NEW YORK, March 5, 2013 /PRNewswire/ -- Rick's Cabaret International, Inc. (NASDAQ:RICK), the publicly traded group of upscale gentlemen's clubs, has completed the acquisition of a second adult business in midtown Manhattan. The company plans to open a new gentlemen's club at the 61 West 37th Street location, just east of Sixth Avenue.
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Rick's Cabaret paid $3 million for the business, with $1.5 million paid in cash and the remaining $1.5 million in six percent promissory notes convertible into shares of Rick's Cabaret common stock at a conversion price of $10.25. Funds for the cash portion of the acquisition came in part from a recent $3 million raise arranged for the company by investment banker Brean Capital LLC. The company also entered into a new 20-year lease for the five-story building.
"It is extremely rare to find a venue for a new gentlemen's club in Manhattan so we feel very fortunate to have acquired this amazing location between Fifth and Sixth Avenues, close to Times Square and Madison Square Garden, Penn Station and the Port Authority Terminal, and to dozens of great hotels," said Eric Langan, President and CEO of Rick's Cabaret, which currently operates 35 clubs around the country. "We will begin immediately to renovate the building, using the first three floors for the club and preserving the upper floors for apartments. We plan to open with a sensational new club theme that will differentiate it from, but will be complementary to, our highly successful Rick's Cabaret/New York at 50 West 33rd Street."
The Houston-based company opened the 33rd Street club in 2005. It is across from the Empire State Building and down the street from Madison Square Garden and Penn Station. With a Zagat-rated steakhouse, rooftop cigar lounge and a full floor of VIP suites it is a popular spot with businessmen, celebrities, athletes and couples. Playboy.com named it the "best strip club in New York."
About Rick's Cabaret: Rick's Cabaret International, Inc. (NASDAQ: RICK) is home to 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/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities as "Rick's Cabaret," "XTC," "Club Onyx" and "Tootsie's Cabaret" and other brand names. Sexual contact is not permitted at any locations. Rick's Cabaret also operates a media division, ED Publications. 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. Twitter: @rickscabaret; Facebook: http://www.facebook.com/rickscabaretintl.
Forward-looking Statements: This press release may contain 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 press release, 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. 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.