##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
  Form 10-K
  (Mark One):þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31,
    2009ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number:
    001-32208
  VCG HOLDING CORP.
 (Exact Name of Registrant as
    Specified in its Charter)
  Colorado

84-1157022(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)390 Union Boulevard, Suite 540, Lakewood, CO(Address of principal
    executive offices)

80228(Zip
    Code)   Registrants telephone number, including area code:
 (303) 934-2424
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class:

Name of Each Exchange on Which Registered:Common Stock, $.0001 par value

The NASDAQ Global Market   Securities registered pursuant to Section 12(g) of the
    Act:
 None
  o þ
  o þ
  þ o
  Regulation S-T o þ
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
  Large accelerated filer o

Accelerated filer o

Non-accelerated filero
    (Do not check if a smaller reporting company)

Smaller Reporting company þ   Rule 12b-2 o þ




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##### Table of Contents





VCG
    HOLDING CORP.
  FORM 10-K
  TABLE OF
    CONTENTS
  PART IITEM 1.

Business.


1ITEM 1A.

Risk Factors.


8ITEM 1B.

Unresolved Staff Comments.


18ITEM 2.

Properties.


18ITEM 3.

Legal Proceedings.


22ITEM 4.

(Removed and Reserved)


26PART IIITEM 5.

Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities.


26ITEM 6.

Selected Financial Data.


27ITEM 7.

Managements Discussion and Analysis of
    Financial Condition and Results of Operations.


28ITEM 7A.

Quantitative and Qualitative Disclosures About
    Market Risk.


39ITEM 8.

Financial Statements and Supplementary Data.


40ITEM 9.

Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure.


71ITEM 9A

Controls and Procedures.


71ITEM 9B.

Other Information.


71PART IIIITEM 10.

Directors, Executive Officers and Corporate
    Governance.


72ITEM 11.

Executive Compensation.


77ITEM 12.

Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters.


82ITEM 13.

Certain Relationships and Related Transactions
    and Director Independence.


85ITEM 14.

Principal Accountant Fees and Services.


90PART IVITEM 15.

Exhibits and Financial Statement Schedules.


91SIGNATURES


98




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PART I  Forward-Looking
    Statement Disclaimer
    Form 10-K
      Item 1.
    Business  General
    Information
   1




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##### Table of Contents



Business
    Name of Club

Date Acquired

Club TypePTs®

    Showclub in Indianapolis, Indiana

2002

BPTs®

    Brooklyn in Brooklyn, Illinois

2002

BPTs®

    All Nude in Denver, Colorado

2004

CThe Penthouse
    Club®

    in Glendale, Colorado

2004

ADiamond
    Cabaret®

    in Denver, Colorado

2004

APTs®

    Appaloosa in Colorado Springs, Colorado

October 2006

BPTs®

    Showclub in Denver, Colorado

December 2006

BPTs®

    Showclub in Louisville, Kentucky

January 2007

BRoxys in Brooklyn, Illinois

February 2007

BPTs®

    Showclub in Centreville, Illinois

February 2007

BPTs®

    Sports Cabaret in Sauget, Illinois

March 2007

BThe Penthouse
    Club®

    in Sauget, Illinois

March 2007

AThe Mens
    Club®

    in Raleigh, North Carolina

April 2007

ASchieks Palace Royale in Minneapolis, Minnesota

May 2007

APTs®

    Showclub in Portland, Maine

September 2007

BJaguars Gold Club in Ft. Worth, Texas
    (Golden)

September 2007

CPTs®

    Showclub in Hialeah, Florida

October 2007

BLa Boheme Gentlemens Club in Denver, Colorado

December 2007

BJaguars Gold Club in Dallas, Texas (Manana)

April 2008

CImperial Showgirls Gentlemens Club in Anaheim, California

July 2008

C       day-to-day
   2




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® ®
    
    Facilities  Our club facilities are
    within ready access to the principal business, tourist
    and/or
    commercial districts in the metropolitan areas in which they are
    located. The facilities have state of the art sound systems,
    lighting and professional stage design. Our clubs maintain an
    upscale level of décor and furnishings to create a
    professional appearance. Three of our clubs offer VIP rooms. Our
    VIP rooms are open to individuals who purchase annual
    memberships. They offer a higher level of service and are
    elegantly appointed and spacious.
    Professional
    On-Site
    Management  Our clubs are managed by persons
    who are experienced in the restaurant
    and/or
    hospitality industry. The managers for the clubs are responsible
    for maintaining a quality and professionally run club. At a
    higher level, our Area Directors oversee the management of
    several clubs within a specified geographical area. The Company
    currently has 12 Area Directors who have collectively 18 to
    26 years of experience in the industry.
    Food and Beverage Operations  Many of
    our clubs offer a first-class bar and food service. Five of our
    clubs offer a full service restaurant that provides customers
    with exceptional food, service and luxury. At most locations, we
    provide a selective variety of food including, but not limited
    to, hot and cold appetizers, pizza, and other limited food
    choices. Some of our club operations do not have liquor
    licenses. Those of our clubs that carry B.Y.O.B. permits sell
    non-alcoholic beverages. Experienced chef and bar managers are
    responsible for training, supervising, staffing, and operating
    the food and beverage operations at each club.
    Entertainment  Our clubs provide a high
    standard of attractive, talented, and courteous female and male
    performers and servers. We maintain the highest standards for
    appearance, attitude, demeanor, dress, and personality. The
    entertainment encourages repeat visits and increases the average
    length of a patrons stay. Performers who work at our clubs
    are experienced entertainers.  Working
    Capital
    Advertising
    and Promotion
      Compliance
    Policies and Controls
   3




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Patents,
    Trademarks, Licenses and Royalty Agreements
    ® ® ® ®
    Club Ownership

Trade NameClassic Affairs, Inc.

Schieks Palace RoyaleVCG-IS, LLC

Imperial Showgirls Gentlemens ClubStout Restaurant Concepts, Inc.

La Boheme Gentlemens Cabaret       Seasonality
   4




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Customers
    Competition
  and/or
  Government
    Regulations
    and/or
  Employees
    and Independent Contractors
    Potential
    Sale of the Company
  Form 8-K
 5




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Form 8-K
  Form 8-K
   6




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out-of-pocket
  Form S-4
  Available
    Information
  Form 10-K Form 10-Q Form 8-K Form 10-K.
 7




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Item 1A.
    Risk
    Factors  Form 10-K.
  The
    process of negotiating and consummating the proposed merger
    transaction or any other transaction, as well as the failure to
    successfully consummate such a transaction, could adversely
    affect our business.
  day-to-day and/or
  We are
    subject to litigation related to the proposed going private
    transaction, which could affect our ability to consummate a
    transaction, force us to rescind a transaction if it is
    consummated before the conclusion of the litigation or otherwise
    adversely affect our business or stock price.
  Form 8-K
    We
    have had limited operations which makes our future operating
    results difficult to predict.
   8




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Our
    inability to obtain capital, use internally generated cash, or
    use our securities or debt to finance future expansion efforts
    could impair the growth and expansion of our
    business.
    Our
    business has been, and may continue to be, adversely affected by
    disruptions in the credit markets, including reduced access to
    credit and higher costs of obtaining credit.
    Our
    business has been, and may continue to be, adversely affected by
    conditions in the U.S. financial markets and economic conditions
    generally.
   9




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and/or
  Our
    acquisitions may result in disruptions in our business and
    diversion of managements attention.
  day-to-day
  Our
    business is subject to risks associated with geographic market
    concentration.
    Our
    business operations are subject to regulatory uncertainties
    which may affect our ability to acquire additional nightclubs,
    remain in operation or be profitable.
    and/or
 10




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There
    is substantial competition in the nightclub entertainment
    industry, which may affect our ability to operate profitably or
    acquire additional nightclubs.
    If we
    are unable to effectively promote our brands and establish a
    leading position in the marketplace, our business may
    fail.
  ® ® ®
  Our
    failure to protect our brands may undermine our competitive
    position and litigation to protect our brands or defend against
    third-party allegations of infringement may be
    costly.
    Our
    business is dependent upon management and employees for
    continuing operations and expansion.
  and/or
 11




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Several
    of our landlords and lenders have required
    Mr. Lowries continued management role with our
    Company in order to avoid a default or acceleration of our
    obligations under certain of our leases or loan
    agreements.
    
    election of our Directors;
    amendment of our organizational documents;
    the potential merger or going private transactions or the sale
    of our assets or other corporate transaction; and
    Control of the outcome of any other matter submitted to the
    stockholders for vote.   12




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We
    must comply with all licenses and permits relating to the sale
    of alcohol.
    Activities
    or conduct at our nightclubs may cause us to lose necessary
    business licenses, expose us to liability, or result in adverse
    publicity, which may increase our costs, divert
    managements attention from our business, and cause our
    stockholders to lose confidence in us, thereby lowering our
    profitability and our stock price.
      Our
    industry is viewed negatively by many for moral, religious,
    womens rights, and other reasons, therefore, the market
    for our securities is smaller than for other securities and an
    investor may find it hard to sell our securities.
    Our
    business plan and proposed strategy has not been independently
    evaluated.
   13




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We may
    be subject to uninsured risks which, if realized, could expose
    us to money damages, which we may be unable to
    pay.
    Our
    Directors and Officers have limited liability and are entitled
    to indemnification that could encourage derivative lawsuits and
    require us to direct funds away from our business.
      Form 10-K.
   14




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We
    could use the issuance of additional shares of our authorized
    stock to deter a change in control.
    We
    have employment agreements with Troy Lowrie and Micheal Ocello
    that contain features that may discourage a change of
    control.
          We
    must meet the NASDAQ Global Market continued listing
    requirements or we risk delisting, which may decrease our stock
    price and make it harder for our stockholders to trade our
    stock.
  over-the-counter
 15




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In the
    event the
    make-up of
    our Board or Audit Committee were not, or are not in the future,
    in compliance with the SEC and NASDAQ independence requirements,
    we face a number of risks that could materially and adversely
    affect our stockholders and our business.
      Securities
    analysts may not initiate coverage or continue to cover our
    common stock, and this may have a negative impact on our common
    stocks market price.
    In the
    past, we have raised substantial amounts of capital in private
    placements, and if we fail to comply with the applicable
    securities laws, ensuing rescission rights or lawsuits would
    severely damage our financial position.
    The
    application of the penny stock rules could adversely
    affect the market price of our common stock and increase the
    transaction costs to sell those shares.
   16




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Because
    we do not intend to pay any dividends on our common stock,
    purchases of our common stock may not be suited for investors
    seeking dividend income.
    Future
    sales of our common stock may depress our stock price. A
    significant amount of common stock is subject to issuance upon
    exercise of securities to purchase common stock. The exercise
    and sale of these financial instruments could depress the market
    price of our common stock.
        Ownership
    could be diluted by future issuances of our stock, options,
    warrants or other securities.
    There
    is a limited public trading market for our common
    stock.
    Our
    stock price has been volatile and may fluctuate in the
    future.
    
    our performance and prospects; 17




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
    the depth and liquidity of the market for our securities;
    sales by selling stockholders of shares issued or issuable in
    connection with our private placements;
    investor perception of us and the industry in which we operate;
    changes in earnings estimates or buy/sell recommendations by the
    analyst;
    general financial and other market conditions; and
    Domestic and international economic conditions.    Other
    Risk Factors May Adversely Affect Our Financial
    Performance.
    Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties  month-to-month
     18




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Name/Club Ownership


Lease InformationPTs®

    Brooklyn
    Platinum of Illinois, Inc.
    Acq. Date: 5/1/2002
    Location: Brooklyn, IL
    Sq. Ft.: 9,000
    Building owned by VCG: Yes


An Illinois corporation and wholly-owned subsidiary of VCG.PTs®

    Showclub
    Indy Restaurant Concepts, Inc.
    Acq. Date: 6/30/02
    Location: Indianapolis, IN
    Sq. Ft.: 9,200
    Building owned by VCG: Yes


An Indiana corporation and wholly-owned subsidiary of VCG. VCG
    Real Estate leases a portion of the building that is not used by
    the nightclub operation to an unaffiliated third party.PTs®

    All Nude
    VCG Restaurants Denver, Inc.
    Acq. Date: 6/30/04
    Location: Denver, CO
    Sq. Ft.: 8,000
    Building owned by VCG: No


A Colorado corporation and wholly-owned subsidiary of VCG. The
    building is leased from an unaffiliated third party currently
    for $14,500 per month. The regular lease term expired in January
    2010 but the Company exercised a five year extension option and
    the lease now will expire in January 2015. The base rent for
    each subsequent lease year during the option period commencing
    February 2010 and every February 1st will increase or decrease
    by the percentage increase in the Consumer Price Index
    (CPI) for the month of February immediately
    preceding the adjustment date, and the CPI for the month of
    February for the year preceding the adjustment date.The Penthouse
    Club®

    Glendale Restaurant Concepts, LP
    Acq. Date: 6/30/04
    Location: Glendale, CO
    Sq. Ft.: 9,600
    Building owned by VCG: No


A Colorado limited partnership and 98% owned subsidiary of VCG,
    including the 1% general partnership interest. The building is
    leased from Lowrie Management LLLP, controlled by our Chairman
    of the Board and CEO, Troy Lowrie, currently for $13,500 per
    month. The lease term expires September 2014 and has three
    options to extend that expire September 2029. The base rent
    adjusts every five years. The rent from years one to five was
    $12,000 per month, years six to ten is $13,500 per month, years
    eleven to fifteen (option 1) is $15,000 per month, years sixteen
    to twenty (option 2) is $16,500 per month, and years twenty one
    to twenty five (option 3) is $18,000 per month.PTs®

    Showclub Appaloosa
    VCG CO Springs, Inc.
    Acq. Date: 10/2/06
    Location: Colorado Springs, CO
    Sq. Ft.: 9,500
    Building owned by VCG: No


