Edgar Filing: CELLPOINT INC

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 31, 2001.
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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CELLPOINT INC.
(Exact name of registrant as specified in its charter)

3000 HILLSWOOD DRIVE
NEVADA HILLSWOOD BUSINESS PARK
(State or other jurisdiction CHERTSEY, SURREY, KT16 0RS ENGLAND 52-2032380
of +44 1932 895 310 (I.R.S. Employer
incorporation or organization) (Address of principal executive offices) Identification No.)
3000 HILLSWOOD DRIVE
HILLSWOOD BUSINESS PARK
CHERTSEY, SURREY, KT16 0RS ENGLAND
+44 1932 895 310
ATTENTION: PETER HENRICSSON
(Name and address of agent for service)
With a copy to:
MICHAEL PAIGE, ESQ.
JACKSON & CAMPBELL, P.C.
1120 20TH STREET, N.W., SOUTH TOWER
WASHINGTON, D.C. 20036
(202) 457-1600 FACSIMILIE: (202) 457-1678

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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box............................................................................9
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....................................:
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
registration statement for the same offering...................................9
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..........................................................9
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.................................................9
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CALCULATION OF REGISTRATION FEE

AMOUNT TO AMOUNT OF
TITLE OF SECURITIES TO BE REGISTERED BE REGISTERED PRICE PER SHARE AGGREGATE PRICE REGISTRATION FEE

Common Stock, par value $0.001 per share..... 6,142,447 $1.67(1)(2) $10,257,886 $2,564.47
Common Stock, par value $0.001 per share..... 1,625,000 (3) $ 3,656,250 $ 914.06
Common Stock, par value $0.001 per share..... 784,071 (4) $ 1,850,408 $ 462.60
Common Stock, par value $0.001 per share..... 619,048 (5) $ 2,630,954 $ 657.74
Common Stock, par value $0.001 per share..... 67,451 (6) $ 89,035 $ 22.26
Common Stock, par value $0.001 per share..... 600,000 (7) $ 1,884,000 $ 471
Common Stock, par value $0.001 per share..... 385,810(8) $ 1.67(1) $ 644,303 $ 161.08
Common Stock, par value $0.001 per share..... 107,142 $ 1.67(1) $ 178,927 $ 44.73
Common Stock, par value $0.001 per share..... 53,571 (9) $ 133,928 $ 33.48
TOTAL........................................ 10,384,540 $21,267,932 $5,316.98

(1) Estimated solely for the purposes of calculating the registration fee,
pursuant to Rule 457(c), based on the average bid and asked price of the
Registrant's Common Stock as reported on the NASDAQ National Market on
October 25, 2001.
(2) Shares registered hereunder were issued by the Registrant in an offerings
made pursuant to Rule 506 under Regulation D pursuant to the Securities Act
and under Regulation S pursuant to the Securities Act.
(3) Shares registered hereunder will become issuable upon the exercise of
warrants issued by the Registrant in an offering made pursuant to Rule 506
under Regulation D pursuant to the Securities Act. The warrants have an
exercise price of $2.25 per share.
(4) Shares registered hereunder will become issuable upon the exercise of
warrants issued by the Registrant in an offering made pursuant to Rule 506
under Regulation S pursuant to the Securities Act. The warrants have an
exercise price of $2.36 per share.
(5) Shares registered hereunder will become issuable upon the exercise of
warrants issued by the Registrant of man offering made pursuant to Rule 506
under Regulation D pursuant to the Securities Act. Half of these warrants
have an exercise price of $3.50 per share and half have an exercise price of
$5.00 per share.
(6) Shares registered hereunder will become issuable upon the exercise of
warrants issued pursuant to exempt offerings pursuant to the Securities Act.
The warrants have an exercise price of $1.32 per share.
(7) This number represents 120% of the shares issuable by the Registrant upon
the exercise of warrants at $3.14 per share. The warrant was issued by
Registrant pursuant to Section 4(2) of the Securities Act.
(8) Shares registered hereunder will become issuable upon conversion of a
convertible note issued by Registrant in an offering made pursuant to
Section 4(2) of the Securities Act.
(9) Shares registered hereunder will become issuable upon the exercise of
warrants at $2.50 per share issued by the Registrant in an offering made
pursuant to Section 4(2) of the Securities Act.
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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 THAT SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.

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CELLPOINT INC.
CROSS REFERENCE SHEET

ITEM NUMBER OF CAPTION LOCATION OR HEADING IN PROSPECTUS
---------------------- ---------------------------------

1. Forepart of the Registration Statement and Forepart of the Registration Statement and
Outside Front Cover Page of Prospectus Outside Front Cover Page of Prospectus

2. Inside Front and Outside Back Cover Pages Inside Front and Outside Back Cover Pages
of Prospectus of Prospectus

3. Summary Information, Risk Factors and Summary Information, Risk Factors
Ratio of Earnings to Fixed Charges

4. Use of Proceeds Use of Proceeds

5. Determination of Offering Price *

6. Dilution *

7. Selling Security Holders Selling Stockholders

8. Plan of Distribution Plan of Distribution

9. Description of Securities Being Registered Description of Securities

10. Interest of Named Experts and Counsel *

11. Material Changes Summary Information, Business

12. Incorporation of Certain Information by Incorporation of Information We File with
Reference the SEC

13. Disclosure of Commission Position on Indemnification
Indemnification for Securities Act
Liabilities

14. Other Expenses of Issuance and Other Expenses of Issuance and
Distribution Distribution

15. Indemnification of Directors and Officers Indemnification of Directors and Officers

16. Exhibits Exhibits

17. Undertakings Undertakings

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* Omitted from Prospectus because item is inapplicable or answer is in the
negative.

THIS PRELIMINARY OFFICIAL STATEMENT AND THE INFORMATION CONTAINED HEREIN ARE
SUBJECT TO COMPLETION OR AMENDMENT WITHOUT NOTICE. THESE SECURITIES MAY NOT BE
SOLD NOR MAY OFFERS TO BUY THEM BE ACCEPTED, PRIOR TO THE TIME THE OFFICIAL
STATEMENT IS DELIVERED IN FINAL FORM. UNDER NO CIRCUMSTANCES SHALL THIS
PRELIMINARY OFFICIAL STATEMENT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF
AN OFFER TO BUY, NOR SHALL THERE BE ANY SALE OF, THESE SECURITIES IN ANY
JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION, QUALIFICATION OR FILING UNDER THE SECURITIES LAWS OF ANY SUCH
JURISDICTION.

PROSPECTUS REGISTRATION NO. 333- -

CELLPOINT INC.
10,384,540 SHARES OF COMMON STOCK

This Prospectus is being used by certain stockholders (the "Selling
Stockholders") of CellPoint Inc. to sell an aggregate of up to 10,384,540 shares
(the "Shares") of our Common Stock, par value $.001 per share ("Common Stock").
The Selling Stockholders will sell the Common Stock, from time to time, at
prices then attainable, less ordinary brokers' commissions and dealers'
discounts, as applicable. The Shares were offered and sold to the Selling
Stockholders pursuant to private offerings in which the Shares were not
registered with the Securities and Exchange Commission. The Shares are being
offered solely for the account of the Selling Stockholders. For more information
about the Selling Stockholders, please refer to the sections entitled "Summary
of Offering" and "The Selling Stockholders".

Our Common Stock trades on the NASDAQ National Market ("NASDAQ") under the
symbol CLPT. On October 25, 2001 the last reported sale price per share of
Common Stock was $1.67.

INVESTING IN OUR COMMON STOCK INVOLVES RISKS THAT ARE DESCRIBED IN THE "RISK
FACTORS" SECTION BEGINNING ON PAGE 8 OF THIS PROSPECTUS.

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PROCEEDS TO
ISSUER OR
PRICE TO OTHER
PUBLIC PERSONS(2)

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Per Share $1.67(1) (1,2)
Total $17,342,181(1) (1,2)
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(1) Estimated, based upon the last reported sale price of our Common Stock on
October 25, 2001.

(2) We will receive no part of the proceeds from the sale of the shares
described in this Prospectus. All proceeds will go to the Selling
Stockholders, and the amount set forth above assumes that all Shares
described in this Prospectus are sold. To the extent that the shares being
sold by the Selling Stockholders represent issuances upon the exercise of
warrants, we will receive proceeds equal to the cash exercise price paid by
the holders of such warrants. Our estimated expenses in connection with this
Prospectus are approximately $109,236.

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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

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The date of this Prospectus is , 2001.

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING OR SOLICITATION WITH RESPECT TO
THESE SECURITIES BY THE COMPANY TO ANY PERSON WHO MAY BE CONSIDERED TO BE AN
UNDERWRITER OR TO ANY PERSON IN ANY STATE IN WHICH SAID OFFERING OR SOLICITATION
IS NOT AUTHORIZED BY THE LAWS THEREOF OR IN WHICH THE PERSON MAKING SAID
OFFERING OR SOLICITATION IS NOT QUALIFIED TO ACT AS DEALER OR BROKER OR
OTHERWISE TO MAKE SUCH OFFERING OR SOLICITATION.

WE HAVE AGREED TO FILE AMENDMENTS TO THE REGISTRATION STATEMENT OF WHICH
THIS PROSPECTUS IS A PART IN ORDER TO INFORM POTENTIAL PURCHASERS OF THE COMMON
STOCK OF ANY FACTS OR EVENTS ARISING AFTER THE DATE OF THIS PROSPECTUS WHICH ARE
MATERIAL TO SUCH PURCHASER'S INVESTMENT DECISION. WE WILL DISTRIBUTE ANY SUCH
AMENDMENTS TO THIS PROSPECTUS TO THE SELLING STOCKHOLDERS AFTER SUCH AMENDMENT
HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.

FORWARD-LOOKING STATEMENTS

Certain statement contained in this Prospectus contain "forward looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended (the "Securities Act") and Section 21E of the Securities Exchange Act of
1934, as amended (the "Exchange Act"). These are statements that do not relate
strictly to historical or current facts. Although we believes that our plans,
intentions and expectations reflected in such forward looking statements are
reasonable, we can give no assurance that such plans, intentions or expectations
will be achieved. Such forward-looking statements involve known and unknown
risks and uncertainties. Our actual actions or results may differ materially
from those discussed in the forward-looking statements. These risk factors are
summarized below and are set forth in more detail in this Prospectus under "Risk
Factors". All forward looking statements attributable to the Company or persons
acting on its behalf are expressly qualified in their entirety by the cautionary
statements set forth below:

- Our limited operating history makes evaluation of our business and
prospects difficult;

- Our business and prospects must be considered in light of the risks,
uncertainties, expenses and difficulties frequently encountered by
companies in their early stages of development, particularly companies in
new and rapidly evolving markets, such as the market for location
services;

- Our sales cycles are long and our revenue is unpredictable;

- Our ability to secure additional financing on acceptable terms, as and
when necessary may be limited;

- Our ability improve our technology to keep up with customer demand for new
services may be limited;

- The development cycle for new products may be significantly longer than
expected, resulting in higher than anticipated development costs;

- Our systems and operations may be required to connect and manage a
substantially larger number of customers while maintaining adequate
performance, which could place a strain on managerial and operational
resources;

- Our ability to expand customer service, billing and other related support
systems may be limited;

- Our ability to retain the services of our key management and to attract
new members of our management team may be limited;

- Our ability to effect and retain appropriate patent, copyright and
trademark protection of our products may be limited;

- Despite the implementation of security measures, our computer networks and
web sites may be vulnerable to unauthorized access, computer viruses and
other disruptive problems, and any such occurrence could result in the
expenditure of additional resources necessary to protect our assets;

- We may be susceptible to increased competition in the field of location
services;

- We may not have the ability to retire the outstanding convertible notes
held by Castle Creek Technology Partners, LLC, pursuant to the terms of
the Note Purchase, Modification and Forebearance Agreement, dated as of
July 25, 2001, as amended as of September 26, 2001.

- Our ability to continue to meet the listing requirements of the Nasdaq
National Market.

We undertake no obligation to update publicly or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
In light of these risks, uncertainties and assumptions, the forward-looking
events contained or incorporated by reference in this Prospectus might not
occur.
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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 are not making 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, as well as information we
previously filed with the SEC, is accurate as of the date on the front cover of
this Prospectus only. Our business, financial condition, results of operations
and prospects may have changed since that date.

WHERE YOU CAN FIND MORE INFORMATION ABOUT US

We file reports, proxy statements and other information with the Securities
and Exchange Commission (the "SEC") (our SEC file number is 000-25205). Our SEC
filings are also available over the Internet at the SEC's website at
http://www.sec.gov. You may also read and copy any document we file at the
public reference facilities maintained by the SEC at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for
more information on the Public Reference Room and their copy charges. We
maintain a website at http://www.cellpoint.com.

IN CONNECTION WITH THIS OFFERING, CERTAIN SELLING STOCKHOLDERS MAY ENGAGE IN
PASSIVE MARKET MAKING TRANSACTIONS IN THE COMMON STOCK OF THE COMPANY ON NASDAQ
IN ACCORDANCE WITH RULE 103 OF REGULATION M. SEE "PLAN OF DISTRIBUTION".

INCORPORATION OF INFORMATION WE FILE WITH THE SEC

The SEC allows us to "incorporate by reference" the information we file with
it, which means:

- Incorporated documents are considered part of this prospectus;

- We can disclose important information to you by referring you to those
documents; and

- Information that we file with the SEC will automatically update and
supersede this prospectus.

We incorporate by reference the documents listed below that have been
previously filed with the SEC under the Exchange Act:

- Annual Report on Form 10-KSB for the fiscal year ended June 30, 2001, as
amended;

- Description of our Common Stock set forth in our Registration Statement on
Form 10SB, as amended, including any subsequent amendment or report filed
for the purpose of updating such description.

We also incorporate by reference each of the following documents that we
will file with the SEC after the date of this prospectus but before all the
common stock offered by this prospectus has been sold:

- Reports filed under Sections 13(a) and (c) and 15(d) of the Exchange Act;
and

- Definitive proxy or information statements filed under Section 14 of the
Exchange Act in connection with any subsequent stockholders' meeting.

