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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
 
                            ------------------------
 
                                   FORM 10-K
 
(MARK ONE)
 
  /X/    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
 
        FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998
                                       OR
 
  / /    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
 
        FOR THE TRANSITION PERIOD FROM ______________ TO ______________
 
                        COMMISSION FILE NUMBER 333-61433
 
                            ------------------------
 
                               EPIC RESORTS, LLC
 
             (Exact name of registrant as specified in its charter)
 
                  DELAWARE                             23-2888968
      (State or other jurisdiction of        (I.R.S. Employer Identification
       incorporation or organization)                     No.)
 
        1150 FIRST AVENUE, SUITE 900                      19406
            KING OF PRUSSIA, PA                        (Zip Code)
  (Address of principal executive offices)
 
       Registrant's telephone number, including area code: (610) 992-0100
 
        Securities registered pursuant to Section 12(b) of The Act: NONE
 
        Securities registered pursuant to Section 12(g) of The Act: NONE
 
                            ------------------------
 
    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 the past 90 days: Yes /X/  No / /
 
    Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Annual Report on Form 10-K or any
amendment to this Form 10-K. Yes /X/  No / /
 
    As of March 30, 1999, 1,118,000 Membership Interests of the Registrant were
outstanding.
 
                   Documents incorporated by reference: NONE
 
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<PAGE>
                                     PART I
 
ITEM 1. BUSINESS
 
HISTORY AND OWNERSHIP
 
    Epic Resorts, LLC, a Delaware limited liability company (the "Company"), was
formed in June 1998 to merge with Epic Resorts, Inc. Epic Resorts, Inc. had been
formed to combine the ownership of the London Bridge Resort and the Daytona
Beach Regency and their vacation ownership acquisition and development
businesses. London Bridge Resort was acquired in 1986 by London Bridge Resort,
Inc., a Delaware corporation wholly owned by Thomas F. Flatley, the Company's
President. In April 1996, the Daytona Beach Regency Resort was acquired by
Daytona Beach Regency, Ltd., a limited partnership of which Mr. Flatley is the
general partner.
 
    In connection with the private placement of $130 million aggregate principal
amount of the Company's Senior Secured Redeemable Notes due 2005 (the "Notes")
in July 1998, Epic Resorts, Inc. was merged into Epic Resorts, LLC and certain
of its subsidiaries were merged into limited liability companies. Mr. Flatley
simultaneously contributed his membership interests in certain of those
subsidiaries to the Company. In connection with the issuance of the Notes, the
Company acquired four new resorts (Desert Paradise Resort, Scottsdale Links
Resort, Palm Springs Marquis Villas and Island Links Resort) and purchased the
limited partnership interests in Daytona Beach Regency, Ltd. not owned by Mr.
Flatley.
 
EPIC'S VACATION OWNERSHIP BUSINESS
 
    The Company is a nationwide developer and marketer of vacation ownership
resorts located in major tourist destinations. Vacation ownership interests
typically entitle the buyer to a fully furnished vacation residence in any one
of the Company's six resorts based on the number of points purchased in Epic
Vacation Club, a nonprofit corporation operated by the Company (the "Club"). The
Club holds units of each of the Company's resorts which are transferred into the
Club by each of the Company's operating subsidiaries when the units are
developed or purchased by the applicable subsidiary. The Company converted its
operations to this vacation club system in January 1999. Prior to this time, a
customer would purchase a one-week interest at one particular resort, and would
receive a deed evidencing their purchase. The Company now sells points ("Club
Points") in the Club, which entitle the purchaser to reserve units at any of the
Company's six resorts and in increments as short as [one day]. A customer now
has access to all of the Company's resorts, as well as over 1,500 other resorts
worldwide through the Company's participation in vacation ownership interest
exchange networks. The vacation club system offers the Company's customers
greater flexibility in their vacation planning, a wider variety of vacation
options, and easier access to the Company's network of resorts.
 
