Parts Supply Agreement - Sharp Corp. and UTStarcom Inc.


                             PARTS SUPPLY AGREEMENT


                                     BETWEEN


                                SHARP CORPORATION


                                       AND


                                 UTSTARCOM INC.






                                      INDEX

Article

1.   DEFINITIONS
2.   PURCHASE AND SUPPLY OF THE SUPPLY PARTS
3.   ORDER PROCEDURES
4.   PURCHASE PRICE
5.   TERMS OF PAYMENT
6.   INSPECTION
7.   SHIPMENT
8.   REMEDY FOR INCOMPLETE SUPPLY OF THE SUPPLY PARTS
9.   STOCK OF SPARE PARTS
10.  DURATION OF AGREEMENT
11.  TERMINATION
12.  COMPENSATION FOR DAMAGES
13.  ASSIGNMENT
14.  NOTICES
15.  ENTIRE AGREEMENT
16.  EXCEPTIONS
17.  ARBITRATION
18.  GOVERNING LAW AND TRADE TERMS
19.  MISCELLANEOUS




                             PARTS SUPPLY AGREEMENT

THIS AGREEMENT made and entered into this ______ day of ______________, 2000, by
and between

SHARP CORPORATION, a Japanese corporation, having its principal place of
business at 22-22, Nagaike-cho, Abeno-ku, Osaka, 545-8522 Japan (hereinafter
referred to as 'SHARP')

                                      and

UTSTARCOM INC., a Delaware corporation, having its principal place of business
at 1275 Harbor Bay Parkway, Suite 100, Alameda, CA 94502, U.S.A. (hereinafter
referred to as 'UTSTARCOM')

                                   WITNESSETH:

WHEREAS, SHARP has been engaged in the manufacture and sale of PHS terminal in
Japan; and

WHEREAS, UTSTARCOM is planning to cause EASTCOM (as defined below) to assemble
and manufacture the PRODUCTS (as defined below) and to cause HUTS (as defined
below) to distribute the PRODUCTS in the TERRITORY (as defined below). UTSTARCOM
wishes to purchase from SHARP and SHARP is willing to sell to UTSTARCOM
component parts of the PRODUCTS necessary to assemble, manufacture and repair
the PRODUCTS in the TERRITORY shall be purchased from SHARP; and

WHEREAS, UTSTARCOM and SHARP have entered into a technical collaboration
agreement dated           , 2000 (hereinafter referred to as 'TCA') with
respect to some license of SHARP's intellectual property rights and technical
know-how required to manufacture and distribute the PRODUCTS in the TERRITORY;

NOW, THEREFORE, the parties hereto hereby agree as follows:

Article 1. DEFINITIONS

Whenever used in this Agreement, unless otherwise clearly required by the
context, the following terms shall have the meaning set forth in the Article and
no other.

                                       1


(a)  The term 'TERRITORY' means [*]


(b)  The term 'PRODUCTS' means only such models of the products, which are:

     i)   specified in the EXHIBIT-A attached to TCA; and

     ii)  carrying the trademark 'UTStarcom' or other marks owned by
          UTSTARCOM or other marks designated by UTSTARCOM upon prior
          written consent of SHARP.

(c)  The term 'SUPPLY PARTS' means any or all materials and component parts for
     the PRODUCTS supplied in any form from SHARP, its subsidiary, related or
     affiliated company or designated factory.

(d)  The term 'HUTS' means UTSTARCOM (HANGZHOU) TELECOM CO., LTD, a corporation
     of People's Republic of China, a subsidiary of UTSTARCOM, having its
     principal place of business at 3 Yile Industrial Park, Bldg. 2/3 19 WenYi
     Road, Hangzhou, 310012, People's Republic of China, doing business of
     manufacturing, sales or distribution, and after-sales service of the
     communication related products.

(e)  The term 'EASTCOM' means EASTERN COMMUNICATIONS CO., LTD, a corporation of
     People's Republic of China, having its principal place of business at
     No.398. Wen San Road, Hangzhou, Zhe Jiang, People's Republic of China,
     doing business of assembly and manufacture of the mobile communication
     products.

