Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ................................ to ...............................................

Commission File Number 001-36267

BLUE BIRD CORPORATION

(Exact name of registrant as specified in its charter)

Delaware 46-3891989

(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

3920 Arkwright Road, 2nd Floor, Macon, Georgia 31210

(Address of principal executive offices and zip code)

(478) 822-2801

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, $0.0001 par value

BLBD

NASDAQ Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated Filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At May 3, 2024, 32,299,065 shares of the registrant’s common stock, $0.0001 par value, were outstanding.

BLUE BIRD CORPORATION

FORM 10-Q

TABLE OF CONTENTS



PART I – FINANCIAL INFORMATION			2
Item 1. Financial Statements (Unaudited)			2
Condensed Consolidated Balance Sheets			2
Condensed Consolidated Statements of Operations			3
Condensed Consolidated Statements of Comprehensive Income (Loss)			4
Condensed Consolidated Statements of Cash Flows			5
Condensed Consolidated Statements of Stockholders' Equity (Deficit)			7
Notes to Condensed Consolidated Financial Statements			9
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.			19
Item 3. Quantitative and Qualitative Disclosures About Market Risk.			34
Item 4. Controls and Procedures.			34
PART II – OTHER INFORMATION			36
Item 1. Legal Proceedings.			36
Item 1A. Risk Factors.			36

Item 5. Other Information.			36
Item 6. Exhibits.			37
SIGNATURES			38

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(in thousands of dollars, except for share data)	March 30, 2024		September 30, 2023
Assets
Current assets
Cash and cash equivalents	$	93,096	$	78,988
Accounts receivable, net	11,425		12,574
Inventories	145,401		135,286
Other current assets	19,495		9,215
Total current assets	$	269,417	$	236,063

Property, plant and equipment, net	$	94,487	$	95,101
Goodwill	18,825		18,825
Intangible assets, net	44,489		45,424
Equity investment in affiliate	25,948		17,619
Deferred tax assets	—		2,182
Finance lease right-of-use assets	683		1,034
Other assets	2,633		1,518
Total assets	$	456,482	$	417,766
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable	$	138,847	$	137,140
Warranty	6,779		6,711
Accrued expenses	37,549		32,894
Deferred warranty income	8,721		8,101
Finance lease obligations	898		583
Other current liabilities	21,973		24,391
Current portion of long-term debt	5,000		19,800
Total current liabilities	$	219,767	$	229,620
Long-term liabilities
Revolving credit facility	$	—	$	—
Long-term debt	92,322		110,544
Warranty	8,697		8,723
Deferred warranty income	16,842		15,022
Deferred tax liabilities	2,238		2,513
Finance lease obligations	380		987
Other liabilities	8,317		7,955
Pension	2,131		2,404
Total long-term liabilities	$	130,927	$	148,148
Guarantees, commitments and contingencies (Note 6)
Stockholders' equity
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 0 shares outstanding at March 30, 2024 and September 30, 2023	$	—	$	—
Common stock, $0.0001 par value, 100,000,000 shares authorized, 32,299,065 and 32,165,225 shares outstanding at March 30, 2024 and September 30, 2023, respectively	3		3
Additional paid-in capital	191,216		177,861
Accumulated deficit	(3,527)		(55,700)
Accumulated other comprehensive loss	(31,622)		(31,884)
Treasury stock, at cost, 1,782,568 shares at March 30, 2024 and September 30, 2023	(50,282)		(50,282)
Total stockholders' equity	$	105,788	$	39,998
Total liabilities and stockholders' equity	$	456,482	$	417,766

The accompanying notes are an integral part of these condensed consolidated financial statements.

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	Three Months Ended				Six Months Ended
(in thousands of dollars except for share data)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Net sales	$	345,915	$	299,814	$	663,575	$	535,546
Cost of goods sold	282,276		264,165		536,378		492,440
Gross profit	$	63,639	$	35,649	$	127,197	$	43,106
Operating expenses
Selling, general and administrative expenses	27,571		23,205		53,173		40,037
Operating profit	$	36,068	$	12,444	$	74,024	$	3,069
Interest expense	(2,812)		(5,192)		(6,443)		(9,388)
Interest income	1,054		12		2,142		12
Other expense, net	(1,968)		(342)		(3,189)		(578)
Loss on debt refinancing or modification	—		—		(1,558)		(537)
Income (loss) before income taxes	$	32,342	$	6,922	$	64,976	$	(7,422)
Income tax (expense) benefit	(8,261)		(1,389)		(16,707)		1,592
Equity in net income of non-consolidated affiliate	1,942		1,597		3,904		1,666
Net income (loss)	$	26,023	$	7,130	$	52,173	$	(4,164)

Earnings (loss) per share:
Basic weighted average shares outstanding	32,240,458		32,033,709		32,205,657		32,029,999
Diluted weighted average shares outstanding	33,074,592		32,322,163		32,828,339		32,029,999
Basic earnings (loss) per share	$	0.81	$	0.22	$	1.62	$	(0.13)
Diluted earnings (loss) per share	$	0.79	$	0.22	$	1.59	$	(0.13)

The accompanying notes are an integral part of these condensed consolidated financial statements.

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Net income (loss)	$	26,023	$	7,130	$	52,173	$	(4,164)
Other comprehensive income, net of tax:
Net change in defined benefit pension plan	131		227		262		454

Total other comprehensive income	$	131	$	227	$	262	$	454
Comprehensive income (loss)	$	26,154	$	7,357	$	52,435	$	(3,710)

The accompanying notes are an integral part of these condensed consolidated financial statements.

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023
Cash flows from operating activities
Net income (loss)	$	52,173	$	(4,164)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization expense	7,255		7,068
Non-cash interest expense	219		777
Share-based compensation expense	4,543		1,288
Equity in net income of non-consolidated affiliate	(3,904)		(1,666)
Dividend from equity investment in affiliate	2,991		—
Loss on disposal of fixed assets	25		11


Deferred income tax expense (benefit)	1,825		(1,600)
Amortization of deferred actuarial pension losses	344		598
Loss on debt refinancing or modification	1,558		537
Changes in assets and liabilities:
Accounts receivable	1,149		(1,101)
Inventories	(10,115)		13,816
Other assets	(10,016)		(2,380)
Accounts payable	2,298		28,116
Accrued expenses, pension and other liabilities	4,426		3,416

Total adjustments	$	2,598	$	48,880
Total cash provided by operating activities	$	54,771	$	44,716
Cash flows from investing activities
Cash paid for fixed assets	$	(5,643)	$	(3,740)
Proceeds from sale of fixed assets	—		—
Total cash used in investing activities	$	(5,643)	$	(3,740)
Cash flows from financing activities
Revolving credit facility borrowings (Note 4)	$	36,220	$	35,000
Revolving credit facility repayments	(36,220)		(55,000)
Term loan borrowings - new credit agreement (Note 4)	100,000		—
Term loan repayments (Note 4)	(133,050)		(9,900)
Principal payments on finance leases	(292)		(281)
Cash paid for debt costs (Note 4)	(3,128)		(3,272)


Repurchase of common stock in connection with stock award exercises	(301)		(57)
Cash received from stock option exercises	1,751		66

Total cash used in financing activities	$	(35,020)	$	(33,444)
Change in cash, cash equivalents, and restricted cash	14,108		7,532
Cash, cash equivalents, and restricted cash at beginning of period	78,988		10,479
Cash, cash equivalents, and restricted cash at end of period	$	93,096	$	18,011


	Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023

Supplemental disclosures of cash flow information
Cash paid or received during the period:
Interest paid, net of interest received	$	3,678	$	8,125
Income tax paid (received), net of tax refunds	9,443		(52)
Non-cash investing and financing activities:
Changes in accounts payable for capital additions to property, plant and equipment	$	780	$	1,019





Right-of-use assets obtained in exchange for operating lease obligations	1,241		199
Warrants issued for equity investment in affiliate	7,416		—

The accompanying notes are an integral part of these condensed consolidated financial statements.

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

(Unaudited)


	Three Months Ended
(in thousands of dollars, except for share data)	Common Stock					Convertible Preferred Stock							Treasury Stock
	Shares	Par Value		Additional Paid-In-Capital		Shares	Amount		Accumulated Other Comprehensive Loss		Accumulated Deficit		Shares	Amount		Total Stockholders' Equity (Deficit)
Balance, December 30, 2023	32,198,592	$	3	$	187,159	—	$	—	$	(31,753)	$	(29,550)	1,782,568	$	(50,282)	$	75,577




Stock option activity	100,473	—		1,602		—	—		—		—		—	—		1,602

Share-based compensation expense	—	—		2,455		—	—		—		—		—	—		2,455



Net income	—	—		—		—	—		—		26,023		—	—		26,023
Other comprehensive income, net of tax	—	—		—		—	—		131		—		—	—		131
Balance, March 30, 2024	32,299,065	$	3	$	191,216	—	$	—	$	(31,622)	$	(3,527)	1,782,568	$	(50,282)	$	105,788

Balance, December 31, 2022	32,032,067	$	3	$	173,592	—	$	—	$	(41,703)	$	(90,806)	1,782,568	$	(50,282)	$	(9,196)



Stock option activity	4,082	—		66		—	—		—		—		—	—		66

Share-based compensation expense	—	—		655		—	—		—		—		—	—		655


Net income	—	—		—		—	—		—		7,130		—	—		7,130
Other comprehensive income, net of tax	—	—		—		—	—		227		—		—	—		227
Balance, April 1, 2023	32,036,149	$	3	$	174,313	—	$	—	$	(41,476)	$	(83,676)	1,782,568	$	(50,282)	$	(1,118)


	Six Months Ended
(in thousands of dollars, except for share data)	Common Stock					Convertible Preferred Stock							Treasury Stock
	Shares	Par Value		Additional Paid-In-Capital		Shares	Amount		Accumulated Other Comprehensive Loss		Accumulated Deficit		Shares	Amount		Total Stockholders' Equity (Deficit)
Balance, September 30, 2023	32,165,225	$	3	$	177,861	—	$	—	$	(31,884)	$	(55,700)	1,782,568	$	(50,282)	$	39,998
Issuance of warrants (Note 12)	—	—		7,416		—	—		—		—		—	—		7,416

Restricted stock activity	22,115	—		(301)		—	—		—		—		—	—		(301)
Stock option activity	111,725	—		1,751		—	—		—		—		—	—		1,751

Share-based compensation expense	—	—		4,489		—	—		—		—		—	—		4,489



Net income	—	—		—		—	—		—		52,173		—	—		52,173
Other comprehensive income, net of tax	—	—		—		—	—		262		—		—	—		262
Balance, March 30, 2024	32,299,065	$	3	$	191,216	—	$	—	$	(31,622)	$	(3,527)	1,782,568	$	(50,282)	$	105,788

Balance, October 1, 2022	32,024,911	$	3	$	173,103	—	$	—	$	(41,930)	$	(79,512)	1,782,568	$	(50,282)	$	1,382


Restricted stock activity	7,156	—		(57)		—	—		—		—		—	—		(57)
Stock option activity	4,082	—		66		—	—		—		—		—	—		66

Share-based compensation expense	—	—		1,201		—	—		—		—		—	—		1,201



Net loss	—	—		—		—	—		—		(4,164)		—	—		(4,164)
Other comprehensive income, net of tax	—	—		—		—	—		454		—		—	—		454
Balance, April 1, 2023	32,036,149	$	3	$	174,313	—	$	—	$	(41,476)	$	(83,676)	1,782,568	$	(50,282)	$	(1,118)

The accompanying notes are an integral part of these consolidated financial statements.

BLUE BIRD CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Nature of Business and Basis of Presentation

Nature of Business

Blue Bird Body Company ("BBBC"), a wholly-owned subsidiary of Blue Bird Corporation, was incorporated in 1958 and has manufactured, assembled and sold school buses to a variety of municipal, federal and commercial customers since 1927. The majority of BBBC’s sales are made to an independent dealer network, which in turn sells buses to ultimate end users. References in these notes to condensed consolidated financial statements to “Blue Bird,” the “Company,” “we,” “our,” or “us” relate to Blue Bird Corporation and its wholly-owned subsidiaries, unless the context specifically indicates otherwise. We are headquartered in Macon, Georgia.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company transactions and accounts have been eliminated in consolidation.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting and Article 10 of Regulation S-X. The Company’s fiscal year ends on the Saturday closest to September 30 with its quarters consisting of thirteen weeks in most years. The fiscal years ending September 28, 2024 ("fiscal 2024") and ended September 30, 2023 ("fiscal 2023") consist or consisted of 52 weeks. The second quarters of fiscal 2024 and fiscal 2023 both included 13 weeks. The six month periods in fiscal 2024 and 2023 both included 26 weeks.

In the opinion of management, all adjustments considered necessary for a fair presentation of financial results have been made. Such adjustments consist of only those of a normal recurring nature. Operating results for any interim period are not necessarily indicative of the results that may be expected for the entire year. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.

The Condensed Consolidated Balance Sheet data as of September 30, 2023 was derived from the Company’s audited financial statements but does not include all disclosures required by U.S. GAAP. For additional information, including the Company’s significant accounting policies, refer to the consolidated financial statements and related footnotes as of and for the fiscal year ended September 30, 2023 as set forth in the Company's fiscal 2023 Form 10-K filed with the Securities and Exchange Commission ("SEC") on December 11, 2023.

Impacts of COVID-19 and Subsequent Supply Chain Constraints on our Business

As discussed in detail in the fiscal 2023 Form 10-K filed with the SEC on December 11, 2023, the novel coronavirus known as "COVID-19" materially affected demand for new buses and replacement/maintenance parts during the second half of our fiscal year that ended October 3, 2020 ("fiscal 2020") and first half of our fiscal year that ended October 2, 2021 ("fiscal 2021"), significantly impacting our business and operations. Although demand for school buses strengthened substantially during the second half of fiscal 2021, the Company, and automotive industry as a whole, began experiencing significant supply chain constraints around this same period of time. These supply chain disruptions had a significant adverse impact on our operations and results during the second half of fiscal 2021 and all of fiscal 2022 due to higher purchasing costs, including freight costs incurred to expedite receipt of critical components, increased manufacturing inefficiencies and our inability to complete the production of buses to fulfill sales orders.

Additionally, Russian military forces launched a large-scale invasion of Ukraine on February 24, 2022, which further exacerbated global supply chain disruptions. While the Company has no assets or customers in either of these countries, this military conflict has significantly impacted our financial results, primarily in an indirect manner since the Company does not sell to customers located in, or source goods directly from, either country. Specifically, it contributed to increased a) costs charged by suppliers for the purchase of inventory that is at least partially dependent on resources originating from either of the countries and b) freight costs, both of which negatively impacted the gross profit recognized on sales during fiscal 2022, fiscal 2023 and continuing into fiscal 2024.

the increases in sales prices that we charged for the buses that were sold during the first quarter of fiscal 2023, many of which were included in the backlog of fixed price sales orders originating in fiscal 2021 and the early months of fiscal 2022 that carried forward into fiscal 2023. During the remainder of fiscal 2023, the buses that were sold were generally included in the backlog of fixed price sales orders originating more recently (i.e., the latter months of fiscal 2022 and in fiscal 2023), with the cumulative increases in sales prices we charged for those buses generally outpacing the higher costs we paid to procure inventory, resulting in gross profit during the quarters. While the gross margin on bus sales during the second quarter of fiscal 2023 lagged the historical gross margin reported prior to the COVID-19 pandemic, it returned to more normal historical levels during the latter half of fiscal 2023.

Supply chain disruptions continued into the first half of fiscal 2024 as there were still occasional shortages of certain critical components as well as ongoing increases in raw materials costs, both of which impacted our business and operations by limiting the number of school buses that we could produce and sell as well as increasing the costs to manufacture buses. Nonetheless, the lessons learned, and resulting actions taken, by management over the past three fiscal years allowed the Company to better navigate these supply chain challenges and consistently produce buses to fulfill sales orders. Ongoing improvements in manufacturing operations, when coupled with periodic pricing actions taken by the Company to ensure that the increased sales prices charged for buses kept pace with increased costs to procure inventory to produce the buses, allowed the Company to report gross profit and gross margin during the first half of fiscal 2024 that were consistent with, or better than, historic levels experienced prior to the COVID-19 pandemic.

Use of Estimates and Assumptions

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions. At the date of the financial statements, these estimates and assumptions affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities, and during the reporting period, these estimates and assumptions affect the reported amounts of revenues and expenses. For example, significant management judgments are required in determining excess, obsolete, or unsalable inventory; the allowance for doubtful accounts; potential impairment of long-lived assets, goodwill and intangible assets; and the accounting for self-insurance reserves, warranty reserves, pension obligations, income taxes, environmental liabilities and contingencies. Future events, including the extent and duration of continued supply chain constraints and their related economic impacts, and their effects cannot be predicted with certainty, and, accordingly, the Company’s accounting estimates require the exercise of judgment. The accounting estimates used in the preparation of the Company’s condensed consolidated financial statements may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. The Company evaluates and updates its assumptions and estimates on an ongoing basis and may employ outside experts to assist in the Company’s evaluations. Actual results could differ from the estimates that the Company has used.

2. Summary of Significant Accounting Policies and Recently Issued Accounting Standards

The Company’s significant accounting policies are described in the Company’s fiscal 2023 Form 10-K, filed with the SEC on December 11, 2023. Our senior management has reviewed these significant accounting policies and related disclosures and determined that there were no significant changes in our critical accounting policies in the six months ended March 30, 2024.

Recently Issued Accounting Standards

ASU 2023-07 On November 27, 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments’ significant expenses on an interim and annual basis. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024, with early adoption permitted.

ASU 2023-09 On December 14, 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires entities to disclose more detailed information in their reconciliation of their statutory tax rate to their effective tax rate. Public business entities ("PBEs") are required to provide this incremental detail in a numerical, tabular format. The ASU also requires entities to disclose more detailed information about income taxes paid, including by jurisdiction; pretax income (or loss) from continuing operations; and income tax expense (or benefit). The ASU is effective for PBEs in fiscal years beginning after December 15, 2024, and interim periods beginning after December 15, 2025, with early adoption permitted.

The new ASUs will not impact amounts recorded in the financial statements but instead, will require more detailed disclosures in the footnotes to the financial statement. The Company plans to provide the updated disclosures required by the ASUs in the periods in which they are effective.

3. Supplemental Financial Information

Inventories

The following table presents the components of inventories at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Raw materials	$	99,019	$	88,116
Work in process	36,982		45,875
Finished goods	9,400		1,295
Total inventories	$	145,401	$	135,286

Restricted Cash

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the applicable Condensed Consolidated Balance Sheets that sum to the total of such amounts reported on the Condensed Consolidated Statements of Cash Flows:


(in thousands of dollars)	March 30, 2024		April 1, 2023
Cash and cash equivalents	$	93,096	$	17,773
Restricted cash	—		238
Total cash, cash equivalents, and restricted cash reported on the Condensed Consolidated Statements of Cash Flows	$	93,096	$	18,011

Amounts included in restricted cash represent those that were required by a contractual agreement with a financial institution to serve as collateral against outstanding balances pertaining to the Company's corporate credit card program.

Product Warranties

The following table reflects activity in accrued warranty cost (current and long-term portions combined) for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Balance at beginning of period	$	15,283	$	15,580	$	15,434	$	15,970
Add current period accruals	2,512		2,432		4,853		4,465
Current period reductions of accrual	(2,319)		(2,458)		(4,811)		(4,881)
Balance at end of period	$	15,476	$	15,554	$	15,476	$	15,554

Extended Warranties

The following table reflects activity in deferred warranty income (current and long-term portions combined), for the sale of extended warranties of two to five years, for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Balance at beginning of period	$	24,118	$	19,290	$	23,123	$	18,795
Add current period deferred income	3,562		2,756		6,560		5,092
Current period recognition of income	(2,117)		(1,965)		(4,120)		(3,806)
Balance at end of period	$	25,563	$	20,081	$	25,563	$	20,081

The outstanding balance of deferred warranty income in the table above is considered a "contract liability," and represents a performance obligation of the Company that we satisfy over the term of the arrangement but for which we have been paid in full at the time the warranty was sold. We expect to recognize $4.5 million of the outstanding contract liability during the remainder of fiscal 2024, $7.8 million in fiscal 2025, and the remaining balance thereafter.

Self-Insurance

The following table reflects our total accrued self-insurance liability, comprised of workers' compensation and health insurance related claims, at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Current portion	$	5,247	$	4,475
Long-term portion	2,348		1,771
Total accrued self-insurance	$	7,595	$	6,246

The current and long-term portions of the accrued self-insurance liability are reflected in accrued expenses and other liabilities, respectively, on the Condensed Consolidated Balance Sheets.

Shipping and Handling Revenues

Shipping and handling revenues were $5.0 million and $4.2 million for the three months ended March 30, 2024 and April 1, 2023, respectively, and $9.7 million and $8.5 million for the six months ended March 30, 2024 and April 1, 2023, respectively. The related cost of goods sold was $4.4 million and $3.9 million for the three months ended March 30, 2024 and April 1, 2023, respectively, and $8.7 million and $7.7 million for the six months ended March 30, 2024 and April 1, 2023, respectively.

Pension Expense

Components of net periodic pension benefit expense were as follows for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Interest cost	$	1,484	$	1,509	$	2,968	$	3,018
Expected return on plan assets	(1,620)		(1,630)		(3,240)		(3,260)
Amortization of prior loss	172		299		344		598
Net periodic pension benefit expense	$	36	$	178	$	72	$	356
Amortization of prior loss, recognized in other comprehensive income	(172)		(299)		(344)		(598)
Total recognized in net periodic pension benefit expense and other comprehensive income	$	(136)	$	(121)	$	(272)	$	(242)

4. Debt

On November 17, 2023 (the “Closing Date”), BBBC, as Borrower, executed a $250.0 million five-year credit agreement with Bank of Montreal, acting as administrative agent and an issuing bank; several joint lead arranger partners and issuing banks, including Bank of America; and a syndicate of other lenders (the "Credit Agreement").

The credit facilities provided for under the Credit Agreement consist of a term loan facility in an aggregate initial principal amount of $100.0 million (the “Term Loan Facility”) and a revolving credit facility with aggregate commitments of $150.0 million. The revolving credit facility includes a $25.0 million letter of credit sub-facility and $5.0 million swingline sub-facility (the “Revolving Credit Facility,” and together with the Term Loan Facility, each a “Credit Facility” and collectively, the “Credit Facilities”).

A minimum of $100.0 million of additional term loans and/or revolving credit commitments may be incurred under the Credit Agreement, subject to certain limitations as set forth in the Credit Agreement, and which additional loans and/or commitments would require further commitments from existing lenders or from new lenders.

Borrower has the right to prepay the loans outstanding under the Credit Facilities without premium or penalty (subject to customary breakage costs, if applicable). Additionally, proceeds from asset sales, condemnation, casualty insurance and/or debt issuances (in certain circumstances) are required to be used to prepay borrowings outstanding under the Credit Facilities. Borrowings under the Term Loan Facility, which were made on the Closing Date, may not be reborrowed once they are repaid while borrowings under the Revolving Credit Facility may be repaid and reborrowed from time to time at our election.

aggregate principal amount outstanding under the Term Loan Facility, as well as any outstanding borrowings under the Revolving Credit Facility, will be payable on the November 17, 2028 maturity date of the Credit Agreement.

The Credit Facilities are guaranteed by all of the Company’s wholly-owned domestic restricted subsidiaries (subject to customary exceptions) and are secured by a security agreement which pledges a lien on virtually all of the assets of Borrower, the Company and the Company’s other wholly-owned domestic restricted subsidiaries, other than any owned or leased real property and subject to customary exceptions.

The $100.0 million of Term Loan Facility proceeds and $36.2 million of Revolving Credit Facility proceeds that were borrowed on the Closing Date were used to pay (i) the $131.8 million of term loan indebtedness outstanding under the previous credit agreement ("Amended Credit Agreement"), (ii) interest and commitment fees accrued under the Amended Credit Agreement through the Closing Date and (iii) transaction costs associated with the consummation of the Credit Agreement.

Under the terms of the Credit Agreement, Borrower, the Company and the Company’s other wholly-owned domestic restricted subsidiaries are subject to customary affirmative and negative covenants and events of default for facilities of this type (with customary grace periods, as applicable, and lender remedies).

Borrowings under the Credit Facilities bear interest, at our option, at (i) base rate ("ABR") or (ii) the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York ("SOFR") plus 0.10%, plus an applicable margin depending on the Total Net Leverage Ratio ("TNLR," which is defined in the Credit Agreement as the ratio of consolidated net debt to consolidated EBITDA on a trailing four quarter basis) of the Company as follows:


Level	TNLR	ABR Loans	SOFR Loans
I	Less than 1.00x	0.75%	1.75%
II	Greater than or equal to 1.00x and less than 1.50x	1.50%	2.50%
III	Greater than or equal to 1.50x and less than 2.25x	2.00%	3.00%
IV	Greater than or equal to 2.25x	2.25%	3.25%

Pricing on the Closing Date was set at Level III until receipt of the financial information and related compliance certificate for the first fiscal quarter that ended after the Closing Date, with pricing as of March 30, 2024 set at Level I.

Borrower is also required to pay lenders an unused commitment fee of between 0.25% and 0.45% per annum on the undrawn commitments under the Revolving Credit Facility, depending on the TNLR, quarterly in arrears.

The Credit Agreement also includes a requirement that the Company comply with the following financial covenants on the last day of each fiscal quarter through maturity: (i) a pro forma TNLR of not greater than 3.00:1.00 and (ii) a pro forma fixed charge coverage ratio (as defined in the Credit Agreement) of not less than 1.20:1.00. The Company was in compliance with such covenants as of March 30, 2024.

The Company incurred approximately $3.1 million in lender fees and other issuance costs relating to the Credit Agreement. Of such total, approximately $1.9 million and $0.8 million was capitalized within other assets and long-term debt (as a contra-balance), respectively, on the Condensed Consolidated Balance Sheets and will be amortized as an adjustment to interest expense on a straight-line basis and utilizing the effective interest method, respectively, until maturity of the Credit Agreement. The remaining approximate $0.4 million was recorded to loss on debt refinancing or modification on the Condensed Consolidated Statements of Operations.

In conjunction with executing the Credit Agreement, previously capitalized lender fees and other issuance costs relating to the Amended Credit Agreement and incurred in prior periods totaling $1.1 million were also expensed to loss on debt refinancing or modification on the Condensed Consolidated Statements of Operations.

Term loan borrowings consisted of the following at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Term loan borrowings, net of deferred financing costs of $1,428 and $1,456, respectively	$	97,322	$	130,344
Less: current portion of long-term debt	5,000		19,800
Long-term debt, net of current portion	$	92,322	$	110,544

Term loan borrowings are recognized on the Condensed Consolidated Balance Sheets at the unpaid principal balance, and are not subject to fair value measurement; however, given the variable rates on the loans, the Company estimates that the unpaid principal balance approximates fair value. If measured at fair value in the financial statements, the term loans would be classified as Level 2 in

the fair value hierarchy. At March 30, 2024 and September 30, 2023, $98.8 million and $131.8 million, respectively, were outstanding on the term loans.

At March 30, 2024 and September 30, 2023, the stated interest rates on the term loans were 7.2% and 10.0%, respectively. At March 30, 2024 and September 30, 2023, the weighted-average annual effective interest rates for the term loans were 8.2% and 10.9%, respectively, which include amortization of the deferred financing costs.

At March 30, 2024, $6.7 million of letters of credit were outstanding, which reduces the availability on the revolving line of credit. There were no borrowings outstanding on the Revolving Credit Facility; therefore, the Company would have been able to borrow $143.3 million on the revolving line of credit.

Interest expense on all indebtedness was $2.8 million and $5.2 million for the three months ended March 30, 2024 and April 1, 2023, respectively, and $6.4 million and $9.4 million for the six months ended March 30, 2024 and April 1, 2023, respectively.

The schedule of remaining principal payments through maturity for the term loans is as follows:


(in thousands of dollars)
Fiscal Year	Principal Payments
2024	$	2,500
2025	5,000
2026	5,000
2027	5,000
2028	5,000
Thereafter	76,250
Total remaining principal payments	$	98,750

5. Income Taxes

Income tax provisions for interim periods are based on estimated annual income tax rates, adjusted to reflect the effects of any significant infrequent or unusual items that are required to be discretely recognized within the current interim period. The effective tax rates in the periods presented are largely based upon the annual forecasted pre-tax earnings mix and allocation of certain expenses in various taxing jurisdictions where the Company conducts its business, primarily in the United States of America ("U.S."). In periods where our pre-tax income approximates or is equal to break-even, the effective tax rates for quarter-to-date and full-year periods may not be meaningful due to discrete period items.

Three Months

The effective tax rate for the three months ended March 30, 2024 was 25.5% and differed from the statutory federal income tax rate of 21%. The increase was primarily due to the impacts from state taxes and certain permanent items on the federal rate, which were partially offset by the impacts from federal and state tax credits (net of valuation allowances) and discrete period items during the quarter.

The effective tax rate for the three months ended April 1, 2023 was 20.1%, which aligned with the statutory federal income tax rate of 21% and is comprised of normal tax rate items, including impacts from state taxes and federal and state tax credits (net of valuation allowances), with discrete period items having a nominal impact on the effective rate during the quarter.

Six Months

The effective tax rate for the six months ended March 30, 2024 was 25.7% and differed from the statutory federal income tax rate of 21%. The increase was primarily due to the impacts from state taxes and certain permanent items on the federal rate, which were partially offset by the impacts from federal and state tax credits (net of valuation allowances) and discrete period items during the period.

The effective tax rate for the six months ended April 1, 2023 was 21.4%, which aligned with the statutory federal income tax rate of 21% and is comprised of normal tax rate items, including impacts from state taxes and federal and state tax credits (net of valuation allowances), with discrete period items having a nominal impact on the effective rate during the period.

6. Guarantees, Commitments and Contingencies

Litigation

At March 30, 2024, the Company had a number of product liability and other cases pending. Management believes that, considering the Company’s insurance coverage and its intention to vigorously defend its positions, the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial statements.

Environmental

The Company is subject to a variety of environmental regulations relating to the use, storage, discharge and disposal of hazardous materials used in its manufacturing processes. Failure by the Company to comply with present and future regulations could subject it to future liabilities. In addition, such regulations could require the Company to acquire costly equipment or to incur other significant expenses to comply with environmental regulations. The Company is currently not involved in any material environmental proceedings and therefore, management believes that the resolution of pending environmental matters will not have a material adverse effect on the Company’s financial statements.

7. Segment Information

We manage our business in two operating segments: (i) the Bus segment, which includes the manufacturing and assembly of buses to be sold to a variety of customers across the U.S., Canada and in certain limited international markets; and (ii) the Parts segment, which consists primarily of the purchase of parts from third parties to be sold to dealers within the Company’s network and certain large fleet customers. Management evaluates the segments based primarily upon revenues and gross profit, which are reflected in the tables below for the periods presented:


Net sales
	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Bus (1)	$	317,959	$	273,472	$	611,396	$	486,721
Parts (1)	27,956		26,342		52,179		48,825
Segment net sales	$	345,915	$	299,814	$	663,575	$	535,546

(1) Parts segment revenue includes $2.7 million and $1.3 million for the three months ended March 30, 2024 and April 1, 2023, respectively, and $4.3 million and $2.4 million for the six months ended March 30, 2024 and April 1, 2023, respectively, related to inter-segment sales of parts that was eliminated by the Bus segment upon consolidation.