A Colorado corporation and wholly-owned subsidiary of VCG. The
    building is leased from an unaffiliated third party for $10,000
    per month. The lease term expires October 2016 and has two
    options to extend that expire October 2026. The base rent
    adjusts every five years. The rent from years one to five is
    $10,000 per month, years six to ten is $10,500 per month, years
    eleven to fifteen (option 1) is $12,000 per month, and years
    sixteen to twenty (option 2) is $13,500 per month.Diamond
    Cabaret®

    Glenarm Restaurant, LLC
    Acq. Date: 10/8/04
    Location: Denver, CO
    Sq. Ft.: 36,000
    Building owned by VCG: No


A Colorado limited liability company and 90% owned subsidiary of
    VCG. The building is leased from an unaffiliated third party for
    $45,000 per month. The lease term expires October 2014 and has
    three options to extend that expire October 2029. The base rent
    adjusts every five years. The rent from years one to five was
    $40,000 per month, years six to ten is $45,000 per month, years
    eleven to fifteen (option 1) is $50,000 per month, years sixteen
    to twenty (option 2) is $55,000 per month, and years twenty one
    to twenty five (option 3) is $60,000. 19




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Name/Club Ownership


Lease InformationPTs®

    Show Club
    Denver Restaurant Concepts, LP
    Acq. Date: 12/28/06
    Location: Denver, CO
    Sq. Ft.: 20,720
    Building owned by VCG: No


A Colorado limited partnership and 98% owned subsidiary of VCG.
    The building is leased from Lowrie Management LLLP, controlled
    by our Chairman of the Board and CEO, Troy Lowrie, currently for
    $17,500 per month. This square footage includes nightclub,
    office and storage space. The lease term expires December 2015
    and has three options to extend that expire December 2029. The
    base rent adjusts every five years. The rent from years one to
    five was $15,000 per month, years six to ten is $17,500 per
    month, years eleven to fifteen (option 1) is $20,000 per month,
    years sixteen to twenty (option 2) is $22,500 per month, and
    years twenty one to twenty five (option 3) is $25,000.Roxys
    RCC LP
    Acq. Date: 1/18/07
    Location: Brooklyn, IL
    Sq. Ft.: 4,400
    Building owned by VCG: No


An Illinois limited partnership and 88% subsidiary of VCG.
    The building is leased from an unaffiliated third party for
    $5,000 per month. The lease term expires January 2017 and has
    two options to extend that expire January 2027. The base rent
    never changes, but the rent amount fluctuates monthly based on
    sales.PTs®

    Showclub
    Kentucky Restaurant Concepts, Inc.
    Acq. Date: 1/2/07
    Location: Louisville, KY
    Sq. Ft.: 23,000
    Building owned by VCG: No


A Kentucky corporation and 100% owned subsidiary of VCG. The
    building is leased from Lowrie Management LLLP, controlled by
    our Chairman of the Board and CEO, Troy Lowrie, currently for
    $7,500 per month. The lease term expires December 2016 and has
    three five year options to extend that expire December 2031. The
    base rent adjusts every five years. The rent from years one to
    five is $7,500 per month, years six to ten is $8,750 per month,
    years eleven to fifteen (option 1) is $10,000 per month, years
    sixteen to twenty (option 2) is $11,250 per month, and years
    twenty one to twenty five (option 3) is $12,000.PTs®

    Showclub
    Cardinal Management LP
    Acq. Date: 2/5/07
    Location: Centreville, IL
    Sq. Ft.: 5,700
    Building owned by VCG: No


An Illinois limited partnership and 83% owned subsidiary of VCG.
    The building is leased from an unaffiliated third party for
    $5,000 per month. The lease term expires January 2017 and has
    two options to extend that expire January 2027. The base rent
    never changes, but the rent amount fluctuates monthly based on
    sales.PTs®

    Sports Cabaret
    MRC LP
    Acq. Date: 2/9/07
    Location: Sauget, IL
    Sq. Ft.: 9,700
    Building Owned by VCG: No


An Illinois limited partnership and 100% owned subsidiary of
    VCG. The building is leased from an unaffiliated third party for
    $20,000 per month. The lease term expires February 2017 and has
    two options to extend that expire February 2027. The base rent
    never changes but the rent amount fluctuates monthly based on
    sales.The Penthouse
    Club®

    IRC LP
    Acq. Date: 2/7/07
    Location: Sauget, IL
    Sq. Ft.: 19,300
    Building Owned by VCG: No


An Illinois limited partnership and a 90% owned subsidiary of
    VCG. The building is leased from an unaffiliated third party for
    $25,000 per month. The lease term expires March 2017 and has two
    options to extend that expire March 2027. The base rent never
    changes but the rent amount fluctuates monthly based on sales. 20




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##### Table of Contents



Name/Club Ownership


Lease InformationThe Mens
    Club®

    Raleigh Restaurant Concepts, Inc.
    Acq. Date: 4/16/07
    Location: Raleigh, NC
    Sq. Ft.: 21,200
    Building owned by VCG: No


A North Carolina corporation and wholly-owned subsidiary of VCG.
    The building is leased from an unaffiliated third party
    currently for $6,000 per month. This lease has options to renew
    for ten consecutive renewal terms of five years each that expire
    January 2062. The base rent adjusts every five years by $250
    after January 2017 with a maximum of $8,250 per month. The
    Company also has a separate lease for the parking premises
    currently for $20,250 per month. This lease expires January 2012
    and has ten consecutive renewal terms of five years each that
    expire on January 2062. The base rent adjusts on every renewal
    term by $500 with a maximum of $45,750.Schieks Palace Royale
    Classic Affairs, Inc.
    Acq. Date: 5/30/07
    Location: Minneapolis, MN
    Sq. Ft.: 11,600
    Building owned by VCG: No


A Minnesota corporation and wholly-owned subsidiary of VCG. The
    building is leased from an unaffiliated third party currently
    for $25,000 per month. The building lease term expires June 2012
    and has three five year options to extend that expire June 2027.
    The base rent adjusts every five years. The rent from one to
    five years is $25,000 per month, years six to ten (option 1) is
    $27,750 per month, years eleven to fifteen (option 2) is $30,000
    per month, and years sixteen to twenty (option 3) is $33,000 per
    month.PTs®

    Showclub
    Kenkev II, Inc.
    Acq. Date: 9/14/07
    Location: Portland, ME
    Sq. Ft.: 13,000
    Building owned by VCG: No


A Maine corporation and wholly-owned subsidiary of VCG. The
    building is leased from an unaffiliated third party currently
    for $14,750 per month. The lease term expires September 2032 and
    has two options to extend that expire September 2042. The base
    rent adjusts every year by 3% after the first year of the lease.Jaguars Gold Club
    Golden Productions JGC
    Fort Worth LLC
    Acq. Date: 9/17/07
    Location: Fort Worth, TX
    Sq. Ft.: 10,000
    Building owned by VCG: Yes


A Texas limited liability company and wholly-owned subsidiary of
    VCG. The building is owned by the nightclub but the land is
    leased from an unaffiliated third party currently for $20,000
    per month. The lease term expires September 2012 and has four
    five year options to extend that expire September 2032. The base
    rent adjusts every option period by 10% over the prior
    terms rental obligation.PTs®

    Showclub
    Kenja II, Inc.
    Acq. Date: 10/29/07
    Location: Miami, FL
    Sq. Ft.: 7,600
    Building owned by VCG: No


A Florida corporation and wholly-owned subsidiary of VCG. The
    building is leased from an unaffiliated third party currently
    for $10,609 per month. The lease term expires October 2032 and
    has two options to extend that expire October 2042. The base
    rent adjusts every year by 3% after the first year of the lease.La Boheme Gentlemens Club
    Stout Restaurant Concepts, Inc.
    Acq. Date: 12/21/07
    Location: Denver, CO
    Sq. Ft.: 6,200
    Building owned by VCG: No


A Colorado corporation and wholly-owned subsidiary of VCG. The
    building is leased from an unaffiliated third party currently
    for $17,000 per month. The lease term expires June 2016. The
    base rent adjusts every three years. The rent from years one to
    four is $17,000 per month, five to seven years is $20,000 per
    month, and eight to nine years is $21,000 per month.Jaguars Gold Club
    Manana Entertainment, Inc.
    Acq. Date: 4/14/08
    Location: Dallas, TX
    Sq. Ft.: 12,500
    Building owned by VCG: Yes


A Texas limited liability company and wholly-owned subsidiary of
    VCG. The building is owned by the nightclub but the land is
    leased from an unaffiliated third party for $25,000 per month.
    The lease term expires April 2013 and has four five year options
    to extend that expire April 2033. The base rent adjusts every
    option period by 10% over the prior terms rental
    obligation. 21




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Name/Club Ownership


Lease InformationImperial Showgirls Gentlemens Club
    VCG-IS, LLC
    Acq. Date: 7/28/08
    Location: Anaheim, CA
    Sq. Ft.: 8,100
    Building owned by VCG: No


A California corporation and wholly-owned subsidiary of VCG. The
    building is leased from an unaffiliated third party currently
    for $8,000 per month. The lease term expires August 2010 and has
    four five year options to extend that expire August 2025. The
    base rent adjusts by $500 every five years with a maximum of
    $9,500 per month.   Item 3.
    Legal
    Proceedings    Thee
    Dollhouse Productions Litigation
      Zajkowski,
    et. al. vs VCG and Classic Affairs Litigation
     22




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Texas
    Patron Tax Litigation
        Department
    of Labor and Immigration and Customs Enforcement
    Reviews
  United
    States Department of Labor (DOL) Audit (PTs
    Showclub)
  ®
    Immigration
    and Customs Enforcement (ICE) Reviews
  ®
 23




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Internal
    Revenue Service
  ®
    Litigation
    Associated with the Proposed Going Private
    Transaction
  Form 8-K
     24




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Form 8-K
  Form 10-K, Form 8-K
       25




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Item 4.
    (Remove
    and Reserved) PART II  Item 5.
    Market
    For Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities  Market
    Information
      2009


2008Three Months Ended

High


Low


High


LowMarch 31

$
1.85


$
1.27


$
13.90


$
5.95June 30

$
2.79


$
1.38


$
6.70


$
3.60September 30

$
2.30


$
1.90


$
4.03


$
2.80December 31

$
2.31


$
1.62


$
3.35


$
1.24     Holders
    Dividends
    Recent
    Sales of Unregistered Securities
    Transfer
    Agent and Registrar
    Purchases
    of Equity Securities by the Issuer and Affiliated
    Purchasers
   26




---



##### Table of Contents



Maximum NumberTotal Number of


(or ApproximateShares Purchased


Dollar Value) of SharesTotal Number





as Part of Publicly


that may yet beof Shares


Average Price


Announced Plans


Purchased UnderPeriod

Purchased(1)


Paid per Share


or Programs(1)


the Plans or ProgramsOctober 1 to 31, 2009


44,681


$
2.05



44,681


788,194 shares or $
8,046,913November 1 to 30, 2009


473


$
1.83



473


787,721 shares or $
8,046,033December 1 to 31, 2009


-


$
-



-


787,721 shares or $
8,046,033Total


45,154
(2)

$
2.04



45,154
(2)

787,721 shares or $
8,046,033     (1)
    
    Unless noted, the Company made all repurchases in the open
    market.(2)
    
    Of these repurchases, the Company purchased 37,454 shares
    of common stock in the open market and 7,700 shares of
    common stock in a private transaction.    Item 6.
    Selected
    Financial Data  Form 10-K.
  Description

2009


2008


2007


2006


2005(Restated)Total revenue

$
55,040,034
(5)

$
57,692,671
(3),(4)

$
39,616,731
(2)

$
16,114,581
(1)

$
15,854,153Net income (loss) from operations

$
5,075,311


$
(37,440,195
)

$
5,442,076


$
236,833


$
(1,271,251
)Basic income (loss) per common share

$
0.04


$
(1.71
)

$
0.33


$
0.03


$
(0.15
)Weighted average shares outstanding


17,541,376



17,925,132



16,623,213



9,128,985



8,477,571Total assets

$
71,151,173


$
75,626,043


$
103,719,255


$
35,079,698


$
27,859,065Total stockholders equity

$
28,482,530


$
28,386,742


$
53,987,842


$
12,795,623


$
3,043,588   Form 10-K
    (1)
    
    Fiscal year 2006 reflects the acquisitions of two adult
    nightclubs in Colorado.(2)
    
    Fiscal year 2007 reflects the sale of Arizona and the
    acquisitions of 11 adult nightclubs in Minnesota (1), Illinois
    (4), Colorado (1), Maine (1), Florida (1) North Carolina
    (1), Kentucky (1), and Texas (1).(3)
    
    Fiscal year 2008 reflects the acquisitions of one adult
    nightclub in California and one in Texas. See Note 4 to the
    Consolidated Financial Statements. 27




---



##### Table of Contents



(4)
    
    Fiscal year 2008 includes non-cash impairment charges for
    goodwill, licenses, trade names and other intangible assets for
    a total amount of approximately $46.0 million. In addition
    the Company recognized a non-cash impairment of real estate of
    approximately $1.9 million. See Note 6 to the
    Consolidated Financial Statements.(5)
    
    Fiscal year 2009 includes non-cash impairment charges for
    goodwill, licenses, trade names and other intangible assets for
    a total amount of approximately $2.0 million. In addition
    the Company recognized a non-cash impairment of real estate of
    approximately $268,000. See Note 6 to the Consolidated
    Financial Statements.  Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Forward-Looking
    Statement Disclaimer
    Form 10-K
     28




---



##### Table of Contents



Overview
    Critical
    Accounting Estimates
      Assignment
    of Fair Values upon Acquisition of Licenses, Goodwill and Other
    Intangibles
  Business Combinations Intangibles -
    Goodwill and Other
      Testing
    for Impairment of Intangible Assets
   29




---



##### Table of Contents



Impairment
    of Real Estate
  Property Plant and Equipment
  Stock
    Options
  rd rd
     30




