Document:

Exhibit
10.11

[***].  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.

STRATEGIC
ALLIANCE AGREEMENT

This Strategic Alliance Agreement is entered into as
of September 25, 2006, (the “Effective Date”) by and between Pantech &
Curitel Communications, Inc., a corporation organized and existing under the
laws of the Republic of Korea with its principal place of business at 1451-34,
Seocho-dong, Seocho-gu, Seoul, the Republic of Korea, (hereinafter called
“P&C”) and UTStarcom Personal Communications LLC, a limited liability
company organized and existing under the laws of the States of Delaware with its
principal place of business at 555 Wireless Boulevard, Hauppauge, NY 11778, the
United States of America (“UTStarcom”). P&C and UTStarcom may hereafter be
referred to in this Agreement individually as a “Party” or collectively as the
“Parties.”

1.             Exclusivity.

1.1          P&C
hereby appoints UTStarcom as its exclusive distributor for the sale of
Products, as defined in Article 3.1 below, in North America, Central America
and South America except for Brazil (the “Territory”)..

1.2           Notwithstanding
anything to the contrary in this Article 1, the Parties agree that P&C may
continue to provide CDMA mobile handsets to [***] as well as [***] which are
being sold through [***] and [***]. [***] will not offer any more models other
than described in this agreement as long as this agreement remains effective.

1.3           UTStarcom
will consider P&C as its preferred CDMA supplier.

1.4           UTStarcom
agrees that P&C shall have the right to participate in Product planning discussions
[***], as coordinated by UTStarcom. P&C will provide its representative at
joint product planning meeting held from time to time to cover various Product
planning related issues. The Party will provide the other Party with advance
written notice of any such visits in sufficient time to allow the other Party
to provide representation.

2.             Financial
Contribution.

2.1           [***].

2.2           [***].

2.3           [***].

 1
 

3.                                       Product.

3.1           The
Products shall include [***], including but not limited to [***], and [***] for
the Territory having carrier approval and competitive prices from P&C.

3.2           P&C
shall be entitled to sell or distribute, during the Term, in the Territory any
products that are not Products as defined in Article 3.1 of this
Agreement.  Products defined in Article
3.1 expressly excludes any product operating in accordance with (1) [***] and
(2) [***].

4.                                         Minimum
Volume Guarantee.

4.1           Subject
to 4.2 below, UTStarcom shall purchase from P&C a cumulative total of at
least [***] units during the Term with following periodic minimum volume
targets; (the “Minimum Volume”); provided however, that P&C shall provide a
competitive product roadmap to UTStarcom which is acceptable to UTStarcom.

	
  Period

  	
   

  	
  Volume

  	
   

  
	
  Oct. 1st 2006 ~ Dec. 31st 2007

  	
   

  	
  [***]

  	
   

  
	
  Jan. 1st 2008 ~ Dec. 31st 2008

  	
   

  	
  [***]

  	
   

  
	
  Jan. 1st 2009 ~ Dec. 31st 2009

  	
   

  	
  [***]

  	
   

  

 

4.2           The
Parties further acknowledge that the purchase of the Minimum Volume is subject
to (a) the acceptable performance of the Products during trial by carriers and
carrier final approval; and (b) competitive pricing, timely delivery and satisfactory
quality.  If UTStarcom believes in good
faith that these conditions are not met, UTStarcom shall provide written notice
to P&C with a detailed basis for UTStarcom’s belief, including all
supporting documentation.

4.3           Notwithstanding
the above, the Parties acknowledge that the Minimum Volume is of paramount
importance to the intended strategic alliance and in the event that UTStarcom
fails to reach the periodic Minimum Volume stipulated in Article 4.1 during any
period during the Term, provided all of the conditions of 4.2 above are
successfully complied with, and without prejudice to any other rights P&C
may have, P&C shall be entitled to make null and void the exclusivity
provision in Article 1 above and otherwise embodied this Agreement.

 2
 

5.                                         Price.

5.1           The
price for the Products is based on one handset, one Standard Battery, one
Charger and Manual and the individual price for the product shall be discussed
and mutually agreed on a model by model basis.

6.                                         Payment
Terms.

Except for the payment in Section 16 below, payment
for Products for October, November and December, 2006, shall be as
follows:  [***].

[***].

[***].

7.                                         Forecast
/ Order Placement.

7.1           UTStarcom
will provide P&C with three (3) months firm purchase order and six (6)
months non-binding rolling forecast of its estimated requirements for products.

7.2           The
above firm purchase order and the non-binding rolling forecast shall be
provided by the 10th of each month.

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

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

7.5           UTStarcom
shall pay for any components purchased by P&C and any products in process
as well as finished goods to fulfill the requirements of firm purchase orders
placed by UTStarcom as stated in Section 7.1 above. For such components,
UTStarcom shall, in its sole discretion, either (i) compensate based on the
P&C’s purchase prices of the components, or (ii) ask P&C to complete
them to be delivered to UTStarcom.  P&C, however, will use its best
efforts to (1) reduce such purchased components by canceling orders and (2)
utilize such items in manufacturing elsewhere.

 3
 

8.                                         Delivery.

8.1           UTStarcom
and P&C 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.

8.2           P&C
will be responsible for air freight charges in case that P&C delivers the
product after thirty (30) days from agreed delivery date on the confirmed
purchase order.

8.3           In
the event delivery is delayed more than forty five (45) days 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.

9.                                         Marketing.

UTStarcom shall provide marketing information per each
carrier to P&C every quarter. UTStarcom shall cause P&C to build up
marketing channel with carriers directly and discuss for the entire product
planning related issues.