You may request a copy of any filings referred to above, at no cost, by
contacting us at the following address:

CellPoint Inc.
3000 Hillswood Drive
Hillswood Business Park
Chertsey, Surrey KT16 0RS
England
Attn: Investor Relations

SUMMARY INFORMATION

THE FOLLOWING SUMMARY CONTAINS BASIC INFORMATION ABOUT OUR BUSINESS AND THIS
OFFERING. IT MAY NOT CONTAIN ALL THE INFORMATION THAT IS IMPORTANT TO YOU. YOU
SHOULD READ THIS ENTIRE PROSPECTUS, INCLUDING "RISK FACTORS" AND OUR
CONSOLIDATED FINANCIAL STATEMENTS AND RELATED NOTES INCORPORATED BY REFERENCE
INTO THIS PROSPECTUS, BEFORE DECIDING TO INVEST IN SHARES OF COMMON STOCK.

OUR BUSINESS

We focus on the worldwide development, marketing, distribution, sales,
implementation and support of mobile location software technology and platforms
for digital cellular networks. Our positioning technology, location services
platform and the applications of the technology are collectively marketed under
the name the "CellPoint System" and CellPoint Mobile Location System ("MLS").
Our applications are marketed under the names "Resource Manager", "Finder!" and,
"iMate" in addition to a variety of partner applications.

The CellPoint System enables users to determine the position of a cellular
telephone or mobile device, such as a Personal Digital Assistant (PDA), for use
in a broad range of consumer and business applications. The primary location
service application areas today include resource management of mobile workforce
personnel, friend finding relative to one's own location, personal security
services, information and entertainment services. In the resource and fleet
management application, companies can view and track their mobile service
personnel over the Internet. Information and entertainment services include
location-sensitive traffic reports, weather, and concierge information services
such as the location of the nearest hotel, cinema, restaurant, bank machine or
repair shop. Emergency applications could include locating persons making
emergency calls, roadside assistance in the event of vehicle breakdown or
location of a disabled or impaired person who may be lost or missing. Friend-
finding allows users to maintain buddy lists and view the location of
pre-defined, consenting individuals relative to their own location, send
messages to these people or call them. Personal security services offer added
security to people in higher risk occupations such as night security guards,
chauffeurs, tax collectors, health care personnel, postal delivery persons and
couriers.

We were originally organized on February 28, 1997, as Technor
International, Inc., a corporation organized under the laws of the State of
Nevada, pursuant to the provisions of General Corporation Law of the State of
Nevada. On October 4, 1999, we changed our corporate name to "CellPoint Inc." in
order to generate wider name recognition in the business and financial
communities. Our Common Stock trades on the NASDAQ National Market under the
symbol CLPT. As used herein, "we", "us", "our", "the Company" and "CellPoint"
refer to CellPoint Inc. and its subsidiaries

OUR ADDRESS

Our principal business address and telephone numbers are Kronborgsgrand 7,
164 46 Kista, Sweden, telephone +46 (0)8 633 2700, facsimile +46 (0)8 35 87 90.
We also maintain executive offices at 3000 Hillswood Drive, Hillswood Business
Park, Chertsey, Surrey, KT16 0RS, England, telephone +44 1932 895 310. The
Company maintains a website at www.cellpoint.com. Information contained in our
website is not a part of this Prospectus.

RECENT DEVELOPMENTS

FRAME AGREEMENT WITH KPN MOBILE N.V. On July 3, 2001, we announced the
frame agreement for a group license of our Mobile Location System for operators
within the KPN-Group. The contract covers the German operator E-Plus Mobilfunk
GmbH & Co. KG and has an option for all operators in the KPN Mobile N.V. group.

CASTLE CREEK NOTES RESTRUCTURING. On July 25, 2001, the Company and Castle
Creek Technology Partners, L.L.P. ("Castle Creek") entered into a Note Purchase,
Modification and Forebearance Agreement (the "July Agreement"), pursuant to
which the Company agreed to purchase over 90 days for 86% of face value of the
then remaining $9.25 million principal amount in convertible notes held by
Castle Creek. We agreed to pay $3.0 million to Castle Creek by September 24,
2001 and $4.955 million by October 23, 2001 (of which $1.0 million was paid as a
non-refundable deposit on July 25, 2001), plus all accrued and unpaid interest
from the original issuance date through October 23, 2001 or, if earlier, the
date of the purchase. As part of the transaction, the Company issued to Castle
Creek five-year warrants to purchase 500,000 shares of Common Stock, exercisable
after one year, at an initial exercise price of $3.14 per share (subject to
specified anti-dilution adjustment as set forth in the terms of such warrants).
The shares issuable upon exercise of such warrant are to be registered with the
Securities and Exchange Commission.

In addition, we granted to Castle Creek a security interest in our assets
(including the assets of our subsidiaries), including our intellectual property.
The fixed conversion price of the notes was changed to $4.00 with no floating
conversion price if the notes were purchased on a timely basis and we were in
compliance with all our other obligations to Castle Creek in all material
respects. We also agreed to certain limitations on the terms of future debt and
equity financings, which limitations would not apply to a financing that
provided the proceeds for the final purchase of the Notes. We granted Castle
Creek a full release of all claims and agreed not to disparage Castle Creek;
Castle Creek has agreed not to disparage the Company.

On September 26, 2001, CellPoint and Castle Creek entered into an amendment
of the July Agreement to repurchase the convertible notes held by Castle Creek
and related maters. Pursuant to the amendment, we paid $2.25 million to Castle
Creek on September 26, 2001 for principal and accrued interest. The remaining
outstanding convertible notes will be repaid at 100% and are subject to a fixed
conversion price of $4.00, and are scheduled to be repurchased on October 1,
2002 for approximately $6.1 million plus accrued interest (and, in the event of
a material breach by the Company, such prices will be then subject to specified
adjustments by a reset of the fixed conversion price to the lower of (a) the
average closing price during the ten-day period beginning five days prior to the
date of such non-compliance event, or (b) the lowest price at which our Common
Stock or Common Stock equivalents are sold after September 25, 2001, and by the
payment of an additional repurchase amount of $2,000,000). The outstanding notes
are prepayable in part or in whole at any time, without penalty. The July
Agreement, except as modified by the amendment, remains in effect.

ADDITIONAL FINANCINGS. In September 2001, we closed a private placement for
$3.25 million, pursuant to which we issued 3,250,000 shares of Common Stock plus
1,625,000 warrants to purchase shares of Common Stock at an exercise price of
$2.25 per share, exercisable for two years. The units were sold to accredited
investors pursuant to Regulation 506 under the Securities Act of 1933, as
amended (the "Securities Act"). The proceeds from the sale of these units were
used to repurchase a portion of the convertible notes held by Castle Creek.

In September 2001, we also completed an offering pursuant to Regulation S
under the Securities Act, in which non-U.S. Persons (as such term is defined in
Regulation S), purchased 1,568,144 shares of Common Stock and 784,071 warrants
to purchase shares of Common Stock, exercisable at $2.36 per share for two
years. The proceeds from the Regulation S offering aggregated $2,071,130, and
are being used for working capital.

In October 2001, we completed the initial closing of a private placement of
shares of Common Stock and warrants to purchase Common Stock for $1,300,000; the
offering will continue through November 2001 and any additional shares of Common
Stock will be registered in an amount equal to any additional shares and
warrants sold. We made such offering to accredited investors pursuant to
Regulation 506 under the Securities Act. In connection with such offering, we
issued 1,238,096 shares

of Common Stock, and 619,048 warrants to purchase shares of Common Stock, half
of which are exercisable at $3.50 per share for twelve months and the other half
of which are exercisable at $5.00 per share for twenty-four months.

MICRONET. On October 19, 2001, through our Swedish subsidiary, we purchased
the remaining 42% of Micronet Mobile Location Services AB ("Micronet"), a
company of which we already owned 58%. Consideration for such purchase was
US$141,427 which was paid to Micronet AB, the holder of the remaining stake in
Micronet, through our issuance of an aggregate of 107,142 shares of Common
Stock, and two-year warrants to purchase 53,571 shares of Common Stock at an
exercise price of $2.50 per share. Such shares are included in this Prospectus.

DISCONTINUED OPERATIONS. On February 29, 2000, we acquired all of the
capital stock of Unwire AB. Unwire develops systems and equipment for GSM
positioning and telematics. We paid the purchase price by issuing to the
stockholders of Unwire an aggregate of 1,075,000 shares of Common Stock with a
market value of approximately $70.7 million. In the fourth quarter of Fiscal
2001, our Board of Directors determined that the investment required to operate
the telematics business segment did not fit in with our longer-term strategic
goals. We intend to concentrate all of our efforts and resources in developing
and promoting location-based services. We have been unable to identify a
purchaser for Unwire.

On October 9, 2001, Unwire, filed for bankruptcy in Sweden. As a result of
the filing, we have effectively ceased all funding of Unwire operations. The
bankruptcy courts have appointed a trustee to oversee the disbursement of
Unwire's assets and we have effectively lost control of our management and
decision making capabilities over Unwire operations.

We anticipate that CellPoint Systems SA ("Systems SA"), our South African
subsidiary, will also file for bankruptcy protection in South Africa. Systems SA
operated a research and development facility for the Company. For financial
reporting purposes, the telematics portion of Systems SA was already included as
part of the discontinued operations reported in our Form 10-KSB, as amended, for
our fiscal year ended June 30, 2001. The location services portion of Systems SA
was not included in discontinued operations, as those functions will continue to
be performed by our Swedish subsidiary. Costs of closing this subsidiary,
primarily the write-off of the net receivable from Systems SA, have been accrued
in the June 30, 2001 financial statements. The assets, liabilities and results
of operations of Systems SA were immaterial to the financial statements of the
Company for all periods presented.

THE OFFERING

The Shares offered pursuant to this Prospectus are shares of our Common
Stock beneficially owned by the Selling Stockholders. We will not receive any
proceeds from the sale of the Shares by the Selling Stockholders, except to the
extent that any of the Selling Stockholders exercise their warrants and elect to
pay the exercise price in cash.

THE SELLING STOCKHOLDERS

This Prospectus relates to the registration of the resale of 10,384,540
shares of our Common Stock, beneficially owned by certain of our stockholders
(the "Selling Stockholders"). The shares covered by this Prospectus are being
registered for resale by the Selling Stockholders as follows:

- 4,875,000 shares are being registered for sale by purchasers of Common
Stock and warrants to purchase Common Stock in a private placement under
Regulation D, which closed in September 2001;

- 2,352,215 shares are being registered for sale by purchasers Common Stock
and warrants to purchase Common Stock in a Regulation S offering, which
closed in September 2001;

- 1,857,144 shares are being registered for sale by purchasers Common Stock
and warrants to purchase Common Stock in a private placement under
Regulation D, which closed in October 2001;

- 67,451 shares are being registered for sale upon the exercise of warrants
issued pursuant to Section 4(2) of the Securities Act;

- 86,207 shares are being registered for sale by purchasers of Common Stock
in a private sale under Section 4(2) of the Securities Act;

- 985,810 shares are being registered for sale upon conversion of notes and
upon the exercise of the warrants held by Castle Creek; and

- 160,713 shares are being registered for sale by Micronet AB.

We do not know whether the Selling Stockholders will sell any of the Shares
or when or if the Selling Stockholders will exercise their warrants. See "The
Selling Stockholders" and "Plan of Distribution".

RISK FACTORS

THIS OFFERING INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD CAREFULLY CONSIDER
THE RISKS DESCRIBED BELOW BEFORE YOU DECIDE TO BUY OUR SHARES. IF ANY OF THE
FOLLOWING RISKS ACTUALLY OCCUR, OUR BUSINESS, RESULTS OF OPERATIONS AND
FINANCIAL CONDITION WOULD BE LIKELY TO SUFFER. IN THAT CASE, THE MARKET PRICE OF
OUR COMMON STOCK COULD DECLINE, AND YOU COULD LOSE ALL OR PART OF YOUR
INVESTMENT.

RISKS RELATED TO OUR BUSINESS

OUR LIMITED OPERATING HISTORY MAKES EVALUATION OF OUR BUSINESS AND PROSPECTS
DIFFICULT.

We have only a limited operating history on which prospective investors can
base an evaluation of our business and prospects. While we have generated
limited revenues since July 1999 and substantially increased our revenues during
the current fiscal year, we cannot assure prospective investors that we will
generate sufficient revenues to fund our operations or that we will be
profitable at such level of operations. Our business and prospects must be
considered in light of the risks, uncertainties, expenses and difficulties
frequently encountered by companies in their early stages of development,
particularly companies in new and rapidly evolving markets, such as the market
for location services.

WE HAVE A HISTORY OF LOSSES AND WE ANTICIPATE SIGNIFICANT FUTURE LOSSES.

For the year ended June 30, 2001 ("Fiscal 2001"), our gross revenues from
continuing operations increased almost five-fold to $4,111,804, as compared to
revenues from continuing operations of $839,003 for the fiscal year ended
June 30, 2000 ("Fiscal 2000"). Virtually all of the Company's revenues came from
the European market.

Loss from continuing operations for Fiscal 2001 was ($16,501,365) versus
($8,164,617) in Fiscal 2000. The loss from continuing operations was larger in
Fiscal 2001 because the Company greatly expanded its infrastructure, increased
the number of its full-time employees and increased its marketing and selling
expenses as the Company sought to commercialize its products and obtain
contracts for the sale of its services and products. The Company believes that
as a result of the economic downturn in the second half of last year, generally,
and in the telecom sector, anticipated orders from network operators may have
been delayed.

On July 25, 2001, the Company announced its intention to sell its telematics
division. On October 9, 2001, Unwire, our telematics subsidiary, filed for
bankruptcy protection under the laws of Sweden. Under United States generally
accepted accounting principles, the results of operations for the telematics
division are presented under "Loss from Discontinued Operation" for both Fiscal
2001 and Fiscal 2000. A write off of intangible assets within Unwire resulted in
a loss of $52,258,545 attributed to the disposal of "discontinued operations" in
Fiscal 2001. The intangible assets were valued initially based on the Company's
stock price when Unwire was acquired in February 2000 for 1,075,000 shares and
no cash. The majority of the loss on disposal of the "discontinued operations"
results from a write-down of these intangibles to their expected net realizable
value. The loss from "discontinued operations" of $10,876,197 represents the
operating losses of the telematics division for the fiscal year through May 19,
2001, the date of the Board approval for the sale of Unwire. This amount
includes depreciation and amortization of $8,067,016.

