DEF 14A of Bgsf, Inc., Jun 17, 2024

DEF 14A of Bgsf, Inc.

Filed Jun 17, 2024 · FY20230001474903-24-000062

Open on EDGAR

  1. Independent Director Age: 59 Director Since: 2023 Committees Served: Audit Committee, Compensation Committee

    Independent Director Age: 59 Director Since: 2023 Committees Served: Audit Committee, Compensation Committee Ms. 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. Ms. 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.

  2. Who are the continuing members of the Board?

    Who are the continuing members of the Board? The terms of the following five members of our Board will continue past the annual meeting. Term to Expire at the 2025 Annual Meeting: Richard L. Baum, Jr. Independent Director Age: 64 Director Since: 2013 Committees Served: Audit Committee, Compensation Committee (Chair), Nominating and Corporate Governance Committee (Chair) Richard L. Baum, Jr. 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. Mr. 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. Prior to joining Taglich, Mr. Baum led a group that purchased a private equity portfolio from Transamerica Business Credit. From 1998 to 2003, Mr. Baum was a Managing Director in the small business merger and acquisition practices of Wachovia Securities and its predecessor, First Union Securities. From 1988 through 1998, Mr. Baum was a Principal with the Mid-Atlantic Companies, Ltd., a financial services firm acquired by First Union in 1998. Mr. Baum received a Bachelor of Science from Drexel University and a Master of Business Administration from the Wharton School of the University of Pennsylvania. Our Board benefits from Mr. 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.

  3. Cynthia Marshall

    Cynthia Marshall

  4. Independent Director Age: 64 Director Since: 2020 Committees Served: Compensation Committee, Nominating and Corporate Governance Committee

    Independent Director Age: 64 Director Since: 2020 Committees Served: Compensation Committee, Nominating and Corporate Governance Committee Ms. Marshall is currently the CEO of the Dallas Mavericks, and is Founder, President and CEO of the consulting firm Marshalling Resources. The Marshalling Resources consulting firm specializes in leadership, diversity and inclusion, culture transformation and overall optimization of people resources. Ms. Marshall is also a Director of Jeld-Wen Holdings, Inc (NYSE:JELD). Ms. Marshall worked with The Dow Chemical Company in 2017 and 2018 to develop and implement a strategy for institutionalizing an inclusive culture. Prior to this position, Ms. Marshall retired from a 36-year career at AT&T, where she had ultimately served as SVP - Human Resources and Chief Diversity Officer. She was responsible for identifying and developing leaders, aligning employees with the company’s vision and priorities, overseeing major business unit HR support, performance development, employee engagement, skills transformation initiatives, EEO and Affirmative Action. She led the team that created a world class Diversity and Inclusion culture, earning AT&T a top 3 ranking on Diversity Inc’s 2017 Top 50 list of companies. Ms. Marshall also spearheaded the work that for the first-time placed AT&T on Fortune’s 100 Best Companies to Work For list in 2017 (one of only two Fortune 50 companies). Before her SVP-Human Resources and Chief Diversity Officer roles, Ms. Marshall served as President - AT&T North Carolina where she became the first African-American chair of the North Carolina State Chamber of Commerce. Marshall graduated from the University of California-Berkeley with degrees in Business Administration and Human Resources Management and holds four honorary Doctorate degrees. Ms. Marshall has chaired a variety of non-profit boards and is currently on the board of Dallas CASA, Dallas Regional Chamber, Texas Women’s Foundation, Texas 2036 and a member of the Executive Leadership Council. Our Board benefits from Ms. Marshall’s extensive leadership and business experience and her expertise with respect to human resources and culture.

  5. Paul A. Seid

    Paul A. Seid

  6. Independent Director Age: 76 Director Since: 2014 Committees Served: Compensation Committee, Nominating and Corporate Governance Committee

    Independent Director Age: 76 Director Since: 2014 Committees Served: Compensation Committee, Nominating and Corporate Governance Committee Since 2010, Mr. Seid has served on the board of directors of BioVentrix, a medical device company. Starting in 2013, he has served as Chief Executive Officer of RST Automation, a maker of hospital robotic devices which was established 2004. For the past eighteen years he has been President of Strategic Data Marketing, a research and data collection company. Mr. Seid is also a director of Intellinetics, Inc. (NYSE: INLX). He has also founded, bought and/ or sold over twenty companies in Asia, Europe, North, and South America. Mr. Seid graduated from Queen’s College, a division of the City University of New York, in 1968 with a Bachelor’s degree in Political Science. Mr. Seid has held numerous other board of directors and consulting positions. Our Board benefits from Mr. Seid’s extensive experience growing diverse businesses. Term to Expire at the 2026 Annual Meeting: C. David Allen, Jr.

