S-3

As filed with the Securities and Exchange Commission on January 22, 2002

Registration No. 333-          

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form S-3

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Novatel Wireless, Inc.

(Exact name of registrant as specified in its charter)

Delaware	86-0824673
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification)

9360 Towne Centre Drive

San Diego, California 92121

(858) 320-8800

(Address of principal executive offices, including zip code, and phone number, including area code)

Copies to:

Melvin L. Flowers,

Senior Vice President, Finance, Chief Financial Officer and Secretary

9360 Towne Centre Drive

San Diego, California 92121

(858) 320-8800

(Name, address, including zip code, telephone number, including area code, of Agent for service)

     Approximate Date Of Commencement Of Proposed Sale To The Public: From time to time after this registration statement becomes effective.

         If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box.    o

         If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box.    þ

         If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

         If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

         If delivery of the same prospectus is expected to be made pursuant to Rule 434, please check the following box.    o

CALCULATION OF REGISTRATION FEE

Title of each class of securities	Amount to be	Proposed maximum aggregate	Amount of
to be registered	registered(1)	offering price(2)	registration fee
Common Stock, par value $.001 per share	46,374,804	$48,693,544	4,480

(1)	In the event of a stock split, stock dividend or similar transaction involving the common stock of the registrant, in order to prevent dilution, the number of shares of common stock registered hereby shall be automatically adjusted to cover the additional shares of common stock in accordance with Rule 416 under the Securities Act of 1933, as amended.
(2)	The price is estimated in accordance with Rule 457(c) under the Securities Act of 1933, as amended, solely for the purpose of calculating the registration fee and is $1.05, the average of the high and low prices of common stock of Novatel Wireless, Inc. as reported by The Nasdaq National Market on January 18, 2002.

          The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a) may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED JANUARY 22, 2002

PRELIMINARY PROSPECTUS

Novatel Wireless, Inc.

46,374,804 shares of Common Stock

        The stockholders of Novatel Wireless, Inc. (“Novatel” or the “Company”) listed in this prospectus are offering and selling 46,374,804 shares of common stock under this prospectus. These shares of common stock include the resale of:

•  35,288,311 shares of common stock issuable upon conversion of 27,172 shares of our Series A and Preferred Stock; and

•  11,086,493 shares of common stock issuable upon exercise of common stock purchase warrants.

      The selling stockholders may offer their common stock:

•  through public or private transactions,

•  on or off the United States exchanges,

•  at prevailing market prices; or

•  at privately negotiated prices.

      Novatel’s common stock trades on The Nasdaq National Market under the ticker symbol “NVTL.” On January 18, 2002, the closing price of one share of Novatel’s stock was $1.04.

       This investment involves a high degree of risk. You should invest only if you can afford a complete loss of your investment. See “Risk Factors” beginning on page 3.

       Neither the Securities and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is                     , 2002.

TABLE OF CONTENTS

EXHIBIT 4.1

EXHIBIT 4.2

EXHIBIT 4.3

EXHIBIT 4.4

EXHIBIT 4.5

EXHIBIT 5.1

EXHIBIT 10.1

EXHIBIT 10.2

EXHIBIT 23.2

TABLE OF CONTENTS

Prospectus Summary	1
Risk Factors	3
Use of Proceeds	13
Recent Developments	13
Dividend Policy	14
Shares Available for Future Sale	14
Selling Stockholders	15
Description of Capital Stock	16
Plan of Distribution	22
Legal Matters	23
Experts	23
Where You Can Find More Information	23
Special Note Regarding Forward-Looking Statements	23
Incorporation of Certain Documents by Reference	23

      You should rely only on the information contained or incorporated by reference in this prospectus and in any prospectus supplement. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We will not make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus and the accompanying prospectus supplement is accurate as of the date on their respective covers. Our business, financial condition, results of operations and prospects may have changed since that date.

PROSPECTUS SUMMARY

      The following summary is qualified in its entirety by the more detailed information and financial statements appearing elsewhere or incorporated by reference in this prospectus. Without limiting the generality of the foregoing, prospective investors should carefully consider the factors set forth under the caption “Risk Factors.”

Our Company

      We are a provider of wireless data communications access solutions, including wireless data modems and software for use with handheld computing devices and portable personal computers. We deliver innovative and comprehensive solutions that enable businesses and consumers to access personal, corporate and public information through email, enterprise networks and the Internet. We also offer wireless data modems and custom engineering services for hardware integration projects in a wide range of vertical applications. In addition, we offer provisioning, activation and systems integration services to our customers to facilitate use of our products.

      Our current product portfolio includes the following:

•  The Minstrel Family of Wireless Handheld Modems, for the Palm Family of handheld computing devices and the Handspring Family of handheld computing devices;

•  The Merlin Family of Wireless Type II PC Card Modems for portable and desktop PCs;

•  The Sage Wireless Modems for portable and desktop PCs;

•  The NRM-6812 and Expedite Family of Wireless OEM Modems for custom integration with computers and other devices; and

•  The Lancer 3W Family of Ruggedized Wireless Modems for vehicle-mounted applications.

      During 2001, our financial condition, results of operations and cash flows were adversely affected by various factors including overall decreases in demand in the marketplace for both wireless products and wireless access services for the transmission of data. Our management believes this trend will continue for at least the next several quarters.

      Our principal executive offices are located at 9360 Towne Centre Drive, Suite 110, San Diego, California 92121 and our telephone number is (858) 320-8800.

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The Offering

Common stock offered by the selling stockholders (estimate)	46,374,804 shares(1)
Shares of common stock outstanding at December 31, 2001	54,643,762 shares(2)
Shares of common stock outstanding after the offering	101,018,566(3)
Use of proceeds	We will not receive any proceeds from the sale of shares of the common stock by the selling stockholders. See “Use of Proceeds.”
Risk factors	See the “Risk Factors” section and other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in shares of our common stock.
Nasdaq National Market symbol	NVTL

(1)	Includes: (i) 35,288,311 shares of common stock issuable upon conversion of 27,172 shares of our Series A Convertible Preferred Stock (the “Series A Preferred Stock”) issued in a private placement in December 2001 (the “2001 Private Placement”); (ii) 10,586,493 shares of common stock issuable upon exercise of common stock purchase warrants issued in connection with the issuance of the Series A Convertible Preferred Stock (the “Investor Warrants”); and (iii) 500,000 shares of common stock issuable upon exercise of certain outstanding warrants.
(2)	Excludes: (i) approximately 9,136,874 shares of common stock subject to presently outstanding options granted by us under our stock option plans, of which options to purchase 3,747,606 shares of common stock are exercisable as of the date of this prospectus; (ii) warrants to purchase 10,804,593 shares of common stock, all of which are exercisable as of the date of this prospectus; and (iii) the shares of common stock offered in this prospectus.
(3)	The number of shares outstanding after the offering is based on the number of shares of common stock outstanding as of December 31, 2001 (assuming the issuance of all common stock issuable upon conversion of the Series A Preferred Stock and exercise of the warrants covered by this prospectus) and excludes: (i) 9,136,874 shares of common stock issuable upon exercise of stock options outstanding as of December 31, 2001, at a weighted average exercise price of $4.93 per share (options to purchase 3,831,044 shares of common stock were exercisable as of December 31, 2001 and the balance become exercisable in the future based upon continued employment); and (ii) warrants to purchase 10,804,593 shares of common stock, all of which are exercisable as of the date of this prospectus.

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RISK FACTORS

      An investment in our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described below and other information contained in this prospectus before you decide whether to invest in our common stock. If any of the following risks actually occur, our business, financial condition, results of operations and liquidity could be materially adversely affected. This may cause the trading price of our common stock to decline after this offering, and you could lose part or all of the money you paid to purchase our common stock.

RISKS RELATED TO OUR BUSINESS

We have incurred significant operating losses since our inception and we expect to continue to incur significant net losses and negative cash flows for the foreseeable future.

      We have experienced operating losses and net losses in each quarterly and annual period since our inception, and we expect to continue to incur significant losses for the foreseeable future. We incurred net losses of $3.5 million for the eight months ended December 31, 1996, $4.5 million for the year ended December 31, 1997, $5.5 million for the year ended December 31, 1998, $18.5 million for the year ended December 31, 1999, $46.9 million for the year ended December 31, 2000 and $68.5 million for the nine months ended September 30, 2001. In addition, we had negative cash flows from operations of $3.5 million for the year ended December 31, 1997, $5.0 million for the year ended December 31, 1998, $5.2 million for the year ended December 31, 1999, $41.0 million for the year ended December 31, 2000 and $46.6 million for the nine months ended September 30, 2001. As of September 30, 2001, we had an accumulated deficit of $154.4 million. We expect our operating expenses and negative cash flows to continue in connection with new product introductions as we continue to attempt to expand our business, including related increases in product development, sales and marketing, research and development, manufacturing, and general and administrative expenses. We entered into and expect to continue to enter into significant customer contracts for the development and supply of our products. These contracts may place significant demands on our resources. If we are unable to increase our revenue sufficiently to offset these expenses, we will not achieve profitability and our operating losses, net losses and negative cash flows will continue.

We have been operating only since 1996 and our historic operating results may not be an indication of future operations.

      We launched our first wireless modem in 1996. We have a limited operating history. We are subject to risks, expenses and uncertainties that young and growing companies like ours face, particularly in the evolving wireless communications market. These considerations include our ability to continue to expand our customer base, maintain our current strategic-relationships and develop new ones, deliver products associated with our key contracts in a profitable and timely manner, attract and retain qualified personnel and manage our growth. Because we have only recently commenced commercial sales of our products, our past results and rates of growth may not be meaningful, and they should not be relied upon as an indicator of our future performance.

If we cannot deliver products associated with our significant contracts in a profitable and timely manner, our reputation could be harmed and our revenue and profit margins may decrease.

      Our ability to generate future revenue under many of our significant supply contracts depends upon our ability to manufacture and supply products that meet defined specifications. To realize the benefits of these agreements, we will have to manage the following risks successfully:

•  We have priced these contracts on our estimate of future production costs. If we incur higher costs than anticipated, our gross margins on these contracts will decrease and these contracts may not be as profitable as they otherwise may have been.

•  If we are unable to commit the necessary resources or are unable to deliver our products as required by the terms of these contracts, our customers may cancel the contracts. In that event, we might not

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	recover any costs that we incurred for research and development, sales and marketing, production and otherwise and we may incur additional costs as contractual penalties.
•	If we fail to meet a delivery deadline, or a customer determines that the products we delivered do not meet the agreed-upon specifications, we may have to reduce the price we can charge for our products, or we may be liable to pay damages to the customer.

If we are unable to successfully manage these risks or meet required deadlines in connection with one or more of our key contracts, our reputation could be harmed and our business, financial condition, results of operations and liquidity could be materially adversely affected.

If the demand for wireless access to the Internet does not increase, our revenue will continue to decline.

      Our financial condition, results of operations and cash flows were adversely affected during 2001 as a result of overall decreases in demand in the marketplace for both wireless products and wireless access services for the transmission of data. Our management believes that this trend will continue for at least the next several quarters. If this trend continues, our financial condition will be further adversely affected. A decrease in our cash flows or our failure to generate significant revenue from new or existing products, whether due to lack of market acceptance, competition, technological change or otherwise, or the inability to reduce manufacturing or operating costs, will adversely impact our business, financial condition and results of operations.

The marketability of our products may suffer if wireless telecommunications operators do not deliver acceptable wireless services.

      The success of our business depends on the capacity, affordability and reliability of wireless data access provided by various wireless telecommunications operators. Currently, various wireless telecommunications operators such as Verizon Wireless, either directly or jointly with us, sell our products in connection with the sale of their wireless data access services to their customers. Growth in demand for wireless data access may be limited if wireless telecommunications operators cease operations, fail to offer services which customers consider valuable, fail to maintain sufficient capacity to meet demand for wireless data access, delay the expansion of their wireless networks and services, fail to offer and maintain reliable wireless network services or fail to market their services effectively. If any of these occur, or if for any other reason the demand for wireless data access fails to grow, sales of our products will decline and our business, financial condition and results of operations could be materially adversely affected.

      In addition, our future growth depends on the successful deployment of next generation wireless data networks by third parties, including those networks for which we currently are developing products. If these next generation networks are not deployed or widely accepted, or if deployment is delayed, there will be no market for the products we are developing to operate on these networks. As a result, we will not be able to recover our research and development expenses and our financial condition and results of operations and liquidity could be materially adversely affected.

We currently rely exclusively on third-party manufacturers to produce our products, and our ability to control their operations is limited.

      We currently outsource all our manufacturing to Sanmina Corporation and Solectron de Mexico, S.A. de C.V. We expect to continue to depend exclusively on third-party manufacturers to produce our products in a timely fashion and at satisfactory quality levels. None of these third-party manufacturers is obligated to supply products to us for any specific quantity, except as may be provided in particular purchase orders which we submit to them from time to time. If our third-party manufacturers experience delays, disruptions, capacity constraints or quality control problems in their manufacturing operations, then product shipments to our customers could be delayed, which would negatively impact our revenues and our competitive position and reputation. The cost, quality and availability of third-party manufacturing operations are essential to the

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successful production and sale of our products. Our reliance on our third-party manufacturers exposes us to a number of risks, which are outside our control:

•  unexpected increases in manufacturing costs;

•  interruptions in shipments if our third-party manufacturers are unable to complete production in a timely manner;

•  inability to control quality of finished products;

•  inability to control delivery schedules;

•  inability to control production levels and to meet minimum volume commitments to our customers;

•  inability to control manufacturing yield;

•  inability to maintain adequate manufacturing capacity; and

•  inability to secure adequate volumes of components.

      If we are unable to manage successfully our relationships with these third-party manufacturers, the quality and availability of our products may be harmed. If any of our third-party manufacturers stopped manufacturing our products or reduced its manufacturing capacity, we may be unable to replace the lost manufacturing capacity on a timely basis. In addition, if any of our third-party manufacturers changed the terms under which they manufacture for us, our manufacturing costs could significantly increase. We generally place orders with our third-party manufacturers at least three months prior to scheduled delivery of products to our customers. Accordingly, if we inaccurately anticipate demand for our products, we may be unable to obtain adequate quantities of components to meet our customers’ delivery requirements or we may accumulate excess inventories. If one or more of these events were to occur, our business, financial condition and results of operations could be materially adversely affected by increased costs, reduced revenue and lower profit margins.

If we fail to adopt new technology and fail to develop and introduce new products successfully, we may not be able to compete effectively.

      We operate in a highly competitive environment, characterized by rapidly changing technology and industry standards. New products based on emerging technologies or evolving industry standards may quickly render an existing product obsolete and unmarketable. Our growth and future operating results depend in part upon our ability to enhance existing products and introduce newly developed products that conform to prevailing and evolving industry standards, meet or exceed technological advances in the marketplace, meet changing customer requirements, achieve market acceptance and respond to our competitors’ products.

      The development of new products can be very difficult and requires technological innovation. The development process is also lengthy and costly. In addition, wireless communications service providers require that wireless data systems deployed on their networks comply with their own standards, which may differ from the standards of other providers. If we fail to anticipate our customers’ needs and technological trends accurately or are otherwise unable to complete the development of products on time and within budgeted amounts, we will be unable to introduce new products into the market on a timely basis, if at all. If we are unsuccessful at developing and introducing new products that are appealing to consumers, we may be unable to recover our significant research and development costs and our business, financial condition and results of operations could be materially adversely affected. In addition, as we introduce new versions of our products or new products, our current customers may not require the technological innovations of our new products and may not purchase them.

      To grow our revenue and achieve profitability, we must retain our current customers and develop new ones. If consumers view our competitors’ products as superior to ours, or if our products are unable to meet their expectations or requirements, we may be unable to retain our existing customers or to develop new customers which would materially and adversely effect our business, financial condition and results of operations.

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The fluctuation of our quarterly operating results may cause our stock price to decline.

      Our future quarterly operating results may fluctuate significantly and may not meet the expectations of securities analysts or investors. If this occurs, the market price of our stock would likely decline. The following factors may cause fluctuations in our operating results:

•  Decreases in revenue or increases in operating expenses. We budget our operating expenses based on anticipated sales, and a significant portion of our sales and marketing, research and development and general and administrative costs are fixed, at least in the short term. If revenue decreases and we are unable to reduce our operating costs quickly and sufficiently, our operating results could be materially adversely affected. We have entered into and expect to continue to enter into significant customer contracts for the development and supply of our products. We expect to incur significant research and development, sales and marketing and other costs relating to the development, manufacture and sale of these products prior to receiving revenue from these contracts.

•  Product mix. The product mix of our sales affects profit margins in any given quarter. As our business evolves and the revenue from the product mix of our sales varies from quarter to quarter, our operating results will likely fluctuate.

•  New product introductions. As we introduce new products, the timing of these introductions will affect our quarterly operating results. We may have difficulty predicting the timing of new product introductions and the market acceptance of these new products. If products and services are introduced earlier or later than anticipated, or if market acceptance is unexpectedly high or low, our quarterly operating results may fluctuate unexpectedly. Our quarterly operating results also fluctuate because we incur substantial upfront research and development, sales and marketing, production and other costs to support new product introductions prior to the periods in which we will recognize revenue from new products.

•  Use of supply contracts with customers. We rely on long-term supply contracts with our distributor customers. These contracts typically have minimum purchase volumes, and also typically include a non-binding, forward-looking rolling forecast and allow the customer to make certain volume changes within specified periods of time in advance of scheduled production dates. We use these forecasts for internal planning of material procurement and required manufacturing capacity, but cannot predict with certainty incoming orders or changes in forecasts. Our operating results may fluctuate as a result of deviations from forecasted amounts, the timing of substantial orders, decreases in orders, failure to fulfill orders, possible delays or shortages in component supplies, or possible delays in the manufacture or shipment of current or new products.

•  Lengthy sales cycle. In addition, the length of time between the date of initial contact with a potential customer and the execution of a contract may take several months, and is subject to delays over which we have little or no control. The sale of our products is subject to delays from our customers’ budgeting, approval and competitive evaluation processes that typically accompany significant information technology purchasing decisions. For example, customers frequently begin by evaluating our products on a limited basis and devote time and resources to testing our products before they decide whether or not to purchase a product. We commit substantial time and resources to educate potential customers on the use and benefits of our products. Customers may also defer orders as a result of anticipated releases of newer or enhanced products by us or our competitors. As a result, our ability to anticipate the timing and volume of sales to specific customers is limited, and the delay or failure to complete one or more large transactions could cause our operating results to vary significantly from quarter to quarter.

      We believe that quarter-to-quarter comparisons of our operating results will not necessarily be meaningful in predicting our future performance. If we do not achieve our expected revenue, it is possible that our operating results will fall below the expectations of market analysts or investors in some future quarter or quarters. Our failure to meet these expectations would likely adversely affect the trading price of our common stock.

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We depend upon a small number of our customers for a substantial portion of our revenue.

      A significant portion of our revenue comes from a small number of customers. Our top ten customers for the year ended December 31, 2000 and the nine months ended September 30, 2001 accounted for approximately 78.7% and 73.5% of our revenue, respectively. OmniSky, @Road and GoAmerica accounted for 45.4%, 8.7% and 5.6% of our revenue, respectively, for the year ended December 31, 2000. Hewlett Packard, Metricom and @Road accounted for 15.6%, 14.9% and 10.5% of our revenue, respectively, for the nine months ended September 30, 2001. We expect that a small number of customers will continue to account for a substantial portion of our revenue for the foreseeable future. Our business was impacted adversely by the bankruptcy of Metricom, which filed for bankruptcy in July 2001. Sales to Metricom accounted for 16.8% of our revenue for the six months ended June 30, 2001. On December 7, 2001, OmniSky issued a press release announcing that it had signed a purchase agreement to sell substantially all of its assets and that OmniSky intended to voluntarily file for bankruptcy. If there is a downturn in the business of one or more of these customers, if one or more of these customers files for bankruptcy or becomes insolvent, if we are unable to continue to retain their business, or if we are unable to diversify our customer base, our revenue may decline.

We depend on sole source suppliers for some of our components, and our product availability and sales would be harmed if these suppliers are not able to meet our demand and alternative sources are not available.

      Our products contain a variety of components, many of which are procured from single suppliers. These components include both tooled parts and industry-standard parts, many of which are used in cellular telephone handsets. Currently, some components and certain integrated circuits are in short supply worldwide due to the explosive growth in demand for cellular-telephone handsets. If the shortage of these components or any other key components persists or worsens, we may not be able to deliver sufficient quantities of our products to satisfy demand. The cost, quality and availability of components are essential to the successful production and sale of our products. Some of these components come from sole or single source suppliers for which alternative sources may not be available. If suppliers are unable to meet our demand for sole source components and if we are unable to obtain an alternative source or if the price for a substitute is prohibitive, our ability to maintain timely and cost-effective production of our products would be seriously harmed.

If we fail to develop and maintain strategic alliances, we may not be able to penetrate new markets.

      A key element of our business strategy is to penetrate new markets by developing new products through strategic alliances with leading companies. We are currently investing, and plan to continue to invest, significant resources to develop these relationships. We believe that our success in penetrating new markets for our products will depend in part on our ability to maintain these relationships and to cultivate additional or alternative relationships. We cannot assure you that we will be able to develop additional strategic alliances, that existing relationships will be successful in achieving their purposes or that strategic partners will not form competing arrangements.

Any further reduction in demand for handheld computing devices or for our products designed for those devices may harm our business.

      A significant amount of our revenue is generated by our products for handheld computing devices and portable PCs. The demand for handheld computing devices and portable PCs has decreased significantly in the past twelve months and we cannot assure you that the demand for those devices will increase in the future. In addition, certain recent models of handheld computing devices and portable PCs include internal wireless modems installed by the manufacturer which reduce the need for consumers to purchase our wireless modem products. If demand for handheld computing devices and portable PCs declines or as more consumers purchase handheld computing devices and PCs with internal wireless modems, the demand for our products will materially decrease and our revenue will decline.

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We may not be able to maintain and expand our business if we are not able to hire, retain and manage additional qualified personnel.

      Our success in the future depends in part on the continued contribution of our executive, technical, engineering, sales, marketing, manufacturing and administrative personnel. Recruiting and retaining skilled personnel, including software and hardware engineers, is highly competitive, especially in the San Diego area. Most of our senior management and other key personnel are not bound by employment agreements. If we are not able to attract or retain qualified personnel in the future, or if we experience delays in hiring required personnel, particularly qualified engineers, we will not be able to maintain and expand our business.

Any acquisitions we make could disrupt our business and harm our financial condition and results of operations.

      As part of our business strategy, we intend to review on an ongoing basis acquisition opportunities that we believe would be advantageous to the development of our business. While we have no current agreements or current discussions with respect to any acquisitions, we may acquire businesses, products, or technologies in the future. If we make any acquisitions, we could take any or all of the following actions, any one of which could adversely affect our business, financial condition, results of operations and the price of our common stock:

•  issue equity securities that would dilute existing stockholders’ percentage ownership;

•  use a substantial portion of our available cash, including proceeds from this offering;

•  incur substantial debt, which may not be available to us on favorable terms and may adversely affect our liquidity;

•  assume contingent liabilities; and

•  take substantial charges in connection with acquired assets.

      Acquisitions also entail numerous risks, including: difficulties in assimilating acquired operations, products and personnel; unanticipated costs; diversion of management’s attention from other business concerns; adverse effects on existing business relationships with suppliers and customers; risks of entering markets in which we have limited or no prior experience; and potential loss of key employees from either our preexisting business or the acquired organization. We may not be able to successfully integrate any businesses, products, technologies or personnel that we might acquire in the future, and our failure to do so could harm our business and operating results.

Our future results could be harmed by risks associated with international sales and operations.

      We plan to expand our international sales and marketing activities in the future. We have limited experience in marketing, selling, distributing and manufacturing our products and services internationally. For the year ended December 31, 2000 and the nine months ended September 30, 2001, approximately 7% and 8.5%, respectively, of our revenue was derived from international accounts. As we expand international sales, we expect to become subject to a number of risks, which may increase our costs, lengthen our sales cycle and require significant management attention. These risks associated with doing business internationally generally include:

•  changes in foreign currency exchange rates;

•  changes in a specific country’s or region’s political or economic conditions, particularly in emerging markets, and changes in diplomatic and trade relationships;

•  less effective protection of intellectual property;

•  trade protection measures and import or export licensing requirements;

•  potentially negative consequences from changes in tax laws;

•  increased expenses associated with customizing products for foreign countries;

•  unexpected changes in regulatory requirements resulting in unanticipated costs and delays;

•  longer collection cycles and difficulties in collecting accounts receivable; and

•  difficulty in managing widespread sales and research and development operations.

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      Our sales and invoices are currently denominated in U.S. dollars. In the future, however, we may record sales and invoice customers in the applicable local foreign currency. If that occurs, we may be exposed to international currency fluctuations.

The wireless communications market is highly competitive and we may be unable to compete effectively.

      We compete in the wireless communications markets. The markets for wireless data access products are highly competitive and we expect competition to increase. Many of our competitors or potential competitors have significantly greater financial, technical and marketing resources than we do. These competitors may be able to respond more rapidly than we can to new or emerging technologies or changes in customer requirements. They also may devote greater resources than we do to the development, promotion and sale of their products.

      Many of our competitors have more extensive customer bases and broader customer relationships and industry alliances that they could leverage to establish relationships with many of our current and potential customers. These companies also have significantly more established customer support and professional services organizations. In addition, these companies may adopt aggressive pricing policies or offer more attractive terms to customers, may bundle their competitive products with broader product offerings and may introduce new products and enhancements. Current and potential competitors may establish cooperative relationships among themselves or with third parties to enhance their products. As a result, it is possible that new competitors or alliances among competitors may emerge and rapidly acquire significant market share.

      Our wireless communications products compete with a variety of devices, including wireless modems, traditional wired modems, wireless handsets, wireless handheld computing devices and other wireless devices. Our current and potential competitors include:

•  wireless modem manufacturers, such as Sierra Wireless, Wavecom, Option, NextCell and Tellus;

•  traditional wired modem manufacturers, such as 3Com and Xircom;

•  wireless device manufacturers, such as Handspring, Palm and Research in Motion (Blackberry);

•  wireless handset manufacturers and next generation wireless technology providers, such as Ericsson, Motorola, Kyocera and Nokia; and

•  non-CDPD private communications network providers, such as Emotiant and Bell South.

      We expect our competitors to continue to improve the performance of their current products and to introduce new products, services and technologies. Successful new product introductions or enhancements by our competitors could reduce our sales and the market acceptance of our products, cause intense price competition and make our products obsolete. To be competitive, we must continue to invest significant resources in research and development, sales and marketing, and customer support. We cannot be sure that we will have sufficient resources to make these investments or that we will be able to make the technological advances necessary to remain competitive. Increased competition could result in price reductions, fewer customer orders, reduced margins and loss of our market share. Our failure to compete successfully could seriously harm our business, financial condition and results of operations.

Our products may contain errors or defects, which could decrease their market acceptance.

      Our products are technologically complex and must meet stringent user requirements. We must develop our software and hardware products quickly to keep pace with the rapidly changing and technologically advanced wireless communications market. Products as sophisticated as ours may contain undetected errors or defects, especially when first introduced or when new models or versions are released. Our products may not be free from errors or defects after commercial shipments have begun, which could result in the rejection of our products, damage to our reputation, lost revenues, diverted development resources, and increased customer service and support costs and warranty claims.

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We could incur substantial costs defending our intellectual property from infringement or a claim of infringement.

      Our success depends in large part on our proprietary technology. We rely on a combination of patents, copyrights, trademarks and trade secrets, confidentiality provisions and licensing arrangements to establish and protect our proprietary rights. We may be required to spend significant resources to monitor and police our intellectual property rights. Before we do so, we may not be able to detect infringement and we may lose competitive position in the market. Intellectual property rights also may be unavailable or limited in some foreign countries, which could make it easier for competitors to capture market share. The unauthorized use of our technology by competitors could have a material adverse effect on our ability to sell our products in some markets.

      Although we are not currently involved in any intellectual property litigation, we may be a party to litigation in the future either to protect our intellectual property or as a result of an alleged infringement of others’ intellectual property. These claims and any resulting litigation could subject us to significant liability for damages and could cause our proprietary rights to be invalidated. Litigation, regardless of the merits of the claim or outcome, would likely be time-consuming and expensive to resolve and would divert management time and attention away from the operation of our business. Any potential intellectual property litigation could also force us to do one or more of the following:

•  stop using the challenged intellectual property and refrain from selling our products or services that incorporate it;

•  obtain a license to use the challenged intellectual property or to sell products or services that incorporate it, which license may not be available on reasonable terms, or at all; and

•  redesign those products or services that are based on or incorporate the challenged intellectual property.

      If we are forced to take any of the foregoing actions, we may be unable to manufacture and sell our products, and our business, financial condition and results of operations may be materially adversely affected.

We may not be able to develop products that comply with applicable government regulations.

      Our products must comply with government regulations. For example, in the United States, the Federal Communications Commission (the “FCC”) regulates many aspects of communications devices, including radiation of electromagnetic energy, biological safety and rules for devices to be connected to the telephone networks. Radio frequency devices, which include our modems, must be approved under the above regulations by obtaining equipment authorization from the FCC prior to being offered for sale. Additionally, we cannot anticipate the effect that changes in government regulations may have on our ability to develop products in the future. Failure to comply with existing or evolving government regulations or to obtain timely regulatory approvals or certificates for our products could materially adversely affect our business, financial condition and results of operations. An inability or delay in obtaining FCC authorization could result in a decline in future revenue.

Terrorist attacks have contributed to economic instability in the United States; continued terrorist attacks, war or other civil disturbances could lead to further economic instability and depress our stock price.

      On September 11, 2001, the United States was the target of terrorist attacks of unprecedented scope. These attacks have caused instability in the global financial markets, and have contributed to downward pressure on stock prices of United States publicly traded companies, such as us. This instability has resulted in a slowdown in the employment sector as companies assessed the impact of the attacks on their operations and on their employment needs. These attacks may lead to armed hostilities or to further acts of terrorism and civil disturbances in the United States or elsewhere, which may further contribute to economic instability in the United States and could have a material adverse effect on our business, financial condition and operating results.

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RISKS RELATED TO THIS OFFERING

Our stock price could be adversely affected by shares becoming available for sale under Rule 144 and as a result of registration rights agreements we have entered into with some of our stockholders.

      Some of our current stockholders hold a substantial number of shares which they will be able to sell in the public market in the near future. Sales of a substantial number of shares of our common stock under Rule 144, or the perception that these sales may occur, could cause the trading price of our common stock to fall and could impair our ability to raise capital through the sale of additional equity securities. In addition, we have entered into registration rights agreements with some investors that entitle these investors to have their shares registered for sale in the public market. The exercise of these rights could affect the market price of our common stock. See “Shares Eligible for Future Sale” for further information concerning potential sales of our shares after this offering, including information concerning Rule 144 and the registration rights we have granted.

The quoted market price of our common stock is volatile, and we cannot assure you that our stock price will not decline.

      The market price of our common stock could be subject to significant fluctuations after this offering as a result of numerous factors, many of which are beyond our control. Among the factors that could affect our stock price are:

•  quarterly variations in our operating results;

•  changes in revenue or earnings estimates or publication of research reports by analysts;

•  speculation in the press or investment community about our business or the wireless communications industry generally;

•  changes in market valuations of similar companies and stock market price and volume fluctuations generally;

•  strategic actions by us or our competitors such as acquisitions or restructurings;

•  regulatory developments;

•  additions or departures of key personnel;

•  general market conditions, including the effect of market conditions on our customers and suppliers; and

•  domestic and international economic factors unrelated to our performance.

      The stock markets in general, and the markets for high technology stocks in particular, have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our common stock.

Anti-takeover provisions in our charter documents and under Delaware law could prevent or delay a change in control in our company.

      Our certificate of incorporation and bylaws contain anti-takeover provisions that could prevent or delay an acquisition of our company at a premium price. These provisions:

•  provide for a staggered board;

•  prevent stockholders from taking action by written consent;

•  limit the persons who may call special meetings of stockholders; and

•  authorize our board of directors to approve the issuance of undesignated preferred stock without stockholder approval.

      In addition, Delaware law imposes some restrictions on mergers and other business combinations between us and any holder of 15% or more of our common stock.

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Our directors, executive officers and existing stockholders and their affiliates will continue to have substantial control over our company after this offering, and their interests may differ from and conflict with yours.

      Upon completion of this offering, our executive officers, directors and principal stockholders will beneficially own, in total, 31.34% of our outstanding common stock. As a result, these stockholders, whose interests may be different from and may conflict with yours, will be able to influence matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions. This could have the effect of delaying or preventing a change of control of our company or otherwise cause us to take action that may not be in the best interests of all stockholders, either of which in turn could reduce the market price per share of our common stock.

Your ownership interest may be materially diluted upon conversion of Series A Preferred Stock.

      Holders of Series A Preferred Stock are entitled to convert their shares into shares of common stock. The holders of common stock will be materially diluted by conversion of the Series A Preferred Stock which dilution will depend on, among other things, the future market price of our common stock and the decisions by holders of the Series A Preferred Stock as to when to convert the shares. If all 27,172 shares of Series A Preferred Stock were converted at the initial conversion price of $0.77 per share (which represents the average quoted per share price of the common stock for the 20 trading-day period ending December 12, 2001, the day the commitment letter for the offering of the Series A Preferred Stock was executed, less a discount of 13.5%) and all outstanding Investor Warrants issued with those shares were exercised on the first date on which the Series A Preferred Stock may be converted, at an initial exercise price of $1.20 per share, we would issue a total of approximately 45,874,804 shares of common stock. See “Description of Capital Stock.”

Your ownership interest may be materially diluted upon exercise of options and warrants.

      As of December 31, 2001, we had granted options to purchase an aggregate of 9,136,874 shares of common stock at exercise prices ranging from $0.42 per share to $12.88 per share, with a weighted average exercise price of $4.93 per share, and warrants to purchase an aggregate of 10,804,593 million shares (excluding the Investor Warrants) of common stock at exercise prices ranging from $0.67 per share to $3.79 per share, with a weighted average exercise price of $1.16 per share. To the extent that all the stock options and warrants are exercised, material dilution of the ownership interest of our stockholders will occur. We also expect that in the ordinary course of our business we will issue additional warrants and grant additional stock options including, but not limited to, options granted pursuant to our stock option plans. You should note that the recent trading prices of the common stock significantly exceed our book value for financial accounting purposes. See “Description of Capital Stock” and “Shares Available for Future Sale.”

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USE OF PROCEEDS

      We will not receive any proceeds from the sale of shares of the common stock by the selling stockholders. However, certain of the shares of common stock offered hereby are issuable in the future upon the exercise of the Investor Warrants issued in connection with the 2001 Private Placement and the payment consideration of $1.20 per share. If all of the Investor Warrants are exercised, we will receive aggregate gross proceeds of approximately $12.7 million. In addition, if all of the approximately 10,804,593 shares of common stock issuable upon the exercise of warrants issued in other private placement transactions are exercised, we will receive gross proceeds of approximately $12.5 million in the aggregate. We expect to use the proceeds from the exercise of the warrants and options, if any, for general corporate purposes. See “Description of Capital Stock.”

RECENT DEVELOPMENTS

      In December 2001, we completed a private placement transaction in which we received gross proceeds of $27,172,000 in connection with the issuance of 27,172 shares of Series A Preferred Stock. In connection with the 2001 Private Placement, we issued Investor Warrants to purchase 10,586,493 shares of common stock. The number of shares of common stock issuable upon conversion of the Series A Preferred Stock and upon exercise of the Investor Warrants is subject to adjustment in the event of a stock split, stock dividend or similar transaction. See “Description of Capital Stock.” As a result of the 2001 Private Placement, we should have sufficient working capital to allow us to continue operations for the next 12 months.

      In November 2001, we entered into a variable credit facility with Silicon Valley Bank, Commercial Finance Division. Currently, the credit limit is equal to:

•  the lesser of: (i) $10,000,000 at any one time outstanding; or (ii) 80% of the amount of our receivables arising from the ordinary course of our business.

      This credit facility bears interest at prime plus 2% (6.75% at January 15, 2002), is secured by our inventory, equipment, receivables, general intangibles, proceeds and products, and expires on November 27, 2002. This line of credit is cancelable at any time by us prior to the expiration date with proper notice and payment of an early termination fee. As of January 18, 2002, $727,858 of borrowings were outstanding under this facility and we had available borrowings equal to $4,125,056. In connection with this facility, we issued Silicon Valley Bank warrants to acquire 500,000 shares of our common stock at an initial exercise price of $0.74 per share. The warrants expire on November 29, 2008.

      We and certain of our officers and directors were sued along with the underwriters to our initial public offering in a suit filed November 20, 2001 in United States District Court for the Southern District of New York. We were recently served with the complaint and have not appeared in the action. The complaint alleges that the defendants violated federal securities laws by issuing and selling common stock pursuant to our initial public offering without disclosing to investors that some of the underwriters in the offering, including the lead underwriters, had solicited and received undisclosed and excessive commissions from certain investors. Similar lawsuits have been filed with respect to a large number of companies, which completed their initial public offerings in 1999 and 2000. The progress and possible settlement of the litigation will depend heavily on the coordinated progress of all of the related lawsuits that have been filed in the Southern District of New York, including certain test cases against selected issuers. We believe that the claims alleged in the lawsuit are primarily directed at the underwriters of our initial public offering and, as they relate to us, are without merit. We intend to defend the lawsuit vigorously.

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DIVIDEND POLICY

      We have never declared or paid any cash dividends on our common stock. We currently intend to retain any future earnings to finance the growth and development of our business. Therefore, we do not anticipate that we will declare or pay any cash dividends on our common stock in the foreseeable future. Any future determination to pay cash dividends will be at the discretion of our board of directors and will be dependent upon our financial condition, results of operations, capital requirements, restrictions under any existing indebtedness and other factors the board of directors deems relevant.

SHARES AVAILABLE FOR FUTURE SALE

      Upon completion of the offering, we will have 101,018,566 shares of common stock outstanding, assuming no exercise of options after December 31, 2001 and assuming the issuance of 46,374,804 shares of common stock issuable upon conversion of the Series A Preferred Stock and exercise of the warrants covered by this prospectus. Of this amount, 81,450,503 shares, including the 46,374,804 shares offered by this prospectus, will be freely tradable without restriction in the public market unless purchased by our “affiliates” as that term is defined in Rule 144 under the Securities Act. Any shares purchased by an affiliate may not be resold except pursuant to an effective registration statement or an applicable exemption from registration, including an exemption under Rule 144 of the Securities Act.

      In general, under Rule 144 as currently in effect, a person who has beneficially owned shares for at least one year is entitled to sell, within any three-month period, a number of shares that does not exceed the greater of:

•  1% of the then outstanding shares of common stock, which will be approximately 1,010,186 shares upon completion of this offering; or

•  the average weekly trading volume during the four calendar weeks preceding the sale.

      A person who is not deemed to have been an affiliate of ours at any time during the 90 days immediately preceding the sale and who has beneficially owned his, her or its shares for at least two years is entitled to sell his, her or its shares under Rule 144(k) without regard to the volume limitations described above. Persons deemed to be affiliates are subject to the volume limitations, even after the applicable holding periods have been satisfied. We are unable to estimate the number of our common shares that may be sold under Rule 144 because this will depend on the market price for our common stock, the personal circumstances of the sellers and other factors. Any future sale of substantial amounts of our common stock in the open market may adversely affect the market price of our common stock.

      At December 31, 2001, options to purchase 9,136,874 shares of our common stock were outstanding under out stock option plans, 3,831,044 of which were exercisable. Of these shares, 681,119 shares are issuable upon exercise of options held by non-affiliates and may be resold without restriction pursuant to our effective registration statement on Form S-8.

