Document:

Exhibit 10(m)

 

Execution Copy

 

April 23, 2012

 

Regis Corporation

7201 Metro Boulevard

Minneapolis, Minnesota 55439

 

Re: Amendment No. 8 to Amended and Restated Private Shelf Agreement

 

Ladies and Gentlemen:

 

We refer to the Amended and Restated Private Shelf Agreement dated as October 3, 2000, as amended by the letter amendment dated as of May 9, 2002, Letter Amendment No. 2 to Amended and Restated Private Shelf Agreement dated as of February 28, 2003, the letter amendment dated April 29, 2005, the letter amendment dated July 6, 2006, the letter amendment dated July 31, 2007, Amendment No. 6 thereto dated as of July 3, 2009 and Amendment No. 7 thereto dated as of January 12, 2011 (as so amended, the “Shelf Agreement”), between Regis Corporation, a Minnesota corporation (the “Company”), on the one hand, and Prudential Investment Management, Inc. (“PIM”), The Prudential Insurance Company of America, Pruco Life Insurance Company, Pruco Life Insurance Company of New Jersey and the other “Prudential Affiliates” which pursuant to the terms thereof have become bound by certain provisions thereof, on the other hand.  Unless otherwise defined herein, the terms defined in the Shelf Agreement shall be used herein as therein defined.

 

Pursuant to the request of the Company and in accordance with the provisions of paragraph 11C of the Shelf Agreement, the parties hereto agree as follows:

 

SECTION 1.        Amendment.  From and after the Effective Date, the Shelf Agreement and the Notes are amended as follows:

 

1.1.         Paragraph 6B of the Shelf Agreement is hereby amended and restated in its entirety to read as follows:

 

“6B.        Minimum Net Worth.  The Company shall not, as of the last day of any fiscal quarter,  permit its Net Worth to be less than the sum of (i) $850,000,000 plus (ii) on a cumulative basis, 25% of the positive net income earned during each fiscal quarter commencing on or after April 1, 2011 plus (iii) on a cumulative basis, 50% of the net cash proceeds received from the issuance of equity securities of the Company after June 30, 2011.  As used herein, the term “Net Worth” means the shareholder’s equity of the Company as determined in accordance with generally accepted accounting principals consistently applied.”

 

 

1.2.         Paragraph 6C(1) of the Shelf Agreement is hereby amended by deleting the “and” at the end of clause (iii) thereof and replacing clause (iv) thereof with the following:

 

“(iv)        Liens securing Capital Lease Obligations in an aggregate outstanding amount not to exceed $50,000,000 at any time, provided such Liens attach only to the assets subject to the underlying capital lease, and provided further, that Priority Debt does not at any time exceed 20% of Net Worth determined as of the end of the most recently ended fiscal quarter; and

 

(v) Liens securing Indebtedness other than Capital Lease Obligations not otherwise permitted by clauses (i)-(iv) above, provided that (a) Priority Debt does not at any time exceed 20% of Net Worth determined as of the end of the most recently ended fiscal quarter; and (b) the aggregate amount of Indebtedness secured by Liens pursuant to this clause (v) shall not exceed four percent (4%) of Net Worth determined as of the end of the most recently ended fiscal quarter; and provided, further, that such Liens may not secure the Credit Agreement, the Term Loan Agreement or other Indebtedness to a bank, insurance company or other financial institution in excess of $20,000,000.”

 

1.3.         Paragraph 6C(2) of the Shelf Agreement is hereby amended and restated in its entirety to read as follows:

 

“6C(2).  Unsecured Subsidiary  Debt.             The Company shall not permit any Subsidiary to incur any unsecured Debt if after giving effect thereto Priority Debt would exceed 20% of Net Worth, determined as of the end of the most recently ended fiscal quarter.”

 

1.4.         Paragraph 6C(3) of the Shelf Agreement is hereby amended by amending and restating clause (vii) thereof to read as follows:

 

“(vii)       make or permit to remain outstanding other Investments (including Investments in Joint Ventures) in addition to the foregoing Investments permitted under this Section 6(C)(3); provided that (i) the aggregate amount thereof shall at no time exceed 30% of Consolidated Net Worth and (ii) the aggregate amount thereof made in or to Persons that are not in the same or similar line of business in which the Company and its Subsidiaries are engaged as of June 30, 2011 shall at no time exceed 10% of Consolidated Net Worth.”

 

1.5.         Paragraph 6C(4) of the Shelf Agreement is hereby amended and restated in its entirety to read as follows:

 

“6C(4).  Margin Regulations.  The Company shall not, whether directly or indirectly, and whether immediately, incidentally or ultimately, purchase or carry ay Margin Stock or extend credit to others for the purpose of purchasing or carrying Margin Stock.”

 

1.6.         Paragraph 6E of the Shelf Agreement is hereby amended by (i) replacing the phrase “any agreement creating or evidencing Indebtedness in excess of $15,000,000” with “any

 

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Material Debt Agreement” and (ii) adding a new sentence to the end thereof that reads as follows:

 

“For purposes of the foregoing, “Material Debt Agreement” means any agreement (or group of related agreements) under which the Company and/or any Subsidiary at any time incurs (directly, by assumption, by operation of law or otherwise) or has the right to incur (pursuant to committed financing) Indebtedness in excess of $50,000,000; provided that any such agreement (or group of related agreements) shall cease to be a Material Debt Agreement if the total amount of Indebtedness and unfunded commitments thereunder is permanently reduced to $30,000,000 or less.”

