Ultimate Resort Wins Right
To Buy Tanner & Haley Assets

A company headed by J. Joe Ricketts, chairman of online discount brokerage TD Ameritrade Holding Corp., has lost its bid for the real-estate assets of destination club Tanner & Haley, which filed for Chapter 11 bankruptcy protection.

A federal bankruptcy judge selected a rival offer from Ultimate Resort LLC over the bid from Mr. Ricketts's company, Preeminent Global Experience LP, Holly Etlin, Tanner & Hanley's chief restructuring officer, said in an interview Thursday.

During a federal-court hearing in Bridgeport, Conn., late Wednesday, Ultimate Resort sweetened its original offer of $98 million for Tanner & Haley's portfolio of high-end properties around the world to $100 million, while Preeminent increased an original bid of $108 million to $112 million, Ms. Etlin said.

After an informal auction earlier this month, Tanner & Haley and a committee of unsecured creditors, which includes many club members, selected Ultimate as the winning bidder for Tanner & Haley's assets. But earlier this week, Preeminent submitted a competing offer, which Judge Alan H. W. Shiff considered at Wednesday's hearing. "I continue to be confident that Ultimate is the best choice for Tanner & Haley members and I am extremely pleased that the judge agreed with us," Ms. Etlin said.

Both Ultimate, based in Kissimmee, Fla., and Preeminent, of Golden, Colo., had invited Tanner & Haley's 874 affluent members to join their clubs and continue using the Tanner & Haley properties without being required to put down membership deposits.

Ms. Etlin, who testified at the hearing, said Ultimate's bid would allow Tanner & Haley members to continue using the destination club homes for substantially less money than Preeminent's offer.

Tanner & Haley members would be able to join Ultimate Resort at an entry level by paying $10,000 in annual dues. That would allow them to use the club properties for 17 to 18 days, Ultimate Chief Executive Officer Jim Tousignant said in an interview Thursday.

Ms. Etlin said Preeminent's offer included entry-level annual dues of $17,000, which would enable members to use the club homes for approximately two weeks a year.

Mr. Ricketts was unavailable for an interview Thursday, a spokesman said. In a statement, Preeminent Chief Operating Officer, Jonathan M. Harding said, "We understand the pressures facing the various Tanner & Haley parties and rather than be discouraged by the decision to move in a different direction, we are emboldened by the favorable response we have received from so many quarters including many Tanner & Haley members."

Ultimate also agreed that Tanner & Haley members who join their club would recoup 60% of the club's membership deposit, which today range from $120,000 to $215,000, after staying with the club for five years. After eight years with the club, they could recoup 80%.

This could prove a significant enticement for Tanner & Haley's members, who are not expected to recoup much of the deposit money they put down to join Tanner & Haley before it filed for bankruptcy protection on July 23. Tanner & Haley members have until the end of the year to decide whether to join Ultimate Resort, Ms. Etlin said.

Email your comments to rjeditor@dowjones.com.