Net loss was ($79,636,107) for Fiscal 2001, a majority of which was
attributable to the loss on disposal of and loss from discontinued operations of
($52,258,545) and ($10,876,197), respectively. Loss per share from continuing
operations was ($1.57), loss per share from discontinued operations was ($5.99)
and net loss per share was ($7.56), based on weighted average shares outstanding
of 10,532,913, while the Fiscal 2000 loss per share from continuing operations
was ($0.93), loss per share from discontinued operations was ($0.42) and the net
loss per share was ($1.35)based upon a weighted

average of 8,743,630 shares outstanding. The net loss for Fiscal 2000 was
($11,831,260) including the loss from discontinued operations of ($3,666,643).

WE ARE LIKELY TO NEED ADDITIONAL FINANCING IN THE NEXT TWELVE MONTHS.

We are likely to need additional financing for our future capital needs,
which may not be available on favorable terms, if at all. If we are unable to
secure sufficient additional financing, we may be forced to suspend our business
strategy and/or curtail our operations.

We may raise such additional capital through additional public or private
financings, as well as borrowings and other resources. To the extent that
additional capital is raised through the sale of equity or equity-related
securities, the issuance of such securities could result in dilution to our
stockholders. We cannot be assured that we will have access to the capital
markets in the future, or that financing will be available to us on acceptable
terms to satisfy our cash requirements. If we cannot obtain the necessary
capital, our business and financial condition will be materially adversely
affected.

Under the MarketPlace Rules of the NASDAQ, if we propose to issue (including
shares issuable upon exercise of the Warrants) a number of shares in excess of
20% of our outstanding Common Stock and the offering price is less than the
market value of our Common Stock as traded on NASDAQ, we are required to obtain
prior stockholder approval of such offering. If we are unable to obtain such
stockholder approval and are unable to complete the necessary financings, our
financial condition will be materially adversely affected.

WE MAY NOT BE ABLE TO REPURCHASE ALL OF THE OUTSTANDING CONVERTIBLE NOTES HELD
BY CASTLE CREEK.

We have an obligation to repurchase the outstanding $6,105,100 of our
convertible notes held by Castle Creek by October 1, 2002. However, if we are
not in compliance in all material respects with our obligations under the
restructured notes, we will be charged a $2,000,000 penalty and the notes will
become convertible at the lower of (a) the lowest price of common stock or
common stock equivalents sold from September 25, 2001 to the non-compliance
event or (b) the average closing price during the ten day period beginning five
days prior to the date of the non-compliance event. If we are unable to purchase
such notes by that date, we will be in default under our obligations, and the
Company's financial condition will be materially adversely affected. Castle
Creek has a security interest in all of our assets. In the event of a material
non-compliance event Castle Creek may have the right to foreclose on such
security interests. See "Summary Information--Recent Developments".

WE DEPEND HEAVILY ON OUR KEY PERSONNEL, AND OUR INABILITY TO RETAIN THEM COULD
MATERIALLY ADVERSELY AFFECT OUR BUSINESS.

Our success will depend, in part, on the continued availability of our
senior management team, particularly Peter Henricsson, President and Chief
Executive Officer, Lynn Duplessis, Executive Vice President, Lars Persson, Chief
Executive Officer of CellPoint Europe Limited, and Lars Wadell, Chief Financial
Officer. We have employment agreements with each of these executive officers.
Mr. Henricsson and Ms. Duplessis are husband and wife. The loss of any of these
key employees could have a material adverse effect on our future business and
prospects. We believe that all commercially reasonable efforts have been made to
minimize the risks that might arise should any of our key personnel depart from
the Company. We do not maintain any key man life insurance with respect to any
of our executive employees.

AN INVESTMENT IN THE COMPANY MUST BE CONSIDERED SPECULATIVE.

We cannot assure prospective investors that they will realize a return on
their investment or that our stockholders will not lose their investments in the
Company in their entirety. In the event we are forced to dissolve or commence
insolvency proceedings, any proceeds from the liquidation of our assets

will be distributed to our stockholders only after the satisfaction of the
claims of our creditors. An investor's ability to recover all or any portion of
an investment in our capital stock will depend upon the amount of the
dissolution proceeds.

WE HAVE NOT PAID ANY DIVIDENDS ON OUR COMMON STOCK AND DO NOT ANTICIPATE PAYING
ANY DIVIDENDS IN THE FORESEEABLE FUTURE.

We have not paid any dividends on our Common Stock. For the foreseeable
future, we anticipate that all earnings, if any, that may be generated from our
operations will be used to finance the growth of the Company and that cash
dividends will not be paid to holders of the Common Stock.

OUR STOCK PRICE MAY BE VOLATILE.

The trading price of our Common Stock is likely to be highly volatile and
could be subject to wide fluctuations for reasons including; (i) thin trading
volume; (ii) variations in quarterly operating results; (iii) technological
innovations; (iv) new sales formats, services by the Company or its competitors;
(v) forecasts by securities analysts; (vi) market conditions; (vii) market
valuations of other new technology and Internet companies; (viii) significant
acquisitions, strategic partnerships, joint ventures, capital commitments by the
Company or its competitors; (ix) changes in key personnel, and other events or
factors beyond the Company's control. In addition, the market for
Internet-related and technology companies has experienced extreme price and
volume fluctuations often unrelated or disproportionate to the operating
performance of such companies. These broad market and industry factors may
materially adversely affect the market price of the Common Stock, regardless of
our operating performance.

TO THE EXTENT THAT OUTSTANDING WARRANTS AND OPTIONS ARE EXERCISED, THERE WILL BE
AN INCREASE IN THE NUMBER OF SHARES OF OUR COMMON STOCK WHICH MAY HAVE AN
ADVERSE EFFECT ON OUR STOCK PRICE.

As of October 19, 2001, we had outstanding an aggregate of 4,054,626
warrants, with exercise prices ranging from $1.32 to $11.40. The shares issuable
pursuant to 3,749,141 warrants are included in this Prospectus; the shares
issuable pursuant to the remaining warrants were previously registered with the
SEC. In addition, there are 803,100 options outstanding under our Stock
Incentive Plan and 518,800 warrants outstanding under our Stock Warrant Plan.
These warrants have anti-dilution adjustments as set forth in the terms of the
warrants. The exercise of these warrants and options, in part or in full, will
significantly increase the number of shares of our Common Stock in the public
float, and may, as a consequence, have an adverse effect on the price of our
Common Stock.

WE MAY NOT BE ABLE TO MANAGE OUR EXPANDING OPERATIONS EFFECTIVELY.

We are currently experiencing a period of rapid expansion. Due to the
limited deployment of our services to date, the ability of our systems and
operations to connect and manage a substantially larger number of customers
while maintaining adequate performance is unproven. In addition, rapid growth is
likely to place a strain on managerial and operational resources. To accommodate
this growth, we must accomplish the following:

- implement new or upgraded operating and financial systems, procedures and
controls in many different locations;

- expand customer service, billing and other related support systems;

- devise and implement new advertising and marketing campaigns focused on
the CellPoint brand and certain of new products and services; and

- obtain sufficient resources or additional capacity from network operators.

We may not succeed with these efforts. Our failure to accomplish these goals
in an efficient manner could cause expenses to grow and revenues to decline or
grow more slowly than expected, and could otherwise have a material adverse
effect on our business, financial condition and results of operations.

THE DEVELOPMENT CYCLE FOR NEW PRODUCTS MAY BE SIGNIFICANTLY LARGER THAN EXPECTED
RESULTING IN HIGHER THAN ANTICIPATED DEVELOPMENT COSTS.

The development cycle for our new products may be significantly longer than
expected, resulting in higher than anticipated development costs. The complexity
of our technology, development difficulties or a shortage of qualified personnel
may result in delays to our introduction of new products or services and product
or service enhancements. We cannot assure you that (i) we will be able to
counter challenges to our current products or services; (ii) our future product
and service offerings will keep pace with technological changes implemented by
competitors; (iii) our products and services will satisfy evolving preferences
of customers and prospects; or (iv) we will be successful in developing and
marketing products and services in a timely fashion. Failure to develop and
introduce new products and product enhancements in a timely fashion could have a
material adverse effect on our business, prospects, financial condition and
results of operations.

WE HAVE NOT YET ACHIEVED FULL MARKET ACCEPTANCE OF OUR PRODUCTS.

We are currently implementing commercial operations of the CellPoint System
for mobile location technology and services. We have commercial agreements in
operation in Sweden (Tele2), France (France Telecom), Czech Republic (EuroTel)
and Germany (E-Plus). Though we are marketing the CellPoint System throughout
Europe, Asia and North America, we cannot assure prospective investors that we
will be successful in procuring additional contracts, or that the contracts
obtained will be profitable. We also cooperate with numerous technology and
telecommunications industry suppliers including application developers and
systems integrators. We are seeking additional strategic alliances for
distribution and marketing channels to sell the mobile location services to
mobile operators and large end-users respectively. We cannot assure prospective
investors that the CellPoint System will achieve significant degrees of market
acceptance, and that acceptance, if achieved, will be sustained for any
significant period or that product life cycles will be sufficient (or substitute
products developed) to permit the Company to recover start-up and other
associated costs. Failure of the CellPoint System to achieve or sustain market
acceptance could have a material adverse effect on our future business, future
financial conditions, and future results of operations.

OUR SALES CYCLES ARE LONG AND OUR REVENUE IS UNPREDICTABLE.

CellPoint's products and services are complex and it typically takes a
cellular network operator a significant amount of time to reach a decision to
purchase them. We may spend a significant amount of time, effort and expense
during a particular period that does not yield any orders during that period or
at all. If orders or payments are delayed, then it may be difficult to meet cash
flow requirements or obtain credit. Furthermore, deployment of location services
by a network operator may take several months and manufacturing delays of our
WAS can delay installation. A delay in sales of our products could cause
operating results to vary significantly from projected results. The sales of
services by the network operators will depend on how quickly the network
operator is able to roll-out mobile location services. Since we have no control
over the purchase decision or the timing of the roll-out and since we have
limited revenue history, it is particularly difficult to predict future revenue
and operating results. If the timing and magnitude of future sales are not
accurately predicted, then it may be difficult to meet customers' delivery
requirements. These problems could impede our growth, restrict our ability to
take advantage of new opportunities, and ultimately have a material adverse
effect on our financial condition.

WE MAY HAVE DIFFICULTY IDENTIFYING AND FINANCING SUITABLE ACQUISITIONS, JOINT
VENTURES OR STRATEGIC ALLIANCES, AND THOSE THAT WE DO COMPLETE COULD ADVERSELY
AFFECT OPERATING RESULTS.

As part of our business strategy, senior management reviews potential
acquisitions, joint ventures and strategic alliances that may complement or
expand existing business or increase revenues. We may not be able to identify
appropriate joint ventures, acquisitions or alliances or be able to finance
these transactions successfully once identified. Any failure to identify or
finance future transactions may impede our growth.

Any acquisitions that are completed will be accompanied by the risks
commonly encountered with acquisitions of companies, such as the difficulty of
integrating the operations and personnel of the acquired businesses, the
potential disruption of our business, the assumption of unexpected liabilities
relating to the acquired assets, the imposition and maintenance of common
standards, controls, procedures and policies and the impairment of relationships
with employees and customers as a result of difficulties arising out of
integration. Furthermore, the value of any business acquired may be less than
the amount paid for it if, for example, there is a decline in the position of
that business in the relevant market in which it operates or there is a decline
in that market generally.

WE MAY ENCOUNTER DIFFICULTIES IN IMPLEMENTING OUR BUSINESS STRATEGY.

Although we intend to pursue a strategy of aggressive product marketing,
development and distribution, implementation of this strategy will depend in
large part on our ability to (i) establish a significant customer base and
maintain favorable relationships with those customers, (ii) effectively
introduce acceptable products to our customers, (iii) obtain adequate financing
on favorable terms to fund our business strategy, (iv) maintain appropriate
procedures, policies, and systems, (v) hire, train, and retain skilled
employees, and (vi) continue to operate in the face of increasing competition.
If we are unable to achieve any or all of these goals, we will not be able to
successfully implement our business strategy, which could have a material
adverse effect on our results of operations and financial condition.

THE PERFORMANCE OF OUR PRODUCTS COULD RESULT IN PRODUCT LIABILITY FOR OUR
BUSINESS OR PRODUCT RECALLS.

We are responsible for product performance and liabilities of our products
based on our core technology. We currently have $1.5 million of product
liability insurance, but there can be no assurance that we will be able to
obtain additional insurance or maintain such insurance on acceptable terms that
such insurance will provide adequate coverage against potential liabilities. We
face a business risk of exposure to product liability, claims for consequential
damages and other claims in the event that the use of our technology and
services or the failure of our technology to perform in accordance with
specifications is alleged to result in material adverse effects. We cannot
assure prospective investors that we will avoid significant product liability
exposure or that insurance coverage will be available in the future on
commercially reasonable terms, or at all. A loss of insurance coverage or the
assertion of a product liability claim or claims would likely materially
adversely affect our business, financial condition and results of operations.
While we have taken, and will continue to take, what we believe are appropriate
precautions, there can be no assurance that we will avoid significant liability
exposure. An inability to obtain product liability insurance at acceptable cost
or to otherwise protect against potential product liability claims could prevent
or inhibit the marketing and distribution of the CellPoint System.

WE MAY BE UNABLE TO ADEQUATELY PROTECT OUR INTELLECTUAL PROPERTY RIGHTS AND MAY
BE SUBJECT TO CLAIMS ALLEGING INFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS
OF OTHERS.

We cannot be certain that the steps we have taken to protect our
intellectual property rights will be adequate to deter misappropriation of
proprietary information or prevent others from independently

developing or offering similar products or services. Given the global reach of
mobile communications, trademarks and other forms of intellectual property could
be displayed in countries that offer less intellectual property protection than
the United States, Sweden, South Africa and the United Kingdom. Furthermore,
although we have and expect to have confidentiality and non-competition
agreements with our employees, suppliers and manufacturers, no assurances can be
made that such arrangements will be adequate to protect our trade secrets and
intellectual property rights.

