|
Nevada
(State or Other
Jurisdiction of
Incorporation)
|
1-10245
(Commission File
Number)
|
95-1480559
(I.R.S. Employer
Identification No.)
|
|
2500 McClellan Avenue, Suite 350
|
||
|
Pennsauken, NJ
|
08109-4613
|
|
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
|
☐
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425).
|
|
☐
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12).
|
|
☐
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b)).
|
|
☐
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240-13e-4(c)).
|
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
||
|
Common Stock, par value $0.05 per share
|
RCMT
|
The NASDAQ Stock Market LLC
|
|
●
|
the Board authorized the increase of the Company’s existing At-the-Market Offering Program for which B. Riley Securities, Inc. acts as agent. As increased, the Company may now offer and sell, from time to time through B. Riley, shares of the Company’s Common Stock, $0.05 par value per share (the “Common Stock”), having an aggregate offering price of up to $17.9 million, increased from $11.4 million. The Company has filed with the Securities and Exchange Commission a prospectus supplement, dated November 12, 2021, to describe the increase, which supersedes and replaces the May 5, 2021 prospectus supplement.
|
|
●
|
the Board authorized an increase to its existing program to repurchase shares of the Common Stock, such that, giving effect to the increase and including the amount remaining under the Board’s initial authorization of $7.5 million, the Company has the capacity, as of the date hereof, to purchase an additional $12.55 million of shares. The program is designed to provide the Company with enhanced flexibility over the long term to optimize its capital structure. Shares of the Common Stock may be repurchased in the open market or through negotiated transactions. The program may be terminated or suspended at any time at the discretion of the Company. The Company may in the future enter into a Rule 10b5-1 trading plan to effect a portion of the authorized purchases, if criteria set forth in the plan are met. Such a plan would enable the Company to repurchase its shares during periods outside of its normal trading windows, when the Company typically would not be active in the market.
|
|
Exhibit Number
|
|
|
Opinion of Brownstein Hyatt Farber Schreck, LLP.
|
|
|
Amendment No. 4 to Third Amended and Restated Loan Agreement, dated as of November 12, 2021, by and among RCM Technologies, Inc., all of the subsidiaries of RCM Technologies, Inc. and Citizens Bank, N.A., a national banking association (as successor by merger to Citizens Bank of Pennsylvania), in its capacities as lender and as administrative agent and arranger.
|
|
|
Consent of Brownstein Hyatt Farber Schreck, LLP (included in Exhibit 5.1).
|
|
By:
|
/s/ Kevin D. Miller
|
|
Kevin D. Miller
|
|
|
Chief Financial Officer, Treasurer and
Secretary
|
Brownstein Hyatt Farber Schreck, LLP
702.382.2101 main
100 North City Parkway, Suite 1600
Las Vegas, Nevada 89106
November 12, 2021
R C M Technologies, Inc.
2500 McClellan Avenue, Suite 350
Pennsauken, NJ 08109
To the addressee set forth above:
We have acted as local Nevada counsel to R C M Technologies, Inc., a Nevada corporation (the “Company”), in connection with the potential issuance and sale by the Company from time to time of shares (the “Shares”) of the Company’s common stock, par value $0.05 per share (the “Common Stock”), pursuant to that certain At Market Issuance Sales Agreement, dated as of May 5, 2021 (the “Sales Agreement”), by and between B. Riley Securities, Inc., as sales agent (in such capacity, the “Agent”), and the Company, all as more fully described in the Registration Statement on Form S-3 (File No. 333-252148) (as amended through the date hereof, the “Registration Statement”), including the base prospectus contained therein, as supplemented by the prospectus supplement dated November 12, 2021 (as so supplemented, the “Prospectus”), as filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Act”). This opinion letter is being furnished at your request in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Act.
In our capacity as such counsel, we are familiar with the proceedings taken and proposed to be taken by the Company in connection with the authorization, issuance and sale of the Shares as contemplated by the Sales Agreement and as described in the Registration Statement and the Prospectus. For purposes of this opinion letter, and except to the extent set forth in the opinion below, we have assumed that all such proceedings have been or will be timely completed in the manner presently proposed in the Sales Agreement and the Registration Statement and the Prospectus.
For purposes of issuing this opinion letter, we have made such legal and factual examinations and inquiries, including an examination of originals or copies certified or otherwise identified to our satisfaction as being true copies of (i) the Registration Statement and the Prospectus, (ii) the Sales Agreement, (iii) the articles of incorporation and bylaws of the Company; and (iv) such agreements, instruments, resolutions of the board of directors of the Company or committees thereof, and other corporate records, and such other documents as we have deemed necessary or appropriate for the purpose of issuing this opinion letter, and we have obtained from officers and other representatives and agents of the Company and from public officials, and have relied upon, such certificates, representations and assurances, and public filings, as we have deemed necessary or appropriate.
R C M Technologies, Inc.