---



##### Table of Contents



Legal
    and Other Contingencies
    IRS
    Tip Audit
  ®
  DOL
    Audit
  ®
    Self-Insured
    Health Insurance
    Income
    Taxes
   31




---



##### Table of Contents



Results
    of Operations
  Year
    Ended December 31, 2009 Compared to Year Ended
    December 31, 2008
  Revenues
      Cost
    of Goods Sold
   32




---



##### Table of Contents



Salaries
    and Wages
    
    an increase in the federal and state minimum wages ranging from
    $0.17 to $0.70 per hour from 2008 to 2009;
    the estimated accrual of $200,000 for DOL minimum wage
    violations for 2006 through 2008; offset in part by a reduction
    in club employee headcount by approximately 85 tipped, minimum
    wage personnel from December 31, 2008 headcounts.        Other
    General and Administrative Expenses
    
    increased payroll taxes of $616,000 or 37.9%. This increase
    includes the estimated tip audit accrual of $207,000 plus the
    additional FICA tax already paid on unreported tip from 2006 to
    2008 of $61,500 and additional FICA tax paid on reported tips in
    2009;
    increases in taxes and permits of approximately $72,000 or
    15.4%. This category contains club liquor, cabaret or sexually
    oriented business (S.O.B.) licenses, sales tax, and
    business and health inspection licenses. This category also
    includes amounts expensed for the Texas Patron Tax, paid under
    protest, in the amounts of approximately $290,000 for the year
    ended December 31, 2009 and $203,000 for the year ended
    December 31, 2008. Refer to Item 3 Legal Proceedings for
    additional information; and
    decreases in property taxes of approximately $103,000 or 12.9%.
    Property tax valuations were protested in the five clubs located
    in East St. Louis, resulting in a property tax savings of
    approximately $30,000. The sale of the Arizona building in July
    2009, with annual property taxes of approximately $60,000,
    reduced the 2009 property tax expense by almost $30,000.
    Assessed values of club properties were reduced in Texas, with a
    savings of approximately $16,000.     33




---



##### Table of Contents




    audit and quarterly review fees of $210,000 (see Item 14
    Principal Accountant Fees and Services in Part III);
    tax return preparation fees of $214,000 to file 2008 tax
    returns, amend all the Companys federal and state returns
    filed in 2008 for the fiscal year ending December 31, 2007
    and correct earlier years state tax returns;
    consultant expenses to test internal controls and document
    compliance with the Sarbanes-Oxley Act of 2002 of approximately
    $99,000;
    $102,000 in marketing consulting fee expenses paid by warrants
    that expired in 2009; and
    $290,000 of valuation and impairment calculation costs and
    consulting fees for work related to the SEC comment letter and
    subsequent amended SEC filings;             34




---



##### Table of Contents



Depreciation
    and Amortization
      Interest
    Expense
    Interest
    Income
    Loss
    on Sale of Assets
    Income
    Taxes
     35




---



##### Table of Contents



Liquidity
    and Capital Resources
    Working
    Capital
               36




---



##### Table of Contents



Capital
    Resources
   37




---



##### Table of Contents



December 31,2009


2008Net Income (loss) attributable to VCG

$
735,691


$
(30,710,794
)Add back:Depreciation


1,695,277



1,678,043Amortization of covenants
    not-to-compete


17,035



20,761Amortization of leasehold rights and liabilities, net


(212,342
)


(192,067
)Amortization of loan fees


216,205



448,015Amortization component 2 goodwill


157,077



144,896Interest expense


3,456,616



3,761,151Income taxes


339,000



(11,101,610
)EBITDA before non-cash impairment charges


6,404,559



35,951,605Add back:Non-cash impairment charges


2,026,000



48,006,241EBITDA excluding non-cash impairment charges

$
8,430,559


$
12,054,636      38




---



##### Table of Contents



EBITDA (excluding non-cash impairment charges)

$
8,430,559


$
12,054,636Less:Interest expense


3,456,616



3,761,151Net income (loss) attributable to noncontrolling interests


476,717



428,614Total income tax


339,000



(11,101,610
)Capital expenditures


1,454,478



1,324,252Free cash flow

$
2,703,748


$
17,642,229   Contractual
    Obligations and Commercial Commitments
    Total


2010


2011


2012


2013


2014


ThereafterLong-term debt

$
30,747,383


$
3,867,344


$
16,842,568


$
7,207,409


$
1,622,791


$
1,198,348


$
8,923Interest payments


5,542,948



2,849,231



1,963,890



531,813



162,794



34,868



351Operating leases


102,264,692



3,773,720



3,815,037



3,893,601



3,966,958



4,016,618



82,798,758   Potential
    Sale of the Company
      Item 7A.
    Quantitative
    and Qualitative Disclosures about Market Risk   39




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data.  Report of
    Independent Registered Public Accounting Firm    Internal Control 
    Integrated Framework
        Internal Control  Integrated
    Framework
     40




---



##### Table of Contents



VCG
    Holding Corp.
  Consolidated
    Balance Sheets
  December 31,2009


2008AssetsCurrent AssetsCash

$
2,677,440


$
2,209,060Assets held for sale


-



106,900Other receivables


254,333



25,473Income taxes receivable


594,720



276,267Inventories


926,321



949,088Prepaid expenses


354,730



282,485Current portion of deferred income tax asset


76,920



171,000Total Current Assets


4,884,464



4,020,273Property and equipment, net


22,946,114



25,738,388Licenses, net


34,834,018



36,413,189Goodwill, net


2,279,045



2,453,122Trade names


452,000



619,000Favorable lease rights, net


1,647,968



1,705,364Non-compete agreements, net


23,898



40,933Non-current portion of deferred income tax asset


3,841,673



4,068,593Other long-term assets


241,993



567,181Total Assets

$
71,151,173


$
75,626,043Liabilities and EquityCurrent LiabilitiesAccounts payable  trade

$
1,750,940


$
847,493Accrued expenses


1,930,049



2,257,116Income taxes payable


67,917



-Current portion of capitalized lease


-



10,000Current portion of long-term debt


3,805,277



2,602,000Current portion of long-term debt, related party


62,067



1,024,000Deferred revenue


110,010



109,455Current portion of unfavorable lease rights


277,920



278,155Total Current Liabilities


8,004,180



7,128,219Long-Term LiabilitiesDeferred rent


1,628,301



845,136Unfavorable lease rights, net of current portion


6,156,123



6,425,626Capital lease, net of current portion


-



9,111Long-term debt, net of current portion


19,751,021



25,916,111Long-term debt, related party, net of current portion


7,129,018



6,915,098Total Long-Term Liabilities


34,664,463



40,111,082Commitments and Contingent Liabilities (Note 9 and
    12)EquityCommon stock $.0001 par value; 50,000,000 shares
    authorized;17,310,723 (2009) and 17,755,378 (2008) shares
    issued and outstanding


1,731



1,775Additional paid-in capital


51,932,082



52,557,047Accumulated deficit


(26,996,863
)


(27,732,554
)Total VCG Stockholders Equity


24,936,950



24,826,268Noncontrolling interests in consolidated partnerships


3,545,580



3,560,474Total Equity


28,482,530



28,386,742Total Liabilities and Equity

$
71,151,173


$
75,626,043    41




---



##### Table of Contents



VCG
    Holding Corp.
  Consolidated
    Statements of Operations
 For
    the years ended
  December 31,2009


2008RevenueSales of alcoholic beverages

$
22,877,141


$
26,242,303Sales of food and merchandise


1,868,576



2,502,393Service revenue


27,170,918



25,568,380Other income


3,123,399



3,379,595Total Revenue


55,040,034



57,692,671Operating ExpensesCost of goods sold


5,921,054



6,979,636Salaries and wages


13,780,775



13,461,173Other general and administrativeTaxes and permits


3,478,871



2,894,076Charge card and bank fees


797,340



869,210Rent


5,855,191



5,798,066Legal fees


1,465,638



1,100,991Other professional fees


2,215,655



2,787,789Advertising and marketing


2,805,260



2,921,327Insurance


1,655,280



1,712,036Utilities


1,032,494



1,104,047Repairs and maintenance


1,242,276



1,022,100Advisory fees related to change in control proposals


953,517



-Other


5,023,061



4,777,060Impairment of building and land


268,000



1,961,200Impairment of indefinite-lived intangible assets


1,741,000



27,323,855Impairment of goodwill


17,000



18,721,496Depreciation and amortization


1,712,311



1,698,804Total Operating Expenses


49,964,723



95,132,866Income (Loss) from Operations


5,075,311



(37,440,195
)Other Income (Expenses)Interest expense


(2,746,503
)


(3,091,642
)Interest expense, related party


(710,113
)


(669,509
)Interest income


7,382



23,381(Loss) gain on sale of assets


(74,669
)


(205,825
)Total Other Expenses


(3,523,903
)


(3,943,595
)Income (Loss) Before Income Taxes


1,551,408



(41,383,790
)Income tax expense (benefit)  current


(126,896
)


729,940Income tax expense (benefit)  deferred


465,896



(11,831,550
)Total Income Taxes


339,000



(11,101,610
)Net Income (Loss)


1,212,408



(30,282,180
)Net Income (Loss) Attributable to Noncontrolling Interests


476,717



428,614Net Income (Loss) Attributable to VCG

$
735,691


$
(30,710,794
)Earnings Per ShareBasic earnings (loss) per share attributable to VCGs
    stockholders

$
0.04


$
(1.71
)Fully diluted earnings (loss) per share attributable to
    VCGs stockholders

$
0.04


$
(1.69
)Basic weighted average shares outstanding


17,541,376



17,925,132Fully diluted weighted average shares outstanding


17,541,376



18,146,949    42




---



##### Table of Contents



VCG
    Holding Corp.
  Consolidated
    Statements of Equity
 For
    the years ended December 31, 2009 and 2008
  NoncontrollingAdditional





Interests in


TotalCommon Stock


Paid-in


Accumulated


Consolidated


StockholdersShares


Amount


Capital


Deficit


Partnerships


EquityRestated Balances, December 31, 2007


17,723,985


$
1,772


$
51,007,824


$
2,978,240


$
3,660,915


$
57,648,751Issuance of common stock for services


184,417



18



1,487,235



-



-



1,487,253Issuance of common stock for loan fee


7,000



1



36,539



-



-



36,540Exercise of warrants


167,000



17



459,250



-



-



459,267Repurchase of common stock


(327,024
)


(33
)


(753,169
)


-



-



(753,202
)Stock-based compensation


-



-



233,634



-



-



233,634Amortization of warrants for services


-



-



122,745



-



-



122,745Deferred offering costs


-



-



(37,011
)


-



-



(37,011
)Net loss for the year ended December 31, 2008


-



-



-



(30,710,794
)


428,614



(30,282,180
)Distributions paid to noncontrolling interests


-



-



-



-



(529,055
)


(529,055
)Balances, December 31, 2008


17,755,378



1,775



52,557,047



(27,732,554
)


3,560,474



28,386,742Amortization of warrants for services


-



-



102,288



-



-



102,288Stock-based compensation


-



-



142,095



-



-



142,095Repurchase of common stock


(444,655
)


(44
)


(869,348
)


-



-



(869,392
)Net income for the year ended December 31, 2009


-



-



-



735,691



476,717



1,212,408Distributions paid to noncontrolling interests


-



-



-



-



(491,611
)


(491,611
)Balances, December 31, 2009


17,310,723


$
1,731


$
51,932,082


$
(26,996,863
)

$
3,545,580


$
28,482,530    43




---



##### Table of Contents



VCG
    Holding Corp.
  Consolidated
    Statements of Cash Flows
 For
    the years ended
  For the Year EndedDecember 31,2009


2008Operating ActivitiesNet income (loss) attributable to VCG

$
735,691


$
(30,710,794
)Adjustments to reconcile net income (loss) to net cash provided
    by operating activities:Impairment of goodwill


17,000



18,721,496Impairment of indefinite lived intangible assets


1,741,000



27,323,546Impairment of building and land


268,000



1,961,200Depreciation


1,695,277



1,678,043Amortization of non-compete agreements


17,035



20,761Amortization of leasehold rights and liabilities, net


(212,342
)


(192,067
)Amortization of loan fees


216,205



448,015Stock-based compensation expense


244,383



421,379Issuance of stock for services


-



1,422,253Deferred income taxes


465,896



(11,831,550
)Noncontrolling interests


476,717



428,614(Gain) Loss on disposition of assets


74,669



216,539Accrued interest added to long-term debt


243,901



180,613Write-off uncollectible deposits


7,151



-Changes in operating assets and liabilities :Income taxes and other receivables


(287,894
)


152,135Inventories


22,767



20,030Prepaid expenses


(72,245
)


(6,480
)Accounts payable  trade and accrued expenses


576,380



693,896Income taxes payable


67,917



-Deferred revenue


555



(40,811
)Deferred rent


783,165



845,136Net cash provided by operating activities


7,081,228



11,751,954Investing ActivitiesAcquisitions of businesses, net of cash acquired


-



(9,670,691
)Additions to property and equipment


(1,454,478
)


(1,324,252
)Deposits


(19,444
)


(206,068
)Purchase of assets held for sale


-



(127,952
)Proceeds from sale of assets


238,241



243,131Net cash used by investing activities


(1,235,681
)


(11,085,832
)Financing ActivitiesProceeds from debt


1,212,115



14,009,000Payments on debt


(4,152,700
)


(13,345,601
)Proceeds from related party debt


25,099



2,140,000Payments on related party debt


(912,843
)


(949,900
)Borrowing (payments) on revolving line of credit


(90,000
)


(2,190,000
)Loan fees paid


(78,724
)


(268,218
)Payment on capital lease


(19,111
)


(9,343
)Proceeds from exercise of warrants


-



459,250Repurchase of stock


(869,392
)


(753,202
)Distributions to noncontrolling interests


(491,611
)


(529,055
)Net cash used by financing activities


(5,380,167
)


(1,437,069
)Net increase (decrease) in cash


465,380



(770,947
)Cash beginning of period


2,209,060



2,980,007Cash end of period

$
2,674,440


$
2,209,060Supplemental cash flow information:Income taxes paid in cash

$
225,972


$
822,307Interest paid in cash

$
3,067,195


$
3,108,962Non-cash acquisition activities:Issuance of notes payable for acquisitions

$
-


$
(5,793,027
)Fair value of liabilities assumed

$
-


$
(2,095,105
)Non-cash divestiture activities:Book value of note payable transferred to buyer

$
1,771,854


$
-Issuance of note receivable to buyer

$
322,963


$
-    44




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial Statements
  Index
  Note1.