Gross profit (loss)
	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Bus	$	49,589	$	23,099	$	100,883	$	19,368
Parts	14,050		12,550		26,314		23,738
Segment gross profit	$	63,639	$	35,649	$	127,197	$	43,106

The following table is a reconciliation of segment gross profit to consolidated income (loss) before income taxes for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Segment gross profit	$	63,639	$	35,649	$	127,197	$	43,106
Adjustments:
Selling, general and administrative expenses	(27,571)		(23,205)		(53,173)		(40,037)
Interest expense	(2,812)		(5,192)		(6,443)		(9,388)
Interest income	1,054		12		2,142		12
Other expense, net	(1,968)		(342)		(3,189)		(578)
Loss on debt refinancing or modification	—		—		(1,558)		(537)
Income (loss) before income taxes	$	32,342	$	6,922	$	64,976	$	(7,422)

Sales are attributable to geographic areas based on customer location and were as follows for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
U.S.	$	316,583	$	264,281	$	619,115	$	468,822
Canada	29,058		32,234		44,177		62,755
Rest of world	274		3,299		283		3,969
Total net sales	$	345,915	$	299,814	$	663,575	$	535,546

8. Revenue

The following table disaggregates revenue by product category for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Diesel buses	$	123,444	$	89,795	$	208,442	$	161,289
Alternative power buses (1)	180,162		171,269		375,491		303,215
Other (2)	14,991		13,040		28,688		23,495


Parts	27,318		25,710		50,954		47,547
Net sales	$	345,915	$	299,814	$	663,575	$	535,546

(1) Includes buses sold with any power source other than diesel (e.g., gasoline, propane, compressed natural gas ("CNG") or electric).

(2) Includes shipping and handling revenue, extended warranty income, surcharges and chassis and bus shell sales.

9. Earnings (Loss) Per Share

The following table presents the earnings (loss) per share computation for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands except for share data)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Numerator:
Net income (loss)	$	26,023	$	7,130	$	52,173	$	(4,164)

Denominator:
Weighted-average common shares outstanding	32,240,458		32,033,709		32,205,657		32,029,999
Weighted-average dilutive securities, restricted stock	390,498		270,156		283,078		—
Weighted-average dilutive securities, stock options	183,538		18,298		153,044		—
Weighted-average dilutive securities, warrants (Note 12)	260,098		—		186,560		—

Weighted-average shares and dilutive potential common shares (1)	33,074,592		32,322,163		32,828,339		32,029,999

Earnings (loss) per share:
Basic earnings (loss) per share	$	0.81	$	0.22	$	1.62	$	(0.13)
Diluted earnings (loss) per share	$	0.79	$	0.22	$	1.59	$	(0.13)

(1) Potentially dilutive securities representing approximately zero and 0.4 million shares of common stock were excluded from the computation of diluted earnings per share for the three months ending March 30, 2024 and April 1, 2023, respectively, and potentially dilutive securities representing approximately zero and 0.7 million shares of common stock were excluded from the computation of diluted earnings per share for the six months ending March 30, 2024 and April 1, 2023, respectively, as their effect would have been antidilutive.

10. Accumulated Other Comprehensive Loss

The following table provides information on changes in accumulated other comprehensive loss ("AOCL") for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	Defined Benefit Pension Plan		Total AOCL			Defined Benefit Pension Plan		Total AOCL
March 30, 2024
Beginning Balance	$	(31,753)	$	(31,753)		$	(31,884)	$	(31,884)

Amounts reclassified and included in earnings	172		172			344		344
Total before taxes	172		172			344		344
Income taxes	(41)		(41)			(82)		(82)
Ending Balance March 30, 2024	$	(31,622)	$	(31,622)		$	(31,622)	$	(31,622)

April 1, 2023
Beginning Balance	$	(41,703)	$	(41,703)		$	(41,930)	$	(41,930)

Amounts reclassified and included in earnings	299		299			598		598
Total before taxes	299		299			598		598
Income taxes	(72)		(72)			(144)		(144)
Ending Balance April 1, 2023	$	(41,476)	$	(41,476)		$	(41,476)	$	(41,476)

11. Stockholder Transaction Costs

On December 14, 2023, the Company entered into an underwriting agreement with BofA Securities, Inc. and Barclays Capital Inc., as representatives of the several underwriters and American Securities LLC ("Selling Stockholder"), pursuant to which the Selling Stockholder agreed to sell 2,500,000 shares of common stock at a purchase price of $25.10 per share (“December Offering”).

On February 15, 2024, the Company entered into an underwriting agreement with Barclays Capital Inc., as representative of the several underwriters and the Selling Stockholder, pursuant to which the Selling Shareholder agreed to sell 4,042,650 shares of common stock at a purchase price of $32.90 per share ("February Offering," and collectively with the December Offering, “Offerings”).

The December Offering was conducted pursuant to a prospectus supplement, dated December 14, 2023, and the February Offering was conducted pursuant to a prospectus supplement, dated February 15, 2024, both to the prospectus dated December 22, 2021 included in the Company’s registration statement on Form S-3 (File No. 333-261858) that was initially filed with the SEC on December 23, 2021.

The December Offering closed on December 19, 2023 and the February Offering closed on February 21, 2024. Although the Company did not sell any shares or receive any proceeds from the Offerings, it was required to pay certain expenses in connection with the Offerings that totaled approximately $1.9 million and $3.2 million for the three and six month periods ended March 30, 2024, with $0.7 million of similar expense recorded during both the three and six month periods ended April 1, 2023. The $1.9 million and $3.2 million of expense is included within other expense, net on the Condensed Consolidated Statements of Operations for the three and six month periods ended March 30, 2024, respectively, while the $0.7 million of expense is included within selling, general and administrative expenses on the Condensed Consolidated Statements of Operations for the three and six month periods ended April 1, 2023, but was subsequently reclassified to other expense, net, during the third quarter of fiscal 2023.

12. Joint Ventures

Micro Bird Holdings, Inc.

In December 2023, Micro Bird Holdings, Inc., our unconsolidated Canadian joint venture, paid dividends to all common stockholders, with the Company's proportionate share totaling $3.0 million, gross of required withholding taxes. The dividend was recorded as a reduction in the balance of equity investment in affiliate on the Condensed Consolidated Balance Sheets and is presented as a cash inflow in the operating section of the Condensed Consolidated Statements of Cash Flows.

Clean Bus Solutions, LLC

On December 7, 2023, the Company, through its wholly owned subsidiary, BBBC, and GC Mobility Investments I, LLC, a wholly owned subsidiary of Generate Capital, PBC (“Generate Capital”), a sustainable investment company focusing on clean energy, transportation, water, waste, agriculture, smart cities and industrial decarbonization, executed a definitive agreement (“Joint Venture Agreement”) establishing a joint venture, Clean Bus Solutions, LLC, to provide a fleet-as-a-service ("FaaS") offering using electric school buses manufactured and sold by the Company (“Joint Venture”). The service will be offered to qualified customers of the Company. Through the Joint Venture, the Company will provide its end customers with turnkey electrification solutions, including a wide product range consisting of, among others, electric school buses, financing of electric buses and supporting charging infrastructure, project planning and management, and fleet optimization.

The Company and Generate Capital will initially have an equal common ownership interest in the Joint Venture, and will initially jointly share management responsibility and control, with each party having certain customary consent and approval rights and control triggers. The parties have each agreed to contribute up to $10.0 million to the Joint Venture, as agreed from time to time, for common interests to fund administrative expenses, and up to an additional $100.0 million of capital in the form of preferred interests to fund the purchase, delivery, installation, operation and maintenance of FaaS projects, inclusive of Blue Bird electric school buses and associated charging infrastructure. Of this amount, the Company has committed to provide up to $20.0 million and Generate Capital has committed to provide up to $80.0 million, with the Company’s aggregate commitment in any one year not to exceed $10.0 million without its consent.

In accordance with the terms of the Joint Venture Agreement, the Company will promote the Joint Venture as the Company’s preferred FaaS offering for electric school buses and has agreed to not participate as a joint venture partner in any other similar FaaS offering for electric school buses, except as an original equipment manufacturer of buses. The Company’s obligations do not prevent or limit any activities of its dealers.

The Joint Venture has a perpetual duration subject to the right of either party to terminate early upon the occurrence of certain events of default or the failure to achieve certain milestones set forth in the terms of the Joint Venture Agreement.

In connection with the execution of the Joint Venture Agreement, the Company granted Generate Capital warrants to purchase an aggregate of 1,000,000 shares of Company common stock at an exercise price of $25.00 per share during a five-year exercise period (“Warrants”). Two-thirds of the Warrants were immediately exercisable while the remaining Warrants will become exercisable upon Generate Capital satisfying certain funding conditions. The exercise price and the number of shares issuable upon exercise of the Warrants are subject to adjustment in the event of a recapitalization, stock dividend or similar event.

The Company recorded the $7.4 million fair value of the Warrants upon issuance as permanent equity within additional paid-in capital on the Condensed Consolidated Balance Sheets and is not required to subsequently record changes in fair value as long as the Warrants continue to be classified within stockholders' equity. Additionally, since the Warrants were provided in exchange for an investment in the Joint Venture, the Company recorded the cost of its investment based on the fair value of the Warrants upon issuance, which increased the balance of equity investment in affiliate on the Condensed Consolidated Balance Sheets by a corresponding $7.4 million. No other activity was recorded relating to the Joint Venture during the three and six month periods ended March 30, 2024.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of financial condition and results of operations of Blue Bird Corporation (the "Company," "Blue Bird," "we," "our," or "us") should be read in conjunction with the Company’s unaudited condensed consolidated financial statements as of and for the three and six months ended March 30, 2024 and April 1, 2023 and related notes appearing in Part I, Item 1 of this Quarterly Report on Form 10-Q ("Report"). Our actual results may not be indicative of future performance. This discussion and analysis contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those discussed or incorporated by reference in the sections of this Report entitled “Special Note Regarding Forward-Looking Statements” and “Risk Factors.” Actual results may differ materially from those contained in any forward-looking statements. Certain monetary amounts, percentages and other figures included in this Report have been subject to rounding adjustments. Accordingly, figures shown as totals in certain tables may not be the arithmetic aggregation of the figures that precede them, and figures expressed as percentages in the text may not total 100% or, as applicable, when aggregated, may not be the arithmetic aggregation of the percentages that precede them.

Special Note Regarding Forward-Looking Statements

This Report contains forward-looking statements intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. Except as otherwise indicated by the context, references in this Report to “we,” “us” and “our” are to the consolidated business of the Company. All statements in this Report, including those made by the management of the Company, other than statements of historical fact, are forward-looking statements. These forward-looking statements are based on management’s estimates, projections and assumptions as of the date hereof and include the assumptions that underlie such statements. Forward-looking statements may contain words such as “may,” “will,” “should,” “could,” “would,” “expect,” “plan,” “estimate,” “project,” “forecast,” “seek,” “target,” “anticipate,” “believe,” “predict,” “potential” and “continue,” the negative of these terms, or other comparable terminology. Examples of forward-looking statements include statements regarding the Company’s future financial results, research and development results, regulatory approvals, operating results, business strategies, projected costs, products, competitive positions, management’s plans and objectives for future operations, and industry trends. These forward-looking statements relate to expectations for future financial performance, business strategies or expectations for our business. Specifically, forward-looking statements may include statements relating to:

•the future financial performance of the Company;

•negative changes in the market for Blue Bird products;

•expansion plans and opportunities;

•challenges or unexpected costs related to manufacturing;

•future impacts from the novel coronavirus pandemic known as "COVID-19," and any other pandemics, public health crises, or epidemics, on capital markets, manufacturing and supply chain abilities, consumer and customer demand, school system operations, workplace conditions, and any other unexpected impacts, which include or could include, among other effects:

◦disruption in global financial and credit markets;

◦supply shortages and supplier financial risk, especially from our single-source suppliers impacted by the pandemic;

◦negative impacts to manufacturing operations or the supply chain from shutdowns or other disruptions in operations;

◦negative impacts on capacity and/or production in response to changes in demand due to the pandemic, including possible cost containment actions;

◦financial difficulties of our customers impacted by the pandemic;

◦reductions in market demand for our products due to the pandemic; and

◦potential negative impacts of various actions taken by federal, state and/or local governments in response to the pandemic.

•future impacts resulting from Russia's invasion of Ukraine, which include or could include, among other effects:

◦disruption in global commodity and other markets;

◦supply shortages and supplier financial risk, especially from suppliers providing inventory that is dependent on resources originating from either of these countries; and

◦negative impacts to manufacturing operations resulting from inventory cost volatility or the supply chain due to shutdowns or other disruptions in operations.

These forward-looking statements are based on information available as of the date of this Report (or, in the case of forward-looking statements incorporated herein by reference, as of the date of the applicable filed document), and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different than those expressed or implied by these forward-looking statements.

Any expectations based on these forward-looking statements are subject to risks and uncertainties and other important factors, including those discussed in the reports we file with the Securities and Exchange Commission (“SEC”), specifically the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s fiscal 2023 Form 10-K, filed with the SEC on December 11, 2023. Other risks and uncertainties are and will be disclosed in the Company’s prior and future SEC filings. The following information should be read in conjunction with the financial statements included in the Company’s 2023 Form 10-K, filed with the SEC on December 11, 2023.

Available Information

We are subject to the reporting and information requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and as a result are obligated to file or furnish, as applicable, annual, quarterly, and current reports, proxy statements, and other information with the SEC. We make these documents available free of charge on our website (http://www.blue-bird.com) as soon as reasonably practicable after we electronically file them with, or furnish them to, the SEC. Information on our website does not constitute part of this Report. In addition, the SEC maintains a website (http://www.sec.gov) that contains our annual, quarterly, and current reports, proxy and information statements, and other information we electronically file with, or furnish to, the SEC.

Executive Overview

Blue Bird is the leading independent designer and manufacturer of school buses. Our longevity and reputation in the school bus industry have made Blue Bird an iconic American brand. We distinguish ourselves from our principal competitors by dedicating our focus to the design, engineering, manufacture and sale of school buses, and related parts. As the only principal manufacturer of chassis and body production specifically designed for school bus applications in the United States of America ("U.S."), Blue Bird is recognized as an industry leader for school bus innovation, safety, product quality/reliability/durability, efficiency, and lower operating costs. In addition, Blue Bird is the market leader in alternative powered product offerings with its propane-powered, gasoline-powered and all-electric-powered school buses.

Blue Bird sells its buses and parts through an extensive network of U.S. and Canadian dealers that, in their territories, are exclusive to Blue Bird on Type C and Type D school buses. Blue Bird also sells directly to major fleet operators, the U.S. Government, state governments, and authorized dealers in certain limited foreign countries.

Throughout this Report, we refer to the fiscal year ending September 28, 2024 as "fiscal 2024," the fiscal year ended September 30, 2023 as "fiscal 2023," the fiscal year ended October 1, 2022 as "fiscal 2022," the fiscal year ended October 2, 2021 as “fiscal 2021” and the fiscal year ended October 3, 2020 as "fiscal 2020." There will be or were 52 weeks in fiscal 2024, fiscal 2023 and fiscal 2022. The second quarters of fiscal 2024 and fiscal 2023 both included 13 weeks. The six month periods in fiscal 2024 and 2023 both included 26 weeks.

Impacts of COVID-19 and Subsequent Supply Chain Constraints on Our Business

As discussed in detail in the fiscal 2023 Form 10-K filed with the SEC on December 11, 2023, the novel coronavirus known as "COVID-19" materially affected demand for new buses and replacement/maintenance parts during the second half of fiscal 2020 and first half of fiscal 2021, significantly impacting our business and operations. Although demand for school buses strengthened

substantially during the second half of fiscal 2021, the Company, and automotive industry as a whole, began experiencing significant supply chain constraints around this same period of time. Additionally, the already challenged global supply chain for automotive parts that began in fiscal 2021 was further impacted, including continuing escalating inventory purchase costs, by additional stress resulting from Russia’s invasion of Ukraine in February 2022 (see further discussion below). These supply chain disruptions had a significant adverse impact on our operations and results during the second half of fiscal 2021 and all of fiscal 2022 due to higher purchasing costs, including freight costs incurred to expedite receipt of critical components, increased manufacturing inefficiencies and our inability to complete the production of buses to fulfill sales orders.

Towards the end of fiscal 2022 and continuing into fiscal 2023, there were slight improvements in the supply chain's ability to deliver the parts and components necessary to support our production operations, resulting in increased (i) manufacturing efficiencies and (ii) production of buses to fulfill sales orders during fiscal 2023. However, the higher costs charged by suppliers to procure inventory that continued into fiscal 2023 had a significant adverse impact on our operations and results. Specifically, such cost increases outpaced the increases in sales prices that we charged for the buses that were sold during the first quarter of fiscal 2023, many of which were included in the backlog of fixed price sales orders originating in fiscal 2021 and the early months of fiscal 2022 that carried forward into fiscal 2023. During the remainder of fiscal 2023, the buses that were sold were generally included in the backlog of fixed price sales orders originating more recently (i.e., the latter months of fiscal 2022 and in fiscal 2023), with the cumulative increases in sales prices we charged for those buses generally outpacing the higher costs we paid to procure inventory, resulting in gross profit during the quarters. While the gross margin on bus sales during the second quarter of fiscal 2023 lagged the historical gross margin reported prior to the COVID-19 pandemic, it returned to more normal historical levels during the latter half of fiscal 2023.

New bus orders during fiscal 2023 and continuing into fiscal 2024 remained robust, primarily due to a combination of (i) pent-up demand resulting from the cumulative effect of the COVID-19 pandemic when many school systems conducted virtual learning and (ii) the challenged global supply chain for automotive parts that hindered the school bus industry's ability to produce and sell buses that began during the latter half of fiscal 2021 and continued through the second quarter of fiscal 2024. Accordingly, the Company's backlog remained strong at approximately 4,600 units and 5,900 units as of September 30, 2023 and March 30, 2024 despite it selling over 8,500 units during fiscal 2023, the majority of which were included in the backlog that existed as of October 1, 2022, and almost 4,400 units in the first half of fiscal 2024.

In general, management believes that supply chain disruptions could continue in future periods and could materially impact our results if we are unable to i) obtain parts and supplies in sufficient quantities to meet our production needs and/or ii) pass along rising costs to our customers. They have resulted, and could continue to result, in significant economic disruption and have adversely affected our business. They could adversely impact our business for the remainder of fiscal 2024 and perhaps beyond. Significant uncertainty exists concerning the magnitude of the impact and duration of ongoing supply chain constraints and their potential impact on the overall economy, both within the U.S and globally. Accordingly, the magnitude and duration of any production and supply chain disruptions and their related financial impacts on our business cannot be estimated at this time.

The impacts from supply chain constraints on the Company's business and operations beginning during the second half of fiscal 2021 and continuing into fiscal 2024 negatively affected our inventory procurement costs, gross profit, income and cash flows. We continue to monitor and assess the ability of suppliers to maintain operations and to provide parts and supplies in sufficient quantities to meet our production needs and our ability to maintain continuous production during the remainder of fiscal 2024 and beyond. See PART I, Item 1.A. "Risk Factors," of our fiscal 2023 Form 10-K, filed with the SEC on December 11, 2023, for a discussion of the material risks we believe we face particularly related to supply chain disruptions and related constraints.

Impact of Russia’s Invasion of Ukraine on Our Business

On February 24, 2022, Russian military forces launched a large-scale invasion of Ukraine. While the Company has no assets or customers in either of these countries, this military conflict has had a significant negative impact on the Company’s operations, cash flows and results beginning in fiscal 2022 and continuing into fiscal 2024, primarily in an indirect manner since the Company does not sell to customers located in, or source goods directly from, either country.

Specifically, Ukraine has historically been a large exporter of ferroalloy materials used in the manufacture of steel and the disruption in the supply of these minerals has resulted in significant volatility in the price of steel. While the Company has generally mitigated its direct exposure to steel prices by executing fixed price purchase contracts (generally purchased up to four quarters in advance) for the majority of the significant amount of steel used in the manufacture of school bus bodies, many suppliers from which the Company purchases components containing steel increased the price that they charge the Company to acquire such inventory, primarily on a lagged basis, starting from the latter half of fiscal 2022 and continuing into fiscal 2024, as applicable. These inventory costs impact gross profit when school buses are sold and cash flows when the related invoices are paid.

Additionally, Russia has historically been a large global exporter of oil and many countries have ceased buying Russian oil in protest of the invasion and to comply with sanctions imposed by the U.S. and many European countries. Accordingly, the disruption in the supply of oil has significantly impacted the price of goods refined from oil, such as diesel fuel, the price of which has been volatile and has remained high since the latter half of fiscal 2022. These higher costs significantly impacted the Company both as a result of the price that suppliers charge the Company to acquire inventory (since diesel fuel impacts their cost of acquiring the inventory used in producing their goods) and the price that the Company pays for freight to deliver the inventory that it acquires. Additionally, such increases are generally implemented with very little lag so that they impact the purchase cost of inventory and cash flows on an almost real-time basis.

Finally, both countries have large quantities of other minerals that impact commodity costs, such as rubber and resin, among others, and the disruption caused by the ongoing military conflict increased the cost and/or decreased the supply of components containing these materials, further impacting an already challenged global supply chain for automotive parts.

Russia’s invasion of Ukraine has resulted, and is likely to continue to result, in significant economic disruption and has adversely affected our business. Specifically, it has contributed to higher inventory purchase costs, including freight costs, that negatively impacted the gross profit recognized on sales beginning during the latter part of fiscal 2022 and continuing into fiscal 2024. Because peace negotiations do not appear to be productive and because Russia has continued to intensify its military operations in Ukraine, we currently believe that this matter will continue to adversely impact our business for the remainder of fiscal 2024 and perhaps beyond. Significant uncertainty exists concerning the magnitude of the impact and duration of the ongoing military conflict and its impact on the overall economy, both within the U.S. and globally. Accordingly, the duration of any production and supply chain disruptions, and related financial impacts, cannot be estimated at this time.

Critical Accounting Policies and Estimates, Recent Accounting Pronouncements

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Blue Bird evaluates its estimates on an ongoing basis, based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Application of these accounting policies involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates.

The Company’s accounting policies that we believe are the most critical to aid in fully understanding and evaluating our reported financial results are described in the Company’s fiscal 2023 Form 10-K, filed with the SEC on December 11, 2023, under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates,” which description is incorporated herein by reference. Our senior management has reviewed these critical accounting policies and related disclosures and determined that there were no significant changes in our critical accounting policies during the six months ended March 30, 2024.

Recent Accounting Pronouncements

See Note 2 of Notes to Condensed Consolidated Financial Statements (Unaudited) included in Part I, Item 1 of this Report for a discussion of new and/or recently adopted accounting pronouncements, as applicable.

Factors Affecting Our Revenues

Our revenues are driven primarily by the following factors:

•Property tax revenues. Property tax revenues are one of the major sources of funding for school districts, and therefore new school buses. Property tax revenues are a function of land and building prices, relying on assessments of property value by state or county assessors and millage rates voted by the local electorate.

•Student enrollment and delivery mechanisms for learning. Increases or decreases in the number of school bus riders have a direct impact on school district demand. Evolving protocols for public health concerns and/or continued technological advancements could shift the future form of educational delivery away from in-person learning on a more permanent basis, with increased remote learning reasonably expected to decrease the number of school bus riders.

•Revenue mix. We are able to charge more for certain of our products (e.g., Type C propane-powered school buses, electric-powered buses, Type D buses, and buses with higher option content) than other products. The mix of products sold in any fiscal period can directly impact our revenues for the period.

•Strength of the dealer network. We rely on our dealers, as well as a small number of major fleet operators, to be the direct point of contact with school districts and their purchasing agents. An effective dealer is capable of expanding revenues within a given school district by matching that district’s needs to our capabilities, offering options that would not otherwise be provided to the district.

•Pricing. Our products are sold to school districts throughout the U.S. and Canada. Each state and each Canadian province has its own set of regulations that governs the purchase of products, including school buses, by their school districts. We and our dealers must navigate these regulations, purchasing procedures, and the districts’ specifications in order to reach mutually acceptable price terms. Pricing may or may not be favorable to us, depending upon a number of factors impacting purchasing decisions. Additionally, in certain cases, prices originally quoted with dealers and school districts may have become less favorable, or more unfavorable, to us given increasing inventory costs between the time the sales order was contractually agreed upon and the bus is built and delivered as a result of ongoing supply chain disruptions and general inflationary pressures.

•Buying patterns of major fleets. Major fleets regularly compete against one another for existing accounts. Fleets are also continuously trying to win the business of school districts that operate their own transportation services. These activities can have either a positive or negative impact on our sales, depending on the brand preference of the fleet that wins the business. Major fleets also periodically review their fleet sizes and replacement patterns due to funding availability as well as the profitability of existing routes. These actions can impact total purchases by fleets in a given year.

•Seasonality. Historically, our sales have been subject to seasonal variation based on the school calendar with the peak season during our third and fourth fiscal quarters. Sales during the third and fourth fiscal quarters are typically greater than the first and second fiscal quarters due to the desire of municipalities to have any new buses that they order available to them at the beginning of the new school year. With the COVID-19 pandemic impacting the demand for Company products and the impact of the subsequent supply chain constraints hindering the Company's ability to produce and sell buses, seasonality has become unpredictable. Seasonality and variations from historical seasonality have impacted the comparison of results between fiscal periods.

•Inflation. As discussed previously above, supply chain disruptions developing subsequent to the COVID-19 pandemic and Russia's invasion of Ukraine have significantly increased our inventory purchase costs, including freight costs incurred to expedite receipt of critical components, reflected in cost of goods sold during the latter half of fiscal 2021, all of fiscal 2022 and continuing, to a lesser extent, into fiscal 2023 and fiscal 2024. In response, beginning in July 2021, the Company has announced several sales price increases that apply to new sales orders and partially applied to backlog orders that were both intended to mitigate the impact of rising purchase costs on our operations and results. Most of these price increases only began to marginally impact sales and gross profit in the latter half of fiscal 2022. Specifically, they did not offset the significant continued increase in the Company's production costs, resulting in further deterioration of the Company's gross profit during the second half of fiscal 2022 and continuing into the first quarter of fiscal 2023 as it produced and sold the oldest units included in the backlog as of the end of fiscal 2022. However, they began to have a more significant, positive impact on sales and gross profit during the remainder of fiscal 2023, as the Company fulfilled sales orders (i) from the backlog existing as of the end of fiscal 2022 that originated more recently (i.e., during the latter months of fiscal 2022) and (ii) that were taken during fiscal 2023, both of which contained most or all of the cumulative sales prices increases that have been announced. These cumulative price increases also continued to have a significant, positive impact on sales and gross profit during the first half of fiscal 2024.

Factors Affecting Our Expenses and Other Items

Our expenses and other line items on our unaudited Condensed Consolidated Statements of Operations are principally driven by the following factors:

•Cost of goods sold. The components of our cost of goods sold consist of material costs (principally powertrain components, steel and rubber, as well as aluminum and copper) including freight costs, labor expense, and overhead. Our cost of goods sold may vary from period to period due to changes in sales volume, efforts by certain suppliers to pass through the economics associated with key commodities, fluctuations in freight costs, design changes with respect to specific components, design changes with respect to specific bus models, wage increases for plant labor, productivity of plant labor, delays in receiving materials and other logistical problems, and the impact of overhead items such as utilities.

•Selling, general and administrative expenses. Our selling, general and administrative expenses include costs associated with our selling and marketing efforts, engineering, centralized finance, human resources, purchasing, information technology services, along with other administrative matters and functions. In most instances, other than direct costs associated with sales and marketing programs, the principal component of these costs is salary expense. Changes from period to period are typically driven by the number of our employees, as well as by merit increases provided to experienced personnel.

•Interest expense. Our interest expense relates to costs associated with our debt instruments and reflects both the amount of indebtedness and the interest rate that we are required to pay on our debt. Interest expense also includes unrealized gains or losses from interest rate hedges, if any, and changes in the fair value of interest rate derivatives not designated in hedge accounting relationships, if any, as well as expenses related to debt guarantees, if any.

•Income taxes. We make estimates of the amounts to recognize for income taxes in each tax jurisdiction in which we operate. In addition, provisions are established for withholding taxes related to the transfer of cash between jurisdictions and for uncertain tax positions taken.

•Other expense/income, net. This balance includes periodic pension expense or income as well as gains or losses on foreign currency, if any. Other amounts not associated with operating expenses may also be included in this balance.

•Equity in net income or loss of non-consolidated affiliate. We include in this line item our 50% share of net income or loss from our investment in Micro Bird Holdings, Inc., our unconsolidated Canadian joint venture.

Key Non-GAAP Financial Measures We Use to Evaluate Our Performance

The condensed consolidated financial statements included in this Report in Item 1. "Financial Statements (Unaudited)" are prepared in conformity with U.S. GAAP. This Report also includes the following financial measures that are not prepared in accordance with U.S. GAAP ("non-GAAP"): “Adjusted EBITDA;” “Adjusted EBITDA Margin;” and “Free Cash Flow.” Adjusted EBITDA and Free Cash Flow are financial metrics that are utilized by management and the board of directors to determine (a) the annual cash bonus payouts, if any, to be made to certain employees based upon the terms of the Company’s Management Incentive Plan, and (b) whether the performance criteria have been met for the vesting of certain equity awards granted annually to certain members of management based upon the terms of the Company’s Omnibus Equity Incentive Plan. Additionally, consolidated EBITDA, which is an adjusted EBITDA metric defined by our Credit Agreement (defined below) that could differ from Adjusted EBITDA discussed above as the adjustments to the calculations are not uniform, is used to determine the Company's ongoing compliance with several financial covenant requirements, including being utilized in the denominator of the calculation of the Total Net Leverage Ratio ("TNLR"), which is also utilized in determining the interest rate we pay on borrowings under our Credit Agreement (defined below). Accordingly, management views these non-GAAP financial metrics as key for the above purposes and as a useful way to evaluate the performance of our operations as discussed further below.

Adjusted EBITDA is defined as net income or loss prior to interest income; interest expense including the component of operating lease expense (which is presented as a single operating expense in selling, general and administrative expenses in our U.S. GAAP financial statements) that represents interest expense on lease liabilities; income taxes; and depreciation and amortization including the component of operating lease expense (which is presented as a single operating expense in selling, general and administrative expenses in our U.S. GAAP financial statements) that represents amortization charges on right-of-use lease assets; as adjusted for certain non-cash charges or credits that we may record on a recurring basis such as share-based compensation expense and unrealized gains or losses on certain derivative financial instruments; net gains or losses on the disposal of assets as well as certain charges such as (i) significant product design changes; (ii) transaction related costs; or (iii) discrete expenses related to major cost cutting and/or operational transformation initiatives. While certain of the charges that are added back in the Adjusted EBITDA calculation, such as transaction related costs and operational transformation and major product redesign initiatives, represent operating expenses that may be recorded in more than one annual period, the significant project or transaction giving rise to such expenses is not considered to be indicative of the Company’s normal operations. Accordingly, we believe that these, as well as the other credits and charges that

comprise the amounts utilized in the determination of Adjusted EBITDA described above, should not be used in evaluating the Company’s ongoing annual operating performance.

We define Adjusted EBITDA Margin as Adjusted EBITDA as a percentage of net sales. Adjusted EBITDA and Adjusted EBITDA Margin are not measures of performance defined in accordance with U.S. GAAP. The measures are used as a supplement to U.S. GAAP results in evaluating certain aspects of our business, as described below.

We believe that Adjusted EBITDA and Adjusted EBITDA Margin are useful to investors in evaluating our performance because the measures consider the performance of our ongoing operations, excluding decisions made with respect to capital investment, financing, and certain other significant initiatives or transactions as outlined in the preceding paragraphs. We believe the non-GAAP measures offer additional financial metrics that, when coupled with the U.S. GAAP results and the reconciliation to U.S. GAAP results, provide a more complete understanding of our results of operations and the factors and trends affecting our business.

Adjusted EBITDA and Adjusted EBITDA Margin should not be considered as alternatives to net income or loss as an indicator of our performance or as alternatives to any other measure prescribed by U.S. GAAP as there are limitations to using such non-GAAP measures. Although we believe that Adjusted EBITDA and Adjusted EBITDA Margin may enhance an evaluation of our operating performance based on recent revenue generation and product/overhead cost control because they exclude the impact of prior decisions made about capital investment, financing, and certain other significant initiatives or transactions, (i) other companies in Blue Bird’s industry may define Adjusted EBITDA and Adjusted EBITDA Margin differently than we do and, as a result, they may not be comparable to similarly titled measures used by other companies in Blue Bird’s industry, and (ii) Adjusted EBITDA and Adjusted EBITDA Margin exclude certain financial information that some may consider important in evaluating our performance.

