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<SEC-DOCUMENT>0000944075-09-000038.txt : 20090707
<SEC-HEADER>0000944075-09-000038.hdr.sgml : 20090707
<ACCEPTANCE-DATETIME>20090707163839
ACCESSION NUMBER:		0000944075-09-000038
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20090630
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Other Events
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20090707
DATE AS OF CHANGE:		20090707

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			SOCKET MOBILE, INC.
		CENTRAL INDEX KEY:			0000944075
		STANDARD INDUSTRIAL CLASSIFICATION:	ELECTRONIC COMPUTERS [3571]
		IRS NUMBER:				943155066
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-25904
		FILM NUMBER:		09933621

	BUSINESS ADDRESS:	
		STREET 1:		39700 EUREKA DRIVE
		CITY:			NEWARK
		STATE:			CA
		ZIP:			94560-4808
		BUSINESS PHONE:		5109333000

	MAIL ADDRESS:	
		STREET 1:		39700 EUREKA DRIVE
		CITY:			NEWARK
		STATE:			CA
		ZIP:			94560-4808

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	SOCKET COMMUNICATIONS INC
		DATE OF NAME CHANGE:	19950418
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>form-8k0707.htm
<DESCRIPTION>8-K
<TEXT>
<html>
<head>

</head>

<body bgcolor="#FFFFFF">
<div align=left>
  <hr width="100%">
  <div align=center>
    <hr width="100%">
    <p><font face="Times New Roman, Times, serif" size="3"><b><font size="5">UNITED
      STATES<br>
      </font></b><font size="5"><strong>SECURITIES AND EXCHANGE COMMISSION</strong></font></font></p>
  </div>
</div>
<p align=center><font face="Times New Roman, Times, serif" size="3">Washington,
  DC 20549</font></p>
<p align=center><font face="Times New Roman, Times, serif" size="3">__________________________</font></p>
<p align=center><font face="Times New Roman, Times, serif" size="3"> <b><font size="5">FORM
  8-K</font></b><br>
  <br>
  <b>CURRENT REPORT</b><br>
  <br>
  <b>Pursuant to Section 13 or 15(d) of<br>
  The Securities Exchange Act of 1934</b><br>
  <b><br>
  </b></font><font face="Times New Roman, Times, serif"><font size=3><font size="2">Date
  of Report</font> <font size="2">(Date of earliest event reported)</font></font></font><font face="Times New Roman, Times, serif" size="3"><b>
  </b></font></p>
<p align=center><font face="Times New Roman, Times, serif" size="3"><b>June 30</b></font><font face="Times New Roman, Times, serif"><b><font size=3>,
  2009</font></b><font size=3><br>
  </font></font></p>
<p align=center><font face="Times New Roman, Times, serif" size="3">__________________________<br>
  </font></p>
<p align=center><font face="Times New Roman, Times, serif" size="5"><strong>SOCKET
  MOBILE, INC.</strong></font><font face="Times New Roman, Times, serif"><br>
  <font size=2>(Exact name of registrant as specified in its charter) </font></font></p>
<p>&nbsp;
<table cols=3 width="100%">
  <tr>
    <td height=28 width="34%">
      <center>
        <font face="Times New Roman, Times, serif" size=3><b>Delaware<br>
        </b></font><font face="Times New Roman, Times, serif" size=2>(State or
        other jurisdiction of incorporation)</font><font face="Times New Roman, Times, serif" size=3><b>
        </b> </font>
      </center>
    </td>
    <td height=28 width="32%">
      <center>
        <font face="Times New Roman, Times, serif" size=3><b>001-13810<br>
        </b></font><font face="Times New Roman, Times, serif" size=2>(Commission
        File Number)</font><font face="Times New Roman, Times, serif" size=3><b>
        </b></font>
      </center>
    </td>
    <td height=28 width="34%">
      <center>
        <font face="Times New Roman, Times, serif" size=3><b>94-3155066</b><br>
        </font><font face="Times New Roman, Times, serif" size=2>(IRS Employer
        Identification No.)</font><font face="Times New Roman, Times, serif" size=3>
        </font>
      </center>
    </td>
  </tr>
</table>
<font face="Times New Roman, Times, serif"><br>
</font>
<p align=center><font face="Times New Roman, Times, serif" size="3"><b>39700 Eureka
  Drive <br>
  Newark, CA 94560</b></font><font face="Times New Roman, Times, serif"><br>
  <font size=2>(Address of principal executive offices, including zip code) </font></font></p>
<p align=center><font face="Times New Roman, Times, serif" size="3"><b>(510) 933-3000<br>
  </b></font> <font face="Times New Roman, Times, serif"><font size="2">(Registrant's
  telephone number, including area code)</font></font>
<div align="center">
  <p>&nbsp;</p>
  <p align="left">Check the appropriate box below if the Form 8-K filing is intended
    to simultaneously satisfy the filing obligation of the registrant under any
    of the following provisions (see General Instruction A.2. below):</p>
  <p align="left"><font face="Times New Roman, Times, serif"><font size="3">[
    ] Written communications pursuant to Rule 425 under the Securities Act (17
    CFR 230.425)</font></font></p>
  <p align="left"><font face="Times New Roman, Times, serif"><font size="3">[
    ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
    240.14a-12)</font></font></p>
  <p align="left"><font face="Times New Roman, Times, serif"><font size="3">[
    ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
    Act (17 CFR 240.14d-2(b))</font></font></p>
  <p align="left"><font face="Times New Roman, Times, serif"><font size="3">[
    ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
    Act (17 CFR 240.13e-4(c))<br>
    <br>
    </font></font></p>
</div>
<p style="PAGE-BREAK-BEFORE: always"> </p>
<div align=left></div>
<div align=left>
  <hr width="100%">
  <div align=center>
    <hr width="100%">
  </div>
</div>
<p><br>
  <font face="Times New Roman, Times, serif"><b><br>
  Item 1.01 Entry into Material Definitive Agreements</b><br>
  </font></p>
<p>Item 8.01 below is incorporated by reference herein in its entirety. </p>
<p><b>Item 8.01 Other Events</b></p>
<p> On July 7, 2009, Socket Mobile, Inc. (the &quot;Company&quot;) and Silicon
  Valley Bank (the &quot;Lender&quot;) amended the Second Amended and Restated
  Loan and Security Agreement, dated as of December 24, 2008 between the Company
  and the Lender, as amended, and the Second Amended and Restated Export-Import
  Bank Loan and Security Agreement, dated as of December 24, 2008, between the
  Company and the Lender, as amended (together the &quot;Loan Agreements&quot;).
  The original loan agreement transaction was reported on Form 8-K dated December
  31, 2008 and filed on January 7, 2009. <br>
</p>
<p>On February 23, 2009, the Company reported an amendment effective as of February
  19, 2009 to extend the expiration date of the Loan Agreements to March 24, 2010,
  to reallocate the borrowing limits to $1.5 million for the domestic line and
  $1.0 million for the international line, and to revise financial covenants based
  on an adjusted quick ratio measured monthly. <br>
</p>
<p>On June 4, 2009, the Company reported that its financial statements as of the
  end of April 2009 filed with the Lender on May 29, 2009 did not meet the adjusted
  quick ratio target and that it was out of compliance with the Loan Agreements.
