Document:

ex10_1.htm

    
      
        

      

    

    EXHIBIT
10.1

    

    PURCHASE
AGREEMENT

    

    This
Purchase Agreement (the “Agreement”) is made and entered into this 15th day of
April, 2008, by and among Don Waitt (“Waitt” or “Seller”), ED Publications,
Inc., a Texas corporation
(“ED” or the “Company”) and Rick’s Cabaret International, Inc., a Texas
corporation (“Rick’s”), and its wholly owned subsidiary, RCI Entertainment
(Media Holdings), Inc., a Texas corporation (the “Buyer”).

    

    WHEREAS, Seller owns 100% of
the issued and outstanding common stock of the Company (the “ED Stock”);
and

    

    WHEREAS, the Company owns and
operates the publications listed on Exhibit
“A” (the “Publications”); and

    

    WHEREAS, the Company owns the
rights to the trade show commonly known as Exotic Dancer Gentlemen’s Club Owners
Expo (hereinafter referred to as the “Exotic Dancer Trade Show”);
and

    

    WHEREAS, the Seller desires to
sell 100% of the issued and outstanding ED Stock to Buyer on the terms and
conditions set forth herein; and

    

    WHEREAS, Buyer desires to
purchase 100% of the issued and outstanding ED Stock from Seller on the terms
and conditions set forth herein.

    

    NOW, THEREFORE, in
consideration of the premises, the mutual covenants and agreements and the
respective representations and warranties herein contained, and on the terms and
subject to the conditions herein set forth, the parties hereto, intending to be
legally bound, hereby agree as follows:

    

    

    ARTICLE
I

    PURCHASE
AND SALE OF THE ED STOCK

    AND
EXOTIC DANCER TRADE SHOW

    

    Section
1.1    Sale of the ED
Stock.  Subject to the terms and conditions set forth in this
Agreement, on the Closing Date (as hereinafter defined) Seller hereby agrees to
sell, transfer, convey and deliver to Buyer 1,000 shares of the Company which
represents 100% of the issued and outstanding common stock of the Company free
and clear of all encumbrances, and shall deliver to Buyer certificates
representing the ED Stock, duly endorsed to Buyer or accompanied by duly
executed stock powers in form and substance satisfactory to Buyer.

    

    Section
1.2    Conveyance of Rights to
Exotic Dancer Trade Show.  Subject to the terms and conditions
set forth in this Agreement, at the Closing (as hereinafter defined), the
Company hereby agrees that it has all rights, agreements and contracts to the
Exotic Dancer Trade Show and by the conveyance of the ED Stock to Buyer that the
Company is transferring, conveying and delivering to Buyer all rights in and to
the Exotic Dancer Trade Show.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    Section
1.3    Purchase Price for the ED
Stock.  As consideration for the purchase of the ED Stock,
Buyer shall pay to Seller as follows:

    

    
      	
               
      

            	
              (a)

            	
              Payment at the Closing
      or six months after Closing:

            

    

    

    
      	
               
      

            	
              (i)

            	
              $300,000
      by cashier’s check, certified funds or wire transfer at
      Closing;

            

    

    
      	
               
      

            	
              (ii)

            	
              $200,000
      by cashier’s check, certified funds or wire transfer payable six (6)
      months after Closing; and

            

    

    
      	
               
      

            	
              (iii)

            	
              8,696
      shares of restricted common stock of Rick’s at
  Closing.

            

    

    

    
      	
               
      

            	
              (b)

            	
              Earn Out
      Payment:

            

    

    

    During
the three (3) year period following the Closing Date (the “Earn Out Period”),
the Seller shall be entitled to earn additional consideration (the “Additional
Consideration”) up to a maximum amount of $2,000,000 (the “Maximum Amount”),
consisting of $500,000 cash (the “Cash”) and 65,217 shares of restricted common
stock of Rick’s valued at $23.00 per share (the “Earn Out Shares”), based upon
the earnings before income tax, depreciation and amortization (“EBITDA”) of the
Buyer.  Buyer will pay the Maximum Amount of the Additional
Consideration to Seller, if the Buyer’s EBITDA during the three (3) year period
following the Closing Date totals an aggregate of $2,400,000.  At the
end of each twelve (12) month period after the Closing Date (each such period
hereinafter referred to as a “Twelve Month Anniversary”), the Buyer shall
determine its EBITDA based upon the financial statements of the Buyer for such
Twelve Month Anniversary.  In the event that there is EBITDA during
that Twelve Month Anniversary, then the Seller shall be entitled to receive a
percentage of the Additional Consideration, up to the Maximum Amount of
$2,000,000, based upon the following formula:  the amount of EBITDA
during such Twelve Month Anniversary divided by $2,400,000, to be paid 25% in
Cash and 75% in the Earn Out Shares.  By way of illustration only, if
the EBITDA of the Buyer during the first Twelve Month Anniversary is $1,200,000,
then Buyer shall be entitled to Additional Consideration of $1,000,000, payable
$250,000 in cash and 32,609 Earn Out Shares.  The Earn Out Period
shall terminate three (3) years after the Closing Date. In no event shall the
Seller be entitled to any Additional Consideration in excess of the Maximum
Amount.

    

    The
shares of common stock issued to the Seller at Closing and the Earn Out Shares,
if any, issued to the Seller are hereinafter collectively referred to as the
“Rick’s Transaction Shares.”

    

    Section
1.4    Right of Seller to “Put”
Rick’s Transaction Shares.

    
      
         

      

      
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Agreement - Page 2

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (a)

            	
              On
      or after one (1) year from the date of Closing, or with respect to
      the  Earn Out Shares, if any, on or after seven (7) months from
      the date of issuance by Rick’s of the Earn Out Shares, the Seller shall
      have the right, but not the obligation, to have Rick’s purchase from the
      Seller 5,000 Rick’s Transaction Shares per month (the “Monthly Shares”)
      calculated at a price per share equal to $23.00 per share (“Value of the
      Shares”) until the Seller has received an aggregate of $1,700,000 (i) from
      the sale of the Rick’s Transaction Shares sold by Seller, regardless of
      whether sold to Rick’s, sold in the open market or in a private
      transaction or otherwise and (ii) the payment of any Deficiency (as
      hereinafter defined) by Rick’s.  The Seller shall notify Rick’s
      during any given month of  the Seller’s election to “Put” the
      Monthly Shares to  Rick’s during that particular month and
      Rick’s shall have three (3) business days to elect to buy the Monthly
      Shares or instruct the Seller to sell the Monthly Shares in the open
      market.  At Rick’s election, during any given month, it may
      either buy the Monthly Shares or if Rick’s elects not to buy the Monthly
      Shares from Seller, then Seller may sell the Monthly Shares in the open
      market and any deficiency between the amount which Seller receives from
      the sale of the Monthly Shares and the Value of the Rick’s Shares (the
      “Deficiency”) shall be paid by Rick’s within three (3) business days after
      receipt of written notice from the Seller of the sale of the Monthly
      Shares which shall provide the written sales confirmation in the amount of
      the Deficiency.  Rick’s obligation under this Section 1.4 to
      purchase any of the Rick’s Transaction Shares from the Seller shall
      terminate and cease at such time as the Seller has received an aggregate
      of $1,700,000 (assuming all Earn Out Shares have been issued) from (i) the
      sale of the Rick’s Transaction Shares, regardless of whether sold to
      Rick’s, sold in the open market or in a private transaction or otherwise,
      and (ii) the payment of any Deficiency by Rick’s.  The Seller
      agrees to provide monthly statements to Rick’s as to the total number of
      Rick’s Transaction Shares which Seller sold and the amount of proceeds
      derived therefrom.  Nothing contained in this Section 1.4 shall
      limit or preclude the Seller from selling his Rick’s Transaction Shares in
      the open market or require the Seller to “Put” his Rick’s Transaction
      Shares to Rick’s during any given month.  In the event that
      Seller elects to sell his Rick’s Transaction Shares pursuant to this
      Section 1.4 and any amount sold at prices less than $23.00 per share shall
      be deemed to be sold at $23.00 per share for purposes of this Section
      1.4.