We compensate for these limitations by providing disclosure of the differences between Adjusted EBITDA and U.S. GAAP results, including providing a reconciliation to U.S. GAAP results, to enable investors to perform their own analysis of our ongoing operating results.

Our measure of Free Cash Flow is used in addition to and in conjunction with results presented in accordance with U.S. GAAP and it should not be relied upon to the exclusion of U.S. GAAP financial measures. Free Cash Flow reflects an additional way of evaluating our liquidity that, when viewed with our U.S. GAAP results, provides a more complete understanding of factors and trends affecting our cash flows. We strongly encourage investors to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

We define Free Cash Flow as total cash provided by/used in operating activities as adjusted for cash paid for the acquisition of fixed assets and intangible assets. We use Free Cash Flow, and ratios based on Free Cash Flow, to conduct and evaluate our business because, although it is similar to cash flow from operations, we believe it is a more conservative measure of cash flow since purchases of fixed assets and intangible assets are a necessary component of ongoing manufacturing operations. Accordingly, Free Cash Flow will be less than operating cash flows.

Our Segments

We manage our business in two operating segments, which are also our reportable segments: (i) the Bus segment, which involves the design, engineering, manufacture and sales of school buses and extended warranties; and (ii) the Parts segment, which includes the sale of replacement bus parts. Financial information is reported on the basis that it is used internally by the chief operating decision maker (“CODM”) in evaluating segment performance and deciding how to allocate resources to segments. The Chief Executive Officer of the Company has been identified as the CODM. Management evaluates the segments based primarily upon revenues and gross profit.

Consolidated Results of Operations for the Three Months Ended March 30, 2024 and April 1, 2023:


	Three Months Ended
(in thousands of dollars)	March 30, 2024			April 1, 2023
Net sales	$	345,915		$	299,814
Cost of goods sold	282,276			264,165
Gross profit	$	63,639		$	35,649
Operating expenses
Selling, general and administrative expenses	27,571			23,205
Operating profit	$	36,068		$	12,444
Interest expense	(2,812)			(5,192)
Interest income	1,054			12
Other expense, net	(1,968)			(342)

Income before income taxes	$	32,342		$	6,922
Income tax expense	(8,261)			(1,389)
Equity in net income of non-consolidated affiliate	1,942			1,597


Net income	$	26,023		$	7,130
Other financial data:
Adjusted EBITDA	$	45,751		$	21,088
Adjusted EBITDA margin	13.2		%	7.0		%

The following provides the results of operations of Blue Bird’s two reportable segments:


(in thousands of dollars)	Three Months Ended
Net Sales by Segment	March 30, 2024		April 1, 2023
Bus	$	317,959	$	273,472
Parts	27,956		26,342
Total	$	345,915	$	299,814

Gross Profit (Loss) by Segment
Bus	$	49,589	$	23,099
Parts	14,050		12,550
Total	$	63,639	$	35,649

Net sales. Net sales were $345.9 million for the second quarter of fiscal 2024, an increase of $46.1 million, or 15.4%, compared to $299.8 million for the second quarter of fiscal 2023. The increase in net sales is primarily due to product and mix changes, as well as pricing actions taken by management in response to increased inventory purchase costs, all of which were partially offset by a small decrease in unit bookings.

Bus sales increased $44.5 million, or 16.3%, reflecting an 18.8% increase in average sales price per unit that was partially offset by a 2.2% decrease in units booked. In the second quarter of fiscal 2024, 2,254 units were booked compared to 2,304 units booked for the same period in fiscal 2023. The small decrease in units sold was primarily due to product mix changes as well as a slight increase in supply chain constraints impacting the Company's ability to produce and deliver buses due to shortages of critical components during the second quarter of 2024 relative to the second quarter of fiscal 2023. The increase in unit price for the second quarter of fiscal 2024 compared to the same period in fiscal 2023 reflects pricing actions taken by management as well as product and customer mix changes.

Parts sales increased $1.6 million, or 6.1%, for the second quarter of fiscal 2024 compared to the second quarter of fiscal 2023. This increase is primarily attributed to price increases, driven by ongoing inflationary pressures, as well as higher fulfillment volumes and slight variations due to product and channel mix.

Cost of goods sold. Total cost of goods sold was $282.3 million for the second quarter of fiscal 2024, an increase of $18.1 million, or 6.9%, compared to $264.2 million for the second quarter of fiscal 2023. As a percentage of net sales, total cost of goods sold improved from 88.1% to 81.6%, primarily due to the pricing actions discussed above taking effect.

Bus segment cost of goods sold increased $18.0 million, or 7.2%, for the second quarter of fiscal 2024 compared to the same period in fiscal 2023. The increase was primarily driven by increased inventory costs, as the average cost of goods sold per unit for the second quarter of fiscal 2024 was 9.6% higher compared to the second quarter of fiscal 2023, primarily due to increases in manufacturing costs attributable to a) increased raw materials costs resulting from ongoing inflationary pressures and b) ongoing supply chain disruptions that resulted in higher purchase costs for components. The increase in inventory costs was partially offset by a 2.2% decrease in units booked in the second quarter of fiscal 2024 compared to the same period in fiscal 2023.

The $0.1 million, or 0.8%, increase in parts segment cost of goods sold for the second quarter of fiscal 2024 compared to the second quarter of fiscal 2023 was primarily due to increased purchased parts costs, driven by ongoing inflationary pressures and supply chain disruptions, as well as slight variations due to product and channel mix.

Operating profit. Operating profit was $36.1 million for the second quarter of fiscal 2024, an increase of $23.6 million, compared to operating profit of $12.4 million for the second quarter of fiscal 2023. Profitability was primarily impacted by an increase of $28.0 million in gross profit as outlined in the revenue and cost of goods sold discussions above. The increase in gross profit was partially offset by an increase of $4.4 million in selling, general and administrative expenses, primarily due to an increase in labor costs.

Interest expense. Interest expense was $2.8 million for the second quarter of fiscal 2024, a decrease of $2.4 million, or 45.8%, compared to $5.2 million for the second quarter of fiscal 2023. The decrease was primarily attributable to a decrease in the stated term loan interest rate from 10.5% at April 1, 2023 to 7.2% at March 30, 2024, as well as lower outstanding borrowings in the second quarter of fiscal 2024 compared to the second quarter of fiscal 2023.

Other expense, net. Other expense, net, was $2.0 million for the second quarter of fiscal 2024, an increase of $1.6 million, or 475.4%, compared to $0.3 million of other expense, net, for the same period in fiscal 2023.

On February 15, 2024, the Company entered into an underwriting agreement with Barclays Capital Inc., as representative of the several underwriters and American Securities LLC ("Selling Stockholder"), pursuant to which the Selling Shareholder agreed to sell 4,042,650 shares of common stock at a purchase price of $32.90 per share ("February Offering").

The February Offering was conducted pursuant to a prospectus supplement, dated February 15, 2024, to the prospectus, dated December 22, 2021, included in the Company’s registration statement on Form S-3 (File No. 333-261858) that was initially filed with the SEC on December 23, 2021.

The February Offering closed on February 21, 2024. Although the Company did not sell any shares or receive any proceeds from the February Offering, it was required to pay certain expenses in connection with the February Offering that totaled approximately $1.9 million for the three month period ended March 30, 2024, with $0.7 million of similar expense recorded during the three month period ended April 1, 2023. However, the $0.7 million of expense was included within selling, general and administrative expenses for the three month period ended April 1, 2023, but was subsequently reclassified to other expense, net, during the third quarter of fiscal 2023.

Income taxes. Income tax expense was $8.3 million for the second quarter of fiscal 2024 compared to $1.4 million for the same period in fiscal 2023.

The effective tax rate for the three months ended April 1, 2023 was 20.1%, which aligned with the statutory federal income tax rate of 21% and was comprised of normal tax rate items, including impacts from state taxes and federal and state tax credits (net of valuation allowances), with discrete period items having a nominal impact on the effective rate during the quarter.

Adjusted EBITDA. Adjusted EBITDA was $45.8 million, or 13.2% of net sales, for the second quarter of fiscal 2024, an increase of $24.7 million, or 117.0%, compared to $21.1 million, or 7.0% of net sales, for the second quarter of fiscal 2023. The increase is primarily the result of the $18.9 million increase in net income as a result of the factors discussed above as well as the $6.9 million corresponding increase in income tax expense.

The following table sets forth a reconciliation of net income to Adjusted EBITDA for the periods presented:


	Three Months Ended
(in thousands of dollars)	March 30, 2024			April 1, 2023
Net income	$	26,023		$	7,130
Adjustments:
Interest expense, net (1)	1,860			5,281
Income tax expense	8,261			1,389
Depreciation, amortization, and disposals (2)	3,988			4,181
Operational transformation initiatives	—			137
Share-based compensation expense	2,492			699


Stockholder transaction costs	1,933			743

Other	(1)			281
Subtotal (Adjusted EBITDA as previously presented)	$	44,556		$	19,841
Micro Bird Holdings, Inc. total interest expense, net; income tax expense or benefit; depreciation expense and amortization expense	1,195			1,247
Adjusted EBITDA	$	45,751		$	21,088
Adjusted EBITDA margin (percentage of net sales)	13.2		%	7.0		%

(1) Includes $0.1 million for both fiscal periods, representing interest expense on operating lease liabilities, which are a component of lease expense and presented as a single operating expense in selling, general and administrative expenses on our Condensed Consolidated Statements of Operations.

(2) Includes $0.3 million and $0.4 million for the three months ended March 30, 2024 and April 1, 2023, respectively, representing amortization charges on right-of-use lease assets, which are a component of lease expense and presented as a single operating expense in selling, general and administrative expenses on our Condensed Consolidated Statements of Operations.

Consolidated Results of Operations for the Six Months Ended March 30, 2024 and April 1, 2023:


	Six Months Ended
(in thousands of dollars)	March 30, 2024			April 1, 2023
Net sales	$	663,575		$	535,546
Cost of goods sold	536,378			492,440
Gross profit	$	127,197		$	43,106
Operating expenses
Selling, general and administrative expenses	53,173			40,037
Operating profit	$	74,024		$	3,069
Interest expense	(6,443)			(9,388)
Interest income	2,142			12
Other expense, net	(3,189)			(578)
Loss on debt modification	(1,558)			(537)
Income (loss) before income taxes	$	64,976		$	(7,422)
Income tax (expense) benefit	(16,707)			1,592
Equity in net income of non-consolidated affiliate	3,904			1,666


Net income (loss)	$	52,173		$	(4,164)
Other financial data:
Adjusted EBITDA	$	93,355		$	17,552
Adjusted EBITDA margin	14.1		%	3.3		%

The following provides the results of operations of Blue Bird’s two reportable segments:


(in thousands of dollars)	Six Months Ended
Net Sales by Segment	March 30, 2024		April 1, 2023
Bus	$	611,396	$	486,721
Parts	52,179		48,825
Total	$	663,575	$	535,546

Gross Profit by Segment
Bus	$	100,883	$	19,368
Parts	26,314		23,738
Total	$	127,197	$	43,106

Net sales. Net sales were $663.6 million for the six months ended March 30, 2024, an increase of $128.0 million, or 23.9%, compared to $535.5 million for the six months ended April 1, 2023. The increase in net sales is primarily due to increased unit bookings, product and mix changes, as well as pricing actions taken by management in response to increased inventory purchase costs.

Bus sales increased $124.7 million, or 25.6%, reflecting a 2.9% increase in units booked and a 22.1% increase in average sales price per unit. 4,383 units booked in the six months ended March 30, 2024 compared with 4,261 units booked during the same period in fiscal 2023. The increase in units sold was primarily due to slight improvements in supply chain constraints impacting the Company's ability to produce and deliver buses due to shortages of critical components during the first half of fiscal 2024 relative to the same period in fiscal 2023. The increase in unit price for the first half of fiscal 2024 compared to the same period in fiscal 2023 reflects pricing actions taken by management as well as product and customer mix changes.

Parts sales increased $3.4 million, or 6.9%, for the six months ended March 30, 2024 compared to the six months ended April 1, 2023. This increase is primarily attributed to price increases, driven by ongoing inflationary pressures, as well as higher fulfillment volumes and slight variations due to product and channel mix.

Cost of goods sold. Total cost of goods sold was $536.4 million for the six months ended March 30, 2024, an increase of $43.9 million, or 8.9%, compared to $492.4 million for the six months ended April 1, 2023. As a percentage of net sales, total cost of goods sold improved from 92.0% to 80.8%.

Bus segment cost of goods sold increased $43.2 million, or 9.2%, for the six months ended March 30, 2024 compared to the six months ended April 1, 2023. The increase was partially attributable to the 2.9% increase in units booked in the six months ended March 30, 2024 compared to the same period in fiscal 2023. Also contributing was increased inventory costs, as the average cost of goods sold per unit for the six months ended March 30, 2024 was 6.2% higher compared to the six months ended April 1, 2023, primarily due to increases in manufacturing costs attributable to a) increased raw materials costs resulting from ongoing inflationary pressures and b) ongoing supply chain disruptions that resulted in higher purchase costs for components.

The $0.8 million, or 3.1%, increase in parts segment cost of goods sold for the six months ended March 30, 2024 compared to the six months ended April 1, 2023 was primarily due to increased purchased parts costs, driven by ongoing inflationary pressures and supply chain disruptions, as well as slight variations due to product and channel mix.

Operating profit. Operating profit was $74.0 million for the six months ended March 30, 2024, an increase of $71.0 million compared to operating profit of $3.1 million for the six months ended April 1, 2023. Profitability was primarily impacted by an increase of $84.1 million in gross profit as outlined in the revenue and cost of goods sold discussions. The increase in gross profit was partially offset by an increase of $13.1 million in selling, general and administrative expenses, primarily due to an increase in labor costs. Additionally, selling, general and administrative expenses during the first quarter of fiscal 2023 benefited from actions taken by management to reduce labor costs and certain discretionary spending to mitigate the significant adverse impact of ongoing supply chain constraints on the Company's operations and results.

Interest expense. Interest expense was $6.4 million for the six months ended March 30, 2024, a decrease of $2.9 million, or 31.4%, compared to $9.4 million for the six months ended April 1, 2023. The decrease was primarily attributable to a decrease in the stated term loan interest rate from 10.5% at April 1, 2023 to 7.2% at March 30, 2024, as well as lower outstanding borrowings in the first half of fiscal 2024 compared to the first half of fiscal 2023.

Other expense, net. Other expense, net, was $3.2 million for the six months ended March 30, 2024, an increase of $2.6 million, or 451.7%, compared to $0.6 million for the six months ended April 1, 2023. We recorded $0.1 million of net periodic pension expense during the six months ended March 30, 2024 when compared with $0.4 million recorded during the six months ended April 1, 2023.

Additionally, on December 14, 2023, the Company entered into an underwriting agreement with BofA Securities, Inc. and Barclays Capital Inc., as representatives of the several underwriters and the Selling Stockholder, pursuant to which the Selling Stockholder agreed to sell 2,500,000 shares of common stock at a purchase price of $25.10 per share (“December Offering” and collectively with the February Offering, “Offerings”).

The December Offering was conducted pursuant to a prospectus supplement, dated December 14, 2023, to the prospectus dated December 22, 2021 included in the Company’s registration statement on Form S-3 (File No. 333-261858) that was initially filed with the SEC on December 23, 2021. The December Offering closed on December 19, 2023.

Although the Company did not sell any shares or receive any proceeds from the Offerings, it was required to pay certain expenses in connection with the Offerings that totaled approximately $3.2 million for the six month period ended March 30, 2024, with $0.7 million of similar expense recorded during the six month period ended April 1, 2023. However, the $0.7 million of expense was included within selling, general and administrative expenses for the six month period ended April 1, 2023, but was subsequently reclassified to other expense, net, during the third quarter of fiscal 2023.

Income taxes. Income tax expense was $16.7 million for the six months ended March 30, 2024 compared to income tax benefit of $1.6 million for the six months ended April 1, 2023.

Adjusted EBITDA. Adjusted EBITDA was $93.4 million, or 14.1% of net sales, for the six months ended March 30, 2024, an increase of $75.8 million, or 431.9%, compared to $17.6 million, or 3.3% of net sales, for the six months ended April 1, 2023. The increase in Adjusted EBITDA is primarily the result of the $56.3 million increase in net income as a result of the factors discussed above as well as the $18.3 million corresponding increase in income tax expense.

The following table sets forth a reconciliation of net income (loss) to Adjusted EBITDA for the periods presented:


	Six Months Ended
(in thousands of dollars)	March 30, 2024			April 1, 2023
Net income (loss)	$	52,173		$	(4,164)
Adjustments:
Interest expense, net (1)	4,515			9,570
Income tax expense (benefit)	16,707			(1,592)
Depreciation, amortization, and disposals (2)	8,198			7,996
Operational transformation initiatives	—			937
Loss on debt refinancing or modification	1,558			537
Share-based compensation expense	4,543			1,288


Stockholder transaction costs	3,154			743
Other	(83)			281
Subtotal (Adjusted EBITDA as previously presented)	$	90,765		$	15,596
Micro Bird Holdings, Inc. total interest expense, net; income tax expense or benefit; depreciation expense and amortization expense	2,590			1,956
Adjusted EBITDA	$	93,355		$	17,552
Adjusted EBITDA margin (percentage of net sales)	14.1		%	3.3		%

(1) Includes $0.2 million for both six month periods, representing interest expense on operating lease liabilities, which are a component of lease expense and presented as a single operating expense in selling, general and administrative expenses on our Condensed Consolidated Statements of Operations.

(2) Includes $0.9 million for both six month periods, representing amortization charges on right-of-use lease assets, which are a component of lease expense and presented as a single operating expense in selling, general and administrative expenses on our Condensed Consolidated Statements of Operations.

Liquidity and Capital Resources

The Company’s primary sources of liquidity are cash generated from its operations, available cash and cash equivalents and borrowings under its revolving credit facility. At March 30, 2024, the Company had $93.1 million of available cash (net of outstanding checks) and $143.3 million of additional borrowings available under the revolving line of credit portion of its credit facility. The Company’s revolving line of credit is available for working capital requirements, capital expenditures and other general corporate purposes.

Credit Agreement

On November 17, 2023 (the “Closing Date”), Blue Bird Body Company ("Borrower") executed a $250.0 million five-year credit agreement with Bank of Montreal, acting as administrative agent and an issuing bank; several joint lead arranger partners and issuing banks, including Bank of America; and a syndicate of other lenders (the "Credit Agreement").

Borrower has the right to prepay the loans outstanding under the Credit Facilities without premium or penalty (subject to customary breakage costs, if applicable). Additionally, proceeds from asset sales, condemnation, casualty insurance and/or debt issuances (in certain circumstances) are required to be used to prepay borrowings outstanding under the Credit Facilities. Borrowings under the Term Loan Facility, which were made at the Closing Date, may not be reborrowed once they are repaid while borrowings under the Revolving Credit Facility may be repaid and reborrowed from time to time at our election.

The Term Loan Facility is subject to amortization of principal, payable in equal quarterly installments on the last day of each fiscal quarter, which commenced on March 30, 2024, with 5.0% of the $100.0 million aggregate principal amount of all initial term loans outstanding at the Closing Date payable each year prior to the maturity date of the Term Loan Facility. The remaining initial aggregate principal amount outstanding under the Term Loan Facility, as well as any outstanding borrowings under the Revolving Credit Facility, will be payable on the November 17, 2028 maturity date of the Credit Agreement.

Borrowings under the Credit Facilities bear interest, at our option, at (i) base rate ("ABR") or (ii) the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York ("SOFR") plus 0.10%, plus an applicable margin depending on the TNLR (which is defined in the Credit Agreement as the ratio of consolidated net debt to consolidated EBITDA on a trailing four quarter basis) of the Company as follows:


Level	TNLR	ABR Loans	SOFR Loans
I	Less than 1.00x	0.75%	1.75%
II	Greater than or equal to 1.00x and less than 1.50x	1.50%	2.50%
III	Greater than or equal to 1.50x and less than 2.25x	2.00%	3.00%
IV	Greater than or equal to 2.25x	2.25%	3.25%

Pricing on the Closing Date was set at Level III until receipt of the financial information and related compliance certificate for the first fiscal quarter ending after the Closing Date, with pricing as of March 30, 2024 set at Level I.

Detailed descriptions of the Amended Credit Agreement are set forth under “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources” contained in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2023, filed with the SEC on December 11, 2023.

At March 30, 2024, Borrower and the guarantors under the Credit Agreement were in compliance with all covenants.

Short-Term and Long-Term Liquidity Requirements

Our ability to make principal and interest payments on borrowings under our Credit Facilityies and our ability to fund planned capital expenditures will depend on our ability to generate cash in the future, which, to a certain extent, is subject to general economic, financial, competitive, regulatory and other conditions. The adverse impacts from ongoing supply chain disruptions materially impacted our operations and results during the second half of fiscal 2021 and all of fiscal 2022 due to higher purchasing costs, including freight costs incurred to expedite receipt of critical components, increased manufacturing inefficiencies and our inability to complete the production of buses to fulfill sales orders.

Supply chain disruptions continued into the first half of fiscal 2024 as there were still occasional shortages of certain critical components as well as ongoing increases in raw materials costs, both of which impacted our business and operations by limiting the number of school buses that we could produce and sell as well as increasing the costs to manufacture buses. Nonetheless, ongoing improvements in manufacturing operations, when coupled with periodic pricing actions taken by the Company to ensure that the increased sales prices charged for buses kept pace with increased costs to procure inventory to produce the buses, allowed the Company to report gross profit and gross margin during the first half of fiscal 2024 that were consistent with, or better than, historic levels experienced prior to the COVID-19 pandemic.

The development and fluidity of ongoing or future supply chain constraints preclude any prediction as to the ultimate severity of the adverse impacts on our business, financial condition, results of operations, and liquidity. See PART I, Item 1.A. "Risk Factors," of our fiscal 2023 Form 10-K, filed with the SEC on December 11, 2023, for a discussion of the material risks we believe we face particularly related to health epidemics and supply chain constraints.

Future health epidemics and/or continuing supply chain constraints could cause a contraction in our profits and/or liquidity, which could lead to issues complying with our Credit Agreement covenants. If we are not able to comply with covenants, we may need to seek amendment for covenant relief or even refinance the debt to a "covenant lite" or "no covenant" structure. We can offer no

assurance that we would be successful in amending or refinancing the existing debt. An amendment or refinancing of our existing debt could lead to higher interest rates and possible up-front expenses not included in our historical financial statements.

To increase our liquidity in future periods, we could pursue raising additional capital via an equity or debt offering utilizing a currently effective "shelf" registration statement. However, we can offer no assurance that we would be successful in raising this additional capital, which could also lead to increased expense and larger up-front fees when compared with our historical financial statements.

Seasonality

Historically, our business has been highly seasonal with school districts buying their new school buses so that they will be available for use on the first day of the school year, typically in mid-August to early September. This has, in fiscal years prior to the COVID-19 pandemic, resulted in our third and fourth fiscal quarters representing our two busiest quarters from a sales and production perspective, the latter ending on the Saturday closest to September 30. Our quarterly results of operations, cash flows, and liquidity have historically been, and are likely to be in future periods, impacted by seasonal patterns. Working capital has historically been a significant use of cash during the first fiscal quarter due to planned shutdowns and a significant source of cash generation in the fourth fiscal quarter. With the COVID-19 pandemic and subsequent supply chain constraints, seasonality and working capital trends have become unpredictable. Seasonality and variations from historical seasonality have impacted the comparison of working capital and liquidity results between fiscal periods.

Cash Flows

The following table sets forth general information derived from our Condensed Consolidated Statements of Cash Flows:


	Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023
Cash, cash equivalents and restricted cash at beginning of period	$	78,988	$	10,479
Total cash provided by operating activities	54,771		44,716
Total cash used in investing activities	(5,643)		(3,740)
Total cash used in financing activities	(35,020)		(33,444)
Change in cash, cash equivalents and restricted cash	$	14,108	$	7,532
Cash, cash equivalents and restricted cash at end of period	$	93,096	$	18,011

Total cash provided by operating activities

Cash flows provided by operating activities totaled $54.8 million for the six months ended March 30, 2024, an increase of $10.1 million from the $44.7 million of cash flows provided by operating activities during the six months ended April 1, 2023. The increase was primarily attributable to a $56.3 million increase in net income and a $3.0 million increase in the dividend received from our unconsolidated Canadian joint venture during the first half of fiscal 2024 when compared with the corresponding period in fiscal 2023.

However, these increases werre partially offset by the effect of net changes in operating assets and liabilities that negatively impacted operating cash flows by $54.1 million during the six months ended March 30, 2024 when compared with the six months ended April 1, 2023. The primary drivers in this category were unfavorable changes in inventory and accounts payable of $23.9 million and $25.8 million, respectively. At the end of fiscal 2022 and during the first half of fiscal 2023, inflationary pressures and supply chain disruptions significantly increased our purchase costs for components and freight, which, when coupled with increased production and sales volumes during the first half of fiscal 2023, resulted in a significant increase in the accounts payable balance (a net source of cash) when compared with a small increase in the accounts payable balance during the first half of fiscal 2024 (a net source of cash). Additionally, we became more efficient at managing supply chain disruptions, and thus building and selling buses, during the the first half of fiscal 2023. These efficiencies resulted in us consuming more inventory in production, which resulted in a significant decrease in the inventory balance at the end of the second quarter of fiscal 2023 (a net source of cash). In comparison, we had an increase in the inventory balance at the end of the second quarter of fiscal 2024 (a net use of cash) as we elected to strategically acquire larger quantities of certain components (i) that have longer lead times and could impact our production schedule if not manufactured by our suppliers and delivered to us in a timely manner and (ii) in anticipation of model year changeovers by some of our larger suppliers that are expected to decrease the availability of such inventory later in fiscal 2024.

Total cash used in investing activities

Cash flows used in investing activities totaled $5.6 million for the six months ended March 30, 2024 as compared to $3.7 million for the six months ended April 1, 2023. The $1.9 million increase was primarily due to an increase in spending on fixed assets, as increased profitability in the first half of fiscal 2024 when compared with the same period in fiscal 2023 allowed for more capital spending. During the first half of fiscal 2023, capital spending was reduced to lower than normal amounts in an effort to mitigate the impact of supply chain constraints on our operations, financial results and cash flows.

Total cash used in financing activities

Cash flows used in financing activities totaled $35.0 million for the six months ended March 30, 2024 as compared to $33.4 million for the six months ended April 1, 2023. The $1.6 million increase between fiscal periods was primarily attributable to a $123.2 million increase in term loan principal repayments, which was partially offset by $100.0 million of proceeds received from term loan borrowings under the Credit Agreement, a $20.0 million net increase in revolving line of credit borrowings and a $1.7 million increase in cash received from stock option exercises.

Free cash flow

Management believes the non-GAAP measurement of Free Cash Flow, defined as net cash provided by operating activities less cash paid for fixed assets and acquired intangible assets, fairly represents the Company’s ability to generate surplus cash that could fund activities not in the ordinary course of business. See “Key Non-GAAP Financial Measures We Use to Evaluate Our Performance” for further discussion. The following table sets forth the calculation of Free Cash Flow for the periods presented:


	Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023
Net cash provided by operating activities	$	54,771	$	44,716
Cash paid for fixed assets	(5,643)		(3,740)
Free Cash Flow	$	49,128	$	40,976

Free Cash Flow for the six months ended March 30, 2024 was $8.2 million higher than for the six months ended April 1, 2023 due to a $10.1 million increase in net cash provided by operating activities that was partially offset by a $1.9 million increase in cash paid for fixed assets, both as discussed above.

Off-Balance Sheet Arrangements

We had outstanding letters of credit totaling $6.7 million at March 30, 2024, the majority of which secure our self-insured workers compensation program, the collateral for which is regulated by the State of Georgia.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have not been any material changes to our interest rate, commodity or currency risks previously disclosed in Part II, Item 7A of the Company’s fiscal 2023 Form 10-K.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

The Company maintains a system of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) that are designed to provide reasonable assurance that information required to be disclosed in its reports filed or submitted under 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 management, including, as appropriate, the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures. 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.

Based on their evaluations, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of March 30, 2024.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the fiscal quarter ended March 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Items required under Part II not specifically shown below are not applicable.

Item 1. Legal Proceedings.

Blue Bird is engaged in legal proceedings in the ordinary course of its business. Although no assurances can be given about the final outcome of pending legal proceedings, at the present time management does not believe that the resolution or outcome of any of Blue Bird’s pending legal proceedings will have a material adverse effect on its financial condition, liquidity or results of operations.

Item 1A. Risk Factors.

In addition to the other information set forth in this Report, you should carefully consider the risk factors discussed in Part I, Item 1A of the Company's fiscal 2023 Form 10-K. Such risk factors are expressly incorporated herein by reference, and could materially adversely affect our business, financial condition, cash flows or operating results. The risks described in the fiscal 2023 Form 10-K are not the only risks facing the Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition, cash flows and/or operating results.

Item 5. Other Information.

(c) During the second quarter of fiscal 2024, none of the Company's directors or officers adopted or terminated any "Rule 10b5-1 trading arrangement" or any "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408 of Regulation S-K. However, Philip Horlock’s previously disclosed Rule 10b5-1 trading plan expired during the quarter in accordance with its terms as all shares covered under such plan have been sold.

Item 6. Exhibits.

The following Exhibits are filed with this Report:


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 with the SEC on February 26, 2015).

3.2						Bylaws of Blue Bird Corporation, as amended, effective February 2, 2023 (incorporated by reference to Exhibit 3.2 to the registrant's Current Report on Form 8-K, filed by the registrant with the SEC on February 3, 2023).

10.1*						Change in Control Plan , effective as of January 25, 2024.

10.2*						O mnibus Amendment to Outstanding Stock Option and Restricted Stock Unit Awards Under the Amended and Restated Blue Bird Corporation 2015 Omnibus Equity Incentive Plan, effective as of January 25, 2024.

10.3*						Employment Agreement effective May 15 , 2023, between Phil Horlock and Blue Bird Corporation .

10.4*						Employment Agreement effective July 1, 2023, between Britton Smith and Blue Bird Corporation .

10.5*						Employment Agreement effective October 1, 2023, between Razvan Radulescu and Blue Bird Corporation .

10.6*						Employment Agreement effective October 1, 2023, between Ted Scartz and Blue Bird Corporation .

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 and Chief Financial Officer Joint Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*^						XBRL Instance Document

101.SCH*^						XBRL Taxonomy Extension Schema Document

101.CAL*^						XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*^						XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*^						XBRL Taxonomy Extension Label Linkbase Document

101.PRE*^						XBRL Taxonomy Extension Presentation Linkbase Document

104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith.

^ In accordance with Regulation S-T, XBRL (Extensible Business Reporting Language) related information in Exhibit No. 101 to this Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, and shall not be incorporated by reference into any registration statement pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

SIGNATURES

Pursuant to the requirements 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


Dated:	May 8, 2024	/s/ Philip Horlock
		Philip Horlock
		Chief Executive Officer

Dated:	May 8, 2024	/s/ Razvan Radulescu
		Razvan Radulescu
		Chief Financial Officer

BLUE BIRD CORPORATION

CHANGE IN CONTROL PLAN

Blue Bird Corporation, a Delaware corporation (the “Company”), hereby establishes this Blue Bird Corporation Change in Control Plan (the “Plan”). The Plan is initially effective as of January 25, 2024 (the “Effective Date”).

Article 1. Purpose

The purpose of this Plan is to further the growth and success of the Company by enabling Participants to share in the gains upon a sale of the Company, thereby increasing their personal stake in the Company’s growth and success, providing a means of rewarding outstanding service by such Participants and aiding retention.

