Document:

Exhibit 10.2

 Exhibit 10.2 
 UNCONDITIONAL GUARANTY 
 March 23, 2009 
 Roanoke Gas Company 
 519 Kimball Avenue 
 Roanoke, Virginia 24016 
 (Hereinafter referred to as “Borrower”)

 RGC Resources, Inc. 
 519 Kimball Avenue Northeast

 Roanoke, Virginia 24030 
 (Hereinafter referred to as
“Guarantor”) 
 Wachovia Bank, National Association 
 Roanoke, Virginia 24019 
 (Hereinafter referred to as “Bank”) 
 IMPORTANT NOTICE 
 THIS INSTRUMENT CONTAINS A CONFESSION OF JUDGMENT PROVISION WHICH
CONSTITUTES A WAIVER OF IMPORTANT RIGHTS YOU MAY HAVE AS GUARANTOR AND ALLOWS THE CREDITOR TO OBTAIN A JUDGMENT AGAINST YOU WITHOUT ANY FURTHER NOTICE. 
 This Guaranty Agreement amends and restates all existing Guaranty Agreements executed by Borrower. 
 To induce Bank to make, extend or renew loans,
advances, credit, or other financial accommodations to or for the benefit of Borrower, which are and will be to the direct interest and advantage of the Guarantor, and in consideration of loans, advances, credit, or other financial accommodations
made, extended or renewed to or for the benefit of Borrower, which are and will be to the direct interest and advantage of the Guarantor, Guarantor hereby absolutely, irrevocably and unconditionally guarantees to Bank and its successors, assigns and
affiliates the timely payment and performance of all liabilities and obligations of Borrower to Bank and its affiliates, including, but not limited to, all obligations under any notes, loan agreements, security agreements, letters of credit,
instruments, accounts receivable, contracts, drafts, leases, chattel paper, indemnities, acceptances, repurchase agreements, overdrafts, and the Loan Documents, as defined below, and all obligations of Borrower to Bank or any of its affiliates under
any swap agreement (as defined in 11 U.S.C. § 101, as in effect from time to time), however and whenever incurred or evidenced, whether primary, secondary, direct, indirect, absolute, contingent, due or to become due, now existing or hereafter
contracted or acquired, and all modifications, extensions and renewals thereof, (collectively, the “Guaranteed Obligations”). 
 Guarantor further
covenants and agrees: 
 GUARANTOR’S LIABILITY. This Guaranty is a continuing and unconditional guaranty of payment and performance and not of
collection. The parties to this Guaranty are jointly and severally obligated together with all other parties obligated for the Guaranteed Obligations. This Guaranty does not impose any obligation on Bank to extend or continue to extend credit or
otherwise deal with Borrower at any subsequent time. This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any payment of the Guaranteed Obligations is rescinded, avoided or for any other reason must

 
be returned by Bank, and the returned payment shall remain payable as part of the Guaranteed Obligations, all as though such payment had not been made. The
obligations guaranteed hereby shall be in addition to any other obligations guaranteed by Guarantor pursuant to any other agreement of guaranty given to Bank and other guaranties of the Guaranteed Obligations. 
 TERMINATION OF GUARANTY. Guarantor may terminate this Guaranty only by written notice, delivered personally to or received by certified or registered United
States Mail by an authorized officer of Bank at the address for notices provided herein. Such termination shall be effective only with respect to Guaranteed Obligations arising more than 15 days after the date such written notice is received by said
Bank officer. Such termination shall not be effective with respect to Guaranteed Obligations (including any subsequent extensions, modifications or compromises of the Guaranteed Obligations) then existing, or Guaranteed Obligations arising
subsequent to receipt by Bank of said notice if such Guaranteed Obligations are a result of Bank’s obligation to make advances pursuant to a commitment, or are based on Borrower’s obligations to make payments pursuant to any swap agreement
(as defined in 11 U.S.C. § 101, as in effect from time to time), entered into prior to expiration of the 15 day notice period, or are a result of advances which are necessary for Bank to protect its collateral or otherwise preserve its
interests. Termination of this Guaranty by any single Guarantor will not affect the existing and continuing obligations of any other Guarantor hereunder. 
 CONSENT TO MODIFICATIONS. Guarantor consents and agrees that Bank (and, with respect to swap obligations, its affiliates) may from time to time, in its sole discretion, without affecting, impairing, lessening or releasing the obligations
of Guarantor hereunder: (a) extend or modify the time, manner, place or terms of payment or performance and/or otherwise change or modify the credit terms of the Guaranteed Obligations; (b) increase, renew, or enter into a novation of
the Guaranteed Obligations; (c) waive or consent to the departure from terms of the Guaranteed Obligations; (d) permit any change in the business or other dealings and relations of Borrower or any other guarantor with Bank;
(e) proceed against, exchange, release, realize upon, or otherwise deal with in any manner any collateral that is or may be held by Bank in connection with the Guaranteed Obligations or any liabilities or obligations of Guarantor; and
(f) proceed against, settle, release, or compromise with Borrower, any insurance carrier, or any other person or entity liable as to any part of the Guaranteed Obligations, and/or subordinate the payment of any part of the Guaranteed
Obligations to the payment of any other obligations, which may at any time be due or owing to Bank; all in such manner and upon such terms as Bank may deem appropriate, and without notice to or further consent from Guarantor. No invalidity,
irregularity, discharge or unenforceability of, or action or omission by Bank relating to any part of the Guaranteed Obligations or any security therefor shall affect or impair this Guaranty. 
 WAIVERS AND ACKNOWLEDGMENTS. Guarantor waives and releases the following rights, demands, and defenses Guarantor may have with respect to Bank (and, with
respect to swap obligations, its affiliates) and collection of the Guaranteed Obligations: (a) promptness and diligence in collection of any of the Guaranteed Obligations from Borrower or any other person liable thereon, and in foreclosure of
any security interest and sale of any property serving as collateral for the Guaranteed Obligations; (b) any law or statute that requires that Bank (and, with respect to swap obligations, its affiliates) make demand upon, assert claims against,
or collect from Borrower or other persons or entities, foreclose any security interest, sell collateral, exhaust any remedies, or take any other action against Borrower or other persons or entities prior to making demand upon, collecting from or
taking action against Guarantor with respect to the Guaranteed Obligations, including any such rights Guarantor might otherwise have had under Va. Code §§ 49-25 and 49-26, et seq., N.C.G.S. §§ 26-7, et seq., Tenn.
Code Ann. § 47-12-101, O.C.G.A. § 10-7-24, Mississippi Code Ann. Section 87-5-1, California Civil Code Section §§ 2787 to 2855 inclusive, and any successor statute and any other applicable law; (c) any law or statute
that requires that Borrower or any other person be joined in, notified of or made part of any action against Guarantor; (d) that Bank or its affiliates preserve, insure or perfect any security interest in collateral or sell or dispose of
collateral in a particular manner or at a particular time, provided that Bank’s obligation to dispose of Collateral in a commercially reasonable manner is not waived hereby; (e) notice of extensions, modifications, renewals, or novations
of the Guaranteed Obligations, of any new 
  

