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<SEC-DOCUMENT>0000944075-09-000048.txt : 20091006
<SEC-HEADER>0000944075-09-000048.hdr.sgml : 20091006
<ACCEPTANCE-DATETIME>20091006171938
ACCESSION NUMBER:		0000944075-09-000048
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		4
CONFORMED PERIOD OF REPORT:	20090930
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20091006
DATE AS OF CHANGE:		20091006

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:		091108705

	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-8k0930.htm
<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>
  </font><font
face="Times New Roman, Times, serif" size=3><b>CURRENT REPORT</b><br>
  <br>
  Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934</font><font face="Times New Roman, Times, serif"
size=3><br>
  <b><br>
  </b></font></p>
<p align=center><font face="Times New Roman, Times, serif" size=3><b>September
  30</b></font><b><font face="Times New Roman, Times, serif" size=3>, 2009</font></b><font face="Times New Roman, Times, serif" size=3><br>
  Date of Report<br>
  <font size="2">(Date of earliest event reported)</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>
<hr width="100%">
<p><br>
</p>
<p><b>Item 1.01. Entry into a Material Definitive Agreement.</b></p>
<p><b>Sale of Serial Product Line Assets to Quatech, Inc.</b></p>
<p>On September 30, 2009, Socket Mobile, Inc. (the "Company") entered into an
  Asset Purchase Agreement, pursuant to which the Company simultaneously sold
  its SocketSerial product line to Quatech Inc. ("Quatech"), a wholly owned subsidiary
  of DPAC Technologies Corp. and manufacturer of wireless machine-to-machine networking
  and device connectivity systems. Quatech's purchase of the assets from the Company
  was made with interim financing provided by Development Capital Ventures, LP.
  Under the terms of the Asset Purchase Agreement, Quatech acquired for the sum
  of $500,000 all rights, title and interest in the Company's serial products
  business including related product designs, the SocketSerial brand name and
  SocketSerial website under which the serial products were marketed by the Company.
  $450,000 of the purchase price was paid at the time of the closing of the transaction.
  The remaining $50,000 of the purchase price is contingent and payable upon the
  attainment by Quatech of quarterly revenue from the sale of SocketSerial products
  of at least $250,000 in any quarter through the quarter ending December 31,
  2010. The Company will recognize $450,000 ($0.12 per share) as a gain on sale
  of assets in its reported results for the quarter ended September 30, 2009.
  The Company will use the proceeds from the transaction for working capital purposes.
</p>
<p>SocketSerial product line sales for the quarter ended June 30, 2009 were $229,000
  or approximately 5.5 percent of the Company's revenues for that quarter. The
  products in the SocketSerial product line consist of a CompactFlash serial card,
  a PC serial card, a PC dual serial card, and a PC serial card, all with fixed
  and removable cable models. Also included are the Company's USB to Serial Adapter,
  USB to Ethernet Adapter and Cordless Serial Adapter. Quatech intends to continue
  to manufacture and distribute the SocketSerial product line and will assume
  existing customer support responsibilities.</p>
<p>Each of the Company and Quatech made customary, representations, warranties
  and covenants in the Asset Purchase Agreement. Each of the Company and Quatech
  also agreed to indemnify the other party for losses arising out of breaches
  of such party's representations, warranties and covenants and certain other
  liabilities. </p>
<p>The Company also agreed for a period of three years that it will not (a) invest
  in, own, manage, operate, finance, control, advise, render services to or guarantee
  the obligations of any other party engaged in the serial card business, (b)
  directly or indirectly contact any customer of the serial card business or any
  customer of Quatech for the purpose of soliciting such customer to purchase,
  lease or license a product or service that would be in competition with those
  products or services made, rendered, offered or under development by Quatech,
  or (c) directly or indirectly interfere with or attempt to disrupt the relationship,
  contractual or otherwise, between Quatech and any of its employees or solicit
  an employee of Quatech to terminate employment with Quatech and become self-employed
  or employed with others in the same or similar business.</p>
<p align="center">1</p>
<hr width="100%">
<p align="left">In connection with the sale and purchase of the serial products
  business, the Company and Quatech also entered into a Supply and Licensing Agreement
  pursuant to which the Company will (i) supply Quatech with its proprietary HIS3
  interface chip used in the serial products, (ii) license its Bluetooth software
  to Quatech for use in the Cordless Serial Adapter, and (iii) supply a limited
  quantity of the Cordless Serial Adapter product currently held in the Company's
  inventory. </p>
<p align="left">The foregoing descriptions of the Asset Purchase Agreement and
  Supply and Licensing Agreement are qualified in their entirety by reference
  to the full text of such agreements, which are attached hereto as Exhibits 10.1
  and 10.2, respectively and incorporated herein by reference.</p>
<p>The Company and Quatech announced the transactions described above in a press
  announcement dated October 1, 2009, which is attached hereto as Exhibit 99.1
  and incorporated herein by reference.</p>
<p><br>
  <b>Item 9.01 Financial Statements and Exhibits.</b></p>
<table cellspacing=0 cellpadding=0 width="100%" align=left border=0>
  <tr valign=bottom>
    <td width=215 height=54>
      <div align=center><font face="Times New Roman, Times, serif"><b>Exhibit
        No.</b></font></div>
    </td>
    <td width=29 height=54>&nbsp;</td>
    <td width=680 height=54>
      <div align="left"><font
      face="Times New Roman, Times, serif"><b>Description</b></font></div>
    </td>
  </tr>
  <tr valign=top>
    <td valign=top align=middle width=215>
      <hr color=#000000 noShade size=0>
    </td>
    <td width=29>&nbsp;</td>
    <td width=680>
      <div
      align=center>
        <hr color=#000000 noShade size=0>
      </div>
    </td>
  </tr>
  <tr valign=top>
    <td width=215>
      <div align=center><font
      face="Times New Roman, Times, serif">10.1</font></div>
    </td>
    <td width=29>&nbsp;</td>
    <td width=680>Asset Purchase Agreement, dated as of September 30, 2009, among
      Socket Mobile, Inc., Development Capital Ventures, LP and Quatech Inc.</td>
  </tr>
  <tr valign=top>
    <td width=215>
      <div align=center><font
      face="Times New Roman, Times, serif">10.2</font></div>
    </td>
    <td width=29>&nbsp;</td>
    <td width=680>Supply and Licensing Agreement Between Quatech, Inc. and Socket
      Mobile, Inc.</td>
  </tr>
  <tr valign=top>
    <td width=215>
      <div align=center><font
      face="Times New Roman, Times, serif">99.1</font></div>
    </td>
    <td width=29>&nbsp;</td>
    <td width=680>Press release dated October 1, 2009</td>
  </tr>
</table>
<p>&nbsp;</p>
<p>&nbsp;</p>
<hr width="100%">
<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>
<p align="center">2</p>
<hr width="100%">
<p>&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.</p>
<p>&nbsp;</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=100% 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: October
          6, 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/&nbsp
        </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">&nbsp</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>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><br>
</p>
<p align="center">3</p>
<p align="center">&nbsp;</p>
<hr width="100%">
<p>&nbsp;</p>
<p align="center"><font
face="Times New Roman, Times, serif"><b>EXHIBIT INDEX</b></font></p>
<table cellspacing=0 cellpadding=0 width="100%" align=left border=0>
  <tr valign=bottom>
    <td width=215 height=54>
      <div align=center><font face="Times New Roman, Times, serif"><b>Exhibit
        No.</b></font></div>
    </td>
    <td width=29 height=54>&nbsp;</td>
    <td width=680 height=54>
      <div align="left"><font
      face="Times New Roman, Times, serif"><b>Description</b></font></div>
    </td>
  </tr>
  <tr valign=top>
    <td valign=top align=middle width=215>
      <hr color=#000000 noShade size=0>
    </td>
    <td width=29>&nbsp;</td>
    <td width=680>
      <div
      align=center>
        <hr color=#000000 noShade size=0>
      </div>
    </td>
  </tr>
  <tr valign=top>
    <td width=215>
      <div align=center><font
      face="Times New Roman, Times, serif">10.1</font></div>
    </td>
    <td width=29>&nbsp;</td>
    <td width=680>Asset Purchase Agreement, dated as of September 30, 2009, among
      Socket Mobile, Inc., Development Capital Ventures, LP and Quatech Inc.</td>
  </tr>
  <tr valign=top>
    <td width=215>
      <div align=center><font
      face="Times New Roman, Times, serif">10.2</font></div>
    </td>
    <td width=29>&nbsp;</td>
    <td width=680>Supply and Licensing Agreement Between Quatech, Inc. and Socket
      Mobile, Inc.</td>
  </tr>
  <tr valign=top>
    <td width=215>
      <div align=center><font
      face="Times New Roman, Times, serif">99.1</font></div>
    </td>
    <td width=29>&nbsp;</td>
    <td width=680>Press release dated October 1, 2009</td>
  </tr>
</table>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">4</p>
<hr width="100%">
</body>
</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<FILENAME>ex10-1.htm
<TEXT>
<HTML>
<HEAD></HEAD><BODY bgcolor=white>
<div align="right"><font face="Times New Roman, Times, serif" size="3"> <b>Exhibit
  10.1 <br>
  &#9;&#9;&#9;&#9;</b></font></div>
<P ALIGN="center">&nbsp;</P>
<P ALIGN="center">&nbsp;</P>
<P ALIGN="center"><font face="Times New Roman, Times, serif" size="3"><b>ASSET
  PURCHASE AGREEMENT<br>
  <br>
  BY AND</b></font></P>
<P ALIGN="center"><font face="Times New Roman, Times, serif" size="3"><b>AMONG</b></font></P>
<P ALIGN="center"><font face="Times New Roman, Times, serif" size="3"><b>SOCKET
  MOBILE, INC.,</b></font></P>
<P ALIGN="center"><font face="Times New Roman, Times, serif" size="3"><b>DEVELOPMENT
  CAPITAL VENTURES, LP</b></font></P>
<P ALIGN="center"><font face="Times New Roman, Times, serif" size="3"><b>AND</b></font></P>
<P ALIGN="center"><font face="Times New Roman, Times, serif" size="3"><b>QUATECH
  INC.</b></font></P>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<hr align="LEFT" size=4>
<P ALIGN="left">&nbsp;</P>
<P ALIGN="left">&nbsp;</P>
<table width="878" border="0" cellspacing="0" cellpadding="0" align="center">
  <tr>
    <td colspan="3">
      <div align="center"></div>
      <p align=center><font face="Times New Roman, Times, serif" size="3"><strong>TABLE
        OF CONTENTS</strong></font></p>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">&nbsp;</td>
    <td width="56">
      <div align="center"><font face="Times New Roman, Times, serif" size="3"></font></div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td colspan="2">1. AGREEMENT TO SELL AND PURCHASE CERTAIN ASSETS</td>
    <td width="56">
      <div align="center">1</div>
    </td>
  </tr>
  <tr>
    <td colspan="3">&nbsp;</td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">1.1 Agreement to Sell and Purchase</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">1</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">1.2 Treatment of Liabilities</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">2</div>
    </td>
  </tr>
  <tr>
    <td width="26" height="10">&nbsp;</td>
    <td width="796" height="10">1.3 Delivery of Assets</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 2</font></div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">1.4 Supply and Licensing Agreement</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">3</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">1.5 Transition Services</td>
    <td width="56" align="center" valign="bottom">&nbsp;</td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td colspan="2">2. PURCHASE PRICE</td>
    <td width="56">
      <div align="center">3</div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">2.1 Purchase Price</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">3</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">2.2 Allocation of Purchase Price</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">4</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">2.3 Transfer Taxes</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">4</div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td colspan="2">3. CLOSING</td>
    <td width="56">
      <div align="center">4</div>
    </td>
  </tr>
  <tr>
    <td colspan="3">&nbsp;</td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">3.1 Date and Time</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">4</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">3.2 Seller's Deliveries</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">4</div>
    </td>
  </tr>
  <tr>
    <td width="26" height="10">&nbsp;</td>
    <td width="796" height="10">3.3 Purchaser Deliveries</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 5</font></div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">3.4 Inventory</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">5</div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td colspan="2">4. REPRESENTATIONS AND WARRANTIES OF SELLER</td>
    <td width="56">
      <div align="center">5</div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.1 Organization of Seller; Authorizations</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">5</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.2 Requisite Power and Authority</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">6</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.3 Seller's Requisite Consents; Nonviolation</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 6</font></div>
    </td>
  </tr>
  <tr>
    <td width="26" height="15">&nbsp;</td>
    <td width="796" height="15">4.4 No Undisclosed Liabilities</td>
    <td width="56" align="center" valign="bottom" height="15">
      <div align="center">6</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.5 Title to Assets</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">6</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.6 Assigned Contracts</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">6</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.7 Litigation</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 7</font></div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.8 Intellectual Property</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">7</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.9 Compliance with Laws</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">11</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.10 Tangible Assets</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">11</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">4.11 Inventory</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 11</font></div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td colspan="2">5. OTHER COVENANTS</td>
    <td width="56">
      <div align="center">11</div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.1 Expenses</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">11</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.2 Books and Records</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">11</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.3 Bulk Transfer Laws</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 12</font></div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.4 Confidentiality</td>
    <td width="56" align="center" valign="bottom" height="15">
      <div align="center">12</div>
    </td>
  </tr>
  <tr>
    <td width="26" height="15">&nbsp;</td>
    <td width="796" height="15">5.5 Publicity</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">12</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.6 Discontinuation of Operations</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">12</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.7 Non-competition</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 12</font></div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.8 Remedies</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">13</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.9 Insurance and Access</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">13</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.10 Litigation Support</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">14</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.11 Post Closing Accounts Receivable</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 14</font></div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">5.12 Product Returns</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 14</font></div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td colspan="2">6. INDEMNIFICATION</td>
    <td width="56">
      <div align="center">14</div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">6.1 Indemnification by the Seller</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">14</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">6.2 Indemnification by the Purchaser</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">15</div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td colspan="2">7. MISCELLANEOUS</td>
    <td width="56">
      <div align="center">16</div>
    </td>
  </tr>
  <tr>
    <td colspan="2">&nbsp;</td>
    <td width="56">&nbsp;</td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">7.1 No Waiver</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">16</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">7.2 Successors and Assigns</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">16</div>
    </td>
  </tr>
  <tr>
    <td width="26" height="10">&nbsp;</td>
    <td width="796" height="10">7.3 Notices</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 16</font></div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">7.4 Survival of Obligations</td>
    <td width="56" align="center" valign="bottom" height="15">
      <div align="center">16</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">7.5 Complete Agreement</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">17</div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">7.6 Applicable Law; Jurisdiction</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">17</div>
    </td>
  </tr>
  <tr>
    <td width="26" height="10">&nbsp;</td>
    <td width="796" height="10">7.7 Counterparts</td>
    <td width="56" height="10" align="center" valign="bottom">
      <div align="center"><font face="Times New Roman, Times, serif"> 17</font></div>
    </td>
  </tr>
  <tr>
    <td width="26">&nbsp;</td>
    <td width="796">7.8 Further Assurances</td>
    <td width="56" align="center" valign="bottom">
      <div align="center">17</div>
    </td>
  </tr>
</table>
<P ALIGN="center">&nbsp;</P>
<P ALIGN="center">&nbsp;</P>
<hr align="LEFT" size=4>
