanges or by such system or by order of
the Commission, the National Association of Securities Dealers, Inc. or any
governmental authority, or a material disruption has occurred in commercial banking
or securities settlement or clearance services in the United States, (iv) if a
banking moratorium has been declared by Federal or New York or PRC authorities,
(v) if a change or development involving a prospective change in United States
or PRC taxation affecting the Company or the Securities or the transfer thereof
or the imposition of exchange controls by the United States or any change or
development involving a prospective change in the PRC exchange controls would
materially and adversely affect the financial markets or the market for the
Securities and other equity securities, or (vi) if the outbreak or escalation
of hostilities involving the United States or the PRC or the declaration by the
United States or the PRC of a national emergency or war makes it impracticable
or inadvisable to proceed with the public offering or the delivery of the
Securities being delivered at such Date of Delivery on the terms and in the
manner contemplated in this Agreement and the Final Prospectus.

 

(b)                       Liabilities.  If this
Agreement is terminated pursuant to this Section, such termination shall be
without liability of any party to any other party except as provided in
Section 4 hereof, and provided further that Sections 1, 6, 7 and 8 shall
survive such termination and remain in full force and effect.

 

Section 10.  Default by One or More of the
Underwriters.  If one or more
of the Underwriters shall fail at Closing Time or a Date of Delivery to
purchase the Securities which it or they are obligated to purchase under this
Agreement (the “Defaulted Securities”), the
Representative shall, within 24 hours thereafter, make arrangements for one or
more of the non-defaulting Underwriters, to purchase all, but not less than
all, of the Defaulted Securities in such amounts as may be agreed upon and upon
the terms herein set forth; if, however, the Representative shall not have
completed such arrangements within such 24 hour period, then:

 

(a)                        if the
number of Defaulted Securities does not exceed 10% of the number of Securities
to be purchased on such date, each of the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount thereof in
the proportions that

 

25

 

their respective underwriting obligations hereunder bear to the
underwriting obligations of all non defaulting Underwriters, or

 

(b)                       if the
number of Defaulted Securities exceeds 10% of the number of Securities to be
purchased on such date, this Agreement or, with respect to any Date of Delivery
which occurs after the Closing Time.  The
non-defaulting Underwriters shall have the right to purchase all, but shall not
be under any obligation to purchase any , of the Securities, and if such non-defaulting
Underwriters do not purchase all the Securities at the Delivery Date, the
obligation of the Underwriters to purchase and of the Company to sell the
Option Securities to be purchased and sold on such Date of Delivery shall
terminate without liability on the part of any non defaulting Underwriter.

 

No action
taken pursuant to this Section shall relieve any defaulting Underwriter
from liability in respect of its default.

 

In the event
of any such default which does not result in a termination of this Agreement
or, in the case of a Date of Delivery which is after the Closing Time, which
does not result in a termination of the obligation of the Underwriters to
purchase and the Company to sell the relevant Option Securities, as the case
may be, either (i) the Representative or (ii) the Company together shall have
the right to postpone Closing Time and the Company shall have the right to
postpone the relevant Date of Delivery, as the case may be, for a period not
exceeding seven days in order to effect any required changes in the
Registration Statement or Final Prospectus or in any other documents or
arrangements.  As used herein, the term
“Underwriter” includes any person substituted for an Underwriter under this
Section 10.

 

Section 11.  Default by the Company.

 

(a)                        If the
Company shall fail at Closing Time to sell the number of Securities that it is
obligated to sell hereunder, then this Agreement shall terminate without any
liability on the part of any nondefaulting party; provided, however, that the
provisions of Sections 1, 4, 6, 7 and 8 shall remain in full force and
effect.  No action taken pursuant to this
Section 11(a) shall relieve the Company from liability, if any, in respect
of such default.

 

(b)                       If the
Company shall fail at a Date of Delivery to sell the number of Option
Securities that it is obligated to sell hereunder, then this Agreement shall
terminate without any liability on the part of any nondefaulting party;
provided, however, that the provisions of Sections 1, 4, 6, 7 and 8 shall
remain in full force and effect.  No
action taken pursuant to this Section 11(b) shall relieve the Company from
liability, if any, in respect of such default.

 

Section 12.  Notices.  All notices and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if mailed or transmitted by any standard form of
telecommunication.  Notices to the
Underwriters shall be directed to the Representative at Banc of America
Securities LLC, 9 West 57th Street, New York, New York 10019,
attention Nicholas Ganz, with a copy to Davis Polk & Wardwell, 1600 El
Camino Real, Menlo Park, California 94025, attention of Alan Denenberg; and
notices to the Company shall be directed to it at UTStarcom, Inc., 1275 Harbor
Bay Parkway, Suite 100, Alameda, California 94502, attention of Hong Lu, with a
copy to Shearman & Sterling LLP, 1080 Marsh Road, Menlo Park,
California 94025, attention of Carmen Chang.

 

26

 

Section 13.  Parties.  This Agreement shall each inure to
the benefit of and be binding upon the Underwriters and the Company and their
respective successors.  Nothing expressed
or mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the Underwriters and the Company and
their respective successors and the controlling persons and officers and
directors referred to in Sections 6 and 7 and their heirs and legal
representatives any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained.  This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
Underwriters and the Company and their respective successors, and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or
corporation.  No purchaser of Securities
from any Underwriter shall be deemed to be a successor by reason merely of such
purchase.

 

Section 14.  Governing Law and Time.  THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.  EXCEPT AS OTHERWISE SET FORTH HEREIN,
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.

 

Section 15. The Headings.  The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.

 

Section 16.   Counterparts.  This Agreement may be executed by
any one or more of the parties hereto in any number of counterparts, each of
which shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.

