EMPLOYMENT AGREEMENT

This employment agreement (hereinafter referred to as the “Agreement”) has been
entered into this 28th day of February with an effective date of April 1, 2010
by and between SCM Microsystems, Inc., a Delaware corporation d/b/a Identive
Group, having its principal executive offices at 1900-B Carnegie Ave., Santa
Ana, CA 92705, United States of America (hereinafter together with all the
companies directly and indirectly controlled by it referred to as the “Company”)
and Manfred Mueller, an individual being resident at Milanstrasse 14, 80435
Landshut, Germany (hereinafter referred to as the “Executive”).

The Executive is appointed Executive Vice President of Identive Group and CEO of
the SCM business, responsible for the overall management and operations of the
SCM business unit including its global sales, manufacturing and technology
operations. The Executive shall be responsible for implementing the Company
policies and strategies within the business units that maybe assigned to the
Executive. The Executive in addition shall be an officer of the Company and part
of its top management team with expected contribution to the overall direction
of the Company.

1. POSITION AND RESPONSIBILITIES

Executive shall serve the Company in the capacity of Executive Vice President,
and CEO of the SCM business and shall fully and faithfully perform such duties
and exercise such powers as are incidental to such position including those
duties set out in the following paragraphs in connection with the business of
the Company and its affiliates.

The Executive shall have overall responsibility management and operations of the
SCM business unit including its global sales, manufacturing and technology
operations. The Executive shall be responsible for implementing the Company
policies and strategies within the business units that maybe assigned to the
Executive from time to time. The Executive in addition shall be an officer of
the Company and part of its top management team with expected contribution to
the overall direction of the Company. Executive shall fully and faithfully
perform such duties and fulfil such obligations, as are commensurate with his
appointment as Executive. Executive shall devote his full attention by using his
best efforts to apply his skills and experience to perform his duties hereunder
and promote the interests of the business and projects of the Company.

The Executive acknowledges that he may be required to work beyond the normal
work week for the proper performance of his duties, and that he shall not
receive further remuneration in respect of such additional hours.

The Executive shall be normally based in Ismaning, Germany; however the Company
will cover all of the Executive’s reasonable travel and communication costs to
the Company’s other offices.

The Executive agrees to travel on the Company’s business as may be required for
the proper performance of his duties under this Agreement.

2. COMPENSATION

a) Fixed salary: During the term of this Agreement, the Executive shall be paid
an amount of Euro 150’000 per year, payable in 12 equal monthly instalments, as
fixed salary, less the Executive’s share of social costs.

b) Bonus: For services rendered during the term of this Agreement the Executive
shall be paid an annual bonus (hereinafter referred to as the “Bonus”) depending
on EBIT growth both organic and acquisitive allowing for 100% of salary to be
received 50% cash and 50% in shares of the Company with a 36 months lock up or
deferral. The exact amount of the Bonus and the criteria for achieving the bonus
shall be subject to change and shall be determined by the CEO & Chairman and the
compensation committee of the Company.

c) Peak Bonus: For services rendered during the term of this Agreement the
Executive shall be paid a peak bonus (hereinafter referred to as the “Peak
Bonus”) on achieving further growth of the EBIT figure of the Company and the
share price of the Company payable in 36 months options, vesting after 12 months
equivalent in number to salary and bonus in U.S. Dollars. For example, if the
annual salary amounts to $100’000 U.S. Dollars and the Bonus to $75’000 U.S.
Dollars then the Executive will be entitled to get the equivalent of $175’000
U.S. Dollars in share options. The Executive acknowledges and agrees that the
exact structure of the Peak Bonus may have to be adjusted to fit with applicable
law and stock exchange requirements, including the laws of Germany, and the
requirements of the NASDAQ Stock Market and the Frankfurt Stock Exchange, and
that the exact amount of the Peak Bonus and the criteria for achieving the Peak
Bonus shall be subject to change and shall be determined by the CEO & Chairman
and the compensation committee of the Company.

d) Break-up Fee. The break-up fee of Fifty Thousand Euro (€50,000) (the
“Break-up Fee”) that the Company shall pay at a time to be mutually agreed upon
by the Company and the Executive pursuant to the terms of the certain
Termination Agreement and Release, dated the date hereof, among the Company, SCM
Microsystems GmbH, and the Executive, shall be deducted from the future cash
bonus payments that the Executive would otherwise be entitled to receive under
Sections 2(b) and 2(c) hereof.

