RCI Hospitality Holdings, Inc. (NasdaqGM:RICK) entered into a definitive agreement to acquire Baby Dolls in Fort Worth from DB Entertainment Inc. for $0.5 million on December 12, 2022. The Purchaser shall pay to the Company for all of the Purchased Assets a total purchase price of Five Hundred Thousand Dollars ($500,000.00) plus sums calculated under 1.4 herein (the “Purchase Price” ), which will be payable at the Closing, as follows: issue to the Company of a 10-year promissory note. Consideration to be paid for all five transactions totals $66.5 million, consisting of $25 million in total cash; 10-year, 7% seller financing notes totaling $25.5 million; and 200,000 restricted shares of common stock based on a per share price of $80, subject to a lock-up, leak out agreement. In a related transaction, RCI Hospitality Holdings also entered into a definitive agreement to acquire three Chicas Locas adult nightclubs and one Baby Dolls club in Dallas, Houston and Arlington. EBITDA contribution of approximately $11 million is expected in the first year. Four locations are open, a fifth will reopen shortly after a full remodel, and RCI anticipates expanding operations of two of the locations. Once the remodeling and expansions are complete, EBITDA is expected to grow to $14 to $16 million annually. Closing, which is expected in January, is subject to transfer of and/or obtaining all necessary permits, licenses, and other authorizations; and other customary closing conditions for transactions of this kind.

Each of the Asset Purchase Agreements, IP Purchase Agreements, ATM Purchase Agreement and Real Estate Purchase Agreement provided that such agreements will terminate and be of no force and effect if the transactions contemplated by such agreements are not consummated on or before January 31, 2023. On January 25 and 26, 2023, the parties to those agreements entered into amendment agreements whereby this date was extended to February 28, 2023.

RCI Hospitality Holdings, Inc. (NasdaqGM:RICK) completed the acquisition of Baby Dolls in Fort Worth from DB Entertainment Inc. on March 16, 2023.