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Item 9A. Controls and Procedures

2024-03-15 compared with 2023-03-16 · 175 added, 114 removed, 530 unchanged (35% of the section changed)

7 unchanged sentences

The Company’s internal control system was designed to provide reasonable assurance to management and the Company’s Board of Directors regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of January 1, 2023, using criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and concluded that the Company maintained effective internal control over financial reporting as of January 1, 2023.

Consistent with guidance issued by the Securities and Exchange Commission on recently acquired businesses, management’s assessment of the effectiveness of internal controls over financial reporting, with respect thereto may be omitted.

As of December 31, 2023, management has excluded Arroyo Consulting from the assessment of internal controls over financial reporting.

Arroyo Consulting was acquired by the Company in a purchase business combination during Fiscal 2023 whose total assets and revenues excluded from management's assessment and our audit of Internal Control Over Financial Reporting represent 10.9% and 4.7%, respectively, of the related consolidated financial statements as of and for the year ended December 31, 2023.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023, using criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and concluded that the Company maintained effective internal control over financial reporting as of December 31, 2023.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

The effectiveness of our internal control over financial reporting as of January 1, 2023, has been audited by Whitley Penn LLP, an independent registered public accounting firm, as stated in their report which is included herein.

The effectiveness of our internal control over financial reporting as of December 31, 2023, has been audited by Whitley Penn LLP, an independent registered public accounting firm, as stated in their report which is included herein.

Changes in Internal Control Over Financial Reporting

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Opinion on Internal Control Over Financial Reporting

We have audited BGSF, Inc.'s and its subsidiaries (the “Company”) internal control over financial reporting as of January 1, 2023, based on criteria established in 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of January 1, 2023, based on criteria established in 2013 Internal Control— Integrated Framework issued by COSO.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company, as of January 1, 2023 and December 26, 2021, and the related consolidated statements of operations and comprehensive income, changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended January 1, 2023, and the related notes (collectively referred to as the “consolidated financial statements”), and our report dated March 15, 2023 expressed an unqualified opinion on those consolidated financial statements.

We have audited BGSF, Inc.’s and its subsidiaries (the “Company”) internal control over financial reporting as of December 31, 2023, based on criteria established in 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in 2013 Internal Control— Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company, as of December 31, 2023 and January 1, 2023, and the related consolidated statements of operations and comprehensive (loss) income, changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes (collectively referred to as the “consolidated financial statements”), and our report dated March 14, 2024 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting .

The Company’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting .

Our responsibility is to express an opinion on the entity’s internal control over financial reporting based on our audit.

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We believe that our audit provides a reasonable basis for our opinion.

As described in Management’s Report on Internal Control Over Financial Reporting, management has excluded the Arroyo Consulting, LLC business from its assessment of internal control over financial reporting as of December 31, 2023 because it was acquired by the Company in a purchase business combination during fiscal 2023.

We have also excluded the Arroyo Consulting, LLC business from our audit of internal control over financial reporting.

The Arroyo Consulting, LLC business is a wholly-owned subsidiary whose total assets and total revenues excluded from management’s assessment and our audit of internal control over financial reporting represent approximately 10.9% and 4.7%, respectively, of the related consolidated financial statement amounts as of and for the year ended December 31, 2023.

Definition and Limitations of Internal Control Over Financial Reporting

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/s/ Whitley Penn LLP

Dallas, Texas

March 14, 2024

Other Information.

Trading Plans

During the three months ended December 31, 2023, no director or Section 16 officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Disclosure Regarding Foreign Jurisdictions That Prevent Inspections

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Board Composition

Our Board of Directors (the “Board”) consists of six directors.

Our Board consists of seven directors.

Our Board has determined that the following directors are “independent” as defined under the rules of the NYSE:

David Allen, Jr., Richard L.

Baum, Jr., Douglas E.

Baum, Donna Carroll, Jr., Douglas E.

Hailey, Cynthia Marshall, and Paul A.

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Our Board is divided into three classes, each serving staggered, three-year terms:

• Our Class I director is Beth Garvey, and her term will expire at the 2024 annual meeting of stockholders;

• Our Class I directors are Beth Garvey and Donna Carroll.

The terms of each director will expire at the 2024 annual meeting of stockholders;

• Our Class II directors are Richard L.

Baum, Jr., Cynthia Marshall,, and Paul A.

