William Charters sent a letter to the Regis Corp
$RGS
Regis Corporation
3701 Wayzata Boulevard
Minneapolis, MN 55416
Attention: David J. Grissen, Chairman of the Board of Directors
Dear Mr. Grissen,
We are writing to congratulate you, the board of directors (the “Board”) of the Regis Corporation (the “Company”) management team for an incredible shareholder-friendly resolution to the Company’s strategic alternatives initiative. We are also excited that the strategy alluded to in the last press release includes some of the ideas that we have communicated to the Board. With a solid balance sheet and a focused management team, the Company is now in a position to execute its business plan and create significant shareholder value.
It is important that the Company complete its transition to a franchise-only concept by continuing to cut unnecessary costs and streamline operations. Financial discipline is imperative. At the same time, management needs to leverage its scale to help franchisees differentiate themselves by identifying partners to embrace the latest technologies. We are excited about the first positive signs of the Zenoti roll-out which has resulted in a large increase in positive google reviews across all concepts and a noticeable increase in salon ratings. We are further excited about the Company’s use of technology for stylist training which we believe is superior, more cost effective, and will only get better over time. We believe the recent improvements in computer vision, augmented reality, and artificial intelligence technology opens many doors for full-service salon chains like the Company to use its scale to create a new and exciting experience that increases customer stickiness and creates multiple avenues for increased revenue.
We also believe management’s back to basics initiative, requiring a consistent experience at all locations, should improve the value of the Company’s brands and drive revenue growth as best practices are adopted throughout the system.
It is important that the Board follows its guidelines and refreshes itself accordingly to encourage new operational ideas. We also believe the best way for the Company to reach its potential is a management compensation package tilted towards equity. That said, the Board has done an amazing job in refinancing and positioning the Company for success.
Given recent events, we feel our financial and operating concerns have been alleviated. As such, we have terminated our reporting group that holds approximately 8% of the Company’s outstanding shares as of this date, as we are currently aligned with the Board and Company management and wish to express our support for the Company and the Board. We intend to pursue our individual investment strategies and plan to do so without being constrained by the Company’s current poison pill.
Sincerely,
William Charters,
Stephen Salvadore,
Aurora Salvadore,
Barbara Salvadore, and
Gary Wyetzner
Source:
https://www.sec.gov/Archives/edgar/data/716643/000093583624000483/regis13da.htm