Description of Business


462.


Summary of Significant Accounting Policies


463.


Inventories


514.


Acquisitions


525.


Property and Equipment


536.


Goodwill and Other Intangible Assets


547.


Other Long Term Assets


558.


Accrued Expenses


559.


Long-Term Debt


5510.


Income Taxes


5911.


Stockholders Equity


6012.


Commitments and Contingencies


6213.


Fair Value Disclosure


6714.


Subsequent Events


68  45




---



##### Table of Contents



VCG
    Holding Corp.
  Notes
    to Consolidated Financial Statements
  1)
    Description
    of Business    2)
    Summary
    of Significant Accounting Policies  Principles
    of Consolidation
    Use of
    Estimates
    Cash
    Asset
    Held for Sale
    Other
    Receivables
    Income
    Tax Receivable
    Inventories
  first-in,
 46




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Prepaid
    Expenses
    Property
    and Equipment
    YearsBuildings

39Leasehold improvements

The shorter of useful life or lease termVehicles

5Computers and software

5Equipment

3  10Furniture and Fixtures

3  7Signs

10       Goodwill
  Intangibles  Goodwill and Other
  Intangible
    Assets
      Favorable
    Lease Rights and Unfavorable Lease Rights
   47




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Deferred
    Revenue
    Deferred
    Rent
  Leases
  Revenue
    Recognition
  point-of-sale
    Advertising
    Cost
    Stock-Based
    Compensation
  Compensation-Stock Compensation ,
  Income
    Taxes
  Income Taxes
   48




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Earnings
    per Share
  Earnings per Share
    Years Ended December 31,2009


2008Net income

$
735,691


$
(30,710,794
)Basic weighted average shares outstanding


17,541,376



17,925,132Effect of dilutive securities:Stock warrants


-



221,817Stock options


-



-Dilutive weighted average shares outstanding


17,541,376



18,146,949Earnings per share:Basic

$
0.04


$
(1.71
)Diluted

$
0.04


$
(1.69
)       Reclassifications
    Fair
    Value of Financial Instruments
    Recently
    Issued Accounting Pronouncements
  tm
 49




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Fair Value Measurements and Disclosures
  Business Combinations
  Subsequent Events
  No. 2009-05, Fair Value Measurements and Disclosure Measuring Liabilities at Fair Value
  No. 2010-04, Accounting for Various Topics  Technical
    Corrections to SEC Paragraphs.
  Issued
    but not yet effective accounting standards
  Consolidation
 50




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Transfers and
    Servicing
    Consolidation
    of Variable Interest Entities
    Consolidation
  
    the Limited Partners have very limited rights with respect to
    the management and control of 4th Street;
    the Company is the General Partner; and therefore, has control
    of the partnership;
    the Company is the Primary Beneficiary;
    the Company has determined that 4th Street is a variable
    interest entity; and
    therefore, the Company has consolidated 4th Streets assets
    and included its equity as noncontrolling interest on the
    consolidated balance sheet.  360-20, Real Estate Sales 360-20)
  3)
    Inventories    51




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  December 312009


2008Food and beverage

$
823,165


$
841,154Tobacco and merchandise


103,156



107,934Total

$
926,321


$
949,088   4)
    Acquisitions    Cash

$
32,000Inventories


4,523Property and equipment


3,166,440Deposits and other assets


25,000Goodwill


2,259,581Licenses


3,501,000Non-compete agreement


8,000Unfavorable lease right


(1,390,000
)Deferred income taxes


(705,105
)Purchase price

$
6,901,439       Property and equipment

$
160,633Deposits and other assets


7,000Goodwill


380,037Trade name


276,000Licenses


6,546,000Favorable lease right


250,000Purchase price

$
7,619,670       52




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  December 31,Pro forma

2008Revenue

$
59,816,000Net income (loss)


(29,800,000
)Earnings per shareBasic

$
(1.66
)Diluted

$
(1.64
)   5)
    Property
    and Equipment    December 31,2009


2008Land

$
500,000


$
856,737Buildings


11,362,143



14,076,390Leasehold improvements


11,056,795



10,645,692Equipment


3,138,217



2,470,848Vehicles


269,503



138,090Signs


308,819



268,726Furniture and fixtures


1,993,370



1,918,126Assets to be placed in service


168,245



-28,797,092



30,374,609Less accumulated depreciation


(5,850,978
)


(4,636,221
)Property and equipment, net

$
22,946,114


$
25,738,388      53




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
   6)
    Goodwill
    and Other Intangible Assets    December 31,2009


2008Accumulated








AccumulatedCost


Amortization


Net


Cost


Amortization


NetAmortizable intangible assetsCovenant not to compete

$
61,694


$
(37,796
)

$
23,898


$
61,694


$
(20,761
)

$
40,933Favorable lease rights


1,820,000



(172,032
)


1,647,968



1,820,000



(114,636
)


1,705,364$
1,881,694


$
(209,828
)

$
1,671,866


$
1,881,694


$
(135,397
)

$
1,746,297       Year Ending December 31,2010

$
86,9272011


76,7552012


75,4922013


72,2922014


71,892Thereafter


1,288,508$
1,671,866     Goodwill


Licenses


Trade NamesBalance at December 31, 2007

$
17,622,000


$
53,316,734


$
578,000Club acquisitions in 2008


2,639,618



10,047,000



276,000Acquisition purchase price adjustments


1,057,898



138,310



-Component 2 amortization


(144,896
)


-



-2008 impairment charges


(18,721,496
)


(27,088,855
)


(235,000
)Balance  December 31, 2008


2,453,122



36,413,189



619,000Component 2 amortization


(157,077
)


(5,171
)


-2009 impairment charges


(17,000
)


(1,574,000
)


(167,000
)Balance at December 31, 2009

$
2,279,045


$
34,834,018


$
452,000      54




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
        7)
    Other
    Long-Term Assets    December 31,2009


2008Loan fees, net

$
108,866


$
246,347Deposits  lease, utility, and taxes


133,127



120,834Acquisition deposit


-



200,000$
241,993


$
567,181   8)
    Accrued
    Expenses    December 31,2009


2008Payroll and related expenses

$
1,225,526


$
832,802Sales taxes


282,007



297,449Property taxes


319,773



375,277Legal and professional charges


31,344



667,810Interest


54,772



83,778Rent


16,627



-Total

$
1,930,049


$
2,257,116   9)
    Long-Term
    Debt    Related Party
  December 31,Description of Related Party Debt

2009


2008Note payable to Lowrie Management LLLP, interest at 10%, due
    monthly, principal due June 2012, collateralized by general
    assets of Illinois Restaurant Concepts LP and Denver Restaurant
    Concepts LP, plus the consent to the transfer of the adult
    permit and liquor license for both clubs upon default.

$
5,700,000


$
- 55




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  December 31,Description of Related Party Debt

2009


2008Note payable to Lowrie Management LLLP, interest at 8.5%,
    monthly principal and interest payments of $112,841, due January
    2013, collateralized by general assets of Illinois Restaurant
    Concepts, LP and Denver Restaurant Concepts, LP and a security
    interest in the general assets of VCG Holding Corp. and consent
    to the transfer of the adult permit and liquor license for both
    clubs. This loan was consolidated into the new 10% loan in June
    2009.


-



4,754,394Note payable to Lowrie Family Foundation, a corporation
    controlled by the Companys Chairman of the Board and Chief
    Executive Officer, interest at 10%, interest accrued monthly to
    principal, but no payments, due February 2011, unsecured.


698,934



662,828Note payable to Lowrie Management LLLP, interest at 10%, due
    monthly, principal due April 2011, collateralized by the general
    assets of Denver Restaurant Concepts LP, general assets of
    Illinois Restaurant Concepts LP, and consent to the transfer of
    the adult permit and liquor license upon default in the name of
    Denver Restaurant Concepts LP and RCC LP. This loan was
    consolidated into the new 10% loan in June 2009.


-



1,335,805Note payable to the President and Chief Operating Officer with
    interest at 10%, due monthly, principal due February 2011,
    unsecured.


100,000



100,000Note payable to a board member with interest at 10%, due
    monthly, principal due November 2011, unsecured.


50,000



50,000Note payable to the mother of the Chairman with interest at 10%,
    due monthly, principal due February 2011, unsecured.


170,000



170,000Note payable to the mother of the Chairman, with interest at
    10%, monthly principal and interest payments of $3,456.22, due
    December 2010, unsecured.


36,741



72,571Note payable to the mother of the Chairman, with interest at
    10%, interest accrues monthly to principal, but no payments, due
    December 2010, unsecured.


25,326



-Note payable to the sister of Chairman, with interest at 10%,
    monthly interest payments of $3,167, due February 2010,
    collateralized by the general assets of Illinois Restaurant
    Concepts LP and Denver Restaurant Concepts LP and consent to the
    transfer of the adult permit and liquor license for both clubs
    upon default. In June 2009, the Company paid this loan in full.


-



380,000Note payable to an affiliate of a current Board member with
    interest at 10%, due February 2011, collateralized by a personal
    guarantee from Mr. Lowrie.


410,084



413,500Total debt due


7,191,085



7,939,098Less current portion, related party


(62,067
)


(1,024,000
)Total long-term debt, related party

$
7,129,018


$
6,915,098  56




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Third
    Party
  December 31,Description of Debt

2009


2008Note payable to Sunshine Mortgage, interest at 14% fixed, due
    monthly, periodic principal with balance due December 2011,
    collateralized by one parcel of real property located in
    Ft. Worth, TX, the common stock of Kenja II, Inc.,
    238,000 shares of VCG stock, furniture, fixtures and
    equipment of Kenja II, Inc. and a guarantee from Lowrie
    Management LLLP.

$
4,700,000


$
5,000,000Loan from Citywide Banks, interest at 7% fixed, monthly
    principal and interest payments of $76,865 due August 15,
    2014, collateralized with a life insurance policy on Troy Lowrie
    and additional securities owned by Mr. Lowrie.


3,654,865



-Note payable, interest at 8% fixed, monthly principal and
    interest payments, due July 2011, collateralized by assets of
    VCG-IS, LLC.


2,915,386



3,186,835Note payable to Amfirst Bank, variable interest rate calculated
    at prime subject to a 6% floor, actual rate of 6% at
    December 31, 2009, monthly principal and interest payments
    of approximately $55,898, due November 14, 2014,
    collateralized by UCC Security Agreement of RCC LP, IRC LP, MRC
    LP , Platinum of Illinois, Inc., Cardinal Management LP,VCG CO
    Springs, Inc., VCG Real Estate, Inc., Glendale Restaurant
    Concepts LP, Glenarm Restaurant LLC, the Indiana building, and a
    guarantee from Lowrie Management LLLP.


2,844,219



3,325,927Line of credit from Citywide Banks, variable interest rate
    calculated at prime subject to a 6% floor, actual rate of 6% at
    December 31, 2009, due monthly, principal due
    August 15, 2011, collateralized by Company shares of common
    stock owned by Lowrie Management LLLP, a life insurance policy
    on Troy Lowrie, and additional securities owned by
    Mr. Lowrie.


2,720,000



2,810,000Note payable, variable interest rate calculated at prime subject
    to a 6% floor, actual rate of 6% at December 31, 2008, due
    monthly, periodic principal payments with balance due June 2013,
    collateralized by a P&A Select Strategy Fund and securities
    owned by Lowrie Management LLLP. This loan was consolidated into
    a new loan in August 2009.


-



2,375,138Note payable to Citywide Banks, interest at 8.5%, monthly
    principal and interest payments of $36,156 with a balloon
    payment of $2,062,483 due May 16, 2010, collateralized by
    securities owned by Lowrie Management LLLP. This note was
    consolidated on August 15, 2009.


-



2,080,527Note payable, interest at 12% fixed, monthly principal and
    interest payments, with periodic principal payments, due May
    2010, collateralized by assets of Manana Entertainment, Inc. The
    Company paid this note in full in September 2009.


-



1,928,410Note payable, interest at a rate equal to the lesser
    of(i) twelve percent (12%) or (ii) the rate for ten
    (10) year Treasury Bills plus four percent (4%). Monthly
    principal and interest payments of $22,949 due September 2018,
    collateralized by certain real and personal property of
    Epicurean. The Company sold the AZ property in July 2009 and
    transferred this debt to the new owner. VCG agreed to guaranty
    the Buyers performance on the $1,772,000 mortgage note
    payable. The Buyer and its sole member agreed to indemnify VCG
    from any losses arising from its guaranty of the same mortgage
    note.


-



1,847,618 57




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##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  December 31,Description of Debt

2009


2008Notes payable to investors, interest at 11%, monthly interest
    payments, principal due January 2010, collateralized by the
    general assets of the Company and a guarantee by Mr. Lowrie.


1,400,000



1,400,000Notes payable, interest at 10% and 11% fixed, monthly interest
    payments, due November 2010, collateralized by the general
    assets and cash flow of VCG and 100% stock in Manana
    Entertainment, Inc.


1,336,529



250,000Notes payable, interest at 10%, monthly interest payments,
    principal due between November 2009 and March 2012, unsecured.


1,198,000



1,380,000Various notes payable, interest at 11% fixed, monthly interest
    payments, principal due July 2011, collateralized by the general
    assets and cash flow of VCG and 100% stock in VCG-IS, LLC and a
    guarantee from Mr. Lowrie.


