PURCHASE AGREEMENT
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This Purchase Agreement (the "Agreement") is made and entered into this
10th day of October, 2006, by and among Xxxxxx Xxxxxxx ("Seller" or "Xxxxxxx"),
Playmates Gentlemen's Club, L.L.C., a Texas limited liability company (the
"Company"), Rick's Cabaret International, Inc., a Texas corporation ("Rick's)
and RCI Entertainment (Austin), Inc., a Texas corporation ("Buyer").
WHEREAS, Seller owns 100% of the membership interest of the Company (the
"Membership Interest"); and
WHEREAS, the Buyer is a wholly owned subsidiary of Rick's; and
WHEREAS, the Company owns an adult entertainment cabaret known as
"Playmates" (the "Club"), located at 0000 Xxxxxxxxxx Xxxx, Xxxxxx 00000 (the
"Premises"); and
WHEREAS, Seller desires to sell 51% of the issued and outstanding
Membership Interest of the Company to Buyer on the terms and conditions set
forth herein; and
WHEREAS, Buyer desires to purchase 51% of the issued and outstanding
Membership Interest of the Company from Seller on the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of the premises, the mutual covenants and
agreements and the respective representations and warranties herein contained,
and on the terms and subject to the conditions herein set forth, the parties
hereto, intending to be legally bound, hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF THE MEMBERSHIP INTEREST
Section 1.1 Sale of the Membership Interest. Subject to the terms and
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conditions set forth in this Agreement, at the Closing (as hereinafter defined)
Seller hereby agrees to sell, transfer, convey and deliver to Buyer 51% of the
issued and outstanding Membership Interest of the Company, free and clear of all
encumbrances, and shall deliver to Buyer certificates representing the
Membership Interest, duly endorsed to Buyer or accompanied by duly executed
stock powers in form and substance satisfactory to Buyer.
Section 1.2 Purchase Price for the Membership Interest. As
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consideration for the purchase of the Membership Interest, Buyer shall pay to
Seller the total consideration of $1,500,000 (the "Purchase Price"), which shall
be payable as follows:
(a) $500,000 cash payable at Closing; and
(b) 125,000 shares of restricted common stock $.01 par value of Rick's
(the "Shares") to be valued at $8.00 per share.
Section 1.3 Right of Xxxxxxx to "Put" Shares. On or after one year
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from the Closing Date, Xxxxxxx shall have the right but not the obligation to
have Rick's purchase from Xxxxxxx 5,000 Shares per month (the "Monthly Shares"),
calculated at a price per share equal to $8.00
("Value of the Shares") until Xxxxxxx has received a total of $1,000,000 from
the sale of the Shares (the "Put"). Xxxxxxx shall notify Rick's during any given
month of its election to "Put" the Monthly Shares to Rick's during that
particular month. Thereafter Rick's shall have three (3) business days to
elect, at its option, to buy the Monthly Shares or instruct Xxxxxxx to sell the
Monthly Shares in the open market. At Rick's election, during any given month,
it may either buy the Monthly Shares or if Rick's elects not to buy the Monthly
Shares from Xxxxxxx, then Xxxxxxx shall sell the Monthly Shares in the open
market and any deficiency between the amount which Xxxxxxx receives from the
sale of the Monthly Shares and the Value of the Shares shall be paid by Rick's
within three (3) business days after receipt of written notice of the sale of
the Monthly Shares and the amount of the deficiency during that particular
month. Rick's obligation under this Section 1.3 to purchase the Monthly Shares
from Xxxxxxx shall terminate and cease at such time as Xxxxxxx has received a
total of $1,000,000 from the sale of the Shares. Xxxxxxx agrees to provide
monthly statements to Rick's as to the total number of Shares which he has sold
and the amount of proceeds derived therefrom. Nothing contained in this Section
1.3 shall limit or preclude Xxxxxxx from selling the Shares in the open market
or require Xxxxxxx to "Put" the Shares to Rick's during any given month.
In the event the Seller elects not to "Put" the Shares to Rick's, the
Seller shall not sell more than 10,000 Shares per week in the open market,
provided that Seller complies with Rule 144 of the Securities Act of 1933, as
amended, in connection with his sale of the Shares.
ARTICLE II
CLOSING
Section 2.1 The Closing. The closing of the transactions provided for
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in this Agreement shall take place on the earlier of: (i) December 31, 2006, or
(ii) ten (10) days after the issuance of a Certificate of Occupancy by the City
of Austin (the "Closing Date"), or at such other time and place as agreed upon
in writing among the parties hereto (the "Closing"). The parties have agreed
further to close at the law officers of Xxxxxxx, Xxxxx & Xxxxxxxxx, 0000
Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000.
Section 2.2 Delivery and Execution. At the Closing: (a) the Seller
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shall deliver to Buyer certificates evidencing the Membership Interest of the
Company, free and clear of any liens, claims, equities, charges, options, rights
of first refusal or encumbrances, duly endorsed to Buyer or accompanied by duly
executed stock powers in form and substance satisfactory to Buyer against
delivery by Buyer to the Seller of payment in an amount equal to the Purchase
Price of the Membership Interest being purchased by Buyer in the manner set
forth in Section 1.2; and (b) the Related Transactions (as defined below) shall
be consummated concurrently with the Closing.
Section 2.3 Related Transactions. In addition to the purchase and sale
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of the Membership Interest, the following actions shall take place
contemporaneously at the Closing (collectively, the "Related Transactions"):
(i) The Buyer and the Seller will enter into a Management Agreement with
terms and conditions for the management of the Club which will include
an agreement of the Buyer to provide an initial $200,000 line of
credit for the operation of the Club;
Purchase Agreement - Page 2
(ii) The Seller will enter into a five (5) year covenant not to compete
pursuant to the terms of which the Seller will agree not to compete,
either directly of indirectly, with the Company, the Club, Rick's or
any of their affiliates, by operating an establishment featuring live
adult entertainment within a one (1) mile radius of the Premises;
(iii) The Landlord for the Premises shall have entered into a new lease
agreement with the Company acceptable to all of the parties (the
"Lease"), giving the Company the right to lease the Premises for at
least ten (10) years at not more than $29,000 per month, with the
right to an option to an additional ten (10) years at not more than
$37,000 per month, with the Buyer agreeing to guarantee the first two
(2) years of the Lease;
(iv) Buyer and Seller shall have entered into a Buy-Sell Agreement relating
to the ownership of their Membership Interests in the Company; and
(v) Rick's and the Seller shall have entered into a Lock-Up/Leak-Out
Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF SELLER AND THE COMPANY
Seller and the Company, jointly and severally, hereby represent and warrant
to the Buyer and Rick's as follows:
Section 3.1. Organization, Good Standing and Qualification.
