# EDGAR Filing Document

**Accession Number:** 0001069533
**File Stem:** 0001437749-23-008244
**Filing Date:** 2023-3
**Character Count:** 182974
**Document Hash:** 2fa5077183c833b245d960507971c594
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001437749-23-008244.hdr.sgml**: 20230328

**ACCESSION NUMBER**: 0001437749-23-008244

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 17

**CONFORMED PERIOD OF REPORT**: 20230324

**ITEM INFORMATION**: Entry into a Material Definitive Agreement

**ITEM INFORMATION**: Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230328

**DATE AS OF CHANGE**: 20230328

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** RGC RESOURCES INC
- **CENTRAL INDEX KEY:** 0001069533
- **STANDARD INDUSTRIAL CLASSIFICATION:** NATURAL GAS TRANSMISSION & DISTRIBUTION [4923]
- **IRS NUMBER:** 541909697
- **STATE OF INCORPORATION:** VA
- **FISCAL YEAR END:** 0930

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-26591
- **FILM NUMBER:** 23770591

**BUSINESS ADDRESS:**
- **STREET 1:** 519 KIMBALLAVENUE N.E.
- **CITY:** ROANOKE
- **STATE:** VA
- **ZIP:** 24016
- **BUSINESS PHONE:** 5407774427

**MAIL ADDRESS:**
- **STREET 1:** 519 KIMBALL AVENUE N.E.
- **CITY:** ROANOKE
- **STATE:** VA
- **ZIP:** 24016

rgco20230328_8k.htm

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM **8-K**

**CURRENT REPORT**

**PURSUANT TO SECTION 13 OR 15(d) OF**

**THE SECURITIES EXCHANGE ACT OF 1934**

**Date of Report (Date of Earliest Event Reported): **March 24, 2023**

## RGC RESOURCES, INC.
**(Exact name of Registrant as specified in its charter)**

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| | | |
|:---|:---|:---|
| **Virginia** | **000-26591** | **54-1909697** |
| **(State or other jurisdiction**<br> **of incorporation)** | **(Commission**<br> **File Number)** | **(IRS Employer**<br> **Identification No.)** |

---

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| | |
|:---|:---|
| **519 Kimball Ave., **N.E. Roanoke**, **Virginia** | **24016** |
| **(Address of principal executive offices)** | **(Zip Code)** |

---

**Registrant**'**s telephone number, including area code: **540**-**777-4427**

**(Former name or former address, if changed since last report)**

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:

☐ 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:

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| | | |
|:---|:---|:---|
| **<u>Title of Each Class</u>** | **<u>Trading Symbol</u>** | **<u>Name of Each Exchange on Which Registered</u>** |
| **Common Stock, $5 Par Value** | **RGCO** | **NASDAQ Global Market** |

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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 if the Securities Exchange Act of 1934.

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| | |
|:---|:---|
| Emerging growth company | ☐ |

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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.

☐<br>

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| | |
|:---|:---|
| ITEM 1.01 | ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT. |

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On March 24, 2023, Roanoke Gas Company ("Roanoke"), the utility subsidiary of RGC Resources, Inc. ("Resources"), entered into a Promissory Note in the principal amount of $25,000,000 (the "Revolving Note") with Pinnacle Bank ("Pinnacle"). The Revolving Note will mature on March 31, 2024. The Revolving Note replaces the Revolving Line of Credit Note dated March 31, 2022 with Wells Fargo Bank, N.A., which matures on March 31, 2023.

The purpose of the Revolving Note is to provide working capital financing for Roanoke's operations and bridge financing for its infrastructure enhancement and replacement projects. The Revolving Note's variable interest rate is based upon Term SOFR plus 110 basis points and multiple tier borrowing limits to accommodate seasonal borrowing demands.

Also, on March 24, 2023, Roanoke amended and restated the $10,000,000 Promissory Note (the "Amended Term Note") entered on September 24, 2021 with Pinnacle. The amendment revised the original Term Note's interest rate from LIBOR plus 100 basis points to Term SOFR plus 100 basis points. All other terms and requirements of the original Term Note were retained. The effective date of the Amended Term Loan is April 1, 2023.

In connection with the Revolving Note and Amended Term Note, on March 24, 2023, Roanoke also amended and restated the Loan Agreement ("Amended Loan Agreement") with Pinnacle dated September 24, 2021. The amendment provides for borrowing limits on the Revolving Note that range from $4,000,000 to a maximum of $25,000,000 during it's term, requires Roanoke and Resources to establish operating accounts and treasury services with Pinnacle and amends certain financial conditions required of Roanoke and Resources. All other terms and requirements of the original Loan Agreement were retained.

Also, on March 24, 2023, the Guaranty Agreement previously entered into on September 24, 2021 by Resources with Pinnacle was amended and restated to reflect the Amended Loan Agreement.

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| | |
|:---|:---|
| ITEM 2.03 | CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT. |

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The information required by this Item 2.03 is set forth in Item 1.01 above in respect of the Notes, which is incorporated herein by reference.

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| | |
|:---|:---|
| ITEM 9.01 | FINANCIAL STATEMENTS AND EXHIBITS. |

---

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| | |
|:---|:---|
| (d) Exhibits. |  |
| 10.1 | [Promissory Note (Revolving Loan) in the principal amount of $25,000,000 by Roanoke Gas Company with Pinnacle Bank, dated March 24, 2023.](ex_493947.htm) |
| 10.2 | [Amended and Restated Promissory Note (Term Loan) in the principal amount of $10,000,000 by Roanoke Gas Company with Pinnacle Bank, dated March 24, 2023 (effective as of April 1, 2023).](ex_493948.htm) |
| 10.3 | [Amended and Restated Loan Agreement by and between Roanoke Gas Company and Pinnacle Bank, dated March 24, 2023.](ex_493949.htm) |
| 10.4 | [Amended and Restated Guaranty Agreement by RGC Resources, Inc. with Pinnacle Bank, dated March 24, 2023.](ex_493950.htm) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |

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SIGNATURES

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.

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| | | |
|:---|:---|:---|
|  |  | RGC RESOURCES, INC. |
| Date: March 28, 2023 | By: | /s/ Jason A. Field |
|  |  | Jason A. Field |
|  |  | Vice President, Chief Financial Officer and Treasurer |
|  |  | (Principal Financial Officer) |

---

## Exhibit 10.1

**Exhibit 10.1**

**PROMISSORY NOTE**

(Revolving Loan)

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| | |
|:---|:---|
| $25000000.00 | March 24, 2023 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR VALUE RECEIVED, the undersigned, **ROANOKE GAS COMPANY**, a Virginia corporation ("<u>Borrower</u>") unconditionally promises to pay to the order of **PINNACLE BANK** (the "<u>Bank</u>"), without offset or deduction at 202 Campbell Avenue SE, Roanoke, Virginia 24013 or such other address as Bank shall designate, in lawful money of the United States of America, the principal sum of up to **TWENTY-FIVE MILLION AND NO/100 DOLLARS ($25,000,000.00)**, or so much thereof as may be advanced and unpaid, together with interest at the rate(s) specified herein from the date on which any portion of the loan (the "<u>Loan</u>") evidenced by this note (as modified, amended, renewed, restated or replaced from time to time, this "<u>Note</u>") shall be advanced until paid in full.

**1. <u>LOAN AGREEMENT</u>.** Terms not otherwise defined herein shall have the meaning ascribed in that certain Amended and Restated Loan Agreement dated of even date herewith by and among Bank, Borrower and certain other parties named therein (modified, amended, renewed, restated or replaced from time to time, the "<u>Loan Agreement</u>"). This Note is the "Revolving Note" as such term is defined in the Loan Agreement and is subject to the terms and provisions of the Loan Agreement. All rules of construction set forth in the Loan Agreement shall apply to this Note. So long as no Event of Default has occurred or is continuing, the principal sum hereof may be advanced periodically in accordance with the terms of the Loan Agreement, and Bank is hereby authorized to make such advances under this Note as set forth in the Loan Agreement; provided, however, that for the avoidance of doubt, the maximum amount of principal available hereunder shall be governed and controlled by the terms of the Loan Agreement notwithstanding the maximum face amount of this Note.

**2. <u>DEFINED TERMS</u>.** As used in this Note, the following terms shall have the meanings indicated below:

<u>"Applicable Rate</u>" means, for any day, Term SOFR (or, if applicable, the Benchmark Replacement) for a one-month tenor in effect on such day <u>plus</u> one and one tenth percent (1.10%). Any change in Term SOFR or the Benchmark Replacement shall be effective from and including the effective date of such change in Term SOFR or the Benchmark Replacement.

<u>"Available Tenor</u>" means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if such Benchmark is a term rate, any tenor for such Benchmark (or component thereof) that is or may be used for determining the length of an interest period pursuant to this Note or (y) otherwise, any payment period for interest calculated with reference to such Benchmark (or component thereof) that is or may be used for determining any frequency of making payments of interest calculated with reference to such Benchmark, in each case, as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of "Interest Period" pursuant to Section 3(d) hereof.

<u>"Benchmark</u>" means, initially, the Term SOFR Reference Rate; <u>provided</u> that if a Benchmark Transition Event has occurred with respect to the Term SOFR Reference Rate or the then-current Benchmark, then "Benchmark" means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 3(a).

<u>"Benchmark Replacement</u>" means with respect to any Benchmark Transition Event, the sum of: (a) the alternate benchmark rate that has been selected by Bank giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for Dollar-denominated syndicated credit facilities and (b) the related Benchmark Replacement Adjustment.

<u>"Benchmark Replacement Adjustment</u>" means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by Bank giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for Dollar-denominated syndicated credit facilities.

<u>"Benchmark Replacement Date</u>" means the earliest to occur of the following events with respect to the then-current Benchmark:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in the case of clause (a) or (b) of the definition of "Benchmark Transition Event", the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in the case of clause (c) of the definition of "Benchmark Transition Event", the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by or on behalf of the administrator of such Benchmark (or such component thereof) or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be non-representative or non-compliant with or non-aligned with the International Organization of Securities Commissions' ("<u>IOSCO</u>") Principles for Financial Benchmarks; <u>provided</u> that such non-representativeness, non-compliance or non-alignment will be determined by reference to the most recent statement or publication referenced in such clause (c) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date.

For the avoidance of doubt, the "Benchmark Replacement Date" will be deemed to have occurred in the case of clause (a) or (b) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

<u>"Benchmark Transition Start Date</u>" means, in the case of a Benchmark Transition Event, the earlier of (a) the applicable Benchmark Replacement Date and (b) if such Benchmark Transition Event is a public statement or publication of information of a prospective event, the 90th day prior to the expected date of such event as of such public statement or publication of information (or if the expected date of such prospective event is fewer than 90 days after such statement or publication, the date of such statement or publication).

<u>"Benchmark Transition Event</u>" means the occurrence of one or more of the following events with respect to the then-current Benchmark:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely; <u>provided</u> that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component) that states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely; <u>provided</u> that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are not, or as of a specified future date will not be, representative or in compliance with or aligned with IOSCO's Principles for Financial Benchmarks.

For the avoidance of doubt, a "Benchmark Transition Event" will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).

<u>"Business Day</u>" means any day that is not a Saturday, Sunday or other day that is a legal holiday under the laws of the State of New York or is a day on which banking institutions in such state are authorized or required by Law to close.

<u>"Conforming Changes</u>" means, with respect to either the use or administration of Term SOFR or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of "Business Day," the definition of "U.S. Government Securities Business Day," the definition of "Interest Period" or any similar or analogous definition (or the addition of a concept of an "interest period"), timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, and other technical, administrative or operational matters) that Bank decides may be appropriate to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by Bank in a manner substantially consistent with market practice (or, if Bank decides that adoption of any portion of such market practice is not administratively feasible or if Bank determines that no market practice for the administration of any such rate exists, in such other manner of administration as Bank decides is reasonably necessary in connection with the administration of this Note and the other Loan Documents).

<u>"Dollar</u>" and "<u>$</u>" means the lawful money of the United States of America.

<u>"Federal Reserve Board</u>" means the Board of Governors of the Federal Reserve System of the United States.

<u>"Interest Period</u>" means, the period commencing on the date of the applicable advance made to Borrower and ending on the numerically corresponding day in the calendar month that is one month thereafter (in each case, subject to the availability thereof); <u>provided</u> that (i) if the Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period, and (iii) no Interest Period shall extend beyond the Maturity Date.

<u>"Periodic Term SOFR Determination Day</u>" has the meaning specified in the definition of "Term SOFR".

<u>"Relevant Governmental Body</u>" means the Federal Reserve Board or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board or the Federal Reserve Bank of New York, or any successor thereto.

<u>"SOFR</u>" means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.

<u>"SOFR Administrator</u>" means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

<u>"Term SOFR</u>" means the Term SOFR Reference Rate for a tenor comparable to the applicable Interest Period on the day (such day, the "<u>Periodic Term SOFR Determination Day</u>") that is two (2) U.S. Government Securities Business Days prior to the first day of such Interest Period, as such rate is published by the Term SOFR Administrator; <u>provided</u>, however, that if as of 5:00 p.m. (New York City time) on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Periodic Term SOFR Determination Day.

<u>"Term SOFR Administrator</u>" means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by Bank in its reasonable discretion).

<u>"Term SOFR Reference Rate</u>" means the forward-looking term rate based on SOFR.

<u>"Unadjusted Benchmark Replacement</u>" means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

<u>"U.S. Government Securities Business Day</u>" means any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

**3. <u>INTEREST RATE</u>**. The principal balance of this Note will bear interest at the Applicable Rate. The Applicable Rate is not necessarily the lowest rate, or the basis for the lowest rate, charged by Bank on its loans. In no event shall the Applicable Rate exceed the maximum rate allowed by applicable law. Interest shall be calculated on the basis of a 360-day year using the actual number of days for which the calculation is being made. If Borrower makes payments of interest, fees or other charges, however denominated, which payments result in an effective Applicable Rate exceeding the maximum rate of interest allowed under applicable law, then any such excess is hereby waived by Bank and shall be applied in reduction of the principal balance hereof or, if such excess is greater than the unpaid principal amount hereof, the difference shall be paid by Bank to Borrower. In connection with the use or administration of Term SOFR, Bank will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of Borrower or any other party to any other Loan Document. Bank will promptly notify Borrower of the effectiveness of any Conforming Changes in connection with the use or administration of Term SOFR.

**4. <u>DEFAULT RATE</u>**. Following the occurrence and during the continuance of an Event of Default or after the maturity of this Note, whether by acceleration or otherwise, interest will be due and payable on the unpaid principal balance at an annual rate equal to **three percent (3%)** above the Applicable Rate otherwise in effect from time to time (the "<u>Default Rate</u>").

**5. <u>REPAYMENT TERMS</u>**. Consecutive monthly payments of accrued interest on the outstanding principal balance of this Note shall be due and payable in arrears on the **first (1<sup>st</sup>)** day of each month, commencing **April 1, 2023** and continuing on the same day of each month thereafter until fully paid; *provided, however*, that if the scheduled payment date is not a Business Day, then any payment scheduled to be made on such day shall instead be made on the next succeeding Business Day. The entire outstanding principal balance, together with all accrued but unpaid interest thereon, if any, and all other charges hereunder shall be due and payable on **March 31, 2024** (the "<u>Maturity Date</u>").

**6. <u>PREPAYMENT</u>**. Borrower may prepay the Loan, in whole or in part, at any time and from time to time, without premium or penalty of any kind. A partial prepayment shall not postpone the due date of any subsequent scheduled payment.