1,000,000



1,000,000Note payable, interest at 12% fixed due monthly, periodic
    principal payments with balance due July 2011, collateralized by
    one parcel of real property located in Ft. Worth, TX and
    the common stock of Kenja II, Inc., and a guarantee from Lowrie
    Management LLLP.


1,000,000



1,000,000Note payable, interest at 10% fixed, monthly principal and
    interest payments, due October 2013, unsecured.


214,732



231,957Note payable to investors, interest at 8.5%, monthly principal
    and interest payments, due October 20, 2011, collateralized
    by the general assets of the Company and guaranteed by
    Mr. Lowrie.


208,295



308,993Note payable to employee, interest at 10%, due October 2011,
    unsecured.


186,122



168,480Auto loans payable, interest at 0%, monthly principal payments,
    due in May 2012 and October 2015, collateralized by the vehicles
    purchased.


102,317



-Note payable, variable interest rate calculated at prime subject
    to a 6% floor, actual rate of 6% at December 31, 2009, due
    monthly, principal and interest due January 2011, unsecured.


75,833



145,833Note payable, variable interest rate calculated at prime subject
    to a 6% floor, actual rate of 6% at December 31, 2009,
    principal and interest payments, due December 2009, unsecured.


-



78,393Total debt due


23,556,298



28,518,111Less current portion


(3,805,277
)


(2,602,000
)Total long-term debt

$
19,751,021


$
25,916,111   pre-approved
 58




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2010

$
3,867,3442011


16,942,5682012


7,207,4092013


1,622,7912014


1,198,348Thereafter


8,923$
30,847,383     10)
    Income
    Taxes    Year Ended December 31,2009


2008United States federal statutory rate


34.0
%


(34.0
)%State income taxes, net of Federal income tax benefit


5.2



(3.8
)Permanent differences


22.6



1.9Utilization of net operating loss


-



(0.4
)Tax credits


(37.5
)


(1.0
)Impairment of nondeductible goodwill


-



9.7Other


(2.4
)


0.821.9
%


(26.8
)%       December 31,2009


2008Licenses, goodwill and other intangible assets

$
1,195,738


$
1,170,697Favorable/unfavorable leases, net


1,866,569



2,718,507Property and equipment


(819,743
)


(26,868
)Accrued cost


76,920



100,105Net operating loss carryforwards


1,017,181



21,539Tax credits


581,928



255,613Net deferred tax asset

$
3,918,593


$
4,239,593  59




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
        11)
    Stockholders
    Equity  Common
    Stock
    Preferred
    Stock
  and/or
  Stock
    Option and Stock Bonus Plans
  and/or
  and/or
 60




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Shares to be


SharesIssued Upon


RemainingExercise of


Available forShares


Shares


Available


Outstanding


FutureAuthorized


Granted


for Grant


Options


Issuance2002 Stock Option and Stock Bonus Plan


700,000



699,776



224



-



2242003 Stock Option and Stock Bonus Plan


250,000



247,292



2,708



-



2,7082004 Stock Option and Appreciation Rights Plan


1,000,000



93,333



906,667



262,500



644,1671,950,000



1,040,401



909,599



262,500



647,099       Weighted-AverageOptions


Exercise PriceOutstanding at December 31, 2007


188,000


$
10.00Granted above fair market value


167,000



11.95Exercised


-



-Forfeited


(54,500
)


11.21Outstanding at December 31, 2008


300,500


$
10.37Granted


-



-Exercised


-



-Forfeited


(38,000
)


11.42Outstanding at December 31, 2009


262,500


$
10.21Exercisable at December 31, 2009


-



-       Valuation
    and Assumptions
  Stock Compensation
 61




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Option Grant Year2008


2007Expected life in years


6.07



6.07Weighted average expected volatility


62
%


61
%Weighted average risk free rates


3.5
%


4.6
%Dividend yield


-



-Weighted average grant date fair value

$
5.25


$
4.89     Stock
    Warrants
  The Company issued stock warrants in 2004 and
    2006.
  12)
    Commitments
    and Contingencies  Operating
    Leases
     62




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Year Ended December 31,

Related Party


Third Party


Total2010

$
462,000


$
3,311,720


$
3,773,7202011


462,000



3,353,037



3,815,0372012


477,000



3,416,601



3,893,6012013


477,000



3,489,958



3,966,9582014


481,500



3,535,118



4,016,618Thereafter


9,180,000



73,618,758



82,798,758Total minimum lease payments

$
11,539,500


$
90,725,192


$
102,264,692         month-to-month month-to-month
  Legal
    Proceedings
  Thee
    Dollhouse Productions Litigation
     63




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Zajkowski,
    et. al. vs VCG and Classic Affairs Litigation
        Texas
    Patron Tax Litigation
     64




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Department
    of Labor and Immigration and Customs Enforcement
    Reviews
  United
    States Department of Labor (DOL) Audit (PTs
    Showclub)
  ®
    Immigration
    and Customs Enforcement (ICE) Reviews
  ®
  Internal
    Revenue Service
  ®
   65




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Litigation
    Associated with the Proposed Going Private
    Transaction
  Form 8-K
         66




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Form 8-K
  Form 10-K, Form 8-K
      13)
    Fair
    Value of Financial Instruments  820-10 820-10
          825-10, Financial Instruments
 67




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    14)
    Subsequent
    Events  Long-term
    debt
    Potential
    Sale of the Company
  Form 8-K
  Form 8-K
 68




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Form 8-K
      out-of-pocket
 69




---



##### Table of Contents



VCG
    Holding Corp.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Form S-4
 70




---



##### Table of Contents



Item 9.
    Changes
    in and Disagreements With Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Effectiveness
    of Disclosure Controls and Procedures.
    Managements
    Annual Report on Internal Control over Financial
    Reporting.
  Rules 13a-15(f) 15d-15(f)
  
    pertain to the maintenance of records that, in reasonable
    detail, accurately and fairly reflect transactions and
    dispositions of our assets;
    provide reasonable assurance that transactions are recorded, as
    necessary, to permit preparation of financial statements in
    accordance with generally accepted accounting principles, and
    that our receipts and expenditures are being made only in
    accordance with authorizations of our management and
    directors; and
    provide reasonable assurance regarding prevention or timely
    detection of unauthorized acquisition, use or disposition of our
    assets that could have a material effect on the financial
    statements.      Changes
    in Internal Control Over Financial Reporting.
    Item 9B.
    Other
    Information   71




---



##### Table of Contents



PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance  Background
    of our Directors and Executive Officers
    Name

Age

PositionTroy Lowrie(4),(6)


44


Chairman of the Board and Chief Executive OfficerMicheal Ocello(4),(6)


50


Director, Chief Operating Officer, and PresidentCourtney Cowgill(7)


56


Chief Financial and Accounting Officer, Secretary, and TreasurerRobert McGraw, Jr.(2),(3),(5)


55


DirectorCarolyn Romero(1),(5)


51


DirectorMartin Grusin(6)


65


DirectorKenton Sieckman(1),(2),(3),(5)


48


DirectorGeorge Sawicki(1),(2),(3),(5)


50


Director     (1)
    
    Member of the Audit Committee(2)
    
    Member of the Governance and Nominating Committee(3)
    
    Member of the Compensation Committee(4)
    
    Member of the Executive Committee(5)
    
    Independent Board member(6)
    
    Non-independent Board member who is currently not serving on any
    Committee(7)
    
    Advisor to the Executive Committee and Chief Financial and
    Accounting Officer who joined the Company on June 19, 2008      Name

TermTroy Lowrie

2007 - 2010Micheal Ocello

2009 - 2012Robert McGraw Jr.

2007 - 2010Carolyn Romero

2009 - 2010Martin Grusin

2009 - 2012Kenton Sieckman

2008 - 2011George Sawicki

2008 - 2011   and/or
    Troy Lowrie.
 72




---



##### Table of Contents



Micheal Ocello. ® ® ® ® ® ®
  Courtney Cowgill.
  Robert McGraw, Jr.
 73




---



##### Table of Contents



Martin A. Grusin.
  George Sawicki. e-commerce,
  Kenton Sieckman.
  Carolyn Romero. 2008-2009.
 74




---



##### Table of Contents



Audit
    Committee
      
    oversees the work and compensation of the independent auditor;
    reviews the scope of the independent auditors audit
    examination, including its engagement letter prior to the annual
    audit, and reviews the audit fees agreed upon and any permitted
    non-audit services to be provided by the independent
    auditors; and
    recommends to the Board the retention or replacement of the
    independent auditors, which reports solely and directly to the
    Audit Committee.  Compensation
    Committee
    
    to develop, review, evaluate and recommend to the Board for its
    approval the Companys compensation and benefit policies,
    including the review and approval of the Companys
    incentive and equity-based compensation plans, or amendments to
    such plans; and
    to review and recommend to the Board for its approval
    compensation of the Companys Executive Officers
    including annual base salaries, annual incentive compensation,
    long-term incentive compensation, retirement benefits, if any,
    employment, severance, and
    change-in-control
    agreements.       75




---



##### Table of Contents



Governance
    and Nominating Committee
    
    assists the Board in identifying individuals qualified to become
    Board members and Committee members;
    recommends that the Board select the director nominees for
    election at the next annual or special meeting of stockholders
    at which directors are to be elected;
    recommends individuals to fill any vacancies or newly created
    directorships that occur on the Board or its Committees between
    any annual or special meeting of stockholders at which directors
    are to be elected;
    makes recommendations to the Board as to determinations of
    director independence;
    evaluates the Board and Committee structure, performance and
    composition;
    reviews, evaluates, recommends changes, and oversees compliance
    with the Companys corporate governance guidelines,
    including the Companys Code of Ethics; and
    performs other duties or responsibilities expressly delegated to
    the Governance and Nominating Committee by the Board relating to
    the nomination of Board or Committee members.    Section 16(a)Beneficial Ownership Reporting Compliance
     76




---



##### Table of Contents



Code
    of Ethics
    
    honest and ethical conduct, including the ethical handling of
    actual or apparent conflicts of interest between personal and
    professional relationships;
    full, fair, accurate, timely, and understandable disclosure in
    reports and documents that we file with, or submit to, the SEC
    and in other public communications made by us;
    compliance with applicable governmental laws, rules and
    regulations;
    prompt internal reporting of violations of the ethics code to an
    appropriate person or persons identified in the code; and
    accountability for adherence to the Code of Ethics.  www.vcgh.com
  Item 11.
    Executive
    Compensation  Executive
    Compensation
    NonqualifiedNon-Equity


DeferredStock


Options


Incentive Plan


Compensation


All OtherSalary


Bonus


Award(s)


Award(s)


Compensation


Earnings


Compensation


TotalName and Principal Position

Year


(a) ($)


(b) ($)


(c) ($)


(d) ($)


($)


($)


(f) ($)


($)Troy Lowrie


2009



700,000



-



-



-



-



-



92,449



792,449Chief Executive Officer


2008



292,307



-



75,003



-



-



-



42,370



409,680Micheal Ocello


2009



700,000



1,500



-



-



-



-



162,460



863,960President/Chief Operating Officer


2008



700,000



1,500



75,003



-



-



-



102,341



878,844Courtney Cowgill(e)


2009



190,000



26,500



-



-



-



-



14,763



231,263Chief Financial and Accounting Officer


2008



92,807



1,500



-



60,137



-



-



8,977



163,421     (a)
    
    Salary amounts represent base salary and payment for vacation,
    holidays, and sick days.(b)
    
    Unless otherwise indicated, bonuses shown were paid in the
    fiscal year in which services were provided.(c)
    
    On January 18, 2008, the Company issued 5,214 shares
    of the Companys common stock to each member of the
    Companys Board, including Mr. Lowrie and
    Mr. Ocello, in consideration for Board services provided
    from June 2007 to June 2008. The fair market value of each share
    of common stock at the time of grant was $9.59, the closing
    market price on the grant date. On October 2, 2008, the
    Company issued 7,375 shares of the Companys common
    stock to each member of the Companys Board, including
    Mr. Lowrie and Mr. Ocello, in consideration for Board
    services provided from June 2008 to December 2008. The fair
    market value of each share of common stock at the time of grant
    was $3.39, the closing market price on the grant date.(d)
    
    The amounts reported reflected the aggregate fair value of stock
    option awards granted during the fiscal year pursuant to our
    2004 Stock Option and Appreciation Rights Plan. Ms. Cowgill
    was awarded 25,000 stock options on June 19, 2008 with a
    calculated fair value of approximately $2.41 calculated using
    the
    Black-Scholes
    Option Pricing Model.(e)
    
    Ms. Cowgill joined the Company in June 2008. 77




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##### Table of Contents



(f)
    
    Amounts in the All Other Compensation Column consist
    of the following payments to or on behalf of the named executive
    officers:  Variable


Life, HealthUniversal Life


and DentalCar


Insurance


Insurance


BoardAllowance


Premiums


Premiums


Compensation


TotalName and Principal Position

Year


($) (a)


($) (b)


($) (c)


($) (d)


($)Troy Lowrie


2009



22,040



-



20,409



50,000



92,449Chief Executive Officer


2008



24,416



-



17,954



-



42,370Micheal Ocello


2009



22,051



58,673



31,736



50,000



162,460President/ Chief Operating Officer


2008



14,408



58,673



29,260



-



102,341Courtney Cowgill


2009



-



-



14,763



-



14,763Chief Financial and Accounting Officer


2008



-



-



8,977



-



8,977     (a)
    
    Certain executives and other employees receive monthly car
    allowances.(b)
    
    Variable universal life insurance is provided to Mr. Ocello
    and paid by the Company.(c)
    
    Life, health, and dental insurance is provided to all executives.(d)
    
    Mr. Lowrie and Mr. Ocello received cash compensation
    for their services on the Companys Board.  Outstanding
    Equity Awards at Fiscal Year End
    Number ofSecuritiesUnderlyingUnexercised


Option


OptionOptions (#)


Exercise


ExpirationName and Principal Position

Unexercisable


Price ($)


DateMicheal Ocello


30,000
(1)

$
10.00



10/12/2017President/ Chief Operating OfficerCourtney Cowgill


25,000
(2)