<P ALIGN="center"><font face="Times New Roman, Times, serif"><b><br>
  </b></font><font face="Times New Roman, Times, serif"> </font></P>
<p align="center"><b><u>ASSET PURCHASE AGREEMENT</u></b></p>
<p><br>
  This ASSET PURCHASE AGREEMENT (this &quot;<u>Agreement</u>&quot;) is made as
  of the close of business on September 30, 2009, by and among Socket Mobile,
  Inc., a Delaware corporation, (&quot;<u>Seller</u>&quot;), Development Capital
  Ventures, LP (&quot;<u>Funder</u>&quot;) located at 5820 Fitzhugh Street, Burke,
  VA 22015, and Quatech Inc., an Ohio corporation (&quot;<u>Purchaser</u>&quot;).<br>
</p>
<p>1. <u><b>AGREEMENT TO SELL AND PURCHASE CERTAIN ASSETS</b></u><br>
</p>
<blockquote>
  <p>1.1 <u>Agreement to Sell and Purchase. </u></p>
</blockquote>
<p> At the Closing, Seller will sell, convey, transfer, assign and deliver to
  Funder, for the purpose of enabling the purchase by Purchaser, and Purchaser
  will, upon completion of arrangements with Funder, complete the purchase and
  assume from Funder, all assets of Seller which pertain to Seller's <b>serial
  card business</b> (the &quot;<u>Business</u>&quot;), free and clear of all liens,
  charges, claims, mortgages, pledges, easements, encumbrances, security interests,
  adverse claims or any other title defects or restrictions of any kind (collectively,
  &quot;<u>Encumbrances</u>&quot;). For the purpose of this transaction, Funder
  is deemed an intermediary who will fund the purchase by Purchaser and enable
  its immediate transfer to Purchaser. Accordingly, all references to Purchaser
  are made with the expectation that all rights, title and interest in the Asset
  Purchase Agreement and related documents have been transferred by Funder to
  Purchaser. Until notification by Funder to Seller of the completion of the transfer
  to Purchaser, Seller shall follow the instructions from Funder as to the matters
  that Purchaser has agreed to undertake. The assets of Seller which pertain to
  Seller's serial card business include, without limitation:<br>
</p>
<blockquote>
  <blockquote>
    <p>(a) The tangible personal property and assets of Seller, including without
      limitation the property listed on <u>Schedule 1.1(a)</u> to this Agreement,
      related to or used in the Business (the &quot;<u>Assets</u>&quot;) as currently
      conducted and as currently proposed to be conducted;<br>
    </p>
    <p>(b) All of Seller's right, title and interest in, to and under any contract,
      purchase order, license or other agreement to the ownership, manufacture
      and distribution of the Assets as listed on <u>Schedule 1.1(b)</u> to this
      Agreement (the &quot;<u>Seller Contracts</u>&quot;) ;<br>
    </p>
    <p>(c) All of Seller's right, title and interest in and to (i) all intangible
      assets of Seller, including all Intellectual Property (as defined in Section
      4.8(n) below) of the Seller related to or used in connection with the Business
      as currently conducted or as currently proposed to be conducted (collectively,
      the &quot;<u>Seller Owned Proprietary Rights</u>&quot;), including all engineering
      drawings and specifications, data sheets and the Intellectual Property described
      on <u>Schedule 1.1(c)</u> to this Agreement and including without limitation
      all rights in and to use the name &quot;<b>Socket Serial</b>&quot; and the
      date of first use of each such mark in each respective country where such
      mark is used (the &quot;<u>Marks</u>, (ii) the licenses, leases, assignments,
      rights to use and other agreements for the license, lease and assignment
      of, or provision of the right to use Intellectual Property of another person
      that is related to or used or useful in connection with the Business as
      currently conducted or as currently proposed to be conducted, together with
      all rights, privileges, prepaid fees, deposits, credits and claims of the
      Seller thereunder (collectively, the &quot;<u>Seller Licensed Proprietary
      Rights Agreements</u>&quot;), including without limitation those listed
      on Schedule 1.1(c)(ii) hereto, and (iii) all Intellectual Property that
      the Seller has a right to use that is related to or used in connection with
      the Business as currently conducted or as currently proposed to be conducted
      under the Seller Licensed Proprietary Rights Agreements (collectively, the
      &quot;<u>Seller Licensed Proprietary Rights</u>&quot; and together with
      the Seller Owned Proprietary Rights, the &quot;Seller Proprietary Rights&quot;),
      including the Intellectual Property listed on <u>Schedule 1.1(c)(iii)</u>
      hereto. </p>
    <p align="center"><font face="Times New Roman, Times, serif">1</font></p>
  </blockquote>
</blockquote>
<hr align="LEFT" size=4>
<blockquote>
  <blockquote>
    <p><br>
    </p>
    <p>(d) all of the Seller's customer lists and other records, files, data,
      reports, lists, ledgers, market studies, books and records used in or relating
      to the Business as currently conducted or as currently proposed to be conducted
      (including such records as are contained in any computer media). </p>
  </blockquote>
</blockquote>
<p align="center">&nbsp; </p>
<p> 1.2 <u>Treatment of Liabilities.</u><br>
</p>
<blockquote>
  <p>(a) In connection with the sale of the Assets to Purchaser, Purchaser will
    assume only the following liabilities of Seller (collectively, the &quot;Assumed
    Liabilities&quot;): those obligations of Seller relating to the Assigned Contracts
    or breaches of any product warranties offered in connection with the Assets
    arising out of sales of the Assets made by Purchaser from and after the Closing
    in accordance with the terms thereof, but excluding any obligations arising
    as a result of any breach, default or failure to perform by Seller under any
    Assigned Contract or product warranties offered in connection with the Assets
    prior to the Closing except as described in Schedule 1.2 relating to the assumption
    of warranty customer support by Purchaser .<br>
  </p>
  <p>(b) Except for the Assumed Liabilities, Purchaser will not assume, and will
    not be liable for, any of Seller's debts, liabilities, taxes, obligations,
    contracts or commitments of any nature or kind whatsoever, whether existing
    as of the Closing or arising thereafter, known or unknown, contingent or otherwise,
    including any payroll liabilities and obligations of Seller (the &quot;Excluded
    Liabilities&quot;). All Excluded Liabilities will be solely those of Seller
    and will be satisfied by Seller, and Purchaser shall have no liability under
    any circumstances<br>
  </p>
</blockquote>
<p>1.3 <u>Delivery of Assets.</u><br>
</p>
<blockquote>
  <p>(a) Within five (5) days from the Closing Date, Seller shall arrange for
    delivery, at the sole expense of Seller, of the Assets listed in Article 1.1(c)
    to Purchaser at Purchaser's address specified in Section 7.3 of this Agreement.
    Electronic transfer may be used as mutually agreed between the parties. Seller
    shall retain all risk of loss and damage regarding the Assets until such time
    as the Assets are delivered to Purchaser pursuant to this Section 1.3, at
    which time the risk of loss and damage to the Assets shall pass to Purchaser.<br>
  </p>
  <p>(b) Seller shall retain and use the assets listed in Article 1.1 (a), consisting
    primarily of on hand and consigned inventory components and tooling, during
    the month of September to supply inventory to the Purchaser and to Distributors
    as described under Article 1.5, Transition Services. Purchaser shall compile
    by October 15, 2009 a list of inventory components as of the end of September
    for purchase by Purchaser at Seller's cost. These dates may be modified by
    mutual agreement of the parties. Inventory components to be purchased shall
    consist only of inventory deemed useable by Purchaser in Purchaser's sole
    discretion. Seller's cost shall consist of material, labor and overhead. <br>
  </p>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif">2</font></p>
<hr align="LEFT" size=4>
<p>1.4 <u>Supply and Licensing Agreement</u><br>
</p>
<p>Seller is also in the business or designing, manufacturing and selling HIS3
  computer chips (the &quot;Chips&quot;) which are a component used in the manufacturing
  of certain of the Assets. The Chips are not included in the definition of &quot;Assets&quot;
  and are not included in this sale. Seller and Purchaser will enter into a supply,
  support and limited licensing agreement (the &quot;Supply and Licensing Agreement&quot;),
  in substantially the form attached hereto as Schedule 1.4, pursuant to which
  Seller will, among other things, continue to manufacture the Chips and sell
  them to Purchaser. Seller and Purchaser are also entering into a Cordless Serial
  Adapter License to enable Purchaser to use Seller's Bluetooth software with
  the Cordless Serial Adapter Product. Such license is included in the &quot;Supply
  and Licensing Agreement, in substantially the form attached hereto as Exhibit
  1.4.<br>
</p>
<p>1.5 <u>Transition Services.</u><br>
</p>
<p>Seller and Purchaser agree that they shall enter into a transitional services
  arrangement pursuant to the mutually agreed upon schedule and timeframe provided
  for on Schedule 1.5 hereto. Seller will provide Purchaser with those certain
  services listed on Schedule 1.5, which shall include, among other things, providing
  Purchaser with warranty support training and information, secondary customer
  support services and facilitating communications between Purchaser and Seller's
  distributors and manufacturers. Schedule 1.5 also provides for continued supply
  of product by Seller to distributors and to Purchaser during September, for
  the accounting for post-closing shipments by Seller on behalf of Purchaser to
  facilitate revenue recognition and earnings by Purchaser for all post-closing
  shipments, and for the transfer of customer warranty support in its entirety
  to Purchaser as of September 30, 2009.<br>
</p>
<p>2. <u><b>PURCHASE PRICE</b></u><br>
</p>
<p>2.1 <u>Purchase Price.</u> <br>
</p>
<p>The purchase price (the &quot;<u>Purchase Price</u>&quot;) for the Rights and
  Intangible and Tangible Assets, excluding Finished Product and Component Inventory
  items, described in Articles 1.1 (a), 1.1 (b) and 1.1 (c) will be $500,000.
  $450,000 is payable in full, via wire transfer of immediately available United
  States funds, at the Closing. The balance of $50,000 shall be payable upon the
  attainment by Purchaser of $250,000 in quarterly sales revenue from the sale
  of SocketSerial products in any quarter through and including the quarter ending
  December 31, 2010. The purchase price for the Finished Product and Component
  inventory items described in Article 1.1 (a) will be an amount equal to Seller's
  cost of these assets, such cost to consist of material, labor and overhead.</p>
<p align="center"><font face="Times New Roman, Times, serif">3</font></p>
<hr align="LEFT" size=4>
<p>2.2 <u>Allocation of Purchase Price.</u> <br>
</p>
<p>On the Closing Date, the Purchase Price for the Assets will be allocated in
  accordance with a schedule to be prepared by Purchaser which will be reasonably
  acceptable to Seller (the &quot;Allocation&quot;), which such Allocation shall
  be conclusive and binding on both the Purchaser and Seller. The parties agree
  to file tax returns reflecting the sale and purchase consistent with such schedule.
  <br>
</p>
<p>2.3 <u>Transfer Taxes. </u><br>
</p>
<p>Seller will be responsible for the payment of all transfer and sales taxes,
  if any, incurred in connection with the sale of the Assets to Purchaser.</p>
<p>3. <b><u>CLOSING</u></b><br>
</p>
<p>3.1 <u>Date and Time. </u><br>
</p>
<p>The closing of the transactions contemplated hereby (the &quot;Closing&quot;)
  shall take place simultaneously with the execution and delivery of this Agreement.
  The date of the Closing is hereinafter referred to as the &quot;Closing Date.&quot;
  The Closing shall be effective as of 4:00 p.m. Pacific time (which shall be
  considered the Close of Business time) on the Closing Date.</p>
<p>3.2 <u>Seller's Deliveries</u>. <br>
</p>
<p>At the Closing, Seller will execute and deliver, or cause to be executed and
  delivered, to Purchaser the following documents (collectively, the &quot;Related
  Agreements&quot;) or take, or cause to be taken, the following actions:<br>
</p>
<blockquote>
  <p>(a) A Bill of Sale for the Assets (conveying title thereto free and clear
    of all Encumbrances); <br>
  </p>
  <p>(b) An assignment of trademarks and proprietary rights agreement in the form
    attached hereto as Exhibit 3.2(d);<br>
  </p>
  <p>(c) The Supply and Licensing Agreement;<br>
  </p>
  <p>(d) Copies of resolutions of the board of directors of Seller authorizing
    the execution, delivery and performance of this Agreement and the other agreements
    contemplated by this Agreement and consummation of the transactions contemplated
    by thereby, which resolutions have been certified by the Secretary of Seller
    as being valid and in full force and effect; <br>
  </p>
  <p>(e) Those consents set forth on Schedule 4.3 hereto;<br>
  </p>
  <p>(f) All Encumbrances on the Assets shall be satisfied in full on or prior
    to Closing (or simultaneously therewith) and Seller shall have provided Purchaser
    with evidence of such satisfaction which is satisfactory to Purchaser; and<br>
  </p>
  <p>(g) Such other documents and certificates as are required by the terms of
    this Agreement or as may be reasonably requested by Purchaser.</p>
  <p align="center"><font face="Times New Roman, Times, serif">4</font></p>
</blockquote>
<hr align="LEFT" size=4>
<p>3.3 <u>Purchaser Deliveries. </u><br>
</p>
<p>At the Closing, Funder and Purchaser will:<br>
</p>
<blockquote>
  <p>(a) pay to Seller the Purchase Price;<br>
  </p>
  <p>(b) execute and deliver to Seller the Asset Purchase Agreement; <br>
  </p>
  <p>(c) deliver the Allocation pursuant to Section 2.2; and<br>
  </p>
  <p>(d) execute and deliver to Seller the Supply and Licensing Agreement.<br>
  </p>
</blockquote>
<p>3.4 <u>Inventory</u>.<br>
</p>
<blockquote>
  <p>(a) On or before the Closing, Purchaser may elect, at its sole discretion,
    to issue one or more purchase orders (the &quot;Purchase Orders,&quot; and
    each a &quot;Purchase Order&quot;) for delivery to Purchaser in September
    selected finished goods inventory (&quot;Inventory&quot;) of Seller, at a
    purchase price equal to Seller's cost of producing such finished goods inventory.
    Upon receipt of a Purchase Order, Seller shall be obligated to sell and deliver
    such Inventory to Purchaser on the terms set forth in this Article and in
    Article 1.5. <br>
  </p>
  <p>(b) Any Inventory purchased under a Purchase Order shall be subject to all
    of the terms and conditions of this Agreement including, but not limited to,
    the representations and warranties set forth in Article 4 hereof and the Seller's
    indemnification obligations set forth in Article 6 hereof.</p>
</blockquote>
<p>4. <u><b>REPRESENTATIONS AND WARRANTIES OF SELLER</b></u><br>
</p>
<p>The Seller hereby represents and warrants to, and covenants and agrees with,
  Purchaser that as of the date hereof:<br>
</p>
<p>4.1 <u>Organization of Seller; Authorizations. </u><br>
</p>
<p>Seller is a corporation duly organized, validly existing and in good standing
  under the laws of the State of Delaware. Seller has all requisite corporate
  power and authority to own or lease and operate its properties and to carry
  on its business as currently conducted and as proposed to be conducted and is
  qualified or licensed to do business and is in good standing in every jurisdiction
  where the nature of its business or the properties owned, leased or operated
  by it requires qualification or licensure, except where the failure to be so
  qualified or licensed would not have a material adverse effect on Seller or
  the operations of Seller.</p>
<p align="center"><font face="Times New Roman, Times, serif">5</font></p>
<hr align="LEFT" size=4>
<p>4.2 <u>Requisite Power and Authority. </u><br>
</p>
<p>Seller has all requisite corporate authority and power to execute and deliver
  this Agreement and to perform all transactions contemplated by this Agreement
  (the &quot;<u>Transactions</u>&quot;). The execution, delivery and performance
  by Seller of this Agreement have been duly authorized and approved by all necessary
  corporate action. Assuming the due authorization, execution and delivery by
  Purchaser, this Agreement constitutes a valid and binding agreement of Seller,
  enforceable against Seller in accordance with its terms, except as the enforceability
  of its terms may be limited by applicable bankruptcy, insolvency, reorganization,
  moratorium or similar laws affecting the enforceability of creditors' rights
  generally or by the principles governing the availability of equitable remedies.<br>
</p>
<p>4.3 <u>Seller's Requisite Consents; Nonviolation. </u><br>
</p>
<p>The execution and delivery of this Agreement and the consummation of the Transactions
  by Seller do not and will not, except as set forth on <u>Schedule 4.3</u> to
  this Agreement, (a) require the consent, license, permit, waiver, approval,
  authorization or other action of, by or with respect to, any person or entity
  (whether governmental or non-governmental), (b) violate or conflict with the
  provisions of the Articles of Incorporation or Bylaws, or other charter documents,
  of Seller, (c) constitute a default under, violate, conflict with, or result
  in the termination of, any Assigned Contract, agreement, judgment, order, injunction
  or decree to which Seller is a party, or by which Seller is bound or to which
  Seller, or any of its properties is subject, (d) conflict with or violate any
  law, rule or regulation of any Governmental Entity (as defined below in Section
  4.16(a)) having jurisdiction over Seller or any of its assets or properties,
  or (e) result in the creation or imposition of any Encumbrance on the Assets
  or in any person (other than Purchaser) obtaining the right to acquire any of
  the properties, rights or assets of Seller.<br>
</p>
<p>4.4 <u>No Undisclosed Liabilities. </u><br>
</p>
<p>Seller does not have any liability, commitment, obligation, loan or indebtedness
  of any nature whatsoever, whether as primary obligor, guarantor, surety or otherwise,
  whether known or unknown, whether accrued, absolute, contingent or otherwise,
  and whether due or to become due relating to the Business as currently conducted
  or as currently proposed to be conducted, the Assets or the Assumed Liabilities
  except as set forth on <u>Schedule 4.4. </u><br>
</p>
<p>4.5 <u>Title to Assets. </u><br>
</p>
<p>Seller has good, valid, exclusive and marketable title to the Assets, free
  and clear of all Encumbrances, and will transfer to Purchaser at the Closing
  good, valid, exclusive and marketable title to the Assets, free and clear of
  any Encumbrances.</p>
<p>4.6 <u>Assigned Contract Rights. </u><br>
</p>
<p>The Assigned Contract Rights constitute all of the material contract or agreement
  rights to which Seller is a party that relate to, or are used in, the Business.