  7. Independent Director Age: 60 Director Since: 2014 Committees Served: Audit Committee, Compensation Committee

    Independent Director Age: 60 Director Since: 2014 Committees Served: Audit Committee, Compensation Committee Since March 2024, Mr. Allen has served as Chief Financial Officer of AB Staffing Solutions, a provider of healthcare solutions to commercial and government customers across the United States. Starting in 2022, Mr. Allen has served as Chief Financial Officer of Life Sciences Logistics, a Blackstone portfolio company. From 2016 to 2022, Mr. Allen has served as Chief Financial Officer of Smart Start, LLC, a provider of automotive technology products. Prior to Smart Start, from 2015 to 2016, Mr. Allen has served as Chief Financial Officer of Graebel Vanlines Holdings, LLC, a provider of commercial and residential logistics, moving and storage services. Prior to Graebel, from 2009 to 2015, Mr. Allen served as an officer of Snelling Services, LLC, a workforce solutions provider. From 2010 to 2015, Mr. Allen served as President and Chief Executive Officer. From 2009 to 2010 he served as Chief Financial Officer. Prior to Snelling, Mr. Allen served for three years as Chief Operating Officer and six years as Chief Financial Officer for Telvista Inc., a business process outsourcer providing customer relationship management solutions. He earned a Master of Business Administration degree from the Tuck School at Dartmouth College in 1993 and received a Bachelor of Business Administration from Stephen F. Austin State University with honors in 1986. Our Board benefits from Mr. Allen’s extensive experience in the workforce solutions industry as well as his financial expertise.

  8. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION Set forth below is a summary of the components of compensation payable to our non-management directors.

  9. Director Compensation for the 2023 Fiscal Year

    Director Compensation for the 2023 Fiscal Year The table below sets forth the compensation payable to our non-management directors for service during the 2023 fiscal year.

  10. Director Compensation for the 2023 Fiscal Year

    | Name(1) | Fees earned or paid in cash ($) | Stock awards ($) (*) | Option awards ($) (*) | Non-equity incentive plan compensation ($) | Nonqualified deferred compensation earnings ($) | All other compensation ($) | Total ($) | | C. David Allen, Jr. | $50,000 | $66,788 | $8,831 | $— | $— | $— | $125,619 | | Richard L. Baum, Jr. | $50,000 | $66,788 | $8,831 | $— | $— | $— | $125,619 | | Donna Carroll | $41,250 | $19,684 | $1,958 | $— | $— | $— | $62,892 | | Douglas E. Hailey | $50,000 | $66,788 | $8,831 | $— | $— | $— | $125,619 | | Cynthia Marshall | $45,000 | $66,788 | $7,051 | $— | $— | $— | $118,839 | | Paul A. Seid | $45,000 | $66,788 | $8,831 | $— | $— | $— | $120,619 |

  11. Director Compensation for the 2023 Fiscal Year

    (*) The amounts reflect the dollar amounts recognized for financial statement reporting purposes in accordance with FASB ASC Topic 718. The assumptions used in the calculation of these amounts are included in Note 16 Share-based Compensation to the audited consolidated financial statements included in the Form 10-K.

  12. Summary Compensation Table

    Summary Compensation Table The following table presents compensation information for our named executive officers with respect to the 2023 and 2022 fiscal years.

