Blue Bird Corp 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports the Company files or submits under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In connection with the preparation of this Annual Report on Form 10-K, the Company carried out an evaluation under the supervision of and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, as of October 3, 2020 on the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective. Management’s Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rule 13a-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. 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 or procedures may deteriorate. Management assessed the effectiveness of our internal control over financial reporting as of the end of the period covered by this Report. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control – Integrated Framework (2013) . Based on management's assessment and those criteria, management concluded that our internal control over financial reporting was effective as of October 3, 2020 . Our independent registered public accounting firm has issued their report on the effectiveness of our internal control over financial reporting as of October 3, 2020 , which appears in this Annual Report on Form 10-K. Changes in Internal Control over Financial Reporting There have been no changes in our internal control over financial reporting that occurred during the fourth fiscal quarter ended October 3, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Item 9B. Other Information None. 74 PART III Certain information required by Part III of this Annual Report on Form 10-K is incorporated by reference from the Company’s definitive proxy statement (the “Proxy Statement”) to be filed pursuant to Regulation 14A for the Company’s Annual Meeting of Stockholders to be held in March 2021 . The Company will, within 120 days of the end of its fiscal year, file the Proxy Statement with the SEC or supply the information required by this Part III by amendment to this Annual Report on Form 10-K. Item 10. Directors, Executive Officers and Corporate Governance The information responsive to this item is incorporated by reference from the sections entitled “Election of Directors,” “Information Concerning Management,” and “Corporate Governance and Board Matters” contained in the Proxy Statement. Item 11. Executive Compensation The information responsive to this item is incorporated by reference from the section entitled “Director and Executive Compensation” contained in the Proxy Statement. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information responsive to this item is incorporated by reference from the section entitled “Security Ownership of Certain Beneficial Owners and Management” contained in the Proxy Statement. See also the section entitled “Securities Authorized for Issuance under Equity Compensation Plans” in Item 5 of this Report. Item 13. Certain Relationships and Related Transactions, and Director Independence The information responsive to this item is incorporated by reference from the sections entitled “Corporate Governance and Board Matters” and “Certain Relationships and Related Transactions” contained in the Proxy Statement. Item 14. Principal Accountant Fees and Services The information responsive to this item is incorporated by reference from the section entitled “Certain Accounting and Audit Matters” contained in the Proxy Statement. 75 PART IV Item 15. Exhibits and Financial Statement Schedules (a) Index (1) Financial Statements. The following financial statements are located in Item 8 of this Annual Report on Form 10-K: Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets at October 3, 2020 and September 28, 2019 Consolidated Statements of Operations for the fiscal years ended October 3, 2020 , September 28, 2019 and September 29, 2018 Consolidated Statements of Comprehensive Income for the fiscal years ended October 3, 2020 , September 28, 2019 and September 29, 2018 Consolidated Statements of Stockholders' Deficit for the fiscal years ended October 3, 2020 , September 28, 2019 and September 29, 2018 Consolidated Statements of Cash Flows for the fiscal years ended October 3, 2020 , September 28, 2019 and September 29, 2018 Notes to Consolidated Financial Statements (2) Financial Statement Schedules. Financial Statement Schedule II - Valuation and Qualifying Accounts All other schedules are not required under the related instructions or are not applicable. (b) Exhibits Exhibit No. Description 3.1 The registrant’s Second Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed by the registrant on February 26, 2015) 3.2 The registrant’s Bylaws (incorporated by reference to Exhibit 3.3 to the registrant’s registration statement on Form S-1 (File No. 333-192982) filed by the registrant on December 20, 2013). 4.1 Specimen stock certificate for the registrant’s common stock (incorporated by reference to Exhibit 4.1 to the registrant’s Current Report on Form 8-K filed by the registrant on March 2, 2015). 4.2 Credit Agreement dated as of December 12, 2016 by and among Blue Bird Corporation, School Bus Holdings, Inc. and certain of its subsidiaries and affiliates and Bank of Montreal, as Administrative Agent and an Issuing Bank, Fifth Third Bank, as Co-Syndication Agent and an Issuing Bank and Regions Bank, as Co-Syndication Agent, and the other lenders party thereto, together with certain exhibits (incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed by the registrant on December 15, 2016). 