As filed with the Securities and Exchange Commission on ~~January~~June 144, 2010

Registration No. ~~333-~~

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-1

REGISTRATION STATEMENT

UNDER THE SECURITIES ACT OF 1933

ULTIMATE ESCAPES, INC.

(Exact name of registrant as specified in its charter)

Delaware	7011	26-0188408
(State or other jurisdiction of	Primary Standard Industrial	(IRS Employer
(State or other jurisdiction of incorporation or organization)	Primary Standard Industrial Classification Code Number	(IRS Employer Identification Number)
incorporation or organization)	Classification Code Number	Identification Number)

3501 W. Vine Street, Suite 225

Kissimmee, Florida 34741

(407) 483-1900

(Address, Including Zip Code and Telephone Number, ~~Including Area Code, of Registrant’s Principal~~

~~Executive~~Including Area Code, of Registrant’s Principal Executive Offices)

James M. Tousignant

President and Chief Executive Officer

Ultimate Escapes, Inc.

3501 W. Vine Street, Suite 225

Kissimmee, Florida 34741

(407) 483-1900

Copies to:

Alan I. Annex, Esq. ~~Jason Simon, Esq. Greenberg Traurig, LLP MetLife Building 200 Park Avenue New York, NY 10166 (212) 801-9200~~

Jason Simon, Esq.

Greenberg Traurig, LLP

MetLife Building

200 Park Avenue

New York, NY 10166

(212) 801-9200

(Name, Address, Including Zip Code and Telephone Number,

Including Area Code, of Agent for Service)

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on a delayed or or continuous basis pursuant to Rule 415 under the Securities Act of 1933, ~~check~~ check the following box. ox

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier ~~effective~~ effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(c) under ~~the~~ the Securities Act, check the following box and list the Securities Act ~~registration~~ registration statement number of the earlier effective registration statement for the same offering. o¨

If this form is a post-effective amendment filed pursuant to Rule 462(d) under ~~the~~ the Securities Act, check the following box and list the Securities Act ~~registration~~ registration statement number of the earlier effective registration statement for the same offering. o¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o Accelerated filer o Non-accelerated filer o (Do not check if a smaller reporting company) Smaller reporting company x

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price(1)			Amount of Registration Fee
	Amount to be Registered (1)			Proposed Maximum Offering Price Per Share (2)		Proposed Maximum Aggregate Offering Price		Amount of Registration Fee
Common Stock, par value $.0001 per share	$	40,250,000		$	2,870
Title of Each Class of Securities to be Registered
Warrants, each to purchase one share of common stock		2,075,000		$	-	$	-	$	-	(3)
Common stock, par value $0.0001 per share, issuable upon exercise of warrants		2,075,000	(4)	$	1.20		2,490,000	$	177.54
Common stock, par value $0.0001 per share		587,368		$	1.20	$	704,841.60	$	50.26
Common stock, par value $0.0001 per share, issuable upon exercise of warrants		10,000,000	(5)	$	1.20	$	12,000,000	$	855.60
Common stock, par value $0.0001 per share, issuable upon conversion of ownership units of Ultimate Escape Holdings, LLC		7,556,675		$	1.20	$	9,068,010	$	646.55

(1) ~~Estimated in~~ ~~accordance~~Pursuant ~~with~~to Rule ~~457(o)~~416 ofunder the Securities Act of 1933, asthis ~~amended,~~Registration ~~solely for~~Statement ~~purposes~~also ofcovers ~~calculating~~any ~~the~~additional ~~registration~~securities ~~fee. Includes shares of common stock~~ that may be ~~purchased~~offered byor ~~the~~issued ~~underwriters~~in toconnection ~~cover~~with ~~over-allotments~~any stock split, if ~~any~~stock dividend or similar transaction.

(2)

Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(f)(1) and (3) and Rule 457(c) under the Securities Act of 1933, based on the average of the high and low sale prices of the Registrant’s common stock on June 2, 2010, as reported by the Over-the-Counter bulletin board.

(3)	Pursuant to Rule 457(g) of the Securities Act, no separate registration fee is required with respect to the warrants.

(4)	Issuable upon exercise of the warrants being registered hereunder.

(5)	Issuable upon exercise of outstanding publicly traded warrants.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act, as amended, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to such Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED JANUARY 14, 2010

PROSPECTUS

SUBJECT TO COMPLETION, DATED JUNE 4, 2010

Ultimate Escapes, Inc.

20,219,043 Shares of Common Stock

~~Common~~2,075,000 ~~Stock~~Warrants

~~We are~~This ~~offering shares~~prospectus ofrelates ~~our common stock. Our common stock is listed on the NYSE Amex under the symbol “UEI”. Prior~~ to the ~~effectiveness~~issuance ofby ~~the~~us ~~registration statement~~ of ~~which~~ ~~this prospectus is a part~~19,631,675 weshares ~~will effect a reverse stock split anticipated to be on a 1-for- basis. The objective~~ of ~~the reverse stock split is to maintain a stock price for~~ our common stock ~~substantially above the minimum price required to maintain our NYSE Amex listing. The last reported sale price for our common stock on January 11~~, ~~2010 was~~par value $30.700001 per share, ~~(or~~of ~~$ per share after giving effect to the 1-for- reverse stock split).~~which:

~~Price~~· to10,000,000 ~~Public~~shares ~~Underwriting~~are ~~Discounts~~issuable ~~and~~upon ~~Commissions~~the ~~Proceeds,~~exercise ~~Before~~of ~~Expenses,~~outstanding towarrants ~~Ultimate~~originally ~~Escapes,~~issued ~~Inc.~~in ~~Per~~our ~~Share~~initial $public $offering $pursuant ~~Total~~to $a $prospectus $dated October 23, 2007;

We· ~~have granted~~2,075,000 ~~the underwriters for this offering an option to purchase up to an additional~~ shares ofare ~~common~~issuable ~~stock~~upon at the ~~public offering price, less the underwriting discount, to cover over-allotments. The underwriters may~~ exercise ~~this option at any time and from time to time within 30 days after the date~~ of ~~this~~outstanding ~~prospectus. We~~warrants ~~expect~~issued ~~that~~in ~~the~~a ~~shares of~~private ~~common~~placement ~~stock will be ready for delivery~~ to ~~investors~~our onfounder; ~~or about , 2010.~~and

~~Investing~~· in7,556,675 ~~our~~shares ~~securities~~of ~~involves risks.~~common ~~You~~stock ~~should~~are ~~consider~~issuable ~~the~~upon ~~risks~~conversion ~~that~~of weownership ~~have~~units ~~described~~of inone ~~Risk Factors beginning on page 7~~ of ~~this~~our ~~prospectus~~subsidiaries, ~~before~~Ultimate ~~buying~~Escapes ~~our securities~~Holdings, LLC.

This prospectus also relates to the resale by selling stockholders of up to (i) 2,075,000 warrants issued in a private placement to our founder and (ii) 587,368 shares of common stock issued to the selling stockholders in private transactions.

Each warrant entitles the holder to purchase one share of our common stock. In order to obtain the shares, the holders of the warrants must pay an exercise price of $8.80 per share. To the extent that the holders exercise, for cash, all of the warrants registered for resale under this prospectus, we would receive up to $18,260,000 in the aggregate from such exercise. We intend to use such proceeds, if any, for working capital and other general corporate purposes.

The selling stockholders may dispose of their shares of common stock or warrants in a number of different ways and at varying prices. See “Plan of Distribution.”

Our common stock and warrants are quoted on the Over-the-Counter bulletin board (“OTC bulletin board”) maintained by the Financial Industry Regulatory Authority under the symbol “ULEI” and “ULEIW”, respectively. The closing bid prices for our common stock and warrants on June 2, 2010 were $1.20 per share and $0.01 per warrant, respectively, as reported on the OTC bulletin board.

We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision.

Investing in our securities involves risks. You should consider the risks that we have described in “Risk Factors” beginning on page 6 of this prospectus before buying our securities.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus is , 2010.

TABLE OF CONTENTS

	Page	~~Page~~
Prospectus Summary	1	1
Risk Factors	6	6
Cautionary Note Regarding Forward-Looking Statements	21	20
Use of Proceeds	21	21
Capitalization		22
Price Range of Securities and Dividends	21
Price Range of Securities and Dividends		23
Selected Financial Data	23
Selected Financial Data		25
Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Management’s Discussion and Analysis of Financial Condition and Results of Operations		29
Business	37
Business		39
Management	51
Management		57
Certain Relationships and Related Party Transactions	61
Certain Relationships and Related Party Transactions		67
Principal and Selling Stockholders	67
Security Ownership of Certain Beneficial Owners and Management		73
Plan of Distribution	74
Description of Securities	75	75
Underwriting		79
Legal Matters	80
Legal Matters		81
Disclosure of Commission Position on Indemnification for Securities Act Liabilities	80
Experts		81
Where You Can Find More Information	81
Indemnification for Securities Act Liabilities		81
Index to Consolidated Financial Statements	82
Where You Can Find More Information		82
Index to Consolidated Financial Statements		F-1

You should rely only on the information contained in this prospectus. Neither the ~~underwriters~~selling ~~nor~~stockholders nor we have authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. Neither the ~~underwriters~~selling stockholders nor we are making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus is accurate as of the date on the front cover of this prospectus only. Our business, financial condition, results of operations and prospects may have changed since that date.

PROSPECTUS SUMMARY

This summary highlights basic information about us and this offering. This summary does not contain all of the information you should consider before investing in our common stock and warrants. You should read this entire prospectus carefully before making an investment decision. When we use the words “Company,” “we,” “us” or “our company” in this prospectus, we are referring to Ultimate Escapes, Inc., a Delaware corporation, and our subsidiaries, unless it is clear from the ~~context~~ context or expressly stated that these references are only to Ultimate Escapes, Inc. Unless otherwise indicated, all information contained in this prospectus ~~assumes~~ ~~that~~assumes ~~the underwriters will not exercise their over-allotment option and~~ that no outstanding stock options or warrants will be exercised. This ~~prospectus~~ prospectus contains forward-looking statements, which involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under “Risk Factors” and elsewhere in this prospectus.

Unless otherwise indicated, all share amounts and prices in this prospectus (other than in the financial statements and in the summary and selected financial data derived therefrom) assume the consummation of a reverse stock split, at an assumed ratio of 1-to- , to be effected prior to the effectiveness of the registration statement of which this prospectus is a part, with the exact ratio and timing of the reverse stock split to be determined by our board of directors.

Our Company

We operate a family of luxury destination club offerings, including Elite ~~ClubTM,~~Club TM , Signature ~~ClubTM~~Club TM and Premiere ~~ClubTM,~~Club TM , with over 1,200 affluent club members, as well as an experienced management ~~team~~ team and increasing market share. We provide club members and their families ~~with~~ with flexible access to a growing portfolio of multi-million dollar club residences, exclusive member services and resort amenities. We believe that we offer our club members access to more club destinations than any other luxury ~~destination~~ destination club in the world, with over ~~130~~140 luxury club residences in 45 global destinations available today in the mainland United States and Hawaii, Mexico, Central America, the Caribbean and Europe. Elite Club properties have a target home value of approximately $3 million, Signature Club properties have a target home value of ~~average~~ approximately $2 million and Premiere Club properties have a target home value of approximately $1 million. As of December 31, 2009, we had 433 Elite Club members, 545 Signature Club members and 236 Premiere Club members.

Our strategy is to combine the privacy and intimacy of multi-million dollar residences in a wide variety of global resort destinations with “white glove” member concierge services and club amenities. We offer a unique and ~~compelling~~ compelling value proposition that is a cost effective vacation alternative for a large, affluent target market. For the consumer market, a club membership offers a more flexible, ~~energy~~ efficient and cost effective vacation alternative as compared with the high costs, inefficiencies and hassles of second home ownership in this cost range, the expense, uncertainties and time-consuming effort to rent luxury villas in the United States and international markets or the high costs and typical small rooms of luxury hotels. For the corporate market, our corporate membership option targets the growing multi-billion dollar corporate reward and incentive market, and offers corporations an affordable, flexible corporate reward and incentive program for top performing employees, senior executives, board members, key advisors, existing customers and new prospects.

Our Industry

Although there are significant differences between destination club offerings and timeshare offerings, we believe that the continued growth of luxury destination clubs will parallel the dramatic growth of timeshare sales over the last 20 years. The increasing wealth of “baby boomers,” coupled with the desirability of shared-use vacation alternatives, bodes well for continued destination club growth over many years, particularly given the low 1% market penetration of qualified buyers of luxury share-use vacation offerings, according to Ragatz Associates, an international consulting and market research firm in the resort real estate industry. If luxury destination clubs are able to achieve the same market penetration in their target market over the next 10 – 20 years as timeshare operators have achieved over the last 20 years, the luxury destination club industry could potentially grow from approximately 5,000 club members today to over 300,000 club members in 10 – 20 years (assuming a 5% market penetration of Spectrem Group’s estimated 6.7 million “millionaires” in the United States with assets of at least $1 million and 840,000 “pentamillionaires” in the United States with assets of at least $5 million), in addition to the large potential corporate membership market.

Our management believes that the emerging luxury destination club market is still in its infancy and has many years of continued growth potential when the global economy improves, as major resort and hospitality brands like the Ritz Carlton Destination Club and other luxury brands and new market entrants continue to enter the luxury marketplace. Our management believes that barriers to entry in the luxury destination club market are increasing and further consolidation is likely, forcing smaller destination club players to focus on niche markets, sell to or merge with larger clubs or go out of business. Established hospitality and resort brands will likely enter the growing luxury destination club market in greater numbers, as most recently demonstrated by the 2009 launch of the Ritz Carlton Destination Club. In addition, new destination clubs will continue to form in Europe and Asia, as well as existing clubs expanding their presence internationally to address greater affluence and future high growth markets in Europe and Asia.

Our Products and Services

We offer a variety of club membership plans that provide club members between 14 and 60 days of use annually at a unique collection of club destinations and affiliate destinations located around the world. Our destination properties are located in or near resort markets with global tourist and business appeal that offer club members a world class vacation experience. By combining the best elements of multi-million dollar single family residences with world class amenities and concierge service, management believes it has created the best and most cost-effective option for luxury second-home ownership available in the market today. Other services provided by us include:

· The Ultimate Collection -— provides club members with access to over 140 luxury four- and five-star hotels in many of the world’s most desirable cities and resorts throughout the United States, Europe, Asia, the Middle East, Central America and South America, Africa and Australia.

· The Ultimate Rewards Program -— rewards club members who recommend a friend, family member or business colleague for club membership that subsequently joins us. Club members can redeem reward points for extra club days, annual dues, private yacht and jet charters, private chef services, trips to special events and much more.

We have invested millions of dollars in developing a proprietary web-based technology platform and we are planning to begin using “smart home” technology in the future to improve our ability to manage club properties, reduce energy and water consumption and provide club members with a safer and more comfortable experience and home environment.

Our Strengths

Our management believes that our primary business strengths include:

· Strong, experienced management team with demonstrated leadership and a track record of innovation;

· Best value when compared with other luxury vacation alternatives and broadest range of product offerings of any destination club;

· Unique business model, resulting in improving economies of scale and operational efficiencies;

· High quality member services, large club membership base and strong member loyalty, resulting in growing recurring revenue base and high 97-99% member renewal rates;

· Substantial real estate portfolio recently appraised at $153.6 million with approximately $123.3 million of debt as of September 30, 2009 and approximately $30.3 million of equity; and

· Planned use of energy efficient, “smart house” technology, including remote access, monitoring and control of HVAC, computer, electrical, lighting, audio, security and landscaping systems, which we anticipate will improve member satisfaction, maintain our properties better and reduce operating costs, energy costs and utility costs in club properties.

Our Growth Strategy

Our management expects to achieve ~~significant~~strong EBITDA and revenue growth over the ~~next~~ next several years.

Key elements of our future growth strategy include:

Expand organic sales;

Pursue additional acquisitions;

Continue global expansion;

Introduce new club offerings;

Pursue marketing partnerships and joint ventures with real estate developers and hospitality REITs; and

Introduce “private label” offerings with resort and hospitality brands.

Corporate Information

We were incorporated in Delaware on May 14, 2007 under the name “Fortress America Acquisition Corporation II” (subsequently changed to Secure America Acquisition Corporation) as a blank check company for the purpose of acquiring one or more domestic or international businesses. On October 29, 2009, we consummated a business combination with Ultimate Escapes Holdings, LLC, ~~a Delaware limited liability company~~ (“Ultimate Escapes Holdings”), pursuant to a Contribution Agreement, as amended (the “Contribution Agreement”), whereby we acquired ownership units in Ultimate Escapes Holdings and Ultimate Escapes Holdings became a subsidiary of us. In this prospectus, we refer to our acquisition of Ultimate Escapes Holdings pursuant to the Contribution Agreement as the “~~Acquisition~~reverse merger,” and we refer to the limited liability company membership units in Ultimate Escapes Holdings as “ownership units.” Effective upon the consummation of the ~~Acquisition~~reverse merger, we changed our name to Ultimate Escapes, Inc. Prior to the consummation of the ~~Acquisition,~~reverse merger, on September 15, 2009, Ultimate Escapes Holdings acquired all of the assets and business of its former parent company Ultimate Resort Holdings, LLC (“Ultimate Resort Holdings”), and also acquired a majority of the assets and business of Private Escapes Destination Clubs (“Private Escapes”).

Our principal executive offices are located at 3501 West Vine Street, Suite 225, Kissimmee, Florida 34641, and our telephone number is (407) 483-1900. Our website is www.ultimateescapes.com. The information contained in our website is not a part of this prospectus.

Public Stockholders’ Warrants

Each warrant issued in our initial public offering entitles the registered holder to purchase one share of our common stock at a price of $8.80 per share. As of April 30, 2010, 10,000,000 of these public warrants were issued and outstanding. The warrants, none of which have been exercised as of April 30, 2010, will expire on October 29, 2013 at 5:00 p.m., New York City time.

We may call the warrants for redemption at any time beginning one year after the completion of the reverse merger:

•

in whole and not in part;

•

at a price of $0.01 per warrant at any time after the warrants become exercisable;

•

upon not less than 30 days’ prior written notice of redemption to each warrant holder; and

•

if, and only if, after the expiration of one year after the reverse merger, the reported last sale price of the common stock equals or exceeds $15.05 per share for any 20 trading days within a 30-trading day period ending on the third business day prior to the notice of redemption to warrantholders.

The warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price, by certified check payable to us, for the number of warrants being exercised. The warrant holders do not have the rights or privileges of holders of common stock or any voting rights until they exercise their warrants and receive shares of common stock. After the issuance of shares of common stock upon exercise of the warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by stockholders.

Sponsor Warrants

Secure America Acquisition Holdings, LLC, our principal initial stockholder, purchased, in a private placement that occurred immediately prior to our initial public offering, warrants to purchase up to 2,075,000 shares of our common stock (the “sponsor warrants”), exercisable at a per-share price of $8.80. The sponsor warrants are identical to the public stockholder warrants, except that (i) the sponsor warrants are not subject to redemption so long as the sponsor warrants are held by Secure America Acquisition Holdings, LLC or its members as of the date of the issuance of the sponsor warrants, (ii) the sponsor warrants may be exercised on a cashless basis whereas the public stockholder warrants cannot be exercised on a cashless basis, and (iii) upon an exercise of the sponsor warrants, the holders of the sponsor warrants will receive unregistered shares of our common stock.

The sponsor warrants, unlike the public stockholder warrants, may be exercised on a cashless basis. Exercises on a cashless basis enable the holder to convert the value in the warrant (the fair market value of the common stock minus the exercise price of the warrant) into shares of common stock.

~~The~~THE ~~Offering~~OFFERING

Common Stock offered		shares
Shares Offered by the Company		19,631,675 shares of common stock, par value $0.0001 per share, of which:
Common Stock outstanding prior to this offering		2,486,495 shares(1)
		· 10,000,000 shares are issuable upon the exercise of outstanding warrants originally issued in our initial public offering;
Common Stock to be outstanding after this offering		shares(1)
		· 2,075,000 shares are issuable upon the exercise of outstanding warrants issued in a private placement to our founder; and
Use of proceeds		We intend to use the net proceeds of this offering for strategic acquisitions, reduction of indebtedness and general corporate purposes, including working capital. See “Use of Proceeds.”
		· 7,556,675 shares of our common stock are issuable upon conversion of ownership units of one of our subsidiaries, Ultimate Escapes Holdings (“Conversion Shares”).
NYSE Amex symbol		UEI
Shares and/or Warrants Offered by Selling Stockholders		(i) 2,075,000 warrants issued in a private placement to our founder; and (ii) 587,368 shares of common stock issued to the selling stockholders in private transactions
Risk Factors		See “Risk Factors” beginning on page 7 and the other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our common stock.
Warrant Exercise Price		$8.80 per share
Common Stock Outstanding as of April 30, 2010		2,759,094 shares
Common Stock to be Outstanding Assuming Exercise of All of the Warrants and Issuance of Conversion Shares		22,390,769 shares
Use of Proceeds		We will receive up to an aggregate of $18,260,000 from the exercise of the warrants, if they are exercised in full. We expect that any net proceeds from the exercise of the warrants will be used for general corporate purposes and to fund working capital.
		The selling stockholders will receive all of the proceeds from the sale of any shares of common stock and/or warrants sold by them pursuant to this prospectus. We will not receive any proceeds from these sales.
OTC Bulletin Board Symbols:
Common Stock		ULEI
Warrants		ULEIW

(1) Excludes the following:

• 7,556,675 shares of common stock issuable upon conversion of ownership units in Ultimate Escapes Holdings outstanding as of January 11, 2010;

• 7,000,000 shares of common stock issuable upon conversion of additional ownership units in Ultimate Escapes Holdings that may be issued as earn-out units pursuant to the terms of Ultimate Escapes Holdings’ amended and restated operating agreement;

• 53,427 shares of common stock issuable upon the exercise of stock options granted under our 2009 Stock Option Plan as of January 11, 2010;

• 1,137,773 shares of common stock reserved for further issuance under our 2009 Stock Option Plan as of January 11, 2010; and

• 12,075,000 shares of common stock issuable upon the exercise of all warrants outstanding as of January 11, 2010.

Unless otherwise indicated, all share amounts and prices in this prospectus (other than in the historical financial statements and in the summary and selected financial data derived therefrom) assume the consummation of a reverse stock split, at a ratio of 1-for- , to be effective prior to the effectiveness of the registration statement of which this prospectus is a part. The objective of the reverse stock split is to maintain a stock price for our common stock substantially above the minimum price required to maintain our NYSE Amex listing. All information in this prospectus assumes no exercise by the underwriters of their right to purchase up to an additional shares of common stock to cover over-allotments.

Summary Consolidated Financial Data ~~of Ultimate Escapes Holdings~~

Because the ~~Acquisition~~business combination with Ultimate Escapes Holdings was considered a reverse acquisition and recapitalization for accounting purposes, the ~~historical~~ historical financial statements of Ultimate Escapes Holdings became our historical financial statements. On September 15, 2009, Ultimate Resort Holdings contributed all of its assets and liabilities to its wholly-owned subsidiary, Ultimate Escapes Holdings. On September 15, 2009, Private Escapes contributed a majority of its assets, liabilities, properties and other rights to Ultimate Escapes Holdings in exchange for an 8% ownership interest in Ultimate Escapes Holdings. ~~The following summary consolidated historical financial information of Ultimate Escapes Holdings as of December 31~~Accordingly, ~~2008 and 2007 and for~~ the ~~years~~operating ~~then~~results ~~ended was derived from the audited consolidated financial statements~~ of ~~Ultimate~~Private Escapes ~~Holdings~~ are included in ~~this~~our ~~prospectus. The summary~~ consolidated ~~historical~~ financial ~~information of Ultimate Escapes Holdings as of and for the nine months ended September 30, 2009 and 2008 was derived from the unaudited condensed consolidated financial~~ statements ~~of Ultimate Escapes Holdings included in this prospectus and includes the unaudited results of the acquired operations of Private Escapes~~ from September 16, ~~2009 through~~ ~~September 30,~~ 2009. ~~The selected financial data of Private Escapes for periods prior to September 16, 2009 is included elsewhere in this prospectus.~~

The ~~results~~following oftable ~~operations~~summarizes ~~for~~our ~~the~~consolidated ~~interim~~financial ~~period~~data. ~~are~~Our ~~not~~summary consolidated ~~necessarily~~financial ~~indicative~~data ofis derived from our audited consolidated financial ~~the~~statements ~~results~~as of ~~operations~~December ~~which~~31, ~~might~~2009 beand ~~expected~~ for the ~~entire~~years ended December 31, 2009 and ~~year~~2008, which are included elsewhere in this prospectus. ~~This~~ The information provided below is only a summary and should be read in conjunction with our consolidated financial statements and related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” ~~and~~contained ~~the financial statements of Ultimate Escapes Holdings and Private Escapes and the notes thereto included~~ elsewhere in this prospectus.

	As of and for the Nine Months Ended September 30,						As of and for the Years Ended December 31,
	As of and for the Three Months Ended March 31,						As of and for the Years Ended December 31,
	2009			2008			2008			2007
	2010			2009			2009			2008
	(unaudited)			(unaudited)
	(In thousands)
Statement of Operations Data:
Revenues	$	257,~~061~~315		$	168,~~497~~628		$	2237,~~541~~011		$	1522,~~113~~541
Operating income (loss)		(3,~~823~~714	)		~~(11~~1,~~830~~048	)		(143,~~344~~411	)		(1713,~~853~~763	)
Net loss		(36,~~225~~472	)		(181,~~948~~224	)		(2312,~~222~~965	)		(2423,~~645~~222	)
Balance Sheet Data:
Total assets	$	~~216~~198,~~520~~688			N/A		$	~~131~~207,~~609~~616		$	~~135~~131,~~822~~498
Working capital		(1734,~~461~~372	)		N/A			(832,~~804~~711	)		(38,~~843~~917	)
Owners’ equity		(3429,~~579~~091	)		N/A			(3622,~~813~~986	)		(1536,~~668~~927	)

RISK FACTORS

Our business, industry and common stock are subject to numerous risks and uncertainties. The discussion below sets forth all of such risks and uncertainties that are material and presently known to us. Any of the ~~following~~ following risks, if realized, could materially and adversely affect our revenues, operating results, profitability, financial condition, prospects for ~~future~~ future growth and overall business, as well as the value of our common stock and warrants.

Risks Related to Our Company

We have a history of losses, and may never achieve or sustain profitability.

We incurred substantial losses, and we may continue to incur substantial losses in the future. We incurred net losses of $6.5 million, $13.0 million and $23.2 million during the three months ended March 31, 2010, the year ended December 31, 2009 and the year ended December 31, 2008, respectively. We have also experienced a decrease in new club membership sales and existing club member upgrades during 2009 and the first four months of 2010. These circumstances raise substantial doubt about our ability to continue to fund operating losses and provide necessary operating liquidity. Even if we do achieve profitability, we may be unable to sustain or increase our profitability in the future.

We have received a report from our independent registered public accounting firm expressing doubt regarding our ability to continue as a going concern.

Our independent registered public accounting firm noted in their report accompanying our consolidated balance sheets of December 31, 2009 and 2008 and the related consolidated statements of operations, changes in owners’ equity (deficit) and cash flows for the years ended December 31, 2009 and 2008 that our recurring losses from operations and ongoing requirements for additional capital investment raise substantial doubt about our ability to continue as a going concern. Management plans to maintain our viability as a going concern by:

if necessary, selling selected club properties;

closely maintaining and reducing operating expenses; and

seeking to raise additional working capital.

We cannot assure you that our plans will be successful. This doubt about our ability to continue as a going concern could adversely affect our ability to obtain additional financing at favorable terms, if at all, as such an opinion may cause investors to have reservations about our long-term prospects, and may adversely affect our relationship with customers and others. If we cannot successfully continue as a going concern, our stockholders may lose their entire investment in us.

Our business is capital intensive and the lack of available financing to fund the acquisition of additional destination club properties and our operations could adversely affect our ability to maintain and grow our club membership base which could adversely affect our business, financial condition and results of operations.

In order for our destination clubs to remain attractive and competitive, we have to spend a significant amount of money to keep the properties well maintained, modernized and refurbished and to add new luxury properties periodically to our portfolio of destination club properties as we add new club members. This creates an ongoing need for cash and, to the extent we cannot fund expenditures from cash generated by operations, funds must be borrowed or otherwise obtained. We could finance future expenditures from any of the following sources:

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cash flow from operations;

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non-recourse, sale-leaseback or other financing;

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bank borrowings;

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annual dues increases or club member assessments;

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public and private offerings of debt or equity;

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sale of existing real estate; or

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some combination of the above.

We might not be able to obtain financing for future expenditures on favorable terms or at all, which could inhibit our ability to continue to grow. Events during 2008 and 2009, including the failures and near failures of numerous financial services companies and the decrease in liquidity and available equity and debt capital have negatively impacted the capital markets for real estate investments. Accordingly, our financial results have been and may continue to be impacted by the cost and availability of funds needed to grow our business.

We have a substantial amount of indebtedness, which could adversely affect our financial position.