  Each of the Assigned Contract rights is valid, in full force and effect and
  enforceable in accordance with its terms. There has not occurred any default
  or any event which, with notice or lapse of time or both, would become a default
  under any of the Assigned Contracts resulting from any act or omission by Seller
  or any act or omission of any other party thereto prior to the Closing Date,
  nor (ii) has there been a claim of any breach or default under any of the Assigned
  Contracts by Seller or by any other party thereto. Within the last twelve months,
  the Seller has not received any written notice that any person is canceling,
  modifying or terminating, and to the knowledge of the Seller, no person intends
  to cancel, modify, or terminate, any of the Assigned Contracts, or to exercise
  or not to exercise any option thereunder. True and complete copies of all Assigned
  Contract rights, including all related amendments, supplements and modifications,
  have been provided to Purchaser. </p>
<p align="center"><font face="Times New Roman, Times, serif">6</font></p>
<hr align="LEFT" size=4>
<p>4.7 <u>Litigation. </u><br>
</p>
<p>There is no pending or, to the knowledge of the Seller, threatened, litigation
  or judicial, administrative or arbitration claim, action or proceeding nor are
  there any judgments, orders, writs, injunctions or decrees currently in effect
  and involving or affecting any Asset or the Business.<br>
</p>
<p>4.8 <u>Intellectual Property</u>. <br>
</p>
<blockquote>
  <p>(a) Schedule 4.8(a) sets forth a complete and accurate list of (i) all Seller
    Proprietary Rights, including all such Intellectual Property owned, licensed
    or used by the Seller, all applications therefor, and all licenses, assignments
    and other agreements relating thereto to which the Seller is a party, and
    with respect to any mark, the date of first use of such mark in each respective
    country where such mark is used, and (ii) all Seller Licensed Proprietary
    Rights, including agreements relating to technology, know-how and processes
    with respect to such Intellectual Property that the Seller has licensed for
    its use or authorized for use by others.<br>
  </p>
  <p>(b) The Seller Proprietary Rights constitute all of the Intellectual Property
    related to, used in connection with, or useful or necessary for (x) the manufacture,
    use, sale, marketing, distribution, import and export of the Assets and Products
    of the Business, and (y) the conduct of the Business as currently conducted
    or as currently contemplated by the Seller to be conducted.<br>
  </p>
  <p>(c) The conduct of the Business as currently conducted or as currently contemplated
    by the Seller to be conducted does not and will not interfere with, conflict
    with, infringe upon, misappropriate or otherwise violate the Intellectual
    Property rights of any other person, and no action or claim has been asserted
    or is pending or is threatened alleging that the operation of such Business
    interferes with, conflicts with, infringes upon, misappropriates or otherwise
    violates the Intellectual Property rights of any other person and there is
    no basis therefor. After the Closing, Purchaser shall be able to manufacture,
    use, market, distribute, sell, import and export the Assets and conduct the
    Business as currently conducted or as currently contemplated by the Seller
    to be conducted without interfering with, conflicting with, infringing upon,
    misappropriating or otherwise violating the Intellectual Property rights of
    any other person.</p>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif">7</font></p>
<hr align="LEFT" size=4>
<p align="center">&nbsp; </p>
<blockquote>
  <p>(d) The Seller is the sole owner of the entire right, title and interest
    in and to, or has a valid exclusive license or other sufficient exclusive
    legal right under, the Seller Proprietary Rights. <br>
  </p>
  <p>(e) There are no outstanding options, licenses, Encumbrances or agreements
    of any kind relating to the Seller Proprietary Rights, nor is the Seller bound
    by or a party to any options, licenses, Encumbrances or agreements of any
    kind with respect to the Intellectual Property of any other person relating
    to or used in connection with the Business.<br>
  </p>
  <p>(f) The Seller Proprietary Rights are valid and enforceable, and the same
    have not been adjudged invalid or unenforceable in whole or in part. The Seller
    has complied with all of its obligations of confidentiality in respect of
    the claimed trade secrets or proprietary information of others with respect
    to the Business and there are no violations of such obligations of confidentiality
    as are owed to them with respect to the Business.<br>
  </p>
  <p>(g) No claims or actions have been asserted, are pending or threatened against
    the Seller (i) based upon or challenging or seeking to deny or restrict the
    exclusive ownership by, inventorship of, or exclusive use or license rights
    of the Seller of any of the Seller Proprietary Rights, (ii) alleging that
    (x) the Seller Proprietary Rights, (y) the development, manufacture, distribution,
    marketing, use or sale of the products of the Business, or (z) any services
    provided, processed or used by the Seller relating to or used in connection
    with the Business, infringe or misappropriate any Intellectual Property right
    of any third party, or (iii) alleging that the Seller Licensed Proprietary
    Rights are being licensed or sublicensed in conflict with the terms of any
    license or other agreement, and there is no basis for such a claim with respect
    to any of the foregoing.<br>
  </p>
  <p>(h) No person is engaging in any activity that infringes or misappropriates
    the Seller Proprietary Rights. The Seller has not granted any license or other
    right to any third party with respect to the Seller Proprietary Rights. The
    execution and delivery by the Seller of this Agreement and the Related Agreements,
    the performance by the Seller of its obligations hereunder or thereunder,
    and the consummation of the transactions contemplated hereby and thereby will
    not breach, violate or conflict with any instrument or agreement concerning
    the Seller Proprietary Rights, will not cause the forfeiture or termination
    or give rise to a right of forfeiture or termination of any of the Seller
    Proprietary Rights or impair the right of Purchaser or any of its affiliates
    to license or dispose of, or to bring any action for the infringement of,
    any Seller Proprietary Rights.</p>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif">8</font></p>
<hr align="LEFT" size=4>
<p><br>
</p>
<blockquote>
  <p>(i) The Seller has delivered to Purchaser correct and complete copies of
    all licenses of the Seller Licensed Proprietary Rights, other than licenses
    of commercial off-the-shelf computer software. With respect to each such license:<br>
  </p>
  <blockquote>
    <p>(i) such license is valid and binding and in full force and effect and
      represents the entire agreement between the respective licensor and licensee
      with respect to the subject matter of such license;<br>
    </p>
    <p>(ii) such license will not cease to be valid and binding and in full force
      and effect on terms identical in all material respects to those currently
      in effect as a result of the consummation of the transactions contemplated
      by this Agreement, nor will the consummation of the transactions contemplated
      by this Agreement constitute a breach or default under such license or otherwise
      so as to give the licensor or any other person a right to terminate such
      license;<br>
    </p>
    <p>(iii) the Seller has not (A) received any notice of termination or cancellation
      under such license, (B) received any notice of breach or default under such
      license, which breach has not been cured, or (C) granted to any other person
      any rights, adverse or otherwise, under such license that would constitute
      a breach of such license; <br>
    </p>
    <p>(iv) neither the Seller nor any other party to such license is in breach
      or default thereof, and no event has occurred that, with notice or lapse
      of time, would constitute such a breach or default or permit termination,
      modification or acceleration under such license; and<br>
    </p>
    <p>(v) no consent, approval, permit, order or authorization of, or registration,
      qualification, designation, declaration or filing with, any Governmental
      Entity or other person is necessary in order for such license to remain
      in full force and effect following the consummation of the transactions
      contemplated by this Agreement and the Related Agreements.<br>
    </p>
  </blockquote>
  <p>(j) None of the Seller's employees, officers, directors, agents or consultants
    is (i) subject to confidentiality restrictions in favor of any third person
    the breach of which with respect to the Business could subject the Seller
    to any liability, or (ii) obligated under any contract (including licenses,
    covenants or commitments of any nature) or other agreement, or subject to
    any judgment, decree or order of any court or administrative agency, that
    would interfere with their duties to the Seller or that would conflict with
    the Business as currently conducted or currently proposed to be conducted.
    Each employee and officer of and consultant to the Seller that has performed
    services with respect to the Business has executed a proprietary information
    and inventions agreement of the Seller substantially similar to the form delivered
    by Seller to Purchaser as of the date hereof. No current or former employee
    or officer of or consultant to the Seller has excluded works or inventions
    made prior to his or her employment or relationship with the Seller from his
    or her assignment of inventions pursuant to such employee's, officer's or
    consultant's proprietary information and inventions agreement in any way relating
    to the Business or that could reasonably be expected to affect the Seller
    Proprietary Rights.</p>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif">9</font></p>
<hr align="LEFT" size=4>
<blockquote>
  <p>(k) The Seller has taken reasonable steps in accordance with normal industry
    practice to maintain the confidentiality of its trade secrets and other confidential
    Intellectual Property. There has been no misappropriation of any trade secrets
    or other confidential Seller Proprietary Rights by any person. No employee,
    independent contractor or agent of the Seller has misappropriated any trade
    secrets of any other person in the course of such performance as an employee,
    independent contractor or agent with respect to the Business. No employee,
    independent contractor or agent of the Seller is in default or breach of any
    term of any employment agreement, non-disclosure agreement, assignment of
    inventions agreement or similar agreement or contract relating in any way
    to the protection, ownership, development, use or transfer of Seller Proprietary
    Rights.<br>
  </p>
  <p>(l) Neither the execution nor delivery of this Agreement or the Related Agreements,
    nor the manufacturing, use, sale, marketing, distribution, import or export
    of the Assets or products of the Business, nor the carrying on of the Business
    by the employees of and consultants to the Seller, nor the conduct of the
    Business as presently conducted or as proposed to be conducted by the Seller,
    will conflict with or result in a breach of the terms, conditions or provisions
    of, or constitute a default under, any contract, covenant or instrument under
    which any of such employees is now obligated. Except to the extent already
    assigned to the Seller, the Seller does not believe that it is or will be
    necessary to utilize any inventions or proprietary information of any of its
    employees or consultants (or people it currently intends to hire) made prior
    to their employment by the Seller in order to manufacture, use or sell the
    Assets or Seller Proprietary Rights.<br>
  </p>
  <p>(m) The Seller has not (i) abandoned, sold, or granted any security interest
    in or to any Seller Proprietary Rights, including failing to perform or cause
    to be performed all applicable filings, recordings and other acts, and pay
    or cause to be paid all required fees, royalties and taxes, to maintain and
    protect its interest in such Seller Proprietary Rights, (ii) developed, created
    or invented any Seller Proprietary Rights jointly with any third party with
    respect to which the Seller would not retain full ownership in such Seller
    Proprietary Rights, or (iii) disclosed, or allowed to be disclosed, any confidential
    Seller Proprietary Rights, unless such Seller Proprietary Rights are subject
    to a confidentiality and non-disclosure covenant protecting against disclosure
    thereof.<br>
  </p>
  <p>(n) For the purposes of this Agreement &quot;Intellectual Property&quot;
    means intellectual property or proprietary rights of any description related
    to or used or useful in connection with the Assets or the Business, including
    (a) rights in any patent, patent registration, patent application (including
    any provisionals, continuations, divisions, continuations-in-part, extensions,
    renewals, reissues, revivals and reexaminations, any national phase PCT applications,
    any PCT international applications, and all foreign counterparts, including
    utility models and utility model applications), copyright, work for hire,
    industrial design, URL, domain name, trademark, service mark, logo, trade
    dress or trade name, (b) related registrations and applications for registration,
    (c) trade secrets, moral rights, shop rights or publicity rights, (d) inventions,
    discoveries, or improvements, modification, know-how, technique, methodology,
    writing, work of authorship, design or data, whether or not patented, patentable,
    copyrightable or reduced to practice, including any inventions, discoveries,
    improvements, modification, know-how, technique, methodology, writing, work
    of authorship, design or data embodied or disclosed in any: (i) computer source
    codes (human readable format) and object codes (machine readable format);
    (ii) specifications; (iii) manufacturing, assembly, test, installation, service
    and inspection instructions and procedures; (iv) engineering, programming,
    service and maintenance notes and logs; (v) technical, operating and service
    and maintenance manuals and data; (vi) hardware reference manuals; and (vii)
    user documentation, help files or training materials, and (e) good will related
    to any of the foregoing. </p>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif">10</font></p>
<hr align="LEFT" size=4>
<p>4.9 <u>Compliance with Laws.</u><br>
</p>
<p>Seller is in compliance with all material federal, state, local, municipal
  and foreign laws, rules, regulations, statutes and ordinances applicable to
  Seller relating to the Business or any of the Assets.<br>
</p>
<p>4.10 <u>Tangible Assets.</u> <br>
</p>
<p>All tangible Assets of Seller are in good repair and good operating condition,
  ordinary wear and tear excepted, and are adequate and sufficient to carry on
  the Business as presently conducted.<br>
</p>
<p>4.11 <u>Inventory. </u><br>
</p>
<p>Any Inventory which will be sold to Purchaser pursuant to the Purchase Orders
  is merchantable, actively being purchased by Seller's customers as of the Closing
  Date and fit for the purpose for which it was procured or manufactured. As of
  the Closing Date, none of the Seller's finished goods Inventory is slow moving,
  and none of Seller's Inventory is obsolete, in packaging that is not being used
  by Seller and its customers, in packaging that is scheduled to be replaced or
  discontinued, a product that has been, or is scheduled to be or is contemplated
  to be discontinued, phased out or replaced. None of the Inventory is damaged
  or defective. Exceptions to this Article are listed in Schedule 4.11.<br>
</p>
<p>5.<u><b> OTHER COVENANTS</b></u><br>
</p>
<p>5.1 <u>Expenses. </u><br>
</p>
<p>Each party will bear its own fees and expenses related to this transaction
  (including legal, accounting or other professional fees and expenses), whether
  or not the transaction is consummated.<br>
</p>
<p>5.2 <u>Books and Records. <br>
  </u> </p>
<p>Following the Closing Date and for a period of five (5) years thereafter, Seller
  will maintain all books and records and tax statements and returns relating
  solely to the Business and will provide copies thereof to Purchaser promptly
  upon request.</p>
<p align="center"><font face="Times New Roman, Times, serif">11</font></p>
<hr align="LEFT" size=4>
<p>5.3 <u>Bulk Transfer Laws</u>. <br>
</p>
<p>The parties do not believe that any laws relating to bulk sales or bulk transfers
  (including any such laws under the Uniform Commercial Code) are applicable to
  any of the Transactions. Notwithstanding the foregoing, and in order to induce
  Purchaser to execute this Agreement and consummate the Transactions, Seller
  will indemnify and defend Purchaser and its affiliates and hold them harmless
  (in accordance with Section 6.1 below) from and against any claim or other expense
  arising out of, resulting from or relating to, any determination of the applicability
  to any of the Transactions of, or failure to comply with in connection with
  any of the Transactions, any of such laws.<br>
</p>
<p>5.4 <u>Confidentiality. </u><br>
</p>
<p>From and after the Closing Date, the Seller will keep confidential and will
  not directly or indirectly disseminate, disclose, use, communicate, divulge
  or otherwise appropriate any of the Confidential Information (as defined below).