4.3 First Amendment to Credit Agreement, dated as of September 13, 2018, by and among Blue Bird Corporation, School Bus Holdings, Inc. and certain of its subsidiaries, including Blue Bird Body Company as the borrower, Bank of Montreal, as Administrative Agent and certain other financial institutions party thereto (incorporated by reference to Exhibit 10.1 to the registrant's Current Report on Form 8-K filed by the registrant on September 13, 2018). 4.4 Second Amendment to Credit Agreement, dated as of May 7, 2020, by and among the Company, School Bus Holdings, Inc. and certain of its subsidiaries, including Blue Bird Body Company as the borrower, Bank of 76 Montreal, as Administrative Agent and certain other financial institutions party thereto (incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed by the registrant on May 8, 2020). 4.5* Description of the registrant's securities. 10.1† Blue Bird Corporation Amended and Restated 2015 Omnibus Equity Incentive Plan (the “Incentive Plan”) (incorporated by reference to Appendix A to the registrant’s definitive Proxy Statement, as filed on January 27, 2020). 10.2 Registration Rights Agreement, dated as of February 24, 2015, by and among the registrant, The Traxis Group B.V. and the investors named therein (incorporated by reference to Exhibit 10.11 of the registrant’s Current Report on Form 8-K filed by the registrant on March 2, 2015). 10.3 Purchase and Sale Agreement dated May 26, 2016 by and among The Traxis Group BV, Blue Bird Corporation and ASP BB Holdings LLC (incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed by the registrant on May 27, 2016). 10.4† Form of grant agreement for incentive stock options granted under the registrant’s Incentive Plan (incorporated by reference to Exhibit 10.16 to the registrant’s Current Report on Form 8-K filed by the registrant on March 2, 2015). 10.5† Form of grant agreement for non-qualified stock options granted under the registrant’s Incentive Plan (incorporated by reference to Exhibit 10.17 to the registrant’s Current Report on Form 8-K filed by the registrant on March 2, 2015). 10.6† Form of grant agreement for restricted stock granted under the registrant’s Incentive Plan (incorporated by reference to Exhibit 10.18 to the registrant’s Current Report on Form 8-K filed by the registrant on March 2, 2015). 10.7† Form of grant agreement for restricted stock units granted under the registrant’s Incentive Plan (incorporated by reference to Exhibit 10.19 to the registrant’s Current Report on Form 8-K filed by the registrant on March 2, 2015). 10.8† Revised form of grant agreement for non-qualified stock options granted under the registrant's Incentive Plan (incorporated by reference to Exhibit 10.8 to the registrant's Annual Report on Form 10-K filed by the registrant on December 12, 2019). 10.9† Revised form of grant agreement for restricted stock units granted under the registrant's Incentive Plan (incorporated by reference to Exhibit 10.9 to the registrant’s Annual Report on Form 10-K filed by the registrant on December 12, 2019). 10.10 Form of indemnity agreement between the registrant and each of its directors and executive officers (incorporated by reference to Exhibit 10.23 to the registrant’s Current Report on Form 8-K filed by the registrant on March 2, 2015). 10.11† Employment Agreement, dated as of April 1, 2011, between School Bus Holdings Inc. and Philip Horlock (incorporated by reference to Exhibit 10.24 to the registrant’s Current Report on Form 8-K/A filed by the registrant on April 23, 2015). 10.12† First Amendment to Employment Agreement dated as of April 1, 2011 between School Bus Holdings Inc. and Philip Horlock made as of June 1, 2012 (incorporated by reference to Exhibit 10.25 to the registrant’s Current Report on Form 8-K/A filed by the registrant on April 23, 2015). 10.13† Severance Agreement, dated as of May 10, 2012, between Blue Bird Corporation and Charles (Trey) Jenkins III (incorporated by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q filed by the registrant on February 13, 2020). 77 10.14† Severance Agreement, dated as of July 1, 2008, between School Bus Holdings Inc. and Paul Yousif (incorporated by reference to Exhibit 10.31 to the registrant’s Current Report on Form 8-K/A filed by the registrant on April 23, 2015). 10.15† Form of Restricted Stock Unit Grant Agreement for directors under the registrant’s Incentive Plan (incorporated by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q/A filed by the registrant on August 18, 2015). 10.16 Credit Agreement dated as of December 12, 2016 by and among Blue Bird Corporation, School Bus Holdings, Inc. and certain of its subsidiaries and affiliates and Bank of Montreal, as Administrative Agent and an Issuing Bank, Fifth Third Bank, as Co-Syndication Agent and an Issuing Bank and Regions Bank, as Co-Syndication Agent, and the other lenders party thereto, together with certain exhibits (incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed by the registrant on December 15, 2016). 