**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      DC 20549**




**FORM
      10-K**




**x**
            **ANNUAL
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**




**for
      the fiscal year ended December 31, 2006**




**OR**




** ̈**
            **TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**




**for
      the transition period from
             to
            .**




**COMMISSION
      FILE NUMBER: 333-118185**







**LAZY
      DAYS’ R.V. CENTER, INC.**


**(Exact
      name of registrant as specified in its charter)**


**Florida**
            **59-1764794****(State
                or other jurisdiction of**
              **incorporation
                or organization)**
            **(I.R.S. Employer**
              **Identification No.)****6130
                Lazy Days Boulevard****Seffner,
                Florida**
            **33584-2968****(Address
                of principal executive offices)**
            **(Zip
                Code)**




**(800)
      626-7800**


**(Registrant’s
      telephone number, including area code)**




**Securities
      Registered Pursuant to Section 12(b) of the Act:  None.**




**Securities
      Registered Pursuant to Section 12(g) of the Act:  None.**




1




Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act.




Yes  ̈ No x




Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or Section 15(d) of the Act.




Yes  xNo ̈





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
      during the preceding 12 months (or for such shorter period that it was required
      to file such reports), and (2) has been subject to such filing requirements
      for the past 90 days.


Yes  ̈ No x





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K is not contained herein, and will not be contained, to the best
      of the registrant’s knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-K or any amendment to
      this
      Form 10-K.


x




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




Large
      accelerated filer  ̈ Accelerated
      filer  ̈ Non
      accelerated filer x




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange


Act.):


Yes ̈Nox




As
      of
      March 31, 2007, the registrant had 100 shares of common stock outstanding
      100% of which is held by LD Holdings, Inc.




2


**TABLE
      OF CONTENTS**




**PART I**Item 1.
            Business
            5Item
                1A.
            Risk
                Factors
            15Item
                1B.
            Unresolved
                Staff
                Comments
            18Item
                2.
            Properties
            18Item
                3.
            Legal
                Proceedings
            18Item
                4.
            Submission
                of Matters to a Vote of
                Security Holders
            18**PART II**Item
                5.
            Market
                for Registrant’s Common
                Equity, Related Stockholder Matters and Issuer Purchases of Equity
                Securities
            19Item
                6.
            Selected
                Financial Data
            19Item
                7.
            Management’s
                Discussion and
                Analysis of Financial Condition and Results of
                Operations
            20Item
                7A.
            Quantitative
                and Qualitative
                Disclosures About Market Risk
            29Item
                8.
            Financial
                Statements and Supplementary
                Data
            30Item
                9.
            Changes
                in and Disagreements with
                Accountants on Accounting and Financial Disclosure
            52Item 9A.
            Controls
                and Procedures
            52Item
                9B.
            Other
                Information
            52**PART III**Item
                10.
            Directors,
                Executive Officers and
                Corporate Governance
            53Item
                11.
            Executive
                Compensation
            55Item
                12.
            Security
                Ownership of Certain
                Beneficial Owners and Management and Related Stockholder
                Matters
            65Item
                13.
            Certain
                Relationships and Related Transactions,
                and Director Independence
            66Item
                14.
            Principal
                Accountant Fees and
                Services
            70**PART IV**Item
                15.
            Exhibits,
                Financial Statement Schedules
            71




3


Unless
      the context requires otherwise, references to the “Company,” “we,” “us,” “our”
and “Lazydays” refer specifically to Lazy Days’ R.V. Center, Inc. and references
      to “Holdings” refer to LD Holdings, Inc., our parent.




**SPECIAL
      NOTE REGARDING FORWARD-LOOKING STATEMENTS**




Certain
      information set forth in this report contains “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of 1995.
      These statements relate to analyses and other information that are based on
      forecasts of future results and estimates of amounts not yet determinable.
      These
      statements also relate to our future prospects, developments and business
      strategies. The statements contained in this report that are not statements
      of
      historical fact may include forward-looking statements that involve a number
      of
      risks and uncertainties.




We
      have
      used the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,”
“may,” “plan,” “predict,” “project,” “will” and similar terms and phrases,
      including references to assumptions, in this report to identify forward-looking
      statements. These forward-looking statements are made based on our management’s
      expectations and beliefs concerning future events affecting us and are subject
      to uncertainties and factors relating to our operations and business
      environment, all of which are difficult to predict and many of which are beyond
      our control, that could cause our actual results to differ materially from
      those
      matters expressed in or implied by these forward-looking statements. Our actual
      results could differ materially from those anticipated by such forward-looking
      statements.





All
      forward-looking statements, including without limitation, management’s
      examination of historical operating trends, are based upon our current
      expectations and various assumptions. Our expectations, beliefs and projections
      are expressed in good faith and we believe there is a reasonable basis for
      them,
      but there can be no assurance that management’s expectations, beliefs and
      projections will result or be achieved. All forward-looking statements apply
      only as of the date made. Unless required by law, we undertake no obligation
      to
      update or revise forward-looking statements to reflect events or circumstances
      after the date made or to reflect the occurrence of unanticipated events.




4


**PART
      I**




**ITEM 1.
      BUSINESS**




**Our
      Company**




We
      are
      the largest single site recreational vehicle (“RV”) retailer in the world. In
      2006, we sold 6,875 new and pre-owned RVs in the retail market, including
      Class A motor homes, Class C motor homes, conventional trailers and
      fifth-wheel trailers. Class A motor homes are the highest priced class of
      vehicles in the RV industry and represented 84% of our 2006 new RV revenues.
      We
      also generate revenue from commissions earned on vehicle financing and insurance
      products we sell on behalf of third-party providers, from the service,
      maintenance and repair of RVs, from daily fees paid by customers who utilize
      our
      Rally Park campground facilities and rental revenue from our temporary housing
      rental program. We operate on a 126-acre site near Tampa, Florida that attracts
      more than 250,000 visitors annually. We generated 2006 revenues of $757.3
      million.




One
      of
      our primary strategies is to create “Customers for Life” by offering a unique
      purchasing experience that combines the largest single site RV inventory in
      the
      world, our one of a kind scenic facility with multiple amenities and our
      focused, process oriented approach to servicing the customer. Building a
      welcoming atmosphere that caters to the RV enthusiast community is an intangible
      element critical to our success, and our philosophy is thoroughly ingrained
      in
      and continually reinforced throughout our corporate culture at every level.
      Our
      unique customer focused business model has resulted in a loyal, stable and
      growing customer base and an unrivaled reputation within the RV community.
      Our
      ability to generate a significant portion of our annual unit sales from repeat
      business and word-of-mouth referrals is testimony to the success of this
      approach.




To
      enhance our customers’ RV experience, we have developed our facilities with
      their needs in mind and as a result our site has become a destination location
      for RV owners throughout the United States, Mexico and Canada. Our facilities
      feature a number of unique attractions including a 1,200-site outdoor show
      space
      of new and pre-owned RVs, a 230-bay RV servicing facility with a 6,600 sq.
      ft.
      Customer Service Pavilion that includes a professional full-time concierge
      station, complimentary Starbucks coffee concession, luxurious seating areas,
      flat screen televisions and wireless internet connections. At our 299-site
      Rally
      Park, we hold over 100 rallies each year and provide our visitors the
      opportunity to meet and spend time with other RV enthusiasts. In addition,
      visitors to our site can enjoy complimentary meals at our Italian style Café or
      visit our Learning Center for complimentary seminars. Customers who have
      purchased a high-end Class A motor home enjoy the exclusive services and
      amenities of our Crown Club facility and all other buyers become a member of
      our
      exclusive Club LazyDays. Finally, there are additional attractions located
      adjacent to our facilities that appeal to RV owners including a Camping World
      retailer, a Flying J Travel Plaza and a Cracker Barrel restaurant. These
      features and our customer focused philosophy cater to the RV enthusiast
      community and have allowed us to attract potential RV purchasers from across
      the
      United States. In 2006, 36% of our unit sales were to customers that reside
      outside the state of Florida.






Unique
          Business Model and Customer Focus. Our business model was developed to
          serve our customers and create “Customers for Life.” An RV purchase is often
          one of our customers’ most significant purchase decisions and one that we
          strive to make enjoyable. Our philosophy provides for a unique customer
          experience to ensure satisfaction and generate loyalty. Additionally, we
          offer
          numerous amenities to visitors and customers at our site whether or not
          they
          are actively seeking to purchase an RV. We believe our unique business
          model
          has allowed Lazydays to become a destination site for RV enthusiasts and
          RV
          purchasers from all over North America.


Process
          Driven Sales Organization. We have a talented and experienced sales
          organization with approximately 150 sales professionals. Our sales
          professionals benefit from at least one hour of training each business
          day on
          specific product features and selling techniques. Our sale professionals’
          compensation structure is 100% commission based and is driven by profit
          achievement and customer satisfaction ratings. Each salesperson follows
          a
          carefully scripted process which we have developed over time. Our sales
          process begins with a customer interview to determine which products will
          appeal to the customer. The salesperson then escorts the customer through
          the
          product selection process by touring our facilities and focusing the customer
          on three to five specific models the sales person determined best meets
          the
          customer’s needs. Once a selection is made, the salesperson coordinates with
          the desk manager to value the customer’s trade-in, if applicable, and
          determine the sales price. We contact each customer, on average, eight
          times
          within the first twelve months following their purchase to ensure satisfaction
          and create customer loyalty. In 2006, $694.2 million of our revenues were
          generated from sales of new and pre-owned RVs.


- Finance
        and Insurance Product Sales. Upon completion of the sale negotiation, the
        customer is escorted to a business manager who documents the purchase and
        offers third-party financing, insurance and warranty products. In 2006,
        approximately 55.2% of our customers obtained their vehicle financing through
        Lazydays, the interest on which is often tax deductible as a person’s primary
        or secondary residence. We arrange financing from eleven lending institutions
        and offer insurance products from seven insurance underwriters. In 2006,
        $21.2
        million of our revenues were generated from commissions on third-party finance
        and insurance products.



- Value-Added
        Customer Benefits and Customer Dedication. We provide each of our
        customers complimentary benefits with an RV purchase that we estimate have
        an
        aggregate value of over $8,000. Our delivery team performs a 130-point
        inspection of every motor home and a 100-point inspection for every towable
        vehicle. We also provide our customers with an optional driver confidence
        course, assistance in registering and obtaining title for their RV, a
        complimentary one year membership in various RV clubs and campgrounds and
        discounts at retailers frequented by RV enthusiasts.



5


- Marketing.
        The most important component of our marketing effort is word-of-mouth
        marketing among our customers and other RV enthusiasts. We actively cultivate
        referrals from our customers with our proprietary “Friends and Family”
        referral program. Their referral efforts are acknowledged on our “Wall of
        Honor”, which prominently displays their names. We target multiple direct
        marketing efforts at prospective buyers utilizing our proprietary database
        of
        2,000,000 street addresses and 100,000 email addresses for current and
        potential RVers in order to drive in-person visits and telephone contacts.
        We
        have a print advertising campaign in camping and RV magazines. In 2006, we
        launched Lazydays RV Showcase magazine. The magazine is published every two
        months and targets RV owners and aspirants. Our largest source of customer
        traffic is our website, www.lazydays.com, which features real-time displays
        of
        our inventory updated automatically every 10 minutes and offers customers
        an
        opportunity to browse our current product selection. These multi-faceted
        marketing initiatives generate significant customer traffic.



- The
        Café. The Italian style Café is located in our main dealership building
        and serves over 300,000 complimentary meals to customers and visitors each
        year, including customers visiting our facilities for service and repair,
        sales prospects and RallyPark guests. Importantly, the layout of our site
        requires our RallyPark guests to traverse our product selection in order
        to
        reach the Café. As a result, potential customers often approach sales
        representatives before or after the meal service to inquire about our
        products.



- CrownClub. Our
        CrownClub facility opened in December 2003 as an additional exclusive
        benefit to our customers who purchase a high-end (approximately $300,000
        and
        above) Class A motor home. CrownClub qualifying new and pre-owned unit
        purchasers receive membership privileges, of three and two years,
        respectively, which we believe helps to motivate our customers to
        trade-in on a more frequent basis. CrownClub membership offers access to
        43
        premier service bays and a 17,000 square foot clubhouse, including a lounge,
        dining room, library, business center and swimming pool. CrownClub members
        enjoy complimentary upscale meals and our full-service bar. Members also
        receive other amenities such as an exterior wash upon service completion,
        invitations to CrownClub reunions held at exclusive RV resorts throughout
        the
        U.S. and certificates for 20 free nights at RallyPark.  As of
        December 31, 2006, we had more than 2,640 CrownClub members.



- Club
        Lazydays. In 2006 we introduced Club Lazydays, a one of a kind club
        that provides exclusive benefits to anyone who purchases an RV from us. 
        Benefits include a luxurious Service Pavilion; a dedicated toll free number
        for member assistance; complimentary breakfast and lunch; a personal service
        advisor; invitations to Club rallies; discounts on stays at RallyPark, 
        and affiliated membership to other RV clubs such as Thousand Trails, Family
        Motor Coach Association, Camping World President’s club and other product
        specific clubs.



- RallyPark.RallyPark is a 299-site RV campground located at the Lazydays facility.
        Each site offers wireless internet access, utilities, cable TV and a morning
        newspaper. More than 100 rallies are held at RallyPark each year and we
        believe RallyPark is the preferred rally site for many national, regional
        and
        state RV clubs. Our 12,000 square foot climate-controlled RallyCenter can
        accommodate up to 500 people and is utilized for dinners, meetings, award
        ceremonies and live entertainment. We also offer a screened and heated
        swimming pool and Jacuzzi, tennis courts, horseshoe pits and shuffleboard
        lanes for our guests. In 2006, $1.5 million of our revenues were
        generated from fees charged to RallyPark guests.



- Quality
        Service and Repair Programs. We have a 230-bay servicing area including 40
        premier Crown Club bays and what we believe is the largest RV collision repair
        center in the U.S. We also offer other special services that are performed
        in
        our cabinet shop, chassis shop, windshield repair shop and upholstery shop.
        Our staff is highly qualified and has over 98 of an estimated 400 RVIA/RVDA
        Certified and Master Certified technicians in the state of Florida. We have
        an
        extensive parts inventory which, as of December 31, 2006, was
        approximately $1.7 million and we have access to many hard-to-find parts.
        In 2006, $38.8 million of our revenues were generated from service and
        repair.




- Premier
        Customer Profile. Our business model allows us to seek and maintain
        “Customers for Life.” Our target customers are RV enthusiasts who we believe
        represent the substantial majority of our customer base and differ from
        recreational RV consumers in that they are seeking a lifestyle centered on
        the
        RV. RV enthusiasts are typically financially secure couples in the
        55-74 year-old age group who are seeking an RV lifestyle that involves
        frequent travel, substantial time living in their RV and the opportunity
        for
        interaction with other RV enthusiasts. Approximately 70% of our customers
        seek
        to trade-in an RV, and many of our RV enthusiast customers are purchasing
        their third or fourth RV and may use their RV as their primary residence.
        We
        are intently focused on improving the likelihood that when an RV enthusiast
        does purchase an RV they purchase it from Lazydays. Our continuing success
        in
        this endeavor was demonstrated by the 22% of our unit sales which were
        generated from repeat customers in 2006. Our customers generally purchase
        RVs
        at higher price points, as evidenced by our average purchase price for retail
        sales of $100,973 in 2006 compared to an industry average of approximately
        $37,373 in 2006. We also believe our name and reputation are being
        disseminated to other RV enthusiasts within this community.



6


- Economies
        of Scale. We believe that we generate approximately three times the
        revenue of the next largest single-site dealership. We offer over 150 distinct
        new RV models, including Class A motor homes, Class C motor homes,
        conventional trailers and fifth-wheel trailers, which we believe is the
        broadest product offering at any single-site retailer. Our 1,200-site outdoor
        show space includes new products from leading manufacturers, including Monaco
        Coach Corporation, Fleetwood Enterprises, Inc., Winnebago
        Industries, Inc., Carriage, Inc., Thor Industries, Inc.,
        National RV Holdings, Inc., Glendale RV, Forest River RV, Inc. and Tiffin
        Motor homes, Inc. We attract potential RV purchasers from across the
        United States, as evidenced by the 54% of our Class A unit sales in 2006
        made to customers that reside outside the state of Florida. Our scale also
        allows us to provide one-stop shopping for our customers by offering
        competitive third-party financing, insurance and warranty products.
        Approximately 70% of our customers seek to trade-in an RV which provides
        us
        with a consistent supply of pre-owned vehicles to offer our customers.
        Finally, the wholesale network of over 1,500 dealers that we have developed
        since 1994 provides us with a reliable system for managing our pre-owned
        inventory and allows us to accept and accurately value customer
        trade-ins.



- Favorable
        Relationships with Manufacturers. We believe our supplier relationships
        are excellent. In 2006, we were the largest retailer for five of the nine
        manufacturers represented by our new RV product offering. Our product offering
        of Class A motor homes represents manufacturers that command a 67% share
        of the U.S. Class A market. The manufacturers we represent have over 26
        full-time sales and service representatives stationed at our site to educate
        our sales force, assist customers in their purchase decision and assist in
        servicing vehicles. We have favorable multi-year contracts which provide
        exclusive geographical distribution rights for many manufacturers’ products,
        ranging from the Tampa, Florida area to the southeastern United States. We
        have maintained long-term relationships with these manufacturers across
        various levels within each organization, ranging from frequent management
        contacts to manufacturer production personnel visiting our facilities to
        assist in delivering RVs and addressing quality issues.



- Experienced
          Management Team. We
          are
          led by an experienced management team with our top7managers
          having an aggregate 70 years experience in the RV industry and average
          tenure
          at the Company of 7 years.Our
          team has extensive retail sales, marketing, operations and financial
          experience and is skilled at driving growth and creating a unique customer
          experience.Our
          senior management group is responsible for developing and implementing
          our
          business strategy and focusing on increasing profitability and our incentive
          systems ties their compensation to our financial
          performance.

**Business
      Strategy**




Our
      principal business strategies include the following:




- Maintain
        High Levels of Customer Service. Our business is differentiated from other
        retailers due to our customer focus. We believe customer satisfaction is
        critical to our continued growth and profitability. Over the past ten years,
        we have transformed our business from a large RV retailer into an RV
        enthusiast destination site through the development of our sales and service
        processes and our one of a kind facilities including, most recently, the
        addition of our Customer Service Pavilion, Café and LearningCenter and
        remodeling of our sales offices. We intend to continue to upgrade and enhance
        our facilities and to add additional site amenities to increase customer
        satisfaction. We believe that our customer-centric business strategy will
        continue to attract visitors and allow us to grow our RV enthusiast customer
        base.
- Favorable
        Demographics. We believe the aging of the “baby boomer” generation will
        result in substantial increases in RV sales over the next 5-10 years.
        Overall RV ownership rates have historically been highest in the
        55-64 year-old age group with penetration rates of approximately 14%.
        This age group is expected to grow 45% from 2002 to 2010. Our management
        team
        believes our existing 126-acre site can accommodate a 55% increase in annual
        RV deliveries and we plan to continue to expand our product offering to
        include additional manufacturers’ product lines as dictated by customer
        preferences.



- Generate
        and Convert Sales Opportunities. We continually seek to increase the
        number of sales prospects through creative marketing initiatives including
        effectively utilizing and enhancing our destination location appeal, our
        proprietary database and website. We employ systems that continually monitor
        and improve nearly all of our customer interactions and all facets of our
        sales processes in order to increase the rate at which we convert these sales
        leads into RV purchases. In 2006, approximately 19% of the over 36,000
        prospective customers who actively pursued an RV purchase from us actually
        purchased an RV. We will continue to work to improve our customer focused
        model by having daily training sessions with our sales force to improve sales
        techniques and product knowledge, ensuring that a consistent message is
        delivered to our customers. We will also continue to focus on high-margin
        sales opportunities, including Class A motor home sales and sales of
        finance, insurance and warranty products.



7


**Products**




*Overview*




RVs
      can
      be categorized into two vehicle segments: motor homes and towables. Motor homes
      are self-contained and are built on a motor vehicle chassis. They are designed
      to provide a mobile living environment for recreational, travel, or camping
      use.
      Towables are also self-contained, wheeled units designed to be towed by a
      motorized vehicle and are generally less expensive and smaller than motor homes.




*New
      Vehicles*




*Motor
      homes*




*Class A.* Class A motor homes are the largest and most luxurious motor homes. These
      motor homes are built on specially designed chassis and often are outfitted
      with
      amenities such as washers/dryers, security systems, TVs, DVD players, satellite
      dishes and hydraulic leveling systems. Newer Class A motor homes are
      generally equipped with multiple “slide-outs,” which allow the owner to extend
      the exterior walls of the RV when parked to dramatically enlarge the interior
      space. These motor homes range in length from 21 to 45 feet and sell for between
      $50,000 and over $1 million and represented 84% of our 2006 new vehicle
      revenues.




Diesel-powered
      Class A motor homes, including high line and standard diesel-motor homes,
      are large and luxurious vehicles with a price range of $100,000 to more than
      $1 million. The diesel engines of these RVs provide numerous advantages
      over gas engines, including greater horsepower, increased fuel mileage and
      longer life. High line diesel vehicles are premium Class A motor homes with
      diesel engines and premier living facilities and amenities. The high line
      vehicles are typically priced above $250,000. Standard diesel vehicles have
      similar engines to high line motor homes, but generally contain fewer amenities
      and are priced at a lower point.




Gas-powered
      Class A motor homes are considered entry-level Class A motor homes and
      are priced from $75,000 to $175,000. Class A gas products appeal primarily
      to the part time RVer who is looking to enjoy the RV experience at an affordable
      price. Built on a less robust chassis than diesel products, gas motor homes
      tend
      to offer less carrying capacity and a slightly rougher ride than diesels.
      Interior comfort is not sacrificed, however, as Class A gas products are
      available with all the high end amenities including multiple slide-outs,
      luxurious furnishings, flat screen TVs and satellite antennas.





*Class C.* Class C motor homes, also known as “mini-motor homes,” are constructed on
      an automotive manufactured van frame with an attached cab segment. Similar
      to
      Class A motor homes, these RVs, which range in length from 20 to 32 feet,
      offer full kitchen, sleeping and dining facilities and are increasingly
      featuring “slide-outs.” Class C motor homes sell for between $40,000 and
      $125,000 and represented 6% of our 2006 new vehicle revenues.




*Towables*




*Conventional.* Conventional travel trailers range in length from 12 to 39 feet and generally
      include all of the facilities found in a motor home. As with all towables,
      an
      advantage of a conventional travel trailer is that it can be detached from
      a
      car, pickup truck, or van at the destination, thus making the towing vehicle
      available for other uses. In addition, six-cylinder engine cars are now capable
      of towing the newer, lightweight travel trailer models. New travel trailers,
      most of which can sleep up to eight people, are priced between $9,000 and
      $76,000 and represented 2% of our 2006 new vehicle revenues.




*Fifth
      Wheel.* Fifth-wheel travel trailers, which range in length from 21 to 42 feet, are
      similar to conventional travel trailers in terms of size and amenities, but
      the
      two differ in their methods of attachment to the towing vehicle. While a
      conventional travel trailer is designed to be mounted on a standard car, truck,
      or van hitch, a fifth-wheel travel trailer is attached to a pickup truck by
      a
      special hitch connected to the truck bed. This design provides greater
      maneuverability and reduces the overall length of the combined vehicles.
      Fifth-wheel travel trailers sell for between $12,000 and $100,000 and
      represented 6% of our 2006 new vehicle revenues.




*Pre-Owned
      Vehicles*




Sales
      of
      pre-owned RVs contributed 33% of our revenues during 2006. With approximately
      70% of our customers providing a trade-in RV, we benefit from a steady, high
      quality flow of available pre-owned inventory. We sell our pre-owned vehicles
      to
      both retail customers and, on a wholesale basis, a network of RV and automotive
      dealers. Retail customer’s purchase pre-owned vehicles because they can get a
      high quality vehicle at a lower price. We enhance the value of pre-owned
      vehicles by fully servicing them before offering them for resale.




Our
      practice of wholesaling RVs to other dealers allows us to manage our pre-owned
      vehicle inventory optimally and limit our risk of carrying pre-owned vehicles
      for extended time periods. With access to over 1,500 dealers, we can offer
      higher values for trade-ins and mitigate our trade-in risk by selling
      slow-moving pre-owned RVs through this large dealer network.




The
      sales
      of all categories of pre-owned inventory through our wholesale network
      represented 8% of total pre-owned vehicle revenues in 2006. Of our total
      pre-owned vehicle revenues in 2006, retail sales of pre-owned Class A motor
      homes represented approximately 77%, retail sales of Class C pre-owned
      motor homes represented 6% and retail sales of pre-owned fifth wheel and
      conventional towables and other miscellaneous vehicles represented the remaining
      9%.




8


**Trailer
      Rental Program for Temporary Housing**




As
      a
      result of the active Florida hurricane season in 2004, we developed a rental
      program which targeted displaced hurricane victims in need of temporary housing.
      In 2004, 682 conventional travel trailers were rented. Rental terms ranged
      from
      three to six months with extended terms available. We continued the program
      in
      2005 and expanded rental units to include Class C motor homes. In 2005, we
      rented an additional 156 travel trailers and 25 Class C motor homes as temporary
      housing following hurricanes. Rental revenue totaled $0.9 million in 2006.
      At
      the end of 2006, we had 3 outstanding rental units. We expect this program
      to
      conclude in 2007.




**Service
      and Repair**




We
      operate 230 service bays, providing on site general RV maintenance and repair
      work to customers. The service and repair department is divided into two areas:
      the “make ready” process for deliveries of recently purchased new and pre-owned
      retail units and post-delivery service. We also maintain a body shop, cabinet
      shop, chassis shop and windshield repair shop with highly skilled, RVIA/
      RVDA-certified technicians and specialized equipment and facilities. In addition
      to preparing several thousand RVs for delivery to customers each year, our
      service and repair operations provide general RV maintenance and repair services
      and manufacturer paid work performed under warranty to approximately 10,000
      customers annually. Furthermore, with over $1.7 million of parts and
      accessories inventory, in addition to a fully stocked on-site Camping World
      store, Lazydays provides new and pre-owned RV buyers the option of dealer
      installed accessories, such as tow hitches, satellite dishes and specialized
      suspension systems that can be included in each buyer’s financing. Lazydays’
average service and repair customer spends approximately $1,100 per visit.




We
      frequently welcome customers who travel from across the country to have their
      vehicles serviced by our team of service and repair professionals. As a result,
      the service and repair department serves as a means of attracting potential
      customers to the Lazydays facilities and offers greater additional sales
      opportunities for us. Our service and repair department generated
      $38.8 million of revenue in 2006.




**Financing
      and Related Services**




We
      provide assistance to customers in arranging financing for their RV purchases
      through a variety of lenders. Revenues from financing, warranty and extended
      warranty products and related services have increased from $14.8 million in
      1999 to $21.2 million in 2006.




*Financing*




Lazydays
      generates commission based revenue from its financing services by placing the
      loans with one of eleven independent lending institutions. The interest on
      these
      loans is often deductible to our customers as a mortgage for tax purposes for
      a
      primary or secondary residence. During 2006, approximately 55.2% of our
      customers obtained their vehicle financing through Lazydays. By leveraging
      the
      volume of our financing customers, we are able to negotiate favorable rates
      for
      our customers with third-party lenders. Financing fee based revenues represented
      approximately 65% of 2006 financing and related services revenue.




*Insurance
      and Extended Warranties*




We
      offer
      extended warranties and various insurance products for new and pre-owned RVs.
      As
      with our financing related products, we are paid a fee for placing the warranty
      or insurance product with one of seven different insurance underwriters.
      Approximately 46% of our customers purchased extended warranties during 2006,
      and we offer other insurance products, including tire, life and physical damage
      insurance. Together, revenue from insurance and warranties represented
      approximately 35% of our 2006 financing and related services revenue.





9


**Rally
      Park and Related Services**




Rally
      Park is our full service RV campground that includes a 12,000 sq. ft. recreation
      hall, screened-in heated pool and Jacuzzi, computer room and commercial kitchen
      facilities and exists primarily to attract visitors to Lazydays and enhance
      their overall experience. Our Rally Park attracts over 48,000 visitors each
      year
      and has 299 full hook-up sites which provide utilities, wireless internet
      access, cable TV and a morning newspaper.




More
      than
      100 rallies were held at Rally Park in 2006, with many sponsored by us as a
      marketing promotion tool to create additional customer traffic. We also
      prominently display marketing and promotional materials throughout the park.
      All
      park guests are invited to the Café in the main building for complimentary
      breakfast and lunch with a shuttle service running frequently between the park
      and the dealership. Our 12,000 square foot climate-controlled Rally Center
      can
      accommodate up to 500 people and is utilized for dinners, meetings, award
      ceremonies and live entertainment. Rally Park represents an important and
      successful marketing tool for us. In 2006, revenues of $1.5 million in fees
      were
      generated from Rally Park visitors.




**Served
      Markets**




We
      generated approximately 64% of our retail deliveries from Florida residents
      in
      2006, the third largest RV buying state in the United States, and we are by
      far
      the dominant player in the Florida market with a 40% share of Class A motor
      home unit sales in 2006. While we estimate that Florida is Lazydays’ primary
      market, we have experienced great success penetrating other markets, with unit
      sales to residents outside the state of Florida reaching 36% of our retail
      deliveries in 2006. We believe our U.S. market share in Class A motor home
      unit sales in 2006 was approximately 6%, and represents a substantial
      opportunity for further market penetration and expansion for us.




**Target
      Customer**




We
      estimate that approximately 70% of our customers have previously owned an RV.
      These customers have adopted the RV lifestyle and do not generally view RVs
      as
      luxury or recreational items, as the broader market may view them. Accordingly,
      for many of our customers, the RV represents a necessary purchase that will
      occur periodically as the time comes to trade in and upgrade the vehicle.
 Consistent with their RV enthusiast lifestyle, Lazydays customers are
      frequently repeat purchasers. Management estimates that Lazydays’ average
      customer owns his or her RV three to four years before trading it in, compared
      to an estimated industry average of approximately seven years In addition,
      the
      RV lifestyle includes frequent social interaction between RVers that creates
      an
      environment in which word-of-mouth marketing becomes a powerful tool.




