EXECUTION VERSION

AMENDMENT NO. 3 TO THIRD AMENDED
AND RESTATED LOAN AGREEMENT

This Amendment No. 3 to Third Amended and Restated Loan Agreement, dated as of
September 29, 2020 (the “Amendment”), is made by and among RCM Technologies,
Inc., a Nevada corporation, and all of its subsidiaries (collectively, the
“Borrowers”), Citizens Bank, N.A., a national banking association (as successor
by merger to Citizens Bank of Pennsylvania), in its capacity as administrative
agent and arranger (the “Agent”), and Citizens Bank, N.A., a national banking
association (as successor by merger to Citizens Bank of Pennsylvania), as lender
(the “Lender”).

BACKGROUND
A. The Agent, the Lender and the Borrowers, together with Programming
Alternatives of Minnesota, Inc. (an entity which was dissolved as of January 18,
2019), made, executed and delivered a Third Amended and Restated Loan Agreement,
dated as of August 9, 2018, as amended by that certain Amendment No. 1 to Third
Amended and Restated Loan Agreement, dated as of October 18, 2019, and that
certain Amendment No. 2 to Third Amended and Restated Loan Agreement, dated as
of June 2, 2020  (collectively, the “Original Loan Agreement”).

B. In connection with the Original Loan Agreement, the Borrowers and the Agent
entered into a certain Amended and Restated Pledge and Security Agreement, dated
August 9, 2018, pursuant to which the Borrowers granted to the Agent, for the
benefit of the Lenders, a first priority security interest in the Collateral (as
defined therein) (the “Original Pledge and Security Agreement”).

C. In connection with the Original Loan Agreement, the Borrowers executed and
delivered a Tenth Amended and Restated Revolving Credit Note payable to the
order of the Lender, dated August 9, 2018 (the “Existing Restated Credit Note”).

D. As security for (a) the punctual performance in full by the Borrowers of
their obligations under the Loan Documents (as such term is defined in the
Original Loan Agreement), (b) the punctual payment in full of all amounts owing
or to be owing under any Loan Document, and (c) the punctual payment of any
other amounts which at any time may be due and payable from the Borrowers to the
Agent or the Lenders, in each case whether presently existing or hereafter
arising (collectively, the “Secured Obligations”), the Borrowers have granted a
security interest to the Agent, for the benefit of the Lenders, in the
Collateral (as such term is defined in the Original Pledge and Security
Agreement), pursuant to the terms and provisions of the Original Pledge and
Security Agreement.

E. The Borrowers, the Agent and the Lender desire, subject to the terms and
conditions set forth herein, to amend the Original Loan Agreement (the Original
Loan Agreement, as amended by this Amendment, and as the same may be further
amended, restated, modified and/or supplemented from time to time, being
referred to as the “Loan Agreement”).

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NOW, THEREFORE, in consideration of the mutual promises herein contained, and
each intending to be legally bound hereby, the parties hereto hereby agree as
follows:

1. Defined Terms.  Except as expressly defined herein, all terms used herein
shall have the meanings ascribed to them in the Original Loan Agreement.  This
Amendment is intended to amend the Original Loan Agreement, and the Original
Loan Agreement shall be so amended, from and as of the date hereof.

2. Amendment to Section 1.1 of Original Loan Agreement.  Section 1.1 of the
Original Loan Agreement is hereby amended so that the definition of “Measurement
Period” shall read in its entirety as follows:

“Measurement Period” means, at any date of determination, except as otherwise
provided below in this definition, the most recently completed four consecutive
fiscal quarters of the Borrowers ending on or prior to such date.  A Measurement
Period may be designated by reference to the last day thereof (e.g. the June 30,
2020 Measurement Period refers to the relevant fiscal period of the Borrowers
ended June 30, 2020), and a Measurement Period shall be deemed to end on the
last day thereof.  Notwithstanding the foregoing, for purposes of calculating
the Borrowers’ Consolidated Total Funded Debt to Consolidated EBITDA Ratio and
the Borrowers’ Consolidated  Fixed Charge Coverage Ratio for the Measurement
Periods ending on or after December 31, 2020 but on or before June 30, 2021,
Consolidated EBITDA shall be calculated on an annualized/cumulative basis
(rather than on a rolling four quarters basis) as follows:

(i)
For the fiscal quarter ended December 31, 2020, Consolidated EBITDA shall be
equal to Consolidated EBITDA for the three month period ended December 31, 2020
multiplied by four;

(ii)
For the fiscal quarter ended March 31, 2021, Consolidated EBITDA shall be equal
to Consolidated EBITDA for the six month period ended March 31, 2021 multiplied
by two; and

(iii)
For the fiscal quarter ended June 30, 2021, Consolidated EBITDA shall be equal
to (A) Consolidated EBITDA for the nine month period ended June 30, 2021 divided
by three, multiplied by (B) four.

 
3. Amendment to Section 7.7(b) of Original Loan Agreement.  Section 7.7(b) of
the Original Loan Agreement is hereby amended and restated to read in its
entirety as follows:

“(b) The Borrowers will not, and will not permit any of their respective
Subsidiaries to: (i) declare or pay or make any forms of distribution to the
holders of their respective Equity Interests, or their successors or assigns,
other than (A) the Permitted Dividend, (B) the repurchase by RCM of 1,858,139
shares of RCM’s outstanding stock effective as of  June 2, 2020 (the “Permitted
2020 Stock Repurchase”), and (C)
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distributions constituting the repurchase of RCM’s outstanding stock, provided
that from and after December 12, 2014, the total amount of such distributions
(excluding the Permitted 2020 Stock Repurchase) shall not exceed $7,500,000.00,
in the aggregate; (ii) make any prepayments on any existing or future
Indebtedness for borrowed money to any Person without the prior written consent
of the Administrative Agent, which consent will not be unreasonably withheld,
except the Borrowers may prepay in full Indebtedness in the principal amount of
$2,229,766.80 incurred by RCM in connection with the consummation of the
Permitted 2020 Stock Repurchase on September 25, 2020; or (iii) hereafter borrow
money other than from the Lenders hereunder, except (A) in connection with
borrowed money giving rise to a Permitted Encumbrance under clause (o) of the
definition of Permitted Encumbrance, (B) in connection with Permitted
Acquisitions and Indebtedness evidenced by Sellers Notes subordinated on terms
and conditions reasonably acceptable to the Administrative Agent, and (C)
Indebtedness in the principal amount of $2,229,766.80 incurred by RCM in
connection with the consummation of the Permitted 2020 Stock Repurchase so long
as such Indebtedness is evidenced by documentation, and subordinated on terms
and conditions, acceptable to the Administrative Agent in its sole discretion.
Solely for purposes of this Section 7.7(b), any Earn-Out Obligation which may be
required to be paid by a Borrower shall not be considered to be “borrowed
money”.”

4. Amendment to Section 7.10(c) of Original Loan Agreement.  Section 7.10(c) of
the Original Loan Agreement is hereby amended and restated to read in its
entirety as follows:

“(c) Consolidated Total Funded Debt to Consolidated EBITDA Ratio:

(i) After March 31, 2018, but on or prior to June 30, 2018, the Consolidated
Total Funded Debt to Consolidated EBITDA Ratio shall at no time exceed 3.25 to
1.00.

(ii) After June 30, 2018, but on or prior to June 30, 2019, the Consolidated
Total Funded Debt to Consolidated EBITDA Ratio shall at no time exceed 3.00 to
1.00.

(iii) After June 30, 2019, but on or prior to December 31, 2019, the
Consolidated Total Funded Debt to Consolidated EBITDA Ratio shall at no time
exceed 4.00 to 1.00.

(iv) After December 31, 2019 but on or prior to March 31, 2020, the Consolidated
Total Funded Debt to Consolidated EBITDA Ratio shall at no time exceed 3.00 to
1.00.

(i)
After March 31, 2020 but on or prior to June 30, 2020, the Consolidated Total
Funded Debt to Consolidated EBITDA Ratio shall at no time exceed 5.00 to 1.00.

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(ii)
After June 30, 2020, but on or prior to September 30, 2020, the Consolidated
Total Funded Debt to Consolidated EBITDA Ratio shall at no time exceed 4.00 to
1.00.

