Document:

Exhibit 10.33

UTSTARCOM, INC.

 

2006 EQUITY INCENTIVE PLAN

 

NOTICE OF GRANT OF PERFORMANCE SHARES

 

Unless otherwise
defined herein, the terms defined in the 2006 Equity Incentive Plan (the “Plan”)
will have the same defined meanings in this Notice of Grant of Performance
Shares (the “Notice of Grant”).

 

Participant:

 

Address:

 

You have been
granted the right to receive Performance Shares, subject to the terms and
conditions of the Plan, this Notice of Grant and the Performance Share Award Agreement
attached hereto as Exhibit A (together, the “Award Agreement”) as
follows:

 

	
  Grant Number

  	
   

  
	
   

  	
   

  
	
  Date of Grant

  	
   

  
	
   

  	
   

  
	
  Target
  Number of Performance Shares

  	
  [                                                  ]

  
	
   

  	
   

  
	
  Performance Period

  	
  [                                                  ]

  
	
   

  	
   

  
	
  Performance
  Matrix 

  	
  The
  number of Performance Shares in which you may vest in accordance with the
  Vesting Schedule below will depend upon achievement [Insert Description of Performance
  Goal(s)] and will be determined in accordance with the Performance Matrix,
  attached hereto as Appendix B. [Insert Performance Target(s)].

  

 

Vesting
Schedule:

 

The Performance
Shares will vest as follows: [Vesting Schedule]

 

In the
event Participant ceases to be a Service Provider for any or no reason before Participant
vests in the Performance Shares, the Performance Shares and Participant’s right
to acquire any Shares hereunder will immediately terminate.

 

By
Participant’s signature and the signature of the Company’s representative
below, Participant and the Company agree that this Award of Performance Shares
is granted under and governed by the terms and conditions of this Award
Agreement and the Plan, which is made a part of this document.

 

	
  PARTICIPANT

  	
   

  	
  UTSTARCOM, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature

  	
   

  	
  By

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Print Name

  	
   

  	
  Title

  

 

 

EXHIBIT A

 

PERFORMANCE SHARE AWARD AGREEMENT

 

1.             Grant.  The Company hereby grants to the Participant
named in the attached Notice of Grant  an Award of Performance Shares, subject to all of the terms and
conditions in this Award Agreement
and the Plan, which is incorporated herein by reference.  Subject to Section 19(c) of the
Plan, in the event of a conflict between the terms and conditions of the Plan
and the terms and conditions of this Award Agreement, the terms and conditions of the Plan will prevail.

 

2.             Company’s Obligation to Pay.  Each Performance Share represents the right
to receive a Share on the date it vests. 
Unless and until the Performance Shares will have vested in the manner
set forth in Section 3, Participant will have no right to payment of any
such Performance Shares.  Prior to actual
payment of any vested Performance Shares, such Performance Share will represent
an unsecured obligation of the Company, payable (if at all) only from the
general assets of the Company.

 

3.             Vesting Schedule.  Subject to Section 5, the Performance
Shares awarded by this Award Agreement will vest in accordance with the vesting
provisions set forth in the Notice of Grant. 
Performance Shares  scheduled
to vest on a certain date or upon the occurrence of a certain condition will
not vest in Participant in accordance with any of the provisions of this Award Agreement, unless Participant will have
been continuously a Service Provider from the Date of Grant until the date such
vesting occurs.

 

4.             Payment
after Vesting.

 

(a)           General Rule.  Subject to Section 7, any Performance
Shares that vest will be paid to Participant (or in the event of Participant’s
death, to his or her properly designated beneficiary or estate) in whole
Shares.  Subject to the provisions of Section 4(b),
such vested Performance Shares shall be paid in whole Shares as soon as
practicable after vesting, but in each such case within the period ending no
later than the later of (i) the end of the calendar year that includes the
vesting date or (ii) the fifteenth (15th) day of the third (3rd) month
following the vesting date.  In no event
will Participant be permitted, directly or indirectly, to specify the taxable
year of payment of any Performance Shares payable under this Award Agreement.

 

(b)           Acceleration.

