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Rick's Cabaret International, Inc., Closes on Financing for Midtown Manhattan Gentlemen's Club That Will Become Its Flagship
--(BUSINESS WIRE)--Dec. 1, 2004--Rick's Cabaret International
, a publicly traded company that operates gentlemen's clubs, said today it has closed on financing sufficient to complete the acquisition of a gentlemen's club in midtown Manhattan. The parties have agreed to extend the closing of the transaction to January 15, 2005.
Eric Langan, CEO of Houston-based Rick's Cabaret, said the former Paradise Club on West 33rd Street near the Empire State Building, Times Square and Madison Square Garden will be remodeled and will become the flagship club of the Rick's Cabaret chain of gentlemen's clubs in Texas, Louisiana and Minnesota.
At the closing RCI will pay a total of $7.625 million for the assets and stock of the existing club, $2.5 million in cash and $5.125 million in a promissory note bearing simple interest at the rate of 4.0% per annum, part of which is convertible to restricted shares of Rick's Cabaret common stock at prices ranging from $4.00 to $7.50 per share (Rick's Cabaret shares closed at $2.95 on the NASDAQ SmallCap exchange on November 30, compared with $1.85 one year earlier).
Mr. Langan said the company would begin work immediately after closing on a $1.4 million remodeling project. The club will operate on three levels and will utilize the maximum allowable 10,000 square feet, with an additional 4,000 square feet to be used for office space. The company is in the process of acquiring building permits for the renovation and completing other details typical of transactions of this type.
"We intend to make this the top gentlemen's club in the midtown area," Mr. Langan said. "We're known for our beautiful and gracious entertainers and I assure you that customers will be amazed at the welcome they get at the New York Rick's Cabaret."
Rick's Cabaret expects to announce its fourth quarter earnings later this month. In earlier statements Mr. Langan said the firm is "on track for an excellent year." Rick's Cabaret earned $438,294 or 12 cents per share on revenues of $15 million in fiscal 2003. For the nine months ending June 30, 2004 total company revenues were $11,890,532 with net income of $698,087 and earnings per share for the year to date of 19 cents.
Since its launch in the mid-1980s, Rick's Cabaret's upscale nightclubs have enjoyed a reputation for offering high quality entertainment featuring beautiful women and fine restaurant service in Houston, Minneapolis, San Antonio and Austin. Anna Nicole Smith met her wealthy husband while dancing at a Rick's Cabaret and 13 performers from the clubs have become Penthouse Pets (three have been named "Pet of the Year") while three have become Playboy Playmates. The company went public in 1995 and was the first gentlemen's club to be listed on a major U.S. stock exchange.
About Rick's Cabaret
Rick's Cabaret International, Inc.
owns and operates upscale adult nightclubs serving primarily businessmen and professionals that offer live adult entertainment, restaurant and bar operations. The company owns and operates seven adult nightclubs under the name "Rick's Cabaret" and "XTC" in Houston, Austin and San Antonio, Texas, and Minneapolis, Minnesota, licenses Rick's Cabaret in New Orleans, and owns a sports bar called the "Hummers" in Houston. No sexual contact is permitted at any of these locations. Rick's Cabaret also owns an adult Internet membership Web site,
, and a network of nine online auction sites under the flagship URL
that provide a sales platform for adult products and services in an auction format and generate revenues through transactional service fees. Rick's Cabaret common stock is traded on the NASDAQ Small Cap market under the symbol
. For further information contact
This press release may contain forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934 that involves significant risks and uncertainties, and is subject to the safe harbors created by this section. Important factors that could cause actual results for Rick's Cabaret to differ materially from those indicated in this press release include the risks and uncertainties as to the future operational and financial results of our Web sites, conditions relevant to real estate transactions, the future operational performance of our partners, the laws governing the operation of adult entertainment businesses, competitive and economic factors, dependence on key personnel and the ability to manage operations. Rick's Cabaret has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances. Please refer to the documents Rick's Cabaret files from time to time with the Securities and Exchange Commission, in particular the most recent quarterly reports on Form 10-QSB and annual report on Form 10-KSB.
For Rick's Cabaret International, Inc.
Allan Priaulx, 212-338-0050