Article 2. Definitions.

In addition to the defined terms defined elsewhere in this Plan, the following terms have the meaning set forth herein:

(a)“Affiliate,” with respect to any entity, means any corporation or any other entity (including, but not limited to, partnerships and joint ventures) controlling, controlled by, or under common control with the entity, whether now or hereafter existing.

(b)“Award” means an award made to a Participant pursuant to this Plan.

(c)“Award Agreement” means the individual Award Agreement in the form of Appendix B or such other form as the Committee may specify with respect to any Award that informs the Participant of his or her designation as a participant in the Plan and any further terms thereof.

(d)“Beneficiary” means the beneficiary designated by a Participant in writing to the Committee under the terms of this Plan and in accordance with such procedures as the Committee may establish from time to time.

(e)“Board” means the Board of Directors of the Company.

(f)“Cause” shall have the same meaning as prescribed in the Participant’s then current Employment Agreement. If a Participant does not have an Employment Agreement, or if such Employment Agreement does not contain a definition of “Cause,” then Cause shall mean:

(i)an act of theft, forgery, fraud, misappropriation, embezzlement, or other similar action by the Participant against the Company or any of its Affiliates;

(ii)a willful and knowing violation by the Participant of any law, order, rule or regulation of any court or governmental or regulatory body or authority, which is or could reasonably be expected to be materially injurious to the business, properties, assets, results of operations, or condition (financial or otherwise) of the Company;

(iii)a conviction of the Participant of, or plea of guilty or nolo contendere by the Participant to, any felony;

(iv)a violation by the Participant of any fiduciary duty or duty of loyalty owed by the Participant to the Company or any of its Affiliates, and if a cure is possible, a failure to cure after reasonable opportunity (of not less than ten (10) days after notice thereof is given to the Participant by the Company) to cure such violation;

(v)a material breach by the Participant of a material provision of the Participant’s Employment Agreement after notice, and if a cure is possible, failure to cure after a reasonable opportunity (of not less than ten (10) days after notice thereof is given to the Participant by the Company) to cure such material breach; or

(vi)the loss/suspension of any license issued by any state or other regulatory body necessary for the Participant to conduct his or her duties.

(g)“Change in Control” shall have the same meaning as provided in the Company’s Amended and Restated 2015 Omnibus Equity Incentive Plan, provided, however, that an event shall not be considered a Change in Control for purposes of the Plan unless and until such event constitutes a “change in the ownership” or a “change in the ownership of a substantial portion of the assets” of the Company within the meaning of Treas. Reg. §1.409A-3(i)(5).

(h) “Change in Control Bonus” shall mean the bonus payable to a Participant upon a Change in Control, in accordance with and subject to the terms and conditions of the Plan.

(i)“Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor statutory provisions.

(j)“Committee” means the Compensation Committee of the Board of Directors of the Company, or such other person(s) or committee as may be subsequently appointed by the Board of Directors of the Company to administer the Plan.

(k)“Disabled” means either (i) the Participant’s total and permanent disability as defined in Section 22(e)(3) of the Code, or (ii) the Participant’s disability within the

meaning of a long-term disability plan in which the Participant participates that is sponsored by the Company and then in effect.

(l)“Employment Agreement” means the then current written employment agreement between the Participant and the Company (or its Affiliate, as applicable).

(m)“Good Reason” shall have the same meaning as prescribed in the Participant’s then current Employment Agreement. If a Participant does not have an Employment Agreement, or if such Employment Agreement does not contain a definition of “Good Reason,” then Good Reason shall mean:

(i)a material diminution in Participant’s base salary or bonus opportunities (except for diminutions imposed that are proportionate to those imposed on other similarly situated executives or employee of the Company as part of a broader compensation reduction effort by the Company);

(ii)a material diminution in the Participant’s authority, sales territory (if applicable), duties or responsibilities inconsistent with Participant’s current position (as provided in the Participant’s Employment Agreement, if applicable);

(iii) a material change in the Participant’s principal place of employment, which shall mean relocation of the Participant’s principal place of employment by more than fifty (50) miles; or

(iv)any material breach by the Company (or its Affiliate, as applicable) of the Participant’s Employment Agreement or other material written agreement between the Participant and the Company (or its Affiliate, as applicable);

provided that, in order for a termination by a Participant to constitute a termination for “Good Reason” (A) the Participant shall give the Company written notice of the Participant’s intention to resign with Good Reason within forty-five (45) days following the initial occurrence of the circumstances that purportedly gave rise to Good Reason, which written notice shall describe such circumstances in reasonable detail, (B) the Company shall have a period of thirty (30) days following receipt of such written notice to cure such circumstances, and (C) if the Company fails or refuses to cure such circumstances, the Participant must resign within thirty (30) days following the expiration of such cure period.

(n)“Participant” means each employee who is designated by the Committee as a Participant and who meets any other conditions to participation as specified by the Committee, in accordance with the terms of the Plan.

(o)“Per Share Price” shall mean the price or value ascribed to a share of Company stock in connection with a Change in Control.

(p)“Person” means any individual, corporation, partnership, association, tribe, trust, business trust, limited liability company, joint venture, joint stock company, pool, syndicate, sole proprietorship, unincorporated authority, governmental authority or other form of entity or group.

(q)“Plan” means this Blue Bird Corporation Change in Control Plan, as amended and/or restated from time to time.

(r)“Qualifying Termination” shall mean the termination of the Participant’s employment (i) due to the Participant’s death or Disability, (ii) by the Company (or the acquirer) or an Affiliate thereof without Cause, or (iii) by the Participant with Good Reason.

(s)“Section 409A” means Section 409A of the Internal Revenue Code of 1986, as amended, and the final regulations and any guidance promulgated thereunder.

(t)“Severance” means the severance benefits payable to a Participant under, and subject to and in accordance with, the terms and conditions of, the Plan.

Article 3. Administration.

Section 3.1 Administration. The Plan shall be administered by the Committee. As administrator of the Plan, the Committee shall have full authority to interpret the Plan and to decide all questions concerning the Plan, including, without limitation, determination of eligibility for and calculation of Plan benefits, and construction of Plan terms. The Committee’s interpretation of the Plan and its resolution of questions regarding the Plan shall be final and binding on all Participants. The Committee may establish, adopt, and revise such rules, regulations, guidelines, forms of agreements, and instruments relating to the Plan or appoint such designees with respect to the administration of the Plan as it may deem necessary or advisable for the administration of the Plan. The acts of a majority of the total membership of the Committee at any meeting or the acts approved in writing by all of its members shall be the acts of the Committee.

Section 3.2 Interpretation. Except as limited by applicable law and subject to the provisions herein, the Committee shall have full power and authority among other things:

(a) To select, in the Committee’s sole discretion, Participants to whom Awards shall be granted from time to time in accordance with Section 4 of the Plan;

(b) To determine the terms and conditions of any Award granted hereunder;

(c) To adjust the terms and conditions, at any time or from time to time, of any Award, subject to the provisions of this Plan;

(d) To determine whether a Participant has a Disability or has died;

(e) Subject to the provisions of this Plan, to cancel outstanding Awards;

(f) To require as a condition of the acceptance of an Award or the payment thereof, the withholding of any applicable foreign, federal, state or local taxes;

(g) To determine whether and with what effect an individual has incurred a termination of employment, including whether such termination was with or without Cause;

(h) To determine whether an event, including a merger, consolidation or other combination of the Company, constitutes a Change in Control;

(i) To adopt, amend and rescind such rules and regulations as, in its opinion, may be advisable in the administration of this Plan;

(j) To amend or modify the Plan, subject to and in accordance with the terms of the Plan; and

(k) To appoint and compensate agents, counsel, auditors or other specialists to aid it in the discharge of its duties.

The policies and procedures of the Committee may differ with respect to Awards granted at different times or to different Participants.

Section 3.3 Limitations on Authority. Notwithstanding the foregoing, the Committee may not interpret or construe the terms of the Plan in a manner that would otherwise materially increase the cost or materially increase the type or scope of benefits, whether individually or in the aggregate, to be provided under the Plan without the written consent of the Board.

Section 3.4 No Liability for Plan Actions. Neither the Committee nor any designee shall be liable for any action, determination or interpretation made in good faith with respect to the Plan or any distribution paid under the Plan made in good faith. All expenses and liabilities that the Committee incurs in connection with the administration of this Plan will be borne by the Company. Each member of the Committee shall be fully justified in relying or acting in good faith upon any information furnished in connection with the administration of the Plan by any appropriate person or persons other than himself. In no event shall any person who is or shall have been a member of the Committee or any designee be held liable for any determination made, or other action taken, or any omission to act in reliance upon any such information as referred to in the preceding sentence, or for any action (including the furnishing of information) taken, or any omission to act, when any such determination, action or omission is made in good faith.

Section 3.5 Indemnification of Committee and Designees. Each Person who is or shall have been a member of the Committee or a designee authorized under this Plan shall be indemnified and held harmless by the Company against and from any and all liabilities, losses, damages, judgments, awards, settlements, penalties, fines, taxes, claims, cost and expenses, including reasonable attorney’s fees (collectively, “Losses”) that may be imposed upon or reasonably incurred by him in connection with or resulting from any action, claim, cause of

action, controversy, proceeding, demand, dispute, investigation, litigation or suit (“Claim”) to which such Person may be or become involved by reason of any action taken or failure to act under the Plan or any determination or interpretation with respect to the Plan or any distribution thereunder and against and from any and all Losses paid by such Person in settlement thereof (with the Company’s prior written approval) or paid by such Person in satisfaction of a judgment in any such proceeding, except a judgment in favor of the Company based upon a finding of such Person’s lack of good faith; subject, however, to the condition that upon the institution of any Claim against such Person, such Person shall in writing give the Company an opportunity, at its expense, to handle and defend the Claim before such Person undertakes to handle and defend it on such Person’s own behalf. The foregoing right of indemnification shall not be exclusive of any other right to which such Person may be entitled as a matter of law or otherwise, or any obligation that the Company may have to indemnify such Person or hold such Person harmless.

Article 4. Eligibility.

Section 4.1 Eligibility Generally. Any manager, officer, or employee may be selected as a Participant in the Plan. The Committee shall have the authority to designate employees or groups of employees as Participants by job title, class, job band, or similar classification. Awards may be granted to Participants at such times as determined by the Committee.

Section 4.2 Award Agreements and Conditions. Unless otherwise determined by the Committee, each Award shall be evidenced by an Award Agreement which shall set out the material terms of the Award, in substantially the same form as provided in Exhibit B hereto. For the avoidance of doubt, (i) no Change in Control Bonuses or Severance will be paid under this Plan unless and until a Change in Control occurs, and (ii) no manager, officer, or employee shall become a Participant unless and until selected by the Committee for participation and, if required by the Committee, an Award Agreement is fully executed by both the Participant and an authorized representative of the Company.

Article 5. Awards.

Section 5.1 Change in Control Bonus Amount. In the event of a Change in Control of the Company, subject to Section 5.4 hereof, each Participant shall be entitled to receive a Change in Control Bonus, calculated as the Participant’s target payout under the Company’s Annual Management Incentive Plan for the year in which the Change in Control occurs, subject to a multiplier in accordance with the following chart based upon the Per Share Price in connection with the Change in Control:


Per Share Price			Change in Control Bonus - Annual Management Incentive Plan Target Multiplier
Less than $25			2
$25			3
$30			4
$35			5
$40 or more			6

The Per Share Price shall be determined by the Committee. In the event a Participant is not participating in or otherwise does not have a target payout under the Annual Management Incentive Plan for the year in which the Change in Control occurs, the Committee shall determine an amount to be used as such Participant’s Annual Management Incentive Plan payout target solely for purposes of this Plan, in its sole discretion. For the avoidance of doubt, (i) the above multiplier shall apply for purposes of this Plan only (and shall not have any impact on the amount, if any, any Participant is eligible to receive under the Annual Management Incentive Plan), and (ii) the applicable multipliers reflected in the chart above will only apply if the corresponding Per Share Price thresholds are met or exceeded; there will be no interpolation or proration between thresholds.

Section 5.2 Change in Control Bonus Payment Timing and Form. Any Change in Control Bonus payable hereunder shall be paid in a lump sum on or as soon as reasonably practicable (but in no event more than sixty (60) days) following the closing of the Change in Control. The Change in Control Bonus shall be payable in cash; provided, however, that, to the extent the proceeds from the Change in Control are payable (in whole or in part) in a form other than cash, contingent upon and subject to the receipt of prior stockholder approval in accordance with NASDAQ regulations, the Committee may provide that all or a portion of the Change in Control Bonus (for all or select Participant(s)) shall be payable (in whole or in part) in the form of fully vested shares of the Company (or the acquirer or resulting company, as applicable). The Committee may require that a Participant execute a general release of claims in favor of the Company (and the acquirer) as a condition of payment of the Change in Control Bonus.

Section 5.3 Severance Benefits. In the event a Participant experiences a Qualifying Termination within eighteen (18) months following the closing of a Change in Control, the Participant shall receive a lump sum, cash Severance payment equal to such Participant’s annualized base salary (or if applicable, the hourly equivalent, as determined by the Company in its sole discretion). The Severance payment shall be payable within sixty (60) days following the date of the Participant’s termination of employment, provided that if such sixty (60) day period spans two calendar years, the Severance payment shall be made in the second taxable year. Unless otherwise determined by the Committee, the Participant shall be required to execute a

general release of claims in favor of the Company (and the acquirer), and for such release to become irrevocable, prior to the expiration of such sixty (60) day period, as a condition of payment of Severance hereunder. If a Participant is potentially eligible to receive severance benefits from the Company and/or one of its Affiliates under any other plan, agreement, or program (the “Alternative Severance”), then the terms of such Alternative Severance under such other plan, agreement, or program shall apply in lieu of this Section 5.3; provided, however, that if (i) the amount of severance payable under this Section 5.3 exceeds the amount of the Alternative Severance (without regard to any time value of money considerations due to differences in payment timing), and (ii) the Alternative Severance arrangement is not considered deferred compensation subject to Section 409A of the Code, in each case as determined by the Committee in its sole discretion, then the severance provisions of this Section 5.3 shall replace and apply in lieu of the Alternative Severance.

Section 5.4 Employment Required. Except as otherwise provided in this Section 5.4, a Participant must remain employed with the Company in good standing through the date of a Change in Control in order to receive any Change in Control Bonus and/or Severance benefits under the Plan. Except as provided in Section 5.4 hereof, if a Participant’s employment with the Company is terminated prior to the date of a Change in Control for any reason, such Participant’s Award shall be forfeited to the Company for no consideration. Notwithstanding the foregoing, (i) in the event a Participant is terminated due to the Participant’s death or Disability, or by the Company without Cause, and a Change in Control occurs within six (6) months following the date of the Participant’s termination, the Participant shall receive their Change in Control Bonus as provided in Sections 5.1 and 5.2 above, provided that such Change in Control Bonus may, at the sole discretion of the Committee, be prorated portion based upon the number of whole and partial months elapsed between the date of the Participant’s termination of employment and the closing of the Change in Control, as determined by the Committee in its sole discretion, and (ii) in the event a Participant is terminated by the Company without Cause as of the date of the Change of Control due to the Participant not receiving an offer of employment with the acquirer or one of its Affiliates, the Participant shall be eligible to receive the Severance benefits under and in accordance with Section 5.3 hereof.

Section 5.5 Clawback, Offset and Recovery of Awards and Award Payments.

(a) By accepting an Award, each Participant agrees to and shall return to the Company (or agree to the cancellation of) any and all Award amounts, both paid and unpaid, based upon a determination made by the Committee pursuant to any of Section 5.6(b)–(f) hereof. The Committee shall impose a clawback authorized below to the extent determined appropriate by the Committee. All determinations by the Committee shall be final and binding on the Participant.

(b) Miscalculation of Award Amounts. If the Committee determines, in its sole and absolute discretion, that the amount of an Award was calculated incorrectly, whether or not the Company or any Affiliate of the Company is required to restate its or their financial statements and without regard to whether such miscalculation was due to fraud or intentional misconduct, the Committee may require reimbursement of all or part of an Award previously paid to a Participant and/or authorize the cancellation of unpaid

Award amounts by which any such Award exceeded a lower payment that would have been made based on the correct financial metrics. In addition, to the extent required by applicable law, the Awards shall be subject to the clawback requirements of (i) Section 954 of the Dodd-Frank Act (regarding recovery of erroneously awarded compensation) and the rules and regulations thereunder; (ii) similar rules under the applicable laws of other jurisdictions; and (iii) policies adopted by the Company to implement such requirements, all to the extent determined by the Committee in its sole discretion to be applicable to such Participant or Award.

(c) Restrictive Covenants. If the Committee in its sole discretion determines that any Participant has breached any restrictive covenant contained in Participant’s Employment Agreement or any other agreement between the Participant and the Company or any Affiliate of the Company that contains applicable restrictive covenants, then such Participant will not be eligible to receive any unpaid Award amounts under the Plan and such Participant shall be required to repay to the Company all or a portion of the Awards previously paid. Unpaid Awards shall be subject to cancellation as determined in the sole discretion of the Committee.

(d) Other Negligent or Intentional Misconduct. If the Committee in its sole discretion determines that any Participant, through negligence or intentional misconduct, has caused the Company or any Affiliate of the Company to incur any Losses (as defined in Section 3.5 hereof) to a third party, such Participant shall be responsible for reimbursing the Company or any Affiliate of the Company for such Losses. If such Participant does not reimburse the Company or any Affiliate of the Company immediately upon demand, the Company or any Affiliate of the Company may apply any unpaid Award under this Plan to offset such Losses to the full extent permitted by applicable law.

(e) Applicable Law. Without limiting the foregoing, all Awards shall be subject to reduction, cancellation, forfeiture or recoupment to the extent necessary to comply with applicable law.

(f) Forfeiture for Certain Misconduct. Any Participant who, in any capacity with the Company, knowingly falsifies, manipulates, or is grossly negligent in the processing of information in connection with the computation of an Award or payments under the Plan will forfeit any unpaid Award and will be subject to disciplinary action, up to and including termination.

Section 5.6 Section 280G.

(a) 280G Cutback Generally. Notwithstanding the foregoing provisions of the Plan or any other arrangement or agreement with any Participant to the contrary, if any of the Award amounts otherwise payable hereunder to any Participant, when combined with all other payments and benefits to such Participant that would be considered “parachute payments” within the meaning of Section 280G(b)(2) of the Code (collectively, the “Payments”), will be subject to the tax imposed by Section 4999 of the Code, or any similar tax that may hereafter be imposed (the “Excise Tax”), then (i) if the current fair market value of the Payments, less the amount of

the Excise Tax and all other applicable taxes (the “Net Payments”), exceeds the amount that the Participant would receive if the Payments were reduced to one dollar less than 300% of the Participant’s “base amount” within the meaning of Code Section 280G(b)(3) (the “280G Threshold”) after taking into account all applicable taxes on such amount, as determined hereunder, the payments as provided herein shall be made; and, (ii) if the Net Payments would not exceed the fair market value of the Payments if reduced to the 280G Threshold less all applicable taxes, the Company shall “cut-back” the Payments to the Participant as provided herein. For the avoidance of doubt, each Participant shall be solely responsible for any Excise Tax imposed with respect to any such Payments, and under no circumstances shall the Company be required to make payment of the Excise Tax or to provide any Participant with any form of “gross-up” payment with respect to any Excise Tax.

(b) Cutback Procedure. In the event of a cut-back, the Company shall reduce the Payments to the impacted Participant until such Payments do not exceed the 280G Threshold, as reasonably determined by the Company in good faith as provided herein. For purposes hereof, the Participant’s “base amount,” the current fair market value of the Payments, the determination as to whether the Payments are to be cut back (as provided herein), and if so, the amount of the cut-back, shall be determined by the Company’s certified public accountant (or a certified public accountant or auditor designated by the Company’s certified public accountant) as soon as reasonably practicable, and in no event later than thirty (30) days following the date of the Change in Control. The expense of such determinations shall be borne by the Company.

Section 5.7 No Duplication of Benefits or Triggering Events. For the avoidance of doubt, once a Change in Control of the Company (as defined hereunder) has occurred, the Plan shall be considered frozen except to the extent of benefits payable under Sections 5.1-5.3 on and following such Change in Control; no subsequent Change in Control event(s) shall trigger additional benefits under the Plan.

Article 6. Plan Term; Amendment or Termination of the Plan.

Section 6.1 Plan Term. The Plan shall automatically terminate, and no Participant shall have any further rights hereunder, in the event a Change in Control has not occurred on or prior to the three (3) year anniversary of the Effective Date.

Section 6.2 Plan Termination or Amendment. The Plan may be amended, modified or terminated at any time by the Committee; provided, however, except as expressly provided for by the terms of this Plan, the Committee may not, without the applicable Participant’s written consent, amend or terminate the Plan in any way that reduces the amount of cash (or property of equivalent value, if properly and legally authorized) payable to a Participant under any existing Award. Any amendment to or termination of the Plan will be made in writing and approved by the Committee.

Article 7. Assumption by Successor.

Any successor to the Company or to all or substantially all of the Company’s business and/or assets (whether direct or indirect and whether by purchase, merger, consolidation, liquidation or otherwise) hereof will assume the obligations under this Plan and agree expressly

to perform the obligations under this Plan in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. Except as provided above, for all purposes under this Plan, the term “the Company” will include any successor to the Company or to the business and/or assets of the Company that becomes bound by the terms of this Plan by operation of law or otherwise.

Article 8. No Guarantee of Future Service.

Participation in the Plan will not provide any guarantee or promise of continued service of the Participant with the Company or any Affiliate of the Company or any right to participate in any other benefit plan of the Company or any other Affiliate of the Company. The Company and any other Affiliate of the Company by which Participant may be employed retains the right to terminate the employment of any Participant at any time, with or without Cause, for any reason or no reason. However, a Participant who terminates employment may be entitled to benefits under the Plan as provided herein depending upon the circumstances of the Participant’s termination.

Article 9. Taxes.

Section 9.1 Tax Withholding. Awards paid under the Plan will be subject to all applicable federal, state, and local withholding taxes as well as all other applicable withholdings. The Company or any Affiliate of the Company shall be entitled to withhold from any payments or other distributions under the Plan any amount required to satisfy any applicable income, employment and other tax withholding obligations.

Section 9.2 Code Section 409A. Notwithstanding anything to the contrary in this Plan, this Plan and the Awards issued hereunder are intended to be and shall be interpreted so as to comply with Section 409A of the Code, and the regulations and guidance promulgated thereunder, or an exemption therefrom, in both form and operation. Awards under the Plan shall be exempted from Section 409A, including the “short-term deferral” and “separation pay” exceptions pursuant to Treasury Regulations 1.409A-1(b)(4) and (b)(9), respectively, to the maximum extent permissible. Any provision that would cause the Plan or any Award granted under the Plan to fail to satisfy Section 409A (or an exemption therefrom) shall have no force or effect until amended to comply with Section 409A, which amendment may be retroactive to the extent permitted by Section 409A. For purposes of Severance benefits under the Plan, a termination of employment shall not be considered to have occurred unless and until such termination constitutes a “separation from service” within the meaning of Treasury Regulation 1.409A-1(h). Notwithstanding any other provision of the Plan, if any payment provided to a Participant in connection with the Participant’s separation from service is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A and the Participant is determined to be a “specified employee” as defined in Section 409A(a)(2)(b)(i), then such payment shall be delayed until the earlier of six (6) months or the Participant’s death, as applicable.

Section 9.3 No Company Liability for Taxes. Notwithstanding the foregoing, neither the Company nor the Committee nor any Affiliate of the Company shall have any obligation to take any action to prevent the assessment of any additional tax or penalty on any

Participant under Section 409A of the Code or otherwise. Neither the Company, the Committee, the Board, nor any Affiliate of the Company will have any liability to any Participant for such tax or penalty, and neither the Company, the Committee, the Board, or any Affiliate thereof shall have any obligation to reimburse any Participant for any taxes that may be imposed on him or her as a result of Section 409A or otherwise.

Article 10. Funding.

No provision of the Plan will require the Company or any Affiliate of the Company, for the purpose of satisfying any obligations under the Plan, to purchase assets or place any assets in a trust or other entity to which contributions are made or otherwise to segregate any assets, nor will the Company or any other Affiliate of the Company maintain separate bank accounts, books, records or other evidence of the existence of a segregated or separately maintained or administered fund for such purposes. Nothing contained in this Plan and no action taken pursuant to the provisions of any Award Agreement will create or be construed to create a trust of any kind. No property that may be acquired or invested by the Company in connection with the Plan or otherwise will be deemed a security for the obligations to the Participants hereunder, but will be, and continue for all purposes to be, part of the general funds of the Company. Participants will have no rights under the Plan other than as unsecured general creditors of the Company.

Article 11. Plan Status.

This Plan shall be a non-qualified, unfunded deferred compensation plan for tax purposes and an unfunded plan for employees who are members of a select group of management or highly compensated employees of the Company (a “top hat” plan) for purposes of the Employee Retirement Income Security Act of 1974.

Article 12. Miscellaneous.

Section 12.1 Nonassignability of Awards; Beneficiary Designation. To the maximum extent permitted by applicable law, a Participant’s right or benefits under this Plan will not be subject to anticipation, alienation, sale, assignment, pledge, encumbrance or charge, and any attempt to anticipate, alienate, sell, assign, pledge, encumber or charge the same will be void. No right or benefit hereunder will in any manner be subject to the debts, contracts, liabilities or torts of the Participant entitled to such benefit. Notwithstanding the foregoing, each Participant under the Plan may from time to time name a Beneficiary to whom an Award is payable in case of such Participant’s death. Each designation will revoke all prior designations by the same Participant, shall be in a form reasonably prescribed by the Committee and shall be effective only when filed by the Participant in writing with and accepted by the Company during the Participant’s lifetime on a beneficiary designation form in substantially the form attached as Appendix A hereto or as otherwise required by the Committee. The records of the Company at the time of Participant’s death shall be conclusive as to the identity of the Participant’s Beneficiary and the amount properly payable, and payment made in accordance with such facts, shall constitute a complete discharge of any and all obligations hereunder. If no beneficiary designation is on file with the Company at the time of death of the Participant, or if the Committee concludes that such designation is or may not be effective or valid for any reason,

then the Awards may be paid to the deceased Participant’s spouse, if living. If such spouse does not survive Participant, payment of any Award shall be made to the Participant’s estate.

Section 12.2 Severability. If any provision of the Plan is found to be invalid or unenforceable, such provision shall not affect the other provisions of the Plan, and the Plan shall be construed in all respects as if such invalid provision had been omitted.

Section 12.3 Governing Law. Except where preempted by applicable U.S. federal law, this Plan, any Award Agreement hereunder, and the rights and obligations of the parties hereto with respect to the subject matter hereof shall be interpreted and enforced in accordance with, and governed exclusively by, the laws of the State of Georgia, excluding any conflict or choice of law provisions of that State that would result in the application of the law of any other jurisdiction and without regard to the location or locations at which a Participant is employed by the Company or any Affiliate.

Section 12.4 Dispute Resolution.

(a) Any action, claim, cause of action, controversy, demand, dispute, disagreement, inquiry, investigation, litigation, suit, assertion of non-compliance or violation or assertion of liability or potential liability, whether based on contract, tort or otherwise (except for the commencement of any judicial Proceeding for preliminary or injunctive relief contemplated by Section 12.4(d)) that may arise between Participant (or anyone seeking to claim through Participant) and the Company or any Affiliate of the Company concerning any subject matter, issue, or circumstance whatsoever with respect to this Plan, including but not limited to the Participant’s service as an employee of the Company or any Affiliate of the Company with respect to this Plan or the Participant’s Award under or with respect to the Plan, or their interpretation and any of the matters in the Plan, and the continuation, performance, interpretation, or breach of the terms of the Plan (or any other agreement related thereto) between Participant (or anyone seeking to claim through Participant) and the Company or any Affiliate of the Company, whether entered into or arising before, on or after the Effective Date), at the request of the Company or Participant shall be exclusively determined by arbitration, which arbitration shall be final and binding to the maximum extent permitted by the Federal Arbitration Act (“FAA”) and any other applicable laws.

(b) Notwithstanding the foregoing, prior to submitting any matter to binding arbitration, the parties (including the Company and relevant Participant(s)) shall first attempt to resolve such dispute in good faith through mediation administered in accordance with the American Arbitration Association’s Mediation Procedures. Any dispute unresolved by such mediation may be submitted to binding arbitration in accordance with Section 12(a) hereof.

(c) Except as expressly provided in this Section 12, the Company and each Participant hereby agree to waive any right to have any Claim between them resolved in a court of law by a judge or jury.

(d) Such mediation and arbitration shall be administered by the American Arbitration Association (the “AAA”) pursuant to the FAA in accordance with this Plan and the Commercial Arbitration Rules of the AAA (“AAA Rules”). Any mediation or arbitration shall take place in

Macon, Georgia, and any such mediation or arbitration shall be conducted before a single mediator or arbitrator (as applicable) appointed in accordance with the AAA Rules and this Section 12, who shall be experienced in corporate, benefit, and employment law matters.

(e) Judgment upon any award rendered by the arbitrator hereunder may be entered in and enforced by any court having jurisdiction and in accordance with the practice of such court, subject only to vacation or modification as permitted by applicable laws.

(f) Notwithstanding Section 12(a), the Company or any Affiliate of the Company, without bond, may seek and obtain temporary or injunctive relief against Participant, in any court of proper jurisdiction with respect to any and all temporary or preliminary injunctive or restraining procedures in connection with the Plan, including any breach or threatened breach by Participant of the terms of the Plan. For the purposes of enforcing this provision, the Company, the Committee, and each Participant expressly consents to the personal jurisdiction of the federal and state courts having territorial jurisdiction over Bibb County, Georgia.

(g) Any forbearance or delay in enforcing the rights under this Section 12 shall not operate as a waiver of any rights under this Plan.

(h) This agreement to arbitrate shall survive the termination of the Participant’s employment with the Company or any Affiliate of the Company, and termination of the Plan.

Section 12.5 Injunctive Relief. Each Participant understands, acknowledges and agrees that, in the event of a breach or threatened breach by Participant of the terms of the Plan, the Company and its Affiliates will suffer irreparable damage that cannot be adequately compensated by a monetary award. Participant recognizes that, in the event Participant fails to perform, observe or discharge any of Participant’s obligations or liabilities in connection with the Plan, any remedy of law may prove to be inadequate to the Company and its Affiliates. Therefore, Participant agrees that the Company and its Affiliates, at the option of such Persons, may be entitled to temporary or permanent injunctive relief in any case without the necessity of proving actual damages. Any provisions to the contrary herein notwithstanding, the law applicable in the jurisdiction of such court shall apply with respect to, but limited to, all such temporary or preliminary injunctive or restraining procedures. Participant further acknowledges, however, that the Company and its Affiliates shall have the right to seek a remedy at law (including, without limitation, seeking such damages as it can show it has sustained by reason of such breach) as well as or in lieu of equitable relief in the event of any such breach.

Section 12.6 Headings. The headings in the Plan are inserted for convenience only and will not be deemed to constitute a part hereof nor to affect the meaning thereof.

Section 12.7 Entire Agreement. This Plan constitutes the entire understanding and agreement with respect to the subject matter contained herein, and, other than Award Agreements with individual Participants, there are no agreements, understandings, restrictions, representations or warranties among any Participant and the Company or any Affiliate of the Company other than those as set forth or provided for herein.

WHEREAS, the Plan has been approved as of the Effective Date.

BLUE BIRD CORPORATION

/s/ Philip Horlock

By: Phil Horlock

Its: Chief Executive Officer

APPENDIX A

[FORM OF BENEFICIARY DESIGNATION]

BLUE BIRD CORPORATION CHANGE IN CONTROL PLAN

BENEFICIARY DESIGNATION

PARTICIPANT NAME: ________________________________________________________
whose address is _______________________________________________________________.