 

(i)            Discretionary Acceleration.  Notwithstanding anything in the Plan, this
Award Agreement, or any other plan or agreement to the contrary, if the
Administrator, in its discretion, accelerates the vesting of the balance, or
some lesser portion of the balance, of the unvested Performance Shares, such
Performance Shares will be considered as having vested as of the date specified
by the Administrator.  Subject to the
provisions of this Section 4, Section 5 and Section 7, the payment
of such accelerated portion of the Performance Shares shall be made as soon as
practicable after the new vesting date, but, except as provided in this Award
Agreement, in no event later than the later of (i) the end of the calendar
year that includes the vesting date or (ii) the fifteenth (15th) day of
the third (3rd) month following the applicable vesting date; provided, however,
if the Award is “deferred compensation” within the meaning of Section 409A
of the Internal Revenue Code of 1986, as amended, and the final Treasury 

 

 

Regulations and any official
guidance promulgated thereunder (“Section 409A”), the payment of such
accelerated portion of the Performance Shares nevertheless shall be made at the
same time or times as if such Performance Shares had vested in accordance with
the vesting schedule set forth in the Notice of Grant as if the acceleration
had not been applied, including any necessary application of Section 4(b)(ii) (whether
or not Participant remains employed by the Company or a Parent or Subsidiary of
the Company as of such date(s)), unless an earlier payment date, in the
judgment of the Administrator, would not cause Participant to incur an
additional tax under Section 409A, in which case, payment of such
accelerated Performance Shares shall be made no later than the fifteenth (15th)
day of the third (3rd) month (and in all cases within ninety (90) days)
following the earliest permissible payment date that would not cause
Participant to incur an additional tax under Section 409A (subject to Section 4(b)(ii)).  Notwithstanding the foregoing, any delay in
payment pursuant to this Section 4(b)(i) will
cease upon Participant’s death and such payment will be made as soon as
practicable after the date of Participant’s death (and in all cases within
ninety (90) days following such death).

 

(ii)           Separation from Service.  Notwithstanding anything in the Plan, this
Award Agreement, or any other plan or agreement to the contrary, if the vesting
of the balance, or some lesser portion of the balance, of the Performance
Shares is accelerated in connection with Participant’s termination as a Service
Provider, such accelerated Performance Shares will not be payable by virtue of
such acceleration until and unless Participant has a “separation from service”
within the meaning of Section 409A. 
Until Participant has a “separation from service,” the payment of such
accelerated portion of the Award will be made at the same time or times as if
such Award had vested in accordance with the vesting schedule set forth in the
Notice of Grant as if the acceleration had not been applied.  Further, and notwithstanding anything in the
Plan or this Award Agreement to the contrary, if any such accelerated
Performance Shares would otherwise become payable upon a “separation from
service” within the meaning of Section 409A, and if (x) Participant
is a “specified employee” within the meaning of Section 409A at the time
of such “separation from service” (other than due to Participant’s death) and (y) the
payment of such accelerated Performance Shares will result in the imposition of
additional tax under Section 409A if paid to Participant on or within the
six (6) month period following Participant’s “separation from service,”
then, to the extent necessary to avoid the imposition of such additional
taxation, the payment of such accelerated Performance Shares otherwise payable
to Participant during such six (6) month period will accrue and will not
be made until the date six (6) months and one (1) day following the
date of Participant’s “separation from service,” unless Participant dies
following his or her termination as a Service Provider, in which case, the
Performance Shares will be paid in Shares to Participant’s estate as soon as
practicable following his or her death (and in all cases within ninety (90)
days of Participant’s death).

 

(iii)          Change in Control.  Notwithstanding anything in the Plan, this
Award Agreement, or any other plan or agreement to the contrary, if the vesting
of all or a portion of the Performance Shares accelerates (i) pursuant to Section 14(c) of
the Plan in the event of a Change in Control that is not a “change in control”
within the meaning of Section 409A or (ii) pursuant to any other
plan, agreement, resolutions or arrangement that provides for acceleration in
the event of a change in control that is not a “change in control” within the
meaning of Section 409A, then the payment of such accelerated portion of
the Performance Shares will be made in accordance with the timing of payment rules that
apply to discretionary accelerations under Section 4(b)(i) of this
Award Agreement.  If the vesting of all
or a portion of the Performance Shares accelerates in the event of a Change in
Control that is a “change in 

 

 

control”
within the meaning of Section 409A, then the payment of such accelerated
Performance Shares shall be paid no later than the date that is the fifteenth
(15th) day of the third (3rd) month (and in all cases within ninety (90) days)
following the vesting date.

