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EX-10 - EXHIBIT 10.1 - SOCKET MOBILE, INC.ex10-1.htm




Washington, DC 20549






Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934



January 8, 2020


Date of Report

(Date of earliest event reported)






(Exact name of registrant as specified in its charter)


Delaware   001-13810   94-3155066
(State or other jurisdiction of incorporation)   (Commission File Number)   (IRS Employer
Identification No.)

39700 Eureka Drive

Newark, CA 94560

(Address of principal executive offices, including zip code)


(510) 933-3000

(Registrant’s telephone number, including area code)


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):

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common stock, $0.001 Par Value per Share SCKT NASDAQ

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]






Item 1.01 Entry Into a Material Definitive Agreement


On January 8, 2020, Socket Mobile (“we” or the “Company”) entered into a Seventh Business Financing Modification Agreement (the “Financing Agreement”) with Western Alliance Bank, an Arizona corporation (“Lender”), which, among other things, extends the maturity date of the Company’s revolving line of credit to January 31, 2022. The original Financing Agreement was dated February 27, 2014 with subsequent modifications dated February 26, 2016, March 20, 2017, January 31, 2018, June 4, 2018, July 30, 2018 and June 14, 2019.


The Financing Agreement contains customary affirmative and negative covenants, including covenants that limit or restrict our ability to, among other things, grant liens, make investments, incur indebtedness, merge or consolidate, dispose of assets, make acquisitions, pay dividends or make distributions, repurchase stock, enter into transactions with affiliates and enter into restrictive agreements, in each case subject to customary exceptions for a credit facility of this size and type. We are also required to maintain compliance with an asset coverage ratio of 1.25 to 1, measured monthly.


The Financing Agreement also contains customary events of default including, among others, payment defaults, breaches of covenants, bankruptcy and insolvency events, cross defaults with certain material indebtedness, judgment defaults, and breaches of representations and warranties. Upon an event of default, Lender may declare all or a portion of our outstanding obligations payable to be immediately due and payable and exercise other rights and remedies provided for under the Financing Agreement.


The foregoing description of the Financing Agreement is qualified in its entirety by reference to the full text of the Seventh Business Financing Modification Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.


Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.


The information set forth in Item 1.01 hereof is incorporated by reference into this Item 2.03.


Item 9.01 Financial Statements and Exhibits


(d) Exhibits.


Exhibit No.   Description
10.1   Seventh Business Financing Modification Agreement dated as of January 8, 2020









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.


Date: January 14, 2020  By:/s/ Lynn Zhao
  Name: Lynn Zhao
Vice President, Finance and Administration
and Chief Financial Officer