Exhibit 10.18(a)

Confidential

AMENDMENT # 1

TO THE

FORD SYNC SYSTEM GEN 2 STATEMENTS OF WORK V2.3

BETWEEN

FORD MOTOR COMPANY

AND

BSQUARE CORPORATION

This Amendment # 1 is entered into as of June 29, 2010 (“Effective Date”) and
shall hereby amend certain terms provided under the Agreement. The “Agreement”
is defined as the SYNC Generation 2 Hardware Design and System Integration
Services Global Terms & Conditions, dated December 30, 2009 (the “GTC”), by and
between BSQUARE Corporation (“Supplier” or “bSQUARE”) and Ford Motor Company
(“Buyer”, “Ford” or “Company”), the SoW’s (Statement of Works – Both Version
2.3), dated December 30, 2009, and the PO (Purchase Order). Unless otherwise
specified below, all definitions, terms and conditions of the Agreement shall
apply to this Amendment # 1.

WHEREAS, Buyer and Supplier have encountered significant cost and project
overruns under the Agreement for the SYNC Generation 2 project and, as a result
of their negotiations, have agreed to the payment of additional fees as
specified in this Amendment # 1;

WHEREAS, the parties have further agreed to restructure the nature of the
working relationship under which program work, including current program work,
is performed because of current program difficulties as provided for in this
Amendment # 1 and, consequently, have also entered into Statement of Work # 3
simultaneous with this Amendment #1.

NOW, THEREFORE, in consideration of the obligations of each of the parties set
forth in this Amendment # 1, the parties hereto agree as follows:

 

1. Purchase Order. By executing this Amendment # 1 Ford agrees to issue a new
purchase order on, or before, June 30, 2010, for SYNC Generation 2 project
deliverables in the amount of the Fee Adjustment set forth in Section 2 below.
Alternatively, Buyer may amend the current PO to increase the related total by
the Fee Adjustment amount, which also must be done on or before June 30, 2010.

 

2. Fee Adjustment Amount. The SOW’s issued under the Agreement are hereby
amended by adding the following deliverables (as provided for via the COS
identified below) and fee adjustments:

 

SYNC GEN 2 Settlement Breakdown

  

Schedule Extension, Labor

     * ** 

BSQUARE’s share of the Extension

     * ** 

Schedule Extension Settlement

     * ** 

Adjustments

  

Adjustment to meet agreed number

     * ** 

Post Job 1 mover to FCC

     * ** 

Cisco 5505 Firewall + Smartnet (Support Ford VPN)

     * ** 

COS 113, 114, 116, 117, 119, and Sunday Bonus

     * ** 

“Fee Adjustment”

   $ 3,782,376   

 

Confidential treatment has been requested for portions of this agreement. This
agreement omits the information subject to the confidential treatment request.
Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission.

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Confidential

 

3. Payment. Buyer agrees to pay to Supplier seventy-five percent (75%) of the
Fee Adjustment on or before June 30, 2010. The remaining twenty-five percent
(25%) of the Fee Adjustment shall be paid on the earlier to occur of Acceptance
(as defined in Section 4(a)) or August 31, 2010.

 

4. The parties agree that Supplier’s obligations to provide the Goods as
provided for under the SOWs shall be amended as follows.

 

  a. Supplier shall commit to eliminate all Severity 1 and Severity 2 bugs as
provided for in Attachment A (the “Sev 1-2 bugs”), which is incorporated herein
by reference. For clarity, Supplier’s responsibility to eliminate Sev 1-2 bugs
shall apply only to those that are attributable to Supplier. Except as provided
in SOW 3, any work completed towards the cost of the elimination of Sev 1-2 bugs
will not be billed to Buyer. If it is subsequently determined that Attachment A
includes a Sev 1-2 bug attributable to Ford or a third-party, Attachment A shall
be modified to remove said Sev 1-2 bugs. “Acceptance” (as defined by the GTC’s)
shall occur the earlier of a) Supplier eliminates all Sev 1-2 bugs on Attachment
A; or b) when “OK to Buy” (as defined by Buyer processes) occurs. Supplier
acknowledges that additional Severity 1 and 2 bugs identified subsequent to the
date of this Amendment that are attributable to Supplier shall remain the
responsibility of Supplier.

 

  b. At Acceptance, Buyer agrees there are no production or performance delays
or other claims for delay attributable to Supplier under the Agreement and Buyer
shall be deemed to have accepted all Goods under the Agreement and all Goods
shall be deemed to conform to all of the requirements in the Agreement.
Following Acceptance, all further work shall be performed by and in accordance
with the FCC as set forth in SOW 3.

 

  c. Buyer agrees that it will accurately classify and triage all existing and
new bugs that are identified.

 

  d. The SOWs shall be modified to specifically eliminate those features and
requirements identified in Attachment B, which is incorporated herein by
reference, and Supplier shall no longer be obligated to deliver those items set
forth Attachment B. Further, Buyer specifically acknowledges that the features
delivered in build # SYNCII_BASE_RELEASE 20100611 incorporate all required
features under the SOWs, as amended, and Buyer agrees that all Goods delivered
under the Agreement up through those delivered in build # 20100624_02
SYNCII_BASE_RELEASE conform to all of the requirements in the Agreement.