      Also, as of December 31, 2001, approximately 10,804,593 shares of common stock were issuable upon exercise of presently outstanding warrants. These shares are entitled to certain registration rights, and upon the effectiveness of an applicable registration statement, would be eligible for resale without restriction. Until a registration statement covering these shares is effective, these shares of common stock would be tradable subject to the holding period restrictions under, and compliance with the other requirements of, Rule 144 discussed above.

      No predictions can be made as to the effect that sales of common stock under Rule 144, pursuant to a registration statement or otherwise, or the availability of shares of common stock for sale, will have on the market price prevailing from time to time. Sales of substantial amounts of common stock in the public market, or the perception that these sales could occur, could adversely affect prevailing market prices and could impair our future ability to raise capital through an offering of our equity securities. See “Risk Factors.”

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SELLING STOCKHOLDERS

      The following table sets forth information with respect to each selling stockholder’s beneficial ownership of our common stock as of December 31, 2001 and as adjusted to reflect the sale of common stock offered by this prospectus. Except as otherwise indicated, to our knowledge, all persons listed below have sole voting and investment power with respect to their securities, except to the extent that authority is shared by spouses under applicable law or as otherwise noted below. The information in the table concerning the selling stockholders who may offer common stock under this prospectus from time to time is based on information provided to us by these securityholders, except for the conversion price of shares of Series A Preferred Stock into common stock and the exercise ratio of the Investor Warrants. Information concerning these selling stockholders may change from time to time and any changes of which we are advised will be set forth in a prospectus supplement to the extent required. See “Plan of Distribution.”

      Each stockholder’s percentage ownership in the following table is based on 54,643,762 shares of common stock issued and outstanding as of December 31, 2001. For purposes of calculating each stockholder’s percentage ownership, all options and warrants exercisable on or before March 1, 2002 held by the particular stockholder are treated as outstanding shares, but are not deemed outstanding for purposes of computing the percentage ownership of any other person. Beneficial ownership is determined in accordance with the rules of the SEC and includes voting and investment power with respect to shares.

	Shares of
	Common Stock
	Beneficially		Shares of		Shares of Common Stock
	Owned Prior to		Common Stock		Beneficially Owned
	this Offering		Being Offered		After this Offering
Selling Stockholder	Number		Number		Number		Percentage
Aether Capital LLC(1)		9,238,845		5,064,933		4,173,912		7.54%
Alpha Capital AG		422,077		422,077		*		*
Bank of Montreal Capital Corp.(2)		5,635,460		1,688,312		3,947,148		7.09
Cornerstone Equity Investors IV, L.P.(3)		12,583,230		5,064,933		7,518,297		13.45
GMN Investors II, L.P.		2,982,152		1,266,233		1,715,919		3.12
Louis, Robin		140,865		42,207		98,658		*
The Lynch Foundation		658,441		658,441		*		*
Peter S. Lynch and Carolyn A. Lynch JROS		604,416		604,416		*		*
Lynch Children’s Trust FBO Anne Lynch		79,350		79,350		*		*
Lynch Children’s Trust FBO Elizabeth Lynch		79,350		79,350		*		*
Lynch Children’s Trust FBO Mary Lynch		79,349		79,349		*		*
Peter S. Lynch Charitable Lead Annuity Trust		38,831		38,831		*		*
Peter S. Lynch Charitable Trust		38,831		38,831		*		*
Peter and Carolyn Lynch Charitable Remainder Trust		278,570		278,570		*		*
Major, John E.(4)		2,173,968		422,077		1,751,891		3.11
Marco Polo Industries Co. Ltd.(5)		3,854,606		650,000		3,204,606		5.81
McCabe, Anne E.		67,532		67,532		*		*
McCabe, George F.		126,623		126,623		*		*
Millet, David F.		253,246		253,246		*		*
Mitgang, Michael		132,439		84,415		48,024		*
Newton, Sarah B.		168,831		168,831		*		*
Pequot Navigator Offshore Fund Inc.		844,155		844,155		*		*
Pequot Scout Fund L.P.		1,688,311		1,688,311		*		*
Pilot Ventures Trust		422,077		422,077		*		*

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	Shares of
	Common Stock
	Beneficially		Shares of		Shares of Common Stock
	Owned Prior to		Common Stock		Beneficially Owned
	this Offering		Being Offered		After this Offering
Selling Stockholder	Number		Number		Number		Percentage
Randolph Street Partners III — Tranche C		131,726		75,973		55,755		*
Randolph Street Partners 1998 DIF, LLC		155,688		50,649		105,039		*
RS Emerging Growth Pacific Partners Master Fund Unit Trust		4,322,078		4,322,078		*		*
RS Emerging Growth Pacific Partners Onshore L.P.		199,219		199,219		*		*
RS Emerging Growth Partners L.P.		97,921		97,921		*		*
RS Emerging Growth Premium Partners L.P.		449,090		449,090		*		*
The RS Information Age Fund		2,161,038		2,161,038		*		*
RS Internet Age Fund		1,215,584		1,215,584		*		*
Silicon Valley Bank		500,000		500,000		*		*
Special Situations Cayman Fund L.P.		1,750,519		1,730,519		*		*
Special Situations Fund III L.P.		5,191,558		5,191,558		*		*
Special Situations Private Equity Fund L.P.		2,363,635		2,363,635		*		*
Special Situations Technology Fund L.P.		1,688,311		1,688,311		*		*
Triton West Group, Inc.		3,376,622		3,376,622		*		*
Ventures West Investments Ltd.(2)		845,326		253,246		592,080		1.08
WEC Asset Management LLC		1,689,311		1,688,311		*		*
Wireless Equities		844,155		844,155		*		*
Znaimer, Sam(2)		112,696		33,766		78,930		*

*	Represents less than 1.0% of the outstanding Common Stock.
(1)	David S. Oros, one of Novatel’s directors, serves as Chairman, Chief Executive Officer and President of Aether Systems, Inc., which is the sole member of Aether Capital, LLC, the record holder of these securities. Mr. Oros holds voting and investment control over these securities and disclaims beneficial ownership of these securities except to the extent of his pecuniary interest.
(2)	Bank of Montreal Capital Corporation and Ventures West Investments Limited are both controlled by Ventures West Capital Ltd. Sam Znaimer, one of Novatel’s former directors, is a senior vice president and a member of the board of directors of Ventures West Capital Ltd.
(3)	Robert Getz and Mark Rossi, two of Novatel’s directors, are each a Managing Director of Cornerstone Equity Investors, LLC. Cornerstone Equity Investors IV, L.P., the record holder of these securities, is an investment fund whose managing general partner is Cornerstone Equity Investors, LLC. Mr. Getz and Mr. Rossi hold voting and investment control over these securities and each disclaims beneficial ownership of these securities except to the extent of his respective pecuniary interest.
(4)	John E. Major is the Chairman of the board of directors and Chief Executive Officer of Novatel.
(5)	Horst Pudwill, one of our former directors, owns a limited partnership interest in Marco Polo Industries Co., Ltd., an investment firm. Mr. Pudwill holds voting and investment control over these securities and disclaims beneficial ownership of these securities except to the extent of his pecuniary interest.

DESCRIPTION OF CAPITAL STOCK

      Our certificate of incorporation authorizes the issuance of 365,000,000 shares of capital stock, of which 350,000,000 shares are designated as common stock, par value $.001 per share, and 15,000,000 shares are designated as Preferred Stock, 30,000 of which have been designated as Series A Preferred Stock. As of

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December 31, 2001, 54,643,762 shares of common stock (net of treasury shares) were issued and outstanding and 27,712 shares of Series A Preferred Stock were issued and outstanding.

Common Stock

      Holders of common stock are entitled to one vote for each share held of record on each matter submitted to a vote of stockholders. Subject to preferences that may be applicable to any outstanding preferred stock, holders of common stock are entitled to receive ratably dividends as may be declared by our Board of Directors from funds legally available for that purpose. In the event of a liquidation, dissolution or winding up, the holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities and subject to the prior distribution rights of any outstanding preferred stock. Our common stock carries no preemptive or conversion rights or other subscription rights and there are no redemption or sinking fund provisions applicable to it.

      Section 2115 of the California Corporations Code (the “California Law”) provides that a corporation incorporated in a state other than California (such as our company, which is incorporated in Delaware) may nevertheless be subject to certain of the provisions of the California Law (as specified in Section 2115 of the California Law) applicable to California corporations (commonly designated a “Quasi-California Corporation”) if more than one-half of its outstanding voting securities are owned of record by persons having addresses in California and more than half of its business is conducted in California (generally, if the average of its property factor, payroll factor and sales factor (as defined in Sections 25129, 25132 and 25134 of the California Revenue and Taxation Code) is more than 50 percent during its latest full income year). However, a foreign corporation will not be treated as a Quasi-California Corporation if it has outstanding securities designated as qualified for trading on The Nasdaq Stock Market or any successor thereto. Our common stock is qualified to trade on The Nasdaq Stock Market, and thus Section 2115 is not presently applicable to us.

Preferred Stock

      Our board of directors, without the approval of the holders of the common stock, is authorized to designate for issuance up to 15,000,000 shares of preferred stock, in any series and with any rights, privileges and preferences as our board of directors may from time to time determine. As of the date of this prospectus, 30,000 of these shares have been designated as Series A Preferred Stock, 27,172 of which are issued and outstanding.

      Series A Preferred Stock. Each share of Series A Preferred Stock is entitled to receive cumulative dividends, payable commencing as of the date of issuance and thereafter quarterly on January 1, April 1, July 1 and October 1 of each year, when and as declared by our board of directors at the initial rate of 8.0% per annum, compounded quarterly, of the purchase price paid per share of Series A Preferred Stock in preference to any payment made on any shares of common stock. However, the dividend rate on the Series A Preferred Stock will be reduced to the rate of 6.5% per annum following stockholder approval of the issuance of Series A Preferred Stock and Investor Warrants (the “2001 Private Placement Issuances”), if obtained. In addition, each share of Series A Preferred Stock will share in all ordinary dividends or distributions, except for liquidating distributions, declared or paid on the common stock on an as-converted basis. Each share of Series A Preferred Stock is also entitled to a liquidation preference of $1,000.00 per share (the “Liquidation Preference”), plus any accrued but unpaid dividends, in preference to any other class or series of our capital stock.

      The Series A Preferred Stock will be convertible, at the option of the holder at any time, into the number of shares of common stock as is determined by dividing the Liquidation Preference plus an amount equal to all accrued and unpaid dividends by the “conversion price,” which is initially $0.77 per share of common stock, as may be adjusted from time to time as a result of stock dividends, distributions payable in common stock, stock splits, reverse stock splits, recapitalizations, reclassifications, combinations or exchanges of shares, separations, reorganizations, liquidations or the like. Following any of the events listed in the previous sentence, the conversion price and the number of shares of common stock issuable upon conversion of the Series A

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Preferred Stock in effect immediately prior to those events will, concurrently with the effectiveness of those events, be proportionately decreased or increased, as appropriate.

      If we declare or pay a dividend or other distribution to holders of common stock payable in securities other than common stock, the holders of Series A Preferred Stock will receive upon conversion, in addition to the entitled number of shares of common stock, the amount of securities they would have received had they converted prior to the dividend or distribution. Similarly, if the common stock issuable upon conversion of the Series A Preferred Stock is changed into the same or a different number of shares of any class or classes of stock by capital reorganization, reclassification, or otherwise, the holders of the Series A Preferred Stock will receive upon conversion the securities they would have received had they converted prior to the reorganization or reclassification. Further, if we sell substantially all of our assets or merge or consolidate with or into another entity, the Series A Preferred Stock will be convertible into the kind and amount of shares of stock or other securities or property to which a holder of the number of shares of common stock deliverable upon conversion of Series A Preferred Stock would have been entitled to receive upon sale, consolidation or merger based on the Conversion Price, effective during the sale, consolidation or merger.

      Notwithstanding the foregoing, if stockholder approval is not obtained for the 2001 Private Placement Issuances, the aggregate number of shares of common stock issuable upon conversion of the Series A Preferred Stock and exercise of the Investor Warrants will be limited under our listing agreement with The Nasdaq Stock Market. If this occurs, we will be permitted to issue only up to an aggregate of approximately 10,869,000 shares of common stock upon conversion of shares of Series A Preferred Stock and exercise of the Investor Warrants (the “Nasdaq Cap”).

      On or at any time following the earliest of:

•  the sale or merger of our company wherein a change of control occurs,

•  December 21, 2008; and

•  (A) the 30th day following the day we may first distribute definitive proxy statements to stockholders under Rule 14a-6 of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), if the SEC does not review our preliminary proxy statement, or (B) the 90th day following the notification by the SEC of its review of our preliminary proxy statement, if stockholder approval of the 2001 Private Placement Issuances is not obtained by the applicable date,

then each holder of Series A Preferred Stock may elect to have us redeem any outstanding shares of Series A Preferred Stock, to the extent we have funds legally available for the redemption, and in the case of the events described in the third bullet above, to the extent that the shares of Series A Preferred Stock could not then be converted into shares of common stock under the Nasdaq Cap. If funds are then legally available, the redeeming holder of Series A Preferred Stock will receive an amount equal to:

•  the number of shares of Series A Preferred Stock submitted for redemption multiplied by

•  the Liquidation Preference plus all accrued but unpaid dividends thereon, through the date of redemption, whether or not declared.

However, a holder of Series A Preferred Stock will not be entitled to redemption as a result of a sale or merger if the change of control results from the acquisition by that holder of Series A Preferred Stock or that holder’s affiliates of beneficial ownership of our securities representing more than 50% of the voting power.

      We may elect to redeem, in whole or in part, outstanding shares of the Series A Preferred Stock on a pro rata basis among the holders of the Series A Preferred Stock at a redemption price per share equal to the Liquidation Preference plus all accrued but unpaid dividends thereon, provided that:

•  the registration statement of which this prospectus is a part is effective;

•  the average of the closing prices of the common stock as reported by The Nasdaq Stock Market over the 20 consecutive trading-day period ending not more than five business days prior to our notice of

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	redemption is greater than or equal to the product of (x) the Series A Conversion Price in effect on the last day of the 20 consecutive trading-day period and (y) 2.50; and
•	during the period beginning on the date of our notice of redemption and ending on the redemption date:

•  we have not received any request from the SEC or any other federal or state governmental authority for amendments or supplements to the registration statement or this prospectus or for additional information;

•  no stop order suspending the effectiveness of the registration statement or the initiation of any proceedings for that purpose has been issued by the SEC or any other federal or state governmental authority;

•  we have not received any notification with respect to the suspension of the qualification or exemption from qualification of the common stock for sale in any jurisdiction or the initiation of any proceeding for that purpose; and

•  there has not occurred any event or circumstance which would necessitate the making of any changes in the registration statement or this prospectus, or any document incorporated or deemed to be incorporated therein or herein by reference, so that, in the case of the registration statement, it does not contain any untrue statement of a material fact or any omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and that in the case of this prospectus, it does not contain any untrue statement of a material fact or any omission to state a material fact required to be stated or necessary to make the statements, in the light of the circumstances under which they were made, not misleading.

      The holders of Series A Preferred Stock will be entitled to notice of any meeting of our stockholders and will vote together with the holders of common stock as a single class upon any matter submitted to the stockholders for a vote, on an as-converted basis as of the record date of the vote or upon the date of the written consent. Notwithstanding the foregoing, the voting power of holders of the Series A Preferred Stock will be limited until we have obtained stockholder approval. If stockholder consent is not obtained, each holder of shares of Series A Preferred Stock will have that number of votes equal to the product of:

•  the number of whole shares of common stock into which each of the share of Series A Preferred Stock could be converted as of the record date of the vote or upon the date of the written consent is convertible and

•  a fraction, the numerator of which is equal to the Nasdaq Cap less the sum of (A) the total number of shares of common stock issued to date upon conversion and (B) the total number of shares of common stock issued to date upon exercise of the Investor Warrants, and the denominator of which is equal to the total number of shares of common stock issuable upon conversion of all shares of Series A Preferred Stock originally issued.

      The holders of Series A Preferred Stock will also have a right to participate in our future issuances of any shares of capital stock or securities convertible into or exercisable for any shares of, any class of our capital stock, subject to certain limitations and exceptions.

Warrants

      As of December 31, 2001, there were warrants outstanding to purchase a total of 21,391,086 shares of common stock, comprised of the Investor Warrants and warrants from previous private placement transactions.

      Investor Warrants. Each Investor Warrant has an initial exercise price of $1.20 per share (the “Warrant Exercise Price”), and will be exercisable in whole or in part prior to December 21, 2005. The number of shares of common stock issuable upon exercise of the Investor Warrants will be subject to the Nasdaq Cap until the 2001 Private Placement Issuances are approved by the stockholders. If the number of shares of outstanding common stock changes after the 2001 Private Placement by reason of stock dividends, distributions payable in

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common stock, stock splits, reverse stock splits, recapitalizations, reclassifications, combinations or exchanges of shares, separations, reorganizations, liquidations or the like, the Warrant Exercise Price and the number of shares of common stock issuable upon exercise of each Investor Warrant in effect immediately prior to the deemed issuance will, concurrently with the effectiveness of the deemed issuance, be proportionately decreased or increased, as appropriate. The holders of the Investor Warrants will not be entitled to any voting rights or any other rights as a stockholder until the Investor Warrant is duly exercised into shares of common stock.

      If we declare or pay a dividend or other distribution to holders of common stock payable in securities other than common stock, the holders of the Investor Warrants will receive upon exercise, in addition to the entitled number of shares of common stock, the amount of securities they would have received had they exercised prior to the dividend or distribution. Similarly, if the common stock issuable upon exercise of the Investor Warrants is changed into the same or a different number of shares of any class or classes of stock by capital reorganization, reclassification, or otherwise, the holders of the Investor Warrants will receive upon exercise the securities they would have received had they exercised their Investor Warrants prior to the reorganization or reclassification. Further, if we sell substantially all of our assets or merge or consolidate with or into another entity, the Investor Warrants will be exercisable into the kind and amount of shares of stock or other securities or property to which a holder of the number of shares of common stock deliverable upon exercise of the Investor Warrants would have been entitled to receive upon the sale, merger or consolidation based on the applicable Warrant Exercise Price, effective with respect to the sale, merger or consolidation.

      Notwithstanding the foregoing, unless and until stockholder approval is obtained for the 2001 Private Placement Issuances, the shares of common stock issuable upon exercise of the Investor Warrants will be subject to the Nasdaq Cap, and we will be permitted to issue only up to an aggregate of approximately 10,869,000 shares of common stock upon conversion of the Series A Preferred Stock and exercise of the Investor Warrants.

      We may require the warrant holder to exercise the Investor Warrants provided that:

•  the registration statement of which this prospectus is a part is effective;

•  the average closing price of our common stock as reported by The Nasdaq Stock Market over the 20 consecutive trading-day period ending not more than five business days prior to our notice of exercise is greater than or equal to the product of (x) the Warrant Exercise Price in effect on the last day of the 20 consecutive trading-day period and (y) 2.00; and

•  during the period beginning on the date of our notice to exercise and ending on the exercise date:

•  we have not received any request from the SEC or any other federal or state governmental authority for amendments or supplements to the registration statement or this prospectus or for additional information;

•  no stop order suspending the effectiveness of the registration statement or the initiation of any proceedings for that purpose has been issued by the SEC or any other federal or state governmental authority;

•  we have not received any notification with respect to the suspension of the qualification or exemption from qualification of the common stock for sale in any jurisdiction or the initiation of any proceeding for that purpose; and

•  there has not occurred any event or circumstance which would necessitate the making of any changes in the registration statement or this prospectus, or any document incorporated or deemed to be incorporated therein or herein by reference, so that, in the case of the registration statement, it does not contain any untrue statement of a material fact or any omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and that in this case of this prospectus, it does not contain any untrue statement of a material fact or any omission to state a material fact required to be stated necessary to make the statements herein, in the light of the circumstances under which they were made, not misleading.

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      Warrants from Previous Private Placements. As of December 31, 2001, there were warrants outstanding to purchase a total of 10,804,593 shares of common stock. Generally, each warrant contains provisions for the adjustment of its exercise price and the number of shares issuable upon its exercise upon the occurrence of any stock dividend, stock split, reorganization, reclassification, consolidation and certain dilutive issuances of securities at prices below the then existing applicable warrant exercise price. In addition, the shares of common stock issuable upon any exercise of the warrants provide their holders with rights to have those shares registered and qualified under federal and state securities laws. Some of these warrants have net exercise provisions under which the holder may, in lieu of payment of the exercise price in cash, surrender the warrant and receive a net amount of shares based on the fair market value of common stock at the time of exercise of the warrant after deduction of the aggregate exercise price.

Options

      As of December 31, 2001, there were options issued under our stock option plans outstanding to purchase an aggregate of approximately 9,136,874 shares of common stock at a weighted average exercise price of $4.93.

DELAWARE LAW AND LIMITATIONS ON CHANGES IN CONTROL

      Certain provisions of Delaware law and our amended and restated certificate of incorporation and bylaws could make it more difficult for a third party to acquire us through a tender offer, a proxy contest or otherwise and the removal of incumbent officers and directors. These provisions are expected to discourage certain types of coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire control of us to negotiate with us first. We believe that the benefits of increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh the disadvantages of discouraging such proposal because, among other things, negotiation of such proposals could result in an improvement of their terms.

      Our amended and restated certificate of incorporation authorizes our board to establish one or more series of undesignated preferred stock, the terms of which can be determined by our board at the time of issuance without the need for stockholder approval. Our amended and restated certificate of incorporation also provides that stockholder action can be taken only at an annual or special meeting of stockholders and may not be taken by written consent. In addition, our bylaws provide that special meetings of stockholders can be called only by our board of directors, the chairman of our board or our chief executive officer, but do not permit our stockholders to call a special meeting of stockholders. Our amended and restated certificate of incorporation also provides that our board of directors is divided into three classes, with each director assigned to a class with a term of three years. Our bylaws establish an advance notice procedure with regard to stockholder proposals and the nomination of candidates for election of directors other than by or at the direction of our board of director.

      We are subject to Section 203 of the Delaware General Corporation Law, which includes anti-takeover provisions. In general, Section 203 prohibits a publicly-held Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date that the person became an interested stockholder unless, subject to exceptions, the business combination or the transaction in which the person became an interested stockholder is approved in a prescribed manner. Generally, a “business combination” includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. Generally, an “interested stockholder” is a person who, together with affiliates and associates, owns, or within three years prior to the determination of interested stockholder status, did own, 15% or more of the corporation’s voting stock. These provisions may have an anti-takeover effect, including discouraging attempts that might result in the payment of a premium over the market price for the shares of common stock held by stockholders, or delaying, deferring or preventing a change in control without further action by the stockholders.

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TRANSFER AGENT AND REGISTRAR

      The transfer agent and registrar for the common stock and the Series A Preferred Stock is U.S. Stock Transfer Corporation. The transfer agent’s address and telephone number is 1745 Gardena Avenue, Glendale, California 91204, (818) 502-1404.

PLAN OF DISTRIBUTION

      The selling stockholders named herein (or by pledgees, donees, transferees or other successors-in-interest, selling shares received from a named selling shareholder as a gift, partnership, distribution or other non-sale-related transfer after the date of this prospectus) may offer the shares from time to time in one or more transactions (which may involve crosses or block transactions):

•  on any stock exchange, in The Nasdaq Stock Market, or in the over-the-counter market;

•  in transactions otherwise than on any stock exchange or in the over-the-counter market; or

•  through the writing of options (whether the options are listed on an options exchange or otherwise) on, or settlement of short sales of, the common stock.

Any of these transactions may be effected at market prices prevailing at the time of sale, at prices related to the prevailing market prices, at varying prices determined at the time of sale or at negotiated or fixed prices, in each case as determined by the selling stockholder or by agreement between the selling stockholder and underwriters, brokers, dealers or agents, or purchasers. If the selling stockholders effect these transactions by selling common stock to or through underwriters, brokers, dealers or agents, those underwriters, brokers, dealers or agents may receive compensation in the form of discounts, concessions or commissions from the selling stockholders or commissions from purchaser of common stock for whom they may act as agent (which discounts, concessions or commissions as to particular underwriters, brokers, dealers or agents may be in excess of those customary in the types of transactions involved). The selling stockholders and any brokers, dealers or agents that participate in the distribution of the common stock may be deemed to be underwriters, and any profit on the sale of common stock by them and any discounts, concessions or commissions received by any of these underwriters, brokers, dealers or agents may be deemed to be underwriting discounts and commissions under the Securities Act.

      Under the securities laws of certain states, the common stock may be sold in these states only through registered or licensed brokers or dealers. In addition, in certain states the common stock may not be sold unless the common stock has been registered or qualified for sale in the state or an exemption from registration or qualification is available and is complied with.

      We will pay all of the expenses incident to the registration, offering and sale of the common stock to the public hereunder other than commissions, fees and discounts of underwriters, brokers, dealers and agents. We have agreed to indemnify the selling stockholders and their controlling persons against certain liabilities, including liabilities under the Securities Act. We estimate that the expenses of the offering to be borne by us will be approximately $70,000. We will not receive any proceeds from the sale of any of the common stock by the selling stockholders.

      U.S. Bancorp Piper Jaffray, Inc., acted as placement agent in connection with the placement of the Series A Preferred Stock which has been or will be converted into the common stock offered hereby, and it received a fee in connection therewith.

      We have informed the selling stockholders that the anti-manipulation provisions of Regulation M under the Exchange Act may apply to purchases and sales of common stock by the selling stockholders, and that there are restrictions on market-making activities by persons engaged in the distribution of the common stock. We have also advised the selling stockholders that if a particular offer of common stock is to be made on terms constituting a material change from the information set forth above with respect to the Plan of Distribution, then to the extent required, a prospectus supplement must be distributed setting forth the terms and related information as required.

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LEGAL MATTERS

      The validity of the shares of common stock offered hereby has been passed upon by Latham & Watkins, Los Angeles, California.

EXPERTS

      The financial statements and schedules incorporated by reference in this prospectus and elsewhere in the registration statement, to the extent and for the periods indicated in their report have been audited by Arthur Andersen LLP independent public accountants, and are included in reliance upon the authority of said firm as experts in giving said report.

WHERE YOU CAN FIND MORE INFORMATION

      We file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any reports, statements or other information filed by us at the SEC’s public reference room at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and in New York, New York. Copies of this material can also be obtained from the Public Reference Section of the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549, and its public reference rooms in New York, New York, at prescribed rates. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. Copies of this information may also be inspected at the reading room of the library of the National Association of Securities Dealers, Inc., 1734 K Street, N.W., Washington, D.C. 20006. Our filings with the SEC are also available to the public from commercial document retrieval services and at the SEC’s web site at “http://www.sec.gov.”

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

      You should not rely on forward-looking statements in this prospectus. This prospectus contains forward-looking statements that relate to future events or to our future business or performance. In some cases, you can identify forward-looking statements by words such as “anticipates,” “believes,” “plans,” “expects,” “future,” “intends,” “may,” “will,” “should,” “estimates,” “predicts,” “potential,” “continue” and other similar expressions. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed in “Risk Factors” and elsewhere in this prospectus. This prospectus also contains forward-looking statements attributed to third parties relating to their estimates regarding the growth of our markets. Forward-looking statements are subject to known and unknown risks, assumptions, limitations, uncertainties and other factors that may cause our actual results, as well as those of the markets we serve, levels of activity, performance, achievements and prospects to be materially different from those expressed or implied by the forward-looking statements. These risks, uncertainties and factors include, among others, those identified in “Risk Factors” and elsewhere in this prospectus. Except as required by law, we undertake no obligation to update publicly any forward-looking statement for any reason, even if new information becomes available or other events occur.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

      The SEC allows us to “incorporate by reference” the information we filed with them, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be part of this prospectus, and information that we file later with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any future filings we will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act until the selling stockholders sell all the shares of common stock offered by this prospectus.

•  our annual report on Form 10-K for the fiscal year ended December 31, 2000;

•  our current report on Form 8-K, filed on January 18, 2002; and

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•  our quarterly reports on Form 10-Q for the quarters ended March 31, 2001, June 30, 2001 and September 30, 2001.

      We have also filed a registration statement on Form S-3 with the Securities and Exchange Commission under the Securities Act that registers the shares we are offering. This prospectus does not contain all of the information set forth in the registration statement. You should read the registration statement for further information about us and our common stock.

      We will furnish without charge to you, upon written or oral request, a copy of any or all of the documents described above, except for exhibits to those documents, unless the exhibits are specifically incorporated by reference into those documents. Requests should be addressed to:

Corporate Secretary

Novatel Wireless, Inc.

9360 Towne Centre Drive, Suite 110

San Diego, California 92121

telephone number (858) 320-8800.

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14.     Other Expenses of Issuance and Distribution.

      The following table sets forth the fees and expenses in connection with the issuance and distribution of the securities being registered hereunder. We will pay all of the costs identified below. Except for the SEC registration fee, all amounts are estimates.

		Amount to be Paid
SEC Registration Fee			4,480
Printing and Engraving Expenses			10,000
Accountants’ Fees and Expenses			25,000
Legal Fees and Expenses			25,000
Miscellaneous Expenses			5,520
	Total	$	70,000

Item 15.     Indemnification of Directors and Officers.

      Section 145 of the Delaware General Corporation Law authorizes a court to award, or a corporation’s board of directors to grant, indemnification to directors and officers in terms sufficiently broad to permit such indemnification under some circumstances for liabilities (including reimbursement for expenses incurred) arising under the Securities Act of 1933, as amended (the “Securities Act”). Article XIV of our amended and restated certificate of incorporation and Article VI of our bylaws provide for indemnification of our directors, offices, employees and other agents to the maximum extent permitted by Delaware law. In addition, we have entered into Indemnification Agreements with our officers and directors. Our amended and restated certificate of incorporation provides that subject to Delaware law, our directors will not be personally liable for monetary damages awarded as a result of a breach of their fiduciary duty owed to Novatel Wireless, Inc. and its stockholders. This provision does not eliminate our directors fiduciary duty and in appropriate circumstances equitable remedies such as injunctive or other forms of non-monetary relief will remain available under Delaware law.

Item 16.     Exhibits and Financial Statement Schedules.

Exhibit
Number		Description
	4.1	Form of Common Stock Purchase Warrant issued in connection with the Company’s Series B Convertible Preferred Stock
	4.2	Form of Common Stock Purchase Warrant issued in connection with the Company’s Series C Convertible Preferred Stock
	4.3	Form of Common Stock Purchase Warrant issued in connection with the Company’s Series C Debentures
	4.4	Form of Common Stock Purchase Warrant issued in connection with the Company’s Series D Convertible Preferred Stock
	4.5	Warrant to Purchase Stock, dated as of November 29, 2001, by and between the Company and Silicon Valley Bank
	5.1	Form of Opinion of Latham & Watkins regarding legality
	10.1	Loan and Security Agreement, dated as of November 29, 2001, by and between the Company and Silicon Valley Bank

II-1

Exhibit
Number		Description
	10.2	The Registration Rights Agreement, dated as of November 29, 2001, by and between the Company and Silicon Valley Bank
	23.1	Consent of Latham & Watkins (included in Exhibit 5.1)
	23.2	Consent of Arthur Andersen LLP
	24.1	Power of Attorney (included on signature page)

Item 17.     Undertakings.

      The undersigned registrant hereby undertakes:

      (i) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration amendment:

•  to include any prospectus required by Section 10(a)(3) of the Securities Act;

•  to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment) which, individually or in the aggregate, would be a fundamental change in the information in the registration statement; and

•  to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to the information in the registration statement.

      (ii) That, for purposes of determining any liability under the Securities Act:

•  each of these post-effective amendments; and

•  each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (including each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement

will be deemed to be a new registration statement relating to the securities offered by this prospectus, and the offering of these securities at that time will be deemed to be the initial bona offering.

      (iii) To remove from registration any of the securities being registered which remain unsold at the termination of the offering, using a post-effective amendment.

      To the extent that indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described under Item 15 above, or otherwise, the registrant has been advised that in the SEC’s opinion, this indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. If a claim for indemnification against these liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by a director, officer or controlling person of the registrant in connection with these securities, the registrant will submit to a court of appropriate jurisdiction the question of whether indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of this issue, unless its counsel advises it that the issue has been settled by controlling precedent.

II-2

SIGNATURES

      Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Diego, State of California, as of the 18th day of January, 2002.

NOVATEL WIRELESS, INC.

By:  /s/ MELVIN L. FLOWERS

Melvin L. Flowers

Senior Vice President, Finance,

Chief Financial Officer and Secretary

POWER OF ATTORNEY

      Each director and/or officer of the registrant whose signature appears below hereby appoints John E. Major and Melvin L. Flowers, and both of them severally, as his true and lawful attorney-in-fact and agent, to sign in his name and behalf, in any and all capacities stated below, and to file with the Securities and Exchange Commission, any and all amendment, including post-effective amendments and any registration statement for the same offering that is to be effective under Rule 462(b) of the Securities Act, to this registration statement, and the registrant hereby also appoints each such person as its attorney-in-fact and agent with like authority to sign and file any such amendments in its name and behalf.

      Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed below by the following persons in the capacities indicated on the 18th day of January, 2002.

Signature	Title
/s/ JOHN E. MAJOR John E. Major	Chairman and Chief Executive Officer
/s/ MELVIN L. FLOWERS Melvin L. Flowers	Senior Vice President, Finance and Chief Financial Officer and Secretary
Robert Getz	Director
/s/ PENG K. LIM Peng K. Lim	Director
/s/ DAVID S. OROS David S. Oros	Director
/s/ MARK ROSSI Mark Rossi	Director
/s/ STEVEN SHERMAN Steven Sherman	Director

II-3

NOVATEL WIRELESS, INC.

REGISTRATION STATEMENT ON FORM S-3

EXHIBIT INDEX

Exhibit
Number		Description
	4.1	Form of Common Stock Purchase Warrant issued in connection with the Company’s Series B Convertible Preferred Stock
	4.2	Form of Common Stock Purchase Warrant issued in connection with the Company’s Series C Convertible Preferred Stock
	4.3	Form of Common Stock Purchase Warrant issued in connection with the Company’s Series C Debentures
	4.4	Form of Common Stock Purchase Warrant issued in connection with the Company’s Series D Convertible Preferred Stock
	4.5	Warrant to Purchase Stock, dated as of November 29, 2001, by and between the Company and Silicon Valley Bank
	5.1	Form of Opinion of Latham & Watkins regarding legality
	10.1	Loan and Security Agreement, dated as of November 29, 2001, by and between the Company and Silicon Valley Bank
	10.2	The Registration Rights Agreement, dated as of November 29, 2001, by and between the Company and Silicon Valley Bank
	23.1	Consent of Latham & Watkins (included in Exhibit 5.1)
	23.2	Consent of Arthur Andersen LLP
	24.1	Power of Attorney (included on signature page)

EX-4.1

                                                                     Exhibit 4.1

THE WARRANT EVIDENCED HEREBY, AND THE SHARES OF COMMON STOCK ISSUABLE
HEREUNDER, HAVE BEEN AND WILL BE ISSUED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE APPLICABLE SECURITIES LAWS OF ANY
STATE. SUCH SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO
DISTRIBUTION OR RESALE, AND SHALL NOT BE SOLD, TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS THE PROPOSED DISPOSITION IS THE SUBJECT OF A CURRENTLY
EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT AND UNDER APPLICABLE STATE
SECURITIES LAWS OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN
FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT
SUCH REGISTRATION IS NOT REQUIRED UNDER SAID ACT AND SUCH STATE SECURITIES LAWS
IN CONNECTION WITH SUCH DISPOSITION.

                             NOVATEL WIRELESS, INC.

                          COMMON STOCK PURCHASE WARRANT

                             Void After_____, 2003

                    This Stock Purchase Warrant is Issued to

                      [INSERT NAME AND ADDRESS OF GRANTEE]

(hereinafter called the "initial registered holder" or the "registered holder,"
which term shall include its successors and assigns) by Novatel Wireless, Inc.,
a Delaware corporation (hereinafter referred to as the "Company"). The holder of
this Warrant is entitled to certain of the benefits conferred by that certain
Amended and Restated Series B Convertible Preferred Stock and Warrant Purchase
Agreement dated as of _______, 1998 (the "Purchase Agreement"), and that certain
Registration Rights Agreement, as amended, dated as of _______, 1997, as
amended (the "Registration Rights Agreement"), copies of which are on file at
the office of the Company at the address specified below. This Warrant may be
transferred by the registered holder only in accordance with the provisions of
Sections 1.04 and 5 hereof. A copy of the Purchase Agreement and the
Registration Rights Agreement will be furnished to any subsequent registered
holder hereof upon written request. The Registration Rights Agreement contains
an undertaking by the Company under certain circumstances to effect registration
and qualification under federal and state securities laws of, or to take other
action with respect to, the shares of Common Stock, par value $.001, of the
Company. ("Common Stock") issuable on exercise of this Warrant.




Section 1. The Warrant.

        1.01 For value received and subject to the terms and conditions
hereinafter set forth, the registered holder is entitled, upon surrender of this
Warrant at any time on or prior to April 24, 2003 (with the subscription form
annexed hereto duly executed) at the office of the Company at 4250 East
Camelback Road, Suite K115, Phoenix, AZ 85018, or such other office of which the
Company shall notify the registered holder hereof in writing, to purchase from
the Company ______________, fully paid and non-assessable shares ("Initial
Exercisable Shares" and, as adjusted, from time to time as hereinafter provided,
"Exercisable Shares") of Common Stock for an initial exercise price of $4.26 per
share as adjusted from time to time as provided below, (the "Warrant Exercise
Price"). This Warrant may be exercised in full or in part from time to time. As
promptly as practicable after surrender of this Warrant and receipt of payment
of the Warrant Exercise Price, the Company shall issue and deliver to the
registered holder a certificate or certificates for shares of Common Stock, in
certificates of such denominations and in such names as the registered holder
may specify, together with any other stock, securities or property to which such
holder may be entitled to receive pursuant to Sections 1.05(B), 1.05(C) or
1.05(D) hereof. In the case of the purchase of less than all the shares
purchasable under this Warrant, the Company shall cancel this Warrant upon the
surrender hereof and shall execute and deliver a substitute Warrant of like
tenor for the balance of the shares purchasable hereunder. This Warrant shall
expire at 8;00 P.M. (Eastern Standard Time) on _______, 2003 and shall be void
thereafter.

        1.02 During the period within which the rights represented by this
Warrant may be exercised, the Company shall at all times have authorized and
reserved for the purpose of issue upon exercise of the rights evidenced hereby,
a sufficient number of shares of its Common Stock to provide for the exercise of
such rights. Upon surrender for exercise, this Warrant shall be canceled and
shall not be reissued; provided, however, that upon the partial exercise hereof
a substitute Warrant representing the rights to subscribe for and purchase any
such unexercised portion hereof shall be issued.

        1.03 Subject to compliance with applicable securities laws, this Warrant
may be subdivided into one or more Common Stock Purchase Warrants entitling the
registered holder to purchase shares of Common Stock in multiples of one or more
whole shares, upon surrender of this Warrant by the registered holder for such
purpose at the office of the Company.

        1.04 The Company shall maintain at its office (or at such other office
or agency of the Company as it may from time to time designate in writing to the
registered holder hereof), a register containing the names and addresses of the
holders of all Stock Purchase Warrants. The registered holder of such a Warrant
shall be the person in whose name such Warrant is originally issued and
registered, unless a subsequent holder shall have presented to the Company such
Warrant, duly assigned to him, for inspection and a written notice of his
acquisition of such Warrant and designating in writing the address of such
holder, in which case such subsequent holder of the Warrant shall become a
subsequent registered holder. Any registered holder of this Warrant may change
his address as shown on such register by written


                                      -2-



notice to the Company requesting such change. Any written notice required or
permitted to be given to the registered holder of this Warrant shall be mailed,
by registered or certified mail, to such registered holder at his address as
shown on such register.