  13. Summary Compensation Table

    | Name and Principal Position (3) | Year | Salary ($) | Bonus ($) | Stock Awards ($) (*) | Option Awards ($) (*) | Non-equity incentive plan compensation ($) | Non-qualified deferred compensation earnings ($) | All Other Compensation ($) | Total ($) | | Beth Garvey Chair, President and Chief Executive Officer | 2023 | $450,500 | $45,543 | $70,067 | $109,317 | $— | $— | $17,188(1) | $692,615 | | | 2022 | $425,000 | $297,500 | $79,598 | $203,268 | $— | $— | $15,521(1) | $1,020,887 | | | 2021 | $425,000 | $188,388 | $28,922 | $102,816 | $— | $— | $14,857(1) | $759,983 | | 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 | | | 2021 | $320,000 | $146,388 | $33,373 | $82,648 | $— | $— | $10,400(1) | $592,809 | | John Barnett Chief Financial Officer and Secretary (March 2023) | 2023 | $282,692 | $— | $17,114 | $12,382 | $— | $— | $2,692(1) | $314,880 |

  14. Summary Compensation Table

    (*)The amounts reflect the dollar amounts recognized for financial statement reporting purposes in accordance with FASB ASC Topic 718. The assumptions used in the calculation of these amounts are included in Note 16 Share-based Compensation to the audited consolidated financial statements included in the Form 10-K. (1)Represents the matching 401(k) contributions made by us.

  15. Pay Versus Performance

    Pay Versus Performance The following table reports the compensation of our Principal Executive Officer (“PEO”)(1) and the compensation of the other named executive officers1 as reported in the Summary Compensation Table for the past three fiscal years, as well as the “compensation actually paid” (“CAP”) as calculated pursuant to recently adopted SEC rules and certain performance measures required by the rules.

  16. Pay Versus Performance

    | | | | | | Value of Initial Fixed $100 Investment Based on: | | | | Year | Summary Comp Table(SCI) - PEO | Compensation Actually Paid (CAP)PEO(2) | SCI Non-PEO NEO | CAP -Non-PEO NEO2 | Total Shareholder Return | Peer Group Shareholder Return(3) | Net Income (in thousands) | | 2023 | $692,615 | $699,764 | $787,227 | $809,259 | $57.08 | $116.94 | $(10,223) | | 2022 | $1,020,887 | $988,836 | $729,223 | $711,872 | $117.64 | $134.46 | $25,361 | | 2021 | $759,983 | $1,018,711 | $592,809 | $775,175 | $102.82 | $141.36 | $14,109 |

  17. Pay Versus Performance

    (1) During 2021-2023, Beth Garvey served as President and Chief Executive Officer, and Dan Hollenbach served as the Chief Financial Officer and Secretary, and the only other named executive officer (the “Non-PEO NEO”). During 2023, Beth Garvey served as President and Chief Executive Officer, Dan Hollenbach served as the Chief Financial Officer and Secretary (until March 2023), John Barnett served as the Chief Financial Officer and Secretary (March 2023 - December 2023). (2) The SEC rules require that certain adjustments be made to the Summary Compensation Table totals to determine CAP, as reported in the Pay Versus Performance table above. The applicable adjustments that were made to determine CAP for the PEO are summarized in the tables below. (3) The peer group used for calculating Peer Group Total Shareholder Return consists of the following corporations providing temporary or permanent employment services: Mastech Digital, GEE Group Inc, Staffing 360 Solutions; and Resources Connection Inc. This is the same group of companies used to prepare the Stock Performance Graph disclosed in the Form 10-K.

  18. Pay Versus Performance

    | Year | Summary Comp Table | Subtract: Stock Awards in Summary Comp Table | Add fair value of all awards granted during the fiscal year that are outstanding and unvested | Add the change in the fair value of any awards granted in any prior fiscal year that are outstanding and unvested | Add the fair value of awards that are granted and vest in the same year | Add the change in fair value of any awards granted in any prior fiscal year that vested | Subtract the fair value of any awards granted in any prior fiscal year that fail to meet the applicable vesting conditions | Add any dividends or other earnings paid on awards that are not otherwise included in the total compensation for the covered fiscal year | Compensation Actually Paid (CAP) | | Beth Garvey PEO | | | | | | | | | | | 2023 | $692,615 | $(70,067) | $18,010 | $— | $59,206 | $— | $— | $— | $699,764 | | 2022 | $1,020,887 | $(79,598) | $28,802 | $— | $18,745 | $— | $— | $— | $988,836 | | 2021 | $759,983 | $(28,922) | $210,150 | $19,650 | $57,850 | $— | $— | $— | $1,018,711 | | Dan Hollenbach NEO(through March 2023) | | | | | | | | | | | 2023 | $472,347 | $(55,661) | $8,140 | $— | $26,742 | $— | $— | $— | $451,568 | | 2022 | $729,223 | $(64,898) | $28,802 | $— | $18,745 | $— | $— | $— | $711,872 | | 2021 | $592,809 | $(33,373) | $157,613 | $14,738 | $43,388 | $— | $— | $— | $775,175 | | John Barnett NEO (Beginning March 2023) | | | | | | | | | | | 2023 | $314,880 | $(17,114) | $59,925 | $— | $— | $— | $— | $— | $357,691 |

