Loan Agreement – China Merchants Bank and UTStarcom (China) Co. Ltd.

[Translation]

Loan Agreement

    Contract 
Number: 2001 ChaoLiuZi No.005 

Lender:		China Merchants Bank, Beijing Branch, Chao Yang Men Subranch
Legal Representative:		Xiu Xiangqun		Position: President
Address:		No.6 ChaoYangMen Bei Da Jie, Dongcheng district, Beijing
Telephone:		85282361
Borrower:		UTStarcom (China) Co., Ltd.
Address:		Fll No.6 ChaoYangMen Bei Da Jie, Beijing Beijing
Legal Representative:		Hong Lu		Position: Chairman
Telephone:		65542030

WHEREAS:
Party A desires to borrow working capital loan from the Lender for business operation. In accordance with the related laws and stipulations, in consideration of the mutual
promise and to clarify the rights and obligations of each party, both parties agree to enter into this agreement and execute under this agreement.

1.

Variety:
Short term Revolving Fund.

2.

Loan
Amount: Reiminbi 50 million.

3.

Purpose:
The loan is used in working Capital Turnover and can not be appropriated for other purpose without the written approval of the Lender.

4.

Loan
Term: The duration of the loan under this agreement is twelve months which from March 14, 2001 to March 14, 2002.

5.

Interest
rate and calculation of Interest:

5.1 Interest
rate: [***]

During
the loan term, the interest rate will be adjusted in accordance with the provisions of the People’s Bank in the event the People’s Bank adjust the loan interest rate.

5.2 Calculation
of Interest:

Interest
shall accrue from draw-down date and be calculated [***]. The due date is [***] of very month (“due date”).

5.3 Payment
of interest:

The
Borrower shall pay off [***] interest on the due date. The Lender have the right to deduct the interest from the Borrower’s bank account in the
Lender. The Lender could collect compound interest in the event the Borrower fails to pay the interest on time.

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6.

Repayment
of Loan:

6.1 The
Borrower shall repay the principal and the interests pursuant to the provisions of this contract.

6.2 The
Borrower could advance the repayment with the approval from the Lender.

7.

Guarantee

7.1 The
principal, interest and other related expenses are guaranteed by UTStarcom (Hangzhou) Telecommunication Co., Ltd. and issues an irrevocable guaranty to
the Lender.

8.

Rights
of the Borrower

8.1 Draws
and use the loan;

8.2 Declines
other terms except this contract;

8.3 Assigns
the debt to any third party upon the approval of the Lender.

9.

Obligations
of the Borrower

9.1 Provides
true information upon the request by the Lender including all bank accounts, accounts number and balance of the accounts, assists the Lender to inspect
review and check.

9.2 Accepts
the supervision of the Lender regarding the use of loan and the status of manufacturing and finance.

9.3 Uses
the loan pursuant to the provision of this contract.

9.4 Repay
the due principal and interests on time.

9.5 Assigns
the all or partial debts under this agreements to any third party upon the written approval of the Lender.

9.6 Advance
notice to the Lender when the Borrower involves in contract, leasing, joint operation, consolidate (merger), liquidation, reorganization, joint venture or
cooperate with foreign company, equity sales, share reformation and change of business operation manner including but no limited to contract, lease, joint venture, acquisition, liquidation, present
and conversion into share company; The Borrower shall cooperate with the Lender to make efforts to make the Lender collect the principal and interests on time.

10.

Rights
of the Lender.

10.1 Requests
the Borrower to repay the principal and interests on due date according to the stipulations of this agreement;

10.2 Requests
the Borrower to provide the information related with the loan;

10.3 Knows
the Borrower’s manufacturing and financial status;

10.4 Supervises
the use of the loan in accordance with the term of this agreement;

10.5 Deducts
the outstanding principal and interest from the Borrowers bank account;

10.6 In
the event the Borrower fail to perform the payment obligation under this agreement, the Lender have right to request the Borrower to recall the loan ahead of
time, cease in extending the loan;

10.7 When
the Borrower involves in contract, leasing, joint operation, consolidate (merger), liquidation, reorganization, joint venture or cooperate with foreign
company, equity transference, share reformation, the Lender shall have right to request the Borrower clear of principal and the

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loan interest ahead of time, assign this loan to assignee confirmed by the Lender or provide acceptable guaranty to the Borrower.

11.

Responsibility
of the Lender

11.1 Extends
the loan in accordance with the stipulations of this agreement;

11.2 Holds
the Borrower’s debts, financial, operational information in confidential except special provisions in Law.

12.