**7. <u>APPLICATION OF PAYMENTS</u>**. Monies received by Bank from any source for application toward payment of the Obligations due under this Note shall be applied first to unpaid late charges or other fees or charges due under the Loan Documents, then to accrued but unpaid interest, and the balance to the reduction of principal and payment of Obligations, in each case as deemed appropriate by Bank in its sole discretion. Upon the occurrence and during the continuance of an Event of Default, monies may be applied to the Obligations in any manner or order deemed appropriate by Bank. If any payment received by Bank under this Note or the other Loan Documents is rescinded, avoided or for any reason returned by Bank because of any adverse claim or threatened action, the returned payment shall remain payable as an obligation of all persons liable under this Note or other Loan Documents as though such payment had not been made.

**8. <u>BENCHMARK REPLACEMENT</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Benchmark Replacement</u>. Notwithstanding anything to the contrary herein or in any other Loan Document, upon the occurrence of a Benchmark Transition Event, this Note shall be deemed amended to replace the then-current Benchmark with the Benchmark Replacement. Any such amendment with respect to a Benchmark Transition Event will become effective at 5:00 p.m. (New York City time) on the fifth (5<sup>th</sup>) Business Day after Bank notifies Borrower of such Benchmark Replacement; provided, however, that no replacement of a Benchmark with a Benchmark Replacement pursuant to this Section 8(a) will occur prior to the applicable Benchmark Transition Start Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Benchmark Replacement Conforming Changes</u>. In connection with the use, administration, adoption or implementation of a Benchmark Replacement, Bank will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Note or any other Loan Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Notices; Standards for Decisions and Determinations</u>. Bank will promptly notify Borrower of (i) the implementation of any Benchmark Replacement and (ii) the effectiveness of any Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. Bank will promptly notify Borrower of the removal or reinstatement of any tenor of a Benchmark pursuant to Section 3(d). Any determination, decision or election that may be made by Bank pursuant to this Section 3, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its sole discretion and without consent from any other party to this Note or any other Loan Document, except, in each case, as expressly required pursuant to this Section 3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Unavailability of Tenor of Benchmark</u>. Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including the Term SOFR Reference Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by Bank in its reasonable discretion or (B) the administrator of such Benchmark or the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is not or will not be representative or in compliance with or aligned with IOSCO's Principles for Financial Benchmarks, then Bank may modify the definition of "Interest Period" (or any similar or analogous definition) for any Benchmark settings at or after such time to remove such unavailable, non-representative, non-compliant or non-aligned tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is not or will not be representative or in compliance with or aligned with IOSCO's Principles for Financial Benchmarks for a Benchmark (including a Benchmark Replacement), then Bank may modify the definition of "Applicable Rate" and/or "Interest Period" (or any similar or analogous definition) for all Benchmark settings at or after such time to reinstate such previously removed tenor.

**9. <u>LATE CHARGE</u>**. At the option of Bank, Borrower agrees to pay a service charge of up to **five percent (5.0%)** of any installment, including any required tax and insurance accruals, not paid within **seven (7) days** following the due date thereof, which service charge is to cover the extra expense involved in handling late payments.

**10. <u>DEFAULT AND ACCELERATION</u>**. If (a) subject to the applicable notice and cure period set forth in the Loan Agreement, any monthly installment under this Note is not paid when due, or (b) subject to any applicable grace, notice and/or cure period set forth in the Loan Agreement, the undersigned or any other Obligor fails to timely observe or perform any covenant, condition or undertaking contained herein or in the Loan Agreement or any other Loan Document, or there shall exist any default or event of default (however denominated) under any of the Loan Documents (an "<u>Event of Default</u>"); then after the occurrence of an Event of Default and following the expiration of any applicable grace, notice or cure period set forth in the Loan Agreement, (i) to the extent applicable, Bank shall have no further obligation to initiate additional advances under the Loan, and (ii) without additional notice or demand, at the option of Bank, the entire outstanding principal balance of this Note, together with all accrued, unpaid interest thereon and all other charges due hereunder or under any other Loan Document shall at once become due and payable in full, and Bank shall have the right to exercise all rights and remedies available to it under the Loan Documents and/or applicable law. Failure to exercise any such option or right shall not constitute a waiver of the right to exercise any such option or right in the event of any subsequent Event of Default. In addition, Bank shall have the right, immediately and without notice or further action by it, to set-off against this Note all obligations for money or money's worth owed by Bank in any capacity to Borrower, whether or not due.

**11. <u>WAIVERS; COVENANTS AND CONDITIONS</u>**. Borrower hereby waives presentment, demand, protest and notice of dishonor; waives the benefit of all homestead and similar exemptions as to this Note; waives any right which it may have to require Bank to proceed against Borrower, any other Obligor or any property securing this Note, and agrees that its liability hereunder shall not be affected or impaired by the release or discharge of any Obligor from liability hereunder, the release or discharge of any collateral securing this Note or by any failure, neglect or omission of Bank to exercise any remedies of set-off or otherwise that it may have or by any determination that any security interest or lien taken by Bank to secure this Note is invalid or unperfected; agrees to pay all reasonable costs and expenses incurred by Bank in connection with the enforcement of this Note, and the collection of the indebtedness evidenced hereby, and the collection of any judgment rendered hereon, and/or the preservation or disposition of any property or collateral securing the payment hereof, and/or the defense of any claim arising out of, or in any way related to, this Note or any deed of trust or security agreement or other instrument securing this Note or related to the making of the Loan evidenced hereby, including, without limitation, reasonable attorney's fees if this Note is placed in the hands of an attorney for collection, or if Bank finds it necessary to secure the services or advice of an attorney with regard to collection hereof or the preservation or disposition of any property or collateral securing this Note. This Note may be renewed, extended, modified, refinanced or otherwise amended (specifically including, but not limited to, an increase of the principal amount due hereunder and the Applicable Rate) by agreement between Bank and Borrower without notice to any Obligor or any other party. No such renewal, extension, modification, refinance or amendment or otherwise shall be deemed or construed as a release by Bank of any Obligor or any other party from its obligations, regardless of whether such party had any notice thereof.

**12. <u>NOTICES</u>.** All notices, requests, demands and other communications with respect hereto shall be given in accordance with the provisions of the Loan Agreement.

**13. <u>SAVINGS CLAUSE</u>.** Nothing contained herein shall be construed or shall operate either presently or prospectively (a) to require Borrower to make any payment or to take any action contrary to applicable law or (b) to permit Bank to take any action contrary to applicable law. Should any one or more of the terms, provisions, covenants or conditions of this Note or any other Loan Document be held to be void, invalid, illegal or unenforceable in any respect, the same shall, at the option of Bank, not affect any other term, provision, covenant or condition of this Note or such Loan Document, but the remainder hereof or thereof, as applicable, shall be effective as though such term, provision, covenant or condition had never been contained herein or therein, as applicable.

**14. <u>SUBSTITUTED SERVICE OF PROCESS</u>**. It is understood and agreed that Borrower thereby subjects itself to the in personam jurisdiction of any duly constituted Court of the Commonwealth of Virginia (upon compliance with procedural laws and rules of the Commonwealth of Virginia) wherein any action may be brought by the holder of this Note for the enforcement thereof.

**15. <u>BUSINESS PURPOSES</u>**. Borrower hereby represents to Bank that the Loan is for business purposes and no part of the proceeds of this Note will be used for personal, family or household purposes.

**16. <u>PATRIOT ACT NOTICE</u>.** To help fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. For purposes of this section, account shall be understood to include loan accounts.

**17. <u>TIME OF THE ESSENCE</u>**. Time is of the essence as to each and every provision of this Note and the Loan Documents.

**18. <u>MISCELLANEOUS PROVISIONS</u>**. The term "Bank" used herein shall include any future holder of this Note. This Note shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia. This Note shall be the joint and several obligation of all makers, sureties, guarantors and endorsers, and shall be binding upon them and their heirs, legal and personal representatives, successors and assigns. The undersigned covenant and agree that if an Event of Default occurs under this Note, the Event of Default shall constitute a default in any and all other notes wherein Borrower is the obligor and Bank is the obligee.

**19. <u>WAIVER OF RIGHT TO JURY TRIAL</u>**. BORROWER HEREBY WAIVES TRIAL BY JURY IN REGARD TO ANY CAUSES OF ACTION, CLAIMS, OBLIGATIONS, DAMAGES OR ANY COMPLAINTS WHICH BORROWER MAY HAVE RISING OUT OF THIS NOTE, OR ANY OF THE LOAN DOCUMENTS, OR IN ANY ACTION OR PROCEEDING WHICH THE HOLDER HEREOF MAY BRING TO ENFORCE ANY PROVISION OF THE LOAN DOCUMENTS. BY EXECUTION OF THIS NOTE BORROWER HEREBY REPRESENTS THAT BORROWER IS REPRESENTED BY COMPETENT COUNSEL WHO HAS FULLY AND COMPLETELY ADVISED BORROWER OF THE MEANING AND RAMIFICATIONS OF THE WAIVER OF THE RIGHT TO A TRIAL BY JURY.

**20. <u>LIMITATION ON LIABILITY; WAIVER OF PUNITIVE DAMAGES</u>. EACH OF THE PARTIES HERETO, INCLUDING BANK BY ACCEPTANCE HEREOF, AGREES THAT IN ANY JUDICIAL, MEDIATION OR ARBITRATION PROCEEDING OR ANY CLAIM OR CONTROVERSY BETWEEN OR AMONG THEM THAT MAY ARISE OUT OF OR BE IN ANY WAY CONNECTED WITH THIS NOTE, THE LOAN DOCUMENTS OR ANY OTHER AGREEMENT OR DOCUMENT BETWEEN OR AMONG THEM OR THE OBLIGATIONS EVIDENCED HEREBY OR RELATED HERETO, IN NO EVENT SHALL ANY PARTY HAVE A REMEDY OF, OR BE LIABLE TO THE OTHER FOR, (1) INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OR (2) PUNITIVE OR EXEMPLARY DAMAGES. EACH OF THE PARTIES HEREBY EXPRESSLY WAIVES ANY RIGHT OR CLAIM TO PUNITIVE OR EXEMPLARY DAMAGES THEY MAY HAVE OR WHICH MAY ARISE IN THE FUTURE IN CONNECTION WITH ANY SUCH PROCEEDING, CLAIM OR CONTROVERSY, WHETHER THE SAME IS RESOLVED BY ARBITRATION, MEDIATION, JUDICIALLY OR OTHERWISE.** 

[SIGNATURE PAGE FOLLOWS]

------

**PROMISSORY NOTE**

(Revolving Loan)

[SIGNATURE PAGE]

WITNESS the following signature and seal as of the date first written above.

---

| |
|:---|
| **BORROWER:** |
| ROANOKE GAS COMPANY, a Virginia corporation |
| By: <u>/s/ Paul W. Nester</u> (SEAL)<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Paul W. Nester,<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;President and CEO |
| and |
| By: <u>/s/ Jason A. Field</u> (SEAL)<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jason A. Field,<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vice President, CFO and Treasurer |

---

## Exhibit 10.2

**Exhibit 10.2**

**AMENDED AND RESTATED PROMISSORY NOTE**

(Term Loan)

---

| | |
|:---|:---|
| $10000000.00 | Executed March 24, 2023 |
|  | Effective as of April 1, 2023 |

---

**THIS AMENDED AND RESTATED PROMISSORY NOTE HEREBY AMENDS AND RESTATES THAT CERTAIN PROMISSORY NOTE MADE BY BORROWER IN THE ORIGINAL PRINCIPAL AMOUNT OF $10,000,000.00 PAYABLE TO THE ORDER OF BANK DATED AS OF SEPTEMBER 24, 2021, AS THE SAME MAY HAVE BEEN MODIFIED OR AMENDED FROM TIME TO TIME. NO NOVATION IS INTENDED HEREBY.**

FOR VALUE RECEIVED, the undersigned, **ROANOKE GAS COMPANY**, a Virginia corporation ("<u>Borrower</u>") unconditionally promises to pay to the order of **PINNACLE BANK** (the "<u>Bank</u>"), without offset or deduction at 202 Campbell Avenue SE, Roanoke, Virginia 24013 or such other address as Bank shall designate, in lawful money of the United States of America, the principal sum of **TEN MILLION AND NO/100 DOLLARS ($10,000,000.00)**, or so much thereof as may be advanced and unpaid, together with interest at the rate(s) specified herein from the date on which any portion of the loan (the "<u>Loan</u>") evidenced by this note (as modified, amended, renewed, restated or replaced from time to time, this "<u>Note</u>") shall be advanced until paid in full.

**1. <u>LOAN AGREEMENT</u>.** Terms not otherwise defined herein shall have the meaning ascribed in that certain Amended and Restated Loan Agreement dated of even date herewith by and among Bank, Borrower and certain other parties named therein (modified, amended, renewed, restated or replaced from time to time, the "<u>Loan Agreement</u>"). This Note is the "Term Note" as such term is defined in the Loan Agreement and is subject to the terms and provisions of the Loan Agreement. All rules of construction set forth in the Loan Agreement shall apply to this Note.

**2. <u>DEFINED TERMS</u>.** As used in this Note, the following terms shall have the meanings indicated below:

<u>"Applicable Rate</u>" means, for any day, Term SOFR (or, if applicable, the Benchmark Replacement) <u>plus</u> one percent (1.00%). Any change in Term SOFR or the Benchmark Replacement shall be effective from and including the effective date of such change in Term SOFR or the Benchmark Replacement.

<u>"Available Tenor</u>" means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if such Benchmark is a term rate, any tenor for such Benchmark (or component thereof) that is or may be used for determining the length of an interest period pursuant to this Note or (y) otherwise, any payment period for interest calculated with reference to such Benchmark (or component thereof) that is or may be used for determining any frequency of making payments of interest calculated with reference to such Benchmark, in each case, as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of "Interest Period" pursuant to Section 3(d) hereof.

<u>"Benchmark</u>" means, initially, the Term SOFR Reference Rate; <u>provided</u> that if a Benchmark Transition Event has occurred with respect to the Term SOFR Reference Rate or the then-current Benchmark, then "Benchmark" means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 3(a).

<u>"Benchmark Replacement</u>" means with respect to any Benchmark Transition Event, the sum of: (a) the alternate benchmark rate that has been selected by Bank giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for Dollar-denominated syndicated credit facilities and (b) the related Benchmark Replacement Adjustment.

<u>"Benchmark Replacement Adjustment</u>" means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by Bank giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for Dollar-denominated syndicated credit facilities.

<u>"Benchmark Replacement Date</u>" means the earliest to occur of the following events with respect to the then-current Benchmark:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in the case of clause (a) or (b) of the definition of "Benchmark Transition Event", the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in the case of clause (c) of the definition of "Benchmark Transition Event", the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by or on behalf of the administrator of such Benchmark (or such component thereof) or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be non-representative or non-compliant with or non-aligned with the International Organization of Securities Commissions' ("<u>IOSCO</u>") Principles for Financial Benchmarks; <u>provided</u> that such non-representativeness, non-compliance or non-alignment will be determined by reference to the most recent statement or publication referenced in such clause (c) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date.

For the avoidance of doubt, the "Benchmark Replacement Date" will be deemed to have occurred in the case of clause (a) or (b) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

<u>"Benchmark Transition Start Date</u>" means, in the case of a Benchmark Transition Event, the earlier of (a) the applicable Benchmark Replacement Date and (b) if such Benchmark Transition Event is a public statement or publication of information of a prospective event, the 90th day prior to the expected date of such event as of such public statement or publication of information (or if the expected date of such prospective event is fewer than 90 days after such statement or publication, the date of such statement or publication).

<u>"Benchmark Transition Event</u>" means the occurrence of one or more of the following events with respect to the then-current Benchmark:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely; <u>provided</u> that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component) that states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely; <u>provided</u> that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are not, or as of a specified future date will not be, representative or in compliance with or aligned with IOSCO's Principles for Financial Benchmarks.

For the avoidance of doubt, a "Benchmark Transition Event" will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).