 4
 

10.                                  Development
Fee.

If P&C and UTStarcom
enter into a future written agreement to jointly develop a Product at
UTStarcom’s initiation for distribution under this Agreement, and UTStarcom
terminates the Product development due to causes not directly related to
P&C’s performance, UTStarcom shall be obligated for expenses actually
incurred by P&C in reasonable reliance on UTStarcom’s representations.

11.                                  Patent
Protection/Indemnification.

11.1         P&C shall indemnify and hold
UTStarcom harmless with respect to all liability, claims and expenses
(including reasonable legal fees) incurred in connection with any action for
any infringement, or claim of infringement, of any third party’s proprietary
rights, patents, trade secrets, trademark or copyright (“Claims”) by the
Products only where UTStarcom provides timely notice of such Claims.  Pursuant to this Article and in its own
discrestion, P&C may compensate UTStarcom to defend against the Claims or
independently defend the Products agains such Claims.  The obligation to indemnify UTStarcom shall
exclude any misuse or modification of P&C’s proprietary rights, patents, or
Products, and shall also exclude any claim based upon UTStarcom’s willful
infringement.

11.2         P&C agrees to defend, indemnify and
hold UTStarcom harmless for any claims, actions, lawsuits, or damages
(including reasonable attorneys’ fees) resulting from breach of the warranties
contained in this Agreement, only where UTStarcom provides timely notice of
such breach of warranty.

12.                                  Left
blank intentionally.

13.                                  Brand
Name.

The brand name of the Products purchased by UTStarcom
under this Agreement [***].

14.                                  Parts
Allowance.

14.1         P&C
shall provide [***] spare part of the product to UTStarcom in lieu of the
warranty service for the product. 
P&C 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. In the event the return rate of defective
Product exceeds [***] of purchases, then UTStarcom shall receive additional
parts necessary to provide to carriers, at no cost, if UTStarcom provides
P&C detailed itemized

 5
 

information on the returned products, including but
not limited to, failed part numbers and symptoms of failure.  Defective rate means the number of defective
products (as measured by Product returned as defective under warranty or
repaired by authorized service personnel) in any month divided by the average
number of units shipped on a monthly basis during the previous [***].  UTStarcom shall submit to P&C detailed
information of defective Product in a monthly report.

14.2         Except
for Article 14.1, P&C shall invoice, on a quarterly basis, any spare parts
provided to UTStarcom in accordance with market price at that time. P&C
will continue to provide spare parts for such warranty service by UTStarcom
after expiration of this Agreement.

14.3        P&C will provide [***] of purchases
at no charge to UTStarcom for its carrier customers field replacement units
(FRU), handset only from the models to be launched from 2007.

15.           Warranty.

15.1         P&C warrants that upon shipment to
UTStarcom the Products are free from defects in material, workmanship and
design under normal use and service and shall otherwise conform to the
specifications, which shall be agreed by the Parties.

15.2         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 [***] percent or
more of the total units of the Products delivered to Buyer with the same
production date code hereunder during the consecutive 2 months 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. P&C’s
responsibility for the Epidemic Failure is effective for [***] after shipment
of the products.  P&C will be responsible
for all costs and expenses in connection with the Epidemic Failure.

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

15.4         P&C
also warrants that (in addition to those warranties implied by law) the Product
together with the packaging, labeling and other material supplied by P&C

 6
 

shall (a) be free from defects caused by any reason,
including but not limited to defects in the design, assembly or manufacture of
the Products; (b) comply with the laws, rules, orders and regulations or
applicable government authorities, including but not limited to all US laws and
regulations affecting handsets; and (c) not infringe on any third parties’
proprietary rights, patents, trademarks or copyrights.

15.5         P&C
will support UTStarcom and its carrier customers in performing warranty
services on the Products by providing reasonable technical assistance,
engineering support, training, service manuals, software, quality control,
Interface testing, software upgrading equipment and schematics.

15.6         UTStarcom
shall inspect and reject any defective Products within fifteen (15) days after
the date of receipt of shipment to determine if they are dead on arrival
(“DOA”).  For those Products founds to be
DOA, P&C will replace with a brand new Product. Product found to be DOA must
include the box and all accessories that were originally included with the
Products. With respect to Product sold to carriers, if the Product is found to
be defective within 30 days of sale to end-user, such Product shall be returned
to P&C for replacement with new Product or credit.

16.                                  Inventory
Purchase.

16.1         UTStarcom
agrees to issue [***] firm purchase orders to P&C for the entire
inventories listed below with delivery dates in [***] and [***].  Details of purchase price and shipment
schedule are set forth in Attachment A, attached hereto and made a part
hereof.  The total Purchase price for
Products listed below shall be [***] net paid to the account designated by
P&C by the end of business hours of September 28th, 2006 in Korean time.

	
  

  	
   

  	
  Volume

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Model

  	
   

  	
  September

  	
   

  	
  October

  	
   

  	
  FOB

  	
   

  	
  MDF

  	
   

  
	
  CDM-8920SP

  	
   

  	
  [***] units

  	
   

  	
  [***] units

  	
   

  	
  [***]

  	
   

  	
   

  	
   

  
	
  CDM-8940VW
  (shipped)

  	
   

  	
  [***] units

  	
   

  	
   

  	
   

  	
  [***]

  	
   

  	
   

  	
   

  
	
  CDM-8940VW(stored
  in P&C)

  	
   

  	
  [***] units

  	
   

  	
   

  	
   

  	
  [***]

  	
   

  	
   

  	
   

  
	
  CDM-180VW

  	
   

  	
  [***] units

  	
   

  	
   

  	
   

  	
  [***]

  	
   

  	
   

  	
   

  
	
  CDM-8945VW

  	
   

  	
  [***] units

  	
   

  	
  [***] units

  	
   

  	
  [***]

  	
   

  	
   

  	
   

  
	
  PC-5740VW

  	
   

  	
   

  	
   

  	
  [***] units

  	
   

  	
  [***]

  	
   

  	
   

  	
   

  

 

 7
 

16.2         Once
the purchase is made for the entire inventories with the above prices, other
than the indemnification and warranty obligations in Sections 11 and 15 above,
P&C shall not have any additional responsibility whatsoever for the
inventories and UTStarcom shall not ask for additional discount or MDF from
P&C.