 
transactions or other relationships between Bank, Borrower and/or any guarantor, and of changes in the financial condition of, ownership of, or business
structure of Borrower or any other guarantor; (f) presentment, protest, notice of dishonor, notice of default, demand for payment, notice of intention to accelerate maturity, notice of acceleration of maturity, notice of sale, and all other
notices of any kind whatsoever to which Guarantor may be entitled; (g) the right to assert against Bank or its affiliates any defense (legal or equitable), set-off, counterclaim, or claim that Guarantor may have at any time against Borrower or
any other party liable to Bank or its affiliates; (h) all defenses relating to invalidity, insufficiency, unenforceability, enforcement, release or impairment of Bank or its affiliates’ lien on any collateral, of the Loan Documents, or of
any other guaranties held by Bank; (i) any right to which Guarantor is or may become entitled to be subrogated to Bank or its affiliates’ rights against Borrower or to seek contribution, reimbursement, indemnification, payment or the like,
or participation in any claim, right or remedy of Bank or its affiliates against Borrower or any security which Bank or its affiliates now has or hereafter acquires, until such time as the Guaranteed Obligations have been fully satisfied beyond the
expiration of any applicable preference period; (j) any claim or defense that acceleration of maturity of the Guaranteed Obligations is stayed against Guarantor because of the stay of assertion or of acceleration of claims against any other
person or entity for any reason including the bankruptcy or insolvency of that person or entity; (k) the right to marshalling of Borrower’s assets or the benefit of any exemption claimed by Guarantor; (l) any defense based upon any
lack of authority of the officers, directors, partners or agents acting or purporting to act on behalf of Borrower or any principal of Borrower or any defect in the formation of Borrower or any principal of Borrower; (m) any defense based upon
Bank’s election, in any proceeding instituted under the Federal Bankruptcy Code, of the application of Section 1111(b)(2) of the Federal Bankruptcy Code or any successor statute; (n) any defense based upon any borrowing or any grant
of a security interest under Section 364 of the Federal Bankruptcy Code; and (o) the benefit of any statute of limitations affecting the liability of Guarantor hereunder or the enforcement hereof. Guarantor acknowledges and represents that
Guarantor has relied upon Guarantor’s own due diligence in making an independent appraisal of Borrower, Borrower’s business affairs and financial condition, and any collateral; Guarantor will continue to be responsible for making an
independent appraisal of such matters; and Guarantor has not relied upon Bank or its affiliates for information regarding Borrower or any collateral. Guarantor agrees that the payment of all sums payable under the Guaranteed Obligations or any part
thereof or other act which tolls any statute of limitations applicable to the Guaranteed Obligations shall similarly operate to toll the statute of limitations applicable to Guarantor’s liability hereunder. 
 FINANCIAL CONDITION. Guarantor warrants, represents and covenants to Bank and its affiliates that on and after the date hereof: (a) the fair saleable value
of Guarantor’s assets exceeds its liabilities, Guarantor is meeting its current liabilities as they mature, and Guarantor is and shall remain solvent; (b) all financial statements of Guarantor furnished to Bank are correct and accurately
reflect the financial condition of Guarantor as of the respective dates thereof; (c) since the date of such financial statements, there has not occurred a material adverse change in the financial condition of Guarantor; (d) there are not
now pending any court or administrative proceedings or undischarged judgments against Guarantor, no federal or state tax liens have been filed or threatened against Guarantor, and Guarantor is not in default or claimed default under any agreement;
and (e) at such reasonable times as Bank requests, Guarantor will furnish Bank and its affiliates with such other financial information as Bank and its affiliates may reasonably request. 
 INTEREST AND APPLICATION OF PAYMENTS. Regardless of any other provision of this Guaranty or other Loan Documents, if for any reason the effective interest on any
of the Guaranteed Obligations should exceed the maximum lawful interest, the effective interest shall be deemed reduced to and shall be such maximum lawful interest, and any sums of interest which have been collected in excess of such maximum lawful
interest shall be applied as a credit against the unpaid principal balance of the Guaranteed Obligations. Monies received from any source by Bank or its affiliates for application toward payment of the Guaranteed Obligations may be applied to such
Guaranteed Obligations in any manner or order deemed appropriate by Bank and its affiliates. 

 DEFAULT. If any of the following events occur, a default (“Default”) under this Guaranty shall exist:
(a) failure of timely payment or performance of the Guaranteed Obligations or a default under any Loan Document; (b) a breach of any agreement or representation contained or referred to in the Guaranty, or any of the Loan Documents, or
contained in any other contract or agreement of Guarantor with Bank or its affiliates, whether now existing or hereafter arising; (c) the death of, appointment of a guardian for, dissolution of, termination of existence of, loss of good
standing status by, appointment of a receiver for, assignment for the benefit of creditors of, or the commencement of any insolvency or bankruptcy proceeding by or against Guarantor or any general partner of or the holder(s) of the majority
ownership interests of Guarantor; and/or (d) Bank determines in good faith, in its sole discretion, that the prospects for payment or performance of the Guaranteed Obligations are impaired or a material adverse change has occurred in the
business or prospects of Borrower or Guarantor, financial or otherwise. 
 If a Default occurs, the Guaranteed Obligations shall be due immediately and
payable without notice, other than Guaranteed Obligations under any swap agreements (as defined in 11 U.S.C. § 101, as in effect from time to time) with Bank or its affiliates, which shall be due in accordance with and governed by the
provisions of said swap agreements, and, Bank and its affiliates may exercise any rights and remedies as provided in this Guaranty and other Loan Documents, or as provided at law or equity. Guarantor shall pay interest on the Guaranteed Obligations
from such Default at the highest rate of interest charged on any of the Guaranteed Obligations. 
 ATTORNEYS’ FEES AND OTHER COSTS OF COLLECTION.
Guarantor shall pay all of Bank’s and its affiliates’ reasonable expenses incurred to enforce or collect any of the Guaranteed Obligations, including, without limitation, reasonable arbitration, paralegals’, attorneys’ and
experts’ fees and expenses, whether incurred without the commencement of a suit, in any suit, arbitration, or administrative proceeding, or in any appellate, or bankruptcy proceeding. 
 SUBORDINATION OF OTHER DEBTS. Guarantor agrees: (a) to subordinate the obligations now or hereafter owed by Borrower to Guarantor (“Subordinated
Debt”) to any and all obligations of Borrower to Bank or its affiliates now or hereafter existing while this Guaranty is in effect, provided however that Guarantor may receive regularly scheduled principal and interest payments on the
Subordinated Debt so long as (i) all sums due and payable by Borrower to Bank and its affiliates have been paid in full on or prior to such date, and (ii) no event or condition which constitutes, or which with notice or the lapse of time
would constitute an event of default with respect to the Guaranteed Obligations shall be continuing on or as of the payment date; (b) Guarantor will either place a legend indicating such subordination on every note, ledger page or other
document evidencing any part of the Subordinated Debt or deliver such documents to Bank; and (c) except as permitted by this paragraph, Guarantor will not request or accept payment of or any security for any part of the Subordinated Debt, and
any proceeds of the Subordinated Debt paid to Guarantor, through error or otherwise, shall immediately be forwarded to Bank by Guarantor, properly endorsed to the order of Bank, to apply to the Guaranteed Obligations. 
 MISCELLANEOUS. Assignment. This Guaranty and other Loan Documents shall inure to the benefit of and be binding upon the parties and their respective heirs, legal
representatives, successors and assigns. Bank’s interests in and rights under this Guaranty and other Loan Documents are freely assignable, in whole or in part, by Bank. Any assignment shall not release Guarantor from the Guaranteed
Obligations. Organization; Powers. Guarantor (i) is (a) an adult individual and is sui juris, or (b) a corporation, general partnership, limited partnership, limited liability company or other legal entity (as indicated
below), duly organized, validly existing and in good standing under the laws of its state of organization, and is authorized to do business in each other jurisdiction wherein its ownership of property or conduct of business legally requires such
organization, (ii) has the power and authority to own its properties and assets and to carry on its business as now being conducted and as now contemplated; and (iii) has the power and authority to execute, deliver and perform, and by all
necessary action has authorized the execution, delivery and performance of, all of its obligations under this Guaranty and any other Loan Document to which it is a party. Applicable Law; Conflict Between Documents. This Guaranty shall be
governed by and interpreted in accordance with federal law and, except as preempted by federal law, 

