FOR
IMMEDIATE RELEASE
RICK’S
CABARET INTERNATIONAL, INC. SIGNS LETTER OF INTENT TO ACQUIRE CONTROLLING
INTEREST IN PHILADELPHIA ADULT CLUB, CRAZY HORSE TOO
HOUSTON
–
(August 9, 2007) –
Rick’s Cabaret International, Inc
. (NASDAQ:
RICK), 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
Philadelphia Phillies
,
76ers
,
Flyers
and
Eagles
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 Management, LLC
and 51 percent of
TEZ Real Estate
,
LP
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 business executives and
professionals that offer live adult entertainment, restaurant and bar
operations. The company owns, 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.” Sexual contact is not 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 naughtybids.com. Rick’s Cabaret common stock is
traded on NASDAQ under the symbol RICK. For further information contact
[email protected]
.
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 New York City and elsewhere, the success or lack thereof
in
launching and building the company’s businesses in New York City and elsewhere,
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
.