While
      our
      typical customers are in their mid-fifties, we have an increasing number of
      customers in their mid-40s with young children. RV ownership provides this
      younger customer group access to relatively safe and economical vacation and
      travel alternatives. While this younger demographic is currently a small portion
      of the RV buying group, management believes its growing interest in RVs
      demonstrates the broadening appeal of RVs in general and represents an
      opportunity for us to penetrate a greater portion of the population.





**Sales
      Overview**




The
      entire Lazydays culture is built on the sales philosophy of making “Customers
      for Life.” All Lazydays employees are committed to providing premier customer
      service and developing a relationship with the customer that ensures that he
      or
      she will return to Lazydays for all future RV purchases and service needs.
      This
      culture is evident in the way each customer is greeted by every employee with
      the phrase, “Welcome to Lazydays.” Though ingrained deeply in all facets of the
      business, the Lazydays culture is most readily apparent to customers in their
      interaction with our sales force.




Our
      direct sales organization is comprised of eight sales managers who oversee
      approximately 150 salespeople, as well as managers that oversee other aspects
      of
      the sales process, such as Internet, telephone and wholesale sales, pricing
      and
      the appraisal of trade-in units. Each sales manager is responsible for a team
      of
      salespeople and is compensated based on team and Company performance goals.
      Additionally, each sales manager administers a relationship with a manufacturer
      by understanding new products and monitoring inventory levels.




Our
      salespeople are divided into three levels based on customer satisfaction and
      sales performance. Our sale professionals’ compensation structure is 100%
      commission based and is driven by profit achievement and customer satisfaction
      ratings. In 2006, our compensation per year per salesperson averaged
      approximately $90,000 and the top salesperson earned $200,000, which we believe
      is significantly higher than at other dealerships in the country, thus allowing
      us to attract and retain a high quality sales force. Because of the
      opportunities offered to our salespeople, we have historically maintained low
      turnover within our sales staff.




10


**Sales
      Organization**




Our
      sales
      team has consistently improved its success in converting sales opportunities
      into RV deliveries over the years, as management continuously refines the sales
      process. From 2000 to 2006, we improved our delivery ratio (the number of sales
      divided by the number of sales opportunities or “ups”) from 16.9% to 19.0%.
      Through the ongoing development of the sales process and training of personnel,
      management believes its sales force’s productivity will continue to improve.




Our
      success in developing and maintaining a productive sales force is a function
      of
      our ability to execute our “Customers for Life” sales philosophy. We have
      identified and outlined a number of important tenets that embody this philosophy
      and provide a blueprint for the operation of the sales organization. At a high
      level, these include our keys to building a great company, such as “find and
      keep great people” and “be easy to do business with.” The importance of premier
      customer service is emphasized through our Golden Rule of Customer Service,
      the
      Ten Rules of Customer Service and the Thirteen Keys to Being the Best at
      Customer Service. These rules are reinforced every week through sales training
      sessions and ensure that salespeople execute our sales philosophy. This
      philosophy defines our culture, which is built around a focus on the needs
      and
      wants of the customer, a constant pursuit of premier customer service and the
      consistent execution of a proven sales system. The embodiment of this philosophy
      is the greeting of “Welcome to Lazydays,” that each employee delivers to each
      and every customer.




We
      strive
      to ensure that our sales personnel are consistent in their approach to the
      customer and in their application of these tenets through extensive training.
      Each salesperson must complete an initial two-week customer service and sales
      process training program. Thereafter, all salespeople are required to attend
      daily one-hour product and selling skills training sessions. The emphasis on
      continuous training ensures that sales personnel are knowledgeable in their
      representation of the products and skilled in their approach to the customer.




11


**Marketing
      Overview**




Lazydays
      attracted over 250,000 visitors to its complex and generated over 36,000 sales
      opportunities in 2006. This traffic is generated through a comprehensive program
      that includes referrals, direct mail, television and print advertising, rallies
      and trade shows, marketing partners and the Lazydays website. All of our
      marketing work, including the development of strategies and concepts, the
      maintenance of the customer database and the design and layout of
      advertisements, is performed in-house, with the exception of high volume
      printing and television production. By performing the majority of our marketing
      functions internally, we are able to manage our marketing cost effectively.
      We
      spent $6.6 million on our marketing efforts in 2006, or 0.9% of total
      revenues, a level that is consistent with historical expenditures as a
      percentage of revenues.




*Referrals*




Customer
      referrals are our most productive and inexpensive advertising source. The
      introduction of the Lazydays Friends & Family Program in July 1997
      served as a catalyst for referral based business. The program promotes referral
      activity by rewarding customer loyalty and referral business with awards and
      recognition for each referral that leads to a sale. As customers make new,
      qualified referrals, they receive rewards, such as complimentary stays at Rally
      Park for Friends & Family rallies, award certificates cash prizes. In
      addition, based on their number of referrals, Friends & Family members
      have their names prominently displayed on plaques along the Wall of Honor in
      the
      lobby of the main dealership building.




*Direct
      Mail, Print and Television*




We
      manage
      a proprietary database of approximately 2.0 million RV owners and potential
      owners to maintain regular mail-based contact with existing and potential
      customers. We have used direct mail marketing for the past ten years and email
      marketing for the past three years, advertise in numerous industry publications
      and, on a limited basis, through local television.




We
      design
      our own direct mail marketing materials in-house and have millions of
      postcards, posters, brochures and mailers printed each year to generate interest
      in our RVs. Our largest publication is our bi-monthly Lazydays RV Showcase
      which
      was launched in December 2006. Lazydays RV Showcase lists RVs for sale at
      Lazydays and targets the fastest growing segment of RV owners and aspirants
      -
      the baby boomer generation. The magazine has an annual circulation of 1,500,000.
      We also send our customers personalized notes each year for a variety of
      occasions, including the anniversary of an RV purchase, to maintain strong
      customer goodwill.




*Internet
      Website*




The
      Lazydays website is a user-friendly marketing and informational tool. Our
      website allows our customers to view new and pre-owned RV photos and
      specifications within minutes after the vehicle becomes available for sale.
      Users can search for available RVs by keyword, brand, class, make and model,
      as
      well as learn more about the numerous value added benefits offered by us. Users
      have the ability to purchase our RVs without visiting our facility by learning
      about products online and by calling or emailing Lazydays to further their
      inquiry. Additionally, users can obtain an estimate of the value of their
      trade-ins prior to arriving at Lazydays.




*Rallies
      and Trade Shows*




Rallies
      and trade shows serve as an ideal opportunity to market Lazydays to concentrated
      groups of RV enthusiasts. Hundreds of rallies and trade shows take place
      throughout the U.S. each year. Lazydays attends over 40 off-site rallies each
      year. We send sales representatives and a selection of RVs to the rallies and
      trade shows to promote products, answer questions and build excitement around
      the dealership. In addition, approximately 100 RV rallies are held each year
      at
      Rally Park in which we can exclusively display and promote our products and
      value-added benefits.




**Marketing
      Partners**




We
      have
      developed joint-marketing relationships with various companies that are involved
      directly or indirectly in the RV industry. For instance, we have a relationship
      with RV accessory and camping supply retailer Camping World, which has a store
      next to Lazydays and benefits from a steady flow of prospective customers as
      a
      result of the location. Similarly, Lazydays and other business partners benefit
      one another by offering complimentary products and services.




The
      following chart lists our primary marketing partners:




**Marketing
      Partners**




**Partner**
            **Description**Camping
                World, Inc
            Retailer
                of RV accessoriesThousand
                Trails, Inc
            Manager
                of membership campgroundsFamily
                Motor Coach Association
            RV
                owners clubFantasy
                RV Tours
            Conducts
                guided RV toursWorkhorse
                Custom Chassis LLC
            Manufacturer of heavy duty custom chassisSpartan
                Chassis, Inc.
            Manufacturer
                of heavy duty custom chassis




12


**Suppliers**




Over
      the
      course of our operating history, we have developed strong relationships with
      the
      industry’s leading RV manufacturers. We are supplied primarily by nine major RV
      manufacturers that rely on us as a primary point of distribution.




For
      most
      product lines and manufacturers, we are the leading dealership in terms of
      sales
      volume. Manufacturers are highly dependent on us for their Florida sales, an
      important territory for the RV industry. In 2006, we were responsible for 58.5%
      of our suppliers’ total Florida Class A RV sales. We have won numerous
      supplier awards for our excellence in sales and service, including Fleetwood’s
      Circle of Excellence Award ten times and Winnebago’s Circle of Excellence Award
      every year (20 times) since the award’s inception.




We
      have
      negotiated favorable long term dealer agreements and reasonable sales goals.
      Dealer agreements provide exclusive sales rights for manufacturers’ products
      over extended geographic regions ranging from the local Tampa area to the
      southeastern United States. In addition, we believe our size and market presence
      ensure that we have top priority with our suppliers and a consistent supply
      of
      RVs, even during times of production shortages.




Importantly,
      our RV suppliers also support our ability to carry an extensive inventory of
      vehicles by providing a backstop to our floor plan financing. The manufacturers
      have an agreement with our floor plan lenders to repurchase unsold inventory
      at
      a value of up to 100% of the original cost of the vehicles under certain
      circumstances.




We
      also
      have the benefit of over 26 onsite manufacturer representatives from the major
      RV manufacturers, depending on the season. Manufacturer sales representatives
      will answer customer inquiries specific to their products, lend credibility
      to
      Lazydays’ operations and assist in the sale of products and training of
      salespeople, keeping us informed of new product innovations and fostering strong
      relationships with the manufacturers.




**Wholesale
      Vehicle Network**




Approximately
      70% of our RV purchases (new and pre-owned) are accompanied by a trade-in.
      The
      large number of pre-owned trade-ins that we receive assures us of a steady
      supply of high quality pre-owned vehicles. We believe that we are able to pay
      more for pre-owned RVs than our competition because of our scale. Our steady
      supply of customers, coupled with our access to a proprietary network of more
      than 1,500 dealers, helped make us the top single-site pre-owned RV dealership
      in the U.S. Additionally, the wholesale network allows us to optimize our
      inventory carrying levels by disposing of old or unwanted trade-ins through
      this
      channel.




**Management
      Information Systems**




In
      2006,
      we replaced our key customer and business information systems in order
      to fully integrate our customer relationship, sales, finance, insurance,
      service, accounting, purchasing and inventory management information and
      processes. These new systems provide real-time information and are integrated
      with our web site, which offers our customers the ability to browse our
      continuously updated inventory, trigger our team to search for RVs matching
      buying criteria, shop for parts and even “Build Their Own RV” using the
      industry’s first such application. This new foundation for growth allows for
      enhanced customer relationships, marketing and sales effectiveness, operational
      efficiency and management information. Going forward, we expect to integrate
      our
      business systems with those of our manufacturing, finance and other business
      partners.




**Employees**




We
      benefit from a loyal and dedicated non-union workforce of 722 full-time and
      8
      part-time employees as of December 31, 2006 and have never experienced a
      work stoppage. Each of these individuals is critical to sustaining a culture
      that is unique in the industry. We work to ensure that every employee shares
      our
      vision and commitment to customer service and welcomes each visitor with the
      phrase, “Welcome to Lazydays.”




We
      offer
      competitive compensation and benefit plans to employees working more than
      30 hours per week. Our benefits include a defined contribution
“401(k)” plan with discretionary company matching, medical, and dental, pharmacy
      and vision insurance, short-term and long-term disability and life insurance,
      a
      pre-tax premium payment plan with flexible spending accounts, post-tax voluntary
      benefit (AFLAC) and vacation up to three weeks after seven years of employment.




We
      have
      never experienced any significant labor shortages nor had any difficulty in
      obtaining adequate replacements for departing employees. We consider our
      relations with our employees to be good.




13


**Intellectual
      Property**




We
      have
      registered, and are in the process of registering, various trademarks and
      service marks with the U.S. Patent and Trademark Office, including “Lazy Days RV
      Super center,” “Tire Re-Nu,” “CrownClub” and “RallyPark.”




**Government
      Regulation**




Our
      operations and business practices are subject to regulation at the federal,
      state and, in some cases, local levels. State and local consumer protection
      laws
      and regulations govern our sales, advertising, financing, insurance sales and
      other trade practices.




The
      adoption of more stringent statutes and regulations, changes in the
      interpretation of existing statutes and regulations or our entrance into
      jurisdictions with more stringent regulatory requirements could curtail some
      of
      our operations. It could also deny us the opportunity to operate in certain
      locations or restrict products or services, including terms of finance and
      insurance products offered by us. Various federal, state and local regulatory
      agencies, including the Occupational Safety and Health Administration, the
      United States Environmental Protection Agency and similar federal and local
      agencies, have jurisdiction over the operation of our dealerships, repair
      facilities and other operations with respect to matters such as consumer
      protection, workers’ safety and laws regarding protection of the environment,
      including air, water and soil. The failure to maintain all requisite licenses
      and permits and comply with all applicable federal, state and local regulations,
      could limit our ability to operate our business.




As
      with
      vehicle dealerships generally, and parts and service operations in particular,
      our business involves the use, handling, storage and contracting for recycling
      or disposal of hazardous or toxic substances or wastes, including
      environmentally sensitive materials, such as motor oil, waste motor oil and
      filters, transmission fluid, antifreeze, freon, waste paint and lacquer thinner,
      batteries, solvents, lubricants, degreasing agents, gasoline, diesel fuels,
      asbestos containing materials and other chemicals.




Accordingly,
      we are subject to regulation by federal, state and local authorities
      establishing requirements for the use, management, handling and disposal of
      these materials and health and environmental quality standards. We are also
      subject to laws, ordinances and regulations governing investigation and
      remediation of contamination at facilities we operate to which we send hazardous
      or toxic substances or wastes for treatment, recycling or disposal.
      Noncompliance with or changes to these requirements could limit our ability
      to
      operate our business.




Our
      customers and potential customers are subject to federal, state and local
      statutes, ordinances and regulations regarding the ownership of recreational
      vehicles. The adoption of more stringent statutes, ordinances and regulations
      affecting the consumer ownership of recreational vehicles, could limit our
      ability to sell our products.





**Available
      Information**




The
      Company files annual reports, quarterly reports, current reports and other
      information with the Securities and Exchange Commission. Copies of such
      materials can be read, copied and obtained from the Public Reference Room of
      the
      Securities and Exchange Commission at 100 F Street, N.E., Room 1024, Washington,
      D.C. 20549. You may obtain information on the operation of the Public Reference
      Room by calling the Securities and Exchange Commission at 1-800-SEC-0330. You
      can access the Company’s filings electronically by visiting the Securities and
      Exchange Commission’s website at http://www.sec.gov. In addition, the Company
      will provide copies of such filings free of charge upon request. While any
      notes
      remain outstanding, we will make available, upon request, to any beneficial
      owner and any prospective purchaser of notes the information required pursuant
      to Rule 144A(d)(4) under the Securities Act during any period in which we are
      not subject to Section 13 or 15 (d) of the Exchange Act. Such requests
      may be made by calling our main number on the cover page of this report or
      by
      writing to the following address: Lazy Days’ R.V. Center, Inc. 6130 Lazy Days
      Boulevard, Seffner, Florida 33584-2968, Attn: Director of Corporate Reporting
      and Investor Relations.





14


**ITEM 1A.
      RISK FACTORS**





You
      should carefully consider the risk factors described below, as well as the
      other
      information included or incorporated by reference in this Annual Report on
      Form
      10-K prior to making a decision to invest in our securities. The risks and
      uncertainties described below are not the only ones facing our company.
      Additional risks and uncertainties not presently known or that we currently
      believe to be less significant may also adversely affect us.





Following
      is a summary of such risks which can be found in more detail in the “Risk
      Factors” described in our Registration Statement on Form S-4 dated August 12,
      2004, as amended.




***We
      may experience unanticipated fluctuations in our operating results for a variety
      of reasons.***




Our
      net
      sales, gross margin and operating results may fluctuate significantly from
      period to period due to a number of factors, many of which are not readily
      predictable. These factors include the following:




the
          margins associated with the mix of products we sell in any particular period;
        the
          ability of our suppliers to introduce new models that achieve consumer
          acceptance;
        the
          addition or loss of competing dealers;
        the
          timing of trade shows and rallies, which we use to market and sell our
          products; and
        factors
          affecting the recreational vehicle industry as a whole, including economic
          and
          seasonal factors.




Our
      overall gross margin may decline in future periods to the extent that we
      increase the percentage of sales of lower gross margin towable products or
      if
      the mix of motor homes we sell shifts to lower gross margin units. In addition,
      a relatively small variation in the number of recreational vehicles we sell
      in
      any quarter can have a significant impact on total sales and operating results
      for that quarter.




We
      attempt to forecast demand for our products and adjust our inventory accurately
      prior to receipt of such orders. However, it is highly unlikely that we will
      consistently accurately forecast the timing, rate and mix of orders. This aspect
      of our business makes our planning inexact and, in turn, affects our
      inventories, operating results and cash flow for any given quarter.




***Reduced
      availability of financing for our customers could adversely affect our sales
      volume.***




Our
      customers generally secure financing from third-party lenders. Reduced
      availability of such financing and higher interest rates may have an adverse
      effect on the recreational vehicle business and our sales. If third-party
      financing were to become unavailable or were to be restricted, this could have
      a
      material adverse effect on our results of operations. Availability of financing
      is dependent on the lending practices of lending institutions, financial
      markets, governmental policies and economic conditions, all of which are largely
      beyond our control. Many states classify recreational vehicles as personal
      property rather than real property for purposes of taxation and lien perfection
      and as a result, interest rates for recreational vehicles are generally higher
      and the terms of the loans shorter than for site-built homes. There can be
      no
      assurance that affordable wholesale or retail financing for recreational
      vehicles will continue to be available on a widespread basis.





***Our
      geographic concentration heightens our exposure to adverse regional
      developments, including adverse economic conditions, demographic changes, severe
      weather events and natural disasters*** .




For
      the
      year ended December 31, 2006, 64% of our unit sales were to customers in
      the state of Florida. Our geographic concentration in the southeast and Florida
      in particular, heightens our exposure to adverse developments related to
      competition, as well as economic and demographic changes in this region. We
      cannot assure you that our geographic concentration will not result in a
      material adverse effect on our business, financial condition or results of
      operations in the future. In addition, as a single-site operator, a severe
      weather event or natural catastrophe such as a hurricane may adversely affect
      our business. We have a single location near Tampa, Florida which is in close
      proximity to the Gulf of Mexico. A severe weather event such as a hurricane
      could cause severe damage to our property and inventory and could cause
      disruptions to our operations. Although we believe we have adequate insurance
      coverage, if we were to experience a catastrophic loss, we may exceed our policy
      limits and/or we may have difficulty obtaining similar insurance coverage in
      the
      future. We cannot assure you that an adverse weather event would not have an
      adverse impact on our business.




15


***Our
      business is cyclical and seasonal and this can lead to fluctuations in our
      sales
      and operating results.***




The
      industry in which we operate is highly cyclical and there can be substantial
      fluctuations in our retail sales and operating results, and the results for
      any
      prior period may not be indicative of results for any future period. Companies
      within the recreational vehicle industry are subject to volatility in operating
      results due to external factors such as economic, demographic and political
      changes.




Factors
      affecting the recreational vehicle industry include:




overall
          consumer confidence and the level of discretionary consumer spending, which
          had an adverse effect on our business in calendar years 2000 and 2001 and
          again in 2005 and 2006 may do so again depending on consumer reaction to
          economic uncertainty and potential volatility in the stock market;
        general
          economic conditions;
        increases
          in interest rates (which increase our borrowing costs and borrowing costs
          for
          our customers who finance their RV purchases);
        international
          tensions and hostilities;
        employment
          trends; and
        fuel
          availability and prices.


Changes
      in consumer confidence and the level of discretionary spending may
      disproportionately impact sales of our highest priced luxury motor homes and
      a
      significant decrease in demand for these motor homes may have an adverse effect
      on our business.




We
      cannot
      provide assurance that the factors that have had an adverse affect on our
      business in prior years will not have an adverse effect in the future.




We
      have
      experienced, and expect to continue to experience, significant variability
      in
      sales and net income as a result of seasonality in our business. Demand
      generally increases during the winter season, while sales and profits are
      generally lower during the spring and summer months.





***Changes
      in consumer preferences for our products or our failure to gauge those
      preferences could lead to reduced sales and additional costs.***




We
      believe that consumer preferences for recreational vehicles are likely to change
      over time. We further believe that the introduction of new features, designs
      and
      models will be critical to the future success of our operations. Delays in
      the
      introduction of new models or product features, or a lack of market acceptance
      of new features, designs or models, could have a material adverse effect on
      our
      business. Products may not be accepted for a number of reasons, including
      changes in consumer preferences or the failure of our suppliers to properly
      gauge consumer preferences. Our suppliers may also experience production
      difficulties, such as inefficiencies in purchasing and increased labor costs,
      as
      they introduce new models. We cannot be certain that new product introductions
      will not reduce revenues from existing models and adversely affect our results
      of operations. There can be no assurance that any of these new models or
      products will be introduced to the market on time or that they will be
      successful when introduced.





***We
      are dependent on continued relationships with major manufacturers who supply
      our
      products.***




Our
      success depends, to a significant extent, on continued relationships with nine
      major manufacturers from whom we purchase the majority of our new RV products.
      In the majority of cases we have entered into long term dealer agreements that
      provide exclusive sales rights for a certain product line over an extended
      geographic area. Some of these agreements require us to meet specified sales
      goals. Cancellation or modification of the dealer agreements, including the
      loss
      of our rights to geographic exclusivity, or a failure to renew a dealer
      agreement with one or more of these manufacturers could have a material adverse
      effect on our revenues by limiting our access to desirable products. We
      currently purchase over 150 models of new RVs from these nine manufacturers.
      We
      depend on our relationships with these manufacturers to provide the most
      desirable possible mix of new models to our customers. The loss of one of a
      significant number of models could reduce our competitiveness by decreasing
      our
      potential sales.





***If
      the frequency and size of product liability and other claims against us,
      including wrongful death, increase, our business, results of operations and
      financial condition may be harmed.***




The
      products that we sell and service have the potential to inflict significant
      injury or property damage. Even if the manufacturer caused a defect which led
      to
      injury or property damage, we could be liable on the theory of third-party
      product liability. We carry insurance for this in addition to the general
      liability insurance generally maintained by the manufacturers, but it is
      possible that a claim would not be covered or would exceed our policy limits.




***Fuel
      shortages, or higher prices for fuel, could have a negative effect on sales
      of
      recreational vehicles.***




Gasoline
      or diesel fuel is required for the operation of motor homes and most vehicles
      used to tow travel trailers. Particularly in view of increased international
      tensions, there can be no assurance that the supply of these petroleum products
      will continue uninterrupted, that rationing will not be imposed or that the
      price of or tax on these petroleum products will not significantly increase
      in
      the future. Increases in gasoline prices and speculation about potential fuel
      shortages have had an unfavorable effect on consumer demand for recreational
      vehicles from time to time in the past, which then had a material adverse effect
      on our sales volume, and may do so again in the future.




16


***We
      require floor plan financing to purchase our inventory. The absence of available
      floor plan financing could have a material adverse effect on our operations
      and
      hinder our ability to achieve our growth strategy.***




We
      depend, to a significant extent, on our ability to finance the purchase of
      inventory, which in the automotive and RV retail industries involves borrowing
      money in the form of floor plan financing. Floor plan financing is the method
      in
      which dealerships finance the purchase of new vehicles from a manufacturer.
      Our
      floor plan financing is secured by substantially all of our vehicle inventory
      and related accounts receivable. Any inability to obtain floor plan financing
      on
      customary terms, or the termination of our floor plan financing arrangements
      by
      our floor plan lenders, could have a material adverse effect on our operations.


***A
      substantial
      portion of our income is from financing, insurance and extended service
      contracts, which depend on third-party***


***lenders
      and insurance companies. We cannot assure you third-party lending institutions
      will continue to provide financing for***


***RV
      purchases.***




A
      substantial part of our earnings come from the fees we receive from lending
      institutions and insurance companies for arranging financing and insurance
      coverage for our customers. The lending institution pays us a fee for each
      loan
      that we arrange. If the lenders we arrange financing through were to lend to
      our
      customers directly rather than through us, we would not receive a fee. In
      addition, if customers prepay financing we arranged within a specified period
      (generally within six months of the making of the loan), we are required to
      rebate (or "chargeback") all or a portion of the commissions paid to us by
      the
      lending institution. Our revenues from financing fees and vehicle service
      contract fees are recorded net of a reserve for estimated future chargebacks
      based on historical operating results and the termination provisions of the
      applicable contracts. Lending institutions may change the criteria or terms
      they
      use to make loan decisions, which could reduce the number of customers for
      whom
      we can arrange financing, or may elect to not continue to provide these products
      with respect to RVs. Our customers may also use the internet or other electronic
      methods to find financing alternatives. If any of these events occur, we could
      lose a significant portion of our income and profit.




In
      addition, we generally offer our customers (1) a service contract that
      provides additional warranty coverage on their RV or some of its parts after
      the
      manufacturer's original warranty expires and (2) various types of insurance
      policies that will provide money to pay a customer's RV loan if the customer
      dies or is physically disabled. We sell these products as a broker for unrelated
      companies that specialize in these types of coverage and we receive a fee for
      each product that we sell. If our customers obtain these policies directly
      from
      the insurers, our income and profits could decline.





***The
      loss of key personnel and/or failure to attract and retain highly qualified
      personnel could make it more difficult for us to generate cash flow from
      operations and service our debt.***




We
      are
      dependent on the continued services of our senior management team. If any of
      these persons were to leave our company it could be difficult to replace him
      or
      her. We believe the loss of such key personnel could have a material adverse
      effect on us and our financial performance. We cannot assure you that we can
      attract and retain sufficient qualified personnel to meet our business
      needs. See “Directors and Executive Officers of the
      Registrant”.





***The
      interests of our controlling stockholder may be in conflict with your interests
      as a holder of Notes.***




RV
      Acquisition owns 100% of Holdings common stock, which in turn owns 100% of
      our
      common stock. BRS LP owns approximately 84% of RV Acquisition's Common Stock
      and
      has the ability to elect a majority of the board of directors and generally
      to
      control the affairs and policies of our company. Circumstances may occur in
      which the interests of BRS LP, as our stockholder, in pursuing acquisitions
      or
      otherwise, could be in conflict with the interests of the holders of the Notes.
      See “Security Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters".




***We
      are subject to extensive government regulation. Changes in these regulations
      could have a negative effect on our financial condition.***




The
      adoption of more stringent statutes and regulations, changes in the
      interpretation of existing statutes and regulations or our entrance into
      jurisdictions with more stringent regulatory requirements could curtail some
      of
      our operations. Such events could also deny us the opportunity to operate in
      certain locations or restrict products or services offered by us, including
      restrictions on the terms of financial and insurance products that we offer.




Various
      federal, state and local regulatory agencies, including the Occupational Safety
      and Health Administration, the United States Environmental Protection Agency
      and
      similar federal and local agencies, have jurisdiction over the operation of
      our
      dealerships, repair facilities and other operations with respect to matters
      such
      as consumer protection, workers' safety and laws regarding protection of the
      environment, including air, water and soil. The failure to maintain all
      requisite licenses and permits and comply with all applicable federal, state
      and
      local regulations, requisite licenses and permits could limit our ability to
      operate our business.




17


As
      with
      vehicle dealerships generally, and parts and service operations in particular,
      our business involves the use, handling, storage and contracting for recycling
      or disposal of hazardous or toxic substances or wastes, including
      environmentally sensitive materials such as motor oil, waste motor oil and
      filters, transmission fluid, antifreeze, freon, waste paint and lacquer thinner,
      batteries, solvents, lubricants, degreasing agents, gasoline, diesel fuels,
      asbestos containing materials and other chemicals.




Accordingly,
      we are subject to regulation by federal, state and local authorities
      establishing requirements for the use, management, handling and disposal of
      these materials and health and environmental quality standards. We are also
      subject to laws, ordinances and regulations governing investigation and
      remediation of contamination at facilities we operate to which we send hazardous
      or toxic substances or wastes for treatment, recycling or disposal.
      Noncompliance with or changes to these requirements could limit our ability
      to
      operate our business.




Our
      customers and potential customers are subject to federal, state and local
      statutes, ordinances and regulations, including motor vehicle licensing
      requirements, regarding the ownership of recreational vehicles. The adoption
      of
      more stringent statutes, ordinances and regulations affecting the consumer
      ownership of recreational vehicles could limit our ability to sell our products.




***The
      occurrence of extraordinary events, such as a major terrorist attack in the
      United States, may adversely affect our business, resulting in a decrease in
      our
      revenues.***




Future
      terrorist attacks cannot be predicted, and their occurrence can be expected
      to
      further negatively affect the United States economy generally, and specifically
      the regional markets in which we operate.




**ITEM 1B.
      UNRESOLVED
      STAFF
      COMMENTS**





None.





**ITEM 2.
      PROPERTIES**




*Leased
      Properties*




We
      lease
      our 126-acre facility, located at 6130 Lazy Days Boulevard, Seffner, Florida,
      from I-4 Land Holding Limited Company (“I-4”), an entity controlled by Don
      Wallace, our founder and former Chairman of the Board, under a lease arrangement
      the initial term of which will expire in 2022. The amended lease entered into
      on
      May 14, 2004 included four (4) five-year renewal options, which if
      exercised would extend the expiration date to 2042.





On
      October 12, 2006, we amended this lease agreement with I-4.  The lease was
      amended to modify the purchase option from $42 million (subject to CPI
      increases) through May 14, 2011 to a fair market value purchase option, as
      defined, through January 15, 2023.  The amendment also permitted I-4
      to purchase certain of our buildings located on land leased from I-4 as
      part of an asset purchase agreement, as well as reduce rents owed to I-4 by
      an aggregate amount of $2.7 million during 2006, 2007 and 2008. The amended
      lease agreement also gives us a right to purchase certain adjacent land
      currently rented by a third party.  Finally, the amended lease agreement
      and asset purchase agreement provided us with $11.6 million of cash, preserved
      our business use of all the leased real property and significantly reduced
      our
      future lease obligation without increasing the existing lease term.  The
      $11.6 million of cash proceeds and the $2.7 million of rent abatements were
      treated similar to lease incentives under SFAS No. 13, “Accounting for Leases”
and are being amortized over the remaining life of the lease, and are presented
      as deferred rent on the balance sheet.