$
6.00



6/19/2018Chief Financial and Accounting Officer     (1)
    
    On October 12, 2007, the Company granted to Mr. Ocello
    options to purchase 30,000 shares of the Companys
    common stock. The options vest in three equal installments on
    the third, fifth, and seventh anniversaries of the date of grant.(2)
    
    On June 19, 2008, the Company granted to Ms. Cowgill
    options to purchase 25,000 shares of the Companys
    common stock. The options vest in three equal installments on
    the third, fifth, and seventh anniversaries of the date of grant.  Employment
    Contracts and Termination of Employment and Change in Control
    Arrangements
       78




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##### Table of Contents



non-solicitation,
     79




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##### Table of Contents



Potential
    Payments upon Termination or Change in Control
    Termination w/outCause, Non-RenewalChange in Controlor Quit with





Total


TerminationName and Principal Position

Benefit

Good Reason


Death


Disability


with CauseTroy Lowrie

Salary

$
2,100,000


$
700,000


$
700,000


$
-Chief Executive Officer

Board of Directors Compensation


50,000



-



-



-Bonus


-



-



-



-Health Benefits


61,227



61,227



61,227



-Acceleration of Options


-



-



-



-All Other Benefits


199,629



-



159,348



-Micheal Ocello

Salary


2,100,000



700,000



700,000



-President/ Chief Operating Officer

Board of Directors Compensation


50,000



-



-



-Bonus


1,500



1,500



1,500



-Health Benefits


61,227



61,227



61,227



-Acceleration of Options


-



-



-



-All Other Benefits


126,893



-



-



-All Other Benefits:Troy Lowrie

Disability Insurance


-



-



-



-Long Term Care Insurance


159,348



-



159,348



-Auto


40,281



-



-



-Retirement Plans


-



-



-



-Unused Vacation


-



-



-



-Club Memberships


-



-



-



-199,629



-



159,348



-Micheal Ocello

Disability and VUL Insurance


70,000



-



-



-Long Term Care Insurance


-



-



-



-Auto


56,893



-



-



-Retirement Plans


-



-



-



-Unused Vacation


-



-



-



-Club Memberships


-



-



-



-126,893



-



-



-  80




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##### Table of Contents



Compensation
    of our Directors
    Fees Earnedor Paidin Cash


TotalName and Principal Position

($)(1)


($)Robert McGraw Jr.(2)


62,500



62,500Carolyn Romero(3),(5)


34,792



34,792Martin Grusin


50,000



50,000Kenton Sieckman(2),(3)


67,500



67,500George Sawicki(2),(3)


69,500



69,500Allan Rubin(4)


31,250



31,250315,542



315,542     (1)
    
    Except for Mr. Rubin and Ms. Romero, all Board members
    received $50,000 as compensation for their service on the Board
    for their 2009/2010 term.(2)
    
    Messrs. McGraw, Sawicki, and Sieckman served as members of
    the Audit Committee and received an additional $12,500 for the
    2009/2010 term.(3)
    
    Messrs. Sawicki and Sieckman and Ms. Romero were each
    compensated $2,500 per month from November to December 2009 for
    their services as members of the Special Committee.
    Mr. Sawicki, as Chairman, of the Special Committee was
    compensated an additional amount of $1,000 each month.(4)
    
    Mr. Rubin resigned from the Board in August 2009 due to his
    lack of independence. The amount reflects payments to
    Mr. Rubin through his service on the Board.(5)
    
    Ms. Romero joined the board in August 2009. The amount
    reflects payments made to Ms. Romero for her services on
    Board and the Audit Committee, including $3,125 for her role as
    an independent financial expert.  Indemnification
    of Directors
   81




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##### Table of Contents



Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters  Stockholders
    beneficially owning more than 5% of the Companys common
    stock
    Amount


Percent ofand


CommonNature of


StockName and Address

Beneficial


Beneficiallyof Beneficial Owner(1)

Ownership


OwnedTroy Lowrie(2)


4,943,289



28.56
%390 Union Blvd, Suite 540Lakewood, CO 80228Lowrie Management LLLP


4,394,100



25.38
%390 Union Blvd, Suite 540Lakewood, CO 80228Whitebox Advisors, LLC, Whitebox Combined Advisors, LLC,
    Whitebox Combined Partners, L.P., Whitebox Multi-Strategy Fund,
    L.P., Whitebox Multi-Strategy Fund, Ltd., Whitebox Intermarket
    Advisors, LLC, Whitebox Intermarket Partners, L.P., Whitebox
    Intermarket Fund, L.P., Whitebox Intermarket Fund, Ltd., HFR RVA
    Combined Master Trust.(3)


1,380,498



7.97
%3033 Excelsior Boulevard, Suite 300Minneapolis, MN 55416     (1)
    
    Unless otherwise noted, all shares of common stock listed above
    are owned and registered in the name of each person listed as
    beneficial owner and such person has sole voting and dispositive
    power with respect to the shares of common stock beneficially
    owned by each of them. Pursuant to Exchange Act
    Rule 13d-3(d), shares not outstanding which are subject to
    options, warrants, rights or conversion privileges exercisable
    within 60 days of the record date are deemed outstanding
    for the purpose of calculating the number and percentage
    beneficially owned by such person, but are not deemed
    outstanding for the purpose of calculating the percentage
    beneficially owned by each other person listed.(2)
    
    Includes (i) 4,394,100 shares of common stock owned by
    Lowrie Management LLLP and (ii) 549,189 shares of
    common stock owned by Mr. Lowrie over which Mr. Lowrie
    has sole voting and dispositive power. Mr. Lowrie is the
    President of Lowrie Investment Management, Inc., the General
    Partner of Lowrie Management LLLP. Mr. Lowrie disclaims
    beneficial ownership of the shares owned by Lowrie Management
    LLLP, except to the extent of his pecuniary interest therein.(3)
    
    As reported by Whitebox Advisors, LLC on Schedule 13G filed
    with the SEC on February 8, 2010. 82




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##### Table of Contents



Security
    Ownership of our Directors and Executive Officers
    NumberBeneficially


PercentName and Address

Owned(1)


of ClassTroy Lowrie


4,943,289
(2)


28.56
%Micheal Ocello


195,589
(3)


1.13
%Courtney Cowgill


4,300
(4)


*Robert McGraw, Jr.


67,735
(6)


*Carolyn Romero


-



*Martin Grusin


86,319
(5)


*Kenton Sieckman


47,868
(7)


*George Sawicki


11,218



*All Executive Officers and Directors (as a group of eight
    persons)


5,356,318



30.94
%     *
    
    Represents less than 1%.(1)
    
    Unless otherwise noted, all shares of common stock listed above
    are owned and registered in the name of each person listed as
    beneficial owner and such person has sole voting and dispositive
    power with respect to the shares of common stock beneficially
    owned by each of them. Pursuant to Exchange Act
    Rule 13d-3(d), shares not outstanding which are subject to
    options, warrants, rights, or conversion privileges exercisable
    within 60 days of the Record Date are deemed outstanding
    for the purpose of calculating the number and percentage
    beneficially owned by such person, but are not deemed
    outstanding for the purpose of calculating the percentage
    beneficially owned by each other person listed.(2)
    
    Includes (i) 4,394,100 shares of common stock owned by
    Lowrie Management LLLP and (ii) 549,189 shares of
    common stock owned by Mr. Lowrie over which Mr. Lowrie
    has sole voting and dispositive power. Mr. Lowrie is the
    President of Lowrie Investment Management, Inc., the General
    Partner of Lowrie Management LLLP. Mr. Lowrie disclaims
    beneficial ownership of the shares owned by Lowrie Management
    LLLP, except to the extent of his pecuniary interest therein.
    Mr. Lowrie has pledged 2,325,900 shares of stock as
    collateral on two of the Companies current notes.(3)
    
    Includes (i) 158,000 shares of common stock owned by
    LTD Investment Group, LLC, of which Mr. Ocello is the
    Managing Member and (ii) 37,589 shares of common stock
    owned by Mr. Ocello over which Mr. Ocello has sole
    voting and dispositive power. This does not include
    30,000 shares of common stock underlying options to
    purchase stock that are currently not exercisable within
    60 days of the Record Date. Mr. Ocello has not pledged
    any of his stock as collateral.(4)
    
    Includes (i) 4,300 shares of common stock owned by
    Ms. Cowgill over which Ms. Cowgill has sole voting and
    dispositive power. This does not include 25,000 shares of
    common stock underlying options to purchase stock that are
    currently not exercisable within 60 days of the Record
    Date. Ms. Cowgill has not pledged any of her stock as
    collateral.(5)
    
    Includes (i) 10,000 shares beneficially owned by ACM
    Management, LLC, of which Mr. Grusin does not have sole
    voting power but is the Chief Manager,
    (ii) 66,319 shares owned by Mr. Grusin over which
    Mr. Grusin has sole voting and dispositive power, and
    (iii) 10,000 shares held by Mr. Grusins
    wife, Ms. Gayle Powelson. Mr. Grusin has not pledged
    any of his stock as collateral.(6)
    
    Includes (i) 65,735 shares owned by Mr. McGraw
    over which Mr. McGraw has sole voting and dispositive power
    and (ii) 2,000 shares held by Mrs. Marjorie
    McGraw, Mr. McGraws wife. Mr. McGraw has not
    pledged any of his stock as collateral. 83




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##### Table of Contents



(7)
    
    Includes (i) 47,118 shares owned by Mr. Sieckman
    over which Mr. Sieckman has sole voting and dispositive
    power and (ii) 750 shares held by
    Mr. Sieckmans son. Mr. Sieckman has not pledged
    any of his stock as collateral.  Securities
    Authorized for Issuance under Equity Compensation
    Plans
    Number of SecuritiesRemaining Available forNumber of Securities





Future Issuance Underto be Issued Upon


Weighted-average


Equity CompensationExercise of


Exercise Price of


PlansOutstanding


Outstanding


(Excluding SecuritiesOptions


Options


Reflected in Column (a))Plan Category

(a)


(b)


(c)Equity compensation plans approved by security holders


262,500
(3)

$
10.21



644,391
(1)Equity compensation plans not approved by security holders


-0-



-0-



2,708
(2)Total


262,500


$
10.21



647,099     (1)
    
    The Company adopted a 2002 Stock Option and Stock Bonus Plan,
    which was approved by its stockholders on July 22, 2002,
    and reserved 700,000 shares of common stock for issuance
    under the plan. In addition, the Company adopted a 2004 Stock
    Option and Appreciation Rights Plan, which was approved by its
    stockholders on July 29, 2005, and reserved
    1,000,000 shares of common stock for issuance under the
    plan. Shares of common stock may be issued either: (i) upon
    the exercise of stock options granted under the plans; or
    (ii) as stock bonuses granted under the plans. If there is
    any change in the number of shares of common stock through the
    declaration of stock dividends, or through a recapitalization
    resulting in stock splits, or combinations or exchanges of such
    shares, the number of shares of common stock available for
    options and the number of such shares covered by outstanding
    options, and the exercise price per share of the outstanding
    options, shall be proportionately adjusted to reflect any
    increase or decrease in the number of issued shares of common
    stock; provided, however, that any fractional shares resulting
    from such adjustment shall be eliminated.(2)
    
    The Company adopted a 2003 Stock Option and Stock Bonus Plan and
    reserved 250,000 shares of common stock for issuance under
    the plan. These shares have been registered under the Securities
    Act of 1933, as amended, pursuant to a registration statement on
    Form S-8.(3)
    
    The Company has issued 262,500 options to employees under the
    2002 and 2004 Stock Option and Stock Bonus Plans.  Equity
    Incentive Plans
      
    Under both the 2002 and the 2003 Plans, we may grant to our
    designated employees, Officers, Directors, advisors and
    consultants incentive stock options, nonqualified stock options
    and stock. Under the 2004 Plan, we may grant to our designated
    employees, Officers, Directors, advisors and consultants
    incentive stock options, nonqualified stock options and stock
    appreciation rights. As applicable, stock grants and stock 84




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##### Table of Contents



appreciation rights may be made to employees, officers,
    directors and consultants of the Company and its subsidiaries,
    including any non-employee members of the Board. Incentive stock
    options may be granted only to employees of the Company.
    Nonqualified stock options may be granted to employees,
    officers, directors and consultants.  
    If options granted under either plan expire or are terminated
    for any reason without being exercised, or bonus shares are
    forfeited, the shares underlying such option
    and/or bonus
    shares will become available again for issuance under the
    respective plan.
    The Compensation Committee determines which individuals will
    receive grants, the type, size and terms of the grants, the time
    when the grants are made and the duration of any applicable
    exercise or restriction period, including the criteria for
    vesting and the acceleration of vesting, and the total number of
    shares of common stock available for grants. The exercise price
    of an option may be equal to, greater than, or less than the
    fair market value of a share of common stock at the time of
    grant; provided that:        
    The Compensation Committee determines the term of each option,
    which may not exceed ten years from the date of grant, except
    that the term of an incentive stock option granted to an
    employee who owns more than 10% of the issued and outstanding
    common stock may not exceed five years from the date of grant.
    The Compensation Committee may accelerate or extend the
    exercisability of any or all outstanding options at any time for
    any reason.
    The Compensation Committee determines the number of shares of
    stock granted to a participant and may subject any grant to
    performance requirements, vesting provisions, transfer
    restrictions and other restrictions and conditions.    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence  Review,
    Approval or Ratification of Transactions with Related
    Persons
      
    whether the terms of the related party transaction are fair to
    the Company and such terms would be on the same basis if the
    transaction did not involve a related party; 85




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##### Table of Contents




    whether there are business reasons for the Company to enter into
    the related party transaction;
    whether the related party transaction would impair the
    independence of an independent Director;
    whether the related party transaction would present an improper
    conflict of interest for any Director or Executive Officer of
    the Company, taking into account: (i) the size of the
    transaction, (ii) the overall financial position of the
    Director or Executive Officer, (iii) the direct or indirect
    nature of the Directors or Executive Officers
    interest in the transaction, and (iv) the ongoing nature of
    any proposed relationship, and any other factors deemed
    relevant; and
    whether the related party transaction is material, taking into
    account: (i) the importance of the interest to the related
    party, (ii) the relationship of the related party to the
    transaction and of related parties to each other, (iii) the
    dollar amount involved, and (iv) the significance of the
    transaction to the Companys investors in light of all of
    the circumstances.        Guarantees
  and/or
 86




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##### Table of Contents



December 31,Description of Transactions

2009


2008Note payable to Sunshine Mortgage, interest at 14% fixed, due
    monthly, periodic principal with balance due December 2011,
    collateralized by one parcel of real property located in
    Ft. Worth, TX, the common stock of Kenja II, Inc.,
    238,000 shares of VCG stock, furniture, fixtures and
    equipment of Kenja II, Inc. and a guarantee from Lowrie
    Management LLLP.

