<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 [FEE REQUIRED]
For the fiscal year ended June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _________ to __________
Commission file number 0-11230
---------------------------
Full title of the plan and the address of the plan, if different from that
of the issuer named below.
REGIS CORPORATION 1991 CONTRIBUTORY STOCK PURCHASE PLAN
Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
REGIS CORPORATION
7201 Metro Boulevard
Minneapolis, Minnesota 55439
612-947-7000
<PAGE>
REGIS CORPORATION 1991 CONTRIBUTORY STOCK PURCHASE PLAN
REPORT ON AUDITS OF FINANCIAL STATEMENTS
AS OF JUNE 30, 1998 AND 1997 AND FOR EACH OF THE THREE YEARS
IN THE PERIOD ENDED JUNE 30, 1998
<PAGE>
INDEX OF FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE(S)
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<S> <C>
Report of Independent Accountants 2
Statement of Assets Available for Plan Benefits
as of June 30, 1998 and 1997 3
Statement of Changes in Assets Available for Plan Benefits
for each of the three years in the period ended June 30, 1998 4
Notes to Financial Statements 5-10
</TABLE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Compensation Committee of the Board of Directors of
Regis Corporation:
In our opinion, the accompanying statement of assets available for plan benefits
and the related statement of changes in assets available for plan benefits
present fairly, in all material respects, the assets available for plan benefits
of the Regis Corporation 1991 Contributory Stock Purchase Plan as of June 30,
1998 and 1997, and the changes in assets available for plan benefits for each of
the three years in the period ended June 30, 1998, in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Plan's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
/s/ PricewaterhouseCoopers LLP
PRICEWATERHOUSECOOPERS LLP
Minneapolis, Minnesota
September 15, 1998
2
<PAGE>
REGIS CORPORATION 1991 CONTRIBUTORY STOCK PURCHASE PLAN
STATEMENT OF ASSETS AVAILABLE FOR PLAN BENEFITS
<TABLE>
<CAPTION>
JUNE 30
-------------------------
ASSETS 1998 1997
<S> <C> <C>
Common stock of Regis Corporation, at fair value
(cost of $2,946,504 and $2,429,656 at June 30,
1998 and 1997, respectively) $4,549,268 $3,712,472
---------- ----------
Assets available for plan benefits $4,549,268 $3,712,472
---------- ----------
---------- ----------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
3
<PAGE>
REGIS CORPORATION 1991 CONTRIBUTORY STOCK PURCHASE PLAN
STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS
<TABLE>
<CAPTION>
YEARS ENDED JUNE 30
----------------------------------------
1998 1997 1996
<S> <C> <C> <C>
Additions to assets:
Employee contributions $1,468,531 $ 1,258,628 $ 866,908
Employer contributions 259,037 222,178 153,038
Dividend income 14,158 11,022 9,531
Unrealized appreciation (depreciation)
of investments 319,948 (1,237,991) 1,979,362
Net realized gains on withdrawals by
participants of common stock 636,376 337,167 552,525
---------- ----------- ----------
Total additions 2,698,050 591,004 3,561,364
Deductions from assets:
Withdrawals by participants of common stock,
at fair value 1,861,254 950,300 1,190,514
---------- ----------- ----------
Net increase (decrease) 836,796 (359,296) 2,370,850
Assets available for plan benefits:
Beginning of year 3,712,472 4,071,768 1,700,918
---------- ----------- ----------
End of year $4,549,268 $ 3,712,472 $4,071,768
---------- ----------- ----------
---------- ----------- ----------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
4
<PAGE>
REGIS CORPORATION 1991 CONTRIBUTORY STOCK PURCHASE PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF PLAN:
The following brief description of the Regis Corporation 1991 Contributory
Stock Purchase Plan (the Plan) is provided for general information purposes
only. Participants should refer to the Plan agreement for complete
information regarding the Plan's definitions, benefits, eligibility and
other matters.
GENERAL:
The Plan is a contributory defined contribution plan designed to enable
Regis Corporation (the Company) participating employees and franchise
employees to purchase shares of common stock of the Company through an
agent at prevailing market prices based on contributions made by the
participants and the Company. The Plan is not subject to the provisions of
the Employee Retirement Income Security Act of 1974, as amended (ERISA).
The Plan was approved by the Company's Board of Directors on July 29, 1991
and commenced on January 1, 1992. A total of 1,200,000 shares of the
Company's common stock may be acquired under the Plan, on behalf of the
participants.