 

Section 17.  No Other Agreements.  The parties hereto acknowledge that this
agreement represents the sole understanding and agreement between the parties
with respect to the subject matter hereof and supersedes any prior
understandings or agreements that may have existed.

 

27

 

If the
foregoing is in accordance with your understanding of our agreement, please
sign and return to the Company, a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement
between the Underwriters and the Company in accordance with its terms.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  UTSTARCOM, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Sophie

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Michael Sophie

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President of Finance &

  Chief Financial Officer

  
					

 

 

	
  CONFIRMED AND ACCEPTED,

  	
   

  
	
  as of the date first above written:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  BANC OF AMERICA SECURITIES LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ 

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  	
   

  

 

For themselves
and as Representative of the other Underwriters named in Schedule A
hereto.

 

 

SCHEDULE A

 

	
  Name of Underwriter

  	
   

  	
  Number of Initial

  Securities

  	
   

  
	
  Banc of
  America Securities LLC

  	
   

  	
  12,100,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  12,100,000

  	
   

  

 

Sch A-1

 

SCHEDULE B

 

	
   

  	
   

  	
  Number of

  Initial

  Securities to be

  Sold

  	
   

  	
  Maximum

  Number of

  Option Securities

  to be Sold

  	
   

  
	
  Company

  	
   

  	
  12,100,000

  	
   

  	
  1,815,000

  	
   

  

 

Sch B-1

 

SCHEDULE C

 

List of Significant
Subsidiaries

 

	
  Name

  	
   

  	
  Jurisdiction of Incorporation

  	
   

  	
  %

  Ownership

  	
   

  
	
  UTStarcom
  (China) Co., Ltd.

  	
   

  	
  China

  	
   

  	
  100

  	
  %

  
	
  UTStarcom
  Telecom Co., Ltd.

  	
   

  	
  China

  	
   

  	
  100

  	
  %

  
	
  Hangzhou
  Starcom Telecom Co., Ltd.

  	
   

  	
  China

  	
   

  	
  100

  	
  %

  
	
  Universal
  Communication Technology (Hangzhou) Co., Ltd.

  	
   

  	
  China

  	
   

  	
  49

  	
  %

  
	
  UTStarcom
  Hong Kong, Ltd.

  	
   

  	
  Hong Kong

  	
   

  	
  100

  	
  %

  
	
  UTStarcom
  Japan KK

  	
   

  	
  Japan

  	
   

  	
  100

  	
  %

  

 

Sch C-1

 

SCHEDULE D

 

UTSTARCOM, INC.

          
Shares of Common Stock

(Par Value $.00125 Per Share)

 

 

The purchase
price per share for the Securities to be paid by the several Underwriters shall
be $39.25; provided that the purchase price per share for any Option Securities
purchased upon the exercise of the over-allotment option described in
Section 2(b) shall be reduced by an amount per share equal to any
dividends or distributions declared by the Company and payable on the Initial
Securities but not payable on the Option Securities.

 

Sch D-1

 

SCHEDULE E

 

List of Directors and Executive
Officers

 

 

Directors:

 

	
  Hong Liang Lu

  	
  Chairman

  
	
  Ying Wu

  	
  Director

  
	
  Masayoshi Son

  	
  Director

  
	
  Thomas J. Toy

  	
  Director

  
	
  Betsy Atkins

  	
  Director

  
	
  Larry Horner

  	
  Director

  

 

Executive Officers:

 

	
  Hong Liang Lu

  	
  President, Chief Executive Officer and Chairman of the Board

  
	
  Michael Sophie

  	
  Senior Vice President of Finance, Chief Financial Officer and
  Assistant Secretary

  
	
  Ying Wu

  	
  Vice Chairman, Chairman and Chief Executive Officer of China Operations

  
	
  Johnny Chou

  	
  Executive Vice President and President and Chief Operating Officer of
  China Operations

  
	
  Gerald Soloway

  	
  Senior Vice President, Engineering

  
	
  William Huang

  	
  Senior Vice President and Chief Technology
  Officer

  
	
  Howard Kwock

  	
  Vice President, Engineering

  

 

Other:

 

	
  David Robison

  	
   

  

 

Sch E-1

 

EXHIBIT A

 

Form of Opinion of Counsel for
the Company

 

(i)                                     The
Company is validly existing as a corporation in good standing under the laws of
the State of Delaware with corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the Underwriting
Agreement.

 

(ii)                                  The
Company is qualified as a foreign corporation to transact business and is in
good standing in California.

 

(iii)                               The
authorized capital stock of the Company is as set forth in the Prospectus under
the caption “Capitalization” and the Company’s Common Stock conforms as to
legal matters to the description thereof contained in the Prospectus.

 

(iv)                              The
Shares have been duly authorized for issuance and sale to the Underwriters
pursuant to the Underwriting Agreement and, when issued and delivered by the
Company pursuant to the Underwriting Agreement against payment of the
consideration set forth in the Underwriting Agreement, will be validly issued,
fully paid and non-assessable and the issuance of the Shares will not be
subject to any preemptive rights under the Company’s Certificate of Incorporation
or Bylaws, the General Corporation Law of the State of Delaware or, to our
knowledge, any agreement or instrument described in or referred to in the
Registration Statement.

 

(v)                                 The
Underwriting Agreement has been duly authorized, executed and delivered by the
Company.

 

(vi)                              To
our knowledge, and without inquiring into dockets of any court, commission,
regulatory body, administrative agency or other governmental body, and other
than as set forth in, or incorporated by reference into, the Prospectus, in the
United States, there is not pending or threatened any legal or governmental
proceedings to which the Company or any subsidiary is a party, or to which the
property of the Company or any subsidiary is subject, before or brought by any
U.S. court or governmental agency or body, which could reasonably be expected
to materially and adversely affect the consummation of the transactions
contemplated in the Underwriting Agreement or the performance by the Company of
its obligations thereunder.