 

(iv)          Section 409A.  It is the intent of this Award
Agreement to comply with the requirements of Section 409A so that none of
the Performance Shares provided under this Award Agreement or Shares issuable
thereunder will be subject to the additional tax imposed under Section 409A,
and any ambiguities herein will be interpreted to so comply.  Each payment and benefit payable under this
Award Agreement is intended to constitute separate payments for purposes of
Treasury Regulation Section 1.409A-2(b)(2).

 

5.             Forfeiture upon Termination of
Status as a Service Provider. 
Notwithstanding any contrary provision of this Award Agreement, the
balance of the Performance Shares that have not vested as of the time of
Participant’s termination as a Service Provider for any or no reason and
Participant’s right to acquire any Shares hereunder will immediately terminate.

 

6.             Death of Participant.  Any distribution or delivery to be
made to Participant under this
Award Agreement will, if Participant is then deceased, be made to Participant’s
designated beneficiary, or if no beneficiary survives Participant, the
administrator or executor of Participant’s estate.  Any such transferee must furnish the Company
with (a) written notice of his or her status as transferee, and (b) evidence
satisfactory to the Company to establish the validity of the transfer and
compliance with any laws or regulations pertaining to said transfer.

 

7.             Withholding of Taxes.  Notwithstanding any contrary provision of
this Award  Agreement, no
certificate representing the Shares will be issued to Participant, unless and
until satisfactory arrangements (as determined by the Administrator) will have
been made by Participant with respect to the payment of income, employment and
other taxes which the Company determines must be withheld with respect to such
Shares.  The Administrator, in its sole
discretion and pursuant to such procedures as it may specify from time to time,
may permit Participant to satisfy such tax withholding obligation, in whole or
in part (without limitation) by (a) paying cash, (b) electing to have
the Company withhold otherwise deliverable Shares having a Fair Market Value
equal to the minimum amount required to be withheld, (c) delivering to the
Company already vested and owned Shares having a Fair Market Value equal to the
amount required to be withheld, or (d) selling a sufficient number of such
Shares otherwise deliverable to Participant through such means as the Company
may determine in its sole discretion (whether through a broker or otherwise)
equal to the amount required to be withheld.  To
the extent determined appropriate by the Company in its discretion, it shall
have the right (but not the obligation) to satisfy any tax withholding
obligations by reducing the number of Shares otherwise deliverable to
Participant.  If Participant fails to
make satisfactory arrangements for the payment of any required tax withholding
obligations hereunder at the time any applicable Performance Shares otherwise
are scheduled to vest pursuant to Sections 3 or 4, Participant will permanently
forfeit such Performance Shares and any right to receive Shares thereunder and
the Performance Shares will be returned to the Company at no cost to the
Company.

 

8.             Rights as Stockholder.  Neither Participant nor any person claiming
under or through Participant will have any of the rights or privileges of a
stockholder of the Company in respect of any Shares deliverable hereunder
unless and until certificates representing such Shares will have been issued,
recorded on the records of the Company or its transfer agents or registrars,
and delivered to Participant.  After such
issuance, recordation and delivery, Participant will have 

 

 

all the rights of a stockholder of the Company
with respect to voting such Shares and receipt of dividends and distributions
on such Shares.

 

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

 

10.           Address for Notices.  Any notice to be given to the Company under
the terms of this Award Agreement will be addressed to the Company at UTStarcom, Inc.,
1275 Harbor Bay Parkway, Suite 100, Alameda, CA 94502, or at such other
address as the Company may hereafter designate in writing.

 

11.           Grant is Not
Transferable.  Except to the limited
extent provided in Section 6, this grant and the rights and privileges
conferred hereby will not be transferred, assigned, pledged or hypothecated in
any way (whether by operation of law or otherwise) and will not be subject to
sale under execution, attachment or similar process.  Upon any attempt to transfer, assign, pledge,
hypothecate or otherwise dispose of this grant, or any right or privilege
conferred hereby, or upon any attempted sale under any execution, attachment or
similar process, this grant and the rights and privileges conferred hereby
immediately will become null and void.