The
      annual rent before abatements is $4,793,880 and will further increase thereafter
      based on periodic CPI adjustments. The lease provides for equal monthly rental
      payments and provides that the lessee pays all property taxes and insurance.
      Rent expense is calculated on a straight-line basis over the life of the lease
      resulting in deferred rent during the earlier years of the lease. We are also
      responsible for maintenance costs as well as betterments to the facilities.




We
      also
      have two short-term leases on properties that we use for off-site RV parking
      lots during our peak-season.




**ITEM 3.
      LEGAL PROCEEDINGS**




We
      are
      party to numerous legal proceedings that arise in the ordinary course of our
      business. We do not believe that the ultimate resolution of these matters will
      have a material adverse effect on our business, results of operations, financial
      condition or cash flows. However, the results of these matters cannot be
      predicted with certainty and an unfavorable resolution of one or more of these
      matters could have a material adverse effect on our business, results of
      operations, financial condition and/or cash flows.




**ITEM 4.
      SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY
      HOLDERS**




None.







18


**PART
      II**




**ITEM 5.
      MARKET
      FOR REGISTRANT’S COMMON EQUITY,
      RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
      SECURITIES**




There
      is
      no market for our common stock. As of December 31, 2006, Holdings owns 100%
      of our common stock. RV Acquisition owns 100% of Holdings Class A common stock.
      At December 31, 2006, Bruckmann, Rosser, Sherrill & Co. II, L.P. held
      84.1% of RV Acquisition common stock, the balance was held by Don Wallace
      (10.6%), management and others. See “Security Ownership and Certain Beneficial
      Owners” in Item 12 of this report.




**ITEM 6.
      SELECTED FINANCIAL
      DATA**




The
      following table presents selected historical statement of operations data and
      balance sheet data as of and for the periods presented. The statement of
      operations data set forth below with respect to fiscal years 2006, 2005 and
      2004, and the balance sheet data at December 31, 2006 and December 31,
      2005, are derived from, and should be read in conjunction with, the audited
      financial statements and related notes thereto, which are included elsewhere
      in
      this Form 10-K. The statement of operations data set forth below with respect
      to
      fiscal years 2003 and 2002, and the balance sheet data at December 31,
      2004, December 31, 2003 and December 31, 2002, are derived from
      audited financial statements of the Company which are not included in this
      Form
      10-K.





**Years
      Ended December 31** ($
      in
      thousands)


**2006**
            
            **2005**
            
            **2004**
            
            **2003**
            
            **2002****Statement
                of Operations Data:**Revenues:New
                vehicles
            
            
            
            
            $
            445,576
            
            $
            475,712
            
            $
            477,166
            
            $
            416,165
            
            $
            384,041Pre-owned
                vehicles
            
            
            
            
            
            248,615
            
            
            263,742
            
            
            260,018
            
            
            278,592
            
            
            245,485Other
            
            
            
            
            
            63,077
            
            
            64,744
            
            
            62,526
            
            
            60,882
            
            
            51,601Total
                revenues
            
            
            
            
            
            757,268
            
            
            804,198
            
            
            799,710
            
            
            755,639
            
            
            681,127Cost
                of revenues
            
            
            
            
            
            643,371
            
            
            684,307
            
            
            683,415
            
            
            646,685
            
            
            582,159Gross
                profit
            
            
            
            
            
            113,897
            
            
            119,891
            
            
            116,295
            
            
            108,954
            
            
            98,968Selling,
                general and administrative expenses
            
            
            
            
            
            81,710
            
            
            83,314
            
            
            80,393
            
            
            70,027
            
            
            67,591Depreciation
                and amortization
            
            
            
            
            
            7,847
            
            
            8,302
            
            
            9,988
            
            
            3,238
            
            
            3,942Loss
                on extinguishment of debt
            
            
            
            
            
            102
            
            
            348
            
            
            3⁄4
            
            
            3⁄4
            
            
            6,198Operating
                income
            
            
            
            
            
            24,238
            
            
            27,927
            
            
            25,914
            
            
            35,689
            
            
            21,237Floor
                plan interest expense
            
            
            
            
            
            4,170
            
            
            3,565
            
            
            2,441
            
            
            2,556
            
            
            2,970Other
                interest expense
            
            
            
            
            
            17,157
            
            
            17,813
            
            
            12,290
            
            
            3,211
            
            
            16,267Income
                taxes
            
            
            
            
            
            1,110
            
            
            2,487
            
            
            3,354
            
            
            4,542
            
            
            4,493Net
                income (loss)
            
            
            
            
            $
            1,801
            
            $
            4,062
            
            $
            7,829
            
            $
            25,370
            
            $
            (2,493
            )**Balance
                Sheet Data (at period end):**Inventories
            
            
            
            
            $
            100,688
            
            $
            87,392
            
            $
            85,961
            
            $
            69,873
            
            $
            74,087Working
                capital
            
            
            
            
            
            36,421
            
            
            23,353
            
            
            24,060
            
            
            9,011
            
            
            2,907Total
                assets
            
            
            
            
            
            344,772
            
            
            344,022
            
            
            346,484
            
            
            131,512
            
            
            123,527Floor
                plan notes payable
            
            
            
            
            
            67,275
            
            
            74,609
            
            
            69,576
            
            
            52,046
            
            
            56,185Total
                debt (excluding floor plan and
              including
                current maturities)
            
            
            
            
            
            140,797
            
            
            143,938
            
            
            150,227
            
            
            59,046
            
            
            75,161Total
                stockholder’s equity (deficiency)
            
            
            
            
            
            73,665
            
            
            71,497
            
            
            67,435
            
            
            (103,565
            )
            
            (124,400
            )





19


**ITEM 7.
      MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF
      FINANCIAL CONDITION AND RESULTS OF OPERATIONS**




The
      following discussion regarding Lazy Days’ R.V. Center, Inc.’s financial
      condition and results of operations should be read in conjunction with our
      financial statements and the notes to those statements and other financial
      information appearing elsewhere in this report. Unless stated otherwise, the
      information provided in this section relates to Lazy Days’ R.V.
      Center, Inc. only and not to its parent, Holdings. This report contains
      forward-looking statements that involve risks and uncertainties. Our actual
      results may differ materially from those indicated in forward-looking
      statements.




**Overview**




We
      are
      the world’s largest single-site dealer of recreational vehicles (“RVs”) with the
      industry’s broadest selection of new and previously-owned RVs. We are a primary
      point of distribution for nine of the leading manufacturers in the recreational
      vehicle retail industry, an industry with sales of approximately
      $12 billion in new, and $14 billion in pre-owned RV vehicles annually.
      Located on a 126-acre site outside of Tampa, Florida, we are widely recognized
      in the RV community as the premier destination for RV enthusiasts, attracting
      over 250,000 visitors each year to our RV dealership, and approximately
      1.3 million visitors per year to our facility (including visitors to
      additional attractions that appeal to RV owners located adjacent to our site,
      namely Camping World, Cracker Barrel and Flying J Travel Plaza).




We
      offer
      our customers an extensive selection of RVs and a variety of services, such
      as
      financing, insurance and a 230-bay, fully-staffed service and repair department.
      Our inventory is displayed in a park-like setting and our facility also includes
      a full-service RV park, two swimming pools, tennis courts and meeting and dining
      facilities.




We
      derive
      our revenues principally from sales and rental of new units, sales of pre-owned
      units, commissions earned on sales of third-party financing and insurance
      products, service and rental repairs, and visitors fees at Rally Park. In 2006,
      we derived our revenues from these categories in the following percentages,
      58.8%, 32.8%, 2.8%, 5.1% and 0.5%, respectively. New and pre-owned unit sales
      accounted for more than 91% of total revenues.




The
      vast
      majority of our costs of revenues are related to inventory purchases. New and
      pre-owned vehicles have accounted for 97% or more of cost of revenues in each
      of
      the previous three years. Increased unit costs are immediately passed through
      to
      end customers. As a result, our gross profit margin has been 15.0%, 14.9% and
      14.5% for the years ended December 31, 2006, 2005 and 2004, respectively.




Our
      gross
      profit margins on pre-owned vehicles are typically higher on a percentage basis
      while our gross profit margins on an absolute dollar basis are typically higher
      on new vehicles. In 2006, gross profit margins on new vehicles averaged 9.1%
      compared to 10.7% for pre-owned vehicles, and our gross profit from sales of
      new
      vehicles was $40.5 million and $26.6 million for pre-owned vehicles. Although
      gross profit margins on new and pre-owned vehicles were down slightly from
      2005,
      overall margins slightly increased due to improved margins relative to parts,
      service and other.




Salaries,
      commissions and benefits represent the largest component of our total selling,
      general and administrative expense and comprised more than 50% of total selling,
      general and administrative expense. In 2006, approximately 13.3% of our selling,
      general and administrative expense consisted of commissions for our sales force
      which are directly correlated to RV vehicle sales levels. Selling, general
      and
      administrative expense is typically consistent with revenue on a percentage
      basis.





20


**Results
      of Operations**




The
      following table sets forth the percentages of revenues that certain items of
      operating data constitute for the periods indicated:




**Fiscal
                Year Ended December 31****2006**
            
            **2005**
            
            **2004****Statement
                of operations data:**Revenues
            
            
            100.0
            %
            
            100.0
            %
            
            100.0
            %Cost
                of revenues
            
            
            85.0
            
            
            85.1
            
            
            85.5Gross
                profit
            
            
            15.0
            
            
            14.9
            
            
            14.5Selling,
                general and administrative expenses
            
            
            11.8
            
            
            11.4
            
            
            11.3Income
                from operations
            
            
            3.2
            
            
            3.5
            
            
            3.2Interest
                expense
            
            
            2.8
            
            
            2.7
            
            
            1.8Income
                before income taxes
            
            
            0.4
            
            
            0.8
            
            
            1.4Income
                tax expense
            
            
            0.2
            
            
            0.3
            
            
            0.4Net
                income
            
            
            0.2
            
            
            0.5
            
            
            1.0





**SUMMARIZED
      QUARTERLY FINANCIAL DATA (Unaudited)**





The
      following is a summary of unaudited quarterly financial information for the
      years ended December 31, 2006 and 2005.





First
            
            Second
            
            Third
            
            Fourth2006Net
                sales
            
            $
            237,763,619
            
            $
            192,835,132
            
            $
            156,157,934
            
            $
            170,511,795Gross
                profit
            
            
            36,788,102
            
            
            29,116,063
            
            
            22,069,696
            
            
            25,923,219Net
                income (loss)
            
            
            3,998,865
            
            
            1,421,983
            
            
            (2,755,219
            )
            
            (864,921
            )2005Net
                sales
            
            $
            245,094,910
            
            $
            204,799,631
            
            $
            168,925,447
            
            $
            185,378,243Gross
                profit
            
            
            37,759,484
            
            
            30,554,416
            
            
            24,596,113
            
            
            26,981,306Net
                income (loss)
            
            
            5,003,410
            
            
            752,912
            
            
            (1,536,447
            )
            
            (157,636
            )





21


***Results
      for the three months ended December 31, 2006 compared to the results for
      the three months ended December 31, 2005***




*Revenues* .
      Revenues decreased from $185.4 million in the three months ended
      December 31, 2005 to $170.5 million in the comparable period in 2006. This
      was due to a
      decrease of
      approximately $14.3 million of new vehicle sales, $0.6 million in pre-owned
      vehicle sales and $0.7 million in rental income.





*New
      Unit Sales* .
      Sales
      and rental of new vehicles was $97.9 million in the three months ended
      December 31, 2006 compared to $112.2 million for the comparable period in
      2005. New vehicle unit sales decreased from 1,346 for the fourth quarter of
      2005
      to 732 in 2006. A significant decrease in towable product sales, driven by
      bulk
      travel trailer sales in 2005, was offset by a 2.5% improvement in motorized
      units. Bulk travel trailer sales represent the sale of travel trailers to the
      Federal Emergency Management Agency (“FEMA”) as a part of the U.S. Government’s
      hurricane relief efforts.





**Three
                Months Ended****December
                31, 2006**
            
            **December
                31, 2005**Class
                A - Diesel
            
            
            302
            
            
            314Class
                A - Gas
            
            
            139
            
            
            130Class
                C
            
            
            89
            
            
            73Total
                Motorized
            
            
            530
            
            
            517Fifth
                Wheel
            
            
            123
            
            
            151Travel
                Trailer
            
            
            79
            
            
            109Bulk
                Travel Trailers
            
            
            3⁄4
            
            
            569Total
                Towable
            
            
            202
            
            
            829Total
                New Units
            
            
            732
            
            
            1,346




*Pre-Owned
      Unit Sales* .
      Sales
      of pre-owned vehicles for the fourth quarter of 2006 were $57.3 million compared
      to $57.9 million for the comparable period in 2005. Used vehicle unit sales
      decreased from 800 for the fourth quarter of 2005 to 713 in 2006, due to lower
      demand in the fourth quarter of motorized products and decreased travel trailer
      sales driven by the resale of trailers from our rental program in
      2005.




**Three
                  Months Ended****December
                  31, 2006**
              
              **December
                  31, 2005**Class
                  A - Diesel
              
              
              245
              
              
              264Class
                  A - Gas
              
              
              168
              
              
              203Class
                  C
              
              
              84
              
              
              88Total
                  Motorized
              
              
              497
              
              
              555Fifth
                  Wheel
              
              
              79
              
              
              77Travel
                  Trailer
              
              
              71
              
              
              102Other
              
              
              66
              
              
              66Total
                  Towable
              
              
              216
              
              
              245Total
                  Pre-Owned Units
              
              
              713
              
              
              800




22


*Finance
      and Insurance Related Revenues* .
      Consistent with decreases in overall unit sales, finance, insurance and extended
      warranty related revenues decreased slightly by $0.2 million from $5.2 million
      in the three months ended December 31, 2005 to $5.0 in the fourth quarter of
      2006. The decrease is attributable to lower volume partially offset by improved
      penetration in percentage of units financed.




*Parts,
      Service and Other Revenues* .
      Parts,
      service and other revenues for the fourth quarter of 2006 were $9.8 million,
      $0.4 million more than the fourth quarter of 2005. The increase is attributable
      to overall increased maintenance and repair services.




*Gross
      Profit* .
      Gross
      profit consists of gross revenues less our cost of sales and services. Gross
      profit in the three months ended December 31, 2006 was $25.9 million
      compared with the three months ended December 31, 2005 at $27.0 million.
      However, gross profit margin increased from 14.6% in the three months ended
      December 31, 2005 to 15.2% in the comparable period in 2006.




*Selling,
      General and Administrative Expenses* .
      Selling, general and administrative expenses, including depreciation and
      amortization was slightly higher at $22.0 million, or 12.9% of revenues, in
      the
      three months ended December 31, 2006 compared to $21.9 million, or 11.8% of
      revenues, in the comparable period in 2005. Historically, salary, commissions
      and benefits have comprised the majority of our total selling, general and
      administrative expenses and exceeded 50% of selling, general and administrative
      expenses in the three months ended December 31, 2006.




*Operating
      Profit* .
      Operating profit represents our gross profit less selling, general and
      administrative expenses, including depreciation and amortization. Operating
      profit decreased from $5.1 million in the three months ended December 31,
      2005 to $3.9 million in the comparable period in 2006, or 23.5%. This decrease
      was due to decreased total revenues.




*Interest
      Expense—Floor Plan Credit Facility and Senior Notes* .
      Interest expense decreased from $5.5 million in the three months ended
      December 31, 2005 to $5.3 million in the comparable period in 2006.




*Income
      Tax Benefit* .
      Income
      tax benefit increased from $0.2 million in the three months ended
      December 31, 2005 to an income tax benefit of $0.6 million in the
      comparable period in 2006. This increase was primarily attributable to increased
      pre-tax loss of $1.4 million we experienced during the three-month period ended
      December 31, 2006 compared to pre-tax loss of $0.3 million during the
      fourth quarter of 2005.





***Results
      for 2006 Compared to the Results for 2005***





*Revenues* .
      Revenues decreased from $804.2 million in 2005 to $757.3 million in 2006. This
      decrease resulted primarily from decreases in new and pre-owned unit sales.




23


*New
      Unit Sales* .
      Sales
      and rental of new vehicles for the year ended December 31, 2006 were $445.6
      million compared to $475.7 million for the year ended December 31, 2005.
      New vehicle unit sales, excluding wholesale, decreased 1,036 units to 3,303
      in
      2006. This decrease in new unit sales primarily reflected a decrease in towable
      products (864 units), specifically travel trailers, and a decrease of motorized
      products (172 units). The decrease in travel trailers was due to the bulk travel
      trailer sales in 2005. Bulk travel trailer sales represent the sale of travel
      trailers to FEMA as a part of the U.S. Government’s hurricane relief
      efforts.





**Fiscal
                Year Ended****December
                31, 2006**
            
            **December
                31, 2005**Class
                A - Diesel
            
            
            1,334
            
            
            1,418Class
                A - Gas
            
            
            563
            
            
            697Class
                C
            
            
            365
            
            
            319Total
                Motorized
            
            
            2,262
            
            
            2,434Fifth
                Wheel
            
            
            586
            
            
            646Travel
                Trailer
            
            
            455
            
            
            443Bulk
                Travel Trailers
            
            
            3⁄4
            
            
            816Total
                Towable
            
            
            1,041
            
            
            1,905Total
                New Units
            
            
            3,303
            
            
            4,339




*Pre-Owned
      Unit Sales* .
      Pre-owned unit sales in 2006 were $248.6 million compared to $263.7 million
      in
      2005. Pre-owned unit sales, excluding wholesale, decreased from 4,211 in 2005
      to
      3,572 in 2006. Overall pre-owned unit sales experienced a decrease due to lower
      demand for motorized products and decreased travel trailer sales driven by
      the
      resale of travel trailers from our rental program in 2005.





**Fiscal
                Year Ended****December
                31, 2006**
            
            **December
                31, 2005**Class
                A - Diesel
            
            
            1,136
            
            
            1,181Class
                A - Gas
            
            
            870
            
            
            1,029Class
                C
            
            
            345
            
            
            399Total
                Motorized
            
            
            2,351
            
            
            2,609Fifth
                Wheel
            
            
            387
            
            
            399Travel
                Trailer
            
            
            377
            
            
            891Other
            
            
            457
            
            
            312Total
                Towable
            
            
            1,221
            
            
            1,602Total
                Pre-Owned Units
            
            
            3,572
            
            
            4,211




*Finance
      and Insurance Related Revenues* .
      Finance, insurance and extended warranty related revenues decreased
      approximately 0.9% ($0.2 million) from $21.4 million in 2005 to $21.2 million
      in
      2006. Overall, insurance product revenues and finance commissions remained
      relatively flat. The decrease is attributable to lower unit sales, mostly offset
      by improvements (1.7%) in the percentage of units financed as well as a higher
      revenue per unit financed. Additionally, the bulk travel trailer sales were
      not
      eligible for financing.




*Parts,
      Service and Other Revenues* .
      Parts
      and service revenues were $38.8 million in 2006, a decrease of $2.1 million
      from
      2005. This decline resulted from a decrease in retail and warranty sales and
      the
      decreased unit sales experienced in 2006.




*Gross
      Profit* .
      Gross
      profit consists of gross revenues less our cost of sales and services. Gross
      profit decreased from $119.9 million in 2005 to $113.9 million in 2006, or
      5.0%.
      This decrease was largely attributable to decreased new and pre-owned unit
      volumes. Gross profit margin increased slightly to 15.0% in 2006 up from 14.9%
      in the prior year.




*Selling,
      General and Administrative Expenses* .
      Selling, general and administrative expenses, including depreciation and
      amortization, decreased from $92.0 million, or 11.4% of revenues, in 2005 to
      $89.7 million, or 11.8% of revenues, in 2006. This decrease corresponded to
      decreases in salary, commissions and benefits expenses, which decreased
      primarily due to decreased gross profit.




24


*Operating
      Profit* .
      Operating profit represents our gross profit, less selling, general and
      administrative expenses and depreciation and amortization. Operating profit
      decreased from $27.9 million in 2005 to $24.2 million in 2006. This decrease
      was
      largely due to lower sales and gross profit as discussed above.




*Interest
      Expense—Floor Plan Credit Facility and Senior Notes* .
      Interest expense remained relatively flat in 2006 as compared to
      2005.




*Income
      Tax Expense* .
      Income
      tax expense decreased from $2.5 million in 2005 to $1.1 million in 2006. This
      decrease was primarily attributable to a decline in pre-tax income from $6.5
      million in 2005 to $2.9 million in 2006.




***Results
      for 2005 Compared to the Results for 2004***




*Revenues* .
      Revenues increased from $799.7 million in 2004 to $804.2 million in 2005. This
      increase resulted primarily from increases in pre-owned unit sales and parts
      and
      service revenues.





*New
      Unit Sales* .
      Sales
      and rental of new vehicles for the year ended December 31, 2005 were $475.7
      million compared to $477.2 million for the year ended December 31, 2004.
      New vehicle unit sales, excluding wholesale, increased 176 units to 4,339 in
      2005. This increase in new unit sales primarily reflected an increase in towable
      products (422 units), specifically travel trailers, and a decrease of motorized
      products (246 units). The increase in travel trailers was due to the bulk travel
      trailer sales.




*Pre-Owned
      Unit Sales* .
      Pre-owned unit sales in 2005 were $263.7 million compared to $260.0 million
      in
      2004. Pre-owned unit sales, excluding wholesale, increased from 3,745 in 2004
      to
      4,211 in 2005. Overall pre-owned unit sales experienced an increase driven
      by
      the resale of travel trailers from our rental program in 2005.




*Finance
      and Insurance Related Revenues* .
      Finance, insurance and extended warranty related revenues decreased
      approximately 4.0% ($0.9 million) from $22.3 million in 2004 to $21.4 million
      in
      2005. Overall, insurance product revenues and finance commissions remained
      relatively flat. As a result of the relative increase in towable units as a
      proportion of new unit sales, we experienced a corresponding decrease in
      opportunities for earning financing revenues. Towable product customers finance
      less frequently than motorized customers and average less revenue when they
      do
      finance. Additionally, the bulk travel trailer sales were not eligible for
      financing.




*Parts,
      Service and Other Revenues* .
      Parts
      and service revenues were $40.9 million in 2005, an increase of $2.4 million
      from 2004. This represents an increase in retail and warranty sales and sales
      in
      2005, related to the increased unit sales experienced in 2005 and reflects
      higher labor rates charged to service customers in 2005 as compared to 2004.





*Gross
      Profit* .
      Gross
      profit consists of gross revenues less our cost of sales and services. Gross
      profit increased from $116.3 million in 2004 to $119.9 million in 2005, or
      3.1%.
      This increase was largely attributable to increased new and pre-owned unit
      volumes. Gross profit margin increased from 14.5% in 2004 to 14.9% in 2005.




*Selling,
      General and Administrative Expenses* .
      Selling, general and administrative expenses, including depreciation and
      amortization, increased from $90.4 million, or 11.3% of revenues, in 2004 to
      $92.0 million, or 11.4% of revenues, in 2005. This increase corresponded to
      increases in salary, commissions and benefits expenses, which increased
      primarily due to increased gross profit.




*Operating
      Profit* .
      Operating profit represents our gross profit, less selling, general and
      administrative expenses and depreciation and amortization. Operating profit
      increased from $25.9 million in 2004 to $27.9 million in 2005. This increase
      was
      largely due to higher sales and gross profit as discussed above.




*Income
      Tax Expense* .
      Income
      tax expense decreased from $3.4 million in 2004 to $2.5 million in 2005. This
      decrease was primarily attributable to pre-tax income of $6.5 million in 2005
      compared to pre-tax income of $11.2 million in 2004. Income tax expense in
      2004
      was also favorably impacted by the reversal of a $1.0 million tax reserve.





25


**Liquidity
      and Capital Resources**




*Liquidity.* ** Historically,
      we have satisfied our liquidity needs through cash from operations and various
      borrowing arrangements. Principal liquidity needs have included the acquisition
      of inventory, salary and sales commissions, debt service requirements and other
      capital expenditures necessary to maintain our facility. Our cash requirements
      consist principally of scheduled payments of principal and interest on
      outstanding indebtedness (including indebtedness under our amended floor plan
      credit facility), capital expenditures, salary and sales commissions and lease
      expenses. Based upon our current level of operations, we believe that our cash
      flow from operations, available cash and available borrowing under our senior
      secured revolving credit facility will be adequate to meet our future liquidity
      needs for the next several years.





*Operating
      Activities.* Net
      cash
      provided by operating activities for 2006 was equal to $1.5 million, compared
      with net cash provided by operating activities of $6.2 million in 2005. This
      decrease in net cash provided by operating activities for 2006 was primarily
      the
      result of a reduction in net income and an increase in inventories on hand.





*Investing
      Activities.* Net cash
      used in investing activities for 2006 was $3.0 million, compared with net
      cash used in investing activities of $4.6 million in 2005. The decrease in
      net cash used in investing activities during 2006 versus 2005 was primarily
      a
      reduction in capital expenditures.




*Financing
      Activities.* Net
      cash
      used in financing activities during 2006 was $23,000, compared to net cash
      used
      in financing activities of $1.9 million during 2005. The decrease primarily
      resulted from the renegotiation of the Company’s real estate lease and a
      reduction of the 2006 free cash flow offer compared to 2005.




*Working
      Capital.* Working
      capital, including cash and cash equivalents, totaled approximately
      $36.4 million at December 31, 2006. We maintain sizable inventory in
      order to meet the expectations of our customers, and believe that we will
      continue to require working capital consistent with past experience.
      Historically, we have funded our operations with internally generated cash
      flow
      and borrowings. Changes in our working capital are driven primarily by our
      profit levels. Borrowings under our amended floor plan credit facility to
      finance our new vehicle inventory may not exceed (i) 100% of the factory
      invoices for the related vehicles, (ii) 85% of the wholesale value of all
      pre-owned inventory (as determined in accordance with National Automobile
      Dealers Association RV Industry Appraisal Guide, or appraised NADA value) for
      vehicles in the current through 7th prior model years and (iii) 65% of the
      appraised NADA value with respect to pre-owned vehicles in the 8th, 9th and
      10th
      prior model years. At times, we have made repayments on our existing floor
      plan
      credit facility using excess cash flow from operations.




Our
      principal sources of funds are cash flows from operating activities and
      available borrowings under our senior secured revolving credit facility and
      amended floor plan credit facility. We believe that these funds will provide
      us
      with sufficient liquidity and capital resources for us to meet our current
      and
      future financial obligations, including our scheduled principal and interest
      payments, as well as to provide funds for working capital, capital expenditures
      and other needs for at least the next twelve months. No assurance can be given,
      however, that this will be the case.





*Capital
      Expenditures.* Our
      capital expenditures include expenditures to extend the useful life of our
      current facilities and expand operations. Historically, our annual maintenance
      capital expenditures have been lower than our annual depreciation charge. In
      2006, we invested approximately $3.0 million in capital expenditures
      primarily to improve our facility, upgrade our information system and other
      maintenance capital expenditures. Our senior secured revolving credit facility
      and amended floor plan credit facility limit our ability to make capital
      expenditures in excess of $5.0 million per annum. Based on current
      estimates, management believes that the amount of capital expenditures permitted
      to be made under our senior secured revolving credit facility and amended floor
      plan credit facility will be adequate to grow our business according to our
      business strategy and to maintain the properties and business of our continuing
      operations.




*Debt
      Service.* As of
      December 31, 2006, we had (i) $67.3 million of borrowings
      outstanding under our $85.0 million amended floor plan credit facility,
      subject to customary conditions and (ii) after giving effect to a $2.8 million
      letter of credit, which was amended effective February 2007, no availability
      under our $15 million senior secured revolvoing credit facility, which was
      amended effective September 22, 2006 to provide that no additional borrowings
      be
      made. The revolving credit facility was terminated February 22, 2007 and the
      Company has replaced this facility with an expansion of its Floor Plan facility
      from $85 million to $100 million which became effective on the same date. The
      Company also added a $15 million revolving line of credit.




Borrowings
      under our senior secured revolving credit facility will generally bear interest
      based on a margin over, at our option, the base rate or the reserve-adjusted
      LIBOR. Our senior secured revolving credit facility is secured by first priority
      interests in, and mortgages on, substantially all of our tangible and intangible
      assets and first priority pledges of all the equity interests owned by us in
      any
      future domestic subsidiaries, other than a second priority lien on those assets
      which are pledged under our amended floor plan credit facility.


26


**Off-Balance
      Sheet Arrangements**




The
      Company purchases and sells new vehicles under various consignment arrangements,
      including one with a related party. During the term of this agreement, which
      commenced on December 29, 2001, the Company has purchased virtually all
      inventories that have been held under consignment. The total consigned
      inventory, which is not included in the Company’s balance sheets, approximated
      $14.5 million and $17.4 million at December 31, 2006 and 2005,
      respectively. Total inventory purchased by the Company under this consignment
      arrangement totaled approximately $107 million and $143 million for the years
      ended December 31, 2006 and 2005, respectively.




Except
      as
      set forth above, at December 31, 2006, we had no off-balance sheet
      arrangements that have or are likely to have a material current or future effect
      on our financial condition, changes in financial condition, revenues or
      expenses, results of operations, liquidity, capital expenditures or capital
      resources.