 

(vii)                           To our
knowledge, no consent, approval, authorization or order of or qualification
with any United States federal, New York State court or California State court,
governmental agency or body is required for the performance by the Company of
its obligations under the Underwriting Agreement, except such consents,
approvals, authorizations, orders or qualifications as have been obtained under
the Securities Act and the Securities Exchange Act of 1934, as amended, and as
may be required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Shares by the Underwriters (as to which we
express no opinion).

 

(viii)                        The
execution, delivery and performance by the Company of the Underwriting
Agreement, the issuance and sale of the Shares pursuant to the Underwriting
Agreement and the performance by the Company of the terms and provisions
thereof will not result in a breach or

 

A-1

 

violation of any of the terms and provisions of, or constitute a
default under, (A) the Certificate of Incorporation or Bylaws of the Company,
(B) to our knowledge, any material U.S. law, statute, rule, regulation or order
customarily applicable to transactions of this nature or any judgment, order, writ
or decree known to us of any governmental agency or body or any court having
jurisdiction over the Company or any of its properties, or (C) any agreement or
instrument to which the Company or its subsidiaries is a party or by which the
Company or its subsidiaries is bound or to which any of the properties of the
Company or its subsidiaries is subject, and which agreement or instrument is
included as an exhibit filed pursuant to Item 601(b)(4) and 601(b)(10) of
Regulation S-K to the Registration Statement, or which is listed on Exhibit A
hereto.

 

(ix)                                Except
as disclosed in the Prospectus, there are no contracts, agreements or
understandings known to us between the Company and any person granting such
person the right to require the Company to include such securities in the
securities registered pursuant to the Registration Statement.

 

(x)                                   The
statements set forth in the Prospectus under the captions “Description of
Common Stock” and “Underwriting” (except for such statements provided in such
section by the Underwriters) insofar as such statements constitute a
summary of matters of legal matters or documents referred to therein, fairly
summarize such information in all material respects.

 

(xi)                                The
Company is not required to be registered as an investment company under the
Investment Company Act of 1940, as amended.

 

(xii)                             Subject
to certain limitations set forth in this opinion, we advise you that, on the
basis of the information we gained in the course of performing the services
referred to above, in our opinion, (a) each of the documents incorporated
by reference in the Prospectus (other than the financial statements and other
financial data contained or incorporated by reference therein or omitted
therefrom, as to which we express no opinion), at the time it was filed with
the Commission, appears on its face to have been appropriately responsive in
all material respects to the requirements of the Securities Exchange Act of
1934, as amended, and the applicable rules and regulations of the Commission
thereunder and (b) each of the Registration Statement and the Prospectus (other
than the financial statements and other financial data contained or
incorporated by reference therein or omitted therefrom, as to which we express
no opinion) appears on its face to be appropriately responsive in all material
respects to the requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder.

 

(xiii)                          We
further advise you that subject to the limitations set forth in this opinion,
on the basis of the information we gained in the course of performing the
services referred to above no facts came to our attention which gave us reason
to believe that (i) the Registration Statement (other than the financial
statements and other financial data contained or incorporated by reference
therein or omitted therefrom, as to which we have not been requested to
comment), as of the date of the Prospectus Supplement, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
(ii) the Prospectus (other than the financial statements and other financial
data contained or incorporated by reference therein or omitted therefrom, as to
which we have not been requested to comment), as of the date of the Prospectus
Supplement or the date hereof, contained or contains an untrue statement of a
material fact or omitted or omits to state a

 

A-2

 

material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.

 

A-3

 

EXHIBIT B

 

Form of Lockup Agreement for
Directors and Executive Officers

 

B-1

 

EXHIBIT C

 

Form of Lockup Agreement for
SOFTBANK America, Inc.

 

C-1

 

 

EXECUTION COPY

CONFIDENTIAL

 

 

UTSTARCOM, INC.

(a Delaware corporation)

12,100,000 Shares of Common
Stock

 

 

AMENDMENT
NO. 1 TO

UNDERWRITING
AGREEMENT

 

 

Dated: January 14, 2004

 

 

 

AMENDMENT
NO. 1 TO

 

UNDERWRITING
AGREEMENT

 

This Amendment
No. 1 (this “Amendment”) to
the Underwriting Agreement dated January 8, 2004 (the “Original Agreement”) by and between UTStarcom, Inc.
(the “Company”) and Banc of America
Securities LLC (the “Representative”
or the “Underwriter”) is made and entered into
as of January 14, 2004 by and between the Company and the Underwriter.

 

WHEREAS, pursuant to the Original Agreement,
the Representative proposed to make a public offering of the Securities as soon
as the Representative deemed advisable;

 

WHEREAS, as of the Closing Time, the
Representative has not made a public offering of the Securities or determined a
public offering price (or method of such determination) for the Securities;

 

WHEREAS, in accordance with the foregoing,
the Company and the Representative wish to amend the Original Agreement (as
amended pursuant to this Amendment, the “Amended Agreement”)
in accordance with this Amendment.

 

NOW, THEREFORE, in consideration of the
premises and the mutual covenants contained herein, and for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto, intending to be legally bound hereby, agree to amend the
Original Agreement as follows:

 

Section 1.
 Definitions.  (a)        Capitalized
terms used but not defined herein shall have the meanings assigned to such
terms in the Original Agreement.  Capitalized
terms defined in the preamble to this Amendment or in the recitals hereto shall
have the meanings assigned to such terms in such preamble or recitals.