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(a) The Company (i) is an entity duly organized, validly existing and
in good standing under the laws of the state of Texas, (ii) has all requisite
power and authority to own, operate and lease its properties and to carry on its
business, and (iii) is duly qualified to transact business and is in good
standing in all jurisdictions where its ownership, lease or operation of
property or the conduct of its business requires such qualification, except
where the failure to do so would not have a material adverse effect to Seller or
the Company, respectively.
(b) The authorized capital of the Company consists of _______ units of
Membership Interest of which _______ units of Membership Interest are validly
issued and outstanding. There is no other class of capital authorized or issued
by the Company. All of the issued and outstanding Membership Interest of the
Company are owned by Seller and are fully paid and non-assessable. None of the
Membership Interest issued are in violation of any preemptive rights. The
Company has no obligation to repurchase, reacquire, or redeem any of its
outstanding Membership Interest. There are no outstanding securities
convertible into or evidencing the right to purchase or subscribe for any
Membership Interest of the Company, there are no outstanding or authorized
options, warrants, calls, subscriptions, rights, commitments or any other
agreements of any character obligating the Company to issue any Membership
Interest or any securities convertible into or evidencing the right to purchase
or subscribe for any Membership Interest, and there are no agreements or
understandings with respect to the voting, sale, transfer or registration of any
Membership Interest of the Company.
Purchase Agreement - Page 3
Section 3.2 Ownership of the Membership Interest. Seller owns,
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beneficially and of record, all of the Membership Interest of the Company free
and clear of any liens, claims, equities, charges, options, rights of first
refusal, or encumbrances. Seller has the unrestricted right and power to
transfer, convey and deliver full ownership of the Membership Interest without
the consent or agreement of any other person and without any designation,
declaration or filing with any governmental authority. Upon the transfer of the
Membership Interest to Buyer as contemplated herein, Buyer will receive good and
valid title thereto, free and clear of any liens, claims, equities, charges,
options, rights of first refusal, encumbrances or other restrictions (except
those imposed by applicable securities laws).
Section 3.3 Authorization. The Company has all requisite corporate
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power and authority to execute and deliver this Agreement and to perform its
obligations hereunder and to consummate the transactions contemplated hereby.
All action on the part of the Company necessary for the authorization,
execution, delivery and performance of this Agreement and all documents related
to consummate the transactions contemplated herein have been taken or will be
taken prior to the Closing Date by the Company. This Agreement, when duly
executed and delivered in accordance with its terms, will constitute legal,
valid and binding obligations of the Company and Seller enforceable against them
in accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization and other similar laws of general application
affecting creditors' rights generally or by general equitable principles.
Xxxxxxx represents that he is a person of full age of majority, with full
power, capacity, and authority to enter into this Agreement and perform the
obligations contemplated hereby by and for himself. All action on the part of
Xxxxxxx necessary for the authorization, execution, delivery and performance of
this Agreement by him has been taken and will be taken prior to Closing Date.
This Agreement, when duly executed and delivered in accordance with its terms,
will constitute legal, valid and binding obligations of Xxxxxxx enforceable
against him in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization and other similar laws of general
application affecting creditors' rights generally or by general equitable
principles.
Section 3.4 Consents. No consent of, approval by, order or
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authorization of, or registration, declaration or filing by the Seller or the
Company with any court or any governmental or regulatory agency or authority
having jurisdiction over the Seller or the Company or any of its property or
assets is required on the part of the Seller or the Company (a) in connection
with the consummation of the transactions contemplated by this Agreement or (b)
as a condition to the legality, validity or enforceability as against the
Company of this Agreement, excluding any registration, declaration or filing the
failure to effect which would not have a material adverse effect on the
financial condition of the Company.
Section 3.5 Acquisition of Stock for Investment. The Seller
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understands that any issuance of the Shares (as referenced in Section 1.2
herein) will not have been registered under the Securities Act of 1933, as
amended (the "Act"), or any state securities acts, and accordingly, are
restricted securities, and the Seller represents and warrants to the Buyer and
Rick's that the Seller's present intention is to receive and hold the Shares for
investment only and not with a view to the distribution or resale thereof.
Purchase Agreement - Page 4
Additionally, the Seller understands that any sale of any the Shares
issued, under current law, will require either (a) the registration of the
Shares under the Act and applicable state securities acts; (b) compliance with
Rule 144 of the Act; or (c) the availability of an exemption from the
registration requirements of the Act and applicable state securities acts.
To assist in implementing the above provisions, the Seller hereby consents
to the placement of the legend, or a substantially similar legend, set forth
below, on all certificates representing ownership of the Shares acquired hereby
until the Shares have been sold, transferred, or otherwise disposed of, pursuant
to the requirements hereof. The legend shall read substantially as follows:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES ACTS.
THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT, ARE
RESTRICTED AS TO TRANSFERABILITY, AND MAY NOT BE SOLD,
HYPOTHECATED, OR OTHERWISE TRANSFERRED WITHOUT COMPLIANCE WITH
THE REGISTRATION AND QUALIFICATION PROVISIONS OF APPLICABLE
FEDERAL AND STATE SECURITIES LAWS OR APPLICABLE EXEMPTIONS
THEREFROM."
Section 3.6 Sellers' Access to Information. The Seller hereby confirms
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and represents that he (a) has received a copy of Rick's Form 10-KSB filed with
the Securities and Exchange Commission (the "SEC") for the year ended September
30, 2005, as amended, and a copy of Rick's Form 10-QSB's for the quarter ended
December 31, 2005, March 31, 2006 and June 30, 2006, as filed with the SEC; (b)
a copy of Rick's Form 14C filed with the SEC on April 24, 2006; (c) a copy of
the Form 8-K's filed with the SEC on March 27, 2006, April 6, 2006, April 14,
2006, May 11, 2006, July 12, 2006, July 13, 2006, August 10, 2006 and August 28,
2006; (d) has been afforded the opportunity to ask questions of and receive
answers from representatives of Rick's concerning the business and financial
condition, properties, operations and prospects of Rick's; (e) has such
knowledge and experience in financial and business matters so as to be capable
of evaluating the relative merits and risks of the transactions contemplated
hereby; (f) has had an opportunity to engage and is represented by an attorney
of his choice; (g) has had an opportunity to negotiate the terms and conditions
of this Agreement; (h) has been given adequate time to evaluate the merits and
risks of the transactions contemplated hereby; and (i) has been provided with
and given an opportunity to review all current information about Rick's. Seller
has asked such questions to representatives of Rick's about Rick's as he desires
to ask and all such questions have been answered to the full satisfaction of
each Seller. The forms filed by Rick's with the SEC as set forth in Section
3.6(a), (b) and (c) are hereafter collectively referred to as "SEC Reports".