 
the laws of the state named in Bank’s address on the first page hereof without regard to that state’s conflict of laws principles. If the terms of
this Guaranty should conflict with the terms of any commitment letter that survives closing, the terms of this Guaranty shall control. Guarantor’s Accounts. Except as prohibited by law, Guarantor grants Bank and its affiliates a security
interest in all of Guarantor’s deposit accounts and investment properties maintained with Bank and its affiliates. Jurisdiction. Guarantor irrevocably agrees to non-exclusive personal jurisdiction in the state named in Bank’s
address on the first page hereof. Severability. If any provision of this Guaranty or of the other Loan Documents shall be prohibited or invalid under applicable law, such provision shall be ineffective but only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Guaranty or other Loan Documents. Payments. All payments shall be mailed to Commercial Loan Services, P. O. Box 740502,
Atlanta, GA 30374-0502. Notices. Any notices to Guarantor shall be sufficiently given if in writing and mailed or delivered to Guarantor’s address shown above or such other address as provided hereunder, and to Bank, if in writing and
mailed or delivered to Wachovia Bank, National Association, Mail Code VA7628, P.O. Box 13327, Roanoke, VA 24040 or Wachovia Bank, National Association, Mail Code VA7628, 7711 Plantation Road, Roanoke, VA 24019 or such other address as Bank may
specify in writing from time to time. Notices to Bank must include the mail code. In the event that Guarantor changes Guarantor’s address at any time prior to the date the Guaranteed Obligations are paid in full, Guarantor agrees to promptly
give written notice of said change of address to Bank by registered or certified mail, return receipt requested, all charges prepaid. Plural; Captions. All references in the Loan Documents to borrower, guarantor, person, document or other
nouns of reference mean both the singular and plural form, as the case may be, and the term “person” shall mean any individual person or entity. The captions contained in the Loan Documents are inserted for convenience only and shall not
affect the meaning or interpretation of the Loan Documents. Binding Contract. Guarantor by execution of and Bank by acceptance of this Guaranty agree that each party is bound to all terms and provisions of this Guaranty. Amendments,
Waivers and Remedies. No waivers, amendments or modifications of this Guaranty and other Loan Documents shall be valid unless in writing and signed by an officer of Bank. No waiver by Bank or its affiliates of any Default shall operate as a
waiver of any other Default or the same Default on a future occasion. Neither the failure nor any delay on the part of Bank or its affiliates in exercising any right, power, or privilege granted pursuant to this Guaranty and other Loan Documents
shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise or the exercise of any other right, power or privilege. All remedies available to Bank or its affiliates with respect to this
Guaranty and other Loan Documents and remedies available at law or in equity shall be cumulative and may be pursued concurrently or successively. Partnerships. If Guarantor is a partnership, the obligations, liabilities and agreements on the
part of Guarantor shall remain in full force and effect and fully applicable notwithstanding any changes in the individuals comprising the partnership. The term “Guarantor” includes any altered or successive partnerships, and predecessor
partnership(s) and the partners shall not be released from any obligations or liabilities hereunder. Loan Documents. The term “Loan Documents” refers to all documents executed in connection with or related to the Guaranteed
Obligations and may include, without limitation, commitment letters that survive closing, loan agreements, other guaranty agreements, security agreements, instruments, financing statements, mortgages, deeds of trust, deeds to secure debt, letters of
credit and any amendments or supplements (excluding swap agreements as defined in 11 U.S.C. § 101, as in effect from time to time). LIMITATION ON LIABILITY; WAIVER OF PUNITIVE DAMAGES. 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 AGREEMENT, 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. Telephone Communication Monitoring. Guarantor agrees that Guarantor’s telephone communications with Bank may be monitored and/or recorded to improve customer service 

 
and security. Final Agreement. This Agreement and the other Loan Documents represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous or subsequent agreements of the parties. There are no unwritten agreements between the parties. 
 FINANCIAL AND OTHER INFORMATION. Guarantor shall deliver to Bank such information as Bank may reasonably request from time to time, including without limitation, financial statements and information pertaining to Guarantor’s
financial condition. Such information shall be true, complete, and accurate. 
 NEGATIVE COVENANTS. Guarantor agrees that from the date hereof and
until final payment in full of the Guaranteed Obligations, unless Bank shall otherwise consent in writing, Guarantor will not: Default on Other Contracts or Obligations. Default on any material contract with or obligation when due to a third
party or default in the performance of any obligation to a third party incurred for money borrowed. Government Intervention. Permit the assertion or making of any seizure, vesting or intervention by or under authority of any governmental
entity, as a result of which the management of Guarantor or any guarantor is displaced of its authority in the conduct of its respective business or such business is curtailed or materially impaired. Judgment Entered. Permit the entry of any
monetary judgment or the assessment against, the filing of any tax lien against, or the issuance of any writ of garnishment or attachment against any property of or debts due. Retire or Repurchase Capital Stock. Retire or otherwise acquire
any of its capital stock. 
 ANNUAL FINANCIAL STATEMENTS. Guarantor shall deliver to Bank, within 90 days after the close of each fiscal year, audited
financial statements reflecting its operations during such fiscal year, including, without limitation, a balance sheet, profit and loss statement and statement of cash flows, with supporting schedules; all on a consolidated and consolidating basis
with respect to Guarantor and its subsidiaries, affiliates and parent or holding company, as applicable, and in reasonable detail, prepared in conformity with generally accepted accounting principles, applied on a basis consistent with that of the
preceding year. If audited statements are required, all such statements shall be examined by an independent certified public accountant acceptable to Bank. The opinion of such independent certified public accountant shall not be acceptable to Bank
if qualified due to any limitations in scope imposed by Guarantor or any other person or entity. Any other qualification of the opinion by the accountant shall render the acceptability of the financial statements subject to Bank’s approval.

 PERIODIC FINANCIAL STATEMENTS. Guarantor shall deliver to Bank within 30 days of filing, complete copies each of the 10-Q Report and the 10-K
Report. 
 WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF GUARANTOR BY EXECUTION HEREOF AND BANK BY ACCEPTANCE HEREOF,
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT EACH MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY, THE LOAN DOCUMENTS OR ANY AGREEMENT CONTEMPLATED TO BE
EXECUTED IN CONNECTION WITH THIS GUARANTY, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY WITH RESPECT HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT TO BANK TO ACCEPT THIS GUARANTY. EACH
OF THE PARTIES AGREES THAT THE TERMS HEREOF SHALL SUPERSEDE AND REPLACE ANY PRIOR AGREEMENT RELATED TO ARBITRATION OF DISPUTES BETWEEN THE PARTIES CONTAINED IN ANY LOAN DOCUMENT OR ANY OTHER DOCUMENT OR AGREEMENT HERETOFORE EXECUTED IN CONNECTION
WITH, RELATED TO OR BEING REPLACED, SUPPLEMENTED, EXTENDED OR MODIFIED BY, THIS GUARANTY. 
 CONFESSION OF JUDGMENT. Each Guarantor hereby constitutes
and appoints John G. Fox, Thomas G. Cooper, Sr. (each of whom is an officer of Bank), and Bank through an officer duly authorized by Bank (any of the foregoing may act), as the true and lawful attorneys-in-fact for them, in any or all of their
names, place and stead, and upon the occurrence of a Default in the payment of the Guaranteed Obligations due under this Guaranty, at maturity, or upon acceleration, to confess judgment against them or any of them, in favor of Bank, before the Clerk
of the Circuit Court for City of Richmond, Virginia, in 

 accordance with 1950 Code of Virginia, Section 8.01-431 et seq., and any successor statute, for all amounts
owed with respect to the Guaranteed Obligations under and pursuant to this Guaranty including, without limitation, all costs of collection and attorneys’ fees in an amount equal to 15% of the Guaranteed Obligations then outstanding (which shall
be deemed reasonable attorneys’ fees for the purposes of this paragraph), and court costs, hereby ratifying and confirming the acts of said attorney-in-fact as if done by themselves. Upon request of Bank, each Guarantor will execute an
amendment or other agreement substituting attorneys-in-fact appointed to act for each Guarantor hereunder. 
 IN WITNESS WHEREOF, Guarantor, on the
day and year first written above, has caused this Unconditional Guaranty to be duly executed under seal. 
  

					
	RGC Resources, Inc.
			
	By:	 	 /s/    John B. Williamson, III
	 	(SEAL)
		 	John B. Williamson, III,	 	
		 	Chairman, President and Chief Executive Officer

 Commonwealth of Virginia 
 County/City of ROANOKE 
 Corporate Acknowledgment 
 I certify that before me appeared this day John B. Williamson, III, a person known to me, who after being sworn said he is Chairman, President and Chief
Executive Officer of RGC Resources, Inc., a Virginia Corporation, and is duly authorized to act on behalf of said Corporation, that the seal affixed to the foregoing instrument is the seal of said Corporation and that said instrument was signed and
sealed by him on behalf of said Corporation, and being informed of the contents thereof, acknowledged execution of the foregoing instrument on behalf of said Corporation. 
 Witness my hand and official seal, this 23rd day of March, 2009. 
  