<u>"Business Day</u>" means any day that is not a Saturday, Sunday or other day that is a legal holiday under the laws of the State of New York or is a day on which banking institutions in such state are authorized or required by Law to close.

<u>"Conforming Changes</u>" means, with respect to either the use or administration of Term SOFR or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of "Business Day," the definition of "U.S. Government Securities Business Day," the definition of "Interest Period" or any similar or analogous definition (or the addition of a concept of an "interest period"), timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, and other technical, administrative or operational matters) that Bank decides may be appropriate to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by Bank in a manner substantially consistent with market practice (or, if Bank decides that adoption of any portion of such market practice is not administratively feasible or if Bank determines that no market practice for the administration of any such rate exists, in such other manner of administration as Bank decides is reasonably necessary in connection with the administration of this Note and the other Loan Documents).

<u>"Dollar</u>" and "<u>$</u>" means the lawful money of the United States of America.

<u>"Federal Reserve Board</u>" means the Board of Governors of the Federal Reserve System of the United States.

<u>"Interest Period</u>" means, the period commencing on the date of the applicable advance made to Borrower and ending on the numerically corresponding day in the calendar month that is one month thereafter (in each case, subject to the availability thereof); <u>provided</u> that (i) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period, and (ii) no Interest Period shall extend beyond the Maturity Date.

<u>"Periodic Term SOFR Determination Day</u>" has the meaning specified in the definition of "Term SOFR".

<u>"Relevant Governmental Body</u>" means the Federal Reserve Board or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board or the Federal Reserve Bank of New York, or any successor thereto.

<u>"SOFR</u>" means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.

<u>"SOFR Administrator</u>" means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

<u>"Term SOFR</u>" means the Term SOFR Reference Rate for a tenor comparable to the applicable Interest Period on the day (such day, the "<u>Periodic Term SOFR Determination Day</u>") that is two (2) U.S. Government Securities Business Days prior to the first day of such Interest Period, as such rate is published by the Term SOFR Administrator; <u>provided</u>, however, that if as of 5:00 p.m. (New York City time) on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Periodic Term SOFR Determination Day.

<u>"Term SOFR Administrator</u>" means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by Bank in its reasonable discretion).

<u>"Term SOFR Reference Rate</u>" means the forward-looking term rate based on SOFR.

<u>"Unadjusted Benchmark Replacement</u>" means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

<u>"U.S.</u><u> </u><u>Government Securities Business Day</u>" means any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

**3. <u>INTEREST RATE</u>**. The principal balance of this Note will bear interest at the Applicable Rate. The Applicable Rate is not necessarily the lowest rate, or the basis for the lowest rate, charged by Bank on its loans. In no event shall the Applicable Rate exceed the maximum rate allowed by applicable law. Interest shall be calculated on the basis of a 360-day year using the actual number of days for which the calculation is being made. If Borrower makes payments of interest, fees or other charges, however denominated, which payments result in an effective Applicable Rate exceeding the maximum rate of interest allowed under applicable law, then any such excess is hereby waived by Bank and shall be applied in reduction of the principal balance hereof or, if such excess is greater than the unpaid principal amount hereof, the difference shall be paid by Bank to Borrower. In connection with the use or administration of Term SOFR, Bank will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of Borrower or any other party to any other Loan Document. Bank will promptly notify Borrower of the effectiveness of any Conforming Changes in connection with the use or administration of Term SOFR.

**4. <u>DEFAULT RATE</u>**. Following the occurrence and during the continuance of an Event of Default or after the maturity of this Note, whether by acceleration or otherwise, interest will be due and payable on the unpaid principal balance at an annual rate equal to **three percent (3%)** above the Applicable Rate otherwise in effect from time to time (the "<u>Default Rate</u>").

**5. <u>REPAYMENT TERMS</u>**. Consecutive monthly payments of accrued interest on the outstanding principal balance of this Note shall be due and payable in arrears on the **first (1<sup>st</sup>)** day of each month, commencing **May 1, 2023** and continuing on the same day of each month thereafter until fully paid; *provided, however*, that if the scheduled payment date is not a Business Day, then any payment scheduled to be made on such day shall instead be made on the next succeeding Business Day. The entire outstanding principal balance, together with all accrued but unpaid interest thereon, if any, and all other charges hereunder shall be due and payable on **October 1, 2028** (the "<u>Maturity Date</u>").

**6. <u>PREPAYMENT PENALTY</u>**. Subject to the terms and provisions of this Section 6, Borrower may prepay the Loan, in whole or in part, at any time and from time to time, without premium or penalty of any kind. A partial prepayment shall not postpone the due date of any subsequent scheduled payment. Upon any payment or prepayment of the Loan (regardless of whether such prepayment is made as a result of acceleration, voluntary prepayment or otherwise, and regardless of the source of funds), Borrower shall pay to Bank an amount equal to any fees or costs provided in the applicable Swap Agreement. ***In amplification of the foregoing, any prepayment of the Loan prior to the Maturity Date may require termination of all or a portion of any related Swap Transaction. The termination of any such Swap Transaction may result in a payment due from or to Borrower and shall be subject to the applicable termination fees as provided for under such Swap Agreement.***

**7. <u>APPLICATION OF PAYMENTS</u>**. Monies received by Bank from any source for application toward payment of the Obligations due under this Note shall be applied first to unpaid late charges or other fees or charges due under the Loan Documents, then to accrued but unpaid interest, and the balance to the reduction of principal hereunder and payment of Swap Obligations, in each case as deemed appropriate by Bank in its sole discretion. Upon the occurrence and during the continuance of an Event of Default, monies may be applied to the Obligations in any manner or order deemed appropriate by Bank. If any payment received by Bank under this Note or the other Loan Documents is rescinded, avoided or for any reason returned by Bank because of any adverse claim or threatened action, the returned payment shall remain payable as an obligation of all persons liable under this Note or other Loan Documents as though such payment had not been made.

**8. <u>BENCHMARK REPLACEMENT</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Benchmark Replacement</u>. Notwithstanding anything to the contrary herein or in any other Loan Document, upon the occurrence of a Benchmark Transition Event, this Note shall be deemed amended to replace the then-current Benchmark with the Benchmark Replacement. Any such amendment with respect to a Benchmark Transition Event will become effective at 5:00 p.m. (New York City time) on the fifth (5<sup>th</sup>) Business Day after Bank notifies Borrower of such Benchmark Replacement; provided, however, that no replacement of a Benchmark with a Benchmark Replacement pursuant to this Section 8(a) will occur prior to the applicable Benchmark Transition Start Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Benchmark Replacement Conforming Changes</u>. In connection with the use, administration, adoption or implementation of a Benchmark Replacement, Bank will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Note or any other Loan Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Notices; Standards for Decisions and Determinations</u>. Bank will promptly notify Borrower of (i) the implementation of any Benchmark Replacement and (ii) the effectiveness of any Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. Bank will promptly notify Borrower of the removal or reinstatement of any tenor of a Benchmark pursuant to Section 3(d). Any determination, decision or election that may be made by Bank pursuant to this Section 3, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its sole discretion and without consent from any other party to this Note or any other Loan Document, except, in each case, as expressly required pursuant to this Section 3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Unavailability of Tenor of Benchmark</u>. Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including the Term SOFR Reference Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by Bank in its reasonable discretion or (B) the administrator of such Benchmark or the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is not or will not be representative or in compliance with or aligned with IOSCO's Principles for Financial Benchmarks, then Bank may modify the definition of "Interest Period" (or any similar or analogous definition) for any Benchmark settings at or after such time to remove such unavailable, non-representative, non-compliant or non-aligned tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is not or will not be representative or in compliance with or aligned with IOSCO's Principles for Financial Benchmarks for a Benchmark (including a Benchmark Replacement), then Bank may modify the definition of "Applicable Rate" and/or "Interest Period" (or any similar or analogous definition) for all Benchmark settings at or after such time to reinstate such previously removed tenor.

**9. <u>LATE CHARGE</u>**. At the option of Bank, Borrower agrees to pay a service charge of up to **five percent (5.0%)** of any installment, including any required tax and insurance accruals, not paid within **seven (7) days** following the due date thereof, which service charge is to cover the extra expense involved in handling late payments.

**10. <u>DEFAULT AND ACCELERATION</u>**. If (a) subject to the applicable notice and cure period set forth in the Loan Agreement, any monthly installment under this Note is not paid when due, or (b) subject to any applicable grace, notice and/or cure period set forth in the Loan Agreement, the undersigned or any other Obligor fails to timely observe or perform any covenant, condition or undertaking contained herein or in the Loan Agreement or any other Loan Document (specifically including, without limitation, any Swap Agreement or any document or instrument evidencing any Swap Obligation), or there shall exist any default or event of default (however denominated) under any of the Loan Documents (an "<u>Event of Default</u>"); then after the occurrence of an Event of Default and following the expiration of any applicable grace, notice or cure period set forth in the Loan Agreement, (i) to the extent applicable, Bank shall have no further obligation to initiate additional advances under the Loan, and (ii) without additional notice or demand, at the option of Bank, the entire outstanding principal balance of this Note, together with all accrued, unpaid interest thereon and all other charges due hereunder or under any other Loan Document shall at once become due and payable in full, and Bank shall have the right to exercise all rights and remedies available to it under the Loan Documents and/or applicable law. Failure to exercise any such option or right shall not constitute a waiver of the right to exercise any such option or right in the event of any subsequent Event of Default. In addition, Bank shall have the right, immediately and without notice or further action by it, to set-off against this Note all obligations for money or money's worth owed by Bank in any capacity to Borrower, whether or not due.

**11. <u>WAIVERS; COVENANTS AND CONDITIONS</u>**. Borrower hereby waives presentment, demand, protest and notice of dishonor; waives the benefit of all homestead and similar exemptions as to this Note; waives any right which it may have to require Bank to proceed against Borrower, any other Obligor or any property securing this Note, and agrees that its liability hereunder shall not be affected or impaired by the release or discharge of any Obligor from liability hereunder, the release or discharge of any collateral securing this Note or by any failure, neglect or omission of Bank to exercise any remedies of set-off or otherwise that it may have or by any determination that any security interest or lien taken by Bank to secure this Note is invalid or unperfected; agrees to pay all reasonable costs and expenses incurred by Bank in connection with the enforcement of this Note, and the collection of the indebtedness evidenced hereby, and the collection of any judgment rendered hereon, and/or the preservation or disposition of any property or collateral securing the payment hereof, and/or the defense of any claim arising out of, or in any way related to, this Note or any deed of trust or security agreement or other instrument securing this Note or related to the making of the Loan evidenced hereby, including, without limitation, reasonable attorney's fees if this Note is placed in the hands of an attorney for collection, or if Bank finds it necessary to secure the services or advice of an attorney with regard to collection hereof or the preservation or disposition of any property or collateral securing this Note. This Note may be renewed, extended, modified, refinanced or otherwise amended (specifically including, but not limited to, an increase of the principal amount due hereunder and the Applicable Rate) by agreement between Bank and Borrower without notice to any Obligor or any other party. No such renewal, extension, modification, refinance or amendment or otherwise shall be deemed or construed as a release by Bank of any Obligor or any other party from its obligations, regardless of whether such party had any notice thereof.

**12. <u>NOTICES</u>.** All notices, requests, demands and other communications with respect hereto shall be given in accordance with the provisions of the Loan Agreement.

**13. <u>SAVINGS CLAUSE</u>.** Nothing contained herein shall be construed or shall operate either presently or prospectively (a) to require Borrower to make any payment or to take any action contrary to applicable law or (b) to permit Bank to take any action contrary to applicable law. Should any one or more of the terms, provisions, covenants or conditions of this Note or any other Loan Document be held to be void, invalid, illegal or unenforceable in any respect, the same shall, at the option of Bank, not affect any other term, provision, covenant or condition of this Note or such Loan Document, but the remainder hereof or thereof, as applicable, shall be effective as though such term, provision, covenant or condition had never been contained herein or therein, as applicable.

**14. <u>SUBSTITUTED SERVICE OF PROCESS</u>**. It is understood and agreed that Borrower thereby subjects itself to the in personam jurisdiction of any duly constituted Court of the Commonwealth of Virginia (upon compliance with procedural laws and rules of the Commonwealth of Virginia) wherein any action may be brought by the holder of this Note for the enforcement thereof.

**15. <u>BUSINESS PURPOSES</u>**. Borrower hereby represents to Bank that the Loan is for business purposes and no part of the proceeds of this Note will be used for personal, family or household purposes.

**16. <u>PATRIOT ACT NOTICE</u>.** To help fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. For purposes of this section, account shall be understood to include loan accounts.

**17. <u>TIME OF THE ESSENCE</u>**. Time is of the essence as to each and every provision of this Note and the Loan Documents.

**18. <u>MISCELLANEOUS PROVISIONS</u>**. The term "<u>Bank</u>" used herein shall include any future holder of this Note. This Note shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia. This Note shall be the joint and several obligation of all makers, sureties, guarantors and endorsers, and shall be binding upon them and their heirs, legal and personal representatives, successors and assigns. The undersigned covenant and agree that if an Event of Default occurs under this Note, the Event of Default shall constitute a default in any and all other notes wherein Borrower is the obligor and Bank is the obligee.

**19. <u>WAIVER OF RIGHT TO JURY TRIAL</u>**. BORROWER HEREBY WAIVES TRIAL BY JURY IN REGARD TO ANY CAUSES OF ACTION, CLAIMS, OBLIGATIONS, DAMAGES OR ANY COMPLAINTS WHICH BORROWER MAY HAVE RISING OUT OF THIS NOTE, OR ANY OF THE LOAN DOCUMENTS, OR IN ANY ACTION OR PROCEEDING WHICH THE HOLDER HEREOF MAY BRING TO ENFORCE ANY PROVISION OF THE LOAN DOCUMENTS. BY EXECUTION OF THIS NOTE BORROWER HEREBY REPRESENTS THAT BORROWER IS REPRESENTED BY COMPETENT COUNSEL WHO HAS FULLY AND COMPLETELY ADVISED BORROWER OF THE MEANING AND RAMIFICATIONS OF THE WAIVER OF THE RIGHT TO A TRIAL BY JURY.

**20. <u>LIMITATION ON LIABILITY; WAIVER OF PUNITIVE DAMAGES</u>. EACH OF THE PARTIES HERETO, INCLUDING BANK BY ACCEPTANCE HEREOF, AGREES THAT IN ANY JUDICIAL, MEDIATION OR ARBITRATION PROCEEDING OR ANY CLAIM OR CONTROVERSY BETWEEN OR AMONG THEM THAT MAY ARISE OUT OF OR BE IN ANY WAY CONNECTED WITH THIS NOTE, THE LOAN DOCUMENTS OR ANY OTHER AGREEMENT OR DOCUMENT BETWEEN OR AMONG THEM OR THE OBLIGATIONS EVIDENCED HEREBY OR RELATED HERETO, IN NO EVENT SHALL ANY PARTY HAVE A REMEDY OF, OR BE LIABLE TO THE OTHER FOR, (1) INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OR (2) PUNITIVE OR EXEMPLARY DAMAGES. EACH OF THE PARTIES HEREBY EXPRESSLY WAIVES ANY RIGHT OR CLAIM TO PUNITIVE OR EXEMPLARY DAMAGES THEY MAY HAVE OR WHICH MAY ARISE IN THE FUTURE IN CONNECTION WITH ANY SUCH PROCEEDING, CLAIM OR CONTROVERSY, WHETHER THE SAME IS RESOLVED BY ARBITRATION, MEDIATION, JUDICIALLY OR OTHERWISE.** 

[SIGNATURE PAGE FOLLOWS]

------

**AMENDED AND RESTATED PROMISSORY NOTE**

(Term Loan)

[SIGNATURE PAGE]

WITNESS the following signature and seal as of the date first written above.