        1.05 The rights of the registered holder shall be subject to the
following terms and conditions:

               (A) Adjustments to the Warrant Exercise Price.

                      (i) Special Definitions. For purposes of this Subsection
1.05, the following definitions shall apply:

                             (1) "Option" shall mean rights, options or warrants
        to subscribe for, purchase or otherwise acquire either Common Stock or
        Convertible Securities.

                             (2) "Warrant Exercise Price" shall mean initially
        $4.26 per share and shall be subject to adjustment as hereinafter
        provided.

                             (3) "Original Issue Date" shall mean the date on
        which this Warrant was issued.

                             (4) "Stock Purchase Warrants" shall mean the
        Warrants sold by the Company pursuant to the Purchase Agreement.

                             (5) "Convertible Securities" shall mean any
        evidences of indebtedness, shares of capital stock (other than Common
        Stock) or other securities directly or indirectly convertible into or
        exchangeable for Common Stock.

                             (6) "Additional Shares of Common Stock" shall mean
        all shares of Common Stock issued (or, pursuant to Subsection
        1.05(A)(iii), deemed to be issued) by the Company after the Original
        Issue Date, other than:

                                     (a) up to 2,347,418 shares of the Company's
               Common Stock (appropriately adjusted to take account of any stock
               split, stock dividend, combination of shares or the like) to be
               issued upon conversion of the Company's Series B Convertible
               Preferred Stock ("Series B Preferred Stock"), assuming conversion
               of all of the outstanding shares of the Series B Preferred Stock
               of Novatel Wireless Technologies Ltd. ("NWT") into shares of the
               Series B Preferred Stock;

                                     (b) up to 3,515,655 shares of the Company's
               Common Stock (appropriately adjusted to take account of any stock
               split, stock dividend, combination of shares or the like) to be
               issued upon conversion of shares of the Company's Series A
               Preferred Stock, assuming conversion of all of the


                                      -3-



               outstanding shares of the Series A Preferred Stock of NWT into
               shares of the Series A Convertible Preferred Stock of the
               Company ("Series A Preferred Stock");

                                     (c) up to 800,176 shares of the Company's
               Common Stock to be issued upon exercise of warrants to purchase
               the Company's Common Stock granted by the Company;

                                     (d) up to 80,106 shares of the Company's
               Common Stock to be issued upon exchange of shares of the
               exchangeable common stock of NWT issued upon exercise of warrants
               to purchase such shares;

                                     (e) any minimum number of shares of capital
               stock required by law to be issued to directors of the Company;

                                     (f) up to 796,056 shares (appropriately
               adjusted to take account of any stock split, stock dividend,
               combination of shares or the like), or such higher number of
               shares as is recommended by the Compensation Committee of the
               Company's Board of Directors and approved by the Company's Board
               of Directors, of Common Stock (or related options) issued or
               issuable to officers, directors or employees of, or consultants
               to, the Company pursuant to a stock purchase or option or warrant
               plan or other similar arrangement approved by the Board of
               Directors;

                                     (g) any shares of capital stock, not to
               exceed one-half of one percent of the total issued and
               outstanding capital stock of the Company on an "as converted to
               Common Stock" basis, the issuance of which is approved by vote of
               a majority of the Board of Directors of the Company, including
               the affirmative vote of a majority of the directors designated
               for election by the holders of the Series A and Series B
               Preferred Stock; and

                                     (h) not more than ten shares of capital
               stock of the Company on an "as converted to Common Stock" basis,
               the issuance of which resulted from mathematical or other error
               or inadvertence, provided that the transaction in which such
               shares were issued was approved at the time by vote of a majority
               of the Board of Directors of the Company, including the
               affirmative vote of a majority of the directors designated for
               election by the holders of the Company's Series A and Series B
               Preferred Stock.

                      (ii) No Adjustment to Warrant Exercise Price. No
adjustment to the Warrant Exercise Price shall be made unless the consideration
per share for an Additional Share of Common Stock issued or deemed to be issued
by the Company is less than the Warrant Exercise Price in effect on the date of,
and immediately prior to, the issue of such Additional Share of Common Stock.


                                      -4-



                      (iii) Issue of Securities Deemed Issue of Additional
Shares of Common Stock.

                             (1) Options and Convertible Securities. In the
        event the Company at any time or from time to time after the Original
        Issue Date shall issue any Options or Convertible Securities or shall
        fix a record date for the determination of holders of any class of
        securities entitled to receive any such Options or Convertible
        Securities, then the maximum number of shares (as set forth in the
        instrument relating thereto without regard to any provisions contained
        therein for a subsequent adjustment of such number) of Common Stock
        issuable upon the exercise of such Options or, in the case of
        Convertible Securities and Options therefor, the conversion or exchange
        of such Convertible Securities, shall be deemed to be Additional Shares
        of Common Stock issued as of the time of such issue or, in case such a
        record date shall have been fixed, as of the close of business (Eastern
        Standard Time or Eastern Daylight Savings Time, if applicable) on such
        record date, provided that Additional Shares of Common Stock shall not
        be deemed to have been issued unless the consideration per share
        (determined pursuant to Subsection 1.05(A)(v) hereof) of such Additional
        Shares of Common Stock would be less than the Warrant Exercise Price in
        effect on the date of and immediately prior to such issue, or such
        record date, as the case may be, and provided further that in any such
        case in which Additional Shares of Common Stock are deemed to be issued:

                                     (a) no further adjustment in the Warrant
               Exercise Price shall be made upon the subsequent issue of
               Convertible Securities or shares of Common Stock upon the
               exercise of such Options or conversion or exchange of such
               Convertible Securities;

                                     (b) if such Options or Convertible
               Securities by their terms provide, with the passage of time or
               otherwise, for any increase in the Consideration as defined in
               Subsection 1.05(A)(v) payable to the Company, or decrease in the
               number of shares of Common Stock issuable, upon the exercise,
               conversion or exchange thereof, the Warrant Exercise Price
               computed upon the original issue thereof (or upon the occurrence
               of a record date with respect thereto), and any subsequent
               adjustments based thereon, shall, upon any such increase or
               decrease becoming effective, be recomputed to reflect such
               increase or decrease insofar as it affects such Options or the
               rights of conversion or exchange under such Convertible
               Securities;

                                     (c) upon the expiration of any such Options
               or any rights of conversion or exchange under such Convertible
               Securities which shall not have been exercised, the Warrant
               Exercise Price computed upon the original issue thereof (or upon
               the occurrence of a record date with respect thereto), and any
               subsequent adjustments based thereon, shall, upon such
               expiration, be recomputed as if:


                                      -5-



                                             (i) In the case of Convertible
               Securities or Options for Common Stock the only Additional Shares
               of Common Stock issued were the shares of Common Stock, if any,
               actually issued upon the exercise of such Options or the
               conversion or exchange of such Convertible Securities and the
               consideration received therefor was the consideration actually
               received by the Company for the issue of all such Options,
               whether or not exercised, plus the consideration actually
               received by the Company upon such exercise, or for the issue of
               all such Convertible Securities which were actually converted or
               exchanged, plus the additional consideration, if any, actually
               received by the Company upon such conversion or exchange; and

                                             (ii) in the case of Options for
               Convertible Securities only the Convertible Securities, if any,
               actually issued upon the exercise thereof were issued at the time
               of issue of such Options, and the consideration received by the
               Company for the Additional Shares of Common Stock deemed to have
               been then issued was the consideration actually received by the
               Company for the issue of all such Options, whether or not
               exercised, plus the consideration deemed to have been received by
               the Company (determined pursuant to Subsection 1.05(A)(v)) upon
               the issue of the Convertible Securities with respect to which
               such Options were actually exercised;

                                     (d) no readjustment pursuant to clause (b)
               or (c) above shall have the effect of increasing the Warrant
               Exercise Price to an amount which exceeds the lower of (i) the
               Warrant Exercise Price on the original adjustment date, or (ii)
               the Warrant Exercise Price that would have resulted from any
               issuance of Additional Shares of Common Stock between the
               original adjustment date and such readjustment date;

                                     (e) in the case of any Options which expire
               by their terms not more than thirty days after the date of issue
               thereof, no adjustment of the Warrant Exercise Price shall be
               made until the expiration or exercise of all such Options,
               whereupon such adjustment shall be made in the same manner
               provided in clause (c) above; and

                                     (f) if such record date shall have been
               fixed and such Options or Convertible Securities are not issued
               on the date fixed therefor, the adjustment previously made in the
               Warrant Exercise Price which became effective on such record date
               shall be canceled as of 8:00 P.M. Eastern Standard Time (or
               Eastern Daylight Savings Time if applicable) on such record date,
               and thereafter the Warrant Exercise Price shall be adjusted
               pursuant to this Subsection 1.05(A)(iii) as of the actual date of
               their issuance.

                      (2) Stock Dividends. Stock Distributions and Subdivisions.
        In the event the Company at any time or from time to time after the
        Original Issue Date


                                      -6-



        shall declare or pay any dividend or make any other distribution on the
        Common Stock payable in Common Stock or effect a subdivision of the
        outstanding shares of Common Stock (by reclassification or otherwise
        than by payment of a dividend in Common Stock), then and in any such
        event, Additional Shares of Common Stock shall be deemed to have been
        issued:

                                     (a) in the case of any such dividend or
               distribution, immediately after 8:00 P.M. (Eastern Standard Time
               on Eastern Daylight Savings Time, if applicable) on the record
               date for the determination of holders of any class of securities
               entitled to receive such dividend or distribution, or

                                     (b) in the case of any such subdivision, at
               8:00 P.M. (Eastern Standard Time or Eastern Daylight Savings
               Time, if applicable) on the date immediately prior to the date
               upon which such corporate action becomes effective.

               If such record date shall have been fixed and no part of such
               dividend shall have been paid on the date fixed therefor, the
               adjustment previously made in the Warrant Exercise Price which
               became effective on such record date shall be canceled as of
               8:00 P.M. (Eastern Standard Time or Eastern Daylight Savings
               time, if applicable) on such record date, and thereafter the
               Warrant Exercise Price shall be adjusted pursuant to this
               Section 1.05(A)(iii) as of the time of actual payment of such
               dividend.

                      (iv) Adjustment to the Warrant Exercise Price Upon
Issuance of Additional Shares of Common Stock. In the event that at any time or
from time to time after the Original Issue Date, the Company shall issue
Additional Shares of Common Stock (including, without limitation, Additional
Shares of Common Stock deemed to be issued pursuant to Subsection
1.05(A)(iii)(1) but excluding Additional Shares of Common Stock deemed to be
issued pursuant to Subsection 1.05A(iii)(2), which event is dealt with in
Subsection 1.05(A)(vi)(1)), without consideration or for a consideration per
share less than the applicable Warrant Exercise Price in effect on the date of
and immediately prior to such issue, then and in such event, such Warrant
Exercise Price shall be reduced concurrently with such issue, to a price equal
to the Consideration Per Share for which such Additional Shares of Common Stock
are issued or deemed to be issued; provided that the applicable Warrant Exercise
Price shall not be so reduced at any time if the amount of such reduction would
be an amount less than $.01, but any such amount shall be carried forward and
reduction with respect thereto made at the time of and together with any
subsequent reduction which, together with such amount and any other amount or
amounts so carried forward, shall aggregate $.01 or more.

                      (v) Determination of Consideration. For purposes of this
Subsection 1.05(A), the consideration (the "Consideration") received or
receivable by the Company for the issue of any Additional Shares of Common Stock
shall be computed as follows:


                                      -7-



                             (1) Cash and Property: Such Consideration shall:

                                     (a) insofar as it consists of cash, be
               computed at the aggregate amounts of cash received by the Company
               excluding amounts paid or payable for accrued interest or accrued
               dividends;

                                     (b) insofar as it consists of property
               other than cash, be computed at the fair value thereof at the
               time of such issue, as determined in good faith by the Board of
               Directors; and

                                     (c) in the event Additional Shares of
               Common Stock are issued together with other shares or securities
               or other assets of the Company for consideration which covers
               both, be the proportion of such consideration so received or
               receivable computed as provided in Subsections 1.05(A)(v)(1)(a)
               and 1.05(A)(v)(1)(b) above, allocable to such Additional Shares
               of Common Stock as determined in good faith by the Board of
               Directors; provided, however, that in the event warrants or other
               options to purchase shares of Common Stock are issued without
               consideration or for a nominal consideration contemporaneously
               with the issuance of debt or preferred stock, or both, then the
               consideration received by the Company for such debt or preferred
               stock shall be deemed properly allocated to the issuance of the
               warrants or options.

                      (2) Additional Shares of Common Stock other than Options
        and Convertible Securities. The Consideration per share (the
        "Consideration Per Share") for the issue of any Additional Shares of
        Common Stock other than Options and Convertible Securities shall be the
        Consideration for the issue of any Additional Shares of Common Stock
        other than Options or Convertible Securities, divided by the total
        number of such Additional Shares of Common Stock issued by the
        Corporation in exchange therefor.

                      (3) Options and Convertible Securities. The Consideration
        per share (also the "Consideration Per Share," as the context requires)
        for Additional Shares of Common Stock deemed to have been issued
        pursuant to Subsection 1.05(A)(iii)(1), relating to Options and
        Convertible Securities, shall be computed by dividing (x) the
        Consideration for the issue of such Options or Convertible Securities,
        plus the aggregate amount of additional Consideration (as set forth in
        the instruments relating thereto, without regard to any provision
        contained therein for a subsequent adjustment of such consideration)
        payable to the Company upon the exercise of such Options or the
        conversion or exchange of such Convertible Securities, or in the case of
        Options for Convertible Securities, the exercise of such Options for
        Convertible Securities and the conversion or exchange of such
        Convertible Securities, by (y) the number of shares of Common Stock (as
        set forth in the instruments relating thereto, without regard to any
        provision contained therein for a subsequent adjustment of such


                                      -8-



        number) issuable upon the exercise of such Options or the conversion or
        exchange of such Convertible Securities.

                      (vi) Adjustment of the Warrant Exercise Price for
Dividends, Distributions, Subdivisions, Combinations or Consolidations of
Common Stock.

                             (1) Stock Dividends, Distributions or Subdivisions.
        In the event the Company shall be deemed to have issued Additional
        Shares of Common Stock pursuant to Subsection 1.05(A)(iii)(2) in a stock
        dividend, stock distribution or subdivision, the Warrant Exercise Price
        in effect immediately before such deemed issue shall, concurrently with
        the effectiveness of such deemed issue, be proportionately decreased.

                             (2) Combinations or Consolidations. In the event
         the outstanding shares of Common Stock shall be combined or
         consolidated, by reclassification or otherwise, into a lesser number of
         shares of Common Stock, the Warrant Exercise Price in effect
         immediately prior to such combination or consolidation shall,
         concurrently with the effectiveness of such combination or
         consolidation, be proportionately increased.

               (B) Adjustments for Certain Dividends and Distributions. In the
event that at any time or from time to time after the Original Issue Date the
Company shall make or issue, or fix a record date for the determination of
holders of Common Stock entitled to receive, a dividend or other distribution
payable in securities of the Company other than shares of Common Stock, then and
in each such event provision shall be made so that the holders of Stock Purchase
Warrants shall receive upon exercise thereof in addition to the number of shares
of Common Stock receivable thereupon, the amount of securities of the Company
that they would have received had their Stock Purchase Warrants been exercised
for Common Stock on the date of such event and had they thereafter, during the
period from the date of such event to and including the exercise date, retained
such securities receivable by them as aforesaid during such period, giving
application during such period to all adjustments called for herein.

               (C) Adjustments for Reclassification, Exchange, or Substitution.
In the event that at any time or from time to time after the Original Issue
Date, the Common Stock issuable upon the exercise of this Warrant shall be
changed into the same or a different number of shares of any class or classes of
stock, whether by capital reorganization, reclassification, or otherwise (other
than a subdivision or combination of shares or stock dividend provided for
above, or a merger, consolidation, or sale of assets provided for below), then
and in each such event the registered holder of this Warrant shall have the
right thereafter to exercise this Warrant for the kind and amount of shares of
stock and other securities and property receivable upon such reorganization,
reclassification, or other change, by holders of the number of shares of Common
Stock into which such Warrant might have been exercisable for immediately prior


                                      -9-



to such reorganization, reclassification, or change, all subject to further
adjustment as provided herein.

               (D) Adjustment for Merger, Consolidation or Sale of Assets. In
the event that at any time or from time to time after the Original Issue Date,
the Company shall sell all or substantially all of its assets or merge or
consolidate with or into another entity, this Warrant shall thereafter be
exercisable for the kind and amount of shares of stock or other securities or
property to which a holder of the number of shares of Common Stock of the
Company deliverable upon exercise of this Warrant would have been entitled to
receive upon such consolidation, merger or sale; and, in such case, appropriate
adjustment (as determined in good faith by the Board of Directors) shall be made
in the application of the provisions in this Section 1.05 with respect to the
rights and interest thereafter of the registered holders of the Stock Purchase
Warrants, to the end that the provisions set forth in this Section 1.05
(including provisions with respect to changes in and other adjustments of the
Warrant Exercise Price) shall thereafter be applicable, as nearly as reasonably
may be, in relation to any shares of stock or other property thereafter
deliverable upon the exercise of this Warrant.

               (E) No Impairment. The Company shall not, by amendment of its
Certificate of Incorporation or By-Laws or through any reorganization, transfer
of assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, including, without limitation, voluntary bankruptcy
proceedings, avoid or seek to avoid the observance or performance of any of the
terms to be observed or performed hereunder by the Company but shall at all
times in good faith assist in the carrying out of all the provisions of this
Section 1.05 and in the taking of all such action as may be necessary or
appropriate on order to protect the rights of the registered holder of this
Warrant against impairment.

               (F) Notice of Adjustment of the Warrant Exercise Price or Number
of Exercisable Shares. Upon the occurrence of each adjustment, readjustment or
other change relating to the Warrant Exercise Price or in the Number of
Exercisable Shares, then, and in each such case, the Company at its expense
shall give written notice thereof, by first class mail, postage prepaid,
addressed to the registered holder at the address of such registered holder as
shown on the books of the Company, which notice shall state the Warrant Exercise
Price resulting from such adjustment and the increase or decrease in the number
of Exercisable Shares (or other denominations of securities) purchasable at the
Warrant Exercise Price upon the exercise of this Warrant setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based.

               (G) Notice. In case at any time: (1) the Company shall pay any
dividend or make any distribution (other than regular cash dividends from
earnings or earned surplus paid at an established rate) to the holders of its
Common Stock; (2) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any class or other
rights; (3) there shall be any capital reorganization or reclassification of the
capital stock of the Company, or consolidation or merger of the Company with or
sale of all or substantially all of its assets to another corporation; or (4)
there shall be a voluntary or


                                      -10-



involuntary dissolution, liquidation or winding up of the Company; then, in any
one or more of such cases, the Company shall give written notice, by first class
mail, postage prepaid, addressed to the registered holder at the address of such
registered holder as shown on the books of the Company of the date on which (a)
the books of the Company shall close or a record date shall be fixed for
determining the shareholders entitled to such dividend, distribution or
subscription rights, or (b) such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up shall take
place, as the case may be. Such notice shall also provide reasonable details of
the proposed transaction and specify the date as of which the holders of Common
Stock of record shall participate in such dividend, distribution or subscription
rights, or shall be entitled to exchange their Common Stock for securities or
other property deliverable upon such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up, as the case
may be. Such written notice shall be given at least 20 days prior to the action
in question and not less than 20 days prior to the record date or the date on
which the Company's transfer books are closed in respect thereto.

               (H) Voting Rights. This Warrant shall not entitle the registered
holder to any voting rights or any other rights as a stockholder of the Company
but upon presentation of this Warrant with the subscription form annexed duly
executed and the tender of payment of the Warrant Exercise Price at the office
of the Company pursuant to the provisions of this Warrant the registered holder
shall forthwith be deemed a stockholder of the Company in respect of the shares
of Common Stock so subscribed and paid for.

               (I) No Change Necessary. The form of this Warrant treed not be
changed because of any adjustment in the Warrant Exercise Price or in the number
of shares of Common Stock issuable upon its exercise. A Warrant issued after any
adjustment on any partial exercise or upon replacement may continue to express
the same Warrant Exercise Price and the same number of shares of Common Stock
(appropriately reduced in the case of partial exercise) as are stated on this
Warrant as initially issued, and that Warrant Exercise Price and that number of
shares shall be considered to have been so changed as of the close of business
on the date of adjustment.

        Section 2. Covenant of the Company. All shares of Common Stock which may
be issued upon the exercise of the rights represented by this Warrant, shall,
upon issuance, be duly authorized, validly issued, fully paid and non-assessable
and free from all taxes, liens and charges with respect to the issue thereof.

        Section 3. Fractional Shares. No fractional shares or scrip representing
fractional shares shall be issued upon exercise of this Warrant. If, upon
exercise of this Warrant as an entirety, the registered holder would, except for
the provisions of this Section 3, be entitled to receive a fractional share of
Common Stock, then the Company shall pay in cash to such registered holder an
amount equal to such fractional share multiplied by the fair market value of one
share of Common Stock (as reasonably determined by the Board of Directors of the
Company) on the date of such exercise.


                                      -11-



        Section 4. Substitution. In case this Warrant shall be mutilated, lost,
stolen or destroyed, the Company will issue a new Warrant of like tenor and
denomination and deliver the same (a) in exchange and substitution for and upon
surrender and cancellation of any mutilated Warrant, or (b) in lieu of any
Warrant lost, stolen or destroyed, upon receipt of evidence satisfactory to the
Company of the loss, theft, or destruction of such Warrant (including a
reasonably detailed affidavit with respect to the circumstances of any loss,
theft or destruction), and of indemnity (or, in the case of the initial holder
or any other institutional holder, an indemnity agreement) satisfactory to the
Company.

        Section 5. Transfer Restrictions. This Warrant or the shares of Common
Stock into which this Warrant is exercisable shall not be sold, transferred,
pledged or hypothecated unless the proposed disposition is the subject of a
currently effective registration statement under the Securities Act of 1933, as
amended, or unless the Company has received an opinion of counsel reasonably
satisfactory in form and scope to the Company that such registration is not
required except that such restrictions shall not apply to any transfer of this
Warrant or the shares of Common Stock into which this Warrant is exercisable:
(i) to a partner or other affiliate of the registered holder, including any
entity of which the registered holder or a related entity is a General Partner;
(ii) by gift or bequest or through inheritance to, or for the benefit of, any
member or members of the registered holder's immediate family; (iii) by a
registered holder to a trust (a) in respect of which the registered holder
serves as trustee, provided that the trust instrument governing such trust shall
provide that the registered holder, as trustee, shall retain sole and exclusive
control over the voting and disposition of such Warrant until the termination of
this Warrant or (b) for the benefit solely of any member or members of the
registered holder's immediate family; and (iv) pursuant to any underwritten
public offering of Common Stock pursuant to an effective registration statement
under the Securities Act.

        Section 6. Remedies. The Company stipulates that the remedies at law of
the registered holder of this Warrant in the event of any default or threatened
default by the Company in the performance of or compliance with any of the terms
of this Warrant are not and will not be adequate, and that such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the terms
hereof or otherwise.

        Section 7. Taxes. The Company shall pay any taxes or other charges that
may be imposed in respect of the issuance and delivery of the Warrant or any
shares of Common Stock or other property upon exercise hereof.

        Section 8. Governing Law. This Warrant shall be deemed a contract made
under the laws of the State of Delaware and its provisions and the rights and
obligations of the parties hereunder shall be governed by, and construed and
enforced in accordance with, the substantive laws of the State of Delaware,
without regard to its principles of conflicts of laws.


                                      -12-



        Section 9. Miscellaneous. This Warrant and any term hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought.

                                      ****



                                      -13-



        IN WITNESS WHEREOF, the Company has caused this Stock Purchase Warrant
to be signed by its Chairman thereunto duly authorized and its corporate seal to
be hereunto affixed and attested by its Secretary as of the ____ day of April,
1998.


ATTEST:                                 NOVATEL WIRELESS, INC.


By:                                     By:
   -------------------------------         ------------------------------------
Name: Melvin L. Flowers                 Name: John Major
Its: Secretary                          Its: Chairman




                                      -14-



                                SUBSCRIPTION FORM

        The undersigned, the registered holder of the within Stock Purchase
Warrant, hereby irrevocably elects to exercise the purchase right represented by
such Warrant for, and to purchase thereunder,__________ shares of Common Stock
of Novatel Wireless, Inc., and herewith makes payment of $____________ therefor
and requests that the certificates representing such shares be issued in the
name of and delivered to:

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

and if such shares shall not include all of the shares issuable under this
Warrant, that a new Warrant of like tenor and date be delivered to the
undersigned for the shares not issued.




Dated:____________________              _______________________________________
                                        Signature





                               FORM OF ASSIGNMENT

For value received the undersigned hereby sells, assigns and transfers unto

___________________________________ whose address is __________________________

___________________________________________________________________, the within

Warrant with respect to __________ shares purchasable thereby, and does hereby

irrevocably constitute and appoint ___________________ attorney to transfer the

within Warrant on the books of the within named corporation with full power of

substitution in the premises.



Dated:__________________________

In the presence of:


___________________________                  __________________________________
                                             Signature

EX-4.2

                                                                     EXHIBIT 4.2


THE WARRANT EVIDENCED HEREBY, AND THE SHARES OF COMMON STOCK ISSUABLE
HEREUNDER, HAVE BEEN AND WILL BE ISSUED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE APPLICABLE SECURITIES LAWS OF ANY
STATE. SUCH SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO
DISTRIBUTION OR RESALE, AND SHALL NOT BE SOLD, TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS THE PROPOSED DISPOSITION IS THE SUBJECT OF A CURRENTLY
EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT AND UNDER APPLICABLE STATE
SECURITIES LAWS OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN
FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT
SUCH REGISTRATION IS NOT REQUIRED UNDER SAID ACT AND SUCH STATE SECURITIES LAWS
IN CONNECTION WITH SUCH DISPOSITION.


                             NOVATEL WIRELESS, INC.

                         COMMON STOCK PURCHASE WARRANT


                          void After December 31, 2004

                    This Stock Purchase Warrant is Issued to

                      [INSERT NAME AND ADDRESS OF GRANTEE]


(hereinafter called the "initial registered holder" or the "registered holder,"
which term shall include its successors and assigns) by Novatel Wireless, Inc.,
a Delaware corporation (hereinafter referred to as the "Company").  The holder
of this Warrant is entitled to certain of the benefits conferred by that
certain Series C Convertible Preferred Stock and Warrant Purchase Agreement
dated as of _____________, 1999 (the "Purchase Agreement"), and that certain
Series C Investors' Rights Agreement dated as of ___________, 1999 (the
"Investors' Rights Agreement"), copies of which are on file at the office of
the Company at the address specified below. This Warrant may be transferred by
the registered holder only in accordance with the provisions of Sections 1.04
and 5 hereof. A copy of the Purchase Agreement and the Investors' Rights
Agreement will be furnished to any subsequent registered holder hereof upon
written request. The Investors' Rights Agreement contains an undertaking by the
Company under certain circumstances to effect registration and qualification
under federal and state securities laws of, or to take other action with
respect to, the shares of Common Stock, par value $.001, of the Company ("Common
Stock") issuable on exercise of this Warrant.



     Section 1.     The Warrant.

     1.01. For value received and subject to the terms and conditions
hereinafter set forth, the registered holder is entitled, upon surrender of this
Warrant at any time on or prior to December 31, 2004 (with the subscription form
annexed hereto duly executed) at the office of the Company at 9360 Towne Centre
Drive, Suite 110, San Diego, CA 92121, or such other office of which the Company
shall notify the registered holder hereof in writing, to purchase from the
Company _____________________ (____________) fully paid and non-assessable
shares ("Initial Exercisable Shares" and, as adjusted from time to time as
hereinafter provided, "Exercisable Shares") of Common Stock for an initial
exercise price of $10.00 per share as adjusted from time to time as provided
below (the "Warrant Exercise Price"). This Warrant may be exercised in full or
in part from time to time. As promptly as practicable after surrender of this
Warrant and receipt of payment of the Warrant Exercise Price, the Company shall
issue and deliver to the registered holder a certificate or certificates for
shares of Common Stock, in certificates of such denominations and in such names
as the registered holder may specify, together with any other stock, securities
or property to which such holder may be entitled to receive pursuant to Sections
1.05(B), 1.05(C) or 1.05(D) hereof. In the case of the purchase of less than all
the shares purchasable under this Warrant, the Company shall cancel this Warrant
upon the surrender hereof and shall execute and deliver a substitute Warrant of
like tenor for the balance of the shares purchasable hereunder. This Warrant
shall expire at 8:00 P.M. (Eastern Standard Time) on ___________, 2004 and shall
be void thereafter.

     1.02. During the period within which the rights represented by this Warrant
may be exercised, the Company shall at all times have authorized and reserved
for the purpose of issue upon exercise of the rights evidenced hereby, a
sufficient number of shares of its Common Stock to provide for the exercise of
such rights. Upon surrender for exercise, this Warrant shall be canceled and
shall not be reissued; provided, however, that upon the partial exercise hereof
a substitute Warrant representing the rights to subscribe for and purchase any
such unexercised portion hereof shall be issued.

     1.03. Subject to compliance with applicable securities laws, this Warrant
may be subdivided into one or more Stock Purchase Warrants entitling the
registered holder to purchase shares of Common Stock in multiples of one or more
whole shares, upon surrender of this Warrant by the registered holder for such
purpose at the office of the Company.

     1.04. The Company shall maintain at its office (or at such other office or
agency of the Company as it may from time to time designate in writing to the
registered holder hereof), a register containing the names and addresses of the
holders of all Stock Purchase Warrants. The registered holder of such a Warrant
shall be the person in whose name the Warrant is originally issued and
registered, unless a subsequent holder shall have presented to the Company such
Warrant, duly assigned to him, for inspection and a written notice of his
acquisition of such Warrant and designating in writing the address of such
holder, in which case such subsequent holder of the Warrant shall become a
subsequent registered holder. Any registered holder of this Warrant may change
his address as shown on such register by written notice to the Company
requesting such change. Any written notice required or permitted to be given to
the registered holder of this Warrant shall be mailed, by registered or
certified mail, to such registered holder at his address as shown on such
register.


                                       2

     1.05. The rights of the registered holder shall be subject to the following
terms and conditions:

          (A) Adjustments to the Warrant Exercise Price.

               (i) Special Definitions. For purposes of this Subsection 1.05,
the following definitions shall apply:

                    (1) "Option" shall mean rights, options or warrants to
     subscribe for, purchase or otherwise acquire either Common Stock or
     Convertible Securities.

                    (2) "Warrant Exercise Price" shall mean initially $10.00 per
     share and shall be subject to adjustment as hereinafter provided.

                    (3) "Original Issue Date" shall mean the date on which this
     Warrant was issued.

                    (4) "Stock Purchase Warrants" shall mean the Warrants sold
     by the Company pursuant to the Purchase Agreement.

                    (5) "Series C Purchase Price" shall mean $8.34 per share of
     the Company's Series C Convertible Preferred Stock, par value $0.001 per
     share ("Series C Preferred Stock").

                    (6) "Convertible Securities" shall mean any evidences of
     indebtedness, shares of capital stock (other than Common Stock) or other
     securities directly or indirectly convertible into or exchangeable for
     Common Stock.

                    (7) "Additional Shares of Common Stock" shall mean all
     shares of Common Stock issued (or, pursuant to Subsection 1.05(A)(iii),
     deemed to be issued) by the Company after the Original Issue Date, other
     than:

                         (a) issuance of Common Stock upon the exercise or
          conversion of securities of the Company outstanding as of the Original
          Issue Date;

                         (b) securities issued upon the conversion of the
          Company's Series C Preferred Stock;

                         (c) securities issued upon the conversion of the
          Company's Series B Convertible Preferred Stock, par value $0.0001 per
          share (the "Series B Preferred Stock"), including such shares of
          Series B Preferred issued upon the conversion of all of the
          outstanding shares of the Series B Preferred Stock of Novatel Wireless
          Technologies Ltd. ("NWT") into shares of the Series B Preferred Stock;

                         (d) securities issued upon the conversion of the
          Company's Series A Convertible Preferred Stock, par value $0.0001 per
          share



                                       3




(the "Series A Preferred Stock"), including such shares of Series A Preferred
issued upon the conversion of all of the outstanding shares of the Series A
Preferred Stock of NWT into shares of the Series A Preferred Stock;

          (e)  shares of the Company's Common Stock to be issued upon exercise
or conversion of options or warrants to purchase the Company's Common Stock
outstanding as of the Original Issue Date, respectively;

          (f)  up to 330,105 shares of the Company's Common Stock to be issued
upon exchange of shares of the exchangeable common stock of NWT issued upon
exercise of warrants to purchase such shares;

          (g)  any minimum number of shares of capital stock required by law to
be issued to directors of the Company;

          (h)  securities issued or issuable as a dividend or distribution on
the Series A Preferred Stock, Series B Preferred Stock or Series C Preferred
Stock;

          (i)  up to 2,000,000 shares of the Company's Common Stock (or related
options) (appropriately adjusted to take account of any stock split, stock
dividend, combination of shares or the like), or such higher number of shares
(or options) as is recommended by the Compensation Committee of the Company's
Board of Directors and approved by the Company's Board of Directors, issued or
issuable to officers, directors or employees of, or consultants to, the Company
pursuant to a stock purchase or option or warrant plan or other similar
arrangement approved by the Board of Directors;

          (j)  any issuance of securities for which adjustment of the Warrant
Exercise Price is made pursuant to Subsection 1.05(A);

          (k)  securities (or securities issued upon the exercise of
securities) issued in connection with financing arrangements with lending
institutions or equipment leasing arrangements;

          (l)  any shares of capital stock of the Company, not to exceed
one-half of one percent of the total issued and outstanding capital stock of
the Company on an "as converted to Common Stock" basis, the issuance of which
is approved by vote of a majority of the Board of Directors of the Company,
including the affirmative vote of a majority of the directors designated for
election by the holders of the Series C Preferred Stock; and

          (m)  not more than ten shares of capital stock of the Company on an
"as converted to Common Stock" basis, the issuance of which resulted from
mathematical or other error or inadvertence, provided that the transaction in
which such shares were issued was approved at the time by vote of a majority of
the Board of Directors of the Company, including the affirmative


                                       4


     vote of a majority of the directors designated for election by the holders
     of the Series C Preferred Stock.

          (ii)  No Adjustment to Warrant Exercise Price. Except as set forth in
Subsection 1.05(A)(vi), no adjustment to the Warrant Exercise Price shall be
made unless the consideration per share for an Additional Share of Common Stock
issued or deemed to be issued by the Company is less than the Series C Purchase
Price.

          (iii) Issue of Securities Deemed Issue of Additional Shares of Common
Stock.

               (1) Options and Convertible Securities. In the event the Company
     at any time or from time to time after the Original Issue Date shall issue
     any Options or Convertible Securities or shall fix a record date for the
     determination of holders of any class of securities entitled to receive any
     such Options or Convertible Securities, then the maximum number of shares
     (as set forth in the instrument relating thereto without regard to any
     provisions contained therein for a subsequent adjustment of such number) of
     Common Stock issuable upon the exercise of such Options, or in the case of
     Convertible Securities and Options therefor, the conversion or exchange of
     such Convertible Securities, shall be deemed to be Additional Shares of
     Common Stock issued as of the time of such issue or, in case such a record
     date shall have been fixed, as of the close of business (Eastern Standard
     Time or Eastern Daylight Savings Time, if applicable) on such record date,
     provided that Additional Shares of Common Stock shall not be deemed to have
     been issued unless the consideration per share (determined pursuant to
     Subsection 1.05(A)(v) hereof) of such Additional Shares of Common Stock
     would be less than the Series C Purchase Price in effect on the date of and
     immediately prior to such issue, or such record date, as the case may be,
     and provided further that in any such case in which Additional Shares of
     Common Stock are deemed to be issued;

                    (a)  no further adjustment in the Warrant Exercise Price
               shall be made upon the subsequent issue of Convertible Securities
               or shares of Common Stock upon the exercise of such Options or
               conversion or exchange of such Convertible Securities;

                    (b)  if such Options or Convertible Securities by their
               terms provide, with the passage of time or otherwise, for any
               increase in the Consideration (as defined in Subsection 1.05
               (A)(v)) payable to the Company, or decrease in the number of
               shares of Common Stock or Convertible Securities issuable, upon
               the exercise, conversion or exchange thereof, the Warrant
               Exercise Price computed upon the original issue thereof (or upon
               the occurrence of a record date with respect thereto), and any
               subsequent adjustments based thereon, shall, upon any such
               increase or decrease becoming effective, be recomputed to reflect
               such increase or decrease insofar as it affects such Options or
               the rights of conversion or exchange under such Convertible
               Securities;

                    (c)  upon the expiration of any such Options or any rights
               of conversion or exchange under such Convertible Securities which
               shall


                                       5


not have been exercised, the Warrant Exercise Price computed upon the original
issue thereof (or upon the occurrence of a record date with respect thereto),
and any subsequent adjustments based thereon, shall, upon such expiration, be
recomputed as if:

                         (i)  In the case of Convertible Securities or Options
for Common Stock the only Additional Shares of Common Stock issued were the
shares of Common Stock, if any, actually issued upon the exercise of such
Options or the conversion or exchange of such Convertible Securities and the
consideration received therefor was the consideration actually received by the
Company for the issue of all such Options, whether or not exercised, plus the
consideration actually received by the Company upon such exercise, or for the
issue of all such Convertible Securities which were actually converted or
exchanged, plus the additional consideration, if any, actually received by the
Company upon such conversion or exchange; and

                         (ii) in the case of Options for Convertible Securities
only the Convertible Securities, if any, actually issued upon the exercise
thereof were issued at the time of issue of such Options, and the consideration
received by the Company for the Additional Shares of Common Stock deemed to
have been then issued was the consideration actually received by the Company
for the issue of all such Options, whether or not exercised, plus the
consideration deemed to have been received by the Company (determined pursuant
to Subsection 1.05(A)(v)) upon the issue of the Convertible Securities with
respect to which such Options were actually exercised;

                    (d)  no readjustment pursuant to clause (b) or (c) above
shall have the effect of increasing the Warrant Exercise Price to an amount
which exceeds the lower of (i) the Warrant Exercise Price on the original
adjustment date, or (ii) the Warrant Exercise Price that would have resulted
from any issuance of Additional Shares of Common Stock between the original
adjustment date and such readjustment date;

                    (e)  in the case of any Options which expire by their terms
not more than thirty days after the date of issue thereof, no adjustment of the
Warrant Exercise Price shall be made until the expiration or exercise of all
such Options, whereupon such adjustment shall be made in the same manner
provided in clause (c) above; and

                    (f)  if such record date shall have been fixed and such
Options or Convertible Securities are not issued on the date fixed therefor,
the adjustment previously made in the Warrant Exercise Price which became
effective on such record date shall be canceled as of 8:00 P.M. Eastern
Standard Time (or Eastern Daylight Savings Time if applicable) on such record
date, and thereafter the Warrant Exercise Price shall be adjusted pursuant to
this Subsection 1.05(A)(iii) as of the actual date of their issuance.


