Document:

<PAGE>

                                                                  EXHIBIT 10.22

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED
OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH
ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 OR
RULE 701 UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE
COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT
FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY AN AFFILIATE OF THE
COMPANY. NO SALE OR DISPOSITION OF THESE SHARES MAY BE EFFECTED EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION RELATED THERETO OR IN COMPLIANCE WITH RULE 144 OR
ITS SUCCESSOR OR PURSUANT TO AN OPINION OF COUNSEL THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

Warrant No.<<Warrant_no>>                        Number of Shares: <<Shares_no>>
                                                         (subject to adjustment)
Date of Issuance:  November 26, 2002

                           PERSISTENCE SOFTWARE, INC.

                              COMMON STOCK WARRANT
                              --------------------

         Persistence Software, Inc. (the "COMPANY"), for value received equal to
<<Amount>>, hereby certifies that <<Name>> or its registered assigns ("NEEDHAM"
or the "REGISTERED HOLDER"), is entitled, subject to the terms set forth below,
to purchase from the Company, at any time after the date hereof and on or before
the Expiration Date (as defined in Section 6 below), up to <<Shares_spelled>>
(<<Shares_no>>) shares (as adjusted from time to time pursuant to the provisions
of this Warrant) of Common Stock of the Company, at a per share Exercise Price
equal to $0.75 (subject to adjustment for stock splits, dividends and the like
and pursuant to that Registration Rights Agreement dated concurrently herewith
by and among the Company, the Registered Holder and other affiliates of
Needham). The shares purchasable upon exercise of this Warrant and the exercise
price per share, as adjusted from time to time pursuant to the provisions of
this Warrant and the Registration Rights Agreement, are hereinafter referred to
as the "WARRANT STOCK" and the "EXERCISE PRICE," respectively.

         This Warrant is issued pursuant to that certain Common Stock Purchase
Agreement dated approximately concurrently herewith among the Company and
Needham and two other entities affiliated with Needham (the "PURCHASE
AGREEMENT"). Any capitalized terms used herein, but not defined herein, shall
carry those definitions ascribed to them in the Purchase Agreement.

<PAGE>

         1. FULLY VESTED SHARES. The shares of Warrant Stock are fully vested
and exercisable as of the date of this Warrant.

         2. EXERCISE.

                  (a) METHOD OF EXERCISE.

                           (i) This Warrant may be exercised by the Registered
Holder, in whole or in part, by surrendering this Warrant, with the
purchase/exercise form appended hereto as EXHIBIT A duly executed by such
Registered Holder or by such Registered Holder's duly authorized attorney, at
the principal office of the Company, or at such other office or agency as the
Company may designate in writing prior to the date of such exercise, accompanied
by payment in full of the Exercise Price payable in respect of the number of
shares of Warrant Stock purchased upon such exercise. The Exercise Price may be
paid by cash, check, wire transfer or by the surrender of promissory notes or
other instruments representing indebtedness of the Company to the Registered
Holder.

                           (ii) In lieu of exercising this Warrant in the manner
provided above in Section 2(a)(i), the Registered Holder may, solely in
connection with a proposed Acquisition (and effective immediately prior to the
closing of such Acquisition), elect to receive shares equal to the value of this
Warrant (or the portion thereof being exercised) by surrender of this Warrant at
the principal office of the Company together with notice of such election on the
purchase/exercise form appended hereto as EXHIBIT A duly executed by such
Registered Holder or such Registered Holder's duly authorized attorney, in which
event the Company shall issue to holder a number of shares of Common Stock
computed using the following formula:

                                    X =  Y (A - B)
                                         ---------
                                             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 being exercised under
                      this Warrant.

                  A = The fair market value of one share of Common Stock
                      (on the exercise date as calculated below)

                  B = The Exercise Price (as adjusted to the exercise date).

         For purposes of this Section 2(a)(ii), the fair market value of one
share of Common Stock on the exercise date shall mean the consideration per
share to be received by the holders of Common Stock pursuant to such
Acquisition, as calculated pursuant to the agreement governing such Acquisition.

                  (b) EFFECTIVE TIME OF EXERCISE. Each exercise of this Warrant
shall be deemed to have been effected immediately prior to the close of business
on the day on which this Warrant shall have been surrendered to the Company as
provided in Section 2(a) above. At such time, the person or persons in whose

                                      -2-
<PAGE>

name or names any certificates for Warrant Stock shall be issuable upon such
exercise as provided in Section 2(c) below shall be deemed to have become the
holder or holders of record of the Warrant Stock represented by such
certificates.