  The Company also reported that the Lender agreed to waive the Company's non-compliance
  with respect to the adjusted quick ratio covenant for the month of April. </p>
<p>On June 30, 2009, the Company filed its financial statements as of the end
  of May with the Lender. The financial statements as of the end of May did not
  meet the adjusted quick ratio target and the Company was out of compliance with
  the Loan Agreements. On July 7, 2009, the Company and the Lender amended the
  Loan Agreements (the &quot;Amendments&quot;) to:</p>
<blockquote>
  <p>1. Waive the events of non-compliance with respect to the adjusted quick
    ratio covenant for the months of April and May and, if necessary, for the
    month of June.</p>
  <p>2. Replace the adjusted quick ratio covenant with a requirement that, beginning
    June 1, 2009, the Company:</p>
  <blockquote>
    <p>(a) maintain at all times a minimum balance of unrestricted cash and cash
      equivalents of no less than $1,000,000; and </p>
    <p>(b) maintain minimum revenues of $4,068,000 during the fiscal quarter ended
      June 30, 2009, $4,500,000 during the fiscal quarter ending September 30,
      2009, and $5,355,000 during the fiscal quarter ending December 31, 2009.</p>
  </blockquote>
  <p>3. Reduce the advance rate for receivables from distributors from 60% to
    50% and from 80% to 70% for all other receivables.</p>
  <p>4. Change the collateral handling fee from 0.7% to 0.62% per month.</p>
  <p>&nbsp;</p>
</blockquote>
<hr width="100%">
<p><br>
  The foregoing description of the Amendments does not purport to be complete
  and is qualified in its entirety to reference to the full text of the Amendments,
  copies of which are attached hereto as Exhibit 10.1 and Exhibit 10.2 and are
  incorporated herein by reference. </p>
<p><font face="Times New Roman, Times, serif"><b>Item 9.01 Financial Statements
  and Exhibits</b><br>
  </font></p>
<p><font face="Times New Roman, Times, serif"><b>(d) Exhibits.</b></font></p>
<table cellspacing=0 cellpadding=0 width="100%" align=left border=0>
  <tr valign=bottom>
    <td align="left" height="54" width="10%" style="border-bottom: 1px solid #000000" class="border">
      <div style="margin-left: 10px; text-indent: -10px">
        <div align="center" class="border"><font face="Times New Roman, Times, serif">Exhibit
          Number</font></div>
      </div>
    </td>
    <td width=2% height=54><font face="Times New Roman, Times, serif"></font></td>
    <td align="left" height="54" width="88%" style="border-bottom: 1px solid #000000" class="border">
      <div style="margin-left: 10px; text-indent: -10px">
        <div class="border">
          <div align="center"><font face="Times New Roman, Times, serif">Description</font></div>
        </div>
      </div>
    </td>
  </tr>
  <tr valign=top>
    <td width=10% height="22">&nbsp;</td>
    <td width=2% height="22">&nbsp;</td>
    <td width=88% height="22">&nbsp;</td>
  </tr>
  <tr valign=top>
    <td width=10% height="22">
      <div align=center><font face="Times New Roman, Times, serif">10.1</font></div>
    </td>
    <td width=2% height="22"><font face="Times New Roman, Times, serif"></font></td>
    <td width=88% height="22">Second Amendment to Second Amended and Restated
      Loan and Security Agreement, dated July 7, 2009, by and between Socket Mobile,
      Inc. and Silicon Valley Bank.</td>
  </tr>
  <tr valign=top>
    <td width=10% height="22">
      <div align=center><font face="Times New Roman, Times, serif">10.2</font></div>
    </td>
    <td width=2% height="22"><font face="Times New Roman, Times, serif"></font></td>
    <td width=88% height="22">Second Amendment to Second Amended and Restated
      Export-Import Bank Loan and Security Agreement, dated July 7, 2009 by and
      between Socket Mobile, Inc. and Silicon Valley Bank. </td>
  </tr>
</table>
<p>&nbsp;</p>
<p>&nbsp;</p>
<hr>
<p><font face="Times New Roman, Times, serif"><br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  <br>
  </font></p>
<p align="center"><br>
</p>
<hr width="100%">
<p align="center">&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif"><b>SIGNATURES</b><br>
  </font></p>
<p>Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant
  has duly caused this report to be signed on its behalf by the undersigned hereunto
  duly authorized.<br>
  <br>
</p>
<dir>
  <dir>
    <dir>
      <dir>
        <dir>
          <blockquote>
            <tr>
              <td>&nbsp;</td>
              <td>&nbsp;</td>
            </tr>
            <tr>
              <td>&nbsp;</td>
              <td>&nbsp;</td>
            </tr>
            <tr>
              <td>&nbsp;</td>
              <td>&nbsp;</td>
            </tr>
            <tr>
              <td>&nbsp;</td>
              <td>&nbsp;</td>
            </tr>
            <tr>
              <td>&nbsp;</td>
              <td>&nbsp;</td>
            </tr>
            <tr>
              <td>&nbsp;</td>
              <td>&nbsp;</td>
            </tr>
            <tr>
              <td>&nbsp;</td>
              <td>&nbsp;</td>
            </tr>
            <tr>
              <td>&nbsp;</td>
              <td>&nbsp;</td>
            </tr>
            <p align=left> </p>
            <tr valign="bottom"
align="left"></tr>
          </blockquote>
        </dir>
      </dir>
    </dir>
  </dir>
</dir>
<div align=left>
  <table height=135 cellspacing=0 cellpadding=0 width=96% align=left border=0>
    <tr>
      <td width=300>&nbsp;</td>
      <td width=21>&nbsp;</td>
      <td colspan="2"><font face="Times New Roman, Times, serif"><b>SOCKET MOBILE,
        INC.</b></font></td>
    </tr>
    <tr>
      <td width=300>&nbsp;</td>
      <td width=21>&nbsp;</td>
      <td colspan="2">&nbsp;</td>
    </tr>
    <tr>
      <td width=300>
        <div align=left></div>
      </td>
      <td width=21>&nbsp;</td>
      <td colspan="2">&nbsp;</td>
    </tr>
    <tr>
      <td width=300 height=19>
        <div align=left><font face="Times New Roman, Times, serif">Date: July
          7, 2009</font></div>
      </td>
      <td width=21 height=19>&nbsp;</td>
      <td width=30 height=19><font face="Times New Roman, Times, serif">By: <u>/s/
        </u></font></td>
      <td width=379 height=19><font face="Times New Roman, Times, serif"><u>David
        W. Dunlap</u></font></td>
    </tr>
    <tr>
      <td width=300 height=40>
        <div align=left></div>
      </td>
      <td width=21 height=40>&nbsp;</td>
      <td width=30 height=40>
        <blockquote>
          <div align="left"></div>
        </blockquote>
      </td>
      <td width=379 height=40><font face="Times New Roman, Times, serif">David
        W. Dunlap<br>
        Vice President, Finance and Administration <br>
        and Chief Financial Officer</font></td>
    </tr>
  </table>
</div>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p><br>
  <br>
  <br>
  <br>
  <br>
  <br>
</p>
<p align="center">&nbsp;</p>
<hr>
<p>&nbsp;</p>
<p align="center"><b>EXHIBIT INDEX</b></p>
<table cellspacing=0 cellpadding=0 width="100%" align=left border=0>