With respect to any amount payable to me, the undersigned Participant under the Blue Bird Corporation Change in Control Plan (the “Plan”), following my death, I hereby revoke any prior beneficiary designation heretofore made by me under the Plan, and in lieu thereof, I hereby designate the following as my Beneficiary:

BENEFICIARY:

100% to , whose address is .

In the event my Beneficiary is not living at the time of my death, any amount payable under the Plan is to be paid to my estate.

Executed by the undersigned Participant this _____ day of __________________, ________.

___________________________________

SIGNATURE OF PARTICIPANT

APPENDIX B

[FORM OF AWARD AGREEMENT]

BLUE BIRD CORPORATION CHANGE IN CONTROL PLAN

AWARD AGREEMENT

PARTICIPANT: [NAME]

DATE OF AWARD AGREEMENT: [●]

Blue Bird Corporation, a Delaware corporation, (the “Company”) is pleased to inform the above-named Participant (“Participant” or “you”) that you have been designated as a Participant under the Blue Bird Corporation Change in Control Plan (the “Plan”).

1.Plan Terms Control. Unless otherwise defined herein, the terms defined in the Plan will have the same meanings in this Award Agreement. All applicable terms, provisions, and conditions set forth in the Plan and not set forth herein are hereby incorporated by reference herein. To the extent any provision hereof is inconsistent with a provision of the Plan, the provisions of the Plan will govern.

2.Award. Pursuant to the terms of the Plan, you are hereby granted an Award under the Plan, in conformity with and to be calculated in accordance with the terms and conditions of the Plan, which potentially includes a Change in Control Bonus and Severance. For the avoidance of doubt, no benefits will be payable under the Plan unless and until a Change in Control has occurred (and with respect to the Severance, in the event of a Qualifying Termination within eighteen (18) months following the Change in Control).

3.Withholding. All Award payments shall be less applicable withholding taxes. The Company shall have the right to deduct from any and all payments made in connection with the Award the federal, state, local and foreign taxes, if any, required by law to be withheld by the Company with respect to the Award.

4.Award Confidentiality. You agree to maintain in complete confidence the existence of this Award Agreement, your participation in the Plan and the contents and terms of this Award Agreement (collectively, the “Award Information”). Except as required by applicable law, you may disclose Award Information only to your immediate family members, the court in any proceedings to enforce the terms of this Award Agreement and the Plan, and your accountant and any professional tax or legal advisor to the extent that they need to know the Award Information in order to provide advice on tax treatment or to prepare tax returns, and must use your reasonable best efforts to prevent disclosure of any Award Information to all other

third parties. You agree that you will not publicize, directly or indirectly, any Award Information. You acknowledge and agree that any unauthorized disclosure of Award Information may cause you to forfeit rights arising under the Award Agreement and the Plan, including rights to payment, and also may require you to refund any payments you have received under this Award Agreement and the Plan to the Company.

5.Entire Agreement. This Agreement and the Plan constitute the entire understanding and agreement between Participant and the Company regarding this Award. Except as otherwise provided under the Plan, this Agreement may only be modified or amended by written agreement executed by the parties hereto.

6.No Right to Continued Employment. Nothing in the Plan or this Agreement shall confer any right to continued employment with the Company, or interfere in any way with the right of the Company to terminate the Participant’s employment at any time.

Accepted by Participant

Signature

Print Name

Received

Date:

BLUE BIRD CORPORATION

By:

Its:

OMNIBUS AMENDMENT TO OUTSTANDING STOCK OPTION AND RESTRICTED STOCK UNIT AWARDS UNDER THE AMENDED AND RESTATED

BLUE BIRD CORPORATION 2015 OMNIBUS EQUITY INCENTIVE PLAN

This Omnibus Amendment is hereby made by the Compensation Committee (the “Committee”) of the Board of Directors of Blue Bird Corporation (the “Company”) to all Outstanding Awards (as defined below) under the Company’s Amended and Restated 2015 Omnibus Equity Incentive Plan, as amended (the “Plan”), effective as of this _25th__ day of _January__, 2024 (the “Effective Date”).

WHEREAS, the Company previously granted, and there are currently outstanding, Awards of Stock Options and Restricted Stock Units to Participants (as such terms are defined in the Plan) under the Plan;

WHEREAS, the majority of the Award Agreements for such previously granted Awards do not specifically address the impact of a Change in Control of the Company;

WHEREAS, the Committee has the authority pursuant to Section 3.2 of the Plan to amend the terms of outstanding Awards, provided that such amendment shall not adversely affect the rights of a Participant to an outstanding Award without the impacted Participant’s consent;

WHEREAS, the Committee now desires to amend the Award Agreements for all currently outstanding (and not previously forfeited) Awards of Stock Options and Restricted Stock Units that (i) do not currently contain Change in Control provisions, (ii) are held by Participants who are current employees of the Company or one of its Affiliates as of the Effective Date, and (iii) with respect to Restricted Stock Units, are structured as exempt from (rather than subject to) Section 409A of the Internal Revenue Code of 1986, as amended, (such Awards, collectively, the “Outstanding Awards”); and

WHEREAS, the Committee has determined that this Omnibus Amendment will not adversely impact the affected Participants.

NOW, THEREFORE, BE IT RESOLVED that the Outstanding Awards are hereby amended as follows:

1. Amendment to Stock Options. The Award Agreement for all Outstanding Awards that are Stock Options shall be amended by the addition of the following language to the relevant vesting provisions of the Award Agreement(s):

“Notwithstanding the foregoing, the vesting of all unvested shares of Common Stock subject to the Option not previously forfeited will automatically be accelerated in connection with a “Change in Control”, as defined in the Plan.”

2. Amendment to Restricted Stock Units. The Award Agreement for all Outstanding Awards that are Restricted Stock Units shall be amended by the addition of the following language to the relevant vesting provisions of the Award Agreement(s):

“Notwithstanding the foregoing, to the extent not previously forfeited, the unvested RSUs shall vest immediately upon a “Change in Control”, as defined in the Plan.”

3. Interpretation and Conforming Changes. The revisions made by this Omnibus Amendment, and the relevant Award Agreements (as amended), shall be interpreted so as to reflect the intent of this Omnibus Amendment. The Committee shall have the authority to make additional conforming changes to the relevant Award Agreements to the extent determined necessary to preserve such intent.

4. Defined Terms. Capitalized terms used in this Omnibus Amendment but not otherwise defined shall have the meaning provided in the Plan.

5. Other Provisions Unaffected. Except as hereinabove amended, the provisions of the Outstanding Awards shall continue in full force and effect.

IN WITNESS WHEREOF, the Company has caused this Omnibus Amendment to be duly executed on the date first above written.

BLUE BIRD CORPORATION

By: /s/ Philip Horlock

Its: Chief Executive Officer

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (the ''Agreement"), executed as of the date of signature below, effective as of the 15th day of May 2023, by and between Blue Bird Body Company, a Georgia corporation, and, Blue Bird Corporation, a Delaware corporation (collectively, the ''Company") and Phil Horlock (the "Executive").

WHEREAS, the Company and the Executive (each a ''Party” and together the "Parties") wish to enter into this Agreement pursuant to which the Company will employ the Executive.

NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement, the Parties agree as follows:

1.Employment and Acceptance. The Company shall employ the Executive, and the Executive accepts such employment, subject to the terms of this Agreement, as of May 15, 2023 (the ''Effective Date”).

2.Term. Subject to earlier termination pursuant to Section 5 of this Agreement, this Agreement and the employment relationship hereunder shall continue from the Effective Date until the first (1st)

anniversary of the Effective Date, and shall automatically renew for successive 6-month intervals thereafter unless either Party shall have given at least thirty (30) days advance written notice prior to the expiration of the Term to the other that it does not wish to extend the Term. As used in this Agreement, the "Term” shall refer to the period beginning on the Effective Date and ending on the date this Agreement terminates in accordance with this Section 2 or Section 5.

3.Duties and Title.

3.2 Authority and Responsibilities. As Chief Executive Officer, the Executive will have such authority and responsibilities and will perform such executive duties as may be assigned to him by the Board, including without limitation performing services for affiliates of the Company and its subsidiaries. The Executive will devote substantially all of his full working time and attention to the performance of such duties and to the promotion of the business and interests of the Company. ln order to effectively carry out the duties set forth in this Agreement, the Executive shall reside in the Macon, Georgia area (and agrees to relocate there by the end of calendar year 2023), and maintain a primary office at the Company's corporate offices, and agrees to be physically present at such offices to the extent necessary to effectively fulfill his responsibilities under this Agreement.

4.Compensation and Benefits. As compensation for all services rendered pursuant to this Agreement. the Company shall provide to the Executive the following during the Term:

4.1 Base Salary. The Company will pay to the Executive an annual base salary of One Million Dollars ($1,000,000) payable in accordance with the customary payroll practices of the Company. The Base Salary shall be subject to adjustment from time to time, as determined by the Board or its designee in its sole discretion. For purposes of this Agreement, "Base Salary" shall mean Executive's base salary as adjusted.

4.2 Annual Bonus. For each fiscal year of the Company ("Fiscal Year") during the Term, the Executive shall be eligible to receive an annual variable bonus payment with a target gross amount of 150% of Base Salary (the "Annual Bonus"). The actual amount of the Annual Bonus payment, if any, shall be based on the operational performance of the Company and be subject to achievement of financial or other targets as set by the Board or its designee at the beginning of the Fiscal Year. If such targets are fully achieved, the Executive shall be entitled to 100% of the Annual Bonus. If the targets are under-achieved or over-achieved, the Annual Bonus shall be reduced or increased, as determined by, and in the sole discretion of, the Board or its designee. The formula for calculating the precise bonus payment shall be determined by the Board or any committee thereof designated by the Board for such purpose in consultation with the Executive. The Annual Bonus payment shall be due on the earlier of (i) thirty days after the approval by the Board or the consolidated financial statements of the Company and (ii) the date on which the Company pays annual bonuses to other members of senior management; provided that, in no event will an Annual Bonus be paid later than the 15th clay of the third (3rd) month following the end of the calendar year in which such Fiscal Year ends.

4.3 Participation in Employee Benefit Plans. The Executive shall be entitled, if and to the extent eligible, to participate in all of the applicable benefit plans of the Company, which may be available to other senior executives of the Company. With respect his anticipated move to the Macon, Georgia area, the Executive will be entitled to the applicable Company standard relocation program. Further, the Executive will be paid a onetime cash payment of Seventy-Five Thousand Dollars ($75,000) to cover other moving expenses.

4.4 Expense Reimbursement. The Executive shall be entitled to receive reimbursement for all appropriate traveling and other business expenses incurred by him in connection with his duties under this Agreement in accordance with the policies of the Company as in effect from time to time. Further the Executive will be entitled to a Fifteen thousand dollar ($15,000) monthly travel stipend to cover personal travel.

4.5 Initial Equity Award; Ongoing Participation in the Equity Plan. On or as soon as administratively practicable practicable after the Effective Date, the Company shall grant to the executive, pursuant to the terms of the Company’s Amended and Restated 2015 Omnibus Equity Incentive Plan (as amended or updated from time to time, the “Equity Plan”), Two Million Dollars ($2,000,000) or two time his base salary in equity which will vest July 1, 2025 or upon termination of Executive’s employment for any reason other than for Cause as defined in Section 5.1 below.

The Executive will participate in the Equity Plan with eligibility for additional awards appropriate for the Company's Chief Executive Officer position, as determined by the Board or its designee in its sole

discretion. The Executive's participation in the Equity Plan and rights thereunder shall be subject to the terms of the Equity Plan, this Agreement and any applicable grant or other agreements under the Equity Plan as determined by the Board or its designee.

(a)In the event there is a Change in Control (as defined below) involving the Company during the period of such vesting scheduled and while the Executive remains employed by the Company, all remaining unvested Restricted Shares (“RSUs”) and Stock Options will fully vest upon the Change in Control. For purposes of this Agreement, “Change in Control” means a change in control as such term is defined in the Equity Plan.

4.6 D&O Insurance. During the Term, the Company will obtain and maintain, at the Company’s sole cost and expense, D&O insurance coverage for the benefit of the directors and officers of the Company, the amount of coverage and designated carrier to be determined by, and in the sole discretion of, the Board or its designee.

5.Termination of Employment.

5.1 By the Company for Cause or by the Executive. If: (i) the Company eliminates the Executive's employment with the Company for Cause (as defined below) or (ii) the Executive terminates his employment for any reason, provided that the Executive shall be required to give the Company at least thirty (30) days prior written notice of any termination of employment, the Executive or the Executive's legal representatives (as appropriate), shall be entitled to receive the following:

(a)the Executive's accrued but unpaid Base Salary to the date of termination and any employee benefits the Executive may be entitled to pursuant to the employee benefit plans of the Company; and

(b)expenses reimbursable under Section 4.4 incurred but not yet reimbursed to the Executive to the date of termination.

For the purposes or this Agreement. "Cause" means. as determined by the Board (or its designee), (i) conviction of or plea of nolo contendere to a felony by the Executive; (ii) acts of dishonesty by the Executive resulting or intending to result in personal gain or enrichment at the expense of the Company or its subsidiaries or the affiliates of the Company and their subsidiaries; (iii) the Executive's material breach of his obligations under this Agreement; (iv) conduct by the Executive in connection with his duties hereunder that is fraudulent, unlawful or grossly negligent, including, but not limited to, acts of discrimination; (v) engaging in personal conduct by the Executive (including but not limited to employee harassment or discrimination, the use or possession at work of any illegal controlled substance) which seriously discredits or damages the Company or its subsidiaries or the affiliates of the Company and their subsidiaries; (vi) contravention of specific lawful direction from the Board or its designee or continuing inattention to or continuing failure to adequately perform the duties to be performed by the Executive under the terms of Section 3 of this Agreement or (vii) breach of the Executive's covenants set forth in Section 5.5 or Section 6 below before termination of employment; provided, that, the Executive shall have fifteen (15) days after notice from the Company to cure the deficiency leading to the Cause determination (except with respect to (i) above), if curable. A termination for “Cause" shall be effective immediately (or on such other date determined by the Company).

The Executive's employment pursuant to this Agreement shall terminate automatically on and as of the expiration date of the Term (including any extensions) as described in Section 2. Upon such expiration, the restrictions described in Section 5.5 and Section 6, and related provisions of this Agreement including without limitation Section 7, shall survive such termination and remain in effect by their terms.

5.3Removal from any Boards and Position. If the Executive's employment is terminated for any reason under this Agreement, he shall be deemed to resign, effective as of the date of termination, (i) if a member, from the Board or board of directors of any subsidiary of the Company or any affiliate of the Company and its subsidiaries or any other board to which he has been appointed or nominated by or on behalf of the Company and (ii) from any position with the Company or any subsidiary of the Company or any affiliate of the Company and its subsidiaries, including, but not limited to, as an officer of the Company and any of its subsidiaries or the affiliates of the Company and their subsidiaries.

5.4Nondisparagement. The Executive agrees that he will not at any time (whether during or after the Term) publish or communicate to any person or entity any Disparaging (as defined below) remarks, comments or statements concerning the Company, its parent, subsidiaries and affiliates, and their respective present and former members, partners, directors, officers, shareholders, employees, agents, attorneys, successors and assigns. "Disparaging" remarks, comments or statements are those that impugn the character, honesty, integrity or morality or business acumen or abilities in connection with any aspect of the operation of business of the individual or entity being disparaged.

6.Restrictions and Obligations of the Executive.

5.1Confidentiality.

their other external relationships, their data systems and data bases, and all the information described above (hereinafter collectively referred to as ''Confidential Information"), and any misappropriation or unauthorized disclosure of Confidential Information in any form would irreparably harm the Protected Parties. The Executive acknowledges that such Confidential information constitutes valuable, highly confidential, special and unique property of the Protected Parties. The Executive shall hold in a fiduciary capacity for the benefit or the Protected Parties all Confidential information relating to the Protected Parties and their businesses, which shall have been obtained by the Executive during the Executive's employment by the Company or its subsidiaries and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). Except as required by law or an order of a court or governmental agency with jurisdiction, the Executive shall not, during the period the Executive is employed by the Company or its subsidiaries or at any time thereafter, disclose any Confidential Information, directly or indirectly, to any person or entity for any reason or purpose whatsoever, nor shall the Executive use it in any way, except in the course of the Executive's employment with, and for the benefit of, the Protected Parties or to enforce any rights or defend any claims hereunder or under any other agreement to which the Executive is a party, provided that such disclosure is relevant to the enforcement of such rights or defense of such claims and is only disclosed in the formal proceedings related thereto. The Executive shall take all reasonable steps to safeguard the Confidential Information and to protect it against disclose, misuse, espionage, loss and theft. The Executive understands and agrees that the Executive shall acquire no rights to any such Confidential Information.

(b)All files, records, documents, drawings, specifications, data, computer programs, evaluation mechanisms and analytics and similar items relating thereto or to the Business (for the purposes of this Agreement. "Business" shall be as defined in Section 6.3 hereof), as well as all customer lists, specific customer information, compilations of product research and marketing techniques of the Company and its subsidiaries, and, if applicable, the affiliates of the Company and their subsidiaries, whether prepared by the Executive or otherwise coming into the Executive's possession, shall remain the exclusive property of the Company and its subsidiaries and, if applicable, the affiliates of the Company and their subsidiaries, and the Executive shall not remove any such items from the premises of the Company and its subsidiaries, and, if applicable, the affiliates of the Company and their subsidiaries, except in furtherance of the Executive's duties under any employment agreement.

(c)It is understood that while employed by the Company or its subsidiaries, the Executive will promptly disclose to it, and assign to it the Executive's interest in any invention, improvement or discovery made or conceived by the Executive, either alone or jointly with others, which arises out of the Executives employment. At the Company's request and expense, the Executive will assist the Company and its subsidiaries and, if applicable, the affiliates of the Company and their subsidiaries, during the period of the Executive's employment by the Company or its subsidiaries and, if applicable, the affiliates of the Company and their subsidiaries, and thereafter in connection with any controversy or legal proceeding relating to such invention, improvement or discovery and in obtaining domestic and foreign patent or other protection covering the same.

(d)As requested by the Company and at the Company's expense, from time to time and upon the termination of the Executive's employment with the Company for any reason, the Executive will promptly deliver to the Company and its subsidiaries and, if applicable, the affiliates of the Company and their subsidiaries, all copies and embodiments, in whatever form, of all Confidential Information in the Executive's possession or within his control (including, but not limited to, memoranda, records, notes, plans, photographs, manuals, notebooks, documentation, program listings, flow charts, magnetic media, disks, diskettes, tapes and all other materials containing any Confidential information) irrespective of the location or form of such material. If requested by the Company, the Executive will provide the Company with written confirmation that all such materials have been delivered to the Company as provided herein.

5.1No-Solicitation. During the Term, any extended employment period thereafter and for a period of twenty-four (24) months following the termination of the Executive's employment for any reason, the Executive: (a) shall not directly or indirectly solicit or attempt to solicit or induce, directly or indirectly, any party who is a customer of the Company, or who was a customer of the Company or its subsidiaries at any time during the twelve (12) month period immediately prior to the date the Executive’s employment terminates, for the purpose of marketing, selling or providing to any such party ay services or products offered by or available from the Company or its subsidiaries (provided that if the Executive intends to solicit any such party for any other purpose, he shall notify the Company of such intention and receive prior written approval from the Company), (b) shall not directly or indirectly solicit or attempt to solicit or induce, directly or indirectly, any supplier to Company or any subsidiary to terminate, reduce or alter negatively its relationship with the Company or any subsidiary or in any manner interfere with any agreement or contract between the Company or any subsidiary and such supplier or (c) shall not, either directly, or on behalf of any other person or any entity in competition with the Business of the Company or any of its subsidiaries, hire, offer employment to, or otherwise directly, or indirectly, solicit or attempt to solicit or induce, directly or indirectly the employment of any employee of the Company or any of its subsidiaries or any person who was an employee of the Company or any of its subsidiaries during the twelve (12) month period immediately prior to the date the Executive's employment terminates to terminate such employee's employment relationship with the Protected Parties.

prevent the Executive from owning for passive investment purposes not intended to circumvent this Agreement, less than five percent (5%) of the publicly traded common equity securities of any company engaged in the Business (so long as the Executive has no power to manage, operate, advise, consult with or control the competing enterprise and no power, alone or in conjunction with other affiliated parties, to select a director, manage, general partner, or similar governing official of the competing enterprise other than in connection with the normal and customary voting powers afforded the Executive in connection with any permissible equity ownership).

5.3Property. The Executive acknowledges that all originals and copies of materials, records and documents generated by him or coming into his possession during his employment by the Company or its subsidiaries or, if applicable, the affiliates of the Company and their subsidiaries are the sole property or the Company and its subsidiaries or, if applicable, the affiliates or the Company and their subsidiaries (''Company Property"). During the Term, and at all times thereafter, the Executive shall not remove, or cause to be removed, from the premises of the Company or its subsidiaries or, if applicable, the affiliates of the Company and their subsidiaries, copies of any record, file, memorandum, document, computer related information or equipment, or any other item relating to the Business, except in furtherance of his duties under the Agreement. When the Executive's employment with the Company terminates, or upon request of the Company at any time, the Executive shall promptly deliver to the Company all copies of Company Property in his possession or control.

1.Remedies; Specific Performance. The Parties acknowledge and agree that the Executive's breach or threatened breach of any of the restrictions set forth in Section 5.5 and Section 6 will result in irreparable and continuing damage to the Protected Parties for which there may be no adequate remedy at law and that the Protected Parties shall be entitled to equitable relief, including specific performance and injunctive relief as remedies for any such breach or threatened or attempted breach. The Executive hereby consents to the grant of an injunction (temporary or otherwise) against the Executive or the entry of any other court order against the Executive prohibiting and enjoining him from violating, or directing him to comply with any provision of Section 5.4 and Section 6.

2.Indemnification. The Company agrees, to the extent permitted by applicable law and its organizational documents, to indemnify, defend and hold harmless the Executive from and against any and all losses, suits, actions, causes of action, judgments, damages, liabilities, penalties, fines, costs or claims of any kind or nature (''Indemnified Claim''), including reasonable legal fees and related costs incurred by Executive in connection with the preparation for or defense of any indemnified Claim, whether or not resulting in any liability, to which Executive may become subject or liable or which may be incurred by or assessed against Executive, relating to or arising out of his employment by the Company or the services to be performed pursuant to this Agreement, provided that the Company shall only defend, but not indemnify or hold Executive harmless, from and against an indemnified Claim in the event there is a final, non-appealable, determination that Executive's liability with respect to such indemnified Claim resulted from Executive's willful misconduct or gross negligence. The Company's obligations under this section shall be in addition to any other right, remedy or indemnification which Executive may have or be entitled to at common law or otherwise.

3.Other Provisions.

9.1Notices. Any notice or other communication required or which may be given hereunder shall be in writing and shall be delivered personally, telegraphed, telexed, sent by facsimile transmission or sent by certified, registered or express mail, postage prepaid or overnight mail and shall be deemed given when so delivered personally, telegraphed, telexed, or sent by facsimile transmission or, if mailed, four (4) days after the date of mailing or one (1) day after overnight mail, as follows:

(a)If the Company, to:

Blue Bird Corporation

3920 Arkwright Road

Suite 200

Macon. GA 31210 Attention: Jolene O’Brien Paver Telephone: (478) 951-5754

Email: Jolene.Paver@Blue-Bird.com

(b) If the Executive, to the Executive's home address reflected in the Company’s records.

9.2Entire Agreement. This Agreement contains the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior agreements, written or oral, with respect thereto.

9.3Representations and Warranties by Executive. The Executive represents and warrants that he is not a party to or subject to any restrictive covenants, legal restrictions or other agreements in favor of any entity or person which would in any way preclude, inhibit, impair or limit the Executive's ability to perform his obligations under this Agreement, including, but not limited to, non-competition agreements, non solicitation agreements or confidentiality agreements.

9.4Waiver and Amendments. This Agreement may be amended, modified, superseded, canceled, renewed or extended, and the terms and conditions hereof may be waived, only by a written instrument signed by the Parties or, in the case of a waiver, by the patty waiving compliance. No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any right, power or privilege hereunder, nor any single or partial exercise of any right, power or privilege hereunder, preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

9.5Governing Law, Dispute Resolution and Venue.

(a)This Agreement shall be governed and construed in accordance with the laws of the State of Georgia, without regard to conflicts of laws principles.

(b)The Parties agree irrevocably to submit to the exclusive jurisdiction of the federal courts or, if no federal jurisdiction exists, the state courts, located in Macon, Georgia, for the purposes of any suit, action or other proceeding brought by any party arising out of any breach of any of the provisions of this Agreement and hereby waive, and agree not to assert by way of motion. as a defense or otherwise. in any such suit, action, or proceeding. any claim that it is not personally subject to the jurisdiction of the above named courts, that the suit, action or proceeding is brought in an

inconvenient forum, that the venue of the suit, action or proceeding is improper, or that the provisions of this Agreement may not be enforced in or by such courts.

(c)THE PARTIES HERETO HEREBY WAIVE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT OR THE VALIDITY, INTERPRETATION OR ENFORCEMENT HEREOF. THE PARTIES HERETO AGREE THAT THIS SECTION IS A SPECIFIC AND MATERIAL ASPECT OF THIS AGREEMENT AND WOULD NOT ENTER LNTO THIS AGREEMENT IF THIS SECTION WERE NOT PART OF THJS AGREEMENT.

9.1Section 409A

(a)The parties agree that this Agreement shall be interpreted to comply with or be exempt from Section 409A or the Internal Revenue Code or 1986, as amended, and the Treasury regulations and guidance promulgated thereunder (collectively "Code Section 409A"), and all provisions of this Agreement shall be construed in a manner consistent with the requirements for avoiding taxes or penalties under Code Section 409A. In no event whatsoever will the Company be liable for any additional tax, interest or penalties that may be imposed on the Executive under Code Section 409A or any damages for failing to comply with Code Section 409A.

(b)A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits considered "nonqualified deferred compensation" under Code Section 409A upon or following a termination of employment unless such termination is also a "separation from service" within the meaning of Code Section 409A and, for purposes or any such provision of this Agreement. references to a "termination,'' "termination of employment'' or like terms shall mean "separation from service." If the Executive is deemed on the date of termination to be a "specified employee" within the meaning of that term under Code Section 409A(a)(2)(B), then with regard 10 any payment or the provision or any benefit that is considered nonqualified deferred compensation under Code Section 409A payable on account of a '·separation from service," such payment or benefit shall be made or provided at the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of such "separation from service" of the Executive, and (ii) the date of the Executive's death (the "Delay Period''). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Subsection 11(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed on the first business day following the expiration of the Delay Period to the Executive in a lump sum and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.

(c)With regard to any provision herein that provides for reimbursement of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the right to reimbursement or in-kind benefits shall not be subject 10 liquidation or exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits, to be provided in any other taxable year, and (iii) such payments shall be made on or before the last day of the Executive's taxable

year following the taxable year in which the expense occurred. For purposes of Code Section 409A. the Executive's right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g. ·'payment shall be made within thirty (30) days following the date of termination"). the actual date of payment within the specified period shall be within the sole discretion of the Company.

9.6Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument.

9.8Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning of terms contained herein.

9.9Severability. If any term, provision, covenant or restriction of this Agreement, or any part thereof, is held by a court of competent jurisdiction or any foreign, federal, state, county or local government or any other governmental, regulatory or administrative agency or authority lo be invalid, void, unenforceable or against public policy for any reason, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected or impaired or invalidated. The Executive acknowledges that the restrictive covenants contained in Section 6 are a condition of this Agreement and arc reasonable and valid in temporal scope and in all other respects.

9.10Judicial Modification. If any court determines that any of the covenants in Section 6, or any part of any of them, is invalid or unenforceable, the remainder of such covenants and parts thereof shall not thereby be affected and shall be given full effect, without regard to the invalid portion. If any court determines that any of such covenants, or any part thereof, is invalid or unenforceable because of the geographic or temporal scope of such provision. such court shall reduce such scope to the minimum extent necessary to make such covenants valid and enforceable.

9.11Tax Withholding. The Company or other payor is authorized to withhold from any benefit provided or payment due hereunder, the amount of withholding taxes due any federal, state or local authority in respect of such benefit or payment and to take such other action as may be necessary in the opinion of the Board or its designee to satisfy all obligations for the payment of such withholding taxes.

[Signature Page to Follow]

IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby, have executed this Agreement as of the day and year dated below.

Executive:

/s/ Phil Horlock

Phil Horlock

1/26/2024

Date

Blue Bird Body Company and Blue Bird Corporation

By: /s/ Kevin Penn

Name: Kevin Penn

Title: Chairman of the Board

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (the ''Agreement"), signed as of the date below, effective as of the 1st day of July 2023, by and between Blue Bird Body Company, a Georgia corporation, and, Blue Bird Corporation, a Delaware corporation (collectively, the ''Company") and Britton Smith (the "Executive").

WHEREAS, the Company and the Executive (each a ''Party” and together the "Parties") wish to enter into this Agreement pursuant to which the Company will employ the Executive.

NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement, the Parties agree as follows:

1.Employment and Acceptance. The Company shall employ the Executive, and the Executive accepts such employment, subject to the terms of this Agreement, as of July 1, 2023 (the ''Effective Date”).

2.Term. Subject to earlier termination pursuant to Section 5 of this Agreement, this Agreement and the employment relationship hereunder shall continue from the Effective Date until the first (1st)

anniversary of the Effective Date, and shall automatically renew for successive 12-month intervals thereafter unless either Party shall have given at least sixty (60) days advance written notice prior to the expiration of the Term to the other that it does not wish to extend the Term. As used in this Agreement, the "Term” shall refer to the period beginning on the Effective Date and ending on the date this Agreement terminates in accordance with this Section 2 or Section 5.

3.Duties and Title.

3.1 Title. The Company shall employ the Executive to render services as described herein to the Company on a fulltime basis. Commencing on the Effective Date, the Executive shall serve as President of the Company and shall, unless otherwise detemined by the Board of Directors of the Company (the "Board") report to the Chief Executive Officer and support a smooth leadership transition to execute the Company’s strategy and subject to Board approval, the Executive will be appointed as Chief Executive Officer.

3.2 Authority and Responsibilities. As President, the Executive will have such authority and responsibilities and will perform such executive duties as may be assigned to him by the Chief Executive Officer, including without limitation performing services for affiliates of the Company and its subsidiaries. The Executive will devote substantially all of his full working time and attention to the performance of such duties and to the promotion of the business and interests of the Company. ln order to effectively carry out the duties set forth in this Agreement, the Executive shall reside in the Macon, Georgia area (and agrees to relocate there by the end of calendar year 2023), and maintain a primary office at the Company's corporate offices, and agrees to be physically present at such offices to the extent necessary to effectively fulfill his responsibilities under this Agreement.

4.Compensation and Benefits. As compensation for all services rendered pursuant to this Agreement. the Company shall provide to the Executive the following during the Term:

4.1 Base Salary. Effective January 1, 2024, the Company will pay to the Executive an annual base salary of Five Hundred and Fifteen Thousand Dollars ($515,000) payable in accordance with the customary payroll practices of the Company. The Base Salary shall be subject to adjustment from time to time, as determined by the Board or its designee in its sole discretion. For purposes of this Agreement, "Base Salary" shall mean Executive's base salary as adjusted.

4.2 Annual Bonus. For each fiscal year of the Company ("Fiscal Year") during the Term, the Executive shall be eligible to receive an annual variable bonus payment with a target gross amount of 100% of Base Salary (the "Annual Bonus"). The actual amount of the Annual Bonus payment, if any, shall be based on the operational performance of the Company and be subject to achievement of financial or other targets as set by the Board or its designee at the beginning of the Fiscal Year. If such targets are fully achieved, the Executive shall be entitled to 100% of the Annual Bonus. If the targets are under-achieved or over-achieved, the Annual Bonus shall be reduced or increased, as determined by, and in the sole discretion of, the Board or its designee. The formula for calculating the precise bonus payment shall be determined by the Board or any committee thereof designated by the Board for such purpose in consultation with the Executive. The Annual Bonus payment shall be due on the earlier of (i) thirty days after the approval by the Board or the consolidated financial statements of the Company and (ii) the date on which the Company pays annual bonuses to other members of senior management; provided that, in no event will an Annual Bonus be paid later than the 15th day of the third (3rd) month following the end of the calendar year in which such Fiscal Year ends.

