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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549





FORM 10-Q





(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended November 30, 2008

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: 000-24452





PREMIER EXHIBITIONS, INC.

(Exact name of registrant as specified in its
charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Florida                                                        |  | 20-1424922                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)
|                                                               | 
|3340 Peachtree Road, NE, Suite 2250, Atlanta, GA               |  | 30326                               
|(Address of principal executive offices)                       |  | (Zip Code)                          

(404) 842-2600

(Registrants telephone number, including area code)





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 the registrant was required to file such reports),
and (2) has been subject to such filing requirements for at least the past 90 days.    Yes  x    No   ̈

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



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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).    Yes   ̈    No  x

The number of shares outstanding of the registrants common stock on January 5, 2009 was 29,289,657.









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Table of Contents



|         |  |                                                                                       |  |         
|-------- |  | ------------------------------------------------------------------------------------- |  | --------
|         |  |                                                                                       |  | Page No.
|Part I.  |  | Financial Information                                                                 |  |         
|         |  |                                                                                      
|Item 1.  |  | Financial Statements                                                                  |  | 3       
|         |  |                                                                                      
|Item 2.  |  | Managements Discussion and Analysis of Financial Condition and Results of Operations |  | 13      
|         |  |                                                                                      
|Item 3.  |  | Quantitative and Qualitative Disclosures About Market Risk                            |  | 24      
|         |  |                                                                                      
|Item 4.  |  | Controls and Procedures                                                               |  | 24      
|         |  |                                                                                      
|Part II. |  | Other Information                                                                     |  |         
|         |  |                                                                                      
|Item 1.  |  | Legal Proceedings                                                                     |  | 25      
|         |  |                                                                                      
|Item 1A. |  | Risk Factors                                                                          |  | 25      
|         |  |                                                                                      
|Item 4.  |  | Submission of Matters to a Vote of Security Holders                                   |  | 26      
|         |  |                                                                                      
|Item 6.  |  | Exhibits                                                                              |  | 27      



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PART IFINANCIAL INFORMATION



|ITEM 1. | FINANCIAL STATEMENTS
|------- | --------------------

The condensed consolidated
financial statements of Premier Exhibitions, Inc. and its subsidiaries (collectively, the Company, we, us, or our), included in this Quarterly Report on Form 10-Q were prepared in accordance with
generally accepted accounting principles in the United States of America (GAAP) and pursuant to rules and regulations of the Securities and Exchange Commission (the SEC). Because certain information and notes normally
included in complete financial statements prepared in accordance with GAAP were condensed or omitted pursuant to the rules and regulations of the SEC, the condensed consolidated financial statements should be read in conjunction with the financial
statements and notes thereto included in our audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended February 29, 2008. Results achieved in any interim period are not necessarily reflective of the
results to be expected for the full year.



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Premier Exhibitions, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets



|                                                                                                                                    |  |                  |            |   |                  |   |            |  
|----------------------------------------------------------------------------------------------------------------------------------- |  | ---------------- | ---------- | - | ---------------- | - | ---------- | -
|                                                                                                                                    |  | February 29,2008 |            |   | November 30,2008 |  
|                                                                                                                                    |  |                  |            |   | (unaudited)      |  
|Assets                                                                                                                              |  |                  |            |   |                  |   |            |  
|                                                                                                                                    |  |                 
|Current assets:                                                                                                                     |  |                  |            |   |                  |   |            |  
|Cash and cash equivalents                                                                                                           |  | $                | 16,426,000 |   |                  | $ | 4,709,000  |  
|Marketable securities                                                                                                               |  |                  | 1,055,000  |   |                  |   | 1,273,000  |  
|Accounts receivable, net of allowance for doubtful accounts of $378,000 and $854,000, respectively                                  |  |                  | 3,590,000  |   |                  |   | 8,212,000  |  
|Carpathia receivable, related party                                                                                                 |  |                  | 2,500,000  |   |                  |   |           |  
|Merchandise inventories (net)                                                                                                       |  |                  | 291,000    |   |                  |   | 1,648,000  |  
|Current income tax receivable                                                                                                       |  |                  |           |   |                  |   | 3,271,000  |  
|Prepaid expenses and other current assets                                                                                           |  |                  | 3,682,000  |   |                  |   | 3,978,000  |  
|                                                                                                                                    |  |                  |            |   |                  |   |            |  
|Total current assets                                                                                                                |  |                  | 27,544,000 |   |                  |   | 23,091,000 |  
|                                                                                                                                    |  |                 
|Artifacts owned, at cost                                                                                                            |  |                  | 3,088,000  |   |                  |   | 3,087,000  |  
|Salvors lien                                                                                                                       |  |                  | 1,000      |   |                  |   | 1,000      |  
|Property and equipment, net of accumulated depreciation of $4,707,000 and $6,793,000, respectively                                  |  |                  | 7,308,000  |   |                  |   | 14,431,000 |  
|Exhibition licenses, net of accumulated amortization of $2,752,000 and $4,423,000, respectively                                     |  |                  | 8,450,000  |   |                  |   | 9,270,000  |  
|Goodwill                                                                                                                            |  |                  | 1,377,000  |   |                  |   | 2,224,000  |  
|Deferred income taxes                                                                                                               |  |                  | 1,660,000  |   |                  |   | 1,809,000  |  
|Other assets                                                                                                                        |  |                  | 1,233,000  |   |                  |   | 277,000    |  
|                                                                                                                                    |  |                  |            |   |                  |   |            |  
|                                                                                                                                    |  | $                | 50,661,000 |   |                  | $ | 54,190,000 |  
|                                                                                                                                    |  |                  |            |   |                  |   |            |  
|Liabilities and Shareholders Equity                                                                                                |  |                  |            |   |                  |   |            |  
|                                                                                                                                    |  |                 
|Current liabilities:                                                                                                                |  |                  |            |   |                  |   |            |  
|Accounts payable and accrued liabilities                                                                                            |  | $                | 3,565,000  |   |                  | $ | 8,380,000  |  
|Deferred revenue                                                                                                                    |  |                  |           |   |                  |   | 685,000    |  
|Notes payable                                                                                                                       |  |                  |           |   |                  |   | 96,000     |  
|                                                                                                                                    |  |                  |            |   |                  |   |            |  
|Total current liabilities                                                                                                           |  |                  | 3,565,000  |   |                  |   | 9,161,000  |  
|                                                                                                                                    |  |                 
|Commitments and contingencies                                                                                                       |  |                  |           |   |                  |   |           |  
|                                                                                                                                    |  |                 
|Shareholders equity:                                                                                                               |  |                  |            |   |                  |   |            |  
|Common stock; $.0001 par value; authorized 40,000,000 shares; issued and outstanding 30,166,614 and 30,351,448 shares,
respectively |  |                  | 3,000      |   |                  |   | 3,000      |  
|Additional paid-in capital                                                                                                          |  |                  | 43,147,000 |   |                  |   | 42,946,000 |  
|Retained earnings                                                                                                                   |  |                  | 11,406,000 |   |                  |   | 9,591,000  |  
|Accumulated other comprehensive income (loss)                                                                                       |  |                  | (270,000   | ) |                  |   | (321,000   | )
|Treasury stock, at cost; 1,066,449 shares                                                                                           |  |                  | (7,190,000 | ) |                  |   | (7,190,000 | )
|                                                                                                                                    |  |                  |            |   |                  |   |            |  
|                                                                                                                                    |  |                  | 47,096,000 |   |                  |   | 45,029,000 |  
|                                                                                                                                    |  |                  |            |   |                  |   |            |  
|Total shareholders equity                                                                                                          |  | $                | 50,661,000 |   |                  | $ | 54,190,000 |  
|                                                                                                                                    |  |                  |            |   |                  |   |            |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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Premier Exhibitions, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(unaudited)



|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|----------------------------------------------------------------------------------------- |  | ------------------------------- | ---------- | ---- | ------------------------------ | ---------- | ---- |  | ---- | ---------- |  | - | ---------- | -
|                                                                                          |  | Three Months Ended November 30, |            |      | Nine Months Ended November 30, |           
|                                                                                          |  | 2007                            |            | 2008 |                                |            | 2007 |  | 2008 |           
|Revenue:                                                                                  |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Exhibition revenue                                                                        |  | $                               | 16,311,000 |      | $                              | 11,285,000 |      |  | $    | 42,806,000 |  | $ | 37,180,000 |  
|Merchandise and other                                                                     |  |                                 | 410,000    |      |                                | 2,143,000  |      |  |      | 1,380,000  |  |   | 6,575,000  |  
|Sale of coal                                                                              |  |                                 | 14,000     |      |                                | 28,000     |      |  |      | 77,000     |  |   | 34,000     |  
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Total revenue                                                                             |  |                                 | 16,735,000 |      |                                | 13,456,000 |      |  |      | 44,263,000 |  |   | 43,789,000 |  
|                                                                                          |  |                                 |            |     
|Cost of revenue:                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Exhibition costs                                                                          |  |                                 | 5,172,000  |      |                                | 7,348,000  |      |  |      | 12,171,000 |  |   | 21,146,000 |  
|Cost of merchandise sold                                                                  |  |                                 | 29,000     |      |                                | 1,250,000  |      |  |      | 228,000    |  |   | 2,744,000  |  
|Cost of coal sold                                                                         |  |                                 | 4,000      |      |                                | 2,000      |      |  |      | 15,000     |  |   | 4,000      |  
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Total cost of revenue (exclusive of depreciation and amortization shown separately below) |  |                                 | 5,205,000  |      |                                | 8,600,000  |      |  |      | 12,414,000 |  |   | 23,894,000 |  
|                                                                                          |  |                                 |            |     
|Gross profit                                                                              |  |                                 | 11,530,000 |      |                                | 4,856,000  |      |  |      | 31,849,000 |  |   | 19,895,000 |  
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Operating expenses:                                                                       |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|General and administrative                                                                |  |                                 | 6,934,000  |      |                                | 6,429,000  |      |  |      | 12,912,000 |  |   | 19,164,000 |  
|Depreciation and amortization                                                             |  |                                 | 614,000    |      |                                | 1,273,000  |      |  |      | 1,668,000  |  |   | 3,691,000  |  
|Loss on sale of fixed assets                                                              |  |                                 |           |      |                                |           |      |  |      |           |  |   | 5,000      |  
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Total operating expenses                                                                  |  |                                 | 7,548,000  |      |                                | 7,702,000  |      |  |      | 14,580,000 |  |   | 22,860,000 |  
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Income (loss) from operations                                                             |  |                                 | 3,982,000  |      |                                | (2,846,000 | )    |  |      | 17,269,000 |  |   | (2,965,000 | )
|                                                                                          |  |                                 |            |     
|Other income and expenses:                                                                |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Interest income                                                                           |  |                                 | 289,000    |      |                                | 46,000     |      |  |      | 736,000    |  |   | 209,000    |  
|Interest expense                                                                          |  |                                 |           |      |                                | (1,000     | )    |  |      |           |  |   | (3,000     | )
|Other income                                                                              |  |                                 |           |      |                                | 94,000     |      |  |      | 10,000     |  |   | 93,000     |  
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Total other income and expenses                                                           |  |                                 | 289,000    |      |                                | 139,000    |      |  |      | 746,000    |  |   | 299,000    |  
|                                                                                          |  |                                 |            |     
|Income (loss) before provision for income taxes                                           |  |                                 | 4,271,000  |      |                                | (2,707,000 | )    |  |      | 18,015,000 |  |   | (2,666,000 | )
|                                                                                          |  |                                 |            |     
|Provision for (benefit) from income taxes                                                 |  |                                 | 1,541,000  |      |                                | (865,000   | )    |  |      | 6,485,000  |  |   | (851,000   | )
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Net income (loss)                                                                         |  | $                               | 2,730,000  |      | $                              | (1,842,000 | )    |  | $    | 11,530,000 |  | $ | (1,815,000 | )
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Net income (loss) per share:                                                              |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Basic income (loss) per common share                                                      |  | $                               | 0.09       |      | $                              | (0.06      | )    |  | $    | 0.39       |  | $ | (0.06      | )
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Diluted income (loss) per common share                                                    |  | $                               | 0.08       |      | $                              | (0.06      | )    |  | $    | 0.35       |  | $ | (0.06      | )
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Shares used in basic per share calculations                                               |  |                                 | 30,047,900 |      |                                | 29,291,666 |      |  |      | 29,660,719 |  |   | 29,253,863 |  
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Shares used in diluted per share calculations                                             |  |                                 | 34,097,129 |      |                                | 29,291,666 |      |  |      | 33,303,780 |  |   | 29,253,863 |  
|                                                                                          |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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Premier Exhibitions, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(unaudited)