16.3         For
whatever reason, if P&C fails to deliver the entire inventories stipulated
in Article 16.1 by the end of October, P&C shall promptly refund the amount
equivalent to the value of then-not-delivered inventories to UTStarcom.

17.                                  Non-Circumvention.

17.1        Except
as otherwise provided herein, Pantech Wireless Inc. (“PWI”), and its
affiliates, subsidiaries and related companies shall not directly or indirectly
engage and solicit any CDMA Carriers defined in Article 17.2 within the
Territory with regard to the sales of the Products as long as the exclusivity
granted in Article 1 remains effective.

17.2        Under
this Agreement, CDMA Carriers shall mean network operators, resellers and MVNOs
based on CDMA whose definition is provided in Article 3.

18.                                  PWI
Current Inventory Sales

Both Parties agree to engage in good faith discussion
on the products handled by PWI in a separate agreement.  However, PWI shall not add any new models to
their current product line for sales. Until separate agreement is entered, PWI
will continue to sell the current inventory Product in the territory despite of
Article 1.

19.                                  Agreement
Term and Termination.

19.1         This
Agreement shall be effective from the Effective Date of this Agreement, and
shall continue in full force and effect for a period of Three (3) years or
until terminated in accordance with the terms hereof (the “Term”). In the event
UTStarcom fulfills its minimum purchase requirements, this Agreement may be
renewed for an additional period of 1 year by the mutual agreement of the
Parties.

19.2        Either Party shall have the right to
terminate this Agreement at any time by giving written notice to the other
Party if the other Party breaches any material provision of this Agreement, and
if curable, fails to cure such breach within thirty (30) days after receiving a
written notice to cure such breach.

 8
 

19.3        In addition to all other rights or
remedies provided in this Agreement or by law, either Party shall have the
right to immediately terminate this Agreement if:  (1) the other Party becomes insolvent or
makes a general assignment for the benefit of creditors; (2) the other Party
admits in writing the inability to pay debts as they mature; (3) Any court (or
similar body of law) appoints a trustee or receiver with respect to the other
Party or any substantial part of the other Party’s assets; or (4) An action is
taken by or against the other Party under any bankruptcy or insolvency laws or
laws relating to the relief of debtors.

20.          Limitation
of Liability; Governing Law.

20.1        Limitation
of Liability. WITH THE EXCEPTION OF THE INDEMNITIES IN ARTICLE 11, NEITHER
PARTY SHALL HAVE ANY LIABILITY FOR ANY LOSS OF PROFIT OR 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,
LOSS OF BUSINESS OR OTHER FINANCIAL LOSS ARISING OUT OF OR IN CONNECTION WITH
ANY PRODUCTS SOLD OR LICENSED BY P&C TO UTSTARCOM OR TO ANY END USER OF
PRODUCTS, EVEN IF EITHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.

20.2        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 TWELVE (12) MONTHS IMMEDIATELY PRECEDING THE EVENT WHICH GAVE
RISE TO SUCH DAMAGES.

20.3        Governing
Law.  This Agreement shall be
governed by and construed in accordance with the substantive 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 procedural
arbitration rules of ICC. The Parties hereto specifically consent to the
jurisdiction and venue of the State of California with respect to any
adjudication of any dispute between the Parties hereto, and the enforcement of
any award or judgment against either of the Parties hereto resulting from such
dispute.

21.          P&C
shall ensure that the Products comply at all times with any and all United
States federal, state and municipal statutes, laws, codes and regulations
including any

 9
 

Federal Communications Commission (“FCC”) regulations
and any other governmental requirements of the countries in which UTStarcom
sells and distributes the Products, that may apply to the content, composition,
packaging, labeling, shipment and operation of the Products.

22.          Miscellaneous

22.1         If
any term of this Agreement is declared invalid or unenforceable by a court of
competent jurisdiction, such term shall be deemed deleted therefrom and the
remaining terms shall continue in full force and effect.

22.2       Each Party relies on the other Party’s
experience, knowledge and reputation as an inducement to enter this Agreement
and agrees not to assign or transfer this Agreement without the prior written
consent of the other Party, which shall not be withheld unreasonably.

22.3         This Agreement contains the entire
understanding between the Parties and supersedes any prior agreements, written
or oral, relating to this subject.

22.4         Any required notices hereunder shall be
given in writing at the address of each Party set forth above, or in such other
manner contemplated herein, and shall be deemed served when delivered or, if
delivery is not accomplished by reason or some fault of the addressee, when
tendered.

22.5         In all matters relating to this
Agreement, UTStarcom and P&C shall act as independent contractors.  Except as may be otherwise expressly
permitted hereunder, neither Party will represent that it has any authority to
assume or create any obligation, expressed or implied, on behalf of the other
Party, or to represent the other Party as agent, employee, or in any other
capacity.  Neither Party shall have any
obligation, expressed or implied, except as expressly set forth herein.

22.6         Upon termination of this Agreement,
neither Party shall be discharged from any antecedent obligations or liabilities
to the other Party under this Agreement.