  From and after the Closing Date, the Seller will take all steps necessary or
  requested by Purchaser to ensure that all of the Confidential Information is
  kept secret and confidential for the sole use and benefit of Purchaser. All
  Confidential Information will be the exclusive property of Purchaser, and Seller
  will promptly deliver to Purchaser all Confidential Information, including all
  copies thereof, which is in Seller's possession or under Seller's control, without
  making or retaining any copies or extracts thereof. As used in this Agreement,
  &quot;<u>Confidential Information</u>&quot; means and includes all information,
  whether now possessed or subsequently obtained or developed, relating to the
  business of Purchaser or the business of the Seller as conducted prior to Closing,
  except for information that otherwise is publicly known. <br>
</p>
<p>5.5 <u>Publicity.<br>
  </u> </p>
<p>None of the parties hereto will issue any press release or other information
  to the press or any third party with respect to the terms of this Agreement
  or the consummation of the Transaction without the express written consent of
  the other parties, provided, however, that the parties may release information
  contained in, or relating to, this Agreement or the consummation of the Transaction
  pursuant to a requirement of law, court proceeding or governmental decree.<br>
</p>
<p>5.6 <u>Discontinuation of Operations.</u><br>
</p>
<p>Other than Seller's fulfillment of its obligations pursuant to the Transitional
  Services Agreement, Seller agrees that it will discontinue all operations of
  any kind whatsoever related to the Business, including the design, manufacture,
  distribution and sales of the Assets, pursuant to the mutually agreed upon schedule
  with Purchaser specified in the Transitional Services Agreement. </p>
<p>5.7 <u>Non-competition.</u><br>
</p>
<p>The Seller agrees that for a period of three (3) years after the date hereof,
  it will not:<br>
</p>
<blockquote>
  <p>(a) invest in, own, manage, operate, finance, control, advise, render services
    to or guarantee the obligations of any person or entity engaged in the Business
    or the design, manufacture, distribution or sales of products similar to the
    Assets or the Products, anywhere in the United States.;</p>
  <p align="center"><font face="Times New Roman, Times, serif">12</font></p>
</blockquote>
<hr align="LEFT" size=4>
<blockquote>
  <p><br>
  </p>
  <p>(b) Directly or indirectly contact any customer of the Business or any customer
    of Purchaser for the purpose of soliciting such customer to purchase, lease
    or license a product or service that would be in competition with those products
    or services made, rendered, offered or under development by the Purchaser;
    or<br>
  </p>
  <p>(c) Directly or indirectly interfere with or attempt to disrupt the relationship,
    contractual or otherwise, between the Purchaser and any of its employees or
    solicit an employee of the Purchaser to terminate employment with the Purchaser
    and become self-employed or employed with others in the same or similar business.<br>
  </p>
</blockquote>
<p>The existence of any claim, dispute, or cause of action of the Seller against
  the Purchaser, whether predicated on this Agreement or otherwise, will not constitute
  a defense to the enforcement by the Purchaser of this covenant.<br>
</p>
<p>5.8 <u>Remedies </u><br>
</p>
<p>Seller acknowledges and agrees that its respective obligations under Sections
  5.4, 5.5, 5.6 and 5.7 above are of a special, unique and extraordinary character,
  that they are reasonably related to the legitimate business interests of Purchaser,
  and that a failure to perform any such obligation or a violation of such obligations
  will cause irreparable injury to Purchaser, the amount of which would be impossible
  to estimate or determine and for which adequate compensation could not be fashioned.
  Therefore, Seller agrees that Purchaser will be entitled, as a matter of right,
  and without the need to prove irreparable injury or to post bond, to an injunction,
  restraining order, writ of mandamus or other equitable relief (including specific
  performance) from any court of competent jurisdiction, restraining any violation
  or threatened violation of any term of such Sections 5.4, 5.5, 5.6 or 5.7 or
  requiring compliance with or performance of any obligation thereunder, by Seller
  and such other persons as the court will order. The rights and remedies provided
  Purchaser hereunder are cumulative and will be in addition to the rights and
  remedies otherwise available to Purchaser under any other agreement or applicable
  law.<br>
</p>
<p>5.9 <u>Insurance and Access.</u><br>
</p>
<blockquote>
  <p>(a) Seller agrees to cooperate with Purchaser, as may be reasonably necessary,
    in order to make available to Purchaser any existing insurance coverage held
    by Seller on which Seller is a named insured relating to occurrences prior
    to Closing (the &quot;Seller Policies&quot;). In the event of an occurrence
    which Purchaser believes may be covered by one or more Seller Policies, Purchaser
    shall, after consultation with Seller, submit a claim for such occurrence
    to the appropriate insurer under the applicable Seller Policy. Seller agrees
    to provide such reasonable assistance as Purchaser may require in order to
    pursue such claim with the insurer, including, if necessary, acting as the
    direct contact for all purposes with such insurer and pursuing such claim
    on behalf of Purchaser.<br>
  </p>
  <p>(b) Seller shall for a period of five years after the Closing Date, during
    normal business hours and upon not less than three business days written notice,
    provide Purchaser and its representatives with such access to the books and
    records of Seller as may be reasonably requested by Purchaser, who shall be
    entitled, at its expense, to copy such books and records. Seller shall not,
    during such five-year period, destroy or cause or permit to be destroyed any
    books or records without first obtaining the consent of Purchaser (or providing
    to Purchaser notice of such intent and a reasonable opportunity to copy such
    books or records at least 30 days prior to such destruction).<br>
  </p>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif">13</font></p>
<hr align="LEFT" size=4>
<p>5.10 <u>Litigation Support. </u><br>
</p>
<p>If and for so long as Purchaser or Seller are actively contesting or defending
  against any action in connection with any fact, situation, circumstance, status,
  condition, activity, practice, plan, occurrence, event, incident, action, failure
  to act, or transaction which occurred prior to the Closing Date involving the
  Seller, Seller shall cooperate with Purchaser or Purchaser's counsel in the
  defense or contest, make available their personnel on a mutually convenient
  basis and provide such testimony and reasonable access to Seller's books and
  records as shall be reasonably necessary in connection with the defense or contest.<br>
</p>
<p>5.11 <u>Post Closing Accounts Receivable. </u><br>
</p>
<p>Purchaser and Seller acknowledge and agree that in the event that one party
  receives (the &quot;<u>Receiving Party</u>&quot;) payment with respect to an
  outstanding account receivable (the &quot;<u>AR Amount</u>&quot;) that was intended
  as payment for the other party (the &quot;<u>Proper Party</u>&quot;), the Receiving
  Party shall promptly, but in no event later than five (5) business days after
  receipt of the AR Amount, issue payment for the full AR Amount to the Proper
  Party.<br>
</p>
<p>5.12 <u>Product Returns. </u><br>
</p>
<p>Seller acknowledges and agrees that it will be solely responsible for any and
  all returns, offsets, discounts, credits, contractual allowances, setoffs or
  any other reduction in price (collectively, the &quot;<u>Returns</u>&quot;)
  from a third party related to the sale of any of the Assets prior to the Closing
  Date. Upon receipt of any Returns, Purchaser shall provide Seller with a reasonably
  detailed list outlining all Returns by customer and setting forth an aggregate
  dollar amount of the Returns (the &quot;<u>Returns Notice</u>&quot;). Seller
  acknowledges that in the event that Purchaser is subject to any Returns and
  once Purchaser has delivered a Returns Notice, Purchaser shall be entitled to
  make a claim for Losses pursuant to Article 6 below.<br>
</p>
<p>6. <b><u>INDEMNIFICATION</u></b><br>
</p>
<p>6.1 <u>Indemnification by the Seller. </u><br>
</p>
<p>Without limiting any other rights or remedies available to Purchaser, the Seller
  will indemnify, defend and hold harmless Purchaser and its affiliates and their
  respective officers, directors, members, managers, employees and shareholders
  from (collectively, &quot;<u>Affiliates</u>&quot;), against and with respect
  to any claim, liability, obligation, loss, damage, assessment, judgment, settlement,
  cost and expense (including costs attributable to the loss of the use of funds
  to the date on which the indemnification payment is made hereunder, reasonable
  attorneys' and accountants' fees, and costs and expenses reasonably incurred
  in investigating, preparing, defending against or prosecuting any litigation
  or claim, action, suit, proceeding or demand), of any kind or character (collectively,
  the &quot;Losses&quot;) arising out of or in any manner incident, relating or
  attributable to: </p>
<p align="center"><font face="Times New Roman, Times, serif">14</font></p>
<hr align="LEFT" size=4>
<p><br>
</p>
<blockquote>
  <p>(a) any inaccuracy or breach in any representation or breach of any warranty
    of Seller contained in this Agreement, in any of the Related Agreements or
    in any certificate, instrument of transfer or other document or agreement
    executed by Seller in connection with this Agreement;<br>
  </p>
  <p>(b) any failure by Seller to perform or observe any covenant or agreement
    to be performed or observed by it or on its behalf under this Agreement, in
    any of the Related Agreements or under any certificates or other documents
    or agreements executed by Seller in connection with this Agreement; <br>
  </p>
  <p>(c) all Excluded Liabilities;<br>
  </p>
  <p>(d) any claim, allegation or assertion that the development, manufacture,
    marketing, distribution or sale of any Asset or product in the Business product
    line by Seller on or prior to the Closing Date that allegedly or actually
    infringes, violates or misappropriates any Intellectual Property or other
    proprietary rights of such third party; and<br>
  </p>
  <p>(e) all Returns.</p>
</blockquote>
<p>6.2 <u>Indemnification by the Purchaser. </u><br>
</p>
<p>Without limiting any other rights or remedies available to Seller, the Purchaser
  will indemnify, defend and hold harmless Seller and its Affiliates from, against
  and with respect to any Losses arising out of or in any manner incident, relating
  or attributable to:<br>
</p>
<blockquote>
  <p>(a) any inaccuracy or breach in any representation or breach of any warranty
    of Purchaser contained in this Agreement, in any of the Related Agreements
    or in any certificate, instrument of transfer or other document or agreement
    executed by Purchaser in connection with this Agreement;<br>
  </p>
  <p>(b) any failure by Purchaser to perform or observe any covenant or agreement
    to be performed or observed by it or on its behalf under this Agreement, in
    any of the Related Agreements or under any certificates or other documents
    or agreements executed by Seller in connection with this Agreement; <br>
  </p>
  <p>(c) all Assumed Liabilities; and<br>
  </p>
  <p>(d) any claim, allegation or assertion that the development, manufacture,
    marketing, distribution or sale of any Asset or product in the Business product
    line by Seller prior to the Closing Date that allegedly or actually infringes,
    violates or misappropriates any Intellectual Property or other proprietary
    rights of such third party.</p>
  <p align="center"><font face="Times New Roman, Times, serif">15</font></p>
</blockquote>
<hr align="LEFT" size=4>
<p>7. <u><b>MISCELLANEOUS</b></u><br>
</p>
<p>7.1 <u>No Waiver. </u><br>
</p>
<p>No waiver of any breach of any agreement or provision herein contained will
  be deemed a waiver of any preceding or succeeding breach thereof or of any other
  agreement or provision herein contained. No extension of time for performance
  of any obligations or acts will be deemed an extension of the time for performance
  of any other obligations or acts.<br>
</p>
<p>7.2 <u>Successors and Assigns. </u><br>
</p>
<p>This Agreement will bind and inure to the benefit of the parties hereto and
  their successors and assigns. Purchaser may, without the consent of Seller,
  assign its rights and obligations under this Agreement to a third party.<br>
</p>
<p>7.3<u> Notices. </u><br>
</p>
<p>Any notice required or permitted to be given hereunder pursuant to this Agreement
  will be sent by certified or registered mail, postage prepaid, as follows: </p>
<table width="62%" border="0" cellspacing="0" cellpadding="0" align="center">
  <tr>
    <td width="28%" align="left" valign="top">To Purchaser:</td>
    <td width="4%">&nbsp;</td>
    <td width="68%">Quatech Inc.<br>
      5675 Hudson Industrial Park<br>
      Hudson, Ohio 44236<br>
      Attn: Steven D. Runkel<br>
      Telephone: (330) 655-9000</td>
  </tr>
  <tr>
    <td width="28%" align="left" valign="top">&nbsp;</td>
    <td width="4%">&nbsp;</td>
    <td width="68%">&nbsp;</td>
  </tr>
  <tr>
    <td width="28%" align="left" valign="top">With a copy (not constituting notice)
      to:</td>
    <td width="4%">&nbsp;</td>
    <td width="68%">Buchanan Ingersoll &amp; Rooney PC<br>
      One Oxford Centre<br>
      301 Grant St., 20th Floor<br>
      Pittsburgh, PA 15219<br>
      Attn: Perry S. Patterson, Esq.<br>
      Telephone: 412-562-8445<br>
      Facsimile: 412-562-1041</td>
  </tr>
  <tr>
    <td width="28%" align="left" valign="top">&nbsp;</td>
    <td width="4%">&nbsp;</td>
    <td width="68%">&nbsp;</td>
  </tr>
  <tr>
    <td width="28%" align="left" valign="top">To Seller:</td>
    <td width="4%">&nbsp;&nbsp;</td>
    <td width="68%">Socket Mobile, Inc.<br>
      39700 Eureka Drive<br>
      Newark, CA 94560<br>
      Attn: Kevin Mills<br>
      Telephone: (510) 933-3111<br>
      Facsimile: (510) 933-3104</td>
  </tr>
</table>
<p>&nbsp;</p>
<p>7.4 <u>Survival of Obligations. </u><br>
</p>
<p>Except as otherwise provided herein or therein, the provisions of this Agreement
  and of any other document delivered hereunder will continue and will survive
  for eighteen (18) months following the execution and delivery of this Agreement
  and consummation of the Transactions. Notwithstanding the foregoing, (i) the
  covenants, representations, warranties set forth in Article 4 above which are
  breached as a result of fraud and/or willful or intentional breaches shall survive
  indefinitely and shall not expire and (ii) Purchaser's rights and Seller's obligations
  under Sections 5.10, 5.11, 5.12 and 5.13 shall survive indefinitely and shall
  not expire.</p>
<p align="center"><font face="Times New Roman, Times, serif">16</font></p>
<hr align="LEFT" size=4>
<p>7.5 <u>Complete Agreement. </u><br>
</p>
<p>This Agreement, the Related Agreements, and the exhibits and schedules hereto
  and thereto contain the complete agreement of the parties with respect to the
  purchase and sale of the Assets and the Inventory, and no representations made
  by any party may be relied on unless set forth herein, therein or in such exhibits
  or schedules hereto or thereto. This Agreement may be altered or amended only
  by an instrument in writing, duly executed by all of the parties hereto.<br>
</p>
<p>7.6 <u>Applicable Law; Jurisdiction. </u><br>
</p>
<p>All questions concerning the construction, validity and interpretation of this
  Agreement will be governed by and construed in accordance with the domestic
  laws of the State of Ohio, without giving effect to any choice of law or conflict
  of law provision or rule (whether of the State of Ohio or any other jurisdiction)
  that would cause the application of the laws of any jurisdiction other than
  the State of Ohio. Any lawsuit arising out of or in any way related to this
  Agreement to the parties' relationship hereunder shall be brought only in those
  state or federal courts having jurisdiction over actions arising in the State
  of Ohio.<br>
</p>
<p>7.7 <u>Counterparts. </u><br>
</p>
<p>This Agreement may be signed in any number of counterparts, with the same effect
  as if all signatures were upon the same instrument.<br>
</p>
<p>7.8 <u>Further Assurances. </u><br>
</p>
<p>Each party covenants that at any time, and from time to time, before or after
  the Closing Date, it will execute such additional instruments and take such
  actions as may be reasonably requested by the other party to carry out the intent
  and purposes of this Agreement.</p>
<p align="center"><br>
  <b>[The remainder of this page has been intentionally left blank]</b></p>
<p><br>
</p>
<p align="center"><font face="Times New Roman, Times, serif">17</font></p>
<hr align="LEFT" size=4>
<p><br>
  IN WITNESS WHEREOF, the parties hereto have executed this Asset Purchase Agreement
  as of the day and year first above written.</p>
<blockquote>
  <blockquote>
    <blockquote>
      <blockquote>
        <blockquote>
          <blockquote>
            <blockquote>
              <p><br>
                <b>Quatech Inc.</b></p>
              <p> By: /s/ Steven D. Runkel<br>
                Steven D. Runkel, President </p>
              <p>&nbsp;</p>
              <p><b>Socket Mobile, Inc.</b></p>
              <p> By: /s/ Kevin J. Mills<br>
                Kevin J. Mills, President and CEO</p>
              <p>&nbsp;</p>
              <p><b> Development Capital Ventures, LP</b></p>
              <p>By: /s/ Donald L. Murfin<br>
                Donald L. Murfin, Executive Vice President,<br>
                DCC Operating, Inc. General Partner <br>
              </p>
              <p>&nbsp;</p>
            </blockquote>
          </blockquote>
        </blockquote>
      </blockquote>
    </blockquote>
  </blockquote>
</blockquote>
<p align="center"><font face="Times New Roman, Times, serif">18</font></p>
<hr align="LEFT" size=4>
<p>&nbsp;</p>
<blockquote>
  <blockquote>
    <blockquote>
      <blockquote>
        <blockquote>
          <blockquote>
            <blockquote>
              <p align="center"><u>Schedule 1.1(a)</u></p>
            </blockquote>
          </blockquote>
        </blockquote>
      </blockquote>
    </blockquote>
  </blockquote>
</blockquote>
<p align="center">Assets</p>
<p>The Assets included in this sale are Seller's entire stock and inventory of
  (including new Products returned from Seller's distributors whose distributor
  rights have been cancelled), and all of its rights, title and interest in and
  to, the following:</p>
<p><u>&quot;Products&quot;</u><br>
  CF Serial Card Removable cable and ruggedized (fixed cable)<br>
  PC Serial Card Removable cable and ruggedized (fixed cable)<br>
  PC Dual Serial Card Removable cable and ruggedized (fixed cable)<br>
  PC Quad Serial Card Removable cable and ruggedized (fixed cable)<br>
  USB to Serial Adapter <br>
  USB to Ethernet Adapter</p>
<p><u>&quot;Other assets&quot;</u><br>
  Tooling owned by Seller used in the manufacture of the Products; <br>
  Product accessories and components (with the exception of the Chips and Chip
  Specifications); <br>
  All serial driver software and the source code and related documentation therefor;
  and <br>
  All engineering drawings, specifications and data sheets for the Products.<br>
  &quot;Socket Serial&quot; website<br>
  All planning materials for a BC04 Bluetooth Cordless Serial Adapter &quot;as
  is&quot;.<br>
  Excel files containing: <br>
</p>
<ul>
  <li>Registered serial product user information from Purchaser's registration
    data base<br>
    <br>
  </li>
  <li> Customer service history information from Purchaser's customer service
    data base<br>
    <br>
  </li>
  <li> Information identifying members of Purchaser's Customer Advisory Board</li>
</ul>
<p align="center"><font face="Times New Roman, Times, serif">19</font></p>
<hr align="LEFT" size=4>
<p align="center"> <br>
  <u>Schedule 1.1(b)</u></p>
<p align="center">Changes relating to Seller's Contracts</p>
<p>Distributor Agreements: Seller agrees that commencing with the date of closing
  of this Agreement, Seller will advise each of its distributors of the sale of
  the serial business and the continuation of the serial business by Purchaser.