  19. Pay Versus Performance

    The following charts reflect how the CAP over the 3 year period ended December 31, 2023 aligns to trends in the Company's Total Shareholder Return and Net Income of the Company during the same period.

  20. Outstanding Equity Awards

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

  21. Outstanding Equity Awards

    | Name | Option Awards | | | | | | Stock Awards | | | | Grant date | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Equity incentive plan awards: Number of securities underlying unexercised unearned options (#) | Option exercise price ($) | Option expiration date | Number of Shares or Units of Stock that Have Not Vested (#) | Market Value of Shares or Units of Stock that Have Not Vested ($) | | (a) | | (b) | (c) | (d) | (e) | (f) | (g) | (h) | | Beth Garvey | 09/01/2023 | 10,000 | 31,007(1) | — | $9.66 | 09/01/2033 | — | — | | | 09/01/2023 | — | 8,993(2) | — | $9.66 | 09/01/2033 | — | — | | | 02/17/2023 | — | — | — | $— | — | 3,832(15) | $58,323 | | | 02/17/2023 | 871 | 2,613(3) | — | $15.07 | 2/17/2033 | — | — | | | 02/17/2023 | — | 871(4) | — | $15.07 | 2/17/2033 | — | — | | | 08/03/2022 | 5,065 | 18,807(5) | — | $12.87 | 08/03/2032 | — | — | | | 08/03/2022 | 14,935 | 11,193(6) | — | $12.87 | 08/03/2032 | — | — | | | 05/04/2022 | — | — | — | $— | — | 1,880(16) | $18,236 | | | 08/04/2021 | 3,600 | 2,400(7) | — | $11.57 | 08/04/2031 | — | — | | | 08/04/2021 | 4,000 | — | — | $11.57 | 08/04/2031 | — | — | | | 08/04/2021 | — | — | — | $— | — | 5,000(17) | $49,250 | | | 08/04/2020 | 3,600 | — | — | $9.72 | 08/04/2030 | — | — | | | 08/04/2020 | 1,200 | 1,200(8) | — | $9.72 | 08/04/2030 | — | — | | | 09/24/2018 | 6,148 | — | — | $25.71 | 09/24/2028 | — | — | | | 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 | | | 02/17/2023 | 394 | 1,573(11) | — | $15.07 | 02/17/2033 | | | | | 08/03/2022 | 2,000 | — | — | $12.87 | 08/03/2032 | — | — | | | 08/03/2022 | 2,000 | 6,000(12) | — | $12.87 | 08/03/2032 | — | — | | | 05/04/2022 | — | — | — | $— | — | 1,880(16) | $18,236 | | | 08/04/2021 | 1,000 | 2,000(13) | — | $11.57 | 08/04/2031 | — | — | | | 08/04/2021 | 2,000 | — | — | $11.57 | 08/04/2031 | — | — | | | 08/04/2021 | — | — | — | $— | — | 3,750(20) | $36,938 | | | 08/04/2020 | 2,700 | — | — | $9.72 | 08/04/2030 | — | — | | | 08/04/2020 | 900 | 900(14) | — | $9.72 | 08/04/2030 | — | — | | | 09/24/2018 | 8,408 | — | — | $25.71 | 09/24/2028 | — | — | | | 09/24/2018 | 66,592 | — | — | $25.71 | 09/24/2028 | — | — | | | 06/07/2017 | 5,000 | — | — | $16.76 | 06/07/2027 | — | — | | | 06/07/2017 | 7,500 | — | — | $16.76 | 06/07/2027 | — | — | | | 10/27/2015 | 17,012 | — | — | $11.07 | 10/27/2025 | — | — | | | 10/27/2015 | 19,835 | — | — | $11.07 | 10/27/2025 | — | — |

  22. Outstanding Equity Awards

    (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. (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 BGSF 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.