22.7         Sections
11, 15, 20, 21 and 22 shall survive termination or expiration of this Agreement
for any reason.

IN WITNESS WHEREOF, P&C and UTStarcom executed
this Agreement as of the date first above written.

 10
 

 

	
  

  	
  Pantech
  & Curitel

  	
  UTStarcom
  Personal

  
	
   

  	
  Communications,
  Inc.

  	
  Communications LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Sung Kyu Lee

  	
   

  	
  By:

  	
  /s/ Philip Cristopher

  	
   

  
	
   

  	
  Name: Mr. Sung
  Kyu Lee

  	
  Name: Mr. Philip Christopher

  
	
   

  	
  Title: President
  and CEO

  	
  Title: President and CEO, UTStarcom

  Personal Communications

  
							

 

ATTACHMENT
A

UTSTARCOM
PCD

PANTECH
- CURITEL

PROPOSED
PURCHASES

SEPTEMBER
- OCTOBER ‘06

 

	
   

  	
   

  	
   

  	
   

  	
  SEPTEMBER

  	
   

  	
   

  	
   

  	
  OCTOBER

  	
   

  	
   

  	
   

  
	
  MODEL

  	
   

  	
  FOB

  	
   

  	
  QTY

  	
   

  	
  VALUE

  	
   

  	
  QTY

  	
   

  	
  VALUE

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CDM8920SP

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  CDM8940VW

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  CDM180VW

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  CDM8945VW

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  PC5740VW

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  

 

	
  

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  
	
  MODEL

  	
   

  	
  QTY

  	
   

  	
  VALUE

  	
   

  
	
  CDM8920SP

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  CDM8940VW

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  CDM180VW

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  CDM8945VW

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  PC5740VW

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  

 

 

 11EXHIBIT 10.12

UTSTARCOM, INC.

VICE PRESIDENT CHANGE IN
CONTROL AND 

INVOLUNTARY TERMINATION SEVERANCE PAY PLAN

 

1.             Introduction.  The purpose of this UTStarcom, Inc. Vice
President Change in Control and Involuntary Termination Severance Pay Plan (the
“Plan”) is to provide assurances of specified severance benefits to eligible
employees of the Company whose employment is subject to being involuntarily
terminated (other than for Cause, death or Disability).  The Plan is intended to (a) assure that
the Company will have continued dedication and objectivity of its employees,
and (b) provide the Company’s employees with an incentive to continue
their employment and to motivate its employees to maximize the value of the
Company for the benefit of its stockholders.  This Plan is an “employee welfare benefit
plan,” as defined in Section 3(1) of the Employee Retirement Income Security
Act of 1974, as amended.  This document
constitutes both the written instrument under which the Plan is maintained and
the required summary plan description for the Plan.

2.             Important Terms.  To help you understand how this Plan works,
it is important to know the following terms:

2.1           “Administrator” means the Company, acting
through its Vice President of Human Resources or any person to whom the
Administrator has delegated any authority or responsibility pursuant to Section
8, but only to the extent of such delegation.

2.2           “Base Pay” means a Covered Employee’s
regular straight-time salary as in effect during the last regularly scheduled
payroll period immediately preceding the date on which the Severance Benefit
becomes payable.  Base Pay does not
include payments for overtime, shift premium, incentive compensation, incentive
payments, bonuses, commissions or other compensation.

2.3           “Board” means the Board of Directors of the
Company.

2.4           “Cause” means (a) any act of personal
dishonesty taken by the Covered Employee in connection with his or her
responsibilities as an employee which is intended to result in substantial
personal enrichment of the Covered Employee, (b) a Covered Employee’s
conviction of a felony which the Board reasonably believes has had or will have
a material detrimental effect on the Company’s reputation or business, (c) a
willful act by the Covered Employee which constitutes misconduct and is
injurious to the Company, and (d) continued willful violations by the Covered
Employee of the Covered Employee’s obligations to the Company after there has
been delivered to the Covered Employee a written demand for performance from
the Company which describes the basis for the Company’s belief that the Covered
Employee has not substantially performed his or her duties.

2.5           “Change in Control” shall mean the
occurrence of any of the following events:

(a)           Any “person” (as
such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial
owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly,
of securities of the Company representing fifty percent (50%) or more of the
total voting power represented by the Company’s then outstanding voting
securities; or

(b)           The consummation of
the sale or disposition by the Company of all or substantially all of the
Company’s assets; or

(c)           The consummation of
a merger or consolidation of the Company, with any other corporation, other
than a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities
of the surviving entity or its parent) at least fifty percent (50%) of the
total voting power represented by the voting securities  of the Company, or such surviving entity or
its parent outstanding immediately after such merger or consolidation; or

(d)           A change in the
composition of the Board, as a result of which fewer than a majority of the
Directors are Incumbent Directors.  “Incumbent
Directors” means Directors who either (A) are Directors as of the effective
date of the Plan (pursuant to Section 22), or (B) are elected, or nominated for
election, to the Board with the affirmative votes of at least a majority of
those Directors whose election or nomination was not in connection with any
transaction described in subsections (i), (ii) or (iii) or in connection with
an actual or threatened proxy contest relating to the election of Directors.

2.6           “Company” means UTStarcom, Inc., a Delaware
corporation, and any successor by merger, acquisition, consolidation or
otherwise that assumes the obligations of the Company under the Plan.

2.7           “Covered Employee” means an employee of the
Company who is identified on Exhibit A to this Plan or who is designated by the
Administrator in writing from time to time as a Covered Employee.

2.8           “Determination  Period” means the time period beginning on the date of the
Change in Control and ending eighteen (18) months following the Change in
Control.

2.9           “Director” means a member of the Company’s
Board of Directors.