10.17† Offer Letter dated March 29, 2016 and Severance Agreement dated April 18, 2016 between Blue Bird Corporation and Mark Terry (incorporated by reference to Exhibit 10.19 to the Company's Annual Report on Form 10-K filed by the Company on December 8, 2017). 10.18† Offer Letter dated October 19, 2015 between Blue Bird Corporation and Tom Roberts (incorporated by reference to Exhibit 10.20 to the Company's Annual Report on Form 10-K filed by the Company on December 8, 2017). 10.19 First Amendment to Credit Agreement, dated as of September 13, 2018, by and among the Company, School Bus Holdings, Inc. and certain of its subsidiaries, including Blue Bird Body Company as the borrower, Bank of Montreal, as Administrative Agent and certain other financial institutions party thereto (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed by the Company on September 13, 2018). 10.20 Second Amendment to Credit Agreement, dated as of May 7, 2020, by and among Blue Bird Corporation, School Bus Holdings, Inc. and certain of its subsidiaries, including Blue Bird Body Company as the borrower, Bank of Montreal, as Administrative Agent, and certain other financial institutions party thereto (incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed by the registrant on May 8, 2020). 10.21† Revised form of grant agreement for non-qualified stock options granted to employees under the registrant’s Incentive Plan (incorporated by reference to Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q filed by the registrant on February 13, 2020). 10.22† Revised form of grant agreement for restricted stock units granted to employees under the registrant’s Incentive Plan (incorporated by reference to Exhibit 10.3 to the registrant’s Quarterly Report on Form 10-Q filed by the registrant on February 13, 2020). 10.23† Retirement Agreement, dated as of May 30, 2020, between Blue Bird Corporation and Phillip Tighe (incorporated by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q filed by the registrant on August 13, 2020). 10.24† Consulting Agreement, dated as of May 30, 2020, between Blue Bird Corporation and Phillip Tighe (incorporated by reference to Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q filed by the registrant on August 13, 2020). 10.25† Offer Letter, dated as of April 28, 2020, between Blue Bird Corporation and Jeffery L. Taylor (incorporated by reference to Exhibit 10.3 to the registrant’s Quarterly Report on Form 10-Q filed by the registrant on August 13, 2020). 10.26† Severance Agreement, dated as of May 1, 2020, between Blue Bird Corporation and Jeffery L. Taylor (incorporated by reference to Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q filed by the registrant on August 13, 2020). 21.1* Subsidiaries of the registrant. 78 23.1* Consent of BDO USA, LLP. 31.1* Chief Executive Officer’s Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934. 31.2* Chief Financial Officer’s Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934. 32.1* Chief Executive Officer’s Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2* Chief Financial Officer’s Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101* The following materials from the Company's Annual Report on Form 10-K for the fiscal year ended October 3, 2020 formatted in XBRL (eXtensible Business Reporting Language) and furnished electronically herewith: (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements of Comprehensive Income (Loss); (iv) Consolidated Statements of Changes in Stockholders' Equity; (iv) Consolidated Statements of Cash Flows; and (v) Notes to the Consolidated Financial Statements. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) _________________________ * Filed herewith. † Management contract or compensatory plan or arrangement. Item 16. Form 10-K Summary Omitted at registrant's option. SCHEDULE II- VALUATION AND QUALIFYING ACCOUNTS (in thousands) Allowance for Doubtful Accounts Fiscal Year Ended Beginning Balance Charges to Expense/(Income) Doubtful Accounts Written Off, Net Ending Balance September 29, 2018 $ 100 $ — $ — $ 100 September 28, 2019 100 — — 100 October 3, 2020 100 — — 100 (in thousands) Deferred Tax Valuation Allowance Fiscal Year Ended Beginning Balance Charges to Expense/(Income) Charges utilized/Write offs Ending Balance September 29, 2018 $ 650 $ 847 $ ( 65 ) $ 1,432 September 28, 2019 1,432 1,203 ( 159 ) 2,476 October 3, 2020 2,476 999 ( 22 ) 3,453 79 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. Blue Bird Corporation Date: December 17, 2020 By: /s/ Philip Horlock Philip Horlock President and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Person Capacity Date /s/ Philip Horlock President, Chief Executive Officer and Director Philip Horlock (Principal Executive Officer) December 17, 2020 /s/ Jeffery Taylor Chief Financial Officer Jeffery Taylor (Principal Financial and Accounting Officer) December 17, 2020 /s/ Gurminder S. Bedi Gurminder S. Bedi Director December 17, 2020 /s/ Chan Galbato Chan Galbato Director December 17, 2020 /s/ Douglas Grimm Douglas Grimm Director December 17, 2020 /s/ Kevin Penn Kevin Penn Director December 17, 2020 /s/ Alan H. Schumacher Alan H. Schumacher Director December 17, 2020 /s/ Kathleen M. Shaw, PH.D. Kathleen M. Shaw, PH.D. Director December 17, 2020 /s/ Jared Sperling Jared Sperling Director December 17, 2020 80