							
		  		  	 /s/    Susan E. Miller,
	  	Notary Public
		  	Notary Seal	  	 Susan E. Miller
	  	
		  		  	(Printed Name of Notary)	  	
		
		  	 My Commission Expires: 4-30-09

		  		  	Registration Number: 226082

  

					
	By:	 	 /s/    Howard T. Lyon
	 	(SEAL)
		 	Howard T. Lyon,
		 	Vice President and Treasurer

 Commonwealth of Virginia 
 County/City of ROANOKE 
 Corporate Acknowledgment 
 I certify that before me appeared this day Howard T. Lyon, a person known to me, who after being sworn said he is Vice President and Treasurer of RGC
Resources, Inc., a Virginia Corporation, and is duly authorized to act on behalf of said Corporation, that the seal affixed to the foregoing instrument is the seal of said Corporation and that said instrument was signed and sealed by him on behalf
of said Corporation, and being informed of the contents thereof, acknowledged execution of the foregoing instrument on behalf of said Corporation. 
 Witness my hand and official seal, this 23rd day of March, 2009. 
  

									
		 	 Notary Seal
	 	 /s/    Susan E. Miller,
	  	 Notary Public 

		 		 	 Susan E. Miller
	  	
		 		 	(Printed Name of Notary)	  	
				
		 		 	My Commission Expires: 4-30-09	  	
		 		 	Registration Number: 226082	  	

 Doc Tracking #: 958971 - rke 
 CAT - Deal # 1111191 Facility ID 888693Asset Purchase Agreement

 EXHIBIT 10.18 
 ASSET PURCHASE AGREEMENT 
 THIS ASSET PURCHASE AGREEMENT (this “Agreement”)
is entered into as of this 18th day of November, 2008, by and between BSQUARE Corporation, a Washington corporation (“Buyer”), and TestQuest, Inc., a Delaware corporation (“Seller”). Buyer and Seller are sometimes
each referred to as a “Party” and collectively referred to herein as the “Parties.” 
 WHEREAS, Buyer
desires to acquire from Seller, and Seller desires to sell to Buyer, certain assets of Seller on the terms and subject to the conditions set forth in this Agreement; and 
 WHEREAS, the Parties have executed a term sheet dated October 28, 2008, relating to the sale of assets as contemplated herein (the “Term Sheet”); 
 Now, therefore, in consideration of the mutual agreements, representations, warranties and covenants set forth below, the Parties agree as follows:

 1. Definitions. For purposes of this Agreement, the following terms shall have the meanings set forth in this Section 1: 
 “Acquired Assets” means all right, title and interest in and to all of the assets of Seller solely related to Seller’s business
(the “Test Business”) which include, but are not limited to, those identified on Schedule 1-A to this Agreement, and specifically do not include the Excluded Assets. The Acquired Assets include (i) all of Seller’s
equipment and other tangible assets related to the Test Business, including, any servers on which any source code relating to the Test Business resides, but excluding any leased equipment that has not been fully paid prior to Closing; (ii) all
of Seller’s intangible assets related to the Test Business, including, without limitation, the intellectual property identified in Schedule 1-A (all such intangible assets shall hereinafter be collectively referred to as the “TQ
Intellectual Property”); (iii) all personal computers and necessary personal equipment associated with Seller’s personnel, but excluding any leased computer equipment that has not been fully paid prior to Closing; (iv) all
rights under the Contracts; (v) all of Seller’s rights, claims, prepays, credits, causes of action or rights of set-off against third parties relating solely to the Acquired Assets, including, without limitation, unliquidated rights under
warranties; (vi) all permits, authorizations, consents and approvals of any Governmental or Regulatory Authority affecting or relating in any way to the Test Business to the extent that they are assignable; (vii) all books, records files
and papers, whether in hard copy or electronic format, used for the Test Business, including, without limitation, engineering information, sales and promotional literature, sales and purchase correspondence relating to the Acquired Assets, manuals
and data, lists of present, former and prospective suppliers or customers, business contacts, personnel and employment records; (viii) all third-party computer software programs (e.g. source code server), data and associated licenses used in
connection with the Test Business to the extent such licenses are assignable; (ix) all goodwill associated with the Test Business or the Acquired Assets, together with the right to represent to third parties that Buyer is the successor to the
Test Business; (x) all rights to bring and defend claims or causes of action related to any of the Acquired Assets; and (xi) all Accounts Receivable. 
 “Affiliate” means any Person that directly or indirectly through one of more intermediaries, controls or is controlled by or is under common control with the Person specified. For purposes of this
definition, control of a Person means the power, direct or indirect, to direct or cause the direction of the management and policies of such Person whether by agreement or otherwise and, in any event and without limitation of the previous sentence,
any Person owning fifty percent (50%) or more of the voting securities of another Person shall be deemed to control that Person. 
  

 1 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 “Assumed Liabilities” means (a) the accrued vacation liability and commissions of
each of the Employees in the amounts specified for each Employee as set forth in Schedule 3-B; (b) the obligations and liabilities of Seller relating to the Test Business for the parties and in the amounts as set forth in Schedule
2; (c) any obligations and liabilities under the Contracts arising on or after the Closing. 
 “Closing” has the
meaning set forth in Section 8(a). 
 “Closing Date” has the meaning set forth in Section 8(a).

 “Consultants” has the meaning set forth in Section 5(e). 
 “Contracts” has the meaning set forth in Section 3(i). 
 “Critical Employees” has the meaning set forth in Schedule 3. 
 “Excluded Assets” means all Seller’s cash and investments, the Seller’s company stock of all subsidiary and branch offices and
those assets whereby Seller currently has an outstanding lease agreement that will not be fulfilled at the time of Closing as set forth in Schedule 1-B. 
 “Employees” has the meaning set forth in Section 5(e). 
 “First
Installment” has the meaning set forth in Section 2(c)(ii). 
 *** 
 “Governmental or Regulatory Authority” means any court, tribunal, arbitrator, authority, agency, commission, official or other
instrumentality of the United States, any foreign country or any domestic or foreign state, county, city or other political subdivision. 
 “Leases” has the meaning set forth in Section 3(l). 
 “Liability” means any liability
(whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes. 
 “Material Adverse Effect” means (a) any material adverse change in or effect on the Test Business, prospects, or results of
operations in respect of the Test Business, the Acquired Assets or the Assumed Liabilities or (b) any material adverse change in or effect on the ability of Seller to perform its obligations hereunder. 
 “Party” and “Parties” have the meaning set forth in the first paragraph of this Agreement. 
 “Person” means an individual, a partnership, a corporation, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization, or a governmental entity (or any department, agency, or political subdivision thereof). 
  

