Rick's Cabaret International, Inc. Signs Letter Of Intent To Acquire Controlling Interest In Philadelphia Adult Night Club, Crazy Horse Too
HOUSTON-(August 9, 2007)-Rick's Cabaret International, Inc.
operator of upscale gentlemen's clubs, said today it has signed
a letter of intent, subject to execution of definitive documents,
to acquire controlling interest in an adult nightclub in Philadelphia
currently operating as Crazy Horse Too
The 25,000 square foot club at 2908 South Columbus Blvd., decorated
in fine marble and plush furnishings, opened in January 2006. It
is located minutes from the major Philadelphia sports complex where
games are played
and near the site of a proposed new gambling casino. Under a confidentiality
clause in the letter of intent, terms of the agreement with The
End Zone, Inc.
, which owns and operates the club are not
disclosed at the present time.
"This will be a significant acquisition for us and we look
forward to bringing the Rick's Cabaret brand of upscale adult entertainment
to the Philadelphia market," said Eric Langan
president and CEO of Rick's Cabaret. "The venue already has
the feel of a fine country club, but with significant changes we
are planning, including installation of a sports bar and converting
part of the venue to a high-end steak house, we believe that, once
acquired, it is capable of becoming one of our strongest performers
in terms of revenue and profit."
Terms of the proposed transaction call for Rick's Cabaret International,
Inc. or its subsidiary to purchase 51 percent of the outstanding
stock of The End Zone, Inc.
, and for its subsidiary
RCI Holdings, Inc.
, to acquire 51 percent of TEZ
and 51 percent of TEZ Real Estate,
which owns the building and real property where the
club is located. Upon the closing of the transaction, Rick's Cabaret
will also have a first right of refusal to acquire the remaining
interest in all three entities.
Upon signing of the letter of intent Rick's Cabaret began consulting
with the current management of the Crazy Horse Too. The letter of
intent is subject to the execution of a definitive agreement which
will contain conditions to closing, including, but not limited to,
Rick's Cabaret obtaining adequate financing, approval by relevant
regulatory authorities of the transfer of ownership in the selling
corporation and other conditions consistent with transactions of
this type. A closing is anticipated to take place not later than
the end of 2007.
After completion of this transaction the Philadelphia club will
be rebranded as a Rick's Cabaret. This is the company's third nightclub
acquisition in the past twelve months, during which time the company
has acquired venues in Ft. Worth and Austin, Texas and also signed
a licensing agreement with an operator in Buenos Aires, Argentina.
About Rick's Cabaret
Rick’s Cabaret International, Inc. (NASDAQ: RICK) operates
upscale adult nightclubs serving primarily businessmen and professionals
that offer live adult entertainment, restaurant and bar operations.
The company owns and operates or licenses adult nightclubs in New
York City, New Orleans, Charlotte, Houston, Minneapolis and other
cities under the names "Rick's Cabaret," "XTC"
and "Club Onyx." No sexual contact is permitted at any
of these locations. Rick's Cabaret also owns the adult Internet
membership Web site, couplestouch.com
and a network of online adult auction sites under the flagship URL
Cabaret common stock is traded on NASDAQ under the symbol RICK.
For further information contact [email protected]
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 New York City and elsewhere; the success or lack thereof
in launching and building the company's businesses in New York City
and elsewhere; the Company's ability to identify and secure suitable
locations for new nightclubs on acceptable terms, open the anticipated
number of new nightclubs on time and within budget; achieve anticipated
rates of same-store sales; hire and train additional nightclub personnel
and integrate new nightclubs into its operations; unexpected increases
in costs of sales or employee, pre-opening or other expenses; the
economic conditions in the new markets into which the Company expands
and possible uncertainties in the customer base in these areas;
fluctuations in quarterly operating results; the impact of any negative
publicity or public attitudes; competitive pressure from other national
and regional nightclub chains; 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. 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
go to www.ricks.com.