 

12.           Binding Agreement.  Subject to the limitation on the
transferability of this grant contained herein, this Award  Agreement will be binding upon and inure to
the benefit of the heirs, legatees, legal representatives, successors and
assigns of the parties hereto.

 

13.           Additional Conditions to Issuance
of Stock.  If at any time the Company
will determine, in its discretion, that the listing, registration or
qualification of the Shares upon any securities exchange or under any state or
federal law, or the consent or approval of any governmental regulatory
authority is necessary or desirable as a condition to the issuance of Shares to
Participant (or his or her estate), such issuance will not occur unless and
until such listing, registration, qualification, consent or approval will have
been effected or obtained free of any conditions not acceptable to the Company.  Where the Company determines that the
delivery of the payment of any Shares will violate federal securities laws or
other applicable laws, the Company will defer delivery until the earliest date
at which the Company reasonably anticipates that the delivery of Shares will no
longer cause such violation.  The Company
will make all reasonable efforts to meet the requirements of any such state or
federal law or securities exchange and to obtain any such consent or approval
of any such governmental authority.

 

 

14.           Plan Governs.  This Award Agreement is subject to all terms
and provisions of the Plan.  In the event
of a conflict between one or more provisions of this Award Agreement and one or
more provisions of the Plan, the provisions of the Plan will govern.  Capitalized terms used and not defined in
this Award Agreement will have the meaning set forth in the Plan.

 

15.           Administrator
Authority.  The Administrator will
have the power to interpret the Plan and this Award Agreement and to adopt such
rules for the administration, interpretation and application of the Plan
as are consistent therewith and to interpret or revoke any such rules (including,
but not limited to, the determination of whether or not any Performance Shares
have vested).  All actions taken and all interpretations
and determinations made by the Administrator in good faith will be final and
binding upon Participant, the Company and all other interested persons.  No member of the Administrator will be
personally liable for any action, determination or interpretation made in good
faith with respect to the Plan or this Award  Agreement.

 

16.           Electronic Delivery.  The Company may, in its sole discretion,
decide to deliver any documents related to Performance Shares awarded under the
Plan or future Performance Shares that may be awarded under the Plan by
electronic means or request Participant’s consent to participate in the Plan by
electronic means.  Participant hereby
consents to receive such documents by electronic delivery and agrees to
participate in the Plan through any on-line or electronic system established
and maintained by the Company or another third party designated by the Company.

 

17.           Captions.  Captions provided herein are for convenience
only and are not to serve as a basis for interpretation or construction of this
Award Agreement.

 

18.           Agreement Severable.  In the event that any provision in this Award
Agreement will be held invalid
or unenforceable, such provision will be severable from, and such invalidity or
unenforceability will not be construed to have any effect on, the remaining
provisions of this Award Agreement.

 

19.           Modifications to the Agreement.  This Award  Agreement constitutes the entire
understanding of the parties on the subjects covered.  Participant expressly warrants that he or she
is not accepting this Award Agreement
in reliance on any promises, representations, or inducements other than those
contained herein.  Modifications to this
Award Agreement or the Plan can be made only in an express written contract
executed by a duly authorized officer of the Company.  Notwithstanding anything to the contrary in
the Plan or this Award Agreement,
the Company reserves the right to revise this Award Agreement as it deems
necessary or advisable, in its sole discretion and without the consent of
Participant, to comply with Section 409A or to otherwise avoid imposition
of any additional tax or income recognition under Section 409A in
connection to this Award of Performance Shares.

 

20.           Amendment, Suspension or
Termination of the Plan.  By
accepting this Award, Participant expressly warrants that he or she has
received an Award of Performance Shares under the Plan, and has received, read
and understood a description of the Plan. 
Participant understands that the Plan is discretionary in nature and may
be amended, suspended or terminated by the Company at any time.

 

21.           Governing Law.  This Award Agreement shall be governed by the
laws of the State of California, without giving effect to the conflict of law
principles thereof.  For purposes of
litigating any dispute that arises under this Award of Performance Shares or
this Award 

 

 

Agreement,
the parties hereby submit to and consent to the jurisdiction of the State of
California, and agree that such litigation shall
be conducted in the courts of Alameda County, California,
or the federal courts for the United States for the Northern District of
California, and no other courts, where this Award of Performance Shares is made
and/or to be performed.