|                                                                                         |  |                                |            |   |      |   |             |  
|---------------------------------------------------------------------------------------- |  | ------------------------------ | ---------- | - | ---- | - | ----------- | -
|                                                                                         |  | Nine Months Ended November 30, |           
|                                                                                         |  | 2007                           |            |   | 2008 |  
|Cash flows from operating activities:                                                    |  |                                |            |   |      |   |             |  
|Net income (loss)                                                                        |  | $                              | 11,530,000 |   |      | $ | (1,815,000  | )
|                                                                                         |  |                                |            |   |      |   |             |  
|Adjustments to reconcile net income (loss) to net cash provided by operating activities: |  |                                |            |   |      |   |             |  
|Depreciation and amortization                                                            |  |                                | 1,668,000  |   |      |   | 3,691,000   |  
|Stock based compensation                                                                 |  |                                | 3,295,000  |   |      |   | (400,000    | )
|Provision for doubtful accounts                                                          |  |                                | 106,000    |   |      |   | 476,000     |  
|Excess of tax (benefit) expense on exercise of stock options                             |  |                                | (1,384,000 | ) |      |   | 30,000      |  
|Changes in operating assets and liabilities:                                             |  |                                |            |   |      |   |             |  
|(Increase) in accounts receivable                                                        |  |                                | (1,149,000 | ) |      |   | (4,106,000  | )
|(Increase) in merchandise inventories                                                    |  |                                | (115,000   | ) |      |   | (1,357,000  | )
|(Increase) in deferred income taxes                                                      |  |                                | (168,000   | ) |      |   | (122,000    | )
|(Increase) decrease in prepaid expenses and other assets                                 |  |                                | (1,082,000 | ) |      |   | 660,000     |  
|(Increase) decrease in income tax (receivable) payable                                   |  |                                | 3,739,000  |   |      |   | (3,271,000  | )
|(Increase) decrease in deferred revenue                                                  |  |                                | (536,000   | ) |      |   | 685,000     |  
|Increase in accounts payable and accrued liabilities                                     |  |                                | 226,000    |   |      |   | 3,938,000   |  
|                                                                                         |  |                                |            |   |      |   |             |  
|Total adjustments                                                                        |  |                                | 4,600,000  |   |      |   | 224,000     |  
|                                                                                         |  |                                |            |   |      |   |             |  
|Net cash provided by (used in) operating activities                                      |  |                                | 16,130,000 |   |      |   | (1,591,000  | )
|                                                                                         |  |                                |            |   |      |   |             |  
|Cash flows used in investing activities:                                                 |  |                                |            |   |      |   |             |  
|Proceeds from Carpathia receivable                                                       |  |                                |           |   |      |   | 2,500,000   |  
|Purchases of property and equipment                                                      |  |                                | (3,465,000 | ) |      |   | (8,974,000  | )
|Purchase of exhibition licenses                                                          |  |                                | (2,878,000 | ) |      |   | (1,908,000  | )
|Purchase of subrogation rights                                                           |  |                                | (250,000   | ) |      |   |            |  
|Acquisition, net of cash received                                                        |  |                                |           |   |      |   | (2,101,000  | )
|Net increase (decrease) in marketable securities                                         |  |                                | 10,000     |   |      |   | (218,000    | )
|Purchase of certificate of deposit                                                       |  |                                | (1,000,000 | ) |      |   |            |  
|                                                                                         |  |                                |            |   |      |   |             |  
|Net cash used in investing activities                                                    |  |                                | (7,583,000 | ) |      |   | (10,701,000 | )
|                                                                                         |  |                                |            |   |      |   |             |  
|Cash flows from financing activities:                                                    |  |                                |            |   |      |   |             |  
|Proceeds from revolving line of credit                                                   |  |                                |           |   |      |   | 3,969,000   |  
|Payments on revolving line of credit                                                     |  |                                |           |   |      |   | (3,542,000  | )
|Proceeds from option and warrant exercises                                               |  |                                | 2,391,000  |   |      |   | 229,000     |  
|Excess tax benefit (expense) on exercise of stock options                                |  |                                | 1,384,000  |   |      |   | (30,000     | )
|                                                                                         |  |                                |            |   |      |   |             |  
|Net cash provided by financing activities                                                |  |                                | 3,775,000  |   |      |   | 626,000     |  
|                                                                                         |  |                                |            |   |      |   |             |  
|Effects of exchange rate changes on cash and cash equivalents                            |  |                                | (133,000   | ) |      |   | (51,000     | )
|                                                                                         |  |                                |            |   |      |   |             |  
|Net increase (decrease) in cash and cash equivalents                                     |  |                                | 12,189,000 |   |      |   | (11,717,000 | )
|Cash and cash equivalents at beginning of period                                         |  |                                | 16,811,000 |   |      |   | 16,426,000  |  
|                                                                                         |  |                                |            |   |      |   |             |  
|Cash and cash equivalents at end of period                                               |  | $                              | 29,000,000 |   |      | $ | 4,709,000   |  
|                                                                                         |  |                                |            |   |      |   |             |  
|Supplemental disclosure of cash flow information:                                        |  |                                |            |   |      |   |             |  
|Cash paid during the period for taxes                                                    |  | $                              | 2,433,000  |   |      | $ | 1,529,000   |  
|                                                                                         |  |                                |            |   |      |   |             |  
|Supplemental disclosure of non-cash investing and financing activities:                  |  |                                |            |   |      |   |             |  
|Cashless exercise of stock options                                                       |  | $                              | (41,000    | ) |      | $ |            |  
|                                                                                         |  |                                |            |   |      |   |             |  
|Supplemental disclosure of non-cash investing and financing activities:                  |  |                                |            |   |      |   |             |  
|Unrealized loss on marketable securities                                                 |  | $                              | 10,000     |   |      | $ |            |  
|                                                                                         |  |                                |            |   |      |   |             |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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##### Table of Contents

PREMIER EXHIBITIONS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring
items, which in the opinion of management, are necessary for a fair statement of the results of operations for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for the full year or
for any future period.

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make
estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including
those related to uncollectible receivables, the useful lives of long-lived assets including property and equipment, goodwill, income taxes and contingencies. In addition, the Company uses assumptions when employing the Black-Scholes option valuation
model to estimate the fair value of stock options granted. The Company bases its estimates of the carrying value of certain assets and liabilities on historical experience and on various other assumptions that are believed to be reasonable under the
circumstances, when these carrying values are not readily available from other sources. Actual results may differ from these estimates.

These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Companys Annual Report on Form 10-K for the year ended
February 29, 2008.

2. Recent Accounting Pronouncements

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards, (SFAS) SFAS No. 157, Fair Value Measurements.
SFAS No. 157 provides guidance for measuring the fair value of certain assets and liabilities. It requires additional disclosures related to the extent to which companies measure assets and liabilities at fair value, the information used to
measure fair value, and the effect of fair value measurements on earnings. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. The adoption of SFAS No. 157 for financial assets and liabilities on
March 1, 2008 did not have a material impact on the Companys consolidated results of operations and financial condition.

In
February 2008, the FASB issued SFAS No. 157-1. SFAS No. 157-1 amends the scope of FASB Statement No. 157 to exclude FASB Statement No. 12, Accounting for Leases, and other accounting standards that address fair value
measurements for purposes of lease classifications or measurement under FASB Statement No. 13. SFAS No. 157-1 is effective on initial adoption of FASB Statement No. 157. The scope exception does not apply to assets acquired and
liabilities assumed in a business combination that are required to be measures at fair value under SFAS No. 141, Business Combinations, or SFAS No. 141R, regardless of whether those assets and liabilities are related to leases.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial
Liabilities  including an Amendment of SFAS No. 115, which permits an entity to measure many financial assets and financial liabilities at fair value that are not currently required to be measured at fair value. Entities
that elect the fair value option will report unrealized gains and losses in earnings at each subsequent reporting date. The fair value option may be elected on an instrument-by-instrument basis, with few exceptions. SFAS No. 159 amends previous
guidance to extend the use of the fair value option to available-for-sale and held-to-maturity securities. SFAS No. 159 also establishes presentation and disclosure requirements to help financial statement users understand the effect of the
election. SFAS No. 159 is effective as of the beginning of the first fiscal year beginning after November 15, 2007. The adoption of SFAS No. 159 as of March 31, 2008 did not impact the Companys consolidated results of
operations and financial condition, as the Company did not elect to fair value any of the eligible assets or liabilities.



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In December 2007, FASB issued SFAS No. 141 (revised 2007), Business Combinations
(SFAS 141R). SFAS 141R established principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non-controlling interest in the
acquiree and the goodwill acquired. SFAS 141R also established disclosure requirements to enable the evaluation of the nature and financial effects of the business combination. SFAS 141R will apply prospectively to any business combination which is
effective for fiscal years beginning after December 15, 2008. Once adopted, the Company will assess the impact of SFAS 141R upon the occurrence of a business combination.

In December 2007, FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements-an amendment of Accounting Research
Bulletin No. 51. SFAS No. 160 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to the
non-controlling interest, changes in parents ownership interest, and the valuation of retained non-controlling equity investments when a subsidiary is deconsolidated. SFAS No. 160 also established disclosure requirements that clearly
identify and distinguish between the interests of the parent and the interests of the non-controlling owners. SFAS No. 160 is effective for fiscal years beginning after December 15, 2008. The Company is currently evaluating the potential
impact, if any, of the adoption of SFAS No. 160 on its consolidated financial statements.

In December 2007, the FASB ratified EITF
Issue No. 07-1, Accounting for Collaborative Arrangements.(EITF07-1), which defines collaborative arrangements and establishes reporting requirements for transactions between participants in a collaborative arrangement
and between participants in the arrangement and third parties. EITF 07-1 also establishes the appropriate income statement presentation and classification for joint operating activities and payments between participants, as well as the sufficiency
of the disclosures related to these arrangements. EITF 07-1 is effective for fiscal years beginning after December 15, 2008. EITF 07-1 shall be applied using a modified version of retrospective transition for those arrangements in place at the
effective date. Companies are required to report the effects of applying EITF-07-1 as a change in accounting principle through retrospective application to all prior periods presented for all arrangements existing as of the effective date, unless it
is impracticable to apply the effects the change retrospectively. The Company is in the process of determining what effect, if any the adoption of EITF 07-1 will have on its consolidated results of operations and financial condition.

In March 2008, FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities. SFAS No. 161 is intended
to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entitys financial position, financial performance and cash flows.
SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The Company is currently evaluating the potential impact, if any, of the
adoption of SFAS No. 161 on its consolidated financial statements.

In May 2008, FASB issued SFAS No. 162, The Hierarchy of
Generally Accepted Accounting Principles. SFAS No. 162 mandates the GAAP hierarchy resides in the accounting literature as opposed to the audit literature, which has the practical impact of elevating the FASB Statements of Financial
Accounting Concepts in the GAAP hierarchy. SFAS No. 162 will become effective 60 days following SEC approval. The Company does not believe SFAS No. 162 will have an impact on its consolidated financial statements.

3. Merchandise Inventories

The Companys
merchandise inventories are carried at the lower of cost or market. The Company estimates reserves for inventory obsolescence and shrinkage based on managements judgment of future realization. All inventories are valued using the first-in,
first-out method.

4. Earnings Per Share Data

Basic per share amounts exclude dilution and are computed using the weighted average number of common shares outstanding for the period. Unless the effects are anti-dilutive, diluted per share amounts reflect the potential reduction in
earnings per share that



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could occur if equity based awards were exercised or converted into common stock. For the three and nine months ended November 30, 2008 and 2007,
respectively, basic per share amounts are calculated using the weighted average number of common shares outstanding during the respective periods.