Article 2. PURCHASE AND SUPPLY OF THE SUPPLY PARTS

(a)  UTSTARCOM agrees to purchase from SHARP and SHARP agrees to sell to
     UTSTARCOM the SUPPLY PARTS subject to and upon the terms and conditions
     contained herein.

(b)  UTSTARCOM shall not, without the prior written consent of SHARP, cause
     EASTCOM and/or HUTS to use the SUPPLY PARTS for any purposes other than for
     the manufacture and assembly of the PRODUCTS in the TERRITORY or sell or
     otherwise dispose of the SUPPLY PARTS, either directly or indirectly, to
     any third party in the TERRITORY or elsewhere in the world.

[*] * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY 
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT 
TO THE OMITTED PORTIONS.

                                       2


Article 3. ORDER PROCEDURES

(a)  UTSTARCOM shall place with SHARP monthly purchase orders in writing for the
     SUPPLY PARTS at least [*] before the [*] of the production month of the
     SUPPLY PARTS thereby ordered or at least [*] before the [*] of the month in
     which the SUPPLY PARTS are to be shipped from the relevant port(s) of
     shipment, whichever is applicable. By the [*] of each month, non-binding
     rolling forecasts for the SUPPLY PARTS order for the period of next [*]
     shall be given to Sharp by UTSTARCOM for Sharp's smooth arrangements of the
     SUPPLY PARTS. In case the relevant SUPPLY PARTS are to be manufactured
     outside Japan, however, the number of months provided above shall be
     increased by [*].

(b)  The quantity of each model of the SUPPLY PARTS to be ordered by each of
     such purchase orders shall be integral multiple of [*].

(c)  Such purchase orders shall be deemed only to be offers by UTSTARCOM to
     purchase the SUPPLY PARTS on and subject to the terms and conditions of
     this Agreement and such other terms and conditions as may be set forth in
     any SHARP price-list, estimate or other similar documents in effect at the
     date when UTSTARCOM's order is accepted.

(d)  SHARP may accept or reject the purchase orders submitted by UTSTARCOM. The
     acceptance by SHARP of such purchase orders shall be made only by execution
     and delivery by SHARP of the SALES CONTRACT (which form is designated by
     SHARP and is subject to revision made from time to time by SHARP at its
     sole discretion), thereupon such SALES CONTRACT shall be deemed to be the
     final and conclusive contract between the parties for the purchase and sale
     of the SUPPLY PARTS therein described. Immediately upon receipt by
     UTSTARCOM of the said SALES CONTRACT, UTSTARCOM shall sign and return to
     SHARP the duplicate copy of such SALES CONTRACT but failure of UTSTARCOM to
     do so shall not affect the validity of such SALES CONTRACT as provided
     hereinabove. It is specifically agreed, however, that if any export license
     or permission is required for the exportation of the SUPPLY PARTS the SALES
     CONTRACT shall come into effect only when such export license or permission
     shall have been obtained. UTSTARCOM agrees that due to delay in obtaining
     such license or permission the shipping date of the SUPPLY PARTS as set
     forth in the SALES CONTRACT may be delayed and that such delay shall not
     constitute a breach by SHARP of the SALES CONTRACT; provided, however, that
     SHARP will ship the SUPPLY PARTS as soon as practicable after the shipping
     date set forth in the SALES CONTRACT. In the event of any conflict or
     inconsistency between the terms and conditions

[*] * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY 
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT 
TO THE OMITTED PORTIONS.

                                       3




     of this Agreement and those of any SALES CONTRACT, the terms and conditions
     of this Agreement shall prevail with respect only to such conflicting or
     inconsistent provisions, except for such terms and conditions as may be
     typewritten on the face of such SALES CONTRACT.