                  (c) DELIVERY TO HOLDER. As soon as practicable after the
exercise of this Warrant in whole or in part, and in any event within 10 days
thereafter, the Company at its expense will cause to be issued in the name of,
and delivered to, the Registered Holder, or as such Registered Holder (upon
payment by such Registered Holder of any applicable transfer taxes) may direct:

                           (i) a certificate or certificates for the number of
shares of Warrant Stock to which such Registered Holder shall be entitled, and

                           (ii) in case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or faces thereof for the number of shares of Warrant Stock
equal (giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the number of such shares purchased
by the Registered Holder upon such exercise as provided in Section 2(a) above.

         3. ADJUSTMENTS.

                  (a) STOCK SPLITS AND DIVIDENDS. If the outstanding shares of
the Company's Common Stock shall be subdivided into a greater number of shares
or a dividend in Common Stock shall be paid in respect of Common Stock, the
Exercise Price in effect immediately prior to such subdivision or at the record
date of such dividend shall simultaneously with the effectiveness of such
subdivision or immediately after the record date of such dividend be
proportionately reduced. If outstanding shares of Common Stock shall be combined
into a smaller number of shares, the Exercise Price in effect immediately prior
to such combination shall, simultaneously with the effectiveness of such
combination, be proportionately increased. When any adjustment is required to be
made in the Exercise Price, the number of shares of Warrant Stock purchasable
upon the exercise of this Warrant shall be changed to the number determined by
dividing (i) an amount equal to the number of shares issuable upon the exercise
of this Warrant immediately prior to such adjustment, multiplied by the Exercise
Price in effect immediately prior to such adjustment, by (ii) the Exercise Price
in effect immediately after such adjustment.

                  (b) MERGER SALE, RECLASSIFICATION, ETC. In case of any (i)
consolidation or merger (including a merger in which the Company is the
surviving entity), (ii) sale or other disposition of all or substantially all of
the Company's assets or distribution of property to shareholders (other than
distributions payable out of earnings or retained earnings), or
reclassification, change or conversion of the outstanding securities of the
Company or of any reorganization of the Company (or any other corporation the
stock or securities of which are at the time receivable upon the exercise of
this Warrant) or any similar corporate reorganization on or after the date
hereof, then and in each such case the holder of this Warrant, upon the exercise
hereof at any time thereafter shall be entitled to receive, in lieu of the stock
or other securities and property receivable upon the exercise hereof prior to
such consolidation, merger, sale or other disposition, reclassification, change,
conversion or reorganization, the stock or other securities or property to which

                                      -3-
<PAGE>

such holder would have been entitled upon such consummation if such holder had
exercised this Warrant immediately prior thereto, all subject to further
adjustment as provided in Section 3(a) or 3(b); and in each such case, the terms
of this Section 3 shall be applicable to the shares of stock or other securities
properly receivable upon the exercise of this Warrant after such consolidation,
merger, sale or other disposition, reclassification, change, conversion or
reorganization.

                  (c) ADJUSTMENT CERTIFICATE. When any adjustment is required to
be made in the Warrant Stock or the Exercise Price pursuant to this Section 3,
the Company shall promptly mail to the Registered Holder a certificate setting
forth (i) a brief statement of the facts requiring such adjustment, (ii) the
Exercise Price after such adjustment and (iii) the kind and amount of stock or
other securities or property into which this Warrant shall be exercisable after
such adjustment.

         4. TRANSFERS.

                  (a) UNREGISTERED SECURITY. Each holder of this Warrant
acknowledges that this Warrant and the Warrant Stock have not been registered
under the Securities Act of 1933, as amended (the "SECURITIES ACT"), and agrees
not to sell, pledge, distribute, offer for sale, transfer or otherwise dispose
of this Warrant or any Warrant Stock issued upon its exercise in the absence of
(i) an effective registration statement under the Securities Act as to this
Warrant or such Warrant Stock and registration or qualification of this Warrant
or such Warrant Stock under any applicable U.S. federal or state securities law
then in effect or (ii) an opinion of counsel, reasonably satisfactory to the
Company, that such registration and qualification are not required. Each
certificate or other instrument for Warrant Stock issued upon the exercise of
this Warrant shall bear a legend substantially to the foregoing effect.

                  (b) TRANSFERABILITY. Subject to the provisions of Section 4(a)
hereof, this Warrant and all rights hereunder are transferable, in whole or in
part, to (i) any entity controlling, controlled by or under common control of
Needham, or (ii) to any other proposed transferee of at least 100,000 shares (as
adjusted for stock splits, stock dividends, reclassifications and the like) by
surrendering the Warrant with a properly executed assignment (in the form of
EXHIBIT B hereto) at the principal office of the Company.