(iii)
After September 30, 2020, the Consolidated Total Funded Debt to Consolidated
EBITDA Ratio shall at no time exceed 3.00 to 1.00.”

6. Amendment to Section 7.10(d) of the Original Loan Agreement. Section 7.10(d)
of the Original Loan Agreement is hereby amended to read in its entirety as
follows:

“(d) Modified Current Ratio:

     (i)     The ratio of (A) 0.75 multiplied by the net book value of the
Borrowers’ accounts receivable (as determined in accordance with GAAP), to (B)
the Total Revolving Outstandings shall at no time after March 31, 2020 but prior
to September 30, 2020 be less than 1.10 to 1.00; and

     (ii)     The ratio of (A) 0.75 multiplied by the net book value of the
Borrowers’ accounts receivable (as determined in accordance with GAAP), to (B)
the Total Revolving Outstandings shall not be less than 1.25 to 1.00 on
September 30, 2020.”

7. Amendment to Exhibit D to Original Loan Agreement.  Exhibit D attached to the
Original Loan Agreement is hereby replaced, in its entirety, with the form of
Compliance Certificate attached hereto as Schedule I.

8. Reaffirmation.  Pursuant to the terms of the Original Pledge and Security
Agreement, the Borrowers have provided to the Agent, for the benefit of the
Lenders, as security for the payment and performance of any and all of the
Secured Obligations and the performance of all other obligations and covenants
of Borrowers under the Original Loan Agreement, the Existing Restated Credit
Note, and each other Loan Document, certain or contingent, now existing or
hereafter arising, which are now, or may at any time or times hereafter be owing
by any Borrower to the Agent or the Lenders, a first priority, perfected
security interest in the Collateral.  Each Borrower hereby ratifies and confirms
the liens and security interests granted under Original Pledge and Security
Agreement; and further ratifies and confirms, without condition, that (a) such
liens and security interests shall secure the payment and performance of any and
all of the Obligations and the performance of all other obligations and
covenants of any Borrower under the Loan Agreement, the Existing Restated Credit
Note, and each other Loan Document, certain or contingent, now existing or
hereafter arising, which are now, or may at any time or times hereafter be owing
by any Borrower to the Agent or the Lenders, and (b) the perfected status and
priority of such liens and security interests shall not be affected in any way
by the amendments to the Original Loan Agreement set forth herein.  Each
Borrower acknowledges that the outstanding principal amount of the Existing
Restated Credit Note is due and owing without any claim, defense or set-off.
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9. Representations and Warranties.  Each Borrower hereby confirms that the
representations and warranties set forth in the Original Loan Agreement remain
true and correct in all material respects.  Each Borrower also represents and
warrants that (a) no Default or Event of Default is presently outstanding under
any of the terms and conditions of the Original Loan Agreement; (b) each
Borrower has full power and authority to execute, deliver, and perform its
obligations under this Agreement and under any document or instrument executed
in connection with this Agreement; (c) the execution, delivery, and performance
of this Agreement and of any document or instrument executed in connection with
this Agreement will not violate any provision of any existing law or regulation
applicable to any Borrower, any provision of its governing organizational
documents, any order or decree of any court, arbitrator or governmental
authority, or any contractual undertaking to which it is a party or by which it
may be bound; (d) no consents, licenses, approvals or authorizations of,
exemptions by or registrations or filings with, any governmental authority are
required with respect to this Agreement or any of the documents or instruments
executed by a Borrower in connection herewith; and (e) this Agreement
constitutes the legal valid and binding obligations of each Borrower,
enforceable in accordance with its terms.  All representations, warranties and
covenants of the Borrowers, whether hereunder, or contained in the Original Loan
Agreement or the other Loan Documents, shall remain in full force and effect
until all amounts due under the Original Loan Agreement, as amended herein, the
Existing Restated Credit Note and each other Loan Document, are satisfied in
full.