Warranty
of the Borrower

12.1 The
Borrower is a company duly organized and validly existing under the law of the People’s Republic of China and has power and authority to sign and perform this
Contract;

12.2 Signature
and performance this contract is full authorized by the board or other authorization;

12.3 The
documents, information and files provided by the Borrower is true, correct, complete and effective without any material mistakes and missing.

12.4 The
Borrower respects the Lender’s operational policy which deposit and lending, credit and settlement is equal important. The Borrower warrants that its unused
funds will deposit in the Bank account in Lender and entrust the Lender handle the Borrower’s foreign currency settlement.

13.

Extension
of the Loan

In
case the Borrower could not to repay the loan under this contract and need to extend the loan, the Borrower shall apply to Party B for the extension of the loan within
[***] prior to maturity of the loan. The parties sign an extension loan agreement in written upon the approval of the Lender after the inspection made by the Lender. If the
Lender disagrees to the extension of the loan, the Borrower shall repay the principal and the interest in accordance with the stipulations set forth in this contract.

14.

Expenses

The
Borrower shall reimburse the Lender for [***] expenses in connection with [***]. The Lender is empowered to deduct the
[***] expense [***]. In the event that the money is not sufficient in the Borrower’s account, the Borrower shall clear the balance upon the notice from
the Lender [***]

15.

Liabilities
of Breach contract

15.1 In
the event the Borrower fails to perform the obligations set forth in section 9.1 or 9.2 in this agreement, if it is material or the Borrower does not
cure it timely, the Lender shall have right to cease in extending the loan and recall partial or total loan ahead of time.

15.2 The
Borrower fails to perform the obligation set forth in section 9.3, the Lender shall have right to collect an interest at the rate of
[***] for the amount misappropriated; If the matter is serious, the Lender shall have right to cease in extending the loan and recall partial or total loan ahead of time.

15.3 If
the Borrower fails to perform the obligation set forth in section 9.4, the Lender is entitled to collect an interest at the rate of
[***] for the default amount.

15.4 If
the Borrower fails to perform the obligation set forth in section 9.5 and 9.6, the Lender fails to collect the repayment, the Lender shall have right to
cease in extending the loan, recall the loan ahead of time. The Borrower shall compensate the Lender partial or all damage incurring from above default.

16.

Amendments
And Termination of Contract

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This
contract could be amended and terminated upon the written agreements conclude by the parties. The contract shall be effective before the written amendment is made. The contract
could not be changed, amended and terminated by one part without approval of the other part.

17.

Miscellaneous

17.1 During
the term of this contract, any tolerance, extension for the Borrows breach of contract and delay for excise any rights and benefit could not impair, affect
and limit the Lender to excise its rights in accordance with this contract and related laws and regulation. It should not be construed that the Lender permit or recognize the Borrower’s behaviors and
waive current or future rights to take action to defend the Borrower.

17.2 In
the event this contract or partial provisions contained in this Contract should be invalid, the Borrower shall perform the repayment responsibility. In the
event aforesaid, the Lender shall have right to terminate this contract and immediately request the Borrower to repay the loan, interest and other expenses.

17.3 The
notice and other communications required to be given by any party shall be in written. Telex and Telegram shall be deemed effectively given on the moment of
transmission. Letter shall be deemed effectively given on the receipt of the post office.

17.4 The
evidence of debt, the amendment, modification of the contract shall be made in written. Such documents shall be regard as the appendices of this contract and
integral part of this Agreement.

18.

Governing
Law and Dispute resolution

18.1 The
conclude, interpretation and dispute resolution shall be subject to the Laws of the People’s Republic of China. The rights of the parities shall be
safeguarded by the Laws of the People’s Republic of China.

18.2 The
disputes arising from execution of this contract shall be settled through friendly consultation by the parties. In case no settlement can be reached, the
disputes shall be submitted to the People’s Court of Beijing for judgment.

18.3 After
this contract is empower compulsory execution with legal effectiveness by notarization, the Lender may apply to the People’s court with jurisdiction to
execution the contract.

19.

Miscellaneous
Provisions

19.1 This
contract become effective after signed by the authorized representatives of both parties and go through the guaranty formality under Article 7 of this
contract until the loan and the interests and other related expenses be cleared up.

19.2 This
contract is executed in three original and be equally authentic. Each of the Borrower, the Lender and the Guarantor shall hold one copy.

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		Lender: China Merchants Bank, Beijing Branch, Chao Yang Men Subranch
		(signature)
		Borrower: UTStarcom (China) Co., Ltd.
		(signature)

March
14, 2001

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Translation Verification

The foregoing represents a fair and accurate English translation of the original Chinese document.

Dated:
May 11, 2001

		By:		/s/ SHAO-NING J. CHOU
		Name:		Shao-Ning J. Chou
		Title:		Executive Vice President and Chief Operating Officer, China Operations