    The Company's six resorts are located in Las Vegas, Nevada; Scottsdale,
Arizona; Palm Springs, California; Daytona Beach, Florida; Lake Havasu City,
Arizona; and Hilton Head, South Carolina.
 
    The Company markets and sells its deeded vacation ownership interests and
Club Points (collectively, "Vacation Ownership Interests") through both on-site
and off-site sales centers. In addition, the Company generates income through
the rental of available suites at its resorts. The Company sells Vacation
Ownership Interests to purchasers for leisure purposes and not for investment
purposes.
 
EPIC VACATION CLUB
 
    The Club is a Delaware nonprofit, non stock corporation formed by the
Company in 1998. The Club's articles of incorporation provide that it was formed
for the specific purpose of owning and managing the real property conveyed to it
by the Company and its resort subsidiaries. Purchasers of Club Points
("Purchasers") receive the right to reserve time at any of the resort units
conveyed to the Club as well as the right to vote to elect the Club's board
members and to vote on major Club matters. The number of votes that each
Purchaser has is based on the number of Club Points the Purchaser owns.
 
                                       1
<PAGE>
    The Club maintains a reserve, funded from the annual assessments collected
from Purchasers, which is used to maintain and upgrade the interiors and
furnishings of the resort units, and the exteriors and common areas of the
resorts in which the Club owns all of the units. The Club collects maintenance
dues from Purchasers based on the number of Club Points owned. Currently, the
annual dues are $237 for the first 5,000 Club Points owned, plus $72 for each
additional increment of 2,500 Club Points owned. These dues are intended to
cover the Club's operating costs, including condominium association dues at each
resort. The Company will pay association dues for all unsold Club Points.
 
    The vacation club system provides Purchasers with significant flexibility in
planning their vacations. Under this system, Purchasers can select vacations
according to their schedules, space needs and available Club Points. The number
of Club Points that are required to stay one day at one of the Company's resorts
varies depending upon the particular resort, the size of the unit, the season
and the day of the week. For example, a Friday or Saturday night stay at a
one-bedroom unit may require 825 Club Points per night off-season and 1,450 Club
Points per night in peak season. A midweek stay at the same one-bedroom unit
would require less Club Points. Club Points are reissued on an anniversary date
basis and any unused Club Points may be carried over for one year. A Purchaser
may also borrow Club Points from their allotment for the next year.
 
    In addition, Purchasers may also buy bonus time from the Club for use when
space is available. Bonus time can only be reserved within two weeks of use.
Bonus time gives customers the opportunity to use available units on short
notice at a reduced rate (generally from $20 to $50 per night for a two bedroom
unit, mid-week in the off-season) and to obtain vacation opportunities beyond
their Club Point allotment.
 
    The Club has a board of directors that manages its business and affairs.
Each of the directors and principal executive officers of the Club are also
officers of the Company. The Board must obtain the approval of a majority of the
voting power represented to take certain actions, including (i) any incurrence
of a capital expenditure exceeding 5% of the Club's budgeted gross expenses
during any fiscal year and (ii) the sale of any of the Club's property during
any fiscal year, if the aggregate fair market value is in excess of 5% of the
Club's budgeted expenses for that year.
 
SALES AND MARKETING
 
    The Company focuses its sales and marketing activities on generating a
predictable flow of both off-site and on-site prospective purchasers of Vacation
Ownership Interests at minimal cost.
 
    OFF-SITE SALES CENTERS: The Company currently operates off-site sales
    centers in Fresno, California and in Philadelphia, Pennsylvania. The Company
    also plans to add four additional sales centers by the end of 1999. The
    Company currently intends to locate these planned sales centers in major
    metropolitan areas, which can be conveniently toured during evenings and
    weekends. These centers, which are leased by the Company, are generally more
    cost effective because they reduce the need for on-site tours of the
    Company's resorts and are more easily accessible to the Company's target
    customers.
 