                                       6


                    (2) Stock Dividends, Stock Distributions and Subdivisions.
     In the event the Company at any time or from time to time after the
     Original Issue Date shall declare or pay any dividend or make any other
     distribution on the Common Stock payable in Common Stock or effect a
     subdivision of the outstanding shares of Common Stock (by reclassification
     or otherwise than by payment of a dividend in Common Stock), then and in
     any such event, Additional Shares of Common Stock shall be deemed to have
     been issued:

                         (a) in the case of any such dividend or distribution,
          immediately after 8:00 P.M. (Eastern Standard Time or Eastern
          Daylight Savings Time, if applicable) on the record date for the
          determination of holders of any class of securities entitled to
          receive such dividend or distribution, or

                         (b) in the case of any such subdivision, at 8:00 P.M.
          (Eastern Standard Time or Eastern Daylight Savings Time, if
          applicable) on the date immediately prior to the date upon which such
          corporate action becomes effective.

                 If such record date shall have been fixed and no part of
          such dividend shall have been paid on the date fixed therefor, the
          adjustment previously made in the Warrant Exercise Price which became
          effective on such record date shall be canceled as of 8:00 P.M.
          (Eastern Standard Time or Eastern Daylight Savings time, if
          applicable) on such record date, and thereafter the Warrant Exercise
          Price shall be adjusted pursuant to this Section 1.05(A)(iii) as of
          the time of actual payment of such dividend.

     Adjustment to the Warrant Exercise Price Upon Issuance of Additional
Shares of Common Stock. In the event that at any time or from time to time
after the Original Issue Date, the Company shall issue Additional Shares of
Common Stock (including, without limitation, Additional Shares of Common Stock
deemed to be issued pursuant to Subsection 1.05(A)(iii)(1) but excluding
Additional Shares of Common Stock deemed to be issued pursuant to Subsection
1.05(A)(iii)(2), which event is dealt with in Subsection 1.05(A)(vi)(1)),
without consideration or for a consideration per share less than the Series C
Purchase Price, then and in such event, (A) so long as the consideration per
share for which such Additional Shares of Common Stock are issued or deemed to
be issued is above or equal to $5.14, the Warrant Exercise Price shall be
reduced concurrently with such issue, to a price equal to such consideration
per share; and (B) if the consideration per share for which such Additional
Shares of Common Stock are issued or deemed issued is below $5.14, the Warrant
Exercise Price shall be reduced, concurrently with such issue, to a price
(calculated to the nearest cent) determined by multiplying $5.14 by a fraction,
the numerator of which shall be the number of shares of Common Stock
outstanding immediately prior to such issue plus the number of shares of Common
Stock which the aggregate consideration received by the Corporation for the
total number of Additional Shares of Common Stock so issued would purchase at
$5.14, and the denominator of which shall be the number of shares of Common
Stock outstanding immediately prior to such issue plus the number of such
Additional Shares of Common Stock so issued. For the purpose of the above
calculation, the number of shares of Common Stock outstanding immediately prior
to such issue shall be calculated on a fully diluted basis, as if all shares of
Series A Preferred Stock, Series B Preferred


                                       7



Stock and Series C Preferred Stock and all Convertible Securities had been fully
converted into shares of Common Stock immediately prior to such issuance and any
outstanding warrants, options or other rights for the purchase of shares of
stock or convertible securities had been fully exercised immediately prior to
such issuance (and the resulting securities fully converted into shares of
Common Stock, if so convertible) as of such date, but not including in such
calculation any additional shares of Common Stock issuable with respect to
shares of Series A Preferred Stock, Series B Preferred Stock, Series C Preferred
Stock, Convertible Securities, or outstanding options, warrants or other rights
for the purchase of shares of stock or convertible securities, solely as a
result of the adjustment of the Series A Conversion Price, Series B Conversion
Price or Series C Conversion Price (or other conversion ratios) pursuant to the
Corporation's Restated Certificate of Incorporation resulting from the issuance
of the Additional Shares of Common Stock causing the adjustment in question.

               (iv) Determination of Consideration. For purposes of this
Subsection 1.05(A), the consideration (the "Consideration") received or
receivable by the Company for the issue of any Additional Shares of Common
Stock shall be computed as follows:

                    (1)  Cash and Property:  Such Consideration shall:

                         (a)  insofar as it consists of cash, be computed at the
          aggregate amounts of cash received by the Company excluding amounts
          paid or payable for accrued interest or accrued dividends;

                         (b)  insofar as it consists of property other than
          cash, be computed at the fair value thereof at the time of such issue,
          as determined in good faith by the Board of Directors; and

                         (c)  in the event Additional Shares of Common Stock are
          issued together with other shares or securities or other assets of the
          Company for consideration which covers both, be the proportion of such
          consideration so received or receivable computed as provided in
          Subsections 1.05(A)(v)(1)(a) and 1.05(A)(v)(1)(b) above, allocable to
          such Additional Shared of Common Stock as determined in good faith by
          the Board of Directors; provided, however, that in the event warrants
          or other options to purchase shares of Common Stock are issued without
          consideration or for a nominal consideration contemporaneously with
          the issuance of debt or preferred stock, or both, then the
          consideration received by the Company for such debt or preferred
          stock shall be deemed properly allocated to the issuance of the
          warrants or options.

                    (2)  Additional Shares of Common Stock other than Options
          and Convertible Securities.  The Consideration per share for the issue
          of any Additional Shares of Common Stock other than Options and
          Convertible Securities shall be the Consideration for the issue of any
          Additional Shares of Common Stock other than Options or Convertible
          Securities, divided by the total number of such Additional Shares of
          Common Stock issued by the Corporation in exchange therefor.




                                       8

                    (3)  Options and Convertible Securities. The Consideration
       per share for Additional Shares of Common Stock deemed to have been
       issued pursuant to Subsection 1.05(A)(iii)(1), relating to Options and
       Convertible Securities, shall be computed by dividing (x) the
       Consideration for the issue of such Options or Convertible Securities,
       plus the aggregate amount of additional Consideration (as set forth in
       the instruments relating thereto, without regard to any provision
       contained therein for a subsequent adjustment of such Consideration)
       payable to the Company upon the exercise of such Options or the
       conversion or exchange of such Convertible Securities, or in the case of
       Options for Convertible Securities, the exercise of such Options for
       Convertible Securities and the conversion or exchange of such Convertible
       Securities, by (y) the number of shares of Common Stock (as set forth in
       the instruments relating thereto, without regard to any provision
       contained therein for a subsequent adjustment of such number) issuable
       upon the exercise of such Options or the conversion or exchange of such
       Convertible Securities.

               (v)  Adjustment of the Warrant Exercise Price for Dividends,
Distributions, Subdivisions, Combinations or Consolidations of Common Stock.

                    (1)  Stock Dividends, Distributions or Subdivisions. In the
       event the Company shall be deemed to have issued Additional Shares of
       Common Stock pursuant to Subsection 1.05(A)(iii)(2) in a stock dividend,
       stock distribution or subdivision, the Warrant Exercise Price in effect
       immediately before such deemed issue shall, concurrently with the
       effectiveness of such deemed issue, be proportionately decreased.

                    (2)  Combinations or Consolidations. In the event the
       outstanding shares of Common Stock shall be combined or consolidated, by
       reclassification or otherwise, into a lesser number of shares of Common
       Stock, the Warrant Exercise Price in effect immediately prior to such
       combination or consolidation shall, concurrently with the effectiveness
       of such combination or consolidation, be proportionately increased.

          (B)  Adjustments for Certain Dividends and Distributions. In the event
that at any time or from time to time after the Original Issue Date the Company
shall make or issue, or fix a record date for the determination of holders of
Common Stock entitled to receive, a dividend or other distribution payable in
securities of the Company other than shares of Common Stock, then and in each
event provision shall be made so that the holders of Stock Purchase Warrants
shall receive upon exercise thereof in addition to the number of shares of
Common Stock receivable thereupon, the amount of securities of the Company that
they would have received had their Stock Purchase Warrants been exercised for
Common Stock on the date of such event and had they thereafter, during the
period from the date of such event to and including the exercise date, retained
such securities receivable by them as aforesaid during such period, giving
application during such period to all adjustments called for herein.

          (C)  Adjustment of Reclassification, Exchange, or Substitution. In the
event that at any time or from time to time after the Original Issue Date, the
Common Stock issuable upon the exercise of this Warrant shall be changed into
the same or a different number of shares


                                       9

of any class or classes of stock, whether by capital reorganization,
reclassification, or otherwise (other than a subdivision or combination of
shares or stock dividend provided for above, or a merger, consolidation, or sale
of assets provided for below), then and in each such event the registered holder
of this Warrant shall have the right thereafter to exercise this Warrant for the
kind and amount of shares of stock and other securities and property receivable
upon such reorganization, reclassification, or other change, by holders of the
number of shares of Common Stock into which such Warrant might have been
exercisable for immediately prior to such reorganization, reclassification, or
change, all subject to further adjustment as provided herein.

          (D)  Adjustment for Merger, Consolidation or Sale of Assets. In the
event that at any time or from time to time after the Original Issue Date, the
Company shall sell all or substantially all of its assets or merger or
consolidate with or into another entity, this Warrant shall thereafter be
exercisable for the kind and amount of shares of stock or other securities or
property to which a holder of the number of shares of Common Stock of the
Company deliverable upon exercise of this Warrant would have been entitled to
receive upon such consolidation, merger or sale; and, in such case, appropriate
adjustment (as determined in good faith by the Board of Directors) shall be made
in the application of the provisions in this Section 1.05 with respect to the
rights and interest thereafter of the registered holders of the Stock Purchase
Warrants, to the end that the provisions set forth in this Section 1.05
(including provisions with respect to changes in and other adjustments of the
Warrant Exercise Price) shall thereafter be applicable, as nearly as reasonably
may be, in relation to any shares of stock or other property thereafter
deliverable upon the exercise of this Warrant.

          (E)  No Impairment.  The Company shall not, by amendment of its
Certificate of Incorporation or By-Laws or through any reorganization, transfer
of assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, including, without limitation, voluntary bankruptcy
proceedings, avoid or seek to avoid the observance or performance of any of the
terms to be observed or performed hereunder by the Company but shall at all
times in good faith assist in the carrying out of all the provisions of this
Section 1.05 and in the taking of all such action as may be necessary or
appropriate on order to protect the rights of the registered holder of this
Warrant against impairment.

          (F)  Notice of Adjustment of the Warrant Exercise Price or Number of
Exercisable Shares. Upon the occurrence of each adjustment, readjustment or
other change relating to the Warrant Exercise Price or in the number of
Exercisable Shares, then, and in each such case, the Company at its expense
shall give written notice thereof, by first class mail, postage prepaid,
addressed to the registered holder at the address of such registered holder as
shown on the books of the Company, which notice shall state the Warrant
Exercise Price resulting from such adjustment and the increase or decrease in
the number of Exercisable Shares (or other denominations of securities)
purchasable at the Warrant Exercise Price upon the exercise of this Warrant
setting forth in reasonable detail the method of calculation and the facts upon
which such calculation is based.

          (G)  Notice. In case at any time: (1) the Company shall pay any
dividend or make any distribution (other than regular cash dividends from
earnings or earned surplus paid at an established rate) to the holders of its
Common Stock; (2) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any


                                       10


class or other rights; (3) there shall be any capital reorganization or
reclassification of the capital stock of the Company, or consolidation or
merger of the Company with or sale of all or substantially all of its assets to
another corporation; or (4) there shall be a voluntary or involuntary
dissolution, liquidation or winding up of the Company; then, in any one or more
of such cases, the Company shall give written notice, by first class mail,
postage prepaid, addressed to the registered holder at the address of such
registered holder as shown on the books of the Company of the date on which (a)
the books of the Company shall close or a record date shall be fixed for
determining the shareholders entitled to such dividend, distribution or
subscription rights, or (b) such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up shall take
place, as the case may be. Such notice shall also provide reasonable details of
the proposed transaction and specify the date as of which the holders of Common
Stock of record shall participate in such dividend, distribution or
subscription rights, or shall be entitled to exchange their Common Stock for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding up, as the case may be. Such written notice shall be given at least 20
days prior to the action in question and not less than 20 days prior to the
record date or the date on which the Company's transfer books are closed in
respect thereto.

          (H) Voting Rights. This Warrant shall not entitle the registered
holder to any voting rights or any other rights as a stockholder of the Company
but upon presentation of this Warrant with the subscription form annexed duly
executed and the tender of payment of the Warrant Exercise Price at the office
of the Company pursuant to the provisions of this Warrant the registered holder
shall forthwith be deemed a stockholder of the Company in respect of the shares
of Common Stock so subscribed and paid for.

          (I) No Change Necessary. The form of this Warrant need not be changed
because of any adjustment in the Warrant Exercise Price or in the number of
shares of Common Stock issuable upon its exercise. A Warrant issued after any
adjustment on any partial exercise or upon replacement may continue to express
the same Warrant Exercise Price and the same number of shares of Common Stock
(appropriately reduced in the case of partial exercise) as are stated on this
Warrant as initially issued, and that Warrant Exercise Price and that number of
shares shall be considered to have been so changed as of the close of business
on the date of adjustment.

     Section 2. Covenant of the Company. All shares of Common Stock which may
be issued upon the exercise of the rights represented by this Warrant, shall,
upon issuance, be duly authorized, validly issued, fully paid and
non-assessable and free from all taxes, liens and charges with respect to the
issue thereof.

     Section 3. Fractional Shares. No fractional shares or scrip representing
fractional shares shall be issued upon exercise of this Warrant. If, upon
exercise of this Warrant as an entirety, the registered holder would, except
for the provisions of this Section 3, be entitled to receive a fractional share
of Common Stock, then the Company shall pay in cash to such registered holder
an amount equal to such fractional share multiplied by the fair market value of
one share of Common Stock (as reasonably determined by the Board of Directors
of the Company) on the date of such exercise.



                                       11





     Section 4.     Substitution. In case this Warrant shall be mutilated,
lost, stolen or destroyed, the Company will issue a new Warrant of like tenor
and denomination and deliver the same (a) in exchange and substitution for and
upon surrender and cancellation of any mutilated Warrant, or (b) in lieu of any
Warrant lost, stolen or destroyed, upon receipt of evidence satisfactory to
the Company of the loss, theft, or destruction of such Warrant (including a
reasonably detailed affidavit with respect to the circumstances of any loss,
theft or destruction), and of indemnity (or, in the case of the initial holder
or any other institutional holder, an indemnity agreement) satisfactory to the
Company.

     Section 5.     Transfer Restrictions.   This Warrant or the shares of
Common Stock into which this Warrant is exercisable shall not be sold,
transferred, pledged or hypothecated unless the proposed disposition is the
subject of a currently effective registration statement under the Securities
Act of 1933, as amended (the "Securities Act"), or unless the Company has
received an opinion of counsel reasonably satisfactory in form and scope to the
Company that such registration is not required except that such restrictions
shall not apply to any transfer of this Warrant or the shares of Common Stock
into which this Warrant is exercisable; (i) to a partner or other affiliate of
the registered holder, including any entity of which the registered holder or a
related entity is a General Partner; (ii) by gift or bequest or through
inheritance to, or for the benefit of, any member or members of the registered
holder's immediate family; (iii) by a registered holder to a trust (a) in
respect of which the registered holder serves as trustee, provided that the
trust instrument governing such trust shall provide that the registered holder,
as trustee, shall retain sole and exclusive control over the voting and
disposition of such Warrant until the termination of this Warrant or (b) for
the benefit solely of any member or members of the registered holder's immediate
family; and (iv) pursuant to any underwritten public offering of Common Stock
pursuant to an effective registration statement under the Securities Act.

     Section 6.     Taxes.  The Company shall pay any taxes or other charges
that may be imposed in respect of the issuance and delivery of the Warrant or
any shares of Common Stock or other property upon exercise hereof.

     Section 7.     Governing Law.  This Warrant shall be deemed a contract
made under the laws of the State of Delaware and its provisions and the rights
and obligations of the parties hereunder shall be governed by, and construed
and enforced in accordance with, the substantive laws of the State of Delaware,
without regard to its principles of conflicts of laws.

     Section 8.     Miscellaneous.  This Warrant and any term hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought.

                                     ******



                                       12

     IN WITNESS WHEREOF, the Company has caused this Common Stock Purchase
Warrant to be signed by its Chief Executive Officer thereunto duly authorized
and its corporate seal to be hereunto affixed and attested by its Secretary this
____ day of December, 1999.


ATTEST:                                 NOVATEL WIRELESS, INC.


By:                                     By:
    -------------------------               -------------------------
Name: Roger Hartman                     Name: Robert Corey
Its: Secretary                          Its: Chief Executive Officer

                               SUBSCRIPTION FORM

     The undersigned, the registered holder of the within Common Stock Purchase
Warrant, hereby irrevocably elects to exercise the purchase right represented
by such Warrant for, and to purchase thereunder, _______ shares of Common Stock
of Novatel Wireless, Inc., and herewith makes payment of $_______ therefor and
requests that the certificates representing such shares be issued in the name
of and delivered to:

- --------------------------------------------------------------------------

- --------------------------------------------------------------------------

- --------------------------------------------------------------------------
and if such shares shall not include all of the shares issuable under this
Warrant, that a new Warrant of like tenor and date be delivered to the
undersigned for the shares not issued.



Dated:
      ----------------------            -----------------------------------
                                        Signature


                               FORM OF ASSIGNMENT

For value received the undersigned hereby sells, assigns and transfers unto
_________________________________ whose address is ________________________
___________________________________________________________________________
________________________________________________________________, the within
Common Stock Purchase Warrant with respect to ___________ shares purchasable
thereby, and does hereby irrevocably constitute and appoint ____________________
attorney to transfer such Warrant on the books of the within named corporation
with full power of substitution in the premises.

Dated:_____________________________

In the presence of:

___________________________________             _____________________________
                                                Signature

EX-4.3

                                                                     EXHIBIT 4.3


THE WARRANT EVIDENCED HEREBY, AND THE SHARES OF COMMON STOCK ISSUABLE HEREUNDER,
HAVE BEEN AND WILL BE ISSUED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR THE APPLICABLE SECURITIES LAWS OF ANY STATE. SUCH
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION
OR RESALE, AND SHALL NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS
THE PROPOSED DISPOSITION IS THE SUBJECT OF A CURRENTLY EFFECTIVE REGISTRATION
STATEMENT UNDER SAID ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR UNLESS
THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER SAID ACT AND SUCH STATE SECURITIES LAWS IN CONNECTION WITH SUCH
DISPOSITION.

                             NOVATEL WIRELESS, INC.

                          COMMON STOCK PURCHASE WARRANT

                         Void After ________ ___, 2004

                    This Stock Purchase Warrant is Issued to

                      [INSERT NAME AND ADDRESS OF GRANTEE]


(hereinafter called the "initial registered holder" or the "registered holder,"
which term shall include its successors and assigns) by Novatel Wireless, Inc.,
a Delaware corporation (hereinafter referred to as the "Company"). The holder of
this Warrant is entitled to certain of the benefits conferred by that certain
Unit Purchase Agreement dated as of _________ __, 1999 (the "Purchase
Agreement"), and that certain Registration Rights Agreement, as amended, dated
as of ________ __, 1999 (the "Registration Rights Agreement"), copies of which
are on file at the office of the Company at the address specified below. This
Warrant may be transferred by the registered holder only in accordance with the
provisions of Sections 1.04 and 5 hereof. A copy of the Purchase Agreement and
the Registration Rights Agreement will be furnished to any subsequent registered
holder hereof upon written request. The Registration Rights Agreement contains
an undertaking by the Company under certain circumstances to effect registration
and qualification under federal and state securities laws of, or to take other
action with respect to, the shares of Common Stock, par value $.001, of the
Company ("Common Stock") issuable on exercise of this Warrant.





        Section 1. The Warrant.

        1.01. For value received and subject to the terms and conditions
hereinafter set forth, the registered holder is entitled, upon surrender of this
Warrant at any time on or prior to ______ __, 2004 (with the subscription form
annexed hereto duly executed) at the office of the Company at 6540 Lusk Blvd.,
Suite C-166, San Diego, CA 92121, or such other office of which the Company
shall notify the registered holder hereof in writing, to purchase from the
Company [INSERT NUMBER OF SHARES] fully paid and non-assessable shares ("Initial
Exercisable Shares" and, as adjusted from time to time as hereinafter provided,
"Exercisable Shares") of Common Stock for an initial exercise price of $2.00 per
share as adjusted from time to time as provided below (the "Warrant Exercise
Price"). This Warrant may be exercised in full or in part from time to time. As
promptly as practicable after surrender of this Warrant and receipt of payment
of the Warrant Exercise Price, the Company shall issue and deliver to the
registered holder a certificate or certificates for shares of Common Stock, in
certificates of such denominations and in such names as the registered holder
may specify, together with any other stock, securities or property to which such
holder may be entitled to receive pursuant to Sections 1.05(B), 1.05(C) or
1.05(D) hereof. In the case of the purchase of less than all the shares
purchasable under this Warrant, the Company shall cancel this Warrant upon the
surrender hereof and shall execute and deliver a substitute Warrant of like
tenor for the balance of the shares purchasable hereunder. This Warrant shall
expire at 8:00 P.M. (Eastern Standard Time) on ______ __, 2004 and shall be void
thereafter.

        1.02. During the period within which the rights represented by this
Warrant may be exercised, the Company shall at all times have authorized and
reserved for the purpose of issue upon exercise of the rights evidenced hereby,
a sufficient number of shares of its Common Stock to provide for the exercise of
such rights. Upon surrender for exercise, this Warrant shall be canceled and
shall not be reissued; provided, however, that upon the partial exercise hereof
a substitute Warrant representing the rights to subscribe for and purchase any
such unexercised portion hereof shall be issued.

        1.03. Subject to compliance with applicable securities laws, this
Warrant may be subdivided into one or more Stock Purchase Warrants entitling the
registered holder to purchase shares of Common Stock in multiples of one or more
whole shares, upon surrender of this Warrant by the registered holder for such
purpose at the office of the Company.

        1.04. The Company shall maintain at its office (or at such other office
or agency of the Company as it may from time to time designate in writing to the
registered holder hereof), a register containing the names and addresses of the
holders of all Stock Purchase Warrants. The registered holder of such a Warrant
shall be the person in whose name such Warrant is originally issued and
registered, unless a subsequent holder shall have presented to the Company such
Warrant, duly assigned to him, for inspection and a written notice of his
acquisition of such Warrant and designating in writing the address of such
holder, in which case such subsequent holder of the Warrant shall become a
subsequent registered holder. Any registered holder of this Warrant may change
his address as shown on such register by written notice to the Company
requesting such change. Any written notice required or permitted to be given to
the registered holder of this Warrant shall be mailed, by registered or
certified mail, to such registered holder at his address as shown on such
register.



        1.05. The rights of the registered holder shall be subject to the
following terms and conditions:

                (A) Adjustments to the Warrant Exercise Price.

                        (i) Special Definitions. For purposes of this Subsection
1.05, the following definitions shall apply:

                                (1) "Option" shall mean rights, options or
warrants to subscribe for, purchase or otherwise acquire either Common Stock or
Convertible Securities.

                                (2) "Warrant Exercise Price" shall mean
initially $2.00 per share and shall be subject to adjustment as hereinafter
provided.

                                (3) "Original Issue Date" shall mean the date on
which this Warrant was issued.

                                (4) "Stock Purchase Warrants" shall mean the
Warrants sold by the Company pursuant to the Purchase Agreement.

                                (5) "Convertible Securities" shall mean any
evidences of indebtedness, shares of capital stock (other than Common Stock) or
other securities directly or indirectly convertible into or exchangeable for
Common Stock.

                                (6) "Convertible Debentures" shall mean the
Convertible Debentures sold by the Company pursuant to the Purchase Agreement.

                                (7) "Additional Shares of Common Stock" shall
mean all shares of Common Stock issued (or, pursuant to Subsection 1.05(A)(iii),
deemed to be issued) by the Company after the Original Issue Date, other than:

                                        (a) up to 2,347,418 shares of the
        Company's Common Stock (appropriately adjusted to take account of any
        stock split, stock dividend, combination of shares or the like) to be
        issued upon conversion of the Company's Series B Convertible Preferred
        Stock, par value $0.001 per share ("Series B Preferred Stock"), assuming
        conversion of all of the outstanding shares of the Series B Preferred
        Stock of Novatel Wireless Technologies Ltd. ("NWT") into shares of the
        Series B Preferred Stock;

                                        (b) up to 4,980,444 shares of the
        Company's Common Stock (appropriately adjusted to take account of any
        stock split, stock dividend, combination of shares or the like) to be
        issued upon conversion of shares of the Company's Series A Convertible
        Preferred Stock, par value $0.001 per share ("Series A Preferred
        Stock"), assuming conversion of all of the outstanding shares of the
        Series A Preferred Stock of NWT into shares of the Series A Convertible
        Preferred Stock of the Company;



                                        (c) up to 2,110,176 shares of the
        Company's Common Stock to be issued upon exercise of warrants to
        purchase the Company's Common Stock granted by the Company;

                                        (d) up to 330,105 shares of the
        Company's Common Stock to be issued upon exchange of shares of the
        exchangeable common stock of NWT issued upon exercise of warrants to
        purchase such shares;

                                        (e) any minimum number of shares of
        capital stock required by law to be issued to directors of the Company;

                                        (f) up to 796,056 shares of the
        Company's Common Stock (appropriately adjusted to take account of any
        stock split, stock dividend, combination of shares or the like), or such
        higher number of shares as is recommended by the Compensation Committee
        of the Company's Board of Directors and approved by the Company's Board
        of Directors, of Common Stock (or related options) issued or issuable to
        officers, directors or employees of, or consultants to, the Company
        pursuant to a stock purchase or option or warrant plan or other similar
        arrangement approved by the Board of Directors;

                                        (g) any shares of the Company's
        Preferred Stock, par value $0.001 per share, issued upon the conversion
        of the amounts outstanding under the Convertible Debentures in
        accordance with the terms thereof, and any shares of the Company's
        Common Stock issued upon conversion of such shares of Preferred Stock in
        accordance with the terms thereof;

                                        (h) any shares of capital stock of the
        Company, not to exceed one-half of one percent of the total issued and
        outstanding capital stock of the Company on an "as converted to Common
        Stock" basis, the issuance of which is approved by vote of a majority of
        the Board of Directors of the Company, including the affirmative vote of
        a majority of the directors designated for election by the holders of
        the Series A and Series B Preferred Stock; and

                                        (i) not more than ten shares of capital
        stock of the Company on an "as converted to Common Stock" basis, the
        issuance of which resulted from mathematical or other error or
        inadvertence, provided that the transaction in which such shares were
        issued was approved at the time by vote of a majority of the Board of
        Directors of the Company, including the affirmative vote of a majority
        of the directors designated for election by the holders of the Company's
        Series A and Series B Preferred Stock.

                (ii) No Adjustment to Warrant Exercise Price. No adjustment to
the Warrant Exercise Price shall be made unless the consideration per share for
an Additional Share of Common Stock issued or deemed to be issued by the Company
is less than the Warrant Exercise Price in effect on the date of, and
immediately prior to, the issue of such Additional Share of Common Stock.



                (iii) Issue of Securities Deemed Issue of Additional Shares of
Common Stock.

                        (1) Options and Convertible Securities. In the event the
        Company at any time or from time to time after the Original Issue Date
        shall issue any Options or Convertible Securities or shall fix a record
        date for the determination of holders of any class of securities
        entitled to receive any such Options or Convertible Securities, then the
        maximum number of shares (as set forth in the instrument relating
        thereto without regard to any provisions contained therein for a
        subsequent adjustment of such number) of Common Stock issuable upon the
        exercise of such Options or, in the case of Convertible Securities and
        Options therefor, the conversion or exchange of such Convertible
        Securities, shall be deemed to be Additional Shares of Common Stock
        issued as of the time of such issue or, in case such a record date shall
        have been fixed, as of the close of business (Eastern Standard Time or
        Eastern Daylight Savings Time, if applicable) on such record date,
        provided that Additional Shares of Common Stock shall not be deemed to
        have been issued unless the consideration per share (determined pursuant
        to Subsection 1.05(A)(v) hereof) of such Additional Shares of Common
        Stock would be less than the Warrant Exercise Price in effect on the
        date of and immediately prior to such issue, or such record date, as the
        case may be, and provided further that in any such case in which
        Additional Shares of Common Stock are deemed to be issued:

                                (a) no further adjustment in the Warrant
                Exercise Price shall be made upon the subsequent issue of
                Convertible Securities or shares of Common Stock upon the
                exercise of such Options or conversion or exchange of such
                Convertible Securities;

                                (b) if such Options or Convertible Securities by
                their terms provide, with the passage of time or otherwise, for
                any increase in the Consideration as defined in Subsection
                1,05(A)(v) payable to the Company, or decrease in the number of
                shares of Common Stock issuable, upon the exercise, conversion
                or exchange thereof, the Warrant Exercise Price computed upon
                the original issue thereof (or upon the occurrence of a record
                date with respect thereto), and any subsequent adjustments based
                thereon, shall, upon any such increase or decrease becoming
                effective, be recomputed to reflect such increase or decrease
                insofar as it affects such Options or the rights of conversion
                or exchange under such Convertible Securities;

                                (c) upon the expiration of any such Options or
                any rights of conversion or exchange under such Convertible
                Securities which shall not have been exercised, the Warrant
                Exercise Price computed upon the original issue thereof (or upon
                the occurrence of a record date with respect thereto), and any
                subsequent adjustments based thereon, shall, upon such
                expiration, be recomputed as if:

                                        (i) In the case of Convertible
                Securities or Options for Common Stock the only Additional
                Shares of Common Stock issued were the shares of Common Stock,
                if any, actually issued upon the exercise



                of such Options or the conversion or exchange of such
                Convertible Securities and the consideration received therefor
                was the consideration actually received by the Company for the
                issue of all such Options, whether or not exercised, plus the
                consideration actually received by the Company upon such
                exercise, or for the issue of all such Convertible Securities
                which were actually converted or exchanged, plus the additional
                consideration, if any, actually received by the Company upon
                such conversion or exchange; and

                                        (ii) in the case of Options for
                Convertible Securities only the Convertible Securities, if any,
                actually issued upon the exercise thereof were issued at the
                time of issue of such Options, and the consideration received by
                the Company for the Additional Shares of Common Stock deemed to
                have been then issued was the consideration actually received by
                the Company for the issue of all such Options, whether or not
                exercised, plus the consideration deemed to have been received
                by the Company (determined pursuant to Subsection 1.05(A)(v))
                upon the issue of the Convertible Securities with respect to
                which such Options were actually exercised;

                        (d) no readjustment pursuant to clause (b) or (c) above
                shall have the effect of increasing the Warrant Exercise Price
                to an amount which exceeds the lower of (i) the Warrant Exercise
                Price on the original adjustment date, or (ii) the Warrant
                Exercise Price that would have resulted from any issuance of
                Additional Shares of Common Stock between the original
                adjustment date and such readjustment date;

                        (e) in the case of any Options which expire by their
                terms not more than thirty days after the date of issue thereof,
                no adjustment of the Warrant Exercise Price shall be made until
                the expiration or exercise of all such Options, whereupon such
                adjustment shall be made in the same manner provided in clause
                (c) above; and

                        (f) if such record date shall have been fixed and such
                options or Convertible Securities are not issued on the date
                fixed therefor, the adjustment previously made in the Warrant
                Exercise Price which became effective on such record date shall
                be canceled as of 8:00 P.M. Eastern Standard Time (or Eastern
                Daylight Savings Time if applicable) on such record date, and
                thereafter the Warrant Exercise Price shall be adjusted pursuant
                to this Subsection 1.05(A)(iii) as of the actual date of their
                issuance.

                (2) Stock Dividends, Stock Distributions and Subdivisions. In
the event the Company at any time or from time to time after the Original Issue
Date shall declare or pay any dividend or make any other distribution on the
Common Stock payable in Common Stock or effect a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise than by payment of a
dividend in Common Stock), then and in any such event, Additional Shares of
Common Stock shall be deemed to have been issued:



                                (a) in the case of any such dividend or
                        distribution, immediately after 8:00 P.M. (Eastern
                        Standard Time or Eastern Daylight Savings Time, if
                        applicable) on the record date for the determination of
                        holders of any class of securities entitled to receive
                        such dividend or distribution, or

                                (b) in the case of any such subdivision, at 8:00
                        P.M. (Eastern Standard Time or Eastern Daylight Savings
                        Time, if applicable) on the date immediately prior to
                        the date upon which such corporate action becomes
                        effective.

                        If such record date shall have been fixed and no part of
                        such dividend shall have been paid on the date fixed
                        therefor, the adjustment previously made in the Warrant
                        Exercise Price which became effective on such record
                        date shall be canceled as of 8:00 P.M. (Eastern Standard
                        Time or Eastern Daylight Savings time, if applicable) on
                        such record date, and thereafter the Warrant Exercise
                        Price shall be adjusted pursuant to this Section
                        1.05(A)(iii) as of the time of actual payment of such
                        dividend.

                        (iv) Adjustment to the Warrant Exercise Price Upon
Issuance of Additional Shares of Common Stock. In the event that at any time or
from time to time after the Original Issue Date, the Company shall issue
Additional Shares of Common Stock (including, without limitation, Additional
Shares of Common Stock deemed to be issued pursuant to Subsection
1.05(A)(iii)(1) but excluding Additional Shares of Common Stock deemed to be
issued pursuant to Subsection 1.05(A)(iii)(2), which event is dealt with in
Subsection 1.05(A)(vi)(1)), without consideration or for a consideration per
share less than the applicable Warrant Exercise Price in effect on the date of
and immediately prior to such issue, then and in such event, such Warrant
Exercise Price shall be reduced concurrently with such issue, to a price equal
to the Consideration Per Share for which such Additional Shares of Common Stock
are issued or deemed to be issued; provided that the applicable Warrant Exercise
Price shall not be so reduced at any time if the amount of such reduction would
be an amount less than $.01, but any such amount shall be carried forward and
reduction with respect thereto made at the time of and together with any
subsequent reduction which, together with such amount and any other amount or
amounts so carried forward, shall aggregate $.01 or more.

                        (v) Determination of Consideration. For purposes of this
Subsection 1.05(A), the consideration (the "Consideration") received or
receivable by the Company for the issue of any Additional Shares of Common Stock
shall be computed as follows:

                        (1) Cash and Property: Such Consideration shall:

                                        (a) insofar as it consists of cash, be
                        computed at the aggregate amounts of cash received by
                        the Company excluding amounts paid or payable for
                        accrued interest or accrued dividends;

                                        (b) insofar as it consists of property
                        other than cash, be computed at the fair value thereof
                        at the time of such issue, as determined in good faith
                        by the Board of Directors; and



                                        (c) in the event Additional Shares of
                        Common Stock are issued together with other shares or
                        securities or other assets of the Company for
                        consideration which covers both, be the proportion of
                        such consideration so received or receivable computed as
                        provided in Subsections 1.05(A)(v)(1)(a) and
                        1.05(A)(v)(1)(b) above, allocable to such Additional
                        Shares of Common Stock as determined in good faith by
                        the Board of Directors; provided, however, that in the
                        event warrants or other options to purchase shares of
                        Common Stock are issued without consideration or for a
                        nominal consideration contemporaneously with the
                        issuance of debt or preferred stock, or both, then the
                        consideration received by the Company for such debt or
                        preferred stock shall be deemed properly allocated to
                        the issuance of the warrants or options.

                        (2) Additional Shares of Common Stock other than Options
        and Convertible Securities. The Consideration per share (the
        "Consideration Per Share") for the issue of any Additional Shares of
        Common Stock other than Options and Convertible Securities shall be the
        Consideration for the issue of any Additional Shares of Common Stock
        other than Options or Convertible Securities, divided by the total
        number of such Additional Shares of Common Stock issued by the
        Corporation in exchange therefor.

                        (3) Options and Convertible Securities. The
        Consideration per share (also the "Consideration Per Share," as the
        context requires) for Additional Shares of Common Stock deemed to have
        been issued pursuant to Subsection 1.05(A)(iii)(1), relating to Options
        and Convertible Securities, shall be computed by dividing (x) the
        Consideration for the issue of such Options or Convertible Securities,
        plus the aggregate amount of additional Consideration (as set forth in
        the instruments relating thereto, without regard to any provision
        contained therein for a subsequent adjustment of such consideration)
        payable to the Company upon the exercise of such Options or the
        conversion or exchange of such Convertible Securities, or in the case of
        Options for Convertible Securities, the exercise of such Options for
        Convertible Securities and the conversion or exchange of such
        Convertible Securities, by (y) the number of shares of Common Stock (as
        set forth in the instruments relating thereto, without regard to any
        provision contained therein for a subsequent adjustment of such number)
        issuable upon the exercise of such Options or the conversion or exchange
        of such Convertible Securities.

                (vi) Adjustment of the Warrant Exercise Price for Dividends,
Distributions, Subdivisions, Combinations or Consolidations of Common Stock.

                        (1) Stock Dividends, Distributions or Subdivisions. In
        the event the Company shall be deemed to have issued Additional Shares
        of Common Stock pursuant to Subsection 1.05(A)(iii)(2) in a stock
        dividend, stock distribution or subdivision, the Warrant Exercise Price
        in effect immediately before such deemed issue shall, concurrently with
        the effectiveness of such deemed issue, be proportionately decreased.



                        (2) Combinations or Consolidations. In the event the
        outstanding shares of Common Stock shall be combined or consolidated, by
        reclassification or otherwise, into a lesser number of shares of Common
        Stock, the Warrant Exercise Price in effect immediately prior to such
        combination or consolidation shall, concurrently with the effectiveness
        of such combination or consolidation, be proportionately increased.

                (B) Adjustments for Certain Dividends and Distributions. In the
event that at any time or from time to time after the Original Issue Date the
Company shall make or issue, or fix a record date for the determination of
holders of Common Stock entitled to receive, a dividend or other distribution
payable in securities of the Company other than shares of Common Stock, then and
in each such event provision shall be made so that the holders of Stock Purchase
Warrants shall receive upon exercise thereof in addition to the number of shares
of Common Stock receivable thereupon, the amount of securities of the Company
that they would have received had their Stock Purchase Warrants been exercised
for Common Stock on the date of such event and had they thereafter, during the
period from the date of such event to and including the exercise date, retained
such securities receivable by them as aforesaid during such period, giving
application during such period to all adjustments called for herein.

                (C) Adjustment for Reclassification, Exchange, or Substitution.
In the event that at any time or from time to time after the Original Issue
Date, the Common Stock issuable upon the exercise of this Warrant shall be
changed into the same or a different number of shares of any class or classes of
stock, whether by capital reorganization, reclassification, or otherwise (other
than a subdivision or combination of shares or stock dividend provided for
above, or a merger, consolidation, or sale of assets provided for below), then
and in each such event the registered holder of this Warrant shall have the
right thereafter to exercise this Warrant for the kind and amount of shares of
stock and other securities and property receivable upon such reorganization,
reclassification, or other change, by holders of the number of shares of Common
Stock into which such Warrant might have been exercisable for immediately prior
to such reorganization, reclassification, or change, all subject to further
adjustment as provided herein.

                (D) Adjustment for Merger, Consolidation or Sale of Assets. In
the event that at any time or from time to time after the Original Issue Date,
the Company shall sell all or substantially all of its assets or merge or
consolidate with or into another entity, this Warrant shall thereafter be
exercisable for the kind and amount of shares of stock or other securities or
property to which a holder of the number of shares of Common Stock of the
Company deliverable upon exercise of this Warrant would have been entitled to
receive upon such consolidation, merger or sale; and, in such case, appropriate
adjustment (as determined in good faith by the Board of Directors) shall be made
in the application of the provisions in this Section 1.05 with respect to the
rights and interest thereafter of the registered holders of the Stock Purchase
Warrants, to the end that the provisions set forth in this Section 1.05
(including provisions with respect to changes in and other adjustments of the
Warrant Exercise Price) shall thereafter be applicable, as nearly as reasonably
may be, in relation to any shares of stock or other property thereafter
deliverable upon the exercise of this Warrant.

