1172852--4/13/2009--VCG_HOLDING

related topics

{stock, price, share}

{interest, director, officer}

{stock, price, operating}

{loss, insurance, financial}

{cost, contract, operation}

{acquisition, growth, future}

{control, financial, internal}

{condition, economic, financial}

{property, intellectual, protect}

{capital, credit, financial}

{product, market, service}

{loan, real, estate}

{provision, law, control}

{personnel, key, retain}

We have had limited operations which makes our future operating results difficult to predict. Our inability to obtain capital, use internally generated cash, or use our securities or debt to finance future expansion efforts could impair the growth and expansion of our business. Our business has been, and may continue to be, adversely affected by disruptions in the credit markets, including reduced access to credit and higher costs of obtaining credit. Our business has been, and may continue to be, adversely affected by conditions in the U.S. financial markets and economic conditions generally. Our acquisitions may result in disruptions in our business and diversion of management s attention. Our business is subject to risks associated with geographic market concentration. Our business operations are subject to regulatory uncertainties which may affect our ability to acquire additional nightclubs, remain in operation or be profitable. There is substantial competition in the nightclub entertainment industry, which may affect our ability to operate profitably or acquire additional nightclubs. If we are unable to effectively promote our brands and establish a leading position in the marketplace, our business may fail. Our failure to protect our brand may undermine our competitive position, and litigation to protect our brands or defend against third-party allegations of infringement may be costly. Our business is dependent upon management and employees for continuing operations and expansion. Troy Lowrie, our Chairman of the Board and CEO, may have potential conflicts of interest with the Company, which may adversely affect our business. He beneficially owns a significant number of shares of our common stock, which will have an impact on all major decisions on which our stockholders may vote and which may discourage an acquisition of our Company. We must comply with all licenses and permits relating to the sale of alcohol. Activities or conduct at our nightclubs may cause us to lose necessary business licenses, expose us to liability, or result in adverse publicity, which may increase our costs, divert management s attention from our business and cause our stockholders to lose confidence in us, thereby lowering our profitability and our stock price. Our industry is viewed negatively by many for moral, religious and other reasons and, therefore, the market for our securities is smaller than for other securities and an investor may find it hard to sell our securities. Our business plan and proposed strategy has not been independently evaluated. We may be subject to uninsured risks which, if realized, could expose us to money damages, which we may be unable to pay. Provisions in our Bylaws provide for indemnification of officers and Directors, which could require us to direct funds away from our business. We could use the issuance of additional shares of our authorized stock to deter a change in control. We have entered into employment agreements with Troy Lowrie and Micheal Ocello that contain features that may discourage a change of control. We must meet the NASDAQ Global Market continued listing requirements or we risk delisting, which may decrease our stock price and make it harder for holders of our securities to trade in them. Until our Board of Directors and Audit Committee are in compliance with the NASDAQ independence requirements, there is a risk that our stockholders and investors may lose confidence in our ability to manage our business in a manner consistent with the best interest of our stockholders. Securities analysts may not initiate coverage or continue to cover our common stock, and this may have a negative impact on our common stock s market price. In the past, we have raised substantial amounts of capital in private placements, and if we fail to comply with the applicable securities laws, ensuing rescission rights or lawsuits would severely damage our financial position. The application of the penny stock rules could adversely affect the market price of our common stock and increase the transaction costs to sell those shares. Because we do not intend to pay any dividends on our common stock, purchases of our common stock may not be suited for investors seeking dividend income. Future sales of our common stock may depress our stock price. A significant amount of common stock is subject to issuance upon exercise of securities to purchase common stock. The exercise and sale of these financial instruments could depress the market price of our common stock. Ownership could be diluted by future issuances of our stock, options, warrants or other securities. There is a limited public trading market for our common stock. Our stock price has been volatile and may fluctuate in the future. If we fail to implement effective internal controls required by the Sarbanes-Oxley Act of 2002, to remedy any material weaknesses in our internal controls that we may identify, or to obtain the attestation required by Section 404 of the Sarbanes-Oxley Act of 2002, such failure could result in material misstatements in our financial statements, cause investors to lose confidence in our reported financial information and have a negative effect on the trading price of our common stock.

Full 10-K form ▸

1172852--4/13/2009--VCG_HOLDING_CORP