DISCONTINUED OPERATIONS

9 Months Ended

Sep. 28, 2025

Discontinued Operations and Disposal Groups [Abstract]

On June 14, 2025, the Company entered into an Equity Purchase Agreement (“EPA”) with INSPYR Solutions Intermediate, LLC (“INSPYR”), pursuant to which the Company sold to INSPYR substantially all of the outstanding equity and assets interest pertaining to BGSF Professional. The sale closed on September 8, 2025, for cash proceeds of $91.5 million (which includes a $2.3 million working capital adjustment as provided in the EPA) plus $5.2 million in holdback escrow accounts. Under the terms of the EPA, INSPYR acquired certain assets and equity interests, and assumed certain liabilities and obligations of the Company pertaining to BGSF Professional.

The EPA contained customary representations and warranties, covenants (including certain non-competition and non-solicitation covenants restricting the Company with respect to the professional staffing business), closing conditions, and indemnification provisions. The EPA also included a payment obligation related to the June 10, 2025 letter agreement with Arroyo Consulting, LLC related to the payout of $2.5 million in contingent consideration where by the Company assumed a portion of this obligation and paid $1.2 million at closing and the remaining $0.6 million in monthly installments. After the close of the transaction, the Company began providing certain back-office services to INSPYR for a limited period of time.

The BGSF Professional financial results for periods prior to the sale have been reflected in our Unaudited Consolidated Balance Sheet, Unaudited Consolidated Statements of Operations, Unaudited Consolidated Statement of Changes in Stockholders’ Equity and Unaudited Consolidated Statements of Cash Flows as discontinued operations.

The financial results of BGSF Professional are as follows (in thousands):


		Thirteen Weeks Ended				Thirty-nine Weeks Ended
		September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024
Revenue		$	29,490	$	41,362	$	112,109	$	127,992
Cost of services		20,325		27,730		77,340		86,231
	Gross profit	9,165		13,632		34,769		41,761
Selling, general, and administrative expenses		7,590		10,602		27,497		32,184
Gain on contingent consideration		450		—		—		—
Depreciation and amortization		899		1,557		3,577		4,874

	Income from discontinued operations before taxes	$	226	$	1,473	$	3,695	$	4,703

The preliminary carrying amount of assets, liabilities, and equity included as part of discontinued operations (in thousands):