Section 3.7 Purchase for Investment. The Seller is acquiring the
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Rick's Shares for his own account, for investment purposes only and not with
view to any public resale or other distribution thereof. Seller acknowledges
that he is an Accredited Investor as that term is defined in Rule 501(a) of
Regulation D of the Securities Act of 1933, as amended. Seller and his
representatives have received, or have had access to, and have had sufficient
opportunity to review, all books, records, financial information and other
information which Seller considers necessary or advisable to enable him to make
a decision concerning its acquisition of the Shares, and that he
Purchase Agreement - Page 5
possesses such knowledge and experience in financial and business matters that
he is capable of evaluating the merits and risks of his investment hereunder.
Section 3.8 No Default. The Company is not (a) in violation of any
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provision of its Articles of Organization or Regulations or (b) in default under
any term or condition of any instrument evidencing, creating or securing any
indebtedness of the Company, and there has been no default in any material
obligation to be performed by the Company under any other contract, lease,
agreement, commitment or undertaking to which it is a party or by which it or
its assets or properties are bound, nor has the Company waived any material
right under any such contract, lease, agreement, commitment or undertaking.
Section 3.9 Taxes. The Company has timely and accurately filed all
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federal, state, foreign and local tax returns and reports required to be filed
prior to such dates and have timely paid all taxes shown on such returns as owed
for the periods of such returns, including all sales taxes and withholding or
other payroll related taxes shown on such returns and any taxes required to have
been withheld and paid in connection with amounts paid or owing to any employee,
creditor or independent contractor. The Company has made adequate provision for
the payment of all taxes accruable for all periods ending on or before the
Closing Date to any taxing authority and are not delinquent in the payment of
any tax or governmental charge of any nature. No assessments or notices of
deficiency or other communications have been received by the Company with
respect to any tax return which has not been paid, discharged or fully reserved
against and no amendments or applications for refund have been filed or are
planned with respect to any such return. Neither the Company nor the Seller has
knowledge of any action by any taxing authority in connection with assessing
additional taxes against or in respect of it for any past period. There are no
agreements between the Company and any taxing authority waiving or extending any
statute of limitations with respect to any tax return.
Section 3.10 Financial Statements. Seller has delivered to Buyer the
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financial information available relating to the Company ( the "Financial
Information"). Such Financial Information, are in accordance with the books and
records of the Company and fairly represent the financial position of the
Company and the results of operations and changes in financial position of the
Company as of the dates and for the periods indicated. Except as set forth in
Exhibit 3.10, the Company, as of the date of the Financial Information, has no
material liability or obligation of any nature, whether absolute, accrued,
continued or otherwise. As of the Closing Date, Seller represents there have
been no adverse changes in the financial condition or other operations,
business, properties or assets of the Company from that reflected in the latest
Financial Information of the Company as furnished pursuant to this Agreement.
Section 3.11 Labor Matters. The Company is not a party or otherwise
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subject to any collective bargaining agreement with any labor union or
association. The Company is not a party to any written or oral contract,
agreement or understanding for the employment of any officer, director or
employee of the Company. The Company is not a party to any employee benefits
plans (as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended) or any other fringe or employee benefits plan, programs or
arrangements.
Purchase Agreement - Page 6
Section 3.12 Compliance with Laws; Permits. The Company is, and at all
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times prior to the date hereof has been in compliance with all statutes, orders,
rules, ordinances and regulations applicable to it or to the ownership of its
assets or the operation of their businesses. The Company owns, holds or
possesses, or will own, hold or posses prior to the Closing Date, all permits
and licenses which are in any manner necessary for it to conduct its sexually
oriented business, including the right to serve alcoholic beverages.
Section 3.13 No Conflicts. The execution and delivery by the Company
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and the Seller of this Agreement does not, and the performance and consummation
by the Company and the Seller of the transactions contemplated hereby will not
(i) conflict with the articles of organization or regulations of the Company;
(ii) conflict with or result in a breach or violation of, or default under, or
give rise to any right of acceleration or termination of, any of the terms,
conditions or provisions of any note, bond, lease, license, agreement or other
instrument or obligation to which the Company is a party or by which the
Company's or Seller's assets or properties are bound; (iii) result in the
creation of any encumbrance on any of the assets or properties of the Company;
or (iv) violate any law, rule, regulation or order applicable to the Company or
Seller or any of the Company's assets or properties.
Section 3.14 Title to Properties; Encumbrances. The Company has good
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and marketable title to all of the personal property and assets, that are used
in the business that are material to the condition (financial or otherwise),
business, operations or prospects of the Company, free and clear of all
mortgages, claims, liens, security interests, charges, leases, encumbrances and
other restrictions of any kind and nature, except (i) as disclosed in the
Financial Statements of the Company, (ii) statutory liens not yet delinquent,
and (iii) such liens consisting of zoning or planning restrictions,
imperfections of title, easements, pledges, charges and encumbrances, if any, as
do not materially detract from the value or materially interfere with the
present use of the property or assets subject thereto or affected thereby. The
Company does not own any real property.
Section 3.15 No Pending Transactions. Except for the transactions
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contemplated by this Agreement, neither Seller nor the Company is a party to or
bound by or the subject of any agreement, undertaking, commitment or discussions
or negotiations with any person that could result in (i) the sale, merger,
consolidation or recapitalization of the Company, (ii) the sale of any of the
assets of the Company except in the ordinary course of business, (iii) the sale
of any outstanding Membership Interest of the Company, (iv) the acquisition by
the Company of any operating business or the capital stock of any other person
or entity, (v) the borrowing of money by the Company, whether secured or
unsecured, or (vi) any agreement with any of the respective officers, managers
or affiliates of the Company.