                  (c) WARRANT REGISTER. The Company will maintain a register
containing the names and addresses of the Registered Holders of this Warrant.
Until any transfer of this Warrant is made in the warrant register, the Company
may treat the Registered Holder of this Warrant as the absolute owner hereof for
all purposes; PROVIDED, HOWEVER, that if this Warrant is properly assigned in
blank, the Company may (but shall not be required to) treat the bearer hereof as
the absolute owner hereof for all purposes, notwithstanding any notice to the
contrary. Any Registered Holder may change such Registered Holder's address as
shown on the warrant register by written notice to the Company requesting such
change.

         5. NO IMPAIRMENT. The Company will not, by amendment of its charter or
through reorganization, consolidation, merger, dissolution, sale of assets or
any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms of this Warrant, but will (subject to Section 14 below) at

                                      -4-
<PAGE>

all times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the holder of this Warrant against impairment.

         6. TERMINATION. This Warrant (and the right to purchase securities upon
exercise hereof) shall terminate on the earlier of: (i) November 26, 2007 or
(ii) the closing of any sale of all or substantially all of the assets of the
Company, or any merger, consolidation or any other transaction or series of
related transactions in which the Company's stockholders immediately prior
thereto own less than a majority of the voting stock of the Company (or its
successor or parent) immediately thereafter (an "ACQUISITION") (the "EXPIRATION
Date").

         7. NOTICES OF CERTAIN TRANSACTIONS. In case:

                  (a) the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution, or to receive any right to subscribe
for or purchase any shares of stock of any class or any other securities, or to
receive any other right, to subscribe for or purchase any shares of stock of any
class or any other securities, or to receive any other right, or

                  (b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company, any consolidation or merger of the Company with or into
another corporation (other than a consolidation or merger in which the Company
is the surviving entity), or any transfer of all or substantially all of the
assets of the Company, or

                  (c) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company,

then, and in each such case, the Company will mail or cause to be mailed to the
Registered Holder of this Warrant a notice specifying, as the case may be, (i)
the date on which a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such dividend,
distribution or right, or (ii) the effective date on which such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up is to take place, and the time, if any is to be fixed, as of which
the holders of record of Common Stock (or such other stock or securities at the
time deliverable upon such reorganization, reclassification, consolidation,
merger, transfer, dissolution, liquidation or winding-up) are to be determined.

         8. RESERVATION OF STOCK. The Company will at all times have authorized,
reserve and keep available, solely for the issuance and delivery upon the
exercise of this Warrant, such shares of Warrant Stock and other stock,
securities and property, as from time to time shall be issuable upon the
exercise of this Warrant.

         9. EXCHANGE OF WARRANTS. Upon the surrender by the Registered Holder of
any Warrant or Warrants, properly endorsed, to the Company at the principal
office of the Company, the Company will, subject to the provisions of Section 4
hereof, issue and deliver to or upon the order of such Holder, at the Company's

                                      -5-
<PAGE>

expense, a new Warrant or Warrants of like tenor, in the name of such Registered
Holder or as such Registered Holder (upon payment by such Registered Holder of
any applicable transfer taxes) may direct, calling in the aggregate on the face
or faces thereof for the number of shares of Common Stock called for on the face
or faces of the Warrant or Warrants so surrendered.

         10. REPLACEMENT OF WARRANTS. Upon 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) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.

         11. NOTICES. Any notice required or permitted by this Warrant shall be
in writing and shall be deemed duly given upon receipt, when delivered
personally or by courier, overnight delivery service or confirmed facsimile, or
48 hours after being deposited in the regular mail as certified or registered
mail (airmail if sent internationally) with postage prepaid, addressed (a) if to
the Registered Holder, to the address of the Registered Holder most recently
furnished in writing to the Company and (b) if to the Company, to the address
set forth on the signature page of this Warrant or as subsequently modified by
written notice to the Registered Holder.

         12. NO RIGHTS AS STOCKHOLDER. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a stockholder of the Company.

         13. NO FRACTIONAL SHARES. No fractional shares of Common Stock will be
issued in connection with any exercise hereunder. In lieu of any fractional
shares which would otherwise be issuable, the Company shall pay cash equal to
the product of such fraction multiplied by the fair market value of one share of
Common Stock on the date of exercise, as determined in good faith by the
Company's Board of Directors.