2.10         “Disability” means that the Covered Employee
has been unable to perform his or her Company duties as the result of his or
her incapacity due to physical or mental illness, and such inability, at least
twenty-six (26) weeks after its commencement or one hundred eighty (180) days
in any consecutive twelve (12) month period, is determined to be total and
permanent by a physician selected by the Company or its insurers and acceptable
to the Covered Employee or the Covered Employee’s legal representative (such
agreement as to acceptability not to be unreasonably withheld).  Termination resulting from Disability may
only be effected after at least thirty (30) days’ written notice by the Company
of its intention to terminate the Covered Employee’s employment.  In the event that the Covered Employee
resumes the performance of substantially all of his or her duties 

 2
 

hereunder before the termination of his or her employment becomes
effective, the notice of intent to terminate will automatically be deemed to
have been revoked.

2.11         “Effective  Date”
means June 20, 2006.

2.12         “ERISA” means the Employee Retirement Income
Security Act of 1974, as amended.

2.13         “Good  Reason”
means (a) without the Covered Employee’s express written consent, a significant
reduction of the Covered Employee’s duties, position or responsibilities
relative to the Covered Employee’s duties, position or responsibilities in
effect immediately prior to such reduction, or the removal of the Covered
Employee from such position, duties and responsibilities, unless the Covered
Employee is provided with comparable duties, position and responsibilities;
provided, however, that a reduction in duties, position or responsibilities
solely by virtue of the Company being acquired and made part of a larger entity
shall not constitute a “Good Reason”; (b) without the Covered Employee’s
express written consent, a substantial reduction, without good business
reasons, of the facilities and perquisites (including office space and
location) available to the Covered Employee immediately prior to such
reduction; (c) a reduction by the Company of the Covered Employee’s base salary
as in effect immediately prior to such reduction; (d) a material reduction by
the Company in the kind or level of employee benefits to which the Covered
Employee is entitled immediately prior to such reduction with the result that
the Covered Employee’s overall benefits package is significantly reduced; or
(e) without the Covered Employee’s express written consent, the relocation of
the Covered Employee to a facility or location more than fifty (50) miles from
his or her current location.

2.14         “Involuntary  Termination” means a termination of employment of a Covered
Employee under the circumstances described in Section 4.1 or Section 4.2.

2.15         “Option” means a right granted pursuant to
the Company’s stock option plan(s) to purchase common stock of the Company
pursuant to the terms and conditions of such plan(s).

2.16         “Plan” means the UTStarcom, Inc. Vice
President Change in Control and Involuntary Termination Severance Pay Plan, as
set forth in this document, and as hereafter amended from time to time.

2.17         “Severance  Benefit”
means the compensation and other benefits the Covered Employee will be provided
pursuant to Section 4.

2.18         “Severance  Date”
means the date on which a Covered Employee experiences an Involuntary
Termination.

3.             Eligibility for Severance
Benefit.  An individual is
eligible for the Severance Benefit under the Plan, in the amount set forth in
Section 4, only if he or she is a Covered Employee on the date he or she
experiences an Involuntary Termination and executes, and does not revoke, a
release in favor of the Company as required by Section 4.4.

 3
 

4.             Severance Benefit.

4.1           Involuntary Termination Apart From a Change in Control.  If at any time before a Change in Control or
after the Determination Period following a Change in Control, the Company (or
any parent or subsidiary of the Company) terminates a Covered Employee’s
employment for other than Cause, death or Disability, or the Covered Employee
terminates his or her employment with the Company for Good Reason, then,
subject to the Covered Employee’s compliance with Section 4.4, the Covered
Employee shall receive the following Severance Benefit from the Company:

4.1.1        Severance Benefit.  Each Covered Employee shall be entitled to
receive a lump sum cash payment equal to two (2) weeks of Base Pay for each
year of service with the Company, with a minimum payment equal to six (6)
months of Base Pay, payable within thirty (30) days following the Involuntary
Termination.

4.1.2        Continued Benefits.  The Company shall pay the premiums for the
continued coverage of each Covered Employee (and any eligible dependents) under
the Company’s medical, dental and vision plans at the same level of coverage in
effect on the Severance Date until the earlier of (a) six (6) months (provided
the Covered Employee validly elects to continue coverage under the Consolidated
Omnibus Budget Reconciliation Act (“COBRA”)), or (b) the date upon which the
Covered Employee and the Covered Employee’s eligible dependents become covered
under similar plans.

4.1.3        Accelerated Vesting of Equity Awards.  Each Covered Employee shall not receive any
accelerated vesting on his or her outstanding and unvested equity compensation
awards.  The period over which each
Covered Employee shall be permitted to exercise his or her vested equity awards
(including awards that vest as a result of the Plan) shall be as follows: (a)
with respect to equity compensation awards outstanding as of the Effective
Date, or if later, the date a Covered Employee becomes a participant in the
Plan, such awards shall remain exercisable until the latest of (i) the
fifteenth (15th) day of the third month following the date at which any such
equity award would have otherwise terminated, (ii) December 31 of the year
during which any such equity award would have otherwise terminated, or (iii)
such longer period of time (not to exceed twelve (12) months from the date of
termination) that would be permissible under Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”) and any temporary, proposed or
final Treasury Regulations and guidance promulgated thereunder so that the
extension of the post-termination exercise period would not be considered a
modification (as determined under Section 409A of the Code) of such equity
awards; and (b) with respect to equity awards granted to the Covered Employee
after the Effective Date, or if later, the date a Covered Employee becomes a
participant in the Plan,  such awards
shall remain exercisable for twelve (12) months from the date of termination.