                (E) Adjustment upon Conversion of Amounts Due under Debenture.
In the event that at any time or from time to time after the Original Issue
Date, the registered holder



elects to convert all of the principal amount and interest thereon then
outstanding under the Debenture, dated as of the date of this Warrant, issued
and sold by the Company to the registered holder pursuant to the Purchase
Agreement (the "Debenture") into shares of Series A Convertible Preferred Stock,
par value $.001 per share, of the Company in accordance with the terms of the
Debenture, as the same may be amended from time to time, the number of
Exercisable Shares hereunder shall be reduced by 50%.

                (F) No Impairment. The Company shall not, by amendment of its
Certificate of Incorporation or By-Laws or through any reorganization, transfer
of-assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, including, without limitation, voluntary bankruptcy
proceedings, avoid or seek to avoid the observance or performance of any of the
terms to be observed or performed hereunder by the Company but shall at all
times in good faith assist in the carrying out of all the provisions of this
Section 1.05 and in the taking of all such action as may be necessary or
appropriate on order to protect the rights of the registered holder of this
Warrant against impairment.

                (G) Notice of Adjustment of the Warrant Exercise Price or Number
of Exercisable Shares. Upon the occurrence of each adjustment, readjustment or
other change relating to the Warrant Exercise Price or in the number of
Exercisable Shares, then, and in each such case, the Company at its expense
shall give written notice thereof, by first class mail, postage prepaid,
addressed to the registered holder at the address of such registered holder as
shown on the books of the Company, which notice shall state the Warrant Exercise
Price resulting from such adjustment and the increase or decrease in the number
of Exercisable Shares (or other denominations of securities) purchasable at the
Warrant Exercise Price upon the exercise of this Warrant setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based.

                (H) Notice. In case at any time: (1) the Company shall pay any
dividend or make any distribution (other than regular cash dividends from
earnings or earned surplus paid at an established rate) to the holders of its
Common Stock; (2) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any class or other
rights; (3) there shall be any capital reorganization or reclassification of the
capital stock of the Company, or consolidation or merger of the Company with or
sale of all or substantially all of its assets to another corporation; or (4)
there shall be a voluntary or involuntary dissolution, liquidation or winding up
of the Company; then, in any one or more of such cases, the Company shall give
written notice, by first class mail, postage prepaid, addressed to the
registered holder at the address of such registered holder as shown on the books
of the Company of the date on which (a) the books of the Company shall close or
a record date shall be fixed for determining the shareholders entitled to such
dividend, distribution or subscription rights, or (b) such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding up shall take place, as the case may be. Such notice shall also provide
reasonable details of the proposed transaction and specify the date as of which
the holders of Common Stock of record shall participate in such dividend,
distribution or subscription rights, or shall be entitled to exchange their
Common Stock for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding up, as the case may be. Such written notice shall be
given at least 20 days prior to the



action in question and not less than 20 days prior to the record date or the
date on which the Company's transfer books are closed in respect thereto.

                (I) Voting Rights. This Warrant shall not entitle the registered
holder to any voting rights or any other rights as a stockholder of the Company
but upon presentation of this Warrant with the subscription form annexed duly
executed and the tender of payment of the Warrant Exercise Price at the office
of the Company pursuant to the provisions of this Warrant the registered holder
shall forthwith be deemed a stockholder of the Company in respect of the shares
of Common Stock so subscribed and paid for.

                (J) No Change Necessary. The form of this Warrant need not be
changed because of any adjustment in the Warrant Exercise Price or in the number
of shares of Common Stock issuable upon its exercise. A Warrant issued after any
adjustment on any partial exercise or upon replacement may continue to express
the same Warrant Exercise Price and the same number of shares of Common Stock
(appropriately reduced in the case of partial exercise) as are stated on this
Warrant as initially issued, and that Warrant Exercise Price and that number of
shares shall be considered to have been so changed as of the close of business
on the date of adjustment.

        Section 2. Covenant of the Company. All shares of Common Stock which may
be issued upon the exercise of the rights represented by this Warrant, shall,
upon issuance, be duly authorized, validly issued, fully paid and non-assessable
and free from all taxes, liens and charges with respect to the issue thereof.

        Section 3. Fractional Shares. No fractional shares or scrip representing
fractional shares shall be issued upon exercise of this Warrant. If, upon
exercise of this Warrant as an entirety, the registered holder would, except for
the provisions of this Section 3, be entitled to receive a fractional share of
Common Stock, then the Company shall pay in cash to such registered holder an
amount equal to such fractional share multiplied by the fair market value of one
share of Common Stock (as reasonably determined by the Board of Directors of
the Company) on the date of such exercise.

        Section 4. Substitution. In case this Warrant shall be mutilated, lost,
stolen or destroyed, the Company will issue a new Warrant of like tenor and
denomination and deliver the same (a) in exchange and substitution for and
upon surrender and cancellation of any mutilated Warrant, or (b) in lieu of any
Warrant lost, stolen or destroyed, upon receipt of evidence satisfactory to the
Company of the loss, theft, or destruction of such Warrant (including a
reasonably detailed affidavit with respect to the circumstances of any loss,
theft or destruction), and of indemnity (or, in the case of the initial holder
or any other institutional holder, an indemnity agreement) satisfactory to the
Company.

        Section 5. Transfer Restrictions. This Warrant or the shares of Common
Stock into which this Warrant is exercisable shall not be sold, transferred,
pledged or hypothecated unless the proposed disposition is the subject of a
currently effective registration statement under the Securities Act of 1933, as
amended (the "Securities Act"), or unless the Company has received an opinion of
counsel reasonably satisfactory in form and scope to the Company that such
registration is not required except that such restrictions shall not apply to
any transfer of this



Warrant or the shares of Common Stock into which this Warrant is exercisable:
(i) to a partner or other affiliate of the registered holder, including any
entity of which the registered holder or a related entity is a General Partner;
(ii) by gift or bequest or through inheritance to, or for the benefit of, any
member or members of the registered holder's immediate family; (iii) by a
registered holder to a trust (a) in respect of which the registered holder
serves as trustee, provided that the trust instrument governing such trust shall
provide that the registered holder, as trustee, shall retain sole and exclusive
control over the voting and disposition of such Warrant until the termination of
this Warrant or (b) for the benefit solely of any member or members of the
registered holder's immediate family; and (iv) pursuant to any underwritten
public offering of Common Stock pursuant to an effective registration statement
under the Securities Act.

        Section 6. Remedies. The Company stipulates that the remedies at law of
the registered holder of this Warrant in the event of any default or threatened
default by the Company in the performance of or compliance with any of the terms
of this Warrant are not and will not be adequate, and that such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the terms
hereof or otherwise.

        Section 7. Taxes. The Company shall pay any taxes or other charges that
may be imposed in respect of the issuance and delivery of the Warrant or any
shares of Common Stock or other property upon exercise hereof.

        Section 8. Governing Law. This Warrant shall be deemed a contract made
under the laws of the State of Delaware and its provisions and the rights and
obligations of the parties hereunder shall be governed by, and construed and
enforced in accordance with, the substantive laws of the State of Delaware,
without regard to its principles of conflicts of laws.

        Section 9. Miscellaneous. This Warrant and any term hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought.


                                      ****



        IN WITNESS WHEREOF, the Company has caused this Common Stock Purchase
Warrant to be signed by its Chief Executive Officer thereunto duly authorized
and its corporate seal to be hereunto affixed and attested by its Secretary this
___ day of ________, 1999.

ATTEST:                                     NOVATEL WIRELESS, INC.


By: _______________________________         By: ________________________________
Name: Roger Hartman                         Name: Robert Corey
Its: Secretary                              Its: Chief Executive Officer



                                SUBSCRIPTION FORM

        The undersigned, the registered holder of the within Common Stock
Purchase Warrant, hereby irrevocably elects to exercise the purchase right
represented by such Warrant for, and to purchase thereunder, ______ shares of
Common Stock of Novatel Wireless, Inc., and herewith makes payment of $ ______
therefor and requests that the certificates representing such shares be issued
in the name of and delivered to:

__________________________________________________

__________________________________________________

__________________________________________________

and if such shares shall not include all of the shares issuable under this
Warrant, that a new Warrant of like tenor and date be delivered to the
undersigned for the shares not issued.

Dated: ____________________________         ___________________________________
                                            Signature



                               FORM OF ASSIGNMENT

For value received the undersigned hereby sells, assigns and transfers unto

________________________________ whose address is _______________________

________________________________________________________________________________

____________________________________________________________________, the within

Common Stock Purchase Warrant with respect to ________ shares purchasable

thereby, and does hereby irrevocably constitute and appoint ____________________

attorney to transfer such Warrant on the books of the within named corporation

with full power of substitution in the premises.

Dated: _____________________________________

In the presence of:


________________________                       _________________________
                                                Signature

EX-4.4

                                                                     EXHIBIT 4.4


THE WARRANT EVIDENCED HEREBY, AND THE SHARES OF COMMON STOCK ISSUABLE HEREUNDER,
HAVE BEEN AND WILL BE ISSUED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR THE APPLICABLE SECURITIES LAWS OF ANY STATE. SUCH
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION
OR RESALE, AND SHALL NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS
THE PROPOSED DISPOSITION IS THE SUBJECT OF A CURRENTLY EFFECTIVE REGISTRATION
STATEMENT UNDER SAID ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR UNLESS
THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER SAID ACT AND SUCH STATE SECURITIES LAWS IN CONNECTION WITH SUCH
DISPOSITION.

                             NOVATEL WIRELESS, INC.

                          COMMON STOCK PURCHASE WARRANT

                             Void After ______, 2005

                    This Stock Purchase Warrant is Issued to

                      [INSERT NAME AND ADDRESS OF GRANTEE]



(hereinafter called the "initial registered holder" or the "registered holder,"
which term shall include its successors and assigns) by Novatel Wireless, Inc.,
a Delaware corporation (hereinafter referred to as the "Company"). The holder of
this common stock purchase warrant ("Warrant") is entitled to certain of the
benefits conferred by that certain Series D Convertible Preferred Stock and
Warrant Purchase Agreement dated as of _______, 2000 (the "Purchase Agreement"),
and that certain Amended and Restated Investors' Rights Agreement dated as of
_______, 2000 (the "Investors' Rights Agreement"), copies of which are on file
at the office of the Company at the address specified below. This Warrant may be
transferred by the registered holder only in accordance with the provisions of
Section 1.06 and Section 5 hereof. A copy of the Purchase Agreement and the
Investors' Rights Agreement will be furnished to any subsequent registered
holder hereof upon written request. The Investors' Rights Agreement contains an
undertaking by the Company under certain circumstances to effect registration
and qualification under federal and state securities laws of, or to take other
action with respect to, the shares of common stock, par value $0.001, of the
Company ("Common Stock") issuable on exercise of this Warrant.






        Section 1. The Warrant.

        1.01. Manner of Exercise. For value received and subject to the terms
and conditions hereinafter set forth, the registered holder hereof is entitled,
upon surrender of this Warrant (with the subscription form annexed hereto duly
executed) at the office of the Company at 9360 Towne Centre Drive, Suite 110,
San Diego, CA 92121, or such other office of which the Company shall notify the
registered holder hereof in writing, to purchase from the Company _____ (_____)
fully paid and nonassessable shares ("Initial Exercisable Shares" and, as may be
adjusted from time to time as hereinafter provided, "Exercisable Shares") of
Common Stock for an initial exercise price of $17.25 per share as may be
adjusted from time to time as provided below (the "Warrant Exercise Price").
This Warrant may be exercised in full or in part from time to time when
exercisable. As promptly as practicable after surrender of this Warrant and
receipt of payment of the Warrant Exercise Price, the Company shall issue and
deliver to the registered holder a certificate or certificates for shares of
Common Stock, in certificates of such denominations and in such names as the
registered holder hereof may specify, together with any other stock, securities
or property which such holder may be entitled to receive pursuant to Sections
1.07(B), 1.07(C) or 1.07(D) hereof. In the case of the purchase of less than all
the shares purchasable under this Warrant, the Company shall cancel this Warrant
upon the surrender hereof and shall execute and deliver a substitute Warrant of
like tenor for the balance of the shares purchasable hereunder.

        1.02. Date of Exercisability. This Warrant may be exercised by its
registered holder on or after the earliest to occur of (i) the first anniversary
of the Closing (as defined in the Purchase Agreement) and prior to termination,
(ii) the closing of a firm commitment public offering pursuant to an effective
registration statement on Form S-1 under the Securities Act of 1933, as amended,
at a public offering price (prior to underwriting discounts and commissions)
equal to or exceeding $17.25 per share of Common Stock (as adjusted for any
stock dividends, combinations or splits with respect to such shares) and in
which the proceeds to the Company from such offering aggregate not less than $35
million (prior to underwriting discounts and commissions), or (iii) the
commencement of the 30-day period prior to the consummation of a transaction
effecting (a) the sale of all or substantially all the assets of the Company;
(b) the sale (other than in connection with financing arrangements) of capital
stock or other securities representing a majority of the total voting power of
shares of stock entitled to vote in the election of directors; or (c) a merger
consolidation or tender offer in which the Company is not the surviving entity
(hereinafter, a "Change in Control"). This Warrant shall expire at 8:00 P.M.
(Eastern Standard Time) on _______, 2005 and shall be void thereafter.

        1.03. Payment of Exercise Price; Net Issue Exercise

                A. The Warrant Exercise Price may be paid by cash, check, wire
transfer or by the surrender to the Company of promissory notes or other
instruments representing indebtedness of the Company to the registered holder.

                B. In lieu of exercising this Warrant in the manner provided
above in Section 1.03(A), the registered holder may elect to receive shares
equal to the then fair market value of this Warrant (or the portion thereof
being canceled) by surrender of this Warrant at the


                                       2


principal office of the Company together with notice of such election on the
subscription form appended hereto duly executed by such registered holder or
such registered holder's duly authorized attorney, in which event the Company
shall issue to the registered holder a number of shares of Common Stock computed
using the following formula:

               X =  Y (A - R)
                    ---------
                        A

Where          X = The number of shares of Common Stock to be issued to the
                   registered holder.

               Y = The number of shares of Common Stock purchasable under this
                   Warrant (at the date of such calculation).

               A = The fair market value of one share of Common Stock (at the
                   date of such calculation).

               B = The Warrant Exercise Price (as adjusted to the date of such
                   calculation).

                        (i) For purposes of this Section 1.03(B), the fair
market value of one share of Common Stock on the date of calculation shall mean:

                                (A) if the exercise is in connection with an
initial public offering of shares of the Company's Common Stock, and if the
Company's Registration Statement relating to such public offering has been
declared effective by the Securities and Exchange Commission, then the fair
market value per share of Common Stock shall be the initial "Price to Public"
specified in the final prospectus with respect to the offering;

                                (B) if this Warrant is exercised after, and not
in connection with, the close of the Company's initial public offering, and if
the Company's Common Stock is then traded on a securities exchange or The Nasdaq
Stock Market or actively traded over-the-counter:

                                        (1) if the Company's Common Stock is
traded on a securities exchange or The Nasdaq Stock Market, the fair market
value shall be deemed to be the average of the closing price per share over the
twenty (20) day period ending three days before the date of calculation; or

                                        (2) if the Company's Common Stock is
actively traded over-the-counter, the fair market value per share of the
Company's common stock shall be deemed to be the average of the closing bid or
sales price (whichever is applicable) over the thirty (30) day period ending
three days before the date of calculation; or

                                (C) if neither (A) nor (B) is applicable, the
fair market value per share of the Company's Common Stock shall be the amount
determined in good faith by the Company's Board of Directors, unless the Company
is, at such time, within the thirty (30) consecutive day period immediately
preceding the consummation of a Change in Control in which case the fair market
value per share of Common Stock shall be deemed to be the value of


                                       3


the consideration per share received by the holders of such stock pursuant to
such consummation of a Change in Control.

        1.04. During the period within which the rights represented by this
Warrant may be exercised, the Company shall at all times have authorized and
reserved for the purpose of issue upon exercise of the rights evidenced hereby,
a sufficient number of shares of its Common Stock to provide for the exercise of
such rights. Upon surrender for exercise, this Warrant shall be canceled and
shall not be reissued; provided, however, that upon the partial exercise hereof
a substitute Warrant representing the rights to subscribe for and purchase any
such unexercised portion hereof shall be issued.

        1.05. Subject to compliance with applicable securities laws, this
Warrant may be subdivided into one or more common stock purchase warrants
entitling the registered holder to purchase shares of Common Stock in multiples
of one or more whole shares, upon surrender of this Warrant by the registered
holder for such purpose at the office of the Company,

        1.06. The Company shall maintain at its office (or at such other office
or agency of the Company as it may from time to time designate in writing to the
registered holder hereof), a register containing the names and addresses of the
holders of all the Company's common stock purchase warrants. The registered
holder of such a warrant shall be the person in whose name such warrant is
originally issued and registered, unless a subsequent holder shall have
presented to the Company such warrant, duly assigned to him, for inspection and
a written notice of his acquisition of such warrant and designating in writing
the address of such holder, in which case such subsequent holder of the warrant
shall become a subsequent registered holder. Any registered holder of this
Warrant may change his address as shown on such register by written notice to
the Company requesting such change. Any written notice required or permitted to
be given to the registered holder of this Warrant shall be mailed, by registered
or certified mail, to such registered holder at his address as shown on such
register.

        1.07. The rights of the registered holder hereof shall be subject to the
following terms and conditions:

                (A) Adjustment to the Warrant Exercise Price.

                        (i) Special Definitions. For purposes of this Subsection
1.07, the following definitions shall apply:

                              (1) "Option" shall mean rights, options or
        warrants to subscribe for, purchase or otherwise acquire either Common
        Stock or Convertible Securities.

                              (2) "Warrant Exercise Price" shall mean initially
        $17.25 per share of Common Stock and shall be subject to adjustment as
        hereinafter provided.

                              (3) "Original Issue Date" shall mean the date on
        which this Warrant was issued.

                              (4) "Stock Purchase Warrants" shall mean the
        Warrants sold by the Company pursuant to the Purchase Agreement.


                                       4


                              (5) "Series D Purchase Price" shall mean $17.25
        per share of the Company's Series D Convertible Preferred Stock, par
        value $0.001 per share ("Exercise D Preferred Stock").

                              (6) "Converted Securities" shall mean any
        evidences of indebtedness, shares of capital stock (other than Common
        Stock) or other securities directly or indirectly convertible into or
        exchangeable for Common Stock.

                              (7) "Additional Shares of Common Stock" shall mean
        any shares of Common Stock issued (or, pursuant to Subsection
        1.07(A)(iii), deemed to be issued) by the Company after the Original
        Issue Date, other than:

                                        (a) shares of Common Stock issuable upon
        the exercise or conversion of securities of the Company outstanding as
        of the Original Issue Date;

                                        (b) shares of Common Stock issuable upon
        conversion of up to 2,263,857 shares of Series A Preferred Stock and up
        to 1,251,798 shares of Series A Preferred Stock (appropriately adjusted
        to take account of any stock split, stock dividend, combination of
        shares or the like) to be issued upon exchange of shares of the Series A
        preferred stock of Novatel Wireless Technologies, Ltd. (the "NWT
        Exchangeable Series A");

                                        (c) shares of Common Stock issuable upon
        conversion of up to 2,084,281 shares of Series B Preferred Stock and up
        to 213,614 shares of Series B Preferred Stock (appropriately adjusted to
        take account of any stock split, stock dividend, combination of shares
        or the like) to be issued upon exchange of the shares of the Series B
        preferred stock of NWT (the "NWT Exchangeable Series B");

                                        (d) up to 330,105 shares of Common Stock
        (appropriately adjusted to take account of any stock split, stock
        dividend, combination of shares or the like) to be issued upon exercise
        of warrants issued by NWT to purchase shares of the exchangeable common
        stock of NWT (the "NWT Exchangeable Common");

                                        (e) up to 781,605 shares of Common Stock
        issuable upon exercise of the warrants granted to certain investors
        pursuant to the Series B Stock Purchase Agreement;

                                        (f) up to 1,308,057 shares of Common
        Stock issuable upon exercise of warrants granted to certain investors
        pursuant to that certain Unit Purchase Agreement dated as of June 15,
        1999;

                                        (g) shares of Common Stock issuable upon
        the conversion of up to 3,698,087 shares of the Series C Preferred
        Stock;


                                       5


                                        (h) up to 716,213 shares of Common Stock
        issuable upon exercise of warrants granted to certain investors pursuant
        to the Series C Stock Purchase Agreement and ancillary transactions;

                                        (i) any issuance of securities for which
        adjustment of the Series C Conversion Price is made pursuant to
        Subsection 3(h);

                                        (j) shares of Common Stock issuable upon
        the conversion of up to 2,600,000 shares of Series D Preferred Stock;

                                        (k) up to 520,000 shares of Common Stock
        issuable upon exercise of warrants granted to certain investors pursuant
        to the Series D Stock Purchase Agreement;

                                        (l) any minimum number of shares of
        capital stock required by law to be issued to directors of the Company;

                                        (m) securities issued or issuable as a
        dividend or distribution on the Preferred Stock;

                                        (n) up to 2,000,000 shares of the Common
        Stock (or related options)(appropriately adjusted to take account of any
        stock split, stock dividend, combination of shares or the like), or such
        higher number of shares (or options) as is recommended by the
        Compensation Committee of the Company's Board of Directors and approved
        by the Company's Board of Directors, issued or issuable to officers,
        directors or employees of, or consultants to, the Company's pursuant to
        a stock purchase or option or warrant plan or other similar arrangement
        approved by the Board of Directors;

                                        (o) securities (or securities issued
        upon the exercise of securities) issued in connection with financing
        arrangements with lending institutions or equipment leasing
        arrangements;

                                        (p) any shares of capital stock of the
        Company, not to exceed one-half of one percent of the total issued and
        outstanding capital stock of the Company on an "as converted to Common
        Stock" basis, the issuance of which is approved by vote of a majority of
        the Board of Directors of the Company, including the affirmative vote of
        a majority of the directors designated for election by the holders of
        the Series D Preferred Stock; and

                                        (q) not more than ten shares of capital
        stock of the Company on an "as converted to Common Stock" basis, the
        issuance of which resulted from mathematical or other error or
        inadvertence, provided that the transaction in which such shares were
        issued was approved at the time by vote of a majority of the Board of
        Directors of the Company, including the affirmative vote of a majority
        of the directors designated for election by the holders of the Series D
        Preferred Stock.


                                       6


                (ii) No Adjustment to Warrant Exercise Price. Except as set
forth in Subsection 1.07(A)(vi), no adjustment to the Warrant Exercise Price
shall be made unless the consideration per share for an Additional Share of
Common Stock issued or deemed to be issued by the Company is less than the
Series D Purchase Price.

                (iii) Issue of Securities Deemed Issue of Additional Shares of
Common Stock.

                      (1) Options an Convertible Securities. In the event the
        Company at any time or from time to time after the Original Issue Date
        shall issue any Options or Convertible Securities or shall fix a record
        date for the determination of holders of any class of securities
        entitled to receive any such Options or Convertible Securities, then the
        maximum number of shares (as set forth in the instrument relating
        thereto without regard to any provisions contained therein for a
        subsequent adjustment of such number) of Common Stock issuable upon the
        exercise of such Options or, in the case of Convertible Securities and
        Options therefor, the conversion or exchange of such Convertible
        Securities, shall be deemed to be Additional Shares of Common Stock
        issued as of the time of such issue or, in case such a record date shall
        have been fixed, as of the close of business (Eastern Standard Time or
        Eastern Daylight Savings Time, if applicable) on such record date,
        provided that Additional Shares of Common Stock shall not be deemed to
        have been issued unless the consideration per share (determined pursuant
        to Subsection 1.07(A)(v) hereof) of such Additional Shares of Common
        Stock would be less than the Series D Purchase Price in effect on the
        date of and immediately prior to such issue, or such record date, as the
        case may be, and provided further that in any such case in which
        Additional Shares of Common Stock are deemed to be issued:

                          (a) no further adjustment in the Warrant Exercise
                Price shall be made upon the subsequent issue of Convertible
                Securities or shares of Common Stock upon the exercise of such
                Options or conversion or exchange of such Convertible
                Securities;

                          (b) if such Options or Convertible Securities by their
                terms provide, with the passage of time or otherwise, for any
                increase in the Consideration (as defined in Subsection
                1.07(A)(v)) payable to the Company, or decrease in the number of
                shares of Common Stock or Convertible Securities issuable, upon
                the exercise, conversion or exchange thereof, the Warrant
                Exercise Price computed upon the original issue thereof (or upon
                the occurrence of a record date with respect thereto), and any
                subsequent adjustments based thereon, shall, upon any such
                increase or decrease becoming effective, be recomputed to
                reflect such increase or decrease insofar as it affects such
                Options or the rights of conversion or exchange under such
                Convertible Securities;

                          (c) upon the expiration of any such Options or any
                rights of conversion or exchange under such Convertible
                Securities which shall not have been exercised, the Warrant
                Exercise Price computed upon the original issue thereof (or upon
                the occurrence of a record date with respect thereto), and


                                       7


                any subsequent adjustments based thereon, shall, upon such
                expiration, be recomputed as if:

                              (i) in the case of Convertible Securities or
                Options for Common Stock, the only Additional Shares of Common
                Stock issued were the shares of Common Stock, if any, actually
                issued upon the exercise of such Options or the conversion or
                exchange of such Convertible Securities and the consideration
                received therefor was the consideration actually received by the
                Company for the issue of all such Options, whether or not
                exercised, plus the consideration actually received by the
                Company upon such exercise, or for the issue of all such
                Convertible Securities which were actually converted or
                exchanged, plus the additional consideration, if any, actually
                received by the Company upon such conversion or exchange; and

                              (ii) in the case of Options for Convertible
                Securities only the Convertible Securities, if any, actually
                issued upon the exercise thereof were issued at the time of
                issue of such Options, and the consideration received by the
                Company for the Additional Shares of Common Stock deemed to have
                been then issued was the consideration actually received by the
                Company for the issue of all such Options, whether or not
                exercised, plus the consideration deemed to have been received
                by the Company (determined pursuant to Subsection 1.07(A)(v))
                upon the issue of the Convertible Securities with respect to
                which such Options were actually exercised;

                        (d) no readjustment pursuant to clause (b) or (c) of
                this Section 1.07(A)(iii) shall have the effect of increasing
                the Warrant Exercise Price to an amount which exceeds the lower
                of (i) the Warrant Exercise Price on the original adjustment
                date, or (ii) the Warrant Exercise Price that would have
                resulted from any issuance of Additional Shares of Common Stock
                between the original adjustment date and such readjustment date;

                        (e) in the case of any Options which expire by their
                teens not more than thirty days after the date of issue thereof,
                no adjustment of the Warrant Exercise Price shall be made until
                the expiration or exercise of all such Options, whereupon such
                adjustment shall be made in the same manner provided in clause
                (c) of this Section 1.07(A)(iii); and

                        (f) if such record date shall have been fixed and such
                Options or Convertible Securities are not issued on the date
                fixed therefor, the adjustment previously made in the Warrant
                Exercise Price which became effective on such record date shall
                be canceled as of 8:00 P.M. Eastern Standard Time (or Eastern
                Daylight Savings Time if applicable) on such record date, and
                thereafter the Warrant Exercise Price shall be adjusted pursuant
                to this Subsection 1.07(A)(iii) as of the actual date of their
                issuance.

                   (2) Stock Dividends, Stock Distributions and Subdivisions. In
        the event the Company at any time or from time to time after the
        Original Issue Date


                                       8


        shall declare or pay any dividend or make any other distribution on the
        Common Stock payable in Common Stock or effect a subdivision of the
        outstanding shares of Common Stock (by reclassification or otherwise
        than by payment of a dividend in Common Stock), then and in any such
        event, Additional Shares of Common Stock shall be deemed to have been
        issued:

                        (a) in the case of any such dividend or distribution,
                immediately after 8:00 P.M. (Eastern Standard Time or Eastern
                Daylight Savings Time, if applicable) on the record date for the
                determination of holders of any class of securities entitled to
                receive such dividend or distribution, or

                        (b) in the case of any such subdivision, at 8:00 P.M.
                (Eastern Standard Time or Eastern Daylight Savings Time, if
                applicable) on the date immediately prior to the date upon which
                such corporate action becomes effective.

                        If such record date shall have been fixed and no part of
                such dividend shall have been paid on the date fixed therefor,
                the adjustment previously made in the Warrant Exercise Price
                which became effective on such record date shall be canceled as
                of 8:00 P.M. (Eastern Standard Time or Eastern Daylight Savings
                time, if applicable) on such record date, and thereafter the
                Warrant Exercise Price shall be adjusted pursuant to this
                Section 1.07(A)(iii) as of the time of actual payment of such
                dividend.

        Adjustment to the Warrant Exercise rice Upon Issuance of Additional
Shares of Common Stock. In the event that at any time or from time to time after
the Original Issue Date, the Company shall issue Additional Shares of Common
Stock (including, without limitation, Additional Shares of Common Stock deemed
to be issued pursuant to Subsection 1.07(A)(iii)(1), but excluding Additional
Shares of Common Stock deemed to be issued pursuant to Subsection
1.07(A)(iii)(2), which event is dealt with in Subsection 1.07(A)(vi)(1)),
without consideration or for consideration per share less than the Series D
Purchase Price, then and in such event, if the consideration per share for which
such Additional Shares of Common Stock are issued or deemed issued is below
$17.25, the Warrant Exercise Price shall be reduced, concurrently with such
issue, to a price (calculated to the nearest cent) determined by multiplying
$17.25 by a fraction, the numerator of which shall be the number of shares of
Common Stock outstanding immediately prior to such issue plus the number of
shares of Common Stock which the aggregate consideration received by the Company
for the total number of Additional Shares of Common Stock so issued would
purchase at $17.25 per share, and the denominator of which shall be the number
of shares of Common Stock outstanding immediately prior to such issue plus the
number of such Additional Shares of Common Stock so issued. For the purpose of
the above calculation, the number of shares of Common Stock outstanding
immediately prior to such issue shall be calculated on a fully diluted basis, as
if all shares of Series A Preferred Stock (including the NWT Exchangeable Series
A), Series B Preferred Stock (including the NWT Exchangeable Series B), Series C
Preferred Stock (including the Series C Warrant Shares) and Series D Preferred
Stock, the NWT Exchangeable Common, and all Options and Convertible Securities
had been fully converted into, or exercised, or exchanged for shares of Common
Stock immediately prior to such issuance (and the resulting securities fully
converted into shares of


                                       9


Common Stock, if so convertible) as of such date, but not including in such
calculation any additional shares of Common Stock issuable with respect to
shares of Series A Preferred Stock, Series B Preferred Stock, Series C Preferred
Stock, Series D Preferred Stock, Options Convertible Securities, or other rights
for the purchase of shares of stock or convertible securities, solely as a
result of the adjustment of the Series A Conversion Price, Series B Conversion
Price, Series C Conversion Price or Series D Conversion Price (or other
conversion ratios) pursuant to the Company's Amended and Restated Certificate of
Incorporation resulting from the issuance of the Additional Shares of Common
Stock causing the adjustment in question.

            (iv) Determination of Consideration. For purposes of this Subsection
1.07(A), the consideration (the "Consideration") received or receivable by the
Company for the issue of any Additional Shares of Common Stock shall be computed
as follows:

                (1) Cash and Property: Such Consideration shall:

                        (a) insofar as it consists of cash, be computed at the
                aggregate amounts of cash received by the Company excluding
                amounts paid or payable for accrued interest or accrued
                dividends;

                        (b) insofar as it consists of property other than cash,
                be computed at the fair value thereof at the time of such issue,
                as determined in good faith by the Company's Board of Directors;
                and

                        (c) in the event Additional Shares of Common Stock are
                issued together with other shares or securities or other assets
                of the Company for consideration which covers both, be the
                proportion of such consideration so received or receivable
                computed as provided in Subsections 1.07(A)(v)(1)(a) and
                1.07(A)(v)(1)(b) above, allocable to such Additional Shares of
                Common Stock as determined in good faith by the Company's Board
                of Directors; provided, however, that in the event warrants or
                other options to purchase shares of Common Stock are issued
                without consideration or for a nominal consideration
                contemporaneously with the issuance of debt or preferred stock,
                or both, then the consideration received by the Company for such
                debt or preferred stock shall be deemed properly allocated to
                the issuance of the warrants or options.

                (2) Additional Shares of Common Sock other Options and
        Convertible Securities. The Consideration per share for the issue of any
        Additional Shares of Common Stock other than Options and Convertible
        Securities shall be the Consideration for the issue of any Additional
        Shares of Common Stock other than Options or Convertible Securities,
        divided by the total number of such Additional Shares of Common Stock
        issued by the Company in exchange therefor.

                (3) Options and Convertible Securities. The Consideration per
        share for Additional Shares of Common Stock deemed to have been issued
        pursuant to Subsection 1.07(A)(iii)(1), relating to Options and
        Convertible Securities, shall be computed by dividing (x) the
        Consideration for the issue of such Options or Convertible Securities,
        plus the aggregate amount of additional Consideration (as set forth in
        the


                                       10


        instruments relating thereto, without regard to any provision contained
        therein for a subsequent adjustment of such Consideration) payable to
        the Company upon the exercise of such Options or the conversion or
        exchange of such Convertible Securities, or in the case of Options for
        Convertible Securities, the exercise of such Options for Convertible
        Securities and the conversion or exchange of such Convertible
        Securities, by (y) the number of shares of Common Stock (as set forth in
        the instruments relating thereto, without regard to any provision
        contained therein for a subsequent adjustment of such number) issuable
        upon the exercise of such Options or the conversion or exchange of such
        Convertible Securities.

                        (v) Adjustment of the Warrant Exercise Price for
Dividends, Distributions, Subdivisions, Combinations or Consolidations of Common
Stock.

                              (1) Stock Dividends, Distributions or
        Subdivisions. In the event the Company shall be deemed to have issued
        Additional Shares of Common Stock pursuant to Subsection 1.07(A)(iii)(2)
        in a stock dividend, stock distribution or subdivision, the Warrant
        Exercise Price in effect immediately before such deemed issue shall,
        concurrently with the effectiveness of such deemed issue, be
        proportionately decreased.

                              (2) Combinations or Consolidations. In the event
        the outstanding shares of Common Stock shall be combined or
        consolidated, by reclassification or otherwise, into a lesser number of
        shares of Common Stock, the Warrant Exercise Price in effect immediately
        prior to such combination or consolidation shall, concurrently with the
        effectiveness of such combination or consolidation, be proportionately
        increased.

                (B) Adjustments for Certain Dividends and Distributions. In the
event that at any time or from time to time after the Original Issue Date the
Company shall make or issue, or fix a record date for the determination of
holders of Common Stock entitled to receive, a dividend or other distribution
payable in securities of the Company other than shares of Common Stock, then and
in each such event provision shall be made so that the holder of this Warrant
shall receive upon exercise thereof in addition to the number of shares of
Common Stock receivable thereupon, the amount of securities of the Company that
they would have received had this Warrant been exercised for Common Stock on the
date of such event and had they thereafter, during the period from the date of
such event to and including the exercise date, retained such securities
receivable by them as aforesaid during such period, giving application during
such period to all adjustments called for herein.

                (C) Adjustment for Reclassification, Exchange, or
Substitution. In the event that at any time or from time to time after the
Original Issue Date, the Common Stock issuable upon the exercise of this Warrant
shall be changed into the same or a different number of shares of any class or
classes of stock, whether by capital reorganization, reclassification, or
otherwise (other than a subdivision or combination of shares or stock dividend
provided for above, or a merger, consolidation, or sale of assets provided for
below), then and in each such event the registered holder of this Warrant shall
have the right thereafter to exercise this Warrant for the kind and amount of
shares of stock and other securities and property receivable upon such


                                       11


reorganization, reclassification, or other change, by holders of the number of
shares of Common Stock into which such Warrant might have been exercisable
immediately prior to such reorganization, reclassification, or change, all
subject to further adjustment as provided herein.

                (D) Adjustment for Merger, Consolidation or Sale of Assets. In
the event that at any time or from time to time after the Original Issue Date,
the Company shall sell all or substantially all its assets or merge or
consolidate with or into another entity, this Warrant shall thereafter be
exercisable for the kind and amount of shares of stock or other securities or
property which a holder of the number of shares of Common Stock of the Company
assumable upon exercise of this Warrant would have been entitled to receive upon
such consolidation, merger or sale; and, in such case, appropriate adjustment
(as determined in good faith by the Board of Directors) shall be made in the
application of the provisions in this Section 1.07 with respect to the rights
and interest thereafter of the registered holder of this Warrant, to the end
that the provisions set forth in this Section 1.07 (including provisions with
respect to changes in and other adjustments of the Warrant Exercise Price) shall
thereafter be applicable, as nearly as reasonably may be, in relation to any
shares of stock or other property thereafter deliverable upon the exercise of
this Warrant.

                (E) No Impairment. The Company shall not, by amendment of its
Certificate of Incorporation or Bylaws or through any reorganization, transfer
of assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, including, without limitation, voluntary bankruptcy
proceedings, avoid or seek to avoid the observance or performance of any of the
terms to be observed or performed hereunder by the Company but shall at all
times in good faith assist in the carrying out of all the provisions of this
Section 1.07 and in the taking of all such action as may be necessary or
appropriate on order to protect the rights of the registered holder of this
Warrant against impairment.

                (F) Notice of Adjustment of the Warrant Exercise Price or Number
of Exercisable Shares. Upon the occurrence of each adjustment, readjustment or
other change relating to the Warrant Exercise Price or in the number of
Exercisable Shares, then, and in each such case, the Company at its expense
shall give written notice thereof, by first class mail, postage prepaid,
addressed to the registered holder at the address of such registered holder as
shown on the books of the Company, which notice shall state the Warrant Exercise
Price resulting from such adjustment and the increase or decrease in the number
of Exercisable Shares (or other denominations of securities) purchasable at the
Warrant Exercise Price upon the exercise of this Warrant setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based.

                (G) Notice. In case at any time: (1) the Company shall pay any
dividend or make any distribution (other than regular cash dividends from
earnings or earned surplus paid at an established rate) to the holders of its
Common Stock; (2) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any class or other
rights; (3) there shall be any capital reorganization or reclassification of the
capital stock of the Company, or consolidation or merger of the Company with or
sale of all or substantially all its assets to another corporation; or (4) there
shall be a voluntary or involuntary dissolution, liquidation or winding up of
the Company; then, in any one or more of such enumerated cases, the Company
shall give written notice, by first class mail, postage prepaid,


                                       12


addressed to the registered holder at the address of such registered holder as
shown on the books of the Company on the date on which (a) the books of the
Company shall close or a record date shall be fixed for determining the
shareholders entitled to such dividend, distribution or subscription rights, or
(b) such reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up shall take place, as the case may be.
Such notice shall also provide reasonable details of the proposed transaction
and specify the date as of which the holders of Common Stock of record shall
participate in such dividend, distribution or subscription rights, or shall be
entitled to exchange their Common Stock for securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up, as the case may be. Such written
notice shall be given at least 20 calendar days prior to the action in question
and not fewer than 20 calendar days prior to the record date or the date on
which the Company's transfer books are closed in respect thereto.

                (H) Voting Rights. This Warrant shall not entitle its registered
holder to any voting rights or any other rights as a stockholder of the Company,
but upon presentation of this Warrant with the subscription form annexed duly
executed and the tender of payment of the Warrant Exercise Price at the office
of the Company pursuant to the provisions of this Warrant the registered holder
shall forthwith be deemed a stockholder of the Company in respect of the shares
of Common Stock so subscribed and paid for.