            

    

    

    
      	
               
      

            	
              (b)

            	
              By
      entering into this Agreement, Rick’s agrees to collateralize its
      obligations under Section 1.3(a)(ii) and Section 1.4(a) above by placing
      the ED Stock as collateral for the payment of its obligations due under
      Section 1.3(a)(ii) and for any Deficiency which it is obligated to pay the
      Seller pursuant to Section 1.4(a) above.  In the event that (1)
      Rick’s fails to pay its obligations due under Section 1.3(a)(ii) or (2)
      fails to pay the Deficiency, then the Seller shall provide written notice
      to Rick’s of such failure to make such payment (the “Deficiency
      Notice”).  If Rick’s fails to pay the sum due pursuant to
      Section 1.3(a)(ii) or the Deficiency to Seller within ten (10) business
      days of receipt of the Deficiency Notice then the Seller may foreclose
      upon the collateral and take possession of the ED
  Stock.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Seller
      and Rick’s will enter into an agreement which will provide that in the
      event that the Seller elects not to “Put” the Rick’s Shares to Rick’s as
      set forth in Section 1.4(a) above, that Sellers will not sell more than
      10,000 Rick’s Transaction Shares in any 30-day period and no more than
      70,000 Rick’s Transaction Shares in any 90-day
  period.

            

    

    
      
         

      

      
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    ARTICLE
II

    CLOSING

    

    Section
2.1    The
Closing.  The closing of the transactions provided for in this
Agreement shall take place on or before April ___, 2008 (the “Closing Date”), or
at such other time and place as agreed upon in writing among the parties hereto
(the “Closing”).  The parties have agreed further to close at the
corporate office of Rick’s located at 10959 Cutten Road, Houston,
Texas  77066.

    

    Section
2.2    Delivery and
Execution.  At the Closing: (a) the Seller shall deliver to
Buyer certificates evidencing the ED Stock, free and clear of any liens, claims,
equities, charges, options, rights of first refusal or encumbrances, duly
endorsed to Buyer or accompanied by duly executed stock powers in form and
substance satisfactory to Buyer against delivery by Buyer to the Seller of
payment in an amount equal to the Purchase Price set forth in Section 1.3(a);
and (b) the Related Transactions (as defined below) shall be consummated
concurrently with the Closing.

    

    Section
2.3    Related
Transactions.  At Closing:

    

    
      	
               
      

            	
              (a)

            	
              the
      Seller will enter into a five (5) year covenant not to compete pursuant to
      the terms of which the Seller will agree not to compete, either directly
      or indirectly, with ED, Rick’s or Buyer or any of its affiliates by
      publishing any sexually oriented industry publications;
  and

            

    

    

    
      	
               
      

            	
              (b)

            	
              the
      Seller and Buyer will enter into a three (3) year Employment Agreement
      with an annual salary of $250,000.

            

    

    

    

    ARTICLE
III

    REPRESENTATIONS
AND WARRANTIES

    OF
THE SELLER AND ED

    

    The
Seller and ED, jointly and severally, hereby represent and warrant to the Buyer
as follows:

    

    Section
3.1    Organization, Good Standing
and Qualification.

    

    
      	
               
      

            	
              (a)

            	
              ED
      (i) is duly organized, validly existing and in good standing under the
      laws of the state of Texas, (ii) ED has the requisite power and authority
      to own, operate and lease its properties and to carry on its business, and
      (iii) ED is duly qualified to transact business and is in good standing in
      all jurisdictions where its ownership, lease or operation of property or
      the conduct of its business requires such qualification, except where the
      failure to do so would not have a material adverse effect to the Seller or
      ED, respectively.

            

    

    
      
         

      

      
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              (b)

            	
              The
      authorized capital of ED consists of 1,000 shares of common stock, all of
      which are validly issued and outstanding to the Seller.  There
      is no other class of capital authorized or issued by ED.  All of
      the issued and outstanding ED Stock are owned by the Seller and are fully
      paid and non-assessable.  None of the shares of ED Stock issued
      are in violation of any preemptive rights.  ED has no obligation
      to repurchase, reacquire, or redeem any of its outstanding common
      stock.  There are no outstanding securities convertible into or
      evidencing the right to purchase or subscribe for any common stock of ED,
      there are no outstanding or authorized options, warrants, calls,
      subscriptions, rights, commitments or any other agreements of any
      character obligating ED to issue any common stock or any securities
      convertible into or evidencing the right to purchase or subscribe for any
      common stock, and there are no agreements or understandings with respect
      to the voting, sale, transfer or registration of any common stock of
      ED.

            

    

    

    Section
3.2    Ownership of the ED
Stock.  The Seller owns, beneficially and of record, all of the
ED Stock free and clear of any liens, claims, equities, charges, options, rights
of first refusal, or encumbrances.  The Seller has the unrestricted
right and power to transfer, convey and deliver full ownership of the ED Stock
without the consent or agreement of any other person and without any
designation, declaration or filing with any governmental
authority.  Upon the transfer of the ED Stock to Buyer as contemplated
herein, Buyer will receive good and valid title thereto, free and clear of any
liens, claims, equities, charges, options, rights of first refusal, encumbrances
or other restrictions (except those imposed by applicable securities
laws).

    

    Section
3.3    Authorization.  ED
has all requisite corporate power and authority to execute and deliver this
Agreement and to perform its obligations hereunder and to consummate the
transactions contemplated hereby.  All action on the part of ED
necessary for the authorization, execution, delivery and performance of this
Agreement and all documents related to consummate the transactions contemplated
herein have been taken or will be taken prior to the Closing Date by ED. This
Agreement, when duly executed and delivered in accordance with its terms, will
constitute legal, valid and binding obligations of ED enforceable against them
in accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization and other similar laws of general application
affecting creditors’ rights generally or by general equitable
principles.

    

    The
Seller represents that he is a person of full age of majority, with full power,
capacity, and authority to enter into this Agreement and perform the obligations
contemplated hereby by and for himself and his spouse (if
applicable).  All action on the part of the Seller necessary for the
authorization, execution, delivery and performance of this Agreement by him has
been taken and will be taken prior to Closing Date.  This Agreement,
when duly executed and delivered in accordance with its terms, will constitute
legal, valid and binding obligations of the Seller enforceable against him in
accordance with its terms, except as may be limited by bankruptcy, insolvency,
reorganization and other similar laws of general application affecting
creditors’ rights generally or by general equitable principles.

    

    Section
3.4    Consents.  No
consent of, approval by, order or authorization of, or registration, declaration
or filing by ED or the Seller with any court or any governmental or regulatory
agency or authority having jurisdiction over the ED, or any of their respective
property or assets is required on the part of ED or the Sellers (a) in
connection with the consummation of the transactions contemplated by this
Agreement or (b) as a condition to the legality, validity or enforceability as
against ED of this Agreement, excluding any registration, declaration or filing,
the failure to effect which would not have a material adverse effect on the
financial condition of ED.