$
4,700,000


$
5,000,000Loan from Citywide Banks, interest at 7% fixed, monthly
    principal and interest payments of $76,865, due August 15, 2014,
    collateralized with a life insurance policy on Troy Lowrie and
    additional securities owned by Mr. Lowrie.


3,654,865



-Note payable to Amfirst Bank, variable interest rate calculated
    at prime subject to a 6% floor, actual rate of 6% at December
    31, 2009, monthly principal and interest payments of
    approximately $55,898, due November 14, 2014, collateralized by
    UCC Security Agreement of RCC LP, IRC LP, MRC LP , Platinum of
    Illinois, Inc., Cardinal Management LP, VCG CO Springs, Inc.,
    VCG Real Estate, Inc., Glendale Restaurant Concepts LP, Glenarm
    Restaurant LLC, the Indiana building, and a guarantee from
    Lowrie Management LLLP.


2,844,219Line of credit from Citywide Banks, variable interest rate
    calculated at prime subject to a 6% floor, actual rate of 6% at
    December 31, 2009, due monthly, principal due August 15, 2011,
    collateralized by Company shares of common stock owned by Lowrie
    Management LLLP, a life insurance policy on Troy Lowrie, and
    additional securities owned by Mr. Lowrie.


2,720,000



2,810,000Note payable, variable interest rate calculated at prime subject
    to a 6% floor, actual rate of 6% at December 31, 2008, due
    monthly, periodic principal payments with balance due June 2013,
    collateralized by a P&A Select Strategy Fund and securities
    owned by Lowrie Management LLLP.  This loan was consolidated
    into a new loan in August 2009.


-



2,375,138Note payable Citywide Banks, interest at 8.5%, monthly principal
    and interest payments of $36,156 with a balloon payment of
    $2,062,483 due May 16, 2010, collateralized by securities owned
    by Lowrie Management LLLP. This note was consolidated on August
    15, 2009.


-



2,080,527Notes payable to investors, interest at 11%, monthly interest
    payments, due January 2010, collateralized by the general assets
    of the Company and a guarantee by Mr. Lowrie.


1,400,000



1,400,000Note payable, interest at 12% fixed due monthly, periodic
    principal payments with balance due July 2011, collateralized by
    one parcel of real property located in Ft. Worth, TX and
    the common stock of Kenja II, Inc., and a guarantee from Lowrie
    Management LLLP.


1,000,000



1,000,000Various notes payable, interest at 11% fixed, monthly interest
    payments, due July 2011, collateralized by the general assets
    and cash flow of VCG and 100% stock in VCG-IS, LLC and a
    guarantee from Mr. Lowrie.


1,000,000



-Note payable to an affiliate of a current Board member with
    interest at 10%, due February 2011, collateralized by a personal
    guarantee from Mr. Lowrie.


410,084



413,501Note payable to investors, interest at 8.5%, monthly principal
    and interest payments, due October 20, 2011, collateralized by
    the general assets of the Company and guaranteed by Mr. Lowrie.


208,295



308,993Total debt due

$
17,937,463


$
15,388,159  87




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##### Table of Contents



Trademarks
  ® ®
  Long-Term
    Debt
             88




---



##### Table of Contents



Other
    Transactions
  ®
  ®
  ®
  Director
    Independence
  ® ®
    ®
 89




---



##### Table of Contents



Item 14.
    Principal
    Accountant Fees and Services      2009


2008Audit fees

$
194,118


$
172,000Audit-related fees


45,350



10,000Tax fees


2,625



6,675All other fees


12,237



637Total

$
254,330


$
189,312   Audit
    fees
    Audit-related
    fees
    Tax
    Fees
    Other
    Audit
    Committees Pre-Approval Policies and
    Procedures
   90




---



##### 



PART IV  Item 15.
    Exhibits
    and Financial Statement Schedules  Form 10-K:
  Financial
    Statements
   
 Page No.Report of Independent Registered Public
    Accounting Firm


40Consolidated Balance Sheets as of
    December 31, 2009 and 2008


41Consolidated Statements of Operations for the
    Years Ended December 31, 2009 and 2008


42Consolidated Statement of Equity for the Years
    Ended December 31, 2009 and 2008


43Consolidated Statements of Cash Flows for the
    Years Ended December 31, 2009 and 2008


44Notes to Consolidated Financial Statements


45EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1EX-32.2    Financial
    Statement Schedules
    Exhibits
  ExhibitsNo.

Description3
.1

Articles of Incorporation(1)3
.2

Amended Designations, Preferences, Limitations and Relative
    Rights of Series A Convertible Preferred Stock(9)3
.3

Amended and Restated Bylaws(28)4
.1

Specimen common stock certificate, $.0001 par value(1)4
.2

Specimen preferred stock certificate $.0001 par value(1)*4
.3

Stock Option and Stock Bonus Plan(1)*4
.4

2003 Stock Option and Stock Bonus Plan(3)4
.5

Form of Subscription Agreement(16)10
.01

Trademark License Agreement, dated June 30, 2002, between
    VCG Holding Corp. and Lowrie Management LLLP(1)10
.02

Line of Credit and Security Agreement, dated June 30, 2002,
    between VCG Holding Corp. and Lowrie Management LLLP(1)*10
.03

Management Contract, dated May 2, 2002, between VCG Holding
    Corp. and International Entertainment Consultants, Inc.(1)10
.04

Lease Agreement for
    213-215
    Madison, Brooklyn, Illinois, dated May 1, 2002, by and
    between RELMSS and VCG Holding Corp.(1)10
.05

Agreement to Purchase/Sell Real Estate, dated March 5,
    2003, between VCG Real Estate Holdings, Inc. and Sacred Grounds
    Resources, L.L.C.(2) 91




---



##### Table of Contents



ExhibitsNo.

Description10
.06

Limited Partnership Purchase Agreement, executed effective
    June 30, 2004, by and among VCG Holding Corp., WCC
    Acquisitions, Inc. and Lowrie Management LLLP(4)10
.07

Promissory Note and Security Agreement, dated July 21,
    2004, by VCG Holding Corp. in favor of Lowrie Management LLLP(4)10
.08

Lease Agreement, dated October 1, 2004, by and between
    Lowrie Management LLLP and Glendale Restaurant Concepts LP(5)10
.09

Agreement for the Purchase and Sale of Assets, dated
    August 18, 2004, by and between CCCG, Inc. and Glenarm
    Restaurant Concepts, LLC(6)10
.10

Lease Agreement, dated August 31, 2004, by and between
    Glenarm Associates, Inc. and Glenarm Restaurant LLC(6)10
.11

First Amendment to Commercial Lease, dated February 1,
    2005, by Hampden and Galena Limited and VCG Restaurants Denver,
    Inc.(7)*10
.12

2004 Stock Option and Appreciation Rights Plan(8)10
.13

Agreement for the Purchase and Sale of Business and Assets,
    dated August 2, 2006, by and between VCG Holding Corp. and
    Consolidated Restaurants Limited, LLC(10)10
.14

Business Lease, dated October 2, 2006, by and between 5975
    Terminal, LLC and VCG CO Springs, Inc.(11)10
.15

Limited Partnership Purchase Agreement, dated December 18,
    2006, by and among Lowrie Management LLLP and W.C.C.
    Acquisitions Inc., VCG Holding Corp. and Denver Restaurants
    Concepts, LP(12)10
.16

Promissory Note and Security Agreement, dated December 31,
    2006, by VCG Holding Corp. in favor of Lowrie Management LLLP(12)10
.17

Lease, dated January 1, 2005, by and between Lowrie
    Management LLLP and Denver Restaurant Concepts LP(12)10
.18

Sale of VCGs 100% Membership Interest in Epicurean
    Enterprises, L.L.C., dated January 15, 2007, by and between
    VCG Holding Corp and Cory James Anderson(13)10
.19

Lease, dated January 15, 2007, by and between VCG Real
    Estate Holdings Inc. and Epicurean Enterprises LLC(13)10
.20

Purchase Agreement, dated January 2, 2007, by and among
    Troy Lowrie, VCG Holding Corp and Kentucky Restaurants Concepts,
    Inc.(14)10
.21

Agreement for Sale of Limited Partnership Interest Restaurant
    Concepts of Kentucky Limited Partnership, dated January 2,
    2007(14)10
.22

Lease, dated January 1, 2007, by and between Lowrie
    Management LLLP and Kentucky Restaurant Concepts, Inc.(14)10
.23

Limited Partnership Purchase Agreement, dated January 18,
    2007, by and among Lowrie Management LLLP and Illinois
    Acquisitions Inc., VCG Holding Corp and RCC, LP(15)10
.24

Consent to Sell Partnership Interest of RCC, LP, dated
    January 31, 2007(15)10
.25

Consent to Transfer Partnership Interest into Common Stock,
    dated January 31, 2007(15)10
.26

Business Lease, dated February 1, 2007, by and between Jay
    Dinkelmann, as Trustee of Chicago Title Land Trust #1080459
    and RCC LP(15)10
.27

Limited Partnership Purchase Agreement, dated February 5,
    2007, by and among Lowrie Management LLLP, Illinois Acquisitions
    Inc., VCG Holding Corp. and Cardinal Management LP(16)10
.28

Business Lease, dated February 1, 2007, by and between Jay
    Dinkelmann, as Trustee of Chicago Title Land Trust #879-51
    and Cardinal Management LP dba PTs Centreville(16)10
.29

Limited Partnership Purchase Agreement, dated February 9,
    2007, by and among Lowrie Management LLLP and Illinois
    Acquisitions Inc., VCG Holding Corp and MRC, LP(17)10
.30

Promissory Note and Security Agreement, dated March 31,
    2007, by VCG Holding Corp. in favor of Lowrie Management
    LLLP(17) 92




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##### Table of Contents



ExhibitsNo.

Description10
.31

Business Lease, dated March 1, 2007, by and between Jay
    Dinkelmann as Trustee of Chicago Title Land Trust #1083191
    and MRC, LP.(17)10
.32

Limited Partnership Purchase Agreement, dated February 7,
    2007, by and among Lowrie Management LLLP, Illinois Acquisitions
    Inc., VCG Holding Corp. and IRC, LP(18)10
.33

Promissory Note, dated March 31, 2007, by VCG Holding Corp
    in favor of Lowrie Management LLLP(18)10
.34

Consent to Sell Partnership Interest of IRC, LP, dated
    February 21, 2007(18)10
.35

Business Lease, dated March 1, 2007, by and between Regions
    Bank, as Trustee of Trust #39007440 and Omni Warehouse, Inc. and
    IRC, LP.(18)10
.36

Promissory Note and Security Agreement, dated June 1, 2006,
    by VCG Holding Corp. in favor of Lowrie Management LLLP(20)10
.37

Agreement for the Purchase and Sale of Assets, dated
    March 23, 2007, by and among Regale, Inc., VCG Holding
    Corp. and Raleigh Restaurant Concepts, Inc.(20)10
.38

Agreement of Sublease, dated April 16, 2007, by and between
    Regale, Inc. and Raleigh Restaurant Concepts, Inc.(21)10
.39

Lease Agreement, dated April 16, 2007, by and between Big
    Deck Parking, LLC and Raleigh Restaurant Concepts, Inc.(21)10
.40

Stock Purchase Agreement, dated April 25, 2007, by and
    between Robert W. Sabes and VCG Holding Corp.(22)10
.41

Real Estate Purchase Agreement, dated April 25, 2007, by
    and between JFS Desert Fountain Properties, LLC and VCG Holding
    Corp.(22)10
.42

Lease, dated May 31, 2007, by and between JFS Desert
    Fountain Properties, LLC and Classic Affairs, Inc.(22)10
.43

Lease, dated June 29, 2007, by and between 4th Street
    Partnership, LLLP and Classic Affairs, Inc.(23)10
.44

Stock Purchase Agreement re: Kenkev II, Inc. f/k/a Mark R. Dean,
    Inc., dated September 14, 2007, between Ken-Kev Inc. and
    VCG Holding Corp.(24)10
.45

Restrictive Covenant  Covenant Not to Compete, dated
    September 14, 2007, between Gregory Kenwood Gaines and VCG
    Holding Corp.(24)10
.46

Consulting-License Agreement, dated September 14, 2007, by
    and between Alliance Management Partners, LLC and VCG Holding
    Corp. on behalf of Seller Equity holding(24)10
.47

Business Lease, dated September 14, 2007, by and between
    K & R Properties, Inc. and KenKevII, Inc.(24)10
.48

Guaranty of Lease, dated September 14, 2007, by VCG Holding
    Corp. in favor of K & R Properties(24)10
.49

Purchase of Membership Interest, dated September 17, 2007,
    by and among VCG Holding Corp. and Golden Productions JGC
    Fort Worth, LLC, d/b/a Jaguars Gold Club
    Fort Worth, and Bryan S. Foster(25)10
.50

Covenant not to compete, dated September 17, 2007, between
    Bryan S. Foster and VCG Holding Corp.(25)10
.51

Covenant not to compete, dated September 17, 2007, between
    Richard Richardson and VCG Holding Corp.(25)10
.52

Deed of Ground Lease, dated September 17, 2007, by and
    between VCG Holding Corp. and Bryan S. Foster(25)10
.53

Stock Purchase Agreement, dated October 29, 2007, by and
    among VCG Holding Corp. and Manana Entertainment, Inc. db/a
    Jaguars Gold Club Dallas, and Bryan S. Foster(26)10
.54

Covenant Not to Compete, made and effective as of the Effective
    Date, as defined in the Stock Purchase Agreement by and among
    VCG Holding Corp. and Manana Entertainment, Inc. d/b/a
    Jaguars Gold Club Dallas and Bryan S. Foster, between
    Bryan S. (Niko) Foster and VCG Holding Corp.(26)10
.55

Covenant Not to Compete, made and effective as of the Effective
    Date, as defined in the Stock Purchase Agreement by and among
    VCG Holding Corp. and Manana Entertainment, Inc. d/b/a
    Jaguars Gold Club Dallas and Bryan S. Foster, between
    Richard Richardson and VCG Holding Corp.(26) 93




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##### Table of Contents



ExhibitsNo.

