ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

On October 28, 2009, Roanoke Gas Company ("Roanoke"), the utility subsidiary or RGC Resources, Inc. entered into Modification Number Three to the Promissory Note dated March 23, 2009. This Note modifies the available balance outstanding under the original note in favor of Wachovia Bank, National Association ("Wachovia").

The purpose of this modification is to reduce the available balances under the Promissory Note as significantly lower natural gas costs have lowered Roanoke's short-term borrowing requirements. By reducing the available balances under the Promissory Note, Roanoke will also minimize the cost incurred by the availability fee charged by Wachovia for any unutilized balance under the agreement. The Modification provides for revised borrowing limits that range from $3,000,000 to a maximum of $8,000,000 during the remaining term of the Note.

ITEM 9.01. FINANCIAL STATEMENT AND EXHIBITS.

(d) Exhibits.

10.1 Modification Number Three to Promissory Note by Roanoke Gas Company in favor of Wachovia Bank, National Association dated October 28, 2009.

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