November 12, 2021
Page 2
Without limiting the generality of the foregoing, in our examination, we have, with your permission, assumed without independent verification: (i) the statements of fact and all representations and warranties set forth in the documents we have reviewed are true and correct as to factual matters, in each case as of the date or dates of such documents and as of the date hereof; (ii) each natural person executing any of the documents we have reviewed has sufficient legal capacity to do so; (iii) all documents submitted to us as originals are authentic, the signatures on all documents that we have reviewed are genuine and all documents submitted to us as certified, conformed, photostatic, facsimile or electronic copies conform to the original document; (iv) all corporate records made available to us by the Company, and all public records we have reviewed, are accurate and complete; (v) the obligations of each party set forth in the Sales Agreement are its valid and binding obligations, enforceable in accordance with its terms; and (vi) after any issuance of Shares, the total number of issued and outstanding shares of Common Stock, together with the total number of shares of Common Stock then reserved for issuance or obligated to be issued by the Company pursuant to any agreement or arrangement or otherwise, will not exceed the total number of shares of Common Stock then authorized under the Company’s articles of incorporation.
We are qualified to practice law in the State of Nevada. The opinion set forth herein are expressly limited to and based exclusively on the general corporate laws of the State of Nevada, and we do not purport to be experts on, or to express any opinion with respect to the applicability or effect of, the laws of any other jurisdiction. We express no opinion concerning, and we assume no responsibility as to laws or judicial decisions related to, or any orders, consents or other authorizations or approvals as may be required by, any federal laws, rules or regulations, including, without limitation, any federal securities laws, rules or regulations, or any state securities or “blue sky” laws, rules or regulations.
Based upon the foregoing and in reliance thereon, and having regard to legal considerations and other information that we deem relevant, we are of the opinion that if, when and to the extent any Shares are issued and sold in accordance with the terms and conditions of, and in the manner contemplated by, the Sales Agreement, including payment in full to the Company of the consideration for such Shares as required thereunder, and in accordance with the proceedings described in, and in the manner contemplated by, the Registration Statement and Prospectus, such Shares will be validly issued, fully paid and nonassessable.
The opinion expressed herein are based upon the applicable laws of the State of Nevada and the facts in existence on the date hereof. In delivering this opinion letter to you, we disclaim any obligation to update or supplement the opinion set forth herein or to apprise you of any changes in any laws or facts after the later of the date hereof and the filing date of the Prospectus Supplement. No opinion is offered or implied as to any matter, and no inference may be drawn, beyond the strict scope of the specific issues expressly addressed by the opinion set forth herein.
R C M Technologies, Inc.
November 12, 2021
Page 3
We hereby consent to the filing of this opinion letter as an exhibit to the Registration Statement and the Prospectus, and to the reference to our firm therein under the heading “Legal Matters”. In giving such consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission promulgated thereunder.
Very truly yours,
/s/ Brownstein Hyatt Farber Schreck, LLP
AMENDMENT NO. 4 TO THIRD AMENDED
AND RESTATED LOAN AGREEMENT
This Amendment No. 4 to Third Amended and Restated Loan Agreement, dated as of November 12, 2021 (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, that certain Amendment No. 2 to Third Amended and Restated Loan Agreement, dated as of June 2, 2020, and that certain Amendment No. 3 to Third Amended and Restated Loan Agreement, dated as of September 26, 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”).
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 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”);
(C) distributions constituting the repurchase of RCM’s outstanding stock made on or after December 12, 2014 but prior to October 3, 2021 so long as the total amount of such distributions (excluding the Permitted 2020 Stock Repurchase) does not exceed $7,500,000.00, in the aggregate; and
(D) distributions constituting the repurchase of RCM’s outstanding stock made on or after October 3, 2021 so long as (1) the total amount of such distributions does not exceed $15,000,000.00, in the aggregate, (2) at the time any such distribution is made there is no Default or Event of Default outstanding, (3) after giving effect to any such distribution on a Pro Forma Basis no Default or Event of Default would be outstanding, and (4) after giving effect to any such distribution on a Pro Forma Basis the Total Revolving Outstandings would be less than seventy-five percent (75%) of the aggregate Revolving Commitments;
(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”.”
3. 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.
4. 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.
5. 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.
6. Effectiveness Conditions. This Amendment shall be effective upon execution of this Amendment by all parties hereto.
7. 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 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.
8. 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 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.
9. 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.
10. 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.
11. 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.
12. 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]
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be executed and delivered by their respective officers thereunto duly authorized, as of the 12th day of November, 2021.
|
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 |
|
|
RCMT EUROPE HOLDINGS, INC.
|
||
|
By: |
/s/ Kevin D. Miller |
|
|
Print Name: |
Kevin D. Miller |
|
|
Title: |
CFO |
|
|
AGENT: |
CITIZENS BANK, N.A.,
|
|
|
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 | |