**Contractual
      and Commercial Commitments Summary**




The
      following table sets forth our contractual and commercial commitments as of
      December 31, 2006:







Payments Due By Period**Contractual
                    Obligations**
                
                **Total**
                
                **Less
                    than 1 year**
                
                **1-3
                    years**
                
                **4-5
                    years**
                
                **After
                    5 years**Revolving
                    line of credit
                
                $
                —
                
                $
                —
                
                $
                —
                
                $
                —
                
                $
                —Senior
                    Notes (1)
                
                
                140,796,654
                
                
                —
                
                
                —
                
                
                —
                
                
                140,796,654Floor
                    plan notes payable
                
                
                67,275,431
                
                
                67,275,431
                
                
                —
                
                
                —
                
                
                —Operating
                    lease obligations
                
                
                75,874,787
                
                
                4,364,705
                
                
                9,164,838
                
                
                9,612,564
                
                
                52,732,680Total
                    contractual cash obligations
                
                $
                283,946,872
                
                $
                71,640,136
                
                $
                9,164,838
                
                $
                9,612,564
                
                $
                193,529,334





(1)
            Amount
                is net of $1,207,346 of unamortized discount and does not reflect
                any
                potential redemptions by note
                holders


associated
      with any free cash flow offer made by the Company as described in Note 9 to
      the
      financial statements.




27


**Critical
      Accounting Policies**




*General.* This
      discussion and analysis of our financial condition and results of operations
      is
      based upon our financial statements included in this Form 10-K, which have
      been
      prepared in accordance with accounting principles generally accepted in the
      United States. The preparation of these financial statements requires us to
      make
      estimates and judgments that affect the reported amounts of assets, liabilities,
      revenues, expenses and related disclosure of contingent liabilities. We base
      our
      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 value of assets and liabilities
      that are not readily apparent from other sources. Actual results may differ
      from
      these estimates under different assumptions or conditions.




We
      believe the following critical accounting policies affect our more significant
      judgments and estimates used in the preparation of the financial statements.
      A
      critical accounting policy is one which is both important to the portrayal
      of
      the company’s financial condition and results, and requires management’s most
      difficult, subjective or complex judgments, often as a result of the need to
      make estimates about the effect of matters that are inherently uncertain.





*Revenue
      Recognition.* Revenue
      from the sale of vehicles is recognized on delivery, transfer of title and
      completion of financing arrangements. Revenue from parts sales and service
      is
      recognized on delivery of service or product. We receive a commission from
      the
      sale of insurance and vehicle service contracts to customers. In addition,
      we
      arrange financing for customers through various financial institutions and
      receive commissions. We may be charged back (“chargebacks”) a portion of the
      financing fees or vehicle service contract fees in the event of early
      termination of the contracts by customers. The revenues from financing fees
      and
      vehicle service contract fees are recorded at the time of the sale of the
      vehicles, net of a reserve for estimated future chargebacks based on historical
      operating results and the termination provisions of the applicable contracts.




*Major
      Supplier and Dealer Agreements.* We
      purchase substantially all of our new recreational vehicles and replacement
      parts from various manufacturers at the prevailing prices charged to all
      authorized dealers. We are subject to dealer agreements with each manufacturer.
      The manufacturer is entitled to terminate the dealer agreement if we are in
      material breach of their agreement terms.





*Goodwill
      and Other Intangible Assets.* Goodwill
      represents the excess of costs over fair value of net assets of an acquired
      business. Pursuant to Statement of Financial Accounting Standards ("SFAS")
      No.
      142," Goodwill and Other Intangible Assets," goodwill and intangible assets
      acquired in a purchase business combination and determined to have an indefinite
      life are not amortized, but instead tested for impairment at least annually.
      At
      December 31, 2006 and 2005, management determined there was no impairment of
      goodwill. SFAS No. 142 also requires that intangible assets with estimable
      useful lives be amortized over their respective estimated useful lives, assessed
      annually, and reviewed for impairment in accordance with SFAS No. 144,
      "Accounting for Impairment or Disposal of Long-Lived Assets."





Intangible
      assets include manufacturing relationships, non-compete agreement, customer
      database, trade names and trademarks. Amortizable intangible assets are being
      amortized using the straight-line method over 40 years for manufacturer
      relationships, five years for the non-compete agreement and one year for the
      customer database. Trade names and trademarks are considered to have indefinite
      useful lives and are not being amortized.





*LIFO
      Inventory Accounting.* Vehicle
      and parts inventories are recorded at the lower of cost or market, with cost
      determined by the last-in, first-out (“LIFO”) method. If the first-in, first-out
      (“FIFO”) method of inventory costing had been used, net income would have
      decreased by approximately $1,177,000 for the year ended December 31, 2006
      and
      increased approximately $1,523,000 and $1,351,000 for the years ended December
      31, 2005 and 2004, respectively.





28


**Recent
      Accounting Pronouncements**




See
      Recent Accounting Pronouncements in Note 1 of Notes to Financial
      Statements.





**Inflation**




Although
      we cannot accurately anticipate the effect of inflation on our operations,
      we
      believe that inflation has not had, and is not likely in the foreseeable future
      to have, a material impact on our results of operations.




**Cyclicality**




Unit
      sales of RV vehicles historically have been cyclical, fluctuating with general
      economic cycles. During economic downturns, the RV retailing industry tends
      to
      experience similar periods of decline and recession as the general economy.
      We
      believe that the industry is influenced by general economic conditions and
      particularly by consumer confidence, the level of personal discretionary
      spending, fuel prices, interest rates and credit availability.




**Seasonality
      and Effects of Weather**




Our
      operations generally experience higher volumes of vehicle sales in the first
      and
      fourth quarters of each year due in part to consumer buying trends and our
      hospitable warm climate during the winter months. The service and parts business
      experiences relatively modest seasonal fluctuations.




We
      have a
      single location near Tampa, Florida, which is in close proximity to the Gulf
      of
      Mexico. As a single-site operator, a severe weather event such as a hurricane
      could cause severe damage to our property and inventory. In addition, such
      weather events can cause extended disruptions of our operations. In 2005 and
      2006, the coastal areas of Florida were evacuated on occasions due to
      hurricanes. While this did not materially impact our business or results of
      operations, we can provide no assurance that a future hurricane or other local
      disaster could not do so in the future. Although we believe we have adequate
      insurance coverage (including business interruption coverage), if we were to
      experience a catastrophic loss, we may exceed our policy limits and /or we
      may
      have difficulty obtaining similar insurance coverage in the future.




**ITEM 7A.
      QUANTITATIVE
      AND QUALITATIVE DISCLOSURES
      ABOUT MARKET RISK**




*Interest
      Rates.* We are
      exposed to market risk from changes in the interest rates on a significant
      portion of our outstanding indebtedness. Outstanding balances under our senior
      secured revolving credit facility bear interest at a variable rate based on
      prime or LIBOR as adjusted each interest period. There were no borrowings
      outstanding at December 31, 2006. Amounts outstanding under floor plan
      financing arrangements bear interest at a variable rate based on prime or LIBOR
      as adjusted each interest period. As of December 31, 2006, based on the
      aggregate amount of $67.3 million outstanding under our amended floor plan
      financing facility as of such date, a 100 basis point change in interest rates
      would have changed our annual floor plan interest expense by approximately
      $0.7 million.





We
      continually evaluate our exposure to interest rate fluctuations and follow
      established policies and procedures to implement strategies designed to manage
      the amount of variable rate indebtedness outstanding at any point in time in
      an
      effort to mitigate the effect of interest rate fluctuations on our earnings
      and
      cash flows.




Interest
      rate fluctuations affect the fair market value of our fixed rate debt, including
      the notes, but with respect to such fixed rate instruments, do not impact our
      earnings or cash flows.




*Foreign
      Currency Exchange Rates.* We
      currently have very limited exposure to exchange rate risk as we have very
      limited foreign operations. Nearly all of our new and pre-owned vehicle
      inventories are sourced domestically.




29


**ITEM 8.
      FINANCIAL STATEMENTS
      AND SUPPLEMENTARY DATA**




**Index
      to Financial Statements**




Report
                of Independent Registered Public Accounting Firm
            31Financial
                Statements:Balance
                Sheets as of December 31, 2006 and 2005
            32Statements
                of Income for the years ended December 31, 2006, 2005 and
                2004
            34Statements
                of Stockholder’s Equity (Deficiency) for the years ended December 31,
                2006, 2005 and 2004
            35Statements
                of Cash Flows for the years ended December 31, 2006, 2005 and
                2004
            36Notes
                to Financial Statements
            38Financial
                Statement Schedule:Schedule
                II: Valuation and Qualifying Accountsfor the years ended December 31, 2006, 2005 and 2004
            51




30


**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**







Board
      of
      Directors


Lazy
      Days’ R.V. Center, Inc.


Seffner,
      Florida




We
      have
      audited the accompanying balance sheets of Lazy Days’ R.V. Center, Inc., a
      wholly owned subsidiary of LD Holdings, Inc., as of December 31, 2006 and 2005,
      and the related statements of income, stockholder’s equity (deficiency) and cash
      flows for each of the three years in the period ended December 31, 2006. 
Our audits also included the financial statement schedule listed in Item 15(a)
      (2). These financial statements and financial statement schedule are the
      responsibility of the Company’s management. Our responsibility is to express an
      opinion on these financial statements and financial statement schedule based
      on
      our audits.





We
      conducted our audits in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the financial
      statements are free of material misstatement. An audit includes examining,
      on a
      test basis, evidence supporting the amounts and disclosures in the financial
      statements. An audit also includes assessing the accounting principles used
      and
      significant estimates made by management, as well as evaluating the overall
      financial statement presentation. We believe that our audits provide a
      reasonable basis for our opinion.





In
      our
      opinion, the financial statements referred to above present fairly, in all
      material respects, the financial position of Lazy Days’ R.V. Center, Inc. as of
      December 31, 2006 and 2005, and the results of its operations and its cash
      flows
      for each of the three years in the period ended December 31, 2006 in conformity
      with U.S. generally accepted accounting principles. In addition, in our opinion,
      the financial statement schedule referred to above, when considered in relation
      to the basic financial statements taken as a whole, presents fairly, in all
      material respects, the information required to be included therein.




As
      disclosed in Note 1 to the financial statements,
      the Company has adopted Staff Accounting Bulletin 108, "Considering the Effects
      of Prior Year Misstatements when Quantifying Misstatements in Current Year
      Financial Statements" and accordingly adjusted asset and liabilities at the
      beginning of 2006 with an offsetting adjustment to the opening balance of
      retained earnings.




Crowe
              Chizek and Company LLC


Ft.
                Lauderdale, FloridaMarch
                20, 2007







31


**LAZY
      DAYS’ R.V. CENTER, INC., a wholly owned**


**subsidiary
      of LD Holdings, Inc.**


**BALANCE
      SHEETS**


**December 31,
      2006 and 2005**




**ASSETS**
            
            **2006**
            
            **2005**Current
                assetsCash
            
            $
            3,253,637
            
            $
            4,726,164Receivables,
                net of allowance for doubtful accounts of$
                549,307 in 2006 and $279,557 in 2005
            
            
            15,514,990
            
            
            21,854,867Refundable
                income taxes
            
            
            377,633
            
            
            491,266Inventories
            
            
            100,688,336
            
            
            87,391,692Prepaid
                expenses and other
            
            
            3,001,928
            
            
            2,061,728Total
                current assets
            
            
            122,836,524
            
            
            116,525,717Property
                and equipment, net
            
            
            36,970,987
            
            
            37,168,221Loan
                and other costs, net
            
            
            4,647,963
            
            
            5,348,787Goodwill
            
            
            104,865,672
            
            
            104,865,672Intangible
                assets, net
            
            
            75,222,812
            
            
            77,690,313Deferred
                income taxes
            
            
            —
            
            
            2,180,727Other
                assets
            
            
            228,445
            
            
            242,792Total
                assets
            
            $
            344,772,403
            
            $
            344,022,229




See
      accompanying notes to financial statements.




32


**LAZY
      DAYS’ R.V. CENTER, INC., a wholly owned**


**subsidiary
      of LD Holdings, Inc.**


**BALANCE
      SHEETS (Continued)**


**December 31,
      2006 and 2005**




**LIABILITIES
                AND STOCKHOLDER’S EQUITY**
            
            **2006**
            
            **2005**Current
                liabilitiesFloor
                plan notes payable
            
            $
            67,275,431
            
            $
            74,608,769Current
                maturities of long-term debt
            
            
            —
            
            
            147,374Accounts
                payable and accrued expenses
            
            
            11,903,098
            
            
            13,310,162Accrued
                interest
            
            
            2,548,495
            
            
            2,608,414Reserve
                for charge-backs
            
            
            1,110,000
            
            
            1,121,000Customer
                deposits
            
            
            1,421,168
            
            
            982,871Deferred
                income taxes
            
            
            2,157,135
            
            
            394,306Total
                current liabilities
            
            
            86,415,327
            
            
            93,172,896Long-term
                debt, less current maturities
            
            
            140,796,654
            
            
            143,790,776Reserve
                for charge-backs
            
            
            1,042,000
            
            
            964,000Deferred
                rent
            
            
            14,134,249
            
            
            1,802,460Deferred
                income taxes
            
            
            28,707,187
            
            
            32,776,649Other
            
            
            11,494
            
            
            18,428Total
                liabilities
            
            
            271,106,911
            
            
            272,525,209Commitments
                and contingencies (Notes 7 and 12)Stockholder’s
                equityCommon
                stock, $.01 par value: 1,000 shares authorized 100 shares issued
                and
                outstanding
            
            
            1
            
            
            1Paid-in
                capital
            
            
            67,000,000
            
            
            67,000,000Retained
                earnings
            
            
            6,665,491
            
            
            4,497,019Total
                stockholder’s equity
            
            
            73,665,492
            
            
            71,497,020Total
                liabilities and stockholder’s equity
            
            $
            344,772,403
            
            $
            344,022,229




See
      accompanying notes to financial statements.




33


**LAZY
      DAYS’ R.V. CENTER, INC., a wholly owned**


**subsidiary
      of LD Holdings, Inc.**


**STATEMENTS
      OF INCOME**


**Years
      ended December 31, 2006, 2005 and 2004**




**2006**
            
            **2005**
            
            **2004**RevenuesNew
                vehicle
            
            $
            445,576,274
            
            $
            475,711,502
            
            $
            477,166,249Pre-owned
                vehicle
            
            
            248,615,409
            
            
            263,742,360
            
            
            260,018,300Parts,
                service and other
            
            
            38,838,477
            
            
            40,851,104
            
            
            38,546,384Finance
                and insurance
            
            
            21,194,556
            
            
            21,392,249
            
            
            22,322,793Rally
                Park
            
            
            1,516,255
            
            
            1,507,987
            
            
            1,380,238Other
            
            
            1,527,509
            
            
            993,029
            
            
            275,744Total
                revenues
            
            
            757,268,480
            
            
            804,198,231
            
            
            799,709,708Cost
                of revenuesNew
                vehicle
            
            
            405,092,871
            
            
            432,969,891
            
            
            435,993,484Pre-owned
                vehicle
            
            
            222,057,139
            
            
            233,279,554
            
            
            232,076,567Parts,
                service and other
            
            
            16,221,390
            
            
            18,057,467
            
            
            15,344,873Total
                cost of revenues
            
            
            643,371,400
            
            
            684,306,912
            
            
            683,414,924Gross
                profit
            
            
            113,897,080
            
            
            119,891,319
            
            
            116,294,784Selling,
                general and administrative expenses
            
            
            89,659,367
            
            
            91,963,731
            
            
            90,380,339Interest
                expense
            
            
            21,326,939
            
            
            21,378,239
            
            
            14,731,302Income
                before income taxes
            
            
            2,910,774
            
            
            6,549,349
            
            
            11,183,143Income
                tax expense
            
            
            1,110,066
            
            
            2,487,110
            
            
            3,354,432Net
                income
            
            $
            1,800,708
            
            $
            4,062,239
            
            $
            7,828,711




See
      accompanying notes to financial statements.




34


**LAZY
      DAYS’ R.V. CENTER, INC., a wholly owned**


**subsidiary
      of LD Holdings, Inc.**


**STATEMENTS
      OF STOCKHOLDER’S EQUITY (DEFICIENCY)**


**Years
      ended December 31, 2006, 2005 and 2004**





**Common
                Stock**
            
            
            
            
            
            
            
            
            
            **Total
                Stockholder’s Equity**
              **(Deficiency)****Shares**
            
            **Amount**
            
            **Preferred
                Stock**
            
            **Paid-in**
              **Capital**
            
            **Unearned
                ESOP Shares**
            
            **Retained
                Earnings (Deficit)**Balances,
                January 1, 2004
            
            
            1,727,377
            
            $
            17,275
            
            $
            10,675,448
            
            $
            —
            
            $
            (114,129,813
            )
            $
            (128,367
            )
            $
            (103,565,457
            )Net
                income
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            7,828,711
            
            
            7,828,711Release
                of ESOP shares
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            4,775,000
            
            
            (4,241,000
            )
            
            534,000Tax
                benefit of ESOP
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            1,696,400
            
            
            1,696,400Accumulated
                dividends on
              preferred
                stock
            
            
            —
            
            
            —
            
            
            322,399
            
            
            —
            
            
            —
            
            
            (3,682,057
            )
            
            (3,359,658
            )Sale
                of LD Holdings’ stock (Note 2)
            
            
            (1,727,277
            )
            
            (17,274
            )
            
            (10,997,847
            )
            
            —
            
            
            109,354,813
            
            
            (1,038,907
            )
            
            97,300,785Capital
                contributions of parents
            
            
            —
            
            
            —
            
            
            —
            
            
            67,000,000
            
            
            —
            
            
            —
            
            
            67,000,000Balances,
                December 31, 2004
            
            
            100
            
            
            1
            
            
            —
            
            
            67,000,000
            
            
            —
            
            
            434,780
            
            
            67,434,781Net
                income
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            4,062,239
            
            
            4,062,239Balances,
                December 31, 2005
            
            
            100
            
            
            1
            
            
            —
            
            
            67,000,000
            
            
            —
            
            
            4,497,019
            
            
            71,497,020Cumulative
                effect adjustment, adoption of SAB 108, net of tax
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            367,764
            
            
            367,764Net
                income
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            1,800,708
            
            
            1,800,708Balances,
                December 31, 2006
            
            
            100
            
            $
            1
            
            $
            —
            
            $
            67,000,000
            
            $
            —
            
            $
            6,665,491
            
            $
            73,665,492




See
      accompanying notes to financial statements.




35


**LAZY
      DAYS’ R.V. CENTER, INC., a wholly owned**


**subsidiary
      of LD Holdings, Inc.**


**STATEMENTS
      OF CASH FLOWS**


**Years
      ended December 31, 2006, 2005 and 2004**




**2006**
            
            **2005**
            
            **2004**Cash
                flows from operating activitiesNet
                income
            
            $
            1,800,708
            
            $
            4,062,239
            
            $
            7,828,711Adjustments
                to reconcile net income to net cash from operating
                activitiesDepreciation
                of property and equipment
            
            
            3,197,389
            
            
            2,867,072
            
            
            2,398,890Depreciation
                of rental vehicle inventory
            
            
            435,222
            
            
            3,230,241
            
            
            2,158,294Amortization
                of intangible assets
            
            
            2,467,501
            
            
            3,817,499
            
            
            3,792,188Amortization
                and write-off of loan and other costs
            
            
            1,489,452
            
            
            1,309,655
            
            
            3,646,801Amortization
                of discount on long-term debt
            
            
            257,878
            
            
            307,357
            
            
            150,219(Gain)
                loss on sale of property and equipment
            
            
            (3,156
            )
            
            31,815
            
            
            79,950Loss
                on extinguishment of debt
            
            
            101,970
            
            
            348,885
            
            
            —Provision
                for doubtful accounts
            
            
            297,484
            
            
            56,298
            
            
            205,865ESOP
                compensation expense
            
            
            —
            
            
            —
            
            
            534,000Tax
                benefit of ESOP
            
            
            —
            
            
            —
            
            
            1,696,400Deferred
                income taxes
            
            
            (346,565
            )
            
            (95,721
            )
            
            (705,204
            )Change
                in operating assets and liabilities, net of effect of
                business
              acquisition
                in 2004Receivables
            
            
            6,042,393
            
            
            (7,715,526
            )
            
            (690,846
            )Inventories
            
            
            (13,731,866
            )
            
            (4,661,086
            )
            
            (13,178,729
            )Prepaid
                expenses and other
            
            
            (940,200
            )
            
            (241,508
            )
            
            (48,998
            )Refundable
                income taxes
            
            
            113,633
            
            
            7,012,603
            
            
            (6,134,924
            )Other
                assets
            
            
            14,347
            
            
            (84,069
            )
            
            (54,558
            )Restricted
                cash
            
            
            —
            
            
            —
            
            
            624,349Accounts
                payable, accrued interest, other accrued
              expenses
                and customer deposits
            
            
            (447,197
            )
            
            (4,033,189
            )
            
            5,311,962Reserve
                for charge-backs
            
            
            67,000
            
            
            51,000
            
            
            265,000Income
                taxes payable
            
            
            —
            
            
            —
            
            
            (1,632,557
            )Deferred
                rent
            
            
            731,789
            
            
            (81,930
            )
            
            184,540Deferred
                compensation
            
            
            —
            
            
            —
            
            
            (3,622,929
            )Net
                cash from operating
                activities
            
            
            1,547,782
            
            
            6,181,635
            
            
            2,808,424Cash
                flows from investing activitiesProceeds
                from sale of property and equipment
            
            
            17,030
            
            
            12,099
            
            
            4,696Purchases
                of property and equipment
            
            
            (3,014,029
            )
            
            (4,658,254
            )
            
            (3,515,503
            )Net
                advance to parent
            
            
            3⁄4
            
            
            —
            
            
            (104,147,631
            )Net
                cash used in investing activities
            
            
            (2,996,999
            )
            
            (4,646,155
            )
            
            (107,658,438
            )




See
      accompanying notes to financial statements.





36
 **LAZY
          DAYS’ R.V. CENTER, INC., a wholly owned**
 **subsidiary
          of LD Holdings, Inc.**
 **STATEMENTS
          OF CASH FLOWS (Continued)**
 **Years
          ended December 31, 2006, 2005 and 2004**


**2006**
            
            **2005**
            
            **2004**Cash
                flows from financing activitiesNet
                borrowings (payments) under floor plan
            
            $
            (7,333,338
            )
            $
            5,032,639
            
            $
            17,530,149Issuance
                of long-term debt
            
            
            —
            
            
            —
            
            
            150,077,200Proceeds
                from lease renegotiation
            
            
            11,600,000
            
            
            —
            
            
            —Repayments
                of long-term debt
            
            
            (3,501,344
            )
            
            (6,945,511
            )
            
            (57,815,551
            )Repayments
                of ESOP distribution notes
            
            
            —
            
            
            —
            
            
            (1,230,768
            )Loan
                and other costs
            
            
            (788,628
            )
            
            —
            
            
            (7,183,371
            )Purchase
                of treasury stock of parent
            
            
            —
            
            
            —
            
            
            —Net
                cash from (used in) financing activities
            
            
            (23,310
            )
            
            (1,912,872
            )
            
            101,377,659Net
                change in cash
            
            
            (1,472,527
            )
            
            (377,392
            )
            
            (3,472,355
            )Cash
                at beginning of year
            
            
            4,726,164
            
            
            5,103,556
            
            
            8,575,911Cash
                at end of year
            
            $
            3,253,637
            
            $
            4,726,164
            
            $
            5,103,556Supplemental
                disclosure of cash flow informationCash
                paid during the year for interest
            
            $
            21,386,858
            
            $
            21,366,097
            
            $
            12,653,815Cash
                paid (received) during the year for income taxes
            
            
            1,345,000
            
            
            (4,429,772
            )
            
            10,130,717Noncash
                investing and financing activitiesIn
                connection with the acquisition of businessFair
                value of assets acquired
            
            $
            —
            
            $
            —
            
            $
            325,115,634Liabilities
                assumed
            
            
            —
            
            
            —
            
            
            108,038,434




See
      accompanying notes to financial statements.




37


**LAZY
      DAYS’ R.V. CENTER, INC., a wholly owned**


**subsidiary
      of LD Holdings, Inc.**


**NOTES
      TO FINANCIAL STATEMENTS**


**December 31,
      2006, 2005 and 2004**




**NOTE
      1 - NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES**




Basis
      of Presentation: The
      financial statements include the accounts of Lazy Days’ R.V. Center, Inc. (“Lazy
      Days” or the “Company”), a wholly owned subsidiary of LD Holdings, Inc. (“LD
      Holdings”), a non-operating holding company. LD Holdings was acquired on
      May 14, 2004 by R.V. Acquisition, Inc. (“RV Acquisition”), a newly formed
      holding company owned by an affiliate of Bruckman, Rosser, Sherrill &
Co., Inc. (“BRS”) and certain original shareholders of LD Holdings (See Note 2).
      These financial statements include the accounts of Lazy Days and any obligations
      of LD Holdings that are pushed down to the subsidiary level. These obligations
      include the redeemable preferred stock - Class A (See Note 14).




Business
      Operations :
      The
      Company sells and services new and pre-owned recreational vehicles and related
      parts and accessories. It also offers to its customers such ancillary services
      as extended service contracts and overnight campground facilities. The Company
      also arranges financing for vehicle sales through third-party financing sources.
      The majority of the vehicle receivables are due from financial institutions.




Major
      Suppliers and Dealer Agreements :
      The
      Company purchases substantially all of its new recreational vehicles and
      replacement parts from various manufacturers. The Company purchases new vehicles
      from four major suppliers which, including new vehicles purchased under
      consignment arrangements (See Note 12), represented approximately 78%, 81%
      and
      86% of the total cost of new vehicle revenues for the years ended
      December 31, 2006, 2005 and 2004, respectively.




The
      Company is subject to dealer agreements with each manufacturer. The manufacturer
      is entitled to terminate the dealer agreement if the Company is in material
      breach of their agreement terms.




Cash :
      Cash
      consists of a normal business checking account with its bank, the first $100,000
      of which is insured by an agency of the federal government.




Revenue
      Recognition :
      Revenue
      from the sale of vehicles is recognized on delivery, transfer of title and
      completion of financing arrangements. Revenue from parts sales and service
      is
      recognized on delivery of service or product. Rental revenue is recorded as
      unearned revenue at lease inception and recognized ratably over the term of
      the
      lease.




The
      Company receives commissions from the sale of insurance and vehicle service
      contracts to customers. In addition, the Company arranges financing for
      customers through various financial institutions and receives commissions.




The
      Company may be charged back (“charge-backs”) for financing fees, insurance or
      vehicle service contract commissions in the event of early termination of the
      contracts by the customers. The revenues from financing fees and commissions
      are
      recorded at the time of the sale of the vehicles and a reserve for future
      charge-backs is established based on historical operating results and the
      termination provisions of the applicable contracts.




Receivables
      and Concentration of Credit Risk :
      The
      Company sells to customers and arranges third-party financing as is customary
      in
      its industry. Interest is not normally charged on receivables. Management
      establishes an allowance for doubtful accounts based on historic loss experience
      and current economic conditions. Losses are charged to the allowance when
      management deems further collection efforts will not produce additional
      recoveries.




During
      the year ended December 31, 2006, approximately 64% of unit sales were to
      customers in the State of Florida. This geographic concentration increases
      the
      Company’s exposure to adverse developments related to competition, as well as
      economic, demographic and other changes in this region.





Inventories :
      Vehicle
      and parts inventories are recorded at the lower of cost or market, with cost
      determined by the last-in, first-out (“LIFO”) method. If the first-in, first-out
      (“FIFO”) method of inventory costing had been used, net income would have
      decreased by approximately $1,177,000 for the year ended December 31, 2006
      and
      increased approximately $1,523,000 and $1,351,000 for the years ended
      December 31, 2005 and 2004, respectively.




38


Property
      and Equipment :
      Property and equipment are stated at cost less accumulated depreciation.
      Expenditures for maintenance and repairs are charged to expense in the period
      incurred. Betterments and additions are capitalized. Depreciation is generally
      provided under accelerated and straight-line methods over estimated useful
      lives
      for both financial reporting and income tax purposes. For financial reporting
      purposes, leasehold improvements are amortized using the straight-line method
      over the lesser of the useful life of the asset or term of the lease. Useful
      lives range from 15 to 25 years for buildings and improvements and from 3 to
      7
      years for vehicles and equipment. Upon sale or retirement of items of property
      and equipment, the cost and related accumulated depreciation are eliminated
      from
      the accounts and the resulting gain or loss, if any, is reflected in earnings
      of
      the period of disposition.





Evaluation
      of Impairment of Long-Lived Assets :
      In
      accordance with Statement of Financial Accounting Standard (“SFAS”)
      No. 144, “Impairment or Disposal of Long-Lived Assets”, the Company
      evaluates the carrying value of long-lived assets whenever significant events
      or
      changes in circumstances indicate the carrying value of these assets may be
      impaired. The Company evaluates potential impairment of long-lived assets by
      comparing the carrying value of the assets to the expected net future cash
      flows
      resulting from the use of the assets. Management believes no material impairment
      of long-lived assets exists at December 31, 2006 and 2005.




Loan
      and Other Costs :
      Loan
      and other costs are amortized on a straight-line basis over the life of the
      related loans ranging from 2  1/2 to 15
      years. Unamortized loan costs of $339,000 were written off in connection with
      the refinancing of the Company’s line of credit during 2006, and new loan costs
      of approximately $789,000 were capitalized as part of its property lease
      renegotiation. Loan costs are presented net of accumulated amortization of
      approximately $2,843,000 and $1,835,000 at December 31, 2006 and 2005,
      respectively.




Goodwill
      and Other Intangible Assets: ** Goodwill,
      totaling $104,865,672 at December 31, 2006 and 2005, represents the excess
      of
      costs over fair value of net assets of an acquired business. Pursuant to
      Statement of Financial Accounting Standards ("SFAS") No. 142," Goodwill and
      Other Intangible Assets," goodwill and intangible assets acquired in a purchase
      business combination and determined to have an indefinite life are not
      amortized, but instead tested for impairment at least annually. At December
      31,
      2006 and 2005, management determined there was no impairment of goodwill. SFAS
      No. 142 also requires that intangible assets with estimable useful lives be
      amortized over their respective estimated useful lives, assessed
      annually, and reviewed for impairment in accordance with SFAS No. 144,
      "Accounting for Impairment or Disposal of Long-Lived Assets."