 2 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 “Purchase Price” has the meaning set forth in Section 2(c). 
 “Required Consents” has the meaning set forth in Section 3(j). 
 “Schedules” means the Schedules attached to this Agreement. 
 “Second Installment” has the meaning set forth in Section 2(c)(iii). 
 “Security Interest” means any mortgage, pledge, lien, attachment, encumbrance, charge, or other security interest. 
 “Seller’s Knowledge” and like terms as used herein mean the knowledge that any one of Martin Hahn, John Kirsten, or Richard Couch
obtains using the care of a prudent business person after making due inquiries of all of Martin Hahn’s direct reports. The inclusion of these named persons notwithstanding, Buyer agrees that none of these individuals shall be held individually
liable for any breach of any of Seller’s obligations under this Agreement. 
 “SVB” has the meaning set forth in
Section 2(c)(ii). 
 “Tax” means any federal, state, local, or foreign income, gross receipts, license, payroll,
employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, capital stock, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property,
sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not. 
 “Term Sheet” has the meaning set forth in the second WHEREAS clause above. 
 2. Sale and Purchase. 
 (a) Sale and Purchase of
Acquired Assets. On and subject to the terms and conditions of this Agreement and for the consideration specified in this Section 2, Buyer hereby purchases from Seller, and Seller hereby sells, transfers, conveys, and delivers to
Buyer, the Acquired Assets. 
 (b) No Assumption of Liabilities. Buyer shall neither assume nor become responsible for any of
Seller’s Liabilities other than the Assumed Liabilities. 
 (c) Purchase Price. The “Purchase Price” for the Acquired
Assets shall be two million two hundred thousand US dollars ($2,200,000), subject to adjustment as set forth below in Section 5(g). The Purchase Price shall be paid as follows: 
 (i) On October 30, 2008, pursuant to the provisions of the Term Sheet, Buyer delivered two hundred thousand US dollars ($200,000) to Seller as an
advance against the Purchase Price (the “Deposit”); 
 (ii) At Closing, Buyer shall pay one million seven hundred thousand
US Dollars ($1,700,000) (the “First Installment”) to be paid $413,074.73 to Seller and $1,286,925.27 to Silicon Valley Bank (“SVB”) pursuant to the wire instructions set forth in Section 8(c) below; and

 (iii) On or prior to December 5, 2008, Buyer shall pay to Seller, three hundred thousand US dollars ($300,000) less any adjustments
as provided in Section 5(g) (the 

  

 3 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 
“Second Installment”). Buyer agrees that it will not withhold payment for any amount of the Second Installment, except such amounts that are
to be deducted pursuant to Section 5(g) or that are subject to a good faith dispute. 
 (d) Expenses. Buyer will pay up to
a maximum of thirty five thousand US dollars ($35,000) to reimburse Martin Hahn or other Employees for expenses that are pre-approved by Buyer and incurred between the date the Term Sheet was signed and Closing. 
 3. Representations and Warranties of Seller. Except as set forth on the Seller Disclosure Schedule attached hereto as Schedule 4, Seller represents and
warrants to Buyer, as of the Closing Date, as follows: 
 (a) Organization and Standing. Seller is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of Delaware, and is qualified to conduct business in each jurisdiction in which it conducts business, except where the failure to so qualify would not have a Material Adverse Effect.

 (b) Authority, Authorization and Enforceability. Seller has the requisite corporate power and authority to own, license, lease and
use the Acquired Assets as presently owned, licensed, leased and used by it. Seller has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder, including, without limitation, the authority to transfer
the Acquired Assets to Buyer. All action by Seller necessary for the authorization, execution, deliver and performance of this Agreement, including, without limitation, all required payments to and releases from any debtors, any required approvals
by Seller’s board of directors and shareholders, has been taken. This Agreement constitutes the valid and legally binding obligation of Seller, enforceable in accordance with its terms and conditions. 
 (c) Noncontravention. To Seller’s Knowledge neither the execution and the delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will: (i) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of any Governmental or Regulatory Authority to which Seller or the
Acquired Assets are subject; or (ii) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under, any
agreement, contract, lease, license, instrument, or other arrangement to which Seller is a party or by which it is bound or to which any of its assets is subject (or result in the imposition of any Security Interest upon any of Seller’s
assets). Seller does not need to give any notice to, make any filing with, or obtain any authorization, consent, or approval of any Governmental or Regulatory Authority or any other third party in order for the Parties to consummate the transactions
contemplated by this Agreement. 
 (d) Brokers’ Fees. Seller has no Liability or obligation to pay any fees or commissions to any
broker, finder, or agent with respect to the transactions contemplated by this Agreement for which Buyer could become liable or obligated. 
 (e) Title to Assets. Seller has good and marketable title to the Acquired Assets, free and clear of any Security Interest or restriction on transfer, and upon consummation of the transactions contemplated by this Agreement, Buyer
shall enjoy good and marketable title to all of the Acquired Assets, free and clear of any Security Interest or restriction on transfer. 
  

 4 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 (f) Litigation. No action, suit, or proceeding is pending or, to Seller’s Knowledge,
threatened, that affects any of the Acquired Assets, or that would (i) prevent consummation of any of the transactions contemplated by this Agreement, (ii) cause any of the transactions contemplated by this Agreement to be rescinded
following consummation or (iii) affect adversely the right of Buyer to own the Acquired Assets, and no such injunction, judgment, order, decree, ruling, or charge is in effect. 
 g) Intellectual Property. 
 (i) Seller
owns or possesses sufficient legal rights to all TQ Intellectual Property without any conflict with, or infringement of, the rights of others. Neither the development, manufacture, marketing, license, sale or use of any product, service or TQ
Intellectual Property currently licensed, used or sold by Seller or currently under development violates or will violate any license, requirements, restrictions or agreement to which Seller is a party, or infringes or will infringe any copyright,
patent, trademark, service mark, trade secret or other intellectual property or other proprietary right of any other party. All registered trademarks, service marks, patents and copyrights relating to the TQ Intellectual Property, if any, are valid
and subsisting. 
 (ii) There are no outstanding options, licenses, agreements, claims, third-party software and/or third-party software
rights, encumbrances or shared ownership interests of any kind relating to, or incorporated within, the TQ Intellectual Property, nor is Seller bound by or a party to any options, licenses or agreements of any kind with respect to the patents,
trademarks, service marks, trade names, copyrights, trade secrets, licenses, information, proprietary rights and processes of any other Person. No third party has any right to compensation (including, without limitation, fees or royalties) from
Seller by reason of use of the TQ Intellectual Property or conduct of the Test Business, and Seller has not received any notice nor does Seller have any knowledge of any complaint, assertion, threat, or allegation inconsistent with the preceding
statements in this paragraph. 
 (iii) Seller has obtained and possesses valid licenses to use all of the software programs present on the
computers and other software-enabled electronic devices that are included in the Acquired Assets. 
 (iv) Seller has not embedded any open
source, copyleft or community source code in the TQ Intellectual Property or any of the other Acquired Assets, including, but not limited to, any libraries or code licensed under any General Public License, Lesser General Public License or similar
license arrangement (“Publicly Available Software”) in a manner that may subject the TQ Intellectual Property, in whole or in part, to the license obligations of any Publicly Available Software. 
 (v) The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby (including, without
limitation, the continued conduct by Buyer after the Closing Date of the Test Business as presently conducted by Seller and the incorporation of any TQ Intellectual Property in any products or services of Buyer) will not breach, violate or conflict
with any instrument or agreement governing any TQ Intellectual Property necessary or required for, or used in, the conduct of the Test Business as presently conducted and will not cause the forfeiture or termination or give rise to a right of
forfeiture or termination of any such TQ Intellectual Property or in any material way impair the right of Buyer or any of its affiliates to use, sell, license or dispose of, or to bring any action for the infringement of, any such TQ Intellectual
Property or portion thereof. 
 (vi) There is no pending or threatened claim or litigation contesting the validity, ownership or right to
use, sell, license or dispose of any of the Acquired Assets (including, without limitation, the TQ Intellectual Property) necessary or required for, or used in, 

  