 

 

APPENDIX B

PERFORMANCE MATRIX

 

[INSERT PERFORMANCE MATRIX]Exhibit 10.34

 

UTSTARCOM, INC.

 

2006 EQUITY INCENTIVE PLAN

 

NOTICE OF GRANT OF PERFORMANCE UNITS

 

Unless otherwise defined
herein, the terms defined in the 2006 Equity Incentive Plan (the “Plan”) will
have the same defined meanings in this Notice of Grant of Performance Units
(the “Notice of Grant”).

 

Participant:

 

Address:

 

You have been granted the
right to receive Performance Units, subject to the terms and conditions of the
Plan, this Notice of Grant and the Performance Unit Award Agreement attached
hereto as Exhibit A (together, the “Award Agreement”) as follows:

 

	
  Date of Grant

  	
   

  
	
   

  	
   

  
	
  Target Number of
  Performance Units

  	
  [                                                                              ]

  
	
   

  	
   

  
	
  Performance
  Period

  	
  [                                                                              ]

  
	
   

  	
   

  
	
  Performance
  Matrix

  	
  The number of
  Performance Units in which you may vest in accordance with the Vesting
  Schedule below will depend upon achievement [Description of Performance
  Goal(s)] and will be determined in accordance with the Performance Matrix,
  attached hereto as Appendix B. [Performance Target(s)].

  

 

Vesting
Schedule:

 

The Performance Units
will vest as follows: [Vesting Schedule]

 

In the event Participant
ceases to be a Service Provider for any or no reason before Participant vests
in the Performance Units, the Performance Units and Participant’s right to
acquire any Shares hereunder will immediately terminate.

 

By Participant’s
signature and the signature of the Company’s representative below, Participant
and the Company agree that this Award of Performance Units is granted under and
governed by the terms and conditions of the Plan and the Award Agreement, both
of which are made a part of this document.

 

 

	
  PARTICIPANT

  	
   

  	
  UTSTARCOM, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature

  	
   

  	
  By

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Print Name

  	
   

  	
  Title

  

 

2

 

EXHIBIT A

 

PERFORMANCE UNIT AWARD AGREEMENT

 

1.             Grant.  The Company hereby grants to the Participant
named in the attached Notice of Grant an Award of Performance Units, subject to
all of the terms and conditions in this Award Agreement and the Plan, which is
incorporated herein by reference. 
Subject to Section 19(c) of the Plan, in the event of a
conflict between the terms and conditions of the Plan and the terms and
conditions of this Award Agreement, the terms and conditions of the Plan will
prevail.

 

2.             Company’s Obligation to Pay.  Each Performance Unit represents the right to
receive a Share on the date it vests. 
Unless and until the Performance Units will have vested in the manner
set forth in Section 3, Participant will have no right to payment of any
such Performance Units.  Prior to actual
payment of any vested Performance Units, such Performance Unit will represent
an unsecured obligation of the Company, payable (if at all) only from the
general assets of the Company.

 

3.             Vesting Schedule.  Subject to Section 5, the Performance
Units awarded by this Award Agreement will vest in accordance with the vesting
provisions set forth in the Notice of Grant. 
Performance Units scheduled to vest on a certain date or upon the
occurrence of a certain condition will not vest in Participant in accordance
with any of the provisions of this Award Agreement, unless Participant will
have been continuously a Service Provider from the Date of Grant until the date
such vesting occurs.

 

4.             Payment after Vesting.

 

(a)           General Rule. 
Subject to Section 7, any Performance Units that vest will be paid
to Participant (or in the event of Participant’s death, to his or her properly
designated beneficiary or estate) in whole Shares.  Subject to the provisions of Section 4(b),
such vested Performance Units shall be paid in whole Shares as soon as
practicable after vesting, but in each such case within the period ending no
later than the later of (i) the end of the calendar year that includes the
vesting date or (ii) the fifteenth (15th) day of the third (3rd) month
following the vesting date.  In no event
will Participant be permitted, directly or indirectly, to specify the taxable year
of payment of any Performance Units payable under this Award Agreement.

 

(b)           Acceleration.