Intangible
      assets include manufacturing relationships, non-compete agreement, customer
      database, trade names and trademarks. Amortizable intangible assets are being
      amortized using the straight-line method over 40 years for manufacturer
      relationships, five years for the non-compete agreement and one year for the
      customer database. Trade names and trademarks are considered to have indefinite
      useful lives and are not being amortized.





Fair
      Value of Financial Instruments :
      The
      Company’s financial instruments consist of cash, receivables, accounts
      payable and debt. Fair values of cash, receivables and accounts payable
      approximate carrying values for these financial instruments since they are
      relatively short-term in nature. The carrying amount of debt, except for the
      Company’s Senior Notes (See Note 9), approximates fair value due either to
      length of maturity or existence of variable interest rates that approximate
      prevailing market rates.




Advertising
      Costs :
      Advertising and promotion costs are charged to operations in the year incurred
      and totaled approximately $6,630,000, $6,006,000 and $4,820,000 for the years
      ended December 31, 2006, 2005 and 2004, respectively.




Segment
      Information :
      The
      Company follows the provisions of SFAS No. 131, “Disclosures about Segments
      of an Enterprise and Related Information”. Based upon definitions contained in
      SFAS No. 131, the Company has determined that it operates in one segment
      and has no international operations. The Company’s operating business delivers
      the same products and services to a common group. The Company’s customers are
      generally individuals. The Company’s business generally follows the same
      management and marketing strategies, and operates in a similar regulatory
      environment.




Income
      Taxes :
      Deferred income taxes are determined using the liability method. A valuation
      allowance, if necessary, is established to reduce net deferred tax assets to
      an
      amount that is more likely than not to be realized.




39


Use
      of
      Estimates in the Preparation of Financial Statements :
      The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect the reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and the reported amounts of revenues and expenses
      during the reporting period. Actual results could differ from those estimates.
      Significant estimates include the deferred tax valuation allowance, reserve
      for
      charge-backs and the allowance for doubtful accounts.





Reclassifications: Certain
      prior years’ amounts have been reclassified to conform to the current year
      presentation. These reclassifications had no effect on stockholder’s equity or
      net income as previously reported.




Recent
      Accounting Pronouncements : In
      July
      2006, the Financial Accounting Standards Board issued Financial Interpretation
      No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). This
      Interpretation revises the recognition test for tax positions taken in tax
      returns such that a tax benefit is recorded only when it is more likely than
      not
      that the tax position will be allowed upon examination by taxing authorities.
      The amount of such a tax benefit to be recorded is the largest amount that
      is
      more likely than not to be allowed. Any reduction in deferred tax assets or
      increase in tax liabilities upon adoption will correspondingly reduce retained
      earnings. FIN 48 is effective for fiscal years beginning after December 15,
      2006. The Company will adopt FIN 48 as of January 1, 2007, the first day of
      the
      Company's fiscal year ending December 31, 2007. The Company is currently
      assessing the impact of the adoption of FIN 48.




In
      September 2006, the Securities and Exchange Commission ("SEC") staff issued
      Staff Accounting Bulletin ("SAB") No. 108, "Considering the Effects of Prior
      Year Misstatements when Quantifying Misstatements in Current Year Financial
      Statements." SAB 108 was issued in order to eliminate the diversity of practice
      surrounding how public companies quantify financial statement misstatements.
      In
      SAB 108, the SEC staff established an approach that requires quantification
      of
      financial statement misstatements based on the effects of the misstatements
      on
      each of the company's financial statements and the related financial statement
      disclosures. This model is commonly referred to as a "dual approach" because
      it
      requires quantification of errors under both the iron curtain and the roll-over
      methods. SAB 108 permits existing public companies to initially apply its
      provisions either by (i) restating prior financial statements as if the "dual
      approach" had always been used or (ii) recording the cumulative effect of
      initially applying the "dual approach" as adjustments to the carrying values
      of
      assets and liabilities as of January 1, 2006 with an offsetting adjustment
      recorded to the opening balance of retained earnings.





The
      Company has elected to apply the provisions of SAB 108 using the cumulative
      effect transition method in connection with the preparation of the financial
      statements for the year ended December 31, 2006. As a result, the Company
      recorded a decrease in accrued liabilities and an increase in retained earnings
      in the amount of approximately $368,000, net of tax, as of January 1, 2006.
      This
      adjustment resulted from the Company overstating liabilities for sales
      promotional items, which was deemed immaterial to the financial statements
      in
      each respective period. This misstatement, increased (decreased) net income
      in
      the year reported, originated as follows: 2005 - $128,000; 2004 - ($60,000);
      and, prior to 2004 - ($436,000).





40


**NOTE
      2 - ACQUISITION**




On
      May 14, 2004, RV Acquisition purchased all of the issued and outstanding
      shares of capital stock of LD Holdings for a total purchase price of $217.1
      million (the “Acquisition”). The Acquisition has been accounted for as a
      purchase and, accordingly, the acquired assets and liabilities assumed have
      been
      recorded at their estimated fair values at the date of acquisition and
      approximate the following:




Cash
            
            $
            6,438,002Other
                current assets
            
            
            85,649,891Property
                and equipment
            
            
            33,547,745Other
                assets
            
            
            639,011Loan
                and other costs
            
            
            7,183,371Intangible
                assets
            
            
            85,300,000Goodwill
            
            
            106,357,614Current
                liabilities
            
            
            (66,688,430
            )Other
                liabilities
            
            
            (5,443,754
            )Deferred
                income taxes
            
            
            (35,906,250
            )$
            217,077,200




Amortization
      expense related to intangible assets totaled $3,792,188 for the period
      May 14, 2004 to December 31, 2004 (See Note 6). In addition,
      depreciation expense related to the step-up in basis of property and equipment
      of $10,450,000 totaled approximately $295,000 for the period May 14, 2004
      to December 31, 2004.





The
      final
      allocation of the purchase price was completed during 2005 and resulted in
      a net
      $1,491,942 decrease in the excess purchase price allocated to goodwill. The
      decrease primarily related to the identification of a deferred tax asset for
      certain transaction costs deductible for tax purposes.




In
      connection with the Acquisition, the Company entered into a management services
      agreement with BRS and a shareholder of LD Holdings, whereby the parties agreed
      to provide general management services to the Company, as defined. In exchange
      for these services, the Company agreed to pay the parties an annual management
      fee equal to the greater of: 1.75% of the Company’s annual EBITDA, as defined,
      or $500,000. Management fee expense for the years ended December 31, 2006,
      2005 and 2004 was $553,030, $726,081 and $321,108, respectively.




**NOTE
      3 - RECEIVABLES**




Receivables
      consist of the following:


**2006**
            
            **2005**Contracts
                in transit and vehicle receivables
            
            $
            9,262,233
            
            $
            15,522,299Manufacturer
                receivables
            
            
            5,371,397
            
            
            5,419,335Finance
                and other receivables
            
            
            1,430,667
            
            
            1,192,79016,064,297
            
            
            22,134,424Less:
                Allowance for doubtful accounts
            
            
            549,307
            
            
            279,557$
            15,514,990
            
            $
            21,854,867




Contracts
      in transit represent receivables from financial institutions for the portion
      of
      the vehicle sales price financed by the Company’s customers through financing
      sources arranged by the Company. Manufacturer
      receivables are due from the manufacturers for incentives, rebates and other
      programs.





41


**NOTE
      4 - INVENTORIES**




Inventories
      consist of the following:




**2006**
            
            **2005**New
                recreational vehicles
            
            $
            68,398,121
            
            $
            62,449,704Pre-owned
                recreational vehicles
            
            
            32,386,060
            
            
            25,822,589Parts,
                accessories and other
            
            
            1,707,848
            
            
            1,250,745102,492,029
            
            
            89,523,038Less:
                LIFO reserve
            
            
            1,810,355
            
            
            3,709,236100,681,674
            
            
            85,813,802Rental
                recreational vehicles, less accumulated depreciation of $38,775 in
                2006
                and $367,956 in 2005
            
            
            6,662
            
            
            1,577,890$
            100,688,336
            
            $
            87,391,692




**NOTE
      5 - PROPERTY AND EQUIPMENT**




Property
      and equipment consist of the following:




**2006**
            
            **2005**Buildings
                and improvements
            
            $
            35,643,968
            
            $
            42,306,666Furniture
                and equipment
            
            
            13,857,169
            
            
            8,983,175Company
                vehicles
            
            
            390,521
            
            
            370,224Construction
                in progress
            
            
            3⁄4
            
            
            2,198,28949,891,658
            
            
            53,858,354Less:
                Accumulated depreciation and amortization
            
            
            12,920,671
            
            
            16,690,133$
            36,970,987
            
            $
            37,168,221




Depreciation
      expense of property and equipment aggregated $3,197,389, $2,867,072 and
      $2,398,890 for the years ended December 31, 2006, 2005 and 2004,
      respectively.





As
      discussed further in Note 7, effective October 12, 2006, the Company amended
      its
      existing lease agreement with a certain related party, which permitted the
      lessor to purchase certain of the Company's buildings located on land leased
      by
      the Company.  The transaction was treated as capital financing transaction
      and the assets have remained on the Company's accounting books and records;
      however, the cost basis of the assets for financial reporting purposes was
      reset
      to the net carrying value at the time of the transaction.




42


**NOTE
      6 - INTANGIBLE ASSETS**




Intangible
      assets (all acquired in connection with the acquisition described in Note 2)
      and
      the related accumulated amortization as of December 31, 2006 and 2005 are
      summarized as follows:




**2006**
            
            **2005****Gross
                Carrying Amount**
            
            **Accumulated**
              **Amortization**
            
            **Gross
                C****arrying
                Amount**
            
            **Accumulated
                Amortization**Amortizable
                intangible assets:Manufacturer
                relationships
            
            $
            26,700,000
            
            $
            1,752,188
            
            $
            26,700,000
            
            $
            1,084,687Non-compete
                agreement
            
            
            9,000,000
            
            
            4,725,000
            
            
            9,000,000
            
            
            2,925,000Customer
                database
            
            
            3,600,000
            
            
            3,600,000
            
            
            3,600,000
            
            
            3,600,00039,300,000
            
            
            10,077,188
            
            
            39,300,000
            
            
            7,609,687Unamortizable
                intangible assets:Trade
                names and trademarks
            
            
            46,000,000
            
            
            —
            
            
            46,000,000
            
            
            —$
            85,300,000
            
            $
            10,077,188
            
            $
            85,300,000
            
            $
            7,609,687




Amortizable
      intangible assets are being amortized using the straight-line method over 40
      years for manufacturer relationships, five years for the non- compete agreement
      and one year for the customer database. The weighted-average amortization period
      for all amortizable intangible assets acquired in 2004 is 28.4 years. Trade
      names and trademarks are considered to have indefinite useful lives and are
      not
      being amortized.




Amortization
      expense for the years ended December 31, 2006, 2005 and 2004 was
      $2,467,501, $3,817,499 and $3,792,188, respectively. Estimated amortization
      expense for each of the subsequent five years ending December 31 is: 2007 -
      $2,467,500, 2008 - $2,467,500, 2009 - $1,342,500, 2010 - $667,500, and 2011
      -
      $667,500.




**NOTE
      7 - LEASES**




The
      Company leases land and certain of its facilities from I-4 Land Holding Limited
      Company (“I-4”), a related entity owned by a shareholder of the Company, under
      an operating lease arrangement which expires in December, 2022. The lease
      contains four (4) five-year renewal options upon expiration of the original
      lease term. The lease requires minimum monthly rental payments of approximately
      $309,000 through June 30, 2004 and $399,490 thereafter before abatements
      (subject to adjustments in 2008, 2013 and 2018 for increases in the CPI) and
      provides that the lessee pays all property taxes and insurance. Rent is
      recognized straight-line over the life of the lease resulting in deferred rent
      during the earlier years of the lease. The Company is responsible for
      maintenance costs and betterments on the facilities.




On
      October 12, 2006, the Company amended this lease agreement with I-4.  The
      lease was amended to modify the purchase option from $42 million (subject to
      CPI
      increases) through May 14, 2011 to a fair market value purchase option, as
      defined, through January 15, 2023; to permit I-4 to purchase certain of the
      Company's buildings located on land leased by the Company from I-4 as part
      of an
      asset purchase agreement, as well as reduce rents owed by the Company to I-4
      by
      an aggregate of $2.7 million during 2006, 2007 and 2008. The amended lease
      agreement also gives the Company a right to purchase certain adjacent land
      currently rented by a third party.  Finally, the amended lease agreement
      and asset purchase agreement provided the Company with $11.6 million of cash,
      preserved its business use of all the leased real property and significantly
      reduced the Company's future lease obligation without increasing the existing
      lease term.  The $11.6 million of cash proceeds and the $2.7 million of
      rent abatements were treated similar to lease incentives under SFAS No. 13,
      “Accounting for Leases," are being amortized over the remaining life of the
      lease, and are presented as deferred rent on the balance sheet.





43


The
      Company also leases various office and dealership equipment under operating
      leases. These leases have terms ranging from 39 months to 66 months and expire
      through 2010.





As
      of
      December 31, 2006, future minimum lease commitments are as follows:




**Related
                Party**
            
            **Third
                Parties**2007
            
            $
            3,893,880
            
            $
            470,8252008
            
            
            3,993,880
            
            
            239,7872009
            
            
            4,793,880
            
            
            137,2912010
            
            
            4,793,880
            
            
            24,8042011
            
            
            4,793,880
            
            
            —2012
                and thereafter
            
            
            52,732,680
            
            
            —$
            75,002,080
            
            $
            872,707




Rent
      expense was approximately $5,257,000, $5,403,000, and $4,933,000 for the years
      ended December 31, 2006, 2005 and 2004, respectively, including related
      party rental expense of $4,525,669 in 2006, $4,793,880 in 2005 and $4,500,208
      in
      2004.





**NOTE
      8 - FLOOR PLAN NOTES PAYABLE**




Effective
      with the Acquisition, the Company amended its existing floor plan financing
      agreements with two financial institutions, collateralized by new and pre-owned
      recreational vehicles aggregating up to $85,000,000. The entire facility may
      be
      used to finance new vehicle inventory but only up to $26,000,000 may be used
      to
      finance pre-owned vehicle inventory. On October 28, 2004, the agreements
      were amended further to permit the Company to use floor plan credit to finance
      new vehicle inventory to be leased by the Company (“rental vehicle inventory”).
      Borrowings are not to exceed $5,000,000 in the aggregate for rental vehicle
      inventory or $35,000 per unit. The financial institutions collateralize all
      vehicles purchased under these agreements and all receivables generated from
      the
      sale of these vehicles. The interest rate charged (8.10% and 7.04% at
      December 31, 2006 and 2005, respectively) is based on the prime rate or
      LIBOR. Principal is due upon the sale of the respective vehicle.




Effective
      February 22, 2007, the Company amended the floor plan financing agreements
      extending the terms through February 22, 2011. The Company will have the option
      to increase the aggregate floor plan commitments to $100,000,000 from
      $85,000,000. The amended and restated floor plan credit facility also includes
      a
      $15,000,000 revolving credit facility (see Note 9).





The
      Company’s floor plan notes payable are subject to certain financial and
      restrictive covenants including debt service coverage ratio; current ratio;
      and
      limitations on lease rentals, certain executive compensation, capital
      expenditures, accounts payable, additional debt, liens, dividends,
      distributions, certain restricted investments, and certain other corporate
      activities, all as defined in the credit agreement. The Company was in
      compliance with all covenants or obtained a bank waiver for noncompliance at
      December 31, 2006.




Interest
      expense on the floor plan notes payable was approximately $4,170,000, $3,565,500
      and $2,441,000 for the years ended December 31, 2006, 2005 and 2004,
      respectively.




44


**NOTE
      9 - LONG-TERM DEBT**




Long-term
      debt consists of the following:





**2006**
            
            
            **2005**11.75%
                Senior Notes, due 2012, less unamortized discount of $1,207,346 in
                2006
                and $1,465,224 in 2005
            
            $
            140,796,654
            
            $
            143,938,150Current
                maturities
            
            
            —
            
            
            (147,374
            )Total
                long-term debt
            
            $
            140,796,654
            
            
            143,790,776




Concurrent
      with the Acquisition, the Company issued $152 million of unsecured, senior
      notes
      (the “Senior Notes”) through a private placement exempt from the registration
      requirements of the 1933 Securities Act. Subsequently, on December 6, 2004,
      the Company successfully completed the exchange of $137 million of its Senior
      Notes. The remaining Senior Notes totaling $15 million were not eligible for
      exchange. The Senior Notes mature May 15, 2012 and bear interest at an
      annual rate of 11.75% payable each November 15 and May 15, to the
      registered holders at the close of business on November 1 and May 1
      immediately preceding the interest payment date.




The
      Senior Notes rank pari passu with the Company’s existing and future senior debt.
      The Senior Notes are effectively subordinated to the Revolver and amended floor
      plan credit facility to the extent of the assets collateralizing such debt.




The
      Company has the option to redeem the Senior Notes at any time before
      May 15, 2008, at a defined premium plus accrued and unpaid interest to the
      date of redemption.




The
      Company shall offer to repurchase Senior Notes from all holders, on a pro rata
      basis, to the extent of 50% of the Company’s free cash flow, as defined,
      for any six-month period ending on either June 30 or December 31 of
      any fiscal year, commencing with the six-month period ending December 31,
      2004. To the extent the Company’s free cash flow for any six-month period is
      less than $1.0 million, the Company may elect not to make a free cash flow
      offer
      for such period and, in lieu thereof, add such free cash flow to the amount
      of
      free cash flow for the next succeeding six-month period. For the six months
      ended December 31, 2006 no free cash flow existed for offer.




The
      Senior Notes’ indenture includes covenants that limit the ability of the Company
      to: incur additional debt, including sale and leaseback transactions; pay
      dividends or distributions on its capital stock or repurchase capital stock;
      issue stock of subsidiaries; make certain investments; create liens on its
      assets to secure debt; enter into transactions with affiliates; merge or
      consolidate with another company; and transfer and sell assets. As noted, the
      indenture contains a covenant to limit the incurrence of additional indebtedness
      as measured by its fixed charge coverage ratio, as defined. The Company may
      incur indebtedness on or before December 31, 2006 if this ratio is greater
      than 2.0 to 1.0 or greater than 2.25 to 1.0 if such indebtedness is incurred
      thereafter. The Company will not incur pari passu indebtedness if the ratio
      is
      less than or equal to 2.5 to 1.0. The Company obtained a waiver relative to
      the
      2006 lease transaction with an affiliate, which is described in Note
      7.




The
      Company estimates the fair value of the Senior Notes at December 31, 2006
      to be approximately $134.5 million, based on their publicly traded value at
      that
      date compared to a recorded amount of $140.8 million as of December 31,
      2005.




Effective
      with the Acquisition, the Company entered into a five-year senior secured
      revolving line of credit facility (the “Revolver”). The Revolver provides for
      borrowings up to $15 million, as defined, which includes a $10 million
      sub-facility for the issuance of letters of credit. There were no outstanding
      advances under the Revolver at December 31, 2006 or December 31, 2005.
      Interest on outstanding advances is payable monthly and is based on the prime
      rate or LIBOR (9.25% and 8.25% at December 31, 2006 and 2005,
      respectively). Borrowings under the Revolver are collateralized by substantially
      all of the Company’s assets. The Revolver was terminated February 22, 2007 and
      replaced with a $15 million revolving line of credit under the same credit
      facility as the floor plan arrangement.  The terms of the new revolving
      line of credit have not significantly changed from the prior
      agreement.





The
      Company had outstanding letters of credit amounting to $2,800,000 and $2,500,000
      at December 31, 2006 and 2005, respectively.




Interest
      expense and related costs on long-term debt were approximately $17,157,000,
      $17,813,000 and $12,290,000 for the years ended December 31, 2006, 2005 and
      2004, respectively.




45


**NOTE
      10 - INCOME TAXES**




The
      components of the Company’s income tax expense are as follows:




**2006**
            
            **2005**
            
            **2004**CurrentFederal
            
            $
            1,243,803
            
            $
            3,636,468
            
            $
            2,017,826State
            
            
            212,828
            
            
            523,894
            
            
            345,4101,456,631
            
            
            4,160,362
            
            
            2,363,236DeferredFederal
            
            
            (295,736
            )
            
            (1,510,936
            )
            
            (658,167
            )State
            
            
            (50,829
            )
            
            (162,316
            )
            
            (47,037
            )(346,565
            )
            
            (1,673,252
            )
            
            (705,204
            )Tax
                benefit of ESOP deductions credited to paid-in capital
            
            
            —
            
            
            —
            
            
            1,696,400$
            1,110,066
            
            $
            2,487,110
            
            $
            3,354,432




A
      reconciliation of income taxes calculated using the statutory federal income
      tax
      rate (34% in 2006 and 2005 and 35% in 2004) to the Company’s income tax expense
      for the years ended December 31 is as follows:




**2006**
                    
                    **2005**
                    
                    **2004**Amount
                    
                    %
                    
                    Amount
                    
                    %
                    
                    Amount
                    
                    %Income
                        taxes at statutory rate
                    
                    $
                    989,663
                    
                    
                    34.0
                    %
                    $
                    2,226,779
                    
                    
                    34.0
                    %
                    $
                    3,914,100
                    
                    
                    35.0
                    %Non-deductible
                        expenses
                    
                    
                    13,484
                    
                    
                    .5
                    %
                    
                    10,128
                    
                    
                    .2
                    %
                    
                    231,380
                    
                    
                    2.1
                    %State
                        income taxes, net of federal tax benefit
                    
                    
                    106,919
                    
                    
                    3.6
                    %
                    
                    238,641
                    
                    
                    3.6
                    %
                    
                    193,942
                    
                    
                    1.7
                    %Reversal
                        of prior year tax reserves
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,000,000
                    )
                    
                    (8.9
                    )%Other,
                        net
                    
                    
                    
                    
                    
                    
                    
                    
                    11,562
                    
                    
                    .2
                    %
                    
                    15,010
                    
                    
                    .1
                    %Income
                        tax expense
                    
                    $
                    1,110,066
                    
                    
                    38.1
                    %
                    $
                    2,487,110
                    
                    
                    38.0
                    %
                    $
                    3,354,432
                    
                    
                    30.0
                    %
  46


Deferred
        tax assets
        and liabilities were as follows:


**2006**
                  
                  **2005**Deferred
                      tax assets:Inventory
                      and receivable allowances
                  
                  $
                  333,131
                  
                  $
                  224,014Reserve
                      for charge-backs
                  
                  
                  807,000
                  
                  
                  781,875Other
                      accrued liabilities
                  
                  
                  1,056
                  
                  
                  223,628Deferred
                      rent
                  
                  
                  5,645,754
                  
                  
                  675,923Unearned
                      rental income
                  
                  
                  1,421
                  
                  
                  320,308Depreciation
                      and amortization
                  
                  
                  —
                  
                  
                  154,072Other,
                      net
                  
                  
                  235,981
                  
                  
                  193,7217,024,343
                  
                  
                  2,573,541Deferred
                      tax liabilities:Prepaid
                      expenses
                  
                  
                  (510,606
                  )
                  
                  (236,549
                  )Inventories
                  
                  
                  (2,465,480
                  )
                  
                  (2,383,508
                  )Depreciation
                      and amortization
                  
                  
                  (541,500
                  )
                  
                  3⁄4Property
                      and equipment
                  
                  
                  (8,179,954
                  )
                  
                  (3,642,782
                  )Intangible
                      assets
                  
                  
                  (26,191,125
                  )
                  
                  (27,300,930
                  )(37,888,665
                  )
                  
                  (33,563,769
                  )Net
                      deferred tax liabilities
                  
                  $
                  (30,864,322
                  )
                  $
                  (30,990,228
                  )Presented
                      in the balance sheets as:Non-current
                      deferred tax assets
                  
                  $
                  —
                  
                  $
                  2,180,727Current
                      deferred tax liabilities
                  
                  
                  (2,157,135
                  )
                  
                  (394,306
                  )Long-term
                      deferred tax liabilities
                  
                  
                  (28,707,187
                  )
                  
                  (32,776,649
                  )(30,864,322
                  )
                  
                  (33,170,955
                  )$
                  (30,864,322
                  )
                  $
                  (30,990,228
                  )
 
 As
        a matter
        of course, the Company is regularly audited by various taxing authorities
        and,
        from time to time, these audits result in proposed assessments where the
        ultimate resolution may result in the Company owing additional taxes. The
        Company believes that its tax positions comply with applicable tax law and
        that
        it has adequately provided for the likely outcome related to these matters.
        Included in income taxes payable at December 31, 2006 and 2005 is
        approximately $.5 million associated with these matters. During the year
        ended
        December 31, 2004, the Company reversed $1.0 million of tax reserves
        established in certain prior years following the filing of amended income
        tax
        returns for those years and payment of the additional tax liabilities due
        thereon.




47


**NOTE
      11 - EMPLOYEE BENEFIT PLANS**




Effective
      with the Acquisition (see Note 2), LD Holdings’ employee stock ownership plan
      (“ESOP”) was terminated and all corresponding obligations were paid.




The
      Board
      of Directors determined its ESOP contribution annually. All transactions
      relative to the ESOP were funded by Lazy Days and, as a result, the ESOP
      obligations were recorded on the financial statements of Lazy Days. The ESOP
      borrowed funds from Lazy Days to purchase shares of Class A common stock
      from the former majority stockholder of Lazy Days on July 19, 1999. These
      shares were held by the ESOP in the ESOP trust’s suspense account and were
      allocated to individual ESOP participants as the loan was repaid. The loan
      obligation of the ESOP of $95,523,365 at December 31, 2003 was considered
      unearned employee ESOP shares and, as such, was recorded as a reduction of
      the
      Company’s stockholder’s equity. The Company’s contributions to the ESOP, plus
      any dividends paid on unallocated shares held by the ESOP, were used to repay
      the loan principal and interest. Both the loan obligation and the unearned
      ESOP
      shares were reduced by the amount of the loan principal repayments made by
      the
      ESOP. The ESOP compensation expense totaled $534,000 for the year ended
      December 31, 2004. The compensation expense was computed based upon the
      fair value of the ESOP shares committed to be released to participants for
      the
      relevant year. The number of ESOP shares committed to be released to
      participants totaled 46,883 shares for the year ended December 31, 2004.




Effective
      January 1, 2003, the Company established a profit sharing plan with 401(k)
      provisions (the “Plan”). The Plan covers substantially all employees. The Plan
      allows employee contributions to be made on a salary reduction basis under
      Section 401(k) of the Internal Revenue Code. Under the 401(k) provision,
      the Company makes discretionary matching contributions equal to 50% of the
      employees’ contribution not to exceed 4% of employee pre-tax deferrals. Expense
      under the Plan for the years ended December 31, 2006, 2005 and 2004 was
      approximately $537,000, $523,000 and $473,000 respectively.




**NOTE
      12 - COMMITMENTS AND CONTINGENCIES**




The
      Company purchases and sells new vehicles under various consignment arrangements,
      including one with a related party. During the term of this arrangement, which
      commenced on December 29, 2001, the Company has purchased virtually all
      inventory that has been held under consignment. The total consigned inventory,
      which is not included in the Company’s balance sheets, approximated $14.3
      million and $17.4 million at December 31, 2006 and 2005, respectively.
      Total inventory purchased by the Company under this consignment arrangement
      totaled approximately $107 million, $143 million and $141 million for the years
      ended December 31, 2006, 2005 and 2004, respectively. This consignment
      arrangement, as amended October 12, 2006, requires the Company to begin paying
      consideration for the consignment of such units.  Required payments begin
      in October 2007 and are based on U.S. Treasury rates times the average value
      of
      units on hand, as defined.




Employment
      agreements exist between the Company and its two senior officers which expire
      five years from the date of the Acquisition. The agreements may continue on
      terms mutually agreeable to the parties. The agreements detail various matters
      including but not limited to base compensation and bonus compensation.




In
      addition,
      concurrent with the Acquisition, the Company entered into a non-competition
      agreement with its past Chairman of the Board and a shareholder of LD Holdings,
      whereby the past Chairman agreed not to engage in any business competing with
      the businesses of the Company for a period of five years following the
      Acquisition, or if later, three years following termination of employment with
      the Company. In consideration thereof, the past Chairman will be paid $2 million
      per year so long as he continues to remain employed by the Company or serves
      as
      a member of the board of directors of the Company, LD Holdings or RV
      Acquisition, as defined.




The
      Company is a party to numerous legal proceedings that arise in the ordinary
      course of business. The Company has certain insurance coverage and rights of
      indemnification. The Company does not believe that the ultimate resolution
      of
      these matters will have a material adverse effect on the Company’s business,
      results of operations, financial condition, or cash flows. However, the results
      of these matters cannot be predicted with certainty and an unfavorable
      resolution of one or more of these matters could have a material adverse effect
      on the Company’s business, results of operations, financial condition, and/or
      cash flows.




48


**NOTE
      13 - DEFERRED COMPENSATION**




Effective
      with the Acquisition, the Company’s obligations under its Phantom Stock Plan and
      Supplemental Phantom Stock Plan were paid in full.




The
      Company’s Phantom Stock Plan benefits vested to participants over a 60-month
      period from the termination date or in the event of the death or disability,
      provided that the participant was actively employed by the Company on the day
      prior to that event, or upon the 65 th birthday
      of a participant, provided that such was employed by the Company at least ten
      years. The plan was terminated on August 6, 2002 and the value of all
      accrued and future benefits there under, as calculated based on a formula
      described in the plan as of December 31, 2001, were to be paid to
      participants over a specified time and subject to certain conditions. Payments
      made relative to the liquidation of the plan totaled approximately $705,000
      in
      2004.




The
      Company’s Supplemental Phantom Stock Plan was to be paid after the Class A
      Preferred shares are redeemed. The Company was required to deposit five percent
      of this total liability in a separate restricted cash account every quarter
      for
      20 quarters, and all interest earned in this separate account is to be remitted
      to the beneficiaries of the plan upon payout of the plan benefit. The plan
      was
      also terminated on August 6, 2002. Payments made relative to the
      liquidation of the plan totaled approximately $2.2 million in 2004.




In
      2004,
      the Company recorded expense of approximately $1,088,000, related to these
      phantom stock plans.