3. BENEFITS, PERQUISITES AND BUSINESS EXPENSES

a) The Executive shall be entitled to participate in any Stock Option Plan of
the Company on such terms as may be determined by the Chairman or the Board of
Directors of the Company.

b) The Executive shall be entitled to be reimbursed for all reasonable expenses
incurred by the Executive in connection with the conduct of the business of the
Company pursuant to this Agreement. Such expenses shall be reimbursed within
thirty (30) days following presentation of sufficient evidence of such
expenditures.

c) The Company shall provide the Executive with customary benefits which are
subject to change from time to time at the discretion of the Company.

d) The Executive shall be entitled to five (5) weeks of paid vacation per annum
in addition to all the local holidays in Germany.

e) The Company shall provide the Executive with a Company car in accordance with
its Company Car policy which may also be used privately. By mutual agreement the
Executive may receive a respective car allowance instead of a company car
according to the Company’s car guideline. The Company’s car guideline as in
force from time to time shall apply additionally.

4. TERM AND TERMINATION

a) The initial term of this Agreement begins on March 1, 2010 and runs for a
24-month period (the “Initial Term”), which term may be extended for an
additional 24-month period by the mutual consent of the parties hereto prior to
the expiration of the Initial Term.

b) Termination by the Company or Executive without cause: The Company or the
Executive shall be entitled to terminate this Agreement at any time without
cause by giving the other party twelve (12) months prior written notice of the
termination but the Company shall be required to continue to pay the Executive’s
monthly fixed salary and the bonus payments pro rata until the end of the notice
period.

c) Termination by the Company for cause: The Company shall be entitled to
terminate this Agreement for cause at any time without notice and without any
payment in lieu of notice. In the event of termination for cause, the Company’s
obligations hereunder shall immediately cease and terminate and Executive shall
be immediately relieved of all of his responsibilities and authorities as an
officer, director and employee of the Company and as an officer, director and
employee of each and every affiliate in the Company and in such an event there
will be no continued monthly salary, fee or any other payments by the Company to
the Executive. For purposes of this paragraph 4(c), “cause” shall include,
without limitation, the following circumstances:

  i)   The Executive has committed a criminal offence involving moral turpitude
or has improperly enriched himself at the expense of the Company.

  ii)   Executive, in carrying out his duties hereunder, (i) has been wilfully
and grossly negligent, or (ii) has committed wilful and gross misconduct or,
(iii) has failed to comply with a lawful instruction or directive from the CEO,
CFO or the COO of the Company and which is not otherwise cured within thirty
(30) days of notice of such breach,

  iii)   The Executive has breached a material term of this Agreement and which
is not cured within ninety (90) days.

Termination of this Agreement for cause shall be effective upon the date of the
notice of termination given to the Executive and the lapse of any applicable
cure period without remedy of the matters set out in such notice.

d) Effect of Termination: The Executive agrees that, upon termination of this
Agreement for any reason whatsoever, Executive shall thereupon be deemed to have
immediately resigned any position that Executive may have as an officer,
director or employee of the Company and each and every affiliate of the Company.
In such event, Executive shall, at the request of the Company or any affiliate
in the Company, forthwith execute any and all documents appropriate to evidence
such resignation. The Executive shall not be entitled to any payment in respect
of such resignation in addition to those provided for herein, except as
expressly provided for pursuant to any other agreement entered into with any
affiliate in the Company.

e) Survival of Terms: It is expressly agreed that notwithstanding termination of
this Agreement for any reason or cause or in any circumstances whatsoever, such
termination shall be without prejudice to the rights and obligations of the
Executive and the Company respectively in relation to the time up to and
including the date of termination and the provisions of paragraphs 3(b), 7 and 8
of this Agreement, all of which shall remain and continue in full force and
effect.