  In addition, Seller shall provide each distributor with a notice of discontinuation
  of the serial product assets by Seller and the availability of the serial product
  assets from Purchaser, all in accordance with the transition steps described
  in Schedule 1.5.</p>
<p>Supplier Agreements: Seller agrees that commencing with the date of closing
  of this Agreement, Seller will advise each supplier of its serial product components
  of the sale of the serial business and the continuation of the serial business
  by Purchaser. Seller shall also advise each supplier of the transfer of ownership
  of any serial product tooling and intellectual property used or held by supplier.</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif">20</font></p>
<hr align="LEFT" size=4>
<p align="center"><br>
  <br>
  <u>Schedule 1.1(c)</u></p>
<p align="center">Intangible Assets</p>
<p>Exclusive use of the name &quot;Socket Serial&quot; and related TM trademarks</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif">21</font></p>
<hr align="LEFT" size=4>
<p align="center"> <br>
  <u>Schedule 1.2</u></p>
<p align="center">Assumed Liabilities</p>
<p>Seller warrants its serial products to perform in accordance with product specifications
  for a period of one year. Such warranty includes a number of exclusions including
  abuse or intentional damage, use in an unintended manner or environment and
  incompatibility. Seller's remedies are to repair or replace the product.</p>
<p>Seller and Purchaser intend to transfer customer support responsibilities from
  Seller to Purchaser and Purchaser will honor Seller's warranty commitments.
  Purchaser shall charge Seller and Seller shall reimburse purchaser for the cost
  of warranty support for serial products sold by Seller prior to the closing
  date of the Purchase.</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif">22</font></p>
<hr align="LEFT" size=4>
<p align="center"><br>
  <br>
  Exhibit 1.4</p>
<p align="center">Supply and Licensing Agreement</p>
<p align="center">[To be inserted]</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center"></p>
<p align="center"></p>
<p align="center">&nbsp; </p>
<p align="center"><font face="Times New Roman, Times, serif">23</font></p>
<hr align="LEFT" size=4>
<p align="center"><br>
  Schedule 1.5</p>
<p align="center">Transition Services</p>
<p>Seller and Purchaser wish to insure a smooth transition from seller to buyer
  without disruption of product flow or support to customers. Following is a general
  outline of the intent of the parties in achieving such transition.</p>
<p>Timely notification of suppliers and customers. Seller and Purchaser shall
  notify suppliers and customers of the sale/purchase of the serial product line
  and cooperate in enabling suppliers and distributors to establish relationships
  with Purchaser.</p>
<p>Transfer of finished goods. Purchaser may order finished goods from Seller
  for delivery during September while supplier arrangements are being activated.
  Such goods shall be transferred at Socket cost.</p>
<p>Post-closing support of distributors. Seller's distributors generally have
  30 days from the date of notification (first item above) to continue to obtain
  product from Seller and to return product to Seller. Seller will continue to
  supply distributors post closing as an agent for Purchaser and shall supply
  Purchaser with detailed information of products shipped by customer. All shipments
  post closing shall be to the benefit of Purchaser including recognition of the
  revenue. The margin (revenue less product cost) shall be paid by Seller to Purchaser
  as agreed between the parties.</p>
<p>Inventories on hand consist of finished goods, useable components. Inventories
  are also consigned to various suppliers. Seller shall continue to use these
  inventories to build product for or on behalf of Purchaser. On completion of
  this transition (expected around the end of September), a detail listing of
  inventories on hand and consigned inventories shall be prepared by seller for
  transfer to Purchaser at seller's cost. The determination of useable inventories
  shall be at the sole discretion of Purchaser.</p>
<p>Customer warranty support shall be continued by Seller until transitioned to
  Purchaser as described in Schedule 1.2. Such transition is expected to occur
  approximately one month after closing.</p>
<p align="center">&nbsp; </p>
<p align="center"><font face="Times New Roman, Times, serif">24</font></p>
<hr align="LEFT" size=4>
<p align="center"><br>
  <br>
  Schedule 4.3</p>
<p align="center">Consents</p>
<p>Approval to close the transaction from Seller's Board of Directors</p>
<p>Approval to sell the assets from Seller's bank, Silicon Valley Bank. Seller's
  bank line of credit is secured by all assets of Seller and sale of assets other
  than in the ordinary course of business requires the approval of the Bank.</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif">25</font></p>
<hr align="LEFT" size=4>
<p>&nbsp;</p>
<p align="center"> <br>
  Schedule 4.11</p>
<p align="center"><u>Inventory </u></p>
<p><u><b>Cordless Serial Adapter (CSA)</b></u><br>
  The Cordless Serial Adapter (CSA) includes a BC02 Bluetooth module that has
  been given end of life status due to the discontinuation of the manufacture
  of the BC02 chip by its manufacturer. Seller has approximately 1,700 CSA products
  manufactured and has approximately 2,100 BC02 modules that can be used to manufacture
  an additional 2,100 CSA products. Purchaser is acquiring the 1,700 CSA products
  by March 31, 2009 and will advise Seller by October 31, 2009 as to what number
  of BC02 modules will be acquired to enable additional CSA units to be manufactured.
</p>
<p><b><u>CompactFlash Rugged IO (CF+RIO)</u></b><br>
  The 15 pin internal connector used on the CF+RIO is EOL. Socket is currently
  working with a final 2K quantity from our supplier and do not have an alternative
  connector available. Socket's going forward plan would be to re-layout the PCB
  to physically fit into another one of Socket's CF cases and adjust the over-mold
  design on the end of the cable to work with the adjusted configuration. This
  is not considered a major effort, but should get started this quarter to prevent
  any interruption in the overall channel supply based on current inventory. The
  overall effort will take a few weeks. Adjusted design with case would still
  be ordered from our current supplier. The change will warrant updates to the
  physical properties listed on data sheets and documentation images, as well
  as web site images.</p>
<p><b><u>Removable Serial Cables </u></b><br>
  The 15 pin connector used on the Removable Serial Cables (PN 8100-00016) has
  just gone EoL. This has just been confirmed by our supplier. Socket has been
  anticipating this and already as some new sample prototypes being built using
  a standard Honda 15 pin connector which can be procured from market sources.
  Socket is having these samples delivered for review and approval. Socket will
  provide an update after review and approval of the connector samples being received
  from our Taiwan supplier.</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif">26</font></p>
<hr align="LEFT" size=4>
<p align="center"> <br>
  Schedule 4.4</p>
<p align="center">Undisclosed liabilities</p>
<p>All of Seller's assets are pledged as collateral against the bank line of credit
  with Silicon Valley Bank. Bank approval of the sale of the serial business is
  required to consummate the sale.</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif">27</font></p>
<hr align="LEFT" size=4>
<p>&nbsp;</p>
<P ALIGN="left">&nbsp; </P>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>ex10-2.htm
<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
  10.2</b></font></p>
<p align="center"><font face="Times New Roman, Times, serif" size="4">Supply and
  Licensing Agreement Between<br>
  Quatech, Inc. and<br>
  Socket Mobile, Inc.</font></p>
<p><font face="Times New Roman, Times, serif">This Agreement, effective as of
  September 30, 2009 (&quot;Effective Date&quot;), is made and entered into by
  and between QuaTech, Inc., (&quot;QUATECH&quot;), an Ohio Corporation with its
  principal place of business at 5675 Hudson Industrial Parkway, Hudson, Ohio
  44236 and Socket Mobile, Inc. (&quot;SOCKET&quot;), a Delaware Corporation,
  having its principal place of business at 39700 Eureka Drive, Newark, California
  94560, collectively hereafter referred to as the &quot;Parties&quot;. QUATECH
  is a wholly owned subsidiary of DPAC Technologies Corp., a California Corporation,
  located at 5675 Hudson Industrial Parkway, Hudson, Ohio 44236.</font></p>
<p><font face="Times New Roman, Times, serif">WHEREAS SOCKET is selling to QUATECH
  the designs, engineering specifications and related documentation, software
  drivers and exclusive marketing rights for its serial products under an Asset
  Purchase Agreement dated September 30, 2009 (&quot;Purchase Agreement&quot;);</font></p>
<p><font face="Times New Roman, Times, serif">WHEREAS the sale of the serial products
  to QUATECH includes the right for QUATECH to manufacture or have manufactured
  the serial products. In connection with this right, QUATECH and SOCKET have
  agreed for QUATECH to purchase SOCKET's HIS3 chip from SOCKET under this Agreement;</font></p>
<p><font face="Times New Roman, Times, serif">WHEREAS the serial products being
  sold to QUATECH include SOCKET'S Cordless Serial Adapter (&quot;CSA&quot;),
  QUATECH and SOCKET have agreed the purchase of the CSA only includes the design
  implementation currently being marketed and sold along with SOCKET's serial
  products and SOCKET shall license to QUATECH hereunder SOCKET'S firmware implemented
  within the CSA that provides Bluetooth functionality along with the CSA's Configuration
  Utilities.</font></p>
<p><font face="Times New Roman, Times, serif">NOW THEREFORE in consideration for
  the mutual covenants and obligations set forth herein, the parties hereby agree
  as follows:</font></p>
<p><font face="Times New Roman, Times, serif">1. <u>TERM</u></font></p>
<p><font face="Times New Roman, Times, serif">The term of this Agreement shall
  commence on the Effective Date and shall terminate ten (10) years after such
  date, unless otherwise terminated or canceled by either party as provided herein.
  This Agreement shall automatically renew for additional one (1) year terms unless
  one of the Parties notifies the other in writing that it does not desire to
  renew the Agreement at least sixty (60) days prior to the expiration date.</font></p>
<p align="center"><font face="Times New Roman, Times, serif">1</font></p>
<hr align="LEFT" size=4>
<p><font face="Times New Roman, Times, serif">2. <u>PRODUCTS</u></font></p>
<p><font face="Times New Roman, Times, serif"> <u>HIS3 Chip</u> The HIS3 chip
  is an interface chip owned and manufactured by SOCKET and used in SOCKET products
  including its serial products as more fully described in Appendix A. This Agreement
  enables QUATECH to purchase the HIS3 Chip from Socket for use in all QUATECH
  products (including but not limited to the CSA)(&quot;QUATECH Products&quot;).</font></p>
<p><font face="Times New Roman, Times, serif"><u>Socket Bluetooth BlueLab Application
  Code and Configurator Utilities (&quot;Software&quot;)</u>. The Bluetooth BlueLab
  Application Code is the Bluetooth firmware that runs embedded within the CSA.
  The Configurator Utilities are used on a desktop or notebook computer to configure
  the BlueLab Application Code firmware when the CSA is plugged into a desktop
  or notebook. The Software is described in more detail in Appendix B. This Agreement
  licenses QUATECH to distribute this Software with the CSA purchased under the
  Purchase Agreement.</font></p>
<p><font face="Times New Roman, Times, serif"><u>CSA Product</u>. A limited quantity
  of the Cordless Serial Adapter product is available due to the end of life status
  of the BC02 Bluetooth chip designed into this product. SOCKET has manufactured
  and holds in its inventory approximately 1,700 CSA units. SOCKET agrees to hold
  these units for purchase by QUATECH, and QUATECH agrees to purchase these units
  no later than March 31, 2010 at SOCKET's cost of $35.24 per unit. In addition,
  SOCKET has in its inventory approximately 2,100 BC02 modules at a cost of $15.65
  per unit which have been removed from SOCKET's price lists as an end of life
  product. These modules represent the likely last available supply that could
  be used to build additional CSA products. QUATECH agrees to advise SOCKET no
  later than November 30, 2009 whether QUATECH will commit to a) purchase some
  or all of these modules or b) instruct SOCKET to build additional CSA products
  with these modules that QUATECH will commit to purchase and which SOCKET agrees
  to build if so ordered by QUATECH.. After November 30, 2009 or upon being advised
  by QUATECH that some or all of the BCO2 modules are not needed, SOCKET has the
  right to dispose of any BC02 modules not needed by QUATECH. </font></p>
<p><font face="Times New Roman, Times, serif">3. <u>SOFTWARE AND TEMPORARY LICENSE
  OF SOCKET MOBILE I/P</u></font></p>
<p><font face="Times New Roman, Times, serif"> <u>License and Distribution Rights</u>.