4.2           Involuntary Termination Following a Change in Control.  If at any time within the Determination
Period following a Change in Control, the Company (or any parent or subsidiary
of the Company) terminates a Covered Employee’s employment for other than
Cause, death or Disability, or the Covered Employee terminates his or her
employment with the Company 

 4
 

for Good
Reason, then, subject to the Covered Employee’s compliance with Section 4.4,
the Covered Employee shall receive the following Severance Benefit from the
Company:

4.2.1        Severance Benefit.  Each Covered Employee shall be entitled to
receive a lump sum cash payment equal to (a) one (1) year of Base Pay and (b)
one hundred percent (100%) of his or her target bonus for the year of the
Involuntary Termination, payable within thirty (30) days following the
Involuntary Termination.

4.2.2        Continued Benefits.  The Company shall pay the premiums for the
continued coverage of each Covered Employee (and any eligible dependents) under
the Company’s medical, dental and vision plans at the same level of coverage in
effect on the Severance Date until the earlier of (a) twelve (12) months
(provided the Covered Employee validly elects to continue coverage under
COBRA), or (b) the date upon which the Covered Employee and the Covered
Employee’s eligible dependents become covered under similar plans

4.2.3        Accelerated Vesting of Equity Awards.  Each Covered Employee shall fully vest in
and, if applicable, have the right to exercise, all of his or her outstanding
and unvested equity compensation awards. 
The period over which each Covered Employee shall be permitted to
exercise his or her vested equity awards (including awards that vest as a
result of the Plan) shall be as follows: (a) with respect to equity
compensation awards outstanding as of the Effective Date, or if later, the date
a Covered Employee becomes a participant in the Plan, such awards shall remain
exercisable until the latest of (i) the fifteenth (15th) day of the third month
following the date at which any such equity award would have otherwise
terminated, (ii) December 31 of the year during which any such equity award
would have otherwise terminated, or (iii) such longer period of time (not to
exceed twelve (12) months from the date of termination) that would be
permissible under Section 409A of the Code and any temporary, proposed or final
Treasury Regulations and guidance promulgated thereunder so that the extension
of the post-termination exercise period would not be considered a modification
(as determined under Section 409A of the Code) of such equity awards; and (b)
with respect to equity awards granted to the Covered Employee after the
Effective Date, or if later, the date a Covered Employee becomes a participant
in the Plan, such awards shall remain exercisable for twelve (12) months from
the date of termination.

4.3           Parachute  Payments.  In the event that the severance and other
benefits provided for in this Plan or otherwise payable or provided to the
Covered Employee (i) constitute “parachute payments” within the meaning of
Section 280G of the Code and (ii) but for this Section 4.3, would be subject to
the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the
Employee’s severance benefits hereunder Section 4 shall be either

(a)           delivered in full,
or

(b)           delivered as to such
lesser extent which would result in no portion of such severance benefits being
subject to the Excise Tax,

whichever of the
foregoing amounts, taking into account the applicable federal, state and local
income taxes and the Excise Tax, results in the receipt by the Covered Employee
on an after-tax basis of the greatest amount of severance benefits,
notwithstanding that all or some portion of such 

 5
 

severance benefits may be
taxable under Section 4999 of the Code. 
Unless the Company and the Covered Employee otherwise agree in writing,
any determination required under this Section 4.3 shall be made in writing in
good faith by the accounting firm serving as the Company’s independent public accountants
immediately prior to the Change of Control (the “Accountants”).  In the event of a reduction in benefits
hereunder, the Covered Employee shall be given the choice of which benefits to
reduce.  For purposes of making the
calculations required by this Section 4.3, the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on
reasonable, good faith interpretations concerning the application of Sections
280G and 4999 of the Code.  The Company
and the Covered Employee shall furnish to the Accountants such information and
documents as the Accountants may reasonably request in order to make a
determination under this Section.  The
Company shall bear all costs the Accountants may reasonably incur in connection
with any calculations contemplated by this Section 4.3.

4.4           Release and Non-Disparagement Agreement.  As a condition to receiving Severance
Benefits under this Plan, each Covered Employee will be required to sign a
waiver and release of all claims arising out of his or her Involuntary
Termination and employment with the Company and its subsidiaries and affiliates
and an agreement not to disparage the Company, its directors, or its executive
officers, in a form reasonably satisfactory to the Company.  No Severance Benefits will be paid or
provided until the waiver and release agreement becomes effective.

4.5           Vacation Days.  Any unused vacation pay accrued as of a
Covered Employee’s date of Involuntary Termination will be paid at the time the
Covered Employee receives his or her Severance Benefit.  No Covered Employee may use any accrued but
unused vacation pay to extend his or her Involuntary Termination date.

5.             Termination of Benefits.  Benefits under this Plan shall terminate
immediately for a Covered Employee if such Covered Employee, at any time,
violates any proprietary information or confidentiality obligation to the
Company or the terms of any applicable non-competition agreement with the
Company.

6.             Non-Duplication of
Benefits.  Notwithstanding any
other provision in the Plan to the contrary, the Severance Benefits provided
hereunder shall be in lieu of any other severance and/or retention plan
benefits and the Severance Benefits provided hereunder shall be reduced by any
severance paid or provided to a Covered Employee under any other plan or
arrangement.

7.             Withholding.  The Company will withhold from any Severance
Benefit all federal, state, local and other taxes required to be withheld
therefrom and any other required payroll deductions.