 

(b)                                 For purpose of the
Amended Agreement, (i) the term “Final Prospectus”,
to the extent such term is used in the Original Agreement in Section 1, in
paragraph (j) of Section 3 and in paragraphs (b), (c), (d), (e), (f), (g) and
(1) of Section 5, in each case shall be deemed as of, or at, the
Closing Time (but not as of the Bring-down Date or any Date of Delivery) to be
the form of Final Prospectus attached hereto as Exhibit A as
delivered by the Company to the Underwriter on the date hereof, together with
the Basic Prospectus and including the documents that would be incorporated by
reference pursuant to Item 12 of Form S-3 under the 1933 Act therein
if such Final Prospectus were first used to confirm sales of Securities on the
date hereof, and (ii) at all other times (including the Bring-down Date
and any Date of Delivery), the term “Final Prospectus” shall have the meaning
ascribed to such term in the Original Agreement.

 

(c)                                  “Bring-down
Date” shall mean a date to be mutually agreed between the
Underwriter and the Company, provided that
such date (i) shall not be later than the third business day following the
receipt of the notice from the Underwriter specified in Section 7 of this
Amendment and (ii) shall not occur after July 14, 2004.

 

 

Section 2.
 Representations and Warranties.  (a)                         Reference is made to the
following language at the beginning of Section 1 of the Original
Agreement:

 

“The Company
represents and warrants to each Underwriter, as of the Closing Time referred to
in Section 2(c) hereof and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with the Underwriter,
as follows:”

 

The foregoing language shall be deleted from
the Original Agreement and replaced in its entirety with the following
language:

 

“The Company
represents and warrants to the Underwriter, as of the Closing Time referred to
in Section 2(c) hereof, as of the Bring-down Date and as of each Date
of Delivery (if any) referred to in Section 2(b) hereof, and agrees
with the Underwriter, as follows:”

 

(b)                                 Paragraphs (i) and
(ii) of Section 1 shall be deleted from the Original Agreement and
replaced in their entirety as follows:

 

“(i)                               Compliance with Registration Requirements.  The Company meets the requirements for use of Form S-3
under the 1933 Act.  Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with.

 

At the respective times the Registration
Statement, any Rule 462(b) Registration Statement and any
post-effective amendments thereto became effective, at the Closing Time, at January 8,
2004, at the issue date of the Final Prospectus and at the Bring-down Date
(and, if any Option Securities are purchased, at the Date of Delivery), the
Registration Statement, the Rule 462(b) Registration Statement and
amendments and supplements thereto complied and will comply in all material
respects with the requirements of the 1933 Act and 1933 Act Regulations (other
than, at the Closing Time, the omission of pricing-related information) and did
not and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading (other than, at the Closing Time, the omission
of pricing-related information).  Neither
the Final Prospectus nor any amendments or supplements thereto, at the time the
Final Prospectus or any amendments or supplements are issued, at the Closing
Time, at January 8, 2004 and at the Bring-down Date (and, if any Option
Securities are purchased, at the Date of Delivery), included or will include an
untrue statement of a material fact or omitted or will omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (other than, at the
Closing Time, the omission of pricing-related information).  The representations and warranties in this subsection shall
not

 

2

 

apply to statements in or omissions from the
Registration Statement or the Final Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by any
Underwriter through the Representative expressly for use in the Registration
Statement or the Final Prospectus.

 

The prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment thereto,
or to be filed pursuant to Rule 424 under the 1933 Act, complied, or will
comply, when so filed in all material respects with the requirements of the
1933 Act the 1933 Act Regulations and the Final Prospectus to be delivered to
the Underwriters for use in connection with this offering will be identical to
the electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.

 

(ii)                                  Incorporated
Documents.  The documents
incorporated or deemed to be incorporated by reference in the Registration
Statement and Final Prospectus, at the time they were or hereafter are filed
with the Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the “1934 Act Regulations”),
and, when read together with the other information in the Final Prospectus, at
the time of Registration Statement became effective, at the time the Final
Prospectus was issued, at the Closing Time, at January 8, 2004 and at the
Bring-down Date (and, if any Option Securities are purchased, at the Date of
Delivery), did not and will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading.”

 

(c)                                  All other paragraphs
of Section 1 of the Original Agreement, except as aforesaid, shall
otherwise remain unchanged in the Original Agreement.

 

Section 3.  Covenants of the Company.  (a) Paragraph (a) of Section 3
of the Original Agreement is deleted and replaced in its entirety with the
following:

 

“(a)                            Compliance with Securities Regulations and Commission Request.
 The Company, subject to Section 3(b),
will notify the Representative immediately, and confirm the notice in writing, (i) when
any post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Basic Prospectus or any amended Final
Prospectus shall have been filed, (ii) of the receipt of any comments from
the Commission, (iii) of any request by the Commission for any amendment
to the Registration Statement or any amendment or supplement to the Final
Prospectus or any document incorporated by reference therein or for additional
information, and (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement, or of the
suspension of the qualification of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes.  Upon notice from the
Representative of the Representative’s determination of a public offering price
of the Securities (or a method for determining the same) or the Representative’s
first use of the Final Prospectus

 

3

 

after effectiveness in connection with a
public offering or sale of the Securities, the Company will promptly file the
Final Prospectus with the Commission within the time periods specified by Rule 424(b) and
will take such steps as it deems necessary to ascertain promptly whether the
form of Final Prospectus transmitted for filing under Rule 424(b) was
received for filing by the Commission and, in the event that it was not, it
will promptly file such Final Prospectus.  The Final Prospectus filed pursuant to Rule 424(b) shall
reflect the pricing related information and plan of distribution as advised to
the Company by the Representative.  The
Company will make every reasonable effort to prevent the issuance of any stop
order and, if any stop order is issued, to obtain the lifting thereof at the
earliest possible moment.  The Company
has prepared and filed with the Commission the Rule 462(b) Registration
Statement in order for the Underwriters to exercise the over-allotment option
granted to them pursuant to Section 2(b) hereof.”