         14. AMENDMENT OR WAIVER. Any term of this Warrant may be amended or
waived upon written consent of the Company and the registered holders of at
least 50% of the Common Stock issuable upon exercise of the outstanding warrants
purchased pursuant to the Purchase Agreement. By acceptance hereof, the
Registered Holder acknowledges that in the event the required consent is
obtained, any term of this Warrant may be amended or waived with or without the
consent of the Registered Holder; PROVIDED, HOWEVER, that any amendment hereof
that would materially adversely affect the Registered Holder in a manner
different from the holders of the remaining warrants issued pursuant to the
Purchase Agreement shall also require the consent of Registered Holder.

         15. HEADINGS. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.

         16. GOVERNING LAW. This Warrant and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be governed,
construed and interpreted in accordance with the laws of the State of
California, without giving effect to principles of conflicts of law.

                                      -6-
<PAGE>

         17. REGISTRATION RIGHTS. The Warrant Shares are subject to the re-sale
registration rights described in the Registration Rights Agreement by and
between the Company and Needham and dated concurrently herewith.

         18. REPRESENTATIONS AND COVENANTS OF THE HOLDER. This Warrant has been
entered into by the Company in reliance upon the following representations and
covenants of the Registered Holder:

                   (a) INVESTMENT PURPOSE. Needham is acquiring the Warrant and
the Common Stock issuable upon exercise of the Warrant for its own account, not
as a nominee or agent and with no present intention of selling or otherwise
distributing any part thereof.

                   (b) PRIVATE ISSUE. The Registered Holder understands, except
as provided in the Registration Rights Agreement, (i) that neither the Warrant
nor the Common Stock issuable upon exercise of this Warrant is, nor will be,
registered under the Securities Act or qualified under applicable state
securities laws on the ground that the issuance contemplated by this Warrant
will be exempt from the registration and qualifications requirements thereof
pursuant to Section 4(2) of the Securities Act and any applicable state
securities laws, and (ii) that the Company's reliance on such exemption is
predicated on the representations set forth in this Section 18.

                   (c) DISPOSITION OF HOLDER'S RIGHTS. In no event will the
Registered Holder make a disposition of the Warrant or the Common Stock issuable
upon exercise of the Warrant in the absence of (i) an effective registration
statement under the Securities Act as to this Warrant or such Warrant Stock and
registration or qualification of this Warrant or such Warrant Stock under any
applicable U.S. federal or state securities law then in effect or (ii) an
opinion of counsel, reasonably satisfactory to the Company, that such
registration and qualification are not required. Notwithstanding the foregoing,
the restrictions imposed upon the transferability of any of its rights to
acquire Common Stock or Common Stock issuable on the exercise of such rights do
not apply to transfers from the beneficial owner of any of the aforementioned
securities to its nominee or from such nominee to its beneficial owner, and
shall terminate as to any particular share of Common Stock when (1) such
security shall have been effectively registered under the Securities Act and
sold by the holder thereof in accordance with such registration or (2) such
security shall have been sold without registration in compliance with Rule 144
under the Securities Act, or (3) a letter shall have been issued to the
Registered Holder at its request by the staff of the Securities and Exchange
Commission (the "SEC") or a ruling shall have been issued to the Registered
Holder at its request by the SEC stating that no action shall be recommended by
such staff or taken by SEC, as the case may be, if such security is transferred
without registration under the Securities Act in accordance with the conditions
set forth in such letter or ruling and such letter or ruling specifies that no
subsequent restrictions on transfer are required. Whenever the restrictions
imposed hereunder shall terminate, as hereinabove provided, the Registered
Holder or holder of a share of Common Stock then outstanding as to which such
restrictions have terminated shall be entitled to receive from the Company,
without expense to such holder, one or more new certificates for the Warrant or
for such shares of Common Stock not bearing any restrictive legend.

                                      -7-
<PAGE>

                   (d) FINANCIAL RISK. The Registered Holder has such business
and financial experience as is required to give it the capacity to protect its
own interests in connection with its investment.

                   (e) ACCREDITED INVESTOR. The Registered Holder is an
"accredited investor" as defined by Rule 501 of Regulation D under the
Securities Act, as presently in effect.

          19. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. This Warrant has
been entered into by Needham in reliance upon the following representations and
covenants of the Company:

                  (a) AUTHORIZATION: The Warrant has been duly executed and
delivered by the Company and constitutes a legal, valid and binding obligation
of the Company enforceable in accordance with its terms, subject to laws of
general application relating to bankruptcy, insolvency and the relief of debtors
and rules of law governing specific performance, injunctive relief or other
equitable remedies.

                  (b) VALID ISSUANCE. The Warrant Stock is duly authorized and
reserved for issuance, and when issued, sold and delivered in accordance with
the terms of this Warrant will be duly and validly issued, fully paid and
nonassessable.