49


**NOTE
      14 - LD HOLDINGS AND RV ACQUISITION**




The
      balance sheets of LD Holdings, a wholly owned subsidiary of RV Acquisition,
      consisted of the following at December 31, 2006 and 2005:




**2006**
            
            **2005**ASSETSInvestment
                in and equity in earnings of Lazy Days
            
            $
            73,665,492
            
            $
            71,497,020STOCKHOLDER'S
                EQUITYCommon
                stock, Class A
            
            $
            1
            
            $
            1Paid-in
                capital
            
            
            67,000,000
            
            
            67,000,000Retained
                earnings
            
            
            6,665,491
            
            
            4,497,019Total
                stockholder's equity
            
            $
            73,665,492
            
            $
            71,497,020




The
      balance sheets of RV Acquisition consisted of the following at December 31,
      2006 and 2005:




**2006**
            
            **2005**ASSETSInvestment
                in and equity in earnings of LD Holdings
            
            $
            73,665,492
            
            $
            71,497,020LIABILITIESDue
                to Lazydays
            
            $
            51,372
            
            $
            3⁄4STOCKHOLDERS’
                EQUITYPreferred
                stock, Series A, including accrued dividends of $26,547,610 in 2006
                and
                $15,340,912 in 2005
            
            $
            88,547,610
            
            $
            77,340,912Common
                stock, $.01 par value
            
            
            49,947
            
            
            50,000Paid-in
                capital
            
            
            4,941,771
            
            
            4,950,000Accumulated
                deficit
            
            
            (19,925,208
            )
            
            (10,843,892
            )Total
                stockholders' equity
            
            
            73,614,120
            
            
            71,497,020Total
                liabilities and stockholders' equity
            
            $
            73,665,492
            
            $
            71,497,020




The
      Series A Preferred stock of RV Acquisition accrues dividends at a rate of
      14% per annum, compounded semi-annually. Dividends on the Series A
      Preferred Stock are not required to be paid in cash and accrue whether or not
      declared and whether or not there are profits, surplus or other funds legally
      available for payment of the dividend. Accrued and unpaid dividends on the
      Series A Preferred Stock aggregated $26,547,610 at December 31, 2006 and
      $15,340,912 at December 31, 2005. Upon a sale of RVAcquisition, the holders
      of
      Series A Preferred Stock have the right to request RV Acquisition to redeem
      their shares at a price equal to the initial purchase price plus any accrued
      and
      unpaid dividends thereon. Similarly, BRS (as holder of the majority of the
      Series A Preferred Stock) has the right, upon certain change of control
      transactions, to have such transactions treated as a liquidation event, as
      a
      result of which all shares of Series A Preferred Stock will be redeemed at
      a
      price equal to the initial purchase price plus any accrued and unpaid dividends
      thereon.




Effective
      August 20, 2004, RV Acquisition established a nonqualified stock option
      plan (the “Plan”) for certain of its directors, officers, consultants and
      employees. The Plan is administered by the Board of Directors or a committee
      designated by the Board. The Board of Directors may grant options and establish
      the option term, vesting period and exercise price. The maximum number of shares
      to which options may be granted shall not exceed 768,301 and expire no later
      than ten years from the date of grant. In August 2004, the Board of Directors
      granted an aggregate of 363,636 stock options to three key employees at an
      exercise price of $1 per share, and an additional 20,000 stock options were
      granted to a key employee at an exercise price of $1 per share in November
      2004.
      In December 2006, the Board of Directors granted an additional 243,360 stock
      options to a key employee at an exercise price of $1 per share. One-third of
      the
      option grant is subject to time vesting and becomes exercisable in five equal
      installments on the anniversary of the grant. One-third of the option grant
      vests upon BRS reaching an IRR of 25% and one-third vests upon BRS reaching
      an
      IRR of 30%.




50


Effective
      January 1, 2006, RV Acquisition adopted SFAS No. 123R (revised 2004),
      "Share-Based Payment" as interpreted by SEC Staff Accounting Bulletin No.
      107.  SFAS No. 123R supersedes Accounting Principles Board ("APB") Opinion
      No. 25, "Accounting for Stock Issued to Employees," and amends SFAS No. 95,
      "Statement of Cash Flows." Generally, the approach in SFAS
      No.
      123R is similar to the approach described in SFAS No. 123, "Accounting for
      Stock-Based Compensation."  However, SFAS No. 123R requires all stock-based
      payments to employees, including grants of employee stock options, to be
      recognized in the income statement based on their fair values at the date of
      grant.  Compensation expense for the year ended December 31, 2006 was
      insignificant.





Prior
      to
      January 1, 2006, the Company accounted for its stock options under the
      recognition and measurement principles of APB Opinion No. 25, and related
      interpretations.  Accordingly, no stock-based employee compensation cost
      was reflected in net earnings prior to January 1, 2006 as all options to
      purchase common stock of the Company had an exercise price equal to, or greater
      than, the market value of the underlying common stock on the date of
      grant.  Pro forma net income for the years ended December 31, 2005 and
      2004, computed
      under the minimum value method of SFAS No. 123, would not have differed
      significantly from its reported net income.




**Financial
      Statement Schedule**




**LAZY
      DAYS’ R.V. CENTER, INC.**


**Schedule
      II: Valuation and Qualifying Accounts**




**Column
                A**
              **Description**
            
            **Column
                B**
              **Balance
                at**
              **Beginning
                of**
              **Period**
            
            **Column
                C**
              **Additions**
              **Charged
                to**
              **Costs**
              **and
                Expenses**
            
            **Column
                D**
              **Deductions**
            
            **Column
                E**
              **Balance
                at**
              **End
                of**
              **Period****Year
                ended December 31, 2006:**Reserves
                and allowances deducted from assetaccounts:Allowance
                for doubtful receivables
            
            $
            279,557
            
            $
            297,484
            
            $
            27,734
            
            $
            549,307Reserves
                which support the balance sheet caption,reserves:Reserve
                for charge-backs
            
            $
            2,085,000
            
            
            2,353,000
            
            
            2,286,000
            
            
            2,152,000**Year
                ended December 31, 2005:**Reserves
                and allowances deducted from asset accounts:Allowance
                for doubtful receivables
            
            $
            437,846
            
            $
            56,298
            
            $
            214,587
            
            $
            279,557Reserves
                which support the balance sheet caption,reserves:Reserve
                for charge-backs
            
            $
            2,034,000
            
            $
            2,539,000
            
            $
            2,488,000
            
            $
            2,085,000**Year
                ended December 31, 2004:**Reserves
                and allowances deducted from assetaccounts:Allowance
                for doubtful receivables
            
            $
            321,834
            
            $
            205,865
            
            $
            89,853
            
            $
            437,846Reserves
                which support the balance sheet caption, reserves:Reserve
                for charge-backs
            
            $
            1,769,000
            
            $
            2,927,000
            
            $
            2,662,000
            
            $
            2,034,000




All
      other
      schedules for which provision is made in the applicable accounting regulations
      of the Commission are not required under the related instructions or are
      inapplicable and, therefore, have been omitted.




51


**ITEM 9.
      CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS
      ON ACCOUNTING AND FINANCIAL DISCLOSURE**




None.




**ITEM 9A.
      CONTROLS AND PROCEDURES**




a)
      **Conclusion Regarding the Effectiveness of Disclosure Controls and
      Procedures**


Our
      Principal Executive Officer, after evaluating the effectiveness of the Company's
      disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
      under the Securities Exchange Act of 1934) as of the end of the period covered
      by this annual report, has concluded that our disclosure controls and procedures
      are effective to ensure that information required to be disclosed by us in
      the
      reports that we file under the Securities Exchange Act of 1934 is recorded,
      processed, summarized and reported within the time periods specified in rules
      and forms of the SEC.  Such officer also confirms that there were no
      significant changes in our internal controls over financial reporting during
      the
      period covered by this report that have materially affected, or are reasonably
      likely to materially affect, our internal controls over financial
      reporting.




b)
      **Changes in Internal Control Over Financial Reporting**


There
      have been no changes in our internal control over
      financial reporting that occurred during the year ended December 31, 2006 that
      have materially affected, or are likely to materially affect, our internal
      controls over financial reporting.




**ITEM 9B.
      OTHER INFORMATION**




None.





52


**PART
      III**




**ITEM 10.
      DIRECTORS,
      EXECUTIVE OFFICERS AND CORPORATE
      GOVERNANCE**




The
      following table sets forth the names, ages and a brief account of the business
      experience of each person who is a director or executive officer of Lazydays
      as
      of the date hereof.




**Name**
            **Age**
            **Position**John
                Horton
            48
            Chief
                Executive Officer, DirectorStewart
                Schaffer
            55
            Chief
                of Marketing and CommunicationsPatrick
                Overby
            45
            General
                Manager, SalesSteve
                Ratcliff
            53
            Finance
                and Insurance ManagerBob
                Grady
            52
            Director
                of Service and PartsJoe
              Wiley
            44
            Chief
              Information OfficerLinda
                Stephens
            31
            Director
                of Corporate Reporting and Investor RelationsDon
                Wallace
            58
            ChairmanCharles
                Macaluso
            63
            DirectorThomas
                Baldwin
            48
            Director
                and Compensation Committee ChairmanStephen
                Sherrill
            54
            DirectorMichael
                Salvati
            54
            Director
                and Audit Committee ChairmanThomas
                Donnelly
            50
            DirectorThomas
                Millner
            53
            Director




*John
      Horton* began
      working with us in 2001 as Chief Operating Officer. In August 2005, he was
      appointed Chief Executive Officer. In his current capacity Mr. Horton
      oversees the ongoing operations and develops future plans for the Company.
      From
      2000 to 2001, Mr. Horton served as Executive Vice President of Aavid
      Thermalloy, a manufacturer of thermal management products. From 1996 to 2000,
      Mr. Horton held positions as CEO and CFO of IPM Service Corporation, a
      manufacturer of automotive aftermarket products. From 1980 to 1996, he held
      various financial and operations managerial positions at Zenith Electronics
      Corporation and Zenith Data Systems. Mr. Horton earned a BBA from the
      University of Michigan and an MBA from the University of Texas.





*Stewart
      Schaffer* joined
      us in 2000 and serves as our Chief Marketing and Communications Officer.
      Mr. Schaffer leads the Company’s efforts to maximize sales opportunities
      through promotions, membership programs, events, publications, the Lazydays
      website, rallies and other marketing activities. From 1987 to 2000,
      Mr. Schaffer served in executive marketing capacities for ClubCorp
      International, becoming Corporate Vice President of Marketing in 1994. Prior
      to
      that Mr. Schaffer held various senior marketing positions at American
      Express Company and International Paper Company. Mr. Schaffer earned a BS
      and an MBA from the Wharton School of the University of Pennsylvania.




*Patrick
      Overby* ,
      joined
      Lazydays in 1991and serves as our General Manager of Sales. Mr. Overby is
      responsible for all Sales operations including Sales production, inventory,
      training and recruitment and supplier relations. Prior to becoming General
      Manager of Sales, Mr. Overby held positions at Lazydays including:
      Sales Associate, Training and Recruiting Manager, Sales Desk Manager, Director
      of Financial Services, and Assistant General Manager of Sales. From 1979 to
      1991, Mr. Overby served in various sales/management positions with three
      other companies in the RV industry. Mr. Overby earned a MBA from Florida
      Technological University in Orlando, Florida.




*Steve
      Ratcliff* joined
      the Company in 1991 as the Finance and Insurance Manager. Prior to joining
      us,
      Mr. Ratcliff held the position of Regional Vice President with Canada and
      Associates, a company that sells financial products to dealerships.
      Mr. Ratcliff has previously managed the finance and insurance departments
      of several automotive dealerships. Mr. Ratcliff is responsible for
      maintaining our relationships with our lending partners and securing the best
      financing terms and insurance products for our customers. Mr. Ratcliff earned
      a
      BS in Finance from West Virginia University.





*Bob
      Grady* has been
      with Lazydays since 2002 in Service and Parts management roles. In 2004
      Mr. Grady was promoted to Director of Service and Parts where he is
      responsible for all of the Company’s service operations. Prior to Lazydays,
      Mr. Grady spent six years in the automotive parts aftermarket in
      operational and general management capacities, most recently with a supplier
      to
      Ford and General Motors. Before that, he held operational and financial
      management positions in the computer manufacturing industry. Mr. Grady
      holds a BS in Administration from the University of New Hampshire and an MBA
      from Bentley College. His areas of specialization include process improvement
      and materials management.


*Joseph
        Wiley* joined the company in 2005 as our Chief Information Officer. He
        continues in that role and also has responsibility for Property Management,
        Purchasing and Contracts and RallyPark. Mr. Wiley brings a breadth of operating
        leadership and functional experience to our Company, including Information
        Technology; Electrical Engineering, Contracting and Construction; Real Estate;
        Long Range Planning; Fleet Engineering and Operations; Purchasing and Contracts;
        Inventory Management; Facilities Management and Project Management. Mr. Wiley
        earned a BS degree in Electrical Engineering from the University of South
        Florida, an MBA from the University of Tampa, and is registered as a
        Professional Engineer in the State of Florida.


53




*Linda
      Stephens* joined
      the Company in 2004 as the Director of Corporate Reporting and Investor
      Relations. Mrs. Stephens is a Certified Public Accountant (CPA), as
      designated by the State of Florida and before joining us, served as a manager
      with a regional CPA firm. Mrs. Stephens is responsible for investor
      relations, corporate reporting, financial analysis and all accounting functions
      of the company. Mrs. Stephens holds a BS degree in Accounting from the
      University of South Florida.





*Don
      Wallace* ,
      along
      with his brother and father, founded the Company in 1976. Mr. Wallace is
      widely recognized throughout the RV industry as an innovator in RV retailing,
      having pioneered the super center concept. Mr. Wallace served as President
      and
      Chief Executive Officer until August 2005 at which time he was appointed
      Chairman of the Company as well as Chairman of the Board. On February 7, 2007,
      Mr. Wallace resigned as Chairman of the Board and announced his intent to retire
      as Chairman of the Company effective August 2, 2007.




*Charles
      Macaluso* is a
      founding principal of Dorchester Capital Advisors (formerly East Ridge
      Consulting, Inc.), a management consulting and corporate advisory firm founded
      in 1996. From March 1996 to June 1998, Mr. Macaluso was a partner at Miller
      Associates, Inc., a company principally involved in corporate workouts. From
      1989 to 1996, Mr. Macaluso was a partner at The Airlie Group, LLP, a fund
      specializing in leveraged buyout, mezzanine and equity investments. He is the
      Chairman of the Board for GEO Special Chemicals and serves as a member of the
      audit committee. He is also a director of Global Crossing, Inc., where he serves
      on the executive committee. He is lead Director and member of the compensation
      committee and nominating committee for Darling International and Board of
      Director member for ICG-Holliston Industries.





*Thomas
      Baldwin* joined
      BRS as a Managing Director in 2000. From 1988 to 1995, he served as Vice
      President and then Managing Director of The INVUS Group, Ltd., a private equity
      investment firm. Prior to that he was a consultant with the Boston Consulting
      Group, a strategy consulting firm. Mr. Baldwin received a BBA from Siena
      College and his MBA from Harvard Business School. Mr. Baldwin is a director
      of Totes Isotoner Corporation, Eurofresh, Inc. and The Sheridan Group, Inc.




*Stephen
      Sherrill* is a
      founder and Managing Director of BRS. Previously, he was an officer of Citicorp
      Venture Capital, or CVC, from 1983 through 1994. Prior to joining CVC, he was
      an
      associate at the New York law firm of Paul, Weiss, Rifkind, Wharton &
Garrison LLP He earned his BA at Yale University and his JD at Columbia Law
      School. Mr. Sherrill is a director of Airxcel Holdings, Inc., B&G
      Foods, Inc. and Remington Arms Company, Inc.




*Michael
      Salvati* has over
      25 years of financial and business experience. He has been a principal at
      Oakridge Consulting since 2000, where he provides financial consulting and
      interim management services for various companies. During this time,
      Mr. Salvati has served as the Chief Financial Officer of several companies.
      These assignments have included public filers such as AMIS Holdings, Inc.,
      a designer and manufacturer of semiconductor products through its subsidiary,
      AMI Semiconductor, Inc., Global Exchange Services, and marchFirst. Prior to
      founding Oakridge Consulting, Mr. Salvati served as Chief Operating Officer
      at National Financial Partners from 1998 to 2000 and Chief Financial Officer
      of
      Culligan Water Technologies, Inc. from 1996 to 1998. Mr. Salvati was
      previously a partner at KPMG LLP. Mr. Salvati holds both a B.S. in
      Microbiology and M.S. in Accounting from the University of Illinois in
      Champaign-Urbana.





*Thomas
      Donnelly* is
      currently a partner with Landmark Partners, specializing in financial services,
      Kentucky Outdoor Advertising and Hard Ten Group. In 1971 Mr. Donnelly
      joined Camping World, Inc. where he served as Chief Executive Officer from
      1986
      until 2002. Camping World is the world’s largest retailer of RV accessories,
      supplies and services. Mr. Donnelly is also a Director of Branch
      Bank & Trust (BB&T) and Girls, Inc. both of Bowling Green,
      Kentucky.




*Thomas
      Millner* is
      currently the President and Chief Executive Officer of Remington Arms Company,
      Inc. He also served as the company’s President, Chief Executive Officer, and
      Director from 1994 until 1999. In 1987 Mr. Millner joined Pilliod Cabinet
      Company, a leading producer of opening price point bedroom wall systems, and
      living room tables. In 1990 he was named Chief Executive Officer where he served
      until Pilliod was sold to LADD Furniture in 1994. From 1976 until 1987
      Mr. Millner held various sales and management positions with Broyhill and
      Thomasville Furniture Industries. Mr. Millner holds a BA with Honors from
      Randolph Macon
      College where he was admitted into Phi Beta Kappa. Mr. Millner is a
      Director of Stanley Furniture (NASDAQ:STLY) and serves as Chairman of the Audit
      Committee. Mr. Millner is also a director of Remington Arms Company,
      Inc.




54


**ITEM
      11: EXECUTIVE
      COMPENSATION**






*The
      following discussion and analysis contains statements regarding future company
      performance targets and goals. These targets and goals are disclosed in the
      limited context of our compensation programs and should not be understood to
      be
      statements of management’s expectations or estimates of results or other
      guidance. We specifically caution readers of these statements not to apply
      these
      statements to other contexts.*





**Background
      and Overview**




In
      this
      section, we provide certain aspects of our compensation program as it pertains
      to our Chairman, Chief Executive Officer, Chief Financial Officer, and our
      two
      other most highly compensated officers in 2006. We refer to these five people
      throughout as the “Named Executive Officers” or “NEOs”. Our discussion focuses
      on compensation and practices related to our most recently completed fiscal
      year.





We
      believe that the performance of each of the named executive officers has the
      potential to impact both our short-term and long-term profitability. Therefore,
      we place considerable importance on the design and administration of the
      executive compensation program.




**Compensation
      Committee (“Committee”) Structure**





The
      Compensation Committee is comprised of non-management directors. No
      member
      of the Compensation Committee was an officer or employee of LD Holdings or
      any
      of its subsidiaries during the fiscal year ended December 31, 2006. No
      member was formerly an officer of LD Holdings or of its subsidiaries. In
      addition, no executive officer of the Company serves on the board of directors
      or the compensation committee of another entity where a committee member is
      employed. Mr. Baldwin, Director and Chairman of the Compensation Committee,
      is a Managing Director of BRS, which owns approximately 84% of the common stock
      of RV Acquisition.





The
      Committee has responsibility for oversight and review of our total compensation
      strategy taking into consideration existing company-wide benefit plans. The
      Board of Directors has responsibility for the approval of any stock option
      grants.





The
      compensation for three of the Named Executive Officers was established through
      employment agreements that were negotiated as part of the acquisition of LD
      Holdings. As needed, the Compensation Committee reviews and approves any
      modifications to these three employment contracts.





Pat
      Overby (Sales Manager) and Steve Ratcliff (Finance & Insurance Manager) do
      not have employment agreements. The majority of their compensation is cash
      compensation, 100% of which is commission based on achieving sales targets,
      profit targets and other performance related targets. These targets are
      established by the Chief Executive Officer during the annual budgeting process
      and approved through the budget review by the Board of Directors. This approach
      has been taken because the majority of the effort of these individuals is
      short-term in nature (i.e. sales focus) rather than long-term (strategic focus).
      This approach allows us to be competitive with the compensation structure of
      the
      marketplace.





The
      Committee did not engage an outside compensation and benefits consultant during
      fiscal 2006.





**Executive
      Compensation Philosophy**





The
      objectives of our executive compensation program are to provide our executives
      with a compensation package that supports our goals, is competitive and provides
      executives with rewards equal to their contribution to the Company’s success. In
      some cases, compensation was established as part of the negotiated acquisition
      of the Company by RV Acquisition. In all other situations, executive
      compensation decisions are driven by a pay for performance philosophy. The
      goal
      is to provide a compensation package that is comparable to the marketplace
      and
      provide compensation that is commensurate with the executive’s contribution to
      the Company’s financial performance. Compensation structure is designed to
      provide a significant portion of total compensation through variable
      compensation.





55


**Objectives
      of Executive Compensation** ***-*** The
      objectives of our executive compensation program are to:





1.
            attract
                and retain quality executive
                leadership,


2.
            increase
                shareholder value,


3.
            improve
                our overall performance,


4.
            enhance
                the individual executive’s performance,
                and


5.
            align
                incentives with the business unit and company areas most directly
                impacted
                by the executive’s leadership and
                performance.





The
      Committee strives to meet these objectives while maintaining market competitive
      compensation. The Committee attempts to make compensation decisions consistent with the foregoing
      objectives and considerations including, in particular, market levels of
      compensation it believes are necessary to attract, retain, and motivate our
      executive officers. Therefore, the Committee does not take into account an
      individual’s net worth or the aggregate wealth accumulated or realizable by the
      individual from past compensation grants.




**Role
      of Executive Officers in Determining Executive
      Compensation**





** The
      Committee oversees the administration of executive compensation plans, including
      the design, performance measures, and award opportunities for the executive
      incentive programs, and certain employee benefits. The Committee has the
      authority to determine, and recommend for Board of Directors approval, all
      compensation and awards to the Chairman, Chief Executive Officer and Chief
      Financial Officer.





**Decisions
      Regarding Composition of Total Compensation**





We
      provide a competitive mix of pay elements that align executive incentives with
      shareholder value. The primary components of the executive compensation program
      are:





·
            Base
                salary,


·
            Annual
                cash incentives,


·
            Long-term
                incentives,


·
            Benefits,
                and


·
            Severance
                benefits




A
      brief
      description of these components and related programs follows.





**Base
      Salary** - Base
      salary is designed to provide competitive levels of compensation to executives
      based upon their experience, duties and scope of responsibility. We pay base
      salaries to provide a basic level of compensation in order to recruit and retain
      executives.





Effective
      January 1, 2006, the base salary for John Horton was increased from $500,000
      to
      $600,000. This increase was made in order to reflect his promotion to Chief
      Executive Officer. For a discussion of the Named Executive Officers’ employment
      arrangements, please see the narrative accompanying the Summary Compensation
      Table.




****   **Annual
      Cash Incentives (“Bonus”)** - We
      use
      our Annual Cash Incentives as a short-term incentive to drive achievement of
      our
      annual performance goals. The goal is to focus on the achievement of annual
      financial goals and provide cash awards relative to performance. Annual Cash
      Incentives are designed to:




·
            Support
                our strategic business objectives,


·
            Promote
                the attainment of specific financial
                goals,


·
            Reward
                achievement of specific performance
                objectives.





The
      Annual Cash Incentive is paid based on the actual EBITDA performance relative
      to
      the budgeted EBITDA. EBITDA is net income from operations increased by the
      sum
      of interest expense, income taxes, depreciation, amortization and other non-cash
      items, as defined.





The
      Board
      of Directors sets the targeted EBITDA level through its review and approval
      of
      the annual budget. In determining final awards and in evaluating personal
      performance, the Board considers adjusting EBITDA and other corporate
      performance measures for unplanned, unusual or non-recurring items of gain
      or
      expense. In 2006, the Board exercised its discretion by adding to reported
      EBITDA the amount of non-compete payments made to Don Wallace and management
      fees paid to BRS and Mr. Wallace.





As
      discussed above, 100% of the cash compensation for the Sales Manager and Finance
      & Insurance Manager is commission based. Annual Cash Incentives for the
      Chief Executive Officer and Chief Financial Officer are based on their
      employment agreements that were negotiated in conjunction with the acquisition
      of Lazy Days. Based on his employment agreement, the Chairman is not eligible
      for an Annual Cash Incentive.





56


The
      Chief
      Executive Officer is eligible to receive a bonus of $200,000 upon achieving
      85%
      of the targeted EBITDA each year. The bonus increases to up to $400,000 upon
      achieving 115% of the targeted EBITDA. If the EBITDA falls between 85% and
      115%
      of the targeted EBITDA, a pro-rata payment is made. If performance falls below
      85% of the targeted EBITDA level, no bonus is paid. The EBITDA as measured
      for
      the Annual Cash Incentive was less than 85% of budget for the 12 months ended
      December 31, 2006. Since performance was below 85%, no Annual Cash Incentive
      was
      paid to Mr. Horton.





The
      Chief
      Financial Officer is eligible to receive 40% of his base salary upon achieving
      85% of the targeted EBITDA each year. The bonus increases up to 80% of base
      salary upon achieving 115% of the targeted EBITDA. If
      the
      EBITDA falls between 85% and 115% of the targeted EBITDA, a pro rata payment
      is
      made. If performance falls below 85% of the targeted EBITDA level, no bonus
      is
      paid. The EBITDA as measured for the Annual Cash Incentive was 85.5% of budget
      for the nine months ended September 30, 2006. Mr. Thibault was paid a bonus
      equal to 40.7% of his base compensation for the nine month period. He retired
      on
      October 2, 2006.





**Long-term
      Incentive Plans** **-** Our
      compensation structure also includes **** long-term
      variable compensation at the senior executive levels because of our desire
      to
      reward effective long-term management decision making. Long-term incentives
      are
      designed to focus attention on long-range objectives and future returns to
      shareholders. Long-term Incentive Plans utilized by the Company
      include:





*Stock
      Option Awards* In
      connection with the purchase of LD Holdings by RV Acquisition, RV Acquisition
      stock option grants were issued by RV Acquisition to our three most senior
      executives who would have the largest impact on the Company’s long-term
      performance. Stock option grants are made at the discretion of the Compensation
      Committee and Board of Directors pursuant to the 2004 Stock Plan as amended,
      which is administered by the Committee and approved by the Board of
      Directors.





We
      grant
      only nonqualified stock options. These awards are used to: (1) create a
      fundamental, long-term linkage between the interests of executives and
      shareholders, and (2) recruit and retain executive talent.




Stock
      options represent 100 % of long-term incentive compensation for our Chairman,
      Chief Executive Officer and Chief Financial Officer. On August 20, 2004 initial
      grants of 121,212 shares were made to Mr. Wallace, Mr. Horton and Mr. Thibault.
      The options are subject to time vesting in five equal installments on the
      anniversary date of the grant. The options expire after 10 years. The options
      have an exercise price of $1.00.





On
      December 28, 2006, an additional grant of 243,360 shares was made to Mr. Horton
      as a result of his additional responsibilities as Chief Executive Officer.
      This
      grant expires after 10 years. One-third of the option grant is subject to time
      vesting and becomes exercisable in five equal installments on the anniversary
      of
      the grant. One-third of the option grant vests upon BRS reaching an IRR of
      25%
      and one-third vests upon BRS reaching an IRR of 30%. All options have an
      exercise price equal to $1.00. Accordingly, the actual value an executive will
      realize is tied to future stock price appreciation and is therefore aligned
      with
      corporate performance and shareholder stock price returns.





*Long-term
      Incentive Plan* ** Our
      General Sales Manager and Finance & Insurance Manager participate in the
      Long-term Incentive Plan of RV Acquisition. Under the terms of the plan,
      participants would share pro-rata (based on salary) in a pool equal to
      approximately 7.5% of the total common equity value of RV Acquisition upon
      occurrence of a Trigger Event as defined in the plan. A Trigger Event means
      the
      sale of RV Acquisition (whether by sale of a majority of its stock or a sale
      of
      all or substantially all of its assets, including the sale of Lazy Days RV
      Center, Inc.) or a public offering of RV Acquisition’s common stock resulting in
      gross proceeds to RV Acquisition and selling stockholders of $60 million (unless
      the Board determines that no “change of control” has occurred within the meaning
      of the tax law). If the payment date occurs due to a public offering described
      above, the payments due under the plan may be made in shares of RV Acquisition’s
      common stock.





**Benefits** **-** The
      Company provides the following benefits:


·
            *401(k)
                Plan**-*We
                offer a qualified 401(k) Plan. We make matching contributions to
                the
                401(k) Plan to encourage employees to save money for their retirement.
                These plans, and our contributions to them, enhance the range of
                benefits
                we offer to executives and enhance our ability to attract and retain
                employees. Under the terms of the qualified 401(k) Plan, employees
                may
                defer from1%to
                a maximum of $15,500 or $20,500 if over 50 of their eligible pay.
                The
                Company makes discretionary matching contributions equal to 50% of
                the
                employee contribution not to exceed 4% of employee pre-tax deferrals.
                In
                2006, Company matching contributions were approximately $21,000 for
                the
                NEOs.





**·**
            *Perquisites
                and Other Benefits**-*Perquisites and other benefits represent a small part of our overall
                compensation package. Perquisites for Mr. Wallace, Mr. Thibault and
                Mr.
                Horton were established by their employment contracts. The primary
                perquisites for Mr. Wallace, Mr. Horton and Mr. Thibault are payment
                of
                health insurance, company paid life and disability insurance payments,
                and
                cash payments to cover the tax liability to the executives for the
                imputed
                value of such benefits. Certain tax, accounting, and other regulations
                often subject our executives to taxation on the receipt of certain
                benefits irrespective of the value such benefit conferred to the
                executive. In these situations, we typically provide a tax gross-up
                payment to the executive to reimburse the executive for approximate
                amounts of additional tax liability the executive will need to pay
                as a
                result of receiving such benefits. In addition to these perquisites,
                Mr.
                Horton may be reimbursed for tuition to attend up to one short-term
                management program per year. He may also be reimbursed up to $150,000
                for
                relocation expenses.