  QUATECH is granted a worldwide perpetual royalty free license to use, display
  and distribute the Software and related technical and user documentation in
  object code format with the CSA product acquired under the Purchase Agreement.
  SOCKET shall supply QUATECH with master copies of the Software (including source
  code of the Configurator Utilities ) along with all technical and user documentation
  that describes the use of the Software. QUATECH is also granted a source code
  license for the Configurator Utilities and the right to create derivative works
  of this product and its documentation and to use, modify, display and distribute
  all such derivative works. QUATECH shall provide SOCKET with a source code copy
  and related documentation of all derivative works to enable SOCKET to provide
  second level support for the CSA.</font></p>
<p><font face="Times New Roman, Times, serif"> <u>Software Support and Warranty</u>.
  The Software is supplied &quot;as is&quot;. Bug fixes that correct conditions
  that keep the Software from operating in accordance with its specifications
  shall be made by Socket upon request at no charge to QUATECH. All other modifications
  if any requested by QUATECH shall be made by SOCKET at SOCKET'S discretion at
  a non-recurring engineering fee to be mutually agreed at the time of such request
  based on fees common to the industry for software development. SOCKET shall
  also provide QUATECH with second level technical support in answering technical
  questions regarding the Software.</font></p>
<p align="center"><font face="Times New Roman, Times, serif">2</font></p>
<hr align="LEFT" size=4>
<p><font face="Times New Roman, Times, serif"><u>Socket Mobile Intellectual Property
  (I/P)</u>. Socket Mobile I/P used by SOCKET on its serial products consists
  of the name 'Socket Mobile' and the logo 'Socket'. These marks have been used
  on labels, data sheets, manuals, product packaging and on driver software. Certain
  products being purchased by QUATECH may initially contain Socket Mobile I/P.
  It is the intent of the parties that QUATECH will update and remove Socket Mobile
  I/P and replace it with Quatech I/P on data sheets, manuals, packaging and driver
  software and will begin to affix a sticker to product labels or create new labels
  no later than December 31, 2009. QUATECH is granted a royalty-free license through
  December 31, 2009 to manufacture and distribute purchased products containing
  Socket Mobile I/P. </font></p>
<p><font face="Times New Roman, Times, serif">4. <u>HIS3 CHIP</u></font></p>
<p><font face="Times New Roman, Times, serif"> <u>Right to incorporate the chip
  into QUATECH Products</u>. QUATECH is granted the right to use the HIS3 chip
  in all QUATECH Products. The HIS3 chip may not be sold as a stand-alone chip
  without the express written permission of SOCKET.</font></p>
<p><font face="Times New Roman, Times, serif"><u>Technical Support</u>. QUATECH
  shall provide first level support to its customers for its serial products containing
  the HIS3 chip. SOCKET shall provide second level support and training services
  to QUATECH for the HIS3 chip Monday through Friday during SOCKET's normal business
  hours. </font></p>
<p><font face="Times New Roman, Times, serif"><u>Escrow of HIS3 Engineering specification
  documentation</u>. SOCKET shall arrange to place and keep current the most recent
  engineering drawings and specifications for its HIS3 chip as defined in the
  Escrow Service Agreement to be mutually agreed between the parties. The escrow
  shall be established under a Master Beneficiary Three-Party Escrow Service Agreement
  between QUATECH, SOCKET and Iron Mountain Intellectual Property Management,
  Inc. , a copy of which is attached hereto as Appendix C (hereafter referred
  to as the &quot;Escrow Agreement&quot;). The Escrow Agreement shall provide
  for the release of the engineering drawings and specifications with a license
  to manufacture and sell the HIS3 chip for use in QUATECH Products in the event
  that SOCKET becomes insolvent or otherwise declares bankruptcy, in the event
  SOCKET breaches this Agreement or in the event SOCKET fails to function as a
  going concern or to operate in the ordinary course, each as more fully described
  in the Escrow Agreement.</font></p>
<p><font face="Times New Roman, Times, serif"><u>Warranty of the HIS3 Chip</u>.
  SOCKET shall warrant the HIS3 chip to perform in accordance with its specifications
  for a period of fifteen months from date of receipt by QUATECH in accordance
  with its normal warranty policy as specified in Appendix D. </font></p>
<p><font face="Times New Roman, Times, serif"><u>Sale to Government</u>. If QUATECH
  sells its QUATECH Products containing the HIS3 chip to the United States Federal
  Government either directly or indirectly, or through the General Services Administration
  (&quot;GSA&quot;), California Multiple Award Schedule (&quot;CMAS&quot;), or
  other government multiple award schedule contracts, SOCKET agrees to provide
  any representations or certifications to QUATECH or any of QUATECH'S U.S. Federal
  Government end-users as may be required, including but not limited to a Letter
  of Supply required to add the QUATECH Products to QUATECH's GSA Schedule. SOCKET
  agrees to furnish the HIS3 chips needed by QUATECH to fulfill any GSA, CMAS,
  or other government multiple award schedule contracts or similar contract obligations
  under any schedule contract, and to accept any government flow-down provisions,
  including but not limited to, the United States Government Federal Acquisition
  Regulations (&quot;FARs&quot;) and its supplements, Defense FARs, or NASA FARs,
  whether for resale or internal use.</font></p>
<p align="center"><font face="Times New Roman, Times, serif">3</font></p>
<hr align="LEFT" size=4>
<p><font face="Times New Roman, Times, serif">5. <u>HIS3 CHIP ORDERS/RESCHEDULE
  RIGHTS</u></font></p>
<p><font face="Times New Roman, Times, serif">QUATECH shall order HIS3 chips by
  issuing and delivering to SOCKET written purchase orders (&quot;Purchase Orders&quot;).
  QUATECH shall order a minimum of 1,000 HIS3 chips per quarter for delivery during
  the six (6) quarters commencing with the quarter ending December 31, 2009. Delivery
  dates specified in the Purchase Orders shall be consistent with minimum lead
  time guidelines supplied by SOCKET from time to time, unless otherwise agreed
  between the parties. SOCKET shall have three (3) business days within which
  to either accept or reject a submitted Purchase Order and shall submit an order
  confirmation to QUATECH . Purchase Orders that are not rejected shall be deemed
  accepted by SOCKET. Subject to the Purchase Order Reschedule Table referred
  to below, Purchase Orders are firm and may not be cancelled after acceptance
  by SOCKET. </font></p>
<p><font face="Times New Roman, Times, serif"> Purchase Order Reschedule Table:<br>
  </font></p>
<ul>
  <li><font face="Times New Roman, Times, serif">Purchase Orders for delivery
    dates due within 30 days shall be firm<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Purchase Orders for delivery
    dates due within 31 days to 60 days may be up to 50% rescheduled <br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Purchase Orders for delivery
    dates due in greater than 60 days may be up to 100% rescheduled</font></li>
</ul>
<p><font face="Times New Roman, Times, serif">No Purchase Orders may be rescheduled
  more than three times and for no more than six months in total from the original
  due date. </font></p>
<p><font face="Times New Roman, Times, serif">6. <u>NON-BINDING FORECASTS FOR
  SUPPLY OF THE HIS3 CHIP</u></font></p>
<p><font face="Times New Roman, Times, serif">QUATECH shall provide SOCKET at
  least quarterly a rolling six month non-binding forecast of its requirements
  for the HIS3 chip to aid SOCKET in planning its manufacturing schedules and
  inventory levels. </font></p>
<p><font face="Times New Roman, Times, serif">7. <u>PRICING</u></font></p>
<p><font face="Times New Roman, Times, serif"> The purchase price for the HIS3
  chip will be $19.75 per chip until a cumulative total of 75,000 chips have been
  purchased by QUATECH under this Agreement. QUATECH may, at its option, place
  an order with SOCKET for delivery of all 75,000 chips less quantities previously
  ordered at a price of $15.75 per chip. Delivery dates for this order must be
  specified within a six month period from the date of order. All HIS3 chips will
  be shipped FOB Socket's plant. The price of the HIS3 chip includes the cost
  of freight. Subsequent to the purchase by QUATECH of the initial 75,000 chips,
  the purchase price will be reduced to $3.75 per chip.</font></p>
<p align="center"><font face="Times New Roman, Times, serif">4</font></p>
<hr align="LEFT" size=4>
<p><font face="Times New Roman, Times, serif">8. <u>SPECIFICATIONS/CHANGES/END
  OF LIFE</u></font></p>
<p><font face="Times New Roman, Times, serif"> SOCKET shall not make any modifications,
  improvements, alterations or changes (hereinafter collectively referred to as
  &quot;Changes&quot;) to the HIS3 chips as listed in the attached Appendix A
  during the term of this Agreement that affect or may tend to affect form, fit,
  function, appearance, reliability, or interchangeability without prior notification
  to QUATECH in writing and only due to changes outside of the control of SOCKET
  such as technical obsolescence of components of the HIS3 chip. In the event
  Changes are required, SOCKET shall give QUATECH a minimum of three months written
  notification of Changes prior to proceeding and shall enable QUATECH to place
  a last buy order for the current HIS3 chip. </font></p>
<p><font face="Times New Roman, Times, serif"> QUATECH may, at its option, request
  that a test be performed on any Changes to ensure the HIS3 chips as changed
  comply with Specifications.</font></p>
<p><font face="Times New Roman, Times, serif">9. <u>PACKAGING</u></font></p>
<p><font face="Times New Roman, Times, serif"> SOCKET shall be responsible to
  provide packaging for the HIS3 chips of the necessary quality, construction
  and strength to prevent damage in transit. SOCKET shall bear all costs related
  to packaging, and to the cartoning and packing, including drayage and palleting,
  if applicable.</font></p>
<p><font face="Times New Roman, Times, serif">10. <u>TRADEMARKS, LOGOS, LABELING</u></font></p>
<p><font face="Times New Roman, Times, serif">During the term of this Agreement,
  QUATECH is hereby granted a non-exclusive license to use at its option the trademarks,
  service marks, trade names, product names, logos, designs, and other designations
  or brands (the &quot;Marks&quot;) owned by SOCKET relating to the HIS3 chip
  in connection with identifying that the QUATECH Products contain an HIS3 chip
  from SOCKET. QUATECH shall not remove or deface any Marks appearing on the HIS3
  chips or on any documentation provided by SOCKET hereunder. QUATECH may indicate
  its relationship to SOCKET and refer to the HIS3 chip and any marks relating
  thereto provided that such references are truthful and not misleading and SOCKET
  is designated the owner of the Marks.</font></p>
<p><font face="Times New Roman, Times, serif">QUATECH is not granted any right,
  title or interest in the SOCKET Marks except as provided for herein and in the
  Purchase Agreement, and acknowledges SOCKET's right in and to the Marks and
  agrees that any and all use of the Marks by QUATECH shall inure to the sole
  benefit of SOCKET. QUATECH agrees that it shall not take any action inconsistent
  with the ownership of the Marks and agrees not to challenge SOCKET's rights
  in or attempt to register any of the Marks or any mark confusingly similar thereto.</font></p>
<p><font face="Times New Roman, Times, serif">Nothing in this Agreement grants
  SOCKET any right to use, or right, title or interest in any Marks owned by QUATECH
  or its affiliates and subsidiaries.</font></p>
<p><font face="Times New Roman, Times, serif">11. <u>PAYMENTS</u><br>
  <br>
  All prices are in U.S. currency. SOCKET shall bill QUATECH at the time that
  HIS3 chips are shipped. Payments are due forty-five (45) days after QUATECH's
  receipt of invoice. In the case of deliveries made in installments, each shipment
  shall be paid for when delivered and invoiced without regard to the other scheduled
  deliveries. SOCKET shall not be required to ship additional HIS3 chip to QUATECH
  while undisputed payments are delinquent (all disputes by QUATECH must be in
  good faith). </font></p>
<p></p>
<p align="center"><font face="Times New Roman, Times, serif">5</font></p>
<hr align="LEFT" size=4>
<p><font face="Times New Roman, Times, serif"> 12.<u> REPRESENTATIONS AND WARRANTIES</u></font></p>
<p><font face="Times New Roman, Times, serif"> SOCKET makes the following representations
  and warranties to QUATECH, each of which is true and correct on the date hereof
  and shall continue to be true and correct at all times during the term of this
  Agreement, and hereby covenants as follows:<br>
  </font></p>
<blockquote>
  <p><font face="Times New Roman, Times, serif">(i) SOCKET has all requisite corporate
    power and authority to execute, deliver and perform this Agreement and any
    other agreements contemplated hereby and to consummate the transactions contemplated
    hereby.<br>
    </font></p>
  <p><font face="Times New Roman, Times, serif">(ii) The HIS3 chips are new and
    shall be free and clear of all liens and encumbrances.<br>
    </font></p>
  <p><font face="Times New Roman, Times, serif">(iii) The HIS3 chips will be covered
    by the fifteen month warranty set out in Appendix D. <br>
    </font></p>
  <p><font face="Times New Roman, Times, serif">(iv) The HIS3 chip are suitable
    for manufacture and incorporation into the QUATECH Products as contemplated
    by this Agreement, and fully comply with all applicable codes, standards,
    specifications, laws and regulations and have all required approvals, certifications
    and licensing (collectively &quot;Certifications&quot;) in each region/country
    where the HIS3 chips have been obtained and will be sold. As appropriate,
    SOCKET shall provide evidence to such effect including all Certifications
    as required by QUATECH.<br>
    </font></p>
  <p><font face="Times New Roman, Times, serif">(v) All HIS3 chips meet the latest
    requirements of the European environmental directives 2002/95/EC on the restriction
    of the use of certain hazardous substances in electric and electronic equipment
    (RoHS) and 2002/96/EC on waste electrical and electronic equipment (WEEE).