Seid, and the term of each director will expire at the 2025 annual meeting of stockholders;

The terms of each director will expire at the 2025 annual meeting of stockholders;

• Our Class III directors are C.

1 unchanged sentence

and Douglas E.

Hailey the term of each director will expire at the 2023 annual meeting of stockholders.

Hailey.The terms of each director will expire at the 2026 annual meeting of stockholders.

As a result, only one class of directors will be elected at each annual meeting of stockholders, with the other classes continuing for the remainder of their respective terms.

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David Allen, Jr., Richard L.

and Douglas E.

Baum, Jr., Donna Carroll and Douglas E.

We believe that each qualifies as independent directors according to the rules and regulations of the SEC and NYSE with respect to audit committee membership.

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David Allen, Jr., Richard L.

Baum, Jr., Cynthia Marshall, and Paul A.

Baum, Jr., Cynthia Marshall, Donna Carroll and Paul A.

Our Board has adopted a written charter for the Compensation Committee, which is available on our home office website under the investor relations tab at www.bgsf.com.

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Prior to Graebel, from 2009 to 2015, Mr.

Allen served as an officer of Snelling Services, LLC, a workforce solutions and contract provider.

Allen served as an officer of Snelling Services, LLC, a workforce solutions provider.

From 2010 to 2015, Mr.

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served on the board of managers of LTN Acquisition, LLC (the former parent of the predecessor to BGSF, Inc.) since its inception and was appointed to serve on our Board in November 2013.

Since March 2013, Mr.

Baum has been Chairman of the Board of Unique Fabricating, Inc.

(NYSE American:

Baum joined Taglich Private Equity LLC in 2005 and currently is an active director with a number of private companies where Taglich has an investment.

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Baum's perspective and experience with our ongoing operations and strategy that he has obtained through his prolonged service to the company and due to his ability to assist with the evaluation of potential acquisitions.

Donna Carroll

Independent Director

Director Since:

Committees Served:

Audit Committee, Compensation Committee

Carroll has served as the Founder and President of Human Factor, LLC, a provider of advisory, consulting, and leadership development services to public sector and non-profit organizations since July 2020.

From January 2017 to July 2020, Ms.

Carroll served, among other roles, as Chief Sales Officer of Supplemental Health Care, a private healthcare staffing and professional services company.

Carroll is also member of the Board of Directors of Champions Community Foundation, Inc., on the Leadership Advisory Council of the Women Business Collaborative, and a former advisory Board member of Phaidon International.

She attended Kalamazoo Valley Community College and holds a Certificate in Leading Change and Organizational Leadership from the University of Georgia – Terry College of Business, and a Certificate in the Future of Work:

Leading Modern Workplaces through the Wharton School of the University of Pennsylvania.

Additionally, she is a Certified Professional Coach and COR.E Dynamics | Leadership Dynamics Specialist.

Our Board benefits from Ms.

Carroll’s substantial experience in the professional services and staffing industry.

Chair, President and Chief Executive Officer

Director Since:

Beth Garvey began serving as President and Chief Executive Officer of the Company in October 2018.

Garvey previously served as Chief Operating Officer of the Company from August 2016 and joined the Company through the Company's acquisition of substantially all of the assets of InStaff Holding Corporation and InStaff Personnel, LLC (“InStaff”) in 2013.

Garvey started at InStaff in 1998 as Director of Human Resources, subsequently serving as Director of Operations, VP of

Operations, Senior VP of Operations, COO and ultimately CEO prior to our acquisition.

The Staffing Industry Analysts has recognized her as one of North America Staffing 100 for the previous 3 years and included her in the Global Power 150 – Women in Staffing list for the past 4 years.

In addition, D CEO has named Ms.

Garvey as one of the top Dallas 500 Business Leaders 4 times.

Garvey was a Dallas Business Journal ‘Women in Business’ honoree recognizing outstanding local women business leaders who not only make a difference in their industries, but also in their communities.

Beth currently serves on the Board of Directors of the National Association of Corporate Directors in North Texas, Junior Achievement of Dallas, and the Board of Directors of the Dallas Regional Chamber, where she is a member of the DEI Diversity Leadership Sub-Council, prior co-chair of the Talent Attraction committee.

She is a past chair of the Executive Committee for the Dallas Executive Women’s Roundtable.

She is a member of YTexas and founding Board Member of the YTexas Foundation an initiative of Texas CEOs to help advance workforce development initiatives for students and veterans in the State of Texas.