Article 4. PURCHASE PRICE

All SUPPLY PARTS shall be sold to UTSTARCOM at the prices established or
confirmed by SHARP and in effect at the time when UTSTARCOM's purchase order is
accepted by SHARP. All prices for the sale of the SUPPLY PARTS under any SALES
CONTRACT shall be specified in Japanese yen.

Article 5. TERMS OF PAYMENT

(a)  At least [*] before the shipping date specified in the relevant SALES
     CONTRACT, UTSTARCOM shall establish, [*], with a leading and first class
     bank (such bank shall be changed at the request of SHARP to be made from
     time to time), an irrevocable and, if so requested by SHARP, confirmed
     letter of credit (not restricted, unless otherwise agreed upon) in full
     amount specified in the SALES CONTRACT in Japanese yen (unless otherwise
     agreed upon) in favour of SHARP available at [*] after the date of the bill
     of lading or air waybill for the shipment of Supply Parts to be drawn on
     the establishing bank (unless otherwise agreed upon). A confirming bank
     shall be a leading and first class international bank acceptable to SHARP
     and, unless otherwise agreed upon, be a bank other than the establishing
     bank of the letter of credit. Such letter of credit shall provide for
     partial shipments and shall remain valid for not less than [*] after the
     last day specified for shipment. In the event that the letter of credit is
     to be advised by facsimile, UTSTARCOM shall cause a written confirmation
     thereof to be air-mailed to SHARP via the advising bank. The said letter of
     credit shall also include stipulations to the following effect:

     In reimbursement to the negotiating bank by the establishing bank, priority
     shall be given to the 'debit authorization method' by which the letter of
     credit shall have stipulated as a Reimbursement Instruction the following:

     'we authorize you to debit our account with you at maturity.' If the
     foregoing method is not available for some inevitable reason(s), the
     'remittance method' will be acceptable, in which case settlement shall be
     made by Telegraphic Transfer.

     Transfer charge of letter of credit, payment commission, acceptance
     commission, confirming

[*] * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY 
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT 
TO THE OMITTED PORTIONS.

                                       4


     charge, reimbursement charge, advising charge and amendment charge, if any,
     shall be for the account of UTSTARCOM.

(b)  If UTSTARCOM fails to provide such letter of credit as prescribed in
     paragraph (a) above, SHARP may at its option postpone the time for shipment
     of the SUPPLY PARTS then unshipped or cancel any SALES CONTRACT and resell
     the involved SUPPLY PARTS without incurring any liability to UTSTARCOM on
     the part of SHARP. UTSTARCOM shall be responsible for any loss or damage to
     SHARP caused by such postponement or cancellation or failure to establish
     such letter of credit as provided above.

Article 6. INSPECTION

The SUPPLY PARTS shall be inspected before the shipment thereof by SHARP at its
relevant factory whether in Japan or elsewhere. The inspection executed pursuant
to the provisions of this Article shall be deemed to be final and conclusive in
respect of the quantity, quality, performance and other conditions of the SUPPLY
PARTS and SHARP shall be under no liability or obligation (including incidental
loss, products liability or other consequential loss) whatsoever except for
those specifically provided in Article 8 hereof, for any defect in quality or
performance or shortage in quantity of the SUPPLY PARTS which have passed such
inspection. UTSTARCOM shall not be entitled to reject such inspected SUPPLY
PARTS nor to claim any refund of the purchase price nor to suspend the due and
punctual performance of its obligations hereunder or under the relevant SALES
CONTRACT.

Article 7. SHIPMENT

(a)  Unless otherwise agreed, shipment shall be effected [*] at any Japanese or
     foreign port(s) in one shipment or in installments by any carrier of any
     flag subject to the carrier's space being available. The quantity of each
     shipping lot of the SUPPLY PARTS shall be from time to time determined by
     SHARP.

(b)  The date of Bill of Lading or of similar document(s) shall be deemed to be
     conclusive evidence of the date of such shipment.

Article 8. REMEDY FOR INCOMPLETE SUPPLY OF THE SUPPLY PARTS

(a)  In the event that after inspection executed pursuant to Article 6 hereof
     any defect in quality

[*] * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY 
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT 
TO THE OMITTED PORTIONS.