  <tr valign=bottom>
    <td align="left" height="54" width="10%" style="border-bottom: 1px solid #000000" class="border">
      <div style="margin-left: 10px; text-indent: -10px">
        <div align="center" class="border"><font face="Times New Roman, Times, serif">Exhibit
          Number</font></div>
      </div>
    </td>
    <td width=2% height=54><font face="Times New Roman, Times, serif"></font></td>
    <td align="left" height="54" width="88%" style="border-bottom: 1px solid #000000" class="border">
      <div style="margin-left: 10px; text-indent: -10px">
        <div class="border">
          <div align="center"><font face="Times New Roman, Times, serif">Description</font></div>
        </div>
      </div>
    </td>
  </tr>
  <tr valign=top>
    <td width=10% height="22">&nbsp;</td>
    <td width=2% height="22">&nbsp;</td>
    <td width=88% height="22">&nbsp;</td>
  </tr>
  <tr valign=top>
    <td width=10% height="22">
      <div align=center><font face="Times New Roman, Times, serif">10.1</font></div>
    </td>
    <td width=2% height="22"><font face="Times New Roman, Times, serif"></font></td>
    <td width=88% height="22">Second Amendment to Second Amended and Restated
      Loan and Security Agreement, dated July 7, 2009, by and between Socket Mobile,
      Inc. and Silicon Valley Bank.</td>
  </tr>
  <tr valign=top>
    <td width=10% height="22">
      <div align=center><font face="Times New Roman, Times, serif">10.2</font></div>
    </td>
    <td width=2% height="22"><font face="Times New Roman, Times, serif"></font></td>
    <td width=88% height="22">Second Amendment to Second Amended and Restated
      Export-Import Bank Loan and Security Agreement, dated July 7, 2009 by and
      between Socket Mobile, Inc. and Silicon Valley Bank. </td>
  </tr>
</table>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center">&nbsp;</p>
<hr>
</body>
</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>ex101.htm
<DESCRIPTION>EXHIBIT 10.1
<TEXT>
<html>
<head>
<title>Untitled Document</title>
</head>

<body bgcolor="#FFFFFF">
<p align="right"><font face="Times New Roman, Times, serif" size="3"><b>Exhibit
  10.1</b></font></p>
<p align="center"><font face="Times New Roman, Times, serif" size="3"><br>
  </font></p>
<p align="center"><font face="Times New Roman, Times, serif" size="3"><b>SECOND
  AMENDMENT TO SECOND AMENDED AND RESTATED<u><br>
  LOAN AND SECURITY AGREEMENT</u></b><br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><br>
  THIS SECOND AMENDMENT AMENDMENT TO SECOND AMENDED AND RESTATED LOAN AND SECURITY
  AGREEMENT (this &quot;Amendment&quot;) is entered into this 7th day of July,
  2009, by and between SILICON VALLEY BANK (&quot;Bank&quot;) and SOCKET MOBILE,
  INC., a Delaware corporation (&quot;Borrower&quot;), whose address is 39700
  Eureka Drive, Newark, California 94560.<br>
  </font></p>
<p align="center"><font face="Times New Roman, Times, serif" size="3"><b>RECITALS</b><br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><b>A</b>. Bank and Borrower
  have entered into that certain Second Amended and Restated Loan and Security
  Agreement dated as of December 24, 2008 (as the same has been amended, modified,
  supplemented or restated, the &quot;Loan Agreement&quot;).<br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><b>B</b>. Bank has extended
  credit to Borrower for the purposes permitted in the Loan Agreement.<br>
  </font></p>
<p><font size="3" face="Times New Roman, Times, serif"><b>C</b>. Borrower is currently
  in violation of the Loan Agreement for failing to comply with the Adjusted Quick
  Ratio covenant set forth in Section 6.6 of the Loan Agreement (the &quot;Adjusted
  Quick Ratio Covenant&quot;) for the months ended April 30, 2009 and May 31,
  2009 and anticipates being in violation of the Adjusted Quick Ratio Covenant
  as of June 30, 2009, each of which, if not waived by Bank, would constitute
  an Event of Default.</font></p>
<p><font size="3" face="Times New Roman, Times, serif"><b>D</b>. Borrower has
  requested that Bank waive the Adjusted Quick Ratio Covenant for the months ended
  April 30, 2009, May 31, 2009 and June 30, 2009. Although Bank is under no obligation
  to do so, Bank is willing to waive the Adjusted Quick Ratio Covenant for the
  months ended April 30, 2009, May 31, 2009 and June 30, 2009 and amend certain
  provisions of the Loan Agreement, all on the terms and conditions set forth
  in this Amendment, so long as Borrower complies with the terms, covenants and
  conditions set forth in this Amendment in a timely manner.</font></p>
<p align="center"><font face="Times New Roman, Times, serif" size="3"><b>AGREEMENT</b></font></p>
<p><font size="3" face="Times New Roman, Times, serif"><b>NOW, THEREFORE</b>,
  in consideration of the foregoing recitals and other good and valuable consideration,
  the receipt and adequacy of which is hereby acknowledged, and intending to be
  legally bound, the parties hereto agree as follows:<br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><b>1. Definitions. </b>Capitalized
  terms used but not defined in this Amendment shall have the meanings given to
  them in the Loan Agreement. </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><b>2. Amendments to Loan
  Agreement.</b><br>
  </font></p>
<blockquote>
  <p><font face="Times New Roman, Times, serif" size="3"><b>2.1 Waiver of Adjusted
    Quick Ratio Covenant</b>. Bank hereby waives the Adjusted Quick Ratio Covenant
    for the months ended April 30, 2009, May 31, 2009 and June 30, 2009. Bank's
    agreement to waive the Adjusted Quick Ratio Covenant for the months ended
    April 30, 2009, May 31, 2009 and June 30, 2009 shall in no way obligate Bank
    to make any other modifications to the Loan Agreement or to waive Borrower's
    compliance with any other terms of the Loan Documents, and shall not limit
    or impair Bank's right to demand strict performance of all other terms and
    covenants as of any date. The waiver set forth above shall not be deemed or
    otherwise construed to constitute a waiver of any other provisions of the
    Loan Agreement in connection with any other transaction. </font></p>
</blockquote>
<p><font face="Times New Roman, Times, serif" size="3"><br>
  </font></p>
<p align="center"><font face="Times New Roman, Times, serif" size="3">1</font></p>
<hr>
<blockquote>
  <p><font face="Times New Roman, Times, serif" size="3"><b><br>
    2.2</b> <b>Section 2.2.3 (Grant of Security Interest)</b>. The last two sentences
    of Section 2.2.3 of the Loan Agreement are hereby amended by deleting them
    in their entirety and replacing them with the following:</font></p>
  <p><font size="3" face="Times New Roman, Times, serif">Because the Advance Rate
    may differ based on the type of Eligible Account, the Bank will from time
    to time, adjust the Finance Charge on Advances made at an Advance Rate of
    50% so that the effective Finance Charge on such Advances is reasonably equivalent
    to the Finance Charge which applies to Advances based on an 70% Advance Rate.