For the three and nine months ended November 30, 2008 and 2007, respectively, diluted per share amounts are calculated using the weighted average number of common shares outstanding during the respective period and, if dilutive,
potential common shares outstanding during the period. Potential common shares are determined using the treasury stock method and include common shares issuable upon exercise of outstanding stock options and warrants. The following table sets forth
the computation of basic and diluted net income per share (unaudited):



|                                              |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|--------------------------------------------- |  | ------------------------------- | ---------- | ---- | ------------------------------ | ---------- | ---- |  | ---- | ---------- |  | - | ---------- | -
|                                              |  | Three Months Ended November 30, |            |      | Nine Months Ended November 30, |           
|                                              |  | 2007                            |            | 2008 |                                |            | 2007 |  | 2008 |           
|Numerator:                                    |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Net income (loss)                             |  | $                               | 2,730,000  |      | $                              | (1,842,000 | )    |  | $    | 11,530,000 |  | $ | (1,815,000 | )
|                                              |  |                                 |            |     
|Denominator:                                  |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Basic weighted-average shares outstanding     |  |                                 | 30,047,900 |      |                                | 29,291,666 |      |  |      | 29,660,719 |  |   | 29,253,863 |  
|Effect of dilutive stock options and warrants |  |                                 | 4,049,229  |      |                                |           |      |  |      | 3,643,061  |  |   |           |  
|                                              |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Diluted weighted-average shares outstanding   |  |                                 | 34,097,129 |      |                                | 29,291,666 |      |  |      | 33,303,780 |  |   | 29,253,863 |  
|                                              |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Net income ( loss) per share:                 |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Basic                                         |  | $                               | 0.09       |      | $                              | (0.06      | )    |  | $    | 0.39       |  | $ | (0.06      | )
|                                              |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  
|Diluted                                       |  | $                               | 0.08       |      | $                              | (0.06      | )    |  | $    | 0.35       |  | $ | (0.06      | )
|                                              |  |                                 |            |      |                                |            |      |  |      |            |  |   |            |  

Common stock options were not included in the diluted earnings per share computation because the
options exercise price was greater that the average market price of the common shares for the periods presented. The number of shares not included was 4,339,232 and 0 for the three months ended November 30, 2008 and 2007, respectively. The
number of shares not included was 2,650,943 and 0 for the nine months ended November 30, 2008 and 2007, respectively.

5. Equity Transactions

The Company recorded stock based compensation expense related to stock options and restricted stock granted to the Companys employees
and warrants issued to consultants of $684,000 (of which approximately $400,000 was from the termination without cause for one employee) and $2,378,000 during the three months ended November 30, 2008 and 2007, respectively. The Company recorded
stock based compensation expense related to stock options and restricted stock granted to the Companys employees and warrants issued to consultants of $3,781,000 and $3,295,000 for the nine months ended November 30, 2008 and 2007,
respectively. The Company recorded forfeitures of $65,000 with respect to stock options and restricted stock granted to an employee who resigned during the three months ended November 30, 2008. The Company also recorded forfeitures of
$4,180,000 with respect to stock options and restricted stock granted to the Companys employees and directors who resigned during the nine months ended November 30, 2008, which was partially offset as the result of a modification to the
stock option agreement for one of the departing officers that totaled approximately $300,000. These amounts are included in the Companys general and administrative expenses for the three and nine month periods ended November 30, 2008 and
2007, respectively.

During the three months ended November 30, 2008, the Company granted no warrants, stock options or restricted
stock. During the nine months ended November 30, 2008, the Company issued 300,000 warrants at a fair value of $4.57 per unit with an average



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vesting period of five years. During the same nine month period ended November 30, 2007, the Company issued 40,000 stock options with a fair value of
$3.22 per option with an average vesting period of three years. The Company also granted 70,000 shares of restricted stock at a fair value of $4.78 per share during the nine months ended November 30, 2008. During the three and nine month
periods ended November 30, 2007, the Company granted 700,000 shares of restricted stock and 1,135,000 stock options.

During the nine
months ended November 30, 2008, the Company issued 50,000 shares and received $50,000 for the exercises of outstanding warrants to purchase common stock at an exercise price of $1.00 per share. During the nine months ended November 30,
2007, the Company issued 918,882 shares and received approximately $2,114,000 for the exercises of warrants to purchase shares of common stock at exercise prices ranging from $1.50 to $2.50 per share.

The Company issued 6,325 shares of common stock (net of 2,009 shares withheld for the employee taxes) for restricted stock that vested during the three
and nine months ended November 30, 2008. No shares were issued for the vesting of restricted stock for the three and nine months ended November 30, 2007.

During the nine months ended November 30, 2008, the Company received approximately $179,000 for the exercise of 83,167 options to purchase shares of common stock at an exercise price of $2.15 per share. During
the nine months ended November 30, 2007, the Company received approximately $277,000 for the exercise of 282,280 options to purchase shares of common stock at exercise prices ranging from $0.28 to $3.95 per share.

6. Legal Proceedings

The Company is involved in
litigation from time to time in the regular course of its business. A summary of developments in the Companys material legal proceedings are described below.

On March 25, 2008, the United States District Court for the Eastern District of Virginia granted the U.S. government permission to file an amicus curie (friend of the court) brief in response to the
Companys wholly owned subsidiary, R.M.S. Titanic, Inc.s November 30, 2007 motion for an interim salvage award. The U.S. government took the position that the issuance of an in specie (in kind) salvage award to R.M.S. Titanic,
with limitations, could be an appropriate mechanism to satisfy the salvage award and could help ensure that the Titanic artifacts are conserved and curated in an intact collection that remains available to the public. On April 15, 2008, the
District Court entered an order requesting that R.M.S. Titanic collaborate with the U.S. government and propose suggested covenants that would be included in an in specieaward. The order also outlined a process for further discussion
pertaining to such covenants, should the court decide to issue an in specie award. On June 12,2008 R.M.S. Titanic submitted covenants that may be included in an in specieaward, should the District Court determine one is
appropriate, in accordance with the April 15, 2008 order made by the District Court. After engaging in consultative discussions with the U.S. government over several months, on September 15, 2008, R.M.S. Titanic submitted revised covenants
and restrictions. On October 14, 2008, the U.S. government filed an amicus response to R.M.S. Titanics proposed revised covenants, and by leave of the District Court granted on October 31, 2008, R.M.S. Titanic in turn filed a reply
brief on November 12, 2008. On November 18, 2008, R.M.S. Titanic attended a status conference at the District Court. At the conclusion of the hearing, the District Court asked for certain additional submissions from R.M.S. Titanic and the
U.S. government, which were provided. The District Court also indicated it would complete its review of the proposed revised covenants and conditions and any final areas of disagreement between the U.S. government and R.M.S. Titanic, and
likely issue its final version and order in the future. There have not been any further decisions or announcements from the District Court since the November 18 hearing.

On April 28, 2006, Stefano Arts filed an action against the Company entitled Premier Exhibitions, Inc. v. Stefano Artsin the State
Court of Fulton County, State of Georgia. Stefano Arts alleges that the Company breached a contract which allegedly calls for it to pay to Stefano Arts moneys generated from our human anatomy exhibition in Tampa, Florida and additional moneys
generated from the Companys human anatomy exhibition in New York City. The Company continues to aggressively defend itself but it cannot predict the outcome of this matter. A hearing on the Companys motion for summary
judgment, which asks the court to grant the Company judgment as a matter of law, has been set for February 5, 2009.



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In May, 2006 the Company contracted with the Tropicana Resort and Casino in Las Vegas (the
Tropicana) for the presentation of a Bodies Exhibition and a Titanic exhibition at the Tropicana. On May 5, 2008, while both of the exhibitions were still open to the public, the Tropicana filed for Chapter 11 Bankruptcy in the
United States Bankruptcy Court for the District of Delaware. Purportedly as part of its bankruptcy, the Tropicana retained from Premier $283,000 in proceeds from ticket sales for the exhibitions. On June 24, 2008, Premier filed a complaint
against Tropicana seeking to recover these moneys, which it believes should not be part of the Tropicana Bankruptcy.

7. Exclusive License Agreement

On November 28, 2007, the Company entered into an exclusive right, license and opportunity agreement (the Original
Agreement) with Live Nation, Inc. (Live Nation) under which the Company would co-present twelve human anatomy exhibitions with Live Nation in twelve geographic territories anywhere in the world, except for North America, China and
certain other limited geographic locations (the Exclusive Territory). With respect to each jointly presented exhibition, the Company is responsible for exhibition design, installation and licensing, including the provision of expertise,
exhibitry and specimens and Live Nation is responsible for marketing, public relations and exhibition operations and security. In consideration, the Company received $6,000,000 payment from Live Nation. Also, the Company agreed to split the revenues
from the exhibition with Live Nation after reimbursement of recoupable expenses. Additionally, pursuant to the Original Agreement, the Company and Live Nation each had a unilateral right to exercise two additional options to grant Live Nation the
exclusive right to present twelve additional human anatomy exhibitions within the Exclusive Territory. Under the Original Agreement, upon the exercise of each such option, the Company would receive a payment from Live Nation of $6,000,000. The
consideration from Live Nation of $6,000,000 is included in revenue for the three and nine months period ended November 30, 2007.

In
September 2008, Live Nation assigned its rights under the Original Agreement to Soon To Be Named Corporation (STBN), subject to the Companys consent. The Company provided its consent to such assignment on November 28, 2008.
Michael Cohl, formerly a director and executive officer of Live Nation, is a principal of STBN.

On the same day, the Company entered into
a First Amendment to the Original Agreement (the First Amendment) with STBN which exercises and amends the first option under the Original Agreement by granting STBN an exclusive license to present eight additional human anatomy
exhibitions in the Exclusive Territory for an 18 month period commencing on the date on which the last remaining human anatomy exhibit under the Original Agreement is open to the public. In connection with the exercise of the First Option, the
Company will receive from STBN consideration of $4,000,000, which amount is included in revenue as of November 30, 2008. Additionally, under the First Amendment, if the second option is exercised, then STBN would be granted an additional
exclusive license to present a further eight human anatomy exhibits for an 18 month period commencing after the expiration of the term of the license granted pursuant to the First Option and the Company will receive from STBN additional
consideration of $4,000,000.

8. Goodwill and Other Intangible Assets

The Company accounts for goodwill and other intangible assets pursuant to SFAS No. 142, Goodwill and Other Intangible Assets. Under this pronouncement, the Company will perform an impairment test at
least annually. On March 27, 2008, the Company acquired MGR Entertainment (MGR), a full-service entertainment merchandising company, for $2,101,000, net of cash received. This resulted in the Company recording additional goodwill of
$847,000. This purchase price included debt of approximately $1,500,000 related primarily to artist advances. Effective December 29, 2008, the Company sold certain assets and liabilities of MGR. See Note 11, Subsequent Events.



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The following is a summary of the changes in the carrying amount of goodwill for the nine months ended
November 30, 2008:



|                                |  |   |          
|------------------------------- |  | - | ---------
|Balance as of February 29, 2008 |  | $ | 1,377,000
|Goodwill acquired               |  |   | 847,000  
|                                |  |   |          
|Balance as of November 30, 2008 |  | $ | 2,224,000
|                                |  |   |          

The Company will perform its annual test for goodwill impairment in the fourth quarter of the
fiscal year ending February 28, 2009.

9. Post Employment Benefits

During the nine months ended November 30, 2008, certain of the Companys executives and Directors tendered their resignations. The Company recorded
$1,660,000 as a liability in the month of August 2008 in connection with such resignations and in connection with a termination without cause. At November 30, 2008, $953,000 of this accrual remains to be paid. Additionally, 1,125,000 stock
options and 625,000 shares of restricted stock were forfeited in connection with such resignations and termination without cause. The Company reversed $4,180,000 of previously recognized stock compensation as a result of the forfeitures. This
reversal of stock based compensation was partially offset as the result of a modification to the stock option agreement for one of the departing officers that totaled approximately $300,000.