 

  e. The final deliverable provided under the SOWs, as amended, will include a
known list of bugs as provided for in Attachment C, which shall be updated as of
the Acceptance Date to include all known bugs as of that date. Attachment C is
incorporated herein by this reference, and those bugs are specifically
acknowledged and accepted by Buyer. As such, these bugs shall not constitute a
bug as provided for under the SOWs or a Defect under the GTC and shall not apply
for purposes of the acceptance criteria outlined in Section IX of the SOWs.

 

  f. The parties further agree that: (i) the Functional Requirements and the
acceptance process as provided for in the Agreement will appropriately reflect
the modifications provided for in Attachments B-C and the effects thereof; and
(ii) Buyer shall not make any claims against Supplier for any damages whatsoever
under the Agreement, after the expiration of the Warranty Period.

 

5. Other Terms. The following additional modifications are made to the GTC. All
such modifications shall apply to all work performed under the Agreement and
shall apply as if originally incorporated into the Agreement as of its effective
date.

 

  a. Section 10.04 of the GTC’s is amended as follows:

10.04 Total Price and Taxes Buyer will be responsible for duty, if applicable,
and tax unless otherwise specified in the Tax Web-Guide. The Supplier will
separately show on its invoice any duties, and any sales tax, which includes the
State of Michigan’s modified gross receipts tax, use tax, value-added tax (VAT)
or similar turnover taxes, levied on the Goods. The Supplier will provide
whatever documents and information the Buyer may require to support taxes paid,
tax reporting, or recovery of VAT. The Supplier will comply with the
requirements of the Tax Web-Guide. The Supplier will pay duty if the delivery
term specified on the Purchase Order requires the Supplier to pay it (see the
Delivery Terms Web-Guide for more details).

 

Confidential treatment has been requested for portions of this agreement. This
agreement omits the information subject to the confidential treatment request.
Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission.

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Confidential

 

  b. Supplier’s Insurance Reimbursement by Buyer

Buyer shall pay Supplier two-hundred seventy-five thousand US dollars ($275,000)
in the aggregate to compensate Supplier for its additional insurance premiums
related to the Agreement, to be invoiced on the Effective Date and paid within
30 days.

 

  c. The first paragraph of Section 22.01 of the GTC’s shall be modified solely
with respect to both SOW’s version 2.3 to read as follows:

Supplier warrants that the goods and services supplied under a PO will be free
from Defects for the Warranty Period. Buyer’s sole remedy for a failure of
Supplier’s warranty obligation is for Supplier to repair or replace. ‘Repair or
replace’ means as the case may be, creating and delivering a software update or
patch if related to software, re-doing work if related to services, or
replacement of hardware if related to hardware and includes paying for the
actual costs of re-manufacture, re-distribution, or re-installation as
applicable, whether incurred by Supplier or by Buyer, up to a maximum of ten
million US dollars, said amount to include all direct and all indirect,
incidental, consequential or special losses, costs, damages or expenses,
incurred as a result.

 

  d. An additional Sentence is added to the end of Section 48.01 of the GTC’s,
which shall read as follows:

Upon the expiration of the Warranty Period as defined in Section 22.01, Buyer
agrees that: (i) Supplier shall not be liable for any direct, indirect,
incidental, consequential or special losses, costs, damages or expenses,
including without limitation any lost profits, lost savings, or other incidental
damages arising out of the Agreement even if the Supplier has been notified of
the potential for such damages, (ii) Buyer expressly waives any right to seek
any monetary damages, remuneration, or other compensation.

 

6. All other terms and conditions of the Agreement are unchanged and remain in
full force and effect. In case of a conflict, the terms of this Amendment # 1
will control and prevail over those contained in the Agreement.

 

7. It is agreed to incorporate this Amendment # 1 into the Agreement on the
Effective Date. This Amendment # 1 shall not be valid or effective unless and
until it is signed by both Supplier and Buyer. This Amendment # 1 may be
executed in counterparts as, for example, by exchanging signed copies by fax
machine.

IN WITNESS WHEREOF, this Amendment # 1 has been duly executed by the parties
hereto, as of the Effective Date.

 

FORD MOTOR COMPANY:       BSQUARE CORPORATION: By:   

/s/ Jason Rodriguez

      By:   

/s/ Scott C. Mahan

Name:   

Jason Rodriguez

      Name:   

Scott C. Mahan

Title:   

Buyer

      Title:   

Chief Financial Officer

Date:   

June 29, 2010

      Date:   

June 29, 2010

 

Confidential treatment has been requested for portions of this agreement. This
agreement omits the information subject to the confidential treatment request.
Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission.

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Confidential

 

Attachment A

*** (4 pages redacted)

 

Confidential treatment has been requested for portions of this agreement. This
agreement omits the information subject to the confidential treatment request.
Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission.

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Confidential

 

Attachment B

*** (7 pages redacted)

 

Confidential treatment has been requested for portions of this agreement. This
agreement omits the information subject to the confidential treatment request.
Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission.

--------------------------------------------------------------------------------

Confidential

 

Attachment C

*** (8 pages redacted)

 

Confidential treatment has been requested for portions of this agreement. This
agreement omits the information subject to the confidential treatment request.
Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission.