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SAFE HARBOR

SAFE HARBOR.

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SAFE HARBOR

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  1. SAFE HARBOR Certain statements contained in this presentation regarding Rick's Cabaret future operating results or performance or business plans or prospects and any other statements not constituting historical fact are "forward-looking statements" subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995.  Where possible, the words "believe," "expect," "anticipate," "intent," "would," "will," "planned," "estimated," "potential," "goal," "outlook," and similar expressions, as they relate to the company or its management have been used to identify such forward-looking statements.  All forward-looking statements reflect only current beliefs and assumptions with respect to future business plans, prospects, decisions and results, and are based on information currently available to the Company.   Accordingly, the statements are subject to significant risks, uncertainties and contingencies, which could cause the Company‘s actual operating results, performance or business plans or prospects to differ materially from those expressed in, or implied by, these statements.  Such risks, uncertainties and contingencies include, but are not limited to, risks and uncertainties associated with (i) operating and managing an adult business, (ii) the business climates in cities where the company operates, (iii) the success or lack thereof in launching and building the company’s businesses, (iv) the operational and financial results of the company's adult nightclubs, (v) conditions relevant to real estate transactions, (vi) the loss of key personnel, and (vii) laws governing the operation of adult entertainment businesses.  Additional factors that could cause the Company’s results to differ materially from those described in the forward-looking statements are described in forms filed with the SEC from time to time and available at www.ricksinvestor.com or on the SEC's internet website at www.sec.gov. Unless required by law, Rick's Cabaret does not undertake any obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise..

  2. Definition of Adjusted EBITDA During this Conference Call you may hear us refer to Adjusted EBITDA. We consider Adjusted EBITDA to be a key metric to measure our performance. It is a financial statement measure that was not derived in accordance with GAAP. In calculating Adjusted EBITDA the company excludes the largest recurring non-cash charge, depreciation, amortization and impairment charges. Adjusted EBITDA provides a core operational performance measurement that compares results without the need to adjust for Federal, state and local taxes, which have considerable variation between domestic jurisdictions.  Also, the company excludes interest cost in the calculation of Adjusted EBITDA. The results are, therefore, without consideration of financing alternatives of capital employed. The company uses Adjusted EBITDA as one guideline to assess unleveraged performance return on investments. Adjusted EBITDA is also the target benchmark for acquisitions of nightclubs.

  3. CONFERENCE CALL OVERVIEWAugust 9, 2O11 Summary of Q3 Chief Drivers of Revenue Increase Impact of NBA Championships, New Clubs Details on Las Vegas Decision Outlook for Remainder of 2011 Discussion of Stock Valuation/Buyback Q & A

  4. SNAPSHOT: Q3 ’11 vs.‘1O Q3 ‘11 Revenue $20.8 million vs $18.0 million, a 15.4% Increase over ‘10 Higher Revenue Primarily Due to NBA Championship games in Miami & Dallas, plus Newly Acquired Clubs and Strong San Antonio + Minneapolis + North Austin Q3 Same Store Sales up 9% over last year, to $19.2 million Adjusted EBITDA in Q3 $6.0 million vs $3.9 million, a 52% Gain over ‘10

  5. …MORE Q3 SNAPSHOT Q3 ‘11 Net Income from Continuing Ops $2.5 million vs $1.1 million; EPS 25¢ vs 11¢ Q3 Net Income Attributable to RICK Common Stock, $888,000 vs. $857,000; EPS 9¢ both years. Net Cash from Operating Activities in 9 mo, $13.7 million

  6. LEAVING LAS VEGAS: WHY • We Advised Markets Last Year We Would Evaluate Las Vegas to Determine If Profitability was Achievable and Would Exit the Market if Not • We Continued to Try Every Possible Strategy to Build the Business in a Terrible Economic Environment • 6 Month Loss in Through March $800,000 (vs. $340,000 in Previous Year). • Decision to Close Came After Hard Look at Low Probability of Potential Future Returns…AND after Settling Cross-Litigation with Former Sellers That Yields $900,000, Plus Settlement That Relieves Us from Put Option Cost of $1.4 million to Buy Shares Back • Eliminating Loss and Tax Benefits Outweigh Potential Future Returns

  7. Current Update Club Onyx Philadelphia Now Benefitting from Extension of Operating Hours for Entertainment & Dining – Expect Return to Profitability Acquisition of Schiek’s Cabaret Royale in Minneapolis Is Complete – it’s now Downtown Cabaret Rick’s Cabaret Indianapolis Launched and Is Up & Running Omaha Acquisition of Sarie’s Lounge Is On Hold Due to River Flooding & Other Concerns TABC Hearing for Rick’s Cabaret/DFW was Held in June, Ruling Expected by Sept. 8th

  8. Current debt 6/30/11 = $36.9 million Reduced Debt by $3.3 million in Nine Months ended 6/30/11 $6.2 million To Be Paid Down Over Next Year Continue to Explore Refinancing of Some Or All Of Our Real Estate Debt DEBT UPDATE

  9. Forward Growth Strategy Continue Emphasis on Organic Growth & Cash Generation Continuing to Look at Accretive Acquisitions (Especially In Areas Where We Currently Operate) Watching Economy Closely But We Anticipate Continued Growth, Even In Tough Recessionary Times

  10. Outlook • We had a Great April -- Much Better than ’10, with Help from NBA plus Contributions of New Clubs, San Antonio and Minneapolis • If Current Trends Continue & Economy Cooperates, ‘11 May Be One Of Our Best Years Ever • Our Stock is Undervalued Now And We Will be Buying It Back at These Levels…It’s The Cheapest Acquisition • We Are Not Issuing Any Formal Guidance At This Time

  11. THANK YOU! Be Sure To Visit a Rick’s Cabaret Establishment Soon for Some Personal Due Diligence

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