10. Loan Agreement

On September 26, 2008, the
Company entered into a First Amendment to Loan Agreement with Bank of America, N.A. (the First Amendment). The First Amendment amends, in accordance with its terms, that certain Loan Agreement made as of October 4, 2007 between the
Company and Bank of America and extends such agreement to September 26, 2009 (the Loan Agreement). The Loan Agreement, as amended by the First Amendment, provides the Company with a $10,000,000 revolving line of credit with Bank of
America. At the Companys request, such credit limit may be increased up to $25,000,000, provided that Bank of America consents to such increase.

At the Companys option, amounts outstanding under the Loan Agreement, as amended, bear interest at (i) the greater of Bank of Americas prime rate or the federal funds rate, plus a margin (as defined
below); or (ii) the LIBOR rate, plus a margin. The amount of the margin will be based upon the Companys leverage ratio (which is the ratio of total funded debt to earnings before interest, tax, depreciation and amortization
(EBITDA), as each term is defined in the Loan Agreement). If the Companys leverage ratio is less than or equal to 1 to 1, the margin will be 2.50%. If the Companys leverage ratio is greater than 1 to 1, the margin will be
3.00%. The Loan Agreement requires the Company to maintain a leverage ratio not to exceed 1.5 to 1 and a basic fixed charge coverage ratio (which is the ratio of (i) the sum of EBITDA minus the sum of taxes and dividends, to (ii) the sum
of interest expense, the current portion of long term debt and the current portion of capitalized lease obligations) of at least 2 to 1. In addition, the Company is required to pay a facility fee on the unused portion of the Loan Agreement of 0.25%
if the Companys leverage ratio is less than 1 to 1 and 0.50% if the Companys leverage ratio is greater than 1 to 1, which amount is payable quarterly in arrears. Interest payments under the Loan Agreement also must be made not less
frequently than quarterly. The Loan Agreement also provides that the Company is required to pay Bank of America an annual fee in an amount equal to 0.50% of the maximum amount of the Loan Agreement at the time such fee is due.

Upon termination of the Loan Agreement, the Company may request that Bank of America convert all amounts then outstanding into a three year term loan. In
the event that Bank of America consents to such conversion request, the Company will be required to amortize the outstanding borrowings under the Loan Agreement and make quarterly payments of principal and interest. Such term



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loan will also require the Company to make annual pre-payments equal to 50% the Companys excess cash flow (which is EBITDA minus the sum of interest
expense, taxes, dividends, capital expenditures, principal payments of long term debt and payments of capitalized lease obligations) in the event the Companys leverage ratio is greater than 1 to 1 during any year in which amounts under such
term loan remain outstanding. The Loan Agreement is secured by all of the Companys assets, including its equity interests in its subsidiaries, and is also guaranteed by the Companys subsidiaries.

The Company borrowed as much as $3,969,000 from this revolving line of credit and had an outstanding balance of $427,000 as of November 30, 2008
which is included in accounts payable and accrued liabilities. Based upon actual results over the past four fiscal quarters, as of November 30, 2008, the Company has access to approximately $7,100,000 under the revolving loan agreement. The
Company is in compliance with the terms of the Loan Agreement as of November 30, 2008.

Should the Companys performance not
improve, the amount available for borrowing under the revolving credit facility will continue to decrease, as the amounts available to the Company for borrowing under the revolving loan agreement are based on actual results for a trailing four
quarter period. Although the Company did not have a balance due under the revolving loan agreement as of January 8, 2009, the Company anticipates that it may require additional capital resources in fiscal 2010 in excess of the amount available to
the Company under the revolving loan agreement, despite the expected reduction in the Company operating and overhead costs in the coming months. Should the amounts available to the Company under its revolving loan agreement with Bank of America be
reduced further or should Bank of America decide not to advance funds under such agreement, the Company would have to seek funding from other sources. The Company can not provide assurance that it will be able to raise all or a portion of the funds
it may require.

11. Cash Flow Restatement

During the third quarter management determined that amounts related to the Carpathia receivable which had been classified as operating cash flows should have been classified as investing cash flows. See below the restated amounts related to
the first quarter ending May 31, 2008 and the second quarter ending August 31, 2008:



|                                                                          |  |   |            |  
|------------------------------------------------------------------------- |  | - | ---------- | -
|Cash flows from operations as originally reported, as of May 31, 2008     |  | $ | 1,227,000  |  
|Carpathia receivable                                                      |  |   | (2,500,000 | )
|                                                                          |  |   |            |  
|Restated cash flows from operations, as of May 31, 2008                   |  | $ | (1,273,000 | )
|                                                                          |  |   |            |  
|                                                                          | 
|Cash flows from investments as originally reported, as of May 31, 2008    |  | $ | (4,185,000 | )
|Carpathia receivable                                                      |  |   | 2,500,000  |  
|                                                                          |  |   |            |  
|Restated cash flows from investments, as of May 31, 2008                  |  | $ | (1,685,000 | )
|                                                                          |  |   |            |  
|                                                                          | 
|Cash flows from operations as originally reported, as of August 31, 2008  |  | $ | 519,000    |  
|Carpathia receivable                                                      |  |   | (2,500,000 | )
|                                                                          |  |   |            |  
|Restated cash flows from operations, as of August 31, 2008                |  | $ | (1,981,000 | )
|                                                                          |  |   |            |  
|                                                                          | 
|Cash flows from investments as originally reported, as of August 31, 2008 |  | $ | (9,056,000 | )
|Carpathia receivable                                                      |  |   | 2,500,000  |  
|                                                                          |  |   |            |  
|Restated cash flows from investments, as of August 31, 2008               |  | $ | (6,556,000 | )
|                                                                          |  |   |            |  

The above reclassifications did not impact the Companys condensed consolidated balance sheets, condensed
consolidated statements of operations, earnings per share or total cash flows for the Company.

12. Other Matters

Sellers Capital LLC, the Companys largest shareholder, has threatened to sue certain of the Companys independent directors who serve on a
special committee of the Companys Board of Directors. Messrs. Sellers and Hugh Sam, who serve on the Companys board of directors, are affiliates of Sellers Capital LLC. The Company has entered into indemnification agreements with each
member of the special committee and is obligated to indemnify and hold harmless each member of such committee made a party to or otherwise involved in certain legal proceedings as a result of actions related to each members service as a
director. As of January 8, 2009, the Company is not aware of any formal claim or proceeding brought by Sellers Capital LLC against such independent directors.

13. Subsequent Events

On December 29, 2008, the Company entered into an agreement with the former owner of MGR
Entertainment, Inc. (MGR) for the sale of selected assets and liabilities of the Companys merchandising operations. These assets and liabilities are focused on the live music business and were purchased in March, 2008. This aspect
of the Companys merchandising business is not consistent with the Companys current business strategy, requires ongoing capital commitments and achieves very low operating margins. The Company will continue to focus on merchandising
activities at all of our exhibition locations to increase revenue per attendee and our margins on this activity.

As a result of this
transaction, the Company expects to record a net book loss ranging from approximately $960,000 to $1,060,000, which includes the write-off of certain intangible assets net of accumulated amortization in the approximate amount of $160,000 during its
fourth quarter. This transaction will also require the Company to test the goodwill for impairment which could result in an impairment charge. The amount of goodwill associated with this reporting unit is $847,000. See Note 8 Goodwill and
Other Intangible Assets.



|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
|------- | --------------------------------------------------------------------------------------

Forward-Looking Statements

Except for historical
information contained herein, this Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which involve certain risks and uncertainties. Our actual results or
outcomes may differ materially from those anticipated. Important facts that we believe might cause such differences are discussed in the cautionary statements accompanying the forward-looking statements as well as in the risk factors discussed in
our Annual Report on Form 10-K for the fiscal year ended February 29, 2008, in our Quarterly Report on Form 10-Q for the quarter ended August 31, 2008, and herein. Such statements consist of any statement other than a recitation of
historical fact and can be identified by the use of forward looking terminology such as may, expect, will, anticipate, estimate, or continue or the negative thereof or other
variations thereon or comparable terminology. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Although we believe that the
assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore, there can be no assurance that the forward-looking statements will prove to be accurate.



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Overview

The following discussion provides information designed to assist investors in understanding our financial condition and results of operations, and should be read in conjunction with the financial statements and related notes appearing
elsewhere herein. The information discussed below should also be read in conjunction with: (i) the section entitled Managements Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on
Form 10-K for the year ended February 29, 2008, as filed with the SEC, which contains additional information concerning our condensed consolidated financial statements; and (ii) the section of such Annual Report on Form 10-K entitled
Risk Factors; and (iii) the section entitled Risk Factors in our Quarterly Report on Form 10-Q for the quarter ended August 31, 2008; and (iv) the Part II, Item 1A of this report, entitled Risk
Factors. We refer to our fiscal year ended February 28, 2009 as fiscal 2009 and our fiscal year ended February 28, 2008 as fiscal 2008.

We are in the business of developing and touring museum quality exhibitions. We generate income from our exhibitions primarily through ticket sales,
third-party licensing, sponsorships and merchandise sales.

Our two primary exhibition offerings relate to the artifacts from the Titanic
shipwreck and to the workings of human anatomy. We currently have the ability to operate seven concurrent Titanic exhibitions, which are known as Titanic: The Artifact Exhibition, and Titanic Aquatic. In addition we currently
have the ability to present seventeen concurrent human anatomy exhibitions, which are known as BodiesThe Exhibition, Bodies Revealed and Our Body: The Universe Within.

We have further diversified the scope of our exhibition offerings to include exhibitions of sports memorabilia entitled Sports Immortals, The
Traveling Exhibition, exhibitions exploring a world without sight entitled Dialog in the Dark and exhibitions regarding all aspects of the Star Trek television and movie series entitled Star Trek The Exhibition. We
acquired the rights to offer these exhibitions pursuant to long-term licensing agreements.

Our Exhibitions

We presently operate and/or present and promote or have plans to operate and/or present and promote five different types of exhibitions:



| |  |  | Titanic: The Artifact Exhibition, and Titanic Aquatic
| | - |  | ---------------------------------------------------------



| |  |  | BodiesThe Exhibition, Bodies Revealed and Our Body: The Universe Within;
| | - |  | -------------------------------------------------------------------------------



| |  |  | Sports Immortals, The Traveling Exhibition;
| | - |  | ---------------------------------------------



| |  |  | Dialog in the Dark; and
| | - |  | -------------------------



| |  |  | Star Trek The Exhibition.
| | - |  | ---------------------------

Titanic

The R.M.S. Titanic has continued to captivate the thoughts and imaginations of millions of people throughout
the world since 1912 when she struck an iceberg and sank in the North Atlantic Ocean on her maiden voyage. Through our explorations, we have obtained and are in possession of the largest collection of artifacts, data, information, images, and
cultural materials associated with the shipwreck which we present to the public through our exhibitions. Our Titanic exhibitions have been presented in more than 60 venues throughout the world, including in the U.S., Canada, Germany, Norway, France,
Greece, Japan, Switzerland, Chile, Argentina, China, Mexico, Hungary, South Korea and England. During our quarter ended November 30, 2008, we presented our Titanic exhibitions at eleven separate venues.



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##### Table of Contents

BodiesThe Exhibition, Bodies Revealed and Our Bodies: The
Universe Within

We presently have the rights to multiple human anatomy sets, each of which contains a collection of whole
human body specimens plus single human organs and body parts, which are known as Bodies Revealed, BodiesThe Exhibition, and Our Body: The Universe Within. We acquired the rights to produce these exhibitions
through separate exhibition agreements.

These specimens are assembled into anatomy-based exhibitions featuring preserved human bodies,
organs and body parts to offer the public an opportunity to view the intricacies and complexities of the human body. The exhibitions include displays of dissected human bodies which are permanently preserved through a process called polymer
preservation, also known as plastination. In essence, the bodies are drained of all fat and fluids, which are replaced with polymers such as silicone rubber, epoxy and polyester. This preserves the flesh and maintains its natural look. Skin from the
bodies is removed, or partially removed, to reveal musculoskeletal, nervous, circulatory and reproductive or digestive systems. The full body specimens are complimented by presentation cases of related individual organs and body parts, both healthy
and diseased, that provide a detailed look into the elements that comprise each system.