    
      
         

      

      
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    Section
3.5    Acquisition of Stock for
Investment.  The Seller understands that any issuance of the
Rick’s Transaction Shares will not have been registered under the Securities Act
of 1933, as amended (the “Act”), or any state securities acts, and accordingly,
are restricted securities, and the Seller represents and warrants to the
Buyer  that the present intention of the Seller is to receive and hold
the Rick’s Transaction Shares for investment only and not with a view to the
distribution or resale thereof.

    

    Additionally,
the Seller understand that any sale of any the Rick’s Transaction Shares issued,
under current law, will require either (a) the registration of the Rick’s
Transaction Shares under the Act and applicable state securities acts; (b)
compliance with Rule 144 of the Act; or (c) the availability of an exemption
from the registration requirements of the Act and applicable state securities
acts.

    

    To assist
in implementing the above provisions, the Seller  hereby consents to
the placement of the legend, or a substantially similar legend, set forth below,
on all certificates representing ownership of the Rick’s Transaction Shares
acquired hereby until the Rick’s shares have been sold, transferred, or
otherwise disposed of, pursuant to the requirements hereof.  The
legend shall read substantially as follows:

    

    “THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY APPLICABLE STATE SECURITIES ACTS.  THESE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT, ARE RESTRICTED AS TO TRANSFERABILITY, AND MAY
NOT BE SOLD, HYPOTHECATED, OR OTHERWISE TRANSFERRED WITHOUT COMPLIANCE WITH THE
REGISTRATION AND QUALIFICATION PROVISIONS OF APPLICABLE FEDERAL AND STATE
SECURITIES LAWS OR APPLICABLE EXEMPTIONS THEREFROM.”

    

    Section
3.6    Access to
Information.  The Seller hereby confirms and represents that he
(a) has received a copy of Rick’s Form 10-KSB filed with the Securities and
Exchange Commission (the “SEC”) for the year ended September 30, 2007, and a
copy of Rick’s Form 10-QSB for the quarter ended December 31, 2007, as filed
with the SEC; (b) has received a copy of Rick’s Form 14C filed with the SEC on
June 27, 2007; (c) has received a copy of the Forms 8-K filed with the SEC on
February 13, 2008, March 7, 2008, April 3, 2008 and April 4, 2008, and the Forms
8-K/A filed on January 29, 2008, February 11, 2008, and March 18, 2008; (d) has
been afforded the opportunity to ask questions of and receive answers from
representatives of  Rick’s concerning the business and financial
condition, properties, operations and prospects of Rick’s; (e) has such
knowledge and experience in financial and business matters so as to be capable
of evaluating the relative merits and risks of the transactions contemplated
hereby; (f) has had an opportunity to engage and is represented by an attorney
of his choice; (g) has had an opportunity to negotiate the terms and conditions
of this Agreement; (h) has been given adequate time to evaluate the merits and
risks of the transactions contemplated hereby; and (i) has been provided with
and given an opportunity to review all current information about
Rick’s.  The Seller has asked such questions to representatives of
Rick’s about Rick’s as he desires to ask and all such questions have been
answered to the full satisfaction of the Seller.  The forms filed by
Rick’s with the SEC as set forth in Section 3.6(a), (b) and (c) are hereafter
collectively referred to as “SEC Reports”.

    
      
         

      

      
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    Section
3.7    Purchase for
Investment.  The Seller is acquiring the Rick’s Transaction
Shares for his own accounts, for investment purposes only and not with view to
any public resale or other distribution thereof.  The Seller
represents and warrants that he is an Accredited Investor as that term is
defined in Rule 501(a) of Regulation D of the Securities Act of 1933, as
amended.  The Seller and his respective representatives have received,
or have had access to, and have had sufficient opportunity to review, all books,
records, financial information and other information which the Seller considers
necessary or advisable to enable him to make a decision concerning its
acquisition of the Rick’s Transaction Shares, and that he possesses such
knowledge and experience in financial and business matters so that he is capable
of evaluating the merits and risks of his investment hereunder.

    

    Section
3.8    No
Default.  ED is not (a) in violation of any provision of its
Articles of Incorporation or Bylaws, (b) in default under any term or condition
of any instrument evidencing, creating or securing any indebtedness of ED, and
there has been no default in any material obligation to be performed by ED under
any other contract, lease, agreement, commitment or undertaking to which it is a
party or by which it or its assets or properties are bound, nor has ED waived
any material right under any such contract, lease, agreement, commitment or
undertaking.

    

    Section
3.9    Taxes.  ED
has timely and accurately filed all federal, state, foreign and local tax
returns and reports required to be filed prior to such dates and has timely paid
all taxes shown on such returns as owed for the periods of such returns,
including all sales taxes and withholding or other payroll related taxes shown
on such returns and any taxes required to have been withheld and paid in
connection with amounts paid or owing to any employee, creditor or independent
contractor.  ED has made adequate provision for the payment of all
taxes accruable for all periods ending on or before the Closing Date to any
taxing authority and are not delinquent in the payment of any tax or
governmental charge of any nature.  No assessments or notices of
deficiency or other communications have been received by ED or the Seller with
respect to any tax return which has not been paid, discharged or fully reserved
against and no amendments or applications for refund have been filed or are
planned with respect to any such return. Neither ED nor the Seller has knowledge
of any action by any taxing authority in connection with assessing additional
taxes against or in respect of it for any past period.  There are no
agreements between ED and any taxing authority waiving or extending any statute
of limitations with respect to any tax return.

    

    Section
3.10    Financial
Statements.  The Seller has delivered to Buyer the financial
information available relating to ED (the “Financial
Information”).  Such Financial Information is in accordance with the
books and records of ED, and fairly represent the financial position of ED and
the results of operations and changes in financial position of ED as of the
dates and for the periods indicated.  ED does not have, as of the date
of the Financial Information, any material liability or obligation of any
nature, whether absolute, accrued, continued or otherwise.  As of the
Closing Date, the Seller represents there have been no adverse changes in the
financial condition or other operations, business, properties or assets of ED
from that reflected in the latest Financial Information of ED as furnished
pursuant to this Agreement.

    
      
         

      

      
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    Section
3.11    Labor
Matters.  ED is not a party or otherwise subject to any
collective bargaining agreement with any labor union or
association.  Except as noted on Exhibit
3.11, ED is not a party to any written or oral contract, agreement or
understanding for the employment of any officer, director or employee of
ED.  ED is not a party to any employee benefits plans (as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended)
or any other fringe or employee benefits plan, programs or
arrangements.

    

    Section
3.12    Compliance with Laws;
Permits.  ED is, and at all times prior to the date hereof have
been in compliance with all statutes, orders, rules, ordinances and regulations
applicable to it or to the ownership of its assets or the operation of its
businesses.

    

    Section
3.13    No
Conflicts.  The execution and delivery by ED and the Seller of
this Agreement does not, and the performance and consummation by ED and the
Seller of the transactions contemplated hereby will not (i) conflict with the
articles of incorporation or bylaws of ED; (ii) conflict with or result in a
breach or violation of, or default under, or give rise to any right of
acceleration or termination of, any of the terms, conditions or provisions of
any note, bond, lease, license, agreement or other instrument or obligation to
which ED is a party or by which the assets or properties of ED are bound; (iii)
result in the creation of any encumbrance on any of the assets or properties of
ED; or (iv) violate any law, rule, regulation or order applicable to ED or the
Seller or any of the  assets or properties of ED.