 5 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 
the conduct of the Test Business as presently conducted nor is there any basis for any such claim, nor has Seller received any notice asserting that any such
Acquired Asset (including, without limitation, the TQ Intellectual Property) or the proposed use, sale, license or disposition thereof conflicts or will conflict with the rights of any other party, nor is there any basis for any such assertion. To
Seller’s knowledge, there is no material unauthorized use, infringement or misappropriation on the part of any third party of the Acquired Assets (including, without limitation, the TQ Intellectual Property). 
 (vii) Seller has taken all reasonable and necessary steps to maintain the secrecy and confidentiality of, and its proprietary rights in, all information
or technology necessary or required for, or used in, the conduct of the Test Business as presently conducted. This includes, without limitation, entering into confidentiality and non-disclosure agreements with all officers, employees and contractors
of and consultants to Seller, and customers who have had access to or knowledge of the Acquired Assets (including, without limitation, the TQ Intellectual Property). The Seller has provided to Buyer copies of the employee confidentiality agreements.
To Seller’s Knowledge, these confidentiality obligations have not been breached. 
 (viii) All fees to maintain Seller’s rights in
the TQ Intellectual Property, including, without limitation, all professional fees in connection therewith pertaining to the TQ Intellectual Property due and payable on or before the Closing Date, have been paid by Seller. 
 (ix) No rights in or to any of the TQ Intellectual Property used by the Seller will be lost, limited, or rendered liable to termination, by virtue of the
transactions contemplated by this Agreement. 
 (h) Sufficiency and Condition of the Acquired Assets. The Acquired Assets are sold
“as is”. However, to Seller’s Knowledge, the Acquired Assets are free from defects (patent and latent). The Acquired Assets are suitable for the purposes for which they presently are used. 
 (i) Contracts; Customers. 
 (i) Seller
has included in Section 3(i) of the Seller Disclosure Schedule a list of all of the contracts and agreements related to the Test Business and the Acquired Assets and all Test Business licensing, professional engineering services and
other customer contracts, under which Seller is currently performing work and/or business. The Acquired Assets shall include all of the contracts set forth in Section 3(i) of the Seller Disclosure Schedule (except those designated as
excluded) and shall be assigned to Buyer at Closing (the “Contracts”). 
 (ii) Seller has made available to Buyer true and
complete copies of all of the Contracts, including all amendments and modifications thereto. Any and all amendments and modification to the Contracts are in writing. Except as set forth in the Seller Disclosure Schedule, (1) none of the
Contracts contain any obligation of Seller to make payments of any kind, whether to the counterparty or a third party, and whether such obligation is direct, contingent, potential or actual and (2) Seller has not taken any action, or failed to
take any action, that would trigger a payment obligation of Seller under any Contract. All of the Contracts are valid and binding and in full force and effect and legally enforceable in accordance with their terms upon the other parties thereto.
There is no breach or default by Seller under any of the Contracts or, to the knowledge of Seller, by any other party thereto, except for such breaches and defaults which in the aggregate would not have a Material Adverse Effect. 
 (iii) *** 
 (iv) No party under any of
the Contracts has cancelled or otherwise terminated its relationship with Seller or has materially decreased its usage or purchase of the services or products of Seller that are to be provided under any of the current Contracts. No party under any
of the Contracts has, to Seller’s Knowledge, any plan or intention to terminate, cancel 

  

 6 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 
or otherwise adversely modify its relationship, as set forth in the current Contracts with Seller (or, following the Closing, with Buyer). No party under any
of the Contracts has, to Seller’s Knowledge, notified Seller that it plans or intends to decrease or limit its usage or purchase of any products or services of Seller (or, following the Closing, of Buyer) that is part of a current Contract or
that Seller has represented to Buyer as being an order that is in process. 
 (v) Seller has not entered into any agreements, oral or
written, whereby any source code related to any of the Acquired Assets has been provided or licensed to any third party. 
 (j)
Consents. Section 3(j) of the Seller Disclosure Schedule lists each consent, notification, approval, permit or authorization of, or declaration to or filing with any governmental or regulatory authority, or any other third party
that is required to consummate this Agreement and the transactions contemplated hereby, including, without limitation, to effect the assignment of any Contract (the “Required Consents”). 
 (k) Payroll. Employees will continue to receive their normal compensation from the Seller through the Closing Date, less ordinary withholdings as
normally processed through payroll. Seller shall be responsible for all amounts of compensation accrued but not yet paid as of the Closing Date (including accrued but unpaid bonuses, royalties and commissions, but excluding accrued vacation and
commissions as set forth in Schedule 3). Schedule 3 sets forth the accrued vacation and commissions for each Employee as of the Closing Date. 
 (l) Real Property. Seller leases the real property located at 8976 Lake Dr, East, Minneapolis, MN 55317 and Suite 1825, 18F China Merchants Tower, 118 Jian Guo Road, Chao Yang District, Beijing, 100022, China
(the “TQ Real Property”) pursuant to the certain lease agreement dated February 1, 2001 by and between the Seller and the landlord, expiring as of January 31, 2009 and the lease agreement with landlord in China, dated as
of August 1, 2008 and expiring December 21, 2008 (the “Leases”). The Seller does not occupy, lease, use or own any other real property and the Seller has not leased or otherwise granted any person or entity the right to use or
occupy the TQ Real Property or any portion thereof; 
 (m) Disclosure. To the knowledge of Seller, the representations and warranties
contained in this Section 3 do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements and information contained in this Section 3 not misleading.

 4. Representations and Warranties of Buyer. Buyer represents and warrants to Seller as of the date of this Agreement and as of Closing, as follows:

 (a) Organization and Standing. Buyer is a corporation, duly organized and validly existing under the laws of the State of
Washington and is qualified to conduct business in each jurisdiction in which the property owned, leased or operated by it requires it to be so qualified, except where the failure to so qualify would not have a material adverse effect. 

(b) Authority, Authorization and Enforceability. Buyer has the requisite power and authority to execute and deliver this Agreement and to
perform and comply with all of the terms, covenants and conditions to be performed and complied with by Buyer hereunder. All action by Buyer necessary for the authorization, execution, delivery and performance by Buyer of this Agreement has been
taken. This Agreement constitutes the valid and legally binding obligation of Buyer, enforceable in accordance with its terms and conditions. 
  

 7 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 5. Covenants and Obligations of the Parties. The Parties covenant as follows: 
 (a) Ordinary Course. Except as contemplated by this Agreement or with the prior written consent of Buyer, between the date of the Term Sheet and
the Closing Date, Seller shall operate its Test Business in the ordinary course in accordance with recent business practices. 
 (b)
Confidentiality. Each Party shall keep secret and hold in confidence for a period of three years following the date hereof, any and all information relating to the other Party that is proprietary to such other Party, other than the following:
(a) information that has become generally available to the public other than as a result of a disclosure by such Party; (b) information that becomes available to such Party or an agent of such Party on a nonconfidential basis from a third
party having no obligation of confidentiality to a Party to this Agreement; (c) information that is required to be disclosed by applicable law, judicial order; and (d) disclosures made by any Party as shall be reasonably necessary in
connection with obtaining the Required Consents. In connection with disclosure of confidential information under (c) and (d) above, the disclosing Party shall give the other Party hereto timely prior notice of the anticipated disclosure
and the Parties shall cooperate in designing reasonable procedural and other safeguards to preserve, to the maximum extent possible, the confidentiality of such material. 
 (c) Press Release. After Closing, Buyer shall have full authority to issue a press release, at its sole discretion, regarding this transaction. 
 (d) Consents. Seller shall obtain all of the Required Consents, prior to Closing. 
 (e) Employees and Contractors. Buyer presently intends to (i) make offers of employment to the employees of Seller identified on Schedule
3 (the “Employees”) and (ii) enter into consulting relationships with the contractors of Seller so identified on Schedule 3 (the “Consultants”). The Parties acknowledge that it is a condition of this
transaction that at least 50% of the Employees and all of the Critical Employees become employees of Buyer. Neither Seller nor any of its employees or advisors shall interfere with Buyer’s hiring of such Employees and Consultants. Buyer
has no obligation to offer to employ or employ any of Seller’s employees or contractors. Except for the Assumed Liabilities and the accrued vacation liability and commissions specified in Schedule 3, Seller shall be responsible for, and
shall cause to be discharged and satisfied in full, all amounts owed to all employees and contractors (including the Employees), including, without limitation, all wages, salaries, bonuses, accrued liabilities, incentive compensation, or severance
benefits or payments, earned or payable on or prior to the Closing Date, and Buyer shall have no obligation whatsoever to pay any other amounts to any of Seller’s employees. These amounts shall be paid within five (5) business days
following the Closing. 
 (f) No “Pull Forward” of Revenues. Seller covenants and agrees that during the period commencing
on September 1, 2008 and ending as of the Closing, Seller has operated its business, including, without limitation, its invoicing practices, prepayment arrangements and royalty collections, in accordance with past practices, and has not
accelerated the invoicing or royalty collections. Immediately prior to Closing, Seller shall provide Buyer with reports showing all invoices issued, payments made and royalties collected for the prior forty-five (45) days. 
  