                (I) No Change Necessary. The form of this Warrant need not be
changed because of any adjustment in the Warrant Exercise price or in the number
of shares of Common Stock issuable upon its exercise. A Warrant issued after any
adjustment on any partial exercise or upon replacement may continue to express
the same Warrant Exercise Price and the same number of shares of Common Stock
(appropriately reduced in the case of partial exercise) as are stated on this
Warrant as initially issued, and that Warrant Exercise Price and that number of
shares shall be considered to have been so changed as of the close of business
on the date of adjustment.

        Section 2. Covenant of the Company. All shares of Common Stock which may
be issued upon the exercise of the rights represented by this Warrant, shall,
upon issuance, be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges with respect to the issue thereof.

        Section 3. Fractional Shares. No fractional shares or scrip representing
fractional shares shall be issued upon exercise of this Warrant. If, upon
exercise of this Warrant as an entirety, its registered holder would, except for
the provisions of this Section 3, be entitled to receive a fractional share of
Common Stock, then the Company shall pay in cash to such registered holder an
amount equal to such fractional share multiplied by the fair market value of one
share of Common Stock (as reasonably determined by the Board of Directors of the
Company) on the date of such exercise,

        Section 4. Substitution. In case this Warrant shall be mutilated, lost,
stolen or destroyed, the Company will issue a new Warrant of like tenor and
denomination and deliver the same (a) in exchange and substitution for and upon
surrender and cancellation of any mutilated Warrant, or (b) in lieu of any
Warrant lost, stolen or destroyed, upon receipt of evidence satisfactory to the
Company of the loss, theft, or destruction of such Warrant (including a


                                       13


reasonably detailed affidavit with respect to the circumstances of any loss,
theft or destruction), and of indemnity (or, in the case of the initial
registered holder or any other institutional holder, an indemnity agreement)
satisfactory to the Company.

        Section 5. Transfer Restrictions. This Warrant or the shares of Common
Stock into which this Warrant is exercisable shall not be sold, transferred,
pledged or hypothecated unless the proposed disposition is the subject of a
currently effective registration statement under the Securities Act, or unless
the Company has received an opinion of counsel reasonably satisfactory in form
and scope to the Company that such registration is not required except that such
restrictions shall not apply to any transfer of this Warrant or the shares of
Common Stock into which this Warrant is exercisable: (i) to a partner or other
affiliate of the registered holder, including any entity of which the registered
holder or a related entity is a general partner; (ii) by gift or bequest or
through inheritance to, or for the benefit of, any member or members of the
registered holder's immediate family; (iii) by a registered holder to a trust
(a) in respect of which the registered holder serves as trustee, provided that
the trust instrument governing such trust shall provide that the registered
holder, as trustee, shall retain sole and exclusive control over the voting and
disposition of such Warrant until the termination of this Warrant or (b) for the
benefit solely of any member or members of the registered holder's immediate
family; and (iv) pursuant to any underwritten public offering of Common Stock
pursuant to an effective registration statement under the Securities Act.

        Section 6. Taxes. The Company shall pay any taxes or other charges that
may be imposed in respect of the issuance and delivery of the Warrant or any
shares of Common Stock or other property upon exercise hereof.

        Section 7. Governing Law. This Warrant shall be deemed a contract made
under the laws of the State of Delaware and its provisions and the rights and
obligations of the parties hereunder shall be governed by, and construed and
enforced in accordance with, the substantive laws of the State of Delaware,
without regard to its principles of conflicts of laws.

        Section 8. Miscellaneous. This Warrant and any term hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought,

                            [Signature Page Follows]



                                       14

EX-4.5

                                                                     EXHIBIT 4.5


THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED OR ANY APPLICABLE STATE SECURITIES LAW,
AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE
REGISTRATION THEREOF UNDER SUCH ACT OR PURSUANT TO RULE 144 AND AN EXEMPTION
UNDER APPLICABLE STATE LAW OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
THE CORPORATION AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.

                           WARRANT TO PURCHASE STOCK

Corporation:             Novatel Wireless, Inc.
Number of Shares:        250,000 (subject to increase to 500,000 as provided
                         for below)
Class of Stock:          Common Stock
Initial Exercise Price:  $0.83 (equal to the average closing price per share of
                         Common Stock of the Company for the 30 trading days
                         immediately preceding the Issue Date of this Warrant)
Issue Date:              November 29, 2001
Expiration Date:         November 29, 2008

     THIS WARRANT CERTIFIES THAT, for the agreed upon value of $1.00 and for
other good and valuable consideration, SILICON VALLEY BANK ("Holder") is
entitled to purchase the number of fully paid and nonassessable shares of the
class of securities (the "Shares") of the corporation (the "Company") at the
initial exercise price per Share (the "Warrant Price") all as set forth above
and as adjusted pursuant to Article 2 of this Warrant, subject to the
provisions and upon the terms and conditions set forth in this Warrant.*

*THE NUMBER OF SHARES SET FORTH ABOVE SHALL AUTOMATICALLY INCREASE FROM 250,000
TO 500,000 AT SUCH TIME AS THE FIRST OF THE FOLLOWING SHALL OCCUR: (i) THE
COMPANY RECEIVES AT LEAST $5,000,000 CONSIDERATION FOR THE ISSUANCE OF EQUITY
SECURITIES OF THE COMPANY AFTER THE ISSUE DATE OF THIS WARRANT OR (ii) THE
HOLDER INCREASES THE $2 MILLION CAP (AS DEFINED IN THAT CERTAIN LOAN AND
SECURITY AGREEMENT OF APPROXIMATE EVEN DATE BETWEEN THE COMPANY AND HOLDER (AS
AMENDED FROM TIME TO TIME, THE "LOAN AGREEMENT")) OR $3.5 MILLION CAP (AS
DEFINED IN THE LOAN AGREEMENT), WHICHEVER IS APPLICABLE, TO EITHER THE $5
MILLION CAP (AS DEFINED IN THE LOAN AGREEMENT) OR THE MAXIMUM CREDIT LIMIT (AS
DEFINED IN THE LOAN AGREEMENT) PURSUANT TO THE TERMS OF THE LOAN AGREEMENT.

ARTICLE 1. EXERCISE.

          1.1 Method of Exercise. Holder may exercise this Warrant by
delivering a duly executed Notice of Exercise in substantially the form
attached as Appendix 1 to the principal office of the Company. Unless Holder is
exercising the conversion right set forth in Section 1.2. Holder shall also
deliver to the Company a check for the aggregate Warrant Price for the Shares
being purchased.

          1.2 Conversion Right. In lieu of exercising this Warrant as specified
in Section 1.1, Holder may from time to time convert this Warrant, in whole or
in part, into a number of Shares determined by dividing (a) the aggregate fair
market value of the Shares or other securities otherwise issuable upon exercise
of this Warrant minus the aggregate Warrant Price of such Shares by (c) the fair
market value of one Share. The fair market value of the Shares shall be
determined pursuant to Section 1.3.

          1.3 Fair Market Value. If the Shares are traded in a public market,
the fair market value of the Shares shall be the closing price of the Shares
(or the closing price of the

                                       1


Company's stock into which the Shares are convertible) reported for the
business day immediately before Holder delivers its Notice of Exercise to the
Company. If the Shares are not traded in a public market, the Board of
Directors of the Company shall determine fair market value in its reasonable
good faith judgment.

     1.4  Delivery of Certificate and New Warrant. Promptly after Holder
exercises or converts this Warrant, the Company shall deliver to Holder
certificates for the Shares acquired and, if this Warrant has not been fully
exercised or converted and has not expired, a new Warrant representing the
Shares not so acquired.

     1.5  Replacement of Warrants. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of loss, theft or destruction, on delivery of an
indemnity agreement reasonably satisfactory in form and amount to the Company
or, in the case of mutilation, or surrender and cancellation of this Warrant,
the Company shall execute and deliver, in lieu of this Warrant, a new warrant
of like tenor.

     1.6  Assumption on Sale, Merger, or Consolidation of the Company.

          1.6.1 "Acquisition". For the purpose of this Warrant, "Acquisition"
means any sale, license, or other disposition of all or substantially all of
the assets of the Company, or any reorganization, consolidation, or merger of
the Company where the holders of the Company's securities before the
transaction beneficially own less than 50% of the outstanding voting securities
of the surviving entity after the transaction.

          1.6.2 Assumption of Warrant. Upon the closing of any Acquisition, the
successor entity shall assume the obligations of this Warrant, and this Warrant
shall be exercisable for the same securities, cash, and property as would be
payable for the Shares issuable upon exercise of the unexercised portion of this
Warrant as if such Shares were outstanding on the record date for the
Acquisition and subsequent closing. The Initial Exercise Price and/or number of
Shares shall be adjusted accordingly.

ARTICLE 2. ADJUSTMENTS TO THE SHARES.

     2.1  Stock Dividends, Splits, Etc. If the Company declares or pays a
dividend on its common stock (or the Shares if the Shares are securities other
than common stock) payable in common stock, or other securities, subdivides the
outstanding common stock into a greater amount of common stock, or, if the
Shares are securities other than common stock, subdivides the Shares in a
transaction that increases the amount of common stock into which the Shares are
convertible, then upon exercise of this Warrant, for each Share acquired,
Holder shall receive, without cost to Holder, the total number and kind of
securities to which Holder would have been entitled had Holder owned the Shares
of record as of the date the dividend or subdivision occurred. If the
outstanding shares are combined or consolidated, by reclassification or
otherwise, into a lesser number of shares, the Initial Exercise Price shall be
proportionately increased.

     2.2  Reclassification, Exchange, Combinations or Substitution. Upon any
reclassification, exchange, substitution, or other event that results in a
change of the number and/or class of the securities issuable upon exercise or
conversion of this Warrant, Holder shall be entitled to receive, upon exercise
or conversion of this Warrant, the number and kind of securities and property
that Holder would have received for the Shares if this Warrant had been
exercised immediately before such reclassification, exchange, substitution, or
other event. Such an event shall include any automatic conversion of the
outstanding or issuable securities of the Company of the same class or series as
the Shares to common stock pursuant to the terms of the Company's Certificate of
Incorporation upon the closing of a registered public offering of the Company's
common stock. The Company or its successor shall promptly issue to Holder a new
Warrant for such new securities or other property. The new Warrant shall provide
for adjustments


                                       2


which shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Article 2 including, without limitation, adjustments to
the Initial Exercise Price and to the number of securities or property issuable
upon exercise of the new Warrant. The provisions of this Section 2.2 shall
similarly apply to successive reclassifications, exchanges, substitutions, or
other events.

          2.3  Adjustments for Diluting Issuances. The Warrant Price and the
number of Shares issuable upon exercise of this Warrant or, if the Shares are
Preferred Stock, the number of shares of common stock issuable upon conversion
of the Shares, shall be subject to adjustment, from time to time in the manner
set forth in the Company's Certificate of Incorporation*. The provisions set
forth for the Shares in the Company's Certificate of Incorporation relating to
the above in effect as of the Issue Date may not be amended, modified or
waived, without the prior written consent of Holder unless such amendment,
modification or waiver affects Holder in the same manner as they affect all
other shareholders of the same series of shares granted to the Holder.

*OR, IF NONE, THEN AS SET FORTH IN THAT CERTAIN ANTIDILUTION AGREEMENT OF
APPROXIMATE EVEN DATE HEREWITH BETWEEN THE COMPANY AND HOLDER

          2.4  No Impairment. The Company shall not, by amendment of its
Certificate of Incorporation or through a reorganization, transfer of assets,
consolidation, merger, dissolution, issue, or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any
of the terms to be observed or performed under this Warrant by the Company, but
shall at all times in good faith assist in carrying out of all the provisions
of this Article 2 and in taking all such action as  may be necessary or
appropriate to protect Holder's rights under this Article against impairment.

          2.5  Fractional Shares. No fractional Shares shall be issuable upon
exercise or conversion of the Warrant and the number of Shares to be issued
shall be rounded down to the nearest whole Share. If a fractional share
interest arises upon any exercise or conversion of the Warrant, the Company
shall eliminate such fractional share interest by paying Holder the amount
computed by multiplying the fractional interest by the fair market value of a
full Share.

          2.6  Certificate as to Adjustments. Upon each adjustment of the
Warrant Price, the Company shall promptly notify Holder in writing, and, at the
Company's expense, promptly compute such adjustment, and furnish Holder with a
certificate of its Chief Financial Officer setting forth such adjustment and
the facts upon which such adjustment is based. The Company shall, upon written
request, furnish Holder a certificate setting forth the Warrant Price in effect
upon the date thereof and the series of adjustments leading such Warrant Price.

ARTICLE 3.  REPRESENTATIONS AND COVENANTS OF THE COMPANY.

          3.1  Representations and Warranties. The Company represents and
warrants to the Holder as follows:

               (a)  The initial Warrant Price referenced on the first page of
this Warrant is not greater than (i) the price per share at which the Shares
were last issued in an arms-length transaction in which at least $500,000 of
the Shares were sold and (ii) the fair market value of the Shares as of the
date of this Warrant.

               (b)  All Shares which may be issued upon the exercise of the
purchase right represented by this Warrant, and all securities, if any,
issuable upon conversion of the Shares, shall, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable, and free of any liens
and encumbrances except for restrictions on transfer provided for herein or
under applicable federal and state securities laws.

                                       3

          (c)  The Capitalization Table previously provided to Holder remains
true and complete as of the Issue Date.

     3.2  Notice of Certain Events. If the Company proposes at any time (a) to
declare any dividend or distribution upon its common stock, whether in cash,
property, stock, or other securities and whether or not a regular cash dividend;
(b) to offer for subscription pro rata to the holders of any class or series of
its stock any additional shares of stock of any class or series or other rights;
(c) to effect any reclassification or recapitalization of common stock; (d) to
merge or consolidate with or into any other corporation, or sell, lease,
license, or convey all or substantially all of its assets, or to liquidate,
dissolve or wind up; or (e) offer holders of registration rights the opportunity
to participate in an underwritten public offering of the company's securities
for cash, then, in connection with each such event, the Company shall give
Holder (1) at least 10 days prior written notice of the date on which a record
will be taken for such dividend, distribution, or subscription rights (and
specifying the date on which the holders of common stock will be entitled
thereto) or for determining rights to vote, if any, in respect of the matters
referred to in (c) and (d) above; (2) in the case of the matters referred to in
(c) and (d) above at least 10 days prior written notice of the date when the
same will take place (and specifying the date on which the holders of common
stock will be entitled to exchange their common stock for securities or other
property deliverable upon the occurrence of such event); and (3) in the case of
the matter referred to in (e) above, the same notice as is given to the holders
of such registration rights.

     3.3  Registration Under Securities Act of 1933, as amended. The Company
agrees that the Shares or, if the Shares are convertible into common stock of
the Company, such common stock, shall be subject to the registration rights set
forth in the Company's [Investor Rights Agreement dated __________________] or
similar agreement*. The provisions set forth in the Company's Investors' Right
Agreement or similar agreement relating to the above in effect as of the Issue
Date may not be amended, modified or waived without the prior written consent of
Holder unless such amendment, modification or waiver affects Holder in the same
manner as they affect all other shareholders of the same series of shares
granted to the Holder.

*OR, IF NONE, THEN AS SET FORTH IN THAT CERTAIN REGISTRATION RIGHTS AGREEMENT
OF APPROXIMATE EVEN DATE HEREWITH BETWEEN THE COMPANY AND HOLDER

ARTICLE 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER. The Holder represents and
warrants to the Company as follows:

     4.1  Purchase for Own Account. Except for transfers to Holder's affiliates,
this Warrant and the securities to be acquired upon exercise of this Warrant by
the Holder will be acquired for investment for the Holder's account, not as a
nominee or agent, and not with a view to the public resale or distribution
within the meaning of the 1933 Act, and the Holder has no present intention of
selling, granting any participation in, or otherwise distributing the same. If
not an individual, the Holder also represents that the Holder has not been
formed for the specific purpose of acquiring this Warrant or the Shares.

     4.2  Disclosure of Information. The Holder has received or has had full
access to all the information it considers necessary or appropriate to make an
informed investment decision with respect to the acquisition of this Warrant and
its underlying securities. The Holder further has had an opportunity to ask
questions and receive answers from the Company regarding the terms and
conditions of the offering of this Warrant and its underlying securities and to
obtain additional information (to the extent the Company possessed such
information or could acquire it without unreasonable effort or expense)
necessary to verify any information furnished to the Holder or to which the
Holder has access.

     4.3  Investment Experience. The Holder understands that the purchase of
this Warrant and its underlying securities involves substantial risk. The
Holder: (i) has experience as an investor in securities of companies in the
development stage and acknowledges that the Holder is able to fend for itself,
can bear the economic risk of such Holder's investment in


                                       4

this Warrant and its underlying securities and has such knowledge and
experience in financial or business matters that the Holder is capable of
evaluating the merits and risks of its investment in this Warrant and its
underlying securities and/or (ii) has a preexisting personal or business
relationship with the Company and certain of its officers, directors or
controlling persons of a nature and duration that enables the Holder to be
aware of the character, business acumen and financial circumstances of such
persons.

          4.4 Accredited Investor Status. The Holder is an "accredited
investor" within the meaning of Regulation D promulgated under the 1933 Act.

ARTICLE 5. MISCELLANEOUS.

          5.1 Term: This Warrant is exercisable in whole or in part at any time
and from time to time on or before the Expiration Date.

          5.2 Legends. This Warrant and the Shares (and the securities
issuable, directly or indirectly, upon conversion of the Shares, if any) shall
be imprinted with a legend in substantially the following form:

          THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
          1933, AS AMENDED OR UNDER ANY APPLICABLE STATE LAWS, AND MAY NOT BE
          SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE
          REGISTRATION THEREOF UNDER SUCH ACT AND AN EXEMPTION UNDER APPLICABLE
          STATE LAW OR PURSUANT TO RULE 144 OR AN OPINION OF COUNSEL REASONABLY
          SATISFACTORY TO THE CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION
          IS NOT REQUIRED.

          5.3 Compliance with Securities Laws on Transfer. This Warrant and the
Shares issuable upon exercise of this Warrant (and the securities issuable,
directly or indirectly, upon conversion of the Shares, if any) may not be
transferred or assigned in whole or in part without compliance with applicable
federal and state securities laws by the transferor and the transferee
(including, without limitation, the delivery of investment representation
letters and legal opinions reasonably satisfactory to the Company, as
reasonably requested by the Company). The Company shall not require Holder to
provide an opinion of counsel if the transfer is to an affiliate of Holder or
if there is no material question as to the availability of current information
as referenced in Rule 144(c), Holder represents that it has complied with Rule
144(d) and (e) in reasonable detail, the selling broker represents that it has
complied with Rule 144(f), and the Company is provided with a copy of Holder's
notice of proposed sale.

          5.4 Transfer Procedure. Subject to the provisions of Section 5.3,
Holder may transfer all or part of this Warrant or the Shares issuable upon
exercise of this Warrant (or the securities issuable, directly or indirectly,
upon conversion of the Shares, if any) to Silicon Valley Bancshares, or The
Silicon Valley Bank Foundation, or to any affiliate of Holder at any time
without prior notice to Company; provided, however, if Holder transfers this
warrant to any other transferee, Holder will give the Company notice of the
portion of the Warrant being transferred with the name, address and taxpayer
identification number of the transferee and surrendering this Warrant to the
Company for reissuance to the transferee(s) (and Holder if applicable). The
Company may refuse to transfer this Warrant to any person who directly competes
with the Company unless the Company's stock is publicly traded.

          5.5 Notices. All notices and other communications from the Company to
the Holder, or vice versa, shall be deemed delivered and effective when given
personally or mailed by first-class registered or certified mail, postage
prepaid, at such address as may have been furnished to the Company or the
Holder, as the case may be, in writing by the Company or such holder from time
to time. All notices to the Holder shall be addressed as follows:


                                       5



               Silicon Valley Bank
               Attn: Treasury Department
               3003 Tasman Drive, HG 110
               Santa Clara, CA 95054

          5.6  Waiver. This Warrant and any term hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed by the party
against which enforcement of such change, waiver, discharge or termination is
sought.

          5.7  Attorney's Fees. In the event of any dispute between the parties
concerning the terms and provisions of this Warrant, the party prevailing in
such dispute shall be entitled to collect from the other party all costs
incurred in such dispute, including reasonable attorneys' fees.

          5.8  Automatic Conversion upon Expiration. In the event that, upon
the Expiration Date, the fair market value of one Share (or other security
issuable upon the exercise hereof) as determined in accordance with Section 1.3
above is greater than the Exercise Price in effect on such date, then this
Warrant shall automatically be deemed on and as of such date to be converted
pursuant to Section 1.2 above as to all Shares (or such other securities) for
which it shall not previously have been exercised or converted, and the Company
shall deliver a certificate representing the Shares (or such other securities)
issued upon such conversion to the Holder.

          5.9  Governing Law. This Warrant shall be governed by and construed
in accordance with the laws of the State of California, without giving effect
to its principles regarding conflicts of law.



                                        "COMPANY"
                                        Novatel Wireless, Inc.

                                        By:____________________________________

                                        Name:__________________________________
                                               (Print)
                                        Title: Chairman of the Board and
                                               Chief Executive Officer

                                        By:____________________________________

                                        Name:__________________________________
                                               (Print)
                                        Title: Chief Financial Officer and
                                               Secretary

                                        "HOLDER"
                                        Silicon Valley Bank

                                        By:____________________________________

                                        Name:__________________________________

                                        Title: ________________________________



                                       6



          Silicon Valley Bank
          Attn: Treasury Department
          3003 Tasman Drive, HG 110
          Santa Clara, CA 95054

     5.6  Waiver. This Warrant and any term hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed by the party
against which enforcement of such change, waiver, discharge or termination is
sought.

     5.7  Attorney's Fees. In the event of any dispute between the parties
concerning the terms and provisions of this Warrant, the party prevailing in
such dispute shall be entitled to collect from the other party all costs
incurred in such dispute, including reasonable attorneys' fees.

     5.8  Automatic Conversion upon Expiration. In the event that, upon the
Expiration Date, the fair market value of one Share (or other security issuable
upon the exercise hereof) as determined in accordance with Section 1.3 above is
greater than the Exercise Price in effect on such date, then this Warrant shall
automatically be deemed on and as of such date to be converted pursuant to
Section 1.2 above as to all Shares (or such other securities) for which it
shall not previously have been exercised or converted, and the Company shall
promptly deliver a certificate representing the Shares (or such other
securities) issued upon such conversion to the Holder.

     5.9  Governing Law. This Warrant shall be governed by and construed in
accordance with the laws of the State of California, without giving effect to
its principles regarding conflicts of law.

                                         "COMPANY"
                                         Novatel Wireless, Inc.

                                         By:  /s/ JOHN MAJOR
                                            ----------------------------------

                                         Name:  John Major
                                              --------------------------------
                                                (Print)

                                         Title:  Chairman of the Board and
                                                 Chief Executive Officer

                                         By:  /s/ MELVIN FLOWERS
                                            ----------------------------------

                                         Name:  Melvin Flowers
                                              --------------------------------
                                                (Print)

                                         Title:  Chief Financial Officer and
                                                 Secretary

                                         "HOLDER"
                                         Silicon Valley Bank

                                         By:
                                            ----------------------------------

                                         Name:
                                              --------------------------------

                                         Title:
                                               -------------------------------


                                       6



                    Silicon Valley Bank
                    Attn:  Treasury Department
                    3003 Tasman Drive, HG 110
                    Santa Clara, CA 95054

               5.6  Waiver.  This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought.

               5.7  Attorney's Fees.  In the event of any dispute between the
parties concerning the terms and provisions of this Warrant, the party
prevailing in such dispute shall be entitled to collect from the other party all
costs incurred in such dispute, including reasonable attorneys' fees.

               5.8  Automatic Conversion upon Expiration.  In the event that,
upon the Expiration Date, the fair market value of one Share (or other security
issuable upon the exercise hereof) as determined in accordance with Section 1.3
above is greater than the Exercise Price in effect on such date, then this
Warrant shall automatically be deemed on and as of such date to be converted
pursuant to Section 1.2 above as to all Shares (or such other securities) for
which it shall not previously have been exercised or converted, and the Company
shall promptly deliver a certificate representing the Shares (or such other
securities) issued upon such conversion to the Holder.

               5.9  Governing Law.  This Warrant shall be governed by and
construed in accordance with the laws of the State of California, without giving
effect to its principles regarding conflicts of law.


                                             "COMPANY"
                                             Novatel Wireless, Inc.


                                             By:  /s/ JOHN MAJOR
                                                -----------------------------

                                             Name:  John Major
                                                  ---------------------------
                                                   (Print)

                                             Title: Chairman of the Board and
                                                    Chief Executive Officer

                                             By:  /s/ MELVIN FLOWERS
                                                -----------------------------

                                             Name:  Melvin Flowers
                                                  ---------------------------
                                                   (Print)

                                             Title: Chief Financial officer
                                                    and Secretary


                                             "HOLDER"
                                             Silicon Valley Bank


                                             By:  /s/ MILAD I. HANNA
                                                -----------------------------

                                             Name:  Milad I. Hanna
                                                  ---------------------------

                                             Title:  Sr. Vice President
                                                   --------------------------


                                       6

EX-5.1

                                                                     EXHIBIT 5.1


                          [LATHAM & WATKINS LETTERHEAD]

                                ----------------

                                __________, 2002

Novatel Wireless, Inc.
9360 Towne Centre Drive, Suite 110
San Diego, California 92121

        Re:     Registration for resale of [__________] shares of common stock,
                par value $0.01 per share, of Novatel Wireless, Inc.

Ladies and Gentlemen:

        In connection with the registration for resale of _____ shares of
common stock, par value $.01 per share (the "Common Stock"), of Novatel
Wireless, Inc., a Delaware corporation (the "Company"), under the Securities Act
of 1933, as amended, on Form S-3 as filed with the Securities and Exchange
Commission on January 18, 2002 (the "Registration Statement"), you have
requested our opinion with respect to the matters set forth below. The shares
being registered for resale include: (i) 35,288,311 shares of Common Stock which
are issuable upon conversion of the Company's Series A Convertible Preferred
Stock (the "Series A Preferred Stock") issued in a December 2001 private
placement transaction (the "2001 Private Placement"); (ii) _____ shares of
Common Stock which are currently issuable upon exercise of certain outstanding
warrants issued by the Company in connection with the 2001 Private Placement and
other private placement transactions (collectively, the "Warrants"); and (iii)
5,000,000 shares of Common Stock issued to Sanmina-SCI Corporation (the "Sanmina
Shares"), pursuant to that certain Settlement Agreement and Mutual Release,
dated as of January 12, 2002.

        In our capacity as your counsel in connection with such registration, we
are familiar with the proceedings taken by the Company in connection with the
authorization and issuance of the Common Stock and, for the purposes of this
opinion, have assumed such proceedings will be timely completed in the manner
presently proposed and that the terms of each issuance will otherwise be in
compliance with law. In addition, we have made such legal and factual
examinations and inquiries, including an examination of originals or copies
certified or otherwise identified to our satisfaction of such documents,
corporate records and instruments, as we have deemed necessary or appropriate
for purposes of this opinion.

        In our examination, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals, and the
conformity to authentic original documents of all documents submitted to us as
copies. We have been furnished with, and with your consent have relied upon,
certificates of officers of the Company with respect to certain factual matters.
In addition, we have obtained and relied upon such certificates and assurances
from public officials as we have deemed necessary.

        We are opining herein as to the effect on the subject transaction only
of the General Corporation Law of the State of Delaware, and we express no
opinion with respect to the applicability thereto, or the effect thereon, of the
laws of any other jurisdiction or, in the case of Delaware, any other laws, or
as to any matters of municipal law or the laws of any local agencies within any
state.

        Subject to the foregoing, it is our opinion as of the date hereof that:

       1.  The Series A Preferred Stock have been duly authorized, and assuming
           the conversion of the Series A Preferred Stock in accordance with its
           terms, the shares of Common Stock issuable upon conversion of the
           Series A Preferred Stock, when issued, will be validly issued, fully
           paid and nonassessable;

       2.  The Warrants have been duly authorized, and assuming that the full
           consideration for each share issuable upon exercise of the Warrants
           is received by the Company in accordance with the terms of the
           Warrants, as applicable, the shares of Common Stock issuable upon
           exercise of the Warrants, when issued, will be validly issued, fully
           paid and nonassessable; and

       3.  The Sanmina Shares have been duly authorized and are validly issued,
           fully paid and nonassessable.



Novatel Wireless, Inc.
____________, 2002
Page 2

        We consent to your filing this opinion as an exhibit to the Registration
Statement and to the reference to our firm contained under the heading "Legal
Matters."

                                        Very truly yours,

EX-10.1

                                                                    EXHIBIT 10.1



SILICON VALLEY BANK

                           LOAN AND SECURITY AGREEMENT


BORROWER:      NOVATEL WIRELESS, INC.
ADDRESS:       9360 TOWNE CENTRE DRIVE, SUITE 110
               SAN DIEGO, CA  92121

DATE:          NOVEMBER 29, 2001


THIS LOAN AND SECURITY AGREEMENT is entered into on the above date between
SILICON VALLEY BANK, COMMERCIAL FINANCE DIVISION ("Silicon"), whose address is
3003 Tasman Drive, Santa Clara, California 95054 and the borrower(s) named above
(jointly and severally, the "Borrower"), whose chief executive office is located
at the above address ("Borrower's Address"). The Schedule to this Agreement (the
"Schedule") shall for all purposes be deemed to be a part of this Agreement, and
the same is an integral part of this Agreement. (Definitions of certain terms
used in this Agreement are set forth in Section 8 below.)

1.  LOANS.

  1.1 LOANS. Silicon will make loans to Borrower (the "Loans"), in amounts
determined by Silicon in its sole discretion, up to the amounts (the "Credit
Limit") shown on the Schedule, provided no Default or Event of Default has
occurred and is continuing, and subject to deduction of any Reserves for accrued
interest and such other Reserves as Silicon deems proper from time to time.

  1.2 INTEREST. All Loans and all other monetary Obligations shall bear interest
at the rate shown on the Schedule, except where expressly set forth to the
contrary in this Agreement. Interest shall be payable monthly, on the last day
of the month. Interest may, in Silicon's discretion, be charged to Borrower's
loan account, and the same shall thereafter bear interest at the same rate as
the other Loans. Silicon may, in its discretion, charge interest to Borrower's
Deposit Accounts maintained with Silicon. Regardless of the amount of
Obligations that may be outstanding from time to time, Borrower shall pay
Silicon minimum monthly interest during the term of this Agreement in the amount
set forth on the Schedule (the "Minimum Monthly Interest").

  1.3 OVERADVANCES. If at any time or for any reason the total of all
outstanding Loans and all other Obligations exceeds the Credit Limit (an
"Overadvance"), Borrower shall immediately pay the amount of the excess to
Silicon, without notice or demand. Without limiting Borrower's obligation to
repay to Silicon on demand the amount of any Overadvance, Borrower agrees to pay
Silicon interest on the outstanding amount of any Overadvance, on demand, at a
rate equal to the interest rate which would otherwise be applicable to the
Overadvance, plus an additional 2% per annum.

  1.4 FEES. Borrower shall pay Silicon the fee(s) shown on the Schedule, which
are in addition to all interest and other sums payable to Silicon and are not
refundable.

  1.5 LETTERS OF CREDIT. At the request of Borrower, Silicon may, in its sole
discretion, issue or arrange for the issuance of letters of credit for the
account of Borrower, in each case in form and substance satisfactory to Silicon
in its sole discretion (collectively, "Letters of Credit"). The aggregate face
amount of all outstanding Letters of Credit from time to time shall not exceed
the amount shown on the Schedule (the "Letter of Credit Sublimit"), and shall be
reserved against Loans which would otherwise be available hereunder, and in the
event at any time there are insufficient Loans available to Borrower for such
reserve, Borrower shall deposit and maintain with Silicon cash collateral in an
amount at all times equal to such deficiency, which shall be held as Collateral
for all purposes of this Agreement. Borrower shall pay all bank charges
(including charges of Silicon) for the issuance of Letters of Credit, together
with such additional fee as Silicon's letter of credit department shall charge
in connection with the issuance of the Letters of Credit. Any payment by Silicon
under or in connection with a Letter of Credit shall constitute a Loan hereunder
on the date such payment is made. Each Letter of Credit shall have an expiry
date no later than thirty days prior to the Maturity Date. Borrower hereby
agrees to indemnify, save, and hold Silicon harmless from any loss, cost,
expense, or liability, including payments made by Silicon,



                                      -1-


expenses, and reasonable attorneys' fees incurred by Silicon arising out of or
in connection with any Letters of Credit. Borrower agrees to be bound by the
regulations and interpretations of the issuer of any Letters of Credit
guarantied by Silicon and opened for Borrower's account or by Silicon's
interpretations of any Letter of Credit issued by Silicon for Borrower's
account, and Borrower understands and agrees that Silicon shall not be liable
for any error, negligence, or mistake, whether of omission or commission, in
following Borrower's instructions or those contained in the Letters of Credit or
any modifications, amendments, or supplements thereto. Borrower understands that
Letters of Credit may require Silicon to indemnify the issuing bank for certain
costs or liabilities arising out of claims by Borrower against such issuing
bank. Borrower hereby agrees to indemnify and hold Silicon harmless with respect
to any loss, cost, expense, or liability incurred by Silicon under any Letter of
Credit as a result of Silicon's indemnification of any such issuing bank. The
provisions of this Loan Agreement, as it pertains to Letters of Credit, and any
other present or future documents or agreements between Borrower and Silicon
relating to Letters of Credit are cumulative.

2.  SECURITY INTEREST.

  2.1 SECURITY INTEREST. To secure the payment and performance of all of the
Obligations when due, Borrower hereby grants to Silicon a security interest in
all of Borrower's interest in the following, whether now owned or hereafter
acquired, and wherever located: All Inventory, Equipment, Receivables, and
General Intangibles, including, without limitation, all of Borrower's Deposit
Accounts, and all money, and all property now or at any time in the future in
Silicon's possession (including claims and credit balances), and all proceeds
(including proceeds of any insurance policies, proceeds of proceeds and claims
against third parties), all products and all books and records related to any of
the foregoing (all of the foregoing, together with all other property in which
Silicon may now or in the future be granted a lien or security interest, is
referred to herein, collectively, as the "Collateral").

3.  REPRESENTATIONS, WARRANTIES AND COVENANTS OF BORROWER.

  In order to induce Silicon to enter into this Agreement and to make Loans,
Borrower represents and warrants to Silicon as follows, and Borrower covenants
that the following representations will continue to be true, and that Borrower
will at all times comply with all of the following covenants:

  3.1 CORPORATE EXISTENCE AND AUTHORITY. Borrower, if a corporation, is and will
continue to be, duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation. Borrower is and will continue to
be qualified and licensed to do business in all jurisdictions in which any
failure to do so would have a material adverse effect on Borrower. The
execution, delivery and performance by Borrower of this Agreement, and all other
documents contemplated hereby (i) have been duly and validly authorized, (ii)
are enforceable against Borrower in accordance with their terms (except as
enforcement may be limited by equitable principles and by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to creditors'
rights generally), and (iii) do not violate Borrower's articles or certificate
of incorporation, or Borrower's by-laws, or any law or any material agreement or
instrument which is binding upon Borrower or its property, and (iv) do not
constitute grounds for acceleration of any material indebtedness or obligation
under any material agreement or instrument which is binding upon Borrower or its
property.

  3.2 NAME; TRADE NAMES AND STYLES. The name of Borrower set forth in the
heading to this Agreement is its correct name. Listed on the Schedule are all
prior names of Borrower and all of Borrower's present and prior trade names.
Borrower shall give Silicon 30 days' prior written notice before changing its
name or doing business under any other name. Borrower has complied, and will in
the future comply, with all laws relating to the conduct of business under a
fictitious business name.

  3.3 PLACE OF BUSINESS; LOCATION OF COLLATERAL. The address set forth in the
heading to this Agreement is Borrower's chief executive office. In addition,
Borrower has places of business and Collateral is located only at the locations
set forth on the Schedule. Borrower will give Silicon at least 30 days prior
written notice before opening any additional place of business, changing its
chief executive office, or moving any of the Collateral to a location other than
Borrower's Address or one of the locations set forth on the Schedule.*

  * NOTWITHSTANDING THE FOREGOING, SO LONG AS THIS AGREEMENT IS IN EFFECT,
BORROWER SHALL NOT TRANSFER ANY ASSETS OR COLLATERAL TO ANY PARENT, SUBSIDIARY
OR AFFILIATE OF BORROWER NOR SHALL BORROWER TRANSFER ANY ASSETS OR COLLATERAL TO
ANY LOCATION LOCATED OUTSIDE OF THE UNITED STATES REGARDLESS OF WHETHER OR NOT
SUCH LOCATION IS SET FORTH ON THE SCHEDULE; PROVIDED, HOWEVER, THAT BORROWER MAY
MAKE PAYMENTS OF EXPENSES ON BEHALF OF NOVATEL WIRELESS TECHNOLOGIES, LTD. FOR
EXPENSES INCURRED BY SUCH SUBSIDIARY IN THE ORDINARY COURSE OF BUSINESS PROVIDED
SUCH EXPENSES DO NOT EXCEED $11,000,000 IN ANY FISCAL YEAR. NOTWITHSTANDING THE
FOREGOING, HOWEVER, IF BORROWER FORMS A NEW WHOLLY-OWNED SUBSIDIARY THAT IS
INCORPORATED AND LOCATED IN THE UNITED STATES TO WHICH BORROWER DESIRES TO
TRANSFER A PORTION OF ITS GENERAL INTANGIBLES, BORROWER WILL BE PERMITTED TO DO
SO PROVIDED THAT (i) BORROWER OBTAINS SILICON'S PRIOR WRITTEN CONSENT AS
PROVIDED FOR HEREIN, (ii) SUCH SUBSIDIARY IS MADE A CO-BORROWER UNDER THIS
AGREEMENT AND (iii) SUCH SUBSIDIARY GRANTS SILICON A FIRST PRIORITY PERFECTED
SECURITY INTEREST IN THE COLLATERAL OF SUCH SUBSIDIARY.



                                      -2-


  3.4 TITLE TO COLLATERAL; PERMITTED LIENS. Borrower is now, and will at all
times in the future be, the sole owner of all the Collateral, except for items
of Equipment which are leased by Borrower. The Collateral now is and will remain
free and clear of any and all liens, charges, security interests, encumbrances
and adverse claims, except for Permitted Liens. Silicon now has, and will
continue to have, a first-priority perfected and enforceable security interest
in all of the Collateral, subject only to the Permitted Liens, and Borrower will
at all times defend Silicon and the Collateral against all claims of others.
None of the Collateral now is or will be affixed to any real property in such a
manner, or with such intent, as to become a fixture. Borrower is not and will
not become a lessee under any real property lease pursuant to which the lessor
may obtain any rights in any of the Collateral and no such lease now prohibits,
restrains, impairs or will prohibit, restrain or impair Borrower's right to
remove any Collateral from the leased premises. Whenever any Collateral is
located upon premises in which any third party has an interest (whether as
owner, mortgagee, beneficiary under a deed of trust, lien or otherwise),
Borrower shall, whenever requested by Silicon, use its best efforts to cause
such third party to execute and deliver to Silicon, in form acceptable to
Silicon, such waivers and subordinations as Silicon shall specify, so as to
ensure that Silicon's rights in the Collateral are, and will continue to be,
superior to the rights of any such third party. Borrower will keep in full force
and effect, and will comply with all the terms of, any lease of real property
where any of the Collateral now or in the future may be located.