    Upon request SOCKET shall certify its compliance by signing a 'Supplier Declaration
    of Conformity'. <br>
    </font></p>
  <p><font face="Times New Roman, Times, serif">(vi) The HIS3 chips and their
    use do not infringe upon any copyright, patent, trademark, trade secret or
    other proprietary or intellectual property right of any third party and as
    of the Effective Date of this Agreement, SOCKET has no knowledge of any suits
    or proceedings, pending or threatened, alleging any such infringement.<br>
    </font></p>
  <p><font face="Times New Roman, Times, serif">(vii) All documents and statements
    provided by SOCKET under this Agreement, including, but not limited to, the
    Country of Origin of the HIS3 chips, Export Control Classification Numbers
    (&quot;ECCN&quot;), Supplier Declaration of Conformity and Certificate of
    Insurance are true and correct and may be relied upon by QUATECH.</font></p>
</blockquote>
<p><font face="Times New Roman, Times, serif">SOCKET warrants the HIS3 chips against
  defects in material and workmanship, and warrants that they will function substantially
  in conformance with their published specification, under normal use and service
  for the time periods and in accordance with the terms and conditions specified
  in Appendix B. <br>
  </font></p>
<p><font face="Times New Roman, Times, serif">EXCEPT FOR (I) ANY BREACH OF SECTION
  18 OR (II) SOCKET'S INDEMNIFICATION OBLIGATIONS IN SECTION 14, SOCKET IS NOT
  RESPONSIBLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES RESULTING FROM BREACH OF
  ANY EXPRESS OR IMPLIED WARRANTY, INCLUDING DAMAGE TO PROPERTY AND, TO THE EXTENT
  PERMITTED BY LAW, DAMAGES FOR PERSONAL INJURY. THIS WARRANTY IS IN LIEU OF ALL
  OTHER WARRANTIES INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS
  FOR A PARTICULAR PURPOSE. <br>
  </font></p>
<p><font face="Times New Roman, Times, serif">Some states do not allow limitation
  of implied warranties, or the exclusion or limitation of incidental or consequential
  damages, so that the above limitations or exclusions may not apply to QUATECH
  . This warranty gives QUATECH specific legal rights and QUATECH may also have
  other rights which vary from state to state. <br>
  </font></p>
<p align="center"><font face="Times New Roman, Times, serif">6</font></p>
<hr align="LEFT" size=4>
<p><font face="Times New Roman, Times, serif">13. <u>QUALITY CONTROL</u></font></p>
<p><font face="Times New Roman, Times, serif"> SOCKET's Responsibilities for specification
  conformance:</font></p>
<p><font face="Times New Roman, Times, serif">SOCKET maintains a quality control
  system which is designed to assure that all materials and services conform to
  the specifications as described in the data sheets. SOCKET performs all inspections
  and tests required to substantiate material conformance to specifications. </font></p>
<p><font face="Times New Roman, Times, serif"> SOCKET Corrective Action:</font></p>
<p><font face="Times New Roman, Times, serif"> SOCKET shall take prompt action
  to isolate and correct conditions which result in material non-conformance to
  specifications. </font></p>
<p><font face="Times New Roman, Times, serif">14. <u>INTELLECTUAL PROPERTY/PATENT
  INDEMNIFICATION</u></font></p>
<p><font face="Times New Roman, Times, serif"> <u>Indemnification by SOCKET</u>:
  SOCKET will defend, indemnify and hold QUATECH, its parent, affiliates and subsidiaries
  and their officers, directors and employees harmless from and against any and
  all claims, damages, costs, expenses (including but not limited to, reasonable
  attorneys' fees and costs) or liabilities which may result, in whole or in part,
  from any warranty or product liability claim or any property damage or personal
  injury (including death) brought against QUATECH to the extent the claims result
  solely from the HIS3 chips or Software supplied by SOCKET to QUATECH hereunder,
  or any claim that the sale or use or distribution of the HIS3 chips or Software
  infringes any patent, copyright, trademark, trade secret, or other proprietary
  or intellectual property right of any third party (hereinafter, &quot; Claim&quot;)
  brought against QUATECH and SOCKET will pay all claims, damages, costs, expenses
  (including but not limited to reasonable attorneys' fees and costs) or liabilities
  which result from any of the above, provided that SOCKET is promptly informed
  in writing and furnished a copy of each communication, notice, or other action
  relating to the above and is given the authority, information, and assistance
  necessary to defend or settle such Claim, provided that SOCKET may not settle
  any Claim without QUATECH's prior written consent, such consent not to be unreasonably
  withheld. QUATECH shall have the right, at its expense, but not the obligation
  to participate in any such Claim.</font></p>
<p><font face="Times New Roman, Times, serif"> The above indemnification shall
  not apply to the extent awards, judgments, decrees and settlements result from
  modification, misuse, abuse, or misrepair of HIS3 chips or Software by or on
  behalf of or authorized by QUATECH or QUATECH's customer or the user of the
  HIS3 chips or Software or by defects in the design, manufacture, or operation
  of HIS3 chips or Software when such defects are attributable solely to use in
  conjunction with QUATECH products. </font></p>
<p><font face="Times New Roman, Times, serif"> Should the HIS3 chips or Software
  delivered by SOCKET hereunder be adjudged infringing, or in SOCKET's opinion
  be likely to be adjudged infringing any Patent (defined below), then SOCKET
  shall, at its expense and option either (i) procure for QUATECH the right to
  use such HIS3 chips or Software free of any liability or infringement, or (ii)
  replace such HIS3 chips or Software with non-infringing substitutes or modify
  such HIS3 chips or Software to be non-infringing. If neither alternative (i)
  or (ii) can be accomplished, then SOCKET shall refund QUATECH's full purchase
  price and accept return of such HIS3 chips or Software.</font></p>
<p align="center"><font face="Times New Roman, Times, serif">7</font></p>
<hr align="LEFT" size=4>
<p><font face="Times New Roman, Times, serif"> <u>Indemnification by QUATECH</u>:
  QUATECH will defend, indemnify and hold SOCKET harmless from any patent, copyright,
  trademark, or other intellectual property right (hereinafter, &quot;Patent&quot;)
  action brought against SOCKET to the extent that it is based solely on a claim
  that QUATECH Products manufactured or developed and supplied by QUATECH to its
  customers (excluding SOCKET products, HIS3 chips or Software) hereunder constitute
  an infringement of any Patent right and QUATECH will pay all damages and costs
  awarded against SOCKET in such action which are attributable to such claim,
  provided that QUATECH is promptly informed in writing and furnished a copy of
  each communication, notice, or other action relating to the alleged infringement
  and is given the authority, information, and assistance necessary to defend
  or settle such claim. SOCKET shall have the right, at its expense, to participate
  in any such claim or action.<br>
  <br>
  15. <u>LIMITATION OF LIABILITY</u></font></p>
<p><font face="Times New Roman, Times, serif"> EXCEPT FOR (I) ANY BREACH OF SECTION
  12, (II) EITHER PARTY'S INDEMNIFICATION OBLIGATIONS IN SECTION 14 OR (III) ANY
  BREACH OF SECTION 18, EITHER PARTY'S ENTIRE LIABILITY ARISING OUT OF THIS AGREEMENT
  AND/OR SALE, DISTRIBUTION, USE OR PERFORMANCE OF ANY PRODUCT OR ANY BREACH THEREOF
  SHALL BE LIMITED TO THE GREATER OF (1) THE TOTAL AMOUNT PAID BY QUATECH FOR
  PURCHASES OF HIS3 CHIPS DURING THE TWENTY FOUR (24) MONTH PERIOD PRECEDING THE
  DATE THE INITIAL CLAIM IS MADE AGAINST A PARTY UNDER OR WITH RESPECT TO THIS
  AGREEMENT, OR (2) THE TOTAL VALUE OF THE HIS3 CHIPS THAT ARE THE SUBJECT OF
  THE CLAIM.</font></p>
<p><font face="Times New Roman, Times, serif">EXCEPT FOR (I) ANY BREACH OF SECTION
  18 OR (II) EITHER PARTY'S INDEMNIFICATION OBLIGATIONS IN SECTION 14, IN NO EVENT
  SHALL EITHER PARTY BE LIABLE FOR LOSS OF USE, DATA OR PROFITS, OR ANY SPECIAL,
  INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, ARISING OUT OF OR IN CONNECTION
  WITH THIS AGREEMENT OR THE USE, SALE, LICENSE, DISTRIBUTION OR PERFORMANCE OF
  PRODUCTS OR ANY BREACH THEREOF, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY,
  WHETHER IN AN ACTION FOR CONTRACT OR TORT (INCLUDING NEGLIGENCE) OR OTHERWISE,
  AND WHETHER OR NOT EITHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
  DAMAGES. </font></p>
<p><font face="Times New Roman, Times, serif">16. <u>COMPLIANCE WITH LAWS</u></font></p>
<p><font face="Times New Roman, Times, serif"> Both Parties shall in the performance
  of this Agreement comply with all applicable laws, executive orders, regulations,
  ordinances, proclamations, demands and requisitions of national governments,
  or of any state or local governmental authority which may now or hereafter govern
  performance hereunder including laws dealing with the certification and qualification
  of products and with the export of products. </font></p>
<p align="center"><font face="Times New Roman, Times, serif">8</font></p>
<hr align="LEFT" size=4>
<p></p>
<p><font face="Times New Roman, Times, serif">17. <u>GOVERNING LAW</u></font></p>
<p><font face="Times New Roman, Times, serif"> This Agreement and any questions
  concerning its validity, construction, or performance shall be governed by the
  laws of the State of Ohio, United States of America. </font></p>
<p><font face="Times New Roman, Times, serif">18. <u>NON-DISCLOSURE AGREEMENT</u></font></p>
<p><font face="Times New Roman, Times, serif"> Except as required by law, neither
  party will disclose the terms and conditions of this Agreement to any third
  party without the prior written consent of the other party. The Mutual Non-Disclosure
  Agreement between SOCKET and DPAC Technologies on behalf of Quatech dated July
  10, 2008 applies to and is incorporated into this Agreement.</font></p>
<p><font face="Times New Roman, Times, serif">19. <u>FORCE MAJEURE</u></font></p>
<p><font face="Times New Roman, Times, serif"> Neither party shall be responsible
  for any failures or delays under this Agreement due to causes beyond its reasonable
  control and without its fault or negligence, including, without limitation,
  civil insurrection, riot, labor or transportation strikes, fire, storm, flood,
  earthquake, volcanic eruption, explosion, war, embargoes, acts of God, acts
  of government or any agency thereof, or judicial action. Upon the giving of
  prompt notice of any such cause to the other party, the time of performance
  by the party so affected shall be extended to the extent and for the period
  that its performance of said obligations is prevented by such causes provided,
  however, that if such causes delay performance by more than ninety (90) days,
  either party shall have the right to terminate this Agreement without further
  obligation hereunder.</font></p>
<p><font face="Times New Roman, Times, serif">20. <u>TAXES AND DUTIES</u></font></p>
<p><font face="Times New Roman, Times, serif"> Neither party shall be responsible
  for taxes and duties of the other party. QUATECH shall provide to SOCKET a valid
  exemption certificate or other document acceptable to taxing or custom authorities.</font></p>
<p><font face="Times New Roman, Times, serif">21. <u>ASSIGNMENT</u></font></p>
<p><font face="Times New Roman, Times, serif"> Neither party shall assign this
  Agreement nor any obligations or rights hereunder without the prior written
  consent of the other party. Written consent will not unreasonably be withheld,
  delayed or conditioned.</font></p>
<p><font face="Times New Roman, Times, serif">22. <u>RELATIONSHIP</u></font></p>
<p><font face="Times New Roman, Times, serif">It is expressly agreed that SOCKET
  and QUATECH are acting hereunder as independent contractors and under no circumstances
  shall any of employees of one party be deemed the employees of the other for
  any purpose. This Agreement shall not be construed as authority for either party
  to act for the other party in any agency or other capacity, or to make commitments
  of any kind for the account of or on behalf of the other.</font></p>
<p align="center"><font face="Times New Roman, Times, serif">9</font></p>
<hr align="LEFT" size=4>
<p><font face="Times New Roman, Times, serif">23. <u>NOTICES</u></font></p>
<p><font face="Times New Roman, Times, serif"> Any notice required or permitted
  to be given hereunder shall be in writing and shall be sent by registered or
  certified mail, return receipt requested, or else hand-delivered, addressed
  as follows:</font></p>
<table width="57%" border="0" cellspacing="0" cellpadding="0">
  <tr>
    <td width="22%" valign="top"><font face="Times New Roman, Times, serif">To
      QUATECH: </font></td>
    <td width="78%"><font face="Times New Roman, Times, serif">QUATECH Inc.<br>
      Attention: Steve Runkel, President and CEO <br>
      5875 Hudson Industrial Parkway<br>
      Hudson, Ohio 44236</font></td>
  </tr>
  <tr>
    <td width="22%" valign="top">&nbsp;&nbsp;</td>
    <td width="78%">&nbsp;&nbsp;</td>
  </tr>
  <tr>
    <td width="22%" valign="top"><font face="Times New Roman, Times, serif">To
      SOCKET: </font></td>
    <td width="78%"><font face="Times New Roman, Times, serif">SOCKET Mobile,
      Inc.<br>
      Attention: Micheal Gifford, Executive VP<br>
      39700 Eureka Drive<br>
      Newark, CA 94560</font></td>
  </tr>
</table>
<p><font face="Times New Roman, Times, serif">24. <u>SEVERABILITY OF PROVISIONS</u></font></p>
<p><font face="Times New Roman, Times, serif"> In the event that any provision
  of this Agreement shall be held to be invalid or unenforceable, the same shall
  not affect in any respect whatsoever the validity or enforceability of the remainder
  of this Agreement.</font></p>
<p><font face="Times New Roman, Times, serif">25. <u>WAIVER</u></font></p>
<p><font face="Times New Roman, Times, serif"> The failure of either party to
  enforce, in any one or more instances, any of the terms or conditions of this
  Agreement shall not be construed as a waiver of the future performance of any
  such term or condition.<br>
  <br>
  26. <u>TERMINATION</u></font></p>
<p><font face="Times New Roman, Times, serif"> Either party may terminate this
  Agreement at any time for the other party's uncured default provided that the
  terminating party has given to the other party thirty (30) days prior written
  notice of such default and its intention to terminate. After giving such notice,
  a party may suspend its own performance under this Agreement until such default
  is cured. Termination shall not constitute a party's sole remedy for default.
  Default shall include, but is not limited to:</font></p>
<p><font face="Times New Roman, Times, serif">a) Failure of QUATECH to pay undisputed
  invoices (all disputes must be in good faith) when due and this is not rectified
  within thirty (30) days of notice from SOCKET;<br>
  <br>
  b) Insolvency - Either party may terminate this Agreement effective immediately
  and without liability upon written notice to the other party if the other party
  (i) becomes insolvent, (ii) declares bankruptcy, (iii) becomes the subject of
  any proceedings seeking relief, reorganization, or rearrangement under any laws
  relating to insolvency, (iv) makes an assignment for the benefit of creditors,
  or (v) commences the liquidation, dissolution, or winding up of its business.</font></p>
<p align="center"><font face="Times New Roman, Times, serif">10</font></p>
<hr align="LEFT" size=4>
<p></p>
<p><font face="Times New Roman, Times, serif"> 27. <u>ENTIRE AGREEMENT</u></font></p>
<p><font face="Times New Roman, Times, serif"> This contract contains the entire
  agreement between the Parties, and no modifications or waiver of any of the
  provisions, or any future representation, promise, or addition shall be binding
  upon the parties unless agreed to in writing. All purchase orders/order acknowledgements
  shall be subject only to the terms and conditions of this Agreement. If any
  of the provisions of SOCKET's acknowledgments or other writings are in addition
  to or in conflict with the terms and conditions of this Agreement or are ambiguous,
  those additional, conflicting or ambiguous terms and conditions are expressly
  rejected and the terms and conditions of this Agreement shall govern.</font></p>
<table width="57%" border="0" cellspacing="0" cellpadding="0" align="center">
  <tr>
    <td width="46%" valign="top">
      <div align="center"><font face="Times New Roman, Times, serif">SOCKET MOBILE,
        INC.</font></div>
    </td>
    <td width="4%" align="center">&nbsp;</td>
    <td width="50%" align="center">
      <div align="center"><font face="Times New Roman, Times, serif">QUATECH Inc.<br>
        </font></div>
    </td>
  </tr>
  <tr>
    <td width="46%" valign="top">&nbsp;&nbsp;</td>
    <td width="4%">&nbsp;</td>
    <td width="50%">&nbsp;&nbsp;</td>
  </tr>
  <tr>
    <td width="46%" valign="top">
      <p><font face="Times New Roman, Times, serif">By: /s/ Kevin J. Mills</font><br>
        <font face="Times New Roman, Times, serif">Name: Kevin J. Mills</font><br>
        <font face="Times New Roman, Times, serif">Title: President and CEO<br>
        Date: September 30, 2009 </font> </p>
    </td>
    <td width="4%">&nbsp;</td>
    <td width="50%"><font face="Times New Roman, Times, serif">By: /s/ Steven
      D. Runkel<br>
      Name: Steven D. Runkel<br>
      Title: CEO, President<br>
      Date: September 30, 2009</font></td>
  </tr>
</table>
<p>&nbsp;</p><p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif">11</font></p>
<hr align="LEFT" size=4>
<p align="center"><b> A<font face="Times New Roman, Times, serif">PPENDIX A<br>
  SOFTWARE SPECIFICATIONS</font></b></p>
<p><font face="Times New Roman, Times, serif">The following software programs
  constitute the Software for the CSA:</font></p>
<p><font face="Times New Roman, Times, serif"><u>Socket Bluetooth BlueLab Application
  Code (Binary code only)</u></font></p>
<p><font face="Times New Roman, Times, serif">Virtual Machine Code implemented
  as firmware within the CSA</font></p>
<p><font face="Times New Roman, Times, serif"><br>
  <u>Configurator Utilities (Binary Code and Source Code)</u></font></p>
<p><font face="Times New Roman, Times, serif">Windows XP - Socket Cordless Serial
  Adapter Configuration Utility</font></p>
<p><font face="Times New Roman, Times, serif">ScktSdApp.exe - configuration program</font></p>
<p><font face="Times New Roman, Times, serif">Inpout32.dll - utility DLL </font></p>
<p align="center"><font face="Times New Roman, Times, serif"><br>
  </font></p>
<hr align="LEFT" size=4>
<p align="center"><font face="Times New Roman, Times, serif"><br>
  <b>APPENDIX B<br>
  HIS3 CHIP DATA SHEET </b></font></p>
<p><font face="Times New Roman, Times, serif"><b>FEATURES</b><br>
  </font></p>
<ul>
  <li><font face="Times New Roman, Times, serif">Supports PC Card and CompactFlash&reg;
    (CF) bus interfaces<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">512-byte FIFOs in enhanced mode<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Fully software compatible with
    industry standard 16C550 UARTs, supports Additional advanced features found
    in the 16C950<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Maximum baud rate 6.0 Mbps<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Readable FIFO levels<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Flexible clock prescaler can
    divide by any number between 1 and 31. Allows the use of 7.3728 MHz, 14.7456
    MHz or 18.432 MHz crystals to achieve standard baud rates<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Detection of bad data in the
    receiver FIFO<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Readable out-of-band flow control
    status<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Automated out-of-band flow control
    using CTS#/RTS# and DSR#/DTR#<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Transmitter idle interrupt (shift
    register and FIFO empty)<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Software reset<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Arbitrary trigger levels for
    receiver and transmitter FIFO interrupts<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Sleep mode (low operating current)<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> System clock 3 to 24 MHz<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">3.3 V or 5 V operation<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> 80-pin TQFP package (10x10x1
    mm) recommended for new designs<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Operating temperature range
    of -20 to +100&deg; Celsius<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Broad host/client compatibility<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Device drivers available for
    Windows CE/9x/Me/2000/XP/Vista<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Production test sofware available<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Module Mode feature allows the
    mDP to function as 2 independent UARTs<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">8 General Purpose I/O pins<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> Virtual parallel UART<br>
    </font></li>
</ul>
<p><font face="Times New Roman, Times, serif"><b>(Appendix B continued on next
  page)</b></font></p>
<hr align="LEFT" size=4>
<p align="center"></p>
<p align="center"></p>
<p align="center"></p>
<p align="center"></p>
<p align="center"></p>
<p align="center"><b><font face="Times New Roman, Times, serif">APPENDIX B (Continued)<br>
  HIS3 CHIP DATA SHEET</font></b></p>
<p><font face="Times New Roman, Times, serif"><b>Dual Serial Ports Interfaced
  to CF/PC Card Bus</b></font></p>
<p><font face="Times New Roman, Times, serif">The mobilityIC Dual Port or HIS3
  is a single chip implementation of two serial ports interfaced to the PC Card
  or CF buses. A complete PC Card or CF dual serial port peripheral can be built
  with a mobilityIC dual port, a crystal, an EEPROM and two serial transceiver
  chips. Such a design<br>
  offers PC Card/CF compliance, high performance, low power consumption and minimum
  component count. The HIS3 is designed to provide all the functions necessary
  for a universal receiver transmitter subsystem interface, such as for WAN cards
  (GPRS, CDMA, EDGE, UMTS) and GPS. The HIS3 uses a 16C550 compliant core with
  an expanded 512-byte deep receiver<br>
  first-in-first-out (FIFO) memory and 512-byte deep transmitter FIFO memory.