Section 3.16 Contracts and Leases. Except as set forth in Exhibit
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3.16, the Company (i) has no leases of personal property relating to the assets
of the Company, whether as lessor or lessee; (ii) has no contractual or other
obligations relating to the assets of the Company, whether written or oral; and
(iii) has not given any power of attorney to any person or organization for any
purpose relating to the assets of the Company. Other than as contemplated by
this Agreement, as of the Closing Date, there will not be any lease agreements
for the Premises where the Club is located. The Company has provided Buyer
access to each and every contract, lease or other document relating to the
assets of the Company to which they are subject or are a party or a beneficiary.
To Seller's knowledge, such contracts, leases or other documents are valid and
in full force and effect according to their terms and
Purchase Agreement - Page 7
constitutes a legal, valid and binding obligation of the Company and the other
respective parties thereto and are enforceable in accordance with their terms.
Seller has no knowledge of any default or breach under such contracts, leases or
other documents or of any pending or threatened claims under any such contracts,
leases or other documents.
Section 3.17 No Default. The Company is not (a) in violation of any
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provision of its articles of organization or regulations or (b) in default under
any term or condition of any instrument evidencing, creating or securing any
indebtedness of the Company, and there has been no default in any material
obligation to be performed by the Company under any other contract, lease,
agreement, commitment or undertaking to which it is a party or by which it or
its assets or properties are bound, nor has the Company waived any material
right under any such contract, lease, agreement, commitment or undertaking.
Section 3.18 Books and Records. The books of account, minute books,
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stock record books or other records of the Company that exist are accurate and
complete and have been maintained in accordance with sound business practices
and will be located at the Premises upon Closing.
Section 3.19 Insurance Policies. Copies of all insurance policies
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maintained by the Company relating to the operation of the Club have been
delivered or made available to Buyer. The policies of insurance held by the
Company are in such amounts, and insure against such losses and risks, as the
Company reasonably deems appropriate for its property and business operations.
All such insurance policies are in full force and effect, and all premiums due
thereon have been paid. Valid policies for such insurance will be outstanding
and duly in force at all times prior to the Closing.
Section 3.20 Pending Claims. Except as set forth in Exhibit 3.20,
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there is no claim, suit, arbitration, investigation, action or other proceeding,
whether judicial, administrative or otherwise, now pending or, to the best of
the Company's or Xxxxxxx'x knowledge, threatened before any court, arbitration,
administrative or regulatory body or any governmental agency which may result in
any judgment, order, award, decree, liability or other determination which will
or could reasonably be expected to have any effect upon the Company, or the
business of the Club or the transfer of the Membership Interest by the Seller to
Buyer under this Agreement or the operation of the Club after the Closing Date,
nor is there any basis known to the Company or Xxxxxxx for any such action. No
litigation is pending, or, to the Company's or Xxxxxxx'x knowledge, threatened
against the Company, or the business of the Club, or their assets or properties
which seeks to restrain or enjoin the execution and delivery of this Agreement
or any of the documents referred to herein or the consummation of any of the
transactions contemplated thereby or hereby. Neither the Company nor Xxxxxxx is
subject to any judicial injunction or mandate or any quasi-judicial or
administrative order or restriction directed to or against them which would
affect the Company or the business of the Club, or the Membership Interest to be
transferred under this Agreement.
Section 3.21 No Liabilities. As of the Closing Date, Company shall have
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no obligations or liability (contingent or otherwise) to any third party, except
as set forth in exhibit 3.16.
Section 3.22 Brokerage Commission. No broker or finder has acted for
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the Seller, or the Company in connection with this Agreement or the transactions
contemplated hereby, and no person
Purchase Agreement - Page 8
is entitled to any brokerage or finder's fee or compensation in respect thereof
based in any way on agreements, arrangements or understandings made by or on
behalf of Seller or the Company.
Section 3.23 Environmental. The Company has not received any citation,
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directive, letter or other communication, written or oral, or any notice of any
proceeding, claim or lawsuit relating to any environmental issue arising out of
the ownership or occupation of the Club.
Section 3.24 Banks and Brokerage Accounts. Exhibit 3.24 sets forth (a)
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a true and complete list of the names and locations of all banks, trust
companies, securities brokers and other financial institutions at which the
Company has an account or safe deposit box or maintains a banking, custodial,
trading or other similar relationship, and (b) a true and complete list and
description of each such account, box and relationship, indicating in each case
the account number and the names of the respective officers, employees, agents
or other similar representatives of the Company having signatory power with
respect thereto.
Section 3.25 Disclosure. No representation or warranty of Seller or
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the Company contained in this Agreement (including the exhibits hereto) contains
any untrue statement or omits to state a material fact necessary in order to
make the statements contained herein or therein, in light of the circumstances
under which they were made, not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF BUYER
Buyer hereby represents and warrants to Seller as follows:
Section 4.1 Organization, Good Standing and Qualification. Buyer (i)
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is an entity duly organized, validly existing and in good standing under the
laws of the state of Texas, (ii) has all requisite power and authority to carry
on its business, and (iii) is duly qualified to transact business and is in good
standing in all jurisdictions where its ownership, lease or operation of
property or the conduct of its business requires such qualification, except
where the failure to do so would not have a material adverse effect to Buyer.
Section 4.2 Authorization. Buyer is a corporation duly organized in
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the state of Texas and has full power, capacity, and authority to enter into
this Agreement and perform the obligations contemplated hereby. All action on
the part of Buyer necessary for the authorization, execution, delivery and
performance of this Agreement by it has been or will be taken. This Agreement,
when duly executed and delivered in accordance with its terms, will constitute
legal, valid, and binding obligations of Buyer enforceable against Buyer in
accordance with its terms, except as may be limited by bankruptcy, insolvency,
and other similar laws affecting creditors' rights generally or by general
equitable principles.
Section 4.3 Consents. No permit, consent, approval or authorization
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of, or designation, declaration or filing with, any governmental authority or
any other person or entity is required on the part of Buyer in connection with
the execution and delivery by Buyer of this Agreement or the
Purchase Agreement - Page 9
consummation and performance of the transactions contemplated hereby other than
as may be required under the federal securities laws.
Section 4.4 Disclosure. No representation or warranty of Buyer
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contained in this Agreement (including the exhibits hereto) contains any untrue
statement or omits to state a material fact necessary in order to make the
statements contained herein or therein, in light of the circumstances under
which they were made, not misleading.