10. Complimentary Nature of Documents.  Except as modified by the terms hereof,
all terms, provisions and conditions of the Original Loan Agreement and each
other Loan Document are in full force and effect and are hereby incorporated by
reference as if set forth herein.  This Amendment and the Original Loan
Agreement shall be deemed as complementing and not restricting the Agent’s or
the Lender’s rights hereunder or thereunder.  If there is any conflict or
discrepancy between the provisions of this Amendment and any provision of the
Original Loan Agreement, the terms and provisions of this Amendment shall
control and prevail.

11. Effectiveness Conditions.  This Amendment shall be effective upon execution
of this Amendment by all parties hereto.

12. Release of Claims.  In consideration of the benefits provided to the
Borrowers under the terms and provisions hereof, each Borrower hereby agrees as
follows ("General Release"):

(a) Each Borrower, for itself and on behalf of its successors and assigns, does
hereby release, acquit and forever discharge the Agent and the Lender, all of
their respective predecessors in interest, and all of their respective past and
present officers, directors, attorneys, affiliates, employees and agents, of and
from any and all claims, demands, obligations, liabilities, indebtedness,
breaches of contract, breaches of duty or of any relationship, acts, omissions,
misfeasance, malfeasance, causes of action, defenses, offsets, debts, sums of
money, accounts, compensation, contracts, controversies, promises, damages,
costs, losses and expenses, of every type, kind, nature, description or
character, whether known or unknown, suspected or unsuspected, liquidated or
unliquidated, each as though fully set forth herein at length (each, a "Released
Claim" and collectively, the "Released Claims"), that any Borrower now has or
may

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acquire as of the date that the Borrowers have executed and delivered this
Amendment to the Agent (hereafter, the "Release Date"), including without
limitation, those Released Claims in any way arising out of, connected with or
related to any and all prior credit accommodations, if any, provided by the
Agent or the Lender, or any of their respective predecessors in interest, to any
Borrower, and any agreements, notes or documents of any kind related thereto or
the transactions contemplated thereby or hereby, or any other agreement or
document referred to herein or therein.

(b) Each Borrower hereby acknowledges, represents and warrants to the Agent and
the Lender that it agrees to assume the risk of any and all unknown,
unanticipated or misunderstood Released Claims which are released by the
provisions of this General Release in favor of the Agent and the Lender, and
each Borrower hereby waives and releases all rights and benefits which it might
otherwise have under any state or local laws or statutes with regard to the
release of such unknown, unanticipated or misunderstood Released Claims.

(c) Each person signing below on behalf of a Borrower acknowledges that he or
she has read each of the provisions of this General Release.  Each such person
fully understands that this General Release has important legal consequences,
and each such person realizes that they are releasing any and all Released
Claims that any Borrower may have as of the Release Date.  Each Borrower hereby
acknowledges that it has had an opportunity to obtain an attorney’s advice
concerning the legal consequences of each of the provisions of this General
Release.

(d) Each Borrower hereby specifically acknowledges and agrees that:  (i) none of
the provisions of this General Release shall be construed as or constitute an
admission of any liability on the part of the Agent or the Lender; (ii) the
provisions of this General Release shall constitute an absolute bar to any
Released Claim of any kind, whether any such Released Claim is based on
contract, tort, warranty, mistake or any other theory, whether legal, statutory
or equitable; and (iii) any attempt to assert a Released Claim barred by the
provisions of this General Release shall subject a Borrower to the provisions of
applicable law setting forth the remedies for the bringing of groundless,
frivolous or baseless claims or causes of action.

13. Counterparts; Electronic Signature.  This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.  Delivery of an
executed signature page counterpart hereof by telecopy, emailed pdf. or any
other electronic means that reproduces an image of the actual executed signature
page shall be effective as delivery of a manually executed counterpart hereof.
The words “execution,” “signed,” “signature,” “delivery,” and words of like
import in or relating to any document to be signed in connection with this
Agreement and the transactions contemplated hereby shall be deemed to include
electronic signatures, the electronic association of signatures and records on
electronic platforms,  deliveries or the keeping of records in electronic form,
each of which shall be of the same legal effect, validity or enforceability as a
manually executed signature, physical delivery thereof or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as
provided for in any applicable law, including the Federal Electronic Signatures
in Global and National Commerce Act, the New York State Electronic Signatures
and Records Act, any other similar state laws based on the Uniform

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Electronic Transactions Act or the Uniform Commercial Code, each as amended, and
the parties hereto hereby waive any objection to the contrary, provided that (x)
nothing herein shall require the Agent or the Lender to accept electronic
signature counterparts in any form or format and (y) the Agent and the Lender
reserve the right to require, at any time and at its sole discretion, the
delivery of manually executed counterpart signature pages to this Agreement and
the parties hereto agree to promptly deliver such manually executed counterpart
signature pages.