    After an Event of Default, the Applicable Rate will increase an additional
    5.00% per annum effective immediately upon the occurrence of such Event of
    Default.</font></p>
  <p><font size="3" face="Times New Roman, Times, serif"><b>2.3 Section 2.2.4
    (Collateral Handling Fee)</b>. The first sentence of Section 2.2.4 of the
    Loan Agreement is hereby amended by deleting it in its entirety and replacing
    it with the following:</font></p>
  <p><font size="3" face="Times New Roman, Times, serif">Borrower will pay to
    Bank a collateral handling fee equal to 0.62% per month of the Financed Receivable
    Balance for each Financed Receivable outstanding based upon a 360 day year
    (the &quot;<b>Collateral Handling Fee</b>&quot;).</font></p>
  <p><font size="3" face="Times New Roman, Times, serif"><b>2.4 Section 6.2 (Financial
    Statements, Reports, Certificates)</b>. Section 6.2(g) is hereby added to
    the Loan Agreement immediately after Section 6.2(f) of the Loan Agreement
    as follows:</font></p>
  <blockquote>
    <blockquote>
      <p><font size="3" face="Times New Roman, Times, serif">(g) Provide Bank
        with, as soon as available, but no later than thirty (30) days following
        each Reconciliation Period, distributor sell-through reports, in form
        acceptable to Bank.</font></p>
    </blockquote>
  </blockquote>
  <p><font size="3" face="Times New Roman, Times, serif"><b>2.5 Section 6.6 (Financial
    Covenants)</b>. Section 6.6 of the Loan Agreement is hereby amended by deleting
    it in its entirety and replacing it with the following:</font></p>
  <p><font size="3" face="Times New Roman, Times, serif"><b>6.6 <u>Financial Covenants</u></b>.
    Commencing June 1, 2009, Borrower shall maintain at all times:</font></p>
  <blockquote>
    <blockquote>
      <p><font size="3" face="Times New Roman, Times, serif">(a) <u>Minimum Cash</u>.
        Unrestricted cash and Cash Equivalents at Bank of not less than One Million
        Dollars ($1,000,000).</font></p>
      <p><font size="3" face="Times New Roman, Times, serif">(b) <u>Minimum Revenue</u>.
        Revenue of not less than the following amounts during following fiscal
        quarters:</font></p>
      <table width="70%" border="1" cellspacing="0" cellpadding="0">
        <tr>
          <td><font face="Times New Roman, Times, serif"><b><u>Quarter Ending</u></b></font></td>
          <td>
            <div align="center"><font face="Times New Roman, Times, serif"><b><u>Minimum
              Revenue</u></b></font></div>
          </td>
        </tr>
        <tr>
          <td><font face="Times New Roman, Times, serif">April 1, 2009 through
            June 30, 2009</font></td>
          <td>
            <div align="center"><font face="Times New Roman, Times, serif">$4,068,000</font></div>
          </td>
        </tr>
        <tr>
          <td><font face="Times New Roman, Times, serif">July 1, 2009 through
            September 30, 2009</font></td>
          <td>
            <div align="center"><font face="Times New Roman, Times, serif">$4,500,000</font></div>
          </td>
        </tr>
        <tr>
          <td><font face="Times New Roman, Times, serif">October 1, 2009 through
            December 31, 2009 and for each quarter thereafter</font></td>
          <td align="left" valign="top">
            <div align="center"><font face="Times New Roman, Times, serif">$5,355,000</font></div>
          </td>
        </tr>
      </table>
      <p>&nbsp;</p>
      <p>&nbsp;</p>
    </blockquote>
  </blockquote>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif" size="3">2</font></p>
<hr>
<font size="3" face="Times New Roman, Times, serif"><br>
</font>
<blockquote>
  <p><font face="Times New Roman, Times, serif" size="3"><b>2.6 Section 13 (Definitions)</b>.
    The following term and its definition set forth in Section 13.1 of the Loan
    Agreement is amended in its entirety and replaced with the following:</font></p>
  <p><font size="3" face="Times New Roman, Times, serif">&quot;<b>Advance Rate</b>&quot;
    is 70%, net of any offsets related to each specific Account Debtor, provided,
    however, that with respect to any Account Debtor which is a distributor, the
    Advance Rate shall be 50%.</font></p>
  <p><font face="Times New Roman, Times, serif" size="3"><b>2.7 Compliance Certificate</b>.
