EXHIBIT 10.1

CONSENT AND SEVENTH AMENDMENT

TO

LOAN AND SECURITY AGREEMENT

THIS CONSENT AND SEVENTH AMENDMENT to Loan and Security Agreement (this
“Amendment”) is entered into this 28th day of September, 2007, by and among
Silicon Valley Bank (“Bank”), Relm Wireless Corporation, a Nevada corporation
(“Relm Wireless”), and Relm Communications, Inc., a Florida corporation (“Relm
Communications ” and, together with Relm Wireless, the “Borrower”) whose address
is 7100 Technology Drive, West Melbourne, Florida  32904.

RECITALS

A.

Bank and Borrower have entered into that certain Loan and Security Agreement
dated as of August 29, 2003, as previously amended (as the same may from time to
time be further amended, modified, supplemented or restated, the “Loan
Agreement”).  

B.

Bank has extended credit to Borrower for the purposes permitted in the Loan
Agreement.  

C.

Borrower has requested that Bank (i) amend the Loan Agreement to (i) adjust the
amount of the Tangible Net Worth covenant contained therein, and (ii) consent to
the payment by Relm Wireless of a one-time special dividend of $0.50 per share
of the common stock of Relm Wireless.

D.

Bank has agreed to so amend certain provisions of the Loan Agreement and to
consent to the payment of such special dividend, but only to the extent, in
accordance with the terms, subject to the conditions and in reliance upon the
representations and warranties set forth below.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing recitals and other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, and intending to be legally bound, the parties hereto agree as
follows:

1.

Definitions.  Capitalized terms used but not defined in this Consent shall have
the meanings given to them in the Loan Agreement.

2.

Amendments to Loan Agreement.

2.1

Section 5 (Financial Covenants).  Section 5 of the Amended and Restated Schedule
to Loan and Security agreement is amended in its entirety and replaced with the
following:

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FINANCIAL COVENANTS

(Section 5.1):

Borrower shall comply with each of the following covenants.  Compliance shall be
determined as of the end of each month, except as otherwise specifically
provided below:

Tangible Net Worth:

Borrower shall maintain at all times, to be tested as of the last day of each
quarter, on a consolidated basis with respect to Borrower and its Subsidiaries,
a Tangible Net Worth of at least $25,000,000, increasing by (a) 50% of quarterly
profits, commencing with the quarter beginning July 1, 2007, and (b) 75% of the
amount received in respect of issuances of equity and the principal amount of
the issuance of Subordinated Debt, in each case received after July 1, 2007.

Adjusted Quick Ratio:

Borrower shall maintain as of the end of each quarter an Adjusted Quick Ratio of
at least 2:00 to 1.00.

Definitions.

For purposes of the foregoing financial covenants, the following term shall have
the following meaning:

“Adjusted Quick Ratio” means, as of any date, the ratio of (x) Quick Assets to
(y) Current Liabilities less Deferred Revenues; where

“Quick Assets” are, on such date, the Borrower’s consolidated, unrestricted
cash, cash equivalents, and net billed accounts receivable, all determined
according to GAAP;

“Current Liabilities” are the aggregate amount of Borrower’s Total Liabilities
which mature within one (1) year; and

“Total Liabilities” are, on any day, obligations that should, under GAAP, be
classified liabilities on Borrower’s consolidated balance sheet, including all
debt and current portion of subordinated debt allowed to be paid, but excluding
all other subordinate debt.

“Deferred Revenue” is all amounts received in advance of performance under
maintenance, licensing and service contracts and not yet recognized as revenue.

“Tangible Net Worth” is, on any date, the consolidated total assets of Borrower
and its Subsidiaries minus (a) any amounts attributable to (i) goodwill, (ii)
intangible items including unamortized debt discount and expense, patents, trade
and service marks and names, copyrights and research and

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development expenses except prepaid expenses, (iii) notes, accounts receivable
and other obligations owing to Borrower from its officers or other Affiliates,
and (iv) reserves not already deducted from assets, minus (b) Total Liabilities
, plus (c) Subordinated Debt; where:

“Subordinated Debt” is indebtedness incurred by Borrower and subordinated to all
of Borrower’s now or hereafter indebtedness to Bank (pursuant to a
subordination, intercreditor, or other similar agreement in form and substance
satisfactory to Bank entered into between Bank and the other creditor), on terms
acceptable to Bank; and.