    ON-SITE SALES CENTERS: The Company utilizes a variety of marketing
    techniques to generate on-site tours, including mini-vacations resulting
    from telemarketing and targeted mailings, retail center kiosks, in-house
    marketing to renters, marketing to current owners of Vacation Ownership
    Interests and referrals. The Company's completed but unsold inventory of
    resort units also provides additional revenue as well as sales and marketing
    cost advantages through (i) rental income, (ii) access to a steady source of
    high quality, low cost, on-site sales tours from rental customers, and (iii)
    lower mini-vacation marketing costs.
 
    The Company typically establishes the sales prices for its Vacation
Ownership Interests on a resort-by-resort basis after reviewing local market
conditions. When the Company enters into a new market, it typically prices
Vacation Ownership Interests to attract the maximum number of potential
customers and gain market share. As the Company becomes more established in a
market, sales prices are increased to
 
                                       2
<PAGE>
reflect the high quality of its resorts. For example, average sales prices for
Vacation Ownership Interests at the Company's London Bridge Resort and Daytona
Beach Regency have increased from $8,900 and $7,900, at commencement of sales,
respectively, to $13,323 and $11,349, respectively, as of December 31, 1998.
 
    The Company's sales representatives are a critical component of its sales
and marketing effort, and the Company continually strives to attract, train and
retain a dedicated sales force. The Company provides sales instruction and
training, which coupled with the sales representative's valuable knowledge of
each resort, assists in acquainting prospective customers with the benefits of
each resort. The Company's sales staff is required to provide each customer with
a written disclosure statement regarding the Vacation Ownership Interest to be
sold prior to the time the customer signs a purchase agreement. This disclosure
statement sets forth relevant information regarding ownership of a Vacation
Ownership Interest at the resort and must be signed by every purchaser. The
Company believes that this information statement contains all material and
relevant information a customer requires to make an informed decision regarding
the purchase of a Vacation Ownership Interest at one of its resorts, and
contributes to its low rates of rescission. At closing, customers are also
provided with a toll free customer service phone number to facilitate any
additional information requests.
 
    To support its marketing and sales efforts, the Company has also developed a
computer database to track its vacation ownership marketing and sales programs.
Management believes that as the Company's vacation ownership operations grow,
this database will become an increasingly significant asset and will enable it
to take advantage of less costly marketing and referral opportunities.
 
FINANCIAL INFORMATION ABOUT GEOGRAPHIC AREAS
 
    The Company currently has no operations or sales outside the United States.
100% of the Company's revenues were generated from domestic sales of Vacation
Ownership Interests and resort operations during each of the fiscal years ended
December 31, 1996, 1997 and 1998. All of the Company's long-lived assets are
currently located in the United States. However, in the future, the Company may
expand its operations to include the acquisition or development of resorts
outside the United States. See Note 10 to the Notes to Consolidated Financial
Statements included herein for additional segment and geographical information
regarding the Company.
 
CUSTOMER FINANCING
 
    Approximately 90% of the Company's customers finance their purchase of a
Vacation Ownership Interest with the Company. These customers are required to
make a down payment of at least 10% of the Vacation Ownership Interest sales
price. The balance is typically financed for a period of seven to ten years at a
fixed interest rate. The Company financed approximately 90% of the aggregate
purchase price of these sales during each of 1996, 1997 and 1998, and received
cash for the remaining balance.
 
    As of December 31, 1998, the Company had a vacation ownership receivables
portfolio totaling approximately $12.8 million in principal amount, with a
weighted average contractual yield of approximately 15.5%, 14.9%, and 14.4% for
the years ended December 31, 1998, 1997 and 1996, respectively. The adequacy of
the Company's reserve for loan losses is determined by management and reviewed
on a regular basis considering, among other factors, historical frequency of
default, loss experience, present and expected economic conditions as well as
the quality of receivables.
 