In addition, she is a member of the Leadership Committee for the Dallas 50/50 Women on Boards.

Garvey was named as a finalist in the EY Entrepreneur of the Year® 2020 Award for the Southwest region.

Beth Garvey assumed the role of President and Chief Executive Officer of the Company in October 2018, having previously served as Chief Operating Officer since August 2016.

She joined the Company through the acquisition of substantially all of the assets of InStaff Holding Corporation and InStaff Personnel, LLC (“InStaff”) in 2013, where she began her career in 1998 as Director of Human Resources and later became CEO.

Garvey has been consistently recognized by the Staffing Industry Analysts as a top figure in North America Staffing 100 list for five years and has been included in the Global Power 150 – Women in Staffing list for the past six years.

Additionally, D CEO has lauded her as one of the top Dallas 500 Business Leaders on seven occasions, while the Dallas Business Journal honored her with the ‘Women in Business’ award for her significant industry and community impact.

Garvey achievements were further underscored when she emerged as a finalist in the EY Entrepreneur of the Year® 2020 Award for the Southwest region.

Currently, she serves on the Board of Directors of the National Association of Corporate Directors in North Texas and holds the Chair position at Junior Achievement of Dallas.

As a Board Member of the Dallas Regional Chamber, she currently serves as a member of the DEI Diversity Leadership Sub-Council and has previously co-chaired the Talent Attraction committee.

Garvey has held leadership roles in various organizations, including chairing the Executive Women’s Roundtable and participating in the International Women’s Forum.

Additionally, she contributes as a board member of Business Council for the Arts and is actively involved in the Leadership Committee for the Dallas 50/50 Women on Boards initiative.

Garvey’s extensive experience in the workforce solutions industry combined with her steadfast commitment to community impact positions her as a catalyst for positive change within the Company.

Our Board benefits from Ms.

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Beth Garvey 58 Chair, President and Chief Executive Officer

Dan Hollenbach 67 Chief Financial Officer and Secretary

Beth Garvey began serving as President and Chief Executive Officer of the Company in October 2018.

Garvey started at InStaff in 1998 as Director of Human Resources, subsequently serving as Director of Operations, VP of Operations, Senior VP of Operations, COO and ultimately CEO prior to our acquisition.

The Staffing Industry Analysts has recognized her as one of North America Staffing 100 for the previous 2 years and included her in the Global Power 150 – Women in Staffing list for the past 3 years.

In addition, D CEO has named Garvey as one of the top Dallas 500 Business Leaders 4 times.

She is a past chair of the Executive Committee for the Dallas Executive Women’s Roundtable.

In addition, she is a member of the Leadership Committee for the Dallas 50/50 Women on Boards.

Garvey was named as a finalist in the EY Entrepreneur of the Year® 2020 Award for the Southwest region.

Dan Hollenbach joined as CFO and Secretary in August 2015.

John Barnett 57 Chief Financial Officer and Secretary

Beth Garvey assumed the role of President and Chief Executive Officer of the Company in October 2018, having previously served as Chief Operating Officer since August 2016.

Garvey achievements were further underscored when she emerged as a finalist in the EY Entrepreneur of the Year® 2020 Award for the Southwest region.

Currently, she serves on the Board of Directors of the National Association of Corporate Directors in North Texas and holds the Chair position at Junior Achievement of Dallas.

As a Board Member of the Dallas Regional Chamber, she currently serves as a member of the DEI Diversity Leadership Sub-Council and has previously co-chaired the Talent Attraction committee.

Garvey has held leadership roles in various organizations, including chairing the Executive Women’s Roundtable and participating in the International Women’s Forum.

Additionally, she contributes as a board member of Business Council for the Arts and is actively involved in the Leadership Committee for the Dallas 50/50 Women on Boards initiative.

Garvey’s extensive experience in the workforce solutions industry combined with her steadfast commitment to community impact positions her as a catalyst for positive change within the Company.

John Barnett joined as Chief Financial Officer and Secretary in March 2023.

Prior to joining the Company, Mr.

Hollenbach was the CFO of Cybergy Holdings, Inc.

CYBG), an advisory service and products company for the federal and state governments, and commercial client partners, from May 2014 to August 2015.

Prior to this position, he led the consulting practice for Robert Half Management Resources in Colorado from June 2010 to May 2014.