  3.5 MAINTENANCE OF COLLATERAL. Borrower will maintain the Collateral in good
working condition, and Borrower will not use the Collateral for any unlawful
purpose. Borrower will immediately advise Silicon in writing of any material
loss or damage to the Collateral.

  3.6 BOOKS AND RECORDS. Borrower has maintained and will maintain at Borrower's
Address complete and accurate books and records, comprising an accounting system
in accordance with generally accepted accounting principles.

  3.7 FINANCIAL CONDITION, STATEMENTS AND REPORTS. All financial statements now
or in the future delivered to Silicon have been, and will be, prepared in
conformity with generally accepted accounting principles and now and in the
future will completely and accurately reflect the financial condition of
Borrower, at the times and for the periods therein stated. Between the last date
covered by any such statement provided to Silicon and the date hereof, there has
been no material adverse change in the financial condition or business of
Borrower. Borrower is now and will continue to be solvent.

  3.8 TAX RETURNS AND PAYMENTS; PENSION CONTRIBUTIONS. Borrower has timely
filed, and will timely file, all tax returns and reports required by foreign,
federal, state and local law, and Borrower has timely paid, and will timely pay,
all foreign, federal, state and local taxes, assessments, deposits and
contributions now or in the future owed by Borrower. Borrower may, however,
defer payment of any contested taxes, provided that Borrower (i) in good faith
contests Borrower's obligation to pay the taxes by appropriate proceedings
promptly and diligently instituted and conducted, (ii) notifies Silicon in
writing of the commencement of, and any material development in, the
proceedings, and (iii) posts bonds or takes any other steps required to keep the
contested taxes from becoming a lien upon any of the Collateral. Borrower is
unaware of any claims or adjustments proposed for any of Borrower's prior tax
years which could result in additional taxes becoming due and payable by
Borrower. Borrower has paid, and shall continue to pay all amounts necessary to
fund all present and future pension, profit sharing and deferred compensation
plans in accordance with their terms, and Borrower has not and will not withdraw
from participation in, permit partial or complete termination of, or permit the
occurrence of any other event with respect to, any such plan which could result
in any liability of Borrower, including any liability to the Pension Benefit
Guaranty Corporation or its successors or any other governmental agency.
Borrower shall, at all times, utilize the services of an outside payroll service
providing for the automatic deposit of all payroll taxes payable by Borrower.

  3.9 COMPLIANCE WITH LAW. Borrower has complied, and will comply, in all
material respects, with all provisions of all foreign, federal, state and local
laws and regulations relating to Borrower, including, but not limited to, those
relating to Borrower's ownership of real or personal property, the conduct and
licensing of Borrower's business, and all environmental matters.

  3.10 LITIGATION. Except as disclosed in the Schedule, there is no claim, suit,
litigation, proceeding or investigation pending or (to best of Borrower's
knowledge) threatened by or against or affecting Borrower in any court or before
any governmental agency (or any basis therefor known to Borrower) which may
result, either separately or in the aggregate, in any material adverse change in
the financial condition or business of Borrower, or in any material impairment
in the ability of Borrower to carry on its business in substantially the same
manner as it is now being conducted. Borrower will promptly inform Silicon in
writing of any claim, proceeding, litigation or investigation in the future
threatened or instituted by or against Borrower involving any single claim of
$50,000 or more, or involving $100,000 or more in the aggregate.

  3.11 USE OF PROCEEDS. All proceeds of all Loans shall be used solely for
lawful business purposes. Borrower is not purchasing or carrying any "margin
stock" (as defined in Regulation U of the Board of Governors of the Federal
Reserve System) and no part of the proceeds of any Loan will be used to purchase
or carry any "margin stock" or to



                                      -3-


extend credit to others for the purpose of purchasing or carrying any "margin
stock."

4.  RECEIVABLES.

  4.1 REPRESENTATIONS RELATING TO RECEIVABLES. Borrower represents and warrants
to Silicon as follows: Each Receivable with respect to which Loans are requested
by Borrower shall, on the date each Loan is requested and made, (i) represent an
undisputed bona fide existing unconditional obligation of the Account Debtor
created by the sale, delivery, and acceptance of goods or the rendition of
services in the ordinary course of Borrower's business, and (ii) meet the
Minimum Eligibility Requirements set forth in Section 8 below.

  4.2 REPRESENTATIONS RELATING TO DOCUMENTS AND LEGAL COMPLIANCE. Borrower
represents and warrants to Silicon as follows: All statements made and all
unpaid balances appearing in all invoices, instruments and other documents
evidencing the Receivables are and shall be true and correct and all such
invoices, instruments and other documents and all of Borrower's books and
records are and shall be genuine and in all respects what they purport to be,
and all signatories and endorsers have the capacity to contract. All sales and
other transactions underlying or giving rise to each Receivable shall fully
comply with all applicable laws and governmental rules and regulations. All
signatures and endorsements on all documents, instruments, and agreements
relating to all Receivables are and shall be genuine, and all such documents,
instruments and agreements are and shall be legally enforceable in accordance
with their terms.

  4.3 SCHEDULES AND DOCUMENTS RELATING TO RECEIVABLES. Borrower shall deliver to
Silicon transaction reports and loan requests, schedules and assignments of all
Receivables, and schedules of collections, all on Silicon's standard forms;
provided, however, that Borrower's failure to execute and deliver the same shall
not affect or limit Silicon's security interest and other rights in all of
Borrower's Receivables, nor shall Silicon's failure to advance or lend against a
specific Receivable affect or limit Silicon's security interest and other rights
therein. Loan requests received after 12:00 Noon will not be considered by
Silicon until the next Business Day. Together with each such schedule and
assignment, or later if requested by Silicon, Borrower shall furnish Silicon
with copies (or, at Silicon's request, originals) of all contracts, orders,
invoices, and other similar documents, and all original shipping instructions,
delivery receipts, bills of lading, and other evidence of delivery, for any
goods the sale or disposition of which gave rise to such Receivables, and
Borrower warrants the genuineness of all of the foregoing. Borrower shall also
furnish to Silicon an aged accounts receivable trial balance in such form and at
such intervals as Silicon shall request. In addition, Borrower shall deliver to
Silicon the originals of all instruments, chattel paper, security agreements,
guarantees and other documents and property evidencing or securing any
Receivables, immediately upon receipt thereof and in the same form as received,
with all necessary indorsements, all of which shall be with recourse. *Borrower
shall also provide Silicon with copies of all credit memos within two days after
the date issued.

  *UPON SILICON'S REQUEST,

  4.4 COLLECTION OF RECEIVABLES. Borrower shall have the right to collect all
Receivables, unless and until a Default or an Event of Default has occurred.
Borrower shall hold all payments on, and proceeds of, Receivables in trust for
Silicon, and Borrower shall immediately deliver all such payments and proceeds
to Silicon in their original form, duly endorsed in blank, to be applied to the
Obligations in such order as Silicon shall determine. Silicon may, in its
discretion, require that all proceeds of Collateral be deposited by Borrower
into a lockbox account, or such other "blocked account" as Silicon may specify,
pursuant to a blocked account agreement in such form as Silicon may specify.
Silicon or its designee may, at any time, notify Account Debtors that the
Receivables have been assigned to Silicon.

  4.5. REMITTANCE OF PROCEEDS. All proceeds arising from the disposition of any
Collateral shall be delivered, in kind, by Borrower to Silicon in the original
form in which received by Borrower not later than the following Business Day
after receipt by Borrower, to be applied to the Obligations in such order as
Silicon shall determine; provided that, if no Default or Event of Default has
occurred, Borrower shall not be obligated to remit to Silicon the proceeds of
the sale of worn out or obsolete equipment disposed of by Borrower in good faith
in an arm's length transaction for an aggregate purchase price of $25,000 or
less (for all such transactions in any fiscal year). Borrower agrees that it
will not commingle proceeds of Collateral with any of Borrower's other funds or
property, but will hold such proceeds separate and apart from such other funds
and property and in an express trust for Silicon. Nothing in this Section limits
the restrictions on disposition of Collateral set forth elsewhere in this
Agreement.

  4.6 DISPUTES. Borrower shall notify Silicon promptly of all disputes or claims
relating to Receivables. Borrower shall not forgive (completely or partially),
compromise or settle any Receivable for less than payment in full, or agree to
do any of the foregoing, except that Borrower may do so, provided that: (i)
Borrower does so in good faith, in a commercially reasonable manner, in the
ordinary course of business, and in arm's length transactions, which are
reported to Silicon on the regular reports provided to Silicon; (ii) no Default
or Event of Default has occurred and is continuing; and (iii) taking into
account all such discounts settlements and forgiveness, the total outstanding
Loans will not exceed the Credit Limit. Silicon may, at any time after the
occurrence of an Event of Default, settle or adjust disputes or claims directly
with Account Debtors



                                      -4-


for amounts and upon terms which Silicon considers advisable in its reasonable
credit judgment and, in all cases, Silicon shall credit Borrower's Loan account
with only the net amounts received by Silicon in payment of any Receivables.

  4.7 RETURNS. Provided no Event of Default has occurred and is continuing, if
any Account Debtor returns any Inventory to Borrower in the ordinary course of
its business, Borrower shall promptly determine the reason for such return and
promptly issue a credit memorandum to the Account Debtor in the appropriate
amount (sending a copy to Silicon). In the event any attempted return occurs
after the occurrence of any Event of Default, Borrower shall (i) hold the
returned Inventory in trust for Silicon, (ii) segregate all returned Inventory
from all of Borrower's other property, (iii) conspicuously label the returned
Inventory as Silicon's property, and (iv) immediately notify Silicon of the
return of any Inventory, specifying the reason for such return, the location and
condition of the returned Inventory, and on Silicon's request deliver such
returned Inventory to Silicon.

  4.8 VERIFICATION. Silicon may, from time to time, verify directly with the
respective Account Debtors the validity, amount and other matters relating to
the Receivables, by means of mail, telephone or otherwise, either in the name of
Borrower or Silicon or such other name as Silicon may choose.

  4.9 NO LIABILITY. Silicon shall not under any circumstances be responsible or
liable for any shortage or discrepancy in, damage to, or loss or destruction of,
any goods, the sale or other disposition of which gives rise to a Receivable, or
for any error, act, omission, or delay of any kind occurring in the settlement,
failure to settle, collection or failure to collect any Receivable, or for
settling any Receivable in good faith for less than the full amount thereof, nor
shall Silicon be deemed to be responsible for any of Borrower's obligations
under any contract or agreement giving rise to a Receivable. Nothing herein
shall, however, relieve Silicon from liability for its own gross negligence or
willful misconduct.

5.  ADDITIONAL DUTIES OF BORROWER.

  5.1 FINANCIAL AND OTHER COVENANTS. Borrower shall at all times comply with the
financial and other covenants set forth in the Schedule.

  5.2 INSURANCE. Borrower shall, at all times insure all of the tangible
personal property Collateral and carry such other business insurance, with
insurers reasonably acceptable to Silicon, in such form and amounts as Silicon
may reasonably require, and Borrower shall provide evidence of such insurance to
Silicon, so that Silicon is satisfied that such insurance is, at all times, in
full force and effect. All such insurance policies shall name Silicon as an
additional insured and loss payee, and shall contain a lenders loss payee
endorsement in form reasonably acceptable to Silicon. Upon receipt of the
proceeds of any such insurance, Silicon shall apply such proceeds in reduction
of the Obligations as Silicon shall determine in its sole discretion, except
that, provided no Default or Event of Default has occurred and is continuing,
Silicon shall release to Borrower insurance proceeds with respect to Equipment
totaling less than $100,000, which shall be utilized by Borrower for the
replacement of the Equipment with respect to which the insurance proceeds were
paid. Silicon may require reasonable assurance that the insurance proceeds so
released will be so used. If Borrower fails to provide or pay for any insurance,
Silicon may, but is not obligated to, obtain the same at Borrower's expense.
Borrower shall promptly deliver to Silicon copies of all reports made to
insurance companies.

  5.3 REPORTS. Borrower, at its expense, shall provide Silicon with the written
reports set forth in the Schedule, and such other written reports with respect
to Borrower (including budgets, sales projections, operating plans and other
financial documentation), as Silicon shall from time to time reasonably specify.

  5.4 ACCESS TO COLLATERAL, BOOKS AND RECORDS. At reasonable times, and on one
Business Day's notice, Silicon, or its agents, shall have the right to inspect
the Collateral, and the right to audit and copy Borrower's books and records.
Silicon shall take reasonable steps to keep confidential all information
obtained in any such inspection or audit, but Silicon shall have the right to
disclose any such information to its auditors, regulatory agencies, and
attorneys, and pursuant to any subpoena or other legal process. The foregoing
inspections and audits shall be at Borrower's expense and the charge therefor
shall be $700 per person per day (or such higher amount as shall represent
Silicon's then current standard charge for the same), plus reasonable out of
pocket expenses. Borrower will not enter into any agreement with any accounting
firm, service bureau or third party to store Borrower's books or records at any
location other than Borrower's Address, without first obtaining Silicon's
written consent, which may be conditioned upon such accounting firm, service
bureau or other third party agreeing to give Silicon the same rights with
respect to access to books and records and related rights as Silicon has under
this Loan Agreement. Borrower waives the benefit of any accountant-client
privilege or other evidentiary privilege precluding or limiting the disclosure,
divulgence or delivery of any of its books and records (except that Borrower
does not waive any attorney-client privilege).

  5.5 NEGATIVE COVENANTS. Except as may be permitted in the Schedule, Borrower
shall not, without Silicon's prior written consent*, do any of the following:
(i) merge or consolidate with another corporation or entity; (ii) acquire any
assets, except in the ordinary course of business; (iii) enter into any other
transaction outside the ordinary course of business; (iv) sell or transfer any
Collateral, except for the sale of finished Inventory in the



                                      -5-


ordinary course of Borrower's business, and except for the sale of obsolete or
unneeded Equipment in the ordinary course of business; (v) store any Inventory
or other Collateral with any warehouseman or other third party; (vi) sell any
Inventory on a sale-or-return, guaranteed sale, consignment, or other contingent
basis; (vii) make any loans of any money or other assets; (viii) incur any
debts, outside the ordinary course of business, which would have a material,
adverse effect on Borrower or on the prospect of repayment of the Obligations;
(ix) guarantee or otherwise become liable with respect to the obligations of
another party or entity; (x) pay or declare any dividends on Borrower's stock
(except for dividends payable solely in stock of Borrower); (xi) redeem, retire,
purchase or otherwise acquire, directly or indirectly, any of Borrower's stock;
(xii) make any change in Borrower's capital structure which would have a
material adverse effect on Borrower or on the prospect of repayment of the
Obligations; or (xiii) pay total compensation, including salaries, fees,
bonuses, commissions, and all other payments, whether directly or indirectly, in
money or otherwise, to Borrower's executives, officers and directors (or any
relative thereof) in an amount in excess of the amount set forth on the
Schedule; or (xiv) dissolve or elect to dissolve. Transactions permitted by the
foregoing provisions of this Section are only permitted if no Default or Event
of Default would occur as a result of such transaction.

  * WHICH CONSENT, OR DENIAL THEREOF, WILL BE DETERMINED BY SILICON IN ITS
GOOD-FAITH BUSINESS JUDGMENT

  5.6 LITIGATION COOPERATION. Should any third-party suit or proceeding be
instituted by or against Silicon with respect to any Collateral or in any manner
relating to Borrower, Borrower shall, without expense to Silicon, make available
Borrower and its officers, employees and agents and Borrower's books and
records, to the extent that Silicon may deem them reasonably necessary in order
to prosecute or defend any such suit or proceeding.

  5.7 FURTHER ASSURANCES. Borrower agrees, at its expense, on request by
Silicon, to execute all documents and take all actions, as Silicon, may deem
reasonably necessary or useful in order to perfect and maintain Silicon's
perfected security interest in the Collateral, and in order to fully consummate
the transactions contemplated by this Agreement.

6.   TERM.

  6.1 MATURITY DATE. This Agreement shall continue in effect until the maturity
date set forth on the Schedule (the "Maturity Date"), subject to Section 6.3
below.

  6.2 EARLY TERMINATION. This Agreement may be terminated prior to the Maturity
Date as follows: (i) by Borrower, effective three Business Days after written
notice of termination is given to Silicon; or (ii) by Silicon at any time after
the occurrence of an Event of Default, without notice, effective immediately. If
this Agreement is terminated by Borrower or by Silicon under this Section 6.2,
Borrower shall pay to Silicon a termination fee in an amount equal to* two
percent (2.0%) of the Maximum Credit Limit, provided that no termination fee
shall be charged if the credit facility hereunder is replaced with a new
facility from another division of Silicon Valley Bank. The termination fee shall
be due and payable on the effective date of termination and thereafter shall
bear interest at a rate equal to the highest rate applicable to any of the
Obligations.

  * ONE PERCENT (1.0%)

  6.3 PAYMENT OF OBLIGATIONS. On the Maturity Date or on any earlier effective
date of termination, Borrower shall pay and perform in full all Obligations,
whether evidenced by installment notes or otherwise, and whether or not all or
any part of such Obligations are otherwise then due and payable. Without
limiting the generality of the foregoing, if on the Maturity Date, or on any
earlier effective date of termination, there are any outstanding Letters of
Credit issued by Silicon or issued by another institution based upon an
application, guarantee, indemnity or similar agreement on the part of Silicon,
then on such date Borrower shall provide to Silicon cash collateral in an amount
equal to the face amount of all such Letters of Credit plus all interest, fees
and cost due or to become due in connection therewith, to secure all of the
Obligations relating to said Letters of Credit, pursuant to Silicon's then
standard form cash pledge agreement. Notwithstanding any termination of this
Agreement, all of Silicon's security interests in all of the Collateral and all
of the terms and provisions of this Agreement shall continue in full force and
effect until all Obligations have been paid and performed in full; provided
that, without limiting the fact that Loans are subject to the discretion of
Silicon, Silicon may, in its sole discretion, refuse to make any further Loans
after termination. No termination shall in any way affect or impair any right or
remedy of Silicon, nor shall any such termination relieve Borrower of any
Obligation to Silicon, until all of the Obligations have been paid and performed
in full. Upon payment and performance in full of all the Obligations and
termination of this Agreement, Silicon shall promptly deliver to Borrower
termination statements, requests for reconveyances and such other documents as
may be required to fully terminate Silicon's security interests.

7.  EVENTS OF DEFAULT AND REMEDIES.

  7.1 EVENTS OF DEFAULT. The occurrence of any of the following events shall
constitute an "Event of Default" under this Agreement, and Borrower shall give
Silicon immediate written notice thereof: (a) Any warranty, representation,
statement, report or certificate made or delivered to Silicon by Borrower or any
of Borrower's officers, employees or agents, now or in the future, shall be
untrue or misleading in a material respect; or (b) Borrower shall fail to pay
when due any Loan or any



                                      -6-


interest thereon or any other monetary Obligation; or (c) the total Loans and
other Obligations outstanding at any time shall exceed the Credit Limit; or (d)
Borrower shall fail to comply with any of the financial covenants set forth in
the Schedule or shall fail to perform any other non-monetary Obligation which by
its nature cannot be cured; or (e) Borrower shall fail to perform any other
non-monetary Obligation, which failure is not cured within 5 Business Days after
the date due; or (f) any levy, assessment, attachment, seizure, lien or
encumbrance (other than a Permitted Lien) is made on all or any part of the
Collateral which is not cured within 10* after the occurrence of the same;
or (g) any default or event of default occurs under any obligation secured by a
Permitted Lien, which is not cured within any applicable cure period or waived
in writing by the holder of the Permitted Lien; or (h) Borrower breaches any
material contract or obligation, which **has or may reasonably be expected to
have a material adverse effect on Borrower's business or financial condition; or
(i) Dissolution, termination of existence, insolvency or business failure of
Borrower; or appointment of a receiver, trustee or custodian, for all or any
part of the property of, assignment for the benefit of creditors by, or the
commencement of any proceeding by Borrower under any reorganization, bankruptcy,
insolvency, arrangement, readjustment of debt, dissolution or liquidation law or
statute of any jurisdiction, now or in the future in effect; or (j) the
commencement of any proceeding against Borrower or any guarantor of any of the
Obligations under any reorganization, bankruptcy, insolvency, arrangement,
readjustment of debt, dissolution or liquidation law or statute of any
jurisdiction, now or in the future in effect, which is not cured by the
dismissal thereof within 30 days after the date commenced; or (k) revocation or
termination of, or limitation or denial of liability upon, any guaranty of the
Obligations or any attempt to do any of the foregoing, or commencement of
proceedings by any guarantor of any of the Obligations under any bankruptcy or
insolvency law; or (l) revocation or termination of, or limitation or denial of
liability upon, any pledge of any certificate of deposit, securities or other
property or asset of any kind pledged by any third party to secure any or all of
the Obligations, or any attempt to do any of the foregoing, or commencement of
proceedings by or against any such third party under any bankruptcy or
insolvency law; or (m) Borrower makes any payment on account of any indebtedness
or obligation which has been subordinated to the Obligations other than as
permitted in the applicable subordination agreement, or if any Person who has
subordinated such indebtedness or obligations terminates or in any way limits
his subordination agreement; or (n) there shall be a change in the record or
beneficial ownership of an aggregate of more than*** of the outstanding
shares of stock of Borrower, in one or more transactions, compared to the
ownership of outstanding shares of stock of Borrower in effect on the date
hereof, without the prior written consent of Silicon; or (o) Borrower shall
generally not pay its debts as they become due, or Borrower shall conceal,
remove or transfer any part of its property, with intent to hinder, delay or
defraud its creditors, or make or suffer any transfer of any of its property
which may be fraudulent under any bankruptcy, fraudulent conveyance or similar
law; or (p) there shall be a material adverse change in Borrower's business or
financial condition; or (q) Silicon, acting in good faith and in a commercially
reasonable manner, deems itself insecure because of the occurrence of an event
prior to the effective date hereof of which Silicon had no knowledge on the
effective date or because of the occurrence of an event on or subsequent to the
effective date. Silicon may cease making any Loans hereunder during any of the
above cure periods, and thereafter if an Event of Default has occurred.

  *   BUSINESS DAYS

  **  BREACH

  *** 50%

  7.2 REMEDIES. Upon the occurrence of any Event of Default, and at any time
thereafter, Silicon, at its option, and without notice or demand of any kind
(all of which are hereby expressly waived by Borrower), may do any one or more
of the following: (a) Cease making Loans or otherwise extending credit to
Borrower under this Agreement or any other document or agreement; (b) Accelerate
and declare all or any part of the Obligations to be immediately due, payable,
and performable, notwithstanding any deferred or installment payments allowed by
any instrument evidencing or relating to any Obligation; (c) Take possession of
any or all of the Collateral wherever it may be found, and for that purpose
Borrower hereby authorizes Silicon without judicial process to enter onto any of
Borrower's premises without interference to search for, take possession of,
keep, store, or remove any of the Collateral, and remain on the premises or
cause a custodian to remain on the premises in exclusive control thereof,
without charge for so long as Silicon deems it reasonably necessary in order to
complete the enforcement of its rights under this Agreement or any other
agreement; provided, however, that should Silicon seek to take possession of any
of the Collateral by Court process, Borrower hereby irrevocably waives: (i) any
bond and any surety or security relating thereto required by any statute, court
rule or otherwise as an incident to such possession; (ii) any demand for
possession prior to the commencement of any suit or action to recover possession
thereof; and (iii) any requirement that Silicon retain possession of, and not
dispose of, any such Collateral until after trial or final judgment; (d) Require
Borrower to assemble any or all of the Collateral and make it available to
Silicon at places designated by Silicon which are reasonably convenient to
Silicon and Borrower, and to remove the Collateral to such locations as Silicon
may deem advisable; (e) Complete the processing, manufacturing or repair of any



                                      -7-


Collateral prior to a disposition thereof and, for such purpose and for the
purpose of removal, Silicon shall have the right to use Borrower's premises,
vehicles, hoists, lifts, cranes, equipment and all other property without
charge; (f) Sell, lease or otherwise dispose of any of the Collateral, in its
condition at the time Silicon obtains possession of it or after further
manufacturing, processing or repair, at one or more public and/or private sales,
in lots or in bulk, for cash, exchange or other property, or on credit, and to
adjourn any such sale from time to time without notice other than oral
announcement at the time scheduled for sale. Silicon shall have the right to
conduct such disposition on Borrower's premises without charge, for such time or
times as Silicon deems reasonable, or on Silicon's premises, or elsewhere and
the Collateral need not be located at the place of disposition. Silicon may
directly or through any affiliated company purchase or lease any Collateral at
any such public disposition, and if permissible under applicable law, at any
private disposition. Any sale or other disposition of Collateral shall not
relieve Borrower of any liability Borrower may have if any Collateral is
defective as to title or physical condition or otherwise at the time of sale;
(g) Demand payment of, and collect any Receivables and General Intangibles
comprising Collateral and, in connection therewith, Borrower irrevocably
authorizes Silicon to endorse or sign Borrower's name on all collections,
receipts, instruments and other documents, to take possession of and open mail
addressed to Borrower and remove therefrom payments made with respect to any
item of the Collateral or proceeds thereof, and, in Silicon's sole discretion,
to grant extensions of time to pay, compromise claims and settle Receivables and
the like for less than face value; (h) Offset against any sums in any of
Borrower's general, special or other Deposit Accounts with Silicon; and (i)
Demand and receive possession of any of Borrower's federal and state income tax
returns and the books and records utilized in the preparation thereof or
referring thereto. All reasonable attorneys' fees, expenses, costs, liabilities
and obligations incurred by Silicon with respect to the foregoing shall be added
to and become part of the Obligations, shall be due on demand, and shall bear
interest at a rate equal to the highest interest rate applicable to any of the
Obligations. Without limiting any of Silicon's rights and remedies, from and
after the occurrence of any Event of Default, the interest rate applicable to
the Obligations shall be increased by an additional four percent per annum.

  7.3 STANDARDS FOR DETERMINING COMMERCIAL REASONABLENESS. Borrower and Silicon
agree that a sale or other disposition (collectively, "sale") of any Collateral
which complies with the following standards will conclusively be deemed to be
commercially reasonable: (i) Notice of the sale is given to Borrower at least
seven days prior to the sale, and, in the case of a public sale, notice of the
sale is published at least seven days before the sale in a newspaper of general
circulation in the county where the sale is to be conducted; (ii) Notice of the
sale describes the collateral in general, non-specific terms; (iii) The sale is
conducted at a place designated by Silicon, with or without the Collateral being
present; (iv) The sale commences at any time between 8:00 a.m. and 6:00 p.m; (v)
Payment of the purchase price in cash or by cashier's check or wire transfer is
required; (vi) With respect to any sale of any of the Collateral, Silicon may
(but is not obligated to) direct any prospective purchaser to ascertain directly
from Borrower any and all information concerning the same. Silicon shall be free
to employ other methods of noticing and selling the Collateral, in its
discretion, if they are commercially reasonable.

  7.4 POWER OF ATTORNEY. Upon the occurrence of any Event of Default, without
limiting Silicon's other rights and remedies, Borrower grants to Silicon an
irrevocable power of attorney coupled with an interest, authorizing and
permitting Silicon (acting through any of its employees, attorneys or agents) at
any time, at its option, but without obligation, with or without notice to
Borrower, and at Borrower's expense, to do any or all of the following, in
Borrower's name or otherwise, but Silicon agrees to exercise the following
powers in a commercially reasonable manner: (a) Execute on behalf of Borrower
any documents that Silicon may, in its sole discretion, deem advisable in order
to perfect and maintain Silicon's security interest in the Collateral, or in
order to exercise a right of Borrower or Silicon, or in order to fully
consummate all the transactions contemplated under this Agreement, and all other
present and future agreements; (b) Execute on behalf of Borrower any document
exercising, transferring or assigning any option to purchase, sell or otherwise
dispose of or to lease (as lessor or lessee) any real or personal property which
is part of Silicon's Collateral or in which Silicon has an interest; (c) Execute
on behalf of Borrower, any invoices relating to any Receivable, any draft
against any Account Debtor and any notice to any Account Debtor, any proof of
claim in bankruptcy, any Notice of Lien, claim of mechanic's, materialman's or
other lien, or assignment or satisfaction of mechanic's, materialman's or other
lien; (d) Take control in any manner of any cash or non-cash items of payment or
proceeds of Collateral; endorse the name of Borrower upon any instruments, or
documents, evidence of payment or Collateral that may come into Silicon's
possession; (e) Endorse all checks and other forms of remittances received by
Silicon; (f) Pay, contest or settle any lien, charge, encumbrance, security
interest and adverse claim in or to any of the Collateral, or any judgment based
thereon, or otherwise take any action to terminate or discharge the same; (g)
Grant extensions of time to pay, compromise claims and settle Receivables and
General Intangibles for less than face value and execute all releases and other
documents in connection therewith; (h) Pay any sums required on account of
Borrower's taxes or to secure the release of any liens therefor, or both; (i)
Settle and adjust, and give releases of, any insurance claim that relates to any
of the Collateral and obtain payment therefor; (j) Instruct any



                                      -8-


third party having custody or control of any books or records belonging to, or
relating to, Borrower to give Silicon the same rights of access and other rights
with respect thereto as Silicon has under this Agreement; and (k) Take any
action or pay any sum required of Borrower pursuant to this Agreement and any
other present or future agreements. Any and all reasonable sums paid and any and
all reasonable costs, expenses, liabilities, obligations and attorneys' fees
incurred by Silicon with respect to the foregoing shall be added to and become
part of the Obligations, shall be payable on demand, and shall bear interest at
a rate equal to the highest interest rate applicable to any of the Obligations.
In no event shall Silicon's rights under the foregoing power of attorney or any
of Silicon's other rights under this Agreement be deemed to indicate that
Silicon is in control of the business, management or properties of Borrower.

  7.5 APPLICATION OF PROCEEDS. All proceeds realized as the result of any sale
of the Collateral shall be applied by Silicon first to the reasonable costs,
expenses, liabilities, obligations and attorneys' fees incurred by Silicon in
the exercise of its rights under this Agreement, second to the interest due upon
any of the Obligations, and third to the principal of the Obligations, in such
order as Silicon shall determine in its sole discretion. Any surplus shall be
paid to Borrower or other persons legally entitled thereto; Borrower shall
remain liable to Silicon for any deficiency. If, Silicon, in its sole
discretion, directly or indirectly enters into a deferred payment or other
credit transaction with any purchaser at any sale of Collateral, Silicon shall
have the option, exercisable at any time, in its sole discretion, of either
reducing the Obligations by the principal amount of purchase price or deferring
the reduction of the Obligations until the actual receipt by Silicon of the cash
therefor.

  7.6 REMEDIES CUMULATIVE. In addition to the rights and remedies set forth in
this Agreement, Silicon shall have all the other rights and remedies accorded a
secured party under the California Uniform Commercial Code and under all other
applicable laws, and under any other instrument or agreement now or in the
future entered into between Silicon and Borrower, and all of such rights and
remedies are cumulative and none is exclusive. Exercise or partial exercise by
Silicon of one or more of its rights or remedies shall not be deemed an
election, nor bar Silicon from subsequent exercise or partial exercise of any
other rights or remedies. The failure or delay of Silicon to exercise any rights
or remedies shall not operate as a waiver thereof, but all rights and remedies
shall continue in full force and effect until all of the Obligations have been
fully paid and performed.

8.  DEFINITIONS.  As used in this Agreement, the following terms have the
following meanings:

  "Account Debtor" means the obligor on a Receivable.

  "Affiliate" means, with respect to any Person, a relative, partner,
shareholder, director, officer, or employee of such Person, or any parent or
subsidiary of such Person, or any Person controlling, controlled by or under
common control with such Person.

  "Business Day" means a day on which Silicon is open for business.

  "Code" means the Uniform Commercial Code as adopted and in effect in the State
of California from time to time.

  "Collateral" has the meaning set forth in Section 2.1 above.

  "Default" means any event which with notice or passage of time or both, would
constitute an Event of Default.

  "Deposit Account" has the meaning set forth in Section 9102(a) of the Code.*

  * "DISTRIBUTOR" MEANS AN ACCOUNT DEBTOR THAT, IN SILICON'S SOLE DISCRETION,
ACQUIRES GOODS FROM THE BORROWER FOR PURPOSES OF DISTRIBUTING OR RESELLING THE
GOODS TO A RETAIL SELLER OR OTHER THIRD PARTY.

  "Eligible Inventory" [NOT APPLICABLE].

  "Eligible Receivables" means Receivables arising in the ordinary course of
Borrower's business from the sale of goods or rendition of services, which
Silicon, in its sole judgment, shall deem eligible for borrowing, based on such
considerations as Silicon may from time to time deem appropriate. Without
limiting the fact that the determination of which Receivables are eligible for
borrowing is a matter of Silicon's discretion, the following (the "Minimum
Eligibility Requirements") are the minimum requirements for a Receivable to be
an Eligible Receivable: (i) the Receivable must not be outstanding for more than
90 days from its invoice date*, (ii) the Receivable must not represent progress
billings, or be due under a fulfillment or requirements contract with the
Account Debtor, (iii) the Receivable must not be subject to any contingencies
(including Receivables arising from sales on consignment, guaranteed sale or
other terms pursuant to which payment by the Account Debtor may be conditional),
(iv) the Receivable must not be owing from an Account Debtor with whom Borrower
has any dispute (whether or not relating to the particular Receivable), (v) the
Receivable must not be owing from an Affiliate of Borrower, (vi) the Receivable
must not be owing from an Account Debtor which is subject to any insolvency or
bankruptcy proceeding, or whose financial condition is not acceptable to
Silicon, or which, fails or goes out of a material portion of its business,
(vii) the Receivable must not be owing from the United States or any department,
agency or instrumentality thereof (unless there has been compliance, to
Silicon's satisfaction, with the United States Assignment of Claims Act), (viii)
the Receivable must not be owing from an Account Debtor located outside the
United States or Canada (unless pre-approved by Silicon in its discretion in
writing, or backed



                                      -9-


by a letter of credit satisfactory to Silicon, or FCIA insured satisfactory to
Silicon), (ix) the Receivable must not be owing from an Account Debtor to whom
Borrower is or may be liable for goods purchased from such Account Debtor or
otherwise. Receivables owing from one Account Debtor will not be deemed Eligible
Receivables to the extent they exceed 25% of the total Receivables
outstanding**. In addition, if more than 50% of the Receivables owing from an
Account Debtor are outstanding more than 90 days from their invoice date*
(without regard to unapplied credits) or are otherwise not eligible Receivables,
then all Receivables owing from that Account Debtor will be deemed ineligible
for borrowing. Silicon may, from time to time, in its discretion, revise the
Minimum Eligibility Requirements, upon written notice to Borrower.

  * (45 DAYS FROM THE INVOICE DATE WITH RESPECT TO RECEIVABLES FOR WHICH A
DISTRIBUTOR IS THE ACCOUNT DEBTOR)

  **; PROVIDED, HOWEVER, RECEIVABLES OWING FROM A DISTRIBUTOR WILL NOT BE DEEMED
ELIGIBLE RECEIVABLES TO THE EXTENT THEY EXCEED THE LOWER OF 25% OF THE TOTAL
RECEIVABLES OUTSTANDING OR $500,000

  "Equipment" means all of Borrower's present and hereafter acquired machinery,
molds, machine tools, motors, furniture, equipment, furnishings, fixtures, trade
fixtures, motor vehicles, tools, parts, dyes, jigs, goods and other tangible
personal property (other than Inventory) of every kind and description used in
Borrower's operations or owned by Borrower and any interest in any of the
foregoing, and all attachments, accessories, accessions, replacements,
substitutions, additions or improvements to any of the foregoing, wherever
located.

  "Event of Default" means any of the events set forth in Section 7.1 of this
Agreement.

  "General Intangibles" means all general intangibles of Borrower, whether now
owned or hereafter created or acquired by Borrower, including, without
limitation, all choses in action, causes of action, corporate or other business
records, Deposit Accounts, inventions, designs, drawings, blueprints, patents,
patent applications, trademarks and the goodwill of the business symbolized
thereby, names, trade names, trade secrets, goodwill, copyrights, registrations,
licenses, franchises, customer lists, security and other deposits, rights in all
litigation presently or hereafter pending for any cause or claim (whether in
contract, tort or otherwise), and all judgments now or hereafter arising
therefrom, all claims of Borrower against Silicon, rights to purchase or sell
real or personal property, rights as a licensor or licensee of any kind,
royalties, telephone numbers, proprietary information, purchase orders, and all
insurance policies and claims (including without limitation life insurance, key
man insurance, credit insurance, liability insurance, property insurance and
other insurance), tax refunds and claims, computer programs, discs, tapes and
tape files, claims under guaranties, security interests or other security held
by or granted to Borrower, all rights to indemnification and all other
intangible property of every kind and nature (other than Receivables).

  "Inventory" means all of Borrower's now owned and hereafter acquired goods,
merchandise or other personal property, wherever located, to be furnished under
any contract of service or held for sale or lease (including without limitation
all raw materials, work in process, finished goods and goods in transit), and
all materials and supplies of every kind, nature and description which are or
might be used or consumed in Borrower's business or used in connection with the
manufacture, packing, shipping, advertising, selling or finishing of such goods,
merchandise or other personal property, and all warehouse receipts, documents of
title and other documents representing any of the foregoing.

  "Obligations" means all present and future Loans, advances, debts,
liabilities, obligations, guaranties, covenants, duties and indebtedness at any
time owing by Borrower to Silicon, whether evidenced by this Agreement or any
note or other instrument or document, whether arising from an extension of
credit, opening of a letter of credit, banker's acceptance, loan, guaranty,
indemnification or otherwise, whether direct or indirect (including, without
limitation, those acquired by assignment and any participation by Silicon in
Borrower's debts owing to others), absolute or contingent, due or to become due,
including, without limitation, all interest, charges, expenses, fees, attorney's
fees, expert witness fees, audit fees, letter of credit fees, collateral
monitoring fees, closing fees, facility fees, termination fees, minimum interest
charges and any other sums chargeable to Borrower under this Agreement or under
any other present or future instrument or agreement between Borrower and
Silicon.

  "Permitted Liens" means the following: (i) purchase money security interests
in specific items of Equipment; (ii) leases of specific items of Equipment;
(iii) liens for taxes not yet payable; (iv) additional security interests and
liens consented to in writing by Silicon, which consent shall not be
unreasonably withheld; (v) security interests being terminated substantially
concurrently with this Agreement; (vi) liens of materialmen, mechanics,
warehousemen, carriers, or other similar liens arising in the ordinary course of
business and securing obligations which are not delinquent; (vii) liens incurred
in connection with the extension, renewal or refinancing of the indebtedness
secured by liens of the type described above in clauses (i) or (ii) above,
provided that any extension, renewal or replacement lien is limited to the
property encumbered by the existing lien and the principal amount of the
indebtedness being extended, renewed or refinanced does not increase; (viii)
Liens in favor of customs and revenue authorities which secure payment of
customs duties in connection with the importation of goods. Silicon will have
the right to require, as a condition to its consent



                                      -10-


under subparagraph (iv) above, that the holder of the additional security
interest or lien sign an intercreditor agreement on Silicon's then standard
form, acknowledge that the security interest is subordinate to the security
interest in favor of Silicon, and agree not to take any action to enforce its
subordinate security interest so long as any Obligations remain outstanding, and
that Borrower agree that any uncured default in any obligation secured by the
subordinate security interest shall also constitute an Event of Default under
this Agreement.

  "Person" means any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation,
government, or any agency or political division thereof, or any other entity.

