RICK discloses material control weaknesses, halts Bombshells expansion as same-store sales drop 7.7%

Filed May 7, 2026 · Period ending December 31, 2025 · Compared to 10-Q Feb 10, 2025 · ~1 min read

Key Changes

• high

  Management concluded disclosure controls ineffective due to three material weaknesses: IT general controls (program change management, vendor management), business combination accounting including contingent liabilities, and impairment assessments across all asset classes.

  Controls & Procedures verify on EDGAR →
• high

  Same-store sales declined 7.7% year-over-year (nightclubs down 5.8%, Bombshells down 21.9%), reversing prior year's 2.3% growth. Company halting Bombshells expansion after one final location, citing weak performance trends.

  MD&A: Operations verify on EDGAR →
• high

  Company repurchased 821,000 shares for $30M ($36.54/share) via $8M cash and $22M two-year 12% note, generating $9.8M non-cash premium charge that drove Q1 net loss of $4.7M versus $9.8M profit prior year.

  MD&A: Capital Allocation verify on EDGAR →