From August 2004 to July 2009, Dan was the CFO for Global Employment Holdings (OTC:

GEYH), a national workforce solution, consulting, and professional employer organization company.

Hollenbach began his career in the Audit and Assurance Services practice of EY before entering the corporate world.

He has over three decades of experience in corporate accounting and finance, including expertise in initial public offerings, SEC reporting, mergers and acquisitions, Sarbanes-Oxley, treasury management, process improvement, and all phases of audit, tax, and reporting.

Additionally, he has served on audit committees and led negotiations of multiple senior debt restructurings.

He is a CPA in the State of Texas, holds a Chartered Global Management Accountant certification, and received his B.B.A.

in accounting from Texas Tech University.

Barnett served as Chief Financial Officer of Protective Insurance (NASDAQ:

PTVC) from October 2019 to February 2022 and as Chief Financial Officer of First Acceptance (NYSE:

FAC) from November 2018 to September 2019.

He also served in senior leadership roles for both Broadcast Music, Inc.

and Anheuser-Busch.

Barnett earned a Bachelor of Science degree from the U.S.

Military Academy at West Point, a Master of Science in Engineering Management from Missouri University of Science and Technology, and an MBA from the University of Illinois Urbana-Champaign.

Early in his career, Barnett served in the U.S.

Army advancing to the rank of Captain.

Code of Ethics

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The information on our website is not part of this Annual Report on Form 10-K.

Section 16(a) Beneficial Ownership Reporting Compliance

Based on a review of reports filed by our directors, executive officers, and beneficial owners of more than 10% of our shares of common stock pursuant to Section 16 of the Securities Exchange Act of 1934, as amended, and other information available to us, we believe that all such ownership reports required to be filed by those reporting persons during and with respect to Fiscal 2022 were timely made.

Clawback Policy

The Board has adopted a Clawback Policy providing for the recoupment of certain executive compensation in the event of an accounting restatement resulting from material noncompliance with financial reporting requirements under the U.S.

federal securities laws.

The Clawback Policy is available on our home office website under the investor relations tab at www.bgsf.com.

The information on our website is not a part of this Annual Report on Form 10-K.

Delinquent Section 16(a) Reports

Executive Compensation.

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• Beth Garvey, our Chair, President and Chief Executive Officer;

• Dan Hollenbach, our Chief Financial Officer and Secretary

Barnett, our Chief Financial Officer and Secretary since March 2023.

• Dan Hollenbach, who served as our Chief Financial Officer and Secretary until March 2023.

Throughout this section, the term “named executive officer” is intended to refer to the individuals identified above.

Fiscal 2022, we had only two named executive officers, each of whom is set forth above.

Fiscal 2023, we had only three executive officers, each of whom is set forth above.

Summary Compensation Table

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2022 $425,000 $297,500 $79,598 $203,268 $— $— $15,521 (1) $1,020,887

Dan Hollenbach Chief Financial Officer and Secretary

Dan Hollenbach Chief Financial Officer and Secretary (through March 2023)

2023 $339,200 $45,543 $55,661 $19,859 $— $— $12,084 (1) $472,347

2022 $320,000 $224,000 $64,898 $109,525 $— $— $10,800 (1) $729,223

John Barnett Chief Financial Officer and Secretary

2023 $282,692 $— $17,114 $12,382 $— $— $2,692 (1) $314,880

2022 $— $— $— $— $— $— $— $—

(*) The amounts reflect the dollar amounts recognized for financial statement reporting purposes in accordance with FASB ASC Topic 718.

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Garvey’s annual compensation is evaluated annually, but may not be less than $350,000 per year.

Effective December 27, 2020, Ms.

Effective February 3, 2023, Ms.

Garvey’s annual salary was raised to $450,500.

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Chief Financial Officer

On October 1, 2018, we amended a 2015 employment agreement with Dan Hollenbach pursuant to which Mr.

Hollenbach serves as our Chief Financial Officer and Secretary through September 30, 2021.

The contract remains in effect under successive one-year extensions unless terminated pursuant to its terms.

Hollenbach's annual compensation is evaluated annually, but may not be less than $275,000 per year.

Effective December 27, 2020, Mr.

Hollenbach's annual salary was raised to $320,000.

On March 3, 2023, Dan Hollenbach resigned as the Chief Financial Officer and Secretary of the Company and its subsidiaries, effective March 20, 2023, and will then act as a senior advisor with BGSF through April 30, 2024.Mr.

Hollenbach’s resignation was part of the Company’s leadership succession plan and Mr.

Hollenbach’s planned retirement.

On March 3, 2023, the Company and BG Staff Services, Inc., a subsidiary of the Company, entered into an Amended Executive Employment Agreement (the “Amended Employment Agreement”) with Mr.Hollenbach.

The Amended Employment Agreement remains in effect through April 30, 2024, unless extended by mutual agreement or terminated pursuant to its terms.

Hollenbach is eligible to receive an annual cash bonus based on achieving certain adjusted EBITDA levels (as defined by the Compensation Committee) and, except as stated in his employment agreement, provided that Mr.

Hollenbach is in our employment on the last day of the fiscal year.

Moreover, if certain acquisitions occur during his employment period, Mr.

Hollenbach will receive a bonus equal to 1% of the acquired company’s adjusted EBITDA, as determined by the Board, for the first 12 months after the acquisition’s closing date.

We executed an employment agreement, effective March 20, 2023, with John R.

Barnett pursuant to which Mr.

Barnett serves as our Chief Financial Officer and Secretary through December 31, 2025.

The agreement remains in effect under successive one-year extensions unless terminated pursuant to its terms.

Barnett’s annual compensation is evaluated annually, but the then effective base salary.

Effective March 25, 2024, Mr.

Barnett’s annual salary will be raised to $375,000 and effective March 24, 2025, raised to $400,000.

Barnett is eligible to receive an annual cash bonus based on achieving certain adjusted EBITDA levels (as defined by the Compensation Committee) and, except as stated in his employment agreement, provided that Mr.

Barnett is in our employment on the last day of the fiscal year.

Moreover, if certain acquisitions occur during his employment period, and Mr.

Barnett will receive a bonus equal to 1% of the acquired company’s adjusted EBITDA, as determined by the Board, for the first 12 months after the acquisition’s closing date.

The Compensation Committee may also grant discretionary bonuses.

In the event that Mr.

Hollenbach’s employment is terminated by us without cause or by Mr.

Hollenbach for good reason, Mr.

Hollenbach will receive as severance installments equal to twelve months of base salary plus COBRA premiums for eighteen months for Mr.

Hollenbach and his dependents.

Barnett’s employment is terminated by us without cause or by Mr.

Barnett for good reason, Mr.

Barnett will receive as severance installments equal to twelve months of base salary plus COBRA premiums for eighteen months for Mr.

Barnett and his dependents.

In the event that Mr.

Hollenbach’s employment is terminated without cause or for good reason within one year of a change in control, Mr.

Hollenbach will receive his base salary and COBRA premiums for eighteen months for him and his dependents.

Hollenbach will also generally be entitled to receive any bonus payable but unpaid, payment for unused vacation days, and unpaid reimbursements.

Barnett’s employment is terminated without cause or by Mr.

Barnett within one year of a change in control, Mr.

Barnett will receive his base salary and COBRA premiums for eighteen months for him and his dependents.

Barnett will also generally be entitled to receive any bonus payable but unpaid, payment for unused vacation days, and unpaid reimbursements.

The severance is contingent upon Mr.

Hollenbach’s execution of a separation agreement including a general release.

Barnett’s execution of a separation agreement including a general release.

In the event that Mr.

Hollenbach’s employment is terminated by us for cause, or by Mr.

Hollenbach other than for good reason, we will pay to Mr.

Hollenbach any monthly salary, bonus, unused vacation, and expense reimbursements, earned or due to Mr.

Hollenbach but unpaid.

Hollenbach have also entered into a confidentiality, non-solicitation, non-interference and non-competition agreement.

Barnett’s employment is terminated by us for cause, or by Mr.

Barnett other than for good reason, we will pay to Mr.

Barnett any monthly salary, bonus, unused vacation, and expense reimbursements, earned or due to Mr.

Barnett but unpaid.

Barnett have also entered into a confidentiality, non-solicitation, noninterference and non-competition agreement.

Pursuant to the agreement, Mr.

Hollenbach generally agrees not to disclose our confidential information (as defined in the agreement) and, for a period of eighteen months following his termination, not to solicit our client partners, interfere with our client partner and supplier relationships, or solicit our team members.

Hollenbach also agrees not to compete with us for a period of twelve months after termination.

Hollenbach was granted stock options and restricted stock in Fiscal 2022 as further described under “Outstanding Equity Awards” below.