                                       5


     or performance of any SUPPLY PARTS which fails to be repaired or recovered
     by UTSTARCOM, HUTS and/or EASTCOM (hereinafter called the 'DEFECTIVE
     PARTS') or shortage in quantity is found in respect to any shipping lot of
     the SUPPLY PARTS, and;

     (i)  UTSTARCOM shall have notified SHARP in writing to the foregoing effect
          in reasonable detail within [*] after the date of the arrival of the
          relevant SUPPLY PARTS at the destination specified in the relative
          Bill of Lading, accompanied by documentary evidence satisfactory to
          SHARP showing that such defect or shortage in quantity is the result
          of faulty workmanship or mistake on the part of SHARP, or that such
          defect or shortage in quantity arises from any cause for which SHARP
          is responsible; and

     (ii) UTSTARCOM shall have submitted to SHARP a survey report issued by
          first-class sworn authorized surveyor(s) satisfactory to SHARP as well
          as the report on form established by SHARP for the purpose of
          verification by SHARP or SHARP's representative at EASTCOM's factory,
          within [*] after the request of SHARP so to submit; and

    (iii) the DEFECTIVE PARTS shall have been held by HUTS being retained
          intact for SHARP's inspection for a period of [*] after the
          notification made by UTSTARCOM pursuant to condition (i) above or
          until UTSTARCOM shall have received instructions from SHARP permitting
          UTSTARCOM and/or HUTS to dispose of such DEFECTIVE PARTS, whichever is
          the earlier; and

    (/ /) UTSTARCOM shall have returned the DEFECTIVE PARTS to SHARP, subject
          to the instruction of SHARP set forth in condition (iii) above; and

    (/ /) the sum of the quantity of any individual DEFECTIVE PARTS and/or that
          of the shortage in any individual component, contained in the shipping
          lot of the SUPPLY PARTS which shall have satisfied the foregoing
          conditions (i) through (iv) shall exceed [*] of the total quantity of
          any such individual component contained in each such shipping lot of
          the SUPPLY PARTS;

Then, SHARP shall, as soon as possible after satisfaction of the foregoing
conditions (i) through (v), provide UTSTARCOM free of charge with the
replacement parts or supplementary parts of the relevant SUPPLY PARTS in such
quantity which shall be the balance of the sum set forth in condition (v) above
minus [*] of the total quantity of such individual component contained in such
shipping lot of the SUPPLY PARTS. SHARP shall bear the ocean transportation
charges required for its provision of aforementioned parts.

[*] * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY 
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT 
TO THE OMITTED PORTIONS.

                                       6


(b)  In the event that UTSTARCOM and/or HUTS fail to satisfy any of the
     conditions (i) through (v) above in accordance therewith, UTSTARCOM shall
     be deemed to have waived all its claims in respect to any defect or
     shortage in quantity of such shipping lot of the SUPPLY PARTS.

(c)  SHARP agrees to pay the transportation charges reasonably incurred by
     UTSTARCOM in respect of sending back the DEFECTIVE PARTS to SHARP pursuant
     to paragraph (a) of this Article. Such payment shall be made by SHARP
     without delay after the conditions (i) through (v) set forth in paragraph
     (a) above shall have been satisfied.

Article 9. STOCK OF SPARE PARTS

(a)  In order to satisfy the orders from UTSTARCOM for repair and replacement
     parts or their interchangeable parts, as the case may be, which shall be
     necessary for HUTS's after-sales service of the PRODUCTS. SHARP shall be
     prepared to supply UTSTARCOM with such parts for each model of the PRODUCTS
     for the period commencing with the date of the latest shipment of the
     relevant SUPPLY PARTS hereunder and ending on such date after the said
     shipment as SHARP deems it reasonable. SHARP may and, if requested by
     UTSTARCOM in writing, shall from time to time designate at its sole
     discretion the length of such period and notify UTSTARCOM of such period.
     UTSTARCOM shall, at least [*] before the termination of such designated
     period, place with SHARP the last order for purchasing such parts for the
     PRODUCTS as may be required for the after-sales service of the relevant
     PRODUCTS during the rest of the life of such relevant PRODUCTS. In the
     event that UTSTARCOM fails to place orders for purchasing such parts with
     SHARP by the time-limit stated above, SHARP's obligations to supply such
     parts under this Article shall cease without any compensation or remedy
     whatsoever to UTSTARCOM.

