What changed in this filing

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Item 9A. Controls and Procedures

2024-12-16 compared with 2023-12-14 · 102 added, 87 removed, 583 unchanged (24% of the section changed)

10 unchanged sentences

(1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and the dispositions of our assets;

(2) provide reasonable assurance that our 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 appropriate authorizations;

(2) provide reasonable assurance that our transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S.

GAAP and that our receipts and expenditures are being made only in accordance with appropriate authorizations;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our consolidated financial statements.

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A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

We have identified material weaknesses in internal control related to (1) proper design and implementation of controls over management’s review of the Company’s accounting for business combinations, specifically related to the identification of and accounting for, intangible assets acquired in a business combination, and over the precision of management's review of certain valuation assumptions;

(2) the impairment of goodwill, indefinite-lived intangibles, and long-lived assets, specifically over the precision of management's review of certain assumptions;

and (3) ineffective information technology general controls (ITGCs") in the areas of user access and program change-management over certain information technology ("IT") systems that support the Company's financial reporting processes.

We have identified material weaknesses in internal control related to (1) ineffective design and operation of controls over certain information technology general controls ("ITGCs"), including program change management, user access, and vendor management controls;

(2) ineffective design and operation of controls, which include management review controls, over the accounting for business combinations;

and (3) ineffective design and operation of controls, which include management review controls, over the Company's assessments of potential impairment.

Our business process controls (automated and manual) that are dependent on the affected ITGCs were also deemed ineffective because they could have been adversely impacted.

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Certain outsourced IT service providers could not provide System and Organization Controls ("SOC") reports for periods that closely align with our fiscal year end.

that management did not effectively assess the design and operation of these outsourced IT service providers’ internal controls, some of our controls over IT systems and business processes were also deemed ineffective, but only to the extent that we rely upon information that was subject to the outsourced IT service providers’ control environment.

Given that management did not effectively assess the design and operation of these outsourced IT service providers’ internal controls, some of our controls over IT systems and business processes were also deemed ineffective, but only to the extent

that we rely upon information that was subject to the outsourced IT service providers’ control environment.

These deficiencies may have an impact on our financial statements, account balances, and disclosures.

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Our CEO and CFO have certified that, based on their knowledge, the financial statements, and other financial information included in this Form 10-K, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this Form 10-K.

The Company’s independent registered public accounting firm, Marcum LLP, has expressed an unqualified opinion on our financial statements and an adverse opinion on our internal control over financial reporting as of September 30, 2023, in the audit report that appears at the end of Part II of this Annual Report on Form 10-K.

The Company’s independent registered public accounting firm, Marcum LLP, has expressed an unqualified opinion on our consolidated financial statements and an adverse opinion on our internal control over financial reporting as of September 30, 2024, in the audit report that appears at the end of Part II of this Annual Report on Form 10-K.

Remediation Plan for Existing Material Weaknesses

Management is committed to the remediation of the material weaknesses described above.

Review of Accounting for Business Combinations

Management is committed to the remediation of the material weakness described above.

As such, controls will be added to both increase precision of management’s review of each component of business combinations, and if necessary, retain the services of a third-party consultant to assist in the valuation and accounting for intangible assets acquired in a business combination.

Controls will be added to both increase precision of management’s review of each component of business combinations, and if necessary, retain the services of a third-party consultant to assist in the valuation and accounting for intangible assets acquired in a business combination.

Review of Accounting for Impairment of Goodwill and Intangible Assets

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(i) strengthening and enhancing the review and documentation procedures in our controls over user access review;

(ii) define and communicate clear and concise program change management policy and procedures;

(ii) defining and communicating clear and concise program change management policy and procedures;

(iii) enhancing the reporting requirements of accounting system audit logs;

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It is our belief that these added controls will effectively remediate the existing material weaknesses.

We believe that these actions will remediate the material weaknesses.

The material weaknesses will not be considered remediated, however, until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

1 unchanged sentence

Changes in Internal Control Over Financial Reporting

During fiscal year 2023, the Company completed several business combinations as described in Note 14 - Acquisitions and Dispositions to our audited Consolidated Financial Statements.

• On October 26, 2022, the Company completed the acquisition of a club in Dickinson, Texas.

• On March 16, 2023, the Company and certain of its subsidiaries completed the acquisition of five gentlemen's clubs, five related real estate properties, associated intellectual properties, and certain automated teller machines.

The scope of management’s assessment of the effectiveness of the Company’s disclosure controls and procedures for fiscal year end 2023 did not include the internal control over the financial reporting of these acquisitions, in accordance with the SEC’s staff guidance that permits exclusion of acquisitions from their final assessment of internal control over financial reporting for the fiscal year in which the acquisition occurred.

Due to the size, breadth and complexity of the acquisition of these businesses, management’s evaluation of internal control over financial reporting for the fiscal year ended September 30, 2023, did exclude those internal control activities.

The businesses are wholly owned subsidiaries whose total assets and total revenues are excluded from management’s assessment and represent approximately 7% and 6%, respectively, of the related consolidated financial statement amounts as of and for the year ended September 30, 2023.

Except for the remediation efforts as discussed above, there have been no other changes in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) of the Exchange Act) during the quarter ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

OTHER INFORMATION.

Insider Trading Agreements

None of our officers or directors, as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, adopted, modified, or terminated a "Rule 10b5-1 trading agreement" or a "non-Rule 10b5-1 trading agreement," as defined in Item 408 of Regulation S-K, during the three months ended September 30, 2024.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

7 unchanged sentences

The following material weaknesses have been identified and included in Management's Annual Report on Internal Control Over Financial Reporting:

• The Company had ineffective design, implementation and, operation of controls over program change management, user access and vendor management controls to ensure:

1) IT program and data changes affecting the Company’s financial IT applications and underlying accounting records, are identified, tested, authorized, and implemented appropriately to validate that data produced by its relevant IT system(s) were complete and accurate.

Automated process-level and manual controls that are dependent upon the information derived from such financially relevant systems were also determined to be ineffective as a result of such deficiency;

2) appropriate restrictions that would adequately prevent users from gaining inappropriate access to the financially relevant systems;

3) key third party service provider SOC reports were obtained and reviewed.

• Ineffective design, implementation, and operation of controls, which include management review controls, over the accounting for business combinations.

• Ineffective design, implementation, and operation of controls, which include management review controls, over the Company's assessments of potential impairment.

• The Company had ineffective design and operation of controls over certain information technology general controls ("ITGCs"), including program change management, user access, and vendor management controls to ensure:

1) For all in-scope systems, IT program and data changes affecting the Company’s financial IT applications and underlying accounting records are identified, tested, authorized, and implemented appropriately to validate that data produced by its relevant IT system(s) were complete and accurate;

2) For a certain three systems, appropriate restrictions that would adequately prevent users from gaining inappropriate access;

3) For three key service providers, SOC reports were obtained and reviewed.

As a result of the above deficiencies, automated process-level and manual controls, including the remaining ITGCs, that are dependent upon the information derived from such financially relevant systems were also determined to be ineffective.

• Ineffective design and operation of controls, which include management review controls, over the accounting for business combinations.

• Ineffective design and operation of controls, which include management review controls, over the Company's assessments of potential impairment.

These material weaknesses were considered in determining the nature, timing and extent of audit tests applied in our audit of the fiscal 2024 consolidated financial statements and financial statement schedule, and this report does not affect our report dated December 16, 2024 on those consolidated financial statements.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheet as of September 30, 2023 and the related consolidated statement of operations, changes in equity, and cash flows and the related financial statement schedule for the year ended September 30, 2023 of the Company and our report dated December 14, 2023 expressed an unqualified opinion on those consolidated financial statements and financial statement schedule.

Explanatory Paragraph – Excluded Subsidiaries

As described in “Management’s Annual Report on Internal Control Over Financial Reporting”, management has excluded the Company’s acquisition of two businesses that occurred during the year ended September 30, 2023, from its assessment of internal control over financial reporting as of September 30, 2023 because these entities were acquired by the Company in purchase business combinations during the year ended September 30, 2023.

We have also excluded these two businesses from our audit of internal control over financial reporting.

These businesses are wholly owned subsidiaries whose

combined total assets and total revenues represent approximately 7% and 6%, respectively, of the related consolidated financial statement amounts as of and for the year ended September 30, 2023.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets as of September 30, 2024 and 2023 and the related consolidated statements of income, changes in equity, and cash flows and the related financial statement schedule for each of the years in the two-year period ended September 30, 2024 of the Company and our report dated December 16, 2024 expressed an unqualified opinion on those consolidated financial statements and financial statement schedule.

Basis for Opinion

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He is a Certified Public Accountant (CPA), Certified Fraud Examiner (CFE), and Certified Information Systems Auditor (CISA).

He joined us in November 2015 as Controller in charge of migrating the company to an upgraded ERP system and enhancing internal and external audit and SEC

reporting functions.

He joined us in November 2015 as Controller in charge of migrating the company to an upgraded ERP system and enhancing internal and external audit and SEC reporting functions.

From 2007 through 2009, he was an auditor for Deloitte & Touche LLP.

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Yura Barabash became a director on September 19, 2017.

Since October 2021, he has served as the Vice President of Business Development at AVI-SPL, the world's largest AV/UCC integrator, and digital solutions provider based in Florida.

Since October 2021, he has served as the Vice President of Business Development at AVI-SPL, the world's largest designer, integrator and provider of advanced audio-visual (AV) and collaboration solutions and services based in Florida.

Barabash brings with him extensive corporate finance experience across various industries both domestically and internationally.

He has played a key role in numerous equity and debt financings, as well as mergers and acquisitions transactions involving public and private companies in the United States, Mexico, China, Brazil and the European Union.

He has played a key role in numerous equity and debt financings, as well as mergers and acquisitions in the United States, Latin America, China, and the European Union.

From August 2019 to January 2021, Mr.

Barabash was a Chief Operating Officer of Gingko Online Learning LLC, private online learning company in Florida and a consultant to Chengdu Gingko Education Management, educational management company in Chengdu, China.

Barabash was a Chief Operating Officer of Gingko Online Learning LLC, private online language learning company in Florida and a consultant to Chengdu Gingko Education Management, educational management company in Chengdu, China.

From 2016 to June 2019, he was a Senior Vice President of Finance at Motorsport Network LLC (www.motorsportnetwork.com) in Miami, the largest motorsport digital media company in the world.

Prior to joining Motorsport Network, he was an investment banker at Primary Capital from 2011 until 2016.

Previously, Mr.

Barabash was an investment banker at Rodman & Renshaw and Merrill Lynch.

Earlier in his career, Mr.

Barabash held investment banking roles at Primary Capital, Rodman & Renshaw, and Merrill Lynch.

He holds a B.A.

from Sevastopol City University in Ukraine and a Master in International Affairs from Columbia University in New York City, and is fluent in Russian.

Barabash has recently attended the Harvard Business School Executive Education programs focusing on Audit and Compensation Committees.

Barabash recently completed the Cybersecurity Governance course at MIT Sloan and the Audit and Compensation Committees programs at Harvard Business School Executive Education.

Martin became a director on August 8, 2019.

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Section 16(a) of the Securities Exchange Act of 1934 requires our directors and executive officers, and persons who own beneficially more than ten percent of our common stock, to file reports of ownership and changes of ownership with the Securities and Exchange Commission.

Based solely upon a review of Forms 3, 4 and 5 furnished to us during the fiscal year ended September 30, 2023, we believe that the directors, executive officers, and greater than ten percent beneficial owners have complied with all applicable filing requirements during the fiscal year ended September 30, 2023.

Based solely upon a review of Forms 3, 4 and 5 furnished to us during the fiscal year ended September 30, 2024, we believe that the directors, executive officers, and greater than ten percent beneficial owners have complied with all applicable filing requirements during the fiscal year ended September 30, 2024, except for a Form 4 for a single transaction that was not filed on a timely basis by Bradley Chhay, our Chief Financial Officer.

CODE OF ETHICS

We have adopted a code of ethics for our principal executive and senior financial officers, a copy of which can be found on our website at www.rcihospitality.com.

INSIDER TRADING POLICIES

We have adopted an insider trading policy governing the purchase, sale and other dispositions of our securities that applies to all of RCI Hospitality Holdings, Inc.’s directors, officers and employees, and also applies to other key employees of subsidiaries of RCI Hospitality Holdings, Inc., as determined by our Chief Compliance Officer.

We do not presently have written procedures for the repurchase of our securities.

We believe that our insider trading policy and procedures are reasonably designed to promote compliance with insider trading laws, rules and regulations, and listing standards applicable to us.

A copy of our insider trading policy is filed as Exhibit 19.1 to this Form 10-K.

EXECUTIVE COMPENSATION.

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We also take into account the compensation that is paid by companies that we believe to be our competitors and by other companies with which we believe we generally compete for executives.

In establishing compensation packages for executive officers, numerous factors are considered, including the particular executive’s experience, expertise and performance, our company’s overall performance and

compensation packages available in the marketplace for similar positions.

In arriving at amounts for each component of compensation, our Compensation Committee strives to strike an appropriate balance between base compensation and incentive compensation.

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2022 $3,419,853 $ 3,329,003 $ 2,066,195 $ 1,975,345 $ 319.02 $ 129.93 $ 46,060,000 $ 58,911,000

2021 $1,545,218 $ 1,545,218 $ 504,181 $ 504,181 $ 336.19 $ 88.89 $ 30,150,000 $ 36,084,000

(1) Non-PEO NEOs represent Bradley Chhay and Travis Reese for each of the fiscal years presented.

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2024 2023 2022 2021

PEO Average for Non-PEO NEOs PEO Average for Non-PEO NEOs PEO Average for Non-PEO NEOs

PEO Average for Non-PEO NEOs PEO Average for Non-PEO NEOs PEO Average for Non-PEO NEOs PEO Average for Non-PEO NEOs

Summary Compensation Table total $ 1,829,649 $ 589,119 $ 1,867,388 $ 535,500 $ 3,419,853 $ 2,066,195 $ 1,545,218 $ 504,181

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EMPLOYMENT AGREEMENTS

On August 25, 2022, we entered into new two-year employment agreements with each of our executive officers, including Eric Langan, our Chief Executive Officer and President;

Bradley Chhay, our Chief Financial Officer;

and Travis Reese, our Executive Vice President and Secretary.

On August 28, 2023, we entered into a new two-year employment agreement with Bradley Chhay, under which he receives an annual salary of $600,000.

The term of the agreement commenced on August 28, 2023, and will end on August 31, 2025.

On September 5, 2024, we entered into new two-year employment agreements with Eric Langan, our Chief Executive Officer and President, and Travis Reese, our Executive Vice President and Secretary, which agreements were effective as of September 1, 2024.

Under their respective new agreements, Mr.

Chhay’s annual salary increased to $465,000;

Reese’s annual salary increased to $575,000;

Langan’s annual salary remained the same at $1,700,000.

Langan’s annual salary is $1,700,000.

The term of each of the agreements commenced on September 1, 2024, and will end on August 31, 2026.

On August 28, 2023, we entered into a new two-year employment agreement with Bradley Chhay, which terminated his employment agreement mentioned above.

Under the agreement, Mr.

Chhay's annual salary increased to $600,000.

The term of the agreement commenced on August 28, 2023, and will end on August 31, 2025.

Each of the new employment agreements also provides for bonus eligibility, expense reimbursement, health benefits, participation in our benefit plans, use of a company-owned automobile, access to company-owned aircraft (subject to the terms and conditions of our corporate aircraft policy), and two weeks paid vacation annually.

Each of the employment agreements above provides for bonus eligibility, expense reimbursement, health benefits, participation in our benefit plans, use of a company-owned automobile, access to company-owned aircraft (subject to the terms and conditions of our corporate aircraft policy), and two weeks paid vacation annually.

Under the terms of the new agreements, each executive is bound to a confidentiality provision and cannot compete with us for a period upon termination of the agreement.

Further, in the event we terminate any such employee without cause or such employee terminates his employment because we reduce or fail to pay his compensation or materially change his responsibilities, such employee is entitled to receive in one lump sum payment the full remaining amount under the term of his employment agreement to which he would have been entitled had his agreement not been terminated.

Currently, our executive officers do not have long-term incentive plans or defined benefit or actuarial plans outstanding.

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On February 9, 2022, the board of directors approved a grant of 50,000 stock options each to six members of management subject to the approval of the 2022 Plan.

Timing of Grants of Certain Equity Awards

We do not have any formal policies regarding the timing of awards of options in relation to the disclosure of material nonpublic information.

Except for the options granted in February 2022, we had not awarded any stock-based compensation since fiscal 2014.

If we grant additional options in the future, it is anticipated that the board and Compensation Committee will take material nonpublic information into account when determining the timing and terms of such an award, with the goal being to not grant such awards close in time to the release of any material nonpublic information.

We have never timed the disclosure of material nonpublic information for the purpose of affecting the value of executive compensation.

COMPENSATION POLICIES AND PRACTICES AS THEY RELATE TO RISK MANAGEMENT

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934,592 10.50 %

The Vanguard Group - 23-1945930 (6)

492,823 5.54 %

Progeny 3, Inc.

460,968 5.18 %

(1) These percentages exclude treasury shares in the calculation of percentage of class.

(2) Includes stock options that are currently exercisable into 30,000 shares of common stock.

Also includes 1,870 shares held in an investment club over which Mr.

Langan has shared voting and investment power.

As of the date of this report, Mr.

Langan owns less than 0.1% of the investment club.

(3) Number of shares is rounded to the nearest whole number.

The actual amount is 33,606.681 shares.

Includes stock options that are currently exercisable into 20,000 shares of common stock.

(4) Includes 1,870 shares held in an investment club over which Mr.

Chhay has shared voting and investment power.

As of the date of this report, Mr.

Chhay owns approximately 4.7% of the investment club.

(5) Includes stock options that are currently exercisable into 20,000 shares of common stock.

Also includes 1,870 shares held in an investment club over which Mr.

Reese has shared voting and investment power.

As of the date of this report, Mr.

Reese owns approximately 1.8% of the investment club.

(6) Based on the most recently available Schedule 13G filed with the SEC on February 1, 2023 by BlackRock Inc.

BlackRock beneficially owned 575,106 shares, with sole voting power over 565,882 shares and sole dispositive power over 575,106 shares.

The address of BlackRock is 55 East 52nd Street, New York, New York 10055.

(7) Based on the most recently available Form 4 filed with the SEC on September 28, 2023 by ADW Capital Partners, L.P., ADW Capital Management, LLC and Adam D.

(4) Based on the most recently available Schedule 13G filed with the SEC on January 26, 2024 by BlackRock Inc.

BlackRock beneficially owned 633,098 shares, with sole voting power and sole dispositive power over all such shares.

The address of BlackRock is 50 Hudson Yards, New York, New York 10001.

(5) Based on the most recently available Schedule 13G filed with the SEC on February 14, 2024 by ADW Capital Partners, L.P., ADW Capital Management, LLC and Adam D.

ADW Capital Management, LLC is the general partner and investment manager of ADW Capital Partners, L.P.

Wyden is the sole manager of ADW Capital Management, LLC.

ADW Capital Partners, L.P is the record and direct beneficial owner of 941,000 shares, with sole voting power and sole dispositive power over all such shares.

ADW Capital Partners, L.P is the record and direct beneficial owner of 934,592 shares, with shared voting power and shared dispositive power over all such shares.

The address of each of these reporting persons is 6431 Allison Road, Miami Beach, Florida 33141.