57


**Other
      Guidelines and Procedures Affecting Executive Compensation**




***Stock-Based
      Compensation*** **-** Policies
      related to Stock-Based Compensation include the following:




·
            **Procedures
                Regarding Committee Approval and Delegation of Authority
                -**The
                Committee and Board of Directors approve all grants of stock-based
                compensation.


·
            **Procedures
                Regarding Timing and Pricing of Awards***-*Our policy is to not grant “in-the-money” options or options with exercise
                prices below market value on the date of grant.





Compensation
      for Mr. Overby and Mr. Ratcliff is established by Mr. Horton and approved by
      the
      Board of Directors through approval of the annual budget.





**Summary**


In
      summary, we believe this mix of salary, potentially significant variable cash
      incentives and the potential for equity ownership in RV Acquisition motivates
      our management team to produce strong returns for shareholders. We further
      believe this program strikes an appropriate balance between the interests and
      needs of Lazy Days in operating our business and appropriate employee rewards
      based on shareholder value creation.




**Report
      of the Compensation Committee on the Compensation Discussion and
      Analysis**


The
      Compensation Committee reviewed and discussed the Compensation Discussion and
      Analysis included in this Annual Report on Form 10-K with management. Based
      on
      such review and discussion, the Compensation Committee recommended to the Board
      of Directors that the Compensation Discussion and Analysis be included in this
      Annual Report on Form 10-K for filing with the Securities and Exchange
      Commission.




Submitted
      by the Compensation Committee of Lazy Days’ R.V. Center Inc.’s Board of
      Directors.




Thomas
      Baldwin, Director and Chairman of the Compensation Committee


Thomas
      Millner, Director


Thomas
      Donnelly ,
      Director





**Summary
      of Cash and Certain Other Compensation and Other Payments to the Named Executive
      Officers**




***Overview
      -*** **** The
      following sections provide a summary of cash and certain other amounts we paid
      for the year ended December 31, 2006 to the named executive officers.
      Except where noted, the information in the Summary Compensation Table generally
      pertains to compensation to the named executive officers for the year ended
      D ecember 31,
      2006. The compensation we disclose below is presented in accordance with SEC
      regulations. According to those regulations we are required in some cases to
      include:




·
            amounts
                paid in previous years,


·
            amounts
                that may be paid in future years, including amounts that will be
                paid only
                upon the occurrence of certain events, such


as
      an
      involuntary termination,


·
            amounts
                we paid to the named executive officers which might not be considered
                “compensation” (for example, non-compete


payments)


·
            an
                assumed value for share-based compensation equal to the fair value
                of the
                grant as presumed under accounting


regulations,
      even though such value presumes the option will not be forfeited or exercised
      before the end of its 10-year life,


and
      even
      though the actual realization of cash from the award depends on whether our
      stock price appreciates above its price


on
      the
      date of grant, whether the executive will continue his employment with us,
      and
      when the executive chooses to exercise


the
      option.




Therefore,
      we encourage you to read the following tables closely. The narratives preceding
      the tables and the footnotes accompanying each table are important parts of
      each
      table. Also, we encourage you to read this section in conjunction with the
      Compensation Discussion and Analysis, above.




58


**2006
      Summary Compensation Tables**




The
      following table provides information concerning the compensation of the named
      executive officers for our most recently completed fiscal year.




In
      the
      column “Salary”, we disclose the amount of base salary paid to the named
      executive officer during the fiscal year. In the column “Bonus”, we disclose the
      annual performance bonus that is paid to Named Executive Officers. The column
      “Option Awards” reflects the dollar amount of stock-based compensation
      recognized for 2006 financial statement reporting purposes in accordance with
      FAS 123R. The amounts relate to stock option awards granted to the named
      executive under the Amended RV Acquisition, Inc. 2004 Stock Option Plan as
      amended. For stock options, the FAS 123(R)fair value per share is based on
      certain assumptions which we explain in footnote 14 to our financial
      statements which is included in our annual report on Form 10-K. The amounts
      shown in the 2006 Summary Compensation Table also include a ratable portion
      of
      each grant we made in prior years to the extent the vesting period fell in
      2006.
      Please also refer to the second table, “2006 Grants of Plan-Based Awards” for
      new grants made during 2006.




In
      the
      column “All Other Compensation,” we disclose the sum of the dollar value of:





·
            perquisites
                and other personal benefits, unless the aggregate amount of such
                compensation is less than $10,000;


·
            all
                “gross-ups” or other amounts reimbursed during the fiscal year for the
                payment of taxes;


·
            any
                commission payments


·
            amounts
                we paid or which became due related to non-compete payments, termination,
                or severance, if any;


·
            any
                health, life or disability insurance premiums we paid during the
                year for
                the benefit of a Named Executive
                Officer.





**Summary
      Compensation Table**




**Name
                and Principal Position**
            
            **Year**
            
            **Salary
                ($)**
            
            **Bonus
                ($)**
            
            **Option
                Awards ($) (5) (6)**
            
            **All
                Other Compensation ($)****(7)**
            
            **Total
                ($)****Don
                Wallace****(1)**
            
            
            2006
            
            $
            1,060,008
            
            $
            3⁄4
            
            
            3⁄4
            
            $
            2,089,009
            
            $
            3,140,017**John
                Horton****(4)**
            
            
            2006
            
            $
            613,588
            
            $
            3⁄4
            
            
            3⁄4
            
            $
            36,806
            
            $
            650,394**Chuck
                Thibault****(2)
                (3)**
            
            
            2006
            
            $
            474,030
            
            $
            193,308
            
            
            3⁄4
            
            $
            35,855
            
            $
            703,193**Patrick
                Overby**
            
            
            2006
            
            $
            3⁄4
            
            $
            3⁄4
            
            
            3⁄4
            
            $
            392,980
            
            $
            392,980**Steve
                Ratcliff**
            
            
            2006
            
            $
            3⁄4
            
            $
            3⁄4
            
            
            3⁄4
            
            $
            295,390
            
            $
            295,390




59


1)
            During
                fiscal 2006, Mr. Wallace served as Chairman of the Board and Chairman
                of the Company. On February 7, 2007, he announced that he would retire
                as
                Chairman of the Company, effective August 2, 2007. He also resigned
                as
                Chairman of theBoard
                effective February 7, 2007.


2)
            Mr.
                Thibault retired effective October 2, 2006. Subsequent to his retirement,
                Mr. Thibault provides services under a consulting agreement which
                pays him
                $2,500 per day for consulting services required by the Company. In
                2006,
                Mr. Thibault was paid $5,000 for consulting services.


3)
            In
                fiscal 2006, Mr. Thibault was paid a bonus of $193,308. Mr. Thibault
                retired effective October 2, 2006. The bonus reflects a pro rata
                payment
                for the nine month period ending September 30, 2006. During that
                period,
                the Company had attained 85.5% of the targeted EBITDA that had been
                established for paying the Annual Cash
                Incentive.


4)
            For
                all of fiscal 2006, the Company did not achieve 85% of its targeted
                EBITDA. As a result, Mr. Horton was not paid an Annual Cash Incentive
                bonus for 2006.


5)
            As
                a part of their employment agreements, Mr. Wallace, Mr. Horton and
                Mr.
                Thibault received stock option grants. These options have a 10 year
                term
                and vest in five equal installments on the anniversary date of the
                grant.
                The shares have an exercise price of $1.00 per share. All three were
                awarded 121,212shares.
                Subsequent to his retirement on October 2, 2006, Mr. Thibault’s shares
                were returned to the option pool.


6)
            Mr.
                Horton was awarded a second grant of 243,360 shares on December 28,
                2006.
                One-third of these shares vest ratably over five years on the anniversary
                date of the grant. One-third will vest upon achieving a financial
                return
                for BRS of 25%. One-third will vest upon achieving a financial return
                for
                BRS of 30%. These options have a 10 year term and an exercise price
                of
                $1.00


7)
            Other
                Compensation is comprised of the following
                components:




**Name**
            
            **Medical
                Insurance**
            
            **Life
                & Disability Insurance****(A)**
            
            **401(k)
                Match****(B)**
            
            **Tax
                Gross-ups****(C)**
            
            **Other****(D)**
            
            **Total****Don
                Wallace**
            
            $
            9,772
            
            $
            8,494
            
            $
            4,200
            
            $
            3,578
            
            $
            2,062,965
            
            $
            2,089,009**John
                Horton**
            
            $
            15,941
            
            $
            10,591
            
            $
            4,200
            
            $
            6,074
            
            $
            3⁄4
            
            $
            36,806**Chuck
                Thibault**
            
            $
            15,679
            
            $
            9,483
            
            $
            4,200
            
            $
            6,493
            
            $
            3⁄4
            
            $
            35,855**Patrick
                Overby**
            
            $
            3,853
            
            $
            3⁄4
            
            $
            4,200
            
            $
            3⁄4
            
            $
            384,927
            
            $
            392,980**Steve
                Ratcliff**
            
            $
            3,853
            
            $
            3⁄4
            
            $
            4,200
            
            $
            3⁄4
            
            $
            287,337
            
            $
            295,390





(A)
            The
                company reimburses Mr. Wallace, Mr. Horton and Mr. Thibault for the
                cost
                of life insurance and disability insurance. These payments are grossed
                up
                for tax payments.


(B)
            The
                amount shown includes our matching contributions to the 401(k)
                Plan.


(C)
            Mr. Wallace’s
                gross-ups include $3,578 for life and disability payments, Mr. Horton’s
                gross-ups include $6,074 for life and disability payments.
                Mr. Thibault’s gross-ups include $6,493 for life and disability
                payments.


(D)
            The
                amount shown for Mr. Wallace’s Other includes $2,000,000 for
                non-compete payments and $62,965 for annual management fee.****The
                amount for Mr. Overby and Mr. Ratcliff are for commissions
                earned.





**Employment
      Agreements and Other Compensation Plans**





Three
      of
      our Named Executive Officers have employment agreements. Don Wallace, John
      Horton and Chuck Thibault. Pat Overby and Steve Ratcliff have compensation
      plans
      that define the financial targets for the year as well as their compensation
      for
      achieving each target.





***Other
      Compensation Plans***




One
      hundred percent (100%) of the cash compensation for Messrs. Overby and Ratcliff
      is based on commissions. As is customary for these positions, the vast majority
      of compensation is based on cash incentives rather than long-term equity
      incentives. This approach has been taken because of the majority of the effort
      of these individuals is short-term in nature (i.e. sales focus) rather than
      long-term (strategic focus). This approach allows us to be competitive with
      the
      compensation structure of the marketplace.





** The
      plan
      for Mr. Overby provides compensation based on the level of sales and
      profitability that is attained by the sales group. A portion of his compensation
      is also based on achieving defined delivery goals and inventory turnover
      goals. The
      plan
      for Mr. Ratcliff is based on the profitability of the Finance and Insurance
      Group.





60


***Employment
      Agreements*** *-* ******


On
      May
      14, 2004, our parent, LD Holdings was acquired by R.V. Acquisition. This
      transaction is described in Note 1 of our financial statements. Concurrent
      with
      the signing of the transaction documents, the Company and RV Acquisition entered
      into employment agreements with Don Wallace (President and Chief Executive
      Officer at the time of the acquisition), Chuck Thibault (Chief Financial Officer
      at the time of the acquisition), and John Horton (Chief Operating Officer at
      the
      time of the acquisition). On August 5, 2005, John Horton was named Chief
      Executive Officer and Don Wallace was named Chairman. On October 2, 2006, Chuck
      Thibault retired from the Company. On December 28, 2006, the Company amended
      Mr.
      Horton’s employment contract to increase his salary and stock options to reflect
      his new responsibilities as Chief Executive Officer. On February 7, 2007, Don
      Wallace announced that he will retire as Chairman of the Company effective
      August 2, 2007.




**2006
      Grants Of Plan-Based Awards**




In
      this
      table, we provide information concerning each stock option grant made to a
      Named
      Executive Officer in the most recently completed fiscal year. The stock option
      awards are granted under the RV Acquisition, Inc. 2004 Stock Plan, as amended.
      In the third and fourth columns, we report the number of shares of common stock
      underlying options granted in the fiscal year and corresponding per-share
      exercise prices. In the final column, we report the aggregate FAS 123(R)
      value of all awards made in 2006; in contrast to how we present amounts in
      the
      Summary Compensation Table, we report such figures here without apportioning
      such amount over the service or vesting period.





**Exercise****Number
                of**
            **Price
                of**
            **Grant
                Date****Equity**
            **Options**
            **Option**
            **Fair
                Value****Award**
            **Granted:**
            **Awards**
            **Of
                Option****Name**
            **Grant
                Date**
            
            **($/sh)**
            **Awards**John
                Horton(1)
            12/31/2006
            243,360
            
            $1.00
            
            $0.21





(1)
            On
                December 28, 2006, Mr. Horton was granted 243,360 shares under the
                RV
                Acquisition 2004 Stock Option Plan, as amended. The options have
                a 10 year
                term. One-third of these shares vest ratably over 5 years on the
                anniversary date of the grant. One-third will vest upon BRS achieving
                a
                financial return of 25%. One-third will vest upon BRS achieving a
                financial return of 30%.




61


**Outstanding
      Equity Awards At Fiscal Year-End 2006**




The
      following table provides information concerning unexercised options and stock
      that has not vested for each Named Executive Officer outstanding as of the
      end
      of our most recently completed fiscal year. Each outstanding award is
      represented by a separate row which indicates the number of securities
      underlying the award.




For
      option awards, the following table discloses the shares granted, the number
      exercisable at year end, the number of shares that are not yet exercisable,
      exercise price, and the expiration date.




Name
              
              Number
                  Of Option Shares Granted
              
              Number
                  Of Option Shares Exercisable
              
              Number
                  Of Option Shares Unexercisable
              
              Option
                  Expiration Date
              
              Option
                  Exercise PriceDon
                  Wallace
              
              
              121,212(1)
              
              
              48,484
              
              
              72,728
              
              
              8/20/2014
              
              $
              1.00John
                  Horton
              
              
              121,212(1)
              
              
              48,484
              
              
              72,728
              
              
              8/20/2014
              
              $
              1.00John
                  Horton
              
              
              243,360(2)
              
              
              
              
              
              243,360
              
              
              12/28/2016
              
              $
              1.00Chuck
                  Thibault(3)
              
              
              3⁄4
              
              
              3⁄4
              
              
              3⁄4
              
              
              3⁄4
              
              
              3⁄4




(1)
            Options
                were granted on August 20, 2004. Options have a one year term and
                vest
                ratably over a five year period on
                the


(2)
            anniversary
                date of the grant. The exercise price of shares is
                $1.00.


(3)
            One-third
                of this grant becomes exercisable on a ratable basis over a five
                year
                period on the anniversary of the grant. One-third becomes exercisable
                upon
                BRS achieving a financial return of 25%. One-third becomes exercisable
                upon BRS achieving a financial return of 30%. Shares have a 10 year
                term
                and an exercise price of $1.00.


(4)
            On
                August 20, 2004, Mr. Thibault was granted 121,212 options shares
                that
                became exercisable over a five year period on a pro rata basis. No
                shares
                were exercised and all shares were cancelled upon Mr. Thibault’s
                retirement on October 2, 2006.





We
      do not
      have any nonqualified deferred contribution or other nonqualified deferred
      compensation plans.


62


**Option
      Exercises & Surrenders And Stock Vested In 2006**




During
      fiscal 2006, there were no option exercises. During 2006, Mr. Thibault
      surrendered all option shares that he received in conjunction with his grant
      of
      121,212 option shares on August 20, 2004. The surrender of shares resulted
      from
      his retirement on October 2, 2006.





**Severance
      Plans** **-** Mr.
      Wallace, Mr. Horton and Mr. Thibault are entitled to receive severance benefits
      upon certain qualifying terminations of employment based on an applicable
      provision in each executive’s employment agreement. These severance arrangements
      are intended to retain executives and provide continuity of management in
      connection with a threatened or actual change in control transaction. The
      principal elements of the severance provisions in their agreements are as
      follows:





·
            Mr.
                Wallace is entitled to base salary for 6 months and all benefits
                provided
                for in his employment agreement.





·
            Mr.
                Horton is entitled to base salary for 24 months and bonus payments
                based
                on the bonus that would have been payable to the executive for the
                fiscal
                year in which the employment is terminated. He is also entitled to
                all
                benefits provided for in their employment agreements for 24
                months.





·
            Mr.
                Thibault retired on October 2, 2006. Under his enrollment agreement,
                he
                will receive medical and dental coverage until the earlier of his
                death or
                becoming eligible for coverage under
                Medicare.





**Potential
      Payments Upon Termination**





The
      following table shows potential payments to our Named Executive Officers for
      various scenarios involving termination of each Named Executive Officer who
      is
      covered by an Employment Agreement. We have assumed a termination date of
      December 31, 2006. These amounts are estimates only. The actual amounts to
      be
      paid out can only be determined at the time of such Officer’s separation from
      us.





Under
      the
      Employment Agreements, the Company may repurchase option shares held by the
      Executive at the time of his termination. We have assumed that the repurchase
      cost at December 31, 2006 is $0 and all options would be cancelled.


**Name**
                      
                      **Executive
                          Benefit Payments Upon Termination**
                      
                      **Retirement**
                      
                      **Involuntary
                          Not For Cause Termination**
                      
                      **For
                          Cause Termination**
                      
                      **Involuntary
                          or Good Reason Termination**
                      
                      **Death
                          or Disability**Don
                          Wallace
                      
                      
                      Base
                          Salary
                      
                      $
                      —
                      
                      $
                      537,350
                      
                      $
                      —
                      
                      $
                      537,350
                      
                      $
                      —Non
                          competition payments
                      
                      $
                      —
                      
                      $
                      1,000,000
                      
                      $
                      —
                      
                      $
                      1,000,000
                      
                      $
                      —Benefits
                      
                      
                      —
                      
                      $
                      $8,094
                      
                      $
                      —
                      
                      $
                      8,094
                      
                      $
                      —John
                          Horton
                      
                      
                      Base
                          Salary
                      
                      $
                      —
                      
                      $
                      1,244,160
                      
                      $
                      —
                      
                      $
                      1,244,160
                      
                      $
                      —Bonus
                      
                      $
                      —
                      
                      $
                      —
                      
                      $
                      —
                      
                      $
                      —
                      
                      $
                      —Benefits
                      
                      $
                      —
                      
                      $
                      $32,900
                      
                      $
                      —
                      
                      $
                      32,900
                      
                      $
                      —Chuck
                          Thibault
                      
                      
                      Post-retirement
                          health insurance
                      
                      $
                      210,450
                      
                      $
                      —
                      
                      $
                      —
                      
                      $
                      —
                      
                      $
                      —
  **Director
            Compensation**




We
      reimburse members of the board of directors for any out-of-pocket expenses
      incurred by them in connection with services provided in such capacity. In
      addition, we compensate members of the Board of Directors who are not employees
      of Lazy Days or BRS $25,000 per year for services provided in that capacity
      and
      an additional $7,500 if such board member serves as the chairman of our audit
      committee or compensation committee. Board members are also paid $2,000 for
      meetings attended in person and $500 for meetings attended telephonically,
      and
      committee members are paid $1,000 per in person and $500 per telephonic meeting
      if a meeting occurs on a different day than a meeting of the full board.





On
      October 7, 2005, the Company entered into a Management Fee Agreement with
      Charles Macaluso. Services provided include management advisory, ongoing
      strategic planning, general corporate matters, organizing, implementing BOD
      activities and related activities. Mr. Macaluso is compensated $10,000 per
      month.





63


In
      October 2006, the Company entered into a Management Fee Agreement with Michael
      Salvati. Services provided include financial staff evaluation, assessing and
      interviewing candidates for the position of Chief Financial Officer, monthly
      review of financial statements and implementation assistance for the new
      enterprise resources management system. Mr. Salvati is compensated $2,000 per
      day as services are rendered.





The
      following table summarizes our director compensation during the 2006 fiscal
      year:


**Board
                  Fees Earned or Paid in Cash**
              
              **Management
                  Fees**Thomas
                  Donnelly
              
              $
              33,000
              
              $
              3⁄4Charles
                  Macaluso
              
              $
              42,000
              
              $
              120,000Thomas
                  Millner
              
              $
              38,000
              
              $
              3⁄4Michael
                  Salvati
              
              $
              44,000
              
              $
              20,500




64


**ITEM 12.
      SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL
      OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS**




Holdings
      owns 100% of our common stock. The following table sets forth certain
      information with respect to the beneficial ownership of RV Acquisition’s Common
      Stock and Series A Preferred Stock as of December 31, 2006, by:
      (i) each person or entity who owns of record or beneficially 5% or more of
      any class of RV Acquisition’s voting securities; (ii) each of our named
      executive officers and directors; and (iii) all of our directors and named
      executive officers as a group. Except as noted below, the address for each
      of
      the directors and named executive officers is 6130 Lazy Days Boulevard, Seffner,
      Florida 33584-2968.




**Security
      Ownership Table**




**Number
                  and % of Shares of RV Acquisitions, Inc. (1)****Series
                  A Preferred Stock**
              
              **Common
                  Stock****Shares**
              
              **%
                  Total**
              
              **Shares**
              
              **%
                  Total****Greater
                  than 5% Stockholders**Bruckmann,
                  Rosser, Sherrill & Co. II, L.P.
                126
                  East 56th Street
                New
                  York, New York 10022(2)
              
              
              35,534
              
              
              57.4
              %
              
              4,216,077
              
              
              84.4
              %Don
                  Wallace
              
              
              22,906
              
              
              37.0
              %
              
              531,915
              
              
              10.6
              %**Named
                  Executive Officers and Directors**Chuck
                  Thibault
              
              
              *
              
              
              *
              
              
              *
              
              
              *John
                  Horton
              
              
              *
              
              
              *
              
              
              *
              
              
              *Patrick
                  Overby
              
              
              *
              
              
              *
              
              
              *
              
              
              *Ken
                  Scolaro
              
              
              *
              
              
              *
              
              
              *
              
              
              *Steve
                  Ratcliff
              
              
              *
              
              
              *
              
              
              *
              
              
              *Bob
                  Grady
              
              
              *
              
              
              *
              
              
              *
              
              
              *Charles
                  Macaluso
              
              
              *
              
              
              *
              
              
              *
              
              
              *Thomas
                  Baldwin(2),(3)
              
              
              —
              
              
              —
              
              
              —
              
              
              —Stephen
                  Sherrill(2),(3)
              
              
              —
              
              
              —
              
              
              —
              
              
              —Michael
                  Salvati
              
              
              *
              
              
              *
              
              
              *
              
              
              *Thomas
                  Millner
              
              
              *
              
              
              *
              
              
              *
              
              
              *Thomas
                  Donnelly
              
              
              *
              
              
              *
              
              
              *
              
              
              *All
                  executive officers and directors as a group(4)
              
              
              24,128,933
              
              
              38.9
              %
              
              686,673
              
              
              13.7
              %




*
      Represents less than 1%.





The
      directors and named executive officers as a group beneficially own
      (i) 686,673 shares of Common Stock and (ii) 23,873 shares of
      Series A Preferred Stock.




1.
            Beneficial
                ownership is determined in accordance with Rule 13d-3 under the
                Exchange Act. In computing the number of shares beneficially owned
                by a
                person and the percentage ownership of that person, shares of Common
                Stock
                subject to options held by that person that are currently exercisable
                or
                exercisable within 60 days of closing of the offering are deemed
                outstanding. Such shares, however, are not deemed outstanding for
                the
                purposes of computing the percentage ownership of any other person.
                Holdings is a wholly-owned subsidiary of RV Acquisition and the Company
                is
                a wholly-owned subsidiary of Holdings.





2.
            Bruckmann,
                Rosser, Sherrill & Co. II, LP. (“BRS LP”) is a private equity
                investment fund managed by Bruckmann, Rosser, Sherrill & Co.,
                LLC. BRSE, LLC. (“BRSE”) is the general partner of BRS LP and by virtue of
                such status may be deemed to be the beneficial owner of the shares
                owned
                by BRS LP. BRSE has the power to direct BRS LP as to the voting and
                disposition of shares held by BRS LP. No single person controls the
                voting
                and dispositive power of BRSE with respect to the shares owned by
                BRS LP.
                Bruce C. Bruckmann, Harold O. Rosser, Stephen C. Sherrill, Paul D.
                Kaminski and Thomas J. Baldwin are the managers of BRSE, and none
                of them
                individually has the power to direct or veto the voting or disposition
                of
                shares owned by BRS LP. BRSE expressly disclaims beneficial ownership
                of
                the shares owned by BRS LP. Each of Messrs. Bruckmann, Rosser,
                Sherrill, Kaminski and Baldwin expressly disclaims beneficial ownership
                of
                the shares owned by BRS LP.





3.
            The
                address of each of Mr. Baldwin and Mr. Sherrill is c/o
                Bruckmann, Rosser, Sherrill & Co., Inc., 126 East 56th
                Street, New York, New York 10022.





4.
            Total
                includes shares owned by Don Wallace listed above who is both a 5%
                shareholder and a named executive officer and director.





65


**ITEM 13.
      CERTAIN
      RELATIONSHIPS AND RELATED
      TRANSACTIONS AND DIRECTOR INDEPENDENCE**




**Agreements
      to be Entered into in Connection with the Transactions**




**Stock
      Purchase Agreement**




Pursuant
      to the stock purchase agreement, RV Acquisition agreed to acquire all of
      Holdings’ outstanding common and preferred stock for a purchase price of
      $206.0 million (including repayments of certain indebtedness and subject to
      pre-closing working capital, tax benefit and cash adjustments). In connection
      with the Acquisition, we repaid all of our existing indebtedness, which was
      equal to $59.0 million as of May 14, 2004, and paid approximately
      $11.1 million for certain transaction related fees and expenses. In
      connection with the Acquisition, each holder of shares of our capital stock
      was
      entitled to receive a portion of the stock purchase consideration. The ESOP
      was
      terminated in connection with the Acquisition. Immediately following the
      Acquisition, RV Acquisition’s outstanding Common Stock was equal to
      approximately 89% owned by BRS LP, its affiliates and co-investors and the
      remainder was owned by existing members of management and existing stockholders.
      The stock purchase agreement contained customary provisions for such agreements,
      including representations and warranties with respect to the condition and
      operations of the business, covenants with respect to conduct of the business
      prior to and following the closing date of the stock purchase, and various
      closing conditions, including the execution of a non-compete agreement with
      Don
      Wallace, execution of an escrow agreement, the amendment to our existing floor
      plan credit facility, the closing of our new senior secured revolving credit
      facility, an amendment to our facility lease with 1-4 (described below), the
      obtaining of financing and the continued accuracy of the representations and
      warranties. A portion of the consideration was deposited into escrow accounts,
      including $20.0 million of cash and $20.0 million of new Series A
      Preferred Stock of RV Acquisition (to be issued to certain existing stockholders
      of Holdings) to support indemnity obligations of the selling stockholders.




**Stock
      Purchase Consideration**




In
      connection with the Transactions, Don Wallace received $22.9 million in
      Series A Preferred Stock, $0.5 million in Common Stock,
      $7.0 million of Restricted Old Notes and $3.4 million in cash with
      respect to the equity in Holdings owned by him. ESOP holders received a total
      of
      $24.6 million. Other existing shareholders of Holdings received
      $102.9 million.




**Stockholders
      Agreement**




In
      connection with the Transactions, the stockholders of RV Acquisition, including
      BRS LP, entered into a stockholders agreement, which establishes the composition
      of the board of directors and provides for certain restrictions and rights
      with
      respect to sales and issuances of RV Acquisition’s securities. In particular,
      the stockholders agreement provides that no employee holder may transfer his
      or
      her capital stock of RV Acquisition, except to immediate family members, family
      trusts and charitable organizations. Employees have the right to sell a pro
      rata
      portion of their stock in RV Acquisition if BRS LP elects to sell all or portion
      of its Holdings stock. BRS LP also has the right to cause a sale of RV
      Acquisition to occur and to require the other holders of RV Acquisition stock
      to
      participate in such a sale. Finally, if RV Acquisition proposes to issue new
      equity securities to BRS LP, each holder of RV Acquisition stock has the right
      to purchase its pro rata share of such new securities.




**Registration
      Rights Agreement**




In
      connection with the Transactions, RV Acquisition entered into a registration
      rights agreement with BRS LP and certain other equity holders of RV Acquisition.
      Under the registration rights agreement, BRS LP and such other equity holders
      have the ability to cause RV Acquisition to register securities of RV
      Acquisition held by the parties to the registration rights agreement and to
      participate in registrations by RV Acquisition of its equity securities.




**Employment
      Agreements; Stock Option Plan**




Upon
      closing of the Transactions, we entered into new employment agreements with
      certain key employees. On August 20, 2004, we put in place a new stock
      option plan which will provide for issuances of common stock of RV Acquisition
      to certain key management employees, including the named executive officers.
      See
“Item 11—Executive Compensation—Employment Agreements” and “Item 11—Executive
      Compensation—Benefit Plans—Stock Option Plan.”





66


**Management
      Services Agreement**




In
      connection with the Transactions, we entered into a management services
      agreement (the “Management Services Agreement”) with Bruckmann, Rosser,
      Sherrill & Co., LLC (“BRS LLC”), an affiliate of BRS. Under the terms
      of this agreement, BRS LLC provides:




·
            general
                management services;





·
            assistance
                with the negotiation and analysis of financial alternatives; and





·
            other
                services agreed upon by BRS LLC




In
      exchange for these services, BRS LLC and Don Wallace will earn an annual fee
      equal to the greater of:




(1)
            1.75%
                of our annual EBITDA (as defined in the indenture related to the
                notes);
                or





(2)
            $500,000.