(b)  In case SHARP determines the discontinuance of any equivalent model to the
     PRODUCTS which results in SHARP's inability to supply the SUPPLY PARTS for
     that model, SHARP shall, at least [*] before the date from which the supply
     of such SUPPLY PARTS becomes unavailable notify UTSTARCOM of such date and
     model of the PRODUCTS. UTSTARCOM shall, within [*] of such notification,
     place with SHARP the last order for purchasing such parts for the PRODUCTS
     as may be required for the after-sales service of the relevant PRODUCTS
     during the rest of the life of the relevant PRODUCTS. Notwithstanding
     anything to the contrary contained herein or in paragraph(b) of this
     Article, in the event that UTSTARCOM fails to place with SHARP orders for
     purchasing any parts of the model of the PRODUCTS in respect of which the
     manufacture is to be discontinued as aforesaid by the time-limit stated
     above, SHARP's obligations to supply such parts shall

[*] * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY 
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT 
TO THE OMITTED PORTIONS.

                                       7


     cease without any compensation or remedy whatsoever to UTSTARCOM.

(c)  Purchase and supply of the parts set forth in paragraphs(b) and (c) of this
     Article shall, unless otherwise agreed upon by the parties hereto, be made
     in compliance with the relevant terms and conditions of this Agreement,
     provided, however, that SHARP may not reject such orders to the extent that
     the assortment and quantity of such parts are then available to be supplied
     by SHARP.

(d)  If SHARP deems it necessary or advisable to provide technical information
     to UTSTARCOM for assembly and manufacture of the PRODUCTS by using the
     SUPPLY PARTS or for after-sales service, sales promotion or the like of the
     PRODUCTS, SHARP will do so after consultation with UTSTARCOM subject always
     to any necessary license requirements or permission of relevant government
     authorities.

Article 10. DURATION OF AGREEMENT

This Agreement shall be deemed to have been come into force on the 1st day of
December, 1999 retroactively, and unless earlier terminated in accordance with
the provision hereof or otherwise shall continue in force and effect until and
including the [*]. It is understood by the parties hereto that this Agreement
shall be, either automatically or with amendment or modification (if any),
renewed hereafter on a [*] basis, unless either of the parties hereto gives to
the other party at least [*] prior written notice to terminate this Agreement
before the expiration of the initial term or any extended term of this
Agreement. If such prior written notice is made by either party, then this
Agreement shall terminate on the initial or, as the case may be, duly extended
expiration date of this Agreement.

Article 11. TERMINATION

(a)  In the event of the occurrence of any of the following events to either
     SHARP or UTSTARCOM (including HUTS and/or EASTCOM, as the case may be, for
     the purpose of this Article), the other party may forthwith terminate this
     Agreement by sending a written notice to the first party by registered
     airmail:

     (i)  If either party continues in default of any material obligation
          imposed on it herein, in any SALES CONTRACT or any other agreement
          concluded hereunder or thereunder or in connection herewith or
          therewith for more than two (2) months after written notice has been
          despatched by registered airmail by the other party requesting the
          party in default to

[*] * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY 
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT 
TO THE OMITTED PORTIONS.