---

| |
|:---|
| **BORROWER:** |
| ROANOKE GAS COMPANY, a Virginia corporation |
| By: <u>/s/ Paul W. Nester</u> (SEAL)<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Paul W. Nester,<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;President and CEO |
| and |
| By: <u>/s/ Jason A. Field</u> (SEAL)<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jason A. Field,<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vice President, CFO and Treasurer |

---

## Exhibit 10.3

**Exhibit 10.3**

**AMENDED AND RESTATED LOAN AGREEMENT**

**THIS AMENDED AND RESTATED LOAN AGREEMENT HEREBY AMENDS AND RESTATES THAT CERTAIN LOAN AGREEMENT BY AND BETWEEN BANK AND BORROWER DATED AS OF SEPTEMBER 24, 2021, AS THE SAME MAY HAVE BEEN MODIFIED OR AMENDED FROM TIME TO TIME. NO NOVATION IS INTENDED HEREBY.**

**THIS AMENDED AND RESTATED LOAN AGREEMENT** (this "<u>Agreement</u>"), dated as of March 24, 2023, is made by and between **ROANOKE GAS COMPANY**, a Virginia corporation (the "<u>Borrower</u>") and **PINNACLE BANK** ("<u>Bank</u>").

**<u>RECITALS</u>:**

Bank has agreed to extend the Loan (as hereinafter defined) to Borrower, on and subject to the terms, provisions and conditions contained herein, the proceeds of which are to be used by Borrower for its general working capital purposes, including, without limitation, refinancing existing indebtedness and/or financing ongoing utility capital programs or other infrastructure improvements.

**<u>AGREEMENT</u>:**

For and in consideration of the premises, the mutual covenants and agreements contained herein, and other good and valuable considerations, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. **<u>DEFINITIONS AND RULES OF CONSTRUCTION</u>**

1.01 <u>Definitions</u>. As used in this Agreement, the terms listed below shall have the following meanings unless otherwise required by the context:

<u>"Affiliate</u>" means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

<u>"Agreement</u>" means this Agreement, as modified, amended, replaced, supplemented, substituted, restated and/or replaced from time to time.

<u>"Bank</u>" has the meaning ascribed in the first paragraph of this Loan Agreement, and includes any future holder of the Note, and for purposes of, and in connection with, any Swap Transaction, "<u>Bank</u>" means Pinnacle Bank and any affiliate thereof in its capacity as a party to a Swap Transaction.

<u>"Borrower</u>" has the meaning ascribed in the first paragraph of this Agreement, and includes any and all makers or endorsers of the Note, whether existing now or in the future.

<u>"Business Day</u>" means any day other than a Saturday, Sunday or other day on which commercial banks in Roanoke, Virginia are authorized or required by law to close.

<u>"Closing Date</u>" means the date of this Agreement.

<u>"Consolidated Long Term Debt</u>" means, as of the date of any determination thereof, the total of all Long Term Debt for any Person and its Subsidiaries outstanding on such date, after eliminating all offsetting debits and credits between such Person and its Subsidiaries and all other items required to be eliminated in the course of the preparation of consolidated financial statements of such Person and its Subsidiaries in accordance with GAAP.

<u>"Consolidated Stockholders'</u> <u>Equity</u>" means, as of the date of any determination thereof, the stockholders' equity of any Person which would be shown on a consolidated balance sheet of such Person and its Subsidiaries as of such time prepared in accordance with GAAP.

<u>"Consolidated Total Assets</u>" means, at any time, the total assets of any Person which would be shown on a consolidated balance sheet of such Person and its Subsidiaries as of such time prepared in accordance with GAAP.

<u>"Consolidated Total Capitalization</u>" means, as of the date of any determination thereof, the sum of (i) Consolidated Long Term Debt, plus (ii) current maturities of Consolidated Long Term Debt, plus (iii) Consolidated Stockholders' Equity.

<u>"Control</u>" means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. "Controlling" and "Controlled" have meanings correlative thereto.

<u>"Default</u>" means any event or circumstance which, with the lapse of time, the giving of notice or both, would constitute an Event of Default.

<u>"Disposition</u>" or "<u>Dispose</u>" means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.

<u>"EBIT to Interest Ratio</u>" means, for any Person, the sum of earnings before interest and taxes, divided by interest expense; provided, however, that non-cash impairment charges shall be excluded from this ratio calculation provided Borrower and Guarantor are in compliance with each other covenant in this Agreement after giving effect to such non-cash impairment charges.

"<u>Equity Interest</u>" means shares of capital stock, partnership interests, membership interests, beneficial interests, voting rights, or other equity interests in any entity, or any obligations convertible into or exchangeable for, or giving any person a right, option or warrant to acquire such equity interests or such convertible or exchangeable obligations.

<u>"Event of Default</u>" means the occurrence of any of the events described in **Section 7.01** hereof.

<u>"GAAP</u>" means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

<u>"Guarantor</u>" has the meaning ascribed in the first paragraph of this Agreement, and includes any and all guarantors of the Loan, whether existing now or in the future.

<u>"Guaranty Agreement</u>" means, collectively, whether one or more in number, the agreement of Guarantor to unconditionally guarantee all or any portion of the Obligations, and any future guaranty agreement executed and delivered by a Guarantor, in each case, as amended, modified, substituted, restated and/or replaced from time to time.

<u>"Guarantee</u>" means, as to any Person, any (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the "primary obligor") in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien). The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith. The term "Guarantee" as a verb has a corresponding meaning.

<u>"Indebtedness</u>" means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

(b) all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers' acceptances, bank guaranties, surety bonds and similar instruments;

(c) net obligations of such Person under any Swap Agreement;

(d) all obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts (i) payable in the ordinary course of business and, in each case, (ii) not past due for more than 60 days after the date on which such trade account payable was created unless the trade account is being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been provided in accordance with GAAP);

(e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;

(f) capital leases and Synthetic Lease Obligations;

(g) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interest in such Person or any other Person, valued, in the case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends; and

(h) all Guarantees of such Person in respect of any of the foregoing.

For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person. The amount of any net obligation under any Swap Agreement on any date shall be deemed to be the Swap Termination Value thereof as of such date. The amount of any capital lease or Synthetic Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date. For purposes hereof, "Indebtedness" shall not include obligations for rental under operating or "true" leases.

<u>"Legal Requirements</u>" means all existing and future laws, codes, ordinances, rules, regulations, orders and decrees of governmental authorities and courts having jurisdiction over the Borrower.

<u>"Lien</u>" means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).

<u>"Loan</u>" or "<u>Loans</u>" means, collectively, whether one or more in number, in any combination, the Term Loan and the Revolving Loan.

<u>"Loan Agreement</u>" means this Agreement, as modified, amended, replaced, supplemented, substituted, restated and/or replaced from time to time.

<u>"Loan Documents</u>" means the Note, the Guaranty Agreement, this Agreement, all Swap Agreements, together with every other document and instrument further evidencing, guaranteeing and/or securing the Loan, in each case, as modified, amended, replaced, supplemented, substituted, restated and/or replaced from time to time.

<u>"Loan Proceeds</u>" means the proceeds of the Loan.

<u>"Long Term Debt</u>" of any Person means all Indebtedness of such Person for borrowed money or which has been incurred in connection with the acquisition of assets in each case having a final maturity of more than one year from the date of origin thereof (or which is renewable or extendible at the option of the obligor for a period or periods more than one year from the date of origin), but excluding all payments in respect thereof that are required to be made within one year from the date of any determination of Long Term Debt, whether or not the obligation to make such payments shall constitute a current liability of the obligor under GAAP.

<u>"Master Agreement</u>" shall mean any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement governing a Swap Transaction.

<u>"Material Adverse Effect</u>" shall mean with respect to any event, act, condition or occurrence of whatever nature (including any adverse determination in any litigation, arbitration or governmental investigation or proceeding), whether singly or in conjunction with any other event or events, act or acts, condition or conditions, occurrence or occurrences, whether or not related, a material adverse change in, or a material adverse effect upon any of (a) the financial condition, operations, business or properties of the Borrower and its Subsidiaries taken as a whole, (b) the rights and remedies of the Bank under any of the Loan Documents or any documents, instruments or agreements executed and/or delivered by any Person other than Borrower in conjunction with the Loan Documents, or the ability of the Borrower to perform its obligations under any of the Loan Documents, or (c) the legality, validity or enforceability of any of the Loan Documents or any documents, instruments or agreements executed and/or delivered by any Person other than Borrower in conjunction with the Loan Documents.

<u>"Maturity Date</u>" means (a) with respect to the Term Loan, the maturity date set forth in the Term Note, and (b) with respect to the Revolving Loan, the maturity date set forth in the Revolving Note.

<u>"Note</u>" or "<u>Notes</u>" means, collectively, whether one or more in number, in any combination, the Term Note and the Revolving Note.

<u>"Obligations</u>" means any and all indebtedness and other duties, obligations, debts and liabilities of every kind and description owing to Bank by the Borrower at any time, whether now existing or hereafter incurred, whether matured or unmatured, direct or indirect, secured or unsecured, original, extended or renewed, absolute or contingent; whether originally contracted with or acquired by Bank; whether contracted alone or jointly and/or severally with others; whether or not evidenced by negotiable instruments or other writings; including lines of credit and obligations with respect to letters of credit or any draft presented in connection therewith and all future advances of any and every nature and kind made by Bank; further including all overdrafts on deposits or accounts maintained by the Borrower with Bank and any electronic funds transfer and/or ACH credit in connection therewith; further including, without limitation, all indebtedness and obligations of the Borrower to Bank under any of the Loan Documents; further including, without limitation, all Swap Obligations and all other obligations of the Borrower under any Swap Agreement, and any modifications, amendments, renewals, extensions, substitutions or restatements of any of the above.

<u>"Other Indebtedness</u>" means any and all Indebtedness of any Person owing to lenders other than Bank.

<u>"Permitted Liens</u>" means the following:

(a) Liens for taxes, assessments or other governmental charges which are not yet due and payable or which are "Duly Contested" as defined below;

(b) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen and other similar Liens, in each case, incurred in the ordinary course of business for sums not yet due and payable or which are "Duly Contested" as defined below;

(c) Liens (other than any Liens imposed by ERISA) incurred or deposits made in the ordinary course of business (i) in connection with workers' compensation, unemployment insurance and other types of social security or retirement benefits, or (ii) to secure (or obtain letters of credit that secure) the performance of tenders, statutory obligations, surety bonds, appeal bonds, bids, leases (other than Capital Leases), performance bonds, purchase, construction or sales contracts and other similar obligations, in each case not incurred or made in connection with the borrowing of money, the obtaining of advances or credit for the payment of the deferred purchase price of property;

(d) any attachment or judgment Lien, unless the judgment it secures shall not, within 60 days after the entry thereof, have been discharged or execution thereof stayed pending appeal, or shall not have been discharged within 60 days after the expiration of any such stay;

(e) leases or subleases granted to others, easements, rights-of-way, restrictions and other similar charges or encumbrances, in each case incidental to, and not interfering with, the ordinary conduct of the business of the Guarantor or any of its Subsidiaries, provided that such Liens do not, in the aggregate, materially detract from the value of such property;

(f) Liens on property or assets of a Subsidiary of the Guarantor for the benefit of the Guarantor or another Subsidiary of the Guarantor;

(g) Liens existing on the date of this Agreement and that secure Indebtedness of the Guarantor or any of its Subsidiaries;

(h) any Lien created after the date hereof to secure all or any part of the purchase price, or to secure Indebtedness incurred or assumed to pay all or any part of the purchase price or cost of construction or improvement, of fixed assets useful and intended to be used in carrying on the business of the Guarantor or any of its Subsidiaries (including pursuant to a Capital Lease or a Synthetic Lease), but only if

(i) any such Lien extends solely to the item or items of such property (or improvement thereon) so acquired or constructed and, if required by the terms of the instrument originally creating such Lien, other property (or improvement thereon) which is an improvement to or is acquired for specific use in connection with such acquired or constructed property (or improvement thereon) or which is real property being improved by such acquired or constructed property (or improvement thereon),

(ii) the principal amount of the Indebtedness secured by any such Lien at no time exceeds an amount equal to 100% of the lesser of cost or fair market value as determined in good faith by the board of directors of the Guarantor) of such property (or improvement thereon) at the time of such acquisition or construction, and

(iii) any such Lien is created contemporaneously with or within the period ending 180 days after, the acquisition or construction of such property;

(i) any Lien existing on property of a Person immediately prior to its being consolidated with or merged into the Guarantor or any of its Subsidiaries, or any Lien existing on any property acquired by the Guarantor or any of its Subsidiaries at the time such property is so acquired (whether or not the Indebtedness secured thereby shall have been assumed), provided that (i) no such Lien shall have been created or assumed in contemplation of such consolidation or merger or such Person's becoming a Subsidiary of Guarantor or such acquisition of property, and (ii) each such Lien on property so acquired shall extend solely to the item or items of property so acquired and, if required by the terms of the instrument originally creating such Lien, other property which is an improvement to or is acquired for specific use in connection with such acquired property.

For purposes of the foregoing definition, "Duly Contested" means, with respect to taxes, assessments, other governmental charges, statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen and other similar Liens, that (i) the amount, applicability or validity of such item is contested by the Guarantor or its Subsidiary, as applicable, on a timely basis in good faith and in appropriate proceedings, and the Guarantor or its Subsidiary, as applicable, has established adequate reserves therefor in accordance with GAAP on the books of the Guarantor or its Subsidiary, as applicable, or (ii) the nonpayment of all such taxes, assessments, charges, levies and claims could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

<u>"Person</u>" means any natural person or any firm, corpora-tion, limited liability company, partnership or other organizational entity of any kind.

<u>"Priority Indebtedness</u>" means the sum, without duplication, of all Indebtedness of the Guarantor or any of its Subsidiaries secured by Liens other than Permitted Liens.

<u>"Restricted Payment</u>" means any dividend or other distribution (whether in cash, securities or other property) with respect to any capital stock or other Equity Interest of Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such capital stock or other Equity Interest or on account of any return of capital to Borrower's stockholders, partners or members (or the equivalent Person thereof).

<u>"Revolving Loan</u>" means the revolving line of credit to Borrower in the maximum principal amount of up to Twenty-Five Million and No/100 Dollars ($25,000,000.00) (subject to the maximum principal limitations set forth in **Section 2.02**), evidenced by the Revolving Note, on terms and conditions more particularly set forth herein and therein.

<u>"Revolving Note</u>" means that certain Promissory Note made by Borrower payable to the order of Bank in the original principal amount of the Revolving Loan, evidencing the indebtedness of the Revolving Loan, as modified, amended, renewed, restated or replaced from time to time.

<u>"Subsidiary</u>" of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise specified, all references herein to a "Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of Borrower.

<u>"Swap Agreement</u>" means any agreement, document, or instrument, including, without limitation, any Master Agreement or related confirmation, entered into by any party(ies) in connection with a Swap Transaction.

<u>"Swap Obligation</u>" means any obligation, liability, or indebtedness of Borrower to Bank arising in connection with a Swap Transaction, including, without limitation, any fee, charge, or netting of liabilities in connection with the early termination, adjustment, or settlement of any Swap Transaction.

<u>"Swap Termination Value</u>" means, in respect of any one or more Swap Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Agreements, (a) for any date on or after the date such Swap Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Agreements (which may include Lender or any Affiliate of Lender).

<u>"Swap Transaction</u>" means any of the following entered into between Bank and Borrower or between any counterparty and Bank for, or on behalf of, Borrower: (i) interest rate swap transaction, basis swap, forward rate transaction, commodity swap, forward commodity contract, commodity option, equity or equity index swap, equity or equity index option, bond or bond price or bond index swap or option, forward bond index transaction, interest rate option or swaption, foreign exchange transaction, interest rate cap transaction, interest rate floor transaction, interest rate collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option, spot contract, any similar transaction, or any other arrangement designed to alter the risks arising from fluctuation in currency values or interest rates, or any combination of any of the foregoing (including, without limitation, any option to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any Master Agreement; and (ii) any transaction of any kind, or any related confirmation, which is subject to, or governed by, any Master Agreement.