 8 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 (g) Adjustments to Purchase Price. The Purchase Price shall be decreased dollar-for-dollar by:
(i) any amount that the actual amounts owed at Closing to each of the parties specified in Schedule 2, are greater than the amounts as specified therein; (ii) the difference between the total amounts specified in Schedule 3-A (the
Employee Liabilities agreed to in the Term Sheet) and the actual liabilities for Employees assumed by Buyer as specified in Schedule 3-B; (iii) the amount that the Accounts Receivable collectible at Closing (that are less than sixty
(60) days past due and for which Seller has a valid purchase order from the customer or from the end customer in instances where such a purchase order are required, and delivery has been made to the customer by Seller), are collectively less
than $500,000; and (iv) in the event that the financial report information specified in Section 5(f) above demonstrate that Seller has “pulled forward” any of its revenue an equivalent amount of such “pulled
forward” revenue. Adjustments to the Purchase Price shall be taken from the Second Installment. Buyer agrees that in the event Account Receivables greater than 60 days past due are deducted from the Purchase Price, Seller will have the right to
keep ownership and collection of those Account Receivables. 
 (h) Further Assurances and Post-Closing Undertakings. From time to time
after the Closing Date, at the Buyer’s request and without further consideration, the Seller shall execute, acknowledge and deliver such documents, instruments or assurances and take such other actions as the Buyer may reasonably request with
respect to assigning, conveying and transferring to the Buyer any of the Acquired Assets, obtaining any Required Consents for the transfer of the Acquired Assets to the Buyer and further implementing the transactions contemplated hereby. Buyer
agrees that it will provide Seller with reasonable access after Closing to any books and records that are transferred to Buyer that are necessary for Seller to prepare tax returns or make other filings with respect to the discontinuation of its
operations. 
 (i) Acquired Asset Delivery. Seller shall deliver to Buyer all Acquired Assets at the Closing. 
 (j) Test Equipment. Seller agrees to facilitate transfer to Buyer of any customer and/or partner equipment that Seller has in its possession in
connection with the Test Business (the “Test Equipment”). 
 (k) *** 
 6. Conditions Precedent to Obligations of Buyer to Close. The obligations of Buyer to consummate the transactions contemplated by this Agreement to occur at the
Closing shall be subject to the satisfaction, on or before the Closing Date, of each and every one of the following conditions, all or any of which may be waived in writing, in whole or in part, by Buyer for purposes of consummating such
transactions: 
 (a) Representations and Warranties. All representations and warranties of Seller contained in this Agreement shall be
true and complete in all material respects at and as of the Closing Date as though such representations and warranties were made at and as of such time except to the extent changes are permitted or contemplated pursuant to this Agreement.

 (b) Covenants. Seller shall have in all material respects performed and complied with all covenants, obligations, agreements and
conditions required by this Agreement to be performed or complied with by it prior to or on the Closing Date, including but not limited to all of those covenants set forth in Section 5 above. 
  

 9 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 (c) No Injunction. No action, suit or other proceeding shall have been instituted, threatened or
proposed before any Governmental or Regulatory Authority to enjoin, restrain, prohibit or obtain substantial damages in respect of, or which is related to, or arising out of, this Agreement or the consummation of the transactions contemplated
hereby. 
 (d) Consents. Each of the Required Consents shall have been duly obtained and delivered to Buyer. Seller shall have made
all filings with and notifications of Governmental or Regulatory Authorities or other Persons required to be made by such Parties in connection with the execution and delivery of this Agreement, the performance of the transactions contemplated
hereby and the continued operation of the Test Business subsequent to the Closing. 
 (e) Deliveries. Seller shall have made or
stand willing and able to make all the deliveries to Buyer set forth in Section 8(b). 
 (f) No Material Adverse Effect.
Between the date of this Agreement and the Closing Date, there shall have been no Material Adverse Effect on the Test Business or the condition of the Acquired Assets. 
 (g) Assets Released. Seller shall provide evidence of full payment and release of all debt, security instruments and other related attachments to all of the Acquired Assets, including but not limited to, those
held by Silicon Valley Bank, and none of its creditors shall have taken any action to perfect a foreclosure or other seizure of any of the Acquired Assets. 
 (h) Liabilities. There shall be no material increase in the amounts owed to the parties identified in the Assumed Liabilities. 
 (i) Employees. At least 50% of the Employees and all Critical Employees shall have accepted employment with Buyer. 
 (j) I.R.I.S. Seller shall have resolved the outstanding contractual issues with I.R.I.S. to Buyer’s satisfaction. 
 (k) Spirent. Seller’s contract with Spirent shall be renewed and made current to extend for at least 90 days following the Closing Date and shall have been assigned to Buyer. 
 (l) Employee Benefits. Seller shall be current on all amounts owed to all vendors supplying employee benefits or insurance. 
 (m) Legal Files. All of Seller’s legal files, including but not limited to those that relate to all TQ Intellectual Property, shall have been
delivered to Buyer. 
 7. Conditions Precedent to Obligations of Seller to Close. The obligations of Seller to consummate the transactions
contemplated by this Agreement to occur at the Closing shall be subject to the satisfaction, on or before the Closing Date, of each and every one of the following conditions, all or any of which may be waived in writing, in whole or in part, by
Seller for purposes of consummating such transactions: 
 (a) Representations and Warranties. All representations and warranties of
Buyer contained in this Agreement shall be true and complete in all material respects at and as of the Closing Date as though such representations and warranties were made at and as of such time except to the extent changes are permitted or
contemplated pursuant to this Agreement. 
  

 10 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 (b) Covenants. Buyer shall have in all material respects performed and complied with all
covenants, obligations agreements and conditions required by this Agreement to be performed or complied with by it prior to or on the Closing Date. 
 (c) No Injunction. No action, suit or other proceeding shall have been instituted, threatened or proposed before any Governmental or Regulatory Authority to enjoin, restrain, prohibit or obtain substantial damages in respect of, or
which is related to, or arising out of, this Agreement or the consummation of the transactions contemplated hereby. 
 8. The Closing. 
 (a) Closing and Closing Date. The closing (the “Closing”) shall take place on November 18, 2008, or such other date as the
Buyer and the Seller may mutually determine (the “Closing Date”). The Parties shall endeavor to conduct the Closing via facsimile or overnight mail or at such place and time as the Parties may agree. Notwithstanding the foregoing,
the Parties agree that the Closing shall be deemed effective as of 5:00 PM Pacific Standard Time on the Closing Date, and all references herein that relate to the date and time of the Closing shall refer to such effective date and time. 

(b) Seller’s Deliveries. Prior to or on the Closing Date, Seller shall deliver to Buyer the following, in form and substance reasonably
satisfactory to Buyer and its counsel: (i) a duly executed bill of sale, substantially in the form attached hereto as Exhibit A; (ii) the Required Consents as specified in Section 6(d); (iii) ***; (iv) a
certificate, dated as of the Closing Date, executed by the CEO of Seller, and by its President, Martin Hahn, certifying that to each of their knowledge, that the conditions set forth in Section 6 are satisfied; (v) a certificate,
dated as of the Closing Date, executed by the Secretary of Seller, without personal liability: (a) certifying that the Board of Directors and the stockholders of Seller, have authorized and approved the execution of this Agreement on behalf of
Seller and the consummation of the transactions contemplated hereby; and (b) certifying as to the incumbency of the person signing this Agreement on behalf of Seller; and (vi) such other documents reasonably requested by Buyer that are
necessary to carry out the transactions contemplated by this Agreement. 
 (c) At the Closing, Buyer shall pay the First Installment in
accordance with the provisions of Section 2(c) above, by wire transfer in lawful currency of the United States of America to the following accounts: 
 To Seller: 
  

			
	Bank Account Name	  	TestQuest, Inc.
	Account Number	  	***
	Bank	  	***
	ABA Routing Number	  	***

  

 11 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 To SVB: 
  

			
	Bank Account Name	  	Silicon Valley Bank
	Account Number	  	***
	Bank	  	***
	ABA Routing Number	  	***

 9. Termination 
 (a) Binding Agreement. This Agreement constitutes the binding and irrevocable agreement of the Parties to consummate the transactions contemplated hereby, subject to and in accordance with the terms hereof, the
consideration for which is (a) the covenants, representations, warranties and agreements set forth in this Agreement; and (b) the expenditures and obligations incurred and to be incurred by Buyer on the one hand, and by Seller, on the
other hand, in respect of this Agreement. 
 (b) Methods of Termination. This Agreement may be terminated or abandoned only as
follows: (i) by the mutual consent of Seller and Buyer; (ii) by Buyer, if any of the conditions set forth in Section 6 hereof to which the obligations of Buyer are subject have not been fulfilled in all material respects by
Seller, or waived by Buyer, and provided that the failure to fulfill such condition is not a result of a breach of warranty or nonfulfillment of any covenant or agreement by Buyer contained in this Agreement; (iii) by Seller, if any of the
conditions set forth in Section 7 hereof to which the obligations of Seller are subject have not been fulfilled by Buyer in all material respects, or waived by Seller, and provided that the failure to fulfill such condition is not a
result of a breach of warranty or nonfulfillment of any covenant or agreement by Seller contained in this Agreement. 
 10. Miscellaneous. 