Our Bodies Revealed exhibition debuted
in August 2004 in Blackpool, England and was the first non-Titanic exhibition we produced. During the quarter ended November 30, 2008, we presented our human anatomy exhibitions at eighteen venues.

Dialog in the Dark

On February 25, 2008, we expanded our exhibition portfolio beyond those related to the Titanic and human anatomy when we entered into a long-term license agreement to present an exhibition series entitled Dialog in the
Dark. Our Dialog in the Dark exhibitions are intended to provide visitors with an opportunity to experience the paradox of learning to see without the use of sight. Visitors will be escorted through a series of
galleries immersed in total darkness and challenged to perform tasks without the use of vision. During the quarter ended November 30, 2008, we presented our Dialog in the Dark exhibitions at two venues.

Sports Immortals, The Traveling Exhibition

On March 13, 2008, we entered into a long-term license agreement with Sports Immortals, Inc. to present, promote and conduct multiple Sports Immortals, The Traveling Exhibition exhibitions, each of
which will feature sports artifacts and memorabilia. The exhibition was in development at November 30, 2008 and no venues are expected to open during fiscal 2009.

Our Sports Immortals exhibitions will draw upon what we believe is the largest and most extensive
known collection of sports memorabilia in the world. The collection consists of over 1,000,000 artifacts from the worlds greatest athletes, including video footage, artwork and other artifacts. Our agreement with Sports Immortals also grants
us the exclusive right to manufacture and sell Sports Immortals brand merchandise in conjunction with our exhibitions. Currently, the Company is evaluating its course of action in regard to our Sports Immortals exhibitions.

Star Trek The Exhibition

On June 4, 2008, we entered into a long-term license agreement with Exploration II, Inc. to present, promote and conduct Star Trek The Exhibition exhibitions. This multi-city touring exhibition
contains the worlds most comprehensive collection of authentic Star Trek ships, sets, costumes and props from five television series and ten films over the last 40 years. Star Trek The Exhibition fully immerses the visitor in the
legendary journey that has become synonymous with scientific innovation and ingenuity. Highlights of the experience include: the opportunity to ride through a Star Trek adventure in full motion Star Trek based flight simulators; the ability for
visitors to sit on a full size U.S.S. Enterprise bridge from the original television series and detailed re-creations of original sets. During the quarter ended November 30, 2008, we presented our Star Trek The Exhibition
exhibitions at two venues.



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##### Table of Contents

Additional Exhibitions

We intend to acquire, develop and present additional new exhibitions for presentation in the future, including exhibitions both related and unrelated to
our currently ongoing and recently announced exhibitions.

Lease Agreement with Ramparts, Inc.

On March 12, 2008, we entered into a lease agreement with Ramparts, Inc., the owner and operator of the Luxor Hotel and Casino, located in Las Vegas,
Nevada. In August 2008, we opened our BodiesThe Exhibition at the Luxor Hotel and Casino. The ten year lease commenced in August 2008, which coincided with the completion of the design and construction work related to the opening
of our BodiesThe Exhibition. On December 20, 2008 we opened our Titanic Exhibition at the Luxor Hotel and Casino.

Merchandising
Strategy

We also earn revenue from the sale of merchandise, such as apparel, posters and Titanic-related jewelry (which utilizes coal
we have recovered from the shipwreck). In addition, we also publish exhibition catalogs, which are sold at our exhibition gift shops.

On
March 27, 2008, we acquired MGR a full-service entertainment merchandising company to enhance our in-house merchandising division and are responsible for developing an overall long-term strategy for generating and maximizing sustainable retail
revenue for our current and future exhibitions. On December 29, 2008, we entered into an agreement with the former owner of MGR for the sale of selected assets and liabilities of our merchandising operations. The assets and liabilities
transferred were focused on the live music business and were purchased in our March, 2008 acquisition of MGR. The live music aspect of the merchandising business is not consistent with our current business strategy, requires ongoing capital
commitments and achieves very low operating margins. We intend to continue to focus on merchandising activities at all our exhibition locations to increase revenue per attendee and our margins on this activity. See Note 11, Subsequent
Events to our condensed consolidated financial statements in Item 1 of this report.

Information Regarding Exhibitions Outside the United
States

Our exhibitions regularly tour outside the United States. Approximately 50.4% and 43.8% of our revenues in the quarters ended
November 30, 2007 and 2008, respectively, resulted from exhibition activities outside the United States. Because our financial arrangements with our foreign vendors have historically been based upon foreign currencies, we are exposed to the
risk of currency fluctuations between the U.S. dollar and the currencies of the countries in which our exhibitions are touring. See Quantitative and Qualitative Disclosures About Market Risk in this report for more information.



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##### Table of Contents

Results of Operations

A summary of our results of operations as a percentage of revenue for the three and nine month periods ended November 30, 2007 and 2008, respectively, are shown below (unaudited):



|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|----------------------------------------------------------------------------------------- |  | ------------------------------- | -- |  | ------------------------------ | -- |  | ----- | -- |  | ---- | --
|                                                                                          |  | Three Months Ended November 30, |    |  | Nine Months Ended November 30, |   
|                                                                                          |  | 2007                            |    |  | 2008                           |    |  | 2007  |    |  | 2008 |   
|Revenue:                                                                                  |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Exhibition revenues                                                                       |  | 97.5                            | %  |  | 83.9                           | %  |  | 96.7  | %  |  | 84.9 | % 
|Merchandise and other                                                                     |  | 2.4                             | %  |  | 15.9                           | %  |  | 3.1   | %  |  | 15.0 | % 
|Sale of coal                                                                              |  | 0.1                             | %  |  | 0.2                            | %  |  | 0.2   | %  |  | 0.1  | % 
|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Total revenue                                                                             |  | 100.0                           | %  |  | 100.0                          | %  |  | 100.0 | %  |  | 100  | % 
|                                                                                          |  |                                 |    | 
|Cost of revenue:                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Exhibition costs                                                                          |  | 30.9                            | %  |  | 54.6                           | %  |  | 27.5  | %  |  | 48.3 | % 
|Cost of merchandise sold                                                                  |  | 0.2                             | %  |  | 9.3                            | %  |  | 0.5   | %  |  | 6.3  | % 
|Cost of coal sold                                                                         |  | 0.0                             | %  |  | 0.0                            | %  |  | 0.0   | %  |  | 0    | % 
|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Total cost of revenue (exclusive of depreciation and amortization shown separately below) |  | 31.1                            | %  |  | 63.9                           | %  |  | 28.0  | %  |  | 54.6 | % 
|                                                                                          |  |                                 |    | 
|Gross profit                                                                              |  | 68.9                            | %  |  | 36.1                           | %  |  | 72.0  | %  |  | 45.4 | % 
|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Operating expenses:                                                                       |  |                                 |    |  |                                |    |  |       |    |  |      |   
|General and administrative                                                                |  | 41.4                            | %  |  | 47.8                           | %  |  | 29.3  | %  |  | 43.8 | % 
|Depreciation and amortization                                                             |  | 3.7                             | %  |  | 9.5                            | %  |  | 3.7   | %  |  | 8.4  | % 
|Loss on sale of fixed asset                                                               |  | 0.0                             | %  |  | 0.0                            | %  |  | 0.0   | %  |  | 0.0  | % 
|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Total operating expenses                                                                  |  | 45.1                            | %  |  | 57.2                           | %  |  | 33.0  | %  |  | 52.2 | % 
|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Income (loss) from operations                                                             |  | 23.8                            | %  |  | (21.1                          | )% |  | 39.0  | %  |  | (6.8 | )%
|                                                                                          |  |                                 |    | 
|Other income and expenses:                                                                |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Interest income                                                                           |  | 1.7                             | %  |  | 0.3                            | %  |  | 1.7   | %  |  | 0.5  | % 
|Interest expense                                                                          |  | (0.0                            | )% |  | 0.0                            | %  |  | (0.0  | )% |  | 0.0  | % 
|Other income                                                                              |  | 0.0                             | %  |  | 0.7                            | %  |  | 0.0   | %  |  | 0.2  | % 
|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Total other income and expenses                                                           |  | 1.7                             | %  |  | 1.0                            | %  |  | 1.7   | %  |  | 0.7  | % 
|                                                                                          |  |                                 |    | 
|Income (loss) before provision for income taxes                                           |  | 25.5                            | %  |  | (20.1                          | )% |  | 40.7  | %  |  | (6.1 | )%
|                                                                                          |  |                                 |    | 
|Provision for (benefit) from income taxes                                                 |  | 9.2                             | %  |  | (6.4                           | )% |  | 14.7  | %  |  | (1.9 | )%
|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   
|Net income (loss)                                                                         |  | 16.3                            | %  |  | (13.7                          | )% |  | 26.0  | %  |  | (4.1 | )%
|                                                                                          |  |                                 |    |  |                                |    |  |       |    |  |      |   

The Quarter Ended November 30, 2008 Compared to the Quarter Ended November 30, 2007

During the quarter ended November 30, 2008, our revenue decreased approximately 19.6% to $13,456,000 as compared to
$16,735,000 in the quarter ended November 30, 2007. The decrease in exhibition revenue was primarily attributable to a decrease in exhibition revenue of approximately 30.8% to $11,285,000 during the quarter ended November 30, 2008 as
compared to $16,311,000 for the quarter ended November 30, 2007. The decrease in exhibition revenue primarily attributable to an overall attendance reduction of 34% at our human anatomy and Titanic exhibitions for the quarter ended
November 30, 2008 compared to the quarter ended November 30, 2007. This downturn in attendance primarily resulted from six exhibitions placed into storage and underperforming venues as a result of lower attendance coupled with a downturn
in the economy, occurred despite an increase in the number of concurrent operations of BodiesThe Exhibition and Bodies Revealed locations to eighteen for the quarter ended November 30, 2008 compared to thirteen for
the quarter ended November 30, 2007.

License and guarantee revenue, a component of exhibition revenue, decreased $2,005,000 to
$5,308,000 for the quarter ended November 30, 2008 as compared to $7,313,000 for the quarter ended November 30, 2007. The decrease in license and guarantee revenue is primarily attributable to the agreement with Live Nation, Inc.
(Live Nation) that was in effect during the current year quarter, as compared to the Live Nation agreement in effect during the prior years quarter. We recognized revenue of $4,000,000 for the quarter ended November 30, 2008
in connection with an exclusive licensing agreement to co-present an additional eight human anatomy exhibitions with Soon To Be Named Corporation (STBN), successor in interest to Live Nation.



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##### Table of Contents

Michael Cohl, formerly a director and executive officer of Live Nation, is a principal of STBN. With respect to each jointly presented exhibition, we are
responsible for exhibition design, installation and licensing, including the provisions of expertise, exhibitry and specimens and Live Nation is responsible for marketing, public relations and exhibition operations and security. We recognized
revenue of $6,000,000 for the quarter ended November 30, 2007 in connection with the original exclusive licensing agreement to co-present twelve human anatomy exhibitions with Live Nation in the Exclusive Territory. See Note 7, Exclusive
License Agreement, to our condensed consolidated financial statements included in Item 1 of this report.

Merchandise and other
revenue increased approximately $1,733,000 to $2,143,000 for the three months ended November 30, 2008 as compared to $410,000 for the three months ended November 30, 2007. This increase in merchandise and other revenue is primarily
attributed to our acquisition of MGR, which accounted for approximately $1,400,000 of the increase. On December 29, 2008, we sold selected assets and liabilities of MGR related to our merchandising operations to the former owner of MGR. See
Note 7, Subsequent Events, to our condensed consolidated financial statements included in Item 1 of this report.

We
incurred exhibition costs of $7,348,000 and $5,172,000 for our third quarter ended November 30, 2008 and 2007, respectively. The increase in exhibition costs of $2,176,000 is primarily attributable to production and marketing costs for an
increased number of self-run exhibitions, where all costs are recorded by us compared to partnership arrangements where we share costs with a partner. In addition, specimen license costs were higher in the current quarter due to an increase in the
number of specimen sets under our license agreement with The Universe Within Project LTD, which permits us to promote three Our Body: The Universe Within exhibitions.

We incurred merchandise costs of $1,250,000 for the quarter ended November 30, 2008 compared to $29,000 for the quarter ended November 30,
2007. This increase is primarily a result of our MGR acquisition. See Note 7, Subsequent Events, to our condensed consolidated financial statements included in Item 1 of this report.

During the quarter ended November 30, 2008, our gross profit decreased approximately 57.9% to $4,856,000 as compared to $11,530,000 in the quarter
ended November 30, 2007. Gross profit was 36.1% and 68.9% for the quarters ended November 30, 2008 and 2007, respectively. The decrease in our gross profit percentages is primarily attributable to a decrease in our revenue as a result of
lower attendance at our exhibitions, as a result of an increase in the number of our self-run exhibitions, where all costs are recorded by us, and a $2,005,000 reduction in license and guarantee revenue, which has no significant direct costs.

Our general and administrative expenses decreased to $6,429,000 from $6,934,000, or approximately 7.3%, during the quarter ended
November 30, 2008 as compared to the quarter ended November 30, 2007. The decrease in general and administrative expenses is primarily attributable to the restructuring of our senior management team during the second quarter which resulted
in the elimination of salaries and stock compensation, partially offset by severance which accounted for a decrease in general and administrative expenses of approximately $2,200,000. This decrease in general and administrative costs was offset by
higher professional fees, increase in bad debt allowance, and higher general and administrative costs as a result of our acquisition of MGR which aggregated approximately $1,600,000.

Our depreciation and amortization expenses increased $659,000, or 107.3%, to $1,273,000 during the quarter ended November 30, 2008 as compared to
$614,000 for the quarter ended November 30, 2007. The increase in depreciation and amortization expense is attributable to an increase in property and equipment associated with an increase in the number of our self-run exhibitions and
significant capital projects such as the Luxor project, Dialog in the Dark exhibitions and the amortization of definite life intangibles associated with the Universe Within Project LTD.

We realized a loss from operations of $2,846,000 during the quarter ended November 30, 2008 as compared to income from operations of $3,982,000 in
the same prior year period. This decrease is primarily attributable to lower revenue as a result of lower exhibition attendance combined with higher costs associated with our self-run exhibitions.



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Interest income of $46,000 was primarily associated with interest earned on our bank cash balances during
the quarter ended November 30, 2008 compared to $289,000 during the quarter ended November 30, 2007. This decrease in interest income is due to the decline in cash balances as a result of our capital projects, our acquisition of MGR and
other reductions of working capital.

We realized a loss before income taxes of $2,707,000 for the quarter ended November 30, 2008 as
compared to income of $4,271,000 in the same prior year period. We realized net loss of $1,842,000 during the quarter ended November 30, 2008 as compared to a net income of $2,730,000 in the prior year period.

We recorded a benefit from income taxes of $865,000 for the three months ended November 30, 2008 at an effective rate of 31.9% as compared to an
income tax provision of $1,541,000 at an effective rate of 36.0% for the same period in the prior year.

Basic (loss) income per common
share for the quarters ended November 30, 2008 and 2007 was $(0.06) and $0.09, respectively. The basic weighted average shares outstanding for each of the quarters ended November 30, 2008 and 2007 was 29,291,666 and 30,047,900
respectively. Diluted (loss) income per common share for each of the quarters ended November 30, 2008 and 2007 was $(0.06) and $0.08, respectively. The diluted weighted average shares outstanding for the quarter ended November 30, 2008 and
2007 was 29,291,666 and 34,097,129 respectively.

The Nine Months Ended November 30, 2008 Compared to the Nine Months Ended November 30,
2007

During the nine months ended November 30, 2008, our revenue decreased approximately 1.1% to $43,789,000 as compared to
$44,263,000 for the nine months ended November 30, 2007. License revenue, a component of exhibition revenue, decreased to $8,638,000 for the nine months ended November 30, 2008 as compared to $12,570,000 for the nine months ended
November 30, 2007. The decrease in license revenue is primarily attributable to the Live Nation agreement that is in effect for the current year as compared to the Live Nation agreement that was in effect in the prior year as well as a reduced
number of venues in which we receive a license fee (primarily attributable to an increase in self run operations). We recognized revenue of $4,000,000 for the nine months ended November 30, 2008 in connection with an exclusive licensing
agreement to co-present an additional eight human anatomy exhibitions with STBN, a successor in interest to Live Nation. We recognized revenue of $6,000,000 for the nine months ended November 30, 2007 in connection with the original exclusive
licensing agreement to co-present twelve human anatomy exhibitions with Live Nation in the Exclusive Territory. With respect to each jointly presented exhibition, we are responsible for exhibition design, installation and licensing, including the
provisions of expertise, exhibitry and specimens and STBN is responsible for marketing, public relations and exhibition operations and security. See Note 7, Exclusive License Agreement, to our condensed consolidated financial statements
included in Item 1 of this report.

Merchandise and other revenue increased approximately $5,195,000 to $6,575,000 during the nine
months ended November 30, 2008 as compared to $1,380,000 for the nine months ended November 30, 2007. This increase in merchandise and other revenue is primarily attributed to our acquisition of MGR. On December 29, 2008, we sold
selected assets and liabilities of MGR related to our merchandising operations to the former owner of MGR. See Note 7, Subsequent Events, to our condensed consolidated financial statements included in Item 1 of this report.

We incurred exhibition costs of $21,146,000 and $12,171,000 for the nine months ended November 30, 2008 and 2007, respectively. The
increase in exhibition costs of $8,975,000 is primarily attributable to production and marketing costs for an increased number of self-run exhibitions, where all costs are recorded by us compared to partnership arrangements, where we share costs
with a partner. In addition, specimen license costs were higher in the current nine month period due to an increase in the number of specimen sets under our license agreement with The Universe Within Project LTD, which permits us to promote three
Our BodyUniverse Within exhibitions.



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We incurred merchandise costs of $2,744,000 for the nine months ended November 30, 2008 compared to
$228,000 for the same period in the prior year. This increase is primarily a result of our acquisition of MGR. See Note 7, Subsequent Events, to our condensed consolidated financial statements included in Item 1 of this report.

During the nine months ended November 30, 2008, our gross profit decreased approximately 37.5% to $19,895,000 as compared to
$31,849,000 for the nine months ended November 30, 2007. Gross profit was 45.4% and 72.0% for the nine months ended November 30, 2008 and 2007, respectively. The decrease in our gross profit percentages is primarily attributable to an
increase in the number of our self-run exhibitions, and a $3,932,000 reduction in license and guarantee revenue, which has no significant direct costs.

Our general and administrative expenses increased to $19,164,000 from $12,912,000, or approximately 48.5%, during the nine month period ended November 30, 2008 as compared to the nine month period ended
November 30, 2007. The increase in general and administrative expenses is primarily attributable to the restructuring of our senior management team which occurred during the second quarter and which accounted for an increase in compensation of
approximately $2,400,000. As a result of certain officers that departed we reversed stock compensation of $3,700,000, which was partially offset by severance of $2,100,000. We also incurred higher professional fees of approximately $2,100,000 for
Sarbanes-Oxley testing, consulting costs related to various projects as well as higher legal costs for various matters. We, also, had higher general and administrative costs of approximately $1,900,000 as a result of our MGR acquisition. We incurred
approximately $275,000 associated with a royalty settlement and we also increased our bad debt allowance by approximately $500,000.

Our
depreciation and amortization expenses increased $2,023,000, or 121.3%, to $3,691,000 during the nine month period ended November 30, 2008 as compared to $1,668,000 for the nine month period ended November 30, 2007. The increase in
depreciation and amortization expense is attributable to an increase in property and equipment associated with an increase in the number of our self-run exhibitions and significant capital projects such as the Luxor Bodies exhibition and the
amortization of definite life intangibles associated with The Universe Within Project LTD and our acquisition of MGR. See Note 7, Subsequent Events, to our condensed consolidated financial statements included in Item 1 of this
report.

We realized a loss from operations of $2,965,000 during the nine months ended November 30, 2008 as compared to income from
operations of $17,269,000 in the same prior year period. We attribute this decrease in income from operations to a decrease in revenue resulting from lower attendance and underperforming partner arrangements also as a result of lower attendance and
weak economy. In addition, we had an increase in the number of our self-run exhibitions and higher costs for personnel and production related to our new exhibitions.

Interest income was $209,000 and $736,000, which was primarily associated with interest earned on our bank cash balances during the nine months ended November 30, 2008 and 2007, respectively. This decrease in
interest income is due to the decline in cash balances as a result of our capital projects, MGR acquisition, and other reductions of working capital. See Note 7, Subsequent Events, to our condensed consolidated financial statements
included in Item 1 of this report.

We realized net loss before income taxes of $2,666,000 for the nine month period ended
November 30, 2008 as compared to net income before taxes of $18,015,000 in the same prior year period. We realized net loss of $1,815,000 during the nine month period ended November 30, 2008 as compared to net income of $11,530,000 in the
prior year period.

We recorded a benefit from income taxes of $851,000 for the nine months ended November 30, 2008 at an effective
rate of 31.9% as compared to an income tax provision of $6,485,000 at an effective rate of 36.0% for the same period in the prior year.

Basic (loss) income per common share for the nine month periods ended November 30, 2008 and 2007 was $(0.06) and $0.39, respectively. The basic weighted average shares outstanding for each of the nine month periods ended
November 30, 2008 and 2007 was 29,253,863 and 29,660,719, respectively. Diluted (loss) income per common share for each of the nine month periods ended November 30, 2008 and 2007 was $(0.06) and $0.35, respectively. The diluted weighted
average shares outstanding for the nine month periods ended November 30, 2008 and 2007 was 29,253,863 and 33,303.780, respectively.



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##### Table of Contents

Liquidity and Capital Resources

Cash flows from operating activities

Net cash used in operating activities was $1,591,000 for the nine month period ended November 30, 2008, as compared to net cash provided by operating activities of $16,130,000 in the nine month period ended November 30, 2007. The
decrease in operating cash flows for the first nine months of fiscal 2009 as compared to operating cash flows for the first nine months of fiscal 2008 is primarily attributable to our decrease in net income for the nine months ended
November 30, 2008 and other changes in working capital as a result of reduced attendance, an increased number of self-run exhibitions and an increase in personnel and production costs related to our new exhibitions.

The following table sets forth our working capital (current assets less current liabilities) balances and our current ratio (current assets/current
liabilities) as of the year ended February 29, 2008 and the quarter ended November 30, 2008:



|                |  |                       |            |                       |   |           
|--------------- |  | --------------------- | ---------- | --------------------- | - | ----------
|                |  | As ofFebruary 29,2008 |            | As ofNovember 30,2008
|Working Capital |  | $                     | 23,979,000 |                       | $ | 13,930,000
|Current Ratio   |  |                       | 7.73       |                       |   | 2.52      

Our net working capital decreased by $10,049,000 at November 30, 2008, as compared to
February 29, 2008. This decrease is primarily attributable to a decrease in operating cash as a result of lower income from operations primarily due to underperforming venues resulting from lower attendance, an increase in the number of our
self-run exhibitions and increased costs for personnel and production related to our new exhibitions.

Cash flows from investing
activities

For the nine-month period ended November 30, 2008, the total cash used in investing activities was $10,701,000
compared to $7,583,000 for the nine-month period ended November 30, 2007. This increase in cash used in investing activities, which is net of 2,500,000 received from Carpathia, is primarily attributable to our acquisition of MGR, costs
associated with our capital project at the Luxor Hotel and Casino, and license costs associated with our new exhibitions, Sports Immortals and Dialog in the Dark. We, also, incurred higher costs for purchases of property and equipment as a result of
an increased number of our self-run exhibition venues.

Cash flows from financing activities

For the nine-month periods ended November 30, 2008 and November 30, 2007, cash provided by financing activities was $626,000 and $3,775,000,
respectively. This decrease in cash provided from financing activities is primarily attributable to a reduction of proceeds received from the exercise of options and warrants. Exercises of stock options and warrants for the nine months ended
November 30, 2008 was $229,000 compared to $2,391,000 for the nine-month period ended November 30, 2007.