    The Company believes that its financing is attractive to purchasers who find
it convenient to handle all facets of the purchase of Vacation Ownership
Interests through a single source. In addition, the downpayments required by the
Company are similar to those required by banks and mortgage companies which
 
                                       3
<PAGE>
offer this type of credit, when such credit is available. The table below sets
forth additional information relating to the Company's notes receivable (amounts
in thousands).
 
<TABLE>
<CAPTION>
                                                                                      YEAR ENDED
                                                                                     DECEMBER 31,
                                                                      -------------------------------------------
                                                                          1996           1997           1998
                                                                      -------------  -------------  -------------
<S>                                                                   <C>            <C>            <C>
Notes receivable, gross, secured by Vacation Ownership Interests....  $  21,732,000  $  37,898,000  $  12,762,000
Reserve for loan losses.............................................       (736,000)      (750,000)      (991,000)
                                                                      -------------  -------------  -------------
Notes receivable, net...............................................  $  20,996,000  $  37,148,000  $  11,771,000
                                                                      -------------  -------------  -------------
                                                                      -------------  -------------  -------------
Charge-offs.........................................................  $     448,000  $   1,378,000  $     875,000
                                                                      -------------  -------------  -------------
                                                                      -------------  -------------  -------------
</TABLE>
 
    LOAN UNDERWRITING
 
    Consistent with industry practice, Vacation Ownership Interest financing is
not subject to extensive loan underwriting criteria. Prior to providing such
financing, the Company performs a commercial credit check. While the Company
requires a minimum downpayment of 10% of the purchase price, the Company
encourages purchasers to make increased downpayments by offering a lower
interest rate. In addition, purchasers who do not elect to participate in the
Company's pre-authorized payment plan are charged interest at a rate which is
one percent greater than the otherwise prevailing rate.
 
    COLLECTION POLICIES
 
    The Company bears the risk of purchaser default under its receivables
financing facility. The Company's practice has been to continue to accrue
interest on its loans to purchasers of Vacation Ownership Interests until such
loans are deemed to be uncollectible, at which point it commences foreclosure
proceedings. Upon obtaining title, the Company returns the Vacation Ownership
Interests to inventory for resale. The Company closely monitors its loan
accounts and determines whether to foreclose on a case-by-case basis. If a
purchaser of a Vacation Ownership Interest defaults on the mortgage during the
early part of the loan amortization period, the Company will not have recovered
its marketing, selling (other than certain sales commissions) and general and
administrative costs relating to such Vacation Ownership Interest. In addition,
although in certain jurisdictions the Company may seek recourse against a
defaulting customer for the sales price of a Vacation Ownership Interest, the
Company has not historically pursued such a remedy.
 
SALES OF RECEIVABLES
 
    In September 1998, the Company entered into a $75 million vacation ownership
loan participation facility with a financial institution. Under this facility,
the Company sells its Vacation Ownership Interest Receivables to a limited
purpose, bankruptcy remote subsidiary of the Company, which are then pledged to
the financial institution as security for the funding used by the subsidiary to
acquire the receivables. This facility provides the Company with non-recourse
interim funding for Vacation Ownership Interests receivable pending their
permanent funding through receivables securitization transactions. The Company
expects to be able to fund a significant portion of its future development from
funds provided by this receivables facility.
 
RECEIVABLES SERVICING
 
    Receivables servicing includes collecting payments from borrowers and
remitting such funds to the owners, lenders or investors in such receivables,
accounting for receivables principal and interest, making advances when
required, contacting delinquent borrowers, foreclosing in the event that
defaults are not remedied and performing other administrative duties. The
Company outsources the servicing of its
 
                                       4
<PAGE>
receivables to a third party vendor, and paid aggregate fees of $221,000 and
$228,000 in fiscal 1998 and 1997, respectively. For fiscal 1999, the Company
intends to perform certain collection services through its own personnel.
 
