Regis Corporation Announces New Long-Term Incentive Plan That Further Aligns Executive Management and Shareholder Interests

Regis Corporation (NYSE: RGS), a leader in the haircare industry, whose primary business is owning, operating, and franchising hair salons, today announced a new Long-Term Incentive Plan that further aligns the interests of the Executive Management Team and shareholders.

The new plan design is a testament to the willingness of the Board of Directors and the Executive Management Team to embrace creative compensation alternatives intended to maximize shareholder value. The Long-Term Incentive Plan promotes an "ownership mentality” by rewarding outcomes that are directly aligned with the execution of Regis’s strategic transformation and facilitates a long-term management perspective that will support the success of Regis for years to come.

Under the fiscal 2019 Long-Term Incentive Plan, executives will no longer receive automatic annual equity grants. Instead, each eligible executive will receive a single, larger initial equity grant at the outset of a five-year period with no further automatic yearly grants for the remainder of the period. These grants come with significant performance requirements and a 5-year cliff vesting on the PSU components and a 3-year cliff vesting on the RSU components. The Company believes this type of longer than average holding requirement creates a strong alignment with shareholder interests. Additionally, we have created a "matching share program” under which senior executives are encouraged to buy shares with a portion of their own money if they first achieve annual short-term incentive targets. Such purchased shares must be held for five years to receive the company match. As eligible executives may only purchase shares using up to 50 percent of their target bonus for FY18 and earned bonus thereafter, the maximum matching grant opportunity will be lower in years of below-target payout, and higher in years of strong performance.

"We believe it is significant that our fiscal 2019 pay plan has a much longer-term focus than the plan it replaces,” commented Regis Compensation Committee Chairman Daniel Beltzman. Mr. Beltzman continued, "We believe that a five-year time frame is long enough for managers to experience the effects of their decision making and act like true owners. The extended duration of the plan means management will almost always have significant amounts of unvested equity, discouraging poaching, encouraging retention, and minimizing the impact on shareholders if we part ways with non-performing executives. Additionally, Executive Management can only earn their performance based up-front grant if Regis’ stock price increases sufficiently and generates increased shareholder value.”

"Overall, we wanted the Regis Executive Management Team to do more than think like owners—we wanted them to be owners, and to invest their own funds to become owners beginning this year facilitated by our new compensation plan. We further wanted compensation to reward the achievement of disclosed financial goals and the achievement of the key elements of an evolving long-term strategy. Finally, we wanted to design a plan that allowed us to focus on the stability of the Executive Management Team during this multi-year transformation effort,” Mr. Beltzman concluded.

Your attention is directed to the Company’s FY2018 Proxy which we expect to file on or about September 6, 2018 which will provide further disclosures and details regarding the company’s new executive compensation program.

About Regis Corporation
Regis Corporation (NYSE:RGS) is a leader in beauty salons and cosmetology education. As of June 30, 2018, the Company owned, franchised or held ownership interests in 8,168 worldwide locations. Regis’ corporate and franchised locations operate under concepts such as Supercuts®, SmartStyle®, MasterCuts®, Regis Salons®, Sassoon®, Cost Cutters®, Roosters® and First Choice Haircutters®. Regis maintains an ownership interest in Empire Education Group in the U.S. For additional information about the Company, including a reconciliation of certain non-GAAP financial information and certain supplemental financial information, please visit the Investor Information section of the corporate website at www.regiscorp.com.

This press release contains or may contain "forward-looking statements” within the meaning of the federal securities laws, including statements concerning anticipated future events and expectations that are not historical facts. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements in this document reflect management’s best judgment at the time they are made, but all such statements are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those expressed in or implied by the statements herein. Such forward-looking statements are often identified herein by use of words including, but not limited to, "may,” "believe,” "project,” "forecast,” "expect,” "estimate,” "anticipate,” and "plan.” In addition, the following factors could affect the Company’s actual results and cause such results to differ materially from those expressed in forward-looking statements. These factors include the continued ability of the Company to implement its strategy, priorities and initiatives; our ability to attract, train and retain talented stylists; financial performance of our franchisees; acceleration of sale of certain salons to franchisees; The Beautiful Group's ability to transition and operate its salons successfully, as well as maintain adequate working capital; the ability of the Company to maintain a satisfactory relationship with Walmart; marketing efforts to drive traffic; changes in regulatory and statutory laws including increases in minimum wages; our ability to maintain and enhance the value of our brands; premature termination of agreements with our franchisees; our ability to manage cyber threats and protect the security of sensitive information about our guests, employees, vendors or Company information; reliance on information technology systems; reliance on external vendors; competition within the personal hair care industry; changes in tax exposure; changes in healthcare; changes in interest rates and foreign currency exchange rates; failure to standardize operating processes across brands; consumer shopping trends and changes in manufacturer distribution channels; financial performance of Empire Education Group; the continued ability of the Company to implement cost reduction initiatives; compliance with debt covenants; changes in economic conditions; changes in consumer tastes and fashion trends; exposure to uninsured or unidentified risks; ability to attract and retain key management personnel; reliance on our management team and other key personnel or other factors not listed above. Additional information concerning potential factors that could affect future financial results is set forth in the Company’s Annual Report on Form 10-K for the year ended June 30, 2018. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. However, your attention is directed to any further disclosures made in our subsequent annual and periodic reports filed or furnished with the SEC on Forms 10-K, 10-Q and 8-K and Proxy Statements on Schedule 14A.

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