8.             Administration.  The Company is the administrator of the Plan
(within the meaning of section 3(16)(A) of ERISA).  The Plan will be administered and interpreted
by the Administrator (in his or her sole discretion).  The Administrator is the “named fiduciary” of
the Plan for purposes of ERISA and will be subject to the fiduciary standards
of ERISA when acting in such capacity. 
Any decision made or other action taken by the Administrator with
respect to the Plan, and any interpretation by the Administrator of any term or
condition of the Plan, or any related document, will be conclusive and binding
on all persons and be given the maximum possible deference allowed 

 6
 

by
law.  The Administrator has the authority
to act for the Company (in a non-fiduciary capacity) as to any matter
pertaining to the Plan; provided, however, that this authority does not apply
with respect to (a) the Company’s power to amend or terminate the Plan or (b)
any action that could reasonably be expected to increase significantly the cost
of the Plan is subject to the prior approval of the senior officer of the
Company.  The Administrator may delegate
in writing to any other person all or any portion of his or her authority or
responsibility with respect to the Plan.

 

9.             Eligibility to Participate.  The Administrator will not be excluded from
participating in the Plan if otherwise eligible, but he or she is not entitled
to act or pass upon any matters pertaining specifically to his or her own
benefit or eligibility under the Plan. 
The senior officer of UTStarcom, Inc. will act upon any matters
pertaining specifically to the benefit or eligibility of the Administrator
under the Plan.

10.           Amendment or Termination.  The Company reserves the right to amend,
modify or terminate the Plan at any time, without advance notice to any Covered
Employee; provided, however, that, commencing on the date of a Change in
Control, no amendment or termination of the Plan shall reduce the Severance
Benefit payable to any Covered Employee (unless the affected Covered Employee
consents to such amendment or termination). 
Any action of the Company in amending or terminating the Plan will be
taken in a non-fiduciary capacity.

11.           Code Section 409A.

11.1         Amendment. 
Notwithstanding anything in this Plan to the contrary, the Company
reserves the authority to amend the Plan as it deems necessary or desirable,
and without the consent of any Covered Employee or without providing any
advance notice of any such amendment, in order to ensure the Plan complies with
Section 409A of the Code and any regulations and other guidance issued
thereunder.

11.2         Distributions.  In the event that the Administrator
determines that Section 409 A of the Code, or its regulations and other
guidance issued thereunder, would require the delay in the payment of any
Severance Benefits to a Covered Employee who would be considered a “Specified
Employee” (as defined below), the Administrator will, irrespective of any
election to the contrary or any other term of the Plan, delay the payment of
Severance Benefits until the date which is at least six (6) months after the
date of the Covered Employee’s Involuntary Termination.  For the purposes of this Section 11.2, the
term “Specified Employee” means any Covered Employee who would be considered a “Specified
Employee” as that term is defined in Section 409A(a)(2)(B)(i) of the Code.

12.           Claims Procedure.  Any employee or other person who believes he
or she is entitled to any payment under the Plan may submit a claim in writing
to the Administrator.  If the claim is
denied (in full or in part), the claimant will be provided a written notice
explaining the specific reasons for the denial and referring to the provisions
of the Plan on which the denial is based. 
The notice will also describe any additional information needed to
support the claim and the Plan’s procedures for appealing the denial.  The denial notice will be provided within 90
days after the claim is received.  If
special circumstances require an extension of time (up to 90 days), written
notice of the extension will be given within the initial 90-day period.  This notice of extension will 

 7
 

indicate the special circumstances requiring the
extension of time and the date by which the Administrator expects to render its
decision on the claim.

13.           Appeal Procedure.  If the claimant’s claim is denied, the
claimant (or his or her authorized representative) may apply in writing to the
Administrator for a review of the decision denying the claim.  Review must be requested within 60 days
following the date the claimant received the written notice of their claim
denial or else the claimant loses the right to review.  The claimant (or representative) then has the
right to review and obtain copies of all documents and other information
relevant to the claim, upon request and at no charge, and to submit issues and
comments in writing.  The Administrator
will provide written notice of his or her decision on review within 60 days
after it receives a review request.  If
additional time (up to 60 days) is needed to review the request, the claimant
(or representative) will be given written notice of the reason for the
delay.  This notice of extension will
indicate the special circumstances requiring the extension of time and the date
by which the Administrator expects to render its decision.  If the claim is denied (in full or in part),
the claimant will be provided a written notice explaining the specific reasons
for the denial and referring to the provisions of the Plan on which the denial
is based.  The notice shall also include
a statement that the claimant will be provided, upon request and free of
charge, reasonable access to, and copies of, all documents and other
information relevant to the claim and a statement regarding the claimant’s
right to bring an action under Section 502(a) of ERISA.

14.           Source of Payments.  All Severance Benefits will be paid in cash
from the general funds of the Company; no separate fund will be established
under the Plan; and the Plan will have no assets.  No right of any person to receive any payment
under the Plan will be any greater than the right of any other general
unsecured creditor of the Company.

15.           Inalienability.  In no event may any current or former
employee of the Company or any of its subsidiaries or affiliates sell,
transfer, anticipate, assign or otherwise dispose of any right or interest
under the Plan.  At no time will any such
right or interest be subject to the claims of creditors nor liable to
attachment, execution or other legal process.

16.           No Enlargement of
Employment Rights.  Neither
the establishment or maintenance of the Plan, any amendment of the Plan, nor
the making of any benefit payment hereunder, will be construed to confer upon
any individual any right to be continued as an employee of the Company.  The Company expressly reserves the right to
discharge any of its employees at any time, with or without cause.

17.           Applicable Law.  The provisions of the Plan will be construed,
administered and enforced in accordance with ERISA and, to the extent
applicable, the laws of the State of California.

18.           Severability.  If any provision of the Plan is held invalid
or unenforceable, its invalidity or unenforceability will not affect any other
provision of the Plan, and the Plan will be construed and enforced as if such
provision had not been included.