Barnett generally agrees not to disclose our confidential information (as defined in the agreement) and, for a period of eighteen months following his termination, not to solicit our client partners, interfere with our client partner and supplier relationships, or solicit our team members.

Barnett also agrees not to compete with us for a period of twelve months after termination.

Barnett was granted stock options and restricted stock in Fiscal 2023 as further described under “Outstanding Equity Awards” below.

Dan Hollenbach resigned as Chief Financial Officer and Secretary effective March 20, 2023, and will then act as a senior advisor with BGSF through April 30, 2024.

Hollenbach’s resignation was part of the Company’s leadership succession plan and Mr.

Hollenbach’s planned retirement.

Effective February 3, 2023, Mr.

Hollenbach’s annual salary was raised to $339,000.

2013 Long-Term Incentive Plan

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Under the original 2013 Plan team members, directors and consultants of the Company may receive incentive stock options and other awards.

To the extent any option or award expires unexercised or is canceled, terminated or forfeited in any manner without the issuance of common stock thereunder, such shares shall again be available for issuance under the original 2013 Plan, of which 1,012,967 shares remain available for issuance as of January 1, 2023.

To the extent any option or award expires unexercised or is canceled, terminated or forfeited in any manner without the issuance of common stock thereunder, such shares shall again be available for issuance under the original 2013 Plan, of which 1,215,987 shares remain available for issuance as of December 31, 2023.

The term of each option is determined by the Board but cannot exceed 10 years.

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333-218869) filed on June 20, 2017, Form S-8 (File No.

333-251192) filed on December 8, 2020, and Note 16 in the Notes to Consolidated Financial Statements.

333-251192) filed on December 8, 2020, Form S-8 (File No.

333-274809) filed on October 2, 2023, and Note 16 in the Notes to Consolidated Financial Statements.

2020 Employee Stock Purchase Plan (“2020 ESPP”)

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were initially reserved for issuance pursuant to the 2020 ESPP.

As of January 1, 2023, 158,718 shares remain available for issuance.

As of December 31, 2023, 93,245 shares remain available for issuance.

For more details on our 2020 Plan, see our registration statement on Form S-8 (File No.

1 unchanged sentence

Outstanding Equity Awards

The following table presents outstanding equity awards as of January 1, 2023.

The following table presents outstanding equity awards as of December 31, 2023.

Name Option Awards Stock Awards

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09/24/2018 93,852 — — $ 25.71 09/24/2028 — —

06/07/2017 2,500 — — $ 16.76 06/07/2027 — —

06/07/2017 10,000 — — $ 16.76 06/07/2027 — —

08/16/2016 13,185 — — $ 17.46 08/16/2026 — —

08/16/2016 36,815 — — $ 17.46 08/16/2026 — —

06/09/2015 20,000 — — $ 11.00 06/09/2025 — —

John Barnett 03/20/2023 — — — $ 10.25 03/20/2026 6,375 (18) $ 65,344

03/20/2023 — 9,756 (9) — $ 10.25 03/20/2026 — —

03/20/2023 — 5,644 (10) — $ 10.25 03/20/2026 — —

Dan Hollenbach 02/17/2023 — — $ — 02/17/2033 1,766 (19) $ 26,879

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06/07/2017 7,500 — — $ 16.76 06/07/2027 — —

(1) Incentive stock options will vest 5,065 on August 3, 2023, 5,065, on August 3, 2024, 5,972 on August 3, 2025, and 7,770 on August 2026.

(2) Non-qualified stock options will vest 4,935 on August 3,2023, 4,935 on August 3, 2024, 4,028 on August 3, 2025, and 2,230 on August 2, 2026.

(3) Incentive stock options will vest 2,000 on August 4, 2023, 2,000 on August 4,2024, and 2,000 on August 4, 2025.

(4) Non-qualified stock options will vest 1,200 on August 4, 2023, and 1,200 on August 4, 2024.

(5) Incentive stock options will vest 2,000 on August 3, 2023, 2,000 on August 3, 2024, 2,000 on August 3, 2025, and 2,000 August 3, 2026.

10/27/2015 17,012 — — $ 11.07 10/27/2025 — —

10/27/2015 19,835 — — $ 11.07 10/27/2025 — —

(1) Non-qualified stock options will vest 10,000 on September 1, 2024, 10,000 on September 1, 2025, 10,000 on September 1, 2026, and 1,007 on September 1, 2027.