(6) Based on the most recently available Schedule 13G filed with the SEC on February 13, 2024 by The Vanguard Group - 23-1945930.

The Vanguard Group - 23-1945930 beneficially owned an aggregate of 492,823 shares, with sole voting power over 0 shares, shared voting power over 15,450 shares, sole dispositive power over 468,833 shares and shared dispositive power over 23,990 shares.

The address of Vanguard Group - 23-1945930 is 100 Vanguard Blvd., Malvern, Pennsylvania 19355.

(7) Based on the most recently available Schedule 13G filed with the SEC on November 7, 2024 by Progeny 3, Inc.

Progeny 3, Inc.

beneficially owned 460,968 shares, with sole voting power and sole dispositive power over all such shares.

Jon Hemingway controls Progeny 3, Inc.

The address of Progeny 3, Inc.

is 5209 Lake Washington Blvd NE, Suite 200, Kirkland, Washington 98033.

The Company is not aware of any arrangements that could result in a change in control of the Company.

6 unchanged sentences

Colby Langan, one of Eric Langan's adult children mentioned above, is currently the President of RCI Development Services, Inc., which manages strategy on the Company's new business ventures, and received $180,960, $184,068, and $138,762 in employment compensation during the fiscal year ended September 30, 2024, 2023, and 2022, respectively.

Included also in the adult children mentioned above is Ashley Wilkins, Eric Langan's daughter, who works in the Treasury Department of the Company, and received $123,600 in employment compensation during the fiscal year ended September 30, 2024.

In October 2021, we borrowed $500,000 from Ed Anakar, President of RCI Management Services, Inc.

and our Director of Operations and brother of former director Nourdean Anakar, and $150,000 from Allen Chhay, brother of Company CFO, Bradley Chhay, as part of a larger group of private lenders (see Note 8 to our consolidated financial statements).

Their promissory notes bear interest at the rate of 12% per annum and mature in October 2024.

Their promissory notes bear interest at the rate of 12% per annum and mature in October 2024 and later extended to October 2026.

The notes are payable in monthly installments of interest only with a balloon payment of all unpaid principal and interest due at maturity.

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The following table sets forth the aggregate fees paid or accrued for professional services and the aggregate fees paid or accrued for audit-related services and all other services rendered by Marcum LLP and Friedman LLP for the fiscal 2024 and 2023.

Marcum 2023 Friedman 2023 Friedman 2022

Marcum 2024 Marcum 2023 Friedman 2023

Audit fees $ 1,313,698 $ 659,789 $ 523,017

5 unchanged sentences

“Audit fees” include fees billed for professional services rendered in connection with the annual audit and quarterly reviews of the Company’s consolidated financial statements, the audit of internal control over financial reporting as required by the Sarbanes-Oxley Act of 2002, and assistance with securities filings other than periodic reports.

“Audit-related fees” include professional services in relation to a Form S-3 filing.

“Audit-related fees” include professional services in relation to review of our franchise disclosure document.

“Tax fees” include consultation related to tax compliance and tax structuring.

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The Audit Committee’s outside auditor independence policy provides for pre-approval of all services performed by the outside auditors.

Merger of Marcum LLP with CBIZ, Inc.

On July 30, 2024, CBIZ, Inc.

entered into an agreement and plan of merger with Marcum LLP with an anticipated close date of November 1, 2024.

On August 15, 2024, Marcum LLP informed the Company that it would not be independent with respect to the completion of the fiscal year ended September 30, 2024, integrated audit as a result of internal audit services that were performed by CBIZ, Inc.

during the period under audit.

For the following reasons, the Audit Committee of the Board of Directors of the Company and Marcum have each concluded, and are of the view that a reasonable investor with knowledge of all relevant facts and circumstances would conclude, that the provision of these services did not impair Marcum LLP’s objectivity and impartiality with respect to Marcum LLP’s integrated audit of the Company’s financial statements and internal controls over financial reporting:

Majority of the CBIZ, Inc.

services were performed prior to July 31, 2024, when the proposed transaction between CBIZ, Inc.

and Marcum LLP was publicly announced.

