Daniel J. Hanrahan - Chief Executive Officer, President and Director Steven M. Spiegel - Chief Financial Officer and Executive Vice President

Paul Alexander - BofA Merrill Lynch, Research Division Jeffrey S. Stein - Northcoast Research William R. Armstrong - CL King & Associates, Inc., Research Division Jill R. Caruthers - Johnson Rice & Company, L.L.C., Research Division

Good morning. My name is George, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the Regis Corporation Fiscal 2014 Third Quarter earnings call. [Operator Instructions] If anyone has not received a copy of today's press release, please call Regis Corp. at (952) 806-2154 and a copy will be faxed to you immediately. If you wish to access the replay for this call, you may do so by dialing (800) 406-7325, using the access code of 4679962 followed by the # sign. The replay will be available 60 minutes after the conclusion of today's call. I would like to remind everyone that to the extent the company's statements or comments this morning represent forward-looking statements, I refer you to the risk factors and other cautionary factors in today's news release, as well as the company's SEC filings. Reconciliation to non-GAAP financial measures mentioned in the following presentation, as well as others, can be found on their website at www.regiscorp.com. Speaking today will be Dan Hanrahan, Chief Executive Officer; and Steve Spiegel, Chief Financial Officer. After management has completed its review of the quarter, we will open the call for questions. [Operator Instructions] I'd now like to turn the call over to Mr. Hanrahan for his comments. Dan, you may begin. Daniel J. Hanrahan: Thank you, George. Good morning, and thank you, everyone, for joining us today. With me are Steve Spiegel, our Executive Vice President and Chief Financial Officer; Eric Bakken, our Executive Vice President and Chief Administrative Officer; and Mark Fosland, our Senior Vice President of Finance. Before we begin our discussion, I'm excited to share with you the new look and feel of Regis that you see on the screen. We are a company that is focused on the development and success of our people. I know all companies depend on their people and my statement is a bit obvious. However, our people are truly our great asset, because without them, we cannot deliver our product, which is service to millions of guests. This new look and feel present the compelling image of the people we depend upon for our success. It also demonstrates the energy and enthusiasm they have for this company. We will incorporate this imagery into our communications, including one of our most important recruiting materials. As I've said in the past, our employees are our most important asset, and building a winning organization through developing your talent is key to our success. Today, I want to talk about people, process and metrics, and what we are doing to improve in each of these areas. They are completely interrelated, and we need all 3 firing in a market or salon to drive execution and results. Before I begin that discussion, I would like to put in perspective the path Regis has traveled during the past couple of years, and most specifically since I joined. Doing so helps explain where we are in our turn around, where we are headed and what we need to do. Our journey began with a proxy contest in November 2011 that provided the catalyst for much-needed change at Regis. A transition period ensued that concluded with my joining Regis in August 2012. As an aside, I continue to feel very fortunate to have this opportunity. Unlike the experience of many CEOs who sign up for transformational change, I partnered with a supportive board who recognized our need to move patiently, to ensure we understood the business before executing a new strategy. I spent the remainder of 2012 and the first part of 2013 working with our best operators to thoughtfully evaluate the business and develop the vision, mission and strategies to position Regis for long-term success. I refer to this as our discovery phase. I quickly recognize I was fortunate to inherit many talented and passionate leaders throughout the organization, who were and are today committed to turning Regis around. I met countless salon managers and stylists committed to delivering a great guest experience. I assessed and promoted the Regional Vice Presidents leading our field operations today. And I work every day here at Salon Support with very talented people, many of whom have long tenures with Regis. However, in a number of very key areas I found there was tremendous opportunity, as many of the cupboards were bare. We did not have a Human Resources department. Our salons did not have Internet connectivity or a POS system that would allow us to effectively manage salons or leverage the many guest relationship management opportunities, Heather Passe, our Chief Marketing Officer, and her team are building. We did not have standard operating procedures across brands. There was not an effective loss prevention program, and the branded approach of salon management resulted in a lack of leadership and support at the salon level. We have gone after each of these opportunities vigorously, to position Regis for future success. On a parallel path, we recruited a senior leadership team to help us develop these areas. The discovery period made it clear to me transformational changes were necessary to lay foundation to enable Regis to become a high performance organization. Getting the foundation right is crucial to making people process and metrics work. What I want to do now is walk you through the work we have done to begin to bring people, process and metrics together to drive execution and results. Let me start with process and metrics, as I want to finish with people and show how our best leaders are using the tools we are giving them to drive those results. During -- in the third quarter of this fiscal year, we began transitioning from disruption, caused by foundational change, to execution. We are admittedly at the very beginning, but where our talented leaders are using the tools we have provided, we are seeing signs of traction. During our past several calls, we discussed in detail challenges experienced rolling out SuperSalon to all of our North American Salons. We completed the rollout late last summer. Since that time, we've been focused on improving performance and usability in the salon. Much of which was completed during the current quarter. For the first time since the rollout, I can say SuperSalon is no longer an impediment to our business. Tools that enable sound salon management like opening and closeout reports are available and working. Credit card transactions process at industry standards. Functional enhancements have been made to enable efficient transacting in the salon. In a recently completed survey of our salons, over 90% of them gave SuperSalon passing grades. This is not to suggest we have solved all issues or we are leveraging all of SuperSalons capabilities. But comfortable adoption of the platform becoming a less significant issue, we can begin to focus on obtaining benefits from technology like best-in-class operators. Again, stressing the importance of the interaction of systems with people, current efforts are focused on moving from passing to high grades. Let me put it this way, we are pleased but not satisfied. The IT department's priority is on constant improvement of the stylists and guest experience. Our focus is on simplifying and making our stylists' and salon managers' lives easier. However at the same time, we are preparing for the future. IT is also working hard to enhance salon level analytics and guest insights, enabling further focus on loss prevention and leveraging additional technology platforms that drive guest traffic. Benefits of technology will be fully realized when we have the right people executing clearly defined roles and responsibilities, using relevant metrics to guide them in their decision-making. Now onto our most important asset, people. As I said earlier, we had many talented leaders in the organization, and you can see this in the chart on your screen. But we also needed to build out a strong management team. In the past 24 months, we added a Chief Information Officer, Chief Marketing Officer, Chief Financial Officer, Chief Human Resources Officer, Chief Operating Officer and a Vice President, Asset Protection. Just this past October and November, we filled 2 critical leadership positions with the hires of Regis' first-ever Chief Human Resources Officer and a new Chief Operating Officer. With the exception of Eric Bakken, our very capable Chief Administration Officer, the entire leadership team is essentially new. I want to linger on this slide for a minute because I believe it's important to communicate what we did. Beyond Eric, we have a number of very talented leaders in the organization, including down in the ranks in the field. Many of these field leaders were promoted to Regional Vice President. We needed to bring in talented senior leaders to supplement the industry knowledge we had in the organization and the field, to drive clarity, to drive role clarity beyond our standard operating procedure -- build our standard operation procedures across our 7,000 salons and drive best practices for managing and executing in a multiunit environment. We now have a leadership team with experience from companies like Allianz, Ameriprise, CBS, Delta, Gap, Target and Unilever. As a result, we have built a strong leadership team that is a mix of industry experience and best-in-class talent to drive the turnaround. Building out the leadership team has enabled us to embark on a constant state of improvement with our talent. We must be continually assessing, developing and upgrading our talent. To accomplish this, we need to put our people in the field and salons in a position to succeed, with clearly defined role expectations. We need to assess them against this role clarity to understand where the knowledge gaps are, and what training they need to be successful. The addition of Jim Lain and Carmen Theide allowed us to put this into action over the last quarter, and we are seeing results. Let me walk you through some examples of where this is working, and where we still have work to do. At the beginning of the third quarter, we targeted our worst-performing salons and sent Regional Directors into the salons with playbooks to turn the salon around in 3 days. The results were nothing short of phenomenal in a number of stores over those 3 days. This is an excellent example of the opportunity we have. It is also an excellent example of why people, process and metrics have to be aligned to drive results. Because not all of the regional directors fully comprehended their role in this effort, results slipped back after they moved on to the next salon. We proved we could significantly improve sales trends in these salons, but we did not sustain the strong momentum. Overall, these salons were better by almost 400 basis points, but not the same levels as when the Region Director were coaching and developing the salon, versus doing the work for the Salon Manager. The issue and the opportunity is role clarity. Many of the Region Directors do not fully understand their role and effectively coach and leave a sustainable salon. Here are 3 Regional Directors who understood their roles were to train and develop salons, and you can see a substantial difference in sustainability of results. Now let me show you one Regional Director who really gets their role and how to execute it. This regional Director took these concepts and executed across their entire portfolio, and is winning. While we have work to do to replicate these types of results across all of our regional directors, these cases demonstrate the types of success we can achieve when people have role clarity and act upon relevant information. This next slide is an example of what happens when our field team has clarity in what we expect in clear metrics that describe success. In the last call, we discussed our staffing issue. I'm pleased to report our organization responded quickly. Leveraging new reporting tools that provide early warnings of turnover by salon, regional directors worked with district leaders to evaluate our most problematic salons. District leaders teamed with Salon Managers and field human resources developed -- to develop specific hiring, execution of follow-up plans at these salons. We also began working more closely with Empire to utilize their investment as a source of new hires. It's gratifying to see results when our field team collaborates with HR to hit staffing goals. As we need stylists behind chairs to capture traffic and generate revenue. We expect these investments in stylists will improve our revenue-generating capability over time. Next, I want to talk to you about the latest addition to our leadership team. Our VP Asset Protection, Ken Warfield. In many companies, this is referred to as loss prevention. We call it asset protection as we are protecting our financial results, which in turn allows us to protect and invest in our most important asset, our people. This is an excellent example of where people, process and metrics are coming together to improve our revenue and EBITDA. Over the past 6 months, Steve Spiegel, our CFO, and Doug Reynolds, our Chief Information Officer, built a first-class exception reporting system to enable us to identify and broaden our salons. But we didn't have the right leader to put the processes in place and effectively use the metrics our systems were providing to create a positive culture of integrity and control. We have the right leader now and Ken is putting the process in place to create that impression of control. I won't get in the weeds on this, as we are very early. However, one quick story. Ken working with our field operations team recently caught a stylist stealing. During the interview she said, "I heard you are looking at this stuff now and figure you were going to catch me." As I said, we are early in developing processes to create the impression of control we need, but it's encouraging to see some early wins, and the asset protection message beginning to spread. Before I conclude, I would like to address our retail sales performance. Our retail sales remain challenged, and we are working diligently to address these trends. We continue to search for a new Chief Information -- Chief Merchandising officer. Like all the other areas of our business, getting the right people in place will make a difference. Leveraging great relationships with our vendor partners, we are focused on new product promotions and offerings that drive retail sales. The training and content changes we discussed last quarter are progressing, but it is too early to determine the effectiveness of these changes. We are executing against a solid -- a sound strategy that is focused on making it easy for our stylists to be successful in delivering an experience that creates guests for life. As we train and develop our field leaders, and provide process and relevant information to make sound decisions, we will see more of our districts come positively over time. The results may sputter for a while, but we expect them to ultimately deliver on a consistent basis. We are creating a constant improvement culture that is focused on people and process. We have the significant work to develop and upgrade our field talent, and we have more to do. But where we have top leaders bringing people, process and metrics together, we are delivering strong results. I know the burning question is how long will it take to turn 7,000 salons. I won't give an answer to that question, but I can tell you we have made significant progress in laying the foundation for the turnaround in the last 9 months since we reorganized field operations and finished installing SuperSalons. I'm proud of the work the team is doing to create the cultural transformation needed to turn Regis. Steve? Steven M. Spiegel: Thank you, Dan, and good morning. Before discussing our consolidated financial and operating performance for the third quarter, I want to address 2 housekeeping items. First, as a result of our field reorganization, District Leaders' labor costs are now reported within cost of service and their travel costs are now reported within site operating expenses. Previously, these costs were reported as general and administrative expenses. We included on our corporate website recasted historic annual and quarterly financial statements to better assist you with your comparisons. Second, because of the valuation allowance against most of our deferred tax assets, associated reported and as adjusted results of operations are not tax affected. Consequently, current period results are not comparable to tax affected prior periods. For the third quarter, Regis reported a net loss of $9.5 million or $0.17 per diluted share. Adjusted EBITDA for the quarter came in at $26 million compared to $26.8 million in the prior year quarter. Excluding net discrete charges, third quarter net loss -- net diluted net loss per share, as adjusted was $0.15 compared to earnings of $0.01 in the prior year quarter, declining by $0.16 per share. This decline includes negative noncash impacts of $0.07 per share, due to not recording a tax benefit and $0.07 per share relating to accelerated depreciation. The remaining $0.02 per share decline is comprised of $0.12 per share, associated with negative same-store sales, offset by $0.10 per share improvement on the cost side of our business. Cost improvement is primarily related to cost savings, reduced bonuses, improved cost of product, cost reductions related to our field reorganization, lower health care costs and lower marketing costs, partly offset by higher salon labor costs, relative to lower sales volumes. I will discuss these items in more detail shortly. We included in today's press release, as well as on our corporate website, a reconciliation that bridges reported results to earnings as adjusted for the impact of discrete items, with the third quarter of the current and prior years. Moving on to third quarter operating results. My comments this morning will focus on as adjusted results. References to prior year numbers will be on a recasted basis for our field reorganization. Revenue in the quarter of $471.6 million declined $33.4 million or 6.6% compared to the prior year quarter. Same-store sales declined 5.7% compared to the prior year quarter. We estimate the shift of Easter from March of last year to April of this year, negatively impacted same-store sales by approximately 70 basis points during the third quarter of the current year. We should see this impact reverse in our upcoming fourth quarter. Year-over-year, total company-owned store counts decreased by 216 locations. During the quarter, we built 33 company-owned salons, closed or relocated 98 other company-owned locations and sold 6 locations to franchisees. Service revenues were $367.2 million, a $24.9 million decline or 6.4% compared to the prior year quarter, mainly driven by declines in North American Salons. During the period, same-store service sales declined 4.9%, driven by a decline in guest traffic of 5.7%, partly offset by an increase in average ticket price of 0.8%. The remaining 150-basis-point decline in service revenues compared to the prior year quarter was primarily due to a net reduction in store counts, partly offset by 1 extra day during the current year quarter. Product revenues were $94.3 million, a decrease of $8.9 million or 8.6% compared to the prior year quarter. Product same-store sales declined 8.9%, representing 30 basis points of sequential trend improvement. As we look to the fourth quarter, we are lapping heavy clearance activity, which will make sales comparisons more difficult. This should be somewhat offset by year-over-year margin rate improvement. Royalties and fees were $10 million, an increase of $0.5 million or 4.8% compared to the prior year quarter. Our franchisees posted positive same-store sales during the quarter, and added 83 net locations in the last 12 months. In the quarter and last 12 months, we added 36 and 139 new franchisees to the system, respectively. Moving on to cost of sales. Cost of service and product as a percent of associated revenues improved 20 basis points compared to the prior year quarter, coming in at 59%. I will discuss this decrease in greater detail by reviewing service and product components. Cost of service, as a percent of service revenues for the quarter increased 50 basis points versus the prior year quarter, coming in at 61.6%. Negative leverage of stylist hours caused by same-store service sales declines were partly offset by lower levels of bonuses, cost savings derived from the field reorganization, lower health care costs and a mix shift into higher margin services. We also had the timing impact of Easter's holiday pay in the third quarter of last year that will occur in the fourth quarter of this year. Cost of product, as a percent of product revenues was 48.9%, a 270-basis-point improvement when compared to the prior year quarter. This improvement was mainly driven by a shift to higher margin products, promotional changes, lapping of clearance sales and reduced sales commissions. Site operating expenses of $50.2 million decreased $5.8 million compared to the prior year quarter. The decrease was primarily driven by cost savings initiatives to lower repairs, maintenance and travel expenses, combined with lower levels of marketing expense and reduced freight. General and administrative expenses of $42.5 million decreased $5.7 million compared to the prior year quarter. Approximately half of this improvement relates to cost savings initiatives and benefits from the field reorganization. The remaining improvement was derived from reduced bonus and health care costs. We continue to do a nice job managing our costs and remain focused on ways to simplify to drive further efficiencies. Let's now shift to liquidity. At March 31, 2014, we have $361 million of cash, total debt of $294 million and no outstanding borrowings under our $400 million revolving credit facility. Our business generated $34 million of operating cash flow during the quarter. Our $172.5 million par value 5% convertible debt matures on July 15, 2014. In accordance with the terms of the indenture, earlier this month, we notified note holders we would be settling this debt using a combination of cash and shares. Specifically, we committed to settle up to a maximum of $184 million of conversion value in cash and any an excess in shares. Following this settlement plan is consistent with our recently announced capital allocation policy, in that it puts a ceiling on our maximum cash obligation, minimizes dilution to existing shareholders and leaves us flexibility to repurchase shares to the extent conversion value exceeds $184 million. This concludes the financial portion of the call. We would now like to answer any questions you may have. Operator, can you please provide the instructions for the Q&A portion of the call?

[Operator Instructions] Our first question is from the line of Lorraine Hutchinson with Bank of America Merrill Lynch. Paul Alexander - BofA Merrill Lynch, Research Division: It's Paul Alexander for Lorraine. Dan, just, very big picture here. I think your tone is much more confident and positive today than it's been in recent quarters, but there is still some big similarities between this quarter and recent quarters. You're executing on your strategies, but things aren't totally filtering all the way down to the salon level yet, and it doesn't seem you're really seeing the traction yet. So can you explain a little more why you feel like you're now on the verge of going from transition to execution? When you see another quarter of one step forward in something positive, but then one step back, what gives you confidence that you're really closer to seeing the traction and meaningful improvement? Daniel J. Hanrahan: Good question. The -- and I think you've captured pretty well where we are. We know that we still have a great deal of work to do to turn the 7,000 salons and 50,000 stylists into the most productive group they can be. What makes us feel better about the strategy and that it's the right strategy, is where we do have good operators and very solid people executing against it. We're seeing the kind of results that I described in those couple of slides. What gives us pause and makes us know that we still have a lot of work to do is that we've got to execute that across the entire portfolio, and across all of our people. We've done an awful lot of work on assessing our talent. Having Carmen here has really been helpful. We've assessed all of our regional vice presidents, and put together development plans for them, to help them be better. We're doing the same thing at the regional director and the district leader level. So what I'm feeling better about is the fact that where, when we're assessing talent, we're assessing them against their ability to deliver that strategy, and if people have opportunity areas, we're putting plans together. So I don't want to get out over my skis by any stretch of the imagination, but I do feel good about the strategy, but I want you to understand that what we've got to do is be able to execute it across the entire portfolio. Paul Alexander - BofA Merrill Lynch, Research Division: Great. Just on that topic of people and cascading this role clarity and expectations down the line, you focused a little bit on cascading this communication down to district leaders and salon managers, how much longer does it then take to get down to the stylist level? Daniel J. Hanrahan: Well, I believe that once we get it to the salon manager level, and we get salon managers operating well, we're at the stylist level. Because all of our salon managers are there, shoulder to shoulder with stylists, cutting hair, and when we get to that point where we're all the way to salon managers were there, I would tell you that I feel very good about where we are with our regional vice president. I would say that we feel better about where we are with our regional directors -- still work to do. Where we haven't gotten all the way through is to our district leaders. And the reason I say that about the salon managers, we see that in our franchisees, where they've got, and they, for the most part, they have it in all their salons, where they have a really solid salon manager, they're clicking on all cylinders. And we see that. So when we've got the connection from regional vice president, all the way down to the salon, we're seeing terrific results. We just have to be able to execute that across the entire portfolio. Paul Alexander - BofA Merrill Lynch, Research Division: And then just one last follow-up. Any color on how visitation, or your comps trended throughout the quarter, month-to-month? Daniel J. Hanrahan: I'm sorry. Say that again? You lost me. Paul Alexander - BofA Merrill Lynch, Research Division: Do you have any color on how the sales trends sequentially went through the quarter? Daniel J. Hanrahan: No, we don't get into the month-to-month, Paul. I'm sorry, I misunderstood the question.

And our next question is from the line of Jeff Stein with Northcoast Research. Jeffrey S. Stein - Northcoast Research: Hey Dan, just following up on the last question. What percent of the portfolio is working right now? And how would that compare with where you were 3 months ago and 6 months ago? Daniel J. Hanrahan: Well, last quarter, we won't get -- I won't get into the specifics, Jeff, on that, but -- on the percentages. But I can tell you, the last quarter we described a fairly large number of district leaders that were performing positively. That same group was positive again in -- as a whole, and that, in our third quarter. Some of them more so than others. I think you can see by our results that we just don't have enough of our districts performing at a positive level. What we do see -- and I don't mean to sound like a broken record, but what we do see is where we've got good leadership in place over the salons, and we get the kind of results that we showed you in that one region, where the person running that region is up substantially. They've done a good job developing and upgrading their talent at the district leader level, and in turn, the district leaders that put all good salon managers in place. Our opportunity and it's our challenge as well, is to get our leadership in the field to execute effectively across their entire portfolio, and that's really around developing and upgrading their talent. Jeffrey S. Stein - Northcoast Research: Okay. Can you talk about the turnover at the stylist level? Has -- have you been able to slow that at all? And as you bring new stylists in, I would presume there's a learning curve before they may even be able to equal or exceed the productivity of the people they're replacing? Where are you there? Daniel J. Hanrahan: Yes, good question. Yes, on both counts. We have -- in the last call, we had talked about the challenges that we had in the fourth quarter, with stylist turnover. And then, in this prior quarter, we -- I'm really proud of the work the team did. I think Jim Lain and his regional vice president team, really got that message across, all the way through the system. And what we -- and I think what it shows is that where we get alignment on people, process and metrics, we can deliver. So we did a -- we outpaced our declines pretty substantially in, our departures, I'm sorry, pretty substantially in the prior -- in past quarter. And you're right, it does take some time for those people to get up to speed, and it's one of the reasons that Carmen and her team are very, very focused on developing a much more powerful training program, so that we can get those stylists up to speed more quickly. But we've done a good job hiring, but you are right, that a brand new stylist -- and it depends on if the stylist was experienced, or one coming right out of school, but in general, stylist coming right out of school is not as productive right off the bat as somebody that's been there for some time. Jeffrey S. Stein - Northcoast Research: Okay, and where are they primarily coming from? Are they coming from school, or are you hiring experienced stylists? Daniel J. Hanrahan: It's a mix. If we can hire -- if we have a choice between somebody right out of school or an experienced stylist, as long as there's a good cultural fit in the salon, we'll always take that experienced stylist, but we get them from both places. And it ebbs and it flows, and it depends upon where their school is in place. We worked -- we're working much harder, Jeff, with Empire Education Group, who is -- is a good partner of ours. We're, as you know, a part owner in that, but we've really worked hard on developing the relationship and becoming the place where their students go. And Eric, Eric sits on the board there, and we've got a great relationship with that group, and that's a gold mine for us, what we haven't mined very effectively in the past, that we're very focused on now. Jeffrey S. Stein - Northcoast Research: Okay, and I've got just one real quick question for Steve, and that is, your gross profit margins on the product side of 51%. I just wonder, you mentioned, Steve, that you expect your gross margins to be up in the fourth quarter because you're going up against liquidations last year. But with the sales trend you're seeing, how can you sustain margins at that level? And is it possible that, that's part of the problem, that you're just charging too much for your products? Steven M. Spiegel: Actually, I think the promotional activity that we did in the prior year was probably not driven by a sound return on investment philosophy. And in addition to that, because we were doing a lot of it in advance of resetting our planograms, it was significant in nature. And so I don't believe that, that may -- is necessarily driving our retail sales specifically today. But I believe that, that as a result, when you're comparing, you're going to see improvement.

And our next question is from the line of Bill Armstrong with CL King & Associates. William R. Armstrong - CL King & Associates, Inc., Research Division: A follow-up on Jeff's question. So sounds like you're hiring -- pace of hiring's improved. What about stylist turnover? What are the trends there? I know that was an issue in the December quarter? Daniel J. Hanrahan: Yes, the way we -- Bill, the way we look at that is holistically. So we know that we're in a highly transitory business, right? And so we work, we're working very hard on stylist retention. I can tell you that we outpaced, by a fair amount, new hires over terminations, and that the terminations were down pretty substantially from the fourth quarter. And I attribute all that to our field leadership and our -- and the HR support that they are getting. We're focusing -- we're really focusing on providing a good -- making it a good place for a stylist to work here at Regis. We want to be known as the place to work, so that we're very attractive, and we want to be a very sticky place. But so we saw terms go down, but more encouraging, we saw new hires go up. So the 2 worked well together for us in the first quarter. William R. Armstrong - CL King & Associates, Inc., Research Division: Okay, that's great. And I guess for Steve, a couple of accounting questions. That depreciation you had, an asset repayment [ph] of $8.9 million. That was within the depreciation and amortization number, right? Steven M. Spiegel: That's correct. William R. Armstrong - CL King & Associates, Inc., Research Division: So going forward, are we looking at like a $19 million to $20 million quarterly run rate for depreciation? Steven M. Spiegel: We don't give guidance on what we are expecting in the future, but to address asset impairment, as our business begins to turn, we would anticipate that asset impairment would decline, and then -- but when our business turns, we wouldn't have the ability to take back that impairment. William R. Armstrong - CL King & Associates, Inc., Research Division: Right. So -- but the ongoing -- the ongoing depreciation, amortization excluding any impairments, looks like it's about $19 million, is that accurate? Steven M. Spiegel: Yes, that's accurate. William R. Armstrong - CL King & Associates, Inc., Research Division: Okay, okay. And then, on the tax rate going forward, so are we going to be non-taxed going forward for the foreseeable future? Or how does that work? Steven M. Spiegel: For the foreseeable future, we will not be tax affecting our numbers. So until such time as we're able to reverse the valuation allowance, which is predicated on us turning the business around and demonstrating sustainable results, we will be nontax affected.

And our next question is from the line of Jill Nelson with Johnson Rice. Jill R. Caruthers - Johnson Rice & Company, L.L.C., Research Division: If you could talk about -- you've done a really good job on the cost savings, kind of a run rate, it looks like you're running close $15 million, $20 million annually. Could you maybe quantify what you think that ongoing savings run rate could be? Or currently is? Steven M. Spiegel: We don't typically give guidance in our future results, but what I'll tell you is, is some of the savings are from tremendous efforts on the part of the organization to figure out how to work smarter and more efficiently. Some of them are being driven by the field organization, and I'd be cautious to want to want to pin a perspective run rate of savings, recognizing we haven't yet nailed complete execution in our salons. Jill R. Caruthers - Johnson Rice & Company, L.L.C., Research Division: Okay. And then, just following on the asset impairment you took in the quarter, and just kind of your opportunity for store closings, stores that are underperforming significantly, and kind of what's your optimum number of salons as you kind of look out long-term? Steven M. Spiegel: Well, we don't necessarily plan an optimum number of salons to exit, but we -- we're always looking at salons that are underperforming. And to the extent we have opportunities to fix the business, we first try to do that. If it's our understanding that we're unable to fix the business, our next opportunity is to try to turn that over to a franchisee, who could then potentially turn the business around more quickly than we could. And if that's not an option for us, then we allow the lease to expire. Generally, the cash flows that the underperforming salons are generating are, while they're negative, they're -- they tend to be less negative than if we had to pay the rent.

And as there are no further questions, I will now turn the conference back to Dan. Daniel J. Hanrahan: Thank you, George. Thank you, everybody, for joining us. We look forward to talking to you after our fourth quarter.

Ladies and gentlemen, if you wish to access the replay for this presentation, you may do so by visiting regiscorp.com in the Investor Relations section of the website, or by dialing 1 (800) 406-7325 with the access code of 4679962, followed by the # sign. This concludes our conference for today. Thank you for participating and have a nice day. All parties may now disconnect.