Our shareholders
equity was $45,029,000 at November 30, 2008, as compared with $47,096,000 at February 29, 2008.

On September 26, 2008, we
entered into a First Amendment to Loan Agreement with Bank of America, N.A. (the First Amendment). The First Amendment amends, in accordance with its terms, that certain Loan Agreement made as of October 4, 2007 between us and Bank of
America and extends such agreement to September 26, 2009 (the Loan Agreement). The Loan Agreement, as amended by the First Amendment, provides us with a $10,000,000 revolving line of credit with Bank of America. At our request, such
credit limit may be increased to $25,000,000, provided that Bank of America consents to such increase.



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At our option, amounts outstanding under the Loan Agreement, as amended bear interest at (i) the
greater of Bank of Americas prime rate or the federal funds rate, plus a margin (as defined below); or (ii) the LIBOR rate, plus a margin. The amount of the margin will be based upon our leverage ratio (which is the ratio of total funded
debt to earnings before interest, tax, depreciation and amortization (EBITDA), as each term is defined in the Loan Agreement). If our leverage ratio is less than or equal to 1 to 1, the margin will be 2.50%. If our leverage ratio is
greater than 1 to 1, the margin will be 3.00%. The Loan Agreement requires us to maintain a leverage ratio not to exceed 1.5 to 1 and a basic fixed charge coverage ratio (which is the ratio of (i) the sum of EBITDA minus the sum of taxes and
dividends, to (ii) the sum of interest expense, the current portion of long term debt and the current portion of capitalized lease obligations) of at least 2 to 1. In addition, we are required to pay a facility fee on the unused portion of the
Loan Agreement of 0.25% if our leverage ratio is less than 1 to 1 and 0.50% if our leverage ratio is greater than 1 to 1, which amount is payable quarterly in arrears. Interest payments under the Loan Agreement also must be made not less frequently
than quarterly. The Loan Agreement also provides that we are required to pay Bank of America an annual fee in an amount equal to 0.50% of the maximum amount of the Loan Agreement at the time such fee is due.

Upon termination of the Loan Agreement, we may request that Bank of America convert all amounts then outstanding into a three year term loan. In the
event that Bank of America consents to such conversion request, we will be required to amortize the outstanding borrowings under the Loan Agreement and make quarterly payments of principal and interest. Such term loan will also require us to make
annual pre-payments equal to 50% our excess cash flow (which is EBITDA minus the sum of interest expense, taxes, dividends, capital expenditures, principal payments of long term debt and payments of capitalized lease obligations) in the event our
leverage ratio is greater than 1 to 1 during any year in which amounts under such term loan remain outstanding. The Loan Agreement is secured by all of our assets, including our equity interests in our subsidiaries, and is also guaranteed by our
subsidiaries.

We borrowed as much as $3,969,000 from this revolving line of credit and had an outstanding balance of $427,000 as of
November 30, 2008 which is included in accounts payable and accrued liabilities. Based upon actual results over the past four fiscal quarters, as of November 30, 2008, we presently have access to approximately $7,100,000 under our
revolving loan agreement. Should our financial performance not improve, the amount available to us for borrowing under our revolving credit facility will continue to decrease, as the amounts available to us for borrowing under such agreement are
based on our actual results for a trailing four quarter period. Although we did not have a balance under the revolving loan agreement as of January 8, 2009, we anticipate that we may require additional capital resources in fiscal 2010 in excess of
the amount available to us under the revolving loan agreement, despite the expected reduction in our operating and overhead costs in the coming months. Should the amounts available to us under the revolving loan agreement with Bank of America be
reduced further, if we are not able to continue to meet our debt covenants under such agreement or should Bank of America decide not to advance funds to us under such agreement, we would have to seek outside capital from other sources. We cannot
provide any assurances that such funding will be available to us on commercially reasonable terms, if at all, or that we will be able to raise all or a portion of the any capital we may require. In such an event, there would be a material adverse
effect on our business, financial condition and results of operations.

Our current assets totaled $23,091,000 at November 30, 2008,
compared to $27,544,000 at February 29, 2008. This decrease was primarily due to reductions in our cash balances as discussed above. This decrease in cash was offset by an increase in accounts receivable of $4,622,000 which is primarily attributable
to the $4,000,000 that STBN is obligated to pay us under the exclusive licensing agreement. As of January 8, 2009, there was an outstanding balance of $1,000,000 under the exclusive licensing agreement, which STBN is obligated to pay us by January
19, 2009. See Note 7, Exclusive License Agreement, to our condensed consolidated financial statements included in Item 1 of this report. In addition, we had an increase in income tax receivables of $3,271,000 which is primarily
attributable to our overpayment of estimated tax payments resulting from lower than expected earnings.

Our current liabilities totaled
$9,161,000 at November 30, 2008, compared to $3,565,000 at February 29, 2008. This increase in current liabilities is primarily attributable to an increase in accounts payable and accrued expenses of $4,815,000 which is primarily due to the
significant capital expenditures by us for the Luxor project and Dialog in the Dark exhibitions coupled with an increase in accrued expenses for higher professional fees associated with our Sarbanes Oxley testing, tax consulting costs and higher
legal fees for various matters. In addition, we had an increase in deferred revenue of $685,000 related to unearned revenue received from co-promoters associated with our exhibitions where we have not met our deliverable requirements.

Off-Balance Sheet Arrangements

We
have no off-balance sheet financial arrangements.

Critical Accounting Policies

There have been no material changes to our critical accounting policies as disclosed in our Annual Report filed on Form 10-K for our fiscal year ended
February 29, 2008.

Contractual Obligations

There have been no material changes to our contractual obligations as disclosed in our Annual Report filed on Form 10-K for our fiscal year ended February 29, 2008.



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Recent Accounting Pronouncements

In September 2006, the Financial Accounting Standards Board, or (FASB), issued Statement of Financial Accounting Standards,
(SFAS,) SFAS No.157, Fair Value Measurements. SFAS No. 157 provides guidance for measuring the fair value of assets and liabilities. It requires additional disclosures related to the extent to which companies measure
assets and liabilities at fair value, the information used to measure fair value, and the effect of fair value measurements on earnings. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. The adoption of SFAS
No. 157 for financial assets and liabilities on March 1, 2008 did not have a material impact on our consolidated results of operations and financial condition.

In February 2008, the FASB issued SFAS No. 157-1. SFAS No. 157-1 amends the scope of FASB Statement No. 157 to exclude FASB Statement No. 12, Accounting for Leases, and other accounting
standards that address fair value measurements for purposes of lease classifications or measurement under FASB Statement No. 13. SFAS No. 157-1 is effective on initial adoption of FASB Statement No. 157. The scope exception does not
apply to assets acquired and liabilities assumed in a business combination that are required to be measures at fair value under SFAS No. 141, Business Combinations, or SFAS No. 141R, regardless of whether those assets and
liabilities are related to leases.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets
and Financial Liabilities  including an Amendment of SFAS No. 115, which permits an entity to measure many financial assets and financial liabilities at fair value that are not currently required to be measured at fair
value. Entities that elect the fair value option will report unrealized gains and losses in earnings at each subsequent reporting date. The fair value option may be elected on an instrument-by-instrument basis, with few exceptions. SFAS No. 159
amends previous guidance to extend the use of the fair value option to available-for-sale and held-to-maturity securities. SFAS No. 159 also establishes presentation and disclosure requirements to help financial statement users understand the
effect of the election. SFAS No. 159 is effective as of the beginning of the first fiscal year beginning after November 15, 2007. The adoption of SFAS No. 159 as of March 31, 2008 did not impact our consolidated results of
operations and financial condition as we did not elect to fair value any of the eligible assets or liabilities.

In December 2007, FASB
issued SFAS No. 141 (revised 2007), Business Combinations (SFAS 141R). SFAS 141R established principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets
acquired, the liabilities assumed, any non-controlling interest in the acquiree and the goodwill acquired. SFAS 141R also established disclosure requirements to enable the evaluation of the nature and financial effects of the business combination.
This statement will apply prospectively to any business combination which is effective for fiscal years beginning after December 15, 2008. Once adopted, we will assess the impact of SFAS 141R upon the occurrence of a business combination.

In December 2007, FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements-an amendment of
Accounting Research Bulletin No. 51. SFAS No. 160 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the
parent and to the non-controlling interest, changes in parents ownership interest, and the valuation of retained non-controlling equity investments when a subsidiary is deconsolidated. SFAS No. 160 also established disclosure requirements
that clearly identify and distinguish between the interests of the parent and the interests of the non-controlling owners. SFAS No. 160 is effective for fiscal years beginning after December 15, 2008. We are currently evaluating the
potential impact, if any, of the adoption of SFAS No. 160 on our consolidated financial statements.

In December 2007, the FASB
ratified EITF Issue No. 07-1, Accounting for Collaborative Arrangements.(EITF07-1), which defines collaborative arrangements and establishes reporting requirements for transactions between participants in a collaborative
arrangement and between participants in the arrangement and third parties. EITF 07-1 also establishes the appropriate income statement presentation and classification for joint operating activities and payments between participants, as well as the
sufficiency of the disclosures related to these arrangements. EITF 07-1 is effective for fiscal years beginning after December 15, 2008. EITF 07-1 shall be applied using a modified version of retrospective transition for those arrangements in
place at the effective date. Companies are required to report the effects of applying EITF-07-1 as a change in accounting principle through retrospective application to all prior periods presented for all arrangements existing as of the effective
date, unless it is impracticable to apply the effects the change retrospectively. We are in the process of determining what effect, if any the adoption of EITF 07-1 will have on our consolidated results of operations and financial condition.



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On March 19, 2008, FASB issued SFAS No. 161, Disclosures about Derivative Instruments and
Hedging Activities. SFAS No. 161 is intended to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entitys
financial position, financial performance and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. We are currently
evaluating the potential impact, if any, of the adoption of SFAS No. 161 on our consolidated financial statements.

In May 2008, FASB
issued SFAS No. 162, The Hierarchy of Generally Accepted Accounting Principles. SFAS No. 162 mandates the GAAP hierarchy resides in the accounting literature as opposed to the audit literature. SFAS No. 162 has the
practical impact of elevating the FASB Statements of Financial Accounting Concepts in the GAAP hierarchy. SFAS No. 162 will become effective 60 days following SEC approval. We do not believe SFAS No. 162 will have an impact on our
consolidated financial statements.



|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
|------- | -----------------------------------------------------------

Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Market risk exposure is primarily a result of fluctuations in interest rates and foreign currency
exchange rates. We do not hold or issue financial instruments for trading purposes.

Interest Rate Risk

We have exposure to market rate risk for changes in interest rates related to our variable interest rate credit facility discussed in Item 2 of this
report under the heading Managements Discussion and Analysis of Financial Condition and Results of Operations. Interest income on our cash, cash equivalents and short-term investments is subject to interest rate fluctuations, but
we believe that the impact of such fluctuations does not have a material effect on our financial position due to the short-term nature of such investments. We do not have any long-term debt. Our interest income and interest expense are most
sensitive to the general level of interest rates in the United States. Sensitivity analysis is used to measure our interest rate risk. For the three and nine months ended November 30, 2008, a 100 basis-point adverse change in interest rates
would not have had a material effect on our consolidated financial position, earnings or cash flow.

Foreign Currency Risk

We conduct a portion of our business activities outside of the United States, and are thereby exposed to the risk of currency
fluctuations between the United States dollar and foreign currencies of the countries in which we are conducting business. If the value of the United States dollar decreases in relation to such foreign currencies, our potential revenue from
exhibition and merchandising activities outside of the United States will be adversely affected. During the quarter ended November 30, 2008, we did not incur any material losses because of changes in the exchange rates with respect to foreign
currencies. Although our financial arrangements with foreign parties may be based upon foreign currencies, we have sought, and will continue to seek where practicable, to make our financial commitments and understandings based upon the United States
dollar in order to minimize the adverse potential effect of currency fluctuations.



|ITEM 4. | CONTROLS AND PROCEDURES
|------- | -----------------------

Under the supervision and
with the participation of our management, including our President, Chief Executive Officer and Chairman (principal executive officer) and Vice President and Chief Financial Officer (principal financial officer), our management has evaluated the
effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15(d)-15(e) of the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this
evaluation, our President, Chief Executive Officer and Chairman and Vice President and Chief Financial Officer concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were
effective.