 

(i)    Discretionary Acceleration.  Notwithstanding anything in
the Plan, this Award Agreement, or any other plan or agreement to the contrary,
if the Administrator, in its discretion, accelerates the vesting of the
balance, or some lesser portion of the balance, of the unvested Performance
Units, such Performance Units will be considered as having vested as of the
date specified by the Administrator. 
Subject to the provisions of this Section 4, Section 5 and Section 7,
the payment of such accelerated portion of the Performance Units shall be made
as soon as practicable after the new vesting date, but, except as provided in
this Award Agreement, in no event later than the later of (i) the end of
the calendar year that includes the vesting date or (ii) the fifteenth
(15th) day of the third (3rd) month following the applicable vesting date;
provided, 

 

 

however,
if the Award is “deferred compensation” within the meaning of Section 409A
of the Internal Revenue Code of 1986, as amended, and the final Treasury
Regulations and  any official guidance
promulgated thereunder (“Section 409A”), the payment of such accelerated
portion of the Performance Units nevertheless shall be made at the same time or
times as if such Performance Units had vested in accordance with the vesting
schedule set forth in the Notice of Grant as if the acceleration had not been
applied, including any necessary application of Section 4(b)(ii) (whether
or not Participant remains employed by the Company or a Parent or Subsidiary of
the Company as of such date(s)), unless an earlier payment date, in the
judgment of the Administrator, would not cause Participant to incur an
additional tax under Section 409A, in which case, payment of such
accelerated Performance Units shall be made no later than the fifteenth (15th)
day of the third (3rd) month (and in all cases within ninety (90) days)
following the earliest permissible payment date that would not cause Participant
to incur an additional tax under Section 409A (subject to Section 4(b)(ii)).  Notwithstanding the foregoing, any delay in
payment pursuant to this Section 4(b)(i) will cease upon Participant’s
death and such payment will be made as soon as practicable after the date of
Participant’s death (and in all cases within ninety (90) days following such
death).

 

(ii)   Separation from Service.  Notwithstanding anything in the Plan, this
Award Agreement, or any other plan or agreement to the contrary, if the vesting
of the balance, or some lesser portion of the balance, of the Performance Units
is accelerated in connection with Participant’s termination as a Service
Provider, such accelerated Performance Units will not be payable by virtue of
such acceleration until and unless Participant has a “separation from service”
within the meaning of Section 409A. 
Until Participant has a “separation from service,” the payment of such
accelerated portion of the Award will be made at the same time or times as if
such Award had vested in accordance with the vesting schedule set forth in the
Notice of Grant as if the acceleration had not been applied.  Further, and notwithstanding anything in the
Plan or this Award Agreement to the contrary, if any such accelerated Performance
Units would otherwise become payable upon a “separation from service” within
the meaning of Section 409A, and if (x) Participant is a “specified
employee” within the meaning of Section 409A at the time of such “separation
from service” (other than due to Participant’s death) and (y) the payment
of such accelerated Performance Units will result in the imposition of
additional tax under Section 409A if paid to Participant on or within the
six (6) month period following Participant’s “separation from service,”
then, to the extent necessary to avoid the imposition of such additional
taxation, the payment of such accelerated Performance Units otherwise payable
to Participant during such six (6) month period will accrue and will not
be made until the date six (6) months and one (1) day following the
date of Participant’s “separation from service,” unless Participant dies
following his or her termination as a Service Provider, in which case, the
Performance Units will be paid in Shares to Participant’s estate as soon as
practicable following his or her death (and in all cases within ninety (90)
days of Participant’s death).

 

(iii)  Change in Control.  Notwithstanding anything in the Plan, this
Award Agreement, or any other plan or agreement to the contrary, if the vesting
of all or a portion of the Performance Units accelerates (i) pursuant to Section 14(c) of
the Plan in the event of a Change in Control that is not a “change in control”
within the meaning of Section 409A or (ii) pursuant to any other
plan, agreement, resolutions or arrangement that provides for acceleration in
the event of a change in control that is not a “change in control” within the
meaning of Section 409A, then the payment of such accelerated portion of
the Performance Units will be made in accordance with the 

 

2

 

timing
of payment rules that apply to discretionary accelerations under Section 4(b)(i) of
this Award Agreement.  If the vesting of
all or a portion of the Performance Units accelerates in the event of a Change
in Control that is a “change in control” within the meaning of Section 409A,
then the payment of such accelerated Performance Units shall be paid no later
than the date that is the fifteenth (15th) day of the third (3rd) month (and in
all cases within ninety (90) days) following the vesting date.