<u>"Synthetic Lease Obligation</u>" means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).

<u>"Term Loan</u>" means the non-revolving, multi-advance term loan to Borrower in the maximum principal amount of Ten Million and No/100 Dollars ($10,000,000.00), evidenced by the Term Note, on terms and conditions more particularly set forth herein and therein.

<u>"Term Note</u>" means that certain Promissory Note made by Borrower payable to the order of Bank in the original principal amount of the Term Loan, evidencing the indebtedness of the Term Loan, as modified, amended, renewed, restated or replaced from time to time.

<u>"Threshold Amount</u>" means $5,000,000.00.

1.02 <u>Rules of Construction</u>. For purposes of this Agreement and all other Loan Documents, unless otherwise specified herein or therein: (a) accounting terms shall be construed in accordance with generally accepted accounting principles consistently applied for the period or periods in question; (b) the term "including" means "including without limitation," and other forms of the verb "to include" have correlative meanings; (c) references to any person or entity includes such person's or entity's permitted successors; (d) in the computation of a period of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until" each means "to but excluding"; (e) the words "hereof", "herein" and "hereunder" and words of similar import refer to the document or instrument in which such word appears as a whole and not to any particular provision of such document or instrument; (f) the term "or" means "and/or"; (g) all references to Articles, Sections, Subsections, Paragraphs, Subparagraphs, Clauses, Subclauses, Exhibits, Schedules or Supplements (whether or not capitalized) shall refer to the corresponding article, section, subsection, paragraph, subparagraph, clause, subclause, exhibit, schedule or supplement contained in, or attached to, the document or instrument in which such reference appears, unless specific reference is made to the articles, sections, subsections, paragraphs, subparagraphs, clauses, subclauses, exhibits, schedules or supplements contained in, or attached to, another document or instrument; (h) captions and section or paragraph headings (including any table of contents) are provided solely for convenience of reference and shall not affect the meaning or interpretation of the document or instrument in which they appear; (i) any reference to this Agreement or any other Loan Document means such document or instrument as amended, renewed, substituted, restated, supplemented, replaced or otherwise modified from time to time; (j) whenever any matter is to be consented to, or satisfactory to, Bank, or is to be determined, calculated or approved by Bank, then, unless otherwise expressly set forth, such consent, satisfaction, determination, calculation or approval shall be in Bank's sole discretion, exercised in good faith and in a commercially reasonable manner (from the perspective of a secured lender), and shall be conclusive absent manifest error; (k) all references to attorney's fees shall be deemed to mean reasonable attorney's fees and all references to costs and expenses shall be deemed to mean actual costs and expenses incurred.

2. **<u>THE LOANS</u>**

2.01 <u>The Term Loan</u>. Bank has lent to Borrower a non-revolving, multi-advance term loan in an amount equal to but not in excess of the amount of the Term Loan, which amount shall be evidenced by the Term Note, subject to the terms and conditions of this Agreement. Prior to the date hereof, the Term Loan was issued in multiple advances of principal, but no further advances shall be made available under the Term Loan after the date hereof. Sums advanced under the Term Loan may not be reborrowed following repayment. The Term Loan shall mature on its Maturity Date.

2.02 <u>The Revolving Loan; Advances</u>. Bank agrees to lend to Borrower and Borrower has the right to borrow from Bank a revolving line of credit, which shall be evidenced by the Revolving Note, subject to the terms and conditions of this Agreement. Advances of principal under the Revolving Loan and Revolving Note and the maximum principal balance thereunder shall not exceed (a) $4,000,000.00 from the date hereof until and including June 30, 2023, (b) $13,000,000.00 from July 1, 2023 until and including September 30, 2023, (c) $22,000,000.00 from October 1, 2023 until and including November 30, 2023, and (d) $25,000,000.00 from December 1, 2023 until the Maturity Date. In the event that, at any time or for any reason, the outstanding principal balance of the Revolving Loan exceeds the foregoing amounts, Borrower shall promptly repay principal under the Revolving Loan in an amount sufficient to satisfy this **Section 2.02**. Sums advanced under the Revolving Loan may be reborrowed following repayment so long as no Event of Default shall have occurred which shall not have been cured within any applicable grace, notice or cure period set forth in this Agreement. The outstanding principal amount of the Revolving Loan at any time shall be the sum of all principal advances made by Bank thereunder, less the aggregate amount of principal payments made on the Revolving Note. The Revolving Loan shall mature on its Maturity Date.

2.03 <u>Method of Borrowing Under Revolving Loan</u>. So long as no Event of Default shall have occurred and shall be continuing, Borrower shall have the opportunity to (a) obtain advances under the Revolving Loan in the manner and to the extent contemplated by any sweep, treasury management, overdraft or similar products or services issued to Borrower by Bank, and/or (b) request advances under the Revolving Loan by telephone or in a writing delivered to Bank not later than 11:00 a.m. (Roanoke, Virginia time) on the date of the requested advance; provided, however, that (i) any telephone requests shall be confirmed in a writing not later than the Business Day following the disbursement of the requested advance, and (ii) Borrower and Bank may enter into one or more separate written agreements providing for such advances.

2.04 <u>Interest; Swap Transaction</u>. Interest on the Loans shall accrue on the daily outstanding principal balance of the Notes at the rate or rates set forth in such Notes, subject to (in the case of the Term Loan) the terms and provisions of the Swap Agreement. All obligations of Borrower in connection with any Swap Transactions including, without limitation, all amounts payable for termination of the Swap Agreements and settlement of all swap transactions, shall be deemed obligations of the Borrower for all purposes in connection with the Term Loan. Bank is expressly authorized to disclose confidential information concerning Borrower to its Swap Transaction service provider and/or facilitator, as the case may be, as well as prospective counterparties (and/or their respective professional advisors) in connection with any existing or proposed Swap Transaction. The occurrence of any default or event of default (however denominated) under any Loan Document (including, without limitation, any Swap Agreement) shall constitute an event of default under the Loans and all other Loan Documents (including, without limitation, any Swap Agreement).

2.05 <u>Unused Fee for Revolving Loan</u>. Beginning with the fiscal quarter ending July 1, 2023 and continuing quarterly thereafter, Borrower shall pay an unused fee quarterly in arrears equal to fifteen hundredths of one percent (0.15%) per annum on the average daily unused amount of the Revolving Loan (based upon the maximum principal amount available under the Revolving Loan pursuant to **Section 2.02**) for such quarterly period. This unused fee (a) shall be calculated on the basis of a year of 360 days for the actual number of days elapsed, and (b) may be debited from Borrower's deposit account held with Bank.

2.06 <u>Repayment</u>. The Loans shall be repaid in accordance with the terms of the Notes.

2.07 <u>Method of Payment</u>. All sums payable to Bank shall be paid in immediately available funds without offset or deduction. At Borrower's request, any and all payments may be automatically debited from a deposit account of Borrower, whether held with Bank or with any other financial institution. During the continuance of an Event of Default hereunder, Bank may, at Bank's sole discre-tion, charge against any account, or deposit of Borrower, all or any part of any amount due under the Note or the other Loan Documents.

2.08 <u>Prepayment</u>. Borrower may make prepayments of principal upon terms and conditions more particularly set forth in the Notes.

2.09 <u>Guaranty Agreement</u>. The full and timely repayment of the Loans and the performance by Borrower of each and every term and condition of the Loan Documents shall be jointly and severally, unconditionally and irrevocably guaranteed, in form and substance satisfactory to Bank, by the Guarantor according to the terms, provisions, and limitations, as applicable, of the Guaranty Agreement. Guarantor shall execute and deliver to Bank the Guaranty Agreement.

3. **<u>REPRESENTATIONS AND WARRANTIES OF BORROWER</u>**

Borrower, for itself only, represents and warrants to Bank as follows as of the date of this Agreement:

3.01 <u>Organization, Status and Authority</u>. Borrower is (i) a corporation, duly organized, validly existing and qualified to do business under the laws of the Commonwealth of Virginia, (ii) has the power, authority and legal right to carry on the business conducted by it and to engage in the transactions contemplated by the Loan Documents to which it is a party, and (iii) has taken all action necessary to authorize the execution and delivery of the Loan Documents to which it is a party and the performance of all of its obligations thereunder. Guarantor is (i) a corporation, duly organized, validly existing and qualified to do business under the laws of the Commonwealth of Virginia, (ii) has the power, authority and legal right to carry on the business conducted by it and to engage in the transactions contemplated by the Loan Documents to which it is a party, and (iii) has taken all action necessary to authorize the execution and delivery of the Loan Documents to which it is a party and the performance of all of its obligations thereunder.

3.02 <u>Structure</u>. The organizational structure, ownership and management structure and Subsidiaries of the Borrower and the Guarantor are as described on the attached **<u>Exhibit A</u>**.

3.03 <u>Valid Execution and Delivery of Loan Documents; Non-Contravention</u>. The Loan Documents (other than the Guaranty) have been duly executed and delivered by the Borrower and are the legal, valid and binding obligations the Borrower and are enforceable against the Borrower in accordance with their terms. Neither the execution and delivery of the Loan Documents to which the Borrower is a party nor the performance of its obligations will violate the Borrower's organizational documents, any agreement to which the Borrower is a party or by which it is bound or any applicable Legal Requirement.

3.05 <u>Financial Statements; No Adverse Changes</u>. All financial statements of the Borrower and the Guarantor heretofore delivered to Bank are true and correct in all respects, have been prepared in accordance with generally accepted accounting principles, accurately represent the financial condition of the Borrower and the Guarantor as of the date thereof, and no change has occurred in the financial condition of the Borrower and the Guarantor as reflected in such statements since the respective dates thereof which could reasonably be determined to have a Material Adverse Effect.

3.06 <u>No Defaults or Pending Actions</u>. Borrower is not in default (i) under any of the Loan Documents or any other agreement binding upon it, or (ii) with respect to any order, decree or demand of any court or governmental authority having jurisdiction over it or its properties, and there are no actions, suits or proceedings pending or threatened against the Borrower.

3.07 <u>Litigation</u>. There are no pending or, to the best of the Borrower's knowledge, threatened actions, suits, proceedings or investigations of a judicial, regulatory, or administrative nature, against the Borrower which, if adversely determined, could reasonably be deemed to have a Material Adverse Effect.

3.08 <u>Swap Transactions</u>. Borrower acknowledges and agrees that: (a) certain fees and charges may be due and payable under the Swap Agreement in the event that a Swap Transaction is terminated; (b) such Swap Agreement may have an effect on Borrower's payment obligations and amounts due under the Loan; and (c) the obligations contained in such Swap Agreement may not be separately stated in the Loan Documents.

4. **<u>AFFIRMATIVE COVENANTS OF BORROWER</u>**

Borrower, for itself only, covenants and agrees with Bank to comply with the following:

4.01 <u>Payment and Performance</u>. Pay, when and as due without offset or deduction, all sums due Bank during the term of the Loan, whether principal, interest, advancement, expense, escrow, or otherwise and perform as and when required all terms, covenants and conditions of this Agreement and all other Loan Documents to which it is a party.

4.02 <u>Books and Records</u>. Keep and maintain proper, complete and accurate books of account and financial and accounting records with respect to the Borrower and the Guarantor.

4.03 <u>Notice of Existence of Default</u>. (a) <u>Notice of Default</u>. Borrower shall furnish to Bank, promptly upon becoming aware of the existence of any condition or event which constitutes a default or an Event of Default under any of the Loan Documents or any event which, upon the giving of notice or lapse of time or both, will become a default or an Event of Default, written notice specifying the nature and period of existence thereof and the action which Borrower is taking or proposes to take with respect thereto. (b) <u>Other Notices</u>. Borrower shall promptly notify Bank in writing of (i) any change in its financial condition or its business which will have a Material Adverse Effect; (ii) any default under any material agreement, contract or other instrument to which it is a party or by which any of its properties are bound, or any acceleration of the maturity of any indebtedness owing by Borrower, but in each case only if in excess of the Threshold Amount; (iii) any claim against or affecting Borrower or any property of the Borrower which, if adversely determined, will have a Material Adverse Effect; (iv) the commencement of, and any material determination in, any litigation, suit or proceeding with any third party or any proceeding before any governmental agency or unit affecting the Borrower which, if adversely determined, will have a Material Adverse Effect; and (v) at least **thirty (30) days** prior thereto, any change in the name or address of the Borrower or the Guarantor, and/or any change in the structure of the Borrower or the Guarantor except for any changes to the membership of the Board of Directors of the Borrower and/or Guarantor.

4.04 <u>Maintenance of Existence</u>. Preserve and maintain Borrower's existence in good standing as a Virginia corporation.

4.05 <u>Legal Requirements; Environmental Compliance</u>. Comply in all material respects with Legal Requirements applicable to it or to its business or property, except in such instances in which (a) such Legal Requirements is being contested in good faith by appropriate proceedings diligently conducted; or (b) the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect. Such Legal Requirements shall specifically include environmental Legal Requirements. The Borrower shall periodically conduct, in the ordinary course of their business, reviews of the effect of existing environmental Legal Requirements, compliance with such Legal Requirements and claims alleging potential liability or responsibility for violation of any such environmental Legal Requirements on their respective businesses, operations and properties, and shall promptly disclose to Bank any and all breaches, violations or claims which could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

4.06 <u>Financial Information</u>. For so long as the Loan shall remain outstanding, the Borrower, at its expense, shall deliver, or cause to be delivered, to Bank:

(A) as soon as available but in no event more than **ninety (90) days** after the end of each fiscal year, a consolidated and consolidating balance sheet of Guarantor and its Subsidiaries as of the end of such year, and the related consolidated and consolidating statement of income, changes in shareholders' equity and cash flows of the Guarantor and its Subsidiaries for such year, setting forth in each case, in comparative form the figures for the previous year, all in reasonable detail, prepared in accordance with GAAP. Such consolidated statements to be audited and accompanied by a report and opinion of an independent certified public accountant and certified by a senior financial officer of Guarantor, accompanied by a covenant compliance and non-default certificate in the form attached hereto as **<u>Exhibit B</u>** (to include, upon request of Bank, financial covenant calculations and certification of compliance with all provisions of Other Indebtedness of Guarantor and its Subsidiaries).

(B) as soon as available but in no event more than **forty-five (45) days** after the end of each fiscal quarter, internally-prepared financial statements for Borrower for the most recent fiscal quarter then ended, in form and detail reasonably satisfactory to Bank, and certified by the chief financial officer or Treasurer of Borrower, together with (a) a compliance certificate signed by an authorized representative of Borrower, in the form attached hereto as **<u>Exhibit B</u>**, and (b) , upon request of Bank, copies of financial covenant calculations and certification of compliance with all provisions of Borrower's Other Indebtedness. Additionally, in the event that, for any reason, the Borrower ceases to be a wholly owned subsidiary of the Guarantor, Borrower shall provide financial statements of the character and for the dates and periods as required of the Guarantor in clauses (A) and (C) of this **Section 4.06**.

(C) as soon as available but in no event more than **forty-five (45) days** after the end of each fiscal quarter, a consolidated and consolidating balance sheet of Guarantor and its Subsidiaries as at the end of such quarter, and the related consolidated and consolidating statement of income, changes in shareholders' equity and cash flows of Guarantor and its Subsidiaries for such quarter, setting forth in each case, in comparative form the figures for the previous year, all in reasonable detail, prepared in accordance with GAAP and certified by the chief financial officer or Treasurer of each such entity, accompanied by a covenant compliance and non-default certificate, in the form attached hereto as **<u>Exhibit B</u>** (to include, upon request of Bank, financial covenant calculations and certification of compliance with all provisions of Other Indebtedness of Guarantor and its Subsidiaries).