    <u>Exhibit B</u> of the Loan Agreement is replaced in its entirety with Exhibit
    B attached hereto. From and after the date of this Amendment, all references
    in the Loan Agreement, to the Compliance Certificate shall be deemed to refer
    to <u>Exhibit B</u>.</font></p>
</blockquote>
<p><font face="Times New Roman, Times, serif" size="3"><b>3. Limitation of Amendments.</b></font></p>
<blockquote>
  <p><font face="Times New Roman, Times, serif" size="3"><b>3.1</b> The amendments
    set forth in <b>Section 2</b>, above, are effective for the purposes set forth
    herein and shall be limited precisely as written and shall not be deemed to
    (a) be a consent to any amendment, waiver or modification of any other term
    or condition of any Loan Document, or (b) otherwise prejudice any right or
    remedy which Bank may now have or may have in the future under or in connection
    with any Loan Document.</font></p>
  <p><font face="Times New Roman, Times, serif" size="3"><b>3.2</b> This Amendment
    shall be construed in connection with and as part of the Loan Documents and
    all terms, conditions, representations, warranties, covenants and agreements
    set forth in the Loan Documents, except as herein amended, are hereby ratified
    and confirmed and shall remain in full force and effect.</font></p>
</blockquote>
<p><font face="Times New Roman, Times, serif" size="3"><b>4. Representations and
  Warranties.</b> To induce Bank to enter into this Amendment, Borrower hereby
  represents and warrants to Bank as follows:</font></p>
<blockquote>
  <p><font face="Times New Roman, Times, serif" size="3"><b>4.1</b> Immediately
    after giving effect to this Amendment (a) the representations and warranties
    contained in the Loan Documents are true, accurate and complete in all material
    respects as of the date hereof (except to the extent such representations
    and warranties relate to an earlier date, in which case they are true and
    correct as of such date), and (b) no Event of Default has occurred and is
    continuing;</font></p>
  <p><font face="Times New Roman, Times, serif" size="3"><b>4.2</b> Borrower has
    the power and authority to execute and deliver this Amendment and to perform
    its obligations under the Loan Agreement, as amended by this Amendment;</font></p>
  <p><font face="Times New Roman, Times, serif" size="3"><b>4.3</b> The organizational
    documents of Borrower delivered to Bank on the Effective Date remain true,
    accurate and complete and have not been amended, supplemented or restated
    and are and continue to be in full force and effect;</font></p>
  <p><font face="Times New Roman, Times, serif" size="3"><br>
    </font></p>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif" size="3">3</font></p>
<hr>
<font size="3" face="Times New Roman, Times, serif"><br>
</font>
<blockquote>
  <p><font size="3" face="Times New Roman, Times, serif"><b><b>4.4</b> </b>The
    execution and delivery by Borrower of this Amendment and the performance by
    Borrower of its obligations under the Loan Agreement, as amended by this Amendment,
    have been duly authorized;<b><br>
    <br>
    4.5</b> The execution and delivery by Borrower of this Amendment and the performance
    by Borrower of its obligations under the Loan Agreement, as amended by this
    Amendment, do not and will not contravene (a) any law or regulation binding
    on or affecting Borrower, (b) any contractual restriction with a Person binding
    on Borrower, (c) any order, judgment or decree of any court or other governmental
    or public body or authority, or subdivision thereof, binding on Borrower,
    or (d) the organizational documents of Borrower;</font></p>
  <p><font face="Times New Roman, Times, serif" size="3"><b>4.6</b> The execution
    and delivery by Borrower of this Amendment and the performance by Borrower
    of its obligations under the Loan Agreement, as amended by this Amendment,
    do not require any order, consent, approval, license, authorization or validation
    of, or filing, recording or registration with, or exemption by any governmental
    or public body or authority, or subdivision thereof, binding on Borrower,
    except as already has been obtained or made; and</font></p>
  <p><font face="Times New Roman, Times, serif" size="3"><b>4.7</b> This Amendment
    has been duly executed and delivered by Borrower and is the binding obligation
    of Borrower, enforceable against Borrower in accordance with its terms, except
    as such enforceability may be limited by bankruptcy, insolvency, reorganization,
    liquidation, moratorium or other similar laws of general application and equitable
    principles relating to or affecting creditors' rights.</font></p>
</blockquote>
<p><font face="Times New Roman, Times, serif" size="3"><b>5. Counterparts.</b>
  This Amendment may be executed in any number of counterparts and all of such
  counterparts taken together shall be deemed to constitute one and the same instrument.</font></p>
<p><font face="Times New Roman, Times, serif" size="3"><b>6. Effectiveness.</b>
  This Amendment shall be deemed effective upon (a) the due execution and delivery
  to Bank of this Amendment by each party hereto, (b) the due execution and delivery
  to Bank of that certain Second Amendment to Export-Import Bank Loan and Security
  Agreement, dated as of the date hereof, by each party hereto, (c) Borrower's
  payment of a non-refundable amendment fee in an amount equal to Fifteen Thousand
  Dollars ($15,000) (inclusive of the Exim fee), and (d) payment of Bank's legal
  fees and expenses in connection with the negotiation and preparation of this
  Amendment.</font></p>
<p align="center"><font face="Times New Roman, Times, serif" size="3"><br>
  [Signature page follows.]</font></p>
<p align="center">&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif" size="3">4</font></p>
<hr>
<p>&nbsp; </p>
<p><font face="Times New Roman, Times, serif" size="3"><b>IN WITNESS WHEREOF</b>,
  the parties hereto have caused this Amendment to be duly executed and delivered
  as of the date first written above.<br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><b>BANK</b>:</font></p>
<p><font face="Times New Roman, Times, serif" size="3">SILICON VALLEY BANK</font></p>
<p><font face="Times New Roman, Times, serif">By: <u>/s/ Aman Johal </u><br>
  Name: Aman Johal <br>
  Title: Relationship Manager </font></p>
<p><font size="3" face="Times New Roman, Times, serif"><br>
  <b>BORROWER</b>:</font></p>
<p><font face="Times New Roman, Times, serif" size="3">SOCKET MOBILE, INC.</font></p>
<p><font face="Times New Roman, Times, serif">By: <u>/s/ David W. Dunlap</u><br>
  Name: David W. Dunlap<br>
  Title: CFO </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><br>
  <br>
  <br>
  </font></p>
<p align="center">&nbsp;</p>
<hr>
<p align="center"><font size="3" face="Times New Roman, Times, serif"><br>
  <b><u>EXHIBIT B</u></b><br>
  <b><br>
  SILICON VALLEY BANK</b><br>
  <br>
  <b> SPECIALTY FINANCE DIVISION<br>
  Compliance Certificate</b><br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3">I, an authorized officer
  of Socket Mobile, Inc. (&quot;<b>Borrower</b>&quot;) certify under the Loan
  and Security Agreement (the &quot;<b>Agreement</b>&quot;) between Borrower and
  Silicon Valley Bank (&quot;<b>Bank</b>&quot;) as follows (all capitalized terms
  used herein shall have the meaning set forth in the Agreement):<br>
  </font></p>
<p><font size="3" face="Times New Roman, Times, serif"><b>Borrower represents
  and warrants for each Financed Receivable:</b><br>
  </font></p>
<p><font size="3" face="Times New Roman, Times, serif">Each Financed Receivable
  is an Eligible Account.<br>
  <br>
  Borrower is the owner with legal right to sell, transfer, assign and encumber
  such Financed Receivable;<br>
  <br>
  The correct amount is on the Invoice Transmittal and is not disputed;<br>
  <br>
  Payment is not contingent on any obligation or contract and Borrower has fulfilled
  all its obligations as of the Invoice Transmittal date;<br>
  <br>
  Each Financed Receivable is based on an actual sale and delivery of goods and/or
  services rendered, is due to Borrower, is not past due or in default, has not
  been previously sold, assigned, transferred, or pledged and is free of any liens,
  security interests and encumbrances other than Permitted Liens;<br>
  <br>
  There are no defenses, offsets, counterclaims or agreements for which the Account
  Debtor may claim any deduction or discount;<br>
  <br>
  It reasonably believes no Account Debtor is insolvent or subject to any Insolvency
  Proceedings;<br>
  <br>
  It has not filed or had filed against it Insolvency Proceedings and does not
  anticipate any filing;<br>
  <br>
  Bank has the right to endorse and/ or require Borrower to endorse all payments
  received on Financed Receivables and all proceeds of Collateral.<br>
  <br>
  No representation, warranty or other statement of Borrower in any certificate
  or written statement given to Bank contains any untrue statement of a material
  fact or omits to state a material fact necessary to make the statement contained
  in the certificates or statement not misleading. </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><b>Additionally, Borrower
  represents and warrants as follows:<br>
  </b> </font></p>
<p><font size="3" face="Times New Roman, Times, serif">Borrower and each Subsidiary
  is duly existing and in good standing in its state of formation and qualified
  and licensed to do business in, and in good standing in, any state in which
  the conduct of its business or its ownership of property requires that it be
  qualified except where the failure to do so could not reasonably be expected
  to cause a Material Adverse Change. The execution, delivery and performance
  of the Loan Documents have been duly authorized, and do not conflict with Borrower's
  organizational documents, nor constitute an event of default under any material
  agreement by which Borrower is bound. Borrower is not in default under any agreement
  to which or by which it is bound in which the default could reasonably be expected
  to cause a Material Adverse Change.</font></p>
<p align="center">&nbsp;</p>
<hr>
<p><font face="Times New Roman, Times, serif" size="3"><br>
  Borrower has good title to the Collateral, free of Liens except Permitted Liens.