 

1.7.         Paragraph 6F of the Shelf Agreement is hereby amended and restated in its entirety to read as follows:

 

“6F.        Restricted Payments.  The Company shall not, and shall not permit any Subsidiary to, (i) declare or pay any dividend or make any other distribution (whether in cash, securities or other property) on any of its stock or other equity interests or any warrants, options or other rights with respect thereto (any of the foregoing, “Equity Interests”) or (ii) purchase, redeem or otherwise acquire for value any of its Equity Interests (any such declaration, payment, distribution, purchase, redemption or other acquisition, a “Restricted Payment”); provided that:

 

(i)            any Subsidiary may declare and pay dividends, and make other distributions, to the Company or any other Subsidiary;

 

(ii)           the Company may declare and pay stock dividends; and

 

(iii)          so long as no Default or Event of Default exists, the Company and its Subsidiaries may make other Restricted Payments; provided that if the Leverage Ratio as of the last day of the most recently ended fiscal quarter was greater than:

 

(1)           2.25 to 1.0 but equal to or less than 2.50 to 1.0, then neither the Company nor any Subsidiary will make any Restricted Payment pursuant to this clause (iii) if, after giving effect thereto, the aggregate amount of all such Restricted Payments made during the 12-month period ending on the date of such Restricted Payment would exceed $35,000,000; or

 

(2)           2.50 to 1.0, then neither the Company nor any Subsidiary will make any Restricted Payment pursuant to this clause (iii) if, after giving effect thereto, the aggregate amount of all such Restricted Payments made during the 12-month period ending on the date of such Restricted Payment would exceed $25,000,000.”

 

1.8.         Paragraph 8G of the Shelf Agreement is amended by adding the following to the end of the third sentence thereof:

 

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“(as such Schedule 8G may have been modified from time to time by written supplements thereto delivered by the Company and accepted in writing by Prudential)”

 

1.9.         Paragraph 8G of the Shelf Agreement is further amended by amending and restating the fourth sentence thereof to read as follows:

 

“The Company is not party to any agreement evidencing or pertaining to Debt of the Company in an outstanding or committed amount in excess of $20,000,000 which includes any operation or financial covenant which is more favorable to a lender or other beneficiary than those set forth in paragraph 6 hereof, except as set forth in the agreements listed on Schedule 8G-2 attached hereto (as such Schedule 8G-2 may have been modified from time to time by written supplements thereto delivered by the Company and accepted in writing by Prudential).”

 

1.10.       Paragraph 8G of the Shelf Agreement is further amended by replacing the reference to “paragraph 5F” in the last sentence thereof with “paragraph 6E”.

 

1.11.       Paragraph 10B of the Shelf Agreement is amended by adding, or amending and restating, as applicable, the following definitions in their entirety to read as follows:

 

“Credit Agreement” shall mean that certain Credit Agreement dated as of June 30, 2011 among the Company, various financial institutions, JPMorgan Chase Bank, N.A., as Administrative Agent, and the other agents named therein, as amended, supplemented or modified from time to time in accordance with the terms thereof.

 

“EBITDA” means, for any period, for the Company and its Subsidiaries on a consolidated basis, determined in accordance with generally accepted accounting principles, the total, without duplication, of

 

(a) net income (or net loss) for such period, excluding any gains or losses from sales of assets and any extraordinary non-cash gains or losses during such period (provided that the net income of any Person that is not a Subsidiary of the Company shall be included in the consolidated net income of the Company only to the extent of the amount of cash dividends or distributions paid by such Person to the Company or to a consolidated Subsidiary of the Company), plus

 

(b) to the extent included in the determination of such net income (or net loss), the sum, without duplication, of (i) all amounts treated as expenses for depreciation (including, without duplication, non-cash losses (net of non-cash gains) upon the closing and abandonment of any non-franchised store locations), plus (ii) all amounts treated as expenses for interest paid or accrued, plus (iii) all amounts treated as expenses for amortization of intangibles of any kind, plus (iv) all taxes paid or accrued and unpaid on or measured by income, plus (v) any non-cash interest expense on Indebtedness convertible into shares of common stock of the Company plus

 

(c) the amount of any other charge in respect of non-recurring expenses for such period arising in connection with acquisitions, to the extent approved by the Required Holders; plus

 

4

 

(d) up to $5,000,000 in the aggregate for such period of (i) non-recurring cash charges in connection with restructurings and (ii) external professional fees and diligence expenses relating to Acquisitions (whether or not consummated); plus

 

(e) if the Company or any Subsidiary acquires a Person (an “Acquired Person”) in an acquisition during such period, all of the Acquired Person’s EBITDA (calculated for such Person as set forth above without giving effect to clause (c)) for the four fiscal quarters then ended; minus

 

(f) if the Company or any Subsidiary sells all or substantially all of the stock or assets of any Subsidiary during such period, the EBITDA of such Subsidiary (calculated for such Person as set forth above without giving effect to clause (c)) for the four fiscal quarters then ended; plus

 

(g) all non-cash losses and expenses and non-cash impairment charges (including non-cash compensation expense and non-cash impairment of goodwill and other intangibles or arising in connection with any Joint Venture) to the extent deducted in determining such net income; minus

 

(h) all cash payments made during such period that arise out of non-cash losses or expenses and impairment charges taken in any previous period.

 

“Margin Stock” means “margin stock” as defined in paragraph 8I hereof.