(2) Incentive stock options will vest 8,993 on September 1, 2027.

(3) Non-qualified stock options will vest 871 on February 17, 2024, 871 on February 17, 2025, and 871 on February 17, 2026.

(4) Incentive stock options will vest 871 on February 17, 2027.

(5) Incentive stock options will vest 5,065 on August 3, 2024, 5,972 on August 3, 2025, and 7,770 on August 2026.

(7) Non-qualified stock options will vest 900 on August 4, 2023, and 900 on August 4, 2024.

(8) Shares will vest 941 on May 4, 2023, 940 on May 4, 2024, and 940 on May 4, 2025.

(9) Shares will vest 5,000 on August 10, 2023, and 5,000 on August 10, 2024.

(10) Shares will vest 3,750 on August 10, 2023, and 3,750 on August 10, 2024.

(6) Non-qualified stock options will vest 4,935 on August 3, 2024, 4,028 on August 3, 2025, and 2,230 on August 2, 2026.

(7) Incentive stock options will vest 2,000 on August 4, 2024, and 2,000 on August 4, 2025.

(8) Non-qualified stock options will vest 1,200 on August 4, 2024.

(9) Incentive stock options will vest 9,756 on March 16, 2026.

(10) Non-qualified stock options will vest 5,644 on March 16, 2026.

(11) Incentive stock options will vest 394 on February 17, 2024, 393 on February 17, 2025, 393 on February 17, 2026 and 393 on February 17, 2027.

(12) Incentive stock options will vest 2,000 on August 3, 2024, 2,000 on August 3, 2025, and 2,000 August 3, 2026.

(13) Incentive stock options will vest 1,000 on August 4, 2024, and 1,000 on August 4, 2025.

(14) Non-qualified stock options will vest 900 on August 4, 2024.

(15) Shares will vest 1,916 on February 17, 2024 and 1,916 on February 17, 2025.

(16) Shares will vest 940 on May 4, 2024, and 940 on May 4, 2025.

(17) Shares will vest 5,000 on August 10, 2024.

(18) Shares will vest 6,375 on March 16, 2026.

(19) Shares will vest 883 on February 17, 2024 and 883 on February 17, 2025.

(20) Shares will vest 3,750 on August 10, 2024.

Each option and stock award is subject to the condition that the optionee will have remained employed by the Company, or any one or more of its subsidiaries, through such vesting dates, and each option is further subject to the terms and conditions set forth in the 2013 Plan and in the applicable Stock Option Agreement.

15 unchanged sentences

$ 45,000 $ 5,000 $ — $ — $ — $ 50,000

Donna Carroll $ 36,250 $ 5,000 $ — $ — $ — $ 41,250

Hailey $ 45,000 $ 5,000 $ — $ — $ — $ 50,000

13 unchanged sentences

$ 50,000 $ 66,788 $ 8,831 $ — $ — $ — $ 125,619

Donna Carroll $ 41,250 $ 19,684 $ 1,958 $ — $ — $ — $ 62,892

Hailey $ 50,000 $ 66,788 $ 8,831 $ — $ — $ — $ 125,619

16 unchanged sentences

David Allen, Jr.

John Barnett 6,375 (2)

Donna Carroll 6,381 (4)

Hailey 202,264 (6)

Dan Hollenbach 154,659 (5)

Cynthia Marshall 25,047 (7)

1 unchanged sentence

All executive officers and directors as a group (8 total) 801,569 7.0 %

Dan Hollenbach 161,971 (9)

North Star Investment Management Corporation (10)

1 unchanged sentence

(1) Includes 8,185 shares of common stock issuable upon exercise of stock options and 9,118 shares of unvested restricted common stock.

(2) Includes 6,375 of unvested restricted common stock

(3) Includes 19,435 shares of common stock issuable upon exercise of stock options, 35,891 shares of common stock held by a private investment company controlled by Mr.

5 unchanged sentences

(8) Includes 20,435 shares of common stock issuable upon exercise of stock options and 9,118 shares of unvested restricted common stock.

(9) Includes 135,736 shares of common stock issuable upon exercise of stock options and 7,396 shares of unvested restricted common stock.

(10) The address of North Star Investment Management Corporation is 20 N.

16 unchanged sentences

However, such a director may be counted in determining the presence of a quorum at a meeting of the committee that considers the transaction.

See Item 10, Directors, Executive Officers and Corporate Governance, with respect to the independence of our directors.