  All inventory is in all material respects of good and marketable quality, free
  from material defects.<br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3">Borrower is not an "investment
  company" or a company "controlled" by an "investment company" under the Investment
  Company Act of 1940, as amended. Neither Borrower nor any of its Subsidiaries
  is a "holding company" or an "affiliate" of a "holding company" or a "subsidiary
  company" of a "holding company" as each term is defined and used in the Public
  Utility Holding Company Act of 2005. Borrower is not engaged as one of its important
  activities in extending credit for margin stock (under Regulations X, T and
  U of the Federal Reserve Board of Governors). Borrower has complied in all material
  respects with the Federal Fair Labor Standards Act. Borrower has not violated
  any laws, ordinances or rules, the violation of which could reasonably be expected
  to cause a Material Adverse Change. None of Borrower's or any Subsidiary's properties
  or assets has been used by Borrower or any Subsidiary or, to the best of Borrower's
  knowledge, by previous Persons, in disposing, producing, storing, treating,
  or transporting any hazardous substance other than legally. Borrower and each
  Subsidiary has timely filed all required tax returns and paid, or made adequate
  provision to pay, all material taxes, except those being contested in good faith
  with adequate reserves under GAAP. Borrower and each Subsidiary has obtained
  all consents, approvals and authorizations of, made all declarations or filings
  with, and given all notices to, all government authorities that are necessary
  to continue its business as currently conducted except where the failure to
  obtain or make such consents, declarations, notices or filings would not reasonably
  be expected to cause a Material Adverse Change.<br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><br>
  </font></p>
<div align="center"></div>
<table width="80%" border="1" cellspacing="0" cellpadding="0">
  <tr>
    <td colspan="3"><font face="Times New Roman, Times, serif"><b>Please indicate
      compliance status by circling Yes/No under &quot;Complies&quot; column.</b></font></td>
  </tr>
  <tr>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
  </tr>
  <tr>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif"><b><u>Reporting
        Covenant</u></b></font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif"><b><u>Required</u></b></font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif"><b><u>Complies</u></b></font></div>
    </td>
  </tr>
  <tr>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
  </tr>
  <tr>
    <td valign="top" height="22"><font face="Times New Roman, Times, serif"> Monthly
      financial statements with Compliance Certificate</font></td>
    <td height="22"><font face="Times New Roman, Times, serif">Monthly within
      30 days</font></td>
    <td height="22">
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td height="16"><font face="Times New Roman, Times, serif">Annual financial
      statement (CPA Audited) + CC</font></td>
    <td height="16"><font face="Times New Roman, Times, serif">FYE within 120
      days</font></td>
    <td height="16">
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td height="23"><font face="Times New Roman, Times, serif">10-Q, 10-K and
      8-K</font></td>
    <td height="23"><font face="Times New Roman, Times, serif">Within 5 days after
      filing with SEC</font></td>
    <td height="23">
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td height="16"><font face="Times New Roman, Times, serif">Borrowing Base
      Certificate A/R & A/P Agings</font></td>
    <td height="16"><font face="Times New Roman, Times, serif">Monthly within
      30 days</font></td>
    <td height="16">
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td height="16"><font face="Times New Roman, Times, serif">Distributor sell-through
      reports</font></td>
    <td height="16"><font face="Times New Roman, Times, serif">Monthly within
      30 days</font></td>
    <td height="16">
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td colspan="3" height="22"><font face="Times New Roman, Times, serif">The
      following Intellectual Property was registered after the Closing Date (if
      no registrations, state "None")</font></td>
  </tr>
</table>
<div align="center"></div>
<p><font face="Times New Roman, Times, serif" size="3"><br>
  </font></p>
<p align="center"><font size="3" face="Times New Roman, Times, serif"><br>
  2</font></p>
<hr>
<p>&nbsp;</p>
<table width="80%" border="1" cellspacing="0" cellpadding="0">
  <tr>
    <td width="50%"><font face="Times New Roman, Times, serif"><b><u>Financial
      Covenants</u></b></font></td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif"><b><u>Required</u></b></font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif"><b><u>Actual</u></b></font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif"><b><u>Complies</u></b></font></div>
    </td>
  </tr>
  <tr>
    <td width="50%"><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
  </tr>
  <tr>
    <td width="50%"><font face="Times New Roman, Times, serif">Maintain at all
      times:</font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
  </tr>
  <tr>
    <td width="50%"><font size="3" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;</font><font face="Times New Roman, Times, serif">Minimum
      Cash at Bank</font></td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">$1,000,000</font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">$<font size="3">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td width="50%"><font face="Times New Roman, Times, serif">Maintain on a Quarterly
      Basis:</font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
  </tr>
  <tr>
    <td width="50%"><font size="3" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;</font><font face="Times New Roman, Times, serif">Minimum
      Revenue</font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
    <td><font face="Times New Roman, Times, serif"></font></td>
  </tr>
  <tr>
    <td width="50%"><font size="3" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font><font face="Times New Roman, Times, serif">April
      1, 2009 through June 30, 2009</font></td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">$4,068,000</font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">$<font size="3">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></font>
      </div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td width="50%"><font size="3" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font><font face="Times New Roman, Times, serif">July
      1, 2009 through September 30, 2009 </font></td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">$4,500,000</font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">$<font size="3">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></font>
      </div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td width="50%"><font size="3" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font><font face="Times New Roman, Times, serif">October
      1, 2009 through December 31, 2009 and for each quarter thereafter</font></td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">$5,355,000</font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">$<font size="3">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></font>
      </div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