                                       8


          remedy such default;

     (ii) If either party hereto is subjected to compulsory execution, public
          auction, coercive collection for its arrearage of taxes or public
          imposts, or suspension of business by public authorities, or
          appointment of any receiver or trustee of itself or any substantial
          portion of its property, or if an application or petition is submitted
          for bankruptcy, corporate arrangement or commencement of corporate
          reorganization, or if either party hereto files voluntarily against it
          an application or petition for bankruptcy, corporate arrangement or
          commencement of corporate reorganization or composition, or if either
          party hereto adopts a resolution for discontinuance of its business or
          for a substantial decrease of its capital or for dissolution or merger
          into another company, or makes general assignment for the benefit of
          creditors or if either party hereto becomes unable to pay debts, or if
          either party is declared in default of any material contract between
          it and any third party and any such contract is cancelled or its
          payment obligation under such contract is accelerated (All the
          foregoing shall include the likeliness of each occurrence in the
          reasonable opinion of the other party);

    (iii) If, due to any substantial change in ownership, management or
          effective control of either party or in the objects of the company
          stated in the Memorandum of Association or Articles of Incorporation
          or a similar document of either party, (1) there exist, or in the
          reasonable opinion of the other party there is any ground to suspect
          the existence of, any obstacles to the effective continuance of this
          Agreement or any SALES CONTRACT, or (2) there occurs a situation which
          on the reasonable opinion of the other party would be detrimental to
          its interests; or

    (/ /) If the TCA is terminated or expired for any reason; or

     (v)  If there is any other cause justifying either party to terminate this
          Agreement, such as material and irreparable injury to goodwill or
          reputation of the other party, commission by other party of a fraud on
          or betrayal of confidence in or criminal act against the first party,
          disclosure or divulgence by the other party of the first party's
          confidential information.

(b)  Except as otherwise specifically provided elsewhere in this Agreement any
     termination of this Agreement shall be without prejudice to any right and
     remedy which shall have accrued to either party under or in connection with
     this Agreement or the SALES CONTRACT prior to such termination.

(c)  Notwithstanding the provisions specified in this Article, unless this
     Agreement is terminated by a cause or causes which SHARP deems attributable
     to UTSTARCOM, UTSTARCOM

                                       9


     may dispose of the SUPPLY PARTS in the TERRITORY which UTSTARCOM have on
     hand at the time of termination of this Agreement within such a reasonable
     period of time as may be agreed upon by the parties provided that such
     disposal is made without impairing SHARP's reputation in the TERRITORY.

Article 12. COMPENSATION FOR DAMAGES

(a)  In the event that either party defaults in the due performance of its
     obligations hereunder, under any SALES CONTRACT or under any other
     agreement made pursuant to or in connection with this Agreement or any
     SALES CONTRACT, or in the event that this Agreement or SALES CONTRACT is
     terminated or cancelled pursuant to paragraph (a) of Article 12 hereof, or
     any other provisions contained herein or therein, then the other party or
     the party dispatching a notice of termination or cancellation pursuant to
     relevant provisions contained herein or therein (collectively the 'Affected
     Party') may demand compensation from the first party for the losses,
     damages, incurred or sustained by the Affected Party as a result of any
     such default, termination or cancellation.

     The foregoing provisions of this Article shall not prejudice the right of
     the Affected Party to extend the time for performance of any of its
     obligations hereunder or under any SALES CONTRACT to the extent of the
     duration of such default of the other party or to cancel any SALES CONTRACT
     in respect of which the performance of any terms is then in default.

(b)  UTSTARCOM shall defend, indemnify and hold harmless SHARP from and against
     any and all actions, claims, demands, suits, losses, damages, costs,
     expenses and judgements (including attorney's fee thereof) by whomever
     made, brought or prosecuted and in any manner based upon, arising out of,
     related to, occasioned by or attributable to any breach by UTSTARCOM and/or
     HUTS of any provisions of this Agreement or any act or omission by
     UTSTARCOM, its employees or agents in the performance thereof.

(c)  SHARP shall defend, indemnify and hold harmless UTSTARCOM from and against
     any and all actions, claims, demands, suits, losses, damages, costs,
     expenses and judgements (including attorney's fee thereof) by whomever
     made, brought or prosecuted and in any manner based upon, arising out of,
     related to, occasioned by or attributable to any breach by SHARP of any
     provisions of this Agreement or any act or omission by SHARP, its employees
     or agents in the performance thereof.