4.3 Participation in Employee Benefit Plans. The Executive shall be entitled, if and to the extent eligible, to participate in all of the applicable benefit plans of the Company, which may be available to other senior executives of the Company. With respect his anticipated move to the Macon, Georgia area, the Executive will be entitled to the applicable Company standard relocation program. Further, the Executive will be paid a onetime cash payment of One Hundred Thousand Dollars ($100,000) to cover other moving expenses.

4.4 Expense Reimbursement. The Executive shall be entitled to receive reimbursement for all appropriate traveling and other business expenses incurred by him in connection with his duties under this Agreement in accordance with the policies of the Company as in effect from time to time. Further the Executive will be entitled to a Five thousand dollar ($5,000) monthly travel stipend to cover personal travel.

4.5 Participation in the Equity Plan. On or as soon as administratively practicable after the Effective Date, the executive, pursuant to the terms of the Company’s Amended and Restated 2015 Omnibus Equity Incentive Plan (as amended or updated from time to time, the “Equity Plan”) will be eligible to participate in the Company’s Equity Award Plan.

The Executive will be entitled to a Long-Term Incentive (LTI) target of 100% of current base salary with eligibility for additional awards appropriate for the Company's President position, as determined by the Board or its designee in its sole discretion. The Executive's participation in the Equity Plan and rights thereunder shall be subject to the terms of the Equity Plan, this Agreement and any applicable grant or other agreements under the Equity Plan as determined by the Board or its designee.

(a)In the event there is a Change in Control (as defined below) involving the Company during the period of such vesting scheduled and while the Executive remains employed by the Company, all remaining unvested Restricted Shares (“RSUs”) and Stock Options will full vest upon the Change in Control. For purposes of this Agreement, “Change in Control” means a change in control as such term is defined in the Equity Plan.

5.Termination of Employment.

5.1 By the Company for Cause or by the Executive. If: (i) the Company eliminates the Executive's employment with the Company for Cause (as defined below) or (ii) the Executive terminates his employment for any reason, provided that the Executive shall be required to give the Company at least Sixty (60) days prior written notice of any termination of employment, the Executive or the Executive's legal representatives (as appropriate), shall be entitled to receive the following:

(a)the Executive's accrued but unpaid Base Salary to the date of termination and any employee benefits the Executive may be entitled to pursuant to the employee benefit plans of the Company; and

(b)expenses reimbursable under Section 4.4 incurred but not yet reimbursed to the Executive to the date of termination.

5.2Termination by the Company Without Cause or if the Company Elects not to Extend the Term. If during the Term the Company terminates the Executive's employment without Cause (which may be done at any time without prior notice), or if the Company elects not to extend the Executive's employment beyond the expiration of the Term (including any extensions), the Executive shall receive the severance payments set forth in this Section 5.2 (in addition to the payments upon termination specified in Section 5.1) upon execution without revocation of a valid release agreement in a form reasonably acceptable to the Company:

(a) the unpaid portion of the Annual Bonus, if any, relating to the Fiscal Year prior to the Fiscal Year of the termination by the Company without Cause payable in accordance with Section 4.2;

(b) continued payment of the Executive's Base Salary, payable in accordance with the Company's payroll policy, for a period commencing on the date of termination and ending twelve (12) month anniversary of the date of termination; and

(c) reimbursement of the cost of continuation coverage of group health coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended ("COBRA'") for a maximum of twelve (12) months to the extent Executive elects such COBRA continuation coverage and is eligible and subject to tJ1e terms of the health plan and the law; provided, that such reimbursement shall cease to the extent that the Executive is eligible for health benefits from a new employer.

The Company shall have no obligation to provide the benefits set forth above in the event that Executive breaches the provisions of Section 6.

5.3Termination Without Cause Upon a Change in Control. If during the Term the Company terminates the Executive's employment without Cause at any time within six (6) months preceding or twelve (12) months following a Change in Control (as defined above in Section 4.5(a)), the Executive shall receive all payments and benefits described above in Section 5.2, except that with respect to continued payment of Base Salary described in 5.2(b), clause (ii) thereof shall read "the twenty-four (24) month anniversary of the date of termination," upon execution without revocation of a valid release agreement in a form reasonably acceptable to the Company. In lieu of this compensation, Executive shall be entitled to the benefits of any applicable Company Change-in-Control Severance plan that may be in effect at that time, if such plan is deemed more advantageous for Executive.

5.4Removal from any Boards and Position. If the Executive's employment is terminated for any reason under this Agreement, he shall be deemed to resign, effective as of the date of termination, (i) if a member, from the Board or board of directors of any subsidiary of the Company or any affiliate of the Company and its subsidiaries or any other board to which he has been appointed or nominated by or on behalf of the Company and (ii) from any position with the Company or any subsidiary of the Company or any affiliate of the Company and its subsidiaries, including, but not limited to, as an officer of the Company and any of its subsidiaries or the affiliates of the Company and their subsidiaries.

5.5Nondisparagement. The Executive agrees that he will not at any time (whether during or after the Term) publish or communicate to any person or entity any Disparaging (as defined

below) remarks, comments or statements concerning the Company, its parent, subsidiaries and affiliates, and their respective present and former members, partners, directors, officers, shareholders, employees, agents, attorneys, successors and assigns. "Disparaging" remarks, comments or statements are those that impugn the character, honesty, integrity or morality or business acumen or abilities in connection with any aspect of the operation of business of the individual or entity being disparaged.

1Restrictions and Obligations of the Executive.

5.2Confidentiality.

(a)During the course of the Executive's employment by the Company and service to the Company, the Executive will have access to certain trade secrets and confidential information relating to the Company, its directors, officers, members, shareholders, investors, affiliates, partners and any parents, subsidiaries or other affiliates of the Company (the "Protected Parties") which is not readily available from sources outside the Company. The confidential and proprietary information and in any material respect, trade secrets of the Protected Parties are among their most valuable assets, including but not limited to, their customer, supplier and vendor lists, databases, competitive strategies, computer programs, frameworks, or models, their marketing programs, their sales, financial, marketing, training and technical information, their product development (and proprietary product data) and any other information, whether communicated orally, electronically, in writing or in other tangible forms concerning how the Protected Parties create, develop, acquire or maintain their products and marketing plans, target their potential customers and operate their retail and other businesses. The Protected Parties invested, and continue to invest, considerable amounts of time and money in their process, technology, know-how, obtaining and developing the goodwill of their customers, their other external relationships, their data systems and data bases, and all the information described above (hereinafter collectively referred to as ''Confidential Information"), and any misappropriation or unauthorized disclosure of Confidential Information in any form would irreparably harm the Protected Parties. The Executive acknowledges that such Confidential information constitutes valuable, highly confidential, special and unique property of the Protected Parties. The Executive shall hold in a fiduciary capacity for the benefit or the Protected Parties all Confidential information relating to the Protected Parties and their businesses, which shall have been obtained by the Executive during the Executive's employment by the Company or its subsidiaries and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). Except as required by law or an order of a court or governmental agency with jurisdiction, the Executive shall not, during the period the Executive is employed by the Company or its subsidiaries or at any time thereafter, disclose any Confidential Information, directly or indirectly, to any person or entity for any reason or purpose whatsoever, nor shall the Executive use it in any way, except in the course of the Executive's employment with, and for the benefit of, the Protected Parties or to enforce any rights or defend any claims hereunder or under any other agreement to which the Executive is a party, provided that such disclosure is relevant to the enforcement of such rights or defense of such claims and is only disclosed in the formal proceedings related thereto. The Executive shall take all reasonable steps to safeguard the Confidential Information and to protect it against disclose, misuse, espionage, loss and theft. The Executive understands and agrees that the Executive shall acquire no rights to any such Confidential Information.

5.1No-Solicitation or Hire. During the Term, any extended employment period thereafter and for a period of twenty-four (24) months following the termination of the Executive's employment for any reason, the Executive: (a) shall not directly or indirectly solicit or attempt to solicit or induce, directly or indirectly, any party who is a customer of the Company, or who was a customer of the Company or its subsidiaries at any time during the twelve (12) month period immediately prior to the date the Executive’s employment terminates, for the purpose of marketing, selling or providing to any such party ay services or products offered by or available from the Company or its subsidiaries (provided that if the Executive intends to solicit any such party for any other purpose, he shall notify the Company of such intention and receive prior written approval from the Company), (b) shall not directly or indirectly solicit or attempt to solicit or induce, directly or indirectly, any supplier to Company or any subsidiary to terminate, reduce or alter negatively its relationship with the Company or any subsidiary or in any manner interfere with any agreement or contract between the Company or any subsidiary and such supplier or (c)

shall not, either directly, or on behalf of any other person or any entity in competition with the Business of the Company or any of its subsidiaries, hire, offer employment to, or otherwise directly, or indirectly, solicit or attempt to solicit or induce, directly or indirectly the employment of any employee of the Company or any of its subsidiaries or any person who was an employee of the Company or any of its subsidiaries during the twelve (12) month period immediately prior to the date the Executive's employment terminates to terminate such employee's employment relationship with the Protected Parties.

5.2Non-Competition. During the Term, any extended employment period thereafter and for a period of twenty-four (24) months following the termination of Executive's employment by the Company (for any reason), the Executive shall not, whether individually, as a director, manager, member, stockholder, partner, owner, employee, consultant or agent of any business, or in any other capacity, other than on behalf of the Company or a subsidiary, organize, establish, own, operate, manage, control, engage in, participate in, invests in, permit his name to be used by, act as a consultant or advisor to, render services for (alone or in association with any person, firm, corporation or business organization), or otherwise assist any person or entity that engages in or owns, invests in, operates, manages or controls any venture or enterprise which engages or proposes to engage in any business conducted by the Company or any of its subsidiaries on the date of the Executive's termination of employment or within twelve (12) months of the Executive's termination of employment in the United States (the "Business"). Notwithstanding the foregoing, nothing in this Agreement shall prevent the Executive from owning for passive investment purposes not intended to circumvent this Agreement, less than five percent (5%) of the publicly traded common equity securities of any company engaged in the Business (so long as the Executive has no power to manage, operate, advise, consult with or control the competing enterprise and no power, alone or in conjunction with other affiliated parties, to select a director, manage, general partner, or similar governing official of the competing enterprise other than in connection with the normal and customary voting powers afforded the Executive in connection with any permissible equity ownership).

against the Executive or the entry of any other court order against the Executive prohibiting and enjoining him from violating, or directing him to comply with any provision of Section 5.4 and Section 6. The Executive also agrees that such remedies shall be in addition to any and all remedies, including damages, available to the Protected Parties against him for such breaches or threatened or attempted breaches. In addition, without limiting the Protected Parties' remedies for any breach of any restriction on the Executive set forth in Section 5.5 and Section 6, except as required by law, the Executive shall not be entitled to any payments set forth in Section 5.2 hereof if the Executive has breached the covenants applicable to the Executive contained in Section 5.5 or Section 6, the Executive will immediately return to the Protected Parties any such payments previously received under Section 5.2 and Section 5.3 upon such a breach, and in the event of such breach, the Protected Parties will have no obligation to pay any of the amounts that remain payable by the Company under Section 5.2 or Section 5.3.

2Indemnification. The Company agrees, to the extent permitted by applicable law and its organizational documents, to indemnify, defend and hold harmless the Executive from and against any and all losses, suits, actions, causes of action, judgments, damages, liabilities, penalties, fines, costs or claims of any kind or nature (''Indemnified Claim''), including reasonable legal fees and related costs incurred by Executive in connection with the preparation for or defense of any indemnified Claim, whether or not resulting in any liability, to which Executive may become subject or liable or which may be incurred by or assessed against Executive, relating to or arising out of his employment by the Company or the services to be performed pursuant to this Agreement, provided that the Company shall only defend, but not indemnify or hold Executive harmless, from and against an indemnified Claim in the event there is a final, non-appealable, determination that Executive's liability with respect to such indemnified Claim resulted from Executive's willful misconduct or gross negligence. The Company's obligations under this section shall be in addition to any other right, remedy or indemnification which Executive may have or be entitled to at common law or otherwise.

3Other Provisions.

9.2Notices. Any notice or other communication required or which may be given hereunder shall be in writing and shall be delivered personally, telegraphed, telexed, sent by facsimile transmission or sent by certified, registered or express mail, postage prepaid or overnight mail and shall be deemed given when so delivered personally, telegraphed, telexed, or sent by facsimile transmission or, if mailed, four (4) days after the date of mailing or one (1) day after overnight mail, as follows:

(a)If the Company, to:

Blue Bird Body Company

3920 Arkwright Road

Suite 200

Macon. GA 31210 Attention: Jolene O’Brien Paver Telephone: (478) 951-5754

Email: Jolene.Paver@Blue-Bird.com

(b) If the Executive, to the Executive's home address reflected in the Company’s records.

9.3Entire Agreement. This Agreement contains the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior agreements, written or oral, with respect thereto.

9.4Representations and Warranties by Executive. The Executive represents and warrants that he is not a party to or subject to any restrictive covenants, legal restrictions or other agreements in favor of any entity or person which would in any way preclude, inhibit, impair or limit the Executive's ability to perform his obligations under this Agreement, including, but not limited to, non-competition agreements, non solicitation agreements or confidentiality agreements.

9.5Waiver and Amendments. This Agreement may be amended, modified, superseded, canceled, renewed or extended, and the terms and conditions hereof may be waived, only by a written instrument signed by the Parties or, in the case of a waiver, by the patty waiving compliance. No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any right, power or privilege hereunder, nor any single or partial exercise of any right, power or privilege hereunder, preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

9.6Governing Law, Dispute Resolution and Venue.

(a)This Agreement shall be governed and construed in accordance with the laws of the State of Georgia, without regard to conflicts of laws principles.

5.1Section 409A

5.2.1The parties agree that this Agreement shall be interpreted to comply with or be exempt from Section 409A or the Internal Revenue Code or 1986, as amended, and the Treasury regulations and guidance promulgated thereunder (collectively "Code Section 409A"), and all provisions of this Agreement shall be construed in a manner consistent with the requirements for avoiding taxes or penalties under Code Section 409A. In no event whatsoever will the Company be liable for any additional tax, interest or penalties that may be imposed on the Executive under Code Section 409A or any damages for failing to comply with Code Section 409A.

5.2.2A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits considered "nonqualified deferred compensation" under Code Section 409A upon or following a termination of employment unless such termination is also a "separation from service" within the meaning of Code Section 409A and, for purposes or any such provision of this Agreement. references to a "termination,'' "termination of employment'' or like terms shall mean "separation from service." If the Executive is deemed on the date of termination to be a "specified employee" within the meaning of that term under Code Section 409A(a)(2)(B), then with regard 10 any payment or the provision or any benefit that is considered nonqualified deferred compensation under Code Section 409A payable on account of a '·separation from service," such payment or benefit shall be made or provided at the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of such "separation from service" of the Executive, and (ii) the date of the Executive's death (the "Delay Period''). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Subsection 11(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed on the first business day following the expiration of the Delay Period to the Executive in a lump sum and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.

5.2.3With regard to any provision herein that provides for reimbursement of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the right to reimbursement or in-kind benefits shall not be subject 10 liquidation or exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits, to be provided in any other taxable year, and (iii) such payments shall be made on or before the last day of the Executive's taxable year following the taxable year in which the expense occurred. For purposes of Code Section 409A. the Executive's right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g. ·'payment

shall be made within thirty (30) days following the date of termination"). the actual date of payment within the specified period shall be within the sole discretion of the Company.

5.2Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument.

9.8.1Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning of terms contained herein.

5.3Severability. If any term, provision, covenant or restriction of this Agreement, or any part thereof, is held by a court of competent jurisdiction or any foreign, federal, state, county or local government or any other governmental, regulatory or administrative agency or authority lo be invalid, void, unenforceable or against public policy for any reason, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected or impaired or invalidated. The Executive acknowledges that the restrictive covenants contained in Section 6 are a condition of this Agreement and arc reasonable and valid in temporal scope and in all other respects.

9.10 Judicial Modification. If any court determines that any of the covenants in Section 6, or any part of any of them, is invalid or unenforceable, the remainder of such covenants and parts thereof shall not thereby be affected and shall be given full effect, without regard to the invalid portion. If any court determines that any of such covenants, or any part thereof, is invalid or unenforceable because of the geographic or temporal scope of such provision. such court shall reduce such scope to the minimum extent necessary to make such covenants valid and enforceable.

9.11 Tax Withholding. The Company or other payor is authorized to withhold from any benefit provided or payment due hereunder, the amount of withholding taxes due any federal, state or local authority in respect of such benefit or payment and to take such other action as may be necessary in the opinion of the Board or its designee to satisfy all obligations for the payment of such withholding taxes.

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IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby, have executed this Agreement as of the day and year dated below.

Executive:

/s/ Britton Smith

Britton Smith

1/26/2024

Date

Blue Bird Body Company and Blue Bird Corporation

By: /s/ Phil Horlock

Name: Phil Horlock

Title: CEO

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (the ''Agreement"), executed as of the date of signature below, effective as of 1st day of October 2023, by and between Blue Bird Body Company, a Georgia corporation, and, Blue Bird Corporation, a Delaware corporation (collectively, the ''Company"), and Razvan Radulescu (the "Executive").

WHEREAS, the Company and the Executive (each a ''Party” and together the "Parties") wish to enter into this Agreement pursuant to which the Company will employ the Executive.

NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement, the Parties agree as follows:

1.Employment and Acceptance. The Company shall employ the Executive, and the Executive accepts such employment, subject to the terms of this Agreement, as of October 1, 2023 (the ''Effective Date”).

2.Term. Subject to earlier termination pursuant to Section 5 of this Agreement, this Agreement and the employment relationship hereunder shall continue from the Effective Date until the first (1st)

3.Duties and Title.

3.1 Title. The Company shall employ the Executive to render services as described herein to the Company on a fulltime basis. Commencing on the Effective Date, the Executive shall serve as Chief Financial Officer (“CFO”) of the Company and shall, unless otherwise detemined by the Board of Directors of the Company (the "Board") report to the Chief Executive Officer and support a smooth leadership transition to execute the Company’s strategy and subject to Board approval.

3.2 Authority and Responsibilities. As President, the Executive will have such authority and responsibilities and will perform such executive duties as may be assigned to him by the Chief Executive Officer, including without limitation performing services for affiliates of the Company and its subsidiaries. The Executive will devote substantially all of his full working time and attention to the performance of such duties and to the promotion of the business and interests of the Company. ln order to effectively carry out the duties set forth in this Agreement, and agrees to be physically present at the Macon, Georgia offices to the extent necessary to effectively fulfill his responsibilities under this Agreement.

4.Compensation and Benefits. As compensation for all services rendered pursuant to this Agreement. the Company shall provide to the Executive the following during the Term:

4.2 Annual Bonus. For each fiscal year of the Company ("Fiscal Year") during the Term, the Executive shall be eligible to receive an annual variable bonus payment with a target gross amount of 100% of Base Salary (the "Annual Bonus"). The actual amount of the Annual Bonus payment, if any, shall be based on the operational performance of the Company and be subject to achievement of financial or other targets as set by the Board or its designee at the beginning of the Fiscal Year. If such targets are fully achieved, the Executive shall be entitled to 100% of the Annual Bonus. If the targets are under-achieved or over-achieved, the Annual Bonus shall be reduced or increased, as determined by, and in the sole discretion of, the Board or its designee. The formula for calculating the precise bonus payment shall be determined by the Board or any committee thereof designated by the Board for such purpose in consultation with the Executive. The Annual Bonus payment shall be due on the earlier of (i) thirty days after the approval by the Board or the consolidated financial statements of the Company and (ii) the date on which the Company pays annual bonuses to other members of senior management; provided that, in no event will an Annual Bonus be paid later than the 15th day of the third (3rd) month following the end of the calendar year in which such Fiscal Year ends.

The Executive will be entitled to a Long-Term Incentive (LTI) target of 100% of current base salary with eligibility for additional awards appropriate for the Company's CFO position, as determined by the Board or its designee in its sole discretion. The Executive's participation in the Equity Plan and rights thereunder shall be subject to the terms of the Equity Plan, this Agreement and any applicable grant or other agreements under the Equity Plan as determined by the Board or its designee.

5.Termination of Employment.

5.1 By the Company for Cause or by the Executive. If: (i) the Company eliminates the Executive's employment with the Company for Cause (as defined below) or (ii) the Executive terminates his employment for any reason, provided that the Executive shall be required to give the Company at least Sixty (60) days prior written notice of any termination of employment, the Executive or the Executive's legal representatives (as appropriate), shall be entitled to receive the following:

(a)the Executive's accrued but unpaid Base Salary to the date of termination and any employee benefits the Executive may be entitled to pursuant to the employee benefit plans of the Company; and

(b)expenses reimbursable under Section 4.4 incurred but not yet reimbursed to the Executive to the date of termination.

(a) the unpaid portion of the Annual Bonus, if any, relating to the Fiscal Year prior to the Fiscal Year of the termination by the Company without Cause payable in accordance with Section 4.2;

(b) continued payment of the Executive's Base Salary, payable in accordance with the Company's payroll policy, for a period commencing on the date of termination and ending on the first to occur of: (I) the date that the Executive enters into any subsequent employment relationship compensated at materially the same level as Executive’s then current compensation or greater and (ii) the twelve (12) month anniversary of the date of termination; and

(c) reimbursement of the cost of continuation coverage of group health coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended ("COBRA'") for a maximum of twelve (12) months to the extent Executive elects such COBRA continuation coverage and is eligible and subject to the terms of the health plan and the law; provided, that such reimbursement shall cease to the extent that the Executive is eligible for health benefits from a new employer.

The Company shall have no obligation to provide the benefits set forth above in the event that Executive breaches the provisions of Section 6.

5.3Termination Without Cause Upon a Change in Control If during the Term the Company terminates the Executive's employment without Cause at any time within six (6) months preceding or twelve (12) months following a Change in Control (as defined above in Section 4.5(a)), the Executive shall receive all payments and benefits described above in Section 5.2, except that with respect to continued payment of Base Salary described in 5.2(b), clause (ii) thereof shall read "the twenty-four (24) month anniversary of the date of termination," upon execution without revocation of a valid release agreement in a form reasonably acceptable to the Company. In lieu of this compensation, Executive shall be entitled to the benefits of any applicable Company Change-in-Control Severance plan that may be in effect at that time, if such plan is deemed more advantageous for Executive.

The Company shall have no obligation to provide the benefits set forth above in the event that Executive breaches the provisions of Section 6.

with the Company or any subsidiary of the Company or any affiliate of the Company and its subsidiaries, including, but not limited to, as an officer of the Company and any of its subsidiaries or the affiliates of the Company and their subsidiaries.

5.5Nondisparagement. The Executive agrees that he will not at any time (whether during or after the Term) publish or communicate to any person or entity any Disparaging (as defined below) remarks, comments or statements concerning the Company, its parent, subsidiaries and affiliates, and their respective present and former members, partners, directors, officers, shareholders, employees, agents, attorneys, successors and assigns. "Disparaging" remarks, comments or statements are those that impugn the character, honesty, integrity or morality or business acumen or abilities in connection with any aspect of the operation of business of the individual or entity being disparaged.

1Restrictions and Obligations of the Executive.

5.2Confidentiality.

such disclosure is relevant to the enforcement of such rights or defense of such claims and is only disclosed in the formal proceedings related thereto. The Executive shall take all reasonable steps to safeguard the Confidential Information and to protect it against disclose, misuse, espionage, loss and theft. The Executive understands and agrees that the Executive shall acquire no rights to any such Confidential Information.

the Executive intends to solicit any such party for any other purpose, he shall notify the Company of such intention and receive prior written approval from the Company), (b) shall not directly or indirectly solicit or attempt to solicit or induce, directly or indirectly, any supplier to Company or any subsidiary to terminate, reduce or alter negatively its relationship with the Company or any subsidiary or in any manner interfere with any agreement or contract between the Company or any subsidiary and such supplier or (c) shall not, either directly, or on behalf of any other person or any entity in competition with the Business of the Company or any of its subsidiaries, hire, offer employment to, or otherwise directly, or indirectly, solicit or attempt to solicit or induce, directly or indirectly the employment of any employee of the Company or any of its subsidiaries or any person who was an employee of the Company or any of its subsidiaries during the twelve (12) month period immediately prior to the date the Executive's employment terminates to terminate such employee's employment relationship with the Protected Parties.

1Remedies; Specific Performance. The Parties acknowledge and agree that the Executive's breach or threatened breach of any of the restrictions set forth in Section 5.5 and Section 6 will result in irreparable and continuing damage to the Protected Parties for which there may be no adequate remedy at law and that the Protected Parties shall be entitled to equitable relief, including specific performance and injunctive relief as remedies for any such breach or threatened or attempted breach. The Executive hereby consents to the grant of an injunction (temporary or otherwise) against the Executive or the entry of any other court order against the Executive prohibiting and enjoining him from violating, or directing him to comply with any provision of Section 5.4 and Section 6. The Executive also agrees that such remedies shall be in addition to any and all remedies, including damages, available to the Protected Parties against him for such breaches or threatened or attempted breaches. In addition, without limiting the Protected Parties' remedies for any breach of any restriction on the Executive set forth in Section 5.5 and Section 6, except as required by law, the Executive shall not be entitled to any payments set forth in Section 5.2 hereof if the Executive has breached the covenants applicable to the Executive contained in Section 5.5 or Section 6, the Executive will immediately return to the Protected Parties any such payments previously received under Section 5.2 and Section 5.3 upon such a breach, and in the event of such breach, the Protected Parties will have no obligation to pay any of the amounts that remain payable by the Company under Section 5.2 or Section 5.3.

3Other Provisions.

(a)If the Company, to:

Blue Bird Body Company

3920 Arkwright Road

Suite 200

Macon. GA 31210 Attention: Jolene O’Brien Paver Telephone: (478) 951-5754

Email: Jolene.Paver@Blue-Bird.com

(b) If the Executive, to the Executive's home address reflected in the Company’s records.

9.6Governing Law, Dispute Resolution and Venue.

(a)This Agreement shall be governed and construed in accordance with the laws of the State of Georgia, without regard to conflicts of laws principles.

5.1Section 409A

shall be made within thirty (30) days following the date of termination"). the actual date of payment within the specified period shall be within the sole discretion of the Company.

5.6Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument.

9.8Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning of terms contained herein.

[Signature Page to Follow]

IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby, have executed this Agreement as of the day and year dated below.

Executive:

/s/ Razvan Radulescu

Razvan Radulescu

1/26/2024

Date

Blue Bird Body Company and Blue Bird Corporation

By: /s/ Phil Horlock

Name: Phil Horlock

Title: CEO

EMPLOYMENT AGREEMENT

WHEREAS, the Company and the Executive (each a ''Party” and together the "Parties") wish to enter into this Agreement pursuant to which the Company will employ the Executive.

NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement, the Parties agree as follows:

2.Term. Subject to earlier termination pursuant to Section 5 of this Agreement, this Agreement and the employment relationship hereunder shall continue from the Effective Date until the first (1st)

3.Duties and Title.

3.1 Title. The Company shall employ the Executive to render services as described herein to the Company on a fulltime basis. Commencing on the Effective Date, the Executive shall serve as SVP, General Counsel of the Company and shall, unless otherwise detemined by the Board of Directors of the Company (the "Board") report to the Chief Executive Officer and support a smooth leadership transition to execute the Company’s strategy and subject to Board approval.

3.2 Authority and Responsibilities. As SVP, General Counsel, the Executive will have such authority and responsibilities and will perform such executive duties as may be assigned to him by the Chief Executive Officer, including without limitation performing services for affiliates of the Company and its subsidiaries. The Executive will devote substantially all of his full working time and attention to the performance of such duties and to the promotion of the business and interests of the Company. ln order to effectively carry out the duties set forth in this Agreement, and agrees to be physically present at the Macon, Georgia offices to the extent necessary to effectively fulfill his responsibilities under this Agreement.

4.Compensation and Benefits. As compensation for all services rendered pursuant to this Agreement. the Company shall provide to the Executive the following during the Term:

4.1 Base Salary. Effective January 1, 2024, the Company will pay to the Executive an annual base salary of Three Hundred and Sixty Thousand Five Hundred Dollars ($360,500) payable in accordance with the customary payroll practices of the Company. The Base Salary shall be subject to adjustment from time to time, as determined by the Board or its designee in its sole discretion. For purposes of this Agreement, "Base Salary" shall mean Executive's base salary as adjusted.

4.2 Annual Bonus. For each fiscal year of the Company ("Fiscal Year") during the Term, the Executive shall be eligible to receive an annual variable bonus payment with a target gross amount of 50% of Base Salary (the "Annual Bonus"). The actual amount of the Annual Bonus payment, if any, shall be based on the operational performance of the Company and be subject to achievement of financial or other targets as set by the Board or its designee at the beginning of the Fiscal Year. If such targets are fully achieved, the Executive shall be entitled to 100% of the Annual Bonus. If the targets are under-achieved or over-achieved, the Annual Bonus shall be reduced or increased, as determined by, and in the sole discretion of, the Board or its designee. The formula for calculating the precise bonus payment shall be determined by the Board or any committee thereof designated by the Board for such purpose in consultation with the Executive. The Annual Bonus payment shall be due on the earlier of (i) thirty days after the approval by the Board or the consolidated financial statements of the Company and (ii) the date on which the Company pays annual bonuses to other members of senior management; provided that, in no event will an Annual Bonus be paid later than the 15th day of the third (3rd) month following the end of the calendar year in which such Fiscal Year ends.

The Executive will be entitled to a Long-Term Incentive (LTI) target of 50% of current base salary with eligibility for additional awards appropriate for the Company's SVP, General Counsel position, as determined by the Board or its designee in its sole discretion. The Executive's participation in the Equity Plan and rights thereunder shall be subject to the terms of the Equity Plan, this Agreement and any applicable grant or other agreements under the Equity Plan as determined by the Board or its designee.

5.Termination of Employment.

5.1 By the Company for Cause or by the Executive. If: (i) the Company eliminates the Executive's employment with the Company for Cause (as defined below) or (ii) the Executive terminates his employment for any reason, provided that the Executive shall be required to give the Company at least Sixty (60) days prior written notice of any termination of employment, the Executive or the Executive's legal representatives (as appropriate), shall be entitled to receive the following:

(a)the Executive's accrued but unpaid Base Salary to the date of termination and any employee benefits the Executive may be entitled to pursuant to the employee benefit plans of the Company; and

(b)expenses reimbursable under Section 4.4 incurred but not yet reimbursed to the Executive to the date of termination.

(a) the unpaid portion of the Annual Bonus, if any, relating to the Fiscal Year prior to the Fiscal Year of the termination by the Company without Cause payable in accordance with Section 4.2;

(c) reimbursement of the cost of continuation coverage of group health coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended ("COBRA'") for a maximum of twelve (12) months to the extent Executive elects such COBRA continuation coverage and is eligible and subject to the terms of the health plan and the law; provided, that such reimbursement shall cease to the extent that the Executive is eligible for health benefits from a new employer.

The Company shall have no obligation to provide the benefits set forth above in the event that Executive breaches the provisions of Section 6.

