BGSF, INC. 8-K

What Happened

• BGSF, Inc. announced that its Board approved Keith Schroeder and Kelly Brown as Co-Chief Executive Officers on a permanent (non‑interim) basis.
• On February 24, 2026, B G Staff Services, Inc. (a BGSF subsidiary) and Kelly Brown entered an Executive Employment Agreement and related agreements (non‑disclosure/non‑compete and indemnification) that set compensation, bonus and separation terms.

Key Details

• Base salary: initial annualized base pay of $375,000 (subject to Compensation Committee review, not to be reduced below then‑effective salary).
• Bonus incentives: eligible for an annual bonus tied to the Company’s adjusted EBITDA and potential acquisition bonuses — 1% of an acquired company’s adjusted EBITDA for the first 12 months if Brown is involved in the acquisition as specified.
• Severance and equity: if terminated without “cause” or for “good reason” (or non‑renewal), Brown is eligible for 12 months’ base salary plus COBRA premiums for 18 months (contingent on signing a release) and full vesting of outstanding equity awards; severance increases to 18 months’ base salary if termination without cause or resignation within one year after a “change of control.”
• Covenants and indemnity: Brown agreed to non‑disclosure, non‑solicit (18 months), and non‑compete (12 months) post‑termination restrictions; the company also entered an indemnification agreement providing advancement and indemnity to the fullest extent permitted by Delaware law.
• Agreement term: Employment Agreement runs through December 31, 2027, then renews for successive one‑year terms unless non‑renewed in writing.

Why It Matters

• Leadership: appointing two permanent Co‑CEOs provides clarity on executive leadership and succession, which investors often view as a stability signal.
• Financial impact: the salary, bonus formulas tied to adjusted EBITDA, acquisition incentives, severance and accelerated equity vesting create potential cash and equity dilution exposures that could affect future results, especially in the event of a termination or a change‑of‑control.
• Alignment: incentive pay tied to adjusted EBITDA and acquisition success aligns Brown’s compensation with the company’s operating performance and growth through acquisitions, which may support management’s strategic priorities.