    

    Section
3.14    Title to Properties;
Encumbrances.  ED has good and marketable title to all of the
personal property and assets, that are used in the business that are material to
the condition (financial or otherwise), business, operations or prospects of ED,
including all Publications and  the Exotic Dancer Trade Show, free and
clear of all mortgages, claims, liens, security interests, charges, leases,
encumbrances and other restrictions of any kind and nature, except (i) as
disclosed in the Financial Statements of ED, (ii) statutory liens not yet
delinquent, and (iii) such liens consisting of zoning or planning restrictions,
imperfections of title, easements, pledges, charges and encumbrances, if any, as
do not materially detract from the value or materially interfere with the
present use of the property or assets subject thereto or affected
thereby.  ED does not own any real property.

    

    Section
3.15    No Pending
Transactions.  Except for the transactions contemplated by this
Agreement, neither ED nor the Seller is a party to or bound by or the subject of
any agreement, undertaking, commitment or discussions or negotiations with any
person that could result in (i) the sale, merger, consolidation or
recapitalization of ED, (ii) the sale of any of the assets of ED except in the
ordinary course of business, (iii) the sale of any outstanding ED Stock, (iv)
the acquisition by ED of any operating business or the capital stock of any
other person or entity, (v) the borrowing of money by ED, whether secured or
unsecured, or (vi) any agreement with any of the respective officers, managers
or affiliates of ED.

    
      
         

      

      
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    Section
3.16    Contracts and
Leases.  Except as set forth in Exhibit
3.16,
ED (i) does not have any leases of personal property relating to the assets of
ED, whether as lessor or lessee; (ii) does not have any contractual or other
obligations relating to the assets of ED, whether written or oral; and (iii) has
not given any power of attorney to any person or organization for any purpose
relating to the assets of ED.  ED has provided Buyer access to each
and every contract, lease or other document relating to the assets of ED to
which they are subject or are a party or a beneficiary.  To the
knowledge of the Seller, such contracts, leases or other documents are valid and
in full force and effect according to their terms and constitute a legal, valid
and binding obligation of ED and the other respective parties thereto and are
enforceable in accordance with their terms.  The Seller does not have
knowledge of any default or breach under such contracts, leases or other
documents or of any pending or threatened claims under any such contracts,
leases or other documents.

    

    Section
3.17    [INTENTIONALLY LEFT
BLANK]

    

    Section
3.18    Books and
Records.  The books of account, minute books, stock record
books or other records of ED that exist are accurate and complete and have been
maintained in accordance with sound business practices and will be located at
the offices of ED upon Closing.

    

    Section
3.19    Insurance Policies.  Copies
of all insurance policies maintained by ED relating to the operation of its
businesses have been delivered or made available to Buyer.  The
policies of insurance held by ED are in such amounts, and insure against such
losses and risks, as ED reasonably deems appropriate for its property and
business operations.  All such insurance policies are in full force
and effect, and all premiums due thereon have been paid.  Valid
policies for such insurance will be outstanding and duly in force at all times
prior to the Closing.

    

    Section
3.20    Pending
Claims.   There are no claims, suits, arbitrations,
investigations, actions or other proceedings, whether judicial, administrative
or otherwise, now pending or, to the best knowledge of  ED or the
Seller, threatened before any court, arbitration, administrative or regulatory
body or any governmental agency which may result in any judgment, order, award,
decree, liability or other determination which will or could reasonably be
expected to have any effect upon ED, or the transfer of the ED Stock by the
Seller to Buyer under this Agreement, nor is there any basis known to ED or the
Seller for any such action. No litigation is pending, or, to the knowledge of ED
or the Seller, threatened against ED, or the assets or properties of ED which
seeks to restrain or enjoin the execution and delivery of this Agreement or any
of the documents referred to herein or the consummation of any of the
transactions contemplated thereby or hereby.  Neither ED nor the
Seller is subject to any judicial injunction or mandate or any quasi-judicial or
administrative order or restriction directed to or against them which would
affect ED or the ED Stock to be transferred under this Agreement.

    

    Section
3.21    No
Liabilities.  As of the Closing Date, ED shall not have any
obligations or liability (contingent or otherwise) to any third
party.

    

    Section
3.22    Brokerage
Commission.  No broker or finder has acted for the ED or the
Seller in connection with this Agreement or the transactions contemplated
hereby, and no person is entitled to any brokerage or finder’s fee or
compensation in respect thereof based in any way on agreements, arrangements or
understandings made by or on behalf of ED or the Seller.

    
      
         

      

      
        Purchase
Agreement - Page 9

        
          

        

      

      
         

      

    

    Section
3.23    Banks and Brokerage
Accounts.  Exhibit
3.23 sets forth (a) a true and complete list of the names and locations
of all banks, trust companies, securities brokers and other financial
institutions at which ED has an account or safe deposit box or maintains a
banking, custodial, trading or other similar relationship, and (b) a true and
complete list and description of each such account, box and relationship,
indicating in each case the account number and the names of the respective
officers, employees, agents or other similar representatives of ED having
signatory power with respect thereto.

    

    Section
3.24    Disclosure.  No
representation or warranty of ED or the Seller contained in this Agreement
(including the exhibits hereto) contains any untrue statement or omits to state
a material fact necessary in order to make the statements contained herein or
therein, in light of the circumstances under which they were made, not
misleading.

    

    

    ARTICLE
IV

    REPRESENTATIONS
AND WARRANTIES

    OF
BUYER AND RICK’S

    

    Buyer and
Rick’s hereby represent and warrant to ED and the Seller as
follows:

    

    Section
4.1    Organization, Good Standing
and Qualification.  Buyer and Rick’s (i) are duly organized,
validly existing and in good standing under the laws of the state of Texas, (ii)
have all requisite power and authority to carry on their respective business,
and (iii) are duly qualified to transact business and are in good standing in
all jurisdictions where their ownership, lease or operation of property or the
conduct of their business requires such qualification, except where the failure
to do so would not have a material adverse effect to Buyer or
Rick’s.

    

    Section
4.2    Authorization.  Buyer
and Rick’s are corporations duly organized in the state of Texas and have full
power, capacity, and authority to enter into this Agreement and perform the
obligations contemplated hereby.  All action on the part of Buyer and
Rick’s necessary for the authorization, execution, delivery and performance of
this Agreement by them have been or will be taken before
Closing.  This Agreement, when duly executed and delivered in
accordance with its terms, will constitute legal, valid, and binding obligations
of Buyer and Rick’s enforceable against them in accordance with its terms,
except as may be limited by bankruptcy, insolvency, and other similar laws
affecting creditors' rights generally or by general equitable
principles.

    

    Section
4.3    Consents.  No
permit, consent, approval or authorization of, or designation, declaration or
filing with, any governmental authority or any other person or entity is
required on the part of Buyer or Rick’s in connection with the execution and
delivery by Buyer and Rick’s of this Agreement or the consummation and
performance of the transactions contemplated hereby other than as may be
required under the federal securities laws.

    

    Section
4.4    Disclosure.  No
representation or warranty of Buyer and Rick’s contained in this Agreement
(including the exhibits hereto) contains any untrue statement or omits to state
a material fact necessary in order to make the statements contained herein or
therein, in light of the circumstances under which they were made, not
misleading.

