ASSET PURCHASE AGREEMENT

Exhibit 10.1

ASSET PURCHASE AGREEMENT

BY AND

AMONG

SOCKET MOBILE, INC.,

DEVELOPMENT CAPITAL VENTURES, LP

AND

QUATECH INC.

TABLE OF CONTENTS

ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT (this “ Agreement ”) is made as of the close of business on September 30, 2009, by and among Socket Mobile, Inc., a Delaware corporation, (“ Seller ”), Development Capital Ventures, LP (“ Funder ”) located at 5820 Fitzhugh Street, Burke, VA 22015, and Quatech Inc., an Ohio corporation (“ Purchaser ”).

1. AGREEMENT TO SELL AND PURCHASE CERTAIN ASSETS

1.1 Agreement to Sell and Purchase.

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 serial card business (the “ Business ”), 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, “ Encumbrances ”). 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:

(a) The tangible personal property and assets of Seller, including without limitation the property listed on Schedule 1.1 (a) to this Agreement, related to or used in the Business (the “ Assets ”) as currently conducted and as currently proposed to be conducted;

(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 Schedule 1.1 (b) to this Agreement (the “ Seller Contracts ”) ;

(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 “ Seller Owned Proprietary Rights ”), including all engineering drawings and specifications, data sheets and the Intellectual Property described on Schedule 1.1(c) to this Agreement and including without limitation all rights in and to use the name “Socket Serial” and the date of first use of each such mark in each respective country where such mark is used (the “ Marks , (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 “ Seller Licensed Proprietary Rights Agreements ”), 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 “ Seller Licensed Proprietary Rights ” and together with the Seller Owned Proprietary Rights, the “ Seller Proprietary Rights ”), including the Intellectual Property listed on Schedule 1.1(c)(iii) hereto.

(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).

1.2 Treatment of Liabilities.

(a) In connection with the sale of the Assets to Purchaser, Purchaser will assume only the following liabilities of Seller (collectively, the “ Assumed Liabilities ”): 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 .

(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 “Excluded Liabilities”). All Excluded Liabilities will be solely those of Seller and will be satisfied by Seller, and Purchaser shall have no liability under any circumstances.

1.3 Delivery of Assets.

(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.

(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.

1.4 Supply and Licensing Agreement

Seller is also in the business or designing, manufacturing and selling HIS3 computer chips (the “ Chips ”) which are a component used in the manufacturing of certain of the Assets. The Chips are not included in the definition of “Assets” and are not included in this sale. Seller and Purchaser will enter into a supply, support and limited licensing agreement (the “ Supply and Licensing Agreement ”), 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 “Supply and Licensing Agreement, in substantially the form attached hereto as Exhibit 1.4.

1.5 Transition Services.

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.

2. PURCHASE PRICE

2.1 Purchase Price.

The purchase price (the “ Purchase Price ”) 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.

2.2 Allocation of Purchase Price.

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 “ Allocation ”), 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.

2.3 Transfer Taxes.

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.

3. CLOSING

3.1 Date and Time.

The closing of the transactions contemplated hereby (the “Closing”) shall take place simultaneously with the execution and delivery of this Agreement. The date of the Closing is hereinafter referred to as the “Closing Date.” 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.

3.2 Seller’s Deliveries.

At the Closing, Seller will execute and deliver, or cause to be executed and delivered, to Purchaser the following documents (collectively, the “ Related Agreements ”) or take, or cause to be taken, the following actions:

(a) A Bill of Sale for the Assets (conveying title thereto free and clear of all Encumbrances);

(b) An assignment of trademarks and proprietary rights agreement in the form attached hereto as Exhibit 3.2(d) ;

(c) The Supply and Licensing Agreement;

(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;

(e) Those consents set forth on Schedule 4.3 hereto;

(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

(g) Such other documents and certificates as are required by the terms of this Agreement or as may be reasonably requested by Purchaser.

3.3 Purchaser Deliveries.

At the Closing, Funder and Purchaser will:

3.4 Inventory .

(a) On or before the Closing, Purchaser may elect, at its sole discretion, to issue one or more purchase orders (the “ Purchase Orders ,” and each a “ Purchase Order ”) for delivery to Purchaser in September selected finished goods inventory (“Inventory”) 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.

(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.

4. REPRESENTATIONS AND WARRANTIES OF SELLER

The Seller hereby represents and warrants to, and covenants and agrees with, Purchaser that as of the date hereof:

4.1 Organization of Seller; Authorizations.

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.

4.2 Requisite Power and Authority.

Seller has all requisite corporate authority and power to execute and deliver this Agreement and to perform all transactions contemplated by this Agreement (the “ Transactions ”). 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.

4.3 Seller’s Requisite Consents; Nonviolation.

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 Schedule 4.3 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.

4.4 No Undisclosed Liabilities.

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 Schedule 4.4 .

4.5 Title to Assets.

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.

4.6 Assigned Contract Rights.

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.

4.7 Litigation.

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.

4.8 Intellectual Property.

(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.

(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.

(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.

(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.

(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.

(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.

(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 exclusi