 

(b)                                 Paragraph (e) of Section 3
of the Original Agreement is deleted and replaced in its entirety with the
following:

 

“(e)                            Continued
Compliance with Securities Laws.  The Company will comply with the 1933 Act and
the 1933 Act Regulations and the 1934 Act and the 1934 Act Regulations so as to
permit the completion of the distribution of the Securities as contemplated in
this Agreement and in the Final Prospectus. If at any time when a prospectus is
required by the 1933 Act to be delivered in connection with sales of the
Securities, any event shall occur or condition shall exist as a result of which
it is necessary, in the opinion of counsel for the Underwriters or for the
Company, to amend the Registration Statement or amend or supplement the Final
Prospectus in order that the Final Prospectus will not include any untrue
statements of a material fact or omit to state a material fact necessary in
order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement the Final Prospectus in order
to comply with the requirements of the 1933 Act or the 1933 Act Regulations,
the Company will promptly prepare and file with the Commission, subject to Section 3(b),
such amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement or the Final Prospectus comply
with such requirements, and the Company will furnish to the Underwriters such
number of copies of such amendment or supplement as the Underwriters may
reasonably request; provided however that the Company may suspend such
obligation to comply with the 1933 Act and the 1933 Act Regulations and the
1934 Act and the 1934 Act Regulations and to prepare and file any such
amendment or supplement for a period not to exceed an aggregate of 45 days in
any 90-day period or an aggregate of 60 days in any 180-day period
if the Board of Directors of the Company, or the Chief Executive Officer or the
Chief Financial Officer of the Company, shall have determined in good faith
that because of valid business reasons (not including avoidance of the Company’s
obligations hereunder), including, without limitation, the acquisition or
divestiture of assets, pending corporate developments and similar events, it is
in the best

 

4

 

interest of the Company to suspend such
obligation, and prior to suspending such obligation the Company provides the
Representative with written notice at least two hours in advance of such
suspension, which notice need not specify the nature of the event giving rise
to such suspension; provided further, however, that the Company may not
suspend such obligation until after February 13, 2004.  The Company agrees to use its reasonable best
efforts to end the suspension period referred to in this Section 3(e) as
promptly as practicable.”

 

(c)                                  Paragraph (j) of Section 3
of the Original Agreement is deleted and replaced in its entirely with the
following:

 

“(j)”                         Restriction
on Sale of Securities.  During
the period from (and including) January 8, 2004 through (and including) April 7,
2004 (the “Lockup Period”), the Company will
not, without the prior written consent of Banc of America Securities LLC, (i) directly
or indirectly, offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer or dispose of any
share of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or file any registration statement under the 1933
Act with respect to any of the foregoing or publicly disclose the intention to
do any of the foregoing, (ii) enter into any swap or any other agreement
or any transaction that transfers, in whole or in part, directly or indirectly,
the economic consequence or ownership of the Common Stock, whether any such
swap or transaction described in clause (i) or (ii) above is to be
settled by delivered of Common Stock or such other securities, in cash or
otherwise.  The foregoing sentence shall
not apply to (A) the Securities to be sold hereunder, (B) any shares
of Common Stock issued by the Company upon the exercise of an option or warrant
or the conversion of security outstanding on the date hereof and referred to in
the Final Prospectus, (C) any shares of Common Stock issued or options to
purchase Common Stock granted pursuant to existing employee benefit plans of
the Company referred to in the Final Prospectus, (D) any shares of Common
Stock issued pursuant to any non-employee director stock plan or dividend
reinvestment plan, (E) any shares of Common Stock or securities
convertible into or exchangeable for Common Stock issued in connection with
acquisitions (by purchase, merger or otherwise) of other entities (or
substantially all of the assets or operations of other entities) if the
recipients of such securities each executes a lockup agreement with Banc of
America Securities LLC in form and substance substantially similar to the
lockup set forth in this Section 3(i), or (F) any filing of any
registration statement on Form S-8 under the 1933 Act.”

 

Section 4.
 Conditions.  (a)                            The Underwriter hereby
waives, as of the date of this Amendment, the conditions contained in (i) the
last sentence of paragraph (a) of Section 5 of the Original Agreement
and (ii) the second sentence of the third paragraph of the Original
Agreement.  The foregoing waivers shall
have no effect on the Company’s obligation, pursuant to the Amended Agreement,
to file the Final Prospectus pursuant to Rule 424(b) of the 1933 Act
Regulations in accordance with the terms of the Amended Agreement.

 

5

 

(b)                                 Paragraphs (f) and
(g) of Section 5 of the Original Agreement are deleted and placed in
their entirety with the following:

 

“(f)                              Accountants’
Comfort Letters.  At January 8,
2004, the Representative shall have received from each of
PricewaterhouseCoopers LLP and Deloitte & Touche LLP a letter dated
such date, in form and substance satisfactory to the Representative, together
with signed or reproduced copies of such letter for each of the other
Underwriters containing statements and information of the type ordinarily
included in accountants’ “comfort letters” to underwriters with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Final Prospectus.

 

(g)                                 Bring-down
Comfort Letters.  At Closing
Time, the Representative shall have received from each of
PricewaterhouseCoopers LLP and Deloitte & Touche LLP a letter, dated
as of Closing Time, to the effect that they reaffirm the statements made in the
letter furnished pursuant to subsection (f) of this Section, except
that the specified date referred to shall be a date not more than three
business days prior to Closing Time.”

 

(c)                                  The following
paragraph shall be inserted at the end of Section 5 of the Original
Agreement as paragraph (l):

 

“Opinion of General Counsel
of the Company.  At Closing
Time, the Representative shall have received the favorable opinion, dated as of
Closing Time, of Russell L. Boltwood, General Counsel of the Company,
substantially in the form attached hereto as Exhibit D.”