5.3Termination Without Cause Upon a Change in Control. Termination Without Cause Upon a Change in Control. If during the Term the Company terminates the Executive's employment without Cause at any time within six (6) months preceding or twelve (12) months following a Change in Control (as defined above in Section 4.5(a)), the Executive shall receive all payments and benefits described above in Section 5.2, except that with respect to continued payment of Base Salary described in 5.2(b), clause (ii) thereof shall read "the twenty-four (24) month anniversary of the date of termination," upon execution without revocation of a valid release agreement in a form reasonably acceptable to the Company. In lieu of this compensation, Executive shall be entitled to the benefits of any applicable Company Change-in-Control Severance plan that may be in effect at the time, if such plan is deemed more advantageous for Executive.

The Company shall have no obligation to provide the benefits set forth above in the event that Executive breaches the provisions of Section 6.

has been appointed or nominated by or on behalf of the Company and (ii) from any position with the Company or any subsidiary of the Company or any affiliate of the Company and its subsidiaries, including, but not limited to, as an officer of the Company and any of its subsidiaries or the affiliates of the Company and their subsidiaries.

1Restrictions and Obligations of the Executive.

5.2Confidentiality.

hereunder or under any other agreement to which the Executive is a party, provided that such disclosure is relevant to the enforcement of such rights or defense of such claims and is only disclosed in the formal proceedings related thereto. The Executive shall take all reasonable steps to safeguard the Confidential Information and to protect it against disclose, misuse, espionage, loss and theft. The Executive understands and agrees that the Executive shall acquire no rights to any such Confidential Information.

or products offered by or available from the Company or its subsidiaries (provided that if the Executive intends to solicit any such party for any other purpose, he shall notify the Company of such intention and receive prior written approval from the Company), (b) shall not directly or indirectly solicit or attempt to solicit or induce, directly or indirectly, any supplier to Company or any subsidiary to terminate, reduce or alter negatively its relationship with the Company or any subsidiary or in any manner interfere with any agreement or contract between the Company or any subsidiary and such supplier or (c) shall not, either directly, or on behalf of any other person or any entity in competition with the Business of the Company or any of its subsidiaries, hire, offer employment to, or otherwise directly, or indirectly, solicit or attempt to solicit or induce, directly or indirectly the employment of any employee of the Company or any of its subsidiaries or any person who was an employee of the Company or any of its subsidiaries during the twelve (12) month period immediately prior to the date the Executive's employment terminates to terminate such employee's employment relationship with the Protected Parties.

3Other Provisions.

(a)If the Company, to:

Blue Bird Corporation

3920 Arkwright Road

Suite 200

Macon. GA 31210 Attention: Jolene O’Brien Paver Telephone: (478) 951-5754

Email: Jolene.Paver@Blue-Bird.com

(b) If the Executive, to the Executive's home address reflected in the Company’s records.

9.6Governing Law, Dispute Resolution and Venue.

(a)This Agreement shall be governed and construed in accordance with the laws of the State of Georgia, without regard to conflicts of laws principles.

5.1Section 409A

shall be made within thirty (30) days following the date of termination"). the actual date of payment within the specified period shall be within the sole discretion of the Company.

5.6Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument.

5.8.1Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning of terms contained herein.

5.7Severability. If any term, provision, covenant or restriction of this Agreement, or any part thereof, is held by a court of competent jurisdiction or any foreign, federal, state, county or local government or any other governmental, regulatory or administrative agency or authority lo be invalid, void, unenforceable or against public policy for any reason, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected or impaired or invalidated. The Executive acknowledges that the restrictive covenants contained in Section 6 are a condition of this Agreement and arc reasonable and valid in temporal scope and in all other respects.

9.10 Judicial Modification. If any court determines that any of the covenants in Section 6, or any part of any of them, is invalid or unenforceable, the remainder of such covenants and parts thereof shall not thereby be affected and shall be given full effect, without regard to the invalid portion. If any court determines that any of such covenants, or any part thereof, is invalid or unenforceable because of the geographic or temporal scope of such provision. such court shall reduce such scope to the minimum extent necessary to make such covenants valid and enforceable.

9.11 Tax Withholding. The Company or other payor is authorized to withhold from any benefit provided or payment due hereunder, the amount of withholding taxes due any federal, state or local authority in respect of such benefit or payment and to take such other action as may be necessary in the opinion of the Board or its designee to satisfy all obligations for the payment of such withholding taxes.

[Signature Page to Follow]

IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby, have executed this Agreement as of the day and year dated below.

Executive:

/s/ Ted M Scartz

Ted Scartz

1/26/2024

Date

Blue Bird Body Company and Blue Bird Corporation

By: /s/ Phil Horlock

Name: Phil Horlock

Title: CEO

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECURITIES EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a)

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Philip Horlock, the Chief Executive Officer of Blue Bird Corporation (the “registrant”), certify that:

(1) I have reviewed this quarterly report on Form 10-Q of Blue Bird Corporation;

(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

(4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Dated:	May 8, 2024	/s/ Philip Horlock
		Philip Horlock
		Chief Executive Officer

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECURITIES EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a)

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Razvan Radulescu, the Chief Financial Officer of Blue Bird Corporation (the “registrant”), certify that:

(1) I have reviewed this quarterly report on Form 10-Q of Blue Bird Corporation;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Dated:	May 8, 2024	/s/ Razvan Radulescu
		Razvan Radulescu
		Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Blue Bird Corporation (the “Company”) on Form 10-Q for the quarterly period ended March 30, 2024, as filed with the United States Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Philip Horlock, Chief Executive Officer of the Company, and Razvan Radulescu, Chief Financial Officer of the Company, do hereby certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated:	May 8, 2024	/s/ Philip Horlock
		Philip Horlock
		Chief Executive Officer



Dated:	May 8, 2024	/s/ Razvan Radulescu
		Razvan Radulescu
		Chief Financial Officer

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Mar. 30, 2024	May 03, 2024
Document and Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 30, 2024
Document Transition Report	false
Entity File Number	001-36267
Entity Registrant Name	BLUE BIRD CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-3891989
Entity Address, Address Line One	3920 Arkwright Road
Entity Address, Address Line Two	2nd Floor
Entity Address, City or Town	Macon
Entity Address, State or Province	GA
Entity Address, Postal Zip Code	31210
City Area Code	478
Local Phone Number	822-2801
Title of 12(b) Security	Common stock, $0.0001 par value
Trading Symbol	BLBD
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		32,299,065
Entity Central Index Key	0001589526
Current Fiscal Year End Date	--09-28
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Amendment Flag	false

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 30, 2024	Sep. 30, 2023
Current assets
Cash and cash equivalents	$ 93,096	$ 78,988
Accounts receivable, net	11,425	12,574
Inventories	145,401	135,286
Other current assets	19,495	9,215
Total current assets	269,417	236,063
Restricted cash	0
Property, plant and equipment, net	94,487	95,101
Goodwill	18,825	18,825
Intangible assets, net	44,489	45,424
Equity investment in affiliate	25,948	17,619
Deferred tax assets	0	2,182
Finance lease right-of-use assets	683	1,034
Other assets	2,633	1,518
Total assets	456,482	417,766
Current liabilities
Accounts payable	138,847	137,140
Warranty	6,779	6,711
Accrued expenses	37,549	32,894
Deferred warranty income	8,721	8,101
Finance lease obligations	898	583
Other current liabilities	21,973	24,391
Current portion of long-term debt	5,000	19,800
Total current liabilities	219,767	229,620
Long-term liabilities
Revolving credit facility	0	0
Long-term debt	92,322	110,544
Warranty	8,697	8,723
Deferred warranty income	16,842	15,022
Deferred tax liabilities	2,238	2,513
Finance lease obligations	380	987
Other liabilities	8,317	7,955
Pension	2,131	2,404
Total long-term liabilities	130,927	148,148
Guarantees, commitments and contingencies (Note 6)
Stockholders' equity
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 0 shares outstanding at March 30, 2024 and September 30, 2023	0	0
Common stock, $0.0001 par value, 100,000,000 shares authorized, 32,299,065 and 32,165,225 shares outstanding at March 30, 2024 and September 30, 2023, respectively	3	3
Additional paid-in capital	191,216	177,861
Accumulated deficit	(3,527)	(55,700)
Accumulated other comprehensive loss	(31,622)	(31,884)
Treasury stock, at cost, 1,782,568 shares at March 30, 2024 and September 30, 2023	(50,282)	(50,282)
Total stockholders' equity	105,788	39,998
Total liabilities and stockholders' equity	$ 456,482	$ 417,766

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 30, 2024	Sep. 30, 2023
Statement of Financial Position [Abstract]
Preferred Stock, Par Value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred Stock, Shares Authorized	10,000,000	10,000,000
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par Value (in dollars per share)	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	100,000,000	100,000,000
Common Stock, Shares Outstanding	32,299,065	32,165,225
Treasury Stock, Common, Shares	1,782,568	1,782,568

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Income Statement [Abstract]
Net sales	$ 345,915	$ 299,814	$ 663,575	$ 535,546
Cost of goods sold	282,276	264,165	536,378	492,440
Gross profit	63,639	35,649	127,197	43,106
Operating expenses
Selling, general and administrative expenses	27,571	23,205	53,173	40,037
Operating profit	36,068	12,444	74,024	3,069
Interest expense	(2,812)	(5,192)	(6,443)	(9,388)
Interest income	1,054	12	2,142	12
Other expense, net	(1,968)	(342)	(3,189)	(578)
Loss on debt refinancing or modification	0	0	(1,558)	(537)
Income (loss) before income taxes	32,342	6,922	64,976	(7,422)
Income tax (expense) benefit	(8,261)	(1,389)	(16,707)	1,592
Equity in net income of non-consolidated affiliate	1,942	1,597	3,904	1,666
Net income (loss)	$ 26,023	$ 7,130	$ 52,173	$ (4,164)
Earnings (loss) per share:
Basic weighted average shares outstanding	32,240,458	32,033,709	32,205,657	32,029,999
Diluted weighted average shares outstanding	33,074,592	32,322,163	32,828,339	32,029,999
Basic earnings per share (in dollars per share)	$ 0.81	$ 0.22	$ 1.62	$ (0.13)
Diluted earnings per share (in dollars per share)	$ 0.79	$ 0.22	$ 1.59	$ (0.13)

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 26,023	$ 7,130	$ 52,173	$ (4,164)
Other comprehensive income, net of tax:
Net change in defined benefit pension plan	131	227	262	454
Total other comprehensive income	131	227	262	454
Comprehensive income (loss)	$ 26,154	$ 7,357	$ 52,435	$ (3,710)

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023
Cash flows from operating activities
Net income (loss)	$ 52,173	$ (4,164)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization expense	7,255	7,068
Non-cash interest expense	219	777
Share-based compensation expense	4,543	1,288
Equity in net income of non-consolidated affiliate	(3,904)	(1,666)
Dividend from equity investment in affiliate	2,991	0
Loss on disposal of fixed assets	25	11
Deferred income tax expense (benefit)	1,825	(1,600)
Amortization of deferred actuarial pension losses	344	598
Loss on debt refinancing or modification	1,558	537
Changes in assets and liabilities:
Accounts receivable	1,149	(1,101)
Inventories	(10,115)	13,816
Other assets	(10,016)	(2,380)
Accounts payable	2,298	28,116
Accrued expenses, pension and other liabilities	4,426	3,416
Total adjustments	2,598	48,880
Total cash provided by operating activities	54,771	44,716
Cash flows from investing activities
Cash paid for fixed assets	(5,643)	(3,740)
Proceeds from sale of fixed assets	0	0
Total cash used in investing activities	(5,643)	(3,740)
Cash flows from financing activities
Revolving credit facility borrowings (Note 4)	36,220	35,000
Revolving credit facility repayments	(36,220)	(55,000)
Term loan borrowings - new credit agreement (Note 4)	100,000	0
Term loan repayments (Note 4)	(133,050)	(9,900)
Principal payments on finance leases	(292)	(281)
Cash paid for debt costs (Note 4)	(3,128)	(3,272)
Repurchase of common stock in connection with stock award exercises	(301)	(57)
Cash received from stock option exercises	1,751	66
Total cash used in financing activities	(35,020)	(33,444)
Change in cash, cash equivalents, and restricted cash	14,108	7,532
Cash, cash equivalents, and restricted cash at beginning of period	78,988	10,479
Cash, cash equivalents, and restricted cash at end of period	93,096	18,011
Supplemental disclosures of cash flow information
Interest paid, net of interest received	3,678	8,125
Income tax paid (received), net of tax refunds	9,443	(52)
Non-cash investing and financing activities:
Changes in accounts payable for capital additions to property, plant and equipment	780	1,019
Right-of-use assets obtained in exchange for operating lease obligations	1,241	199
Warrants issued for equity investment in affiliate	$ 7,416	$ 0

Consolidated Statement of Stockholders' Deficit Statement - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In-Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Treasury Stock
Beginning Balance (in shares) at Sep. 30, 2022		32,024,911				1,782,568
Beginning Balance at Sep. 30, 2022	$ 1,382	$ 3	$ 173,103	$ (41,930)	$ (79,512)	$ (50,282)
Restricted stock activity (in shares)		7,156
Restricted stock activity	(57)		(57)
Stock option activity (in shares)		4,082
Stock option activity	66		66
Share-based compensation expense	1,201		1,201
Net income (loss)	(4,164)				(4,164)
Other comprehensive income, net of tax	454			454
Ending Balance (in shares) at Apr. 01, 2023		32,036,149				1,782,568
Ending Balance at Apr. 01, 2023	(1,118)	$ 3	174,313	(41,476)	(83,676)	$ (50,282)
Beginning Balance (in shares) at Dec. 31, 2022		32,032,067				1,782,568
Beginning Balance at Dec. 31, 2022	(9,196)	$ 3	173,592	(41,703)	(90,806)	$ (50,282)
Stock option activity (in shares)		4,082
Stock option activity	66		66
Share-based compensation expense	655		655
Net income (loss)	7,130				7,130
Other comprehensive income, net of tax	227
Other comprehensive income, net of tax	227			227
Ending Balance (in shares) at Apr. 01, 2023		32,036,149				1,782,568
Ending Balance at Apr. 01, 2023	(1,118)	$ 3	174,313	(41,476)	(83,676)	$ (50,282)
Beginning Balance (in shares) at Sep. 30, 2023		32,165,225				1,782,568
Beginning Balance at Sep. 30, 2023	39,998	$ 3	177,861	(31,884)	(55,700)	$ (50,282)
Private placement stock issuance costs	7,416		7,416
Restricted stock activity (in shares)		22,115
Restricted stock activity	(301)		(301)
Stock option activity (in shares)		111,725
Stock option activity	1,751		1,751
Share-based compensation expense	4,489		4,489
Net income (loss)	52,173				52,173
Other comprehensive income, net of tax	262			262
Ending Balance (in shares) at Mar. 30, 2024		32,299,065				1,782,568
Ending Balance at Mar. 30, 2024	105,788	$ 3	191,216	(31,622)	(3,527)	$ (50,282)
Beginning Balance (in shares) at Dec. 30, 2023		32,198,592				1,782,568
Beginning Balance at Dec. 30, 2023	75,577	$ 3	187,159	(31,753)	(29,550)	$ (50,282)
Stock option activity (in shares)		100,473
Stock option activity	1,602		1,602
Share-based compensation expense	2,455		2,455
Net income (loss)	26,023				26,023
Other comprehensive income, net of tax	131			131
Ending Balance (in shares) at Mar. 30, 2024		32,299,065				1,782,568
Ending Balance at Mar. 30, 2024	$ 105,788	$ 3	$ 191,216	$ (31,622)	$ (3,527)	$ (50,282)

Nature of Business and Basis of Presentation	6 Months Ended
Nature of Business and Basis of Presentation	Mar. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Business and Basis of Presentation	1. Nature of Business and Basis of Presentation Nature of Business Blue Bird Body Company ("BBBC"), a wholly-owned subsidiary of Blue Bird Corporation, was incorporated in 1958 and has manufactured, assembled and sold school buses to a variety of municipal, federal and commercial customers since 1927. The majority of BBBC’s sales are made to an independent dealer network, which in turn sells buses to ultimate end users. References in these notes to condensed consolidated financial statements to “Blue Bird,” the “Company,” “we,” “our,” or “us” relate to Blue Bird Corporation and its wholly-owned subsidiaries, unless the context specifically indicates otherwise. We are headquartered in Macon, Georgia. Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company transactions and accounts have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting and Article 10 of Regulation S-X. The Company’s fiscal year ends on the Saturday closest to September 30 with its quarters consisting of thirteen weeks in most years. The fiscal years ending September 28, 2024 ("fiscal 2024") and ended September 30, 2023 ("fiscal 2023") consist or consisted of 52 weeks. The second quarters of fiscal 2024 and fiscal 2023 both included 13 weeks. The six month periods in fiscal 2024 and 2023 both included 26 weeks. In the opinion of management, all adjustments considered necessary for a fair presentation of financial results have been made. Such adjustments consist of only those of a normal recurring nature. Operating results for any interim period are not necessarily indicative of the results that may be expected for the entire year. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The Condensed Consolidated Balance Sheet data as of September 30, 2023 was derived from the Company’s audited financial statements but does not include all disclosures required by U.S. GAAP. For additional information, including the Company’s significant accounting policies, refer to the consolidated financial statements and related footnotes as of and for the fiscal year ended September 30, 2023 as set forth in the Company's fiscal 2023 Form 10-K filed with the Securities and Exchange Commission ("SEC") on December 11, 2023. Impacts of COVID-19 and Subsequent Supply Chain Constraints on our Business As discussed in detail in the fiscal 2023 Form 10-K filed with the SEC on December 11, 2023, the novel coronavirus known as "COVID-19" materially affected demand for new buses and replacement/maintenance parts during the second half of our fiscal year that ended October 3, 2020 ("fiscal 2020") and first half of our fiscal year that ended October 2, 2021 ("fiscal 2021"), significantly impacting our business and operations. Although demand for school buses strengthened substantially during the second half of fiscal 2021, the Company, and automotive industry as a whole, began experiencing significant supply chain constraints around this same period of time. These supply chain disruptions had a significant adverse impact on our operations and results during the second half of fiscal 2021 and all of fiscal 2022 due to higher purchasing costs, including freight costs incurred to expedite receipt of critical components, increased manufacturing inefficiencies and our inability to complete the production of buses to fulfill sales orders. Additionally, Russian military forces launched a large-scale invasion of Ukraine on February 24, 2022, which further exacerbated global supply chain disruptions. While the Company has no assets or customers in either of these countries, this military conflict has significantly impacted our financial results, primarily in an indirect manner since the Company does not sell to customers located in, or source goods directly from, either country. Specifically, it contributed to increased a) costs charged by suppliers for the purchase of inventory that is at least partially dependent on resources originating from either of the countries and b) freight costs, both of which negatively impacted the gross profit recognized on sales during fiscal 2022, fiscal 2023 and continuing into fiscal 2024. Towards the end of fiscal 2022 and continuing into fiscal 2023, there were slight improvements in the supply chain's ability to deliver the parts and components necessary to support our production operations, resulting in increased (i) manufacturing efficiencies and (ii) production of buses to fulfill sales orders during fiscal 2023. However, the higher costs charged by suppliers to procure inventory that continued into fiscal 2023 had a significant adverse impact on our operations and results. Specifically, such cost increases outpaced the increases in sales prices that we charged for the buses that were sold during the first quarter of fiscal 2023, many of which were included in the backlog of fixed price sales orders originating in fiscal 2021 and the early months of fiscal 2022 that carried forward into fiscal 2023. During the remainder of fiscal 2023, the buses that were sold were generally included in the backlog of fixed price sales orders originating more recently (i.e., the latter months of fiscal 2022 and in fiscal 2023), with the cumulative increases in sales prices we charged for those buses generally outpacing the higher costs we paid to procure inventory, resulting in gross profit during the quarters. While the gross margin on bus sales during the second quarter of fiscal 2023 lagged the historical gross margin reported prior to the COVID-19 pandemic, it returned to more normal historical levels during the latter half of fiscal 2023. Supply chain disruptions continued into the first half of fiscal 2024 as there were still occasional shortages of certain critical components as well as ongoing increases in raw materials costs, both of which impacted our business and operations by limiting the number of school buses that we could produce and sell as well as increasing the costs to manufacture buses. Nonetheless, the lessons learned, and resulting actions taken, by management over the past three fiscal years allowed the Company to better navigate these supply chain challenges and consistently produce buses to fulfill sales orders. Ongoing improvements in manufacturing operations, when coupled with periodic pricing actions taken by the Company to ensure that the increased sales prices charged for buses kept pace with increased costs to procure inventory to produce the buses, allowed the Company to report gross profit and gross margin during the first half of fiscal 2024 that were consistent with, or better than, historic levels experienced prior to the COVID-19 pandemic. Use of Estimates and Assumptions The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions. At the date of the financial statements, these estimates and assumptions affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities, and during the reporting period, these estimates and assumptions affect the reported amounts of revenues and expenses. For example, significant management judgments are required in determining excess, obsolete, or unsalable inventory; the allowance for doubtful accounts; potential impairment of long-lived assets, goodwill and intangible assets; and the accounting for self-insurance reserves, warranty reserves, pension obligations, income taxes, environmental liabilities and contingencies. Future events, including the extent and duration of continued supply chain constraints and their related economic impacts, and their effects cannot be predicted with certainty, and, accordingly, the Company’s accounting estimates require the exercise of judgment. The accounting estimates used in the preparation of the Company’s condensed consolidated financial statements may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. The Company evaluates and updates its assumptions and estimates on an ongoing basis and may employ outside experts to assist in the Company’s evaluations. Actual results could differ from the estimates that the Company has used.

Summary of Significant Accounting Policies and Recently Issued Accounting Standards	6 Months Ended
	Mar. 30, 2024
Accounting Policies [Abstract]
Summary of Significant Accounting Policies and Recently Issued Accounting Standards	2. Summary of Significant Accounting Policies and Recently Issued Accounting Standards The Company’s significant accounting policies are described in the Company’s fiscal 2023 Form 10-K, filed with the SEC on December 11, 2023. Our senior management has reviewed these significant accounting policies and related disclosures and determined that there were no significant changes in our critical accounting policies in the six months ended March 30, 2024. Recently Issued Accounting Standards ASU 2023-07 On November 27, 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments’ significant expenses on an interim and annual basis. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024, with early adoption permitted. ASU 2023-09 On December 14, 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires entities to disclose more detailed information in their reconciliation of their statutory tax rate to their effective tax rate. Public business entities ("PBEs") are required to provide this incremental detail in a numerical, tabular format. The ASU also requires entities to disclose more detailed information about income taxes paid, including by jurisdiction; pretax income (or loss) from continuing operations; and income tax expense (or benefit). The ASU is effective for PBEs in fiscal years beginning after December 15, 2024, and interim periods beginning after December 15, 2025, with early adoption permitted. The new ASUs will not impact amounts recorded in the financial statements but instead, will require more detailed disclosures in the footnotes to the financial statement. The Company plans to provide the updated disclosures required by the ASUs in the periods in which they are effective.

Supplemental Financial Information

6 Months Ended

Mar. 30, 2024

Condensed Financial Information [Abstract]

Supplemental Financial Information

3. Supplemental Financial Information

Inventories

The following table presents the components of inventories at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Raw materials	$	99,019	$	88,116
Work in process	36,982		45,875
Finished goods	9,400		1,295
Total inventories	$	145,401	$	135,286

Restricted Cash


(in thousands of dollars)	March 30, 2024		April 1, 2023
Cash and cash equivalents	$	93,096	$	17,773
Restricted cash	—		238
Total cash, cash equivalents, and restricted cash reported on the Condensed Consolidated Statements of Cash Flows	$	93,096	$	18,011

Product Warranties

The following table reflects activity in accrued warranty cost (current and long-term portions combined) for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Balance at beginning of period	$	15,283	$	15,580	$	15,434	$	15,970
Add current period accruals	2,512		2,432		4,853		4,465
Current period reductions of accrual	(2,319)		(2,458)		(4,811)		(4,881)
Balance at end of period	$	15,476	$	15,554	$	15,476	$	15,554

Extended Warranties

The following table reflects activity in deferred warranty income (current and long-term portions combined), for the sale of extended warranties of two to five years, for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Balance at beginning of period	$	24,118	$	19,290	$	23,123	$	18,795
Add current period deferred income	3,562		2,756		6,560		5,092
Current period recognition of income	(2,117)		(1,965)		(4,120)		(3,806)
Balance at end of period	$	25,563	$	20,081	$	25,563	$	20,081

Self-Insurance

The following table reflects our total accrued self-insurance liability, comprised of workers' compensation and health insurance related claims, at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Current portion	$	5,247	$	4,475
Long-term portion	2,348		1,771
Total accrued self-insurance	$	7,595	$	6,246

The current and long-term portions of the accrued self-insurance liability are reflected in accrued expenses and other liabilities, respectively, on the Condensed Consolidated Balance Sheets.

Shipping and Handling Revenues

Pension Expense

Components of net periodic pension benefit expense were as follows for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Interest cost	$	1,484	$	1,509	$	2,968	$	3,018
Expected return on plan assets	(1,620)		(1,630)		(3,240)		(3,260)
Amortization of prior loss	172		299		344		598
Net periodic pension benefit expense	$	36	$	178	$	72	$	356
Amortization of prior loss, recognized in other comprehensive income	(172)		(299)		(344)		(598)
Total recognized in net periodic pension benefit expense and other comprehensive income	$	(136)	$	(121)	$	(272)	$	(242)

Debt

6 Months Ended

Mar. 30, 2024

Debt Disclosure [Abstract]

Debt

4. Debt


Level	TNLR	ABR Loans	SOFR Loans
I	Less than 1.00x	0.75%	1.75%
II	Greater than or equal to 1.00x and less than 1.50x	1.50%	2.50%
III	Greater than or equal to 1.50x and less than 2.25x	2.00%	3.00%
IV	Greater than or equal to 2.25x	2.25%	3.25%

Term loan borrowings consisted of the following at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Term loan borrowings, net of deferred financing costs of $1,428 and $1,456, respectively	$	97,322	$	130,344
Less: current portion of long-term debt	5,000		19,800
Long-term debt, net of current portion	$	92,322	$	110,544

the fair value hierarchy. At March 30, 2024 and September 30, 2023, $98.8 million and $131.8 million, respectively, were outstanding on the term loans.

The schedule of remaining principal payments through maturity for the term loans is as follows:


(in thousands of dollars)
Fiscal Year	Principal Payments
2024	$	2,500
2025	5,000
2026	5,000
2027	5,000
2028	5,000
Thereafter	76,250
Total remaining principal payments	$	98,750

Income Taxes	6 Months Ended
Income Taxes	Mar. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	5. Income Taxes Income tax provisions for interim periods are based on estimated annual income tax rates, adjusted to reflect the effects of any significant infrequent or unusual items that are required to be discretely recognized within the current interim period. The effective tax rates in the periods presented are largely based upon the annual forecasted pre-tax earnings mix and allocation of certain expenses in various taxing jurisdictions where the Company conducts its business, primarily in the United States of America ("U.S."). In periods where our pre-tax income approximates or is equal to break-even, the effective tax rates for quarter-to-date and full-year periods may not be meaningful due to discrete period items. Three Months The effective tax rate for the three months ended March 30, 2024 was 25.5% and differed from the statutory federal income tax rate of 21%. The increase was primarily due to the impacts from state taxes and certain permanent items on the federal rate, which were partially offset by the impacts from federal and state tax credits (net of valuation allowances) and discrete period items during the quarter. The effective tax rate for the three months ended April 1, 2023 was 20.1%, which aligned with the statutory federal income tax rate of 21% and is comprised of normal tax rate items, including impacts from state taxes and federal and state tax credits (net of valuation allowances), with discrete period items having a nominal impact on the effective rate during the quarter. Six Months The effective tax rate for the six months ended March 30, 2024 was 25.7% and differed from the statutory federal income tax rate of 21%. The increase was primarily due to the impacts from state taxes and certain permanent items on the federal rate, which were partially offset by the impacts from federal and state tax credits (net of valuation allowances) and discrete period items during the period. The effective tax rate for the six months ended April 1, 2023 was 21.4%, which aligned with the statutory federal income tax rate of 21% and is comprised of normal tax rate items, including impacts from state taxes and federal and state tax credits (net of valuation allowances), with discrete period items having a nominal impact on the effective rate during the period.

Guarantees, Commitments and Contingencies	6 Months Ended
Guarantees, Commitments and Contingencies	Mar. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
Guarantees, Commitments and Contingencies	6. Guarantees, Commitments and Contingencies Litigation At March 30, 2024, the Company had a number of product liability and other cases pending. Management believes that, considering the Company’s insurance coverage and its intention to vigorously defend its positions, the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial statements. Environmental The Company is subject to a variety of environmental regulations relating to the use, storage, discharge and disposal of hazardous materials used in its manufacturing processes. Failure by the Company to comply with present and future regulations could subject it to future liabilities. In addition, such regulations could require the Company to acquire costly equipment or to incur other significant expenses to comply with environmental regulations. The Company is currently not involved in any material environmental proceedings and therefore, management believes that the resolution of pending environmental matters will not have a material adverse effect on the Company’s financial statements.

Segment Information

6 Months Ended

Mar. 30, 2024

Segment Reporting [Abstract]

Segment Information

7. Segment Information


Net sales
	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Bus (1)	$	317,959	$	273,472	$	611,396	$	486,721
Parts (1)	27,956		26,342		52,179		48,825
Segment net sales	$	345,915	$	299,814	$	663,575	$	535,546


Gross profit (loss)
	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Bus	$	49,589	$	23,099	$	100,883	$	19,368
Parts	14,050		12,550		26,314		23,738
Segment gross profit	$	63,639	$	35,649	$	127,197	$	43,106

The following table is a reconciliation of segment gross profit to consolidated income (loss) before income taxes for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Segment gross profit	$	63,639	$	35,649	$	127,197	$	43,106
Adjustments:
Selling, general and administrative expenses	(27,571)		(23,205)		(53,173)		(40,037)
Interest expense	(2,812)		(5,192)		(6,443)		(9,388)
Interest income	1,054		12		2,142		12
Other expense, net	(1,968)		(342)		(3,189)		(578)
Loss on debt refinancing or modification	—		—		(1,558)		(537)
Income (loss) before income taxes	$	32,342	$	6,922	$	64,976	$	(7,422)

Sales are attributable to geographic areas based on customer location and were as follows for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
U.S.	$	316,583	$	264,281	$	619,115	$	468,822
Canada	29,058		32,234		44,177		62,755
Rest of world	274		3,299		283		3,969
Total net sales	$	345,915	$	299,814	$	663,575	$	535,546

Revenue

6 Months Ended

Mar. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer

8. Revenue

The following table disaggregates revenue by product category for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Diesel buses	$	123,444	$	89,795	$	208,442	$	161,289
Alternative power buses (1)	180,162		171,269		375,491		303,215
Other (2)	14,991		13,040		28,688		23,495


Parts	27,318		25,710		50,954		47,547
Net sales	$	345,915	$	299,814	$	663,575	$	535,546

(1) Includes buses sold with any power source other than diesel (e.g., gasoline, propane, compressed natural gas ("CNG") or electric).

(2) Includes shipping and handling revenue, extended warranty income, surcharges and chassis and bus shell sales.