We have a substantial amount of indebtedness. As of March 31, 2010, we had total debt of approximately $120 million, consisting of $96 million of borrowings under our senior secured credit facility and $24 million of additional debt obligations secured by destination club properties. Our senior secured credit facility is an amended and restated revolving credit facility with CapitalSource, secured by our real estate assets, which will mature on April 30, 2011, subject to extension by us for up to two one-year periods. The maximum principal amount available to us under the credit facility is currently approximately $95 million, subject to a maximum borrowing base amount, calculated as a percentage of the appraisal value of all owned property encumbered by a mortgage in favor of CapitalSource. In addition, the revolving credit facility has minimum loan amortization amounts that require cumulative amortization of $10,300 by June 30, 2010 and $17,800 by December 31, 2010, with the remaining balance due on April 30, 2011 if we do not elect an extension. If we elect a first one-year extension, then cumulative amortization must be $22,800 by June 30, 2011 and $25,300 by December 31, 2011, with the remaining balance due on April 30, 2012 if we do not exercise a second extension. If we exercise the second one-year extension, then cumulative amortization must be $27,800 by June 30, 2012 and $30,300 by December 31, 2012, with the remaining balance due by April 30, 2013. The revolving credit facility includes financial and operational covenants that limit our ability to incur additional indebtedness and pay dividends as well as purchase or dispose of significant assets. Covenants in the revolving credit facility include obligations to maintain a cash coverage amount of one month’s debt service as of June 30, 2010 through September 29, 2010, two months debt service from September 30, 2010 through December 30, 2010, and three months debt service after December 31, 2010, to maintain a leverage ratio between debt and consolidated net worth of no more than 3.5 to 1, to comply with specified ratios of number of club properties to club members, to have a net loss of no more than $10 million in fiscal 2009 and $5 million in fiscal 2010, and to have net income in each year thereafter (as adjusted in each year for the non-refundable portion of new member initiation fees not yet recognized in income and, in 2009, for non-cash stock-based compensation), and to maintain a consolidated debt ratio of no more than 80%. Although we believe that we are in compliance with all of the covenants in the revolving credit facility, we have previously violated certain covenants contained in our prior revolving credit facility with CapitalSource, which covenant violations were waived by the lender, we cannot provide any assurance that in the future, if we were to need a waiver of a breach of a covenant, that such a waiver would be granted. In addition, we have approximately $24 million in additional indebtedness secured by real estate assets with various first and second mortgage lenders. In the event we default on our secured debt obligations, the lenders could enforce their rights under the loan agreements, which would impair our ability to conduct our business and have a material adverse effect on our business, financial condition and results of operations. If we are unable to make payments on one or more mortgages on the properties or otherwise default on our debt obligations, the lenders could foreclose on such properties, which would have a material adverse effect on our business, financial condition and results of operations. We may also incur significant additional indebtedness in the future. Our substantial indebtedness may:

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make it difficult for us to satisfy our financial obligations, including making scheduled principal and interest payments on our indebtedness;

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limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions or other general business purposes;

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limit our ability to use our cash flow or obtain additional financing for future working capital, capital expenditures, acquisitions or other general business purposes;

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require us to use a substantial portion of our cash flow from operations to make debt service payments;

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limit our flexibility to plan for, or react to, changes in our business and industry;

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place us at a competitive disadvantage compared to less leveraged competitors; and

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increase our vulnerability to the impact of adverse economic and industry conditions.

We may not be able to generate sufficient cash to service our debt obligations.

Our ability to make payments on and to refinance our indebtedness will depend on our financial and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business and other factors beyond our control. We may be unable to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness.

If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, or to sell assets, seek additional capital or restructure or refinance our indebtedness. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations. In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. Our senior secured credit agreement restricts our ability to dispose of assets, and requires the use of proceeds from any disposition of assets to repay our indebtedness. We may not be able to consummate those dispositions or to obtain the proceeds that we could realize from them and these proceeds may not be adequate to meet any debt service obligations then due.

The luxury vacation industry is highly competitive and we are subject to risks relating to competition that may adversely affect our performance.

We operate principally in the luxury vacation industry and compete against numerous global, regional and boutique destination clubs; as well as other shared usage or interval ownership resort and vacation property companies, real estate developers and sponsors; vacation home owners, brokers and managers; resort sponsors and managers; and, more broadly, luxury resorts and other transient/leisure accommodations; as well as alternative leisure and recreation categories, such as golf clubs or other club membership organizations. We have encountered and expect to encounter in the future intense competition from our rivals in the destination club industry and from other companies offering competitive products and services. Many of our competitors have greater consumer recognition or resources and/or more established and familiar products than us. The factors that we believe are important to customers include:

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number and variety of club destinations available to club members;

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quality of member services and concierge services;

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quality of destination club properties;

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pricing of club membership plans;

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type and quality of resort amenities offered;

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reputation of club;

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destination club properties in proximity to major population centers;

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availability and cost of air and ground transportation to destination club properties; and

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ease of travel to resorts (including direct flights by major airlines).

We have many competitors for our club members, including other major resort destinations worldwide. We also directly compete with other destination clubs, such as Exclusive Resorts, which is the largest company in the destination club marketplace, as measured by number of club members. Our destination club members can choose from any of these alternatives.

We compete with numerous other resorts that may have greater financial resources than we do and that may be able to adapt more quickly to changes in customer requirements or devote greater resources to promotion of their offerings than we can. We believe that developing and maintaining a competitive advantage will require continued investment in our technology platform, brand, existing destination club properties and the acquisition of additional luxury properties to our portfolio of destination club properties. WeThere ~~cannot~~can ~~assure~~be ~~that~~no assurance that we will have sufficient resources to make the necessary investments to do so, ~~and we~~or ~~cannot assure~~ that we will be able to compete successfully in this market or against such competitors.

We are subject to the operating risks common to the luxury vacation industry which could adversely affect our business, financial condition and results of operations.

Our business is subject to numerous operating risks common to the luxury vacation industry. Some of these risks include:

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impact of war and terrorist activity (including threatened terrorist activity) and heightened travel security measures instituted in response thereto;

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travelers’ fears of exposure to contagious diseases;

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decreases in the demand for transient rooms and related lodging services, including a reduction in personal and business travel as a result of general economic conditions;

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cyclical over-building in the vacation ownership industry;

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restrictive changes in zoning and similar land use laws and regulations or in health, safety and environmental laws, rules and regulations and other governmental and regulatory action;

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changes in travel patterns;

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the costs and administrative burdens associated with compliance with applicable laws and regulations, including, among others, franchising, timeshare, privacy, licensing, labor and employment, and regulations under the Office of Foreign Assets Control and the Foreign Corrupt Practices Act;

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the availability and cost of capital to allow us to fund acquisitions of additional destination club properties, renovations and investments;

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disruptions in relationships with third parties, including marketing alliances and affiliations with luxury resort property owners;

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foreign exchange fluctuations; and

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the financial condition of the airline industry and the impact on air travel.

The matters described above could result in a decrease in the number, or lack of growth, in our destination club members and could have a material adverse effect on the luxury vacation industry, which in turn could have a material adverse effect on our business, financial condition and results of operations.

The current slowdown in the travel industry and the global economy generally will continue to impact our financial results and growth.

The present economic slowdown and the uncertainty over its breadth, depth and duration has had a negative impact on the luxury vacation industry. The ~~There~~current isdownturn ~~now general~~in ~~consensus among economists that~~ the ~~economies~~economy ofhas ~~the United States~~reduced, ~~Europe~~ and ~~much~~may ~~of the rest of the world have been~~ in ~~a recession since December~~ ~~2007. The current downturn in~~ the ~~economy~~future ~~may~~ reduce the demand for our destination club memberships and may increase club member resignations and redemptions. Accordingly, our financial results have been impacted by the economic slowdown and both our future financial results and growth could be further harmed if the recession continues for a significant period or becomes worse.

We have a history of losses, and may never achieve or sustain profitability.

Prior to the Acquisition, we incurred substantial losses, and we may continue to incur substantial losses in the future. Ultimate Escapes incurred net losses of $3.2 million, $23.2 million and $24.6 million during the nine months ended September 30, 2009 and the years ended December 31, 2008 and 2007, respectively. We have also experienced a decrease in new club membership sales and existing club member upgrades during the last six months of 2008 and all of 2009. These circumstances raise substantial doubt about our ability to continue to fund operating losses and provide necessary operating liquidity. Even if we do achieve profitability, we may be unable to sustain or increase our profitability in the future.

In order for our destination clubs to remain attractive and competitive, we have to spend money periodically to keep the properties well maintained, modernized and refurbished and to add new luxury properties periodically to our portfolio of destination club properties as we add new club members. This creates an ongoing need for cash and, to the extent we cannot fund expenditures from cash generated by operations, funds must be borrowed or otherwise obtained. We could finance future expenditures from any of the following sources:

• cash flow from operations;

• non-recourse, sale-leaseback or other financing;

• bank borrowings;

• annual dues increases or club member assessments;

• public offerings of debt or equity;

• sale of existing real estate;

• private placements of debt or equity; or

• some combination of the above.

We have a substantial amount of indebtedness, which could adversely affect our financial position.

We have a substantial amount of indebtedness. As of December 31, 2009, we had total debt of approximately $123 million, consisting of $99 million of borrowings under our senior secured credit facility and $24 million of additional debt obligations secured by destination club properties. Our senior secured credit facility is an amended and restated $110 million revolving credit facility with CapitalSource, secured by our real estate assets, which will mature on April 30, 2011, subject to extension by us for up to two one-year periods. The revolving credit facility includes financial and operational covenants that limit our ability to incur additional indebtedness and pay dividends as well as purchase or dispose of significant assets. Covenants in the revolving credit facility include obligations to maintain either a restricted cash balance of not less than six months of debt service or a debt service coverage ratio of 1.25 to 1, to maintain a leverage ratio between debt and consolidated net worth of no more than 3.5 to 1, to comply with specified ratios of number of club properties to club members, to have a net loss of no more than $10 million in fiscal 2009 and $5 million in fiscal 2010, and to have net income in each year thereafter, and to maintain a consolidated debt ratio of no more than 80%. Although we believe that we are in compliance with all of the covenants in the revolving credit facility, we have previously violated certain covenants contained in our prior revolving credit facility with CapitalSource. In addition, we have approximately $24 million in additional indebtedness secured by real estate assets with various first and second mortgage lenders. In the event we default on our secured debt obligations, the lenders could enforce their rights under the loan agreements, which would impair our ability to conduct our business and have a material adverse effect on our business, financial condition and results of operations. If we are unable to make payments on one or more mortgages on the properties or otherwise default on our debt obligations, the lenders could foreclose on such properties, which would have a material adverse effect on our business, financial condition and results of operations. We may also incur significant additional indebtedness in the future. Our substantial indebtedness may:

• make it difficult for us to satisfy our financial obligations, including making scheduled principal and interest payments on our indebtedness;

• limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions or other general business purposes;

• limit our ability to use our cash flow or obtain additional financing for future working capital, capital expenditures, acquisitions or other general business purposes;

• require us to use a substantial portion of our cash flow from operations to make debt service payments;

• limit our flexibility to plan for, or react to, changes in our business and industry;

• place us at a competitive disadvantage compared to less leveraged competitors; and

• increase our vulnerability to the impact of adverse economic and industry conditions.

We may not be able to generate sufficient cash to service our debt obligations.

We are subject to the risks that generally relate to real estate investments, which may have a material adverse effect on our business, financial condition and results of operations.

We are subject to the risks that generally relate to investments in real property because we own most of our destination club properties. The investment returns available from equity investments in real estate depend in large part on the amount of income earned and capital appreciation generated by the related properties, and the expenses incurred. In addition, a variety of other factors affect income from properties and real estate values, including governmental regulations, insurance, zoning, tax and eminent domain laws, interest rate levels and the availability of financing. When interest rates increase, the cost of acquiring, developing, expanding or renovating real property increases and real property values may decrease as the number of potential buyers decreases. Similarly, as financing becomes less available, it becomes more difficult both to acquire and to sell real property. ~~Finally~~In addition, our loan facility restricts our ability to sell our assets, including our real estate holdings. Finally, under eminent domain laws, governments can take real property. Sometimes this taking is for less compensation than the owner believes the property is worth. Any of these factors could have a material adverse impact on our results of operations or financial condition. In addition, equity real estate investments are difficult to sell quickly and we may not be able to adjust our portfolio of owned properties quickly in response to economic or other conditions. If our properties do not generate revenue sufficient to meet operating expenses, including debt service and capital expenditures, our income and financial condition will be adversely affected. The real estate investment industry is susceptible to trends in the national and/or regional economies and there can be no assurance that we can operate our destination club properties and then later sell any or all of them at a profit.

The need for ongoing property renovations could adversely affect our business, financial condition and results of operations.

Our properties require routine maintenance as well as periodic renovations and capital improvements. Ongoing renovations at a particular property may negatively impact the desirability of the property as a vacation destination. A significant decrease in the supply of available vacation rental accommodations and the need for vacation rental services during renovation periods, coupled with the inability to attract vacationers to properties undergoing renovations, could have a material adverse effect on our business, financial condition and results of operations.

Environmental liabilities, including claims with respect to mold or hazardous or toxic substances, could have a negative impact on our reputation and cause us to incur additional expense to remedy any such liability or claim.

Under various federal, state, local and foreign environmental laws, ordinances and regulations, a current or previous property owner of real property may be liable for the costs of removal or remediation of hazardous or toxic substances, including mold, on, under or in such property. These laws could impose liability without regard to whether we knew of, or were responsible for, the presence of hazardous or toxic substances. The presence of hazardous or toxic substances, or the failure to properly clean up such substances when present, could jeopardize our ability to develop, use, sell or rent the real property or to borrow using the real property as collateral. If we arrange for the disposal or treatment of hazardous or toxic wastes, we could be liable for the costs of removing or cleaning up wastes at the disposal or treatment facility, even if we never owned or operated that facility. Other laws, ordinances and regulations could require us to manage, abate or remove lead or asbestos containing materials. Similarly, the operation and closure of storage tanks are often regulated by federal, state, local and foreign laws. Certain laws, ordinances and regulations, particularly those governing the management or preservation of wetlands, coastal zones and threatened or endangered species, could limit our ability to develop, use, sell or rent our real property.

We cannot provide any assurances that environmental issues will not exist with respect to any destination club property we own or acquire. Even if environmental inspections are made, environmental issues may later be determined to exist because the inspections were not complete or accurate or environmental releases migrate to the properties from adjacent property. In addition to liability for environmental issues which can substantially adversely impact our business and financial condition, the marketability of the destination club properties for sale or refinancing can be adversely affected because of the concerns of a third party who may buy or lend money on the properties over the possible environmental liability and/or environmental clean-up costs. In addition, our reputation may be damaged by any alleged claim or incurrence of environmental liabilities, which could reduce demand for our destination club memberships and have a material adverse effect on our business.

We own properties that are located internationally and thus are subject to special political and monetary risks not generally applicable to our domestic properties.

We operate properties located abroad which, as of December 31, 2009, included 44 properties in 12 international locations,. ~~and~~We we intend to expand our portfolio of of international destination club properties. Properties abroad generally are subject to various political, geopolitical, and other risks that are not present or are different in the United States. These risks include the risk of war, terrorism, civil unrest, expropriation and nationalization asand regulation, as well as the impact in cases in which there are inconsistencies between U.S. law and the laws of an international jurisdiction. In addition, sales in international jurisdictions typically are made in local currencies, which subject us to risks associated with currency fluctuations. Currency devaluations and unfavorable changes in international monetary and tax policies could have a material adverse effect on our profitability and financing plans, as could other changes in the international regulatory climate and international economic conditions, in the event that we increase our operation of properties abroad.

We have a limited operating history, which may make it difficult to predict our future performance.

We have been operating only since 2004 and therefore do not have an established operating history. In addition, the acquisition of certain assets and liabilities of Private Escapes was consummated on September 15, 2009, and as a result we now have a much larger base of club members, club properties and employees to manage and operate. Consequently, any predictions you make about our future success or viability may not be as accurate as they could be if we had a longer operating history.

We may experience financial and operational risks in connection with acquisitions. In addition, businesses acquired by us may incur significant losses from operations or experience impairment of carrying value.

We ~~completed~~ completed our acquisition of certain assets and liabilities of Private Escapes on September 15, 2009, and intend to selectively pursue other acquisitions. However, we may be unable to identify attractive acquisition candidates or complete transactions on favorable terms. In addition, in the case of acquired assets or businesses, we may need to:

• successfully integrate the operations, as well as the accounting, financial and disclosure controls, management information, technology, human resources and other administrative systems, of acquired businesses with existing operations and systems;

•

maintain third party relationships previously established by acquired companies;

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retain senior management and other key personnel at acquired businesses; and

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successfully manage acquisition-related strain on our and/or the acquired businesses’ management, operations and financial resources.

We may not be successful in addressing these challenges or any others encountered in connection with historical and future acquisitions. In addition, the anticipated benefits of one or more acquisitions may not be realized and future acquisitions could result in potentially dilutive issuances of equity securities and/or the assumption of contingent liabilities. Also, the value of goodwill and other intangible assets acquired could be impacted by one or more unfavorable events or trends, which could result in impairment charges. The occurrence of any of these events could adversely affect our business, financial condition and results of operations.

We may not be able to achieve our growth objectives.

We may not be able to achieve our objectives for maintaining our existing club members, increasing our number of new club members through organic growth, acquisitions and acquiring additional luxury properties to add to our portfolio of destination club properties. Our ability to complete acquisitions of additional properties depends on a variety of factors, including our ability to obtain financing on acceptable terms and requisite lender and government approvals. Even if we are able to complete acquisitions of additional luxury properties, we may not be able to grow our club membership base or effectively integrate such acquisitions.

Extensive laws and government regulations could affect the way we conduct our business plan.

Our business exists in a regulatory environment that is changing and evolving and where certain regulatory matters are currently uncertain. Such matters include, but are not limited to, the question of whether our destination club memberships constitute timeshare/vacation ownership plans or timeshare use plans, as well as whether such club memberships being offered may constitute the offering of unregistered securities under the US federal and/or state securities laws. We believe that our club membership sales do not constitute timeshare/vacation ownership plans or timeshare use plans, nor do they constitute offers of securities under any federal or state laws or regulations. If, however, the club membership sales were determined to constitute timeshare/vacation ownership plans or timeshare use plans, or be deemed to be securities under any state or federal law, we would be required to comply with applicable state timeshare regulations or state and federal securities laws, including those laws pertaining to registration or qualification of securities, licensing of salespeople and other matters. If we cannot comply with the applicable timeshare regulations or state and federal securities requirements, in that event, and/or the determination may create liabilities or contingencies, including rescission rights relating to the club memberships we previously sold, as well as fines and penalties that could adversely affect our business, financial condition ~~and~~ and results of operations.

If we are unable to obtain the necessary permits and approvals in connection with our acquisition of destination club properties, it may have a material adverse effect on our business.

We intend to continue to acquire additional destination club properties for our portfolio. To successfully acquire and operate the properties as intended, we and/or our subsidiaries must apply for and receive any necessary federal, state and/or local and foreign permits and licenses as may be applicable to the properties. We expect to receive such necessary permits and approvals; however, there can be no assurance that such permits and approvals will be obtained. Failure to receive the necessary permits and approvals could prohibit or substantially and adversely impact our operations.

Increased insurance risk, perceived risk of travel and adverse changes in economic conditions as a result of recent events could significantly reduce our cash flow, revenues and earnings.

We believe that insurance and surety companies are re-examining many aspects of their business, and may take actions including increasing premiums, requiring higher self-insured retentions and deductibles, requiring additional collateral on surety bonds, reducing limits, restricting coverages, imposing exclusions, such as mold damage, sabotage and terrorism, and refusing to underwrite certain risks and classes of business. Any increased premiums, mandated exclusions, change in limits, coverages, terms and conditions or reductions in the amounts of bonding capacity available may adversely affect our ability to obtain appropriate insurance coverages at reasonable costs, which could significantly reduce our business cash flow, revenues and earnings.

The illiquidity of real estate investments could significantly limit our ability to respond to adverse changes in the performance of our properties and significantly reduce our cash flow, revenues and earnings.

Because real estate investments are relatively illiquid, our ability to promptly sell one or more of our properties in response to changing economic, financial and investment conditions is limited. We cannot predict whether we will be able to sell any property for the price or on the terms set by us, or whether any price or other terms offered by a prospective purchaser would be acceptable to us. We also cannot predict the length of time needed to find a willing purchaser and to close the sale of a property.

We may be required to expend funds to correct defects or to make improvements before a property can be sold. We may not have funds available to correct those defects or to make those improvements and as a result our ability to sell the property would be limited. In acquiring a property, we may agree to lock-out provisions that materially restrict us from selling that property for a period of time or impose other restrictions on us. These factors and any others that would impede our ability to respond to adverse changes in the performance of our properties could significantly reduce our cash flow, revenues and earnings.

We are subject to litigation in the ordinary course of business which could be costly and time consuming.

We are, from time to time, subject to various legal proceedings and claims, either asserted or unasserted. Any such claims, whether with or without merit, could be time-consuming and expensive to defend and could divert management’s attention and resources. Although our management believes that we have adequate insurance coverage and accrues loss contingencies for all known matters that are probable and can be reasonably estimated, we cannot assure that the outcome of all current or future litigation will not be costly and time consuming and otherwise divert management’s attention away from operating the business.

Fluctuations in real estate values may require us to write down the book value of real estate assets.

Under United States generally accepted accounting principles, we are required to assess the impairment of our long-lived assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors management considers that could trigger an impairment review include significant underperformance relative to minimum future operating results, significant change in the manner of use of the assets, significant technological or industry changes, or changes in the strategy for our overall business. When we determine that the carrying value of certain long-lived assets is impaired, an impairment loss equal to the excess of the carrying value of the asset, or asset group, over its estimated fair value is recognized. These impairment charges would be recorded as operating losses. Any material write-downs of assets could have a ~~material~~ material adverse effect on our financial condition and earnings.

We will incur increased costs as a result of being a public company.

As a public company, we ~~will~~ incur significant legal, accounting and other expenses ~~that~~ that we did not incur as a private company. The U.S. Sarbanes-Oxley Act of 2002 ~~and~~ and related rules of the SEC and stock exchanges regulate corporate governance practices of public companies. We expect that compliance with these public company requirements will increase costs and make some activities more time-consuming. For example, we have created new board committees and adopted new internal controls and disclosure controls and procedures. In addition, we incur additional expenses associated with our SEC reporting requirements. A number of those requirements require us to carry out activities we have not done previously. For example, under Section 404 of the Sarbanes-Oxley Act, our management will need to assess and report on our internal control over financial reporting and our independent accountants ~~will~~may need to issue an opinion on that assessment and the effectiveness of those controls. Furthermore, if we identify any issues in complying with those requirements (for example, if we or our independent accountants identified a material weakness or significant deficiency in our internal control over financial reporting), we could incur additional costs rectifying those issues, and the existence of those issues could adversely affect us, our reputation or investor perceptions of us.

We also expect that it will be difficult and expensive to obtain and maintain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors or as executive officers. Advocacy efforts by stockholders and third parties may also prompt even more changes in governance and reporting requirements. We cannot predict or estimate the amount of additional costs we may incur or the timing of such costs.

We depend on key personnel for the future success of our business and the loss of one or more of our key personnel could have an adverse effect on our ability to manage our business and implement our growth strategies, or could be negatively perceived in the capital markets.

Our future success and ability to manage future growth depends, in large part, upon the efforts and continued service of our senior management team, which has substantial experience in the resort and hospitality industry. Our President and Chief Executive Officer, James Tousignant, our Chairman, Richard Keith, and our Chief Financial Officer, Philip Callaghan, have been actively involved in the acquisition, ownership and ~~ownership~~operation of resort properties and are actively engaged in our management. Messrs. Tousignant, Keith and Callaghan substantially determine our strategic direction, especially with regard to operational, financing, acquisition and disposition activity. The departure of any of them ~~could~~ could negatively impact our ability to grow and manage our operations.

Although we are party to employment agreements with some of our key personnel, these employment agreements do not require them to remain our employees and, therefore, they could terminate their employment with us at any time without penalty. We do not currently maintain key man life insurance on any of our executives, and such insurance, if obtained in the future, may not be sufficient to cover the costs of recruiting and hiring a replacement or the loss of an executive’s services.

It could be difficult for us to find replacements for such key personnel, as competition for such personnel is intense. The loss of services of one or more members of senior management could have an adverse effect on our ability to manage our business and implement our growth strategies. Further, such a loss could be negatively perceived in the capital markets, which could reduce the market value of our securities.

Damage to our destination club properties and other operational risks may disrupt our business and adversely impact our financial results.

Depending on the location of our destination club properties, a particular property may bear an increased risk for damage by inclement weather, construction defects, environmental matters, acts of terrorism, or other forces or acts, whether intentional or unintentional. In addition, we rely heavily on our information systems and other data processing systems. Any such damage to properties or disruption in information systems could cause us to suffer financial loss, a disruption of our businesses, regulatory intervention or reputational damage.

Furthermore, we depend on our headquarters in Kissimmee, Florida, where most of our information systems and personnel are located, for the continued operation of our business. A natural disaster or other catastrophic event or disruption in the infrastructure that supports our businesses, including a disruption involving electronic communications or other services used by us or third parties with whom we conduct business, or directly affecting our headquarters, could have a material adverse impact on our ability to continue to operate our business without interruption. The impact of any disaster or disruption on our business will likely be exacerbated by the fact that we do not have any disaster recovery program in place to mitigate the harm or minimize the lost data that may result from such a disaster or disruption. In addition, insurance and other safeguards might only partially reimburse us for our losses, if at all.

We are vulnerable to the risk of unfavorable weather conditions and continued inclement weather could reduce our revenues and earnings.

Our ability to attract visitors to our resorts is influenced by weather conditions. Unfavorable weather conditions can adversely affect visits and our revenues and profits. Adverse weather conditions may discourage visitors from participating in outdoor activities at our resorts. There is no way for us to predict future weather patterns or the impact that weather patterns may have on results of operations or visitation. Extreme weather conditions such as hurricanes or prolonged periods of adverse weather conditions, or the occurrence of such conditions during peak visitation periods, could have a material adverse effect on our financial condition and results of operations by reducing revenues and earnings.

Our property development and management operations are conducted in many areas that are subject to natural disasters and severe weather, such as hurricanes and floods. We also may be affected by unforeseen engineering, environmental, or geological problems. These conditions could delay or increase the cost of construction projects, damage or reduce the availability of materials, and negatively impact the demand for resorts in affected areas. If insurance does not fully cover business interruptions or losses resulting from these events, our earnings, liquidity and capital resources could be adversely affected.

Our success depends, in part, on the integrity of our systems and infrastructure. System interruptions may have an adverse impact on our business, financial condition and results of operations.

Our success depends, in part, on our ability to maintain the integrity of our systems and infrastructure, including websites, information and related systems and call centers. System interruptions may adversely affect our ability to operate websites, process and fulfill club member reservations and other transactions, respond to customer inquiries and generally maintain cost-efficient operations. We may experience occasional system interruptions that make some or all systems or data unavailable or prevent us from efficiently providing services. We also rely on third-party computer systems, broadband and other communications systems and service providers in connection with the provision of services generally, as well as to facilitate, process and fulfill transactions. Any interruptions, outages or delays in these systems, or deterioration in the performance of these systems and infrastructure, could impair our ability to provide services. Fire, flood, power loss, telecommunications failure, hurricanes, tornadoes, earthquakes, acts of war or terrorism, acts of God and similar events or disruptions may damage or interrupt computer, broadband or other communications systems and infrastructure at any time. Any of these events could cause system interruption, delays and loss of critical data, and could prevent us from providing services. Although we have backup systems for certain aspects of our operations, these systems are not fully redundant and disaster recovery planning is not sufficient for all eventualities. In addition, we may not have adequate insurance coverage to compensate for losses from a major interruption. If any of these adverse events were to occur, it could adversely affect our business, financial condition and results of operations.

In addition, any penetration of network security or other misappropriation or misuse of personal consumer information could cause interruptions in our operations and subject us to increased costs, litigation and other liabilities. Claims could also be made against us for other misuse of personal information, such as for unauthorized purposes or identity theft, which could result in litigation and financial liabilities, as well as administrative action from governmental authorities. Security breaches could also significantly damage our reputation with consumers and third parties with whom we do business. It is possible that advances in computer capabilities, new discoveries, undetected fraud, inadvertent violations of company policies or procedures or other developments could result in a compromise of information or a breach of the technology and security processes that are used to protect consumer transaction data. As a result, current security measures may not prevent any or all security breaches. We may be required to expend significant capital and other resources to protect against and remedy any potential or existing security breaches and their consequences. Consumers are generally concerned with security and privacy of the Internet, and any publicized security problems affecting us may discourage consumers from doing business with us, which could have an adverse effect on our business, financial condition and results of operations.

Our success depends on the value of our name, image and brand, and if demand for our destination club properties and their features decreases or the value of our name, image or brand diminishes, our business, revenues and results of operations would be reduced.

Our success depends, to a large extent, on our ability to shape and stimulate consumer tastes and demands by producing and maintaining luxurious, attractive, and exciting properties and services, as well as our ability to remain competitive in the areas of design and quality. There can be no assurance that we will be successful in this regard or that we will be able to anticipate and react to changing consumer tastes and demands in a timely manner.

Furthermore, a high media profile is an integral part of our ability to shape and stimulate demand for our destination club memberships with our target customers. A key aspect of our marketing strategy is to focus on attracting media coverage. If we fail to attract that media coverage, we may need to substantially increase our advertising and marketing costs, which would decrease our earnings. In addition, other types of marketing tools, such as traditional advertising and marketing, may not be successful in attracting target customers.

Our business would be adversely affected if our public image or reputation were to be diminished. Our brand names and trademarks are integral to our marketing efforts. If the value of our name, image or brands were diminished, our business, revenues and results of operations would be reduced.

Any failure to protect our trademarks could have a negative impact on the value of our brand names and reduce our business and reduce revenues.

We believe our trademarks are critical to our success. We rely on trademark laws to protect our proprietary rights. The success of our business depends in part upon our continued ability to use our trademarks to increase brand awareness and further develop our brand. Monitoring the unauthorized use of our intellectual property is difficult. Litigation may be necessary to enforce our intellectual property rights or to determine the validity and scope of the proprietary rights of others. Litigation of this type could result in substantial costs and diversion of resources, may result in counterclaims or other claims against us and could significantly harm our results of operations. In addition, the laws of some foreign countries do not protect our proprietary rights to the same extent as do the laws of the United States. From time to time, we apply to have certain trademarks registered. There is no guarantee that such trademark registrations will be granted. We cannot assure that all of the steps we have taken to protect our trademarks will be adequate to prevent imitation of our trademarks by others. The unauthorized reproduction of our trademarks could diminish the value of our brand and our market acceptance, competitive advantages or goodwill, which could reduce our business and reduce revenues.

Changes in weather patterns as a result of global warming could have an adverse effect on our business.

Scientific reports indicate that, as a result of human activity:

•

temperatures around the world have been increasing and are likely to continue to increase as a result of increasing atmospheric concentrations of carbon dioxide and other carbon compounds;

•

the frequency and severity of storms, and flooding, are likely to increase;

•

severe weather is likely to occur in places where the climate has historically been more mild; and

•

average sea levels have risen and are likely to rise more, threatening worldwide coastal development.

We cannot predict the effects that these phenomena may have on our business. We could be impacted to the extent that global warming trends affect established weather patterns or exacerbate extreme weather or weather fluctuations, hindering or preventing travel by our club members in certain circumstances. They might also affect the desirability of some of our properties, such as ones located on beaches or in skiing areas, increase the cost and reduce the availability of insurance covering damage from natural disasters for some of our properties and lead to new laws and regulations that increase our expenses and reduce our revenues. Any of these consequences, and other consequences of global warming that we do not foresee, could materially and adversely affect our sales, profits and financial condition.

Risks Related to Our Common Stock

WeIt ~~are~~may ~~currently~~be ~~not~~difficult infor ~~compliance~~you ~~with~~to ~~the~~resell ~~minimum~~shares ~~listing requirements~~ of ~~the NYSE Amex’s Company Guide, and the NYSE Amex has notified us that it intends to file a delisting application with respect to~~ our ~~securities. Delisting~~ ~~would~~common ~~limit~~stock ~~investors’~~if ~~ability~~an ~~to make~~active ~~transactions~~market infor our ~~securities~~common ~~and~~stock ~~subject~~does usnot ~~to additional trading restrictions~~develop.

~~Our common~~As ~~stock and warrants are listed on the NYSE Amex,~~ a ~~national securities~~ ~~exchange. On~~result ~~December~~of ~~7, 2009, we received notification from~~ the ~~NYSE Amex that it intends to file a~~ delisting ~~application~~of ~~with the SEC to remove~~ our securities from ~~listing and registration on~~ the NYSE Amex, ~~due~~in toFebruary ~~our failure to satisfy one or more of the NYSE Amex continued listing standards. Specifically~~2010, ~~the NYSE Amex noted that as of the closing~~ ofour ~~the Acquisition, we failed to satisfy the NYSE Amex’s original listing standards and minimum distribution standards, which require a minimum public distribution of 500,000 shares of~~ common stock ~~together~~is ~~with~~not aactively ~~minimum~~traded ~~800 public~~on ~~shareholders or~~ a ~~minimum~~securities ~~public~~exchange ~~distribution~~and ~~of 1,000,000 shares of~~we ~~common~~currently ~~stock~~do ~~together~~not ~~with~~meet athe ~~minimum~~initial ~~of 400 public shareholders. The~~ listing ~~standards~~criteria ~~applicable~~for toany usregistered ~~also require a minimum market capitalization~~securities ~~of $75 million, or a minimum of $4 million of stockholders’ equity~~exchange. As ofOur ~~January~~securities ~~11,~~are ~~2010,~~currently wequoted ~~had~~on ~~2,486,495~~the ~~outstanding shares, 195 record holders and approximately 325 beneficial holders. On a pro~~Over-~~forma basis, treating as issued~~ the-Counter ~~7,556,675 shares issuable upon~~Bulletin ~~conversion~~Board. ofThis ~~outstanding~~factor ~~ownership~~may ~~units~~impair inour ~~Ultimate~~stockholders' ~~Escapes~~ability ~~Holdings and assuming the distribution of the underlying shares by Ultimate Escapes Holdings~~ to sell their ~~respective owners, we had approximately 10 million outstanding~~ shares, ~~approximately~~when ~~440~~they ~~public~~want ~~shareholders~~ and/or acould ~~market~~depress ~~capitalization~~our ~~of approximately~~stock ~~$37~~price.2 ~~million.~~ As ~~of September 30, 2009, our stockholders equity, on~~ a ~~pro-forma basis~~result, ~~was approximately $(29.4) million. We~~stockholders ~~have~~may ~~submitted~~find anit ~~appeal~~difficult ~~letter~~ to ~~the~~dispose ~~NYSE~~of, ~~Amex~~or ~~Qualifications Panel outlining our plan~~ to ~~remain~~obtain inaccurate ~~compliance~~quotations ~~with~~of the price ~~listing requirements~~of, ~~and~~our wesecurities ~~have requested~~because asmaller ~~hearing~~quantities ~~before~~of ashares ~~NYSE~~could ~~Amex~~be ~~Qualifications Panel to appeal the~~bought ~~foregoing~~and ~~delisting determination by the NYSE Amex staff; however~~sold, ~~there~~transactions ~~can~~could be no ~~assurance~~delayed ~~that~~and ~~our~~security ~~plan~~analyst toand ~~remain~~news ~~in compliance with the NYSE Amex listing~~coverage ~~requirements~~of ~~will be achieved or that~~ our ~~request~~company ~~for~~may ~~continued listing will~~ be ~~granted~~ limited. If ~~the~~These ~~NYSE~~factors ~~Amex~~could ~~delists~~result ~~our~~in ~~securities~~lower ~~from~~prices ~~quotation on~~and ~~its~~larger ~~exchange,~~spreads ~~this~~in ~~would~~the ~~limit~~bid ~~investors’~~and ~~ability~~ask toprices ~~make~~for ~~transactions in~~ our ~~securities~~ shares.

The concentration of our capital stock ownership with insiders will likely limit your ability to influence corporate matters.

As of April ~~January 11~~30, 2010, our executive officers, directors and affiliated entities together beneficially ~~own~~owned over 7069% of our outstanding common stock and we anticipate that these stockholders will together beneficially own approximately 7% of our common stock outstanding after this offering (in each case after giving effect to the exchange of all ownership units of Ultimate Escapes Holdings held by them into shares of our common stock, excluding any earn-out units that may be issued). In addition, James M. Tousignant, our President and Chief Executive Officer and a member of our board of directors, holds, as representative on behalf of the other owners of Ultimate Escapes Holdings, 7,556,675 shares of our Series A Preferred Voting Stock, which vote as a single class with shares of our common stock on all matters. As a result, Mr. Tousignant has control over most matters that require approval by ~~our~~ our stockholders, including the election of directors and approval of ~~significant~~ significant corporate transactions. Corporate action might be taken even if ~~other~~ other stockholders, including those who purchase shares in this offering, oppose them. This concentration of ownership might also have the effect of delaying or preventing a change ofin control of our company that other stockholders may view as beneficial.

Our management will have broad discretion over the use of the proceeds we receive in this offering and might not apply the proceeds in ways that increase the value of your investment.

Our management will have broad discretion to use the net proceeds from this offering, and you will be relying on the judgment of our management regarding the application of these proceeds. We may not apply the net proceeds of this offering in ways that increase the value of your investment. We expect to use the net proceeds from this offering for reduction of indebtedness and other general corporate purposes, including working capital and capital expenditures, and for possible investments in, or acquisitions of, properties and/or complementary businesses. We have not allocated these net proceeds for any specific purposes. Our management might not be able to yield a significant return, if any, on any investment of these net proceeds. You will not have the opportunity to influence our decisions on how to use the proceeds.

We may issue additional shares of our common stock, which would increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders. This might have an adverse effect on the market price of our common stock.

Outstanding warrants to purchase an aggregate of 12,075,000 shares of common stock are currently exercisable. These warrants would only be exercised if the $8.80 per share exercise price is below the market price of our common stock. To the extent they are exercised, additional shares of our common stock will be issued, which will result in dilution to our stockholders and increase the number of shares eligible for resale in the public market.

In addition, if ~~Ultimate Escapes~~we ~~Holdings~~achieve ~~achieves~~ certain Adjusted EBITDA targets in each of 2010, 2011 and/or 2012, we will be required to issue up to 7,000,000 additional shares of common stock to certain of Ultimate Escapes Holdings’ owners upon conversion of ~~additional~~ additional ownership units issued if such targets are met. See “Certain Relationships and Related Transactions and Director Independence — Operating Agreement of Ultimate Escapes Holdings” for additional information. Any such issuances would dilute the percentage ownership by our current stockholders and reduce their influence on our management. ~~These~~ These issuances may also result in a decrease in the trading price of our common stock.

Future sales of our common stock may cause the market price of our securities to drop significantly, even if our business is doing well.

In accordance with lock-up obligations contained in the amended and restated operating agreement of Ultimate Escapes Holdings entered into in connection with the consummation of the ~~Acquisition~~reverse merger (the “Operating Agreement”), the other owners of Ultimate Escapes Holdings (the “UE Owners”) will be able to sell their shares of our common stock they are entitled to receive upon conversion of their ownership units in connection with the ~~Acquisition~~reverse merger beginning on the first anniversary of the ~~consummation~~ of the Acquisition. In accordance with SEC regulations, the founders, officers and directors of our company will not be able to sell any common stock they receive in exchange for their founders shares until the first anniversary of the consummation of the ~~Acquisition,~~reverse ~~subject to certain exceptions~~merger. Pursuant to the registration rights agreement entered into in connection with the consummation of the ~~Acquisition,~~reverse ~~the owners of Ultimate Escapes Holdings prior to the Acquisition consisting of Ultimate Resort~~merger, ~~Private Escapes and JDI Ultimate, L.L.C. (~~the “UE Owners~~”),~~ have registration rights, subject to certain limitations, with respect to shares of our common stock for which their ownership units of Ultimate Escapes Holdings may be exchanged. We have agreed to file, as soon as possible after the closing date of the ~~Acquisition~~ reverse merger but in no event later than ~~eight~~June ~~months~~29, ~~from the closing date~~2010, ~~to file~~ a registration statement covering the shares of our common stock for which their ownership units of Ultimate Escapes Holdings may be exchanged. The UE Owners also have certain “piggyback” registration rights applicable to some registration statements filed by us following the consummation of the ~~Acquisition~~ reverse merger. In addition, pursuant to a registration rights agreement between us and our initial stockholders, our initial stockholders or their permitted transferees will be entitled to rights to demand ~~two times~~ that we register the resale of the founder shares ~~and the sponsor warrants (and shares underlying the sponsor warrants)~~ at any time, in addition to certain “piggyback” registration rights applicable to registration statements filed by us, generally commencing one year after the consummation of the ~~Acquisition~~reverse merger as to the founder shares ~~and three months after the consummation of the Acquisition as to the sponsor warrants (and shares underlying the sponsor warrants)~~. The presence of these additional securities trading in the public market may have an adverse effect on the market price of our securities. The sale by any of the foregoing, or entities they control or their permitted transferees, could cause the market price of our securities to decline.

Our ability to request indemnification from the UE Owners for damages arising out of the ~~Acquisition~~reverse merger is limited to those claims where damages exceed $600,000 and is is also limited to the shares of common stock issued in the ~~Acquisition~~reverse ~~that~~merger ~~are~~that are held in escrow or may be set-off against earn-out payments.

To provide a fund to secure the indemnification obligations of Ultimate Escapes Holdings to us against losses that we may sustain as a result of (i) the inaccuracy or breach of any representation or warranty made by Ultimate Escapes Holdings or any UE Owner in the Contribution Agreement or any schedule or certificate delivered by it or the UE Owners in connection with the Contribution Agreement and (ii) the non-fulfillment or breach of any covenant or agreement made by Ultimate Escapes Holdings in the Contribution Agreement, the UE Owners placed in escrow an aggregate of 717,884 ownership units of Ultimate Escapes Holdings, or 10% of the aggregate number of ownership units owned by the UE Owners immediately prior to the ~~Acquisition~~reverse merger. With respect to claims based ~~upon~~ upon certain representations and warrants deemed “Fundamental Representations” by the parties or fraud or intentional misconduct, those claims are not limited to the escrowed units but are subject to a cap of 25% of the aggregate number of ownership units owned by the UE Owners immediately prior to the ~~Acquisition~~reverse merger, which amount in excess of the escrowed units may be satisfied by us setting off such claims against payments due to the UE Owners for any future earn-out payments. Claims for indemnification may be asserted against the escrow by us once our damages exceed a $600,000 deductible and will be reimbursable, by cancellation of such units or set-off against future earn-out payments, as applicable, to the full extent of the damages in excess of such amount. Claims for indemnification may be asserted until the later of fifteen days after the date on which we file our Annual Report on Form 10-K for the year ending December 31, 2010 or April 15, 2011, with respect to certain claims; up to the applicable statute of limitations with respect to claims based upon the breach of certain designated representations and warranties; and up to the sixth anniversary of the closing date of the Contribution Agreement with respect to claims based upon the breach of “Fundamental Representations” by the parties or fraud or intentional or willful misrepresentation or omission. As a consequence of these limitations, we may not be able to be entirely compensated for indemnifiable damages that we may sustain.

Public stockholders at the time of the ~~Acquisition~~reverse merger who purchased units in our ~~initial~~ initial public offering and did not exercise their conversion rights may have ~~rescission~~ rescission rights and related claims.

There were several aspects of the ~~Acquisition~~reverse merger and the other matters which were not described in the prospectus issued by us in connection with our initial public offering. These include: that we may consummate a business combination outside of the homeland security industry; that we may seek to amend the definition of “business combination” in our certificate of incorporation; that we may seek to amend our amended and restated certificate of incorporation to provide conversion rights to holders of ~~Public~~public ~~Shares~~shares, regardless of whether such holder votes for or against the business combination; that the funds in the trust account might be used to purchase shares from our stockholders who have indicated their intention to vote against the ~~Acquisition~~reverse merger and convert their shares into cash; and that we may seek to amend the terms of the warrant agreement between ~~the Company~~us, ~~its~~our warrant agent and ~~warrantholders~~warrant holders (the “Warrant Agreement”), to revise the exercise price and the expiration date. Consequently, our consummation of a business combination with Ultimate Escapes Holdings (which does not operate in the homeland security industry), our filing of certain charter amendments in connection with the ~~Acquisition~~reverse merger, our use of funds in the trust account to purchase shares of stockholders who had indicated their intention to vote against the ~~Acquisition~~reverse merger or our amendment of the Warrant Agreement might be grounds for a stockholder who purchased shares in the initial public offering, excluding our founders, and still held them at the time of the ~~Acquisition~~ reverse merger without seeking to convert them into cash, to seek rescission of the purchase of the units he acquired in the initial public offering. A successful claimant for damages under federal or state law could be awarded an amount to compensate for the decrease in value of his or her shares caused by the alleged violation (including, possibly, punitive damages), together with interest, while retaining the shares. If we are required to pay damages, our results of operations could be adversely affected.

If the Acquisition’s benefits do not meet the expectations of financial or industry analysts, the market price of our securities may decline.

The market price of our securities may decline if:

• we do not achieve the perceived benefits of the Acquisition as rapidly, or to the extent anticipated by, financial or industry analysts; or

• the effect of the Acquisition on our financial results is not consistent with the expectations of financial or industry analysts.

If the reverse merger’s benefits do not meet the expectations of financial or industry analysts, the market price of our securities may decline.

The market price of our securities may decline if:

•

we do not achieve the perceived benefits of the reverse merger as rapidly, or to the extent anticipated by, financial or industry analysts; or

•

the effect of the reverse merger on our financial results is not consistent with the expectations of financial or industry analysts.

Accordingly, investors may experience a loss as a result of a decline in the market price of our securities. A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.

Volatility of our stock price could adversely affect stockholders.

The market price of our common stock could also fluctuate significantly as a result of:

•

quarterly variations in our operating results;

•

interest rate changes;

•

changes in the market’s expectations about our operating results;

•

our operating results failing to meet the expectation of securities analysts or investors in a particular period;

•

changes in financial estimates and recommendations by securities analysts concerning our company or our industry in general;

•

operating and stock price performance of other companies that investors deem comparable to us;

•

news reports relating to trends in our markets;

•

changes in laws and regulations affecting our business;

•

material announcements by us or our competitors;

•

sales of substantial amounts of common stock by our directors, executive officers or significant stockholders or the perception that such sales could occur;

•

general economic and political conditions such as recessions and acts of war or terrorism; and

•

other matters discussed in the risk factors.

Fluctuations in the price of our common stock could contribute to the loss of all or part of an investor’s investment in our company.

We currently do not intend to pay dividends on our common stock and consequently your only opportunity to achieve a return on your investment is if the price of our common stock appreciates.

We currently do not plan to declare dividends on our common stock in the foreseeable future. Any payment of cash dividends will depend upon our financial condition, capital requirements, earnings and other factors deemed relevant by our board of directors. The terms of our current indebtedness contain, and agreements governing future indebtedness will likely contain, restrictions on our ability to pay cash dividends. Consequently, your only opportunity to achieve a return on your investment in the common stock of our company will be if the market price of our common stock appreciates and you sell your common stock at a profit.

1920

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements made in this prospectus constitute forward-looking statements. Forward-looking statements include statements preceded by, followed by or that include the words “may,” “could,” “would,” “should,” “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “project,” “potential,” “intend” or similar expressions. These statements include, among others, statements regarding our expected business outlook, anticipated financial and operating results, business strategy and means to implement the strategy, the amount and timing of capital expenditures, the likelihood of our success in building our business, financing plans, budgets, working capital needs and sources of liquidity. We believe it is important to communicate our expectations to our stockholders. However, there may be events in the future that we are not able to predict accurately or over which we have no control.

Forward-looking statements, estimates and projections are based on management’s beliefs and assumptions, are not guarantees of performance and may prove to be inaccurate. Forward-looking statements also involve risks and uncertainties that could cause actual results to differ materially from those contained in any forward-looking statement and which may have a material adverse effect on our business, financial condition, results of operations and liquidity. A number of important factors could cause actual results or events to differ materially from those indicated by forward-looking statements. These risks and uncertainties include, but are not limited to, those factors listed in this prospectus under “Risk Factors. ”

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this prospectus. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual future results to differ materially from those projected or contemplated in the forward-looking statements.

All forward-looking statements included herein attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Except to the extent required by applicable laws and regulations, we undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events. You should be aware that the occurrence of the events described in the “Risk Factors” section and elsewhere in this prospectus could have a material adverse effect on us.

USE OF PROCEEDS

We will ~~estimate~~not ~~that~~receive weany proceeds from the sale of common stock covered by this prospectus. The selling stockholders will receive ~~approximately~~all ~~$ million~~of ~~in net~~the net proceeds from the ~~sale~~sales of ~~our~~ common stock inoffered by them under this prospectus. To ~~offering~~the extent that the holders exercise, orfor cash (which ~~approximately~~we ~~$ million~~expect would occur only if the ~~underwriter’s over-allotment~~market ~~option~~price isof ~~exercised~~our incommon ~~full,~~stock atwere to exceed the ~~public~~exercise ~~offering~~ price of $ 8.80 per share), ~~and~~all ~~after~~of ~~deducting~~the ~~underwriting~~warrants ~~discounts~~registered ~~and~~for ~~commissions~~resale ~~and~~under ~~estimated~~this ~~offering~~prospectus, ~~expenses~~we ~~payable~~would byreceive us$8,260,000 in the aggregate from such exercise. We intend to use such proceeds for working capital and other general corporate purposes.

We currently intend to use a portion of the net proceeds from this offering to fund possible investments in, or acquisition of, destination clubs, properties and/or other complementary businesses, and such acquisitions may also involve the issuance of unregistered and/or registered common stock of the company. We have no current agreements or commitments with respect to any material investment or acquisition. We also currently intend to use a portion of the net proceeds from this offering to repay a portion of the outstanding indebtedness under our credit facility, which accrues interest at the minimum rate of 8.75% as of December 31, 2009 and will mature on April 30, 2011. The amount outstanding under this credit facility was approximately $99 million at December 31, 2009. We currently intend to use the remaining proceeds for general corporate purposes, including working capital and capital expenditures. In addition, the amount and timing of what we actually spend for these purposes may vary significantly and will depend on a number of factors, including our future revenue and cash generated by operations and the other factors described in “Risk Factors.” Accordingly, our management will have discretion and flexibility in applying the net proceeds of this offering. Pending any uses, as described above, we intend to invest the net proceeds in high quality, investment grade, short-term fixed income instruments which include corporate, financial institution, federal agency or U.S. government obligations.

CAPITALIZATION

The following table summarizes our balance sheet data as of September 30, 2009:

· on an actual basis;

· on a pro forma basis, after giving effect to the Acquisition; and

· on a pro forma as adjusted basis to reflect the estimated net proceeds we will receive from the sale of shares of common stock offered by this prospectus at an assumed public offering price of $ per share, after deducting the underwriting discount and the estimated offering expenses we will pay.

You should read this table in conjunction with “Selected Consolidated Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and related notes included elsewhere in this prospectus.

	As of September 30, 2009 (unaudited, in thousands)
	Actual		Pro Forma			Pro Forma As Adjusted
Cash and cash equivalents	$	79,476	$	12,315
Long term debt	$	—	$	125,063		$
Preferred stock, $.0001 par value; Actual - no shares authorized, issued and outstanding; Pro Forma and Pro Forma As Adjusted - 20,000,000 shares authorized, 14,556,675 Preferred Series A authorized and 7,556,675 issued and outstanding		—		1
Common stock, $.0001 par value; Actual - 50,000,000 shares authorized, 12,500,000 shares issued and outstanding; Pro Forma - 300,000,000 shares authorized, 1,575,523 shares issued and outstanding; Pro Forma As Adjusted - 300,000,000 shares authorized, shares issued and outstanding		1		—
Additional paid-in capital		7,077		28,659
Accumulated income (deficit)		446		(58,021	)
Total stockholders’ equity (deficit)		7,524		(29,361	)
Total capitalization	$	7,524	$	95,702

The number of shares to be outstanding after this offering is based on 2,486,495 shares outstanding on January 11, 2010 and excludes the following:

• 7,556,675 shares of common stock issuable upon conversion of ownership units in Ultimate Escapes Holdings outstanding as of January 11, 2010;

• 53,427 shares of common stock issuable upon the exercise of stock options granted under our 2009 Stock Option Plan as of January 11, 2010;

• 1,137,773 shares of common stock reserved for further issuance under our 2009 Stock Option Plan as of January 11, 2010; and

• 12,075,000 shares of common stock issuable upon the exercise of all warrants outstanding as of January 11, 2010.

PRICE RANGE OF SECURITIES AND DIVIDENDS

Price Range of Our Securities

Our common stock and warrants are each listed on the ~~NYSE~~OTC ~~Amex~~bulletin ~~under~~board ~~the symbols UEI and UEI.WS, respectively. Our units were listed on the NYSE Amex~~ under the ~~symbol~~ticker ~~UEI.U~~symbols ~~until~~ULEI ~~October 30, 2009. Our units commenced public trading on October 23, 2007~~ and ~~our common stock and warrants commenced public trading on January 18~~ULEIW, ~~2008~~respectively. On December 7, 2009, we received notification from the NYSE Amex that it intends to file a delisting application with the SEC to remove our securities from listing and registration on the NYSE Amex, due to our failure to satisfy one or more of the NYSE Amex continued listing standards. Specifically, the NYSE Amex noted that as of the closing of the Acquisition, we failed to satisfy the NYSE Amex’s original listing standards and minimum distribution standards, which require a minimum public distribution of 500,000 shares of common stock together with a minimum 800 public shareholders or a minimum public distribution of 1,000,000 shares of common stock together with a minimum of 400 public shareholders. The listing standards applicable to us also require a minimum market capitalization of $75 million, or a minimum of $4 million of stockholders’ equity. As of January 11, 2010, we had 2,486,495 outstanding shares, 195 record holders and approximately 325 beneficial holders, and a market capitalization of $9.2 million. On a pro-forma basis, treating as issued the 7,556,675 shares issuable upon conversion of outstanding ownership units in Ultimate Escapes Holdings and assuming the distribution of the underlying shares by Ultimate Escapes Holdings to their respective owners, we had approximately 10 million outstanding shares, approximately 440 public shareholders and a market capitalization of approximately $37.2 million. As of September 30, 2009, our stockholders equity, on a pro-forma basis, was approximately $(29.4) million. We have requested a hearing before an NYSE Amex Qualifications Panel to appeal the foregoing delisting determination by the NYSE Amex staff; however, there can be no assurance that our request for continued listing will be granted.

~~The~~Prior ~~table~~to ~~below~~February ~~sets~~19, ~~forth~~2010, ~~for~~our ~~the~~common ~~calendar~~stock ~~quarters~~and ~~indicated,~~warrants ~~the~~were ~~high~~listed ~~and~~on ~~low~~the ~~closing~~NYSE Amex ~~sales~~under ~~prices~~the ofsymbols ~~our~~UEI ~~units~~and UEI.WS, ~~common~~respectively. ~~stock~~Our ~~and~~units ~~warrants~~were aslisted ~~reported~~ on the ~~NYSE~~ NYSE Amex ~~(without~~under ~~giving~~the ~~effect~~symbol toUEI.U ~~the~~until ~~reverse~~October ~~stock~~30, ~~split~~2009. toOur beunits ~~effected~~commenced public intrading on October 23, 2007 and our common stock and warrants commenced ~~connection~~public ~~with~~trading ~~this~~on ~~offering)~~January 18, 2008.

Quarter Ended	Units				Common				Warrants
	High		Low		High		Low		High		Low
December 31, 2007	$	8.06	$	7.83	$	N/A	$	N/A	$	N/A	$	N/A
March 31, 2008		7.95		7.41		7.30		6.67		0.68		0.28
June 30, 2008		7.72		7.40		7.49		7.18		0.32		0.25
September 30, 2008		7.70		7.46		7.60		7.35		0.26		0.10
December 31, 2008		7.28		7.00		7.32		6.99		0.13		0.02
March 31, 2009		7.65		6.58		7.85		7.35		0.15		0.02
June 30, 2009		7.80		7.45		7.90		7.32		0.06		0.01
September 30, 2009		7.93		7.80		7.91		7.75		0.15		0.04
December 31, 2009		8.52		7.93		8.25		3.70		0.40		0.06

The table below sets forth, for the calendar quarters indicated, the high and low closing sales prices of our units, common stock and warrants as reported on the NYSE Amex or the OTC bulletin board, as appropriate.

2321

On January 11, 2010, our common stock and warrants closed at $3.70 and $0.08, respectively, or $ and $ , respectively, after giving effect to the anticipated 1-for- reverse stock split to be effected prior to the effectiveness of the registration statement of which this prospectus is a part.

Quarter Ended	Units				Common				Warrants
	High		Low		High		Low		High		Low
March 31, 2008		7.95		7.41		7.30		6.67		0.68		0.28
June 30, 2008		7.72		7.40		7.49		7.18		0.32		0.25
September 30, 2008		7.70		7.46		7.60		7.35		0.26		0.10
December 31, 2008		7.28		7.00		7.32		6.99		0.13		0.02
March 31, 2009		7.65		6.58		7.85		7.35		0.15		0.02
June 30, 2009		7.80		7.45		7.90		7.32		0.06		0.01
September 30, 2009		7.93		7.80		7.91		7.75		0.15		0.04
December 31, 2009		8.52		7.93		8.25		3.70		0.40		0.06
March 31, 2010		N/A		N/A		3.70		1.85		0.13		0.02

As of June 2, 2010, our common stock and warrants closed at $1.20 and $0.01, respectively and there were 100 holders of record of our common stock and 2 holders of record of our warrants.

Dividend Policy

We have not paid any dividends on our common stock to date and do not anticipate paying any dividends in the foreseeable future. We intend to retain future earnings, if any, in the operation and expansion of our business. Any future determination to pay cash dividends will be made at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements and other factors that our board of directors deems relevant. In addition, the terms of our current indebtedness precludes us, and the terms of any future indebtedness that we may incur could preclude us, from paying dividends. Investors should not purchase our common stock with the expectation of receiving cash dividends.