 

The form of opinion of Mr. Boltwood referred to in Section 5(l)
of the Amended Agreement is attached to this amendment as Schedule l.

 

Section 5.  Additional Covenants of the Company.  In addition of the covenants in the Original
Agreement, as amended by this Amendment, the Company covenants with the
Underwriter as follows:

 

On the Bring-down Date (provided that the
Bring-down Date occurs on or before July 14, 2004), the representations
and warranties of the Company contained herein and the statements in any
certificates furnished by the Company or any subsidiary of the Company
hereunder shall be true and correct in all material respects as of the
Bring-down Date and, at the Bring-down Date, the Company shall cause the
Representative to receive:

 

(a)                                  Officers’
Certificate.  A certificate,
dated the Bring-down Date, of the President or a Vice President of the Company
and of the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time pursuant to Section 5(e) of
the Original Agreement remains true and correct as of the Bring-down Date.

 

(b)                                 Opinion of
Counsel for the Company.  The
favorable opinion of Shearman & Sterling LLP, counsel for the Company,
dated the Bring-down Date to the same effect as the opinion required by Section 5(b) of
the Original Agreement.

 

6

 

(c)                                  Opinion of
PRC Counsel for the Company.  The favorable opinion of Jun He Law Offices,
PRC counsel for the Company, dated the Bring-down Date to the same effect as
the opinion required by Section 5(c) of the Original Agreement.

 

(d)                                 Opinion of
Counsel for the Underwriters.  The favorable opinion of Davis Polk &
Wardwell, counsel for the Underwriters, dated the Bring-down Date to the same
effect as the opinion required Section 5(d) of the Original
Agreement.

 

(e)                                  Bring-down
Comfort Letter.  A letter form
each of PricewaterhouseCoopers LLP and Deloitte & Touche LLP, in form
and substance satisfactory to the Representative and dated the Bring-down Date,
substantially in the same form and substance as the letter furnished to the
Representative pursuant to Section 5(f) of the Original Agreement,
except that the “specified date” in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to the Bring-down Date.

 

(f)                                    Opinion of General Counsel of the Company.  The favorable opinion, dated the Bring-down
Date, or Russell L. Boltwood, General Counsel of the Company to the same effect
as the opinion required by Section 5(1) of the Original Agreement, as
amended by this Amendment.

 

(g)                                 Additional
Documents.  At the Bring-down
Date, counsel for the Underwriter shall have been furnished with such documents
and opinions as they may require for the purpose of enabling them to pass upon
the issuance and sale of the Securities as contemplated in the Original
Agreement, or in order to evidence the accuracy of any of the representations
or warranties, or the fulfillment of any of the conditions, contained in the
Original Agreement; and all proceedings taken by the Company in connection with
the issuance and sale of the Securities as contemplated in the Original
Agreement shall be satisfactory in form and substance to the Representative and
counsel for the Underwriters.

 

(h)                                 References
to the Final Prospectus.  For
purposes of the certificates, opinions and comfort letters to be provided on
the Bring-down Date, “Final Prospectus”, when such term is used with respect to
the Bring-down Date, shall have the meaning ascribed to such term in Section 1(b)(ii) of
this Amendment.

 

Section 6.  Representations Warranties and Agreements
to Survive Delivery.  All
representations, warranties and agreements contained in this Amendment, the
Original Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto or thereto, shall remain operative and
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter or controlling person, or by or on behalf of the Company,
and shall survive delivery of the Securities to the Underwriter.

 

Section 7.  Representations and Warranties and
Agreements of the Underwriter.  The
Underwriter represents and warrants to the Company that through the date of
this Amendment, neither the Underwriter nor any of its affiliates has made any
offer or sale of the Securities and the offering price in connection with the
Securities has not been determined.  The
Representative covenants with the Company that it will promptly notify the
Company in writing following any offer or sale of the Securities or the
determination of the offering price of the Securities.

 

7

 

Section 8.  Confidentiality.  The Company agrees that (i) this
Amendment and all the information contained therein (together, the “Confidential Information”) will be kept confidential and
shall not be disclosed, in whole or in part, to any person other than to its
counsel, its independent auditors and any party that is required to deliver
documentation in connection with any closing pursuant to the Amended Agreement
(each, a “Company Representative”), (ii) the
Company will require each Company Representative to keep the Confidential Information
confidential and not to disclose the Confidential Information to any person and
(iii) the Company shall be responsible for any breach of Section 8 by
each Company Representative.

 

In the event the Company is requested or
required to disclose any of the Confidential Information, (i) the Company
will provide the Underwriter with prompt notice of such request or requirement,
(ii) the Company will furnish only that portion of the Confidential
Information which is legally required, in the opinion of its counsel, and (iii) the
Company will exercise its reasonable best efforts to obtain a protective order,
confidential treatment or other reliable assurance that confidential treatment
will be accorded such portion of the Confidential Information furnished
pursuant to clause (ii) unless such portion of the Confidential
Information is required, in the opinion of its counsel, to be disclosed to the
public.

 

Section 9.  Governing Law and Time.  THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.  EXCEPT AS OTHERWISE SET FORTH HEREIN,
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.

 

Section 10.  The Headings.  The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.

 

Section 11.  Counterparts.  This Amendment may be executed by any one or
more of the parties hereto in any number of counterparts, each of which shall
be deemed an original, but all such counterparts shall together constitute one
and the same instrument.

 

Section 12.  No Other Agreements.  The parties hereto acknowledge that the
Original Agreement, as amended by this Amendment, represents the sole
understanding and agreement between the parties with respect to the subject
matter hereof and supersedes any prior understandings or agreements that may
have existed.