Earnings Per Share

6 Months Ended

Mar. 30, 2024

Earnings Per Share [Abstract]

Earnings Per Share

9. Earnings (Loss) Per Share

The following table presents the earnings (loss) per share computation for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands except for share data)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Numerator:
Net income (loss)	$	26,023	$	7,130	$	52,173	$	(4,164)

Denominator:
Weighted-average common shares outstanding	32,240,458		32,033,709		32,205,657		32,029,999
Weighted-average dilutive securities, restricted stock	390,498		270,156		283,078		—
Weighted-average dilutive securities, stock options	183,538		18,298		153,044		—
Weighted-average dilutive securities, warrants (Note 12)	260,098		—		186,560		—

Weighted-average shares and dilutive potential common shares (1)	33,074,592		32,322,163		32,828,339		32,029,999

Earnings (loss) per share:
Basic earnings (loss) per share	$	0.81	$	0.22	$	1.62	$	(0.13)
Diluted earnings (loss) per share	$	0.79	$	0.22	$	1.59	$	(0.13)

Accumulated Other Comprehensive Loss

6 Months Ended

Mar. 30, 2024

Equity [Abstract]

Accumulated Other Comprehensive Loss

10. Accumulated Other Comprehensive Loss

The following table provides information on changes in accumulated other comprehensive loss ("AOCL") for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	Defined Benefit Pension Plan		Total AOCL			Defined Benefit Pension Plan		Total AOCL
March 30, 2024
Beginning Balance	$	(31,753)	$	(31,753)		$	(31,884)	$	(31,884)

Amounts reclassified and included in earnings	172		172			344		344
Total before taxes	172		172			344		344
Income taxes	(41)		(41)			(82)		(82)
Ending Balance March 30, 2024	$	(31,622)	$	(31,622)		$	(31,622)	$	(31,622)

April 1, 2023
Beginning Balance	$	(41,703)	$	(41,703)		$	(41,930)	$	(41,930)

Amounts reclassified and included in earnings	299		299			598		598
Total before taxes	299		299			598		598
Income taxes	(72)		(72)			(144)		(144)
Ending Balance April 1, 2023	$	(41,476)	$	(41,476)		$	(41,476)	$	(41,476)

Stockholder Transaction Costs	6 Months Ended
Stockholder Transaction Costs	Mar. 30, 2024
Equity [Abstract]
Stockholder Transaction Costs	11. Stockholder Transaction Costs On December 14, 2023, the Company entered into an underwriting agreement with BofA Securities, Inc. and Barclays Capital Inc., as representatives of the several underwriters and American Securities LLC ("Selling Stockholder"), pursuant to which the Selling Stockholder agreed to sell 2,500,000 shares of common stock at a purchase price of $25.10 per share (“December Offering”). On February 15, 2024, the Company entered into an underwriting agreement with Barclays Capital Inc., as representative of the several underwriters and the Selling Stockholder, pursuant to which the Selling Shareholder agreed to sell 4,042,650 shares of common stock at a purchase price of $32.90 per share ("February Offering," and collectively with the December Offering, “Offerings”). The December Offering was conducted pursuant to a prospectus supplement, dated December 14, 2023, and the February Offering was conducted pursuant to a prospectus supplement, dated February 15, 2024, both to the prospectus dated December 22, 2021 included in the Company’s registration statement on Form S-3 (File No. 333-261858) that was initially filed with the SEC on December 23, 2021. The December Offering closed on December 19, 2023 and the February Offering closed on February 21, 2024. Although the Company did not sell any shares or receive any proceeds from the Offerings, it was required to pay certain expenses in connection with the Offerings that totaled approximately $1.9 million and $3.2 million for the three and six month periods ended March 30, 2024, with $0.7 million of similar expense recorded during both the three and six month periods ended April 1, 2023. The $1.9 million and $3.2 million of expense is included within other expense, net on the Condensed Consolidated Statements of Operations for the three and six month periods ended March 30, 2024, respectively, while the $0.7 million of expense is included within selling, general and administrative expenses on the Condensed Consolidated Statements of Operations for the three and six month periods ended April 1, 2023, but was subsequently reclassified to other expense, net, during the third quarter of fiscal 2023.

Joint Ventures	6 Months Ended
Joint Ventures	Mar. 30, 2024
Equity Method Investments and Joint Ventures [Abstract]
Joint Ventures	12. Joint Ventures Micro Bird Holdings, Inc. In December 2023, Micro Bird Holdings, Inc., our unconsolidated Canadian joint venture, paid dividends to all common stockholders, with the Company's proportionate share totaling $3.0 million, gross of required withholding taxes. The dividend was recorded as a reduction in the balance of equity investment in affiliate on the Condensed Consolidated Balance Sheets and is presented as a cash inflow in the operating section of the Condensed Consolidated Statements of Cash Flows. Clean Bus Solutions, LLC On December 7, 2023, the Company, through its wholly owned subsidiary, BBBC, and GC Mobility Investments I, LLC, a wholly owned subsidiary of Generate Capital, PBC (“Generate Capital”), a sustainable investment company focusing on clean energy, transportation, water, waste, agriculture, smart cities and industrial decarbonization, executed a definitive agreement (“Joint Venture Agreement”) establishing a joint venture, Clean Bus Solutions, LLC, to provide a fleet-as-a-service ("FaaS") offering using electric school buses manufactured and sold by the Company (“Joint Venture”). The service will be offered to qualified customers of the Company. Through the Joint Venture, the Company will provide its end customers with turnkey electrification solutions, including a wide product range consisting of, among others, electric school buses, financing of electric buses and supporting charging infrastructure, project planning and management, and fleet optimization. The Company and Generate Capital will initially have an equal common ownership interest in the Joint Venture, and will initially jointly share management responsibility and control, with each party having certain customary consent and approval rights and control triggers. The parties have each agreed to contribute up to $10.0 million to the Joint Venture, as agreed from time to time, for common interests to fund administrative expenses, and up to an additional $100.0 million of capital in the form of preferred interests to fund the purchase, delivery, installation, operation and maintenance of FaaS projects, inclusive of Blue Bird electric school buses and associated charging infrastructure. Of this amount, the Company has committed to provide up to $20.0 million and Generate Capital has committed to provide up to $80.0 million, with the Company’s aggregate commitment in any one year not to exceed $10.0 million without its consent. In accordance with the terms of the Joint Venture Agreement, the Company will promote the Joint Venture as the Company’s preferred FaaS offering for electric school buses and has agreed to not participate as a joint venture partner in any other similar FaaS offering for electric school buses, except as an original equipment manufacturer of buses. The Company’s obligations do not prevent or limit any activities of its dealers. The Joint Venture has a perpetual duration subject to the right of either party to terminate early upon the occurrence of certain events of default or the failure to achieve certain milestones set forth in the terms of the Joint Venture Agreement. In connection with the execution of the Joint Venture Agreement, the Company granted Generate Capital warrants to purchase an aggregate of 1,000,000 shares of Company common stock at an exercise price of $25.00 per share during a five-year exercise period (“Warrants”). Two-thirds of the Warrants were immediately exercisable while the remaining Warrants will become exercisable upon Generate Capital satisfying certain funding conditions. The exercise price and the number of shares issuable upon exercise of the Warrants are subject to adjustment in the event of a recapitalization, stock dividend or similar event. The Company recorded the $7.4 million fair value of the Warrants upon issuance as permanent equity within additional paid-in capital on the Condensed Consolidated Balance Sheets and is not required to subsequently record changes in fair value as long as the Warrants continue to be classified within stockholders' equity. Additionally, since the Warrants were provided in exchange for an investment in the Joint Venture, the Company recorded the cost of its investment based on the fair value of the Warrants upon issuance, which increased the balance of equity investment in affiliate on the Condensed Consolidated Balance Sheets by a corresponding $7.4 million. No other activity was recorded relating to the Joint Venture during the three and six month periods ended March 30, 2024.

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Pay vs Performance Disclosure
Net income (loss)	$ 26,023	$ 7,130	$ 52,173	$ (4,164)

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Mar. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Nature of Business and Basis of Presentation (Policies)	6 Months Ended
Nature of Business and Basis of Presentation (Policies)	Mar. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company transactions and accounts have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting and Article 10 of Regulation S-X. The Company’s fiscal year ends on the Saturday closest to September 30 with its quarters consisting of thirteen weeks in most years. The fiscal years ending September 28, 2024 ("fiscal 2024") and ended September 30, 2023 ("fiscal 2023") consist or consisted of 52 weeks. The second quarters of fiscal 2024 and fiscal 2023 both included 13 weeks. The six month periods in fiscal 2024 and 2023 both included 26 weeks. In the opinion of management, all adjustments considered necessary for a fair presentation of financial results have been made. Such adjustments consist of only those of a normal recurring nature. Operating results for any interim period are not necessarily indicative of the results that may be expected for the entire year. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The Condensed Consolidated Balance Sheet data as of September 30, 2023 was derived from the Company’s audited financial statements but does not include all disclosures required by U.S. GAAP. For additional information, including the Company’s significant accounting policies, refer to the consolidated financial statements and related footnotes as of and for the fiscal year ended September 30, 2023 as set forth in the Company's fiscal 2023 Form 10-K filed with the Securities and Exchange Commission ("SEC") on December 11, 2023.
Use of Estimates and Assumptions	Use of Estimates and Assumptions The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions. At the date of the financial statements, these estimates and assumptions affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities, and during the reporting period, these estimates and assumptions affect the reported amounts of revenues and expenses. For example, significant management judgments are required in determining excess, obsolete, or unsalable inventory; the allowance for doubtful accounts; potential impairment of long-lived assets, goodwill and intangible assets; and the accounting for self-insurance reserves, warranty reserves, pension obligations, income taxes, environmental liabilities and contingencies. Future events, including the extent and duration of continued supply chain constraints and their related economic impacts, and their effects cannot be predicted with certainty, and, accordingly, the Company’s accounting estimates require the exercise of judgment. The accounting estimates used in the preparation of the Company’s condensed consolidated financial statements may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. The Company evaluates and updates its assumptions and estimates on an ongoing basis and may employ outside experts to assist in the Company’s evaluations. Actual results could differ from the estimates that the Company has used.
Recently Issued Accounting Standards and Recently Adopted Accounting Standards	Recently Issued Accounting Standards ASU 2023-07 On November 27, 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments’ significant expenses on an interim and annual basis. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024, with early adoption permitted. ASU 2023-09 On December 14, 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires entities to disclose more detailed information in their reconciliation of their statutory tax rate to their effective tax rate. Public business entities ("PBEs") are required to provide this incremental detail in a numerical, tabular format. The ASU also requires entities to disclose more detailed information about income taxes paid, including by jurisdiction; pretax income (or loss) from continuing operations; and income tax expense (or benefit). The ASU is effective for PBEs in fiscal years beginning after December 15, 2024, and interim periods beginning after December 15, 2025, with early adoption permitted. The new ASUs will not impact amounts recorded in the financial statements but instead, will require more detailed disclosures in the footnotes to the financial statement. The Company plans to provide the updated disclosures required by the ASUs in the periods in which they are effective.

Supplemental Financial Information (Tables)

6 Months Ended

Mar. 30, 2024

Condensed Financial Information [Abstract]

Inventories

The following table presents the components of inventories at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Raw materials	$	99,019	$	88,116
Work in process	36,982		45,875
Finished goods	9,400		1,295
Total inventories	$	145,401	$	135,286

Restricted Cash


(in thousands of dollars)	March 30, 2024		April 1, 2023
Cash and cash equivalents	$	93,096	$	17,773
Restricted cash	—		238
Total cash, cash equivalents, and restricted cash reported on the Condensed Consolidated Statements of Cash Flows	$	93,096	$	18,011

Product Warranties

The following table reflects activity in accrued warranty cost (current and long-term portions combined) for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Balance at beginning of period	$	15,283	$	15,580	$	15,434	$	15,970
Add current period accruals	2,512		2,432		4,853		4,465
Current period reductions of accrual	(2,319)		(2,458)		(4,811)		(4,881)
Balance at end of period	$	15,476	$	15,554	$	15,476	$	15,554

Extended Warranties

The following table reflects activity in deferred warranty income (current and long-term portions combined), for the sale of extended warranties of two to five years, for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Balance at beginning of period	$	24,118	$	19,290	$	23,123	$	18,795
Add current period deferred income	3,562		2,756		6,560		5,092
Current period recognition of income	(2,117)		(1,965)		(4,120)		(3,806)
Balance at end of period	$	25,563	$	20,081	$	25,563	$	20,081

Self-Insurance

The following table reflects our total accrued self-insurance liability, comprised of workers' compensation and health insurance related claims, at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Current portion	$	5,247	$	4,475
Long-term portion	2,348		1,771
Total accrued self-insurance	$	7,595	$	6,246

Pension Expense

Components of net periodic pension benefit expense were as follows for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Interest cost	$	1,484	$	1,509	$	2,968	$	3,018
Expected return on plan assets	(1,620)		(1,630)		(3,240)		(3,260)
Amortization of prior loss	172		299		344		598
Net periodic pension benefit expense	$	36	$	178	$	72	$	356
Amortization of prior loss, recognized in other comprehensive income	(172)		(299)		(344)		(598)
Total recognized in net periodic pension benefit expense and other comprehensive income	$	(136)	$	(121)	$	(272)	$	(242)

Debt (Tables)

6 Months Ended

Mar. 30, 2024

Debt Disclosure [Abstract]

Schedule of Debt Covenant Requirements


Level	TNLR	ABR Loans	SOFR Loans
I	Less than 1.00x	0.75%	1.75%
II	Greater than or equal to 1.00x and less than 1.50x	1.50%	2.50%
III	Greater than or equal to 1.50x and less than 2.25x	2.00%	3.00%
IV	Greater than or equal to 2.25x	2.25%	3.25%

Schedule of Term Debt Instruments

Term loan borrowings consisted of the following at the dates indicated:


(in thousands of dollars)	March 30, 2024		September 30, 2023
Term loan borrowings, net of deferred financing costs of $1,428 and $1,456, respectively	$	97,322	$	130,344
Less: current portion of long-term debt	5,000		19,800
Long-term debt, net of current portion	$	92,322	$	110,544

Schedule of Maturities of Long-term Debt

The schedule of remaining principal payments through maturity for the term loans is as follows:


(in thousands of dollars)
Fiscal Year	Principal Payments
2024	$	2,500
2025	5,000
2026	5,000
2027	5,000
2028	5,000
Thereafter	76,250
Total remaining principal payments	$	98,750

Segment Information (Tables)

6 Months Ended

Mar. 30, 2024

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment


Net sales
	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Bus (1)	$	317,959	$	273,472	$	611,396	$	486,721
Parts (1)	27,956		26,342		52,179		48,825
Segment net sales	$	345,915	$	299,814	$	663,575	$	535,546


Gross profit (loss)
	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Bus	$	49,589	$	23,099	$	100,883	$	19,368
Parts	14,050		12,550		26,314		23,738
Segment gross profit	$	63,639	$	35,649	$	127,197	$	43,106

Reconciliation of Operating Profit (Loss) from Segments to Consolidated

The following table is a reconciliation of segment gross profit to consolidated income (loss) before income taxes for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Segment gross profit	$	63,639	$	35,649	$	127,197	$	43,106
Adjustments:
Selling, general and administrative expenses	(27,571)		(23,205)		(53,173)		(40,037)
Interest expense	(2,812)		(5,192)		(6,443)		(9,388)
Interest income	1,054		12		2,142		12
Other expense, net	(1,968)		(342)		(3,189)		(578)
Loss on debt refinancing or modification	—		—		(1,558)		(537)
Income (loss) before income taxes	$	32,342	$	6,922	$	64,976	$	(7,422)

Revenue from External Customers by Geographic Areas

Sales are attributable to geographic areas based on customer location and were as follows for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
U.S.	$	316,583	$	264,281	$	619,115	$	468,822
Canada	29,058		32,234		44,177		62,755
Rest of world	274		3,299		283		3,969
Total net sales	$	345,915	$	299,814	$	663,575	$	535,546

Revenue (Tables)

6 Months Ended

Mar. 30, 2024

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table disaggregates revenue by product category for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Diesel buses	$	123,444	$	89,795	$	208,442	$	161,289
Alternative power buses (1)	180,162		171,269		375,491		303,215
Other (2)	14,991		13,040		28,688		23,495


Parts	27,318		25,710		50,954		47,547
Net sales	$	345,915	$	299,814	$	663,575	$	535,546

(1) Includes buses sold with any power source other than diesel (e.g., gasoline, propane, compressed natural gas ("CNG") or electric).

(2) Includes shipping and handling revenue, extended warranty income, surcharges and chassis and bus shell sales

Earnings Per Share (Tables)

6 Months Ended

Mar. 30, 2024

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table presents the earnings (loss) per share computation for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands except for share data)	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Numerator:
Net income (loss)	$	26,023	$	7,130	$	52,173	$	(4,164)

Denominator:
Weighted-average common shares outstanding	32,240,458		32,033,709		32,205,657		32,029,999
Weighted-average dilutive securities, restricted stock	390,498		270,156		283,078		—
Weighted-average dilutive securities, stock options	183,538		18,298		153,044		—
Weighted-average dilutive securities, warrants (Note 12)	260,098		—		186,560		—

Weighted-average shares and dilutive potential common shares (1)	33,074,592		32,322,163		32,828,339		32,029,999

Earnings (loss) per share:
Basic earnings (loss) per share	$	0.81	$	0.22	$	1.62	$	(0.13)
Diluted earnings (loss) per share	$	0.79	$	0.22	$	1.59	$	(0.13)

Accumulated Other Comprehensive Loss (Tables)

6 Months Ended

Mar. 30, 2024

Equity [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss)

The following table provides information on changes in accumulated other comprehensive loss ("AOCL") for the periods presented:


	Three Months Ended				Six Months Ended
(in thousands of dollars)	Defined Benefit Pension Plan		Total AOCL			Defined Benefit Pension Plan		Total AOCL
March 30, 2024
Beginning Balance	$	(31,753)	$	(31,753)		$	(31,884)	$	(31,884)

Amounts reclassified and included in earnings	172		172			344		344
Total before taxes	172		172			344		344
Income taxes	(41)		(41)			(82)		(82)
Ending Balance March 30, 2024	$	(31,622)	$	(31,622)		$	(31,622)	$	(31,622)

April 1, 2023
Beginning Balance	$	(41,703)	$	(41,703)		$	(41,930)	$	(41,930)

Amounts reclassified and included in earnings	299		299			598		598
Total before taxes	299		299			598		598
Income taxes	(72)		(72)			(144)		(144)
Ending Balance April 1, 2023	$	(41,476)	$	(41,476)		$	(41,476)	$	(41,476)

Supplemental Financial Information - Inventories (Details) - USD ($) $ in Thousands	Mar. 30, 2024	Sep. 30, 2023
Condensed Financial Information [Abstract]
Raw materials	$ 99,019	$ 88,116
Work in process	36,982	45,875
Finished goods	9,400	1,295
Total inventories	$ 145,401	$ 135,286

Supplemental Financial Information - Restricted Cash (Details) - USD ($) $ in Thousands	Mar. 30, 2024	Sep. 30, 2023	Apr. 01, 2023	Sep. 30, 2022
Condensed Financial Information Disclosure [Abstract]
Cash and cash equivalents	$ 93,096	$ 78,988	$ 17,773
Restricted cash	0		238
Total cash, cash equivalents, and restricted cash reported on the Condensed Consolidated Statements of Cash Flows	$ 93,096	$ 78,988	$ 18,011	$ 10,479

Supplemental Financial Information - Product Warranty Rollforward (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Movement in Standard Product Warranty Accrual [Roll Forward]
Balance at beginning of period	$ 15,283	$ 15,580	$ 15,434	$ 15,970
Add current period accruals	2,512	2,432	4,853	4,465
Current period reductions of accrual	(2,319)	(2,458)	(4,811)	(4,881)
Balance at end of period	$ 15,476	$ 15,554	$ 15,476	$ 15,554

Supplemental Financial Information - Extended Warranty Income (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Movement in Extended Product Warranty Accrual [Roll Forward]
Balance at beginning of period	$ 24,118	$ 19,290	$ 23,123	$ 18,795
Add current period deferred income	3,562	2,756	6,560	5,092
Current period recognition of income	(2,117)	(1,965)	(4,120)	(3,806)
Balance at end of period	$ 25,563	$ 20,081	$ 25,563	$ 20,081

Supplemental Financial Information Remaining Performance Obligation (Details) $ in Millions	Mar. 30, 2024 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-02
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation	$ 4.5
Revenue, performance obligation, (in years)	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-02
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation	$ 7.8
Revenue, performance obligation, (in years)	1 year

Supplemental Financial Information - Self Insurance (Details) - USD ($) $ in Thousands	Mar. 30, 2024	Sep. 30, 2023
Condensed Financial Information [Abstract]
Current portion	$ 5,247	$ 4,475
Long-term portion	2,348	1,771
Total accrued self-insurance	$ 7,595	$ 6,246

Supplemental Financial Information - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Product Warranty Liability [Line Items]
Shipping and handling revenues	$ 345,915	$ 299,814	$ 663,575	$ 535,546
Funds awarded by the U.S. EPA	800		$ 800
Minimum
Product Warranty Liability [Line Items]
Extended product warranty, period			2 years
Maximum
Product Warranty Liability [Line Items]
Extended product warranty, period			5 years
Shipping and Handling
Product Warranty Liability [Line Items]
Shipping and handling revenues	5,000	4,200	$ 9,700	8,500
Shipping and handling cost of goods sold	$ 4,400	$ 3,900	$ 8,700	$ 7,700

Supplemental Financial Information - Pension Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Condensed Financial Information [Abstract]
Interest cost	$ 1,484	$ 1,509	$ 2,968	$ 3,018
Expected return on plan assets	(1,620)	(1,630)	(3,240)	(3,260)
Amortization of prior loss	172	299	344	598
Net periodic pension benefit expense	36	178	72	356
Amortization of prior loss, recognized in other comprehensive income	(172)	(299)	(344)	(598)
Total recognized in net periodic pension benefit expense and other comprehensive income	$ (136)	$ (121)	$ (272)	$ (242)

Debt - Narrative (Details) - USD ($)		3 Months Ended		6 Months Ended
Debt - Narrative (Details) - USD ($)	Nov. 17, 2023	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023	Sep. 30, 2023	Nov. 24, 2021
Debt Instrument [Line Items]
Interest expense		$ 2,800,000	$ 5,200,000	$ 6,400,000	$ 9,400,000
Credit Agreement
Debt Instrument [Line Items]
Debt Instrument, Face Amount	$ 250,000,000
Debt Instrument, Term	5 years
Senior Term Loan \| Senior Credit Facility
Debt Instrument [Line Items]
Long-term line of credit		$ 98,800,000		$ 98,800,000		$ 131,800,000
Stated interest rate (as a percent)		7.20%		7.20%		10.00%
Weighted average effective interest rate (as a percent)		8.20%		8.20%		10.90%
Revolving Credit Facility \| Credit Agreement
Debt Instrument [Line Items]
Debt Instrument, Face Amount	$ 36,200,000
Term Loan \| Third Amendment to the Credit Agreement
Debt Instrument [Line Items]
Debt Instrument, Face Amount	131,800,000
Term Loan \| Credit Agreement
Debt Instrument [Line Items]
Debt Instrument, Face Amount	$ 100,000,000
Percentage of principal outstanding	5.00%
Term Loan \| Credit Agreement \| Minimum
Debt Instrument [Line Items]
Line of Credit Facility, Commitment Fee Percentage	0.25%
Term Loan \| Credit Agreement \| Maximum
Debt Instrument [Line Items]
Line of Credit Facility, Commitment Fee Percentage	0.45%
Term Loan \| Credit Agreement \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	0.10%
Revolving Credit Facility \| Line of Credit \| Third Amendment to the Credit Agreement
Debt Instrument [Line Items]
Lender fees and other issuance costs							$ 3,100,000
Revolving Credit Facility \| Line of Credit \| Third Amendment to the Credit Agreement \| Gain (Loss) o Extinguishment of Debt
Debt Instrument [Line Items]
Lender fees and other issuance costs							400,000
Revolving Credit Facility \| Line of Credit \| Third Amendment to the Credit Agreement \| Other Noncurrent Assets
Debt Instrument [Line Items]
Lender fees and other issuance costs							1,900,000
Revolving Credit Facility \| Line of Credit \| Third Amendment to the Credit Agreement \| Senior Notes, Noncurrent
Debt Instrument [Line Items]
Lender fees and other issuance costs							$ 800,000
Revolving Credit Facility \| Line of Credit \| Credit Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 150,000,000
Revolving Credit Facility \| Line of Credit \| Credit Agreement \| Gain (Loss) o Extinguishment of Debt
Debt Instrument [Line Items]
Lender fees and other issuance costs	1,100,000
Letters of Credit \| Line of Credit \| Senior Revolving Credit Facility
Debt Instrument [Line Items]
Remaining borrowing capacity		$ 143,300,000		$ 143,300,000
Letters of credit, amount outstanding		$ 6,700,000		$ 6,700,000
Letters of Credit \| Line of Credit \| Credit Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	25,000,000
Swingline Credit Facility \| Line of Credit \| Credit Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 5,000,000

Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands	Mar. 30, 2024	Sep. 30, 2023
Debt Instrument [Line Items]
Current portion of long-term debt	$ 5,000	$ 19,800
Long-term debt	92,322	110,544
Senior Term Loan \| 2023 Term Loan
Debt Instrument [Line Items]
Total debt	97,322	130,344
Deferred financing costs	$ 1,428	$ 1,456

Debt - Maturity Schedule (Details) $ in Thousands	Mar. 30, 2024 USD ($)
Long-term Debt, Fiscal Year Maturity
2024	$ 2,500
2025	5,000
2026	5,000
2027	5,000
2028	5,000
Thereafter	76,250
Total debt	$ 98,750

Debt - Schedule of Debt Covenant Requirements (Details) - Term Loan - Credit Agreement		6 Months Ended
	Nov. 17, 2023	Mar. 30, 2024
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	0.10%
Less than 1.00x \| ABR Loans
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)		0.75%
Less than 1.00x \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)		1.75%
Greater than or equal to 1.00x and less than 1.50x \| ABR Loans
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)		1.50%
Greater than or equal to 1.00x and less than 1.50x \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)		2.50%
Greater than or equal to 1.50x and less than 2.25x \| ABR Loans
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)		2.00%
Greater than or equal to 1.50x and less than 2.25x \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)		3.00%
Greater than or equal to 2.25x \| ABR Loans
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)		2.25%
Greater than or equal to 2.25x \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)		3.25%

Income Taxes (Details)	3 Months Ended		6 Months Ended
Income Taxes (Details)	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Income Tax Disclosure [Abstract]
Effective tax rate (as a percent)	25.50%	20.10%	25.70%	21.40%
Statutory Federal income tax rate (as a percent)	21.00%	21.00%	21.00%	21.00%

Segment Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
Segment Information (Details) $ in Thousands	Mar. 30, 2024 USD ($)	Apr. 01, 2023 USD ($)	Mar. 30, 2024 USD ($) segment	Apr. 01, 2023 USD ($)
Segment Reporting Information [Line Items]
Number of Operating Segments \| segment			2
Net sales	$ 345,915	$ 299,814	$ 663,575	$ 535,546
Gross profit	63,639	35,649	127,197	43,106
U.S.
Segment Reporting Information [Line Items]
Net sales	316,583	264,281	619,115	468,822
Canada
Segment Reporting Information [Line Items]
Net sales	29,058	32,234	44,177	62,755
Rest of world
Segment Reporting Information [Line Items]
Net sales	274	3,299	283	3,969
Operating Segments
Segment Reporting Information [Line Items]
Gross profit	63,639	35,649	127,197	43,106
Operating Segments \| Bus
Segment Reporting Information [Line Items]
Net sales	317,959	273,472	611,396	486,721
Gross profit	49,589	23,099	100,883	19,368
Operating Segments \| Parts
Segment Reporting Information [Line Items]
Net sales	27,956	26,342	52,179	48,825
Gross profit	14,050	12,550	26,314	23,738
Intersegment Eliminations \| Parts
Segment Reporting Information [Line Items]
Net sales	$ 2,700	$ 1,300	$ 4,300	$ 2,400

Segment Information - Reconciliation of Segment Gross Profit (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Segment gross profit	$ 63,639	$ 35,649	$ 127,197	$ 43,106
Selling, general and administrative expenses	(27,571)	(23,205)	(53,173)	(40,037)
Interest expense	(2,812)	(5,192)	(6,443)	(9,388)
Interest income	1,054	12	2,142	12
Other expense, net	(1,968)	(342)	(3,189)	(578)
Loss on debt refinancing or modification	0	0	(1,558)	(537)
Income (loss) before income taxes	32,342	6,922	64,976	(7,422)
Operating Segments
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Segment gross profit	63,639	35,649	127,197	43,106
Segment Reconciling Items
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Selling, general and administrative expenses	(27,571)	(23,205)	(53,173)	(40,037)
Interest expense	(2,812)	(5,192)	(6,443)	(9,388)
Interest income	1,054	12	2,142	12
Other expense, net	(1,968)	(342)	(3,189)	(578)
Loss on debt refinancing or modification	$ 0	$ 0	$ (1,558)	$ (537)

Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Revenue (Details) - USD ($) $ in Thousands	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Disaggregation of Revenue [Line Items]
Net sales	$ 345,915	$ 299,814	$ 663,575	$ 535,546
Diesel buses
Disaggregation of Revenue [Line Items]
Net sales	123,444	89,795	208,442	161,289
Alternative fuel buses
Disaggregation of Revenue [Line Items]
Net sales	180,162	171,269	375,491	303,215
Other
Disaggregation of Revenue [Line Items]
Net sales	14,991	13,040	28,688	23,495
Parts
Disaggregation of Revenue [Line Items]
Net sales	$ 27,318	$ 25,710	$ 50,954	$ 47,547

Earnings Per Share - Summary of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net income (loss)	$ 26,023	$ 7,130	$ 52,173	$ (4,164)
Weighted-average common shares outstanding	32,240,458	32,033,709	32,205,657	32,029,999
Weighted average diluted securities, warrants	260,098	0	186,560	0
Weighted-average shares and dilutive potential common shares	33,074,592	32,322,163	32,828,339	32,029,999
Basic earnings per share (in dollars per share)	$ 0.81	$ 0.22	$ 1.62	$ (0.13)
Diluted earnings per share (in dollars per share)	$ 0.79	$ 0.22	$ 1.59	$ (0.13)
Restricted Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Weighted-average dilutive securities	390,498	270,156	283,078	0
Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Weighted-average dilutive securities	183,538	18,298	153,044	0

Earnings Per Share - Narrative (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
Earnings Per Share [Abstract]
Anti-dilutive securities excluded from computation of earnings per share (in shares)	0.0	0.4	0.0	0.7

Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 30, 2024	Apr. 01, 2023	Mar. 30, 2024	Apr. 01, 2023
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance			$ 39,998
Ending Balance	$ 105,788		105,788
Defined Benefit Pension Plan
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(31,753)	$ (41,703)	(31,884)	$ (41,930)
Amounts reclassified and included in earnings	172	299	344	598
Total before taxes	172	299	344	598
Income taxes	(41)	(72)	(82)	(144)
Ending Balance	(31,622)	(41,476)	(31,622)	(41,476)
AOCI Attributable to Parent
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(31,753)	(41,703)	(31,884)	(41,930)
Amounts reclassified and included in earnings	172	299	344	598
Total before taxes	172	299	344	598
Income taxes	(41)	(72)	(82)	(144)
Ending Balance	$ (31,622)	$ (41,476)	$ (31,622)	$ (41,476)

Stockholder Transaction Costs (Details) - USD ($) $ / shares in Units, $ in Millions		6 Months Ended
	Jun. 07, 2023	Mar. 30, 2024
Subsidiary, Sale of Stock [Line Items]
Common stock sold, price per share (in USD per share)	$ 25.10
Private Placement
Subsidiary, Sale of Stock [Line Items]
Common stock sold (in shares)	2,500,000
Accrue common stock issuance costs		$ 1.9

Joint Ventures (Details) - USD ($) $ / shares in Units, $ in Millions		1 Months Ended	6 Months Ended
	Dec. 07, 2023	Dec. 30, 2023	Mar. 30, 2024
Schedule of Equity Method Investments [Line Items]
Contribution to joint venture	$ 10.0
Interest in joint venture	100.0
Maximum joint venture commitment	$ 20.0
Fair value of warrants			$ 7.4
Warrant
Schedule of Equity Method Investments [Line Items]
Issued (shares)	1,000,000
Exercise price (dollars per share)	$ 25.00
Related Party
Schedule of Equity Method Investments [Line Items]
Dividends		$ 3.0
Maximum joint venture commitment	$ 80.0