Section 4.5 Brokerage Commission. No broker or finder has acted for
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the Buyer in connection with this Agreement or the transactions contemplated
hereby, and no person is entitled to any brokerage or finder's fee or
compensation in respect thereof based in any way on agreements, arrangements or
understandings made by or on behalf of Buyer.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF RICK'S
Rick's hereby represents and warrants to Seller as follows:
Section 5.1 Organization, Good Standing and Qualification. Rick's (i)
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is a corporation duly organized, validly existing and in good standing under the
laws of the State of Texas, (ii) has all requisite power and authority to carry
on its business, and (iii) is duly qualified to transact business and is in good
standing in all jurisdictions where its ownership, lease or operation of
property or the conduct of its business requires such qualification, except
where the failure to do so would not have a material adverse effect to Rick's.
Section 5.2 Authorization. Rick's is a corporation duly organized in
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the state of Texas and has full power, capacity, and authority to enter into
this Agreement and perform the obligations contemplated hereby. All action on
the part of Rick's necessary for the authorization, execution, delivery and
performance of this Agreement by it has been or will be taken. This Agreement,
when duly executed and delivered in accordance with its terms, will constitute
legal, valid, and binding obligations of Rick's enforceable against it in
accordance with its terms, except as may be limited by bankruptcy, insolvency,
and other similar laws affecting creditors' rights generally or by general
equitable principles.
Section 5.3 Consents. No permit, consent, approval or authorization
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of, or designation, declaration or filing with, any governmental authority or
any other person or entity is required on the part of the Buyer or Rick's in
connection with the execution and delivery by Rick's of this Agreement or the
consummation and performance of the transactions contemplated hereby other than
as may be required under the federal securities laws.
Section 5.4 Disclosure. No representation or warranty of Rick's
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contained in this Agreement (including the exhibits hereto) contains any untrue
statement or omits to state a material fact necessary in order to make the
statements contained herein or therein, in light of the circumstances under
which they were made, not misleading.
Purchase Agreement - Page 10
Section 5.5 Brokerage Commission. No broker or finder has acted for
---------------------
Rick's in connection with this Agreement or the transactions contemplated
hereby, and no person is entitled to any brokerage or finder's fee or
compensation in respect thereof based in any way on agreements, arrangements or
understandings made by or on behalf of Rick's.
Section 5.6 Compliance with Laws; Permits. Except as disclosed in the
-----------------------------
SEC Reports, Rick's is, and at all times prior to the date hereof has been, to
the best of its knowledge, in compliance with all statutes, orders, rules,
ordinances and regulations applicable to it or to the operation of its business
or ownership of its assets or the operation of its businesses, except for
failures to be in compliance that would not have a material adverse effect on
the business, properties or condition (financial or otherwise) of Rick's.
Section 5.7 No Conflicts. The execution and delivery of this Agreement
------------
by Rick's does not, and the performance and consummation of the transactions
contemplated hereby by the Buyer and Rick's , will not (i) conflict with the
articles of incorporation or bylaws of Rick's; (ii) conflict with or result in a
breach or violation of, or default under, or give rise to any right of
acceleration or termination of, any of the terms, conditions or provisions of
any note, bond, lease, license, agreement or other instrument or obligation to
which Rick's is a party or by which Rick's assets or properties are bound; (iii)
result in the creation of any encumbrance on any of the assets or properties of
the Buyer; or (iv) violate any law, rule, regulation or order applicable to
Rick's or any of Rick's securities, assets or properties
Section 5.8 No Default. Rick's is not (a) in violation of any
-----------
provision of its articles of incorporation or bylaws or (b) in default under any
term or condition of any instrument evidencing, creating or securing any
indebtedness of Rick's, and there has been no default in any material obligation
to be performed by Rick's under any other contract, lease, agreement, commitment
or undertaking to which it is a party or by which it or its assets or properties
are bound, nor has Rick's waived any material right under any such contract,
lease, agreement, commitment or undertaking.
Section 5.9 Pending Claims. Except as described in the SEC Reports,
---------------
there is no claim, suit, arbitration, investigation, action or other proceeding,
whether judicial, administrative or otherwise, now pending or, to the best of
the Rick's's knowledge, threatened before any court, arbitration, administrative
or regulatory body or any governmental agency which may result in any judgment,
order, award, decree, liability or other determination which will or could
reasonably be expected to have a material adverse effect upon Rick's, nor is
there any basis known to Rick's for any such action. No litigation is pending,
or, to Rick's knowledge, threatened against Rick's or its assets or properties
which seeks to restrain or enjoin the execution and delivery of this Agreement
or any of the documents referred to herein or the consummation of any of the
transactions contemplated thereby or hereby. Rick's is not subject to any
judicial injunction or mandate or any quasi-judicial or administrative order or
restriction directed to or against it which would have a material adverse affect
on the Buyer.
Purchase Agreement - Page 11
ARTICLE VI
COVENANTS OF THE COMPANY
Section 6.1 Stand Still. To induce Buyer and Xxxxx to proceed with
------------
this Agreement, the Company and Seller agree that until the Closing Date or the
termination of this Agreement, neither any representative of the Company nor the
Seller will offer to sell or solicit any offer to purchase or engage in any
discussions or activities of any nature whatsoever, directly or indirectly,
involving in any manner the actual or potential sale, transfer, encumbrance,
pledge, collateralization or hypothecation of any assets of the Company or
Membership Interest of the Seller. The Company and the Seller hereby agree to
advise the Buyer and Xxxxx of any contact from any third party regarding the
acquisition of any Membership Interest of the Seller or other investment in the
Company, or of any contact which would relate to the transactions contemplated
by this Agreement.
Section 6.2 Access; Due Diligence. Between the date of this Agreement
---------------------
and the Closing Date, the Company and Seller shall (a) provide Buyer and their
authorized representatives reasonable access to all plants, offices, warehouse
and other facilities and properties of the Company and to the books and records
of the Company; (b) permit the Buyer to make inspections thereof; and (c) cause
the officers and advisors of the Company to furnish the Buyer with such
financial and operating data and other information with respect to the business
and properties of the Company and to discuss with the Buyer and their authorized
representatives the affairs of the Company as the Buyer may from time to time
reasonably request.