(d)  Without prejudicing the right of SHARP to terminate or cancel this
     Agreement and/or any SALES CONTRACT and any other rights and remedies of
     SHARP contained herein or in

                                       10


     any SALES CONTRACT, if the SUPPLY PARTS are not shipped on the shipping
     date specified in the relevant SALES CONTRACT due to any cause whatsoever
     due to UTSTARCOM, including, without limitation, delay in or repudiation of
     taking delivery of such SUPPLY PARTS or delay in performance of the
     obligations of UTSTARCOM hereunder or under such SALES CONTRACT, UTSTARCOM
     shall pay SHARP an overdue interest at the rate of [*] per annum of (i) the
     full amount of the price of the relevant SUPPLY PARTS specified in such
     SALES CONTRACT, accruing from and including such shipping date to and
     including the actual shipping date or the date on which such SALES CONTRACT
     is cancelled by SHARP hereunder, whichever date is applicable and (ii) the
     losses, damages and expenses incurred or suffered by SHARP due to said
     cancellation of the SALES CONTRACT, accruing from and including such
     cancellation date to and including the date of actual payment by the
     UTSTARCOM of said losses, damages and expenses.

(e)  In any event, the parties hereto each disclaim any and all liability for
     special, incidental, or consequential damages (including loss of profit)
     relating to the terms and conditions of this Agreement.

Article 13. ASSIGNMENT

Neither party shall assign, transfer or otherwise dispose of this Agreement in
whole or in part or any right or obligation hereunder to any individual, firm or
corporation without the prior consent of the other party in writing.

Article 14. NOTICES

(a)  Except as otherwise provided herein all notices to be given or made under
     this Agreement shall be in writing and sent by registered air-mail and
     addressed to the principal office of the parties as indicated hereinabove
     or to such other address as either party may hereafter furnish to the other
     party in writing.

(b)  All notices shall be deemed to have been given or made on the day of
     despatch.

Article 15. ENTIRE AGREEMENT

This Agreement constitutes the entire and only agreement between the parties
hereto as to the subject matter contained herein and supersedes all previous
understandings, commitments and

[*] * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY 
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT 
TO THE OMITTED PORTIONS.

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agreements whether oral or written relating to the subject matter hereof, and no
modification, amendment or supplement of this Agreement shall be binding upon
the parties hereto except by mutual express written consent of subsequent date
signed by authorized representative or officer of each of the parties hereto.

Article 16. EXCEPTIONS

(a)  SHARP shall not be liable for any delay in shipment or delivery,
     non-delivery or destruction or deterioration, of all or any part of the
     SUPPLY PARTS or for any other default in performance under this Agreement
     or any SALES CONTRACT, which arises from any lockout, strike, labor trouble
     or other industrial disturbance, inevitable accident, export cartel by
     governmental authorities or industry or trade association of whatever
     nature to limit its export of the SUPPLY PARTS, fire, explosion,
     transportation difficulty, materials or labor shortage, SHARP's
     subcontractor's or supplier's suspension or inability of or delay in
     production or shipment of the SUPPLY PARTS, or from any cause beyond the
     control of SHARP, including without limitation, war, blockade, embargo,
     mobilizations, governmental, administrative or public direction or guidance
     or order of any country including any reasonably anticipated direction or
     guidance or order thereof, legal restriction imposed in any country
     including any reasonably anticipated restriction thereof, riot, civil
     commotion, warlike condition, prolonged failure or shortage of electric
     power, gas, or oil, epidemic, earthquake, flood, typhoon, or other Act of
     God.