 

Section 13.  Original Agreement Effectiveness.  Other than the modifications of the Original
Agreement contemplated herein, all other terms and provisions of the Original
Agreement shall remain in full force and effect.

 

8

 

If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the Company, a
counterpart hereof, whereupon this instrument, along with all counterparts,
will become a binding agreement between the Underwriter and the Company in
accordance with its terms.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
  UTSTARCOM, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Michael Sophie

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Michael Sophie

  
	
   

  	
   

  	
  Title:

  	
   Senior Vice President of Finance &

  
	
   

  	
   

  	
   

  	
    Chief Financial Officer

  
						

 

 

	
  CONFIRMED AND ACCEPTED,

  	
   

  	
   

  
	
  as of the date first above written:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  BANC OF AMERICA SECURITIES LLC

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  Paul A. Phillips, Managing Director

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Paul A. Phillips

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  	
   

  	
   

  
						

 

 

Exhibit A

 

[The Final
Prospectus, as defined in Section 1(a)(i) of the Amendment, is
attached hereto as Exhibit A.]Exhibit 10.104

 

[***].  Confidential Treatment Requested – Certain
information in this exhibit has been omitted and filed separately with the
Commission.  Confidential treatment has
been requested with respect to the omitted portions.

 

AGREEMENT

 

December 20th, 2004

 

Curitel Communications, Inc. (hereinafter called “Curitel”)
and UTStarcom Personal Communications LLC (hereinafter called “UTStarcom”)
enter into this Agreement as of December 20th, 2004 according to the
following terms and conditions:

 

1.                                       Exclusivity.

 

1.1                                 Curitel appoints UTStarcom its
exclusive distributor for the sale of Curitel’s [***] terminal products set
forth in the Exhibit A designed, engineered or produced by Curitel in
[***] (the “Territory”).

 

1.2                                 Curitel will not provide any of
its products to [***] for selling them within the UTStarcom’s exclusive
territory.

 

1.3                                 UTStarcom will consider Curitel
as its preferred [***] supplier.

 

2.                                       Product.

 

Product models specified in Exhibit A are Subject
to carrier approval and competitive prices from Curitel.  Product model not specified in Exhibit A
could be sold through UTStarcom provided there is a pre-arranged agreement with
carrier and price, delivery term and other major issues mutually agreed by
Curitel.

 

3.                                       Quantity.

 

3.1                                 UTStarcom shall purchase from
Curitel the total quantity exceeding [***] units subject to (a) the
acceptable performance of product during trial by carriers and their approval
of user interface and to compliance with all technical issues; and (b) competitive
pricing, timely delivery and satisfactory quality.

 

4.                                       Price.

 

4.1                                 The price for terminals on the
attachment is based on one handset, one Standard Battery, one Charger and
Manual.

 

4.2                                 Price by model for 4th Quarter
in Year 2004 is specified in Exhibit A.

 

4.3                                 Prices for 1st Quarter in Year
2005 and thereafter shall be discussed and mutually agreed.

 

 

4.4                                 UTStarcom’s final prices to the
carriers (hereinafter referred to the “Net Prices”) shall be the amount equal
to [***].  All other Net Prices shall be
mutually agreed by both parties.

 

5.                                       Payment
Terms.

 

5.1                                 UTStarcom shall make payment to
Curitel for product model purchased under this Agreement by telegraphic
transfer.  Every first day of the month,
Curitel will send the invoice for that month’s total scheduled shipment and
UTStarcom will make payment of [***] of the invoiced amount on that day.  At the time of every individual shipment,
UTStarcom will also make payment for the [***] of its invoice amount of the
shipped products within (3) days after receiving bill of landing thereof
in US dollars.  Every last day of the
month, the balance of the prepaid [***] amount will be settled in a way that
UTStarcom makes payment for the differences if UTStarcom’s total payments in
that month falls short to the total shipped amount in that month.  Or UTStarcom will deduct the amount from
following month’s [***] amount if there is any over paid amount in the previous
month.

 

6.                                       Forecast
/ Order Placement.

 

6.1                                 UTStarcom will provide Curitel
with [***] firm purchase order and [***] rolling forecast of its estimated
requirements for products.

 

6.2                                 The above purchase order and the
rolling forecast shall be provided by the 10th of each month.

 

6.3                                 UTStarcom will update forecasts
on a monthly basis or more frequently.

 

6.4                                 The purchase order shall be
deemed to be confirmed in case Curitel fails to notify UTStarcom of objection
to such purchase order within 5 business days after receipt of it.

 

6.5                                 Both parties will discuss and
share risk for the long lead and unique components to be ordered by Curitel
before approval of the products from the carriers model by model.  Curitel will provide the unique parts and
long-lead components list.  This list
will include the quantity and the unit price and the total amounts to be
purchased to meet the mass production requirement.

 

6.6                                 Subject to section 3.1,
with respect to any surplus components or finished goods already ordered and/or
manufactured under the purchase orders of UTStarcom and for which Curitel is
liable resulting from cancellation of firm purchase orders, UTStarcom will take
responsibility as long as UTStarcom issued the purchase order.  This responsibility will include the purchase
of above quantity at the price of P/O sheet. 
Curitel, however, will use its best efforts to (1) reduce its
liability to its vendors by canceling orders for surplus components and (2) utilize
such items in manufacturing elsewhere.

 

2

 

7.                                       Delivery.

 

7.1                                 UTStarcom and Curitel will work
together to ensure maximum flexibility in order delivery.  Product model will be shipped at CIP
(IncoTerms 2000) to any port by air or sea freight, at UTStarcom’s option.

 

7.2                                 Curitel will be responsible for
air freight charges in case that Curitel delivers the product after [***] from
agreed delivery date on the confirmed purchase order.

