RCI HOSPITALITY HOLDINGS INC

5. Selected Account Information

The components of receivables, net are as follows (in thousands):

Notes receivable consist primarily of secured promissory notes executed between the Company and various buyers of our businesses and assets with interest rates ranging from 6% to 9% per annum and having original terms ranging from 1 to 20 years.

The components of prepaid expenses and other current assets are as follows (in thousands):

5. Selected Account Information - continued

The components of accrued liabilities are as follows (in thousands):

The components of selling, general and administrative expenses are as follows (in thousands):

The components of impairments and other charges, net are as follows (in thousands):

6. Property and Equipment

Property and equipment consisted of the following (in thousands):

Included in buildings and leasehold improvements above are construction-in-progress amounting to $15.0 million and $7.7 million as of September 30, 2024, and 2023, respectively, which are mostly related to Bombshells development projects.

Depreciation expense was approximately $12.9 million, $11.6 million, and $10.3 million for fiscal years 2024, 2023, and 2022, respectively. Impairment loss for property and equipment, including those later reclassified to assets held for sale, was $10.6 million, $58,000, and $1.0 million for fiscal 2024, 2023, and 2022, respectively.

7. Goodwill and Other Intangible Assets

Goodwill and other intangible assets consisted of the following (in thousands):

7. Goodwill and Other Intangible Assets - continued

Substantially all of our goodwill and other intangible assets belong to our Nightclubs segment.

Definite-lived intangible assets consist of the following (in thousands):

As of September 30, 2024 and 2023, the accumulated impairment balance of indefinite-lived intangibles was $28.8 million and $16.9 million, respectively, while the accumulated impairment balance of goodwill was $34.3 million and $25.4 million, respectively. As of September 30, 2024 and 2023, the gross amount of goodwill amounted to $96.2 million and $96.2 million, respectively. Future amortization expense related to definite-lived intangible assets that are subject to amortization at September 30, 2024 is: 2025 - $2.3 million; 2026 - $2.3 million; 2027 - $2.2 million; 2028 - $1.5 million; 2029 - $1.5 million; and thereafter - $10.2 million.

Indefinite-lived intangible assets consist of SOB licenses, liquor licenses, and tradenames, which were obtained as part of acquisitions. These licenses are the result of zoning ordinances, thus are valid indefinitely, subject to filing annual renewal applications, which are done at minimal costs to the Company. We considered certain licenses that are associated with leased locations as definite-lived. The discounted cash flow of the income approach method was used in calculating the value of these licenses in a business combination, while the relief-from-royalty method was used in calculating the value of tradenames. During the fiscal year ended September 30, 2024, the Company recognized a $11.8 million impairment related to the SOB licenses ofseven clubs, a $8.9 million impairment related to goodwill offour reporting units, and a $693,000 impairment related to tradename ofone club. During the fiscal year ended September 30, 2023, the Company recognized a $6.5 million impairment related to the SOB licenses ofeight club and a $4.2 million impairment related to goodwill offour reporting unit. During the fiscal year ended September 30, 2022, the Company recognized a $293,000 impairment related toone club's SOB licenses and a $566,000 impairment related to the goodwill ofone reporting unit.