The audit engagement team was not aware of this proposed transaction prior to July 31, 2024.

services did not involve decision making and supervisory responsibilities over and on behalf of the Company management.

The Company terminated CBIZ, Inc.’s engagement promptly after the merger announcement and hired an unrelated third party to reperform all the work performed by CBIZ, Inc.

in relation to the fiscal year ending September 30, 2024.

Marcum audit planning and procedures did not rely upon any testing performed by CBIZ, Inc.

After Marcum LLP’s expected merger with CBIZ, Inc., no personnel from CBIZ, Inc.

who worked on the Company’s engagement will be part of the audit team or have any involvement in the audit.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

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4.11 Amended and Restated 12% Unsecured Promissory Note (form of amortizing payment schedule version of the note) (Incorporated by reference from Form 8-K filed with the SEC on October 26, 2023) *

4.12 P romissory Note for $20,000,000 with Centennial Bank ( Incorporated by reference from Form 8-K filed with the SEC on May 3, 2024) *

4.13 The description of our common stock (Incorporated by reference from Form 10-K filed with the SEC on December 14, 2020) *

10.1 Employment Agreement with Eric S.

(Incorporated by reference from Form 8-K filed with the SEC on July 2, 2021) *

(Incorporated by reference from Form 8-K filed with the SEC on September 5, 2024) *

10.2 Employment Agreement with Bradley Chhay (Incorporated by reference from Form 8-K filed with the SEC on A ugust 30, 2023 ) *

10.3 Employment Agreement with Travis Reese (Incorporated by reference from Form 8-K filed with the SEC on July 2, 2021) *

10.3 Employment Agreement with Travis Reese (Incorporated by reference from Form 8-K filed with the SEC on September 5, 2024) *

10.4 Loan Agreement between RCI Holdings, Inc.

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10.49 Non-Competition Agreement with Duncan Burch dated March 16, 2023 (Incorporated by reference from Form 8-K filed with the SEC on March 17, 2023) *

10.50 Loan Agreement between RCI Holdings, Inc.

and Centennial Bank dated April 30, 2024 (Incorporated by reference from Form 8-K filed with the SEC on May 3, 2024) *

10.51 Absolute Unconditional and Continuing Guaranty of RCI Hospitality Holdings, Inc.

dated April 30, 2024 (Incorporated by reference from Form 8-K filed with the SEC on May 3, 2024) *

10.52 Absolute Unconditional and Continuing Guaranty of Eric S.

Langan dated April 30, 2024 (Incorporated by reference from Form 8-K filed with the SEC on May 3, 2024) *

19.1 P olicy on Insider Trading

21.1 Subsidiaries

23.1 C onsent of Marcum LLP

23.1 Consent of Marcum LLP

23.2 Consent of Friedman LLP

5 unchanged sentences

pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18 U.S.C.

97.1 Policy for Recovery of Erroneously Awarded Incentive Compensation

101.INS Inline XBRL Instance Document

101.SCH Inline XBRL Taxonomy Extension Schema

101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase

101.DEF Inline XBRL Taxonomy Extension Definitions Linkbase

101.LAB Inline XBRL Taxonomy Extension Label Linkbase

101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

97.1 Policy for Recovery of Erroneously Awarded Incentive Compensation (Incorporated by reference from Form 10-K filed with the SEC on December 14, 202 3 ) *

101 The following financial information from RCI Hospitality Holdings, Inc.'s Annual Report on Form 10-K for the year ended September 30, 2024 formatted in Inline XBRL (Extensible Business Reporting Language) includes:

(i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Changes in Equity, (iv) the Consolidated Statements of Cash Flows, and (v) Notes to the Consolidated Financial Statements.

104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Incorporated by reference from our previous filings with the SEC.

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Elaine Martin Director December 16, 2024

/s/ Arthur Allan Priaulx

Arthur Allan Priaulx Director December 14, 2023

Arthur Allan Priaulx Director

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures