Ultimate Escapes Does Not Authorize Quintess Offer To Members

By: Destination Club News
Date: September 16, 2010

Not so fast. Tailing an offer by Quintess to Ultimate Escapes members, Ultimate Escapes CEO and President Jim Tousignant and Chief Restructuring Officer Sheon Karol have fired back, calling for members to not act on any offers they receive and to update them about the status of future club reservations.

Dear Members:

You may have recently received an offer to join another destination club. You should be aware that this offer and communication was NOT authorized by Ultimate Escapes, and also that the Company continues active discussions with a number of interested parties regarding a potential transaction. We will keep you apprised of developments in the forthcoming days. Until that time, the Company recommends you take NO action regarding ANY offer you may receive.

In addition, the Company is actively working with our lender to provide our Members with greater clarity ASAP regarding existing member reservations, particularly those reservations previously booked for arrival over the next 30 days, and we expect to be able to update Members no later than Monday, September 20th regarding all existing reservations, including existing reservations in both owned and leased homes. We apologize for any inconvenience and we greatly appreciate your patience in this matter.

Warm regards

Jim Tousignant, President & CEO
Sheon Karol, CRO

It has been a fluid week for members of Ultimate Escapes, beginning last Thursday when they learned that their club was "in crisis" after Ultimate Escapes defaulted on their loan agreement with CapitalSource. With little cash and limited funding from CapitalSource, Tousignant detailed a plan to restructure the club as a partially member-owned entity. Members were asked to vote on a proposal with the club needing an estimated 750 members to approve such a measure before moving forward. As members digested this new option, many found out that their upcoming travel reservations had been canceled and no one manning the phone lines at the club to address their concerns, causing a sharp decline in support of the club, its leadership team, and proposed plan. Not surprisingly, when Ultimate Escapes released the results of the member poll, approximately two out of every three members voted against the change.

Earlier this morning, some Ultimate Escapes members received an offer from Quintess about an option to join their destination club by paying a "Transfer Fee" and annual dues. With Ultimate Escapes disavowing their association with such an offer, how Quintess came about the Ultimate Escapes member list and information is unknown, but there are some interesting details in the Quintess offer. For example, a "release of claims" document is required to be signed by members protecting Quintess from any actions or claims against Ultimate Escapes and those who received the Quintess proposal had customized plans specific to their Ultimate Escapes membership, indicating someone at Ultimate Escapes, CapitalSource, CRG Partners, or another party close to the situation was likely involved at some point. As Ultimate Escapes continues to work on other alternatives, we hope that this does not impact any of their dealings as they evaluate others offers currently on the table.

We will continue to report on this story and will echo Tousignant's and Karol's comments that at present, it might be a good time to wait to see if anything else changes drastically. We will report on the proposed offer by Quintess soon and ask our questions we have about the proposal.