2422

SELECTED CONSOLIDATED FINANCIAL DATA ~~OF ULTIMATE ESCAPES HOLDINGS~~

Because the ~~Acquisition~~business combination with Ultimate Escapes Holdings was considered a reverse acquisition and recapitalization for accounting purposes, the historical financial statements of Ultimate Escapes Holdings became our historical financial statements. On September 15, 2009, Ultimate Resort Holdings contributed all of its assets and liabilities to its wholly-owned subsidiary, Ultimate Escapes Holdings. On September 15, 2009, Private Escapes contributed a majority of its assets, liabilities, properties and other rights to Ultimate Escapes Holdings in exchange for an 8% ownership interest in Ultimate Escapes Holdings. ~~The following selected consolidated historical financial information of Ultimate Escapes Holdings as of December 31~~Accordingly, ~~2008 and 2007 and for~~ the ~~years~~operating ~~then~~results ~~ended was derived from the audited consolidated financial statements~~ of ~~Ultimate~~Private Escapes ~~Holdings included~~are included in ~~this~~our ~~prospectus. The selected~~ consolidated ~~historical~~ financial ~~information of Ultimate Escapes Holdings as of and for the nine months ended September 30, 2009 and 2008 was derived from the unaudited condensed consolidated financial~~ statements ~~of Ultimate Escapes Holdings included in this prospectus and includes the unaudited results of the acquired operations of Private Escapes~~ from September 16, ~~2009 through September 30,~~ 2009. ~~The selected financial data of Private Escapes for periods prior to September 16, 2009 is included on the next page.~~

The ~~results~~following ofselected ~~operations~~consolidated financial data for the ~~interim~~three ~~period~~months ~~are~~ended ~~not~~March 31, ~~necessarily~~2010 ~~indicative~~and of the ~~results~~years ofended ~~operations~~December ~~which~~31, ~~might~~2009, be2008, ~~expected~~and ~~for~~2007 is derived from the ~~entire~~audited consolidated financial statements of Ultimate Escapes Holdings and ~~year~~notes thereto. ~~This~~The information provided below should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and ~~the~~our financial statements ~~of Ultimate Escapes Holdings~~ and ~~Private Escapes and~~ the notes thereto included elsewhere in this prospectus.

	As of and for the Nine Months Ended September 30,						As of and for the Years Ended December 31,
				As and for the Years
	2009			2008			2008			2007
	As of and for the Three			Ended December 31,
	(unaudited)			(unaudited)
	Months Ended March 31, 2010			2009			2008			2007
	(unaudited)
	(In thousands)
Statement of Operations Data:
Revenues	$	257,~~061~~315		$	1637,~~497~~011		$	22,541		$	15,113
Operating income (loss)		(3,~~823~~714	)		(113,~~830~~411	)		(1413,~~344~~763	)		(17,853	)
Net loss		(36,~~225~~472	)		(1812,~~948~~965	)		(23,222	)		(24,645	)
Balance Sheet Data:
Total assets	$	~~216~~198,~~520~~688		$	~~N/A~~207,616		$	131,~~609~~498		$	135,822
Working capital		(1734,~~461~~372	)		~~N/A~~(32,711	)		(8,~~804~~917	)		(3,843	)
Owners’ equity		(34,579	)		N/A			(36,813	)		(15,668	)
Owners’ Equity		(29,091	)		(22,986	)		(36,927	)		(15,668	)

2523

~~SELECTED~~MANAGEMENT’S ~~COMBINED~~DISCUSSION ~~CONSOLIDATED~~AND ~~FINANCIAL~~ANALYSIS ~~DATA~~ OF FINANCIAL CONDITION

~~PRIVATE~~AND ~~ESCAPES~~RESULTS OF OPERATIONS

The following ~~selected~~discussion combined consolidated historical financial information of Private Escapes for the period January 1, 2009 to September 15, 2009 and the nine months ended September 30, 2008 was derived from the unaudited combined consolidated financial statements of Private Escapes included in this prospectus. The selected combined consolidated historical financial information of Private Escapes as of December 31, 2008 and 2007 and for the years then ended was derived from the audited combined consolidated financial statements of Private Escapes included in this prospectus. Historical financial information after September 15, 2009 is included in the historical financial information of Ultimate Escapes Holdings on the previous page. This information should be read in conjunction with ~~Management’s~~our ~~Discussion and Analysis of~~consolidated ~~Financial Condition and Results of Operations and the~~ financial statements ~~of Private Escapes~~ and the notes thereto included elsewhere in this prospectus.

	For the Period January 1 -			For the Nine Months Ended			As of and for the Years Ended December 31,
	September 15, 2009			September 30, 2008			2008			2007
	(unaudited)			(unaudited)
	(In thousands)
Statement of Operations Data:
Revenues	$	9,434		$	5,541		$	7,425		$	5,283
Operating income (loss)		(959	)		(9,120	)		(11,587	)		(12,189	)
Net loss		(2,587	)		(10,991	)		(14,204	)		(15,078	)
Balance Sheet Data:
Total assets	N/A			N/A			$	55,204		$	54,697
Working capital	N/A			N/A				(29,741	)		(12,354	)
Owners’ equity (deficit)	N/A			N/A				(55,264	)		(43,462	)

SELECTED FINANCIAL DATA OF

SECURE AMERICA ACQUISITION CORPORATION

The following selected historical financial information of Secure America Acquisition Corporation (renamed Ultimate Escapes, Inc. upon the consummation of the Acquisition on October 29, 2009) as of and for the nine months ended September 30, 2009 was derived from the unaudited condensed financial statements of Secure America Acquisition Corporation included in this prospectus. The following selected historical financial information of Secure America Acquisition Corporation as of December 31, 2008 and 2007 and for the year ended December 31, 2008 and for the period from May 14, 2007 (inception) through December 31, 2007 was derived from the audited financial statements included in this prospectus. The results of operations for the interim period are not necessarily indicative of the results of operations which might be expected for the entire year. This information should be read in conjunction with the financial statements of Secure America Acquisition Corporation and the notes thereto included elsewhere in this prospectus.

	As of and for the Nine Months Ended September 30,					As of and for the Year Ended December 31,		As of and for the Period May 14, 2007 (Inception) Through December 31,
	2009			2008		2008		2007
	(Unaudited)			(Unaudited)
	(In thousands, except share and per share data)
Statement of Operations Data:
Interest income	$	114		$	1,230	$	1,272	$	546
Net income (loss)		(265	)		461		432		279
Common Share Data:
Net income (loss) per share – basic and diluted	$	(0.02	)	$	0.04	$	0.03	$	0.05
Common shares outstanding		12,500,000			12,500,000		12,500,000		5,259,000
Balance Sheet Data:
Total assets	$	79,749		$	79,835	$	79,802	$	79,594
Working capital		7,265			76,311		76,259		76,039
Shareholders’ equity		7,521			53,726		53,698		53,266

SELECTED UNAUDITED PRO FORMA

CONDENSED COMBINED FINANCIAL INFORMATION

The following unaudited pro forma condensed combined financial information is designed to show the effects of the accounting mergers of Ultimate Escapes Holdings and Private Escapes and Secure America Acquisition Corporation, giving effect to (a) the acquisition by Ultimate Escapes Holdings, through a contribution agreement, of certain assets and liabilities of Private Escapes and (b) the accounting reverse merger of Ultimate Escapes Holdings and Secure America Acquisition Corporation pursuant to a contribution agreement.

The following should be read in connection with the “Unaudited Pro Forma Condensed Combined Financial Statements” and the audited and unaudited financial statements Ultimate Escapes Holdings, Private Escapes and Secure America Acquisition Corporation which are included elsewhere in this prospectus.

The unaudited pro forma balance sheet data assumes that the accounting reverse merger of Ultimate Escapes Holdings and Secure America Acquisition Corporation took place on September 30, 2009. The acquisition of Private Escapes by Ultimate Escapes Holdings occurred on September 15, 2009 and its effects are already included in the balance sheet data of Ultimate Escapes Holdings as of September 30, 2009.

The unaudited pro forma statement of operations data for the nine months ended September 30, 2009 and for the year ended December 31, 2008 gives effect to the acquisition of Private Escapes by Ultimate Escapes Holdings and to the accounting reverse merger of Ultimate Escapes Holdings and Secure America Acquisition Corporation as if they occurred on January 1, 2008.

The summary unaudited pro forma condensed combined financial data is presented for illustrative purposes only and is not necessarily indicative of the financial condition or results of operations of future periods or the financial condition or results of operations that actually would have been realized had the entities been a single company during these periods.

	Pro Forma Combined as of and for the Nine Months Ended September 30, 2009			Pro Forma Combined as of and for the Year Ended December 31, 2008
	(unaudited)			(unaudited)
	(In thousands, except per share data)
Statement of Operations Data:
Revenues	$	33,994		$	31,953
Operating income (loss)		2,651			(26,336	)
Net loss		(6,393	)		(38,208	)
Common Share Data:
Net loss per share – basic and diluted		(0.76	)		(4.54	)
Common shares outstanding		8,412			8,412
Balance Sheet Data:
Total assets	$	222,356		$	N/A
Working capital (deficit)		(13,313	)		N/A
Owners’ equity (deficit)		(29,361	)		N/A

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the financial statements of Ultimate Escapes Holdings and the notes thereto included elsewhere in this prospectus.

Overview

We are a luxury destination club that sells club memberships offering members reservation rights to use our vacation properties, subject to the rules of the club member’s Club Membership Agreement. Our properties are located in various resort locations throughout the world.

On September 15, 2009, we consummated the ~~contribution~~acquisition ~~by Private Escapes~~ of certain of ~~its~~the assets, liabilities, properties and rights thereto of Private Escapes, in exchange ~~for~~ for ownership units in our subsidiary Ultimate Escapes Holdings. The ~~following discussion of~~operating ~~financial condition and~~ results of ~~operations~~Private ~~refers to the financial statements of Ultimate~~ Escapes ~~Holdings~~are ~~for~~included ~~the~~in ~~nine~~our ~~month~~consolidated ~~periods~~financial ~~ended September 30, 2009~~statements ~~and 2008, and for the years ended December 31, 2008 and 2007. The operating results of Private Escapes are included~~ from September 16, 2009. ~~The~~ ~~operating~~On ~~results~~October of29, ~~Secure America Acquisition Corporation (as Ultimate Escapes~~2009, ~~Inc.~~we ~~was~~consummated ~~named prior to~~ the ~~consummation~~reverse ~~of the~~merger ~~Acquisition)~~with ~~are~~Ultimate ~~not~~Escapes ~~included in this discussion~~Holdings.

WeThe ~~believe~~following ~~that~~discussion ~~our~~of financial ~~performance~~condition ~~will improve in 2010~~ and ~~2011~~results asof aoperations ~~result~~does not ofinclude the ~~combination~~operating results of ~~the~~Secure ~~Ultimate~~America ~~Resort~~Acquisition ~~and~~Corporation ~~Private~~(as ~~Escapes businesses, the~~we ~~utilization~~were ofnamed ~~current~~prior ~~excess~~to ~~capacity and~~ the ~~arrangements~~consummation ~~with~~of ~~various~~the ~~hotels and~~reverse ~~resorts~~merger) ~~coming~~prior ~~into~~to ~~effect~~October ~~in 2010~~30, ~~as well as anticipated improvements in~~ ~~worldwide economic conditions generally~~2009.

We had 1,229 members, 1,214 members and 826 members as of March 31, 2010, December 31, 2009, and December 31, 2008, respectively.

Critical Accounting Policies

Our financial statements and the notes to our financial statements contain information that is pertinent to management’s discussion and analysis. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. On a continual basis, management reviews its estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such reviews, and if deemed appropriate, those estimates are adjusted accordingly. Actual results may vary from these estimates and assumptions under different and/or future circumstances. Management considers an accounting estimate to be critical if:

•	it requires assumptions to be made that were uncertain at the time the estimate was made; and

•	changes in the estimate, or the use of different estimating methods that could have been selected, could have a material impact on our results of operations or financial condition.

The following critical accounting policies have been identified that affect the more significant judgments and estimates used in the preparation of ~~the~~our financial statements ~~of Ultimate Escapes Holdings~~. We believe that the following are some of the more critical judgment areas in the application of our accounting policies that affect our financial condition and results of operations. The following critical accounting policies are not intended to be a comprehensive list of all of our accounting policies or estimates.

29Use of Estimates - The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. The reported amounts of revenues and expenses during the reporting period may be affected by the estimates and assumptions we are required to make. Estimates that are critical to our accompanying consolidated financial statements arise from our belief that (1) we will be able to raise and/or generate sufficient cash to continue as a going concern, (2) our estimates of the expected lives of the club memberships from which we derive our revenues and on which we base our revenue recognition are reasonable, (3) all long-lived assets are recoverable, and (4) our estimates of the cost of our stock-based compensation plans are reasonable. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the period that they are determined to be necessary. It is at least reasonably possible that our estimates could change in the near term with respect to these matters.

Use of Estimates — The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. The reported amounts of revenues and expenses during the reporting period may be affected by the estimates and assumptions we are required to make. Estimates that are critical to our accompanying consolidated financial statements arise from our belief that (1) we will be able to raise and/or generate sufficient cash to continue as a going concern, (2) our estimates of the expected lives of the club memberships from which we derive our revenues and on which we base our revenue recognition are reasonable, (3) all long-lived assets are recoverable, and (4) our estimates of the cost of our stock-based compensation plans are reasonable . Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the period that they are determined to be necessary. It is at least reasonably possible that our estimates could change in the near term with respect to these matters.24

Revenue Recognition - We derive our revenue from the club memberships we sell, which allow the club members to use the club properties owned or leased by us. Different levels of club membership provide access to different properties and/or increased usage of the properties. Club members pay a one-time club membership fee (which includes a non-refundable initiation fee), together with annual dues. Club members sometimes pay additional fees or charges related to their use of specific properties or club services. Club members may upgrade their level of membership at any time by paying additional upgrade fees and annual dues. The terms of each club membership is set out in a Club Membership Agreement.

We derive our revenue from the club memberships we sell, which allow the club members to use the club properties owned or leased by us. Different levels of club membership provide access to different properties and/or increased usage of the properties. Club members pay a one-time club membership fee (which includes a non-refundable initiation fee), together with annual dues. Club members sometimes pay additional fees or charges related to their use of specific properties or club services. Club members may upgrade their level of membership at any time by paying additional upgrade fees and annual dues. The terms of each club membership is set out in a Club Membership Agreement.

Club members who resign may receive a partial redemption of their membership fee. We provide assistance to club members who resign by using commercially reasonable efforts to resell a resigned club members’ membership, and upon such resale, the resigning club member generally receives 80% of the proceeds of sale and we retain the remainder as a transfer fee. In the event we are unable to resell a resigning club members’ membership after an agreed period of time, we have certain arrangements with such club members to provide a partial redemption of their membership fee (excluding the initiation fee), based on a sliding scale that declines to zero over a 10 year period.

~~For~~We ~~purposes of our audited financial statements, we~~ amortize the non-refundable initiation fee over the expected life of the club membership, currently estimated as 10 years. The remaining portion of the club membership fee, which is included in membership deposits-redemption assurance program in our consolidated balance sheet, is amortized over a 10 year period using the straight line method. Management believes that, based on their knowledge of the industry and our competitors, our own extrapolated experience, and practices in similar membership organizations, that period reasonably reflects the expected life of the club memberships, and is consistent with any obligation we may have to provide a partial refund of the membership fee. Members who joined under a previous plan (no longer offered) may receive a refund of their membership fee (excluding the non-refundable initiation fee), subject to the redemption procedures identified in their Club Membership Agreements. These fees, which are included in membership deposits - other programs in our consolidated balance sheet, are subject to refund should the member resign and are not recognized in income.

Annual club membership dues are billed in advance. Payment of these annual dues permits the club member to continue to make reservations and use the club properties during their membership year and the annual dues are recognized in income on a straight-line basis over the 12 month period to which they relate. Revenue from ancillary charges and other services provided by us to club members when using club properties is recognized at the time of sale.

Impairment of of Long-Lived Assets and Goodwill - We analyze our long-lived assets, including property and equipment and intangible assets, in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360 “ Property, Plant and Equipment ” annually and when events and circumstances might indicate that the assets may not be recoverable. If the undiscounted net cash flows are less than the assets’ carrying amounts, we record an impairment based on the excess of the assets’ carrying value over fair value. Fair value is determined based on discounted cash flow models, quoted market values and third-party appraisals. We evaluate our real estate assets on a combined basis, as future cash flows include club membership sales and dues that are not identifiable to individual properties. Estimates of future cash flows are based on internal projections over the expected useful lives of the assets and include cash flows associated with future maintenance and replacement costs, but exclude cash flows associated with future capital expenditures that would increase the assets’ useful lives. Our management currently believes there is no impairment beyond that already recognized for those assets held for sale at March 31, 2010.

We analyze our long-lived assets, including property and equipment and intangible assets, in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360 “Property, Plant and Equipment” annually and when events and circumstances might indicate that the assets may not be recoverable. If the undiscounted net cash flows are less than the assets’ carrying amounts, we record an impairment based on the excess of the assets’ carrying value over fair value. Fair value is determined based on discounted cash flow models, quoted market values and third-party appraisals. We evaluate our real estate assets on a combined basis, as future cash flows include club membership sales and dues that are not identifiable to individual properties. Estimates of future cash flows are based on internal projections over the expected useful lives of the assets and include cash flows associated with future maintenance and replacement costs, but exclude cash flows associated with future capital expenditures that would increase the assets’ useful lives. Our management believes there is no impairment as of September 30, 2009.25

Goodwill consists of the excess of the purchase price paid for Private Escapes over the fair value of the identifiable assets and liabilities acquired. Goodwill is ~~not~~ not amortized, but is tested for impairment, at least annually, by applying the recognition and measurement provisions of FASB ASC 350-20 “ Goodwill ”, which compares ~~the~~ the carrying amount of the asset with its fair value. If impairment of carrying value based on the estimated fair value exists, we measure the impairment through the use of projected discounted cash flows. We operate as a single operating segment. We have not identified any components within our single operating segment and thus have a single reporting unit for purposes of our goodwill impairment test.

30Stock-based Compensation - As described in our financial statements for the fiscal year ended December 31, 2010, in “ Note 13 — Equity Compensation”, we previously had a stock-based compensation plan utilizing equity units of our former parent company, Ultimate Resort, LLC (“Ultimate Resort”). That plan was discontinued on completion of the reverse merger on October 29, 2009, and as of that date we adopted the 2009 Stock Option Plan, which provides for the issuance of options to acquire up to 1,200,000 shares of our common stock.

Stock-based compensation

Ultimate Escapes Holdings previously had a stock-based compensation plan utilizing equity units of its former parent company, Ultimate Resort, LLC, which plan is described in its financial statements in “Note 13 – Equity Compensation”. Following the merger between Ultimate Escapes Holdings and us, we adopted the 2009 Stock Option Plan, which provides for the issuance of options on up to 1,200,000 shares of common stock of Ultimate Escapes.

We recognize compensation expense in an amount equal to the grant-date fair value of the equity units or, following adoption of the 2009 Stock Option Plan, the grant-date fair value of the common stock options. The estimated fair value of these equity units and options, as of the date of grant, is recorded as compensation cost over the vesting period.

Determining the fair value of the equity units previously issued required making potentially complex and subjective judgments. ~~Ultimate~~Our ~~Escapes Holdings’~~ approach to valuation of the units, which were granted to employees at no cost to them, was to estimate their fair value based on the proceeds received by the parent company for other equity units with broadly similar characteristics. There is was inherent uncertainty in making these estimates. During 2008 and ~~the~~ 2009 ~~period to date~~, ~~Ultimate~~we ~~Escapes Holdings~~ estimated the fair value at $30,000 per unit. During 2008 ~~and the first nine months of 2009~~, there were 83 ~~and~~equity 67 units~~, respectively,~~ that vested. Atand ~~September~~at ~~30,~~December ~~2009~~31, 2008, there were a further ~~288~~235 equity units that had not yet vested. All of these ~~288~~235 ~~units~~equity ~~vested immediately on completion of the Acquisition on October 29~~units, ~~2009.~~together Atwith ~~the~~121 ~~time~~equity ~~of the Acquisition, ownership~~ units ~~convertible~~issued ~~into~~in ~~common stock by the equity unit holders had an indicated value of approximately $30.6 million~~2009, ~~equivalent to 3,858,572 shares~~vested ofimmediately ~~common stock valued at $7.94 per share. Ultimate Resort has 1,431 equity units outstanding, and~~ on acompletion ~~pro rata basis each unit~~ of ~~Ultimate Resort would have an indicated value of approximately $25,700 when taking into account~~ the ~~assumption~~reverse ofmerger ~~the~~on ~~JDI~~October ~~note~~29, ~~which approximates the fair value of $30,000 used in the company’s estimate of compensation expense and the fair value of units~~2009. We recognized compensation expense of approximately $56.36 million onin ~~October 29~~2009, ~~2009~~including approximately $5 million as a result of the accelerated vesting of these equity units upon consummation of the ~~Acquisition~~ reverse merger.

Recent Accounting Pronouncements ~~— The following Accounting Standards Codification Updates have been issued, or will become effective, after the end of the period covered by this discussion:~~

The following Accounting Standards Codification Updates have been issued, or will become effective, after the end of the period covered by this discussion:

Pronouncement	Issued	Title

ASU No. 2009-13	October 2009	Revenue Recognition (Topic 605): Multiple-Deliverable Revenue Arrangements – a consensus of the FASB Emerging Issues Task Force

ASU No. 2009-14	October 2009	Software (Topic 985): Certain Revenue Arrangements That Include Software Elements—a consensus of the FASB Emerging Issues Task Force

ASU No. 2009-15	October 2009	Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing

ASU No. 2009-16	December 2009	Transfers and Servicing (Topic 860): Accounting for Transfers and Financial Assets.

ASU No. 2009-17	December 2009	Consolidations (Topic 810): Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities

ASU No. 2010-01	January 2010	Equity (Topic 505): Accounting for Distributions to Shareholders with Components of Stock and Cash – a consensus of the FASB Emerging Issues Task Force

ASU No. 2010-02	January 2010	Consolidation (Topic 810): Accounting and Reporting for Decreases in Ownership of a Subsidiary – a Scope Clarification

3126

Management does not anticipate that the new accounting pronouncements listed above will have a material impact on our consolidated financial statements.

ASU No. 2010-03	January 2010	Extractive Activities – Oil and Gas (Topic 932): Oil and Gas Reserve Estimation and Disclosures

ASU No. 2010-04	January 2010	Accounting for Various Topics: Technical Corrections to SEC Paragraphs

ASU No. 2010-05	January 2010	Compensation - Stock Compensation (Topic718): Escrowed Share Arrangements and the Presumption of Compensation

ASU No. 2010-06	January 2010	Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Measurements

ASU No. 2010-07	January 2010	Not-for-Profit Entities (Topic 958): Not-for-Profit Entities - Mergers and Acquisitions

ASU No. 2010-08	February 2010	Technical Corrections to Various Topics

ASU No. 2010-09	February 2010	Subsequent Events (Topic 855): Amendments to Certain Recognition and Disclosure Requirements

ASU No. 2010-10	February 2010	Consolidation (Topic 810): Amendments for Certain Investment Funds

ASU No. 2010-11	March 2010	Derivatives and Hedging (Topic 815): Scope Exception Related to Embedded Credit Derivatives

ASU No. 2010-12	April 2010	Income Taxes (Topic 740): Accounting for Certain Tax Effects of the 2010 Health Care Reform Acts (SEC Update)

ASU No. 2010-13	April 2010	Compensation – Stock Compensation (Topic 718): Effect of Denominating the Exercise Price of a Share-Based Payment Award in the Currency of the Market in Which the Underlying Equity Security Trades—a consensus of the FASB Emerging Issues Task Force

ASU No. 2010-14	April 2010	Accounting for Extractive Activities—Oil & Gas—Amendments to Paragraph 932-10-S99-1 (SEC Update)

ASU No. 2010-15	April 2010	Financial Services—Insurance (Topic 944): How Investments Held through Separate Accounts Affect an Insurer’s Consolidation Analysis of Those Investments—a consensus of the FASB Emerging Issues Task Force

ASU No. 2010-16	April 2010	Entertainment—Casinos (Topic 924): Accruals for Casino Jackpot Liabilities—a consensus of the FASB Emerging Issues Task Force

ASU No. 2010-17	April 2010	Revenue Recognition—Milestone Method (Topic 605): Milestone Method of Revenue Recognition—a consensus of the FASB Emerging Issues Task Force

ASU No. 2010-18	April 2010	Receivables (Topic 310): Effect of a Loan Modification When the Loan Is Part of a Pool That Is Accounted for as a Single Asset—a consensus of the FASB Emerging Issues Task Force

ASU No. 2010-19	May 2010	Foreign Currency (Topic 830): Foreign Currency Issues: Multiple Foreign Currency Exchange Rates (SEC Update)

To the extent appropriate, the guidance in the above Accounting Standards Codification Updates is already reflected in our consolidated financial statements and Adoption of the Updates that have become effective did not have a material effect on our consolidated financial statements. Management does not anticipate that these accounting pronouncements will have any future effect on our consolidated financial statements.

Results of Operations

The following table sets forth our historical consolidated income statement data ~~for Ultimate Escapes Holdings~~ (in thousands of dollars):

	Nine Months Ended									Year Ended
	For the Three Months									Year Ended
	September 30,									December 31,
	Ended March 31,									December 31,
	2009			2008			% Change			2008			2007			% Change
							%									%
	(unaudited)			(unaudited)			(unaudited)									(unaudited)
	2010			2009			Change			2009			2008			Change
REVENUES
Membership – annual dues	$	114,~~331~~487		$	123,~~353~~819			(817	)%	$	1714,~~486~~938		$	1317,~~150~~486			33-15	%
Membership – upgrade fees		48-			~~319~~50			~~(85~~	)%*		~~409~~60			~~338~~409			21-85	%
Membership – fees		3,318			2,719			22	%		3,650			1,473			148	%
Membership – membership fees		1,329			801			66	%		7,052			3,650			93	%
Membership – assessment fees		~~8,274~~-			-3,036			-	*		-12,144			-			-	*
Other revenue		21,~~090~~499			~~1,106~~922			8963	%		~~996~~2,817			~~152~~996			~~555~~183	%
REVENUES		257,~~061~~315			168,~~497~~628			5215	%		2237,~~541~~011			1522,~~113~~541			4964	%
OPERATING EXPENSES:
Property operating expenses		7,757			7,031			10	%		9,900			6,952			42	%
Property operating costs		3,242			2,682			21	%		11,043			9,900			12	%
Depreciation and amortization		31,~~176~~976			31,~~275~~038			(390	)%		45,~~479~~526			24,~~819~~479			5923	%
Lease costs		21,~~457~~423			~~2,720~~887			~~(10~~60	)%		3,~~593~~503			23,~~461~~593			46-3	%
Advertising		~~743~~184			~~1,927~~151			~~(61~~22	)%		21,~~307~~231			32,~~986~~307			~~(42~~-47	)%
Salaries and contract labor		4,805			7,867			(39	)%		9,420			4,347			117	%
Salaries and contract labor (including $6,604 and $2,169 of non-cash stock-based compensation)		2,015			1,725			17	%		11,753			9,419			25	%
General and administrative		21,~~072~~369			~~4,764~~725			~~(57~~89	)%		63,~~182~~513			105,~~915~~601			~~(43~~-37	)%
(Gain) on sale of property and equipment		(107	)		(178	)		(40	)%		(27	)		(12	)		132	%
Loss (gain) on sale of property and equipment		321			-				*		535			(27	)			*
Sales commissions		335			922			(64	)%		1,032			1,498			(31	)%
Loss on impairment of assets held for sale		289			258			12	%		2,839			-				*
OPERATING EXPENSES		21,238			28,327			(25	)%		36,885			32,966			12	%
Sales commissions		210			114			84	%		479			1,032			-54	%
INCOME (LOSS) BEFORE OTHER INCOME (EXPENSE)		3,823			(11,830	)		132	%		(14,344	)		(17,853	)		20	%
OPERATING EXPENSES		11,029			7,580			46	%		40,422			36,304			11	%
INCOME (LOSS) FROM OPERATIONS		(3,714	)		1,048			-453	%		(3,411	)		(13,763	)		75	%
OTHER INCOME (EXPENSE):
Interest expense		(73,~~120~~004	)		(72,~~336~~293	)		(331	)%		(910,~~156~~006	)		(79,~~408~~717	)		243	%
Interest income		7320			~~219~~22			~~(67~~-9	)%		~~278~~98			~~616~~278			~~(55~~-65	)%
OTHER INCOME (EXPENSE) – Net		(7,048	)		(7,117	)		(1	)%		(8,878	)		(6,792	)		31	%
Transaction expenses		-			-			-	*		(384	)		-				*
NET LOSS	$	(3,225	)	$	(18,948	)		83	%	$	(23,222	)	$	(24,645	)		6	%
RAP exchange inducement		-			-			-	*		(714	)		-				*
Change in contingent acquisition consideration		246			-				*		1,458			-				*
OTHER INCOME (EXPENSE) – Net		(2,738	)		(2,271	)		21	%		(9,548	)		(9,439	)		1	%
INCOME BEFORE INCOME TAXES		(6,452	)		(1,223	)		-428	%		(12,959	)		(23,202	)		44	%
BENEFIT (PROVISION) FOR INCOME TAXES		(20	)		(1	)			*		(6	)		(20	)		-70	%
NET LOSS	$	(6,472	)	$	(1,224	)		-429	%	$	(12,965	)	$	(23,222	)		44	%

32* % change not meaningful

~~Nine Months Ended September 30, 2009 compared with the Nine Months Ended September 30, 2008 (in thousands) (unaudited)~~28

Three Months Ended March 31, 2010 compared with the Three Months Ended March 31, 2009 (in thousands)

Revenues

Revenues of $257,~~061~~315 ~~increased~~decreased by $81,~~564~~313, or 5215%, during the ~~nine~~quarter ~~months~~ ended ~~September 30,~~March ~~2009~~31, 2010, from $168,~~497~~628 during the same period in ~~2008~~2009. ~~The~~Revenues ~~higher~~in ~~revenues during the nine months ended September 30,~~ 2009 ~~reflect~~included ana $83,~~274~~ 036 assessment fee charged to members in 2009 that was not charged in ~~2008~~2010. Membership- annual dues were $114,~~331~~487 ~~during~~in ~~the~~2010, ~~nine~~representing ~~months~~an ~~ended~~increase ~~September~~of 30$668, ~~2009,~~or ~~representing~~17% afrom ~~decrease~~annual dues of $3,819 in 2009. Membership fees of $1,~~022,~~329 in 2010 increased by $528 or 866% ~~from~~compared ~~annual dues~~with of $~~12,353~~801 for the same period in ~~2008~~2009. Both ~~because~~annual ofdues ~~early~~and ~~dues~~membership ~~renewal~~fees increased because of ~~programs~~the ~~offered~~larger inmembership ~~2008~~base ~~and~~resulting ~~not~~from ~~offered~~the inSeptember 2009, ~~which~~acquisition ~~accelerated revenues~~of ~~into~~Private ~~2008~~Escapes. Other revenue was $21,~~090~~499 ~~during~~in ~~the~~2010, ~~nine~~representing ~~months~~a ~~ended~~net ~~September~~increase 30of $577, or 63% compared with $922 in 2009. In February 2008, ~~representing~~we acquired six properties from an ~~increase~~unrelated ofluxury destination club for approximately $~~984~~15,100. The orpurchase ~~89%~~price ~~compared~~was tofinanced by borrowings under our CapitalSource loan agreement and the issuance of nine corporate memberships valued at $12,~~106~~700. In 2010, the holders of those memberships have now elected not to continue to pay annual dues for three of the ~~same~~memberships ~~period~~and, inas a ~~2008~~result, ~~due~~their redemption rights related to ~~the~~those ~~cross~~memberships ~~reservation~~were ~~program~~surrendered, resulting ~~fees~~in a reduction in ~~2009~~our membership liability of $900. This increase in other revenue was partially offset by a decrease of $263 relating to nightly fees charged to Private Escapes members as compared with the cross reservation program fees charged in 2009 for allowing their members to stay at ~~Ultimate~~our ~~Escapes Holding’s~~ properties. This cross -reservation program ended effective September 15, 2009, ~~the~~when ~~date~~we ofacquired ~~the merger of~~ Private Escapes ~~and Ultimate Escapes Holdings~~.