We are not aware of any infringement by our technology on the proprietary
rights of others and have not received any notice of claimed infringement.
However, we have not conducted any investigation as to possible infringement. In
addition, we cannot be sure that a third party will not assert an infringement
claim in the future, or if asserted, that we will be able to successfully defend
against any such claim. Any such misappropriation or claim could have a material
adverse effect on our future financial results and/or our ability to operate the
business.

OUR COMPUTER SYSTEMS MAY BE SUBJECT TO DISRUPTION.

Despite the implementation of security measures, our computer networks and
web sites may be vulnerable to unauthorized access, computer viruses and other
disruptive problems. A party who is able to circumvent security measures could
misappropriate proprietary information or cause interruptions in our Internet
operations. Significant capital and other resources to protect against the
threat of security breaches or to alleviate problems caused by such breaches may
have to be expended. There can be no assurance that such security measures
implemented by the Company will not be circumvented causing viruses,
interruptions, delays or a cessation of service to users which could have a
material adverse effect on our business, prospects, results of operations and
financial condition.

RISKS RELATED TO OUR INDUSTRY

E-COMMERCE BUSINESSES ARE SUBJECT TO SIGNIFICANT UNCERTAINTIES.

Use of the Internet by consumers is in a relatively early state, and market
acceptance of the Internet as a medium for telephone service is subject to
uncertainty. The rapid growth of global commerce and the exchange of information
on the Internet and other online networks is relatively new and still evolving,
making it difficult to predict whether the Internet will prove to be a viable
commercial marketplace generally. The Company believes that its future success
will depend on its ability to significantly increase revenues, which, in turn,
will be materially dependent upon the development and widespread acceptance of
the mobile devices as a means to access the Internet and online services. The
Internet may not prove to be a viable commercial marketplace because of
inadequate development of the necessary infrastructure, such as reliable network
backbones, or complementary services, such as high-speed modems and security
procedures. The Internet has experienced, and is expected to continue to
experience, significant growth in the number of users and amount of traffic.
There can be no assurance that the Internet infrastructure will continue to be
able to support the demands placed on it by sustained growth. In addition, the
viability of the Internet may prove uncertain due to delays in the development
and adoption of new standards and protocols, the inability to handle increased
levels of Internet activity or due to increased government regulation. If use of
the Internet does not continue to grow, or if the necessary Internet
infrastructure or complementary services are not developed to effectively
support growth that may occur, the Company's business, results of operations and
financial condition would be materially adversely affected. New laws and
regulations that impact our industry could increase costs or reduce
opportunities to earn revenue.

We are currently subject to certain regulations specifically aimed at
e-commerce and Internet-related services in addition to regulations applicable
to businesses in general. In the future, however, we may become subject to
additional regulation by local or national regulatory authorities including,
among other issues, e-commerce and taxation. Concerns about personal privacy
could also result in regulations limiting the use of mobile location services.
For example, the European Union (the "EU") has issued a revised
telecommunications data protection directive that covers advanced location
systems such as the CellPoint System. The revised directive provides that
location data may only be used with the consent of the subscriber and that
subscribers and users must be provided with a simple means of temporarily
denying the processing of their location data. The revised directive, which is
not expected to take effect in the EU until 2002, may affect the extent to which
network operators are able to use the CellPoint System. If the use of the
CellPoint System by network operators is significantly curtailed, we expect a
significant adverse impact in our ability to generate revenue.

In addition to regulations covering CellPoint, the network operators that
supply us with capacity are subject to laws and regulations that could cause
them to increase our costs or reduce our ability to continue selling and
supporting our services.

IF WE DO NOT RESPOND EFFECTIVELY AND ON A TIMELY BASIS TO RAPID TECHNOLOGICAL
CHANGES AND CHANGES IN CUSTOMER NEEDS, WE MAY LOSE SALES.

The wireless industry is characterized by rapidly changing technologies,
industry standards, customer needs and competition, as well as frequent new
product and service introductions. We will need to maintain technological
competitiveness, achieve market acceptance and meet an expanding range of
customer requirements in order to attract and retain customers and manage
customer data effectively.

Our services are integrated with mobile devices and must also be compatible
with the networks of mobile network operators. We may not be successful in
developing and marketing, on a timely and cost-effective basis, new services
that respond to technological changes, evolving industry standards including
GPRS and UMTS, or changing customer requirements. Our ability to grow and
achieve profitability will depend, in part, on our ability to accomplish the
following in a timely and cost-effective manner:

- effectively use and integrate new mobile technologies;

- continue to develop and maintain technical expertise;

- develop applications to adapt to new mobile systems and personal devices;

- influence and respond to emerging industry standards and other industry
developments;

- effectively market our services; and

- develop innovative services that continue to satisfy the needs of our
customers.

We cannot assure prospective investors that we will be able to achieve these
goals and our failure to do so could have a material adverse effect on our
future financial results and/or ability to operate the business.

THERE IS NO ESTABLISHED MARKET FOR LOCATION SERVICES.

The success of our business depends heavily on the development of a market
for mobile location products and services. Since this market is new, and its
potential is uncertain, there can be no assurances that it will develop or be
sustained for a period sufficient to recover start-up and other associated
costs. In order to be successful, we need mobile network operators to launch and
maintain mobile location services utilizing our location services platform and
location applications. Although we

intend to market our products aggressively, we cannot assure prospective
investors that network operators will accept our products or that consumers will
purchase mobile location services from their network operators. If significant
sales of location services do not develop, our future financial condition and
results of operations may suffer. Our success depends on establishing and
maintaining relationships with mobile network operators.

The primary source of our location services revenue is based on the volume
of subscribers using our services through a mobile network operator. Our success
depends heavily on the success of mobile network operators in pricing and
marketing new location services to their customers. If one or more network
operators are unable to gain location services subscribers, then our future
earnings may suffer. We also depend on mobile network operators to provide
uninterrupted service and we will not be able to satisfy our customers' needs if
the network operators fail to provide the required level of service, including
bandwidth. In addition, our expenses may increase and profitability could be
materially adversely affected if network operators were to increase the prices
of their services. Some network operators are, or could become, competitors and,
if they become competitors, they may refuse to provide their services to us or
only provide them to us on less advantageous terms. This could have a material
adverse effect on our future financial results and/or our ability to operate the
business.

OUR BUSINESS COULD SUFFER IF MOBILE DEVICES ARE NOT WIDELY ADOPTED FOR
INTERNET-BASED SERVICES.

The success of our business depends in part on the acceptance by the market
of mobile devices as a method of accessing the Internet. There are a number of
technological and market barriers to the widespread use of mobile devices for
this purpose. These barriers include limited display capability, difficulty of
data input, slower connection speeds, lack of acceptable security technologies,
concerns over privacy and inconsistent quality of service.

ACTUAL OR PERCEIVED HEALTH RISKS ASSOCIATED WITH THE USE OF MOBILE PHONES COULD
REDUCE THE NUMBER OF MOBILE USERS.

We are aware of recent concerns expressed that there may be risks associated
with the effects of electromagnetic signals from mobile handsets and
transmission masts, which serve as antennae for transmitting radio signals. The
actual or perceived health risk associated with mobile communications devices
and masts could adversely affect us through a reduction in the number of mobile
handset users or a reduction in the average usage per mobile subscriber.

COMPETITION COULD HARM OUR BUSINESS.

The markets for the location services offered by us are becoming
increasingly competitive. If we are unable to either respond adequately to the
competitive challenges we face or establish a sustainable competitive advantage,
we may lose market share or be forced to lower prices to unprofitable levels. In
addition, we have a number of existing and potential competitors, located in
various service categories, and may be unable to predict or plan adequately for
the strategies of competitors. Accordingly, we may be unable to respond quickly
or adequately to the changes in the marketplace brought on by new service
offerings and the marketing and promotional efforts of existing or new
competitors.

As many of our agreements with mobile network operators and industrial
customers are non-exclusive, competitors may use the same networks in
competition with us. It may be possible for competitors to develop technologies,
products and services that are more effective than our technologies, products
and services or that could render our technology, products and services obsolete
and non-competitive. Competitors could include mobile network operators,
software developers, systems integrators, media companies, telecommunications
manufacturers and Internet portals. Many potential competitors have
significantly greater financial, technical, marketing and other resources than
we have. No assurances can be made that existing competitors or other companies
will not provide

services that could be more attractive to consumers or companies than those
provided by us or that we will be able to respond adequately to the competitive
challenges we face.

WE ARE DEPENDENT ON INTERNATIONAL SALES, AND OUR BUSINESS IS SUBJECT TO THE
LOCAL BUSINESS RISKS IN EACH COUNTRY IN WHICH WE DO BUSINESS.

The majority of the revenue from the sale of our location services will be
derived from customers located outside of the United States. Our sales and
operations could be subject to certain risks of international trade, including
tariffs and other barriers, difficulties in staffing and managing foreign
subsidiary and branch operations, currency exchange risks and exchange controls,
potentially adverse tax consequences and the possibility of difficulty in
accounts receivable collection. Any of these factors could adversely affect our
business, financial condition and results of operations.

Our products may be subject to foreign government standards and regulations
that are continually being amended and may vary from country to country.
Although we will endeavor to satisfy foreign technical and regulatory standards,
there can be no assurance that the CellPoint System terminals will comply in all
respects with such government standards and regulations, or changes thereto, or
that it will be cost effective for us to redesign our products to comply with
such standards or regulations. Our inability to design or redesign products to
comply with foreign standards could have a material adverse effect on our
business, financial condition and results of operations.

FLUCTUATIONS IN THE VALUE OF FOREIGN CURRENCIES COULD RESULT IN CURRENCY
EXCHANGE LOSSES.

Our products and services are sold in currencies other than the U.S. Dollar,
which makes the management of currency fluctuations difficult and exposes us to
risks. Fluctuations in the value of foreign currencies relative to the U.S.
Dollar could cause us to incur currency exchange losses. The risk will increase
to the extent international revenue increases. The effect of exchange rate
fluctuations on future operating results cannot be predicted. We have no
experience in entering into currency hedging contracts, and if we use hedging to
try to manage any future foreign currency exposure, we may incur hedging-related
losses.

RISKS RELATED TO THIS OFFERING

OUR SHARES MAY EXPERIENCE EXTREME PRICE AND VOLUME FLUCTUATIONS.

The market price for our common stock may fluctuate significantly in
response to a variety of influences, including the following some of which are
beyond our control:

- variations in quarterly operating results;

- changes in financial estimates by securities analysts;

- changes in market valuation of our competitors or perceived competitors;

- changes in market valuation of companies in the telecommunications
industry;

- announcements by us of significant contracts, acquisitions, strategic
partnerships, joint ventures or capital commitments;

- additions or departures of key personnel;

- sales of Common Stock, including short sales, or termination of stock
transfer restrictions;

- exercise of outstanding warrants; and

- fluctuations in trading volume, which are particularly common among high
technology companies.

SALES OF SUBSTANTIAL AMOUNTS OF OUR COMMON STOCK IN THE PUBLIC MARKET COULD
REDUCE THE VALUE OF INVESTORS' INVESTMENT.

The sale of a substantial number of shares of our Common Stock in the public
market could cause a reduction in the market price of our Common Stock. In
addition, the stock market has, from time to time, experienced significant price
and volume fluctuations that have affected the market prices for securities
generally.

As a result of the limited trading market for our Common Stock, sales by our
stockholders of our Common Stock in the public market could materially adversely
affect the prevailing market price for our Common Stock and could impair our
ability to raise capital through offerings of our equity securities. Any such
sales could materially adversely affect the then-prevailing market price for our
Common Stock or the ability of our stockholders to sell their shares.

WE MAY NOT BE ABLE TO MAINTAIN OUR LISTING ON THE NASDAQ NATIONAL MARKET.

Our common stock is currently traded on the NASDAQ National Market and our
Swedish Depositary Receipts (evidencing shares of our Common Stock) are traded
on the Stockholm OM Exchange. Although we believe that we will continue to meet
the criteria necessary to maintain such listings, there can be no assurance that
we will be able to do so. To the extent that we do not maintain such listings,
our stockholders could find it more difficult to dispose of, or to obtain
accurate quotations as to the market value of, our Common Stock. In addition,
failure to maintain a listing for our Common Stock may constitute an event of
default under the outstanding convertible notes and may make our Common Stock
ineligible for use as, or make our Common Stock substantially less attractive
as, collateral for margin and purpose loans, for investment by financial
institutions under their internal policies or state legal investment laws, as
consideration in the financing of future acquisitions of businesses or assets by
us, and for issuance by us in future capital raising transactions.

WE MAY NOT HAVE SUFFICIENT AUTHORIZED BUT UNISSUED SHARES OF COMMON STOCK IF ALL
OF OUR OUTSTANDING DERIVATIVE SECURITIES ARE EXERCISED OR CONVERTED.

As of October 19, 2001, we had outstanding derivative securities, pursuant
to which an aggregate of 6,180,504 shares of our Common Stock may be issued. As
of such date, we had issued and outstanding 16,355,543 shares of Common Stock.
The Company's Articles of Incorporation only authorize 22,000,000 shares of
Common Stock. Accordingly, the Company does not have sufficient authorized but
unissued shares of Common Stock to enable the Company to allow the conversion of
all of the outstanding derivative securities and to allow the Company to raise
additional equity capital. On October 17, 2001, our Board of Directors approved
an amendment to our Articles of Incorporation increasing our authorized capital
stock to 50,000,000 shares of Common Stock and 10,000,000 shares of Preferred
Stock. This amendment is being submitted to our stockholders for approval at our
Annual Meeting scheduled for December 5, 2001. If such amendment is not
approved, then we may be in default under the terms of the outstanding
derivative securities. If we are declared to be in default under the notes held
by Castle Creek, then Castle Creek may have the right to foreclose on its
security interests in our assets.

CERTAIN ANTI-TAKEOVER PROVISIONS MAY PRODUCE RESULTS DISFAVORED BY OUR
STOCKHOLDERS.