(D) promptly after the same are available, copies of each annual report, proxy or financial statement or other report or communication sent to the stockholders of Guarantor, and copies of all annual, regular, periodic and special reports and registration statements which Guarantor may file or be required to file with the Securities and Exchange Commission under Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required to be delivered to Bank hereunder.

(E) promptly, and in any event within five (5) Business Days after receipt thereof by the Borrower or Guarantor, copies of each notice or other correspondence received from the Securities and Exchange Commission (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation or possible investigation by such agency.

(F) with reasonable promptness, copies of any amendments or modifications of any financial performance covenants set forth in the loan documents executed in connection with any of the Borrower's Other Indebtedness and, upon the request of Bank, copies of the loan documents governing the Borrower's Other Indebtedness.

Documents required to be delivered pursuant to **Sections 4.06(A), (B), (C), (D) or (E)** may, to the extent any such documents are included in materials otherwise filed with the Securities and Exchange Commission, be delivered electronically to Bank.

In addition, the Borrower shall furnish, or cause to be furnished, to Bank such other financial information regarding the Borrower and/or the Guarantor as Bank may from time to time request. The Borrower and the Guarantor will permit Bank, at any time or times, to visit their respective places of business and to inspect any of their assets and to inspect, audit, copy and make extracts from their books, records, journals, banking records, orders, receipts, minute books, correspondence, tax returns or other information pertaining to their affairs and will deliver to Bank such additional information regarding their financial condition and business of operation as Bank may require.

4.07 <u>Financial Covenants</u>. For so long as the Loan shall remain outstanding, the Borrower and Guarantor, as applicable, shall not at any time permit, suffer or allow the following:

(A) Borrower's Consolidated Long Term Debt, plus current maturities of Borrower's Consolidated Long Term Debt to exceed sixty-five percent (65%) of Borrower's Consolidated Total Capitalization; or

(B) Guarantor's Consolidated Long Term Debt, plus current maturities of Guarantor's Consolidated Long Term Debt to exceed sixty-five percent (65%) of Guarantor's Consolidated Total Capitalization; or

(C) Borrower's Priority Indebtedness to exceed fifteen percent (15%) of Borrower's Consolidated Total Assets; or

(D) Guarantor's Priority Indebtedness to exceed fifteen percent (15%) of Guarantor's Consolidated Total Assets; or

(E) Borrower's EBIT to Interest Ratio to be less than 1.50 to 1.00 (calculated on a rolling four-quarters basis); or

(F) Guarantor's EBIT to Interest Ratio to be less than 1.50 to 1.00 (calculated on a rolling four-quarters basis).

The financial covenants set forth in this section shall be tested quarterly based on the financial reports required pursuant to **Section 4.06** hereof.

4.08 <u>Payment of Debts</u>. The Borrower shall pay and discharge when due, and before subject to penalty or further charge, and otherwise satisfy before maturity or delinquency, all obligations, debts, taxes and liabilities exceeding the Threshold Amount, except those which the Borrower in good faith disputes and in each case subject to any applicable notice, cure and/or grace period.

4.09 <u>Taxes, Liens and Charges</u>. Pay all real and personal property taxes, charges, or assessments due and owing from the applicable jurisdictional authority before the same become delinquent, unless contested in good faith and for which adequate reserves shall have been established. Upon request, Bank shall be provided with evidence of the payment of any portion of the aforemen-tioned taxes, charges or assessments.

4.10 <u>Solvency Certifications</u>. Bank reserves the right to require Borrower to provide evidence satisfactory to Bank that (i) the financial condition of Borrower shall not have changed materially and adversely from that set forth in their most recent respective financial statements supplied to Bank and (ii) no bankruptcy, reorganization, arrangement, readjustment of debt or insolvency proceeding shall have been threatened or commenced by or against Borrower or consented to or acquiesced in by Borrower, nor shall any judgment in excess of the Threshold Amount have been entered against. Bank reserves the right to require, at any time and from time to time, updated financial statements relating to Borrower. The Borrower authorizes Bank to obtain a credit report on a semiannual basis.

4.11 <u>Entity Separateness</u>. Borrower has maintained and shall maintain, for the duration of the Loans, its separateness as an independent, special purpose business entity and shall adhere at all times to the Borrower's purpose set forth in its articles of incorporation. In doing so, in addition to the covenants set forth in **Sections 4.02, 4.04, 4.05, 4.10 and Sections 5.01 through 5.08** hereof, Borrower shall (a) comply with the provisions of Title 56 of the Code of Virginia (1950), as amended, to which Borrower is subject and with any regulations promulgated by the Virginia State Corporation Commission to which Borrower is subject, except to the extent Borrower may be diligently pursuing any remedial or corrective action recommended or required by any regulatory agency with oversight over Borrower, (b) comply with the formalities established by Borrower's articles of incorporation, bylaws, resolutions and other charter documents, (c) not commingle its funds or assets with those of any other person or entity, (d) remain solvent, maintain adequate capital in light of its contemplated business operations, (e) not fail to correct any known misunderstanding regarding the separate identity of the Borrower, and (f) maintain an arm's-length relationship with any person or entity controlled by or under common control with the Borrower. The Bank has entered into the Loans in conclusive reliance upon the undertakings described in this **Section 4.11**.

4.12 <u>Deposit Account and Treasury Services</u>. Within sixty (60) days after the date hereof, Borrower and Guarantor shall have established their operating accounts and treasury services with Bank and shall maintain such accounts and services during the life of the Loans. Additionally, Borrower and Guarantor may, but shall not be required to, utilize Bank for its retail lockbox services.

4. **<u>NEGATIVE COVENANTS OF BORROWER</u>**

Borrower covenants and agrees until the payment and discharge of the Obligations not to do, or to permit to be done, or allow to occur, any of the acts or happenings set forth below without the prior written authorization of Bank:

5.01 <u>Fundamental Changes</u>. Merge, dissolve, liquidate, consolidate with or into another Person, or dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person, except that, so long as no Default exists or would result therefrom:

(A) any Subsidiary may merge with (i) Borrower but only if the Borrower is the continuing or surviving Person or (ii) any one or more of Borrower's Subsidiaries but only if, when any wholly-owned Subsidiary is merging with another Subsidiary, a wholly-owned Subsidiary is the continuing or surviving Person; and

(B) any Subsidiary of Borrower may dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise) to Borrower or to another Subsidiary of Borrower but only if, when the transferor in such a transaction is a wholly-owned Subsidiary of Borrower, then the transferee must either be Borrower or a wholly-owned Subsidiary of Borrower.

5.02 <u>Dispositions</u>. Make any Disposition or enter into any agreement to make any Disposition, except:

(A) Dispositions of obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business;

(B) Dispositions of inventory in the ordinary course of business;

(C) Dispositions of equipment or real property to the extent that (i) such property is exchanged for credit against the purchase price of similar replacement property, or (ii) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property;

(D) Dispositions of property by any Subsidiary to Borrower or Guarantor or to a wholly-owned Subsidiary of Borrower or Guarantor; provided that if the transferor of such property is a Guarantor, the transferee thereof must either be Borrower or a Guarantor;

(E) Dispositions permitted by **Section 5.01**; and

(F) Dispositions of cash, cash equivalents and investment assets in the ordinary course of business.

5.03 <u>Restricted Payments</u>. Declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, or issue or sell any Equity Interests, except that, so long as no Default or Event of Default shall have occurred and be continuing at the time of any action described below or would result therefrom:

(A) each Subsidiary may make Restricted Payments to Borrower, Guarantor and any other Person that owns an Equity Interest in such Subsidiary, ratably according to their respective holdings of the type of Equity Interest in respect of which such Restricted Payment is being made;

(B) Borrower may declare and make dividend payments or other distributions to the Guarantor; and

(C) Borrower and each Subsidiary may purchase, redeem or otherwise acquire Equity Interests issued by it with the proceeds received from the substantially concurrent issue of new shares of its common stock or other common Equity Interests.

Notwithstanding the foregoing or any contrary provision set forth in this Agreement, dividends or distributions made for the purpose of directly or indirectly satisfying liabilities of Borrower's Affiliates shall be deemed to be Restricted Payments and shall be strictly prohibited.

5.04 <u>Change in Nature of Business</u>. Engage in any material line of business substantially different from those lines of business conducted by Borrower and its Subsidiaries on the date hereof or any business substantially related or incidental thereto.

5.05 <u>Transactions with Affiliates</u>. Enter into any transaction of any kind with any Affiliate of Borrower, whether or not in the ordinary course of business, other than on fair and reasonable terms substantially as favorable to Borrower as would be obtainable by Borrower at the time in a comparable arm's length transaction with a Person other than an Affiliate; provided, however, that this **Section 5.05** shall not apply to transactions between Borrower and Guarantor so long as any such transactions comply with **Sections 4.11 and 5.03** hereof.

5.06 <u>Use of Proceeds</u>. Use the proceeds of the Loan, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose.

5.07 <u>Assignment of this Loan Agreement</u>. Borrower shall not assign or attempt to assign this Agreement or any Loan Proceeds either directly or indirectly, and any attempted assignment shall be void.

5.08 <u>False Certificates or Documents</u>. The Borrower shall not knowingly furnish Bank with any certificate or other document that will contain any untrue statement of material fact or that will omit to state a material fact necessary to make it not misleading in light of the circumstances under which it was furnished.

6. **<u>CONDITIONS TO CLOSING</u>**

Bank shall not be obligated to close or disburse the Loan Proceeds until all of the following conditions have been satisfied by proper evidence, execution and/or delivery to Bank of the following items, all in form and substance satisfactory to Bank and Bank's counsel:

6.01 <u>Loan Documents</u>. The duly executed Loan Documents and any other documents, agreements or instruments related to the Loan.

6.02 <u>Attorney</u><u>'</u><u>s Opinion</u>. If requested, the written opinion of legal counsel to the Borrower and the Guarantor as approved by Bank.

6.03 <u>Organizational Documents</u>. (A) A copy of the Borrower's and the Guarantor's articles of incorporation and bylaws and all amendments thereto, certified by a duly authorized officer of Borrower, and a certificate of good standing issued by the Clerk of the Virginia State Corporation Commission; and (B) copies of a resolution, consent or action in writing of the directors or authorized board or committee of the Borrower and Guarantor authorizing the execution and delivery of the Loan Documents to which it is a party and the performance of its Obligations, certified by a duly authorized officer of the Borrower and the Guarantor, respectively.

6.04 <u>No Adverse Changes</u>. If required by Bank, evidence that no change has occurred in the financial condition of the Borrower from that indicated in the financial statements, applications and other information theretofore furnished to Bank which could reasonably be deemed to have a Material Adverse Effect.

6.05 <u>Miscellaneous</u>. Such other documents and items as Bank or its legal counsel may require.

7. **<u>EVENTS OF DEFAULT AND REMEDIES</u>**

7.01 <u>Events of Default</u>. Upon the occurrence of any of the following events (each of which is an "<u>Event of Default</u>") and following the expiration of any applicable grace, notice or cure periods set forth in this Agreement, (i) the Loan shall, at Bank's option, become immediately due and payable, and (ii) Bank may exercise any remedy available to it under the Loan Documents or otherwise:

(A) If Borrower shall fail to pay any Obligation after the date when due (whether by acceleration, at maturity or otherwise) if such failure continues for more than ten (10) days after written notice thereof to Borrower from Bank.

(B) If any material representation or warranty made by the Borrower contained in this Agreement or any statement or representation made in any certificate of Borrower, report of Borrower or opinion of Borrower delivered pursuant hereto or in connection with the Loan proves to be untrue or misleading in any material respect as of the time it is made or deemed to be made.

(C) If: (i) any covenant, financial or otherwise, set forth herein or in any other Loan Document shall be violated; (ii) the Borrower shall fail or refuse to timely pay or perform any of the terms, conditions, stipulations, agreements, or obligations contained in this Agreement or the other Loan Documents subject to Borrower's good faith dispute, or (iii) any "Event of Default" shall occur under the Note, the Guaranty Agreement or any other Loan Document, and, in each case, continues after any required notice and beyond the expiration of any applicable grace or cure period.

(D) Borrower shall no longer be a wholly owned subsidiary of Guarantor or one of Guarantor's other subsidiaries.

(E) If the Borrower shall make a general assignment for the benefit of its creditors.

(F) If a petition or complaint under any bankruptcy, insolvency or other law seeking reorganization, liquidation, disso-lution or seeking the composition, extension, arrangement or adjustment of any of the Borrower's obligations or other relief is filed: (i) against the Borrower and remains undismissed for a period of **sixty (60) days** or (ii) by the Borrower.

(G) If the Borrower becomes unable to pay, or admits its inability to pay, its debts as they become due.

(H) If the Borrower's business is discontinued as a going concern, or if there is a suspension of the Borrower's business.

(I) If possession or control of all or any substantial part of the Borrower's property or business shall be taken or assumed by any government or governmental agency or authority.

(L) If any foreclosure or forfeiture proceedings in an amount in excess of the Threshold Amount shall be commenced by any creditor or by any governmental agency against the Borrower, whether by judicial proceeding, self-help, repossession or any other method, including a garnishment of the Borrower's accounts; *provided, however*, if there is a good faith dispute by the Borrower as to the validity or reasonableness of the claim which is the basis of such proceeding and if the Borrower gives Bank written notice of such proceeding and deposits with Bank monies or a surety bond in an amount determined by Bank, in its sole discretion, as being an adequate reserve or bond for the dispute.

(M) (i) Borrower, Guarantor or any of Guarantor's Subsidiaries (a) fails to make any payment when due (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness or Guarantee (other than Indebtedness hereunder and Indebtedness under a Swap Agreement) having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than the Threshold Amount, or (b) fails to observe or perform any other agreement or condition relating to any such Indebtedness or Guarantee or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the effect of which default or other event is to cause, or to permit the holder or holders of such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such Indebtedness to be demanded or to become due or to be repurchased, prepaid, defeased or redeemed (automatically or otherwise), or an offer to repurchase, prepay, defease or redeem such Indebtedness to be made, prior to its stated maturity, or such Guarantee to become payable or cash collateral in respect thereof to be demanded; or (ii) there occurs under any Swap Agreement an Early Termination Date (as defined in such Swap Agreement) resulting from (a) any event of default under such Swap Agreement as to which Borrower, Guarantor or any of Guarantor's Subsidiaries is the Defaulting Party (as defined in such Swap Agreement) or (b) any Termination Event (as so defined) under such Swap Agreement as to which Borrower, Guarantor or any of Guarantor's Subsidiaries is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by Borrower, Guarantor or any of Guarantor's Subsidiaries as a result thereof is greater than the Threshold Amount.

(N) There is entered against Borrower, Guarantor or any of Guarantor's Subsidiaries (i) one or more final judgments or orders for the payment of money in an aggregate amount (as to all such judgments or orders) exceeding the Threshold Amount (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage), or (ii) any one or more non-monetary final judgments that have, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect and, in either case, (a) enforcement proceedings are commenced by any creditor upon such judgment or order, or (b) there is a period of ten (10) consecutive days during which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, is not in effect.

(O) If Guarantor terminates, revokes or disputes the validity of, or liability under, the Guaranty Agreement, or if the Guaranty Agreement shall be terminated.