(a) Survival of Representations and Warranties. All of the representations and warranties of the Parties contained in this Agreement shall
survive for six (6) months after the Closing. 
 (b) No Third-Party Beneficiaries. Except as expressly provided herein, this
Agreement shall not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns. 
 (c) Entire Agreement. This Agreement (including the Schedules referred to herein) constitutes the entire agreement between the Parties and supersedes any prior understandings, agreements, or representations by or between the
Parties, written or oral, to the extent they related in any way to the subject matter hereof. 
 (d) Succession and Assignment. This
Agreement shall be binding upon and inure to the benefit of the Parties named herein and their respective successors and permitted assigns. Neither Seller nor Buyer may assign this Agreement or any of its rights, interests, or obligations hereunder
without the prior written approval of the other Party. 
 (e) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. 
  

 12 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 (f) Headings. The section headings contained in this Agreement are inserted for convenience only
and shall not affect in any way the meaning or interpretation of this Agreement. 
 (g) Notices. Any notice required or permitted by
this Agreement shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or forty-eight (48) hours after being deposited in the regular mail as
certified or registered mail with postage prepaid, if such notice is addressed to the Party to be notified at such Party’s address or facsimile number as set forth below, or as subsequently modified by written notice: 
  

			
	if to Buyer, to:	  	if to Seller, to:
		
	 BSQUARE Corporation
 110 110th Avenue NE, Suite
200
 Bellevue, WA 98004
 Attention: Chief Financial Officer
 Fax No.: (425) 519-5999
	  	 Richard G. Couch, CEO
 TestQuest, Inc.
 c/o Diablo Management Group, Inc.
 3000F Danville Boulevard
 Suite 532
 Alamo, California 94507
 Fax No.: (925) 979-1958

 (h) Governing Law. This Agreement shall be governed by and construed in accordance with the
domestic laws of the State of Washington, United States, without giving effect to any choice or conflict of law provision or rule that would cause the application of the laws of any other jurisdiction. 
 (i) Amendments and Waivers. No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by the
Parties. No waiver by any Party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or
covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence. 
 (j) Severability.
Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the
offending term or provision in any other situation or in any other jurisdiction. 
 (k) Expenses. Each of Buyer and Seller will bear
its own costs and expenses (including legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby. 
 (l) Specific Performance. Each of the Parties acknowledges and agrees that the other Party would be damaged irreparably in the event any of the provisions of this Agreement are not performed in accordance with their specific terms or
otherwise are breached. Accordingly, each of the Parties agrees that the other Party shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and the terms
and provisions thereof, in addition to any other remedy to which it may be entitled, at law or in equity. 
  

 13 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 (m) Attorneys’ Fees and Costs. If any proceedings are required to enforce any provision or to
remedy any breach of this Agreement, the prevailing Party shall be entitled to an award of reasonable and necessary expenses of litigation, including reasonable attorneys’ fees and costs. 
 (n) Advice of Legal Counsel. Each Party acknowledges and represents that, in executing this Agreement, it has had the opportunity to seek advice
as to its legal rights from legal counsel and that the person signing on its behalf has read and understood all of the terms and provisions of this Agreement. The rule of construction that a written agreement is construed against the Party preparing
or drafting such agreement shall specifically not be applicable to the interpretation of this Agreement. 
 IN WITNESS HEREOF, the Parties
hereto have executed this Agreement as of the date first above written. 
  

									
	 BUYER:
	 		 	SELLER:
			
	BSQUARE CORPORATION	 		 	TESTQUEST, INC.
					
	By	 	  
	 		 	By	 	  

		 	(Signature)	 		 		 	(Signature)
					
		 	  
	 		 		 	  

		 	(Print name)	 		 		 	(Print name)

  

 14 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 SCHEDULE 1-A 
 ACQUIRED ASSETS 
  

	i.	All customer contracts related to the Test Business under which Seller is currently performing work and/or business or pursuant to which any customer owes any money to Seller,
including those for which Seller is currently performing support and maintenance, but specifically excluding any refunds that may be due under such contracts; 

  

	ii.	All equipment and other tangible assets related to the Test Business, including, without limitation any servers on which any source code resides, but excluding any leased assets for
which Buyer is not assuming the leases; 

  

	iii.	All of Seller’s intellectual property and other intangible assets related to the Test Business including, without limitation: (a) all patents, trademarks and copyrights,
including, without limitation, those specified in attached Schedule 1-C; (b) reference implementations; (c) source code; and (d) any additional software, code or related materials required to operate the Test Business;
(e) all rights to bring and defend claims and causes of action related to any of above; 

  

	iv.	All third-party computer software programs (e.g. source code server), data and associated licenses used in connection with the Test Business to the extent that they are assignable;

  

	v.	All computers and necessary personal equipment used by the Employees and any consultants using Seller owned or leased equipment (but excluding any leased equipment for which Buyer
is not assuming the leases); 

  

	vi.	All rights under contracts, agreements, and other interests in personal property, licenses, commitments, sales and purchase orders and other instruments solely related to the Test
Business excluding: a) cash and investments on-hand at Closing; and b) assets associated with leases that Buyer will not be assuming in the transaction; 

  

	vii.	All of Seller’s rights, claims, credits, causes of action or rights of set-off against third parties relating to the Acquired Assets, including, without limitation,
unliquidated rights under warranties; 

  

	viii.	All permits, authorizations, consents and approvals of any governmental entity affecting or relating in any way to the Test Business, to the extent that they are assignable;

  

	ix.	All books, records files and papers, whether in hard copy or electronic format, used in the Test Business, including, without limitation, engineering information, sales and
promotional literature, manuals and data, sales and purchase correspondence, lists of present, former and prospective suppliers or customers, business contacts, personnel and employment records, and any information relating to taxes imposed on the
Test Business or the Acquired Assets; 

  

	x.	All goodwill associated solely with the Test Business or the Acquired Assets, together with the right to represent to third parties that Buyer is the successor to the Test Business;

  

	xi.	All accounts receivables as of the closing date (the “Accounts Receivable”) and all deposits and prepaid amounts or credits related to any of the Acquired Assets or
Assumed Liabilities; and 

  

	xii.	All rights to bring and defend claims and causes of action related to any of the Acquired Assets. 

  

 1 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 SCHEDULE 1-B 
 EXCLUDED ASSETS 
 *** 
  

 2 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 SCHEDULE 1-C 
 *** (5 pages redacted) 
  

 3 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 Schedule 2 
 ASSUMED LIABILITIES 
 *** 
  

 4 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 SCHEDULE 3-A 
 *** (2 pages redacted) 
  

 5 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission. 

 SCHEDULE 4 
 SELLER DISCLOSURE SCHEDULE 
 *** (8 pages redacted) 
  

 6 
 Confidential treatment has been requested for portions of this agreement. This agreement omits the information subject to the confidential treatment request. Omissions are designated as ***. A complete version of this agreement has been
filed separately with the Securities and Exchange Commission.

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