14. Successors and Assigns.  This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
(except that a Borrower may not assign or transfer its rights hereunder), and no
other parties shall be a beneficiary hereunder.

15. Miscellaneous.  This Amendment (a) shall be construed and enforced in
accordance with the laws of the Commonwealth of Pennsylvania; and (b) may only
be amended or modified pursuant to a writing signed by the parties hereto.  If
any provision hereof is in conflict with any statute or rule of law of the
Commonwealth of Pennsylvania or any other statute or rule of law of any other
applicable jurisdiction or is otherwise unenforceable, such provisions shall be
deemed null and void only to the extent of such conflict or unenforceability and
shall be deemed separate from and shall not invalidate any other provision of
this Agreement.

16. WAIVER OF JURY TRIAL.  EACH BORROWER HEREBY WAIVES ANY AND ALL RIGHTS WHICH
IT MAY HAVE TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION COMMENCED BY OR
AGAINST THE AGENT OR THE LENDER WITH RESPECT TO THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HERETO.

17. Reimbursement of Costs.  The Borrowers hereby jointly and severally agree
that they will pay, or cause to be paid or reimburse the Agent and the Lender
for, all of costs and expenses incurred by them in connection with this
Amendment, including without limitation the fees of their legal counsel.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the undersigned have caused this Amendment to be executed
and delivered by their respective officers thereunto duly authorized, as of the
29th day of September, 2020.

BORROWERS:
RCM TECHNOLOGIES, INC.

 
By:
/s/ Kevin D. Miller
 
Print Name:
 Kevin D. Miller  
Title:
 CFO  

RCM TECHNOLOGIES (USA), INC.

 
By:
/s/ Kevin D. Miller  
Print Name:
 Kevin D. Miller  
Title:
 CFO  

RCMT DELAWARE, INC.

 
By:
/s/ Kevin D. Miller  
Print Name:
 Kevin D. Miller  
Title:
 CFO  

RCM TECHNOLOGIES CANADA CORP.

 
By:
/s/ Kevin D. Miller  
Print Name:
 Kevin D. Miller  
Title:
 CFO  

RCM EUROPE HOLDINGS, INC.

 
By:
/s/ Kevin D. Miller  
Print Name:
 Kevin D. Miller  
Title:
 CFO

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AGENT:
CITIZENS BANK, N.A.,
as Administrative Agent and Arranger

 
By:
 /s/ Lisa S. Williams
 
Print Name:
 Lisa S. Williams  
Title:
 SVP
LENDERS:

CITIZENS BANK, N.A., as Lender

 
By:
 /s/ Lisa S. Williams  
Print Name:
 Lisa S. Williams  
Title:
 SVP

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SCHEDULE I

See attached.

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RCM Technologies,
Inc.                                                                                                                 
As Amended 09/29/2020

LOC Covenant Compliance
As of __________, 20__

($ in thousands)

General Financial Data
 
 
 
 
 
 
Funded Debt
 
 
 
Cash on balance sheet as of last day of fiscal period
 
 
Determination of Actual EBITDA for relevant Measurement Period*
 
 
 
(i)
Operating Income
 
 
 
(ii)
Depreciation & Amortization
 
 
Add:
(ii)
Non-Cash Charges, Equity Based Compensation
 
 
Add:
(iii)
Net loss if any arising solely from Permitted Asset or Stock
Sales (up to an amount, which when added to other net
losses previously recognized does not exceed
$5,000,000 in the aggregate)
 
 
Add:
Nonrecurring charges waiver
 
 
 
 
 
 
 