Section 6.3 Conduct of Business. From the date of the execution hereof
-------------------
until the Closing Date, the Company shall operate the business of the Club in
the ordinary course of business, and:
(a) The Company will not authorize, declare, pay or effect any dividend
except as is consistent with past practices of the Company or
liquidation or other distribution in respect of the units of
membership interest of the Company or other equity interest or any
direct or indirect redemption, purchase or other acquisition of any
equity interest of the Company;
(b) The Company will not make any changes in their condition (financial or
otherwise), liabilities, assets, or business or in any of their
business relationships, including relationships with suppliers or
customers, that, when considered individually or in the aggregate,
might reasonably be expected to have a material adverse effect on the
Company;
(c) The Company will not increase the salary or other compensation payable
or to become payable by the Company to any employee, or the
declaration, payment, or commitment or obligation of any kind for the
payment by the Company of a bonus or other additional salary or
compensation to any such person except in the normal course of
business, consistent with past practices of the Company;
(d) The Company will not sell, lease, transfer or assign any of their
assets, tangible or intangible, other than for a fair consideration in
the ordinary course of business;
Purchase Agreement - Page 12
(e) The Company will not accelerate, terminate, modify or cancel any
agreement, contract, lease or license (or series of related
agreements, contracts, leases and licenses) involving more than $1,000
to which the Company is a party;
(f) The Company will not make any loans to any person or entity, or
guarantee any loan, absent the consent of the Buyer;
(g) The Company will not waive or release any right or claim held by the
Company, absent the consent of the Buyer;
(h) The Company will operate its business in the ordinary course and
consistent with past practices so as to preserve their business
organization intact, to retain the services of their employees and to
preserve their goodwill and relationships with suppliers, creditors,
customers, and others having business relationships with them;
(i) The Company will not issue any note, bond or other debt security or
create, incur or assume, or guarantee any indebtedness for borrowed
money or capitalized lease obligations;
(j) The Company will not delay or postpone the payment of accounts payable
and other liabilities outside the ordinary course of business;
(k) The Company will not make any loan to, or enter into any other
transaction with, any of their directors, officers, and employees,
outside the ordinary course of business;
(l) The Company will not make any change in any method, practice, or
principle of accounting involving the Company's business, or the
assets of the Company;
(m) The Company will not issue, sell or otherwise dispose of any of its
membership interests, or create, sell or dispose of any options,
rights, conversion rights or other agreements or commitments of any
kind relating to the issuance, sale or disposition of any of their
membership interests;
(n) The Company will not reclassify, split up or otherwise change any of
their membership interests;
(o) The Company will not be a party to any merger, consolidation or other
business combination; and
(p) The Company will not agree to take any action described in this
Section 6.3.
ARTICLE VII
CONDITIONS TO CLOSING
The obligations of the parties to effect the transactions contemplated
hereby are subject to the satisfaction at or prior to the Closing of the
following conditions:
Purchase Agreement - Page 13
Section 7.1 Conditions to Obligations of Buyer and Rick's.
---------------------------------------------------
(a) Representations and Warranties of the Company and the Seller.
------------------------------------------------------------
The representations and warranties of the Company and the Seller shall be true
and correct on the date hereof and on and as of the Closing Date, as though made
on and as of the Closing Date.
(b) Covenants. All covenants, agreements and conditions
---------
contained in this Agreement to be performed by the Company and Seller on or
prior to the Closing Date shall have been performed or complied with in all
respects.
(c) Delivery of Certificates. The Company shall provide to Buyer
------------------------
certificates, dated as of the Closing Date and signed by a representative of the
Company to effect set forth in Section 7.1(a) and 7.1(b) for the purpose of
verifying the accuracy of such representations and warranties and the
performance and satisfaction of such covenants and conditions.
(d) Resolutions. The Company shall have delivered resolutions of
-----------
the Company, which authorize the execution, delivery and performance of this
Agreement and the documents referred to herein to which it is or is to be a
party dated as of the Closing Date.
(e) Delivery of Membership Interest. The Seller shall deliver or
-------------------------------
cause to be delivered to Buyer originally issued certificate representing the
Membership Interest of the Company duly endorsed over to the Buyer in a form
satisfactory to the Buyer.
(f) Related Transactions. The Related Transactions set forth in
---------------------
Section 2.3 shall be consummated concurrently with the Closing.
(g) Third-Party Consents. Any and all consents or waivers
---------------------
required from third parties relating to this Agreement or any of the other
transactions contemplated hereby shall have been obtained.
(h) Satisfactory Diligence. Buyer shall have concluded its due
-----------------------
diligence investigation of the Company and its assets and properties and all
other matters related to the foregoing, and shall be satisfied, in its absolute
and sole discretion, with the results thereof.
(i) No Actions or Proceedings. No claim, action, suit,
----------------------------
investigation or proceeding shall be pending or threatened before any court or
governmental agency which presents a substantial risk of the restraint or
prohibition of the transactions contemplated by this Agreement.
(j) Government Approvals. All authorizations, permits, consents,
--------------------
orders, licenses or approvals of, or declarations or filings with, or expiration
of waiting periods imposed by, any governmental entity necessary for the
consummation of the transactions contemplated by this Agreement shall have been
filed, occurred or been obtained.
(k) Appointment of Manager/Officer. Xxxx Xxxxxx shall have been
-------------------------------
appointed as a Manager of the Company and as its President and Chief Executive
Officer.
Section 7.2 Conditions to Obligations of the Company and the Seller
----------------------------------------------------------
Purchase Agreement - Page 14
(a) Representations, Warranties and Agreements of Buyer and
-------------------------------------------------------------
Rick's. The representations and warranties of Buyer and Rick's shall be true
------
and correct on the date hereof and on and as of the Closing Date, as though made
on and as of the Closing Date.
(b) Covenants. All covenants, agreements and conditions
---------
contained in this Agreement to be performed by the Buyer or Rick's on or prior
to the Closing Date shall have performed or complied with in all respects.
(c) Delivery of Certificates. Buyer and Rick's shall provide to
-------------------------
the Company and Seller certificates dated as of the Closing Date and signed by a
representative of the Buyer and Rick's to the effect set forth in Section 7.2(a)
and 7.2(b) for the purpose of verifying the accuracy of such representations and
warranties and the performance and satisfaction of such covenants and
conditions.
(d) Resolutions. Buyer and Risk's shall deliver resolutions of
-----------
the Buyer and Rick's, which authorize the execution, delivery and performance of
this Agreement and the documents referred to herein to which it is or is to be a
party dated as of the Closing Date.
(e) Payment of Purchase Price. Buyer (i) shall have tendered the
-------------------------
cash portion of the Purchase Price set forth in Section 1.2, and (ii) shall have
delivered the Shares representing a portion of the Purchase Price to Seller as
set forth in Section 1.2, or shall deliver a letter of instruction to the
transfer agent instructing the issuance of the Shares to Seller.
(f) Related Transactions. The Related Transaction set forth in
--------------------
Section 2.3 shall be consummated concurrently with the Closing.
(g) Consents; Transfer of Licenses. All necessary transfers of
--------------------------------
licenses and leases required for the operation of the business of the Company
shall have been obtained. The Certificate of Occupancy issued by the City of
Austin which zones the Premises for an adult oriented business shall be in full
force and effect.
(h) Third Party Consents. Any and all consents or waivers
--------------------
required from third parties relating to this Agreement or any of the other
transactions contemplated hereby shall have been obtained.
(i) No Actions or Proceedings. No claim, action, suit,
-------------------------
investigation or proceeding shall be pending or threatened before any court or
governmental agency which presents a substantial risk of the restraint or
prohibition of the transactions contemplated by this Agreement.
(j) Government Approvals. All authorizations, permits, consents,
--------------------
orders or approvals of, or declarations or filings with, or expiration of
waiting periods imposed by, any governmental entity necessary for the
consummation of the transactions contemplated by this Agreement shall have been
filed, occurred or been obtained.
Purchase Agreement - Page 15
ARTICLE VIII
INDEMNIFICATION
Section 8.1 Indemnification from the Seller and the Company. The
----------------------------------------------------
Seller and the Company hereby agree to and shall indemnify, defend (with legal
counsel reasonably acceptable to Buyer), and hold Buyer, its officers,
directors, shareholders, employees, affiliates, parent, agents, legal counsel,
successors and assigns (collectively, the "Buyer Group") harmless at all times
after the date of this Agreement, from and against any and all actions, suits,
claims, demands, debts, liabilities, obligations, losses, damages, costs,
expenses, penalties or injury (including reasonable attorneys fees and costs of
any suit related thereto) (collectively, "Indemnifiable Loss" or "Indemnifiable
Losses") suffered or incurred by any or all of the Buyer Group arising from:
(a) any material misrepresentation by, or material breach of any covenant or
warranty of the Seller or the Company contained in this Agreement, or any
exhibit, certificate, or other instrument furnished or to be furnished by the
Seller or the Company hereunder; (b) any nonfulfillment of any material
agreement on the part of the Seller or the Company under this Agreement; or
(c) any liabilities of the Company incurred prior to the Closing Date.
Section 8.2 Indemnification from Buyer. Buyer agrees to and shall
----------------------------
indemnify, defend (with legal counsel reasonably acceptable to Company) and hold
the Seller and the Company and their agents, officers, directors, shareholders,
employees, affiliates, parent, agents, legal counsel, successors and assigns,
(collectively, the "Company's Group") harmless at all times after the date of
the Agreement from and against any and all actions, suits, claims, demands,
debts, liabilities, obligations, losses, damages, costs, expenses, penalties or
injury (including reasonably attorneys fees and costs of any suit related
thereto) suffered or incurred by any or all of the Company's Group, arising from
(a) any material misrepresentation by, or material breach of any covenant or
warranty of Buyer contained in this Agreement or any exhibit, certificate, or
other agreement or instrument furnished or to be furnished by Buyer hereunder;
or (b) any nonfulfillment of any material agreement on the part of Buyer under
this Agreement. Further, and so long as Buyer or its affiliates or designees
hold more than 50% interest in the Company, Buyer agrees to and shall indemnify,
defend (with legal counsel reasonably acceptable to Company) and hold the Seller
harmless at all times after the Closing Date, from and against any and all
actions, suits, claims, demands, debts, liabilities, obligations, losses,
damages, costs, expenses, penalties or injury (including reasonably attorneys
fees and costs of any suit related thereto) from third parties suffered or
incurred by Seller arising from or related to any liabilities of the Buyer or
Company incurred subsequent to the Closing Date.
Section 8.3 Defense of Claims. If any lawsuit or enforcement action is
-----------------
filed against any party entitled to the benefit of indemnity hereunder, written
notice thereof shall be given to the indemnifying party as promptly as
practicable (and in any event not less than fifteen (15) days prior to any
hearing date or other date by which action must be taken); provided that the
failure of any indemnified party to give timely notice shall not affect rights
to indemnification hereunder except to the extent that the indemnifying party
demonstrates actual damage caused by such failure. After such notice, the
indemnifying party shall be entitled, if it so elects, to take control of the
defense and investigation of such lawsuit or action and to employ and engage
attorneys of its own choice to handle and defend the same, at the indemnifying
party's cost, risk and expense; and such indemnified party shall cooperate in
all reasonable respects, at its cost, risk and expense, with the indemnifying
party and such attorneys in the investigation, trial and defense of such lawsuit
or action and any
Purchase Agreement - Page 16
appeal arising therefrom; provided, however, that the indemnified party may, at
its own cost, participate in such investigation, trial and defense of such
lawsuit or action and any appeal arising therefrom. The indemnifying party
shall not, without the prior written consent of the indemnified party, effect
any settlement of any proceeding in respect of which any indemnified party is a
party and indemnity has been sought hereunder unless such settlement of a claim,
investigation, suit, or other proceeding only involves a remedy for the payment
of money by the indemnifying party and includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such proceeding.
Section 8.4 Default of Indemnification Obligation. If an entity or
----------------------------------------
individual having an indemnification, defense and hold harmless obligation, as
above provided, shall fail to assume such obligation, then the party or entities
or both, as the case may be, to whom such indemnification, defense and hold
harmless obligation is due shall have the right, but not the obligation, to
assume and maintain such defense (including reasonable counsel fees and costs of
any suit related thereto) and to make any settlement or pay any judgment or
verdict as the individual or entities deem necessary or appropriate in such
individual's or entities' absolute sole discretion and to charge the cost of any
such settlement, payment, expense and costs, including reasonable attorneys
fees, to the entity or individual that had the obligation to provide such
indemnification, defense and hold harmless obligation and same shall constitute
an additional obligation of the entity or of the individual or both, as the case
may be.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Amendment; Waiver. Neither this Agreement nor any
------------------
provision hereof may be amended, modified or supplemented unless in writing,
executed by all the parties hereto. Except as otherwise expressly provided
herein, no waiver with respect to this Agreement shall be enforceable unless in
writing and signed by the party against whom enforcement is sought. Except as
otherwise expressly provided herein, no failure to exercise, delay in
exercising, or single or partial exercise of any right, power or remedy by any
party, and no course of dealing between or among any of the parties, shall
constitute a waiver of, or shall preclude any other or further exercise of, any
right, power or remedy.