“Total Liabilities” is on any day, obligations that should, under GAAP, be
classified as liabilities on Borrower’s consolidated balance sheet, including
all Indebtedness, and current portion of Subordinated Debt permitted by Bank to
be paid by Borrower.

3.

Consent.  The Bank hereby consents to the payment of a one time special dividend
of $0.50 per share of common stock of Relm Wireless by not later than November
30, 2007, provided that no such dividend may be paid at any time an Event of
Default or Default either exists under the Loan Agreement or would result from
the payment of any such dividend.

4.

Limitation of Amendments.

4.1

The amendments set forth in Section 2 above and the consent set forth in Section
3 above are effective for the purposes set forth herein and shall be limited
precisely as written and shall not be deemed to (a) be a consent to any
amendment, waiver or modification of any other term or condition of any Loan
Document, or (b) otherwise prejudice any right or remedy which Bank may now have
or may have in the future under or in connection with any Loan Document.

4.2

This Amendment shall be construed in connection with and as part of the Loan
Documents and all terms, conditions, representations, warranties, covenants and
agreements set forth in the Loan Documents, except as herein amended, are hereby
ratified and confirmed and shall remain in full force and effect.

5.

Representations and Warranties.  To induce Bank to enter into this Amendment,
Borrower hereby represents and warrants to Bank as follows:

5.1

Immediately after giving effect to this Amendment (a) the representations and
warranties contained in the Loan Documents are true, accurate and complete in
all material respects as of the date hereof (except to the extent such
representations and warranties relate to an earlier date, in which case they are
true and correct as of such date), and (b) no Event of Default has occurred and
is continuing;

5.2

Borrower has the power and authority to execute and deliver this Amendment and
to perform its obligations under the Loan Agreement, as amended by this
Amendment;

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5.3

The organizational documents of Borrower most recently delivered to Bank remain
true, accurate and complete and have not been amended, supplemented or restated
and are and continue to be in full force and effect;

5.4

The execution and delivery by Borrower of this Amendment and the performance by
Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, have been duly authorized;

5.5

The execution and delivery by Borrower of this Amendment and the performance by
Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do not and will not contravene (a) any law or regulation binding on
or affecting Borrower, (b) any contractual restriction with a Person binding on
Borrower, (c) any order, judgment or decree of any court or other governmental
or public body or authority, or subdivision thereof, binding on Borrower, or
(d) the organizational documents of Borrower;

5.6

The execution and delivery by Borrower of this Amendment and the performance by
Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do not require any order, consent, approval, license, authorization
or validation of, or filing, recording or registration with, or exemption by any
governmental or public body or authority, or subdivision thereof, binding on
either Borrower, except as already has been obtained or made; and

5.7

This Amendment has been duly executed and delivered by Borrower and is the
binding obligation of Borrower, enforceable against Borrower in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium or other similar laws of
general application and equitable principles relating to or affecting creditors’
rights.

6.

Counterparts.  This Amendment may be executed in any number of counterparts and
all of such counterparts taken together shall be deemed to constitute one and
the same instrument.

7.

Effectiveness.  This Amendment shall be deemed effective upon (a) the due
execution and delivery to Bank of this Amendment by each party hereto,
(b) Borrower’s payment of an amendment fee in an amount equal to $1,500, and
(c) Borrower’s payment of Bank’s legal fees and expenses in connection with the
negotiation and preparation of this Consent.  

[Signature page follows.]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.

BANK

     

BORROWER

  

 

 

Silicon Valley Bank

 

Relm Wireless Corporation

  

 

 

  

 

 

By:

 /s/ SCOTT MCCARTY

 

By:

  /s/ WILLIAM P. KELLY

Name:

M. SCOTT MCCARTY

 

Name:

William P. Kelly

Title:

Relationship  Manager

 

Title:

Executive Vice President

  

 

 

 

  

 

Relm Communications, Inc.

  

 

 

  

 

 

 

 

 

By:

/s/ WILLIAM P. KELLY

 

 

 

Name: 

William P. Kelly

 

 

 

Title:

Executive Vice President

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