  "Receivables" means all of Borrower's now owned and hereafter acquired
accounts (whether or not earned by performance), letters of credit, contract
rights, chattel paper, instruments, securities, securities accounts, investment
property, documents and all other forms of obligations at any time owing to
Borrower, all guaranties and other security therefor, all merchandise returned
to or repossessed by Borrower, and all rights of stoppage in transit and all
other rights or remedies of an unpaid vendor, lienor or secured party.

  "Reserves" means, as of any date of determination, such amounts as Silicon may
from time to time establish and revise in good faith reducing the amount of
Loans, Letters of Credit and other financial accommodations which would
otherwise be available to Borrower under the lending formula(s) provided in the
Schedule: (a) to reflect events, conditions, contingencies or risks which, as
determined by Silicon in good faith, do or may affect (i) the Collateral or any
other property which is security for the Obligations or its value (including
without limitation any increase in delinquencies of Receivables), (ii) the
assets, business or prospects of Borrower or any Guarantor, or (iii) the
security interests and other rights of Silicon in the Collateral (including the
enforceability, perfection and priority thereof); or (b) to reflect Silicon's
good faith belief that any collateral report or financial information furnished
by or on behalf of Borrower or any Guarantor to Silicon is or may have been
incomplete, inaccurate or misleading in any material respect; or (c) in respect
of any state of facts which Silicon determines in good faith constitutes an
Event of Default or may, with notice or passage of time or both, constitute an
Event of Default.

  Other Terms. All accounting terms used in this Agreement, unless otherwise
indicated, shall have the meanings given to such terms in accordance with
generally accepted accounting principles, consistently applied. All other terms
contained in this Agreement, unless otherwise indicated, shall have the meanings
provided by the Code, to the extent such terms are defined therein.

9.  GENERAL PROVISIONS.

  9.1 INTEREST COMPUTATION. In computing interest on the Obligations, all
checks, wire transfers and other items of payment received by Silicon (including
proceeds of Receivables and payment of the Obligations in full) shall be deemed
applied by Silicon on account of the Obligations three Business Days after
receipt by Silicon of immediately available funds, and, for purposes of the
foregoing, any such funds received after 12:00 Noon on any day shall be deemed
received on the next Business Day. Silicon shall not, however, be required to
credit Borrower's account for the amount of any item of payment which is
unsatisfactory to Silicon in its sole discretion, and Silicon may charge
Borrower's loan account for the amount of any item of payment which is returned
to Silicon unpaid.

  9.2 APPLICATION OF PAYMENTS. All payments with respect to the Obligations may
be applied, and in Silicon's sole discretion reversed and re-applied, to the
Obligations, in such order and manner as Silicon shall determine in its sole
discretion.

  9.3 CHARGES TO ACCOUNTS. Silicon may, in its discretion, require that Borrower
pay monetary Obligations in cash to Silicon, or charge them to Borrower's Loan
account, in which event they will bear interest at the same rate applicable to
the Loans. Silicon may also, in its discretion, charge any monetary Obligations
to Borrower's Deposit Accounts maintained with Silicon.

  9.4 MONTHLY ACCOUNTINGS. Silicon shall provide Borrower monthly with an
account of advances, charges, expenses and payments made pursuant to this
Agreement. Such account shall be deemed correct, accurate and binding on
Borrower and an account stated (except for reverses and reapplications of
payments made and corrections of errors discovered by Silicon), unless Borrower
notifies Silicon in writing to the contrary within thirty days after each
account is rendered, describing the nature of any alleged errors or admissions.

  9.5 NOTICES. All notices to be given under this Agreement shall be in writing
and shall be given either personally or by reputable private delivery service or
by regular first-class mail, or certified mail return receipt requested,
addressed to Silicon or Borrower at the addresses shown in the heading to this
Agreement, or at any other address designated in writing by one party to the
other party. Notices to Silicon shall be directed to the Commercial Finance
Division, to the attention of the Division Manager or the Division Credit
Manager. All notices shall be deemed to have been given upon delivery in the
case of notices personally delivered, or at the expiration of one Business Day
following delivery to the private delivery service, or two Business Days
following the deposit thereof in the United States mail, with postage prepaid.



                                      -11-


  9.6 SEVERABILITY. Should any provision of this Agreement be held by any court
of competent jurisdiction to be void or unenforceable, such defect shall not
affect the remainder of this Agreement, which shall continue in full force and
effect.

  9.7 INTEGRATION. This Agreement and such other written agreements, documents
and instruments as may be executed in connection herewith are the final, entire
and complete agreement between Borrower and Silicon and supersede all prior and
contemporaneous negotiations and oral representations and agreements, all of
which are merged and integrated in this Agreement. There are no oral
understandings, representations or agreements between the parties which are not
set forth in this Agreement or in other written agreements signed by the parties
in connection herewith.

  9.8 WAIVERS. The failure of Silicon at any time or times to require Borrower
to strictly comply with any of the provisions of this Agreement or any other
present or future agreement between Borrower and Silicon shall not waive or
diminish any right of Silicon later to demand and receive strict compliance
therewith. Any waiver of any default shall not waive or affect any other
default, whether prior or subsequent, and whether or not similar. None of the
provisions of this Agreement or any other agreement now or in the future
executed by Borrower and delivered to Silicon shall be deemed to have been
waived by any act or knowledge of Silicon or its agents or employees, but only
by a specific written waiver signed by an authorized officer of Silicon and
delivered to Borrower. Borrower waives demand, protest, notice of protest and
notice of default or dishonor, notice of payment and nonpayment, release,
compromise, settlement, extension or renewal of any commercial paper,
instrument, account, General Intangible, document or guaranty at any time held
by Silicon on which Borrower is or may in any way be liable, and notice of any
action taken by Silicon, unless expressly required by this Agreement.

  9.9 NO LIABILITY FOR ORDINARY NEGLIGENCE. Neither Silicon, nor any of its
directors, officers, employees, agents, attorneys or any other Person affiliated
with or representing Silicon shall be liable for any claims, demands, losses or
damages, of any kind whatsoever, made, claimed, incurred or suffered by Borrower
or any other party through the ordinary negligence of Silicon, or any of its
directors, officers, employees, agents, attorneys or any other Person affiliated
with or representing Silicon, but nothing herein shall relieve Silicon from
liability for its own gross negligence or willful misconduct.

  9.10 AMENDMENT. The terms and provisions of this Agreement may not be waived
or amended, except in a writing executed by Borrower and a duly authorized
officer of Silicon.

  9.11 TIME OF ESSENCE. Time is of the essence in the performance by Borrower of
each and every obligation under this Agreement.

  9.12 ATTORNEYS FEES AND COSTS. Borrower shall reimburse Silicon for all
reasonable attorneys' fees and all filing, recording, search, title insurance,
appraisal, audit, and other reasonable costs incurred by Silicon, pursuant to,
or in connection with, or relating to this Agreement (whether or not a lawsuit
is filed), including, but not limited to, any reasonable attorneys' fees and
costs Silicon incurs in order to do the following: prepare and negotiate this
Agreement and the documents relating to this Agreement; obtain legal advice in
connection with this Agreement or Borrower; enforce, or seek to enforce, any of
its rights; prosecute actions against, or defend actions by, Account Debtors;
commence, intervene in, or defend any action or proceeding; initiate any
complaint to be relieved of the automatic stay in bankruptcy; file or prosecute
any probate claim, bankruptcy claim, third-party claim, or other claim; examine,
audit, copy, and inspect any of the Collateral or any of Borrower's books and
records; protect, obtain possession of, lease, dispose of, or otherwise enforce
Silicon's security interest in, the Collateral; and otherwise represent Silicon
in any litigation relating to Borrower. In satisfying Borrower's obligation
hereunder to reimburse Silicon for attorneys fees, Borrower may, for
convenience, issue checks directly to Silicon's attorneys, Levy, Small & Lallas,
but Borrower acknowledges and agrees that Levy, Small & Lallas is representing
only Silicon and not Borrower in connection with this Agreement. If either
Silicon or Borrower files any lawsuit against the other predicated on a breach
of this Agreement, the prevailing party in such action shall be entitled to
recover its reasonable costs and attorneys' fees, including (but not limited to)
reasonable attorneys' fees and costs incurred in the enforcement of, execution
upon or defense of any order, decree, award or judgment. All attorneys' fees and
costs to which Silicon may be entitled pursuant to this Paragraph shall
immediately become part of Borrower's Obligations, shall be due on demand, and
shall bear interest at a rate equal to the highest interest rate applicable to
any of the Obligations.

  9.13 BENEFIT OF AGREEMENT. The provisions of this Agreement shall be binding
upon and inure to the benefit of the respective successors, assigns, heirs,
beneficiaries and representatives of Borrower and Silicon; provided, however,
that Borrower may not assign or transfer any of its rights under this Agreement
without the prior written consent of Silicon, and any prohibited assignment
shall be void. No consent by Silicon to any assignment shall release Borrower
from its liability for the Obligations.

  9.14 JOINT AND SEVERAL LIABILITY. If Borrower consists of more than one
Person, their liability shall be joint and several, and the compromise of any
claim with, or the release of, any Borrower shall not constitute a compromise
with, or a release of, any other Borrower.



                                      -12-



  9.15 LIMITATION OF ACTIONS. Any claim or cause of action by Borrower against
Silicon, its directors, officers, employees, agents, accountants or attorneys,
based upon, arising from, or relating to this Loan Agreement, or any other
present or future document or agreement, or any other transaction contemplated
hereby or thereby or relating hereto or thereto, or any other matter, cause or
thing whatsoever, occurred, done, omitted or suffered to be done by Silicon, its
directors, officers, employees, agents, accountants or attorneys, shall be
barred unless asserted by Borrower by the commencement of an action or
proceeding in a court of competent jurisdiction by the filing of a complaint
within* after the first act, occurrence or omission upon which such claim or
cause of action, or any part thereof, is based, and the service of a summons and
complaint on an officer of Silicon, or on any other person authorized to accept
service on behalf of Silicon, within thirty (30) days thereafter. Borrower
agrees that such** period is a reasonable and sufficient time for Borrower to
investigate and act upon any such claim or cause of action. The** period
provided herein shall not be waived, tolled, or extended except by the written
consent of Silicon in its sole discretion. This provision shall survive any
termination of this Loan Agreement or any other present or future agreement.

  * TWO YEARS

  ** TWO-YEAR

  9.16 PARAGRAPH HEADINGS; CONSTRUCTION. Paragraph headings are only used in
this Agreement for convenience. Borrower and Silicon acknowledge that the
headings may not describe completely the subject matter of the applicable
paragraph, and the headings shall not be used in any manner to construe, limit,
define or interpret any term or provision of this Agreement. The term
"including", whenever used in this Agreement, shall mean "including (but not
limited to)". This Agreement has been fully reviewed and negotiated between the
parties and no uncertainty or ambiguity in any term or provision of this
Agreement shall be construed strictly against Silicon or Borrower under any rule
of construction or otherwise.

  9.17 GOVERNING LAW; JURISDICTION; VENUE. This Agreement and all acts and
transactions hereunder and all rights and obligations of Silicon and Borrower
shall be governed by the laws of the State of California. As a material part of
the consideration to Silicon to enter into this Agreement, Borrower (i) agrees
that all actions and proceedings relating directly or indirectly to this
Agreement shall, at Silicon's option, be litigated in courts located within
California, and that the exclusive venue therefor shall be Santa Clara County;
(ii) consents to the jurisdiction and venue of any such court and consents to
service of process in any such action or proceeding by personal delivery or any
other method permitted by law; and (iii) waives any and all rights Borrower may
have to object to the jurisdiction of any such court, or to transfer or change
the venue of any such action or proceeding.

  9.18 MUTUAL WAIVER OF JURY TRIAL. BORROWER AND SILICON EACH HEREBY WAIVE THE
RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF,
OR IN ANY WAY RELATING TO, THIS AGREEMENT OR ANY OTHER PRESENT OR FUTURE
INSTRUMENT OR AGREEMENT BETWEEN SILICON AND BORROWER, OR ANY CONDUCT, ACTS OR
OMISSIONS OF SILICON OR BORROWER OR ANY OF THEIR DIRECTORS, OFFICERS, EMPLOYEES,
AGENTS, ATTORNEYS OR ANY OTHER PERSONS AFFILIATED WITH SILICON OR BORROWER, IN
ALL OF THE FOREGOING CASES, WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE.

  BORROWER:

        NOVATEL WIRELESS, INC.


        BY /s/ JOHN MAJOR
          ---------------------------------------
               PRESIDENT OR VICE PRESIDENT

        BY /s/ MELVIN FLOWERS
          ---------------------------------------
               SECRETARY OR ASS'T SECRETARY

  SILICON:

        SILICON VALLEY BANK


        BY /s/ MILAD I. HANNA
          ---------------------------------------
        TITLE Sr. Vice President
             ------------------------------------



                                      -13-


SILICON VALLEY BANK

                                   SCHEDULE TO

                           LOAN AND SECURITY AGREEMENT


BORROWER:      NOVATEL WIRELESS, INC.
ADDRESS:       9360 TOWNE CENTRE DRIVE, SUITE 110
               SAN DIEGO, CA  92121

DATE:          NOVEMBER 29, 2001

This Schedule forms an integral part of the Loan and Security Agreement between
Silicon Valley Bank and the above-borrower of even date.

================================================================================

1.  CREDIT LIMIT
    (Section 1.1):            An amount equal to the sum of (a) the applicable
                              clause of A, B, C or D set forth below plus (b)
                              the Standby Letter of Credit (as defined below)

                              A. An amount not to exceed the lesser of: (i)
                              $2,000,000 at any one time outstanding (the "$2
                              Million Cap"); or (ii) 80% of the amount of
                              Borrower's Eligible Receivables (as defined in
                              Section 8 above).

                              B. Notwithstanding the foregoing, at such time as
                              Borrower has received at least $7,500,000 in cash
                              consideration for the issuance, after the date
                              hereof, of equity securities of Borrower or
                              Subordinated Debt (as defined herein), then an
                              amount not to exceed the lesser of: (i) $3,500,000
                              at any one time outstanding (the "$3.5 Million
                              Cap"); or (ii) 80% of the amount of Borrower's
                              Eligible Receivables (as defined in Section 8
                              above).

                              C. Notwithstanding the foregoing, at such time as
                              Borrower has received at least $10,000,000 in cash
                              consideration for the issuance, after the date
                              hereof, of equity securities of Borrower or
                              Subordinated Debt (as defined herein), then an
                              amount not to exceed the lesser of: (i) $5,000,000
                              at any one time outstanding (the "$5 Million
                              Cap"); or (ii) 80% of the amount of Borrower's
                              Eligible Receivables (as defined in Section 8
                              above).

                              D. Notwithstanding the foregoing, at such time as
                              Borrower has received at least $20,000,000 in cash
                              consideration for the issuance, after the date
                              hereof, of equity securities of Borrower or
                              Subordinated Debt (as defined herein), then an
                              amount not to exceed the lesser of: (i)
                              $10,000,000 at any one time outstanding (the
                              "Maximum Credit



                                      -1-


                              Limit"); or (ii) 80% of the amount of Borrower's
                              Eligible Receivables (as defined in Section 8
                              above).

                              Borrower shall provide Silicon with evidence
                              satisfactory to Silicon that Borrower has received
                              said amounts of cash consideration prior to any
                              increase from any of the aforementioned Caps
                              taking effect.

    LETTER OF CREDIT
    SUBLIMIT (Section 1.5):   $1,000,000.

    STANDBY LETTER OF
    CREDIT:                   $50,000. Silicon previously issued for the account
                              of Borrower a Standby Letter of Credit in the
                              amount of $50,000 (the "Standby Letter of
                              Credit"), which Standby Letter of Credit is
                              secured by a certificate of deposit pledged to
                              Silicon on Silicon's standard form documentation.

================================================================================

2.  INTEREST.

        INTEREST RATE
        (Section 1.2):        A rate equal to the "Prime Rate" in effect from
                              time to time, plus 2% per annum, provided that the
                              interest rate in effect each month shall not be
                              less than 7% per annum. Interest shall be
                              calculated on the basis of a 360-day year for the
                              actual number of days elapsed. "Prime Rate" means
                              the rate announced from time to time by Silicon as
                              its "prime rate;" it is a base rate upon which
                              other rates charged by Silicon are based, and it
                              is not necessarily the best rate available at
                              Silicon. The interest rate applicable to the
                              Obligations shall change on each date there is a
                              change in the Prime Rate.

        MINIMUM MONTHLY
        INTEREST
        (Section 1.2):        $10,000 per month; provided, however, such amount
                              shall be $5,000 per month while the $2 Million
                              Cap, $3.5 Million Cap or $5 Million Cap is in
                              effect.

================================================================================

3.  FEES (Section 1.4):

        Loan Fee:             $100,000, payable concurrently herewith, which fee
                              Silicon acknowledges has been paid by Borrower and
                              received by Silicon.

        Collateral
        Monitoring Fee:       $1,000, per month, payable in arrears (prorated
                              for any partial month at the beginning and at
                              termination of this Agreement).



                                      -2-


================================================================================

4.  MATURITY DATE
    (Section 6.1):            One year from the date of this Agreement.

================================================================================

5.  FINANCIAL COVENANTS
    (Section 5.1):            Borrower shall comply with each of the following
                              covenant(s). Compliance shall be determined as of
                              the end of each month, except as otherwise
                              specifically provided below:

        MINIMUM
        QUICK RATIO:          Borrower shall maintain a ratio of cash on hand
                              plus Receivables to current liabilities of not
                              less than 0.5 to 1.

        MINIMUM TANGIBLE
        NET WORTH:            Borrower shall maintain a Tangible Net Worth of
                              not less than $12,000,000 plus 25% of the
                              consideration received by Borrower after the date
                              hereof for the issuance of equity securities of
                              Borrower and Subordinated Debt (as defined
                              herein).

        DEFINITIONS.          For purposes of the foregoing financial covenants,
                              the following term shall have the following
                              meaning:

                              "Current assets", "current liabilities" and
                              "liabilities" shall have the meaning ascribed
                              thereto by generally accepted accounting
                              principles.

                              "Tangible Net Worth" shall mean the excess of
                              total assets over total liabilities, determined in
                              accordance with generally accepted accounting
                              principles, with the following adjustments:

                                    (A) there shall be excluded from assets: (i)
                                    notes, accounts receivable and other
                                    obligations owing to Borrower from its
                                    officers or other Affiliates, and (ii) all
                                    assets which would be classified as
                                    intangible assets under generally accepted
                                    accounting principles, including without
                                    limitation goodwill, licenses, patents,
                                    trademarks, trade names, copyrights,
                                    capitalized software and organizational
                                    costs, licenses and franchises

                                    (B) there shall be excluded from
                                    liabilities: all indebtedness which is
                                    subordinated to the Obligations under a
                                    subordination agreement in form specified by
                                    Silicon or by language in the instrument
                                    evidencing the indebtedness which is
                                    acceptable to Silicon in its discretion
                                    ("Subordinated Debt").

================================================================================

6.  REPORTING.
    (Section 5.3):



                                      -3-


                         Borrower shall provide Silicon with the following:

                         1.   Monthly Receivable agings, aged by invoice date,
                              within fifteen days after the end of each month.

                         2.   Monthly accounts payable agings, aged by invoice
                              date, and outstanding or held check registers, if
                              any, within fifteen days after the end of each
                              month.

                         3.   Monthly reconciliations of Receivable agings (aged
                              by invoice date), transaction reports, and general
                              ledger, within fifteen days after the end of each
                              month.

                         4.   Monthly perpetual inventory reports for the
                              Inventory valued on a first-in, first-out basis at
                              the lower of cost or market (in accordance with
                              generally accepted accounting principles) or such
                              other inventory reports as are reasonably
                              requested by Silicon, all within fifteen days
                              after the end of each month.

                         5.   Monthly unaudited financial statements, as soon as
                              available, and in any event within thirty days
                              after the end of each month.

                         6.   Monthly Compliance Certificates, within thirty
                              days after the end of each month, in such form as
                              Silicon shall reasonably specify, signed by the
                              Chief Financial Officer of Borrower, certifying
                              that as of the end of such month Borrower was in
                              full compliance with all of the terms and
                              conditions of this Agreement, and setting forth
                              calculations showing compliance with the financial
                              covenants set forth in this Agreement and such
                              other information as Silicon shall reasonably
                              request, including, without limitation, a
                              statement that at the end of such month there were
                              no held checks.

                         7.   Quarterly unaudited financial statements, as soon
                              as available, and in any event within forty-five
                              days after the end of each fiscal quarter of
                              Borrower.

                         8.   Annual operating budgets (including income
                              statements, balance sheets and cash flow
                              statements, by month) for the upcoming fiscal year
                              of Borrower within thirty days prior to the end of
                              each fiscal year of Borrower.

                         9.   Annual financial statements, as soon as available,
                              and in any event within 120 days following the end
                              of Borrower's fiscal year, certified by
                              independent certified public accountants
                              acceptable to Silicon.

================================================================================

7.  COMPENSATION
    (Section 5.5):            Without Silicon's prior written consent, Borrower
                              shall not pay total compensation, including
                              salaries, withdrawals, fees, bonuses, commissions,
                              drawing accounts and other payments, whether
                              directly or indirectly, in money or otherwise,
                              during any fiscal year to all of Borrower's
                              executives, officers and directors (or any
                              relative thereof)



                                      -4-


                              as a group in excess of 115% of the total amount
                              thereof in the prior fiscal year.

================================================================================

8.  BORROWER INFORMATION:

        PRIOR NAMES OF
        BORROWER
        (Section 3.2):        As set forth in the Borrower's Representations and
                              Warranties dated September 11, 2001.

        PRIOR TRADE
        NAMES OF BORROWER
        (Section 3.2):        As set forth in the Borrower's Representations and
                              Warranties dated September 11, 2001.

        EXISTING TRADE
        NAMES OF BORROWER
        (Section 3.2):        As set forth in the Borrower's Representations and
                              Warranties dated September 11, 2001.

        OTHER LOCATIONS
        AND ADDRESSES
        (Section 3.3):        As set forth in the Borrower's Representations and
                              Warranties dated September 11, 2001.

        MATERIAL ADVERSE
        LITIGATION
        (Section 3.10):       Sanmina Corporation v. Novatel Wireless, Inc.,
                              Case No. CV 802384.

================================================================================

9.  OTHER COVENANTS
    (Section 5.1):            Borrower shall at all times comply with all of the
                              following additional covenants:

                              (1)  BANKING AND INVESTMENT RELATIONSHIP. Borrower
                                   shall at all times maintain its primary
                                   banking and investment relationship with
                                   Silicon and shall maintain at least 80% of
                                   its funds (including without limitation
                                   Borrower's deposit accounts and investment
                                   funds) with Silicon.

                              (2)  SUBORDINATION OF INSIDE DEBT. All present and
                                   future indebtedness of Borrower to its
                                   officers, directors and shareholders ("Inside
                                   Debt") shall, at all times, be subordinated
                                   to the Obligations pursuant to a
                                   subordination agreement on Silicon's standard
                                   form. Borrower represents and warrants that
                                   there is no Inside Debt presently
                                   outstanding, except for the following: NONE.
                                   Prior to incurring any Inside Debt in the
                                   future, Borrower shall cause the person to
                                   whom such Inside Debt will be owed to execute
                                   and deliver to Silicon a subordination
                                   agreement on Silicon's standard form.



                                      -5-


                              (3)  CONTROL AGREEMENTS. As to any Deposit
                                   Accounts and investment accounts maintained
                                   with another institution (including, without
                                   limitation, Bank of America), Borrower shall
                                   cause such institution, within 30 days after
                                   the date of this Loan Agreement, to enter
                                   into a control agreement in form acceptable
                                   to Silicon in its good faith business
                                   judgment in order to perfect Silicon's
                                   security interest in said Deposit Accounts
                                   and investment accounts.

                              (4)  BAILEE AGREEMENT. Within 30 days after the
                                   date hereof, Borrower shall cause Solectron
                                   Corporation and any other bailee or
                                   warehouseman at which Borrower maintains any
                                   Collateral to execute and deliver to Silicon,
                                   on Silicon's standard form (with such changes
                                   as shall be acceptable to Silicon in its
                                   discretion), a Notice to Bailee of Security
                                   Interest with respect to all Collateral
                                   maintained by Borrower at such bailee or
                                   warehouseman.

                              (5)  WARRANTS. Borrower shall provide Silicon with
                                   seven-year warrants to purchase 250,000
                                   shares (which number may be increased to
                                   500,000 shares as provided for in the Warrant
                                   to Purchase Stock) of common stock of the
                                   Borrower, at $0.83 per share (which price is
                                   equal to the average closing price per share
                                   of the common stock of Borrower for the 30
                                   trading days immediately preceding the Issue
                                   Date of the Warrant to Purchase Stock), on
                                   terms acceptable to Silicon, as set forth in
                                   the Warrant to Purchase Stock and related
                                   documents being executed concurrently with
                                   this Agreement. Said warrants shall be deemed
                                   fully earned on the date hereof, shall be in
                                   addition to all interest and other fees, and
                                   shall be non-refundable.

                              (6)  NOVATEL WIRELESS SOLUTIONS, INC. Borrower
                                   represents and warrants to Silicon that
                                   Novatel Wireless Solutions, Inc. is a wholly
                                   owned subsidiary of Borrower that is, and
                                   will remain throughout the term of this
                                   Agreement, inactive, with assets having an
                                   aggregate value of less than $10,000.
                                   Borrower covenants and agrees that while this
                                   Agreement is in effect, Borrower shall not
                                   transfer any assets or Collateral to Novatel
                                   Wireless Solutions, Inc.

                              (7)  AGILENT TECHNOLOGIES UCC. Within 10 days of
                                   the date hereof, Borrower shall cause Agilent
                                   Technologies to amend the UCC-1 Financing
                                   Statement(s) executed by Borrower in favor of
                                   Agilent Technologies to modify the collateral
                                   descriptions thereof such that the collateral
                                   is limited to the equipment leased to
                                   Borrower by Agilent Technologies and all
                                   additions, accessions, substitutions,
                                   attachments, improvements, repairs thereto
                                   and therefor and the proceeds of such leased
                                   equipment.



                                      -6-


Borrower:                                    Silicon:

  NOVATEL WIRELESS, INC.                     SILICON VALLEY BANK


  By                                         By
    -------------------------------            ---------------------------------
      President or Vice President            Title
                                                  ------------------------------

  By
    -------------------------------
     Secretary or Ass't Secretary



                                      -7-

EX-10.2

                                                                    EXHIBIT 10.2



                              SILICON VALLEY BANK
                          REGISTRATION RIGHTS AGREEMENT


        THIS REGISTRATION RIGHTS AGREEMENT is entered into as of November 29,
2001, by and between Silicon Valley Bank ("Purchaser") and the Company whose
name appears on the last page of this Agreement.

                                    RECITALS

        A. Concurrently with the execution of this Agreement, the Purchaser is
purchasing from the Company a Warrant to Purchase Stock (the "Warrant") pursuant
to which Purchaser has the right to acquire from the Company the Shares (as
defined in the Warrant).

        B. By this Agreement, the Purchaser and the Company desire to set forth
the registration rights of the Shares all as provided herein.

               NOW, THEREFORE, in consideration of the mutual promises,
covenants and conditions hereinafter set forth, the parties hereto mutually
agree as follows:

        1. Registration Rights. The Company covenants and agrees as follows:

              1.1 Definitions. For purposes of this Section 1:

                      (a) The term "register," "registered," and "registration"
refer to a registration effected by preparing and filing a registration
statement or similar document in compliance with the Securities Act of 1933, as
amended (the "Securities Act"), and the declaration or ordering of effectiveness
of such registration statement or document;

                      (b) The term "Registrable Securities" means (i) the Shares
(if Common Stock) or all shares of Common Stock of the Company issuable or
issued upon conversion of the Shares and (ii) any Common Stock of the Company
issued as (or issuable upon the conversion or exercise of any warrant, right or
other security which is issued as) a dividend or other distribution with respect
to, or in exchange for or in replacement of, any stock referred to in (i).

                      (c) The terms "Holder" or "Holders" means the Purchaser or
qualifying transferees under subsection 1.8 hereof who hold Registrable
Securities.

                      (d) The term "SEC" means the Securities and Exchange
Commission.



               1.2 Company Registration.

                      (a) Registration. If at any time or from time to time, the
Company shall determine to register any of its securities, for its own account
or the account of any of its shareholders, other than a registration on Form S-1
or S-8 relating solely to employee stock option or purchase plans, or a
registration on Form S-4 relating solely to an SEC Rule 145 transaction, or a
registration on any other form (other than Form S-1, S-2, S-3 or S-18, or their
successor forms) or any successor to such forms, which does not include
substantially the same information as would be required to be included in a
registration statement covering the sale of Registrable Securities, the Company
will:

                             (i) promptly give to each Holder written notice
thereof (which shall include a list of the jurisdictions in which the Company
intends to attempt to qualify such securities under the applicable blue sky or
other state securities laws); and

                             (ii) include in such registration (and compliance),
and in any underwriting involved therein, all the Registrable Securities
specified in a written request or requests, made within 30 days after receipt of
such written notice from the Company, by any Holder or Holders, except as set
forth in subsection 1.2(b) below.

                      (b) Underwriting. If the registration of which the Company
gives notice is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as a part of the written notice given
pursuant to subsection 1.2(a)(i). In such event the right of any Holder to
registration pursuant to this subsection 1.2 shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein. All
Holders proposing to distribute their securities through such underwriting shall
(together with the Company and the other shareholders distributing their
securities through such underwriting) enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting by the Company.

              1.3 Expenses of Registration. All expenses incurred in connection
with any registration, qualification or compliance pursuant to this Section 1
including without limitation, all registration, filing and qualification fees,
printing expenses, fees and disbursements of counsel for the Company and
expenses of any special audits incidental to or required by such registration,
shall be borne by the Company except the Company shall not be required to pay
underwriters' fees, discounts or commissions relating to Registrable Securities.
All expenses of any registered offering not otherwise borne by the Company shall
be borne pro rata among the Holders participating in the offering and the
Company.

              1.4 Registration Procedures. In the case of each registration,
qualification or compliance effected by the Company pursuant to this
Registration Rights Agreement, the Company will keep each Holder participating
therein advised in writing as to the initiation of each registration,
qualification and compliance and as to the completion thereof. Except as
otherwise provided in subsection 1.3, at its expense the Company will:



                                       2


                      (a) Prepare and file with the SEC a registration statement
with respect to such Registrable Securities and use its best efforts to cause
such registration statement to become effective, and, upon the request of the
Holders of a majority of the Registrable Securities registered thereunder, keep
such registration statement effective for up to 120 days.

                      (b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement.

                      (c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.

                      (d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holders, provided that the Company shall not be required in connection therewith
or as a condition thereto to qualify to do business or to file a general consent
to service of process in any such states or jurisdictions.

                      (e) In the event of any underwritten public offering,
enter into and perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.

                      (f) Notify each Holder of Registrable Securities covered
by such registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act or the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing.

              1.5     Indemnification.

                      (a) The Company will indemnify each Holder of Registrable
Securities and each of its officers, directors and partners, and each person
controlling such Holder, with respect to which such registration, qualification
or compliance has been effected pursuant to this Rights Agreement, and each
underwriter, if any, and each person who controls any underwriter of the
Registrable Securities held by or issuable to such Holder, against all claims,
losses, expenses, damages and liabilities (or actions in respect thereto)
arising out of or based on any untrue statement (or alleged untrue statement) of
a material fact contained in any prospectus, offering circular or other document
(including any related registration statement, notification or the like)
incident to any such registration, qualification or compliance, or based on any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statement therein not misleading, or any
violation or alleged violation by



                                       3


the Company of the Securities Act, the Securities Exchange Act of 1934, as
amended, ("Exchange Act") or any state securities law applicable to the Company
or any rule or regulation promulgated under the Securities Act, the Exchange Act
or any such state law and relating to action or inaction required of the Company
in connection with any such registration, qualification of compliance, and will
reimburse each such Holder, each of its officers, directors and partners, and
each person controlling such Holder, each such underwriter and each person who
controls any such underwriter, within a reasonable amount of time after incurred
for any reasonable legal and any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action; provided, however, that the indemnity agreement contained in this
subsection 1.5(a) shall not apply to amounts paid in settlement of any such
claim, loss, damage, liability, or action if such settlement is effected without
the consent of the Company (which consent shall not be unreasonably withheld);
and provided further, that the Company will not be liable in any such case to
the extent that any such claim, loss, damage or liability arises out of or is
based on any untrue statement or omission based upon written information
furnished to the Company by an instrument duly executed by such Holder or
underwriter specifically for use therein.

                      (b) Each Holder will, if Registrable Securities held by or
issuable to such Holder are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify the
Company, each of its directors and officers, each underwriter, if any, of the
Company's securities covered by such a registration statement, each person who
controls the Company within the meaning of the Securities Act, and each other
such Holder, each of its officers, directors and partners and each person
controlling such Holder, against all claims, losses, expenses, damages and
liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any such registration statement, prospectus, offering circular or other
document, or any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse the Company, such Holders, such directors,
officers, partners, persons or underwriters for any reasonable legal or any
other expenses incurred in connection with investigating, defending or settling
any such claim, loss, damage, liability or action, in each case to the extent,
but only to the extent, that such untrue statement (or alleged untrue statement)
or omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to the Company by an instrument
duly executed by such Holder specifically for use therein; provided, however,
that the indemnity agreement contained in this subsection 1.5(b) shall not apply
to amounts paid in settlement of any such claim, loss, damage, liability or
action if such settlement is effected without the consent of the Holder, (which
consent shall not be unreasonably withheld); and provided further, that the
total amount for which any Holder shall be liable under this subsection 1.5(b)
shall not in any event exceed the aggregate proceeds received by such Holder
from the sale of Registrable Securities held by such Holder in such
registration.

                      (c) Each party entitled to indemnification under this
subsection 1.5 (the "Indemnified Party") shall give notice to the party required
to provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the



                                       4


defense of any such claim or any litigation resulting therefrom; provided that
counsel for the Indemnifying Party, who shall conduct the defense of such claim
or litigation, shall be approved by the Indemnified Party (whose approval shall
not be unreasonably withheld), and the Indemnified Party may participate in such
defense at such party's expense; and provided further, that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations hereunder, unless such failure resulted in
prejudice to the Indemnifying Party; and provided further, that an Indemnified
Party (together with all other Indemnified Parties which may be represented
without conflict by one counsel) shall have the right to retain one separate
counsel, with the fees and expenses to be paid by the Indemnifying Party, if
representation of such Indemnified Party by the counsel retained by the
Indemnifying Party would be inappropriate due to actual or potential differing
interests between such Indemnified Party and any other party represented by such
counsel in such proceeding. No Indemnifying Party, in the defense of any such
claim or litigation, shall, except with the consent of each Indemnified Party,
consent to entry of any judgment or enter into any settlement which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party of a release from all liability in respect to such
claim or litigation.

              1.6 Information by Holder. Any Holder or Holders of Registrable
Securities included in any registration shall promptly furnish to the Company
such information regarding such Holder or Holders and the distribution proposed
by such Holder or Holders as the Company may request in writing and as shall be
required in connection with any registration, qualification or compliance
referred to herein.

              1.7 Rule 144 Reporting. With a view to making available to Holders
the benefits of certain rules and regulations of the SEC which may permit the
sale of the Registrable Securities to the public without registration, the
Company agrees at all times to:

                      (a) make and keep public information available, as those
terms are understood and defined in SEC Rule 144, after 90 days after the
effective date of the first registration filed by the Company for an offering of
its securities to the general public;

                      (b) file with the SEC in a timely manner all reports and
other documents required of the Company under the Securities Act and the
Exchange Act (at any time after it has become subject to such reporting
requirements); and

                      (c) so long as a Holder owns any Registrable Securities,
to furnish to such Holder forthwith upon request a written statement by the
Company as to its compliance with the reporting requirements of said Rule 144
(at any time after 90 days after the effective date of the first registration
statement filed by the Company for an offering of its securities to the general
public), and of the Securities Act and the Exchange Act (at any time after it
has become subject to such reporting requirements), a copy of the most recent
annual or quarterly report of the Company, and such other reports and documents
so filed by the Company as the Holder may reasonably request in complying with
any rule or regulation of the SEC allowing the Holder to sell any such
securities without registration.



                                       5


              1.8 Transfer of Registration Rights. Holders' rights to cause the
Company to register their securities and keep information available, granted to
them by the Company under subsections 1.2 and 1.7 may be assigned to a
transferee or assignee of a Holder's Registrable Securities not sold to the
public, provided, that the Company is given written notice by such Holder at the
time of or within a reasonable time after said transfer, stating the name and
address of said transferee or assignee and identifying the securities with
respect to which such registration rights are being assigned. The Company may
prohibit the transfer of any Holders' rights under this subsection 1.8 to any
proposed transferee or assignee who the Company reasonably believes is a
competitor of the Company.

        2. General.

              2.1 Waivers and Amendments. With the written consent of the record
or beneficial holders of at least a majority of the Registrable Securities, the
obligations of the Company and the rights of the Holders of the Registrable
Securities under this agreement may be waived (either generally or in a
particular instance, either retroactively or prospectively, and either for a
specified period of time or indefinitely), and with the same consent the
Company, when authorized by resolution of its Board of Directors, may enter into
a supplementary agreement for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement;
provided, however, that no such modification, amendment or waiver shall reduce
the aforesaid percentage of Registrable Securities without the consent of all of
the Holders of the Registrable Securities. Upon the effectuation of each such
waiver, consent, agreement of amendment or modification, the Company shall
promptly give written notice thereof to the record holders of the Registrable
Securities who have not previously consented thereto in writing. This Agreement
or any provision hereof may be changed, waived, discharged or terminated only by
a statement in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought, except to the extent
provided in this subsection 2.1.

              2.2 Governing Law. This Agreement shall be governed in all
respects by the laws of the State of California as such laws are applied to
agreements between California residents entered into and to be performed
entirely within California.

              2.3 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.

              2.4 Entire Agreement. Except as set forth below, this Agreement
and the other documents delivered pursuant hereto constitute the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof.

              2.5 Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by first class mail,
postage prepaid, certified or registered mail, return receipt requested,
addressed (a) if to Holder, at such Holder's address as set forth below, or at
such other address as such Holder shall have furnished to the Company in



                                       6


writing, or (b) if to the Company, at the Company's address set forth below, or
at such other address as the Company shall have furnished to the Holder in
writing.

              2.6 Severability. In case any provision of this Agreement shall be
invalid, illegal, or unenforceable, the validity, legality and enforceability of
the remaining provisions of this Agreement or any provision of the other
Agreement s shall not in any way be affected or impaired thereby.

              2.7 Titles and Subtitles. The titles of the sections and
subsections of this Agreement are for convenience of reference only and are not
to be considered in construing this Agreement.

              2.8 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.

PURCHASER                                    COMPANY

SILICON VALLEY BANK                          NOVATEL WIRELESS, INC.

By:   /s/ MILAD I. HANNA                     By:   /s/ JOHN MAJOR
     ------------------------------               ------------------------------
Name: Milad I. Hanna                         Name: John Major
     ------------------------------               ------------------------------
               (print)                                       (print)
Title: Sr. Vice President                    Title: Chairman of the Board,
      -----------------------------                 President or Vice President
Address:  3003 Tasman Drive                  Address: 9360 Towne Centre Drive,
          Santa Clara, CA  95054                      Suite 110
                                                      San Diego, CA  92121



                                       7

EX-23.2

                   CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-3 of our report dated
February 5, 2001 included in Novatel Wireless Inc.'s Form 10-K for the year
ended December 31, 2000 and to all references to our Firm included in this
registration statement.

/s/ ARTHUR ANDERSEN LLP

San Diego, California
January 21, 2002