 

(c)           Section 409A.  It
is the intent of this Award Agreement to comply with the requirements of Section 409A
so that none of the Performance Units provided under this Award Agreement or
Shares issuable thereunder will be subject to the additional tax imposed under Section 409A,
and any ambiguities herein will be interpreted to so comply.  Each payment and benefit payable under
this Award Agreement is intended to constitute separate payments for purposes
of Treasury Regulation Section 1.409A-2(b)(2).

 

5.             Forfeiture upon Termination of
Status as a Service Provider. 
Notwithstanding any contrary provision of this Award Agreement, the
balance of the Performance Units that have not vested as of the time of
Participant’s termination as a Service Provider for any or no reason and
Participant’s right to acquire any Units hereunder will immediately terminate.

 

6.             Death of Participant.  Any distribution or delivery to be made to
Participant under this Award Agreement will, if Participant is then deceased,
be made to Participant’s designated beneficiary, or if no beneficiary survives
Participant, the administrator or executor of Participant’s estate.  Any such transferee must furnish the Company
with (a) written notice of his or her status as transferee, and (b) evidence
satisfactory to the Company to establish the validity of the transfer and
compliance with any laws or regulations pertaining to said transfer.

 

7.             Withholding of Taxes.  Notwithstanding any contrary provision of
this Award Agreement, no certificate representing the Shares will be issued to
Participant, unless and until satisfactory arrangements (as determined by the
Administrator) will have been made by Participant with respect to the payment
of income, employment and other taxes which the Company determines must be
withheld with respect to such Shares so issuable.  The Administrator, in its sole discretion and
pursuant to such procedures as it may specify from time to time, may permit
Participant to satisfy such tax withholding obligation, in whole or in part
(without limitation) by (a) paying cash, (b) electing to have the
Company withhold otherwise deliverable Shares having a Fair Market Value equal
to the minimum amount required to be withheld, (c) delivering to the
Company already vested and owned Shares having a Fair Market Value equal to the
amount required to be withheld, or (d) selling a sufficient number of such
Shares otherwise deliverable to Participant through such means as the Company
may determine in its sole discretion (whether through a broker or otherwise)
equal to the amount required to be withheld. 
To the extent determined appropriate by the Company in its discretion,
it shall have the right (but not the obligation) to satisfy any tax withholding
obligations by reducing the number of Shares otherwise deliverable to
Participant.  If Participant fails to
make satisfactory arrangements for the payment of any required tax withholding
obligations hereunder at the time any applicable Performance Units otherwise
are scheduled to vest pursuant to Sections 3 or 4, Participant will permanently
forfeit such Performance Units and any right to receive Shares thereunder and
the Performance Units will be returned to the Company at no cost to the
Company.

 

3

 

8.             Rights as Stockholder.  Neither Participant nor any person claiming
under or through Participant will have any of the rights or privileges of a
stockholder of the Company in respect of any Shares deliverable hereunder
unless and until certificates representing such Shares will have been issued,
recorded on the records of the Company or its transfer agents or registrars,
and delivered to Participant.  After such
issuance, recordation and delivery, Participant will have all the rights of a
stockholder of the Company with respect to voting such Shares and receipt of
dividends and distributions on such Shares.

 

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

 

10.           Address for Notices.  Any notice to be given to the Company under
the terms of this Award Agreement will be addressed to the Company at UTStarcom, Inc.,
1275 Harbor Bay Parkway, Suite 100, Alameda, CA 94502, or at such other
address as the Company may hereafter designate in writing.

 

11.           Grant is Not Transferable.  Except to the limited extent provided in Section 6,
this grant and the rights and privileges conferred hereby will not be
transferred, assigned, pledged or hypothecated in any way (whether by operation
of law or otherwise) and will not be subject to sale under execution,
attachment or similar process.  Upon any
attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this
grant, or any right or privilege conferred hereby, or upon any attempted sale
under any execution, attachment or similar process, this grant and the rights
and privileges conferred hereby immediately will become null and void.

 

12.           Binding Agreement.  Subject to the limitation on the
transferability of this grant contained herein, this Award Agreement will be
binding upon and inure to the benefit of the heirs, legatees, legal
representatives, successors and assigns of the parties hereto.