5. CONFIDENTIAL INFORMATION

a) The Executive agrees not to disclose, either during the term of this
Agreement or at any time for a period of three years thereafter, to any person
not employed by the Company or by any affiliate of the Company or not engaged to
render services to the Company or to any affiliate in the Company, any trade
secrets or confidential information of or relating to the Company or any
affiliate of the Company obtained by the Executive during the term hereof;
provided, however, that this provision shall not preclude the Executive from the
use or disclosure of information known generally to the public (other than that
which the Executive may have disclosed in breach of this Agreement) or of
information required to be disclosed by law or court order applicable to the
Executive or information authorized to be disclosed by the CEO, COO or the CFO
of the Company.

b) The Executive also agrees that upon termination of this Agreement for any
reason whatsoever, Executive will not take, without the prior written consent of
the CEO, COO or CFO of the Company, any drawing, blueprint, specification,
report or other document belonging or relating to the Company or to any
affiliate in the Company.

6. NON-COMPETITION, NON-SOLICITATION

a) The Executive agrees that during the period of this Agreement, the Executive
shall not engage in or participate in any entity in any industry that competes,
directly or indirectly, with the businesses of the Company or any affiliate in
the Company. The Executive agrees that during the period of this Agreement and
for 12 months thereafter, the Executive shall not solicit any business or any
employee or any consultant from the Company or any of its affiliates.

b) During the Term of this Agreement, the Executive undertakes to seek the prior
written approval of the CEO, COO or the CFO of the Company before accepting any
new board or advisory positions.

7. NOTICES

Any notices, requests, demands or other communications provided for by this
Agreement shall be in writing and shall be sufficiently given when and if mailed
by registered or certified mail, return receipt requested, postage prepaid, or
sent by personal delivery, overnight courier or by facsimile to the party
entitled thereto at the address stated at the beginning of this Agreement or at
such other address as the parties may have specified by similar notice.

Any such notice shall be deemed delivered on the tenth business day following
the mailing thereof if delivered by prepaid post or if given by means of
personal delivery on the day of delivery thereof or if given by means of courier
or facsimile transmission on the first business day following the dispatch
thereof.

8. ASSIGNMENT

The respective rights and obligations of the Company under this Agreement shall
be assignable to SCM Microsystems GmbH, a wholly-owned subsidiary of the Company
(the “Permitted Assignment”). With the exception of the Permitted Assignment,
the respective rights and obligations of the Executive and the Company under
this Agreement shall not be assignable by either party without the written
consent of the other party and shall, subject to the foregoing, ensure to the
benefit of and be binding upon the Executive and the Company and their permitted
successors or assigns. Nothing herein expressed or implied is intended to confer
on any person other than the parties hereto any rights, remedies, obligations or
liabilities under or by reason of this Agreement.

9. APPLICABLE LAW

This Agreement shall be deemed a contract under, and for all purposes shall be
governed by and construed in accordance with the law of Germany. This Agreement
has been drafted in English. In case of contradictions between the English
version and a version prepared in any other language, the English version shall
prevail.

10. ARBITRATION

In the event of any dispute, claim, question, or disagreement arising from or
relating to this Agreement or the breach thereof, the parties hereto shall use
their best efforts to settle the dispute, claim, question, or disagreement. To
this effect, they shall consult and negotiate with each other in good faith and,
recognizing their mutual interests, attempt to reach a just and equitable
solution satisfactory to both parties. If they do not reach such solution within
a period of 60 days, then, upon notice by either party to the other, all
disputes, claims, questions, or differences shall be finally settled by
arbitration administered by the American Arbitration Association in accordance
with the provisions of its Commercial Arbitration Rules. The proceedings shall
be held in the English language and the seat of the arbitral tribunal shall be
in the city of Munich, Germany, with one arbitrator and with each party bearing
their own costs.

11. AMENDMENT OR MODIFICATION; WAIVER

No provision of this Agreement may be amended or waived unless such amendment or
waiver is authorized by the Company (including any authorized officer or
committee of the Board of Directors) and signed by the Executive. Except as
otherwise specifically provided in this Agreement, no waiver by either party
hereto of any breach by the other party of any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of a
similar or dissimilar breach, condition or provision at the same time or at any
prior or subsequent time.

12. ENTIRE AGREEMENT

This Agreement contains the entire agreement between the parties hereto with
respect to the matters herein and supersedes all prior agreements and
understandings, oral or written, between the parties hereto, relating to such
matters.

In witness whereof, the parties hereto have duly executed this Agreement in two
counterparts on the date first above written.

      SCM Microsystems, Inc.   EXECUTIVE
By: /s/ Ayman S. Ashour
  By: /s/ Manfred Mueller
 
   
Name: Ayman S. Ashour
  Name: Manfred Mueller

Title: Chairman of the Board