    
      
         

      

      
        Purchase
Agreement - Page 10

        
          

        

      

      
         

      

    

    Section
4.5    Brokerage
Commission.  No broker or finder has acted for the Buyer or
Rick’s in connection with this Agreement or the transactions contemplated
hereby, and no person is entitled to any brokerage or finder’s fee or
compensation in respect thereof based in any way on agreements, arrangements or
understandings made by or on behalf of Buyer or Rick’s.

    

    

    ARTICLE
V

    CONDITIONS
TO CLOSING

    

    The
obligations of the parties to effect the transactions contemplated hereby are
subject to the satisfaction at or prior to the Closing of the following
conditions:

    

    Section
5.1    Conditions to Obligations of
Buyer and Rick’s.

    

    
      	
               
      

            	
              (a)

            	
              Representations and
      Warranties of ED and the Seller.  The representations and
      warranties of ED and the Seller shall be true and correct on the Closing
      Date;

            

    

    

    
      	
               
      

            	
              (b)

            	
              Covenants.  All
      covenants, agreements and conditions contained in this Agreement to be
      performed by ED and the Seller on or prior to the Closing Date shall have
      been performed or complied with in all
respects;

            

    

    

    
      	
               
      

            	
              (c)

            	
              Delivery of
      Certificates.  The Sellers and ED shall provide to Buyer
      certificates, dated as of the Closing Date and signed the Seller and by
      representatives of ED, respectively, to effect set forth in Section 5.1(a)
      and 5.1(b) for the purpose of verifying the accuracy of such
      representations and warranties and the performance and satisfaction of
      such covenants and conditions;

            

    

    

    
      	
               
      

            	
              (d)

            	
              Resolutions.  ED
      shall have delivered resolutions of ED which authorize the execution,
      delivery and performance of this Agreement and the documents referred to
      herein to which it is or is to be a party dated as of the Closing
      Date;

            

    

    

    
      	
               
      

            	
              (e)

            	
              Delivery of ED
      Stock.  The Seller shall deliver or cause to be delivered
      to Buyer (i) originally issued certificates representing the shares of ED
      Stock duly endorsed over to the Buyer in a form satisfactory to the
      Buyer;

            

    

    

    
      	
               
      

            	
              (f)

            	
              Related
      Transactions.  The Related Transactions set forth in
      Section 2.3 shall be consummated concurrently with the
      Closing;

            

    

    

    
      	
               
      

            	
              (g)

            	
              Financial
      Records.  The financial records of ED shall be maintained
      and exist in such a manner as to allow for a certified audit as determined
      by Rick’s;

            

    

    

    
      	
               
      

            	
              (h)

            	
              Liabilities.  ED
      shall not have any liabilities as of the date of
  Closing;

            

    

    

    
      	
               
      

            	
              (i)

            	
              Third-Party
      Consents.  Any and all consents or waivers required from
      third parties relating to this Agreement or any of the other transactions
      contemplated hereby shall have been
obtained;

            

    

    
      
         

      

      
        Purchase
Agreement - Page 11

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (j)

            	
              Satisfactory
      Diligence.  Buyer shall have concluded its due diligence
      investigation of ED and its assets and properties and all other matters
      related to the foregoing, and shall be satisfied, in its absolute and sole
      discretion, with the results
thereof;

            

    

    

    
      	
               
      

            	
              (k)

            	
              No Actions or
      Proceedings.  No claim, action, suit, investigation or
      proceeding shall be pending or threatened before any court or governmental
      agency which presents a substantial risk of the restraint or prohibition
      of the transactions contemplated by this
  Agreement;

            

    

    

    
      	
               
      

            	
              (l)

            	
              Government
      Approvals.  All authorizations, permits, consents,
      orders, licenses or approvals of, or declarations or filings with, or
      expiration of waiting periods imposed by, any governmental entity
      necessary for the consummation of the transactions contemplated by this
      Agreement shall have been filed, occurred or been obtained;
      and

            

    

    

    
      	
               
      

            	
              (m)

            	
              Appointment of
      Director and Officer; Resignations.  At Closing, (i) Eric
      Langan shall have been appointed as the sole director of ED; and (ii) the
      Seller shall resign as a director of
ED.

            

    

    

    Section
5.2    Conditions to Obligations of
ED and the Seller

    

    
      	
               
      

            	
              (a)

            	
              Representations,
      Warranties and Agreements of Buyer and Rick’s.  The
      representations and warranties of Buyer and Rick’s shall be true and
      correct on the Closing Date;

            

    

    

    
      	
               
      

            	
              (b)

            	
              Covenants.  All
      covenants, agreements and conditions contained in this Agreement to be
      performed by the Buyer and Rick’s on or prior to the Closing Date shall
      have performed or complied with in all
respects;

            

    

    

    
      	
               
      

            	
              (c)

            	
              Delivery of
      Certificates.  Buyer and  Rick’s shall provide
      to ED and the Seller certificates dated as of the Closing Date and signed
      by a representative of the Buyer and Rick’s to the effect set forth in
      Section 5.2(a) and 5.2(b) for the purpose of verifying the accuracy of
      such representations and warranties and the performance and satisfaction
      of such covenants and conditions;

            

    

    

    
      	
               
      

            	
              (d)

            	
              Resolutions.  Buyer
      and Rick’s shall deliver resolutions, which authorize the execution,
      delivery and performance of this Agreement and the documents referred to
      herein to which it is or is to be a party dated as of the Closing
      Date;

            

    

    

    
      	
               
      

            	
              (e)

            	
              Payment of Purchase
      Price.  Buyer shall have (i) tendered the cash portion of
      the Purchase Price set forth in Section 1.3 and (ii) delivered the 8,696
      shares of common stock of Rick’s representing the stock portion of the
      Purchase Price to the Seller as set forth in Section 1.3 or shall deliver
      a letter of instruction to the transfer agent instructing the issuance of
      the shares to the Seller;

            

    

    

    
      	
               
      

            	
              (f)

            	
              Related
      Transactions.  The Related Transactions set forth in
      Section 2.3 shall be consummated concurrently with the
      Closing;

            

    

    
      
         

      

      
        Purchase
Agreement - Page 12

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (g)

            	
              Third Party
      Consents.  Any and all consents or waivers required from
      third parties relating to this Agreement or any of the other transactions
      contemplated hereby shall have been
obtained;

            

    

    

    
      	
               
      

            	
              (h)

            	
              No Actions or
      Proceedings.  No claim, action, suit, investigation or
      proceeding shall be pending or threatened before any court or governmental
      agency which presents a substantial risk of the restraint or prohibition
      of the transactions contemplated by this Agreement;
  and

            

    

    

    
      	
               
      

            	
              (i)

            	
              Government
      Approvals.  All authorizations, permits, consents, orders
      or approvals of, or declarations or filings with, or expiration of waiting
      periods imposed by, any governmental entity necessary for the consummation
      of the transactions contemplated by this Agreement shall have been filed,
      occurred or been obtained.