                  (c) NO CONFLICT. The execution and delivery of this Warrant do
not, and the consummation of the transactions contemplated hereby will not,
conflict with, or result in any violation of, breach or default (with or without
notice or lapse of time, or both), or give rise to a right of termination,
cancellation or acceleration of any obligation or to a loss of a material
benefit, under, any provision of the Certificate of Incorporation or Bylaws of
the Company or any material agreement attached as an exhibit to the Company's
SEC Documents (as defined in the Purchase Agreement), or any judgment, order,
decree, statute, law, ordinance, rule, listing requirement or regulation
applicable to the Company, its properties or assets, which conflict, violation,
default or right would have a material adverse effect on the business,
properties, prospects, financial condition or operations of the Company.

          20. COUNTERPARTS. This Warrant may be executed in counterparts, and
each such counterpart shall be deemed an original for all purposes.

                            [SIGNATURE PAGES FOLLOW]

                                      -8-
<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Common Stock Warrant
as of the date first above written.

                                   PERSISTENCE SOFTWARE, INC.

                                   By _________________________________________

                                   Name:_______________________________________
                                                      (print)
                                   Title:______________________________________

                                   Address:  Persistence Software Inc.
                                             1720 S. Amphlett Blvd, 3rd Floor
                                             San Mateo, CA 94402
                                             Attention:  Chief Financial Officer

                                   Fax Number: (650) 341-8432

AGREED TO AND ACCEPTED BY:

<<NAME>>

By  ________________________________________

Name:  _____________________________________
                  (print)

Title:  ____________________________________

Address:     3000 Sand Hill Road
             Building 2, Suite 190
             Menlo Park, CA 94025

Fax Number: (650) 854-9853

                     SIGNATURE PAGE TO COMMON STOCK WARRANT

<PAGE>

                                   EXHIBIT A
                                   ---------

                             PURCHASE/EXERCISE FORM
                             ----------------------

To:      Persistence Software, Inc.                        Dated:

         The undersigned, pursuant to the provisions set forth in the attached
Warrant No. <<Warrant_no>>, hereby irrevocably elects: (a) to purchase _____
shares of the Common Stock covered by such Warrant and herewith makes payment of
$ _________, representing the full purchase price for such shares at the price
per share provided for in such Warrant, or (b) solely in connection with an
Acquisition, to exercise such Warrant for _______ shares purchasable under the
Warrant pursuant to the "net issue exercise" provisions of Section 2(a)(ii) of
such Warrant.

         The undersigned acknowledges that it has reviewed the representations
and warranties contained in Section 18 of the Warrant and by its signature below
hereby makes such representations and warranties to the Company. Defined terms
contained in such representations and warranties shall have the meanings
assigned to them in the Warrant.

                                Signature:  ____________________________________

                                Name (print):  _________________________________

                                Title (if applic.):  ___________________________

                                Company (if applic.):  _________________________

<PAGE>

                                    EXHIBIT B
                                    ---------

                                 ASSIGNMENT FORM
                                 ---------------

         FOR VALUE RECEIVED, _________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned under the
attached Warrant with respect to the number of shares of Common Stock covered
thereby set forth below, unto:

   NAME OF ASSIGNEE              ADDRESS/FAX NUMBER                NO. OF SHARES
   ----------------              ------------------                -------------

Dated: _____________________           Signature:_______________________________

                                                 _______________________________

                                       Witness:  _______________________________<PAGE>
EXHIBIT 10.3

                        ASSIGNMENT OF ACCOUNTS RECEIVABLE
                        ---------------------------------

         THIS ASSIGNMENT is made and entered into as of September 7, 2001, by
and between Telenetics Corporation, a California corporation ("Assignor") and
Comtel Electronics Inc., a Delaware corporation ("Assignee"), together, called
the "Parties," as follows:

                                    RECITALS
                                    --------

         WHEREAS, the Assignor is indebted to the Assignee for certain products
manufactured and delivered to the Assignor, such indebtedness being evidenced by
one or more accounts payable of Assignor to Assignee, being described more
particularly on Schedule "A" annexed hereto (herein, the "Payables"); and

         WHEREAS, the Payables have aged beyond the net sixty day payment terms
agreed to in a previous manufacturing agreement between the Parties;

         WHEREAS, the Assignee and its secured lender, UPS Capital Corporation
("UPSC"), require payment in some form and fashion to alleviate this payment
delinquency;

         WHEREAS, the Parties intend to establish a mechanism by which the
Assignor shall assign certain accounts receivable that have been approved by
UPSC to the Assignee in return for reducing the outstanding balance of the
Payables:

                                    AGREEMENT
                                    ---------

         NOW THEREFORE, in consideration of the mutual covenants and agreements
of the parties contained herein, and other valuable consideration the receipt
and sufficiency of which are hereby acknowledged, the Parties agree as follows:

                                   ASSIGNMENT
                                   ----------

         1. For value received, Assignor hereby sells, transfers and assigns to
Assignee all of Assignor's right, title, and interest in and to all those
accounts receivable of Assignor set forth on Schedule "B" annexed hereto
(herein, the "Accounts"). All assigned interests in the Accounts are to be WITH
FULL RECOURSE, shall take effect as of the date hereof and shall include any
security or guaranties given to or held by Assignor, including proceeds of any
credit insurance that is or that may become due and payable with respect to the
Accounts.