Notwithstanding anything contained herein to the contrary, the Borrower shall have the right to cure for a period of **thirty (30) days** after the date on which Bank sends written notice of such Event of Default to Borrower expressly *excluding* (a) any Event of Default arising from the failure to make any regularly scheduled payment of principal or interest under the Loan, and (b) any Event of Default arising from **Sections 4.06 or 4.07** hereof. If such Event of Default is not reasonably capable of being cured within such thirty (30) day period, Borrower shall have additional time to cure such Event of Default so long as Borrower commences such cure within such thirty (30) day period and diligently pursues the completion of such cure; provided, however, that such cure must in all events be completed within **sixty (60) days** after the date described in the preceding clauses.

7.02 <u>Remedies</u>. Upon the occurrence of an Event of Default, Bank may take any one or more or all of the following actions:

(A) Declare the outstanding principal balance of the Note, plus accrued interest thereon and fees and costs, if any, to be immediately due and payable.

(B) Terminate this Agreement and all of Bank's obligations hereunder.

(C) Exercise all rights and remedies provided by applicable law, this Agreement, the other Loan Documents and any other document, agreement or instrument related to the Loan.

7.03 <u>Remedies Cumulative</u>. All remedies of Bank provided for herein, in any other Loan Document, or in any other document, agreement or instrument related to the Loan, are cumulative and shall be in addition to any and all other rights and remedies provided for or available under the Loan Documents or in any other document, agreement or instrument related to the Loan, or otherwise available at law or in equity.

7.04 <u>No Liability of Bank</u>. Whether or not Bank elects to employ any or all remedies available to it upon an Event of Default, Bank shall not be liable for the payment of any expense incurred in connection with the exercise of any remedy available to Bank or for the performance or nonperformance of any other obligation of Borrower.

8. **<u>GENERAL CONDITIONS</u>**

8.01 <u>No Waiver</u>. Closing of the Loan and disbursement of Loan Proceeds hereunder shall not constitute a waiver of any of the conditions of Bank's obligation to close the Loan nor, in the event Borrower is unable to satisfy any such condition subsequent to closing, shall any such waiver have the effect of precluding Bank from thereafter declaring such inability to be an Event of Default as hereinabove provided. Waivers of any covenants, terms or conditions contained herein must be in writing and shall not be construed as a waiver of any subsequent breach of the same covenant, term or condition. The approval by Bank of any act by Borrower shall not constitute a waiver of Bank's right to approve any subsequent or similar act.

8.02 <u>Indemnity</u>. Borrower covenants and agrees to indemnify and save harmless Bank, and the respective agents and employees of Bank and the trustees from and against all claims, damages, costs and expenses, including attorneys' fees, imposed upon, incurred by, or threatened against, Bank or its agents or employees with respect to the Loan, or any portion thereof, including, without limitation, all claims, damages, fines, penalties, costs and expenses arising out of or attributable to the use, manufacture, storage, disposal, treatment, generation, emission, discharge, release or presence of any chemical, material or substance which is prohibited, limited or regulated by any federal, state, county, regional or local authority, associated with the operation of the Borrower's business; provided, however, that nothing contained herein will require Borrower to indemnify Bank for any claim or liability resulting from Bank's gross negligence or willful and wrongful acts.

8.03 <u>Notices</u>. All notices, requests, demands and other communications with respect to this Agreement, any other Loan Document, or applicable law, shall be in writing and shall be delivered by hand, sent prepaid by Federal Express or UPS Next Day Air (or a comparable overnight delivery service) or sent by Untied States mail, certified, postage prepaid, return receipt requested, to the following addresses:

If to Borrower:

Roanoke Gas Company

519 Kimball Avenue NE

Roanoke, VA 24016

Attention: Treasurer

With a copy to:

Woods Rogers PLC

10 South Jefferson Street, Suite 1800

Roanoke, VA 24011

Attention: Michael J. Hertz, Esq.

If to Bank:

Pinnacle Bank

202 Campbell Avenue, S.E., 3<sup>rd</sup> Floor

Roanoke, VA 24013

Attention: Jonathan R. Richardson

With a copy to:

Williams Mullen

200 South 10<sup>th</sup> Street

Richmond, VA 23219

Attention: Matthew E. Cheek, Esq.

Notice by e-mail is not valid notice under this or any other agreement between the Borrower and Bank. Any notice, request, demand or other communication delivered or sent in the manner aforesaid shall be deemed given or made (as the case may be): (i) on the day which it is actually delivered or delivery is refused, (ii) on the **third (3<sup>rd</sup>) Business Day** after the day on which it is deposited in the United States mail, or (iii) on the **first (1<sup>ST</sup>) Business Day** after the day on which it is deposited with an overnight delivery service, whichever first occurs. Any party to this Agreement may change its address by notifying the other party(ies) hereto of the new address in any manner permitted by this **Section 8.03**.

8.04 <u>Successors and Assigns</u>. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their successors and permitted assigns; provided, however, Borrower shall not have the right to assign this Agreement without the prior written consent of Bank. Bank shall have the right, without the consent of or notice to the Borrower, to sell, assign, transfer, negotiate, or grant participation in all or any part of, or any interest in, Bank's obligations, rights and benefits hereunder, and to disclose such financial and other information regarding the Borrower and Guarantor which Bank may deem necessary in connection therewith. The Borrower shall execute, acknowledge and deliver any and all instruments reasonably requested by Bank in connection with the foregoing in form reasonably acceptable to the Borrower.

8.05 <u>Governing Law</u>. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the Commonwealth of Virginia.

8.06 <u>Savings Clause</u>. If any clause, provision or section of this Agreement shall be held illegal or invalid by any court, the illegality or invalidity of such clause, provision or section shall not affect the remainder of this Agreement, which shall be construed and enforced as if such illegal or invalid clause, provision or section had not been contained in this Agreement. If any agreement or obligation contained in this Agreement is held to be in violation of law, then such agreement or obligation shall be deemed to be the agreement or obligation of the Borrower and/or Bank, as the case may be, only to the extent permitted by law.

8.07 <u>No Partnership</u>. Nothing contained in this Agreement or in any of the other Loan Documents shall create a partnership or joint venture or principal-agent relationship between the Borrower or the Guarantor and Bank or cause Bank to be liable in any way for the debts or obligations of the Borrower or the Guarantor.

8.08. <u>Time of the Essence</u>. Time shall be of the essence with respect to the performance of the obligations hereunder and under the other Loan Documents.

8.09 <u>Assignment by Bank</u>. Bank may at any time sell, assign, grant participation in or otherwise transfer to any other person (each, a "<u>Participant</u>") all or part of the Loan, and each Participant shall have the rights and liens provided hereunder and under the other Loan Documents to the same extent as Bank.

8.10 <u>Captions</u>. The captions contained in this Agreement are inserted only as a matter of convenience and for reference and in no way define, limit or describe the scope of this Agreement nor the intent of any provision hereof.

8.11 <u>Counterparts</u>. This Agreement may be executed in any number of counterparts and by different parties to this Agreement on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same agreement.

8.12 <u>Costs</u>. The Borrower shall pay promptly, after receiving written demand therefor, the following costs and expenses: (a) all costs, fees and expenses of Bank (including, without limitation, attorneys' fees) incident to the closing of the Loan or thereafter incurred in connection with reviewing documents or advising Bank with respect to the Loan; (b) all costs of collection, including reasonable fees and expenses of counsel to Bank, incurred by Bank in connection with obtaining payment of the Note or any other Obligation or amount due under the Loan Documents; and (c) all costs and expenses (including, without limitation, attorneys' fees) incurred by Bank in connection with litigation arising from or involving the Loan.

9. **<u>CONSENT TO RELIEF FROM AUTOMATIC STAY</u>. Borrower agrees that Bank immediately shall be entitled to relief from any automatic stay imposed by Section 362 of Title 11 of the U.S. Code, as amended, or otherwise, on or against the exercise of the rights and remedies available to it under the Note and other Loan Documents evidencing Borrower**'**s indebtedness, in the event it shall: (a) file with any bankruptcy court of competent jurisdiction or be the subject of any petition under Title 11 of the U.S. Code, as amended; (b) be the subject of any order for relief issued under Title 11 of the U.S. Code, as amended; (c) file or be the subject of any petition seeking any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any present or future federal or state act or law relating to bankruptcy, insolvency or other relief for debtors; (d) have sought or consented to or acquiesced in the appointment of any trustee, receiver, conservator, or liquidator; or (e) be the subject of any order, judgment or decree entered by any court of competent jurisdiction approving a petition filed against such party for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any present or future federal or state act or law relating to bankruptcy, insolvency, or relief for debtors.**

10. **<u>WAIVER OF JURY TRIAL</u>**. AS PART OF THE CONSIDERATION FOR NEW VALUE THIS DAY RECEIVED, BORROWER AND BANK HEREBY CONSENT TO THE NONEXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT SITTING WITHIN THE COMMONWEALTH OF VIRGINIA FOR ANY ACTION TO WHICH BORROWER AND/OR GUARANTOR AND BANK ARE PARTIES ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE LOAN DOCUMENTS. TO THE EXTENT PERMITTED BY LAW, BORROWER AND BANK WAIVE TRIAL BY JURY AND WAIVES ANY OBJECTION WHICH BORROWER MAY HAVE BASED ON LACK OF JURISDICTION OR IMPROPER VENUE OR *FORUM NON CONVENIENS* TO THE CONDUCT OF ANY ACTION INSTITUTED HEREUNDER OR UNDER ANY OF THE LOAN DOCUMENTS, OR ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE LOAN DOCUMENTS, OR ANY OTHER PROCEEDING ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE LOAN DOCUMENTS TO WHICH BANK IS A PARTY, INCLUDING ANY ACTIONS BASED UPON, ARISING OUT OF OR IN CONNECTION WITH ANY COURSE OF CONDUCT, COURSE OF DEALING OR STATEMENT (WHETHER ORAL OR WRITTEN) OR ACTIONS OF BANK OR BORROWER OR GUARANTOR, AND BORROWER AND BANK CONSENT TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT. NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF BANK TO BRING ANY ACTION OR PROCEEDING AGAINST BORROWER OR GUARANTOR IN THE COURTS OF ANY OTHER JURISDICTION THAT HAS JURISDICTION OVER BORROWER OR GUARANTOR.

11. <u>Patriot Act Notice</u>. To help fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. For purposes of this section, account shall be understood to include loan accounts.

[SIGNATURE PAGES FOLLOW]

------

**AMENDED AND RESTATED LOAN AGREEMENT**

[SIGNATURE PAGE]

WITNESS the following signatures and seals as of the date first set forth above:

**BORROWER:**

ROANOKE GAS COMPANY, a Virginia corporation

By: <u>/s/ Paul W. Nester</u> (SEAL)

Paul W. Nester,

President and CEO

and

By: <u>/s/ Jason A. Field</u> (SEAL)

Jason A. Field,

Vice President, CFO and Treasurer

------

**AMENDED AND RESTATED LOAN AGREEMENT**

[SIGNATURE PAGE]

WITNESS the following signatures and seals as of the date first set forth above:

**BANK:**

PINNACLE BANK

By: <u>/s/ Jonathan R. Richardson</u> (SEAL)

Name: Jonathan R. Richardson

Title: Senior Vice President

------

**EXHIBIT A**

**TO AMENDED AND RESTATED LOAN AGREEMENT** 

<u>Current Ownership, Management and Subsidiary Structure of Borrower and Guarantor</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) **ROANOKE GAS COMPANY**, a Virginia corporation

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. **Owner**:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. RGC Resources, Inc. - 100%

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. **Management**:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Board of Directors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Nancy Howell Agee

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Jacqueline L. Archer

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Thomas J. Crawford

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Maryellen F. Goodlatte

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Robert B. Johnston

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. J. Allen Laymen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. Paul W. Nester

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. John B. Williamson, III

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. **Subsidiaries**:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. None

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) **RGC RESOURCES, INC.**, a Virginia corporation

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. **Owner**:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Publicly traded

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. **Management**:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Board of Directors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Nancy Howell Agee

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Jacqueline L. Archer

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Abney S. Boxley, III

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Thomas J. Crawford

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Maryellen F. Goodlatte

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Robert B. Johnston

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. J. Allen Laymen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. Elizabeth A. McClanahan

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. Paul W. Nester

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. John B. Williamson, III

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. **Subsidiaries**:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Roanoke Gas Company

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. RGC Midstream, L.L.C.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. Diversified Energy Company

------

**EXHIBIT B**

**TO AMENDED AND RESTATED LOAN AGREEMENT** 

**FORM OF COMPLIANCE CERTIFICATE**

Financial Statement Date: ___________,

To: Pinnacle Bank

Ladies and Gentlemen:

Reference is made to that certain Amended and Restated Loan Agreement, dated as of March ___, 2023 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the "Agreement;" the terms defined therein being used herein as therein defined), between the undersigned ("Borrower"), and Pinnacle Bank, as lender.

The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is the ___________________________ of Borrower, and that, as such, he/she is authorized to execute and deliver this Certificate to Lender on the behalf of Borrower, and that:

*[Use following paragraph 1 for fiscal year-end financial statements]*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Borrower has delivered the year-end audited financial statements required by Section 4.06 of the Agreement for the fiscal year ended as of the above date, together with the report and opinion of an independent certified public accountant required by such section.

*[Use following paragraph 1 for fiscal quarter-end financial statements]*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Borrower has delivered the unaudited financial statements required by Section 4.06 of the Agreement for the fiscal quarter ended as of the above date. Such financial statements fairly present the financial condition, results of operations and cash flows of Guarantor and its Subsidiaries and of Borrower in accordance with GAAP as at such date and for the period then ended, subject only to normal year-end audit adjustments and the absence of footnotes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The undersigned has reviewed and is familiar with the terms of the Agreement and has made, or has caused to be made under his/her supervision, a detailed review of the transactions and condition (financial or otherwise) of Guarantor and Borrower during the accounting period covered by such financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. A review of the activities of Borrower during such fiscal period has been made by or under the supervision of the undersigned with a view to determining whether during such fiscal period Borrower performed and observed all its Obligations under the Loan Documents, and

***[select one:]***

**[to the best knowledge of the undersigned during such fiscal period, Borrower performed and observed each covenant and condition of the Loan Documents applicable to it, and no Default has occurred and is continuing.]**

***--or--***

**[to the best knowledge of the undersigned, during such fiscal period, the following covenants or conditions have not been performed or observed and the following is a list of each such Default and its nature and status:]**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The representations and warranties of Borrower contained in Article 3 of the Agreement, and/or any representations and warranties of Borrower that are contained in any document furnished at any time under or in connection with the Loan Documents, are true and correct in all material respects on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for purposes of this Compliance Certificate, the representations and warranties contained in <u>Section 3.05</u> of the Agreement shall be deemed to refer to the most recent statements furnished pursuant to <u>Subsections 4.06(A) and (B)</u> of the Agreement, including the statements in connection with which this Compliance Certificate is delivered.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The financial covenant analyses and information set forth on Schedule 1 attached hereto are true and accurate on and as of the date of this Certificate.

*IN WITNESS WHEREOF*, the undersigned has executed this Certificate as of _____________, 20___.