            

    

    

    

    ARTICLE
VI

    INDEMNIFICATION

    

    Section
6.1    Indemnification from the
Seller.  The Seller hereby agrees to and shall indemnify,
defend (with legal counsel reasonably acceptable to Buyer), and hold Buyer,
Rick’s, their officers, directors, shareholders, employees, affiliates, parent,
agents, legal counsel, successors and assigns  (collectively, the
“Buyer’s Group”) harmless at all times after the date of this Agreement, from
and against any and all actions, suits, claims, demands, debts, liabilities,
obligations, losses, damages, costs, expenses, penalties or
injury  (including reasonable attorneys fees and costs of any suit
related thereto) (collectively, “Indemnifiable Loss” or “Indemnifiable Losses”)
suffered or incurred by any or all of  the Buyer’s Group arising from:
(a) any material misrepresentation by, or material breach of any covenant or
warranty of  the Seller or ED contained in this Agreement, or any
exhibit, certificate, or other instrument furnished or to be furnished by the
Seller or ED hereunder; (b) any nonfulfillment of any material agreement on the
part of  the Seller or ED under this Agreement; (c) from any liability
or obligation due to any third party by ED and/or the Seller incurred prior to
the Closing Date, including all damages resulting to the Buyer’s Group from a
breach by the Seller or ED of any contracts occurring prior to the Closing Date;
or (d) any liabilities of ED incurred prior to the Closing Date.

    

    Section
6.2    Indemnification from
Buyer.  Buyer agrees to and shall indemnify, defend (with legal
counsel reasonably acceptable to Seller) and hold the Seller and
his  agents, legal counsel, successors and assigns, (collectively, the
"Seller’s Group") harmless at all times after the date of the Agreement from and
against any and all actions, suits, claims, demands, debts, liabilities,
obligations, losses, damages, costs, expenses, penalties or injury (including
reasonably attorneys fees and costs of any suit related thereto) suffered or
incurred by any or all of Seller’s Group, arising from (a) any material
misrepresentation by, or material breach of any covenant or warranty of Buyer or
Rick’s contained in this Agreement or any exhibit, certificate, or other
agreement or instrument furnished or to be furnished by Buyer hereunder; (b) any
nonfulfillment of any material agreement on the part of Buyer or Rick’s under
this Agreement; or (c) any liabilities of ED incurred subsequent to the Closing
Date.

    
      
         

      

      
        Purchase
Agreement - Page 13

        
          

        

      

      
         

      

    

    Section
6.3    Defense of
Claims.  If any lawsuit or enforcement action is filed against
any party entitled to the benefit of indemnity hereunder, written notice thereof
shall be given to the indemnifying party as promptly as practicable (and in any
event not less than fifteen (15) days prior to any hearing date or other date by
which action must be taken); provided that the failure of any indemnified party
to give timely notice shall not affect rights to indemnification hereunder
except to the extent that the indemnifying party demonstrates actual damage
caused by such failure.  After such notice, the indemnifying party
shall be entitled, if it so elects, to take control of the defense and
investigation of such lawsuit or action and to employ and engage attorneys of
its own choice to handle and defend the same, at the indemnifying party's cost,
risk and expense; and such indemnified party shall cooperate in all reasonable
respects, at its cost, risk and expense, with the indemnifying party and such
attorneys in the investigation, trial and defense of such lawsuit or action and
any appeal arising therefrom; provided, however, that the indemnified party may,
at its own cost, participate in such investigation, trial and defense of such
lawsuit or action and any appeal arising therefrom.  The indemnifying
party shall not, without the prior written consent of the indemnified party,
effect any settlement of any proceeding in respect of which any indemnified
party is a party and indemnity has been sought hereunder unless such settlement
of a claim, investigation, suit, or other proceeding only involves a remedy for
the payment of money by the indemnifying party and includes an unconditional
release of such indemnified party from all liability on claims that are the
subject matter of such proceeding.

    

    Section
6.4    Default of Indemnification
Obligation.  If an entity or individual having an
indemnification, defense and hold harmless obligation, as above provided, shall
fail to assume such obligation, then the party or entities or both, as the case
may be, to whom such indemnification, defense and hold harmless obligation is
due shall have the right, but not the obligation, to assume and maintain such
defense (including reasonable counsel fees and costs of any suit related
thereto) and to make any settlement or pay any judgment or verdict as the
individual or entities deem necessary or appropriate in such individual’s or
entities’ absolute sole discretion and to charge the cost of any such
settlement, payment, expense and costs, including reasonable attorneys fees, to
the entity or individual that had the obligation to provide such
indemnification, defense and hold harmless obligation and same shall constitute
an additional obligation of the entity or of the individual or both, as the case
may be.

    

    Section
6.5    Right to
Offset.  In the event that the Buyer or Rick’s is entitled to
indemnification in accordance with Section 6.1 and 6.3 hereof, including the
payment by the Buyer of any debts or liabilities resulting from the purchase of
the Company which were incurred prior to the Closing Date, then Buyer or Rick’s
shall have the right to offset any such amount from any obligations that are
then due and payable to the Seller.

    

    Section
6.6    Survival of Representations
and Warranties.  The respective representations, warranties and
indemnities given by the parties to each other pursuant to this Agreement shall
survive the Closing for a period ending twenty-four (24) months from the Closing
Date (“Survival Date”).  Notwithstanding anything to the contrary
contained herein, no claim for indemnification may be made against the party
required to indemnify (the “Indemnitor”) under this Agreement unless the party
entitled to indemnification (the “Indemnitee”) shall have given the Indemnitor
written notice of such claim as provided herein on or before the Survival
Date.  Any claim for which notice has been given prior the expiration
of the Survival Date shall not be barred hereunder.

    
      
         

      

      
        Purchase
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    ARTICLE
VII

    MISCELLANEOUS

    

    Section
7.1    Amendment;
Waiver.  Neither this Agreement nor any provision hereof may be
amended, modified or supplemented unless in writing, executed by all the parties
hereto.  Except as otherwise expressly provided herein, no waiver with
respect to this Agreement shall be enforceable unless in writing and signed by
the party against whom enforcement is sought.  Except as otherwise
expressly provided herein, no failure to exercise, delay in exercising, or
single or partial exercise of any right, power or remedy by any party, and no
course of dealing between or among any of the parties, shall constitute a waiver
of, or shall preclude any other or further exercise of, any right, power or
remedy.

    

    Section
7.2    Notices.  Any
notices or other communications required or permitted hereunder shall be
sufficiently given if in writing and delivered in person, transmitted by
facsimile transmission (fax) or sent by registered or certified mail (return
receipt requested) or recognized overnight delivery service, postage pre-paid,
addressed as follows, or to such other address has such party may notify to the
other parties in writing:

    

    
      	
              (a)

            	
              if
      to the Seller:

            	
              Don
      Waitt

            
	
               
      

            	
               
      

            	________________________________
	 
      	 
      	________________________________
	 
      	 
      	 
      
	 
      	
              with
      a copy to:

            	________________________________
	 
      	 
      	________________________________
	 
      	 
      	________________________________
	 
      	 
      	 
      
	
              (b)

            	
              if
      to Rick’s, Buyer

            	 
      
	 
      	
              or
      ED:

            	
              Rick’s
      Cabaret International, Inc.

            
	 
      	 
      	
              Attn:  Eric
      Langan, President

            
	 
      	 
      	
              10959
      Cutten Road

            
	 
      	 
      	
              Houston,
      Texas  77066

            
	 
      	 
      	
              Fax:  (281)
      397-6765

            
	 
      	 
      	 
      
	 
      	
              With
      a copy to:

            	
              Robert
      D. Axelrod

            
	 
      	 
      	
              Axelrod,
      Smith & Kirshbaum

            
	 
      	 
      	
              5300
      Memorial Drive, Suite 700

            
	 
      	 
      	
              Houston,
      Texas 77007

            
	 
      	 
      	
              Fax:  (713)
      552-0202

            

    

    

    A notice
or communication will be effective (i) if delivered in person or by overnight
courier, on the business day it is delivered, (ii) if transmitted by telecopier,
on the business day of actual confirmed receipt by the addressee thereof, and
(iii) if sent by registered or certified mail, three (3) business days after
dispatch.