Our Articles of Incorporation permit us, without further stockholder action,
to issue up to 3,000,000 shares of preferred stock, having such rights and
preferences as our Board of Directors may determine. In addition, our Articles
and Amended and Restated By-laws contain various provisions that, under certain
circumstances, could make it more difficult for a third party to gain control of
the Company (e.g., by means of a tender offer), prevent or substantially delay
such a change of control, discourage bids for our Common Stock at a premium, or
otherwise adversely affect the market price of our Common Stock.

USE OF PROCEEDS

We will not receive any proceeds from the sale of any of the Shares by the
Selling Stockholders. Some of the Shares included in this Prospectus have not
yet been issued, but are issuable upon the exercise of warrants held by certain
of the Selling Stockholders, which warrants have exercise prices ranging from
$1.32 to $5.00.

In connection with the exercise of such warrants, each warrant holder may
elect to pay the exercise price by (i) cash or check or (ii) net issuance; i.e.,
cashless exercise. To the extent that a warrant holder elects the net issuance
method, we would not receive any cash as a result of such exercise. To the
extent that all of the warrant holders pay the exercise price by cash or check,
we would receive an aggregate of $10,244,574. Additional proceeds, if any, that
we receive from the exercise of the warrants will be used for working capital.

BUSINESS

CONTINUING OPERATIONS

LOCATION SERVICES

INDUSTRY OVERVIEW

We believe that location services will play a key role in the mobile
Internet and mobile commerce, and that the location component will be a
cornerstone in the majority of mobile Internet use. There has been an explosive
growth of wireless communications and the Internet, with mobile telephony being
the fastest growing technology of all time. Mobile Internet access will offer
corporate and mass-market utility in saving time and money. Merrill Lynch
(Wireless Internet, June 5, 2000) projects 1.5 billion people will have wireless
access to the Internet by 2005. Most experts agree that more people will access
the Internet from mobile devices than from fixed computers before 2005.
Location-based services are projected to be worth US$38 billion in consumer
spending in 2005 and location services are projected to represent 9% of all
mobile operator revenues in Western Europe in 2005 (Interactive Entertainment:
Delivering Revenues in the Broadband Era, Schema, July 2001).

Mobile operators are facing increased competition, lower revenues per user
through falling prices and churn among subscribers from one operator to another.
Voice services alone have become a commodity service. The key to unlocking
further value in the operators' investments in network infrastructure is through
offering unique value-added services to attract more customers and more airtime
use per customer, improve subscriber loyalty and reduce churn of subscribers.
Services such as voice mail, pre-paid subscriptions and short message service
(SMS) are value-added service offerings beyond voice that have become
commonplace. Location services can offer operators new value-added services to
unlock new revenue potential and differentiate operators from their competitors.

The industry for mobile location services is still very much in its infancy,
but new wireless services are an explosive growth area. It has taken longer than
we expected for this industry to "take off', but most experts agree that growth
is about to accelerate to massive proportions. We believe that 70% - 80% of
mobile phone users will employ location services by 2005, and that the location
component is key to using the Internet from mobile devices. Location services
for mobile users offer broad utility, and can be grouped into four categories:
management and tracking, information, entertainment and security. While the
industry is very new, we expect that commercial services with a strong business
case for management and service applications will be the first to enter the
market, but the mass-market services including information and entertainment
services will be much larger over time.

COMPANY HISTORY

Effective February 28, 1999, CellPoint acquired technology and intellectual
property rights from Novel Electronic Systems & Technologies ("Novel") for the
core GSM positioning technology originally developed in South Africa. We own the
original core positioning technology, and have the right to use it worldwide,
with the exception of sub-Saharan Africa for vehicle tracking applications which
are owned by Matrix Vehicle Tracking (Pty) Ltd., a corporation organized under
the laws of South Africa ("Matrix"). The GSM positioning technology was
originally commercialized by Wasp and Matrix, and has been in commercial use in
South Africa for more than four years. There are more than 28,000 commercial
users of the original technology in South Africa. We have entered into a
cooperation agreement with Matrix whereby Matrix has made available to us its
knowledge and know-how regarding GSM positioning applications, strategies and
service delivery.

CellPoint has subsequently developed Mobile Location System ("MLS"), a third
generation location platform that works with all GSM phones in all GSM, GPRS and
UMTS networks regardless of network infrastructure, and without overlays or
modifications to the network.

CORE BUSINESS

CellPoint's mission is to be the global leader in providing
location-enabling solutions toward GSM/ UMTS operators and service providers.

CellPoint's core business is to provide location system software, including
location platforms, selective location technology and selective location
applications. Core operations are Product Portfolio Management, Systems
Management, Product/Systems Development, Systems Verification, 2nd and 3rd line
support, marketing and direct touch/partner sales and sales support. Non-core
operations are supply and support of hardware (e.g. computer platforms), 1st
line support, volume sales, development of applications, and systems
integration.

CellPoint provides strong solutions in all layers--the positioning
technology, the middleware and the location applications--and provides open
interfaces for third party development through our Location Developers' Zone
("LDZ").

The clear requirement for third generation/UMTS terminals to operate in GSM
networks and the need for a combination of high-accuracy positioning methods
coupled to technologies offering

high-position availability has lead CellPoint systems to develop a location
platform offering a powerful combination of Assisted Global Positioning System
("A-GPS") and Cell-based positioning for trusted clients at a very competitive
price to the operator. The solutions offer full support for inter-network
roaming.

In order to support 3rd party applications as well as trusted applications,
CellPoint offers a middleware platform, Mobile Location Broker ("MLB") handling
anonymity, end-user privacy management and geo-server support with centralized
map rendering, routing, geo-coding and reverse geo-coding. This platform can be
placed in a separate security zone to the positioning platform, giving flexible
support for operator security requirements.

Progressive mobile operators are already launching location-based services,
opening up the market and motivating others to invest in a competitive
environment. Most are looking at location as a core business and will require
the type of carrier-grade, high-capacity and secure systems which fall within
CellPoint's product roadmap.

APPLICATIONS AND LOCATION TECHNOLOGY PLATFORM

Evolving GSM and UMTS standards will open up competition between providers
for system layers in location-based systems, creating a clear division between
location platforms and location applications.

NETWORK-BASED LOCATION PLATFORM. In September 2000, CellPoint announced a
new location platform, CellPoint Mobile Location System (MLS), capable of
locating any subscriber in a GSM network. MLS is a network-based solution that
works across multi-vendor GSM and UMTS infrastructures and does not require any
network upgrades or overlays. MLS is the central software node in a location
services system. It has open APIs and integrates location technologies with
applications, services, mapping, content terminals and browsers.

With CellPoint's MLS platform, mobile operators will be able to move
transparently from GSM to UMTS. MLS provides seamless migration from second
generation GSM networks to third generation ("3G") UMTS networks; this allows 3G
operators to offer location services in an effective manner during the build-up
phase of their networks, considerably enhancing the initial service offering for
3G operators.

CellPoint had already developed and deployed commercial location technology
using the Subscriber Identity Module (SIM) card on standard phones. MLS is the
latest CellPoint development and does not require a specially programmed SIM
card or WAP phone and is targeted at mass-market location services such as
friend finding and information services.

In March 2001, we announced our first installation of MLS with E-Plus, one
of the leading mobile operators in Germany. E-Plus demonstrated new location
services using MLS at the CeBIT technology exhibition in Germany in March 2001.

RESOURCE MANAGER. Our Resource Manager is a valuable tool for fleet and
personnel managers such as service and repair companies, sales organizations,
courier and shipping agencies, coach companies, taxi services, car rental
agencies, delivery firms, railroad companies, etc., that want to manage their
mobile resources and assets more effectively. The communication and positioning
system will help fleet owners to optimize routes and allocate resources.
Customers of these organizations can also benefit from increased information
being made available to them through the delivery of new location services, such
as when to expect a delivery, installation or service repair person. While we
believe that the potential cost savings for fleet owners and personnel managers
using the CellPoint System are significant, we have not had extensive experience
yet in the commercial use of these products.

Our first commercial agreement was signed in April 1999 with Tele2, a GSM
network operator in Sweden, for positioning services for GSM mobile phones. A
similar system was delivered to France Telecom Mobiles and announced on
July 13, 2000 where France Telecom Mobiles licensed CellPoint's location
platform and one location services application, Resource Manager.

On October 9, 2000, we announced a commercial agreement with EuroTel Praha
spol sro. of the Czech Republic for our MLS platform and applications. EuroTel,
using CellPoint's latest location-based service technology, is able to offer its
customers our Resource Manager service based on their current mobile phones and
SIM cards.

FINDER! Finder! is designed for and targeted to the mass consumer market.
It allows users to maintain buddy lists and view the location of pre-defined,
consenting individuals relative to their own location, send messages to these
people or call them. We believe Finder! offers both entertainment value as well
as practical value for consumer and business users.

IMATE. iMate addresses the broadest range of needs in mass-market mobile
use. iMate is both a full-featured information service for mobile users and a
powerful content collector and integrator. Information can be sourced from any
number of websites or databases. Internet content and geographical information
is delivered to users based on their location. Content delivered includes
weather and traffic reports to personal navigation, proximity services, and
concierge services. Information is structured in a navigable hierarchy to
optimize ease of use. Through the integrated use of mobile device positioning
and profiling, the user has a very powerful and user friendly tool to simplify
everyday life or to get more out of a visit to an unfamiliar area.

PERSONAL SECURITY. This service concept is based on mobile positioning
technology and allows personalized user profiles in case of emergency or threat.
In a distressed situation, the user may press predefined buttons on the mobile
phone. The phone sets up a voice call to an alarm center and sends positioning
information for the caller to the alarm center via CellPoint's location services
platform. The caller's position is shown to the operator on a digital map. Each
user makes an action plan when he or she subscribes to the service. The action
plan can contain medical information about blood type or allergies, contact
persons at work or home and other information such as hazardous cargo the person
may be transporting. With this information at hand, the emergency operator has
the caller's location and a much better chance to provide the distressed person
with the appropriate assistance.

STANDARDS

All GSM phones support the CellPoint MLS technology today. As GSM standards
open up for competition between system layers in location-based systems, a clear
division between location platforms and location applications will develop over
time. CellPoint provides systems in all layers--the positioning technology, the
middleware and the location applications--and provides open interfaces for third
party development. Operating entirely within GSM, Internet and WAP standards,
CellPoint's location technology and services platform require no network add on
or overlay and work in any GSM network regardless of infrastructure vendor or
vendors, allowing for worldwide roaming capabilities.

We contribute to the setting of standards through our membership and
participation in the WAP Forum (we also hold the Secretary position for Location
Services), ETSI (European Telecommunications Standards Institute, "ETSI") and
the Location Interoperability Forum ("LIF") where we chair the Mobile Location
Protocol/Application Programming Interface (MLP/API) definition group.

The United States Federal Communications Commission (the "FCC") adopted a
ruling in June 1996 (Docket No. 94-102) that mandates all cellular telephone
carriers to provide location information on all 911 calls by October 2001;
however no carriers were in compliance with the mandate as of October 1, 2001.
We believe that other countries may mandate similar requirements in the future.

Even without such additional regulations, we believe that many cellular carriers
are interested in providing new value-added services incorporating cellular
location such as the services available from CellPoint.

SYSTEM COMPONENTS

CellPoint is an end-to-end developer, supplier and enabler of mobile
location software technology and platforms. CellPoint provides systems in all
layers--the location technology, the middleware and the location applications.
CellPoint's location technologies utilize standard GSM functionality that is
already supported by all major GSM infrastructure suppliers today. The main
components of the technology are the CellPoint Mobile Location System and the
Mobile Location Broker. These third generation location platforms support our
location technology, provides open interfaces aligned with third generation
standards and is designed to support all or most location technologies expected
to reach commercial success in the future. It is through the platforms that all
operations and services run.

The Mobile Location System provides a generic location and messaging
platform that can be shared by several different applications, such as Finder!,
iMate or Resource Manager. In order to support third party applications as well
as trusted applications, CellPoint offers a middleware platform, Mobile Location
Broker, which handles anonymity, end-user privacy management and geo-server
support with centralized map rendering, routing, geo-coding and reverse
geo-coding. This platform can be placed in a separate security zone to the MLS
positioning platform, giving flexible support for operator security
requirements. The application servers utilize the Mobile Location System through
an Application Programmers Interface (APIs), which enables location of a mobile
terminal using a uniform protocol that is independent of the type of location
provider used. CellPoint also makes the API available to other application
developers who can then deliver their location-based services through
CellPoint's platform. There are a number of third party developers already doing
this, which will provide us with even more applications which the GSM operators
can offer their subscribers. A positioning server is attached to the Mobile
Location System, as are the map servers, dedicated terminal servers and other
databases.

The CellPoint System utilizes:

- A standard, unmodified GSM, GPRS or UMTS cellular network;

- Proprietary server system, the CellPoint Mobile Location System, (server
hardware and software) interacting with the GSM cellular network
operator's system, placed at the operator's site, at CellPoint's premises
or third party premises;

- A standard GSM cellular phone, WAP phone other GSM mobile device;

- Application software; and

- The Internet.

The server consists of a number of computers that manage the traffic between
the GSM network and the application software. It is designed to handle large
quantities of messages used in complex applications. The Mobile Location System
manages the communication processes, including routing of messages, calculation
of positions, database management and bi-directional message confirmation.
Remote billing features are also integrated. The CellPoint Mobile Location
System is a high-capacity platform that is fully scaleable and provides
carrier-grade availability.

Application software has been developed based on market and customer driven
principles. Normally these applications provide a graphical or text interface to
display positions on a computer terminal or mobile phone and can also present
information relative to another person's position. Tracking features are also
supported as well as remote updating of message text for defined users.
Information services relative to a user's location are also supported through
application software.

BUSINESS STRATEGY AND COMMERCIAL APPLICATIONS

Our business strategy is to provide mobile location software technology and
platforms enabling location service applications in target markets around the
world. We begin with installing the CellPoint location services platform with a
GSM cellular network operator. The network operator, or a third party, will then
market selected location services as value-added services offered to the
end-users of the cellular network. We can potentially earn revenues through
(i) sale of functionality licenses to network operators for our platforms with a
fixed price for the first capacity level and subsequent increases for additional
capacity, (ii) percentage or fixed price participation in the revenue streams
resulting from the new services offered by the network operator, (iii) usage
revenues from service providers, based on transaction volumes or time frames,
(iv) sale of the CellPoint System to strategic partners where partners are
licensed to operate the technology in a specified geographic area,
(v) maintenance and upgrade fees, (vi) consulting and professional services, and
(vii) programming interfaces.