 

13.           Additional Conditions to Issuance
of Stock.  If at any time the Company
will determine, in its discretion, that the listing, registration or
qualification of the Shares upon any securities exchange or under any state or
federal law, or the consent or approval of any governmental regulatory
authority is necessary or desirable as a condition to the issuance of Shares to
Participant (or his or her estate), such issuance will not occur unless and
until such listing, registration, 

 

4

 

qualification, consent or
approval will have been effected or obtained free of any conditions not
acceptable to the Company.  Where the
Company determines that the delivery of the payment of any Units will violate
federal securities laws or other applicable laws, the Company will defer
delivery until the earliest date at which the Company reasonably anticipates
that the delivery of Shares will no longer cause such violation.  The Company will make all reasonable efforts
to meet the requirements of any such state or federal law or securities
exchange and to obtain any such consent or approval of any such governmental
authority.

 

14.           Plan Governs.  This Award Agreement is subject to all terms
and provisions of the Plan.  In the event
of a conflict between one or more provisions of this Award Agreement and one or
more provisions of the Plan, the provisions of the Plan will govern.  Capitalized terms used and not defined in
this Award Agreement will have the meaning set forth in the Plan.

 

15.           Administrator Authority.  The Administrator will have the power to
interpret the Plan and this Award Agreement and to adopt such rules for
the administration, interpretation and application of the Plan as are
consistent therewith and to interpret or revoke any such rules (including,
but not limited to, the determination of whether or not any Performance Units
have vested).  All actions taken and all
interpretations and determinations made by the Administrator in good faith will
be final and binding upon Participant, the Company and all other interested
persons.  No member of the Administrator
will be personally liable for any action, determination or interpretation made
in good faith with respect to the Plan or this Award Agreement.

 

16.           Electronic Delivery.  The Company may, in its sole discretion,
decide to deliver any documents related to Performance Units awarded under the
Plan or future Performance Units that may be awarded under the Plan by electronic
means or request Participant’s consent to participate in the Plan by electronic
means.  Participant hereby consents to
receive such documents by electronic delivery and agrees to participate in the
Plan through any on-line or electronic system established and maintained by the
Company or another third party designated by the Company.

 

17.           Captions.  Captions provided herein are for convenience
only and are not to serve as a basis for interpretation or construction of this
Award Agreement.

 

18.           Agreement Severable.  In the event that any provision in this Award
Agreement will be held invalid or unenforceable, such provision will be
severable from, and such invalidity or unenforceability will not be construed
to have any effect on, the remaining provisions of this Award Agreement.

 

19.           Modifications to the Agreement.  This Award Agreement constitutes the entire
understanding of the parties on the subjects covered.  Participant expressly warrants that he or she
is not accepting this Award Agreement in reliance on any promises,
representations, or inducements other than those contained herein.  Modifications to this Award Agreement or the
Plan can be made only in an express written contract executed by a duly
authorized officer of the Company. 
Notwithstanding anything to the contrary in the Plan or this Award
Agreement, the Company reserves the right to revise this Award Agreement as it
deems necessary or advisable, in its sole discretion and without the consent of
Participant, to comply with Section 409A or to otherwise avoid 

 

5

 

imposition of any
additional tax or income recognition under Section 409A in connection to
this Award of Performance Units.

 

20.           Amendment, Suspension or
Termination of the Plan.  By accepting
this Award, Participant expressly warrants that he or she has received an Award
of Performance Units under the Plan, and has received, read and understood a
description of the Plan.  Participant
understands that the Plan is discretionary in nature and may be amended,
suspended or terminated by the Company at any time.

 

21.           Governing Law.  This Award Agreement shall be governed by the
laws of the State of California, without giving effect to the conflict of law
principles thereof.  For purposes of litigating
any dispute that arises under this Award of Performance Units or this Award
Agreement, the parties hereby submit to and consent to the jurisdiction of the
State of California, and agree that such litigation shall be conducted in the
courts of Alameda County, California, or the federal courts for the United
States for the Northern District of California, and no other courts, where this
Award of Performance Units is made and/or to be performed.

 

6

 

APPENDIX B

PERFORMANCE MATRIX

 

[INSERT PERFORMANCE MATRIX]

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