</table>
<font size="3" face="Times New Roman, Times, serif"><br>
<br>
</font>
<table width="80%" border="1" cellspacing="0" cellpadding="0">
  <tr>
    <td colspan="2">
      <div align="center"><font face="Times New Roman, Times, serif"><b><u>Performance
        Pricing</u></b></font></div>
    </td>
    <td>
      <div align="center"><font face="Times New Roman, Times, serif"><b><u>Applies</u></b></font></div>
    </td>
  </tr>
  <tr>
    <td valign="top" height="22" width="40%"><font face="Times New Roman, Times, serif">
      Adjusted Quick Ratio <u>&gt;</u>1.25:1.00</font></td>
    <td height="22" width="40%"><font face="Times New Roman, Times, serif">No
      Collateral Handling Fee</font></td>
    <td height="22" width="20%">
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
  <tr>
    <td height="16" width="40%"><font face="Times New Roman, Times, serif">Adjusted
      Quick Ratio &lt;1.25:1.00</font></td>
    <td height="16" width="40%"><font face="Times New Roman, Times, serif">Collateral
      Handling Fee of 0.62%</font></td>
    <td height="16" width="20%">
      <div align="center"><font face="Times New Roman, Times, serif">Yes No</font></div>
    </td>
  </tr>
</table>
<p>&nbsp;</p>
<p><font face="Times New Roman, Times, serif" size="3">All representations and
  warranties in the Agreement are true and correct in all material respects on
  this date, and Borrower represents that there is no existing Event of Default.<br>
  </font></p>
<p><font face="Times New Roman, Times, serif" size="3">Sincerely,</font></p>
<p><font face="Times New Roman, Times, serif" size="3">Socket Mobile, Inc. </font></p>
<p><font face="Times New Roman, Times, serif" size="3"><br>
  ____________________________________<br>
  Signature</font></p>
<p><font face="Times New Roman, Times, serif" size="3">____________________________________<br>
  Title<br>
  <br>
  ____________________________________<br>
  Date</font></p>
<p></p>
<p></p>
<p></p>
<p></p>
<p></p>
<p></p>
<p></p>
<p align="center"><font size="3" face="Times New Roman, Times, serif">3</font></p>
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<TYPE>EX-10.2
<SEQUENCE>3
<FILENAME>ex102.htm
<DESCRIPTION>EXHIBIT 10.2
<TEXT>
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<p align="right"><font face="Times New Roman, Times, serif"><b>Exhibit 10.2</b></font></p>
<p align="center"><font face="Times New Roman, Times, serif"><br>
  <b><br>
  SECOND AMENDMENT TO SECOND AMENDED AND RESTATED<u><br>
  EXPORT-IMPORT BANK LOAN AND SECURITY AGREEMENT<br>
  </u></b><br>
  </font></p>
<p><font face="Times New Roman, Times, serif">THIS SECOND AMENDMENT TO SECOND
  AMENDED AND RESTATED EXPORT-IMPORT BANK LOAN AND SECURITY AGREEMENT (this &quot;Amendment&quot;)
  is entered into this 7th day of July, 2009, by and between SILICON VALLEY BANK
  (&quot;Bank&quot;) and SOCKET MOBILE, INC., a Delaware corporation (&quot;Borrower&quot;),
  whose address is 39700 Eureka Drive, Newark, California 94560.<br>
  </font></p>
<p align="center"><font face="Times New Roman, Times, serif"><b>RECITALS</b><br>
  </font></p>
<p><font face="Times New Roman, Times, serif"><b>A</b>. Bank and Borrower have
  entered into that certain Second Amended and Restated Export-Import Bank Loan
  and Security Agreement dated as of December 24, 2008 (as the same has been amended,
  modified, supplemented or restated, the &quot;EXIM Loan Agreement&quot;).<br>
  </font></p>
<p><font face="Times New Roman, Times, serif"><b>B</b>. Bank has extended credit
  to Borrower for the purposes permitted in the EXIM Loan Agreement.<br>
  </font></p>
<p><font face="Times New Roman, Times, serif"><b>C</b>. Borrower is currently
  in violation of the EXIM Loan Agreement for failing to comply with the Adjusted
  Quick Ratio covenant set forth in Section 6.6 of the Domestic Loan Agreement
  (the &quot;Adjusted Quick Ratio Covenant&quot;) for the months ended April 30,
  2009 and May 31, 2009 and anticipates being in violation of the Adjusted Quick
  Ratio Covenant as of June 30, 2009, each of which, if not waived by Bank, would
  constitute an Event of Default pursuant to Section 7.1 of the EXIM Loan Agreement.</font></p>
<p><font face="Times New Roman, Times, serif"><b>D</b>. Borrower has requested
  that Bank waive the Adjusted Quick Ratio Covenant for the months ended April
  30, 2009, May 31, 2009 and June 30, 2009. Although Bank is under no obligation
  to do so, Bank is willing to waive the Adjusted Quick Ratio Covenant for the
  months ended April 30, 2009, May 31, 2009 and June 30, 2009 and amend certain
  provisions of the EXIM Loan Agreement, all on the terms and conditions set forth
  in this Amendment, so long as Borrower complies with the terms, covenants and
  conditions set forth in this Amendment in a timely manner.</font></p>
<p align="center"><font face="Times New Roman, Times, serif"><b>AGREEMENT</b></font></p>
<p><font face="Times New Roman, Times, serif"><b>NOW, THEREFORE</b>, in consideration
  of the foregoing recitals and other good and valuable consideration, the receipt
  and adequacy of which is hereby acknowledged, and intending to be legally bound,
  the parties hereto agree as follows:<br>
  </font></p>
<p><font face="Times New Roman, Times, serif"><b>1. Definitions. </b>Capitalized
  terms used but not defined in this Amendment shall have the meanings given to
  them in the EXIM Loan Agreement. </font></p>
<p><font face="Times New Roman, Times, serif"><b>2. Amendments to EXIM Loan Agreement.</b><br>
  </font></p>
<blockquote>
  <p><font face="Times New Roman, Times, serif"><b>2.1 Waiver of Adjusted Quick
    Ratio Covenant</b>. Bank hereby waives the Adjusted Quick Ratio Covenant for
    the months ended April 30, 2009, May 31, 2009 and June 30, 2009. Bank's agreement
    to waive the Adjusted Quick Ratio Covenant for the months ended April 30,
    2009, May 31, 2009 and June 30, 2009 shall in no way obligate Bank to make
    any other modifications to the EXIM Loan Agreement or to waive Borrower's
    compliance with any other terms of the Loan Documents, and shall not limit
    or impair Bank's right to demand strict performance of all other terms and
    covenants as of any date. The waiver set forth above shall not be deemed or
    otherwise construed to constitute a waiver of any other provisions of the
    EXIM Loan Agreement in connection with any other transaction. </font></p>
</blockquote>
<p><font face="Times New Roman, Times, serif"><br>
  </font></p>
<p align="center"><font face="Times New Roman, Times, serif">1</font></p>
<hr>
<blockquote>
  <p><font face="Times New Roman, Times, serif"><b><br>
    2.2</b> <b>Section 2.2 (Collections, Interest Rate, Lockbox)</b>. The last
    two sentences of Section 2.2(b) of the EXIM Loan Agreement are hereby amended
    by deleting them in their entirety and replacing them with the following:</font></p>
  <p><font face="Times New Roman, Times, serif">Because the Advance Rate may differ
    based on the type of EXIM Eligible Account, the Bank will from time to time,
    adjust the Finance Charge on Advances made at an Advance Rate of 50% so that
    the effective Finance Charge on such Advances is reasonably equivalent to
    the Finance Charge which applies to Advances based on an 70% Advance Rate.
    After an Event of Default, the Applicable Rate will increase an additional
    5.00% per annum effective immediately upon the occurrence of such Event of
    Default.</font></p>
  <p><font face="Times New Roman, Times, serif"><b>2.3 Section 2.4 (Fees)</b>.