Operating Expenses

Operating expenses were $2111,~~238~~029 ~~during~~in ~~the nine months ended September 30~~2010, ~~2009,~~ representing aan ~~decrease~~increase of $73,~~090~~449, or 2546%, from operating costs of $287,~~327~~580 ~~for the same period~~ in ~~2008~~2009. ~~Salary~~Property ~~and~~operating ~~contract labor~~ costs ~~decreased~~increased $~~3,062~~560 ~~during~~in ~~the~~2010 ~~nine~~from ~~months~~2009 ~~ended~~primarily ~~September~~due ~~30,~~to ~~2009~~the ~~compared~~increase ~~with~~in the ~~same period~~number inof ~~2008~~ properties due to ~~staffing~~the ~~reductions~~acquisition ~~and~~of ~~labor~~Private ~~cost~~Escapes ~~savings~~less ~~implemented in~~ the ~~second~~$397 ~~half~~ of ~~2008~~cross ~~and~~reservation program afees ~~reduction~~in of2009 ~~$347~~charged inby ~~equity compensation. General~~Private &Escapes ~~administrative~~for ~~costs~~allowing ~~decreased~~our ~~for~~members ~~the~~to stay ~~nine~~at ~~months~~their ~~ended~~properties prior to the September 3015, 2009 ~~compared~~acquisition ~~with~~of ~~the~~certain ~~same~~of their ~~period~~assets inand ~~2008~~liabilities. Depreciation byand ~~$2,692~~amortization increased ~~due~~by $938 to ~~reductions~~$1,976 in ~~credit~~2010, ~~card~~from ~~fees of~~ $1,~~200,~~038 ~~legal~~in ~~and professional~~2009 ~~fees~~reflecting the acquisition of ~~$466,~~Private ~~insurance~~Escape ~~cost~~properties ofin ~~$417,~~September ~~travel~~2009 ~~costs~~and amortization of $~~354,~~803 ~~and~~related ~~office~~to ~~lease cost~~the ofintangible ~~$94~~assets acquired. ~~Advertising~~ Lease costs ~~decreased~~increased $536 to $1,~~184~~423 ~~during~~in ~~the~~2010 ~~nine months~~from ~~ended~~$887 ~~September~~in ~~30,~~ 2009 ~~from~~due partially to the ~~same~~23% ~~period~~increase in ~~2008~~the ~~due~~number toof aleases ~~revised marketing~~from ~~strategy~~the toacquisition ~~target~~of ~~member~~Private ~~referrals~~Escapes but ~~and~~also ~~other~~due ~~qualified~~the ~~leads~~implementation ~~produced as~~in a2010 ~~result~~ of awinter ~~joint~~seasonal ~~marketing~~leases ~~agreement~~that ~~with~~will increase ~~Private~~our ~~Escapes~~costs ~~that began~~ in the ~~second~~first ~~half~~quarter ofbut ~~2008. Sales~~reduce ~~commissions~~costs ~~decreased~~during ~~$586~~the ~~for~~balance ~~the~~of ~~nine~~the ~~months~~year. Salary ~~ended~~costs ~~September~~increased ~~30,~~by ~~2009~~$290 in 2010 compared with ~~the~~2009, primarily ~~same~~as ~~period~~a inresult ~~2008~~of ~~due to~~the ~~lower~~Private ~~sales~~Escapes ~~volumes in 2009~~acquisition. ~~Property~~General ~~operating~~and administrative costs increased ~~$726~~ in 2009 ~~from~~compared with 2008 ~~primarily~~by $644 due primarily to ~~the~~legal, ~~cross~~accounting, ~~reservation~~consulting, ~~program~~and ~~fees~~investor ~~in 2009~~related ~~charged~~fee byincreases ~~Private~~of ~~Escapes~~$604 over ~~for~~2009. Sales ~~allowing~~commissions ~~Ultimate~~increased ~~Escapes~~$96 ~~Holdings’~~in ~~members~~2010 compared with 2009 toas ~~stay~~a atresult ~~Private~~of ~~Escapes’~~a ~~properties~~membership ~~prior~~dues torebalancing ~~the~~program ~~September~~implemented ~~15,~~in ~~2009~~March ~~merger~~2010. ~~Depreciation~~In ~~and amortization~~2010, ~~decreased~~we byincurred ~~$100 to $3,176~~a ~~during~~net ~~the~~loss ~~nine~~of ~~months ended September 30, 2009, from~~ $~~3,275~~321 ~~during~~on the sale ~~same~~of certain ~~period~~properties and inrecognized ~~2008~~an ~~reflecting~~impairment ~~the~~loss ~~sale~~ of ~~properties~~$289 related into ~~2008~~certain ~~and 2009. For~~properties ~~the~~held ~~nine~~for ~~months~~sale, ~~ended~~compared ~~September~~with ~~30,~~an ~~2009, we~~impairment ~~incurred~~charge aof $~~107~~258 ~~net~~for ~~loss on the sales of~~ certain properties in 2009. ~~For~~Impairment ~~the~~charges ~~nine~~are ~~months~~determined ~~ended~~by ~~September~~comparing ~~30,~~the ~~2008, we~~carrying ~~had~~value aof ~~$178~~the ~~net~~assets ~~loss~~held onfor sale with the expected ~~sale~~net proceeds of ~~certain~~ ~~properties~~sale.

Income (Loss) Before Other Income (Expense)

~~Income~~As a (result of the above, our loss) before other income (expense) ~~increased~~was by $15(3,~~653,~~714) orin ~~132%,~~the first toquarter ~~$3,823 during~~of ~~the~~2010 ~~nine~~compared ~~months~~with ~~ended~~income ~~September~~of 30$1,048 for the same period in 2009, ~~from~~ a ~~loss~~decrease of $11(4,~~830~~762) ~~during~~ or 453%. This change was due primarily to the assessment ~~nine~~revenue ~~months~~program ~~ended~~in ~~September~~2009 30not repeated in 2010, ~~2008~~and increased operating costs resulting from the acquisition of Private Escapes, including amortization of intangible assets acquired.

Other Income (Expense)

Interest expense ~~decreased~~increased ~~slightly~~by to $~~7,120~~711 ~~during~~for ~~the nine months ended September 30~~2010, ~~2009,~~ from $72,~~336~~293 ~~during the same period~~ in ~~2008. Interest~~2009, ~~income decreased~~due ~~by $146~~ to ~~$73 during~~ the ~~nine~~additional debt ~~months~~acquired ~~ended~~in the September ~~30,~~ 2009 ~~from $219~~purchase ~~during~~of ~~the~~Private Escapes. Interest ~~same~~income ~~period~~decreased inby ~~2008~~$2 ~~due~~ to ~~lower~~$20 ~~interest~~in ~~bearing~~2010 ~~money~~from ~~market cash~~$22 ~~balances~~ in 2009 ~~than 2008~~.

~~Year~~ As ~~Ended~~of ~~December~~March 31, ~~2008~~2010, ~~compared~~we ~~with~~recognized a gain of $246 related to the ~~Year~~outstanding contingent ~~Ended~~consideration for our September 15, 2009 acquisition of the business of Private Escapes, as a result of a decrease since December 31, ~~2007~~2009 (in the ~~thousands)~~fair value of our common stock, in which the consideration is payable.

Year Ended December 31, 2009 compared with the Year Ended December 31, 2008 (in thousands)

Revenues

Revenues of $2237,~~541~~011 increased by $714,~~427~~470, or 4964%, during the year ended December 31, ~~2008,~~ 2009, from $1522,~~113~~541 during ~~2007.~~the ~~$4,336~~same ofperiod ~~the~~in ~~increase~~2008. ~~was~~The ~~the~~higher ~~result~~revenues ofin 2009 include a ~~larger~~$12,144 ~~club membership~~assessment ~~base~~fee charged to members in ~~2008~~2009 ~~from~~that ~~2007~~was ~~and~~not ~~offers~~charged in to2008. Membership ~~club~~annual ~~members~~dues towere ~~renew~~$14,938 ~~their~~in ~~dues early.~~2009, ~~The~~representing ~~second~~a decrease ~~largest~~of ~~increase~~$2,548, inor ~~revenue~~15% from ~~2007~~annual todues ~~2008~~of ~~was~~$17,486 ~~due~~in to2008, ~~the~~primarily ~~additional~~because ~~new~~of ~~club~~early ~~member~~dues ~~and~~renewal ~~upgrade~~programs ~~sales~~offered in ~~2007~~2008 and ~~2008~~not ~~resulting~~offered in 2009, which accelerated revenues into 2008. Other revenue was $2,~~248~~817 ofin 2009, ~~additional~~representing ~~club~~an ~~membership~~increase ~~amortization.~~of ~~The~~$1,821, ~~balance~~or of183% ~~the~~compared ~~increase~~ with $996 in 2008 ~~was~~due to ~~from~~the ~~other~~cross ~~revenue~~reservation ~~sources~~program ~~including~~fees ~~resort~~in ~~items~~2009 ~~billed~~charged to ~~club~~Private Escapes for allowing their members, ~~nightly~~to ~~fees,~~stay ~~reciprocity~~at ~~agreements~~our properties. This cross-reservation program ended effective September 15, ~~and~~2009, ~~American~~when ~~Express~~we ~~promotion~~acquired ~~programs~~Private Escapes.

Operating Expenses

Operating expenses were $3640,~~885~~422 ~~during~~in ~~the year ended December 31~~2009, ~~2008,~~ representing an increase of $34,~~919~~117, or 1211%, from operating costs of $3236,~~966~~305 ~~for~~in ~~2007~~2008. Property operating costs increased by $21,~~949~~143 in 2009 from 2008, ~~but~~primarily ondue ato ~~monthly~~the ~~basis~~cross ~~they~~reservation ~~decreased~~program byfees 5%in ~~due~~2009 tocharged anby ~~average~~Private ~~reduction~~Escapes offor ~~total~~allowing ~~properties~~our ofmembers ~~two,~~to ~~and~~stay ~~lease~~at ~~property~~their ~~costs~~properties ~~were~~prior ~~$1,132~~to ~~higher~~the inSeptember ~~2008~~15, ~~but~~2009 onacquisition aof ~~monthly~~certain ~~basis they~~of ~~were~~their ~~down~~assets 3%and ~~due to the elimination of four leases~~liabilities. Depreciation and amortization increased by $1,~~659~~ 047 to $45,~~479~~526 ~~during~~in ~~the year ended December 31~~2009, ~~2008,~~ from $24,~~819~~479 ~~during 2007. Asset additions~~ in ~~2007, including the purchase~~ ~~of 56 properties from Complete Retreats in May 2007, and asset additions in~~ 2008, ~~including~~reflecting the ~~February 2008~~ acquisition of ~~six~~Private Escape properties, ~~resulted~~ in ~~increased~~ ~~depreciation in 2008 over 2007~~September 2009. Advertising ~~expenses~~costs ~~were~~decreased $1,~~679 lower~~076 in 2009 from 2008 due to a revised marketing strategy to target ~~leads~~member referrals and ~~the~~other ~~joint~~qualified leads ~~marketing~~produced ~~agreement~~as ~~between~~a usresult ~~and~~of a joint marketing agreement with Private Escapes that began in the second half of 2008. Salary ~~Salaries~~costs ~~and contract labor~~ increased by $52,~~072~~334 in 2009 compared with 2008, ~~from~~primarily ~~2007~~as ~~with~~a result of increased stock-based ~~approximately~~compensation $1expense,~~600~~ ~~due~~primarily toas ~~additional~~a ~~employees~~result ~~and~~of ~~salary~~the ~~and~~accelerated ~~wage~~vesting ~~increases~~of equity units in ~~2008~~connection with the reverse merger with SAAC, offset by staffing reductions and ~~increased~~labor ~~equity~~cost ~~compensation~~savings of ~~$1,384~~which inhad ~~2008~~been ~~compared~~implemented ~~with~~in ~~2007.~~late 2008. General and administrative ~~expenses~~costs ~~were~~decreased ~~$4,734~~in ~~lower~~2009 incompared with 2008 ~~compared~~by ~~with 2007~~$2,088 due primarily asto areductions ~~result~~in credit card fees of a$1,445, insurance ~~reduction~~costs of ~~legal~~$300, travel costs of $4216,~~408~~ ~~due~~and tooffice ~~the~~lease costs of ~~completion~~$41. In 2009, we incurred a net loss of $535 on the ~~asset~~sale of certain ~~purchase~~properties and inrecognized ~~2007~~an impairment loss of ~~fifty-six~~$2,839 related to certain properties held for sale, ~~the~~compared ~~closure~~with of a $27 net gain on the sale ~~Westport,~~of CTcertain ~~office~~properties in 2008. The ~~lowering~~assets ~~costs~~held for sale were chosen because of low occupancy by ~~$321~~club ~~and~~members ~~lower~~or ~~insurance~~because ~~costs~~we determined ofthat ~~$707~~we inhad ~~2008~~excess inventory. Impairment was calculated by comparing the carrying value on the books with the expected net proceeds of the sale. Sales commissions indecreased ~~2008~~$553 ~~were~~in ~~$466~~2009 ~~lower~~compared onwith ~~lower~~2008 ~~club~~due ~~membership~~to lower sales volumes in 2009.

~~Loss~~ Income (Loss) Before Other Income (Expense)

~~Loss~~As a result of the above, our loss before other income (expense) ~~decreased~~improved by $310,~~509~~353, or 2075%, to ~~$(14,344)~~a ~~during the~~loss ~~year~~of ~~ended~~$3,411 ~~December~~for 312009, ~~2008,~~ from a loss of $~~(17~~13,~~853)~~764 ~~during~~in ~~2007~~2008.

Other Income (Expense)

Interest expense increased ~~by $1,748,~~ to $910,~~156~~006 ~~during~~for ~~the year ended December 31~~2009, ~~2008,~~ from $~~7,408 during 2007. Interest on the CapitalSource revolving loan increased in 2008 from 2007 by $2,421. Although the average interest rate declined in 2008 to~~ 9~~% from 10% in 2007~~,717 ~~the average loan amount increased~~ in 2008 ~~to $86~~,~~283 from~~ ~~$76,514 in 2007. Interest on the CapitalSource 16% term loan decreased $476 in 2008 from 2007~~ due to ~~principal payments reducing~~ the ~~average borrowing from~~ ~~$8,100~~additional toacquisition ~~$2,355.~~debt Inin ~~connection with~~ the ~~loan~~September ~~agreement,~~2009 ~~on April 30, 2007, the company issued to CapitalSource a warrant to~~ purchase ~~43 Class C common equity units~~ of ~~Ultimate Resort, at an exercise price of $12 per unit. On May 23, 2008,~~Private ~~the lender agreed to cancel the warrant in exchange for a $750 payment~~Escapes. Interest income decreased by $~~338~~180 to $~~278~~98 ~~during~~in ~~the~~2009 ~~year~~from ~~ended~~$278 in ~~December 31,~~ 2008 ~~from $616 during 2007~~ due to lower interest -bearing money market cash balances in ~~2008~~ ~~than~~2009 ~~2007~~than 2008.

In connection with the consummation of the reverse merger in October 2009, we incurred $384 of transaction-related expenses.

In connection with the reverse merger in October 2009, we offered our members the opportunity to convert their outstanding Redemption Assurance Program (RAP) balance to our common stock. We subsequently issued $8,963 of common stock in connection with the conversion of $8,249 of the members’ RAP balance to common stock and recognized $714 as an inducement expense.

As of December 31, 2009, we recognized a gain of $1,458 related to the outstanding contingent consideration for our September 15, 2009 acquisition of the business of Private Escapes, as a result of both a change in the estimate of the contingent consideration payable and a decrease since the acquisition date in the fair value of our common stock, in which the consideration is payable.

Liquidity and Capital Resources (in thousands)

Historically, our primary sources of cash have been cash flows from equity capital, club membership fees, annual dues, bank borrowings and term loans. Cash has been used for real estate purchase transactions, repayment of long term debt, purchases of equipment and working capital to support our growth. In 2009, a one time assessment fee was levied on our membership base. Membership fees and upgrade fees are subject to the health of the economy and are less predictable. We do not intend to levy an assessment fee in 2010 unless the majority of members vote in favor of any proposed assessment. We intend to seek to raise more equity in 2010. We also plan to sell excess properties in our portfolio, the proceeds of which will primarily be used to repay debt. We have plans to spread out the collection of annual dues more evenly throughout the year.

Cash and cash equivalents, consisting primarily of deposits with financial institutions and credit card holdbacks, but excluding $4,795 of restricted cash, was $1,684 at September 30, 2009, compared with $1,077 at December 31~~, 2008. The increase of $607 was largely attributable to the club member assessment program initiated and implemented in the first five months of 2009.~~

WeCash and ~~anticipate~~cash ~~being~~equivalents, ~~able~~consisting toprimarily ~~meet~~of ~~our~~deposits ~~projected~~with ~~internal~~financial ~~growth~~ institutions and ~~operating~~credit ~~needs~~card holdbacks, ~~including~~ ~~capital~~but ~~expenditures~~excluding $2,890 and ~~expect~~$4,343 toof ~~meet~~restricted ~~the~~ cash, was ~~requirements~~$1,846 ofat ~~our contractual~~March ~~obligations~~31, ~~for~~2010 atand ~~least~~$2,747 ~~the~~at ~~next~~December 1231, ~~months.~~2009, ~~Planned~~compared ~~capital~~with $966 ~~expenditure~~at ~~projects~~December ~~include~~31, ~~approximately~~2008, respectively. The increase of $1,~~100~~781 ~~for~~was ~~the~~largely attributable ~~complete~~to ~~renovation of~~ the ~~seven~~club ~~Trump~~member ~~Tower~~assessment ~~units~~program ininitiated ~~New York,~~ and implemented in the ~~routine~~first ~~ongoing~~five ~~maintenance requirements~~months of ~~all owned properties in the portfolio~~2009.

~~As shown~~We inanticipate ~~the~~being ~~accompanying~~able ~~consolidated~~to ~~financial~~meet ~~statements,~~our weprojected ~~incurred~~internal ~~net~~growth ~~losses of $3,225, $23,222~~ and ~~$24,645~~operating ~~during the nine months ended September 30~~needs, ~~2009 and~~ ~~the~~including ~~years~~capital ~~ended December 31~~expenditures, ~~2008~~ and ~~2007,~~expect ~~respectively.~~to Asmeet ofthe ~~September~~cash ~~30, 2009~~requirements ~~and~~of ~~December 31, 2008,~~ our ~~current liabilities exceed our current assets by~~ ~~approximately~~contractual ~~$17,461~~obligations ~~and~~for ~~$8,804,~~at ~~respectively.~~least ~~In addition, although we have completed~~ the ~~acquisition~~ ~~of certain~~next ~~assets~~12 ~~and~~months ~~liabilities~~if ~~of Private Escapes, refinanced the credit facility with CapitalSource, and completed the reverse merger with Secure America Acquisition Corporation,~~ we ~~may not~~are besuccessful ~~able to meet certain covenants under the revolving loan agreement~~ in ~~the~~ ~~future.~~executing Weour ~~have~~plans ~~also~~to ~~experienced~~increase aour ~~decrease~~capital ~~in new membership sales and existing member upgrades over the last six months of 2008 and all of 2009~~resources.

~~The above~~We ~~factors~~incurred net losses of $12,965 ~~among~~and ~~others~~$23,222 ~~indicate~~during ~~that~~the weyears ~~may~~ended ~~encounter~~December 31, 2009 and 2008, respectively, and a ~~liquidity~~loss ~~event~~of in$6,472 for the three months ended ~~future~~March ~~which~~31, ~~may~~2010. As ~~cause~~of usMarch to31, be2010, inour ~~default~~current liabilities, excluding $14,020 of deferred annual membership dues that we expect to recognize in income over the next twelve months, were $28,238, which exceeded our ~~loan~~current assets ~~covenants~~of $4,996, excluding restricted cash of $2,890, by $23,242. As of ~~Our~~December ~~management~~31, 2009, our current liabilities, excluding $12,600 of deferred isannual ~~taking~~membership ~~steps~~dues that we expect to ~~increase~~recognize ~~cash~~in ~~flow~~income in ~~order~~2010, towere $31,164, ~~cover~~which ~~2010~~exceeded ~~operational~~our current assets of $6,710, excluding restricted cash ~~expenses~~of $4,343, ~~including~~by $24,454. ~~without~~In ~~limitation~~addition, although we have completed the ~~sale~~acquisition of certain assets and liabilities of ~~selected~~Private ~~club~~Escapes, ~~properties~~refinanced our credit facility with CapitalSource and completed the reverse merger, we may not be able to meet certain covenants under the CapitalSource credit facility in the future. We have also experienced a decrease in new membership sales and ~~closely~~existing ~~monitoring~~member upgrades over the last six months of 2008 and ~~reducing~~throughout ~~operating~~2009 ~~expenses~~and to date in 2010.

~~Total~~The above ~~debt~~factors, ~~outstanding~~among atothers, ~~September~~indicate ~~30,~~that ~~2009 was~~we ~~$125,063~~may ~~compared~~encounter ~~with~~a ~~total~~liquidity event in the ~~debt~~future ~~outstanding~~which atmay ~~December~~cause ~~31,~~us ~~2008,~~ to be in default of ~~$96,765~~our loan covenants. ~~The~~We are taking ~~debt outstanding~~steps atto ~~September~~increase ~~30,~~cash ~~2009 is~~flow ~~primarily~~in ~~the~~order ~~CapitalSource revolving~~to ~~loan~~cover of2010 ~~$102~~operational expenses,~~348~~ including, ~~mortgages~~without limitation, the sale of ~~$12~~selected club properties,~~681~~ and ~~the~~closely monitoring ~~JDI~~and ~~second~~reducing ~~mortgage~~operating ~~of $10,000~~expenses wherever possible.

Total current and long term debt outstanding at March 31, 2010 and December 31, 2009 was $120,118 and $123,279, respectively, compared with $96,765 outstanding at December 31, 2008. The debt outstanding at March 31, 2010 is primarily the amount outstanding under our CapitalSource credit ~~Revolving~~facility ~~Credit~~of ~~Line~~$96,443, a shareholder note payable of $10,000, and various mortgages and other notes payable aggregating $13,675. The debt outstanding at December 31, 2009 is primarily the amount outstanding under our CapitalSource credit facility of $98,982, a shareholder note payable of $10,000, various mortgages aggregating $13,590, as discussed below, and a non-mortgage notes totaling $707.

~~Our amended and restated loan and security agreement with~~ CapitalSource~~, entered~~ ~~into~~Revolving onCredit September 15, 2009, provides for borrowings up to the lesser of a defined maximum amount or a defined borrowing base amount. The maximum amount available is $110 million through December 31, 2009, $108 million from January 1, 2010 through June 30, 2010, $105 million from July 1, 2010 through December 31, 2010 and $100 million from January 1, 2011 to the maturity date of April 30, 2011. The borrowing base amount is a percentage of the appraised value of all owned property encumbered by a mortgage in favor of CapitalSource. Through March 31, 2010, that percentage is 75%, from April 1, 2010 through December 31, 2010 it is 70% and from January 1, 2011 it is 65%.Facility

35Our amended and restated loan and security agreement with CapitalSource, entered into on September 15, 2009, provides for borrowings up to the lesser of a defined maximum amount or a defined borrowing base amount. The borrowing base amount is a percentage of the appraised value of all owned property encumbered by a mortgage in favor of CapitalSource. Through March 31, 2010, that percentage was 75%, from April 1, 2010 through December 31, 2010 it is 70% and from January 1, 2011 it is 65%.

~~Interest~~On April ~~under~~19, 2010, the loan agreement iswas ~~calculated~~amended onto change the ~~actual~~borrowing ~~days~~base ~~elapsed~~to ~~and~~be ~~the basis~~75% ofthrough aJanuary ~~360~~31, ~~day~~2011 ~~year~~(instead ~~and~~of isMarch ~~payable~~31, ~~monthly~~2010), at70% ~~the~~from ~~three-month~~February ~~LIBOR~~1, ~~(approximately~~2011 ~~0.25%~~through atApril ~~January~~30, 12011 (instead of December 31, 2010), ~~plus~~and 5%at ~~per~~all ~~annum~~times after May 1, ~~subject~~2011 tothe aborrowing ~~floor~~base ofwill ~~8.75~~be no greater than 65%. An However, ~~exit~~the ~~fee~~maximum ofloan amount was reduced to $195,093.65 ~~million~~In isaddition, ~~due~~the onrevolving credit ~~maturity~~facility orhas ~~earlier~~minimum ifloan ~~the~~amortization ~~loan~~amounts isthat require cumulative ~~terminated~~amortization ~~for~~of ~~any~~$10,300 ~~reason.~~by ~~The~~June ~~maturity~~30, ~~date~~2010 ~~may~~and be$17,800 ~~extended~~by atDecember ~~our~~31, ~~request~~2010, ~~for~~with ~~two~~the ~~additional~~remaining ~~one~~balance ~~year~~due ~~periods,~~on ~~provided~~April ~~there~~30, is2011 noif ~~default~~we ~~under~~do ~~the~~not ~~loan~~elect an ~~agreement~~extension. If ~~and~~we onelect ~~payment~~a offirst anone-year extension, ~~fee~~then ofcumulative amortization ~~0.25%~~must ofbe ~~the~~$22,800 ~~then~~by ~~maximum~~June ~~loan amount~~30, of2011 and $~~100~~25,300 ~~million.~~by ~~Except~~December ~~for~~31, ~~payments~~2011, with ~~required~~the onremaining ~~the~~balance ~~sale~~due ofon aApril ~~mortgaged property~~30, no2012 ~~principal~~if ~~payments~~we ~~are~~do ~~due~~not ~~until~~exercise ~~maturity~~a onsecond extension. If ~~April~~we ~~30,~~exercise ~~2011~~the second one-year extension, ~~except~~then ~~required~~cumulative ~~cash~~amortization ~~payments~~must ofbe $227,800 ~~million~~by onJune ~~December 31~~30, ~~2009~~2012 ~~(which~~and ~~amount~~$30,300 ~~has~~by ~~been~~December ~~paid)~~31, $32012, ~~million~~with onthe ~~June~~remaining balance due by April 30, 2013. At March 31, 2010 and ~~$5 million on~~ December 31, ~~2010.~~2009, If$96,443 weand $98,982, respectively, was ~~exercise~~outstanding ~~one~~under orthe ~~both~~New Loan Agreement. As part of the ~~extension~~April ~~options~~19, 2010 amendment, the requirement to maintain a segregated restricted cash ~~payments~~balance was removed and we are now required to maintain a cash coverage amount of $5one ~~million~~month’s ondebt ~~each~~service as of June 30, ~~2011,~~2010 ~~December~~through 31September 29, ~~2011~~2010, ~~June~~two months debt service from September 30, ~~2012~~2010 ~~and~~through December 31 30, ~~2012.~~2010, Weand ~~may~~three ~~voluntarily~~months debt ~~prepay~~service ~~any~~after ~~part~~December of30, ~~the~~2010. The ~~loan~~March at31, ~~any~~2010 ~~time~~balance ~~but may~~in ~~terminate~~ the ~~loan~~restricted ~~agreement~~cash ~~only~~account byof ~~providing~~$2,890 30was ~~days~~applied ~~written~~against ~~notice~~the ~~and~~outstanding loan ~~prepaying~~and ~~outstanding~~as ~~amounts~~of inApril ~~full~~19, 2010, the cumulative amortization was $11,211.