ELIGIBILITY:
All employees of the Company (including those who are officers and
directors) are eligible to participate in the Plan. Effective January 1,
1995, employees of the Company's franchised locations also became eligible
to participate in the Plan. As of June 30, 1998, there were approximately
2,300 participants in the Plan.
CONTRIBUTIONS:
An eligible participant may contribute to the Plan through payroll
deductions with a minimum deduction of $10 per month and a maximum
deduction not to exceed ten percent of total compensation. Contributions
can be made via a fixed dollar contribution or a percentage of compensation
contribution. The Company contributes to the Plan fifteen percent of the
purchase price of the common stock to be purchased on the open market and,
in addition, pays all commissions and fees related to the acquisition of
the common stock. Contributions are not deemed to have been made under the
Plan until they have been received by the agent. Employees are fully
vested in their own contributions and in the Company's fifteen percent
contribution upon the purchase of common stock on their behalf. The Plan
provides that in no event shall the Company make contributions under the
Plan in excess of $2,200,000 in the aggregate (including all expenses of
the Plan paid by the Company).
5
<PAGE>
1. DESCRIPTION OF PLAN, CONTINUED:
EXPENSES:
The Plan provides, among other things, that all expenses of the Plan and
its administration will be paid by the Company. These expenses include
primarily broker's commissions, transfer fees, administrative costs and
similar expenses.
THE AGENT AND PURCHASES OF COMMON STOCK:
The agent for the Plan, Piper Jaffray Inc., maintains custody of the Plan's
assets and uses the participants' payroll deductions, the Company's
contributions, and cash dividends received, if any, to purchase common
stock of the Company on the open market, as set forth under the Plan
document.
WITHDRAWALS AND TERMINATION OF EMPLOYMENT:
The Plan provides that upon withdrawal from the Plan, each participant will
receive the shares of common stock of the Company held on the participant's
behalf by the agent and cash for any fractional shares held. On
termination of employment, distribution will be made to the employee, or,
in the case of death, to the persons entitled thereto, of all shares and
cash adjustments as described above.
PLAN TERMINATION:
The Plan will end at the earliest of the following times:
- When the Company has contributed $2,200,000 in aggregate to the Plan,
including all expenses of the Plan paid by the Company (as of June 30,
1998, the Company had contributed an aggregate of $1,088,001 to the
Plan);
- When the 1,200,000 shares registered with the Securities and Exchange
Commission have been purchased (as of June 30, 1998, there were
742,999 shares available for purchase);
- At any time after the giving of 30 days notice by the Company; or
- At June 30, 1999, unless the Plan is extended to a later date.
Upon termination of the Plan, all unapplied cash credits not already used
to purchase common stock of the Company remaining in participants' accounts
would be refunded in cash to participants.
6
<PAGE>
1. DESCRIPTION OF PLAN, CONTINUED:
The Company's Board of Directors may from time to time suspend, discontinue
or extend the Plan or revise or amend it as they may deem necessary or
appropriate. During 1998, the Company's Board of Directors amended the
Plan. The amendment increased in the Company's maximum contribution to
$2,200,000.
FEDERAL INCOME TAX CONSEQUENCES:
The Plan is not qualified under Section 401(a) of the Internal Revenue Code
of 1986, as amended, and the restrictions and special tax treatment
provided therein are not available to participants. The Plan does not
provide for income taxes as all taxable income is taxable to the
participants. Amounts contributed by the Company are treated as part of
the employees' salary or wages and are subject to income tax withholding.
Dividends on the stock held, if any, are used to purchase additional
shares for each participant holding such stock on the record date of the
dividend. Upon disposition of the common stock of the Company purchased
under the Plan, participants must treat any gain or loss as long-term or
short-term capital gains depending on the holding period of such shares.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
BASIS OF ACCOUNTING:
The accompanying financial statements of the Plan have been prepared on the
accrual basis of accounting. Withdrawals of common stock are recorded at
the date of withdrawal, at fair value.
EMPLOYEE ACCOUNTS:
The agent for the Plan maintains a separate account for each participating
employee. The agent allocates to each account the number of full and
fractional shares of the Company's common stock purchased with
contributions and other proceeds credited to such account.
7
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
COMMON STOCK VALUATION:
Common stock of the Company is stated at fair value as quoted on NASDAQ.
The differences between fair value at dates of withdrawal and cost of
shares, computed on an average cost basis, are reported as realized gains
or losses in the statement of changes in assets available for plan
benefits. The differences between the quoted fair value at the end of the
Plan year and cost of shares not withdrawn are reported as unrealized
appreciation or depreciation in the statement of changes in assets
available for plan benefits.
USE OF ESTIMATES:
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make certain
estimates and assumptions that affect the reported amounts of assets,
additions to assets and deductions from assets during the reporting period.
Actual results could differ from those estimates.
3. CONCENTRATION OF MARKET RISK:
The Plan's assets available for plan benefits consist entirely of the
common stock of Regis Corporation. Accordingly, the underlying value of
the Plan assets is entirely dependent on the performance of Regis
Corporation and the market's evaluation of such performance. It is at
least reasonably possible that changes in risks in the near term would
materially affect participants' account balances and the amounts reported
in the statement of assets available for plan benefits and the statement of
changes in assets available for plan benefits.
4. STOCK SPLIT:
All shares and price per share amounts have been adjusted for the Company's
three-for-two stock split on May 20, 1996.
8
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5. ANALYSIS OF COMMON STOCK ACTIVITY:
The following sets forth the Plan activity and related costs with respect
to the Company's common stock:
<TABLE>
<CAPTION>
SHARES (1) COST
<S> <C> <C>
Balance at June 30, 1995 132,540 $1,159,473
1996 purchases 59,860 1,029,477
1996 withdrawals by participants (62,103) (637,989)
-------- ----------
Balance at June 30, 1996 130,297 1,550,961
1997 purchases 69,815 1,491,828
1997 withdrawals by participants ( 42,970) ( 613,133)
-------- ----------
Balance at June 30, 1997 157,142 2,429,656
1998 purchases 66,384 1,741,726
1998 withdrawals by participants (69,640) (1,224,878)
-------- ----------
Balance at June 30, 1998 153,886 $2,946,504
-------- ----------
-------- ----------
</TABLE>
(1) Rounded to nearest share.
At June 30, 1998 and 1997, the share price of Regis Corporation common
stock, based on quoted market value, was $29.56 and $23.625, respectively.
6. UNREALIZED APPRECIATION (DEPRECIATION) OF COMMON STOCK:
The change in unrealized appreciation (depreciation) of the Company's
common stock was as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
Unrealized appreciation at end of period $ 1,602,764 $1,282,816 $2,520,807
Less unrealized appreciation
at beginning of period 1,282,816 2,520,807 541,445
----------- ----------- ----------
Unrealized appreciation (depreciation)
for the period $ 319,948 ($1,237,991) $1,979,362
----------- ----------- ----------
----------- ----------- ----------
</TABLE>
9
<PAGE>
7. NET REALIZED GAINS ON WITHDRAWALS BY PARTICIPANTS:
The net realized gains on distributions of the Company's common stock to
participants is summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
Fair value at dates of distribution $1,861,254 $ 950,300 $1,190,514
Less cost of shares distributed, computed
on an average cost basis (1,224,878) (613,133) (637,989)
---------- ---------- ----------
Net realized gains for the period $ 636,376 $ 337,167 $ 552,525
---------- ---------- ----------
---------- ---------- ----------
</TABLE>
10
<PAGE>
EXHIBITS
The following documents are filed as exhibits to this Report:
<TABLE>>
<CAPTION>
EXHIBIT NO. DOCUMENT
<S> <C>
23 Consent of Independent Accountants
</TABLE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Compensation Committee of the Board of Directors of Regis Corporation has duly
caused this annual report to be signed by the undersigned thereunto duly
authorized.
REGIS CORPORATION 1991 CONTRIBUTORY
STOCK PURCHASE PLAN
By: REGIS CORPORATION
By /s/ Paul D. Finkelstein
------------------------
Paul D. Finkelstein
Chief Executive Officer
Dated: September 28, 1998
11
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DOCUMENT PAGE
<S> <C> <C>
23 Consent of Independent Accountants 13
</TABLE>
12
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EXHIBIT 23
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement of
Regis Corporation on Form S-8 (Registration No. 33-44867) of our report dated
September 15, 1998, on our audits of the financial statements of the Regis
Corporation 1991 Contributory Stock Purchase Plan as of June 30, 1998 and
1997 and for each of the three years in the period ended June 30, 1998, which
report is included in this Annual Report on Form 11-K.
/s/ PricewaterhouseCoopers LLP
PRICEWATERHOUSECOOPERS LLP
Minneapolis, Minnesota
September 28, 1998
13