    The first sentence of Section 2.4(c) of the EXIM Loan Agreement is hereby
    amended by deleting it in its entirety and replacing it with the following:</font></p>
  <p><font face="Times New Roman, Times, serif">Borrower will pay to Bank a collateral
    handling fee equal to 0.62% per month of the Financed Receivable Balance for
    each Financed Receivable outstanding based upon a 360 day year (the &quot;<b>Collateral
    Handling Fee</b>&quot;).</font></p>
  <p><font face="Times New Roman, Times, serif"><b>2.4 Section 13 (Definitions)</b>.
    The following term and its definition set forth in Section 13.1 of the EXIM
    Loan Agreement is amended in its entirety and replaced with the following:</font></p>
  <p><font face="Times New Roman, Times, serif">&quot;<b>Advance Rate</b>&quot;
    is 70% of EXIM Eligible Foreign Accounts which are covered by the EXIM working
    Capital Guarantee Program, provided, however, that with respect to any Account
    Debtor which is a distributor, the Advance Rate shall be 50%.</font></p>
</blockquote>
<p><font face="Times New Roman, Times, serif"><b>3. Limitation of Amendments.</b></font></p>
<blockquote>
  <p><font face="Times New Roman, Times, serif"><b>3.1</b> The amendments set
    forth in <b>Section 2</b>, above, are effective for the purposes set forth
    herein and shall be limited precisely as written and shall not be deemed to
    (a) be a consent to any amendment, waiver or modification of any other term
    or condition of any Loan Document, or (b) otherwise prejudice any right or
    remedy which Bank may now have or may have in the future under or in connection
    with any Loan Document.</font></p>
  <p><font face="Times New Roman, Times, serif"><b>3.2</b> This Amendment shall
    be construed in connection with and as part of the Loan Documents and all
    terms, conditions, representations, warranties, covenants and agreements set
    forth in the Loan Documents, except as herein amended, are hereby ratified
    and confirmed and shall remain in full force and effect.</font></p>
  <p>&nbsp;</p>
  <p align="center"><font face="Times New Roman, Times, serif">2</font></p>
</blockquote>
<hr>
<blockquote>
  <p>&nbsp;</p>
</blockquote>
<p><font face="Times New Roman, Times, serif"><b>4. Representations and Warranties.</b>
  To induce Bank to enter into this Amendment, Borrower hereby represents and
  warrants to Bank as follows:</font></p>
<blockquote>
  <p><font face="Times New Roman, Times, serif"><b>4.1</b> Immediately after giving
    effect to this Amendment (a) the representations and warranties contained
    in the Loan Documents are true, accurate and complete in all material respects
    as of the date hereof (except to the extent such representations and warranties
    relate to an earlier date, in which case they are true and correct as of such
    date), and (b) no Event of Default has occurred and is continuing;</font></p>
  <p><font face="Times New Roman, Times, serif"><b>4.2</b> Borrower has the power
    and authority to execute and deliver this Amendment and to perform its obligations
    under the EXIM Loan Agreement, as amended by this Amendment;</font></p>
  <p><font face="Times New Roman, Times, serif"><b>4.3</b> The organizational
    documents of Borrower delivered to Bank on the Effective Date remain true,
    accurate and complete and have not been amended, supplemented or restated
    and are and continue to be in full force and effect;</font></p>
  <p><font face="Times New Roman, Times, serif"><b>4.4</b> The execution and delivery
    by Borrower of this Amendment and the performance by Borrower of its obligations
    under the EXIM Loan Agreement, as amended by this Amendment, have been duly
    authorized;</font> </p>
</blockquote>
<blockquote>
  <p><font face="Times New Roman, Times, serif"><b>4.5</b> The execution and delivery
    by Borrower of this Amendment and the performance by Borrower of its obligations
    under the EXIM Loan Agreement, as amended by this Amendment, do not and will
    not contravene (a) any law or regulation binding on or affecting Borrower,
    (b) any contractual restriction with a Person binding on Borrower, (c) any
    order, judgment or decree of any court or other governmental or public body
    or authority, or subdivision thereof, binding on Borrower, or (d) the organizational
    documents of Borrower;</font></p>
  <p><font face="Times New Roman, Times, serif"><b>4.6</b> The execution and delivery
    by Borrower of this Amendment and the performance by Borrower of its obligations
    under the EXIM Loan Agreement, as amended by this Amendment, do not require
    any order, consent, approval, license, authorization or validation of, or
    filing, recording or registration with, or exemption by any governmental or
    public body or authority, or subdivision thereof, binding on Borrower, except
    as already has been obtained or made; and</font></p>
  <p><font face="Times New Roman, Times, serif"><b>4.7</b> This Amendment has
    been duly executed and delivered by Borrower and is the binding obligation
    of Borrower, enforceable against Borrower in accordance with its terms, except
    as such enforceability may be limited by bankruptcy, insolvency, reorganization,
    liquidation, moratorium or other similar laws of general application and equitable
    principles relating to or affecting creditors' rights.</font></p>
</blockquote>
<p><font face="Times New Roman, Times, serif"><b>5. Counterparts.</b> This Amendment
  may be executed in any number of counterparts and all of such counterparts taken
  together shall be deemed to constitute one and the same instrument.</font></p>
<p><font face="Times New Roman, Times, serif"><b>6. Effectiveness.</b> This Amendment
  shall be deemed effective upon (a) the due execution and delivery to Bank of
  this Amendment by each party hereto, (b) the due execution and delivery to Bank
  of that certain Second Amendment to Second Amended and Restated Loan and Security
  Agreement, dated as of the date hereof, by each party hereto, and the satisfaction
  of the conditions precedent set forth therein and (c) payment of Bank's legal
  fees and expenses in connection with the negotiation and preparation of this
  Amendment.</font></p>
<p align="center"><font face="Times New Roman, Times, serif"><br>
  [Signature page follows.]</font></p>
<p align="center">&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif">3</font></p>
<hr>
<p>&nbsp; </p>
<p><font face="Times New Roman, Times, serif"><b>IN WITNESS WHEREOF</b>, the parties
  hereto have caused this Amendment to be duly executed and delivered as of the
  date first written above.<br>
  </font></p>
<p><font face="Times New Roman, Times, serif">BANK:</font></p>
<p><font face="Times New Roman, Times, serif">SILICON VALLEY BANK</font></p>
<p><font face="Times New Roman, Times, serif">By: <u>/s/ Aman Johal</u> <br>
  Name: Aman Johal <br>
  Title: Relationship Manager </font></p>
<p><font face="Times New Roman, Times, serif">BORROWER:</font></p>
<p><font face="Times New Roman, Times, serif">SOCKET MOBILE, INC.</font></p>
<p><font face="Times New Roman, Times, serif">By: <u>/s/ David W. Dunlap</u><br>
  Name: David W. Dunlap<br>
  Title: CFO </font></p>
<p><font face="Times New Roman, Times, serif"><br>
  <br>
  <br>
  </font></p>
<p align="center">&nbsp;</p>
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