~~We are required to meet certain covenants as defined in the loan agreement, including:~~32

•Interest under ~~Maintain~~the ~~either~~loan ~~(1)~~agreement ais ~~restricted~~calculated ~~cash~~on ~~balance~~the actual days elapsed and the basis of ~~not~~a ~~less~~360 ~~than~~day ~~six~~year ~~months~~and ~~debt~~is ~~service,~~payable ormonthly at the three-month LIBOR (2approximately 0.35% at April 30, 2010) aplus ~~debt~~5% ~~service~~per ~~coverage~~annum, ~~ratio~~subject to a floor of 18.2575%. toAn exit fee of $1.~~00,~~65 ~~based~~million onis ~~the~~due ~~ratio~~on ofmaturity ~~Adjusted~~or ~~EBITDA~~earlier ~~for~~if the ~~immediately~~loan ~~preceding~~is 12terminated ~~calendar~~for any ~~months,~~reason. toWe ~~debt~~may ~~service~~voluntarily ~~(excluding~~prepay ~~balloon~~any ~~maturities~~part of ~~indebtedness)~~the onloan aat ~~consolidated~~any ~~basis~~time ~~for~~but may terminate the ~~immediately~~loan ~~preceding~~agreement 12only ~~calendar~~by ~~months;~~providing 30 days written notice and prepaying outstanding amounts in full.

In addition to maintaining the required cash coverage, we are required to meet certain covenants as defined in the loan agreement, including:

•	Remain in compliance at all times with applicable requirements as to the ratio of the number of properties to club members or “equivalent club members”, as set forth in the applicable club membership plans;

•	Maintain a leverage ratio between debt and consolidated tangible net worth of no more than 3.5:1;

• ~~Remain~~For inthe ~~compliance~~year atending ~~all~~December ~~times~~31, ~~with~~2010, ~~applicable~~the ~~requirements~~consolidated asnet toloss ~~ratio~~must ofnot ~~the~~exceed ~~number~~$5 ofmillion ~~properties~~and tofor ~~club~~the ~~members~~year orending ~~“equivalent~~December ~~club~~31, ~~members”~~2011 and each succeeding year, asthe ~~set~~consolidated ~~forth~~net income must not be less than $1 (net loss is adjusted in each year for the ~~applicable~~non-refundable ~~club~~portion ~~membership~~of ~~plans~~new member initiation fees not yet recognized in income); and

• For the years ending December 31, 2009 and 2010, the consolidated net loss must not exceed $10 million and $5 million, respectively, and for the year ending December 31, 2011 and each succeeding year, the consolidated net income must be not less than $1; and

•	The debt ratio (aggregate mortgage financing to the aggregate appraised value for all owned Property) on a consolidated basis must not exceed 80%.

In addition to various covenants, the CapitalSource loan agreement contains customary events of default that would permit CapitalSource to accelerate repayment of amounts outstanding, including failure to pay any amounts outstanding under the loan agreement when due, insolvency, judgment or liquidation, failure to pay other borrowed money in excess of $500,000, failure to comply with the terms and conditions of the loan agreement, suspension of the sale of club memberships, termination of any club or club membership plan, failure to pay (without CapitalSource’s consent) any amounts due to a resigning club member in accordance with the terms of his or her club membership agreement and a change in our management (as defined in the loan agreement).

~~JDI~~Note ~~Second~~Payable ~~Mortgage~~to Shareholder

On April 30, 2007, Ultimate Resort Holdings issued a $10 million note payable to JDI Ultimate, L.L.C. (“JDI”), which at the time was a minority owner inof Ultimate Resort Holdings and is now a minority owner of Ultimate Escapes Holdings. ~~The~~ ~~rights and~~ The obligations of Ultimate Resort Holdings under this ~~loan~~note were subsequently assigned to Ultimate Escapes Holdings, ~~the~~ ~~current~~when ~~borrower~~it ~~under~~assumed the ~~loan. We~~Ultimate ~~refer~~Resort Holdings tooperations, ~~this~~as ~~loan~~discussed asin ~~the “JDI~~Note ~~Second~~2 to our consolidated financial ~~Mortgage”~~statements. ~~The~~ ~~JDI~~On ~~Second~~October ~~Mortgage~~29, ~~has~~2009, aJDI ~~ten~~assigned ~~year~~its ~~term~~interest in the note, ~~with~~as ~~interest~~lender, ~~payable~~to ~~quarterly~~Ultimate atResort 5%Holdings. ~~per~~The ~~annum~~financial ~~and~~terms noof ~~principal~~the ~~payments~~note ~~are due~~remained ~~until~~unchanged. ~~maturity~~At onthe ~~April~~same 30time, ~~2017.~~Ultimate ~~The~~Resort, ~~JDI~~the ~~Second~~majority ~~Mortgage~~owner of Ultimate Resort Holdings, ~~which~~acquired isfrom ~~subordinate to~~JDI the ~~revolving~~minority ~~loan~~interest ~~from~~in ~~CapitalSource,~~Ultimate isResort Holdings ~~collateralized~~held by aJDI. ~~second~~In ~~security~~consideration for the acquisition of the minority interest inand ~~our~~the ~~assets~~transfer, ~~and~~as inlender, ~~certain~~to ~~real~~Ultimate ~~property~~Resort Holdings of the note, JDI received 3,123,797 ownership units of Ultimate Escapes Holdings.

36The note has a ten year term, with interest payable quarterly at 5% per annum and no principal payments are due until maturity on April 30, 2017. The note, which is subordinate to the revolving loan from CapitalSource, is collateralized by a second security interest in our assets and in certain real property.

OnOther ~~October 29, 2009, JDI released Ultimate Resort from its obligations under the JDI Second~~ Mortgage (the obligations under which had been assigned to Ultimate Escapes Holdings), and concurrently assigned its interest in the JDI Second Mortgage, as lender, to Ultimate Resort. The financial terms of the note remain unchanged. At the same time, Ultimate Resort re-acquired from JDI the minority interest in Ultimate Resort held by JDI. In consideration for the re-acquisition of the minority interest and the transfer, as lender, to Ultimate Resort of the JDI Second Mortgage, JDI received 3,123,797 ownership units of Ultimate Escapes Holdings.Loans

~~Kederike~~At March ~~Loan~~31, ~~Agreement~~2010 and December 31, 2009, we have other mortgage loans, aggregating $13,675 and $13,590, respectively, which we acquired when Ultimate Escapes Holdings acquired certain assets and liabilities of Private Escapes. These mortgages are held by a number of mortgage providers and individuals and carry interest rates ranging from 3.4% to 15.0%. Certain of the mortgages are due within twelve months and, where possible, we are seeking to extend or renew these mortgages.

Private Escapes Pinnacle, LLC, a subsidiary of Private Escapes (which was acquired by Ultimate Escapes on September 15, 2009), borrowed $3.75 million from Kederike, LLC, an entity in which Richard Keith, our Chairman, is a 50% owner, pursuant to a loan agreement dated June 1, 2006, as subsequently amended. The loan proceeds were used to pay a portion of the purchase price for the acquisition of four properties. Interest accrues on the loan at a rate equal to 1.5% above the interest rate applicable to the primary bank loan financing the acquisition of the properties. In addition, Kederike was paid a loan fee of $250,000 that was earned upon origination, has been paid loan extension and similar fees totaling $86,806, and is entitled to receive, upon the earlier of the sale of a property or the request of Kederike commencing three years after the acquisition of the property, 50% of the then-current fair market value of the property, less (i) the original purchase price of the property and (ii) 2.5% of such fair market value. Upon the consummation of the acquisition of Private Escapes by Ultimate Escapes on September 15, 2009, Ultimate Escapes assumed liability for $234,000 of the remaining $936,000 outstanding principal balance of the loan; the remainder was assumed by an entity controlled by Mr. Keith. The maturity date of the loan was October 15, 2009; however, the parties are in the process of negotiating an extension of the maturity date.33

~~Nine~~Included ~~Months~~in ~~Ended~~these ~~September~~mortgage 30loans is $234 of the remaining outstanding principal balance of $936 related to a $3.75 million loan from Kederike, ~~2009~~LLC, ~~Compared~~an ~~with~~entity in which Richard Keith, our Chairman, is a 50% owner. The original loan proceeds were used to pay a portion of the ~~Nine~~purchase ~~Months~~price ~~Ended~~for ~~September~~the acquisition of four properties. Ultimate Escapes Holdings assumed $234 of the remaining outstanding principal balance when it acquired Private Escapes. The remainder of the outstanding principal balance of $702 was assumed by an entity controlled by Mr. Keith. Interest accrues on the loan at a rate equal to 1.5% above the interest rate applicable to the primary bank loan financing the original acquisition of the properties. The maturity date of the loan was October 15, 2009; however, the parties have negotiated an extension of the maturity date until June 30, ~~2008~~2010 ~~(in~~on ~~thousands)~~substantially ~~(unaudited)~~the same terms.

Three Months Ended March 31, 2010 Compared with the Three Months Ended March 31, 2009 (in thousands)

Operating Activities

Net cash used by operating activities during the ~~nine~~quarter ~~months~~ ended ~~September~~March 3031, ~~2009~~2010 was $1(489),~~724,~~ compared with net cash provided of $~~1,871~~76 for the same period in ~~2008~~2009. This decrease in cash from operating activities of $~~3,596 when~~565 ~~comparing~~reflects ~~the~~an ~~two~~increase ~~periods~~of ~~was benefited by a~~ $155,~~273~~248 ~~decrease~~ in our net loss, from net loss of $(181,~~498~~224) in ~~for~~2009 ~~the~~to ~~nine~~a ~~months~~net ~~ended~~loss ~~September~~of ~~30, 2008 to~~ $(36,~~225~~472) ~~for~~in ~~the nine months ended September 30~~2010, ~~2009. Cash~~offset ~~usage~~by ~~when~~a ~~comparing~~net ~~the~~increase ~~two periods~~of ~~was impacted~~ $131,~~683~~139 ~~by the change~~ in ~~membership dues related to the~~ ~~assessment, a one~~non-~~time~~cash ~~fee~~charges ~~subject~~ to ~~approval~~income byin 2010, and a ~~majority~~net change of ~~members~~$3,544 ~~if required~~ in ~~the~~our ~~future~~current assets ~~with~~and ~~the~~liabilities ~~nine~~and ~~months~~other ~~ended~~membership ~~September 30~~receivables, ~~2009~~primarily ~~totaling~~reflecting ~~$91~~lower ~~compared~~membership toreceivable ~~$13,774 for the nine months ended September 30, 2008~~balances. ~~Other~~The ~~working~~decrease ~~capital~~in ~~changes~~net ~~for the nine months ended~~income ~~September~~primarily ~~30,~~reflects ~~2009 compared with~~ the ~~same~~2009 ~~period~~benefit inof ~~2008~~the ~~were~~ $23,~~600~~036 ~~less reduction~~membership inspecial ~~restricted cash~~assessment, which ~~$1,918~~was ~~more~~not inrepeated ~~member receivables, and $1,625 reduction~~ in ~~accounts payable~~2010.

Investing Activities

Net cash of $2,~~159~~749 was provided by investing activities during the ~~nine~~quarter ~~months~~ ended March ~~September~~31, ~~30,~~2010 ~~2009~~ compared with $~~1,049~~3 for the same period in ~~2008~~2009, ~~a reduction~~an ofincrease of $12,~~110~~746, due primarily to the sale of properties. There were no acquisitions of properties during the ~~nine~~periods ~~months~~ ended ~~September~~March 3031, 2010 or 2009 and limited capital expenditures in 2010 of $73 194 compared with ~~$1,778~~none for the same period in ~~2008~~2009.

Financing Activities

Net cash ~~provided~~used byto ~~financing~~repay ~~activities~~debt was $~~172~~3,161 during the ~~nine~~quarter ~~months~~ ended ~~September 30~~March 31, ~~2009~~2010, an increase of $92,~~165~~783 compared with ~~cash~~repayments ~~used in financing activities~~ of $~~8,993~~378 for the ~~nine~~same ~~months~~period ~~ended September 30, 2008. There were no borrowed amounts~~ in ~~the first nine months of 2008 compared to $3,440 borrowed in the same~~ ~~period of~~ 2009. ~~The~~ In ~~CapitalSource fixed rate term loan was paid down $5~~2010,~~263~~ ~~for~~ the ~~nine~~source ~~months~~of ~~ended~~cash ~~September~~used ~~30, 2008 and $378~~ for ~~the~~these ~~same~~repayments ~~period in 2009. The CapitalSource revolving loan~~ was ~~paid down $2,890 in the nine~~ ~~months~~primarily ~~ended September 30, 2008, and $2,196 for~~ the ~~same~~sale ~~period~~of ~~in 2009~~properties.

37Year Ended December 31, 2009 Compared with the Year Ended December 31, 2008 (in thousands)

Year Ended December 31, 2008 compared with the Year Ended December 31, 2007 (in thousands)

Operating Activities

Net cash ~~provided~~used by operating activities during ~~2008~~the ~~was~~year ended December 31, 2009 was $1(2,~~273~~851), compared with net cash provided ~~by operations~~ of $61,~~433~~163 infor ~~2007,~~the asame period in 2008. This decrease in cash ~~provided~~from by operating activities of $54,~~160.~~014 ~~The~~when comparing ~~change~~the two periods was benefited by a $10,257 decrease in net loss, from $(23,222) for the ~~result~~year ofended ~~several~~December ~~items~~31, ~~with~~2008 to $(12,965) for the year ended December 31, 2009. Cash usage when comparing the ~~primary~~two ~~reason~~periods ~~being~~was impacted $18,608 by the ~~increase~~change in ~~club~~ membership fees and ~~member~~dues ~~deposits~~not inyet recognized, ~~2007~~which was related to the acquisition of ~~$36~~Private Escape memberships. Other working capital changes for the year ended December 31,~~035~~ ~~compared~~2009 compared with the same period in 2008 were $122,~~221~~335 less reduction in ~~2008~~restricted cash, a$3,784 more ~~decrease~~in ofmember receivables, and $231,~~814~~973 ~~offset~~increase byin accounts payable and $714 for ~~significant~~the ~~changes~~RAP inexchange ~~restricted~~inducement ~~cash~~expense.

Investing Activities

Net cash ~~provided~~of ~~by investing activities increased by~~ $63,~~929,~~100 towas ~~$1,042~~provided ~~during~~by ~~2008, from~~investing ~~($5,887)~~activities during ~~2007.~~the Inyear ~~2008,~~ended ~~purchases of property and equipment were~~December $131,~~959,~~ 2009 compared with $101,~~527~~041 infor ~~2007,~~the ~~resulting~~same inperiod ~~a decrease~~ in ~~cash~~2008, ~~provided by~~an ~~investing~~increase ~~activities~~ of $82,~~569~~059. There ~~During~~were ~~2007,~~no weacquisitions ~~purchased~~of ~~club~~ properties ~~for approximately~~during ~~$105,000,~~the ~~financing $95,000 with long-term debt and $10,000 of~~year ~~cash.~~ended InDecember ~~2008~~31, we2009 ~~purchased~~and ~~club~~limited ~~properties~~capital ~~for~~expenditures ~~approximately~~of $~~15,100,~~495 ~~financing $10,871~~compared with ~~long-term debt and~~ $21,~~700~~959 offor ~~club~~the ~~memberships,~~same ~~and~~period ~~$1,529~~in ~~of cash~~2008.

Financing Activities

Net cash ~~used~~provided inby financing activities ~~increased~~was by $91,~~406,~~532 ~~to $9,383~~ during ~~2008, from $(23) during 2007. This increase was primarily due to~~ the ~~small~~year ~~amount~~ended ofDecember ~~owner~~31, ~~capital~~2009, ~~raised~~a inchange ~~2008~~of $10,915 compared with ~~$11,846~~cash ~~raised~~used in ~~2007,~~financing ~~additional repayments~~activities of $9,383 ~~debt~~for ~~net~~the ofyear ~~borrowings,~~ended ~~and~~December ~~the $2~~31,~~643~~ ~~loan~~2008. The ~~costs~~material source ~~incurred~~of incash ~~2007 related~~from tofinancing ~~the~~was ~~CapitalSource~~provided ~~Loan~~by ~~Agreement~~the ofreverse ~~April,~~merger ~~30,~~with ~~2007~~Ultimate Escapes Holdings.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

Unaudited Operating Results using ~~Pro Forma~~ Adjusted GAAP Revenue Recognition and Adjusted EBITDA (in thousands)

We use an adjusted revenue calculation as an integral part of our internal financial management reporting and planning process, based on adjusted GAAP revenue recognition. ~~The~~For this purpose, the non-refundable club membership initiation fee is recognized over the first 18 months of membership, with the remaining club membership fee amortized over ten years, rather than the full amount of the club membership fee (including the non-refundable portion) being recognized over the ten-year expected life of the club membership, as is reflected in our ~~audited~~ condensed consolidated financial statements. for the three months ended March 31, 2010. Club members cannot resign within the first 18 months of membership. Because the club member initiation fee is non-refundable, we we believe that treating such non-refundable initiation fee as earned over that 18 18 month minimum membership contract period better reflects the ~~actual performance~~current performance of our business and the actual contractual terms of our club membership plan.

~~Adjusted~~We also measure performance based on Adjusted EBITDA, which is the metric used to determine the UE Owners earn-out units as described in Note 2 to our condensed consolidated financial statements for the three months ended March 31, 2010. Adjusted EBITDA with respect to any period, ~~includes~~means, ~~organic~~as determined ~~growth~~in ~~and~~accordance with GAAP, the ~~effect~~difference ~~of any~~between ~~acquisitions~~our orrevenues ~~dispositions~~(plus the ofnon-refundable ~~lines~~portion of ~~businesses~~membership orfees ~~other~~to ~~material~~the ~~assets~~extent such membership fees are not included in revenue pursuant to GAAP) and ~~all~~our ~~member~~expenses, ~~assessments~~on ~~incurred~~a consolidated ~~during~~basis ~~the~~for such period, ~~for which~~plus ~~Adjusted EBITDA~~the issum ~~being~~of ~~calculated~~(i) interest expense, (ii) income tax expense, (iii) depreciation expense and (iv) amortization expense but (v) ~~excludes~~excluding all non-cash compensation related to ~~the~~ our 2009 Stock Option Plan and our previous employee stock-based compensation plan.

	Nine months ended
	GAAP Financial Information			Adjusted GAAP Revenue Recognition
	September 30, 2009
	(in thousands)
	Historical Financial Information			Adjusted GAAP Revenue Recognition(2)
Total Revenues	$	7,315		$	7,315
	(In thousands)
Add:
Total revenues	$	25,061		$	35,337
Non-GAAP revenue accretion					974
EBITDA(1)	$	6,999		$	17,600
Adjusted Non-GAAP Revenue				$	8,289
Net income (loss)	$	(3,225	)	$	4,465

(1)	For purposes of calculating earn-out shares issuable pursuant to the acquisition of Secure America Acquisition Corporation, Adjusted EBITDA excludes all non-cash compensation related to the 2009 Stock Option Plan.
(2)	Pro Forma Adjusted GAAP Revenue Recognition assumes the Private Escapes transaction occurred on January 1, 2009.

	GAAP Financial Information			Adjusted EBITDA
	(in thousands)
Net Loss	$	(6,472	)	$	(6,472	)
Add:
Non-GAAP revenue accretion		-			974
Adjusted loss		(6,472	)		(5,498	)
Add:
Non-cash stock-based compensation					53
Interest expense		3,004			3,004
Taxes		20			20
Depreciation and amortization (1)		2,265			2,265
EBITDA	$	(1,183	)
Adjusted EBITDA				$	(156	)

(1) Depreciation includes the impairment charge on assets held for sale.

BUSINESS

We operate a family of luxury destination club offerings, including Elite ~~ClubTM,~~Club TM , Signature ~~ClubTM~~Club TM and Premiere ~~ClubTM,~~Club TM , with over 1,200 affluent club members~~, as well as an experienced management team and increasing market share~~. We provide club members and their families with flexible access to a growing portfolio of multi-million dollar club residences, exclusive member services and resort amenities. We believe that we offer our club members access to more club destinations than any other luxury ~~destination~~ destination club in the world, with over ~~130~~140 luxury club residences in 45 global destinations available ~~today~~ in the mainland United States and Hawaii, Mexico, ~~Central~~ Central America, the Caribbean and Europe as of December 31, 2009. Elite Club properties target approximately $3 million in value, Signature Club properties target approximately $2 million in value and Premiere Club properties target approximately $1 million in value. As of December 31, 2009, we had ~~433~~ 433 Elite Club members, ~~345~~ ~~Signature~~545 Signature Club members and 236 Premiere Club members. The majority of the properties are owned by us, and the others are leased on either a long or short term basis. All of the properties owned by us are subject to one or more mortgages. Of the 3237 properties leased by us as of December 31, 2009, 6 27 were subject to long-term leases and 26ten were subject to short-term leases (including two short-term leases in which Private Escapes Holdings, LLC (“PE Holdings”), an affiliate of ours, is the lessor).

We combine the privacy and intimacy of multi-million dollar residences in a wide variety of global resort destinations with “white glove” member concierge services and club amenities. Our management believes that we offer a unique and compelling value proposition that is a cost effective vacation alternative for a large, affluent target market that Spectrem Group estimates at year end 2008 included approximately 6.7 million “millionaires” in the United States with assets of at least $1 million and approximately 840,000 “pentamillionaires” in the United States with assets of at least $5 million. For the consumer market, a club membership offers a more flexible, ~~energy~~ efficient and cost effective ~~vacation~~ vacation alternative as compared with the high costs, inefficiencies and hassles of of second home ownership in this cost range, the expense, uncertainties and time-consuming effort to rent luxury villas in the United States and international markets or the high costs and typical small rooms of luxury hotels. For the corporate market, our corporate membership option targets the growing multi-billion dollar corporate reward and incentive market, and offers corporations an affordable, flexible corporate reward and incentive program for top performing employees, senior executives, board members, key advisors, existing customers and new prospects.

In addition to providing club members with flexible access to a ~~growing~~ portfolio of over 140 ~~130~~ luxury club residences in 45 global destinations as of December 31, we2009, we provide our club members with preferred access to over 140 four and five-star ~~hotel~~ hotel properties and resorts affiliated with The Ultimate ~~CollectionTM,~~Collection TM , offering club members access to hundreds of beach, mountain, golf, ~~metropolitan~~ metropolitan and leisure club properties in world-class resorts and destinations ~~throughout~~ throughout the world. With multiple club offerings and various club membership levels in each club, we believe that we have the widest market appeal in the ~~destination~~ destination club industry.

Club members join us by paying a one-time, membership fee (similar to a golf club membership) currently ranging from $70,000 to $450,000, depending on the club level and membership usage plan. Club members also pay annual dues currently ranging from $8,000 to $49,000 per year, again based on the corresponding club level and membership usage plan. In addition to annual dues, additional revenues are derived from upgrades, additional use fees and reciprocity fees from third party operations. IfAs currently structured, if a club member resigns from the club, his or her club membership is redeemed on a three-in, one-out basis, which means that three new club members must join the club before a current club member who desires to resign from the club will have his or her club membership redeemed. Such redeemed club member typically receives 80% of the club membership resale proceeds with us retaining a 20% transfer fee. This redemption mechanism is common in private country clubs and has also been adopted by most ~~destination~~ destination clubs.

We also offer an Ultimate ~~DiscoveryTM~~Discovery TM “trial membership” whereby qualified club prospects or club member referrals can purchase a seven-day “mini-vacation package” for an average of $3,500 and experience the club as an authorized guest at one of our club properties within six months of purchasing an Ultimate Discovery trial membership. If the trial member purchases an Ultimate Escapes lifetime membership within 30 days of completing the Ultimate Discovery vacation experience, then 100% of the fee paid for the Ultimate Discovery trial membership is applied toward the purchase of the lifetime membership.

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In 2008, we launched the Ultimate Reciprocity ~~ProgramTM,~~Program TM , an affiliate club membership reciprocity program targeting a growing market estimated by Ragatz Associates to consist of approximately 50,000 fractional and private residence club owners at hundreds of private residence clubs and luxury fractional ownership resorts in the United States, Mexico, Central America, the Caribbean and Europe. The Ultimate Reciprocity Program offers participating luxury resorts the opportunity to offer their shared-use owners an affiliate club membership that provides annual reciprocity access to our global club properties, affiliate member services and club amenities; this program provides owners at participating luxury resorts with reciprocal access to over ~~130~~140 club properties offered by us in the continental United States, Hawaii, Mexico, Central America, the Caribbean and Europe. Participating resort developers sign multi-year reciprocity agreements with us and pay an upfront affiliate resort developer fee ~~of $50,000 to $100,000,~~ depending on resort size. In addition, participating resorts pay a one-time affiliate member fee of $3,000 for each shared-use owner that participates at each affiliated resort, which fee ~~includes~~ includes the affiliate club member’s first year annual dues. Affiliate club members also pay us a $250 transaction fee for each reciprocity transaction executed within our reservation system, and each affiliate club member continues to pay its affiliate member annual dues beginning in the second year of its affiliate club member reciprocity agreement with us.

Participating developers and shared-use owners contribute up to two weeks per year of participating shared-use ownership inventory into our proprietary web-based reservation system, providing over 1,200 club members with additional benefits, including expanded access to new destinations and affiliated resorts generally at no additional cost. The Ultimate Reciprocity Program also provides participating luxury resort developers with custom-designed websites developed and hosted by us that offer affiliate resort developers and their club members online information about our destinations, club properties, affiliate member services and on-line availability, leveraging our advanced web-based technology platform.

Participating resorts have access to a variety of our reciprocity services designed to help improve developer real estate sales performance, owner retention and owner referrals. Additionally, we offer participating resorts an opportunity to differentiate their shared ownership offerings from other non-affiliated resorts, helping to increase participating resort developer’s sales and maintain higher price points. To participating resort developers, bundling the Ultimate Reciprocity ~~Program~~ Program with luxury shared ownership real estate creates a unique “hybrid” offering that greatly expands the number of luxury resort destinations and club properties that affiliate club members can ~~now~~ book reservations and travel to ~~at more than 130 Ultimate Escapes club properties in 45 global destinations~~.

Resorts that participate in the Ultimate Reciprocity Program receive increased market exposure from a base of over 1,200 affluent club members and their family and friends, some of whom also explore purchasing additional vacation real estate while traveling to club destinations. In addition, participating resorts benefit from reciprocal reservations booked by our club members and their guests, who on average spend between $5,000 and $10,000 per vacation on food, drinks, golf, spa, entertainment and shopping when traveling to various club properties and affiliated properties.

The destination club industry has gone through dramatic changes and a period of rapid consolidation over the last few years, which has led to fewer, larger destination clubs that have achieved operating efficiencies as a result of scalable, sustainable business models, experienced management teams, strong capital bases, financial transparency and affordable access to high quality club member services in the wide variety of global destinations.

We believe that the two largest clubs in the industry, as measured by numbers of ~~club~~ members, are Exclusive Resorts and usour company, with a combined 82% global ~~market~~ market share in the destination club industry, as noted in the chart below, which shows the number of club members in various destination clubs and market share, based on industry data available to us as of ~~December~~ December 2009.

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We were structured to be more affordable than other luxury consumer vacation travel options and business incentive travel options, including second home ownership, while simultaneously offering equal or superior benefits (especially for anyone requiring flexible access to private homes with multiple bedrooms for friends and family). For individual club members, we eliminate the burdens of owning one or multiple second homes and the uncertainties and expense of renting different homes or villas in multiple United States and international markets. For corporations, we offer a more affordable, flexible corporate reward and incentive program for top performers, key advisors, key employees and important customers and prospects.

We operate a proprietary occupancy model that provides club members with flexible access and reasonable availability, principally by maintaining a low 6-to-1 equivalent member-to-property ratio and purposely under-utilizing each club property, targeting annual club occupancy of 75% or less. An equivalent ~~Club~~member ~~occupancy~~is ~~was~~a ~~57% for~~member ~~all~~who ~~club~~has ~~properties~~a ~~during~~60 ~~2008~~day annual plan. For all club properties, ~~and~~occupancy was 6157% ~~for~~during ~~all~~2008 ~~club~~and ~~properties~~61% during 2009. We charge a one-time membership fee to join the club that we believe is generally lower than the typical down payment for a single second home property, and charge annual dues that are generally a fraction of the cost of owning and operating a single $1 – $3 plus million second home.

We have focused on the creation of a unique brand supported by a valuable portfolio of luxury properties in some of the world’s premier resort and urban destinations. These luxury properties target the affluent family vacationer. We believe that this affluent segment is particularly well-positioned for future growth.