 

“Rental Expense” means, for any period, the sum of (a) all store rental payments (excluding lease termination payments), (b) all common area maintenance payments and (c) all real estate taxes paid by the Company and its Subsidiaries, in each case, with respect to non-franchised store location (and not, for avoidance of doubt, with respect to office or warehouse locations).

 

1.12.       Paragraph 10C of the Shelf Agreement is amended by adding the following sentence to the end thereof:

 

“Notwithstanding any provision of this Agreement to the contrary, for purposes of this Agreement (other than covenants to deliver financial statements), the determination of whether a lease constitutes a capital lease or an operating lease and whether obligations arising under a lease are required to be capitalized on the balance sheet of the lessee thereunder and/or recognized as interest expense in the lessee’s financial statements shall be determined under generally accepted accounting principles in the United States as of June 30, 2011, notwithstanding any modifications or interpretive changes thereto that may occur thereafter.”

 

1.13.       Schedule 8A — Subsidiaries to the Shelf Agreement is deleted and Schedule 8A — Subsidiaries attached to this letter is substituted in lieu thereof.

 

1.14.       Schedule 8G — Agreements Restricting Debt to the Shelf Agreement is deleted and Schedule 8G — Agreements Restricting Debt attached to this letter is substituted in lieu thereof.

 

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1.15.       Schedule 8G-2 — More Restrictive Agreements is added to the Shelf Agreement in the form of Schedule 8G-2 — More Restrictive Agreements attached to this letter.

 

SECTION 2.        Conditions Precedent.  This letter shall become effective as of the date (the “Effective Date”) when the following conditions have been satisfied:

 

2.1.         Documents.  PIM and each holder of the Notes party hereto shall have received an original counterpart hereof duly executed by the Company, the Guarantors and the Required Holder(s) of the Notes of each Series.  The foregoing documentation should be returned to Prudential Capital Group, Two Prudential Plaza, Suite 5600, Chicago, Illinois, 60601-6716, Attention: Scott B. Barnett.

 

2.2.         Representations and Warranties; No Default.  To induce the holders of the Notes to execute and deliver this letter, the Company represents, warrants and covenants that (1) the execution and delivery of this letter has been duly authorized by all necessary corporate action on behalf of each Company and each Guarantor and this letter has been executed and delivered by a duly authorized officer of each Company and each Guarantor, and all necessary or required consents to and approvals of this letter have been obtained and are in full force and effect, (2) the representations and warranties contained in paragraph 8 of the Shelf Agreement shall be true on and as of the Effective Date, immediately before and after giving effect to the consummation of the transactions contemplated hereby, (3) the Shelf Agreement, as amended hereby, is the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms except as enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by the availability of the remedy of specific performance, (4) the Subsidiaries of the Company party to this letter represent all of the Subsidiaries of the Company that have joined the Guaranty Agreement (as defined in Section 4 below), and (5) there shall exist on the Effective Date no Event of Default or Default, immediately before and after giving effect to the consummation of the transactions contemplated hereby.

 

2.3.         Proceedings.  All corporate and other proceedings taken or to be taken in connection with the transactions contemplated hereby and all documents incident thereto shall be satisfactory in substance and form to the Required Holder(s) of each Series, and each holder of the Notes party hereto shall have received all such counterpart originals or certified or other copies of such documents as it may reasonably request.

 

SECTION 3.        Reference to and Effect on Shelf _Agreement.  Upon the effectiveness of this letter, each reference to the Shelf Agreement in any other document, instrument or agreement shall mean and be a reference to the Shelf Agreement as modified by this letter.  Except as specifically set forth in Section 1 hereof, the Shelf Agreement and the Notes shall remain in full force and effect and is hereby ratified and confirmed in all respects.  Except as specifically stated in this letter, the execution, delivery and effectiveness of this letter shall not (a) amend the Shelf Agreement or any Note, (b) operate as a waiver of any right, power or remedy of PIM or any holder of the Notes, or (c) constitute a waiver of, or consent to any departure from, any provision of the Shelf Agreement or any Note at any time.  The Company acknowledges and agrees that neither PIM nor any holder of any Note is under any duty or obligation of any kind or nature whatsoever to grant the Company any additional amendments or

 

6

 

waivers of any type, whether under the same or different circumstances, and no course of dealing or course of performance shall be deemed to have occurred as a result of the amendments and wavier herein.

 

SECTION 4.        Reaffirmation.  Each Guarantor (as defined in the Amended and Restated Subsidiary Guaranty dated February 23, 2003 (the “Guaranty Agreement”) by certain Subsidiaries of the Company in favor of the holders of the Notes) hereby ratifies and reaffirms all of its payment and performance obligations, contingent or otherwise, under the Guaranty Agreement. Each Guarantor hereby consents to the terms and conditions of this letter and reaffirms its obligations and liabilities under or with respect to the Shelf Agreement and the Notes, each as amended by this letter (including, without limitation, any additional Guaranteed Obligations (as defined in the Guaranty Agreement) resulting from this letter), and the Guaranty Agreement.  Each Guarantor acknowledges that the Guaranty Agreement remains in full force and effect and is hereby ratified and confirmed.  Without limiting the generality of the foregoing, each Guarantor agrees and confirms that the Guaranty Agreement continues to guaranty the Guaranteed Obligations arising under or in connection with the Shelf Agreement and the Notes, each as amended by this letter.  The execution of this letter shall not operate as a novation, waiver of any right, power or remedy of the holders of the Notes under the Guaranty Agreement.

 

SECTION 5.        Expenses.  The Company hereby confirms its obligations under the Shelf Agreement, whether or not the transactions hereby contemplated are consummated, to pay, promptly after request by any holder of the Notes, all reasonable out-of-pocket costs and expenses, including attorneys’ fees and expenses, incurred by any holder of the Notes in connection with this letter or the transactions contemplated hereby, in enforcing any rights under this letter, or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this letter or the transactions contemplated hereby.  The obligations of the Company under this Section 5 shall survive transfer by any holder of the Notes of any Note and payment of any Note.

 

SECTION 6.        Governing Law.  THIS LETTER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF ILLINOIS (EXCLUDING ANY CONFLICTS OF LAW RULES WHICH WOULD OTHERWISE CAUSE THIS AGREEMENT TO BE CONSTRUED OR ENFORCED IN ACCORDANCE WITH, OR THE RIGHTS OF THE PARTIES TO BE GOVERNED BY, THE LAWS OF ANY OTHER JURISDICTION).

 

SECTION 7.        Counterparts, Section Titles.  This letter may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which when taken together shall constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page to this letter by facsimile or electronic transmission shall be effective as delivery of a manually executed counterpart of this letter.  The section titles contained in this letter are and shall be without substance, meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto.

 

[signature pages follow]

 

7

 

	
 
    	
Very   truly yours,
    
	
 
    	
 
    
	
 
    	
PRUDENTIAL   INVESTMENT MANAGEMENT, INC.
    
	
 
    	
THE   PRUDENTIAL INSURANCE COMPANY OF AMERICA
    
	
 
    	
PRUCO   LIFE INSURANCE COMPANY
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Peter Pricco
    
	
 
    	
 
    	
Vice President
    

 

	
 
    	
RGA   REINSURANCE COMPANY
    
	
 
    	
MUTUAL   OF OMAHA INSURANCE COMPANY
    
	
 
    	
RELIASTAR   LIFE INSURANCE COMPANY
    
	
 
    	
UNION   SECURITY INSURANCE COMPANY
    
	
 
    	
PHYSICIANS   MUTUAL INSURANCE COMPANY
    
	
 
    	
FARMERS   NEW WORLD LIFE INSURANCE COMPANY
    
	
 
    	
ZURICH   AMERICAN INSURANCE COMPANY
    
	
 
    	
SECURITY   BENEFIT LIFE INSURANCE COMPANY, INC
    
	
 
    	
BAYSTATE   INVESTMENTS, LLC
    
	
 
    	
ING   LIFE INSURANCE AND ANNUITY COMPANY
    
	
 
    	
MEDICA   HEALTH PLANS
    
	
 
    	
MTL   INSURANCE COMPANY
    
	
 
    	
 
    
	
 
    	
By:
    	
Prudential   Private Placement Investors,
    
	
 
    	
 
    	
L.P.   (as Investment Advisor)
    
	
 
    	
 
    
	
 
    	
By:
    	
Prudential   Private Placement Investors, Inc.
    
	
 
    	
 
    	
(as   its General Partner)
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Peter Pricco
    
	
 
    	
 
    	
 
    	
Vice President
    
	
 
    	
 
    
	
 
    	
PRUDENTIAL RETIREMENT INSURANCE   AND ANNUITY COMPANY
    
	
 
    	
PRUDENTIAL ANNUITIES LIFE   ASSURANCE CORPORATION
    
	
 
    	
UNIVERSAL PRUDENTIAL ARIZONA   REINSURANCE COMPANY
    
	
 
    	
 
    
	
 
    	
By:
    	
Prudential   Investment Management, Inc.,
    
	
 
    	
 
    	
as   investment manager
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Peter Pricco
    
	
 
    	
 
    	
 
    	
Vice President
    

 

[Signature Page to Amendment No. 8 to Amended and Restated Private Shelf Agreement]

 

 

	
 
    	
GIBRALTAR   LIFE INSURANCE CO., LTD.
    
	
 
    	
 
    
	
 
    	
By:
    	
Prudential   Investment Management (Japan),
    
	
 
    	
 
    	
Inc.,   as Investment Manager
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
Prudential   Investment Management, Inc.,
    
	
 
    	
 
    	
as   Sub-Adviser
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Peter Pricco
    
	
 
    	
 
    	
 
    	
Vice President
    

 

[Signature Page to Amendment No. 8 to Amended and Restated Private Shelf Agreement]

 

 

Agreed as of the date first above written:

 

REGIS CORPORATION

REGIS INC.

HAIR CLUB FOR MEN, LLC

SUPERCUTS CORPORATE SHOPS, INC.

THE BARBERS HAIRSTYLING FOR MEN & WOMEN, INC.

REGIS CORP.

FIRST CHOICE HAIRCUTTERS (INTERNATIONAL) CORP.

 

	
By:   
    	
/s/   Brent Moen
    	
 
    
	
 
    	
Brent Moen
    	
 
    
	
 
    	
Chief Financial Officer
    	
 
    

 

[Signature Page to Amendment No. 8 to Amended and Restated Private Shelf Agreement]

 

 

SCHEDULE 8A

 

SUBSIDIARIES

 

	
Subsidiaries of
   Regis Corporation
    	
 
    	
Jurisdiction
    	
 
    	
% Ownership
   Structure
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
1.              The Barbers, Hairstyling for   Men & Women, Inc.
    	
 
    	
Minnesota
    	
 
    	
100.00%   Regis Corporation
    
	
A. WCH, Inc.*
    	
 
    	
Minnesota
    	
 
    	
100.00%   The Barbers, Hairstyling for Men & Women, Inc.
    
	
1. We Care Hair Realty, Inc.*
    	
 
    	
Delaware
    	
 
    	
100.00%   WCH, Inc.
    
	
B. Roosters MGC International LLC
    	
 
    	
Michigan
    	
 
    	
  60.00%   The Barbers, Hairstyling for Men & Women, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
2.              Supercuts, Inc.
    	
 
    	
Delaware
    	
 
    	
100.00%   Regis Corporation
    
	
A. Supercuts Corporate Shops, Inc.
    	
 
    	
Delaware
    	
 
    	
100.00%   Supercuts, Inc.
    
	
1. Tulsa’s Best Haircut LLC
    	
 
    	
Oklahoma
    	
 
    	
  50.00%   Supercuts Corporate Shops, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
3.              RPC Acquisition Corp.
    	
 
    	
Minnesota
    	
 
    	
100.00%   Regis Corporation
    
	
A. RPC Corporate Shops, Inc.
    	
 
    	
Minnesota
    	
 
    	
100%   RPC Acquisition Corp
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
4.              Regis Corp.
    	
 
    	
Minnesota
    	
 
    	
100.00%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
5.              Regis Insurance Group, Inc.
    	
 
    	
Vermont
    	
 
    	
100.00%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
6.              Regis, Inc.
    	
 
    	
Minnesota
    	
 
    	
100.00%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
7.              First Choice Haircutters International   Corp.
    	
 
    	
Delaware
    	
 
    	
100.00%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
8.              Cutco Acquisition Corp.
    	
 
    	
Minnesota
    	
 
    	
100.00%   Regis Corporation
    
	
A. Great Expectations Precision Haircutters Of Evans Towne   Center, Inc*
    	
 
    	
 
    	
 
    	
100.00%   Cutco Acquisition Corp.
    
	
B. Great Expectations Precision Haircutters of Northlake   Mall, Inc*
    	
 
    	
 
    	
 
    	
100.00%   Cutco Acquisition Corp.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
9.              Regis International Ltd.
    	
 
    	
Minnesota
    	
 
    	
100.00%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
10.       N.A.H.C.   Acquisition LLC*
    	
 
    	
Minnesota
    	
 
    	
100.00% Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
11.       EEG, Inc.
    	
 
    	
Delaware
    	
 
    	
55.10%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
12.       HC (USA), Inc.
    	
 
    	
Delaware
    	
 
    	
100.00%   Regis Corporation
    
	
1. HCM Industries, Inc.
    	
 
    	
Florida
    	
 
    	
100.00%   HC (USA), Inc.
    
	
2. Hair Club for Men, Ltd., Inc.
    	
 
    	
Florida
    	
 
    	
100.00%   HC (USA), Inc.
    
	
a. Hair Club for Men, LLC
    	
 
    	
Delaware
    	
 
    	
100.00%   Hair Club for Men, Ltd., Inc.
    
	
i. HCMG, LLC
    	
 
    	
Delaware
    	
 
    	
100.00%   Hair Club for Men, LLC
    
	
b. HCA Advertising Services, Inc.
    	
 
    	
New   York
    	
 
    	
100.00%   Hair Club for Men, Ltd., Inc.
    
	
c. Hair Club for Men, Ltd.
    	
 
    	
Delaware
    	
 
    	
100.00%   Hair Club for Men, Ltd., Inc.
    
	
d. 3115038 Canada, Inc.
    	
 
    	
Canada   Federal
    	
 
    	
100.00%   Hair Club for Men, Ltd., Inc.
    
	
e. Hair Club for Men, Ltd.
    	
 
    	
Illinois
    	
 
    	
  50.00%   Hair Club for Men, Ltd., Inc.
    
	
f. Hair Club for Men of Milwaukee, Ltd.
    	
 
    	
Wisconsin
    	
 
    	
  50.00%   Hair Club for Men, Ltd., Inc.
    
	
g. TTEM, LLC*
    	
 
    	
Delaware
    	
 
    	
100.00%   Hair Club for Men, Ltd., Inc.
    
	
h. HCMA Staffing, LLC
    	
 
    	
Delaware
    	
 
    	
100.00%   Hair Club for Men, Ltd., Inc.
    

 

 

	
Subsidiaries of
   Regis Corporation
    	
 
    	
Jurisdiction
    	
 
    	
% Ownership
   Structure
    
	
i. 8045950 Canada, Inc.
    	
 
    	
Canada   Federal
    	
 
    	
100.00%   HCMA Staffing, LLC
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
13.       Salon Management Corporation  
    	
 
    	
California   
    	
 
    	
100.00%   Regis Corporation
    
	
A.         Salon Management   Corporation of New York*
    	
 
    	
New   York
    	
 
    	
100.00%   Salon Management Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
14.       Regis Netherlands, Inc
    	
 
    	
Minnesota
    	
 
    	
100.00%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
15.       Roger Merger Subco LLC
    	
 
    	
Delaware
    	
 
    	
100.00%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
16.       RGS International SNC
    	
 
    	
Luxemburg
    	
 
    	
   99.99%   Regis Corporation
    
	
 
    	
 
    	
 
    	
 
    	
   00.01%   Roger Merger Subco, LLC
    
	
A. Regis International Holdings SARL
    	
 
    	
Luxemburg
    	
 
    	
100.00%   RGS International SNC
    
	
1. Regis Holdings (Canada), Ltd
    	
 
    	
Nova   Scotia
    	
 
    	
100.00%   Regis International Holdings SARL
    
	
a. First Choice Haircutters, Ltd
    	
 
    	
Nova   Scotia
    	
 
    	
100.00%   Regis Holdings (Canada), Ltd
    
	
b. Magicuts, Ltd
    	
 
    	
Nova   Scotia
    	
 
    	
100.00%   Regis Holdings (Canada), Ltd
    
	
2. RHS UK Holdings Ltd*
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   Regis International Holdings SARL
    
	
a. Haircare Ltd*
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   RHS UK Holdings Ltd
    
	
1. Haircare Gmbh
    	
 
    	
Germany
    	
 
    	
100.00%   Haircare Ltd
    
	
2. York Ave Beauty Salons
    	
 
    	
Canada
    	
 
    	
  50.00%   Haircare Ltd
    
	
3. Sagestyle Ltd*
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   Haircare Ltd
    
	
4. Haircare UK Ltd*
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   Haircare Ltd
    
	
5. Regis UK Limited
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   Haircare Ltd
    
	
i. 8 Inactive Subsidiaries*
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   Regis UK Limited
    
	
ii. Blinkers Group, Ltd*
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   Regis UK Limited
    
	
A.   Blinkers Property, Ltd*
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   Blinkers Group, Ltd
    
	
b. HCUK Hair, Ltd*
    	
 
    	
United   Kingdom
    	
 
    	
100.00%   RHS UK Holdings Ltd
    
	
3. Regis Merger SARL
    	
 
    	
Luxemburg
    	
 
    	
100.00%   Regis International SNC
    
	
a. Provalliance, SAS
    	
 
    	
France
    	
 
    	
29.76%   Regis Merger SARL
    
	
b. Provost   Participations SAS
    	
 
    	
France
    	
 
    	
24.23%   Regis Merger SARL
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
17.       Mark Anthony, Inc.
    	
 
    	
North   Carolina
    	
 
    	
100.00%   Regis Corporation
    

 

*Inactive Entities

 

[Signature Page to Amendment No. 8 to Amended and Restated Private Shelf Agreement]

 

 

SCHEDULE 8G

 

AGREEMENTS RESTRICTING DEBT

 

 

Fourth Amended and Restated Credit Agreement

Dated as of June 30, 2011

 

Among

 

Regis Corporation,

JPMorgan Chase Bank, N.A., Bank of America, N.A., The Bank of Tokyo-Mitsubishi UFJ, Ltd., U.S. Bank National Association, Wells Fargo Bank, N.A., Fifth Third Bank, PNC Bank, N.A., Royal Bank of Canada

 

 

SCHEDULE 8G-2

 

MORE RESTRICTIVE AGREEMENTS

 

 

Fourth Amended and Restated Credit Agreement

Dated as of June 30, 2011

 

Among

 

Regis Corporation,

JPMorgan Chase Bank, N.A., Bank of America, N.A., The Bank of Tokyo-Mitsubishi UFJ, Ltd., U.S. Bank National Association, Wells Fargo Bank, N.A., Fifth Third Bank, PNC Bank, N.A., Royal Bank of CanadaExhibit 10.(bb)

 

SEPARATION AND NON-DISPARAGEMENT AGREEMENT AND GENERAL RELEASE

 

	
TO:
    	
David   Bortnem
    	
 
    
	
 
    	
 
    	
 
    
	
FROM:
    	
Regis   Corporation
    	
VIA EXPRESS COURIER
    
	
 
    	
 
    	
 
    
	
DATE:
    	
April 23,   2012
    	
 
    

 

Please read this document carefully.  You are giving up certain legal claims that you might have against Regis Corporation by signing this agreement.  You are advised to consult an attorney before signing this agreement.

 

This agreement sets out the terms of your separation from Regis Corporation (“Regis”).  Under the agreement, Regis will provide you with extra benefits in exchange for your agreement to waive and release certain past or present legal claims you may have against Regis.

 

TERMS OF AGREEMENT

 

1.                                      Termination.  Regis has terminated your employment effective on January 19, 2012.

 

2.                                      Compensation and Benefits.  This agreement terminates the Employer/Employee relationship between you and Regis and closes out past or present claims as set forth in this agreement that you might have against Regis arising from that relationship.  In return for your release of claims, the agreement provides you with benefits to which you otherwise would not be entitled.  Accordingly, you and Regis agree as follows:

 

a.                                      Whether or not you sign this agreement, Regis will pay you:

 

1)                                     All compensation you have earned through and including the last day of your employment;

 

2)                                     Any accrued but unused PTO benefit; and

 

3)                                     Vested profit sharing, deferred compensation and 401(k) benefits in accordance with the terms and conditions of those plans.

 

By signing this agreement, you agree that you have already been paid all of these sums, specifically including all of your wages and benefits due to you as a result of your employment with Regis and that no other sums are due to you as a result of your employment.  Even if you do not sign this agreement, you can elect the period of continued health benefits coverage to which you are entitled under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”).  A separate COBRA notice is being sent to you.

 

b.                                      In exchange for the General Release set forth below, Regis agrees to provide:

 

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1)                                     Severance pay in the gross amount of Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00), representing 12 months of Employee’s base compensation, less statutory payroll deductions and other legally required withholdings; no deductions or withholdings will be made for contributions to employment plans such as 401(k) or any employee stock purchase plan.  Regis shall issue an IRS Form W-2 for the full amount of this payment.

 

2)                                     One payment in the gross amount of Thirty Thousand Two Hundred Five and 63/100 Dollars ($30,205.63) representing the cost of COBRA payments for medical, dental and life insurance for a period of 18 months.  This benefit is taxable and will be grossed up for the related taxes.  Regis shall issue an IRS Form W-2 for the full amount of this payment.

 

3)                                     Any officer bonus earned in FY12, prorated for a period of 7 months.  Payment shall be made at the same time bonus payments are customarily made to officers.  Payment shall be subject to all statutory deductions and other legally required withholdings.  Regis shall issue an IRS Form W-2 for the full amount of this payment.

 

4)                                     One payment in the gross amount of Thirty-One Thousand Eight Hundred Eighty and 00/100 Dollars, less statutory payroll deductions and other legally required withholdings, representing Employee’s Officer perquisites account for 12 months reduced by the value of Employee’s automobile lease from January 19, 2012 to November 30, 2012.  This benefit is taxable and will be grossed up for the related taxes.  Regis shall issue an IRS Form W-2 for the full amount of this payment.

 

5)                                     Continued use of Employee’s leased vehicle through lease end, November 30, 2012.  This benefit, has a value of Eleven Thousand Five Hundred Ninety and 00/100 Dollars ($11,590.00) is taxable and will be grossed up for the related taxes. Regis shall issue an IRS Form W-2 for the full amount of this payment.

 

6)                                     One payment in the gross amount of Seven Thousand and 00/100 ($7,000.00) representing one year of executive medical coverage.  This benefit is taxable and will be grossed up for the related taxes.  Regis shall issue an IRS Form W-2 for the full amount of this payment.

 

7)                                     One payment in the gross amount of Twenty-Thousand and 00/100 Dollars ($20,000.00) to be used at employee’s discretion for outplacement services.  This amount shall be subject to statutory payroll deductions and other legally required withholdings.  Regis shall issue an IRS Form W-2 for the full amount of this payment.

 

8)                                     One payment in the gross amount of Six Hundred and 00/100 ($600.00) to be used at employee’s discretion for professional fees for review of the agreement and release.  This amount shall be subject to statutory payroll deductions and other legally required withholdings.  Regis shall issue an IRS Form W-2 for the full amount of this payment.

 

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Except as otherwise indicated, the above payments shall be made to you in a single lump sum within ten (10) business days after all of the following have occurred: (a) receipt by Regis of the signed agreements; and (b) expiration of the rescission periods referred to in paragraphs 8 and 9.

 

If you do not sign this agreement or if you sign and rescind this agreement, you will not receive the Total Payment referred to in this subparagraph b.  If you sign and do not rescind this agreement, you agree that the Total Payment fully and adequately compensates you for everything released in this agreement.

 

3.                                      General Release.  In exchange for the benefits promised you in this agreement, you agree to irrevocably and unconditionally release and discharge Regis, its predecessors, successors, and assigns, as well as past and present officers, directors, employees, and agents, from any and all claims, liabilities, or promises, whether known or unknown, arising out of or relating to your employment with Regis through the date you sign this agreement.  You waive these claims on behalf of yourself and your heirs, assigns, and anyone making a claim through you.  The claims waived and discharged include, but are not limited to:

 

a.                                      Employment discrimination claims (including claims for harassment) and retaliation claims under Title VII of the Civil Rights Act of 1964 or other similar laws;

 

b.                                      Age discrimination claims under the Age Discrimination in Employment Act or similar discrimination act under any unit of federal, state, or local government;

 

c.                                       Any claim under the Minnesota Human Rights Act or similar discrimination act under any unit of federal, state, or local government;

 

d.                                      Any claim for whistleblowing, public policy, retaliation, or other similar law;

 

e.                                       Wrongful discharge and/or breach of contract claims;

 

f.                                        Tort claims, including but not limited to invasion of privacy, defamation, negligence of any kind, fraud, and infliction of emotional distress; and

 

g.                                       Any other statutory (including federal, any state, local, or other unit of government), common law, contract, or tort claims concerning your employment with Regis, including but not limited to claims under the Equal Pay Act, the Family and Medical Leave Act, the Americans with Disabilities Act, the Civil Rights Act of 1991, the Sarbanes Oxley Act, and 42 U.S.C. §§ 1981, 1983, or 1985, to the full extent such claims can be waived.

 

This release does not include claims that cannot, by law, be waived, such as unemployment compensation.

 

4.                                      Confidentiality and Non-Disparagement.  To the fullest extent permitted by law, you will not, directly or indirectly, disclose the terms of this agreement to anyone other than your attorney, spouse, or significant other, or except as required for accounting, tax, or other legally-mandated or legally-

 

3

 

permitted purposes, provided that, unless there is a legal reason for the disclosure, any such person to whom disclosure is made shall, prior to disclosure, specifically agree to keep this agreement confidential.  To the fullest extent permitted by law, you also agree not to make or endorse any disparaging or negative remarks or statements (whether oral, written, or otherwise) concerning Regis or its predecessors, successors, and/or assigns, as well as past and present officers, directors, agents, and/or employees.

 

5.                                      Non-Compete Agreement.  Employee expressly agrees, as a condition to the performance by Regis of its obligations hereunder, that for a period of 24 months following Employee’s separation from service with Regis and its affiliates, Employee will not, directly or indirectly, be involved in the ownership, operation or franchising of any licensed beauty salon(s), nor will employee consult with or for any person or entity with respect to the operation, ownership or franchising of any licensed beauty salon(s).

 

6.                                      Binding Nature of Agreement.  This agreement is binding on the parties and their heirs, administrators, representatives, executors, successors, and assigns.

 

7.                                      Return of Corporate Property.  By signing below, you represent and warrant that all Regis property has been returned to Regis, and that you have not retained any copies, electronic or otherwise, of any Regis property.  Notwithstanding this paragraph of this agreement, you may keep documents pertaining to your compensation and/or benefits.

 

8.                                      Compliance with the Age Discrimination in Employment Act (“ADEA”) and Notice of Right to Consider and Rescind Agreement. You understand that this Agreement has to meet certain requirements to validly release any claims you might have under the ADEA (including under the Older Workers’ Benefit Protection Act), and you represent that all such requirements have been satisfied, including that:

 

a.                                      The agreement is written in a manner that is understandable to you;

 

b.                                      You are specifically waiving ADEA rights;

 

c.                                       You are not waiving ADEA rights arising after the date of your signing this agreement;

 

d.                                      You are receiving valuable consideration in exchange for execution of this agreement that you would not otherwise be entitled to receive;

 

e.                                       Regis is hereby, in writing, encouraging you to consult with an attorney before signing this agreement; and

 

f.                                        You received 21 days to consider this Agreement and at least 7 days to rescind it (you are actually receiving 15 days to rescind).

 

9.                                      Compliance with the Minnesota Human Rights Act and Notice of Right to Consider and Rescind Agreement.  Regis hereby advises Employee to consult with an attorney of his/her choice before signing this agreement releasing any rights or claims that he/she believes he/she may have under the Minnesota Human Rights Act (MHRA).  Once this Separation Agreement is executed, 

 

4

 

Employee may rescind this Separation Agreement within fifteen (15) calendar days to reinstate any claims under the MHRA.  To be effective, any rescission within the relevant time period must be in writing and delivered to Employer, in care of Ms. Katherine M. Merrill, 7201 Metro Boulevard, Minneapolis, MN 55439 by hand or by mail within the fifteen (15) day period.  If delivered by mail, the rescission must be (1) postmarked within the fifteen (15) day period; (2) properly addressed to Employer; and (3) sent by certified mail, return receipt requested.

 

10.                               No Unlawful Restriction.  You understand that nothing in this agreement is intended to or shall: (a) impose any condition, penalty, or other limitation affecting your right to challenge this agreement; (b) constitute an unlawful release of any of your rights; or (c) prevent or interfere with your ability and/or right to: (1) provide truthful testimony if under subpoena to do so; (2) file any charge with or participate in any investigation or proceeding conducted by the Equal Employment Opportunity Commission or any other federal, state, and/or local governmental entity; and/or (3) respond as otherwise provided by law.

 

11.                               Severability.  The provisions of this agreement are severable.  If any provision (excluding the General Release above) is held to be invalid or unenforceable, it shall not affect the validity or enforceability of any other provision.

 

12.                               Entire Agreement.  Except to the extent that you have an arbitration agreement with Regis, this agreement sets out the entire agreement between you and Regis and supersedes any and all prior oral or written agreements or understandings between you and Regis concerning your termination of employment.  Any arbitration agreement that you have with Regis will continue in full force and effect.

 

13.                               Employee Representations.  You represent that you:

 

a.                                      you have the right and we have encouraged you to review all aspects of this agreement with an attorney of your choice;

 

b.                                      have had the opportunity to consult with an attorney of your choice and have either done so or freely chosen not to do so;

 

c.                                       have carefully read and fully understand all the provisions of this agreement; and

 

d.                                      are freely, knowingly, and voluntarily entering into this Separation and Non-Disparagement Agreement and General Release.

 

14.                               Effective Date of Agreement.  This agreement will become effective on the sixteenth day after you sign it, provided that you have not rescinded the agreement.

 

15.                               Valid Agreement.  As stated above, you agree that this agreement and its releases fully comply with the ADEA.  You also agree that this agreement and its releases fully comply with the Minnesota Human Rights Act, and all other laws, statutes, ordinances, regulations, and/or principles of common law governing releases.

 

5

 

16.                               No Admission of Liability.  Regis denies any and all liability to you.  You understand and agree that this agreement is not an admission of wrongdoing or liability, including, but not limited to, any violation of any federal, state, and/or local law, statute, ordinance, contract, and/or principle of common law by Regis and/or any individuals and/or entities associated with Regis.

 

17.                               Attorneys’ Fees.  You agree that you are responsible for your own attorneys’ fees and costs, if any, incurred in any respect, including but not limited to in connection: with your employment with Regis; with the termination of your employment with Regis; and with negotiating and executing this agreement.

 

18.                               Governing Law.  This agreement shall be construed and enforced in accordance with the laws of the State of Minnesota and the laws of the United States, where applicable.

 

IN WITNESS WHEREOF, the parties hereto have executed this Separation and Non-Disparagement Agreement and General Release as of the day and year first above written.

 

 

	
Dated:
    	
May   9, 2012
    	
 
    	
/s/   David Bortnem
    
	
 
    	
 
    	
Employee   (print name):
    	
David   Bortnem
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
REGIS   CORPORATION:
    
	
 
    	
 
    	
 
    
	
Dated:
    	
May   10, 2012
    	
 
    	
By:
    	
/s/   Katherine Merrill
    
	
 
    	
 
    	
 
    	
 
    	
Its:
    	
Vice   President, Law
    
										

 

6

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