                                     CREDIT
                                     ------

         2. In consideration of the foregoing assignment, Assignee hereby
credits against the indebtedness of Assignor to Assignee under the Payables an
amount equal to the "Credited Sum" specified on Schedule "B" annexed hereto,
effective on the date hereof; but, Assignor shall be and remain liable to
Assignee for the balance owing on the Payables, after application thereto of the
Credited Sum. The Credited Sum shall be applied to the Payables in chronological
order, from the earliest listed to the latest.

<PAGE>

                               RIGHTS OF ASSIGNEE
                               ------------------

         3. The rights transferred to Assignee in respect of the Accounts
include the following:

                  (a) Notwithstanding paragraph 4 below, the right (but not the
         obligation) to make and effect collections from the account debtors in
         Assignee's own name and for its own benefit; and

                  (b) The right to endorse and deposit in Assignee's own bank
         account any payments, commercial paper, notes, or other acceptances
         received in full or partial payment of the Accounts or the goods
         represented by and sold under such Accounts. In the event goods
         represented by the Accounts are not received or accepted, or are
         returned by the purchasers, the title to any account, contract, or any
         goods created through the resale or exchange of the rejected goods,
         including all sums of money due and to become due, shall be the
         property of Assignee.

                         NOTIFICATION OF ACCOUNT DEBTORS
                         -------------------------------

         4. Assignor and Assignee shall jointly notify the account debtors of
this Assignment of the Accounts, which notice shall provide that the account
debtors shall pay Assignee directly all sums due or to become due with respect
to the Accounts. The notification shall be substantially in the same form as
Exhibit "A" hereto. Assignor shall provide Assignee with copies of all notices
sent in accordance with this paragraph.

                    REPORTING AND ASSIGNMENT OF NEW ACCOUNTS
                    ----------------------------------------

         5. So long as any balance of the Payables remains outstanding and
unpaid, within three (3) business days of the close of each calendar month,
Assignor shall provide Assignee with a schedule (the "New Account Report"), in
substantially the same form and containing substantially the same information as
Schedule "B" annexed hereto, listing all accounts coming into existence after
the date of the previous New Account Report (or, in the case of the first New
Account Report, all accounts coming into existence after the date of this
Assignment). Upon receipt of each such New Account Report, Assignor may (and, at
the request of UPSC, Assignor shall) require that Assignor make further
assignments of such accounts to Assignor. In such event, Assignee shall review
all new accounts and notify Assignor which are approved for assignment and
Assignor shall thereupon transfer and assign such accounts to Assignee, in
substantially the same form and manner as set forth herein.

                             COLLECTION OF ACCOUNTS
                             ----------------------

         6. Except to the extent Assignee notifies Assignor otherwise, Assignee
shall take all reasonable and appropriate steps to enforce and collect the
Accounts, at Assignor's expense, and to direct payment of the Accounts to
Assignee. To the extent any account debtor directs payment on an Accounts
Receivable to Assignor instead of to Assignee, Assignor shall immediately
deliver to Assignee any payments, commercial paper, notes, or other acceptances
received by Assignor. Throughout the term of this agreement, Assignor shall
promptly provide Assignee with such information, notices and other cooperation
as Assignee may reasonably request to facilitate collection of the Accounts.

                                      -2-

<PAGE>

                           REPRESENTATIONS OF ASSIGNOR
                           ---------------------------

         7. Assignor represents and warrants that the following statements are
true and correct:

                  (a) Copies of any and all financial statements, invoices,
         orders, proofs of delivery, and other documents submitted to Assignee
         in connection with this Assignment, including the information contained
         in Schedule "B" hereto, are factual and genuine. The same is true of
         information to be supplied in New Account Reports;

                  (b) This Assignment is exclusive and made solely to the
         Assignee. None of the Accounts has been or will be sold or assigned to
         any other party, no security interest in the Accounts has been or will
         be granted to any other party (or if any security interest has been
         granted, it is no longer in effect), and no other person or entity
         other than Assignor otherwise has acquired or will acquire any lien,
         right, title, or claim to the Accounts;