10.6%
      of such fee will be
      payable to Don Wallace and 89.4% will be payable to BRS LLC. In addition to
      certain restrictions on the payment of the management fee contained in the
      senior secured revolving credit facility and the amended floor plan credit
      facility, the management services agreement contains certain restrictions on
      the
      payment of that fee. The management services agreement also provides that the
      payment of all fees and other obligations under the management services
      agreement will be subordinated to the prior payment in full in cash of all
      interest, principal and other obligations on our notes and the new senior
      secured revolving credit facility in the event of a bankruptcy, liquidation
      or
      winding-up of Lazydays.




BRS
      LLC
      provided various advisory services to us related to the Transactions. These
      services included arranging and negotiating the refinancing of the senior
      secured revolving credit facility and amended floor plan credit facility,
      arranging and structuring the Acquisition, including forming RV Acquisition
      and
      planning its capital structure, planning Lazydays’ structure and related
      services. Pursuant to the Management Services Agreement, for these services,
      BRS
      LLC and Don Wallace received a transaction fee of $3.5 million plus
      reasonable expenses upon completion of the Transactions. 10.6% of such fee
      was
      payable to Mr. Wallace and 89.4% was payable to BRS LLC. In addition, BRS
      LLC will be entitled to receive a transaction fee equal to 1.5% of the
      transaction value upon any future material acquisition, divestiture, financing
      or refinancing by RV Acquisition, Holdings or us.




**Issuance
      of Series A Preferred Stock to BRS LP and Certain Existing Stockholders of
      Holdings**




In
      connection with the Transactions, RV Acquisition issued 62,000 shares of new
      Series A Preferred Stock at a purchase price of $1,000 per share, for an
      aggregate purchase price of $62.0 million. The Series A Preferred
      Stock was purchased through a contribution of $20.0 million of existing
      Holdings equity to RV Acquisition in exchange for Series A Preferred Stock
      and an additional $42.0 million, of which $37.5 million was purchased
      with cash contributed by BRS LP, and $4.5 million was issued to Don Wallace
      in exchange for Holdings equity contributed to RV Acquisition by him in exchange
      for Series A Preferred Stock.




Dividends
      on the Series A Preferred Stock will accrue at a rate of 14% per
      annum, compounded semi-annually. Dividends on the Series A Preferred Stock
      are not required to be paid in cash and will accrue whether or not declared
      and
      whether or not there are profits, surplus or other funds legally available
      for
      payment of the dividend.




The
      Series A Preferred Stock will have a liquidation preference equal to the
      purchase price plus accrued and unpaid dividends. If an “organic change” (i.e.,
      a merger or sale of substantially all of the Company’s assets) occurs, the
      holders of the Series A Preferred Stock may require redemption of all or
      any portion of their shares at the amount of the liquidation preference plus
      accrued and unpaid dividends. The Series A Preferred Stock will, with
      respect to dividends, rights upon liquidation, winding up and dissolution,
      rank
      senior to RV Acquisition’s Common Stock. RV Acquisition will be unable to
      authorize any dividend or distribution, or pay any dividend or make any
      distribution with respect to any junior securities, unless all accrued and
      unpaid preferred dividends have been paid in cash. In addition, RV Acquisition
      will be unable to effect any redemption or repurchase of any junior securities
      (other than upon the exercise by RV Acquisition’s repurchase rights with respect
      to any Common Stock issued to employees or others providing services upon a
      termination of their employment or other service relationship) unless the
      Series A Preferred Stock has been redeemed. Except as otherwise required by
      law or provided in the Company’s certificate of incorporation, the holders of
      Series A Preferred Stock will not be entitled to vote.




The
      holders of a majority of the Series A Preferred Stock have the right, upon
      certain change of control transactions, to have such transaction treated as
      a
      liquidation event, as a result of which all shares of Series A Preferred
      Stock will be redeemed at a price equal to the liquidation preference plus
      accrued and unpaid dividends.





67


The
      holders of the Series A Preferred Stock will also be offered the right to
      purchase a pro rata share of any other preferred equity securities (or rights
      to
      acquire preferred equity securities, such as warrants, convertibles, etc.)
      to be
      offered by RV Acquisition to BRS LP or its affiliates on the same terms they
      are
      offered to such parties. BRS LP will also grant to the other holders of
      Series A Preferred Stock the right to participate (on a pro rata basis and
      on the same terms and conditions) in any sale of Preferred Stock held by BRS
      LP
      to a third-party. The $20.0 million of new Series A Preferred Stock of
      RV Acquisition issued to the existing stockholders of Holdings will be held
      in
      escrow to support indemnity obligations of the selling stockholders. During
      the
      period that starts on the closing of the stock purchase agreement and ends
      two
      years following the filing of certain governmental filings relating to the
      ESOP
      with the Department of Labor, the sellers may not transfer certain of their
      shares of Series A Preferred Stock held by them other than pursuant to a
      one-year call arrangement between Don Wallace and one other seller or certain
      permitted transferees.




**Issuance
      of Common Stock to BRS LP and Certain Existing Stockholders of Holdings**




In
      connection with the Acquisition, RV Acquisition issued 5,000,000 shares of
      new
      Common Stock, par value $0.01 per share at a purchase price of $1.00 per share,
      for an aggregate purchase price of $5.0 million. Of the $5.0 million
      of Common Stock, $4.5 million of Common Stock was purchased by BRS LP for
      cash. The balance of $0.5 million was issued to Don Wallace in exchange for
      certain equity in Holdings contributed by him to RV Acquisition.




**Private
      Placement of RV Acquisition Stock**




On
      September 28, 2004, RV Acquisition and BRS LP consummated an offering
      of RV Acquisition Stock previously held by BRS LP and its affiliates to
      certain employees of Lazy Days. As a result, 186,787 shares of RV
      Acquisition Common Stock and 1,489,228 shares of RV Acquisition
      Series A Preferred Stock were sold to such employees that participated in
      the private placement.




**The
      ESOP**




In
      July 1999 the ESOP borrowed funds from Lazydays to purchase, through a
      holding company, shares of Lazydays Class A common stock representing
      beneficial ownership of 75% of the common stock of Lazydays from Don Wallace
      which, together with the existing 9% interest the ESOP already owned, made
      the
      ESOP an 84% beneficial owner of Lazydays. As part of the 2002 restructuring
      described below, these shares were converted via merger into the Class A
      common stock and Class C common stock of Holdings and have been held by the
      ESOP in the ESOP trust’s suspense account and allocated to individual
      participants in the ESOP as the loan has been repaid. Subsequently, also as
      a
      result of the 2002 restructuring described below, additional equity securities
      were issued to the Company’s debt holders, which effectively diluted the ESOP’s
      equity ownership interest in the Company. The loan obligation of the ESOP of
      $95,523,365 at December 31, 2003 was considered unearned employee ESOP
      shares and, as such, was recorded as a reduction to Holdings’ stockholders’
equity. Holdings’ contributions to the ESOP, plus any dividends paid on
      unallocated shares held by the ESOP, have been used to repay the loan principal
      and interest. Both the loan obligation and the unearned ESOP shares have been
      reduced by the amount of the loan principal repayments made by the ESOP. The
      ESOP compensation expense totaled $534,000 for the year ended December 31,
      2004. The compensation expense was computed based upon the fair value of the
      ESOP shares committed to be released to participants for the relevant year.




As
      ESOP
      participants became entitled to receive a stock distribution from the ESOP
      (i.e., in the event of retirement, death, total disability or termination of
      employment), certain participants put their shares to Holdings. If Holdings’
required payment for those shares exceeded a certain amount, Holdings issued
      notes to such participants. These notes were payable to various participants
      in
      annual installments over a period of five years, bearing interest at 8%.
      Approximately $1.2 million in principal of these distribution notes was
      outstanding at December 31, 2003, all of which were repaid in full and
      cancelled at closing in connection with the Transactions.




Certain
      allocated ESOP shares had premium floor price put rights. Holdings’ aggregate
      obligation to repurchase the ESOP’s shares under these put obligations at
      December 31, 2003 was approximately $18.6 million. In connection with
      the Acquisition, all of the allocated shares with premium floor price put rights
      were paid an amount at closing equal to the applicable put price with respect
      to
      such shares. We used the proceeds from the Transactions to satisfy any
      outstanding ESOP obligations discussed above, including Holdings’ outstanding
      distribution notes and put obligations.




In
      connection with the Transactions, the ESOP was terminated and three categories
      of Holdings’ stock were purchased from the ESOP. Those categories were
      (1) Class A common stock allocated to ESOP participants and subject to
      a premium floor price, (2) Class C common stock allocated to ESOP
      participants and subject to a premium floor price and (3) Class A
      common stock, whether allocated or unallocated, not subject to a premium floor
      price. Proceeds received by the ESOP from the sale of the unallocated suspense
      account shares were used to pay principal and interest on the loan. After such
      payment, Lazydays forgave any remaining loan balance owed to it by the ESOP.




The
      ESOP was subject to applicable provisions of the
      Internal Revenue Code of 1986, as amended (the "Code") and the Employee
      Retirement Income Security Act of 1974, as amended ("ERISA"), and regulations
      thereunder, designed to protect the ESOP's participants and beneficiaries.
      The
      ESOP was a party to certain corporate and restructuring transactions entered
      into by Holdings and its affiliates in 1999, 2002 and 2004. In 2005 the
      Internal Revenue Service issued a favorable determination letter regarding
      the
      termination of the ESOP and in 2006 the Department of Labor finalized their
      review and determined no outstanding issues exist.




68


**Facility
      Lease Agreement**




The
        Company leases land and certain of its facilities from I-4 Land Holding Limited
        Company (“I-4”), a related entity controlled by Don Wallace under an operating
        lease arrangement which expires in December, 2022. The lease contains four
        (4)
        five-year renewal options upon expiration of the original lease term. The
        lease
        requires minimum monthly rental payments of approximately $309,000 through
        June 30, 2004 and $399,490 thereafter before abatements (subject to
        adjustments in 2008, 2013 and 2018 for increases in the CPI) and provides
        that
        the lessee pays all property taxes and insurance. Rent is recognized
        straight-line over the life of the lease resulting in deferred rent during
        the
        earlier years of the lease. The Company is responsible for maintenance costs
        and
        betterments on the facilities.
  On
        October 12, 2006, the Company amended this lease agreement with I-4.  The
        lease was amended to modify the purchase option from $42 million (subject
        to CPI
        increases) through May 14, 2011 to a fair market value purchase option, as
        defined, through January 15, 2023; to permit I-4 to purchase certain of the
        Company's buildings located on land leased by the Company from I-4 as part
        of an
        asset purchase agreement, as well as reduce rents owed by the Company to
        I-4 by
        an aggregate of $2.7 million during 2006, 2007 and 2008. The amended lease
        agreement also gives the Company a right to purchase certain adjacent land
        currently rented by a third party.  Finally, the amended lease agreement
        and asset purchase agreement provided the Company with $11.6 million of cash,
        preserved its business use of all the leased real property and significantly
        reduced the Company's future lease obligation without increasing the existing
        lease term.




**Consignment
      Sales Agreement**




We
      hold
      new vehicles under a consignment arrangement with I-4 for up to 180 days.
      During the term of the agreement, we have purchased all inventories that have
      been held under consignment. The total consigned inventory, which is not
      included in our balance sheets, approximated $14.3 million and
      $17.4 million at December 31, 2006 and December 31, 2005,
      respectively. Total consigned inventory purchased by us has totaled
      approximately $107 million and $143 million for the years ended
      December 31, 2006 and December 31, 2005, respectively. This
      consignment arrangement, as amended October 12, 2006, requires the Company
      to
      begin paying consideration for the consignment of such units.  Required
      payments begin in October 2007 and are based on U.S. Treasury rates times the
      average value of units on hand, as defined.




**Purchase
      of Restricted Notes; Exchange Offer**




Don
      Wallace purchased $15.0 million in aggregate principal amount of restricted
      notes in connection with the offering of our senior notes due 2012, of which
      $7.0 million in consideration was comprised of equity in Holdings and the
      remainder was purchased for cash. Because Mr. Wallace is an affiliate, the
      restricted notes held by him were not eligible to be exchanged in connection
      with our exchange offer. In connection with our exchange offer, $137 million
      in
      aggregate principal amount of outstanding privately placed senior notes for
      public notes which was consummated in December of 2004.




**Air
      Charter Services**




Don
      Wallace owns a 100% interest in Air Logic Solutions, an air charter services
      company. In 2005 the Company paid Air Logic Solutions, on arms-length terms,
      $60,493 for air charter services. In 2006, the Company did not use the services
      of Air Logic Solutions.




69


**ITEM 14.**  **PRINCIPAL
      ACCOUNTANT FEES AND SERVICES**




The
      following table presents fees for services provided to the Company by Crowe
      Chizek and Company LLC for 2006 and 2005 (dollars in thousands).





**2006**
            
            **2005**Audit
                Fees (a)
            
            $
            280
            
            $
            254Audit-Related
                Fees (b)
            
            $
            69
            
            $
            21Tax
                Fees (c)
            
            $
            37
            
            $
            122All
                Other Fees
            
            $
            —
            
            $
            —Total
            
            $
            386
            
            $
            397




(a)
            Fees
                for professional services provided for the audit of the Company’s annual
                financial statements as well as preissuance reviews of Lazydays’ quarterly
                reports on Form 10-Q, accounting consultations on matters addressed
                during
                the audit or interim reviews, and SEC filings.


(b)
            Fees
                for professional services which principally include consultations
                relative
                to SEC filings and the Company’s real estate lease transaction.


(c)
            Fees
                for professional services for tax related advice and compliance,
                including
                a transaction cost recovery study and acquisition analysis in 2005,
                which
                related to the 2004 tax period.




70


**PART
      IV**




**ITEM 15.
      EXHIBITS AND FINANCIAL
      STATEMENT SCHEDULES**




(a)(1)
      Financial Statements:




See
      Part
      II, Item 8. Financial Statements and Supplementary Data for an index of the
      Company’s financial statements.




(a)(2)
      The following financial statement schedule is included in Item 8,
“Financial Statements and Supplementary Data”




Schedule
      II - Valuation and Qualifying Accounts




(a)(3)
      Exhibits required by Item 601 of Regulation S-K.




See
      attached Exhibit Index.




71


**SIGNATURES**




Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act
      of 1934, Lazy Days’ R.V. Center, Inc. has duly caused this report to be signed
      on its behalf by the undersigned, thereto duly authorized, in the city of
      Seffner, Florida, on the 31st day of March, 2006.




Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed by the following persons on behalf of Lazy Days’ R.V. Center, Inc. and in
      the capacities and on the dates indicated.




**LazyDays'
              R.V. Center, Inc.**Date: March
              31, 2007
            By:
            /s/ John
              HortonChief
              Executive Officer





**Signature**
            **Title**
            **Date**/s/John
                Horton
            Chief
                Executive Officer
              (Principal
                Executive Officer)
            March
                31, 2007John
                Horton/s/
                Linda Stephens
            Director
                of Corporate Reporting
              and
                Investor Relations
            March
                31, 2007Linda
                Stephens/s/
                Charles Macaluso
            Director
            March
                31, 2007Charles
                Macaluso/s/
                Stephen Sherrill
            Director
            March
                31, 2007Stephen
                Sherrill/s/
                Thomas Baldwin
            Director
            March
                31, 2007Thomas
                  Baldwin/s/
                Michael Salvati
            Director
            March
                31, 2007Michael
                  Salvati/s/
                Thomas Donnelly
            Director
            March
                31, 2007Thomas
                  Donnelly/s/
                Thomas Millner
            Director
            March
                31, 2007Thomas
                Millner


****


72


**SUPPLEMENTAL
      INFORMATION TO BE FURNISHED PURSUANT TO SECTION 15 (d) OF THE ACT BY
      REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF
      THE
      ACT.**




No
      annual
      report to security holders covering the registrant’s last fiscal year has been
      sent to security holders. No proxy statement, form of proxy or other proxy
      soliciting material has been sent to more than 10 of the registrant’s security
      holders with respect to any annual or other meeting of security holders.




**EXHIBIT
      INDEX**





**No.**
            **Exhibit
                Index**2.1
            Stock
                Purchase Agreement by and between Lazy Days, LD Holdings, Inc., the
                Employee Stock Ownership Plan and Trust for the Employees of Lazy
                Days,
                certain other stockholders of LD Holdings, Inc. and RV
                Acquisition Inc., dated as of April 27,
                2004.*2.2
            Disclosure
                Schedules to the Stock Purchase Agreement by and between Lazy Days,
                LD
                Holdings, Inc., the Employee Stock Ownership Plan and Trust for the
                Employees of Lazy Days, certain other stockholders of LD
                Holdings, Inc. and RV Acquisition Inc., dated as of May 14,
                2004.*3.1
            Amended
                and Restated Articles of Incorporation of Lazy Days, dated as of
                August 6, 2002.*3.2
            Amended
                and Restated By-laws of Lazy Days, dated as of August 6,
                2002.*4.1
            Indenture
                by and between Lazy Days, a Florida corporation, and The Bank of
                New York,
                a New York banking corporation, dated as of May 14,
                2004.*4.2
            Registration
                Rights Agreement by and among Lazy Days, Deutsche Bank
                Securities Inc., Jefferies & Company, Inc. and Wells
                Fargo Securities, LLC, dated as of May 14, 2004.*4.3
            Purchase
                Agreement by and among Lazy Days, Deutsche Bank Securities Inc.,
                Jefferies & Company, Inc. and Wells Fargo Securities, LLC,
                dated as of May 12, 2004.*10.1
            Agreement
                Among Sellers by and among LD Holdings Inc., Lazy Days, the Employee
                Stock Ownership Plan and Trust for the Employees of Lazy Days, the
                Sellers
                signatories thereto, and Oakridge Consulting, dated as of April 27,
                2004.*10.2
            Contribution
                Agreement by and among Donald W. Wallace, Alliance Holdings, Inc.,
                PPM America Special Investments Fund, L.P., Lion Connecticut
                Holdings, Inc., (as successor by merger to Reliastar Financial
                Corp.), PPM America Special Investments CBO II, L.P., PB Capital
                Corporation, The Provident Bank, RV Acquisition Inc., and Bruckmann,
                Rosser, Sherrill & Co. II, L.P., dated as of May 14,
                2004.*10.3
            Employment
                Agreement by and among Lazy Days, RV Acquisition Inc., John Horton,
                and Bruckmann, Rosser, Sherrill & Co. II, L.P., dated as of
                May 14, 2004.*(1)10.4
            Employment
                Agreement by and among Lazy Days, RV Acquisition Inc., Charles L.
                Thibault, and Bruckmann, Rosser, Sherrill & Co. II, L.P., dated
                as of May 14, 2004.*(1)10.5
            Employment
                Agreement by and among Lazy Days, RV Acquisition Inc., Donald W.
                Wallace, and Bruckmann, Rosser, Sherrill & Co. II, L.P., dated as
                of May 14, 2004.*(1)10.6
            Termination
                Agreement by and among Lazy Days, LD Holdings, Inc., LDRV Holdings
                Corp., Alliance Holdings, Inc., Donald W. Wallace, PPM America
                Special Investments Fund, L.P., PPM America Special Investments CBO
                II,
                L.P., Lion Connecticut Holdings, Inc., (as successor by merger to
                Reliastar Financial Corp.), PB Capital Corporation, The Provident
                Bank,
                and James L. Farnsworth (not in his individual capacity, but solely
                as
                trustee of the Employee Stock Ownership Plan and Trust for the employees
                of Lazy Days as directed by Consulting Fiduciaries, Inc.), dated as
                of May 14, 2004.*10.7
            Escrow
                Agreement by and among Alliance Holdings, Inc., PPM America Special
                Investments Fund, L.P., Lion Connecticut Holdings, Inc., (as
                successor by merger to Reliastar Financial Corp.), PPM America Special
                Investments CBO II, L.P., PB Capital Corporation, The Provident Bank,
                RV
                Acquisition Inc., Donald W. Wallace, Oakridge Consulting, Inc.
                (acting hereunder through Michael Salvati, not individually, but
                solely as
                agent for the Sellers), RV Acquisition Inc. and Wells Fargo Bank,
                National Association (as escrow agent), dated as of May 14,
                2004.*10.8
            Redemption
                Agreement by and among LD Holdings, Inc. and Lazy Days, dated as of
                May 14, 2004.*10.9
            Management
                Agreement by and among Bruckmann, Rosser, Sherrill & Co., L.L.C.,
                RV Acquisition Inc., LD Holdings, Inc., and Lazy Days, dated as
                of May 14, 2004.*




73


10.10
            Non-compete
                and Covenant Agreement by and among Lazy Days, RV Acquisition Inc.,
                Donald W. Wallace, and Bruckmann, Rosser, Sherrill &
                Co. II, L.P., dated as of May 14, 2004.*(1)10.11
            Registration
                Rights Agreement by and among RV Acquisition Inc., Bruckmann, Rosser,
                Sherrill & Co. II, L.P., Donald W. Wallace, and each of the
                executives of Lazy Days who executes a joinder to the Agreement on
                or
                after the date thereof, dated as of May 14, 2004.*10.12
            Stockholders
                Agreement by and among RV Acquisition Inc., Bruckmann, Rosser,
                Sherrill & Co. II, L.P., Donald W. Wallace, each of the
                executives of Lazy Days who executes a joinder to the Agreement on
                or
                after the date thereof, and Alliance Holdings, Inc., dated as of
                May 14, 2004.*10.13
            Wallace
                Contribution Agreement by and among Donald W. Wallace, RV
                Acquisition Inc., and Bruckmann, Rosser, Sherrill & Co. II,
                L.P., dated as of May 14, 2004.*10.14
            Wallace
                Note Agreement by and among Donald W. Wallace and Lazy Days, dated
                as of
                May 14, 2004.*10.15
            Second
                Amended and Restated Floor Plan Credit Agreement by and among Lazy
                Days,
                Bank of America, N.A. (successor by merger to Banc of America Specialty
                Finance, Inc.), and KeyBank National Association (a national banking
                association), amended and restated as of May 14,
                2004.*10.16
            Second
                Amended and Restated Floor Plan Security Agreement by and among Lazy
                Days
                and Bank of America, N.A. (successor by merger to Banc of America
                Specialty Finance, Inc.), amended and restated as of May 14,
                2004.*10.17
            Ground
                Lease by and between I-4 Land Holding Limited Company and Lazy Days,
                dated
                as of July 1999.*10.18
            First
                Amendment to Lease by and between I-4 Land Holding Limited Company
                and
                Lazy Days, dated as of May 14, 2004.*10.19
            Loan
                and Security Agreement by and between Lazy Days and Wells Fargo
                Foothill, Inc., dated as of May 14, 2004.*10.20
            Collateral
                Assignment of Stock Purchase Agreement by and between RV
                Acquisition Inc. and Wells Fargo Foothill, Inc., dated as of
                May 14, 2004.*10.21
            Pledge
                and Security Agreement by and among Lazy Days, LD Holdings, Inc. and
                Wells Fargo Foothill, Inc., dated as of May 14,
                2004.*10.22
            Exclusive
                Consignment Contract for Sale of Recreational Vehicles by and between
                I-4
                Land Holding Limited Company and Lazy Days, dated as of December 29,
                2001.*10.23
            RV
                Acquisition Inc. 2004 Stock Option Plan, as adopted on August 20,
                2004. **(1)10.24
            Form
                of Non-Qualified Stock Option Agreement.**(1)10.25
            Form
                of Subscription Agreement.**(1)10.26
            First
                Amended and Restated Amendment No. 1 to Second Amended and Restated
                Floor
                Plan Credit Agreement dated January 17, 2006, by Lazy Days’ R.V. Center,
                Inc., a Florida corporation (the “Company”), BANK OF AMERICA, N.A.
                (successor by merger to Banc of America Specialty Finance, Inc.),
                as
                Administrative Agent and as Collateral Agent, and Bank of America,
                N.A.
                (successor by merger to Banc of America Specialty Finance, Inc.)
                and
                Keybank National Association, as Lenders filed as Exhibit 10.29 to
                Form
                8-K dated January 17, 2006.10.27
            Collateral
                Assignment of Leases, dated as of October 28, 2004, by and between
                Lazy Days’ R.V. Center, Inc., a Florida corporation, and Bank of
                America, N.A. (as successor by merger to Banc of America Specialty
                Finance, Inc.), as collateral agent (together with its successors in
                trust under the Second Amended and Restated Floor Plan Collateral
                Agency
                Agreement originally dated as of July 15, 1999, as amended and
                restated as of July 31, 2002, and as amended and restated as of
                May 14, 2004.*10.28
            Amendment
                No. 3 to Second Amended and Restated Floor Plan Credit Agreement
                dated as
                of January 17, 2006, by Lazy Days’ R.V. Center, Inc., a Florida
                corporation, Bank of America, N.A. (successor by merger to Banc of
                America
                Specialty Finance, Inc.), as Administrative Agent and as Collateral
                Agent,
                and Bank of America, N.A. (successor by merger to Banc of America
                Specialty Finance, Inc.) and Keybank National Association, as Lenders,
                filed as Exhibit 10.28 to Form 8-K dated January 17, 2005 and hereby
                incorporated by reference herein.10.29
            Amendment
                No. 2 to Second Amended and Restated Floor Plan Agreement dated as
                of May
                23, 2005, by Lazy Days’ R.V. Center, Inc., an Florida corporation, Bank of
                America, N.A. (successor by merger to Banc of America Specialty Finance,
                Inc.), as Administrative Agent and as Collateral Agent, and Bank
                of
                America, N.A. (successor by merger to Banc of America Specialty Finance,
                Inc.) and Keybank National Association, as lenders, filed as Exhibit
                99.1
                to Form 8-K dated May 27, 2005 and hereby incorporated by reference
                herein.




74


10.30
            Management
                Fee Agreement with Charles Macaluso, dated October 7, 2005, filed
                as
                Exhibit 99.1 to Form 8-K dated October 13, 2005 and hereby incorporated
                by
                reference herein.(1)10.31
            First
                Amendment**,**dated
                as of September 29, 2006, to the Loan and Security Agreement**,**dated
                as of May 14, 2004*, by and betweenWells
                Fargo Foothill, Inc.**,**a
                California corporation (the "Lender"),
                andLazy
                Days' R.V. Center, Inc.,a
                Florida corporation (the "Borrower",)
                filed as Exhibit 10.3 to Form 8-K dated October 04, 2006.




10.32
            Second
                Amendment, dated as of October 12, 2006, to Ground Lease dated July
                15,
                1999*, between I-4 Land Holding Limited Company, a Florida limited
                liability company (“Landlord”), and Lazy Days’ R.V. Center, Inc., a
                Florida corporation (“Tenant”,) filed as Exhibit 10.31 to Form 8-K dated
                October 18, 2006.10.33
            First
                Amendment, dated as of October 12, 2006, to Exclusive Consignment
                Contract
                for Sale of Recreational Vehicles, dated December 29, 2001*, is between
                I-4 Land Holding Limited Company, a Florida limited liability company,
                and
                Lazy Days’ R.V. Center, Inc., a Florida corporation, filed as Exhibit
                10.32 to Form 8-K dated October 18, 2006.10.34
            Asset
                Purchase Agreementdated as of 26thday of September, 2006, between****I-4****Land
                Holding Limited Company**,**a
                Florida limited liability company (the “Buyer”), andLazy
                Days’ R.V. Center, Inc.**,**a
                Florida corporation (the “Seller”,) filed as Exhibit 10.33 to Form 8-K
                dated October 18, 2006.10.35
            Amendment,
                dated as of December 28, 2006 amends the Employment Agreement dated
                as of
                May 14, 2004*(1) by Lazy Days R.V. Center, Inc., a Florida corporation
                (the “Company”),
                RV Acquisition Inc., a Delaware corporation, John Horton (the
                “Executive”),
                and Bruckmann, Rosser, Sherrill & Co. II, L.P., a Delaware limited
                partnership, filed as Exhibit 10.1 to Form 8-K dated January 3,
                2007.10.36
            Amendment,
                dated as of December 28, 2006, pursuant to Article 6.6 of the RV
                Acquisition Inc. 2004 Stock Option Plan* (the "Plan"),
                the Board of Directors of RV Acquisition Inc. (the “Corporation”)
                adopted a resolution to amend the Plan and increase the number of
                shares
                of common stock of the Corporation subject to the Plan, filed as
                Exhibit
                10.2 to Form 8-K dated January 3, 2007.10.37
            Non-qualified
                stock option agreement, dated as of December 28**,**between
                RV Acquisition Inc., a Delaware corporation (the “Company”),
                and John Horton****(the
                “Optionee”),
                filed as Exhibit 10.3 to Form 8-K dated January 3,
                2007.10.38
            Third
                Amended and Restated Credit Agreement, originally dated as of July
                15,
                1999, and as amended and restated as of July 31, 2002, May 14, 2004*,
                and
                February 22, 2007),**by
                Lazy Days’ R.V. Center, Inc., a Florida corporation (the “*Company*”),
                Bank of America, N.A. (successor by merger to Banc of America Specialty
                Finance, Inc.), as Administrative Agent and as Collateral Agent,
                and Bank
                of America, N.A. (successor by merger to Banc of America Specialty
                Finance, Inc.) and Key Bank National Association (a national banking
                association), as Lenders, filed as Exhibit 10.30 to Form 8-K dated
                February 27, 2007.10.39
            Retirement
                Agreement with Donald W. Wallace, dated February 7,
                2007.10.40
            Mutual
                Release and Non-disparagement Agreement by Lazy Days R.V. Center,
                Inc., a
                Florida corporation, LD Holdings Inc., RV Acquisition Inc.
                andDonald
                W. Wallace, effective February 7, 2007.10.41
            Consulting
              Agreement with Michael Salvati, dated October 5, 2006.21.1
            Subsidiaries
                of Lazy Days’ R.V. Center, Inc. ***31.1
            Certification
                  of Chief Executive Officer and Chief Financial Officer Pursuant
                  to Section
                  302 of the Sarbanes-Oxley Act of 2002.




*Previously
      filed with Form S-4 on August 12, 2004.


** Previously
      filed with Form S-4/A on October 29, 2004 and hereby incorporated by
      reference herein.


*** Previously
      filed with Form 10-K dated March 31, 2005 and hereby incorporated by
      reference herein.


(1) Compensatory
      plan or arrangement or management contract as defined in Rule 601 of Regulation
      S-K.





75