 

7.3                                 In the event delivery is delayed
more than [***] from agreed delivery date on the confirmed purchase order,
UTStarcom will have the option to cancel or revise purchase order for the
delayed product model.

 

8.                                       Marketing.

 

8.1                                 UTStarcom shall provide
marketing information per [***] to Curitel [***].  UTStarcom shall cause Curitel to build up
marketing channel with carriers directly and discuss for all the product
planning related issues.

 

9.                                       [***]

 

10.                                 Fulfillment
Fee.

 

10.1                           Curitel agrees to pay a
fulfillment fee to UTStarcom to be mutually negotiated based on prior fees
charged for the after sales service to be rendered to Curitel’s products sold
in the Territories.

 

10.2                           The fulfillment fee to cover any
and all the expenses, which will occur in connection with UTStarcom’s sales
activity, is included in the Net Prices (Net Price includes fulfillment fee).

 

10.3                           The fulfillment fee is paid only
for the complete set of [***] terminal product, which consists of handset, a
battery and a desktop charger.

 

11.                                 Brand
Name.

 

11.1                           The products purchased by
UTStarcom under this Agreement shall be sold under the co-brand name such as
Audiovox-Pantech, provided, however, that if the carriers do not accept such
co-branding, UTStarcom will make best efforts for such co-brand name to be
displayed on gift boxes, labels or other materials than handsets.

 

3

 

12.                                 Parts
Allowance.

 

12.1                           Curitel shall provide [***]
spare part of the product to UTStarcom in lieu of the warranty service for the
product.  Curitel shall not be
responsible for any other warranty service (except any Epidemic Failure) for
the product other than the supply of [***] spare part set forth in the preceding
sentence.

 

12.2                           Except for the Section 12.1,
Curitel shall quarterly invoice any spare parts provided to UTStarcom in
accordance with market price at that time. 
Curitel will continue to provide spare parts for such warranty service
by UTStarcom after expiration of this Agreement.

 

13.                                 Warranty
Service.

 

13.1                           UTStarcom shall be responsible
for the warranty services with respect to the product except any Epidemic
Failure.  Epidemic Failure shall mean the
situation that would exist if [***] or more of the total units of the Products
delivered to Buyer hereunder during the consecutive [***] period demonstrates a
defect in material workmanship and/or design, or fails to conform to this
specification because of a identical cause except fault or negligence of the
user, or shipper, or improper use of the Product, Curitel’s responsibility for
the Epidemic Failure is effective for [***] after shipment of the
products.  Curitel will be responsible
for all costs and expenses in connection with he Epidemic Failure.

 

13.2                           If Curitel establishes its own
warranty service facilities in UTStarcom’s exclusive territories for its
product after expiration of this Agreement, UTStarcom will cooperate and assist
Curitel in this endeavor, provided Curitel continues to provide spare parts to
UTStarcom.

 

14.                                 Agreement
Term and Termination.

 

14.1                           This Agreement shall be valid
for a period of [***] from the signature of this agreement.

 

14.2                           UTStarcom shall support Curitel
to establish a direct sales operation for its products in the Territory.  Such support shall include, but not limited
to [***].  If UTStarcom fails to do this
or delays to provide such supports, Curitel shall be entitled to claim against UTStarcom.  This will include to make null and void for
the exclusivity above clause 1.

 

14.3                           For the avoidance of doubt,
Curitel shall be entitled to sell or distribute, during the term of this
Agreement, in the Territory any terminals that shall not be specified in Exhibit A
attached hereto and described in Article 2.

 

15.                                 Limitation
of Liability; Governing Law.

 

15.1                           Limitation of Liability. NEITHER PARTY SHALL HAVE ANY
LIABILITY FOR ANY LOSS OF PROFIT OR OTHER COMMERCIAL DAMAGE, INCLUDING, WITHOUT
LIMITATION: INCIDENTAL, CONSEQUENTIAL, INDIRECT, SPECIAL OR PUNITIVE DAMAGES OF
ANY KIND; LOSS OF, OR DAMAGE TO, UTSTARCOM’S OR ANY END USER’S RECORDS OR DATA;
OR LOSS OF REVENUE, 

 

4

 

LOSS OF BUSINESS OR OTHER FINANCIAL LOSS
ARISING OUT OF OR IN CONNECTION WITH ANY PRODUCTS SOLD OR LICENSED BY CURTAIL
TO UTSTARCOM OR TO ANY END USER OF PRODUCTS, EVEN IF CURTAIL HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES.

 

15.2                           WITHOUT LIMITING THE FOREGOING,
EACH PARTY’S TOTAL LIABILITY TO THE OTHER PARTY UNDER THIS AGREEMENT WILL BE
LIMITED TO THE PAYMENTS MADE BY UTSTARCOM UNDER THIS AGREEMENT IN THE  [***] IMMEDIATELY PRECEDING THE EVENT WHICH
GAVE RISE TO SUCH DAMAGES.

 

15.3                           Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws, other than choice of law rules, of the
State of California.  All disputes which
may arise between the parties, out of or in relation to or in connection with
this Agreement shall be finally settled by arbitration in Los Angeles, CA in
accordance with arbitration rules of ICC.

 

	
  Curitel Communications, Inc.

  	
  UTSTARCOM

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
  /s/ Moon Song 

  	
   

  	
  By: 

  	
  /s/ Philip Christopher 

  	
   

  
	
   

  	
  Dr. Moon Song 

  	
   

  	
  Philip Christopher 

  
	
   

  	
  President and CEO

  	
   

  	
  President and CEO UTStarcom 

  
	
   

  	
   

  	
  Personal Communication LLC

  
						

 

5

 

Exhibit A - AudioVox Year 2004 / 2005

 

[***]

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