UTStarcom Commences Noteholder Consent Solicitation

UTStarcom Commences Noteholder Consent Solicitation

UTStarcom, Inc. (Nasdaq: UTSI), a global leader in IP-based, end-to-end networking solutions and services, today announced that it is soliciting consents from the holders of its 7/8% convertible subordinated notes due 2008 (CUSIP Nos. 918076AA8 and 918076AB6). UTStarcom is seeking consents to proposed amendments of certain provisions of the indenture pursuant to which the notes were issued and a waiver of rights to pursue remedies available under the indenture with respect to certain defaults thereunder. The consent solicitation is expected to expire at 5:00 p.m., New York City time, on Friday, Jan. 5, 2007, unless extended to a later time or date or terminated early (the “Expiration Date”).

As previously disclosed, UTStarcom has not yet filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q for the quarter ended September 30, 2006. The trustee contends that the delay in filing constitutes a default under the indenture and has given UTStarcom a notice of default. UTStarcom believes that the notice of default is invalid and without merit, in part because the indenture does not specify a time period within which UTStarcom must file its report with the SEC. However, for the time being, UTStarcom has determined to solicit consents to proposed amendments to the indenture that would give UTStarcom until Thursday, May 31, 2007, to become current in its reporting obligations and a waiver of rights to pursue remedies available under the indenture with respect to any purported default caused by its delay in filing SEC reports or by its failure to deliver certain compliance certificates to the trustee concerning its compliance with the provisions of the Indenture.

Holders of record as of 5:00 p.m., New York City time, on December 21, 2006, who validly deliver and do not revoke their consents prior to the Expiration Date, will receive a consent fee of $5,492,000 divided pro rata among all consenting noteholders. The effectiveness of the proposed amendments and waiver and the payment of the consent fee is subject to the receipt of valid consents that are not revoked in respect of at least a majority of the aggregate principal amount outstanding of the notes. Holders of the notes may revoke their consents at any time before the proposed amendments and waiver become effective, but upon receipt by UTStarcom of the consents of a majority of holders of the notes and evidence of such receipt provided to the trustee the waiver will become effective, a supplemental indenture setting forth the amendments will be executed and consents may no longer be revoked unless UTStarcom fails to pay holders the consent fee.

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