                  (c) All existing Accounts are valid and fully collectible from
         the account debtors. There are no offsets or counterclaims against any
         of the existing Accounts. There are no other circumstances entitling
         the account debtors to decline to pay existing Accounts or to decrease
         the price of the goods as originally agreed upon in the invoices. The
         account debtors are unconditionally indebted to Assignor for the
         amounts set forth in Schedule "B" hereto. The foregoing will be true as
         to all accounts listed in New Account Reports;

                  (d) The goods described in and covered by the Account invoices
         and statements listed in Schedule "B" hereto were sold in strict
         accordance with the specifications provided by the purchasers, and such
         goods have been sold pursuant to unconditional contracts of sale and
         not by consignment or sale on approval. The same will be true with
         respect to goods covered by Account invoices listed in all New Account
         Reports;

                  (e) Assignor delivered goods described in and covered by the
         Account invoices and statements listed in Schedule "B" hereto pursuant
         to genuine purchase orders issued by the purchasers. Delivery was made
         at the request of the purchasers and in accordance with the shipping
         instructions included in those purchase orders. As of the date of this
         Assignment, none of the purchase orders received by the Assignor has
         been cancelled or otherwise altered by purchasers or their agents. The
         same will be true of goods described and covered by account invoices
         listed in all New Account Reports;

                  (f) The goods described in and covered by the Account invoices
         and statements listed in Schedule "B" have not been previously sold,
         conveyed, or encumbered by Assignor or its agents. The same will be
         true of goods covered by the Account invoices and statements listed in
         all New Account Reports;

                                      -3-

<PAGE>

                  (g) As of the date of this Assignment, the account debtors
         have not paid to Assignor, or its agents, all or part of the purchase
         price of the goods described in and covered by the Account invoices and
         statements listed in Schedule "B". The same will be true of amounts
         listed in all New Account Reports.

         Upon Assignee's request, Assignor shall execute written affirmations of
the foregoing warranties and representations in connection with each New Account
Report. Assignor acknowledges that Assignee intends to collateralize certain
financing with the Accounts and that Assignee, its lender(s), and other third
parties intend to rely on the foregoing representations and warranties as well
as other representations made hereto.

                 FILING AND EXECUTION OF FINANCING STATEMENT(S)
                 ----------------------------------------------

         8. Filing and Execution of Financing Statement(s):

                  (a) Assignee and its agents shall be and hereby is authorized
         to file one or more UCC-1 financing statements and related documents to
         effectuate the terms hereof, and to execute the same on Assignor's
         behalf. To the extent necessary and allowed by law, Assignor hereby
         irrevocably appoints Assignee, acting singly, as the Assignor's
         attorney-in-fact, which power is coupled with an interest, with full
         authority in the place and stead of Assignor, to execute any financing
         statement, amendment thereto, or continuation thereof, relative to all
         or any portion of the Accounts in the name of Assignor or without the
         signature of Assignor.

                  (b) Assignee and its agents shall be and hereby is authorized
         to file one or more UCC-1 financing statements and related documents to
         effectuate the terms hereof, and to execute the same on Assignor's
         behalf. To the extent necessary and allowed by law, Assignor hereby
         irrevocably appoints Assignee, acting singly, as the Assignor's
         attorney-in-fact, which power is coupled with an interest, with full
         authority in the place and stead of Assignor, to execute any financing
         statement, amendment thereto, or continuation thereof, relative to all
         or any portion of the Accounts in the name of Assignor or without the
         signature of Assignor.

                      MAINTENANCE AND INSPECTION OF RECORDS
                      -------------------------------------

         9. Assignor shall at all times keep complete and accurate records
concerning the Accounts, all of which records shall be available for inspection
and/or copying on demand by Assignee during usual business hours.

                                 TIME OF ESSENCE
                                 ---------------

         10. Time is of the essence in this Assignment.

                              EFFECT ON SUCCESSORS
                              --------------------

         11. This Assignment, and each of its provisions, shall be binding on
and shall inure to the benefit of the respective heirs, devisees, legatees,
executors, administrators, trustees, successors, and assigns of the parties to
this Assignment. Without limitation of the foregoing, Assignor acknowledges and

                                      -4-

<PAGE>

agrees that Assignor has assigned all of its rights (but none of its
obligations) hereunder to UPSC and that UPSC, in the place and stead of
Assignee, may enforce the terms of this Assignment against Assignor hereafter as
fully and completely as Assignor may do, provided that, in doing so, UPSC shall
be subject to no right of setoff, defense or counterclaim which Assignor now
has, or hereafter may have, against Assignee unrelated to this Assignment.