 
Actual EBITDA Acquired
 
 
 
 
 
 
 
 
 
EBITDA
 
 
 
 
TKE
 
 
 
 
 
 
 
 
 
Total EBITDA for relevant Measurement Period
 
 
 
 
 
 
 
 *Relevant Measurement Periods are as follows:
 
 
 
 
-
Trailing twelve months ("LTM") for quarters ended
prior to December 31, 2020 or after June 30, 2021)
 
   
 
 
 
 
 
-
For quarter ended December 31, 2020,three months
ended December 31, 2020 times four
 
   
 
 
 
 
 
-
For quarter ended March 31, 2021, six months ended
March 31, 2021 times two
 
   
 
 
 
 
 
-
For quarter ended June 30, 2021, nine months ended
June 30, 2021 divided by three, with the result
multiplied by four
 
 
 
 
 
 
 
7.10 (a) Fixed Charge Ratio
 
 
 
 
 
 
 
 EBITDA
 
 
 
 
 
 
 
 
 
-
LTM (for quarters ended prior to December 31, 2020
or after June 30, 2021)
 
   
 
 
 
 
 
-
For quarter ended December 31, 2020, EBITA for
three months ended December 31, 2020 times four
 
   
 
 
 
 
 
-
For quarter ended March 31, 2021, EBITDA for six
months ended March 31, 2021 times two
 
   
 
 
 
 
 
-
For quarter ended June 30, 2021, EBITDA for nine
months ended June 30, 2021 divided by three, with the
result multiplied by four
 
 
 
 
 
 
 
 
 
Divided By LTM:
 
 
 
 
 
Interest Paid
 
 
 
 
Income Taxes Paid
 
 
 
 
Scheduled Principal Payments
 
 
 
 
Capex
 
 
 
 
Dividends Paid
 
 
 
 
Total
 
 
 
 
 
 
 
 
 
Actual Fixed Charge Ratio
 
 
 
 
 
 
 
Minimum Fixed Charge Ratio
1.50 to 1.00
 
 
 
 
 
 
 
 
Compliance
Yes_____
No_____
 
 
 
 
 
 
7.10 (b) Capital Expenditures
 
 
 
 
 
 
 
 
 
Actual Capex LTM
 
 
 
Purchase Money Financing
 
 
 
 
Total
 
 
 
Maximum Capex
$5,000
 
 
 
 
 
 
 
 
Compliance
Yes_____
No_____
 
 
 
 
 
 
7.10 (c) Total Funded Debt to EBITDA
 
 
 
 
 
 
 
 
 
Total Funded Debt
 
 
 
Cash on balance sheet as of last day of fiscal period,
 
 
 
Max $2M
 
 
 
 
 
 
 
 
 
EBITDA
 
 
 
 
 
 
 
 
 
-
LTM (for quarters ended prior to December 31, 2020
or after June 30, 2021)
 
 
   
 
 
 
 
 
-
For quarter ended December 31, 2020, EBITA for
three months ended December 31, 2020 times four
 
 
   
 
 
 
 
 
-
For quarter ended March 31, 2021, EBITDA for six
months ended March 31, 2021 times two
 
 
   
 
 
 
 
 
-
For quarter ended June 30, 2021, EBITDA for nine
months ended June 30, 2021 divided by three, with the
result multiplied by four
 
 
 
 
 
 
 
 
 
Actual Funded Debt (less cash on balance sheet up to maximum of
   $2,000) to EBITDA
 
 
 
 
 
 
 
Maximum Funded Debt to EBITDA
 
 
 
 
 
 
 
 
 
Compliance
 
Yes_____
No_____
7.10 (d) Modified Current Ratio (not applicable for quarters ended after
September 30, 2020)
 
 
 
 
 
 
 
 
 
Total Net Accounts Receivable
 
 
 
0.75 times Total Net Accounts Receivable
 
 
 
 
 
 
 
 
 
Total Revolving Outstandings
 
 
 
 
 
 
 
 
 
Actual Current Ratio
 
 
 
 
 
 
 
Minimum Current Ratio Required
 
 
 
 
 
 
 
 
 
Compliance
Yes_____
No_____