Description10
.56

Stock Purchase Agreement Re: Kenja II, Inc. f/k/a Mark R. Dean,
    Inc., dated September 14, 2007, between Kenja II, Inc. and
    VCG Holding Corp.(26)10
.57

Restrictive Covenant  Covenant Not to Compete, dated
    October 29, 2007, between Gregory Kenwood Gaines and VCG
    Holding Corp.(26)10
.58

Bonus Agreement Related to Purchase Agreement, dated
    September 14, 2007, between G. Kenwood Gaines and VCG
    Holding Corp.(26)10
.59

Ground Lease Agreement, dated October 29, 2007, between VCG
    Holding Corp. and Bryan S. Foster(26)10
.60

Business Lease Agreement, dated October 29, 2007, by and
    between Third Properties, LLC and Kenja II, Inc.(26)10
.61

Guaranty of Lease, dated October 29, 2007, by VCG Holding
    Corp. in favor of Third Property, Inc.(26)10
.62

Balloon Promissory Note dated December 4, 2007, in favor of
    Sunshine Mortgage Investors, Inc.(27)10
.63

Agreement for Purchase and Sale of Assets, dated
    December 5, 2007, by and between 1443 Corp., Inc. and Stout
    Restaurant Concepts, Inc.(29)10
.64

Assignment Agreement, dated December 21, 2007, by and
    between VVSM, Inc. and VCG Holding Corp.(29)10
.65

Non-Competition Agreement, dated December 21, 2007, by and
    between 1443 Corp., Inc., Lance Migliaccio, Gidget Sanders, Ted
    R. Bullard and Stout Restaurant Concepts, Inc.(29)10
.66

Agreement for the Purchase and Sale of Assets, dated
    December 21, 2007, by and between 1447, Inc. and Bradshaw
    Hotel, Inc.(29)10
.67

Assignment and Assumption of Building Lease, dated
    December 19, 2007, by and between P.P.P., LLC, Lance C.
    Migliaccio, Gidget Bridget Sanders, Anthony Scott Falcone, Frank
    Henry Walley, IV, Ted R. Bullard and Stout Restaurant Concepts,
    Inc.(29)10
.68

Building Lease, dated July 7, 2001, by and between Dikeou
    Realty and 2222, Inc., as amended(29)10
.69

Consulting Agreement, dated December 4, 2007, by and
    between Lance C. Migliaccio and VCG Holding Corp.(29)10
.70

Indemnification Agreement, dated as of December 21, 2007,
    by and between 1443 Corp., Inc., Lance C. Migliaccio, Gidget
    Bridget Sanders, Anthony Scott Falcone, Frank Henry Walley, IV,
    Ted R. Bullard and VCG Holding Corp.(29)10
.71

Agreement of Merger, dated February 9, 2008 by and between
    VCG Holding Corp. and Mega Club(30)10
.72

Agreement and Plan of Reorganization, dated
    February 9,2008, by and between VCG Holding Corp and Mega
    Club(30)10
.73

Covenant Not to Compete, dated February 9, 2008, between
    Mega Club and VCG Holding Corp.(30)10
.74

Covenant not to Compete, dated February 9, 2008, between
    Mega Club Employee and VCG Holding Corp.(30)10
.75

Sales Agreement, dated February 9, 2008, between Mega Club
    and VCG Holding Corp.(30)10
.76

Ground Lease Agreement, dated February 9, 2008, between VCG
    Holding Corp. and Mega Club(30)10
.77

Agreement of Purchase of Assets, dated March 15, 2008, by
    and between VCG Holding Corp. and Mega Club(31)10
.78

Covenant Not to Compete, dated March 15, 2008, by and
    between VCG Holding Corp. and Mega Club(31)10
.79

First Amendment to Stock Purchase Agreement, dated
    April 15, 2008, by VCG Holding Corp. and Manana
    Entertainment, Inc. and Bryan Foster(36)10
.80

Promissory Note, dated April 14, 2008, by and between VCG
    Holding Corp. and Bryan Foster(36)10
.81

Security Agreement, dated April 14, 2008, by and between
    VCG Holding Corp. and Bryan Foster(32)10
.82

Leasehold Deed of Trust Security Agreement, dated
    April 14, 2008(32)10
.83

Amended Balloon Promissory Note, dated July 11, 2008, by
    and between VCG Holding Corp. and Sunshine Mortgage Investors,
    Inc.(33) 94




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##### Table of Contents



ExhibitsNo.

Description10
.84

Balloon Promissory Note, dated, July 14, 2008, by and
    between VCG Holding Corp. and Richard Stanton(33)10
.85

Asset Purchase Agreement, dated March 15, 2008, by and
    between 2640 W. Woodland Inc., and Glenn Smith, and
    VCG-IS, LLC, and VCG Holding Corp.(34)10
.86

Covenant Not to Compete, dated July 28, 2008, by and
    between Glenn Smith and VCG-IS, LLC(34)10
.87

Promissory Note, dated July 28, 2008, by and between
    VCG-IS, LLC and 2640 W. Woodland, Inc.(34)10
.88

Security Agreement, dated July 28, 2008, by and between
    VCG-IS, LLC and 2640 W. Woodland, Inc.(34)10
.89

Promissory Note and Security Agreement, dated November 11,
    2007, by VCG Holding Corp. in favor of Lowrie Management LLLP(35)10
.90

Promissory Note and Security Agreement, dated July 17,
    2008, by VCG Holding Corp. in favor of Vali Lowrie Reed(35)*10
.91

Employment Agreement, dated December 4, 2008, by and
    between VCG Holding Corp. and Troy Lowrie(36)*10
.92

Employment Agreement, dated December 4, 2008, by and
    between VCG Holding Corp. and Micheal Ocello(36)10
.93

Agreement of Merger, dated February 9, 2008 by and between
    VCG Holding Corp. and TTNA, Inc.(37)10
.94

Agreement and Plan of Reorganization, dated
    February 9,2008, by and between VCG Holding Corp and TTNA,
    Inc.(37)10
.95

Covenant Not to Compete, dated February 9, 2008, by and
    between VCG Holding Corp and Duncan Burch(37)10
.96

Covenant not to Compete, dated February 9, 2008, between
    TTNA, Inc. Employee and VCG Holding Corp(37)10
.97

Sales Agreement, dated February 9, 2008, between Duncan
    Burch and VCG Holding Corp(37)10
.98

Ground Lease Agreement, dated February 9, 2008, between VCG
    Holding Corp. and Duncan Burch(37)10
.99

Promissory Note and Security Agreement, dated June 30,
    2009, by VCG Holding Corp. in favor of Lowrie Management LLLP(38)11
.00

Real Estate Purchase Agreement, dated July 31, 2009 , by
    and between Black Canyon Highway LLC and VCG Real Estate
    Holding(39)11
.01

Promissory Note dated August 15, 2009, by VCG Holding Corp.
    in favor of Citywide Banks(40)11
.02

Promissory Note dated August 15, 2009, by VCG Holding Corp.
    in favor of Citywide Banks(40)11
.03

Business Lease Agreement, dated August 15, 2009 by and
    between VCG Holding Corp and Lowrie Management LLLP and Citywide
    Banks(40)11
.04

Change in Terms Agreement, dated August 15, 2009 by and
    between VCG Holding Corp and Citywide Banks(40)11
.05

Business Lease Agreement, dated August 15, 2009 by and
    between VCG Holding Corp and Lowrie Management LLLP and Citywide
    Banks(40)11
.06

Indemnification Agreement, dated as of December 16, 2009,
    by and between VCG Holding Corp, Troy Lowrie, Micheal Ocello,
    Courtney Cowgill, Martin Grusin, Robert McGraw, Jr., Kenton
    Sieckman, George Sawicki and Carolyn Romero(41)11
.07

Letter of Intent between Ricks Cabaret International,
    Inc., VCG Holding Corp., Troy Lowrie and Lowrie Management
    LLLP(42)21
.1

Subsidiaries of VCG Holding Corp.(44)23
.1

Consent of Causey Demgen & Moore Inc.(44)31
.1

Certification of Chief Executive Officer of VCG Holding Corp.
    required by
    Rule 13a-14(1)
    or
    Rule 15d-14(a)
    of the Securities Exchange act of 1934, as adopted pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002(44) 95




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##### Table of Contents



ExhibitsNo.

Description31
.2

Certification of Chief Financial Officer of VCG Holding Corp.
    required by
    Rule 13a-14(1)
    or
    Rule 15d-14(a)
    of the Securities Exchange act of 1934, as adopted pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002(44)32
.1

Certification of Chief Executive Officer of VCG Holding Corp.
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    and Section 1350 of 18 U.S.C. 63(43)32
.2

Certification of Chief Financial Officer of VCG Holding Corp.
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    and Section 1350 of 18 U.S.C. 63(43)     (1)
    
    Incorporated by reference from Registration Statement on
    Form SB-2
    filed on September 10, 2002(2)
    
    Incorporated by reference from Amendment No. 2 to the
    Registration Statement on
    Form SB-2
    filed on April 21, 2003(3)
    
    Incorporated by reference from the Companys Registration
    Statement on
    Form S-8
    filed August 6, 2003(4)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on July 29, 2004(5)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on October 8, 2004(6)
    
    Incorporated by reference from Amended Current Report on
    Form 8-K/A
    filed on October 18, 2004(7)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on February 9, 2005(8)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on August 1, 2005(9)
    
    Incorporated by reference from the Companys Quarterly
    Report on
    Form 10-Q
    filed on November 14, 2005(10)
    
    Incorporated by reference from the Companys Quarterly
    Report on
    Form 10-Q
    filed on August 14, 2006(11)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on October 5, 2006(12)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on January 5, 2007(13)
    
    Incorporated by reference from Current Report on
    Form 8-K
    on January 19, 2007(14)
    
    Incorporated by reference from Current Report on
    Form 8-K
    on January 23, 2007(15)
    
    Incorporated by reference from Current Report on
    Form 8-K
    on February 15, 2007(16)
    
    Incorporated by reference from the Companys Registration
    Statement on
    Form S-3
    filed March 1, 2007(17)
    
    Incorporated by reference from Current Report on
    Form 8-K
    on March 6, 2007(18)
    
    Incorporated by reference from Current Report on
    Form 8-K
    on March 21, 2007(19)
    
    Incorporated by reference from Current Report on
    Form 8-K
    on March 23, 2007(20)
    
    Incorporated by reference from the Annual Report on
    Form 10-KSB
    filed April 3, 2007(21)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on April 20, 2007(22)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on June 7, 2007(23)
    
    Incorporated by reference from Current Report on
    Form 8-K/A
    filed on July 12, 2007(24)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on September 20, 2007(25)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on September 21, 2007(26)
    
    Incorporated by reference from Current Report on
    Form 8-K/A
    filed on November 16, 2007(27)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on December 10, 2007(28)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on December 27, 2007(29)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on December 28, 2007(30)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed on February 14, 2008 & Current Report on
    Form 8-K
    filed February 3, 2009(31)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed March 20, 2008 & Current Report on
    Form 8-K
    filed February 3, 2009(32)
    
    Incorporated by reference from Current Report on
    Form 8-K/A
    filed April 18, 2008 96




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##### Table of Contents



(33)
    
    Incorporated by reference from Current Report on
    Form 8-K/A
    filed July 21, 2008(34)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed August 1, 2008(35)
    
    Incorporated by reference from Quarterly Report on
    Form 10-Q
    filed August 11, 2008(36)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed December 10, 2008(37)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed February 3, 2009(38)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed July 2, 2009(39)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed August 5, 2009(40)
    
    Incorporated by reference from Quarterly Report on
    Form 10-Q
    filed November 11, 2009(41)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed December 17, 2009(42)
    
    Incorporated by reference from Current Report on
    Form 8-K
    filed February 16, 2010(43)
    
    Furnished herewith(44)
    
    Filed herewith*
    
    Indicates a management contract or compensation plan or
    arrangement 97




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##### Table of Contents



SIGNATURES      By:
    /s/  Troy
    Lowrie        March 12, 2010

By: /s/  Troy
    LowrieTroy LowrieChairman of the Board andChief Executive OfficerMarch 12, 2010

By: /s/  Micheal
    OcelloMicheal OcelloDirectorChief Operating Officer and PresidentMarch 12, 2010

By: /s/  Courtney
    CowgillCourtney CowgillChief Financial OfficerSecretary and TreasurerMarch 12, 2010

By: /s/  Robert
    McGraw, Jr.Robert McGraw, Jr.DirectorMarch 12, 2010

By: /s/  Carolyn
    RomeroCarolyn RomeroDirectorMarch 12, 2010

By: /s/  Martin
    GrusinMartin GrusinDirectorMarch 12, 2010

By: /s/  George
    SawickiGeorge SawickiDirectorMarch 12, 2010

By: /s/  Kenton
    SieckmanKenton SieckmanDirector  98