I would remove the link. You can keep the testimonial and logo. Removing the link will not impact your rankings.
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Posts made by NicoleDeLeon
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RE: We have a link we to: Grace Construction, but the company has switched owners, and is not local anymore.
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RE: Giving to Charities in exchange for a backlink is a Paid Link. What about links from real charitable donations?
I've never heard of anyone being penalized for sponsorship links. I mean if you think about it everything would be a paid link. If an organization pays an employee to run white hat link building, then are those paid links because the person receives a salary? I think you are fine. Sponsorship links are an excellent way to engage in the local community and receive a link for your efforts.