  The deep FIFOs reduce the CPU overhead and allow higher data rates. The HIS3
  contains two high performance UARTs offering data rates up to 6.0 Mbps each.
  The HIS3 connects directly to a serial EEPROM to store nonvolatile information
  which consists of the PC Card/CF tuples and initial configuration information.
  Attribute memory consists of a 248-byte Card Information Structure (CIS), a
  16-<br>
  byte initialization area, and 15 Configuration Registers.</font></p>
<p><font face="Times New Roman, Times, serif">The HIS3 keeps power consumption
  to a minimum by providing features such as fully programmable clock division
  and sleep modes when a function is not being used. The HIS3 can operate at either
  3.3 or 5 volts and does not require external regulation to operate in low or
  high voltage environments. Technology examples include standard or high speed
  serial ports, bar code<br>
  scanners, high-speed radios (GPRS, CDMA, EDGE, UMTS), RFID readers, blood analyzers,
  etc.</font></p>
<p><font face="Times New Roman, Times, serif">The HIS3 design is extremely flexible
  and can be incorporated into:<br>
  </font></p>
<ul>
  <li><font face="Times New Roman, Times, serif">Standard serial ports<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Bar code scanners<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif"> High-speed radios<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">RFID readers<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Blood analyzers<br>
    </font></li>
  <li><font face="Times New Roman, Times, serif">Other industrial applications</font></li>
</ul>
<p></p>
<p align="center"><font face="Times New Roman, Times, serif"><br>
  </font></p>
<hr align="LEFT" size=4>
<p align="center"><font face="Times New Roman, Times, serif"><b><br>
  APPENDIX C<br>
  FORM OF ESCROW AGREEMENT<br>
  (To be attached) </b></font></p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<hr align="LEFT" size=4>
<p align="center">&nbsp;</p>
<p align="center"><font face="Times New Roman, Times, serif"><b>APPENDIX D<br>
  Limited Hardware Warranty</b></font></p>
<p><font face="Times New Roman, Times, serif">Socket Mobile, Inc. warrants the
  HIS3 chip against defects in material and workmanship, under normal use and
  service, for 15 months from the date of purchase. The warranty does not extend
  to damage caused by a manufacturing process of soldering chips to an electronic
  board.</font></p>
<p><font face="Times New Roman, Times, serif">Incompatibility is not a defect
  covered by Socket's warranty. During the warranty period, Socket will, at its
  option, repair or replace defective chips at no charge.</font></p>
<p><font face="Times New Roman, Times, serif"><br>
  Socket will replace or repair the product with new parts and the returned product
  becomes Socket's property. Socket warrants the repaired or replaced products
  to be free from defects in material or workmanship for ninety (90) days after
  the return shipping date, or for the duration of the original warranty period,
  whichever is greater.</font></p>
<p><font face="Times New Roman, Times, serif">This warranty does not cover the
  replacement of products damaged by abuse, accident, misuse or misapplication,
  nor as a result of service or modification other than by Socket.</font></p>
<p><font face="Times New Roman, Times, serif">SOCKET IS NOT RESPONSIBLE FOR INCIDENTAL
  OR CONSEQUENTIAL DAMAGES RESULTING FROM BREACH OF ANY EXPRESS OR IMPLIED WARRANTY,
  INCLUDING DAMAGE TO PROPERTY AND, TO THE EXTENT PERMITTED BY LAW, DAMAGES FOR
  PERSONAL INJURY. THIS WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES INCLUDING
  IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.</font></p>
<p><font face="Times New Roman, Times, serif">Some states do not allow limitation
  of implied warranties, or the exclusion or limitation of incidental or consequential
  damages, so the above limitations or exclusions may not apply to you. This warranty
  gives you specific legal rights, and you may also have other rights that vary
  from state to state. This product may contain fully tested, recycled parts,
  warranted as if new. For warranty information, call +1 (510) 744-2700.</font></p>
<p><font face="Times New Roman, Times, serif">PRODUCT DISPOSAL: The HIS3 chips
  should not be placed in municipal waste. Please check local regulations for
  disposal of electronic products.</font></p>
<p></p>
<p></p>
<p></p>
<p></p>
<p></p>
<hr align="LEFT" size=4>
<p></p>
</body>
</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1 CHARTER
<SEQUENCE>4
<FILENAME>ex99-1pressrelease.htm
<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
  99.1</b></font></p>
<p>&nbsp;</p>
<p><font face="Times New Roman, Times, serif" size="3"><b></b></font></p>
<table cellspacing=0 cellpadding=0 width="100%" align=left border=0>
  <tr valign=bottom>
    <td width=647 height=25 valign="top"><font face="Times New Roman, Times, serif"
      size=3><b><font size="5">SOCKET MOBILE, INC.</font></b></font></td>
    <td width=166 height=20 valign="top">&nbsp;</td>
    <td width=421 height=20 valign="top"><font face="Times New Roman, Times, serif"
      size=3><b><font size="5">QUATECH </font><font size="5"><font size="3"><br>
      <font size="2">A DPAC TECHNOLOGIES COMPANY</font></font></font></b></font></td>
  </tr>
</table>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p><font face="Times New Roman, Times, serif" size="3"><b><font size="5"> <font size="4">NEWS
  RELEASE</font></font></b><br>
  </font></p>
<hr>
<p align="left"><font face="Times New Roman, Times, serif" size="3"><b>For Immediate
  Release</b></font></p>
<p align="left">&nbsp;</p>
<p align="left"><font face="Times New Roman, Times, serif" size="3"><b><font size="4">QUATECH
  ENHANCES PRODUCT LINE WITH SOCKETSERIAL&#153; PURCHASE </font><font size="5"><br>
  </font></b><i><b>Quatech purchases a leading product line of mobile serial connectivity
  devices</b></i><br>
  <br>
  </font></p>
<p align="left"><font face="Times New Roman, Times, serif" size="3"> </font><font face="Times New Roman, Times, serif" size="3"><b>
  HUDSON, OHIO, - October 1, 2009</b> - Quatech, Inc., a division of DPAC Technologies
  (OTCBB: DPAC.OB), and a leader in wireless machine-to-machine (M2M) networking
  and device connectivity solutions, and Socket Mobile Inc.,(Nasdaq, SCKT) an
  innovative provider of mobile productivity products, today announced the Quatech
  purchase of SocketSerial, a business unit of Socket Mobile Inc. selling SocketSerial
  branded connectivity devices for laptops and handheld computers. Quatech intends
  to continue to offer the SocketSerial product line worldwide through general
  two-tier distribution channels under the SocketSerial brand.</font></p>
<p>Founded in 1983, Quatech is the leading supplier in high performance connectivity
  solutions for mobile computing, industrial laptops and handheld computers with
  a broad range of interface adapters. Quatech released the PCMCIA product line
  in 1994 and today offers more choices in serial I/O PC cards than any other
  manufacturer. As laptop and handheld technology evolves, Quatech continues to
  offer the next generation interfaces in mobile connectivity by connecting high-bandwidth
  peripherals through PCMCIA and ExpressCards slots and USB to Serial Adapters.
  Offering options including multiport RS-232/422/485 serial and parallel configurations,
  Quatech laptop and handheld products are widely used in medical, transportation,
  industrial and telecommunication applications.</p>
<p>SocketSerial, an innovator in serial device technology for mobile platforms,
  has manufactured serial communications peripherals for notebooks, PDAs and tablets
  since 1993. Since then, Socket Mobile, through its SocketSerial business unit,
  has continued to be one of the top two leading suppliers, alongside Quatech,
  in serial peripheral technology. This acquisition by Quatech combines the technical
  and support strengths of two of the leading and longtime providers of connectivity
  solutions into a single organization.</p>
<p> &quot;We are very excited about merging the top two leading lines of serial
  peripheral technology for mobile users.&quot; Quatech President and CEO Steve
  Runkel said. &quot;With the addition of the SocketSerial branded product line,
  Quatech continues to seamlessly integrate a wide range of devices and peripherals,
  providing reliable solutions for today's mobile computer systems.&quot;</p>
<p>Quatech, a company dedicated for 26 years to the highest level of performance
  through quality design and manufacturing, and world-class service and support,
  is committed to delivering SocketSerial customers with the same excellent service.
  "Our goal is to make the integration of SocketSerial to Quatech ownership a
  positive transition for the customers." Runkel said. Under Quatech ownership,
  customers will have several avenues of customer support including a live chat
  and advanced support and download pages for customer support documentation needs.</p>
<p>For more information on any of Quatech's products, please visit www.Quatech.com,
  and for information on SocketSerial please visit www.SocketSerial.com.</p>
<p>&nbsp;</p>
<hr>
<p><br>
  <br>
</p>
<p align="center">#####</p>
<p><b>About Quatech, Inc.</b></p>
<p>Quatech delivers high performance device networking and connectivity solutions
  to help companies improve their bottom line results. Its products enable reliable
  machine-to-machine (M2M) communications via secure 802.11 wireless or traditional
  wired networks, with industrial-grade embedded radios, modules, boards and external
  device servers, and bridges. For local and mobile connections, Quatech's serial
  adapters provide secure connectivity and port expansion via any interface option.
</p>
<p>Satisfied customers worldwide rely on Quatech's unique combination of performance
  and support to improve operations through real-time remote monitoring and control,
  streamlined systems, and lowest total cost of ownership (TCO). Quatech markets
  its products through a global network of distributors, resellers, systems integrators
  and original equipment manufacturers in the transportation, instrumentation
  and industrial control, homeland security, medical equipment, and logistics
  markets. Founded in 1983, Quatech is headquartered in Hudson, Ohio. Quatech
  merged with DPAC Technologies (OTCBB: DPAC) in February 2006. Information concerning
  DPAC is filed by DPAC with the SEC and is available on the SEC website, www.sec.gov.
  To learn more about Quatech's complete line of device networking and connectivity
  solutions, visit www.quatech.com.</p>
<p>&nbsp;</p>
<p><b>About Socket Mobile<br>
  </b><br>
  With more than 15 years of experience in the Automatic Identification and Data
  Capture market, Socket makes mobile computing and productivity work. The company
  offers a family of handheld computers and an extensive portfolio of AIDC peripherals
  designed specifically for business mobility deployments and to enable productivity
  increases and drive operational efficiencies in healthcare, hospitality and
  other vertical markets. The company also offers OEM solutions. Socket is headquartered
  in Newark, Calif. and can be reached at 510-933-3000 or www.socketmobile.com.<br>
  <br>
</p>
<p align="center"><font face="Times New Roman, Times, serif" size="3">#####</font></p>
<p align="left">&nbsp;</p>
<table cellspacing=0 cellpadding=0 width="100%" align=left border=0>
  <tr valign=bottom>
    <td width=488 height=25><font face="Times New Roman, Times, serif"
      size=3><b><u>Media Contacts:</u></b></font></td>
    <td width=488 height=20>&nbsp;</td>
    <td width=488 height=20><font face="Times New Roman, Times, serif"
      size=3><b></b></font></td>
  </tr>
  <tr valign=bottom>
    <td width=488 height=25>Jennifer McKeever</td>
    <td width=564 height=20>&nbsp;</td>
    <td width=564 height=20>David Dunlap, CFO</td>
  </tr>
  <tr valign=bottom>
    <td width=488 height=20>Quatech, Inc.</td>
    <td width=564 height=20>&nbsp;</td>
    <td width=564 height=20>Socket Mobile, Inc.</td>
  </tr>
  <tr valign=bottom>
    <td width=488 height=20>PH: (330) 655-9000</td>
    <td width=564 height=20>&nbsp;</td>
    <td width=564 height=20>PH: (510) 933-3035</td>
  </tr>
  <tr valign=bottom>
    <td width=488 height=20>Email: jennifer.mckeever@quatech.com</td>
    <td width=564 height=20>&nbsp;</td>
    <td width=564 height=20>Email: dave@socketmobile.com</td>
  </tr>
</table>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<hr>
<p>&nbsp;</p>
<p><b>Forward-Looking Statements</b></p>
<p>This press release includes forward-looking statements. You can identify these
  statements by their forward-looking words such as &quot;may,&quot; &quot;will,&quot;
  &quot;expect,&quot; &quot;anticipate,&quot; &quot;believe,&quot; &quot;guidance,&quot;
  &quot;estimate,&quot; &quot;intend,&quot; predict,&quot; and &quot;continue&quot;
  or similar words or any connection with any discussion of future events or circumstances
  or of management's current estimates or beliefs. Forward-looking statements
  are subject to risks and uncertainties, and therefore results may differ materially
  from those set forth in those statements. More information about the risks and
  challenges faced by DPAC Technologies Corp. is contained in the Securities and
  Exchange Commission filings made by the Company on Form S-4, 10-K, 10-Q or 10-QSB
  and 8-K. DPAC Technologies Corp. specifically disclaims any obligation to update
  or revise any forward-looking statements whether as a result of new information,
  future developments or otherwise. </p>
<p align="center">&nbsp;</p>
<p align="left">&nbsp;</p>
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