19.           Headings.  Headings in this Plan document are for
purposes of reference only and will not limit or otherwise affect the meaning
hereof.

 8
 

20.           Indemnification.  The Company hereby agrees to indemnify and
hold harmless the officers and employees of the Company, and the members of its
boards of directors, from all losses, claims, costs or other liabilities
arising from their acts or omissions in connection with the administration,
amendment or termination of the Plan, to the maximum extent permitted by
applicable law.  This indemnity will
cover all such liabilities, including judgments, settlements and costs of
defense.  The Company will provide this
indemnity from its own funds to the extent that insurance does not cover such
liabilities.  This indemnity is in
addition to and not in lieu of any other indemnity provided to such person by
the Company

21.           Additional Information.

 

	
  Plan Name:

  	
   

  	
  UTStarcom, Inc. Vice President Change in Control

  and Involuntary Termination Severance Pay Plan

  
	
   

  	
   

  	
   

  
	
  Plan Sponsor:

  	
   

  	
  UTStarcom, Inc.

  1275 Harbor Bay Parkway

  Alameda, CA 94502

  
	
   

  	
   

  	
   

  
	
  Identification Numbers:

  	
   

  	
  EIN: 52-1782500

  PLAN: [_________]

  
	
   

  	
   

  	
   

  
	
  Plan Year:

  	
   

  	
  Calendar year

  
	
   

  	
   

  	
   

  
	
  Plan Administrator:

  	
   

  	
  UTStarcom, Inc.

  Attention: Vice President, Human
  Resources

  1275 Harbor Bay Parkway

  Alameda, CA 94502

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (510) 864-8800

  
	
   

  	
   

  	
   

  
	
  Agent for Service of Legal Process:

  	
   

  	
  UTStarcom, Inc.

  Attention: General Counsel

  1275 Harbor Bay Parkway

  Alameda, CA 94502

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (510) 864-8800

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Service of process may also be made upon the Plan

  Administrator.

  
	
   

  	
   

  	
   

  
	
  Type of Plan:

  	
   

  	
  Bonus Plan/Severance Plan/Employee Welfare

  Benefit Plan

  
	
   

  	
   

  	
   

  
	
  Plan Costs:

  	
   

  	
  The cost of the Plan is paid by the Employer.

  

 

22.           Statement of ERISA Rights.

As a Covered
Employee under the Plan, you have certain rights and protections under ERISA:

 9
 

(a)           You may examine
(without charge) all Plan documents, including any amendments and copies of all
documents filed with the U.S. Department of Labor, such as the Plan’s annual
report (IRS Form 5500).  These documents
are available for your review in the Company’s Human Resources Department.

(b)           You may obtain
copies of all Plan documents and other Plan information upon written request to
the Plan Administrator.  A reasonable
charge may be made for such copies.

In addition to
creating rights for Covered Employees, ERISA imposes duties upon the people who
are responsible for the operation of the Plan. 
The people who operate the Plan (called “fiduciaries”) have a duty to do
so prudently and in the interests of you and the other Covered Employees.  No one, including the Company or any other
person, may fire you or otherwise discriminate against you in any way to
prevent you from obtaining a benefit under the Plan or exercising your rights
under ERISA.  If your claim for a
severance benefit is denied, in whole or in part, you must receive a written
explanation of the reason for the denial. 
You have the right to have the denial of your claim reviewed.  (The claim review procedure is explained in
Sections 12 and 13 above.)

Under ERISA, there
are steps you can take to enforce the above rights For instance, if you request
materials and do not receive them within 30 days, you may file suit in a
federal court.  In such a case, the court
may require the Plan Administrator to provide the materials and to pay you up
to $110 a day until you receive the materials, unless the materials were not
sent because of reasons beyond the control of the Plan Administrator.  If you have a claim which is denied or
ignored, in whole or in part, you may file suit in a state or federal
court.  If it should happen that you are
discriminated against for asserting your rights, you may seek assistance from
the U.S. Department of Labor, or you may file suit in a federal court.

In any case, the
court will decide who will pay court costs and legal fees.  If you are successful, the court may order
the person you have sued to pay these costs and fees.  If you lose, the court may order you to pay
these costs and fees, for example, if it finds that your claim is frivolous.

If you have any
questions regarding the Plan, please contact the Plan Administrator.  If you have any questions about this
statement or about your rights under ERISA, you may contact the nearest area
office of the Employee Benefits Security Administration (formerly the Pension
and Welfare Benefits Administration), U.S. Department of Labor, listed in your
telephone directory, or the Division of Technical Assistance and Inquiries,
Employee Benefits Security Administration, U.S. Department of Labor, 200
Constitution Avenue, N.W. Washington, D.C. 20210.  You may also obtain certain publications
about your rights and responsibilities under ERISA by calling the publications
hotline of the Employee Benefits Security Administration.

 10
 

23.           Execution.

In
Witness Whereof, the Company, by its duly authorized officer,
has executed this Plan on the date indicated below.

	
  

  	
  UTStarcom, Inc.

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  By:

  	
   

  	
  /s/ Francis Barton

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  Title:

  	
   

  	
  Executive VP, CFO

  
	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  Date:

  	
   

  	
  July 28, 2006

  	 

							

 

 11

ACKNOWLEDGMENT OF RECEIPT
OF

VICE PRESIDENT CHANGE IN
CONTROL AND INVOLUNTARY

TERMINATION SEVERANCE PAY
PLAN

 

I acknowledge that
I have received and read the Company’s Vice President Change in
Control and Involuntary Termination Severance Pay Plan.

 

	
   

  	
   

  	
   

  
	
  Name

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date

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