(b)  In the event of any delay or failure due to cause or causes given in the
     preceding paragraph (a), SHARP shall send by facsimile, e-mail or otherwise
     a written notice stating the reason therefor to UTSTARCOM as promptly as
     possible. The performance of SHARP shall be deemed suspended as long as,
     and to the extent that, any such cause(s) continue, but this Agreement
     and/or any SALES CONTRACT then executory shall not be regarded as
     terminated, frustrated or cancelled simply as a result of such delay or
     failure and the parties hereto shall continue once more with its
     performance when the cause or causes of such delay or failure have ceased
     or have been eliminated, provided, however, that if such delay or failure
     extends or is reasonably anticipated to extend for a period of more than
     three(3) months, SHARP may without any liability on its part terminate or
     cancel this Agreement and/or the said SALES CONTRACT by sending a written
     notice to UTSTARCOM to the extent that SHARP's performance has been
     prevented or delayed.

Article 17. ARBITRATION

Any dispute arising from the execution of, or in connection with, this Agreement
shall be settled

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through friendly consultation between the parties. If the dispute cannot be
settled within sixty (60) days from the first date of consultation, the dispute
shall be settled by arbitration consisting of three (3) arbitrators. Arbitration
shall be held in San Francisco, California under the International Arbitration
Rules of the American Arbitration Association if initiated by SHARP, and shall
be held in Osaka, Japan under the Commercial Arbitration Rules of the Japan
Commercial Arbitration Association if initiated by UTSTARCOM. The award rendered
by the arbitration shall be final and binding upon the parties and may be
entered by any court having jurisdiction.

Article 18. GOVERNING LAW & TRADE TERMS

(a)  It is mutually agreed that the terms of this Agreement and the performance
     hereunder shall in all respects be governed, construed and interpreted in
     accordance with the laws of Japan, excluding its provisions regarding
     conflict of laws.

(b)  If and to the extent applicable the trade terms used in this Agreement
     shall have the meaning given to such terms in the International Commercial
     Terms (Incoterms 1990).

Article 19. MISCELLANEOUS

(a)  SEPARABILITY: The parties hereto agree that, in the event of one or more of
     the provisions hereof being subsequently declared invalid or unenforceable
     by court or administrative decision, such invalidity or unenforceability of
     any of the provisions shall not in any way affect the validity or
     enforceability of any other provisions hereof except those which the
     invalidated or unenforceable provisions comprise an integral part of or are
     otherwise clearly inseparable from such other provisions.

(b)  WAIVER: A waiver by a party hereto of any particular provision hereof shall
     not be deemed to constitute a waiver in the future of the same or any other
     provision of this Agreement.

(c)  EXPENSES: Unless otherwise expressly agreed herein, in the SALES CONTRACT
     or otherwise in writing by the parties hereto, each party shall bear all
     losses, damages, liabilities, expenses and disbursements incurred or made
     by itself or any other investment made by itself in connection with or in
     pursuance of this Agreement or any SALES CONTRACT, and neither party shall
     be entitled to compensation or remedy of any kind whatsoever from the other
     party for the said losses, damages, liabilities, expenses, disbursements or
     investment whether on termination of this Agreement or any SALES CONTRACT
     for any reason whatsoever or otherwise unless otherwise expressly agreed
     upon in writing by the other party.

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(d)  TITLE: The Article titles in this Agreement have been inserted for
     convenience only and shall in no way be used in the interpretation hereof.

(e)  GUARANTEE OF HUTS AND EASTCOM: UTSTARCOM hereby unconditionally guarantees
     to SHARP the due and punctual performance by HUTS and/or EASTCOM of all the
     material terms and conditions of this Agreement to be performed by HUTS
     and/or EASTCOM hereunder, and indemnifies and holds SHARP harmless from and
     against any damages, costs, expenses and other liabilities incurred by
     SHARP by reason of failure of HUTS and/or EASTCOM to fully perform and
     comply with the material terms and conditions of this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
by their respective representatives or officers duly authorized thereunto as of
the date first above written.

SHARP CORPORATION                                UTSTARCOM INC..

BY:                                              BY:
   -----------------------------------------        ---------------------------
Name:   Sueyuki Hirooka                            Name:   Hong Liang Lu
Title:  Corporate Senior Executive Director        Title:  President & Chief
        & Group General Manager of                         Executive Officer
        International Business Group













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