We differentiate ourselves from our competitors with the widest offerings in the destination club industry, with multiple clubs each offering five tiers of club membership plans. The breadth of this offering provides our club members with multiple upgrade paths, both in terms of use rights and club levels. Our club membership provides club members with internal reciprocity use within all club properties, which in some cases requires a nightly reciprocity fee for members in Premiere Club or Signature Club to reserve residences in more expensive clubs (for example, Premiere Club members reserving Elite Club residences through internal reciprocity). The flexibility allows club members to grow and change with the club, while providing incremental revenues streams to us.

James M. Tousignant, the founder of Ultimate Resort and our President and Chief Executive Officer, and Richard Keith, the founder of Private Escapes and our Chairman, along with many other members of our management team, have worked together for many years and have over 100 years of collective experience building and managing public and private companies.

History

We were formed on May 14, 2007, as a blank check company for the purpose of acquiring, or acquiring control of, through a merger, capital stock exchange, asset acquisition, stock purchase or other similar business combination, one or more domestic or international operating businesses. We changed our name from “Fortress America Acquisition Corporation II” to “Secure America Acquisition Corporation” on August 6, 2007 and on October 29, 2009 changed our name to “Ultimate Escapes, Inc”.

41On October 29, 2009, we consummated a business combination with Ultimate Escapes Holdings, pursuant to a Contribution Agreement dated September 2, 2009, by and among us, Ultimate Escapes Holdings, Ultimate Resort Holdings and James M. Tousignant, in his capacity as the representative of the holders of the issued and outstanding ownership units of Ultimate Escapes Holdings and Ultimate Resort Holdings (the “Owner Representative”), as amended by Amendment No. 1 dated as of October 28, 2009 (the “Contribution Agreement”). Although we legally acquired Ultimate Escapes Holdings and it became our subsidiary, for accounting purposes, the business combination with Ultimate Escapes Holdings was accounted for as a reverse merger, whereby Ultimate Escapes Holdings is the continuing entity for financial reporting purposes and is deemed, for accounting purposes, to have acquired us.

On October 29, 2009, we consummated the Acquisition of Ultimate Escapes Holdings, pursuant to a Contribution Agreement dated September 2, 2009, by and among us, Ultimate Escapes Holdings, Ultimate Resort, and James M. Tousignant, in his capacity as the representative of the holders of the issued and outstanding ownership units of Ultimate Escapes Holdings and Ultimate Resort (the “Owner Representative”), as amended by Amendment No. 1 dated as of October 28, 2009, whereby Ultimate Escapes Holdings became our subsidiary.39

~~Pursuant~~In toaccordance ~~the~~with ~~terms of~~ the Contribution Agreement, we received 1,232,601 ownership units of Ultimate Escapes Holdings. The UEowners ~~Owners~~of ~~retained~~Ultimate Escapes Holdings prior to the reverse merger, consisting of Ultimate Resort Holdings, PE Holdings and JDI retained the remaining 7,556,675 ownership units of Ultimate Escapes Holdings, which, under the terms of the Operating Agreement ~~of Ultimate Escapes Holdings~~ may be converted on a one-to-one basis into shares of our common stock. These 7,556,675 ownership units are held as follows: 3,858,571 units by Ultimate Resort Holdings, 3,123,797 units by JDI and 574,307 units by PE Holdings. Of such retained units, 717,884 units were deposited into escrow at the closing of the reverse ~~Acquisition~~merger to secure the indemnification obligations of the UE Owners to us. Additionally, the UE Owners are eligible to receive up to an aggregate of 7,000,000 additional ownership units of Ultimate Escapes Holdings, convertible on a one-to-one basis into shares of our common stock, upon the achievement by us of certain Adjusted EBITDA milestones, as set forth in the Operating Agreement. ~~For~~ ~~each~~For each ownership unit of Ultimate Escapes Holdings issued to the UE Owners, the Owner Representative also received one share of our Series A Voting Preferred Stock. At any time that any UE Owner exchanges ownership units of ~~Ultimate~~ Ultimate Escapes Holdings for shares of our common stock, a like number of shares of Series A Voting Preferred Stock will be canceled. Upon consummation of the reverse ~~Acquisition~~merger, Ultimate Escapes Holdings became our subsidiary, and the business and assets of Ultimate Escapes Holdings and its subsidiaries are our only operations.

Ultimate Escapes Holdings was founded in 2004, as Ultimate Resort, ~~LLC,~~ by Mr. Tousignant to to address what he perceived was an emerging and underserved segment of the ~~luxury~~ luxury shared-use market — the high-end “luxury destination club.” Mr. Tousignant has over 20 years of management experience, including with entrepreneurial ventures and public companies.

Since its inception in 2004, Ultimate Resort ~~rapidly~~ grew rapidly to become one of the largest players in the destination club industry. Recognizing that achieving “critical mass”, which it viewed as having at least 800 to 1,000 club members, is a key component to operating a successful destination club business model, Ultimate Resort aggressively pursued a two-tiered growth strategy of organic growth combined with strategic transactions to reach critical mass quickly.

In May 2007, Ultimate Resort Holdings acquired all of the assets and business of its ~~parent~~ parent company, Ultimate Resort, ~~LLC,~~ and purchased certain real estate assets for approximately $105 million in federal bankruptcy court as a result of the 2006 bankruptcy of Tanner & Haley. To finance the acquisition of the real estate assets, ~~Ultimate Resort obtained~~ secured debt financing was obtained from CapitalSource Finance, a NYSE-listed specialty lender. In addition, ~~Ultimate Resort separately signed~~ new club membership agreements were signed with 645 previous Tanner & Haley club ~~members~~ ~~who elected to become new club~~ members ~~of Ultimate Resort~~. In February 2008, additional ~~Ultimate Resort purchased certain~~ real estate assets were purchased for $12 million from ~~Ventures~~ Ventures Equity Vacation Club. Inand ~~addition, Ultimate Resort separately signed~~ new club membership agreements were signed with 19 previous club members of Ventures Equity Vacation Club ~~who elected to become new club members of Ultimate Resort~~.

In May 2008, Ultimate Resort Holdings signed a cooperative marketing agreement and a ~~definitive~~ definitive contribution agreement to acquire certain assets and assume certain ~~liabilities~~ liabilities from Private Escapes, including ~~acquiring 49 new~~ club properties ~~with recent appraised values~~ of approximately $50 million., ~~The 49 Private Escapes’ properties acquired by Ultimate Resort are~~ located in 28 beach, mountain, golf and metropolitan destinations throughout the continental United States, Hawaii, Mexico, Central America, the Caribbean and Europe. ~~Also in May 2008, Ultimate Resort began operating its business under the “Ultimate Escapes” brand name. Ultimate Escapes Holdings completed the acquisition of a majority of the assets of~~ Private Escapes ~~on September 15, 2009. Private Escapes~~ was founded by our Chairman, Richard Keith, in 2003 and became a market leader at the one million dollar home entry level category and, over several years of operations, became the industry’s third largest destination club as measured by number of club members, according to HalogenGuides. Also in May 2008, Ultimate Resort Holdings began operating its business under the “Ultimate Escapes” brand name.

42On September 15, 2009, Ultimate Resort Holdings contributed all of its assets and liabilities to Ultimate Escapes Holdings and, on the same date, Ultimate Escapes Holdings completed the acquisition of a majority of the assets of Private Escapes. On October 29, 2009, we completed the reverse merger business combination with Ultimate Escapes Holdings.

Prior to the Acquisition, we incurred net losses of $3.2 million, $23.2 million and $24.6 million during the nine months ended September 30, 2009 and the years ended December 31, 2008 and 2007, respectively. We had also experienced a decrease in new club membership sales and existing club member upgrades during the last six months of 2008 and all of 2009. These circumstances raised substantial doubt about our ability to continue to fund operating losses and provide necessary operating liquidity.40

Industry Overview

Luxury destination clubs first started to appear in the market in 1999 and since then have become the second largest segment of the $1.5 billion luxury shared-use vacation market in 2008, according to Ragatz Associates. The luxury shared-use vacation market includes destination clubs, traditional fractional interests and private residence clubs. Destination clubs differ from traditional fractional interests and private residence clubs in a number of ways. The destination club and fractional industry business models are fundamentally based on the purchase of either a deeded real estate interest (timeshare/fractional) or some form of member use right to access a collection of various club properties and destinations (destination club). Within the fractional and destination club umbrella, there are a variety of approaches, classified into the following three categories:

• Traditional Timeshare Interval Week Ownership — The consumer purchases a deeded real estate interest to a specific week at a specific resort. This specific week purchased may then be exchanged through internal and/or external exchange systems (such as RCI LLC or Interval, ~~discussed~~Leisure ~~below~~Group, Inc.), either for a different interval week from another owner or, in some cases, for an exchange credit. The traditional timeshare product structure has been successful with low-to-medium income consumers, but has not been a preferred choice by high-income, affluent consumers looking for a luxury vacation experience, and, in our view, is not a competitive offering for affluent consumers, as compared to new luxury vacation lifestyle products like destination clubs being introduced to the market. Timeshare units are generally smaller (1 – 2 bedroom, 1,200 square feet), with modest furnishings and finishes and are generally thought to be over-priced, hard to resell by owners and less flexible from the consumer’s point of view.

•

Fractional Ownership/Private Residence Clubs — Similar to the traditional timeshare interval week system, the fractional or private residence club owner typically purchases a higher quality fractional unit that generally provides a larger deeded fractional interest, typically a one-sixth, one-tenth or one-twelfth deeded ownership interest in a particular fractional unit. Originally started in and around seasonal ski areas, this product’s pricing and use structure is generally based on seasonal usage patterns and owner use is typically planned nine to twelve months in advance.

• Destination Club Membership — Destination clubs generally offer non-equity, right-to-use club memberships that are structured more like membership in a private country club. Destination clubs sell club memberships that enable a club member to use the club’s homes, amenities and club member services for a specified amount of time, typically two to six weeks per year. They also provide their club members with access to fully furnished, luxury one to six bedroom residences in any of the club’s portfolio of residences. In addition, destination clubs typically provide many of the amenities of a luxury five-star hotel, including personal concierge services and access to private beaches, spas, golf courses, ski resorts and yacht clubs. Destination ~~Clubs~~clubs have grown to $349 million in annual revenue in 2008, according to Ragatz Associates, appealing to affluent club members who have exclusive use of a growing portfolio of beautiful club homes, easy and flexible access, reasonable long-term value and a superior level of member services and resort amenities.

Market Drivers and Industry Outlook

Low-end timeshare offerings and high-end destination club offerings (as well as fractional interests and private residence clubs), both generally appeal to growing consumer demand for cost effective, flexible “shared-use” vacation travel alternatives. The vast majority of timeshare owners participate in vacation exchange networks like RCI LLC (a subsidiary of Wyndham Worldwide Corp.) and Interval Leisure Group, Inc., that allow timeshare owners the opportunity to exchange their timeshare weeks in their “home” resort for exchange use in other affiliated timeshare resorts, creating an expanded range of vacation experiences for timeshare owners. Wherever they vacation, timeshare owners know that they can “leave the keys” and go home after one to two weeks of vacation without the hassles and expenses of owning a one or two bedroom vacation condo and having to fund the annual operating costs and maintain the vacation property all year round. Destination club members generally join a club to avoid the costs and hassles of luxury second home ownership, as well as enjoy the flexibility to be able to travel to various club properties in a growing number of desirable luxury resort destinations, bundled with full concierge services and member services every year they remain a club member.

According to Northcourse, Inc., a leisure real estate consulting firm, 75% of income-qualified households in the United States have not yet purchased any type of second vacation home. Northshore suggests the reason for this behavior may be directly related to the costs of second homes and the fact that second home owners typically use second homes only three to four weeks per year. Destination club members, unlike second home owners, do not experience the large upfront costs, annual costs and ownership hassles associated with owning one or multiple second homes.

Destination club memberships and timeshares units are generally purchased by the same age demographic — the “baby boomer” generation. According to recent club member surveys, over 70% of our club members are between the ages of 45 – 64. According to ARDA (American Resort Developers Association), baby boomers born between 1946 – 1964 make up 55.2% of all timeshare owners; individuals born between 1925 – 1945 account for an additional 22.9% of timeshare ownership. According to ARDA, the average age of timeshare owners today is 52 years old.

The real difference between the typical destination club member and the typical timeshare owner is in their level of income and financial net worth. According to ARDA, the average annual income of timeshare owners is less than $100,000 and the average net worth of timeshare owners is also less than $100,000. In our recent club member survey, the club members responded that over 50% have annual incomes ranging from $250,000 to $5 million per year and more than 50% of club members have a net worth greater than $5 million.

According to the Joint Center for Housing Studies at Harvard University (“JCHS”), in 2004, there were about 11 million households in the top tenth percentile of incomes, i.e., incomes of greater than $129,000 per year. Of this group, only 37% owned vacation or investment residential property (second homes, timeshares, one-to-four family rental properties, and other types of residential properties). The age groups with the largest share in owning other residential property were 16.3% of families with household head age of between 45 – 54 years old, 19.5% of families with household head age of between 55 – 64 years old, and 19.9% of families with household head age of between 65 – 74 years old.

The affluent population is increasing in both annual income and net worth, driving demand for high-end, luxury vacation alternatives. According to JCHS, in their 1995 and 2004 Survey of Consumer Finances, net worth increased for all groups but increased at a much faster rate for households in the top quartile of the population. Wealth also notably jumped for households with heads of households in the 50 – 59 age groups and 60 – 69 age groups.

At the very high end of the affluent population, Spectrem Group, a consulting and market research firm specializing in affluent and retirement markets, estimates that there are approximately 6.7 million “millionaires” (high net worth individuals with investable assets between $1 and $5 million, excluding housing) and roughly 840,000 “pentamillionaires” (very high net worth individuals with investable assets from $5 to $30 million, excluding housing).

The increasing wealth of “baby boomers,” coupled with the desirability of shared-use vacation alternatives, bodes well for continued destination club growth over many years, particularly given the low 1% market penetration of qualified buyers of luxury share-use vacation offerings, according to Ragatz Associates. If destination clubs are able to achieve the same market penetration in their target market over the next 10 – 20 years as timeshare operators have achieved over the last 20 years, the destination club industry could potentially grow from approximately 5,000 club members today to over 300,000 club members in 10 – 20 years (assuming a 5% market penetration of Sprectrem Group’s estimated 6.7 million “millionaires” in the US), without even considering the large potential corporate membership market (there are millions of private and public companies globally).

Timeshares currently comprise the largest segment of the overall shared ownership vacation market, with annual sales in 2008 of $9.7 billion, according to ARDA. According to ARDA, there were over 1,600 timeshare resorts operating in 2008, with seven million timeshare intervals owned and 99% of timeshare owners participating in either the RCI or Interval timeshare exchange program. As shown below, timeshare growth since its inception has been dramatic, and timeshare sales represent a significant portion of annual profits at public resort and hospitality companies including Marriott International, Inc., Wyndham Worldwide Corporation, Starwood Hotels & Resorts Worldwide, Inc., Hyatt Hotels Corporation, The Walt Disney Company and Hilton Hotels Corporation.

TIMESHARE ANNUAL SALES 1975-2008

Source: American Resort Developers Association (ARDA)

Since its inception, growth in the high-end shared-use luxury vacation market (fractional, private residence clubs and destination clubs) has been equally dramatic. As noted below, the luxury shared-use market, consisting of luxury destination clubs, private residence clubs and fractional offerings, has grown at a compounded annual growth rate (CAGR) of 32.5% from 2000 – 2008 (see graph below), as compared with the timeshare market during the same 2000 – 2008 period, which grew at a slower compounded annual growth rate (CAGR) of 11.1% (see graph above). Sales in both the timeshare and luxury shared-use markets declined substantially from 2007 to 2008 as a result of the global recession, and our management believes that this trend has continued into 2009.

PRC, DESTINATION CLUB & LUXURY

FRACTIONAL SALES 1999-2008

Source: Ragatz Associates

Our management believes that the emerging luxury destination club market is still in its infancy and has many years of continued growth potential when the global economy improves, as major resort and hospitality brands like Ritz Carlton Destination Club and other luxury brands and new market entrants continue to enter the luxury marketplace. Our management believes that barriers to entry in the luxury destination club market are increasing and further consolidation is likely, forcing smaller destination club players to focus on niche markets, sell to or merge with larger clubs or go out of business. Established hospitality and resort brands will likely enter the growing luxury destination club market in greater numbers, as most recently demonstrated by the 2009 launch of the Ritz Carlton Destination Club. In addition, new destination clubs will continue to form in Europe and Asia, as well as existing clubs expanding their presence internationally to address greater affluence and future high growth markets in Europe and Asia.

Business Strengths

Our management believes that our primary business strengths include:

Strong Experienced Management Team. We have created what we believe is the strongest and most experienced management team in the industry, with demonstrated leadership and a track record of innovation. Our management team has over 100 years of combined experience in hospitality and resort management, destination club operations, real estate, finance and technology.

Best Value; Broadest Product Offerings. For the luxury consumer market, a club membership offers the best value and a more flexible, cost effective vacation alternative as compared with the high costs, inefficiencies and hassles of luxury second home ownership ($1-$5 million purchase price), the expense, uncertainties and time-consuming effort to rent luxury villas in the United States and international markets or the high costs and typical small rooms of luxury hotels. For the corporate market, our corporate membership option targets the growing multi-billion dollar corporate reward and incentive market, and offers corporations an affordable, flexible corporate reward and incentive program for top performing employees, senior executives, board members, key advisors, existing customers and new prospects. We have created what we believe is the best value and broadest family of offerings of any destination club in the industry, with three distinct club offerings, each with five different club membership plans based on the number of annual included days, advance reservations and holiday advance reservations per year. This broad offering, for example, allows “entry level” club members to join our most affordable club, the Premiere Club, and have access to a growing collection of two to four bedroom homes targeting approximately $1 million in value for as little as $70,000 upfront and $8,000 per year in annual dues for 14 days of annual vacation experience. To help understand and appreciate the value proposition of our club memberships as compared with second home ownership, consider the cost and hassles of buying a single $1 million second vacation home comparable to any of our Premiere Club properties. A typical second home buyer will generally use a second vacation home approximately 3-4 weeks per year. Second home buyers typically need to pay a 20% down payment ($200,000 in this case) when purchasing the home and pay annual mortgage interest, principal, taxes, insurance, utilities and property maintenance for the second home each year of approximately $100,000-$150,000 annually. Alternatively, a member joining Ultimate Escapes and purchasing an Ultimate Escapes Premiere Gold Membership, will have 28 included days of club use per year, access to hundreds of club properties and affiliated properties, and none of the hassles of second home ownership and maintenance, and will only pay a one-time upfront membership fee of $105,000 (approximately 50% less than the comparable 20% down payment) and pay annual dues of only $11,000 (approximately 90% less than the $100,000-$150,000 in annual costs associated with owning a single comparable second home). This flexible structure allows club members to select a plan that meets their needs and potentially upgrade later to better plans or more expensive club offerings that provide more days of annual access or use of more expensive homes, all of which provide us with incremental future revenue opportunities from a growing base of affluent club members.

Our unique business model results in improving economies of scale and operational efficiencies. The club operates a unique business model and club structure that includes unique offerings, features and amenities only available to our club members (e.g., lifetime membership, redemption assurance program, 3 unique clubs and 15 unique membership plans, internal and external reciprocity use, access to affiliated hotels and resorts). Our membership plans are structured to provide that 100% of a member’s membership fee is earned as revenue by us over the first 10 years of membership, allowing us to recognize 100% of our member’s membership fee as revenue, where most other clubs only recognize 20-25% of their initial membership fee or refundable deposit as revenue. The company believes this unique business model and club structure allows us to generate higher revenues, EBITDA and net income than other destination clubs in the industry.

Our large growing membership base, high annual renewal rates, and strong member affinity generate growing recurring revenues – our membership base has grown each year we have been in business and today we have a large base of over 1,200 club members. Our club members have renewed their memberships at 97-99% annual renewal rates over the last several years, generating increased revenue visibility and a growing base of recurring revenue each year from member annual dues. We are also increasing our focus on member referral programs to grow our membership base and our large and loyal membership base can earn Ultimate RewardTM points for member referrals that can be redeemed for additional days of use at club properties or redeemed for an extensive list of luxury items and club services such as wine, ski tickets, golf, spa treatments or chef services. Our management believes that this program increases club member loyalty and generates a high level of club member referrals.

Substantial real estate portfolio with approximately $30.3 million of equity. Our real estate portfolio was recently appraised at $153.6 million and has approximately $123.3 million of debt, resulting in approximately $30.3 million of equity in our real estate portfolio.

Planned use of energy efficient, “smart house” technology. We plan to use energy efficient technology in the future in our homes, including remote access, monitoring and control of HVAC, computer, electrical, lighting, audio, security and landscaping systems. We believe these future efforts will provide our members with enhanced and personalized club experiences and reduce our operating costs as a result of integrating “green,” energy efficient technology to manage entertainment services, home security, energy costs and property management. We plan to begin rolling-out “smart home” technology in phases during 2010 and 2011, including a club member “smart card” technology that will provide club members with personalized experiences incorporating whole house audio, whole house video, preferred lighting settings, preferred temperature settings, electronic display of club member’s personal photos, music playlists and high definition art that can be uploaded to the home’s PC server and digital entertainment center via the internet. Pictures of friends and family and art will populate high definition displays and LCD picture frames located throughout the club’s property.

Growth Strategy

Our ~~management~~objective ~~expects~~is to achieve significant EBITDA and revenue growth over the ~~next~~ next several years. Key elements of our future growth strategy include:

•

Expand Organic Sales by:

•

Increasing brand awareness and marketing spend to generate new club membership sales

•

Increasing club member referrals through member events held in major metropolitan markets

•

Increasing sales staff in major cities throughout North America and internationally

•

Expanding corporate membership sales programs

•

Encouraging club member upgrades with regular incentive programs

•

Pursue Additional Acquisitions: Less expensive to buy existing clubs and properties than build, due to historically lower club member acquisition costs and real estate costs.

•

Global Expansion in:

•

Europe

•

Asia

• Introduce New Club Offerings through:

• Equity club offering

• Points-based club membership plans

•

Marketing Partnerships/Joint Ventures with Hospitality REITS

•

“Private Label” Offerings with Resort and Hospitality Brands

Club Membership Plans and Benefits

We offer multiple club membership plans divided into three club tiers designated Premiere, Signature and Elite, that provide club members between 14 and 60 days of use annually at a unique collection of club and affiliate destinations located around the world. Our destination properties are located in or near markets with global tourist and business appeal that offer club members a world class vacation experience. By combining the best elements of multi-million dollar single family residences with world class amenities and concierge service, management believes it has created the best and most cost-effective option for access to luxury second-home ownership available in the market today.

Premiere ~~ClubTM~~Club TM

Premiere Club membership plans range from the Bronze plan, with an initial membership fee of $70,000 and $8,000 in annual dues for 14 days of annual vacation use, up to the Platinum Plus plan, with an initial membership fee of $150,000 and $17,000 in annual dues for 60 days of annual vacation use. All of our club membership plans include extended family use for maximum value and flexibility, as club members may grant access to their unaccompanied family members (age 21 and over) for any amount of their given annual use. Each home in the Premiere Club portfolio is designed to accommodate families with children of all ages. Premiere Club properties have a target home value of approximately $1 million. The club allows its members to upgrade their club membership plans as their vacation needs evolve every year.

48Signature Club TM

Signature ClubTM

Signature Club membership plans range from the Bronze plan, with an initial membership fee of $145,000 and $11,500 in annual dues for 14 days of annual vacation use, up to the Platinum Plus membership plan, with an initial membership fee of $300,000 and $35,500 in annual dues for 60 days of annual vacation use. All of our club membership plans included extended family use for maximum value and flexibility, as club members may grant access to their unaccompanied family members (age 21 and over) for any amount of their given annual use. Each home in the Signature Club portfolio is designed to accommodate families with children of all ages. Signature Club properties are generally larger than homes in the Premiere Club and have a target home value of approximately $2 million. The club allows its members to upgrade their club membership plans as their vacation needs evolve every year.

~~Elite ClubTM~~42

Elite Club TM

Elite Club membership plans range from the Bronze plan, with an initial membership fee of $200,000 and annual dues of $16,000 for 14 days of annual vacation use, up to the Platinum Plus plan, with an initial membership fee of $450,000 and $49,000 in annual dues for 60 days of annual vacation use. All of our club membership plans included extended family use for maximum value and flexibility, as club members may grant access to their unaccompanied family members (age 21 and over) for any amount of their given annual use. Each home in the Elite Club portfolio is designed to accommodate families with children of all ages. Elite Club properties are generally larger than homes in the Premiere Club and Signature Club and are of the highest standards, with target home values of approximately $3 million and the club allows club members to upgrade their club membership plans as their vacation needs evolve every year.

Members of any club membership plan can add a “ corporate option ” to their club membership for an additional 10% of their club membership and annual dues. This allows the club member to designate any key executives, employees, customers and business prospects (21 and over) to use the club unattended by the primary club member. The corporate use option has proven to be a ~~tremendous~~valuable tool for employee rewards and retention programs.

The Ultimate ~~CollectionTM~~Collection TM

The Ultimate Collection provides club members with access to over 140 luxury four and five-star hotels in many of the world’s most desirable cities and resorts throughout the United States, Europe, Asia, the Middle East, Central America and South America, Africa and Australia. Club members can make reservations at any of the beautiful luxury hotels in exciting cities and resorts, using up to seven of the club membership “included days” each year, as if a club member was using club properties.

49Ultimate Rewards Program TM

Ultimate Rewards ProgramTM

The Ultimate Rewards Program is the destination club industry’s first club membership rewards points program which rewards club members who recommend a friend, family member or business colleague for club membership if they subsequently join us. Club members can redeem reward points for extra club days, annual dues, private yacht and jet charters, private chef services, trips to special events and much more.

Smart Home Technology

We have invested ~~millions of dollars~~ in developing a proprietary web-based technology platform and we are planning to begin using “smart home” technology to improve our ability to manage club properties, reduce energy and water consumption and provide club members with a safer and more comfortable experience and home environment.

~~Owned Properties~~43

The following table sets forth, as of December 31, 2009, for each parcel of real property owned by us, the most recent appraised value of the property, the amount owed by us under any mortgage securing the property, and our equity in the property.