    
      
         

      

      
        Purchase
Agreement - Page 15

        
          

        

      

      
         

      

    

    Section
7.3    Severability.  Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be prohibited by or invalid under applicable law, such
provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement.

    

    Section
7.4    Assignment; Successors and
Assigns.  Except as otherwise provided herein, the provisions
hereof shall inure to the benefit of, and be binding upon, the successors and
permitted assigns of the parties hereto.  No party hereto may assign
its rights or delegate its obligations under this Agreement without the prior
written consent of the other parties hereto, which consent will not be
unreasonably withheld.

    

    Section
7.5    Entire
Agreement.  This Agreement and the other documents delivered
pursuant hereto constitute the full and entire understanding and agreement
between the parties with regard to the subject matter hereof and thereof and
supersede and cancel all prior representations, alleged warranties, statements,
negotiations, undertakings, letters, acceptances, understandings, contracts and
communications, whether verbal or written among the parties hereto and thereto
or their respective agents with respect to or in connection with the subject
matter hereof.

    

    Section
7.6    Jurisdiction.  This
Agreement shall be governed by, and construed in accordance with, the laws of
the State of Texas, without regard to principles of conflict of
laws.  The parties agree that venue for purposes of construing or
enforcing this Agreement shall be proper in Harris County, Texas.

    

    Section
7.7    Execution.  This
Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the
other party, it being understood that both parties need not sign the same
counterpart.  In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a “.pdf” format data file, such
signature shall create a valid and binding obligation of the party executing (or
on whose behalf such signature is executed) with the same force and effect as if
such facsimile or “.pdf” signature page were an original thereof.

    

    Section
7.8    Costs and
Expenses.   Each party shall pay their own respective
fees, costs and disbursements incurred in connection with this
Agreement.

    

    Section
7.9    Section
Headings.  The section and subsection headings in this
Agreement are used solely for convenience of reference, do not constitute a part
of this Agreement, and shall not affect its interpretation.

    

    Section
7.10      No Third-Party
Beneficiaries.  Nothing in this Agreement will confer any third
party beneficiary or other rights upon any person or any entity that is not a
party to this Agreement.

     

    
      
        
           

        

        
          Purchase
Agreement - Page 16

          
            

          

        

        
           

        

      

    

     

    
      Section
7.11      Attorneys’
Review.  In connection with the negotiation and drafting of
this Agreement, the parties represent and warrant to each other they have had
the opportunity to be advised by attorneys of their own
choice.

    

     

    Section 7.12    Further
Assurances.  Each party covenants that at any time, and from
time to time, after the Closing Date, it will execute such additional
instruments and take such actions as may be reasonably be requested by the other
parties to confirm or perfect or otherwise to carry out the intent and purposes
of this Agreement.

    

    Section
7.13    Public
Announcements.   The parties hereto agree that prior to
making any public announcement or statement with respect to the transactions
contemplated by this Agreement, the party desiring to make such public
announcement or statement shall consult with the other parties hereto and
exercise their best efforts to (i) agree upon the text of a joint public
announcement or statement to be made by all of such parties or (ii) obtain
approval of the other parties hereto to the text of a public announcement or
statement to be made solely by the party desiring to make such public
announcement; provided, however, that if any party hereto is required by law to
make such public announcement or statement, then such announcement or statement
may be made without the approval of the other parties.

    

    Section
7.14    Validity.  The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provisions of this Agreement,
which shall remain in full force and effect.

    

    Section 7.15    Exhibits Not
Attached.  Any exhibits not attached hereto on the date of
execution of this Agreement shall be deemed to be and shall become a part of
this Agreement as if executed on the date hereof upon each of the parties
initialing and dating each such exhibit, upon their respective acceptance of its
terms, conditions and/or form.

    

    {SIGNATURES
ON FOLLOWING PAGE}

    

    
      
        
        

      

      
        Purchase
Agreement - Page 17

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, the undersigned have executed this Purchase Agreement to become
effective as of the date first set forth above.

    

    

    
      	 
      	
              RCI
      ENTERTAINMENT

            
	 
      	
               (MEDIA
      HOLDINGS), INC.

            
	 
      	 
      	 
      
	 
      	
              /s/ Eric Langan

            
	 
      	
              By:

            	
              Eric
      Langan, President

            
	 
      	
              Date:   
      

            	
              April
      15, 2008

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              RICK’S
      CABARET INTERNATIONAL, INC.

            
	 
      	 
      	 
      
	 
      	
              /s/ Eric Langan

            
	 
      	
              By:

            	
              Eric
      Langan, President

            
	 
      	
              Date:

            	
              April
      15, 2008

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              ED
      PUBLICATIONS, INC.

            
	 
      	 
      	 
      
	 
      	
              /s/
      Don Waitt

            
	 
      	
              By:

            	
              Don
      Waitt

            
	 
      	
              Its:

            	
              President

            
	 
      	
              Date:

            	
              April
      15, 2008

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              SELLER

            
	 
      	 
      	 
      
	 
      	
              /s/ Don Waitt

            
	 
      	
              Don
      Waitt, Individually

            
	 
      	
              Date:

            	
              April
      15, 2008

            

    

    

    
Purchase Agreement - Page
18ex10_2.htm

    
      

    

    Exhibit
10.2

     

    LOCK-UP/LEAK-OUT
AGREEMENT

    

    

    THIS LOCK-UP/LEAK-OUT AGREEMENT (the
“Agreement”) is made and entered into as of the 15th day of April, 2008, between
RICK’S CABARET INTERNATIONAL,
INC., a Texas corporation (“Rick’s”), and DON WAITT (“Holder” or
“Waitt”).

    

    WHEREAS, the parties entered
into a Purchase Agreement dated April 15, 2008 (the “Purchase
Agreement”), by and among Waitt, ED Publications, Inc., a Texas corporation (the
“Company”), Rick’s and its wholly owned subsidiary, RCI Entertainment (Media
Holdings), Inc., a Texas corporation (the “Buyer”); and

    

    WHEREAS, pursuant to the terms
and condition of the Purchase Agreement, Waitt has agreed to sell to Buyer his
ownership interest in the Company (the “Acquisition”); and

    

    WHEREAS, under the terms of
the Purchase Agreement, Waitt shall be entitled to receive 8,696 shares of
common stock of Rick’s upon the Closing of the Purchase Agreement and has the
right to earn out an additional 65,217 shares of common stock of Rick’s (the
“Earn Out Shares”), which is conditioned upon, among other things, the execution
and delivery of this Agreement; and

    

    WHEREAS, the shares of common
stock issued to Waitt at Closing and the Earn Out Shares, if any, issued to
Waitt are hereinafter collectively referred to as the “Rick’s Transaction
Shares”; and

    

    WHEREAS, Waitt has agreed to
enter into this Agreement and to restrict the sale, assignment, transfer,
conveyance, or hypothecation of the Rick’s Transaction Shares, all on the terms
set forth below; and

    

    WHEREAS, any capitalized terms
not defined herein shall have the meaning set forth in the Purchase
Agreement.

    

    NOW, THEREFORE, in
consideration of the foregoing premises and the mutual covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as
follows:

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    
      	
              1.

            	
              The
      Holder agrees he may not sell, pledge, hypothecate, transfer, assign or in
      any other manner dispose of the Rick’s Transaction Shares for one
      year from the date hereof.