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There have been no changes in our internal control over financial reporting during the period covered by
this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART IIOTHER INFORMATION



|ITEM 1. | LEGAL PROCEEDINGS
|------- | -----------------

The Company is involved in
litigation from time to time in the regular course of its business. A summary of developments in the Companys material legal proceedings are described below.

On March 25, 2008, the United States District Court for the Eastern District of Virginia granted the U.S. government permission to file an amicus curie (friend of the court) brief in response to our wholly
owned subsidiary, R.M.S. Titanic, Inc.s November 30, 2007 motion for an interim salvage award. The U.S. government took the position that the issuance of an in specie (in kind) salvage award to R.M.S. Titanic, with limitations,
could be an appropriate mechanism to satisfy the salvage award and could help ensure that the Titanic artifacts are conserved and curated in an intact collection that remains available to the public. On April 15, 2008, the District Court
entered an order requesting that R.M.S. Titanic collaborate with the U.S. government and propose suggested covenants that would be included in an in specieaward. The order also outlined a process for further discussion pertaining to such
covenants, should the court decide to issue an in specie award. On June 12,2008 R.M.S. Titanic submitted covenants that may be included in an in specieaward, should the District Court determine one is appropriate, in
accordance with the April 15, 2008 order made by the District Court. After engaging in consultative discussions with the U.S. government over the past several months, on September 15, 2008, R.M.S. Titanic submitted revised covenants and
restrictions. On October 14, 2008, the U.S. government filed an amicus response to R.M.S. Titanics proposed revised covenants, and by leave of the District Court granted on October 31, 2008, R.M.S. Titanic in turn filed a reply brief
on November 12, 2008. On November 18, 2008, R.M.S. Titanic attended a status conference at the District Court. At the conclusion of the hearing, the District Court asked for certain additional submissions from R.M.S. Titanic and the
Government, which were provided. The District Court also indicated it would complete its review of the proposed revised covenants and conditions and any final areas of disagreement between the Government and R.M.S. Titanic, and likely
issue its final version and order in the future. There have not been any further decisions or announcements from the District Court since the November 18 hearing.

On April 28, 2006, Stefano Arts filed an action against Premier entitled Premier Exhibitions, Inc. v. Stefano Artsin the State Court of
Fulton County, State of Georgia. Stefano Arts alleges that we breached a contract which allegedly calls for us to pay to Stefano Arts moneys generated from our human anatomy exhibition in Tampa, Florida and additional moneys generated from our human
anatomy exhibition in New York City. The Company continues to aggressively defend itself but the outcome of this matter can not be predicted. A hearing on the Companys motion for summary judgment, which asks the court to grant the Company
judgment as a matter of law, has been set for February 5, 2009.

Except as disclosed above and in our Quarterly Reports on Form 10-Q
for the quarters ended May 31, 2008 and August 31, 2008, respectively, there have been no other material changes in the legal proceedings discussed in our Annual Report on Form 10-K for the year ended February 29, 2008.



|ITEM 1A. | RISK FACTORS
|-------- | ------------

We have updated and amended the risk
factors that were included in our Annual Report on Form 10-K for the fiscal year ended February 29, 2008 and in our Quarterly Report on Form 10-Q for the quarter ending August 31, 2008 to include the risk factors set forth below. Each of
the risks described below and in such Annual and Quarterly Reports could materially adversely affect our business, operating results, financial condition and the value of an investment in our common stock. Additional risks and uncertainties not
presently known to us, or those we currently deem immaterial, may also materially harm our business, operating results and financial condition.



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We may be unable to obtain financing to fund ongoing operations and future growth.

We can provide no assurances that our cash flow from operations, combined with our accessibility to cash and credit will be sufficient to allow us to
finance ongoing operations or to make investments necessary for future growth.

Should our financial performance not improve, the amount
available to us for borrowing under our revolving credit facility will continue to decrease, as the amounts available to us for borrowing under such agreement are based on our actual results for a trailing four quarter period. Although we did not
have a balance under the revolving loan agreement as of January 8, 2009, we anticipate that we may require additional capital resources in fiscal 2010 in excess of the amount available to us under the revolving loan agreement, despite the expected
reduction in our operating and overhead costs in the coming months. Should the amounts available to us under the revolving loan agreement with Bank of America be reduced further, if we are not able to continue to meet our debt covenants under such
agreement or should Bank of America decide not to advance funds to us under such agreement, we would have to seek outside capital from other sources. We cannot provide any assurances that such funding will be available to us on commercially
reasonable terms, if at all, or that we will be able to raise all or a portion of the any capital we may require. In such an event, there would be a material adverse effect on our business, financial condition and results of operations. For more
information, see Managements Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources, in Item 2 of this report.

Our business may be harmed as a result of threatened shareholder litigation.

Sellers Capital LLC,
our largest shareholder, has threatened to sue certain of our independent directors who serve on a special committee of our Board of Directors. Messrs. Sellers and Hugh Sam, who serve on our board of directors, are affiliates of Sellers Capital LLC.
We have entered into indemnification agreements with each member of the special committee and are obligated to indemnify and hold harmless each member of such committee made a party to or otherwise involved in certain legal proceedings as a result
of actions related to each members service as a director. Should Sellers Capital LLC or other shareholders bring such a legal proceeding, or a similar proceeding, our management team and Board could be forced to direct their attention and our
resources to the defense of such action, which could seriously harm our business, results of operations and financial condition. Moreover, if such action is ultimately successful and we are required to satisfy our indemnity obligations to such
independent directors, then our business, results of operations and financial condition could be materially adversely affected.

Our success depends on
the continued services of our senior executive officers and key employees and the loss of their services could seriously harm our ability to fulfill our business objectives.

During the quarter ending November 30, 2008, Harold W. Ingalls, our Chief Financial Officer, provided written notice indicating that he planned to
exercise a provision in his employment agreement that would permit him to resign from his position on January 10, 2009. If we are unable to promptly locate a qualified individual to fill Mr. Ingallss position, our business, financial
condition and operating results could be materially adversely affected.

We believe that our future success depends to a significant degree
on the skills and efforts of Arnie Geller, our President, Chief Executive Officer and Chairman and Tom Zaller, our Vice President of Exhibitions. If we lose the services of any of these individuals, our business and operating results could be
materially adversely affected.



|ITEM 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
|------- | ----------------------------------------------------

Our 2008 Annual Meeting of Shareholders (the Annual Meeting) was held on October 30, 2008. At the Annual Meeting, our shareholders:



|1. | Elected Douglas Baker, N. Nick Cretan, Arnie Geller, Harold W. Ingalls, Alan Reed, Mark A. Hugh Sam and Mark A. Sellers, each to serve as directors until our 2009 Annual Meeting of
Stockholders and until their respective successors are elected and have been qualified or until their earlier resignation, removal or death.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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|2. | Ratified the selection of Cherry, Bekaert & Holland, L.L.P. as our independent registered public accounting firm for the fiscal year ending February 29, 2009.
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

Messrs. Baker, Cretan, Geller, Ingalls, Reed, Hugh Sam and Sellers together constitute our entire board of directors.

On September 9, 2008, the record date of the Annual Meeting, we had 30,349,781 shares of common stock outstanding. The following sets
forth information regarding the results of the voting at



|                                                                                          |  |                |  |               
|----------------------------------------------------------------------------------------- |  | -------------- |  | --------------
|Proposal I  Election of Seven Directors:                                                 |  |                |  |               
|                                                                                          |  |               
|                                                                                          |  | Votes in Favor |  | Votes Withheld
|Douglas Banker                                                                            |  | 17,854,283     |  | 5,637,515     
|N. Nick Cretan                                                                            |  | 17,932,493     |  | 5,559,305     
|Arnie Geller                                                                              |  | 18,092,179     |  | 5,399,619     
|Harold W. Ingalls                                                                         |  | 17,908,600     |  | 5,583,198     
|Alan Reed                                                                                 |  | 17,854,479     |  | 5,637,319     
|Mark A. Hugh Sam                                                                          |  | 23,010,275     |  | 481,523       
|Mark A. Sellers                                                                           |  | 23,012,298     |  | 479,500       
|                                                                                          |  |               
|Proposal II  Ratification of Selection of Independent Registered Public Accounting Firm: |  |                |  |               
|                                                                                          |  |               
|Votes in Favor                                                                            |  | 23,133,581     |  |               
|Votes against                                                                             |  | 298,604        |  |               
|Abstentions                                                                               |  | 59,613         |  |               
|Broker non-votes                                                                          |  |                |  |               



|ITEM 6. | EXHIBITS.
|------- | ---------

See Index to Exhibits on page 29 of this
Quarterly Report on Form 10-Q.



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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

PREMIER EXHIBITIONS, INC.



|                       |  |     |  |                                                
|---------------------- |  | --- |  | -----------------------------------------------
|Dated: January 9, 2009 |  | By: |  | /s/ Arnie Geller                               
|                       |  |     |  | Arnie Geller,                                  
|                       |  |     |  | President, Chief Executive Officer and Chairman
|                       |  |     |  | (Principal Executive Officer)                  
|                       |  |    
|Dated: January 9, 2009 |  | By: |  | /s/ Harold W. Ingalls                          
|                       |  |     |  | Harold W. Ingalls,                             
|                       |  |     |  | Vice President and Chief Financial Officer     
|                       |  |     |  | (Principal Financial Officer)                  



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INDEX TO EXHIBITS



|            |                     |                                                                                                                                                                                                                                                |          |       |      |                           |         |      |             |           
|----------- | ------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ----- | ---- | ------------------------- | ------- | ---- | ----------- | ----------
|Exhibit No. |                     |                                                                                                                                                                                                                                                |          | Filed |      | Incorporated by Reference
|            | Exhibit Description |                                                                                                                                                                                                                                                | Herewith |       | Form |                           | Exhibit |      | Filing Date
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|10.1        |                     | Employment Agreement dated as of September 8, 2008 by and between Premier Exhibitions, Inc. and Harold W. Ingalls                                                                                                                              |          |       |      | 8-K                       |         | 99.1 |             | 9-12-2008 
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|10.2        |                     | Employment Agreement dated as of September 8, 2008 by and between Premier Exhibitions, Inc. and Kelli L. Kellar                                                                                                                                |          |       |      | 8-K                       |         | 99.2 |             | 9-12-2008 
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|10.3        |                     | First Amendment to Loan Agreement by and between Bank of America, N.A. and Premier Exhibitions, Inc.                                                                                                                                           |          |       |      | 8-K                       |         | 99.1 |             | 9-30-2008 
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|10.4        |                     | Renewal Promissory Note made in favor of Bank of America by Premier Exhibitions, Inc. as of September 26, 2008.                                                                                                                                |          |       |      | 8-K                       |         | 99.2 |             | 9-30-2008 
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|10.5        |                     | First Amendment to Premier Exhibitions, Inc./Live Nation, Inc. Agreement dated November 29, 2008, by and among JAM Exhibitions, LLC, Soon To Be Named Corporation, as successor in interest to
Live Nation, Inc. and Premier Exhibitions, Inc. |          |       |      | 8-K                       |         | 99.1 |             | 12-04-2008
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|10.6        |                     | Premier Exhibitions, Inc./Live Nation, Inc. Agreement dated November 27, 2007, by and between Premier Exhibitions, Inc., Live Nation, Inc. and JAM Exhibitions, LLC                                                                            |          |       |      | 8-K                       |         | 99.2 |             | 12-04-2008
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|31.1        |                     | Rule 13a-14(a)/15d-14(a) Certification of President, Chief Executive Officer and Chairman                                                                                                                                                      |          | X     |      |                           |         |      |             |           
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|31.2        |                     | Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer                                                                                                                                                                              |          | X     |      |                           |         |      |             |           
|            |                     |                                                                                                                                                                                                                                                |          |       |     
|32.1        |                     | Section 1350 Certifications                                                                                                                                                                                                                    |          | X     |      |                           |         |      |             |           



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