We are currently running pilot projects and technology evaluations with
cellular network providers for mobile location services throughout Europe and
other parts of the world. We cannot assure our stockholders that any of these
pilot projects will result in the execution of definitive contracts for our
products and services. We cannot rely on the anticipated revenue from these
projects to meet our current growth and expense projections. There can be no
assurance that the CellPoint System will achieve a significant degree of market
share, and that such acceptance, if achieved, will be sustained for any
significant period or that life cycles of that technology will be sufficient (or
substitute products available) to permit us to recover start-up and other
associated costs.

We are also cooperating with numerous companies of all sizes in the areas of
marketing and sales, distribution, application development, standards setting,
systems integration and installation and support.

COMPETITION

The wireless industry continues to undergo rapid change, and competition is
intense and is expected to increase. We are aware that other companies and
businesses market, promote and develop technologies and products that could be
competitive with or are functionally equivalent to those that we have. We expect
that companies or businesses that may have developed or are developing such
technologies and products, as well as other companies and businesses that have
the expertise which could encourage them to develop and market competitive
products and technologies, may attempt to develop technologies and products
directly competitive with ours. Many of these competitors have greater financial
and other resources than we have.

Although we believe that the CellPoint System is unique, there can be no
assurances that other companies will not introduce similar or more advanced
technologies. The location services market can be divided into three parts,
(i) the location technology, (ii) the location platform and (iii) the
applications. We are active in all three areas.

TECHNOLOGY. There are two different types of positioning technologies:
handset-based and network-based. Our technology was originally handset-based
positioning technology, but we have also developed MLS which is a unique
integrated network-based solution. Our positioning technologies are all
software-based with no need for hardware overlays or add-ons to an operator's
network.

Network-based solutions can be divided into overlay systems and integrated
solutions. Most competitors have pursued overlay systems. These systems are very
costly and time-consuming to implement, since they require hardware changes
and/or add-ons to the network. We are not aware of the implementation of a
commercial overlay system to date. Most companies in the industry pursued
network-based overlay system location technology solutions subsequent to a
mandate by the FCC in the United States in 1996. The FCC mandate required that
all mobile phones be positioned by

October 2001, irrespective of the type or vintage of phone. This led companies
to pursue network-based overlay location technologies. As of October 1, 2001, no
US carriers were in compliance with the FCC's mandate.

In September 2000, we announced a network-based solution to position any
cellular phone in a GSM network, regardless of age of the phone or network
infrastructure supplier. This new technology developed by us is called MLS and
is an integrated software-only solution for network-based positioning and now
extends our location service applications to all mobile GSM users.

Handset-based technologies can require new model phones, programmed SIM
cards or use of WAP phones to be positioned. Our positioning technology was
originally developed out of the need to track stolen cars. The concept was to
utilize information that was already in existence in a GSM network and have a
"smart terminal" that could gather sufficient information from the network and
allow a server system to calculate the location very quickly.

In November 1998, we announced the capability to position normal cellular
phones. The technology from the special terminals could now be utilized in
normal mobile phones with a standard SIM card containing a program developed by
CellPoint, which opened up a vast market for us for new location services.
Location services for normal mobile phones are the focus of our developments and
service offerings today.

We believe that the technology and applications offered by CellPoint have
distinct advantages over other systems currently being marketed by other
companies. For instance, another handset-based solution is built on Global
Positioning System (GPS), which uses satellites to determine an X,Y position.
GPS requires free line of sight to a minimum of three satellites. We view GPS
not as a competing technology but rather complementary to our offerings. GPS
provides excellent location coordinates, but our engineers' research has shown
that it is insufficient as a stand-alone solution for location services for
mobile phones.

A-GPS is a new technology is a relatively new system that improves the
functionality and performance of GPS by integrating the classic GPS information
with sophisticated geographic software and mobile/cellular network information.
We believe network operators will implement A-GPS solutions over time as the
technology becomes commercially available. A-GPS is a complementary positioning
technology to today's enhanced Cell-identification technology and our MLS
platform is designed to work with A-GPS when it is commercially available. In
August 2001, we announced a strategic partnership with SiRF Technology, Inc., a
leading developer of location technology based on GPS, to deliver a platform to
GSM operators that provides highly accurate location information to mobile users
in any environment.

Network-assisted GPS enhances GPS availability but it is widely accepted
that it will not be not sufficient for mass commercial location services because
users demand location functionality 100% of the time. GPS-equipped mobile phones
have started limited commercial availability in 2001, albeit as a very limited
percentage of the total mobile device market and more of a niche offering. We
support GPS and A-GPS today and we view A-GPS as an excellent complement to the
CellPoint System. We believe that a roadmap that involves CellPoint's enhanced
Cell-ID solution in the short-term, and then when A-GPS handsets are widely
available, a combination of enhanced Cell-ID/A-GPS will be the ideal solution
for mobile operators and end-users of location-based services.

LOCATION SERVICES PLATFORM. We view ourselves primarily as enablers of
location technology and services. Our location services platforms are the
"middleware" in the total solution. MLS and MLB are fully GSM-compliant, thus
work with all GSM networks, regardless of infrastructure supplier, and also work
in multi-vendor infrastructure environments. We believe that there will be
multiple positioning technologies available in the future and no single one will
be most suitable in all cases. Consequently, our Location Services Platform will
support all or most positioning technologies expected to reach

commercial success. Middleware vendors, such as SignalSoft and Ericsson have
begun to market location platform solutions. Many others are expected to come to
market in the future, but we believe that our ability to offer an end-to-end
solution to GSM operators will give us a significant time advantage in deploying
our platform. We also intend to cooperate with these companies to increase the
number of applications being offered to the operators.

APPLICATIONS. Today, we are focusing on mobile location software technology
and platforms. We have open APIs (Application Programmers Interface) available
to partners that are developing location-based applications through our Location
Developers' Zone. We expect that, in the next few years, hundreds of
applications will be delivered via our platform, with the majority being
developed by other companies using our APIs.

RESEARCH AND DEVELOPMENT

In Fiscal 2001, we spent approximately $5,000,000 on development activity,
of which approximately $790,000 has been capitalized. We spent approximately
$2,431,000 on research and development activities in Fiscal 2000, of which none
was capitalized. Our personnel have substantial experience in the areas of GSM
and UMTS architecture, SS7 signaling, positioning technologies, WAP, Mobile
Internet, Unix and Windows.

Development projects are carried out in-line with the time-to-market process
that span from pre-studies to first customer application and roll-out. The
process provides activity and documentation guidelines, management decision
points, configuration management, testing and release control. No product or
application development is finalized without a commitment from at least one
operator or customer.

EMPLOYEES

At September 30, 2001, we had 130 full-time employees and 30 consultants in
the location services area. Of the total 130 employees, 84, 25 and 21 were
employed in Sweden, England and South Africa, respectively. None of our
employees is represented by a labor union. We consider our relations with our
employees to be very good.

TRADEMARKS AND PATENTS

CellPoint is maintaining and building a patent portfolio within its defined
target markets in order to maximize competitiveness and to avoid infringements
on other parties' technical solutions. The existing portfolio consists of
approved location technology patents and a number of filed location technology,
middleware and application patents. Since 1997, the Company has applied for
several patents for the CellPoint System; most of which are currently pending;
three of which have been accepted. In addition, we have applied for more than 20
additional patents with respect to our technologies.

We believe that the complexity involved in developing these technologies
offers considerable protection against similar developments. Our technologies
have been under development for more than five years and are continually being
refined and improved.

DISCONTINUED OPERATIONS

UNWIRE AB AND TELEMATICS OPERATIONS IN CELLPOINT SOUTH AFRICA

On February 29, 2000, we acquired all of the capital stock of Unwire AB.
Unwire develops systems and equipment for GSM positioning and telematics. We
paid the purchase price by issuing to the stockholders of Unwire an aggregate of
1,075,000 shares of Common Stock with a market value of approximately
$70.7 million. In the fourth quarter of Fiscal 2001, our Board of Directors
determined that the investment required to operate the telematics business
segment did not fit in with the Company's longer-term strategic goals. We intend
to concentrate all of our efforts and resources in developing and promoting
location-based services. We have been unable to identify a purchaser for Unwire.

On October 9, 2001, our subsidiary, Unwire, filed for bankruptcy in Sweden.
As a result of the filing we have effectively ceased all funding of Unwire
operations. The bankruptcy courts have appointed a trustee to oversee the
disbursement of Unwire's assets and we have effectively lost control of its
management and decision making capabilities over Unwire operations.

We anticipate that CellPoint Systems SA ("Systems SA"), its South African
subsidiary will also file for bankruptcy. Systems SA operated a research and
development facility for the Company. The telematics portion of Systems SA has
already been included in the discontinued operations. The location services
portion of Systems SA is not included in discontinued operations, and those
functions will continue to be performed by the Company's Swedish subsidiary.
Costs of closing this subsidiary, primarily the write-off of the net receivable
from Systems SA, have been accrued in the June 30, 2001 financial statements.
The assets, liabilities and results of operations of Systems SA were immaterial
to the financial statements of the Company for all periods presented. At
September 30, 2001, there were 40 full-time employees in the business area of
telematics, of which 25 were employees of Unwire and 15 were employees in
CellPoint South Africa.

DESCRIPTION OF SECURITIES

We are authorized to issue 22,000,000 shares of Common Stock and 3,000,000
shares of preferred stock, par value $0.001 per share ("Preferred Stock"). As of
October 19, 2001, 16,355,543 shares of our Common Stock were issued and
outstanding and no shares of preferred stock were outstanding. On October 17,
2001, our Board of Directors approved an amendment to our Articles of
Incorporation increasing our authorized capital stock to 50,000,000 shares of
Common Stock and 10,000,000 shares of Preferred Stock. This amendment is being
submitted to our stockholders for approval at our Annual Meeting scheduled for
December 5, 2001. If such amendment is approved at the Annual Meeting, we will
file such amendment immediately thereafter with the Secretary of State of
Nevada.

COMMON STOCK

The holders of our Common Stock are entitled to one vote for each share held
of record on all matters to be voted on by those stockholders. There is no
cumulative voting with respect to the election of directors of the Company, with
the result that the holders of more than 50% of our Common Stock voted for the
election of directors can elect all of those directors. The holders of our
Common Stock are entitled to receive dividends when, as, and if declared by the
Company's Board of Directors from funds legally available therefor. In the event
of liquidation, dissolution, or winding up of the Company, the holders of our
Common Stock are entitled to share ratably in all assets remaining available for
distribution to them after payment of the Company's liabilities and after
provision has been made for each class of stock, if any, having preference over
our Common Stock. Holders of shares of our Common Stock, as such, have no
conversion, preemptive or other subscription rights, and there are no redemption
provisions applicable to our common stock. All of the outstanding shares of our
Common Stock are fully paid and non-assessable.

NONCUMULATIVE VOTING

The holders of shares of our Common Stock will not have cumulative voting
rights, which means that the holders of more than 50% of our outstanding Common
Stock, voting for the election of directors of the Company, may elect all of the
directors of the Company to be elected, if they so desire, and, in such event,
the holders of our remaining Common Stock may not be able to elect any of the
Company's directors.

REGISTRATION RIGHTS

Holders of shares of our Common Stock are not entitled to rights with
respect to the registration of such shares under the Securities Act. The Shares
being sold by the Selling Stockholders pursuant to this Prospectus have been
registered pursuant to registration rights granted by the Company to the Selling
Stockholders.

Pursuant to a Registration Rights Agreement with Castle Creek, we agreed to
register the shares that may be issuable upon conversion of the notes and the
exercise of the warrants issued to Castle Creek. Of the shares included in this
Prospectus, 985,810 shares are registered for the benefit of Castle Creek. In
addition, we agreed to register such number of additional shares as may become
issuable pursuant to the anti-dilution provisions of the notes and the warrants
issued to Castle Creek, and shares issuable pursuant to warrants.

DIVIDENDS

Whether or not we pay any dividends in the future will be determined by our
Board of Directors, in its discretion, and will depend among other things, upon
our earnings, our capital requirements, and our financial condition, as well as
other relevant factors. We have not paid or declared any dividends to date. We
intend to retain any earnings for the operation and expansion of its business
and do not anticipate paying cash dividends in the foreseeable future.

PREFERRED STOCK

We are authorized to issue preferred stock with such designations, rights
and preferences as may be determined from time to time by our Board of
Directors. Or Articles of Incorporation currently provide that shares of
Preferred Stock must be non-voting. On October 17, 2001, our Board of Directors
approved an amendment to our Articles of Incorporation increasing the authorized
number of shares of Preferred Stock from 3,000,000 to 10,000,000 and allowing
the Board of Directors to determine what voting rights, if any, the shares of
Preferred Stock will have. This amendment is being submitted to our stockholders
for approval at our next Annual Meeting, scheduled for December 5, 2001.
Accordingly, our Board of Directors is empowered, without stockholder approval,
to issue preferred stock with liquidation privileges, dividend, conversion,
voting, or other rights that could adversely affect the voting power or other
rights of the holders of our Common Stock. In the event of issuance, our
Preferred Stock could be utilized, under certain circumstances, as a method of
discouraging, delaying or preventing a change in control of the Company.

CASTLE CREEK CONVERTIBLE NOTES AND WARRANTS

On December 6, 2000, the Company and Castle Creek entered into a Securities
Purchase Agreement pursuant to which the Company issued to Castle Creek 6%
convertible notes in the aggregate original principal amount of $10,000,000 and
five-year warrants to purchase up to 210,526 shares of Common Stock. The notes
are not convertible and the warrants are not exercisable to the extent that,
after giving effect to such conversion and exercise, Castle Creek would be the
beneficial owner of more than 4.99% of the outstanding shares of the Company's
Common Stock at any time. On July 25, 2001 and September 26,2001, the Company
and Castle Creek restructured the terms for repurchase of the notes pursuant to
which (a) we paid $2.25 million to Castle Creek for principal and

accrued interest, (b) we agreed to repurchase the remaining outstanding
convertible notes at 100%, (c) the convertible notes are subject to a fixed
conversion price of $4.00, and are scheduled to be repurchased on October 1,
2002 for approximately $6.1 million plus accrued interest (subject to specified
adjustments in the event of a material breach by the Company), and (d) we
granted to Castle Creek a security interest in our assets (including the assets
of its subsidiaries), including our intellectual property. See "Summary
Information--Recent Developments".

STOCK INCENTIVE PLAN

We have adopted a stock incentive plan (the "Plan"). Pursuant to the
provisions of the Plan, 2,000,000 shares of the Company's Common Stock are
reserved for issuance upon exercise of options. The Plan is designed to retain
qualified and competent officers, employees, and directors of the Company.

The Company's Board of Directors, or a committee thereof, shall administer
the Plan and is authorized, in its sole and absolute discretion, to grant
options thereunder to all eligible employees of the Company, including officers
and directors (whether or not employees) of the Company. Options will be granted
pursuant to the provisions of the Plan on such terms and at such prices as
determined by the Company's Board of Directors. The exercise price will not be
lower than the closing price on the date the options are issued, or if such
prices are not available, at the fair market value as determined by the Board of
Directors. Options granted under the Plan will be exercisable after the period
specified in the option agreement. Options granted under the Plan will not be
exercisable after the expiration of ten years from the date of grant. The Plan
will also authorize the Company to make loans to optionees to enable them to
exercise their options. During our fiscal year ended June 30, 2001, 192,600
options were exercised, 250,300 were cancelled, and 244,900 options were
granted. There were 803,100 options outstanding as of October 15, 2001. To date,
the Company has not issued any stock appreciation rights.

STOCK WARRANT PLAN

We have adopted a stock warrant plan (the "Warrant Plan"). Pursuant to the
provisions of the Warrant Plan, eligible employees, consultants and affiliates
will be given the opportunity to purchase warrants, which warrants can be
exercised, upon vesting, to purchase shares of the Company's Common Stock. An
aggregate of 1,000,000 shares of the Company's Common Stock have been reserved
for issuance pursuant to the Warrant Plan. On October 17, 2001, our Board of
Directors adopted an amendment to the Warrant Plan increasing the number of
shares authorized to be issued under the Warrant Plan to 1,500,000. This
amendment is being submitted to our stockholders for approval at our next Annual
Meeting of Stockholders scheduled for December 5, 2001. The Plan is designed
primarily to retain qualified and competent officers and employees.

The Board of Directors of the Company, or a committee thereof, shall
administer the Plan and is authorized, in its sole and absolute discretion, to
grant options thereunder to all eligible employees, consultants and affiliates
including the Company's officers and directors (whether or not employees).
Warrants will be sold to eligible persons at prices determined by independent
appraisers to be fair market prices at the time of such sale. Each warrant will
have an exercise price equal to no less than either 125% or 150% of the closing
price of the Company's Common Stock on the date immediately preceding the date
of sale. Each warrant sold pursuant to the Warrant Plan will be subject to a
vesting period as determined by the Board of Directors, and will expire no later
than five years from the date of issuance. To date, warrants with respect to an
aggregate of 518,800 shares have been sold.

TRANSFER AGENT

The Transfer Agent for our Common Stock is U.S. Stock Transfer Corporation,
1745 Gardena Avenue, Suite 200, Glendale, California 91204, telephone
818-502-1404.

THE SELLING STOCKHOLDERS

The persons listed below are the Selling Stockholders:

AMOUNT OF
NUMBER OF PERCENTAGE OF COMMON STOCK
SHARES OF BENEFICIAL TO BE HELD
COMMON STOCK OWNERSHIP AMOUNT OF AFTER OFFERING
BENEFICIALLY BEFORE COMMON STOCK IS
NAME OF SELLING STOCKHOLDER OWNED OFFERING REGISTERED COMPLETED(1)
--------------------------- ------------ ------------- ------------ --------------

Advanced Equities, Inc....................... 10,286(7) * 10,286 0
Agner, Torsten............................... 2,523(3) * 2,523 0
Akelius Inc, Sundqvist....................... 73,168(3) * 73,168 0
Alve Andersson Pension....................... 3,000(3) * 3,000 0
Anderson, Michael H. & Anderson, Florence
A.......................................... 35,716(4) * 35,716 0
Andersson, Mats.............................. 9,821(3) * 9,821 0
Anima America................................ 21,428(4) * 21,428 0
Anima Fondattivo............................. 21,428(4) * 21,428 0
Anima Fondo Trading.......................... 28,572(4) * 28,572 0
Bank of N.Y. (P-O Olsson c/o Joelle Kuster... 21,408(3) * 21,408 0
Banque Carnegie c/o Joelle Kuster............ 21,000(3) * 21,000 0
Benckert, Catarina........................... 24,000(3) * 24,000 0
Benckert, Vicki.............................. 24,000(3) * 24,000 0
Benkert, Lennart............................. 73,168(3) * 73,168 0
Bergli, Arne................................. 25,227(3) * 25,227 0
Bergli, Arne................................. 15,237(3) * 15,273 0
Bernhall, Christer........................... 18,711(3) * 18,711 0
Biocentura AB................................ 15,000(3) * 15,000 0
Capra, Chris................................. 12,857(6) * 12,857 0
Casarina Investments Ltd..................... 750,000(2) 4.5% 750,000 0
Castle Creek Technology Partners LLC......... 816,141(5) (5) 985,810 0
Chapel Holdings Ltd.......................... 1,125,000(2) 6.7% 1,125,000 0
Dagbjartsson, Eggert......................... 128,572(4) * 128,572 0
Dahlman, Hans................................ 2,625(3) * 2,625 0
Danielsen, Annemarie......................... 36,584(3) * 36,584 0
Eide, Ragnar................................. 4,500(3) * 4,500 0
Engstrand, Helena............................ 24,390(3) * 24,390 0
Foster, Sandra J............................. 42,857(4) * 42,857 0
Fotogr Karkkaninen AB........................ 48,779(3) * 48,779 0
Gerard Klauer Mattison & Co., Inc............ 86,207 * 86,207 0
Gustafson, Rolf.............................. 3,750(3) * 3,750 0
Hayes, Robert M.............................. 85,715(4) * 85,715 0
Heijdenberg, Anders.......................... 15,000(3) * 15,000 0
Hein, Curt................................... 4,286(6) * 4,286 0
Holm, Lars................................... 48,779(3) * 48,779 0
Hughes Holdings, LLC......................... 71,429(4) * 71,429 0
Jalmestig, Lars.............................. 12,195(3) * 12,195 0
Johannesson, Eskil........................... 97,557(3) * 97,557 0
Johansen, Kim................................ 15,000(3) * 15,000 0
Karkkaninen, Lasse........................... 24,390(3) * 24,390 0
KBTSKRF Forlag AB............................ 16,500(3) * 16,500 0
Kessler Family Ltd. Partnership.............. 285,714(4) 1.7% 285,714 0
Kessler, Irvin............................... 142,858(4) * 142,858 0

Kopriwa, Mikael.............................. 24,390(3) * 24,390 0
Larsson, Gert................................ 498,945(3) 3.0% 498,945 0
Lefwander, Anette............................ 48,779(3) * 48,779 0
Lefwander, Johan............................. 48,779(3) * 48,779 0
Lindberg, Olof............................... 74,633(3) * 74,633 0
Lindqvist, Lars.............................. 1,500(3) * 1,500 0
Lindstrom, Bertil............................ 3,000(3) * 3,000 0
Lindstrom, David............................. 4,500(3) * 4,500 0
Macco Investments............................ 750,000(2) 4.5% 750,000 0
Maklin, Anders............................... 12,567(3) * 12,567 0
Marassa, Robert.............................. 12,143(6) * 12,143 0
Massner, Ronald W............................ 71,429(4) * 71,429 0
Mattsson, Jan................................ 12,613(3) * 12,613 0
MBS Holdings, LLC............................ 35,716(4) * 35,716 0
Michaelsen, James B.......................... 71,429(4) * 71,429 0
Micronet AB.................................. 160,713(8) * 160,713 0
Moore, Michael............................... 177,858(4) 1.1% 142,858 35,000
Morner, Fredrik.............................. 15,000(3) * 15,000 0
Moss, Jeffrey................................ 12,857(6) * 12,857
Olsson, Per-Ove.............................. 49,104(3) * 49,104 0
Over the Hill Ltd............................ 71,429(4) * 71,429 0
Pazdan, Paul................................. 35,716(4) * 35,716 0
Pegenius, Anders............................. 3,000(3) * 3,000 0
Persson, Ulf................................. 6,000(3) * 6,000 0
Petersen, Finn (DK).......................... 24,552(3) * 24,552 0
Peterson, Dominik............................ 24,552(3) * 24,552 0
Peterson, Dominik............................ 23,448(3) * 23,448 0
Peterson, Margareth.......................... 12,195(3) * 12,195 0
PMC AB (Bengt Romlin)........................ 12,497(3) * 12,497 0
Pruitt, John P............................... 71,429(4) * 71,429 0
Pulaski Enterprises Ltd. c/o C-J Tornell..... 572,183(5) 3.5% 572,183 0
Rasmussen, James E........................... 142,858(4) * 142,858 0
Rationell Materialhanterir P. Stahle AB:s
Sarskilda.................................. 36,584(3) * 36,584 0
Rogers, Shawn................................ 12,143(6) * 12,143
Ronald Sheldon Trust......................... 35,716(4) * 35,716 0
Ronald Stone Insurance Trust................. 71,429(4) * 71,429 0
Rudell Corporation Ltd., The................. 1,125,000(2) 6.7% 1,125,000 0
Shilshire Holdings Ltd....................... 1,125,000(2) 6.7% 1,125,000 0
Shoffner, John P............................. 171,428(4) 1.0% 171,428 0
Solem, Richard H............................. 71,429(4) * 71,429 0
Stahle, Peter................................ 916(3) * 916 0
Sundqvist, Kjell Ake......................... 73,168(3) * 73,168 0
Thuresson, Gunnar............................ 24,390(3) * 24,390 0
Visqueno, Elenita............................ 18,414(3) * 18,414 0
Wallman, Bengt............................... 12,474(3) * 12,474 0

Wallman, Kjell............................... 15,000(3) * 15,000 0
Wennberg, Staffan............................ 12,195(3) * 12,195 0
Wonsover, Jacob.............................. 2,857(6) * 2,857 0
XIST AB...................................... 10,500(3) * 10,500 0
TOTAL........................................ 10,249,871 10,384,540 35,000

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

(1) Assumes all shares covered by this Prospectus are sold.

(2) Of the shares listed as beneficially owned, one-third are issuable upon
exercise of warrants with an exercise price of $2.25 per share and a term of
two years.

(3) Of the shares listed as beneficially owned, one-third are issuable upon
exercise of warrants with an exercise price of $2.36 per share and a term of
two years.

(4) Of the shares listed as beneficially owned, one-third are issuable upon
exercise of warrants. Half of these warrants are exercisable at $3.50 per
share until October 5, 2002, and half of these warrants are exercisable at
$5.00 per share until October 5, 2003.

(5) This amount represents shares issuable upon conversion of notes and the
exercise of warrants, subject to the limitation that the warrants and the
notes are not exercisable or convertible to the extent that if converted by
the holder, such holder would be the beneficial owner of more than 4.99% of
the outstanding shares of our Common Stock at the date such securities were
issued. The 4.99% limitation may not prevent Castle Creek from converting
all of its notes or exercising all of its warrants in a series of
transactions such that the 4.99% limitation does not prevent Castle Creek
from selling more than 4.99% of our Common Stock in the aggregate. The
outstanding Castle Creek notes of $6,105,100 million are convertible at
$4.00 per share, subject, in the event of a material breach by the Company,
to specified adjustments. See "Summary Information--Recent Developments".
Accordingly, in accordance with our agreement with Castle Creek, we have
included in this Prospectus, an aggregate of 985,810 shares, which may
become issuable to Castle Creek upon conversion of the notes and exercise of
the warrants. These are in addition to shares previously registered for the
benefit of Castle Creek. The Company is negotiating with Castle Creek as to
the operation of the anti-dilution provisions in the July 2001 warrant,
which Castle Creek claims require us to register additional shares for
Castle Creek. The Company may assert a claim against its former legal
counsel in regard to its representation of the Company in connection with
such warrant document.

(6) Represents shares issuable upon exercise of warrants with an exercise price
of $1.32 and a term of five years.

(7) Represents shares issuable upon exercise of warrants with an exercise price
of $1.32, and which are exercisable on October 5, 2002.

(8) Represents shares issued and shares issuable upon exercise of warrants with
an exercise price of $2.50 and a term of two years in connection with the
acquisition by the Company of the remaining 42% interest in Micronet.

* Less than 1%.

Kjell Wallman, one of the Selling Stockholders, was a director of the
Company from January 1999 through December 2000. See "Summary
Information--Recent Developments" for a discussion of the transactions between
the Company and Castle Creek.

PLAN OF DISTRIBUTION

We will not receive any of the proceeds of the sale of the Shares offered
hereby. Some of the Shares included in this Prospectus have not yet been issued,
but are issuable upon the exercise of warrants held by certain of the Selling
Stockholders, which warrants have exercise prices ranging from $1.32 to $5.00.
In connection with the exercise of such warrants, each warrant holder may elect
to pay the exercise price by (i) cash or check or (ii) net issuance; i.e.,
cashless exercise. To the extent that a warrant holder elects the net issuance
method, we would not receive any cash as a result of such exercise. Additional
proceeds, if any, that we receive from the exercise of the warrants will be used
for working capital.

The Shares may be sold from time to time to purchasers directly by the
Selling Stockholders. Alternatively, the Selling Stockholders may from time to
time offer the Shares through brokers, dealers or agents who may receive
compensation in the form of discounts, concessions or commissions from the
Selling Stockholders and/or the purchasers of the Shares for whom they may act
as agent. The Selling Stockholders and any such brokers, dealers or agents that
participate in the distribution of the Shares may be deemed to be
"underwriters", and any profits on the sale of the Shares by them and any
discounts, commissions or concessions received by any such brokers, dealers or
agents might be deemed to be underwriting discounts and commissions under the
Securities Act. To the extent the Selling Stockholders may be deemed to be
underwriters, the Selling Stockholders may be subject to certain statutory
liabilities of the Securities Act, including, but not limited to, Sections 11,
12 and 17 of the Securities Act and Rule 10b-5 under the Exchange Act.

From time to time, the Selling Stockholders may be engaged in short sales,
short sales against the box, puts and calls and other hedging transactions in
our securities, and may sell and deliver the shares in connection with such
transactions or in settlement of securities loans. These transactions may be
entered into with broker-dealers or other financial institutions. In addition,
from time to time, a Selling Stockholder may pledge its shares pursuant to the
margin provisions of its customer agreements with its broker-dealer. Upon
delivery of the shares or a default by a Selling Stockholder, the broker-dealer
or financial institution may offer and sell the pledged shares from time to
time.

The Shares offered hereby may be sold from time to time in one or more
transactions at fixed prices, at prevailing market prices at the time of sale,
at varying prices determined at the time of sale or at negotiated prices. The
Shares may be sold by one or more of the following methods, without limitation:
(a) ordinary brokerage transactions and transactions in which the broker
solicits purchasers, (b) an exchange distribution in accordance with the rules
of such exchange, (c) face-to-face transactions between sellers and purchasers
without a broker-dealer, (d) through the writing of options, and (e) other. At
any time a particular offer of the Shares is made, a revised prospectus or
prospectus supplement, if required, will be distributed which will set forth the
aggregate amount and type of Shares being offered and the terms of the offering,
including the name or names of any underwriters, dealers or agents, any
discounts, commissions and other items constituting compensation from the
Selling Stockholders and any discounts, commissions or concessions allowed or
reallowed or paid to dealers. Such prospectus supplement and, if necessary, a
post-effective amendment to the Registration Statement of which this Prospectus
is a part, will be filed with the SEC to reflect the disclosure of additional
information with respect to the distribution of the Shares. In addition, the
Common Stock covered by this Prospectus may be sold in private transactions or
under Rule 144 rather than pursuant to this Prospectus.

To our knowledge, the Selling Stockholders do not currently have any plans,
arrangements or understandings with any broker, dealer, agent or underwriter
regarding the sale of the Shares. There is no assurance that any Selling
Stockholder will not sell any or all of the Shares offered by him, her or it
hereunder or that any such Selling Stockholder will not transfer, devise or gift
such Shares.

The Selling Stockholders and any other person participating in such
distribution will be subject to applicable provisions of the Exchange Act and
the rules and regulations thereunder, including, without limitation,
Regulation M, which may limit the timing of purchases and sales of any of the
Shares by the Selling Stockholders and any other such person. All of the
foregoing may affect the marketability of the Shares and the ability of any
person or entity to engage in market activities with respect to the Shares.

Pursuant to the registration rights set forth in the various subscription
agreements between the Company and the Selling Stockholders, each of the Company
and the Selling Stockholders will be indemnified by the other against certain
liabilities, including certain liabilities under the Securities Act, or will be
entitled to contribution in connection therewith. We have agreed to pay
substantially all of the expenses incidental to the registration, offering and
sale of the Shares to the public other than commissions, fees and discounts of
underwriters, brokers, dealers and agents, transfer taxes and fees and expenses
of Selling Stockholders' counsels.

INDEMNIFICATION

We shall, to the fullest extent permitted by Section 78.7502 of the
Corporation Law of the State of Nevada, as the same may be amended and
supplemented, indemnify under said section any director, officer, employee or
agent from and against any and all expenses, liabilities or other matters
referred in or covered by said section, and the indemnification provided for
herein shall not be deemed exclusive of any other rights to which those
indemnified may be entitled under any By-Law, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office, and shall
continue as to a person who has ceased to be a director, officer, employee or
agent and shall inure to the benefit of the heirs, executors and administrators
of such a person. We will have the power to purchase and maintain officers' and
directors' liability insurance in order to insure against the liabilities for
which such officers and directors are indemnified pursuant to our Amended and
Restated By-Laws.

INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING UNDER THE SECURITIES ACT
MAY BE PERMITTED TO DIRECTORS, OFFICERS OR PERSONS CONTROLLING THE COMPANY
PURSUANT TO THE FOREGOING PROVISIONS, OR OTHERWISE, THE COMPANY HAS BEEN
INFORMED THAT IN THE OPINION OF THE SECURITIES AND EXCHANGE COMMISSION SUCH
INDEMNIFICATION IS AGAINST PUBLIC POLICY AS EXPRESSED IN THE SECURITIES ACT OF
1933, AS AMENDED, AND IS THEREFORE UNENFORCEABLE. IN THE EVENT THAT A CLAIM FOR
INDEMNIFICATION AGAINST SUCH LIABILITIES (OTHER THAN THE PAYMENT BY THE COMPANY
OF EXPENSES INCURRED OR PAID BY A DIRECTOR, OFFICER OR CONTROLLING PERSON OF THE
COMPANY IN THE SUCCESSFUL DEFENSE OF ANY ACTION, SUIT OR PROCEEDING) IS ASSERTED
BY SUCH DIRECTOR, OFFICER OR CONTROLLING PERSON IN CONNECTION WITH THE
SECURITIES BEING REGISTERED, WE WILL, UNLESS IN THE OPINION OF OUR COUNSEL THE
MATTER HAS BEEN SETTLED BY CONTROLLING PRECEDENT, SUBMIT TO A COURT OF
APPROPRIATE JURISDICTION THE QUESTION WHETHER SUCH INDEMNIFICATION IS AGAINST
PUBLIC POLICY AS EXPRESSED IN THE SECURITIES ACT OF 1933, AS AMENDED, AND WILL
BE GOVERNED BY THE FINAL ADJUDICATION OF SUCH ISSUE.

We carry directors' and officers' liability insurance covering losses up to
$3,000,000 (subject to certain deductible amounts).

LEGAL OPINIONS

The law firm of Jackson & Campbell, P.C., our counsel, 1120 20th Street,
N.W., South Tower, Washington, D.C. 20036, has rendered an opinion regarding the
validity of the Shares offered hereby.

EXPERTS

The consolidated financial statements included in our Annual Report on
Form 10-KSB for the fiscal year ended June 30, 2001, as amended, which are
incorporated by reference in this Prospectus, have been audited by BDO Seidman,
LLP, independent certified public accountants, a member firm of BDO
International ("BDO Seidman"), to the extent and for the periods set forth in
their report incorporated herein by reference, and are incorporated herein in
reliance upon such report given upon the authority of said firm as experts in
auditing and accounting.

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

NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION
OR TO MAKE ANY REPRESENTATIONS ON BEHALF OF THE COMPANY NOT CONTAINED IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER OF ANY SECURITIES OTHER THAN THOSE TO WHICH IT RELATES
OR AN OFFER TO SELL, OR THE SOLICITATION OF AN OFFER TO BUY, ANY SECURITIES IN
ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM, IT IS UNLAWFUL TO MAKE SUCH
OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.

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

TABLE OF CONTENTS

PAGE
--------

CELLPOINT INC......................... 1

FORWARD-LOOKING STATEMENTS............ 2

WHERE YOU CAN FIND MORE INFORMATION
ABOUT US............................ 3

INCORPORATION OF INFORMATION WE FILE
WITH THE SEC........................ 3

SUMMARY INFORMATION................... 3

RISK FACTORS.......................... 5

USE OF PROCEEDS....................... 8

BUSINESS.............................. 18

DESCRIPTION OF SECURITIES............. 18

THE SELLING STOCKHOLDERS.............. 26

PLAN OF DISTRIBUTION.................. 29

INDEMNIFICATION....................... 33

LEGAL OPINIONS........................ 34

EXPERTS............................... 34

10,384,540 SHARES
OF
COMMON STOCK

CELLPOINT INC.

COMMON STOCK

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

PROSPECTUS
---------------------

OCTOBER -, 2001

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

PART II

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

Registration Fees........................................... $ 4,236.34
Transfer Agent Fees......................................... 1,000
Blue Sky Filing Fees........................................ 1,500
Printing and Mailing........................................ 25,000
Legal Fees.................................................. 30,000
Accounting Fees............................................. 25,000
Listing Fees................................................ 17,500
Other....................................................... 5,000
-----------
Total....................................................... $ 109,236
===========

ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS

The Company shall, to the fullest extent permitted by Section 78.7502 of the
Corporation Law of the State of Nevada, as the same may be amended and
supplemented, indemnify under said section any director, officer, employee or
agent from and against any and all expenses, liabilities or other matters
referred in or covered by said section, and the indemnification provided for
herein shall not be deemed exclusive of any other rights to which those
indemnified may be entitled under any By-Law, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office, and shall
continue as to a person who has ceased to be a director, officer, employee or
agent and shall inure to the benefit of the heirs, executors and administrators
of such a person. The Company will have the power to purchase and maintain
officers' and directors' liability insurance in order to insure against the
liabilities for which such officers and directors are indemnified pursuant to
its By-Laws.

ITEM 16. EXHIBITS

The following Exhibits are filed as part of this Registration Statement:

EXHIBIT NO. DESCRIPTION OF EXHIBIT
--------------------- ------------------------------------------------------------

4.1 Registration Rights Agreement, dated as of February 29,
2000, by and among CellPoint Inc., CellPoint Swedish
Holdings Ltd., and the Sellers named therein (incorporated
by reference to the Company's Current Report on Form 8-K,
filed on March 13, 2000, as amended by Form 8-K/A, filed on
May 15, 2000).

4.2 Securities Purchase Agreement, dated as of December 6, 2000,
by and among CellPoint Inc. and the Purchaser set forth
therein (incorporated by reference to the Company's Current
Report on Form 8-K, filed on December 12, 2000).

4.3 Registration Rights Agreement, dated as of December 6, 2000,
by and among CellPoint Inc. and the Initial Investor (as
such term is defined therein) (incorporated by reference to
the Company's Current Report on Form 8-K, filed on
December 12, 2000).

4.4 Convertible Note of CellPoint Inc., dated December 6, 2000,
payable to the order of Castle Creek Technology Partners
LLC, in the aggregate principal amount of $10,000,000
(incorporated by reference to the Company's Current Report
on Form 8-K, filed on December 12, 2000).

II-1

EXHIBIT NO. DESCRIPTION OF EXHIBIT
--------------------- ------------------------------------------------------------

4.5 Stock Purchase Warrant of CellPoint Inc., dated December 6,
2000, with respect to the right of Castle Creek Technology
Partners LLC (incorporated by reference to the Company's
Current Report on Form 8-K, filed on December 12, 2000).

4.6 Stock Purchase Warrant of CellPoint Inc., dated July 25,
2001, with respect to the right of Castle Creek Technology
Partners LLC (incorporated by reference to the Company's
Current Report on Form 8-K, filed on July 31, 2001).

4.7 Form of Stock Purchase Warrant (filed herewith)

5.1 Opinion of Jackson & Campbell, P.C. (filed herewith).

10.1 Share and Asset Transfer Agreement, dated October 19, 2001,
between Micronet AB and CellPoint Systems AB (filed
herewith).

23.1 Consent of Independent Accountants (filed herewith)

23.2 Consent of Jackson & Campbell, P.C. (included in their
opinion filed as exhibit 5.1)

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes:

1. To file, during any period in which offers or sales are being made, a
post-effective amendment to the registration statement: to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement.

2. That, for the purpose of determining any liability under the Securities Act
of 1933, as amended (the "Act"), each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.

3. To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of
the offering.

INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING UNDER THE ACT MAY BE
PERMITTED TO DIRECTORS, OFFICERS AND CONTROLLING PERSONS OF THE REGISTRANT
PURSUANT TO THE FOREGOING PROVISIONS, OR OTHERWISE, THE REGISTRANT HAS BEEN
ADVISED THAT IN THE OPINION OF THE SECURITIES AND EXCHANGE COMMISSION SUCH
INDEMNIFICATION IS AGAINST PUBLIC POLICY AS EXPRESSED IN THE ACT AND IS,
THEREFORE, UNENFORCEABLE. IN THE EVENT THAT A CLAIM FOR INDEMNIFICATION AGAINST
SUCH 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 SUCH
DIRECTOR, OFFICER OR CONTROLLING PERSON IN CONNECTION WITH THE SECURITIES BEING
REGISTERED, THE REGISTRANT WILL, UNLESS IN THE OPINION OF ITS COUNSEL THE MATTER
HAS BEEN SETTLED BY CONTROLLING PRECEDENT, SUBMIT TO A COURT OF APPROPRIATE
JURISDICTION THE QUESTION WHETHER SUCH INDEMNIFICATION BY IT IS AGAINST PUBLIC
POLICY AS EXPRESSED IN THE ACT AND WILL BE GOVERNED BY THE FINAL ADJUDICATION OF
SUCH ISSUE.

The Company carries directors' and officers' liability insurance covering
losses up to $3,000,000 (subject to certain deductible amounts).

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SIGNATURES

In accordance with 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 authorized this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly, authorized, in the City of London, England, on October 31, 2001.

CELLPOINT INC.

October 31, 2001 By: /s/ PETER HENRICSSON
-----------------------------------------------
Peter Henricsson
PRESIDENT AND CHIEF EXECUTIVE OFFICER
(PRINCIPAL EXECUTIVE OFFICER)

October 31, 2001 By: /s/ LARS WADELL
-----------------------------------------------
Lars Wadell
CHIEF FINANCIAL OFFICER

In accordance with the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.

SIGNATURE TITLE DATE
--------- ----- ----

------------------------------------------- Director
Stephen T. Childs

/s/ LYNN DUPLESSIS
------------------------------------------- Director October 31, 2001
Lynn Duplessis

/s/ PETER HENRICSSON
------------------------------------------- Director October 31, 2001
Peter Henricsson

/s/ MATS JONNERHAG
------------------------------------------- Director October 31, 2001
Mats Jonnerhag

------------------------------------------- Director
Bengt Nordstrom

/s/ LARS PERSSON
------------------------------------------- Director October 31, 2001
Lars Persson

-------------------------------------------
Jan Rynning Director

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