Section 9.2 Notices. Any notices or other communications required or
-------
permitted hereunder shall be sufficiently given if in writing and delivered in
person, transmitted by facsimile transmission (fax) or sent by registered or
certified mail (return receipt requested) or recognized overnight delivery
service, postage pre-paid, addressed as follows, or to such other address has
such party may notify to the other parties in writing:
(a) if to the Seller: Xxxxxx Xxxxxxx
0000 XX 00, Xxxxx000
Xxxxxx, Xxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Purchase Agreement - Page 17
with a copy to: Xxxxxxxx X. Xxxxxx, Xx.
000 Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Fax: (000) 000-0000
(b) if to Buyer or Rick's: RCI Entertainment (Austin), Inc.
Attn: Xxxx Xxxxxx, President
00000 Xxxxxx Xxxx
Xxxxxxx, Xxxxx 00000
Fax: (000) 000-0000
with a copy to: Xxxxxx X. Xxxxxxx
Xxxxxxx Xxxxx & Xxxxxxxxx
0000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Fax: (000) 000-0000
A notice or communication will be effective (i) if delivered in person or by
overnight courier, on the business day it is delivered, (ii) if transmitted by
telecopier, on the business day of actual confirmed receipt by the addressee
thereof, and (iii) if sent by registered or certified mail, three (3) business
days after dispatch.
Section 9.3 Severability. Whenever possible, each provision of this
------------
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
Section 9.4 Assignment; Successors and Assigns. Except as otherwise
----------- -----------------------
provided herein, the provisions hereof shall inure to the benefit of, and be
binding upon, the successors and permitted assigns of the parties hereto. No
party hereto may assign its rights or delegate its obligations under this
Agreement without the prior written consent of the other parties hereto, which
consent will not be unreasonably withheld.
Section 9.5 Entire Agreement. This Agreement and the other documents
-----------------
delivered pursuant hereto constitute the full and entire understanding and
agreement between the parties with regard to the subject matter hereof and
thereof and supersede and cancel all prior representations, alleged warranties,
statements, negotiations, undertakings, letters, acceptances, understandings,
contracts and communications, whether verbal or written among the parties hereto
and thereto or their respective agents with respect to or in connection with the
subject matter hereof.
Section 9.6 Jurisdiction. This Agreement shall be governed by, and
------------
construed in accordance with, the laws of the State of Texas, without regard to
principles of conflict of laws. The parties agree that venue for purposes of
construing or enforcing this Agreement shall be proper in Xxxxxx County, Texas,
if litigation is initiated by the Seller or the Company or Xxxxxx County, Texas,
if litigation is initiated by the Buyer.
Purchase Agreement - Page 18
Section 9.7 Counterparts and Facsimiles. This Agreement may be
-----------------------------
executed in multiple counterparts and in any number of counterparts, each of
which shall be deemed an original, but all of which taken together shall
constitute and be deemed to be one and the same instrument and each of which
shall be considered and deemed an original for all purposes. This Agreement
shall be effective with the facsimile signature of any of the parties set forth
below and the facsimile signature shall be deemed as an original signature for
all purposes and the Agreement shall be deemed as an original for all purposes.
Section 9.8 Costs and Expenses. Each party shall pay their own
--------------------
respective fees, costs and disbursements incurred in connection with this
Agreement.
Section 9.9 Section Headings. The section and subsection headings in
-----------------
this Agreement are used solely for convenience of reference, do not constitute a
part of this Agreement, and shall not affect its interpretation.
Section 9.10 No Third-Party Beneficiaries. Nothing in this Agreement
-----------------------------
will confer any third party beneficiary or other rights upon any person
(specifically including any employees of the Company) or any entity that is not
a party to this Agreement.
Section 9.11 Attorneys' Review. In connection with the negotiation and
-----------------
drafting of this Agreement, the parties represent and warrant to each other they
have had the opportunity to be advised by attorneys of their own choice.
Section 9.12 Further Assurances. Each party covenants that at any
-------------------
time, and from time to time, after the Closing Date, it will execute such
additional instruments and take such actions as may be reasonably be requested
by the other parties to confirm or perfect or otherwise to carry out the intent
and purposes of this Agreement.
Section 9.13 Survival of Representations, Warranties and Covenants.
--------------------------------------------------------
All representations and warranties made in, pursuant to or in connection with
this Agreement shall survive the execution and delivery of this Agreement for
the maximum period allowed by law.
Section 9.14 Public Announcements. The parties hereto agree that
---------------------
prior to making any public announcement or statement with respect to the
transactions contemplated by this Agreement, the party desiring to make such
public announcement or statement shall consult with the other parties hereto and
exercise their best efforts to (i) agree upon the text of a joint public
announcement or statement to be made by all of such parties or (ii) obtain
approval of the other parties hereto to the text of a public announcement or
statement to be made solely by the party desiring to make such public
announcement; provided, however, that if any party hereto is required by law to
make such public announcement or statement, then such announcement or statement
may be made without the approval of the other parties.
Section 9.15 Validity. The invalidity or unenforceability of any
--------
provision of this Agreement shall not affect the validity or enforceability of
any other provisions of this Agreement, which shall remain in full force and
effect.
Purchase Agreement - Page 19
Section 9.16 Exhibits Not Attached. Any exhibits not attached hereto
----------------------
on the date of execution of this Agreement shall be deemed to be and shall
become a part of this Agreement as if executed on the date hereof upon each of
the parties initialing and dating each such exhibit, upon their respective
acceptance of its terms, conditions and/or form.
IN WITNESS WHEREOF, the undersigned have executed this Purchase Agreement
to become effective as of the date first set forth above.
RCI ENTERTAINMENT (AUSTIN), INC.
/s/ Xxxx Xxxxxx
----------------------------------------
By: Xxxx Xxxxxx, President
Date: October 10, 2005
-----------------------------------
RICK'S CABARET INTERNATIONAL, INC.
/s/ Xxxx Xxxxxx
----------------------------------------
By: Xxxx Xxxxxx, President
Date: October 10, 2005
-----------------------------------
SELLER
/s/ Xxxxxx Xxxxxxx
----------------------------------------
Xxxxxx Xxxxxxx, Individually
Date: October 5, 2006
-----------------------------------
PLAYMATES GENTLEMEN CLUB, LLC
/s/ Xxxxxx Xxxxxxx
----------------------------------------
By: Xxxxxx Xxxxxxx, Manager
Date: October 5, 2006
-----------------------------------
Purchase Agreement - Page 20
EXHIBITS
Purchase Agreement - Page 21