ROANOKE GAS COMPANY, a Virginia corporation

By: _________________________________

Name: _________________________________

Title: _________________________________

------

For the Quarter/Year ended ___________________ ("<u>Statement Date</u>")

**SCHEDULE 1**

to the Compliance Certificate

**Section 4.07 <u>Financial Covenants</u>**

**(a) Limitation on Long Term Debt: The ratio of long-term debt to total capitalization cannot exceed 65%.**

---

| | | |
|:---|:---|:---|
|  | Borrower (Consolidated with Subsidiaries) |  |
| Long Term Debt – Notes Payable |  |  |
| Long Term Debt – Line of Credit |  |  |
| Current Maturities of Long Term Debt |  |  |
| Long Term Debt Plus Current Maturities |  | (a),(1) |
| Total Shareholders' Equity |  | (b),(2) |
| Total Capitalization (a) + (b) |  | (3) |
| Consolidated Ratio = (1) / (3): Hurdle < 65% |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;(Show calculation) | PASS/FAIL |  |

---

---

| | | |
|:---|:---|:---|
|  | Guarantor (Consolidated with Subsidiaries) |  |
| Long Term Debt – Notes Payable |  |  |
| Long Term Debt – Line of Credit |  |  |
| Current Maturities of Long Term Debt |  |  |
| Long Term Debt Plus Current Maturities |  | (a),(1) |
| Total Shareholders' Equity |  | (b),(2) |
| Total Capitalization (a) + (b) |  | (3) |
| Consolidated Ratio = (1) / (3): Hurdle < 65% |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;(Show calculation) | PASS/FAIL |  |

---

------

**(b) Limitation on Priority Indebtedness: < 15%**

---

| | | |
|:---|:---|:---|
|  | Borrower (Consolidated with Subsidiaries) |  |
| Priority or Secured Indebtedness |  | (4) |
| Total Assets |  | (5) |
| Consolidated Ratio = (4) / (5): Hurdle < 15% |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;(Show calculation) | PASS/FAIL |  |
|  | Guarantor (Consolidated with Subsidiaries) |  |
| Priority or Secured Indebtedness |  | (4) |
| Total Assets |  | (5) |
| Consolidated Ratio = (4) / (5): Hurdle < 15% |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;(Show calculation) | PASS/FAIL |  |

---

------

**(c) EBIT to Interest Ratio: > 1.50 to 1.00**

---

| | | |
|:---|:---|:---|
|  | Borrower (Consolidated with Subsidiaries) |  |
| Earnings before Interest and Taxes |  | (6) |
| Interest Expense |  | (7) |
| Ratio = (6) / (7): Hurdle > 1.50 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;(Show calculation) | PASS/FAIL |  |
|  | Guarantor (Consolidated with Subsidiaries) |  |
| Earnings before Interest and Taxes |  | (6) |
| Interest Expense |  | (7) |
| Ratio = (6) / (7): Hurdle > 1.50 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;(Show calculation) | PASS/FAIL |  |

---

## Exhibit 10.4

**Exhibit 10.4**

**AMENDED AND RESTATED GUARANTY AGREEMENT**

**THIS AMENDED AND RESTATED GUARANTY AGREEMENT HEREBY AMENDS AND RESTATES THAT CERTAIN GUARANTY AGREEMENT EXECUTED BY GUARANTOR FOR THE BENEFIT OF BANK DATED AS OF SEPTEMBER 24, 2021, AS THE SAME MAY HAVE BEEN MODIFIED OR AMENDED FROM TIME TO TIME. NO NOVATION IS INTENDED HEREBY.**

**THIS AMENDED AND RESTATED GUARANTY AGREEMENT** (this "<u>Guaranty</u>") is made as of March 24, 2023, by **RGC RESOURCES, INC.**, a Virginia corporation ("<u>Guarantor</u>"), to and for the benefit of **PINNACLE BANK** ("<u>Bank</u>"), and its successors and assigns.

WHEREAS, pursuant to that certain Amended and Restated Loan Agreement of even date herewith by and among ROANOKE GAS COMPANY, a Virginia corporation (the "<u>Borrower</u>"), Guarantor and Bank (as modified, amended or supplemented from time to time, the "<u>Loan Agreement</u>"), Bank has extended credit to Borrower (the "<u>Loan</u>"), as evidenced by the Note (as such term is defined in the Loan Agreement). The Note, the Loan Agreement, this Guaranty, any agreements executed in connection with any Swap Obligations (as such term is defined in the Loan Agreement) and any and all other documents, whether now or hereafter executed, evidencing, guaranteeing or securing the Loan or given by Borrower in connection with the Obligations (as hereinafter defined), as modified, amended or supplemented from time to time, are referred to collectively as the "<u>Financing Documents</u>". As a condition to making the Loan, Bank has required that Guarantor execute and deliver this Guaranty.

NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor agrees as follows:

Section 1. **Interpretation; Definitions.** Unless the context indicates otherwise, words used in this Guaranty in the singular number shall be deemed to include words in the plural number, and vice versa, and words in one gender shall be deemed to include words in the other genders. The section headings are for convenience only and neither limit nor amplify the provisions of this Guaranty. As used herein, the term "<u>Obligations</u>" shall mean, collectively, each and all of the duties, obligations, debts and liabilities of every kind and description owing by Borrower to Bank, whether now existing or hereafter incurred, whether matured or unmatured, direct or indirect, secured or unsecured, original, extended or renewed, absolute or contingent, whether originally contracted with or acquired by Bank, whether contracted alone or jointly and/or severally with others, whether or not evidenced by negotiable instruments or other writings and any renewals, extensions, or substitutions thereto, including open lines of credit and obligations with respect to letters of credit or any draft presented in connection therewith, and specifically including the duty of Borrower (i) to pay all sums when due under the Note, and any renewals, extensions, modifications or substitutions thereto, (ii) to pay all other sums due under the Financing Documents, including any advances made by Bank, and (iii) to perform and comply with all of the other obligations, terms and conditions contained in the Financing Documents; provided, however, that if and only if Guarantor is not an "eligible contract participant" (as defined in the Commodity Exchange Act and any applicable rules, as amended), then to the extent applicable law prohibits Guarantor from entering into an agreement to guaranty any obligations in respect of a "swap" (as defined in the Commodity Exchange Act and any applicable rules, as amended, and referred to herein as a "<u>Swap</u>"), the term "Obligations" shall not include obligations of Borrower to Bank under any Swap. The term "<u>Obligors</u>" shall mean any one or more of Borrower, Guarantor, and any co-maker, endorser with recourse, guarantor, surety or other party obligated to pay any sum pursuant to the provisions of, or to perform any act in order to comply with the provisions of, the Financing Documents.

Section 2. **Guaranty.** Guarantor hereby jointly, severally and unconditionally guarantees to Bank (i) the full and prompt payment when due (whether at maturity, by acceleration or otherwise) of all the Obligations; and (ii) the full and prompt performance by Borrower of its other Obligations to Bank. This is a guaranty of payment and performance and not merely of collection. If an Event of Default (as defined in the Financing Documents) shall occur in the payment of the principal of or interest on the Note, or if an Event of Default shall occur in the performance of any of the other Obligations, and any applicable grace, notice and cure periods have expired, Guarantor, upon demand of Bank, shall promptly pay to Bank any amount due to Bank or perform the obligation which is in default, and Bank shall not be required to proceed against Borrower or any collateral for the Loan before enforcing this Guaranty against Guarantor. Guarantor further agrees to pay all costs, including court costs and reasonable attorneys' fees, paid or incurred by Bank in collecting any amount due to Bank or in performing any defaulted Obligation. Each failure on the part of an Obligor to make a payment or perform any other Obligation shall give rise to a separate cause of action hereunder.

Section 3. **Guaranty Unconditional.** The obligations of Guarantor hereunder shall be absolute, continuing and unconditional and, without limiting the generality of the foregoing, shall not be released, discharged or otherwise affected by:

(i) any extension, renewal, compromise, settlement, substitution, exchange, waiver or release of any of the obligations of any other Obligor under any of the Financing Documents;

(ii) any amendment, modification or supplement to the Note, this Guaranty or any other Loan Document;

(iii) any failure to perfect a lien, if any, granted by any of the Financing Documents with respect to any collateral for the Loan, the release in whole or in part of any such lien or the release, substitution or exchange of any collateral for the Loan;

(iv) any change in the structure, existence or ownership of Borrower, or the filing or entry of a final order in any insolvency, bankruptcy, reorganization or other similar proceeding affecting Borrower or its assets or releasing any Obligor from any of its obligations under any of the Financing Documents;

(v) the existence of any claim, set-off or other right which Guarantor may have at any time against Borrower, Bank or any other Obligor, whether arising from the execution of any of the Financing Documents or otherwise, provided that nothing contained herein shall prevent the assertion of such a claim in a separate suit;

(vi) the unenforceability, for any reason, of any of the obligations of any other Obligor under any of the Financing Documents;

(vii) the failure of Bank (A) to file or enforce a claim against any other Obligor (or its estate in a bankruptcy or other proceeding), (B) to give notice of the creation or incurrence by any other Obligor of any new or additional indebtedness or obligation under the Financing Documents, (C) to commence any action against any Obligor, or (D) to proceed with due diligence to collect any amount due to it under any of the Financing Documents or to realize upon any collateral for the Loan; or

(viii) any other act, failure to act or delay of any kind by Borrower, any other Obligor or Bank which might, but for the provisions of this Section 3, constitute a legal or equitable discharge of Guarantor's obligations hereunder.

Section 4. **Joint and Several Obligations.** The obligations of Guarantor hereunder are joint and several and independent of the obligations of Borrower and/or any other Obligor, and a separate action or actions may be brought and prosecuted against Guarantor whether action is brought against Borrower and/or any other Obligor, or whether Borrower and/or any other Obligor is joined in any such action or actions.

Section 5. **Discharge; Reinstatement in Certain Circumstances.** This Guaranty shall remain in full force and effect until the principal and interest of the Note and all of the other Obligations shall have been paid or performed in full. If at any time any payment or performance by Borrower under any of the Financing Documents is rescinded or is required to be restored or returned because of insolvency, bankruptcy, reorganization or otherwise, Guarantor's obligations hereunder with respect to such payment or performance shall be reinstated as though such payment had been due or performance required, but not paid or performed, at the time of such rescission or requirement. Guarantor agrees that payment or performance of any of the Obligations or other acts which toll any statute of limitations applicable to the obligations shall also toll the statute of limitations applicable to Guarantor's liability hereunder.

Section 6. **Waiver of Subrogation.** Guarantor hereby waives and agrees not to assert any rights it may have now or in the future to be subrogated to any of Bank's rights and remedies under the Note or the other Financing Documents or any right to indemnification, contribution or reimbursement that it may have against Borrower until all the Obligations have been paid in full and no petition in bankruptcy has been filed by or against Borrower.

Section 7. **Stay of Acceleration.** If acceleration of the time for payment of any amount payable by Borrower pursuant to the Financing Documents is stayed upon insolvency or bankruptcy, such amount and all other amounts subject to acceleration under the terms of the Financing Documents shall, nevertheless, be payable by Guarantor on demand by Bank.

Section 8. **Rights of Bank Not Impaired.** No act or omission of any kind or at any time upon the part of Bank in respect of any matter whatsoever shall in any way affect or impair the rights of Bank to enforce any right, power or benefit of Bank under this Guaranty, and no set-off, claim, diminution of any Obligation or defense of any kind or nature which Guarantor has or may have against Bank shall be available against Bank in any suit or action brought by Bank to enforce any of its rights under this Guaranty. Nothing in this Guaranty shall be construed as a waiver by Guarantor of any rights or claims it may have against Bank under this Guaranty or otherwise, but any recovery upon such rights and claims shall be had from Bank separately, it being the intent of this Guaranty that Guarantor shall be unconditionally and absolutely obligated to perform fully all of its obligations hereunder for the benefit of Bank.

Section 9. **Payments to Guarantor Following Obligor Dissolution.** Upon any dissolution, winding-up, liquidation or reorganization of any Obligor, any payment or distribution of assets of any kind or character, whether in cash, property or securities, to which Guarantor would be entitled shall be paid or delivered directly to Bank to be applied to the payment of the Obligations before any payment or distribution is made to Guarantor. If, notwithstanding the foregoing, Guarantor shall receive any payment or distribution of assets of an Obligor to which it is not entitled under the provisions of this Section 9, Guarantor will hold such payment in trust for the benefit of Bank and will forthwith turn such payment over to Bank to be applied to the payment of the Obligations.

Section 10. **Representations of Guarantor.** Guarantor hereby represents and warrants the following to Bank:

(i) It has full power and authority to execute and deliver this Guaranty and to perform its obligations hereunder.

(ii) Neither the execution and delivery of this Guaranty nor the performance of its obligations hereunder will violate any agreement to which it is a party or by which it is bound or any laws or other orders or decrees of governmental authorities and courts having jurisdiction over Guarantor.

(iii) To the best of Guarantor's knowledge, no material adverse change has occurred in its financial condition from that indicated in the financial statements, applications and other information it has heretofore furnished to Bank.

(iv) It has duly executed and delivered this Guaranty, and this Guaranty constitutes its valid and binding obligation.

(v) There are no pending or, to the best of its knowledge, threatened actions, suits, proceedings or investigations of a legal, equitable, regulatory, administrative or legislative nature, the resolution of which could have a material adverse effect on its business, assets or condition (financial or otherwise) or its ability to perform its obligations under this Guaranty.

Section 11. **Financial Statements; Banking Relationship**. During the term of the Loan, Guarantor shall deliver to Bank the financial and other information required to be furnished pursuant to the terms of the Loan Agreement, and shall also furnish to Bank such other financial information as Bank may from time to time reasonably request.

Section 12. **Subsequent or Previous Guaranty.** A subsequent guaranty by Guarantor shall not be deemed to be in lieu of or to supersede or terminate this Guaranty but shall be construed as an additional or supplementary guaranty unless otherwise expressly provided therein; and in the event that Guarantor has given Bank a previous guaranty or guaranties, this Guaranty shall be construed to be an additional or supplemental guaranty, and not in lieu thereof or terminate such previous guaranty or guaranties unless expressly so provided herein or therein.

Section 13. **Venue.** Guarantor agrees that any suit, action or proceeding arising out of or relating to this Guaranty may be instituted in any State or Federal court located in the Commonwealth of Virginia (assuming such court has proper jurisdiction), and Guarantor hereby waives any objection which it may have to such venue and irrevocably submits to the jurisdiction of any such court in any such suit, action or proceeding. Nothing herein shall affect the right of Bank to proceed against Guarantor in any other jurisdiction.

Section 14. **Successors and Assigns.** This Guaranty shall inure to the benefit of and be binding on the parties hereto and their respective heirs, legal and personal representatives, successors and assigns.

Section 15. **Severability.** If any provision of this Guaranty or the application thereof in any circumstance is held to be unenforceable, the remainder of this Guaranty shall not be affected thereby and shall remain enforceable and in full force and effect.

Section 16. **Applicable Law.** This Guaranty shall be governed by the laws of the Commonwealth of Virginia.

Section 17. **Notices, Demands and Requests.** All notices, demands, requests and other communications required or permitted hereunder shall be in writing and shall be given in accordance with the term of the Loan Agreement.

Section 18. **Waiver.** Guarantor hereby waives, to the extent permitted by law, (i) the benefits of Sections 49-25 and 49-26 of the Code of Virginia (1950), as amended, and any amendments thereto or any similar statutes or rules of law, (ii) the benefit of any homestead or similar exemption, state or federal, with respect to their obligations hereunder, (iii) notice of any of the matters referred to in Section 3 of this Guaranty, (iv) presentment, demand, protest and notice of dishonor, and (v) except for notices as provided for in any of the Financing Documents, any demand (except as expressly specified herein), proof or notice of nonpayment, or failure to comply with, any of the Obligations.

Section 19. **Amendments.** This Guaranty may only be amended, modified, supplemented or terminated in writing, signed by all of the parties hereto.

Section 20. **Entire Agreement.** This Guaranty expresses the entire understanding and all agreements between the parties.

[SIGNATURE PAGE FOLLOWS]

------

**AMENDED AND RESTATED GUARANTY AGREEMENT**

[SIGNATURE PAGE]

IN WITNESS WHEREOF, Guarantor has duly executed this Guaranty Agreement under seal as of the day and year first written above.

**GUARANTOR:**

RGC RESOURCES, INC., a Virginia corporation

By: <u>/s/ Paul W. Nester</u> (SEAL)

Paul W. Nester,

President and CEO

and

By: <u>/s/ Jason A. Field</u> (SEAL)

Jason A. Field,

Vice President, CFO and Treasurer