Hugh Sawyer Regis Corp.
Total compensation: $3,078,332 for the year ended June 30, 2018
Nonequity incentive pay: $1,966,500
Other compensation: $161,832
Total fiscal 2018 shareholder return: 61.1 percent
CEO pay ratio: 146:1
Median employee pay: $21,034
Note: In an unusual move, the seven independent directors of Regis Corp. collectively wrote the letter to shareholders in this year's proxy statement. The letter's focus was more disclosure of their new "like-no-other, designed-from-scratch compensation plan."
The Edina-based hair-salon company is in the midst of a strategic shift that is focused on its franchised salons. With that shift comes a new compensation plan that the board claims strongly encourages executives to buy shares of Regis with their own money and has a longer-term focus. That plan goes into effect for fiscal 2019.
The plan differs from typical executive-compensation plans that rely on large annual grants of long-term equity awards such as stock options and restricted share awards. Under the new plan, executives will still be awarded long-term equity awards every five years, but they can elect to annually contribute up to half their earned short-term bonus to buy common shares and receive matching grants of restricted stock awards. The plan was structured in such a way that if executives elect not to participate they would earn less than what the old plan would have provided, but if they participate fully they can earn much more.
Sawyer's compensation for fiscal 2018 was based on the old plan and the multiyear employment agreement that was effective when signed as president and CEO in 2017. His fiscal 2018 compensation included salary and annual cash incentives; he did not receive any new long-term equity awards based on his employment agreement that included a $585,000 sign-on bonus; and $5 million worth of long-term equity awards. His $2 million cash incentive award for fiscal 2018 was based on the company's performance.