                                    AMENDMENT
                                    ---------

         12. This Assignment may be amended only by a writing signed by the
party against whom or against whose successors and assigns enforcement of the
change is sought. In any event, no amendment, modification, waiver or other
alteration made to this Assignment or in respect of any Account which is made
without the prior written consent of UPSC shall bind UPSC.

                          EFFECT OF PARTIAL INVALIDITY
                          ----------------------------

         13. If any term or provision of this Assignment or any application
thereof shall be held invalid or unenforceable, the remainder of this Assignment
and any application of the terms and provisions shall not be affected thereby,
but shall remain valid and enforceable.

                                     NOTICES
                                     -------

         14. All notices, demands, or other communications between Assignor and
Assignee shall be in writing and addressed as set forth immediately below
(unless and except to the extent that either Party receives written notice from
the other Party as to change of address). All such communications shall be
deemed effective upon the earliest of (i) actual delivery if delivered by
personal delivery, or (ii) three (3) calendar days after deposit, first class
postage prepaid, with the United States Mail.

                           Telenetics Corporation
                           25111 Arctic Ocean
                           Lake Forest, CA  92630
                           Attn:  Chief Financial Officer

                           Comtel Electronics Inc.
                           14101 Myford Road
                           Tustin, CA  92780
                           Attn:  Chief Financial Officer

                                  GOVERNING LAW
                                  -------------

         15. This Assignment shall be governed by and construed in accordance
with the laws of the State of California.

                        [SIGNATURES APPEAR ON NEXT PAGE.]

                                      -5-

<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Assignment as of the
date first written above.

                                        TELENETICS CORPORATION,
                                        a California corporation

                                        By: /S/ SHALA SHASHANI LUTZ
                                            ------------------------------------
                                                                      ,President

                                        By: /S/ DAVID L. STONE
                                            ------------------------------------
                                                                      ,Secretary

                                        COMTEL ELECTRONICS INC.,
                                        a Delaware corporation

                                        By: /S/ LYLE JENSEN
                                            ------------------------------------
                                                                            ,CEO

                                        By: /S/ MICHAEL GRAY
                                            ------------------------------------
                                                                      ,Secretary

                                      -6-

<PAGE>

                         EXHIBIT "A" SAMPLE NOTIFICATION
                         -------------------------------

______________________
Attn: Accounts Payable
______________________
______________________

Dear Sir or Madam:

         Please take notice that on September 7, 2001, Telenetics Corporation
assigned and transferred to Comtel Electronics Inc. all of its right, title, and
interest in and to the following accounts:

Invoice # _____            Amount Due        $ ________

         You are directed to make all further payments on the above-described
invoices as follows:
FOR CHECKS PLEASE MAIL TO:
--------------------------

                           Comtel Electronics Inc.
                           Bank of America Lockbox Services
                           Lockbox #56690
                           1000 W. Temple St., Ground Level
                           Los Angeles, CA 90012

                           FOR WIRE TRANSFERS:
                           -------------------

                           Swift Code:   BOFAUS44
                           Account Name: UPS CAPITAL CORP COMTEL CA
                           ABA #: 111000012
                           ACCOUNT #: 3751784575
                           Lockbox #: 056690  (Optional)

Please contact Greg Rassp, (714) 508-3419, at Comtel Electronics if you have any
questions.

         Your payment to the designated assignee shall discharge you from your
obligation under the invoices described above.

                                            TELENETICS CORPORATION

                                            By:  _______________________________

                                                 ____________________, President

                                            By:  _______________________________

                                                 ____________________, Secretary

                                      -7-

<PAGE>

                        SCHEDULE "B" SCHEDULE OF ACCOUNTS
                        ---------------------------------

     Telenetics Accounts Receivable Balances to be assigned are as follows:

<TABLE>
<CAPTION>

                                                                             AMOUNT APPROVED FOR
           NAME                                         ACCOUNT BALANCE          ASSIGNMENT
           ----                                         ---------------          ----------
<S>                                                       <C>                    <C>
Black Box Corp......................................       $43,023.21             $40,725.71

Data Connect Enterprises............................      $843,024.52            $253,609.61

Ingram Micro........................................      $286,502.53            $286,502.53

Open Systems Inter..................................        $7,940.34              $7,940.00

GE Harris Energy Systems 101........................        $9,256.19              $9,256.19

GE Harris Energy Systems 107........................       $47,917.23             $47,917.23

GE Harris Energy Systems 108........................        $6,251.50              $6,251.50

                                                          CREDITED SUM:          $652,202.77
                                                                                 ===========
</TABLE>

                                      -8-

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