Principal Accountant Fees and Services.

7 unchanged sentences

185,185 203,061

All Other Fees

$ 492,502 $ 493,485

8 unchanged sentences

Audited Consolidated Financial Statements of BGSF, Inc.

As of and for the Fiscal Years Ended January 1, 2023, December 26, 2021, and December 27, 2020.

Report of Independent Registered Public Accounting Firm (PCAOB ID 726 )

As of and for the Fiscal Years Ended December 31, 2023, January 1, 2023, and December 26, 2021.

Report of Independent Registered Public Accounting Firm (Whitley Penn PCAOB ID 726 )

Consolidated Balance Sheets

Consolidated Statements of Operations and Comprehensive Income

Consolidated Statements of Operations and Comprehensive (L oss) Income

Consolidated Statements of Changes in Stockholders ’ Equity

11 unchanged sentences

Beth Garvey (Principal Executive Officer)

/s/ Dan Hollenbach Chief Financial Officer and Secretary

Dan Hollenbach (Principal Financial and Accounting Officer)

/s/ John Barnett Chief Financial Officer and Secretary

John Barnett (Principal Financial and Accounting Officer)

David Allen, Jr.

1 unchanged sentence

/s/ Richard L.

/s/ Donna Carroll Director

Donna Carroll

/s/ Douglas E.

10 unchanged sentences

Asset Purchase Agreement, dated as of December 12, 2022, by and between BG Professional LLC, Horn Solutions, Inc., Horn Solutions Dallas, LLC, and Gary Horn (incorporated by reference from the registrant’s Current Report on Form 8-K filed on December 14, 2022)

Asset Purchase Agreement, dated April 24, 2023, by and between BGSF Professional, LLC, Arroyo Consulting LLC, Luis Fernando Sanchez, and Maureen E.

Herrera (incorporated by reference from the registrant’s Current Report on Form 8-K filed on April 26, 2023)

3.1 Certificate of Incorporation of BG Staffing, Inc.

13 unchanged sentences

BG Staffing, Inc.

2013 Long-Term Incentive Plan (incorporated by reference from the registrant’s definitive proxy statement on Schedule 14A filed on September 15, 2020)

2013 Long-Term Incentive Plan (incorporated by reference from the registrant’s definitive proxy statement on Schedule 14A filed on June 20, 2023)

Form of Nonqualified Stock Option Agreement (Vested Options) (incorporated by reference from the registrant’s Form 8-K filed on February 12, 2014)

29 unchanged sentences

, as administrative agent for the Lenders and as a lender (incorporated by reference from the registrant’s Current Report on Form 8-K filed on December 14, 2022)

E xecutive Employment Agreement, dated as of March 3, 2023, between BG Staff Services, Inc.

Executive Employment Agreement, dated as of March 3, 2023, between BG Staff Services, Inc.

and John Barnett (incorporated by reference from the registrant’s Current Report on Form 8-K filed on March 9, 2023)

Amended Executive Employment Agreement, dated as of March 3, 2023, between BGSF, Inc., B G Staff Services, Inc.

Amended Executive Employment Agreement, dated as of March 3, 2023, between BGSF, Inc., BG Staff Services, Inc.

and Dan Hollenbach (incorporated by reference from the registrant’s Current Report on Form 8-K filed on March 9, 2023)

10.22 Third Amendment to Credit Agreement dated as of April 24,2023, by and among BGSF, Inc., the Guarantors party hereto, and BMO Harris Bank N.A.,as administrative agent for the Lenders and as a lender(incorporated by reference from the registrant's Quarterly Report on Form 10-Q filed on May 11, 2023)

10.23 Fourth Amendment to Credit Agreement dated as of May 19, 2023, by and among BGSF, Inc., the Guarantors party hereto, and BMO Harris Bank N.A., as administrative agent for the Lenders and as a lender (incorporated by reference from the registrant's Current Report on Form 8-K filed on May 25, 2023)

Amended and Restated Credit Agreement, dated as of March 12, 2024, among BGSF, Inc., as Borrower, the Lenders from time to time party thereto, BMO Bank, N.A., as Administrative Agent, L/C Issuer, and Swing Line Lender, and BMO Capital Markets Corp., as Sole Lead Arranger and Sole Book Runner

List of Subsidiaries of the Registrant

4 unchanged sentences

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

97.1* BGSF, Inc.

Clawback Policy

XBRL Instance Document

11 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures