HOUSTON, June 2, 2011 /PRNewswire/ -- Subsidiaries of
Rick's Cabaret International, Inc., (NASDAQ: RICK), the
nation's leading group of upscale gentlemen's clubs, has signed an
asset purchase agreement that will give it controlling ownership of
an adult nightclub just east of downtown Omaha. A subsidiary of Rick's Cabaret also has
agreed to purchase the building where the club is located.
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Under terms of the agreed transaction Rick's Cabaret will pay
$425,000 in cash to the current
owners of Sarie's Lounge at 2449 N. 13th Street in Carter
Lake. The current owners of Sarie's Lounge will hold a 40 percent
interest in a new subsidiary formed to operate the club. Rick's
Cabaret will receive a 10 percent royalty on gross revenues for the
use of the Rick's Cabaret name by the new subsidiary
and Rick's Cabaret will also be entitled to 60 percent of
profits while the minority shareholders will earn the remaining 40
percent.
Under terms of a separate purchase agreement Rick's Cabaret
subsidiary RCI Holdings, Inc. has agreed to pay $1,275,000 for the building that houses the
current Sarie's Lounge. RCI Holdings will lease the property back
to the new owners.
Rick's Cabaret has also agreed to loan the enterprise up to
$500,000 to be used for remodeling,
capital improvements, advertising, promotion, marketing and
other operating expenses, if necessary.
"This acquisition extends our footprint in the Midwest, with a
terrific location near the heart of Omaha," said Rick's Cabaret president and CEO
Eric Langan. "After
renovations have been completed we will rebrand the club as a
Rick's Cabaret, bringing our traditionally fine, first-class
entertainment experience to this vibrant market."
Closing of the transactions is expected before the end of June,
subject to conditions consistent with acquisitions of this type,
plus closing on the associated real property purchase.
About Rick's Cabaret: Rick's Cabaret International, Inc.
(NASDAQ: RICK) comprises 23 upscale adult nightclubs serving
primarily businessmen and professionals that offer live
entertainment, dining and bar operations. Nightclubs in
New York City, Miami, Philadelphia, Charlotte, Dallas, Houston, Minneapolis and other cities operate under the
names "Rick's Cabaret," "XTC," "Club Onyx" and "Tootsie's Cabaret".
Sexual contact is not permitted at these locations. Rick's Cabaret
also operates a media division, ED Publications, and owns the adult
Internet membership Website couplestouch.com as well as a network
of online adult auction sites under the flagship URL
naughtybids.com. Rick's Cabaret common stock is traded on NASDAQ
under the symbol RICK. For further information contact ir@ricks.com
or visit www.ricksinvestor.com.
Forward-looking Statements: This document contains
forward-looking statements that involve a number of risks and
uncertainties that could cause the company's actual results to
differ materially from those indicated in this document, including
the risks and uncertainties associated with operating and managing
an adult business, the business climates in cities where it
operates, the success or lack thereof in launching and building the
company's businesses, risks and uncertainties related to the
operational and financial results of our Web sites, conditions
relevant to real estate transactions, and numerous other factors
such as laws governing the operation of adult entertainment
businesses, competition and dependence on key personnel. Additional
factors that could cause the Company's results to differ materially
from those described in the forward-looking statements are
described in forms filed with the SEC from time to time and
available at www.ricksinvestor.com or on the SEC's internet website
at www.sec.gov. Rick's has no obligation to update or revise
the forward-looking statements to reflect the occurrence of future
events or circumstances. For further information visit
www.ricksinvestor.com.
SOURCE Rick's Cabaret International, Inc.