Destination	Home Name	Appraised Value		First Mortgage		Second Mortgage		Net Equity
Abaco, Bahamas	Abaco Club #42	$	2,100,000	$	1,572,913	$	199,973	$	327,114
Abaco, Bahamas	Abaco Club #43	$	2,100,000	$	1,572,913	$	199,973	$	327,114
Abaco, Bahamas	Abaco Club #5	$	1,100,000	$	823,907	$	104,748	$	171,346
Abaco, Bahamas	Abaco Club #6	$	1,100,000	$	823,907	$	104,748	$	171,346
Abaco, Bahamas	Abaco Club #8	$	2,200,000	$	584,476	$	880,000	$	735,524
Beaver Creek	Beaver Creek Lodge	$	3,550,000	$	2,658,971	$	338,050	$	552,979
Beaver Creek	The Charter	$	875,000	$	345,449	$	147,594	$	381,957

Belize	Belizean Dreams	$	700,000	$	266,988			$	433,012
Big Island, HI	Maluhia	$	430,000	$	322,073			$	107,927
Big Island, HI	Wailana	$	440,000	$	329,563			$	110,437
Breckenridge, CO	Snowflake at Blue Sky	$	1,825,000	$	1,233,984	$	494,038	$	96,978
Candlewood	Candlewood Lake	$	1,200,000	$	898,807	$	114,270	$	186,922
Chicago	Lincoln Park	$	715,000	$	535,539			$	179,461
Chicago	Millennium Park	$	1,250,000	$	936,257			$	313,743
Copper Mountain	Super Bee	$	1,600,000	$	1,198,410			$	401,590
Deer Valley	Silver Lake #2	$	2,350,000	$	1,760,164	$	223,780	$	366,056
Deer Valley	Silver Lake #6	$	3,684,000	$	2,759,338	$	350,810	$	573,852
Delray Beach	Ocean View	$	5,000,000	$	3,745,030	$	476,127	$	778,843
Dominican Republic	Villa Maria	$	850,000	$	306,850			$	543,150
Dominican Republic	Villa Kary	$	1,425,000	$	550,382			$	874,618
Fox Acres	Fox Acres	$	317,000	$	237,435			$	79,565
Indian Rocks Beach	Beach House	$	2,500,000	$	1,872,515	$	238,063	$	389,422
Jackson Hole	Teton Mountain Lodge	$	1,000,000	$	749,006			$	250,994
Jackson Hole	Snake River Lodge #231/232	$	1,235,000	$	925,022	$	117,603	$	192,374
Jackson Hole	Snake River Lodge #339/340	$	1,300,000	$	973,708	$	123,793	$	202,499
Kiawah	Windhaven	$	3,800,000	$	2,846,223	$	361,857	$	591,921
Kiawah	Night Heron	$	600,000	$	449,404			$	150,596
Kiawah	Broomsedge	$	950,000	$	711,556			$	238,444
La Costa	La Costa Resort #12	$	725,000	$	543,029			$	181,971
La Costa	La Costa Resort #7	$	1,440,000	$	1,078,569			$	361,431
La Quinta	Montana	$	500,000	$	374,503			$	125,497
La Quinta	Laguna	$	490,000	$	367,013			$	122,987
La Quinta	PGA West	$	900,000	$	674,105			$	225,895
Lake George	Sagamore	$	630,000	$	471,874			$	158,126
Lake Las Vegas	Tramonto	$	600,000	$	449,404	$	57,135	$	93,461
Lake Las Vegas	Viera	$	299,900	$	433,840			$	(133,940	)
Lake Tahoe	Squaw Valley #209	$	470,000	$	352,033	$	44,756	$	73,211
Lake Tahoe	Squaw Valley #309	$	470,000	$	352,033	$	44,756	$	73,211
Lake Tahoe	Third Creek	$	829,000	$	620,926			$	208,074
Lake Tahoe	Caddie Court	$	1,740,000	$	1,303,270	$	165,692	$	271,037
Los Cabos	Casa Eternidad	$	3,550,000	$	2,658,971	$	338,050	$	552,979
Los Cabos	Villa Paraiso	$	3,450,000	$	2,584,071	$	328,528	$	537,402
Los Cabos	Esperanza 1501	$	1,900,000	$	1,423,111	$	180,928	$	295,960
Los Cabos	Esperanza 1502	$	1,900,000	$	1,423,111	$	180,928	$	295,960
Los Cabos	Esperanza 1503	$	2,000,000	$	1,498,012	$	190,451	$	311,537
Los Cabos	Casa Oceano	$	1,000,000	$	749,006			$	250,994
Los Cabos	Villa Rubi	$	500,000	$	374,503			$	125,497
Los Cabos	Casa Paraiso	$	1,550,000	$	1,160,959			$	389,041
Los Cabos	Casa Martha	$	1,450,000	$	1,086,059	$	138,077	$	225,865
Los Cabos	Villa del Sol	$	1,400,000	$	1,048,608	$	133,316	$	218,076
Los Cabos	Casa Tortuga	$	1,500,000	$	1,123,509	$	142,838	$	233,653
Los Cabos	Esperanza 1601	$	1,800,000	$	1,348,211	$	171,406	$	280,384
Los Cabos	Esperanza 1602	$	1,800,000	$	1,348,211	$	171,406	$	280,384

Los Cabos	Esperanza 1603	$	1,900,000	$	1,423,111	$	180,928	$	295,960
Maui	Wailea #208	$	3,700,000	$	2,771,322	$	352,334	$	576,344
Miami Beach	Trump Miami	$	500,000	$	395,795	$	147,594	$	(43,389	)
Miami Beach	Acqualina	$	1,375,000	$	1,029,883	$	130,935	$	214,182
Naples	Monteverde	$	670,000	$	501,834	$	63,801	$	104,365
Naples	Strada Bella	$	775,000	$	580,480	$	73,800	$	120,721
Nevis	Villa 2	$	1,980,000	$	1,483,032	$	188,546	$	308,422
Nevis	Villa 3	$	1,980,000	$	1,483,032	$	188,546	$	308,422
Nevis	Villa 4	$	1,980,000	$	1,483,032	$	188,546	$	308,422
Nevis	Villa 6	$	2,290,000	$	1,715,224	$	218,066	$	356,710
Nevis	Villa 7	$	2,290,000	$	1,715,224	$	218,066	$	356,710
Nevis	Villa Paradiso #1 (slab)	$	810,000	$	606,695	$	77,133	$	126,173
Nevis	Villa Paradiso #10 (30% complete)	$	850,000	$	636,655	$	80,942	$	132,403
Nevis	Villa 8	$	1,560,000	$	1,168,449	$	148,552	$	242,999
Nevis	Villa 9	$	1,560,000	$	1,168,449	$	148,552	$	242,999
NYC	Trump #300/301	$	3,000,000	$	2,247,018	$	285,676	$	467,306
NYC	Trump #302/303	$	1,725,000	$	1,292,035	$	164,264	$	268,701
NYC	Trump #310	$	2,250,000	$	1,685,263	$	214,257	$	350,479
NYC	1600 Broadway #PH5D	$	3,150,000	$	1,776,648	$	375,281	$	998,071
NYC	Link #29C	$	910,000	$	681,595			$	228,405
NYC	Trump #318	$	1,050,000	$	786,456			$	263,544
NYC	1600 Broadway #18F	$	1,075,000	$	805,181			$	269,819
NYC	Trump #308	$	1,135,000	$	850,122			$	284,878
NYC	Link #31B	$	1,900,000	$	1,299,451			$	600,549
NYC	Trump #1222	$	1,065,000	$	797,691	$	101,415	$	165,894
NYC	Trump #1622	$	1,075,000	$	805,181	$	102,367	$	167,451
Outer Banks	Osprey	$	700,000	$	524,304			$	175,696
Outer Banks	Hunters Green	$	900,000	$	674,105			$	225,895
Punta Mita	La Playa	$	735,000	$	550,519			$	184,481
Reynolds Plantation	Carolyn's Pond	$	680,000	$	509,324			$	170,676
Reynolds Plantation	Oconee Estate	$	1,100,000	$	1,160,000			$	(60,000	)
Scottsdale	Happy Valley	$	2,100,000	$	1,572,913	$	199,973	$	327,114
Scottsdale	The Rocks	$	900,000	$	674,105	$	85,703	$	140,192
Scottsdale	Highpoint	$	775,000	$	580,480	$	73,800	$	120,721
Scottsdale	Preserve Way	$	655,000	$	490,599	$	62,373	$	102,028
St. Thomas	Lovenlund Estate	$	1,700,000	$	1,273,310	$	161,883	$	264,807
Steamboat Springs	Eagle Ridge Lodge	$	590,000	$	441,914			$	148,086
Steamboat Springs	Mountaineer	$	1,100,000	$	823,907	$	104,748	$	171,346
Stowe Vermont	Topnotch #512	$	696,000	$	521,308			$	174,692
Sun Valley	MacKenzie Lane	$	3,100,000	$	2,321,918	$	295,199	$	482,883
Sun Valley	Plaza #2	$	1,800,000	$	1,348,211	$	171,406	$	280,384
Telluride	Country Club	$	2,000,000	$	1,498,012	$	190,451	$	311,537
Telluride	Cabin #4	$	1,600,000	$	1,198,410	$	152,361	$	249,230
Telluride	Cabin #8	$	1,400,000	$	1,048,608	$	133,316	$	218,076
Turks & Caicos	English Cottage	$	1,050,000	$	343,700			$	706,300
Turks & Caicos	Dundee Estate	$	2,800,000	$	2,097,217			$	702,783

Tuscany	Villa Cassia	$	800,000	$	606,750			$	193,250
Tuscany	Borgo di Vagli	$	700,000	$	0			$	700,000
Tuscany	Rigo Salcio	$	1,500,000	$	1,314,625			$	185,375
Watercolor	Seaside	$	905,000	$	490,044			$	414,956
Watercolor	Seagrove	$	1,650,000	$	981,020	$	147,594	$	521,386
TOTAL		$	153,580,900	$	111,071,889	$	12,192,101	$	30,316,910

Intellectual Property

We own the trademarks “Ultimate Escapes,” “Ultimate Resort,” “Private Escapes” and related trademarks. Such trademarks are material to our business. All of the material trademarks are registered (or have applications pending) with the United States Patent and Trademark Office as well as, in some cases, with the relevant authorities in certain foreign countries.

We also own the following Internet domain names: ultimateescapes.com, whatisadestinationclub.com, whatsadestinationclub.com, private-escapes.com, ultimateescapes.info, ultimateescapes.net, ultimateescapes.org, ultimateescapes.tv, privateescapes.com and privateescapes.co.uk.

Seasonality

Our business, like ~~all~~most organizations in the travel industry, is subject to seasonal activity. The chart below shows overall club occupancy by month for 2009 and this seasonality pattern is typical for historical years as well. High travel seasons are typically January through March for winter vacations and June through August for summer vacations. A key factor is the school calendar, for those club members with children still living at home, which creates greater occupancy pressure during holiday periods. Seasonality also varies by type of destination. For example, club mountain properties are typically heavily occupied during the ski season, yet tend to remain vacant during the “shoulder seasons” (April through early June and September through December) resulting in an annualized occupancy of 40 – 45%. Conversely, club city destinations are typically not seasonal due to both business and pleasure trips, ~~consistently~~ consistently generating month-over-month club occupancies in the 80 – 90% range.

532009 Seasonality

International Properties and Club Members Located Abroad

As of December 31, 2009, we operated a total of 44 properties located outside of the United States, as follows:

Bahamas			5
Belize			1
Costa Rica			2
Dominican Republic			2
England			2
France			1
Italy			3
Mexico			17
Nevis			7
St. Thomas, USVI			1
Tortola, BVI			1
Turks & Caicos			2
Total			44

In addition, as of December 31, 2009 we had 54 club members that reside outside the United States in the following countries:

Mexico			2
Canada			41
Estonia			1
Germany			1
UK			8
Brazil			1
Total:			54

Regulation

Government Regulation

Our business is subject to and affected by international, federal, state and local laws, regulations and policies, which are subject to change. The descriptions of the laws, regulations and policies that follow are summaries of those which we believe to be most relevant to our business and do not purport to cover all of the laws, regulations and policies that affect our businesses. We believe that we are in material compliance with these laws, regulations and policies.

•

Marketing Operations. Our club products are marketed through a number of distribution channels, each of which is regulated at the federal and state level. Such regulations may limit our ability to solicit new customers or to market additional products or services to existing customers. For example, to comply with state and federal “do not call” regulations, we have adopted processes to routinely identify and remove phone numbers listed on the various “do not call” registries from our calling lists and have instituted procedures for preventing unsolicited or otherwise unauthorized telemarketing calls. We have similarly adopted email messaging practices, and utilize various software systems responsive to the requirements of various state and federal regulations which may place limitations on our ability to engage our consumers in electronic mail marketing campaigns, most notably, the CAN-SPAM Act, which imposes various requirements on the transmission of e-mail messages whose primary purpose is to advertise or promote a commercial product or service. Further we have placed an emphasis on permission-based marketing and referrals.

• Privacy and Data Collection. The collection and use of personal data of our customers, as well as the sharing of our customer data with affiliates and third parties, are governed by privacy laws and regulations enacted in the United States and in other jurisdictions around the world. For instance, several states have introduced legislation or enacted laws and regulations that require compliance with standards with standards for data collection and protection of privacy and, in some instances, provide for penalties for failure to notify customers when the security of a company’s electronic/computer systems designed to protect such standards are breached, even by third parties. Other states, such as California, have enacted legislation that requires enhanced disclosure on Internet web sites regarding consumer privacy and information sharing among affiliated entities or have such legislation pending. In addition, the European Union Directive on Data Protection requires that, unless the use of data is “necessary” for certain specified purposes, including, for example, the performance of a contract with the individual concerned, consent must be obtained to use the data (other than in accordance with our stipulated privacy policies) or to transfer it outside of the European Union. We believe that we are in material compliance with the laws and regulations applicable to privacy and data collection as such are relevant to our business.

•

Internet. A number of laws and regulations have been adopted to regulate the Internet, particularly in the areas of privacy and data collection. In addition, it is possible that existing laws may be interpreted to apply to the Internet in ways that the existing laws are not currently applied, particularly with respect to the imposition of state and local taxes on transactions through the Internet. Regulatory and legal requirements are particularly subject to change with respect to the Internet. We cannot predict with certainty whether such new requirements will affect our practices or impact our ability to market our products and services online.

•

Seller of Travel Regulation. Our activities in the State of Florida are governed by the Florida Sellers of Travel Act, Chapter 559, Florida Statutes. We currently hold all necessary registrations under this statute, and believe that we are in material compliance with its provisions.

• Regulations of Timeshare Plan and Similar Products. We are confident based upon various regulatory opinions and court decisions that our business is not currently subject to any various State regulations governing timeshare plans and similar products, provided however that we have not received nor requested either a declaratory ruling or no-action letter from any State agency with respect to same. Because of the lack of any enacted regulation ofas specifically respects the destination club industry, we cannot predict with certainty the likelihood of the imposition of new laws and regulation of the industry, or the likelihood that existing regulations of timeshare plans will be extended, interpreted and applied to include the destination club industry and/or the club products currently being marketed and sold in our business.

Competition

•

number and variety of club destinations available to club members;

•

quality of member services and concierge services;

•

quality of destination club properties;

•

pricing of club membership plans;

•

type and quality of resort amenities offered;

•

reputation of club;

•

destination club properties in proximity to major population centers;

•

availability and cost of air and ground transportation to destination club properties; and

•

ease of travel to resorts (including direct flights by major airlines).

Club Members Located Abroad

As of December 31, 2009, we had 54 club members that reside outside the United States in the following countries:

Mexico			2
Canada			41
Estonia			1
Germany			1
United Kingdom			8
Brazil			1
Total:			54

Intellectual Property

Employees

As of December 31, 2009, we had 88 full time employees. Our employees are not covered under any collective bargaining agreement and we have never experienced a work stoppage. We believe we have good relations with our employees.

We believe that our existing facilities are suitable and adequate for our business and have sufficient capacity for their intended purpose.

Facilities

Our office facilities are leased, as follows:

Location	Purpose	Square Feet		Monthly Rent		Lease Expires

Kissimmee, FL	Executive offices		5,500	$	11,650	October 31, 2010

Fort Collins, CO	Operations center		4,500	$	10,400	August 31, 2010

Kansas City, MO	Operations center		8,800	$	9,400	December 31, 2010

Our executive offices are leased from La Mirada Plaza, LLC, an affiliate of James M. Tousignant, our President and Chief Executive Officer and a member of our board of directors.

The majority of our club properties are owned by us, and certain club properties are leased on either a long or short term basis. All of the properties owned by us are subject to one or more mortgages. We intend to sell certain club properties and those properties are classified as Held For Sale in our consolidated balance sheet. Of the 37 properties leased by us as of December 31, 2009, 27 were subject to long-term leases and ten were subject to short-term leases (including two short-term leases in which PE Holdings, an affiliate of ours, is the lessor).

The following table summarizes the number of club properties by location as of December 31, 2009.

	UE Club	Destination	Owned		Leased		Total Properties		Held For Sale

US	Elite	Beaver Creek		1		1		2		-
		Deer Valley		2		1		3		-

		Delray Beach		1		-		1		-

		Indian Rocks		1		-		1		-

		Jackson Hole		-		1		1		-
		Key West		1		-		1		-
		Kiawah		1		1		2		-
		La Quinta		-		1		1		-
		Lake Las Vegas		1		-		1		-
		Lake Tahoe		-		1		1		-
		Maui		1		1		2		-
		Naples		-		1		1		-

		New York City		4		1		5		-
		Scottsdale		2		-		2		-

		Steamboat Springs		-		1		1		-

		Stowe		-		1		1		-
		Sun Valley		2		-		2		-
		Telluride		1		4		5		-
		Watercolor		-		1		1		-
		Total Elite		18		16		34		0

Signature	Bend, Oregon	-	1	1	-
	Big Island	-	1	1	-
	Boca Raton	-	1	1	-

	Breckenridge	1	-	1	-
	Candlewood	1	-	1	1
	Carlsbad	1	-	1	1
	Chicago	1	-	1	1

	Copper Mountain	1	-	1	-
	Deer Valley	-	1	1	-

	Jackson Hole	2	-	2	-
	Kiawah	1	2	3	-
	La Quinta	1	1	2	-

	Lake George	1	-	1	-
	Lake Tahoe	1	-	1	-
	Maui	-	2	2	-

	Miami Beach	1	-	1	-
	Naples	1	-	1	-

	New York City	4	-	4	-
	Orlando	-	1	1	-
	Outerbanks	1	-	1	-

	Reynolds Plantation	1	-	1	-
	Scottsdale	2	1	3	1

	Steamboat Springs	1	1	2	-
	Telluride	2	1	3	-
	Watercolor	1	-	1	-
	Total Signature	25	13	38	4

Premiere	Beaver Creek	1	-	1	-
	Big Island	2	-	2	-
	Carlsbad	1	-	1	1
	Chicago	1	-	1	-
	Fox Acres	1	-	1	-

	Jackson Hole	1	-	1	-
	Kiawah	1	-	1	-
	La Quinta	2	-	2	-

	Lake Las Vegas	1	-	1	-
	Lake Tahoe	3	-	3	1
	Miami	1	-	1	-
	Naples	1	-	1	-

	New York City	3	-	3	-
	Outerbanks	1	-	1	-

	Reynolds Plantation	1	-	1	-

	Steamboat Springs	1	-	1	1
	Stowe	1	-	1	-
	Watercolor	1	-	1	-
	Total Premiere	24	0	24	3

	US Total	67	29	96	7

Foreign	Elite	Bahamas	2	-	2	-
		Italy	-	1	1	-
		London	-	1	1	-

		Los Cabos, Mexico	5	2	7	-
		Nevis	5	-	5	-
		Paris	-	1	1	-
		St. Thomas	1	-	1	-
		Total Elite	13	5	18	0

	Signature	Bahamas	3	-	3	1
		Costa Rica	-	1	1	-

		Dominican Republic	1	-	1	-
		Italy	1	-	1	-

		La Buscador (BVI)	1	-	1	-
		London	-	1	1	-

		Los Cabos, Mexico	7	-	7	-
		Nevis	2	-	2	-

		Turks & Caicos	1	-	1	-
		Total Signature	16	2	18	1

	Premiere	Belize	1	-	1	-
		Costa Rica	-	1	1	-

		Dominican Republic	1	-	1	-
		Italy	2	-	2	-

		Los Cabos, Mexico	2	-	2	-

		Punta Mita, Mexico	1	-	1	-
		Turks & Caicos	1	-	1	-

		Total Premiere	8	1	9	0

		Foreign Total	37	8	45	1

		Grand Total	104	37	141	8

Legal Proceedings

We are not currently subject to any material legal proceedings. From time to time, however, we ~~and/~~are or ~~our subsidiaries~~ may become involved in litigation and other legal proceedings relating to claims arising from our operations in the normal course of business, including claims involving club membership disputes.

5650

MANAGEMENT

Directors and Executive Officers

Our directors and executive officers, and their ages as of ~~January~~March 131, 2010, are set forth below:

Name	Age	Position
James M. Tousignant	49	President, Chief Executive Officer and Class C Director
Richard Keith	54	Chairman and Class B Director
Philip Callaghan	57	Chief Financial Officer and Secretary
Robert Glinka	53	Chief Operating Officer
Ted Curtis	56	Chief Sales and Marketing Officer
Gregg Amonette	5657	Senior Vice President, Business Development
Thomas D’Ambrosio	53	Senior Vice President, Chief Technology Officer
C. Thomas McMillen	57	Class C Director
Mark A. Frantz	41	Class B Director
Stephen Griessel	50	Class A Director

~~James~~The M.Class ~~Tousignant has served as our President~~A, ~~Chief~~Class ~~Executive~~B ~~Officer~~ and Class C ~~Director~~directors ~~since~~will ~~October~~stand 2009. Prior to that, Mr. Tousignant served as the Founder, President, Chief Executive Officer and Director of Ultimate Escapes Holdings from May 2004. Prior to founding Ultimate Escapes Holdings in May 2004, Mr. Tousignant was most recently managing director at Thomson Financial and Morgan Stanley (NYSE: MS), where he was responsible for ~~global sales and business development. From April 1993 to September 2000, Mr. Tousignant was the co~~re-~~founder~~election and president of Multex.com (formerly NASDAQ: MLTX), a global provider of online financial information services, and was responsible for managing a rapidly growing global company with thousands of customers, 500 employees and revenues of $100 million worldwide. He was also active in raising more than $50 million in private venture capital at ~~Multex, managing four acquisitions, and overseeing~~ the ~~company’s successful $40 million IPO in 1999. Mr. Tousignant started his first company~~2010, ~~Mirror Images Software,~~2011 ~~Inc.,~~and as2012 aannual ~~senior~~meetings atof ~~Rensselaer~~our ~~Polytechnic Institute (RPI). Mr. Tousignant attended RPI from 1978 to 1982~~stockholders, ~~majoring in Management with a minor in Computer Science~~respectively.

~~Richard~~James M. ~~Keith~~Tousignant has served as our ~~Chairman~~President, Chief Executive Officer and Class C B Director since October 2009. In ~~April~~Prior ~~1990~~to that, Mr. ~~Keith~~Tousignant ~~started~~served ~~AppleOne~~as ~~Employment~~the Founder, ~~Services~~President, Chief Executive Officer and Director of Ultimate Resort from ~~Colorado~~May 2004. InPrior ~~five~~to ~~years~~founding Ultimate Resort in May 2004, Mr. ~~Keith~~Tousignant ~~sold~~was ~~the~~most recently ~~company~~managing todirector ~~Corestaff~~at ~~Services~~Thomson Financial and Morgan Stanley (NYSE: MS), ~~co-founded~~where ahe ~~second~~was ~~start-up~~responsible ~~company~~for global sales and business development. From April 1993 to September 2000, ~~Center~~Mr. ~~Partners~~Tousignant was the co-founder and president of Multex.com, Inc. (formerly NASDAQ: MLTX), a ~~call~~global ~~center business.~~provider Inof ~~October~~online ~~1999~~financial information services, ~~Center~~and ~~Partners~~was ~~sold~~responsible tofor ~~the~~managing ~~London-based~~a ~~WPP~~rapidly ~~Group.~~growing global Incompany ~~2003~~with Mrthousands of customers, 500 employees and revenues of $100 million worldwide. ~~Keith~~He ~~founded~~was ~~Private~~also ~~Escapes~~active ~~Destination~~in ~~Clubs~~raising ~~and~~more ~~created~~than ~~Private~~$50 million in private ~~Escapes~~venture ~~Premiere.~~capital Inat ~~August~~Multex, ~~2004~~managing four acquisitions, and overseeing the company’s successful $40 million initial public offering in 1999. Mr. ~~Keith~~Tousignant started ~~and~~ his ~~team~~first ~~launched~~company, ~~Private Escapes~~Mirror ~~Platinum~~Images Software, ~~and~~Inc., ~~Private~~as ~~Escapes~~a ~~Pinnacle~~senior ~~followed~~at Rensselaer inPolytechnic ~~August~~Institute ~~2006~~(RPI). Mr. ~~Keith~~ Tousignant attended ~~Bates~~RPI ~~College~~from 1978 to 1982, majoring in Management with a minor in Computer Science.

~~Philip~~Richard ~~Callaghan~~Keith has served as our ~~Chief~~Chairman ~~Financial~~and ~~Officer~~Class ~~and~~B ~~Secretary~~Director since October 2009. ~~Prior~~ In toApril ~~that~~1990, Mr. ~~Callaghan~~Keith ~~served~~started asAppleOne ~~Ultimate~~Employment ~~Escapes Holdings’~~Services ~~Chief~~of ~~Financial Officer since July 2004~~Colorado. ~~From September 2002 to June~~In ~~2004~~five years, Mr. ~~Callaghan~~Keith ~~was~~sold ~~Chief~~the ~~Financial~~company ~~Officer~~to ofCorestaff ~~the~~Services ~~Global~~and ~~Sales~~co-founded ~~Account~~a ~~Management~~second ~~team~~start-up ~~for~~company, ~~the~~Center ~~Thomson~~Partners, ~~Corporation~~Inc., Hea ~~served~~call ascenter ~~Chief~~business. ~~Financial~~In ~~Officer~~October ~~of eNews. Com~~1999, aCenter ~~subsidiary~~Partners ofwas ~~Barnes~~sold ~~and~~to ~~Noble~~the ~~(NYSE:~~London-based ~~BKS)~~WPP ~~from January 2000 through June 2002~~Group. ~~From~~In ~~December 1996 through September 1999 he served as~~2003, ~~Chief~~Mr. ~~Financial~~Keith ~~Officer~~founded ~~for~~Private ~~Multex.com~~Escapes ~~(formerly~~Destination ~~NASDAQ:~~Clubs ~~MLTX)~~and ~~during~~created ~~which~~Private ~~time~~Escapes ~~the~~Premiere, ~~company~~and ~~went~~he ~~public. Mr. Callaghan has also~~ served as Chief ~~Financial~~ Executive Officer of ~~Graff~~Private ~~Pay~~Escapes Destination ~~Per~~Clubs ~~View,~~from a2004 ~~distributor~~until ofSeptember ~~programming~~2009. toIn ~~the~~August ~~cable and satellite industries~~2004, asMr. ~~Managing~~Keith ~~Director of Media Computer Systems Limited, a~~and ~~software~~his ~~developer~~team ~~for~~launched ~~the~~Private ~~television~~Escapes ~~industry~~Platinum, and asPrivate ~~Finance~~Escapes ~~Director for MTV~~Pinnacle ~~Europe,~~followed ~~the~~in ~~cable~~August ~~television programmer~~2006. Mr. ~~Callaghan~~Keith ~~was~~attended ~~admitted~~Bates ~~as a Fellow of the Institute of Chartered Accountants of England and Wales in 1982, received a Bachelor of Science from University~~ College ~~London in Pure Physics, and holds dual nationality in the USA and UK~~.

57Philip Callaghan has served as our Chief Financial Officer and Secretary since October 2009. Prior to that, Mr. Callaghan served as Ultimate Escapes Holdings’ Chief Financial Officer since July 2004. From September 2002 to June 2004, Mr. Callaghan was Chief Financial Officer of the Global Sales Account Management team for the Thomson Corporation. He served as Chief Financial Officer of eNews.Com, Inc. a subsidiary of Barnes and Noble (NYSE: BKS), from January 2000 through June 2002. From December 1996 through September 1999, he served as Chief Financial Officer for Multex.com, Inc. (formerly NASDAQ: MLTX) during which time the company went public. Mr. Callaghan has also served as Chief Financial Officer of Graff Pay Per View, a distributor of programming to the cable and satellite industries, as Managing Director of Media Computer Systems Limited, a software developer for the television industry, and as Finance Director for MTV Europe, the cable television programmer. Mr. Callaghan was admitted as a Fellow of the Institute of Chartered Accountants of England and Wales in 1982, received a Bachelor of Science in Pure Physics, from University College London and holds dual nationality in the United States and United Kingdom.

Robert S. Glinka has served as our Chief Operating Officer since January 2010. From November 2009 until January 2010, Mr. Glinka served as a consultant to us. From October 2008 until October 2009, Mr. Glinka served as CEO of Areus Holdings, LLC a startup privately held business whose concentration was in the hotel segment of the hospitality industry. From 2005 through 2008, Mr. Glinka served in a variety of capacities with Celebrity Resorts, a privately held vacation ownership company. Mr. Glinka’s roles during this time ranged from Executive Director of Acquisitions & Development to Chief Development Officer. From 2003 to 2005, Mr. Glinka served as both a consultant and Vice President of Development for The Sol Melia Vacation Club and was a member of the startup team for this international venture. From 1998 to 2003, Mr. Glinka served in several capacities with Fairfield Resorts and with the Cendant Corporation following the 2001 acquisition of Fairfield by Cendant. During this time, Mr. Glinka served as Vice President of Planning, Senior Vice President of Planning & Development and as Executive Vice President of Business Development. From 1978 to 1998, Mr. Glinka worked for The Walt Disney Company, serving in a variety of capacities within functional areas such as Accounting, Financial Planning, Business Development and Operations Planning. Mr. Glinka holds a BSBA from Western New England College in Springfield, Massachusetts and an MBA from the Roy E. Crummer Graduate School of Business. Mr. Glinka is a member of Beta Gamma Sigma, the prestigious international honor society which recognizes business excellence.51

~~Ted~~Robert ~~Curtis~~S. Glinka has served as our Chief ~~Sales~~Operating ~~and Marketing~~ Officer since January 2010. ~~From~~ From November 2009 until January 2010, Mr. ~~Curtis~~Glinka served as a consultant to us. From October ~~August~~2008 ~~2004~~until toOctober ~~April~~2009, ~~2007~~Mr. ~~and~~Glinka ~~from~~served ~~June~~as ~~2008~~Chief Executive Officer of toAreus ~~December~~Holdings, ~~2009~~LLC, ~~Mr.~~a ~~Curtis~~startup ~~provided~~privately ~~sales~~held ~~and~~business ~~marketing~~whose ~~services~~concentration ~~to privately~~was ~~held~~in ~~vacation~~the ~~ownership~~hotel ~~companies~~segment ~~with~~of ~~operations~~the ~~throughout~~hospitality ~~the~~industry. ~~United~~From ~~States~~2005 through 2008, Mr. ~~Caribbean,~~Glinka ~~Middle~~served ~~East~~in ~~and~~a ~~North~~variety ~~Africa. Mr.~~of ~~Curtis~~capacities ~~also~~with ~~served~~Celebrity asResorts, a privately ~~Senior~~held ~~Vice~~vacation ~~President~~ownership ofcompany. ~~Sales~~Mr. ~~and~~Glinka’s ~~Marketing~~roles ~~for~~during ~~Celebrity~~this ~~Resorts~~time ranged from Executive ~~May~~Director of ~~2007~~ ~~through~~Acquisitions ~~May~~& ofDevelopment ~~2008~~to Chief Development Officer. From 2003 to ~~2004~~2005, Mr. ~~Curtis~~Glinka served as ~~Senior~~ ~~Vice~~both a consultant and Vice President of ~~Sales~~Development ~~and~~for ~~Marketing~~The ~~for~~Sol ~~Trendwest~~Melia ~~Resorts,~~Vacation Club and was a

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