I found a workaround. I have installed the package "comgt". 
If I plug in the modem, let it settle, then run comgt in a command line, it asks for the PIN and it registers in the network (also switches the LED from red to blue) 
then if i restart networmanager (and wait for ~30seconds) I can enable the mobile broadband and connect using the network manager applet. 

smiki@smiki-AOD257:/var/log$ comgt
Trying list of devices

Enter PIN number: XXXX
Waiting for Registration..(120 sec max)..
Registered on Home network: 
Failed to register
smiki@smiki-AOD257:/var/log$ sudo /etc/init.d/modemmanager restart
Rather than invoking init scripts through /etc/init.d, use the service(8)
utility, e.g. service modemmanager restart

Since the script you are attempting to invoke has been converted to an
Upstart job, you may also use the stop(8) and then start(8) utilities,
e.g. stop modemmanager ; start modemmanager. The restart(8) utility is also available.
modemmanager stop/waiting
modemmanager start/running, process 11425
smiki@smiki-AOD257:/var/log$

syslog output after modemmanager restart (the comgt does not spit out anything to the logs):

Jan  4 20:40:41 smiki-AOD257 modem-manager[11327]: <info>  Caught signal 15, shutting down...
Jan  4 20:40:41 smiki-AOD257 modem-manager[11327]: marshal_object: assertion `g_variant_is_object_path (path)' failed
Jan  4 20:40:41 smiki-AOD257 modem-manager[11327]: failed to marshal parameter 1 for signal DeviceRemoved
Jan  4 20:40:41 smiki-AOD257 NetworkManager[677]: <info> the modem manager disappeared
Jan  4 20:40:41 smiki-AOD257 NetworkManager[677]: <info> trying to start the modem manager...
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  ModemManager (version 0.5) starting...
Jan  4 20:40:41 smiki-AOD257 dbus[625]: [system] Activating service name='org.freedesktop.ModemManager' (using servicehelper)
Jan  4 20:40:41 smiki-AOD257 modem-manager[11427]: <info>  ModemManager (version 0.5) starting...
Jan  4 20:40:41 smiki-AOD257 dbus[625]: [system] Successfully activated service 'org.freedesktop.ModemManager'
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Longcheer
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin MotoC
Jan  4 20:40:41 smiki-AOD257 NetworkManager[677]: <info> modem-manager is now available
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin X22X
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Option High-Speed
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Novatel
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Sierra
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Option
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Nokia
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Generic
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Ericsson MBM
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin ZTE
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Samsung
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin SimTech
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Linktop
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin AnyData
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Gobi
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Wavecom
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  Loaded plugin Huawei
Jan  4 20:40:41 smiki-AOD257 modem-manager[11427]: <warn>  Could not acquire the org.freedesktop.ModemManager service as it is already taken. Return: 3
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB0) opening serial port...
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB1) opening serial port...
Jan  4 20:40:41 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB2) opening serial port...
Jan  4 20:40:56 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB2) closing serial port...
Jan  4 20:40:56 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB2) serial port closed
Jan  4 20:40:56 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB2) opening serial port...
Jan  4 20:40:56 smiki-AOD257 modem-manager[11425]: <info>  (ZTE): GSM modem /sys/devices/pci0000:00/0000:00:1d.7/usb1/1-4 claimed port ttyUSB2
Jan  4 20:40:57 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB2) closing serial port...
Jan  4 20:40:57 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB2) serial port closed
Jan  4 20:41:01 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB1) closing serial port...
Jan  4 20:41:01 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB1) serial port closed
Jan  4 20:41:01 smiki-AOD257 modem-manager[11425]: <info>  (ZTE): GSM modem /sys/devices/pci0000:00/0000:00:1d.7/usb1/1-4 claimed port ttyUSB1
Jan  4 20:41:14 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB0) closing serial port...
Jan  4 20:41:14 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB0) serial port closed
Jan  4 20:41:14 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB0) opening serial port...
Jan  4 20:41:17 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB0) closing serial port...
Jan  4 20:41:17 smiki-AOD257 modem-manager[11425]: <info>  (ttyUSB0) serial port closed
Jan  4 20:41:17 smiki-AOD257 modem-manager[11425]: <info>  (ZTE): GSM modem /sys/devices/pci0000:00/0000:00:1d.7/usb1/1-4 claimed port ttyUSB0
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: <warn> (ttyUSB2): failed to look up interface index
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: <info> WWAN now disabled by management service
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: <info> (ttyUSB2): new GSM/UMTS device (driver: 'option1' ifindex: 0)
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: <info> (ttyUSB2): exported as /org/freedesktop/NetworkManager/Devices/3
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: <info> (ttyUSB2): now managed
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: <info> (ttyUSB2): device state change: unmanaged -> unavailable (reason 'managed') [10 20 2]
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: <info> (ttyUSB2): deactivating device (reason 'managed') [2]
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: nm_system_iface_flush_routes: assertion `ifindex > 0' failed
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: nm_system_iface_flush_addresses: assertion `ifindex > 0' failed
Jan  4 20:41:17 smiki-AOD257 NetworkManager[677]: <info> (ttyUSB2): device state change: unavailable -> disconnected (reason 'none') [20 30 0]