            

    

    

    
      	
              2.

            	
              (a)

            	
              On
      or after one (1) year from the date of Closing, or with respect to
      the  Earn Out Shares, if any, on or after seven (7) months from
      the date of issuance by Rick’s of the Earn Out Shares, Waitt shall have
      the right, but not the obligation, to have Rick’s purchase from Waitt
      5,000 Rick’s Transaction Shares per month (the “Monthly Shares”)
      calculated at a price per share equal to $23.00 per share (“Value of the
      Shares”) until Waitt has received an aggregate of $1,700,000 (i) from the
      sale of the Rick’s Transaction Shares sold by Waitt, regardless of whether
      sold to Rick’s, sold in the open market or in a private transaction or
      otherwise and (ii) the payment of any Deficiency (as hereinafter defined)
      by Rick’s.  Waitt shall notify Rick’s during any given month
      of  Waitt’s election to “Put” the Monthly Shares
      to  Rick’s during that particular month and Rick’s shall have
      three (3) business days to elect to buy the Monthly Shares or instruct
      Waitt to sell the Monthly Shares in the open market.  At Rick’s
      election, during any given month, it may either buy the Monthly Shares or
      if Rick’s elects not to buy the Monthly Shares from Waitt, then Waitt may
      sell the Monthly Shares in the open market and any deficiency between the
      amount which Waitt receives from the sale of the Monthly Shares and the
      Value of the Shares (the “Deficiency”) shall be paid by Rick’s within
      three (3) business days after receipt of written notice from Waitt of the
      sale of the Monthly Shares which shall provide the written sales
      confirmation and the amount of the Deficiency.  Rick’s
      obligation to purchase any of the Rick’s Transaction Shares from Waitt
      shall terminate and cease at such time as Waitt has received an aggregate
      of $1,700,000 (assuming all Earn Out Shares have been issued) from (i) the
      sale of the Rick’s Transaction Shares, regardless of whether sold to
      Rick’s, sold in the open market or in a private transaction or otherwise,
      and (ii) the payment of any Deficiency by Rick’s.  Waitt agrees
      to provide monthly statements to Rick’s as to the total number of Rick’s
      Transaction Shares which Waitt sold and the amount of proceeds derived
      therefrom.  Nothing contained herein shall limit or preclude
      Waitt from selling his Rick’s Transaction Shares in the open market or
      require Waitt to “Put” his Rick’s Transaction Shares to Rick’s during any
      given month.  In the event that the Holder elects to sell the
      Rick’s Transaction Shares pursuant to this Section 2(a), then any amount
      sold at prices less than the Value of the Shares shall be deemed to be
      sold at $23.00 for purposes of this Section
  2(a).

            

    

    

    
      	
               
      

            	
              (b)

            	
              In
      the event the Holder elects not to “Put” the Rick’s Transaction Shares to
      Rick’s, the Holder shall sell (i) not more than 10,000 Rick’s Transaction
      Shares per 30-day period, and (ii) not more than 70,000 Rick’s Transaction
      Shares per 90-day period regardless of whether the Holder “Puts” the
      Rick’s Transaction Shares to Rick’s or sells them in the open market, in a
      private transaction or otherwise.

            

    

    

    
      	
              3.

            	
              The
      Holder acknowledges and agrees that Rick’s may advise its Transfer Agent
      of this Agreement and issue a stop transfer order to the Transfer Agent to
      ensure that any sale of the Rick’s Transaction Shares by the Holder is in
      accordance with the terms and conditions
hereof.

            

    

    

    
      Lock-Up/Leak-Out
Agreement – Page 2

    

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    
      	
              4.

            	
              The
      Holder agrees that it will not engage in any short selling of any shares
      of common stock of Rick’s during the term of this
      Agreement.

            

    

    

    
      	
              5.

            	
              Except
      as otherwise provided in this Agreement or any other agreements between
      the parties, the Holder shall be entitled to his respective beneficial
      rights of ownership of the issued Rick’s Transaction Shares, including the
      right to vote any issued Rick’s Transaction Shares for any and all
      purposes.

            

    

    

    
      	
              6.

            	
              The
      resale restrictions on the Rick’s Transaction Shares set forth in this
      Agreement shall be in addition to all other restrictions on transfer
      imposed by applicable United States and state securities laws, rules and
      regulations.

            

    

    

    
      	
              7.

            	
              If
      either Rick’s or the Holder fails to fully adhere to the terms and
      conditions of this Agreement, it shall be liable to the other party for
      any damages suffered by the other party by reason of any such breach of
      the terms and conditions hereof.  Rick’s and the Holder agree
      that in the event of a breach of any of the terms and conditions of this
      Agreement by Rick’s or the Holder, that in addition to all other remedies
      that may be available in law or in equity to Rick’s or the Holder, as the
      case may be, a preliminary and permanent injunction and an order of a
      court requiring Rick’s or the Holder to cease and desist from violating
      the terms and conditions of this Agreement and specifically requiring
      Rick’s or the Holder to perform their obligations hereunder is fair and
      reasonable by reason of the inability of the parties to this Agreement to
      presently determine the type, extent or amount of damages that Rick’s or
      the Holder may suffer as a result of any breach or continuation thereof.
      In the event of default hereunder, the non-defaulting party shall be
      entitled to recover reasonable attorney's fees incurred in the enforcement
      of this Agreement.

            

    

    

    
      	
              8.

            	
              This
      Agreement sets forth the entire understanding of the parties hereto with
      respect to the subject matter hereof, and may not be amended except by a
      written instrument executed by the parties
  hereto.

            

    

    

    
      	
              9.

            	
              This
      Agreement shall be governed by, and construed in accordance with, the laws
      of the State of Texas, without regard to principles of conflict of
      laws.

            

    

    

    
      	
              10.

            	
              This
      Agreement may be executed in two or more counterparts, all of which when
      taken together shall be considered one and the same agreement and shall
      become effective when counterparts have been signed by each party and
      delivered to the other party, it being understood that both parties need
      not sign the same counterpart.  In the event that any signature
      is delivered by facsimile transmission or by e-mail delivery of a “.pdf”
      format data file, such signature shall create a valid and binding
      obligation of the party executing (or on whose behalf such signature is
      executed) with the same force and effect as if such facsimile or “.pdf”
      signature page were an original
thereof.

            

    

    

    
      Lock-Up/Leak-Out
Agreement – Page 3

    

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    IN WITNESS WHEREOF, the
undersigned have duly executed and delivered this Lock-Up/Leak-Out Agreement as
of the day and year first above written.

    

    

    
      	
              Date:
      April 15, 2008

            	
              RICK’S
      CABARET INTERNATIONAL, INC.

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	
              By:

            	
              /s/ Eric Langan

            	 
      
	 
      	 
      	
              Eric Langan,
      President

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	
              HOLDER

            	 
      
	 
      	 
      	 
      	 
      
	 
      	
              /s/ Don Waitt

            	 
      
	 
      	
              DON WAITT

            	 
      
	 
      	 
      	 
      	 
      
	 
      	
              Number
      of Shares of Rick’s Common Stock Subject to this
Agreement:

            	 
      
	 
      	 
      	 
      	 
      
	 
      	
              8,696 shares of Rick’s Common
      Stock

            	 
      
	 
      	 
      	 
      	 
      
	 
      	
              65,217 Earn Out Shares, if
      issued

            	 
      

    

    

    
      Lock-Up/Leak-Out
Agreement – Page 4

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