form8k.htm
Securities
and Exchange Commission
Washington,
D.C. 20549
FORM
8-K
Current
Report
Pursuant
To Section 13 or 15(d) Of
The
Securities Exchange Act of 1934
Date
of
Report: October 17, 2007
RICK'S
CABARET INTERNATIONAL, INC.
(Exact Name of Registrant As Specified in Its Charter)
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Texas
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0-26958
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76-0037324
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(State
Or Other Jurisdiction of
Incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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10959
Cutten Road
Houston,
Texas 77066
(Address
Of Principal Executive Offices, Including Zip Code)
(281)
397-6730
(Issuer’s Telephone Number, Including Area Code)
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ITEM
1.01
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ENTRY
INTO A MATERIAL DEFINITIVE
AGREEMENT.
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On
October 17, 2007, we entered into a Purchase Agreement pursuant to the terms
of
which our subsidiary, RCI Entertainment (Philadelphia), Inc. (the “Purchaser”),
will acquire from Vincent Piazza (“Seller”) 51% of the issued and outstanding
shares of common stock (the “TEZ Shares”) of The End Zone, Inc., a Pennsylvania
corporation (the “Company”) which owns and operates “Crazy Horse Too Cabaret”
(the “Club“) located at 2908 South Columbus Blvd., Philadelphia,
Pennsylvania 19148 (the “Real Property”). As part of the
transaction, our subsidiary, RCI Holdings, Inc. (“RCI Holdings”) will acquire
from Seller or the Piazza Family Limited Partnership (the “Partnership Seller”)
51% of the issued and outstanding partnership interest (the “Partnership
Interests”) in TEZ Real Estate, LP, a Pennsylvania limited partnership (the
“Partnership”) and 51% of the issued and outstanding membership interest (the
“Membership Interests”) in TEZ Management, LLC, a Pennsylvania limited liability
company, which is the general partner of the Partnership (the “General
Partner”). The Partnership owns the Real Property where the Club is
located. At closing, we will pay a purchase price of $3,500,000
payable in cash for the Partnership Interests and Membership Interests, and
we
will issue 225,000 shares of our restricted common stock (the “Rick’s Shares”)
for the TEZ Shares.
Pursuant
to the terms of the Purchase Agreement, on or after one year after the closing
date, the Seller shall have the right, but not the obligation to have Rick’s
purchase from Seller 10,000 Rick’s Shares per month (the “Monthly Shares”),
calculated at a price per share equal to $10.00 (“Value of the Rick’s Shares”)
until the Seller has received a total of $2,250,000 from the sale of the Rick’s
Shares. At our election during any given month, we may either buy the
Monthly Shares or, if we elect not to buy the Monthly Shares from the Seller,
then the Seller shall sell the Monthly Shares in the open market. Any
deficiency between the amount which the Seller receives from the sale of the
Monthly Shares and the Value of the Rick’s Shares shall be paid by us within
three (3) business days of the date of sale of the Monthly Shares during that
particular month. Our obligation to purchase the Monthly Shares from
the Seller shall terminate and cease at such time as the Seller has received
a
total of $2,250,000 from the sale of the Rick’s Shares and any
deficiency.
Upon
closing of the transaction, the Seller and the Partnership Seller will enter
a
five-year agreement not to compete with us within a twenty (20) mile radius
of
the Club. Further, at closing the Purchaser and the Seller shall enter into
a
Shareholder’s Agreement relating to their ownership interest in the Company; and
RCI Holdings and the Partnership Seller shall enter into a First Amendment
to
Limited Partnership Agreement relating to the ownership of their partnership
interests and a First Amendment to Operating Agreement relating to the ownership
of their membership interests. Further, at closing the Company will
enter into a new lease agreement with the Partnership giving it the right to
lease the Real Property for twenty (20) years at $50,000 per
month. Finally, as part of the transaction, we will enter into a
Lock-up/Leak-out Agreement with the Seller regarding the sale of the Rick’s
Shares.
The
Agreement provides for the transaction to close on or before seven (7) days
after the approval of the transfer of the TEZ Shares to Purchaser by the
Pennsylvania Liquor Control Board, but in no event later than January 15, 2008,
contingent upon obtaining acceptable financing, transfer of all necessary
licenses and permits, and other conditions to closing typical for transactions
of this nature.
A
copy of
the Purchase Agreement is attached hereto as Exhibit 10.1. A copy of
the press release related to this transaction is attached hereto as Exhibit
99.1.
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ITEM
9.01
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FINANCIAL
STATEMENTS AND EXHIBITS
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(c)
Exhibits
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Exhibit
Number
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Description
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10.1 Purchase
Agreement dated October 17, 2007
99.1 Press
release dated October 17, 2007
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report on Form 8-K to be signed on its behalf by the
undersigned hereunto duly authorized.
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RICK'S
CABARET INTERNATIONAL, INC.
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By:
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/s/ Eric
Langan
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Date:
October 17, 2007
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Eric
Langan
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President
and Chief Executive Officer
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