UPDATE 1-Rick's Cabaret to buy upscale nightclub for $2.3 mln

* To buy Ft. Worth, Texas-based Cabaret North

* Acquisition to add annual rev of $2.5 mln-$3 mln

* Increases presence in Dallas-Ft. Worth market to 4 clubs

* Shares up more than 1 pct

Sept 28 (Reuters) - Rick's Cabaret International Inc (RICK.O) said it agreed to buy Cabaret North, an upscale gentlemen's club in Texas, for $2.3 million to boost its presence in the Dallas-Ft. Worth market.

The acquisition, which is expected to close on Wednesday, will add revenue of $2.5 million to $3 million annually and earnings before income tax, depreciation and amortization in the range of $800,000 to $1 million, the company said.

Rick's Cabaret said the deal will increase its presence in the Dallas-Ft. Worth market to four clubs.

In August, the adult nightclub operator said it raised $7.2 million through convertible debentures to fund future acquisitions.

Rick's Cabaret, which acquired six clubs in 2008, will also receive an option to buy Cabaret North's five-acre property within 19 months for about $2.4 million.

Rick's Cabaret operates upscale adult nightclubs that offer live entertainment, dining and bar operations under the names "Rick's Cabaret," "XTC," "Club Onyx" and "Tootsie's Cabaret."

Shares of the Houston-based company were up 12 cents at $8.09 Monday morning on Nasdaq. (Reporting by Mihir Dalal in Bangalore; Editing by Deepak Kannan)