CUSTOMER SERVICE
 
    The Company emphasizes customer satisfaction and maintains full-time
customer service representatives in its King of Prussia, Pennsylvania
headquarters to respond to customer inquiries. At closing, all purchasers are
provided with a toll-free customer service phone number to facilitate any
additional information requests. Customer service surveys are often sent to each
purchaser to measure customer satisfaction and to alert the Company to problems,
if any.
 
COMPETITION
 
    The Company competes with other vacation ownership resort providers as well
as hotels, motels, condominium developments and second homes. Competition is
based primarily upon the attractiveness and location of the resort property and
amenities. In addition to the direct competition of individual resorts, other
competitors also include alternative accommodations such as hotels, motels,
bed-and-breakfasts and small vacation ownership operators located within the
immediate geographic vicinity of each of the Company's resorts.
 
    The vacation ownership industry historically has been highly fragmented and
dominated by a very large number of local and regional resort developers and
operators, each with limited portfolios. More recently, many of the world's most
widely-recognized lodging, hospitality and entertainment companies have begun to
develop and sell timeshare and vacation ownership interests under their brand
names. Many entities with which the Company competes have significantly greater
access to financial, sales and marketing and other resources than those of the
Company and may be able to grow at a more rapid rate or more profitably as a
result. Management anticipates that competition will increase in the future as a
result of consolidation in the vacation ownership industry.
 
VACATION OWNERSHIP EXCHANGE NETWORKS
 
    According to the American Resort Developers Association, the primary reason
cited by consumers for purchasing a Vacation Ownership Interest is the ability
to exchange such interest for accommodations at other resorts through worldwide
exchange networks. Membership in an exchange network allows the owner of a
Vacation Ownership Interest at one of the Company's resorts to exchange their
occupancy right for a similar right at another participating resort, based upon
availability and the payment of a variable exchange fee. A Vacation Ownership
Interest can be exchanged by listing the interest as available with the exchange
network affiliated with the owner's home resort and requesting occupancy at
another participating resort, indicating the preferred resort or geographic
area, the size of the unit desired, and the period during which occupancy is
desired. The exchange network assigns a rating to each listed Vacation Ownership
Interest, which is based upon a number of factors, including the location and
size of the unit, the quality of the resort and the time of year during which
the exchanging owner's Vacation Ownership Interest is available. The network
then attempts to satisfy the exchange request by providing an occupancy right in
a participating resort with a similar rating.
 
    London Bridge Resort and the Daytona Beach Regency are affiliated with
Interval International ("II"), one of the leading worldwide vacation ownership
exchange companies. Participation in II entitles owners to exchange their annual
Vacation Ownership Interests for occupancy at over 1,500 II resorts worldwide.
Both the London Bridge Resort and the Daytona Beach Regency have received
Five-Star designations from II, the highest designation under II's rating
system. II awards this designation to less than 10% of its 1500 member resorts.
The Company's other four newly acquired resorts, the Desert
 
                                       5
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Paradise Resort, the Palm Springs Marquis Villas, Island Links Resort and the
Scottsdale Links Resort recently became affiliated with II, and have not yet
been rated.
 
GOVERNMENT REGULATION
 
    The Company's marketing and sales activities and other resort operations are
subject to extensive regulation by the federal government and the states in
which the Company's resorts are located and in which its Vacation Ownership
Interests are marketed and sold. Federal legislation to which the Company is or
may be subject includes the Federal Trade Commission Act, the Fair Housing Act,
the Truth-in-Lending Act, the Real Estate Settlement Procedures Act, the Equal
Credit Opportunity Act, the Interstate Land Sales Full Disclosure Act, the
Telemarketing and Consumer Fraud and Abuse Prevention Act, and the Civil Rights
Acts of 1964, 1968 and 1991. Many states have adopted legislation as well as
specific laws and regulations regarding the sale of vacation ownership
interests. The laws of most states require a designated state authority to
approve a public report of condominium, a detailed offering statement describing
the Company and all material aspects of the resort and the sale of Vacation
Ownership Interests at such resort. In addition, the laws of most states in
which the Company sells Vacation Ownership Interests grant the purchaser of such
an interest the right to rescind a contract of purchase at any time within a
statutory rescission period, which generally ranges from three to ten days.
Furthermore, most states have other laws which regulate the Company's
activities, such as real estate licensure laws, travel sales licensure laws,
anti-fraud laws, telemarketing laws, prize, gift and sweepstakes laws, labor
laws and various regulations governing access and use of the Company's resorts
by disabled persons. The Company believes that it is in material compliance with
all applicable federal, state, local and foreign laws and regulations to which
it is currently subject.
 
EMPLOYEES
 
    As of December 31, 1998, the Company employed a total of 1,222 full time
employees. None of the Company's employees are represented by a collective
bargaining unit. The Company believes that its relations with its employees are
good.
 
ITEM 2. PROPERTIES
 
    The Company owns and operates six resorts. Set forth below is a description
of each resort property.
 
    LONDON BRIDGE RESORT.  The London Bridge Resort is situated on twelve acres
in Lake Havasu City, Arizona. The resort, formerly a 180 room hotel, currently
consists of 122 studio, one- and two-bedroom suites. The Company commenced a new
construction phase of 193 additional one- and two-bedroom suites in the third
quarter of 1998.
 
    DAYTONA BEACH REGENCY.  The Daytona Beach Regency is located in Daytona
Beach, Florida and currently consists of 72 one- and two-bedroom suites.
Formerly a 198 room hotel, the Company has renovated 72 of the resort's 90
vacation ownership suites, and has or will complete the conversion of the
remaining 18 suites during the first and second quarters of 1999.
 
    SCOTTSDALE LINKS RESORT.  The Scottsdale Links Resort is located on the TPC
golf courses in Scottsdale, Arizona, and Scottsdale Links Resort offers 228
one-, two- and three-bedroom suites.
 
    DESERT PARADISE RESORT.  The Desert Paradise Resort is located one and
one-half miles west of the Las Vegas Strip in Las Vegas, Nevada. The resort
consists of 152 one- and two-bedroom suites.
 
    PALM SPRINGS MARQUIS VILLAS.  Located on seven acres in downtown Palm
Springs, California, the Palm Springs Marquis Villas consists of 101 one- and
two-bedroom suites.
 
                                       6
<PAGE>
    ISLAND LINKS RESORT.  Located on Hilton Head Island off the coast of South
Carolina, the Island Links Resort currently consists of 36 one-and two-bedroom
suites. The Company expects to complete development of a total of 124 additional
one- and two-bedroom suites at the resort. Such construction commenced in the
third quarter of 1998 and will be completed in phases of eight to nine suites
each.
 
    The Company also leases two off-site sales centers located in Philadelphia,
Pennsylvania and Fresno, California.
 
ITEM 3. LEGAL PROCEEDINGS
 
    The Company is not presently involved in any material legal proceedings.
However, from time to time during the ordinary course of business, the Company
is threatened with, or may become a party to legal actions and other proceedings
incidental to its business. The Company believes that its potential exposure to
such legal actions is adequately covered by its general liability insurance.
 
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
    No matter was submitted during the fourth quarter of the fiscal year covered
by this report to a vote of the Company's security holders. During the first
quarter of 1999 certain amendments to the Indenture and Security Agreement were
agreed to in order to reflect the vacation club structure.
 
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
 
    The Company is a limited liability company and has no equity securities that
trade.
 
                                       7
<PAGE>
ITEM 6. SELECTED FINANCIAL DATA
 
                            SELECTED FINANCIAL DATA
 
    The following table sets forth selected financial data of the Company. The
selected consolidated financial data as of and for the four years ended December
31, 1998 have been derived from audited financial statements. The selected
financial data presented below for the year ended December 31, 1994 has been
derived from unaudited financial statements. The unaudited financial statements
include all adjustments, consisting only of normal recurring adjustments, which
the Company considers necessary for a fair presentation of its financial
position and results of operations for this period. The following selected
financial data should be read in conjunction with "Management's Discussion and
Analysis of Results of Operations and Financial Condition" and the consolidated
financial statements of the Company and related notes thereto appearing
elsewhere herein.
 
<TABLE>
<CAPTION>
                                                      AS OF OR FOR THE YEAR ENDED DECEMBER 31,
                                                -----------------------------------------------------
                                                  1994       1995       1996       1997       1998
                                                ---------  ---------  ---------  ---------  ---------
                                                  (DOLLARS IN THOUSANDS, EXCEPT AVERAGE SALES PRICE
                                                                        DATA)
<S>                                             <C>        <C>        <C>        <C>        <C>
INCOME STATEMENT DATA:
Revenues:
Sales of vacation ownership interests.........  $   8,110  $   8,290  $  10,584  $  29,967  $  36,344
Resort operations.............................      5,592      5,029      6,074      6,652      7,772
Gains on sales of receivables.................         --         --         --         --     10,232
Interest income and other.....................         51        704      1,208      3,672      5,926
                                                ---------  ---------  ---------  ---------  ---------
      Total revenues..........................     13,753     14,023     17,866     40,291     60,274
Cost of sales--vacation ownership interests...      3,008      3,154      3,544      7,337      8,075
Resort operations expense.....................      4,217      4,103      4,806      4,599      7,067
Selling and marketing expenses................      3,104      3,452      4,307     11,574     15,146
General and administrative expenses...........      1,385      1,322      2,014      3,188      6,591
Depreciation..................................        586        644        799        772        652
Provision for losses..........................        458        474        492      1,391      1,116
Financing and closing costs...................        271        460        323        868      1,055
Interest expense..............................        502        894      2,143      3,748     12,107
                                                ---------  ---------  ---------  ---------  ---------
Income (loss) before minority interest and
  extraordinary item..........................        222       (480)      (562)     6,814      8,465
Minority interest.............................         --         --       (473)     1,676      1,190
                                                ---------  ---------  ---------  ---------  ---------
Income (loss) before extraordinary item.......        222       (480)       (89)     5,138      7,275
Extraordinary gain (loss) on settlement of
  debt........................................         --      5,077         --         --     (5,364)
                                                ---------  ---------  ---------  ---------  ---------
Net income (loss).............................  $     222  $   4,597  $     (89) $   5,138  $   1,911
                                                ---------  ---------  ---------  ---------  ---------
                                                ---------  ---------  ---------  ---------  ---------
OTHER DATA AND CREDIT STATISTICS:
Number of resorts at period end...............          1          1          2          2          6
Average sales price of vacation ownership
  interests sold..............................  $  10,657  $  11,157  $  12,466  $  11,692  $  12,430
Number of vacation ownership interests sold...        761        743        849      2,563      2,924
 
BALANCE SHEET DATA:
Mortgages receivable, net.....................  $     801  $   7,641  $  20,996  $  37,148  $  11,771
Inventory, net................................     14,620     12,032     12,741      7,963     73,042
Total assets..................................     24,476     28,269     43,034     56,288    146,773
Senior secured notes payable..................         --         --         --         --    127,432
Notes payable.................................     18,399     18,780     34,009     42,891        621
Warrants......................................         --         --         --         --      2,757
Member's equity...............................      5,316      8,763      8,163     10,578     11,986
</TABLE>
 
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
  OF OPERATIONS
 
OVERVIEW
 
    The following represents a discussion of Epic Resorts, LLC, as successor to
Epic Resorts, Inc. The information presents all of the operations of the
Company's resorts as of their respective dates of acquisition, including:
 
<TABLE>
<CAPTION>
RESORT PROPERTY                                                                 DATE ACQUIRED
-----------------------------------------------------------------------------  ---------------
<S>                                                                            <C>
London Bridge Resort.........................................................       1989
Daytona Beach Regency........................................................    1991/1998*
Scottsdale Links Resort......................................................   June 30, 1998
Desert Paradise Resort.......................................................   June 30, 1998
Palm Springs Marquis Villas..................................................   June 30, 1998
Island Links Resort..........................................................   July 8, 1998
</TABLE>
 
------------------------
 
*   On July 8, 1998 the Company acquired the remaining minority partners'
    interests in Daytona Beach Regency and now owns 100% of this resort.
 
    The Company generates revenues from the sale and financing of Vacation
Ownership Interests at its resorts, as well as from resort operations which
include commercial rentals, food and beverage sales, green fees, rentals of
suites available at the Company's resorts and from fees associated with managing
the vacation ownership resorts.
 
    The Company recognizes revenue from Vacation Ownership Interest sales when a
minimum of 10% of the sales price has been received in cash, the refund or
rescission period has expired, collectibility of the receivable representing the
remainder of the sales price is reasonably assured and the Company has completed
substantially all of its obligations with respect to any development relating to
the Vacation Ownership Interests sold.
 
    The Company has been dedicating greater resources to the acquisition and
development of vacation ownership projects. Costs associated with the
acquisition and development of vacation ownership resorts, including carrying
costs, are capitalized as inventory and allocated to cost of sales as the
respective revenue is recognized.
 
    At each of the Company's resorts, a Homeowners Association (each an
"Association") has been established. Each Association is a not-for-profit
corporation and operates primarily to collect the assessments from its members
and remit to the developer of the property the Association's pro-rata share of
direct and allocated expenditures including real estate taxes, property
insurance, grounds maintenance, utility costs and housekeeping services.
Typically, the Association reimburses the developer or property manager for the
Association's pro-rata share of such expenditures.
 
RESULTS OF OPERATIONS
 
    The following analysis summarizes the significant changes in the results of
operations and financial condition of the Company and should be read in
conjunction with the Company's consolidated financial statements and related
notes.
 
COMPARISON OF THE YEAR ENDED DECEMBER 31, 1998 TO YEAR ENDED DECEMBER 31, 1997
 
    REVENUES.  For the year ended December 31, 1998, the Company recognized
total revenues of $60.3 million compared to $40.3 million for the year ended
December 31, 1997, an increase of $20.0 million, or 49.6%. This increase was
primarily the result of $10.2 of gains recognized in 1998 from the sales of
mortgages receivable and a $6.3 million increase in sales of Vacation Ownership
Interests to $36.3 million during 1998 from $30.0 million during 1997, an
increase of 21.0%.
 
                                       9
<PAGE>
    Sales of Vacation Ownership Interests increased primarily as a result of (i)
increased sales growth at the Daytona Beach Regency Resort to $17.4 million
during 1998 from $14.6 million during 1997, an increase of $2.8 million or 19.2%
and (ii) $3.3 million of sales generated from the new sales activities at the
Island Links Resort and the Philadelphia offsite sales center.
 
    Resort operations revenue increased 16.4%, to $7.8 million in 1998 from $6.7
million in 1997, primarily as a result of additional resort revenues of $1.6
million during 1998 from the newly acquired resorts and the sale of vacation
packages of $0.2 million by Epic Marketing, a new venture started in the fourth
quarter of 1998. This increase was offset by a $0.6 million decrease in resort
operations revenue at London Bridge Resort and the Daytona Beach Regency Resort
which reflects the decreasing availability of suites for rent in 1998 as the
Company continues to convert suites at these resorts to Vacation Ownership
Interests.
 
    Gains on sales of receivables of $10.2 million relate to the Company's
initial fundings in October, November and December 1998 under its Receivables
Facility as discussed in Note 3 to the Company's consolidated financial
statements.
 
    Interest income increased $2.0 million to $5.5 million in 1998 from $3.5
million in 1997, an increase of 57.1%, primarily from investing a portion of the
proceeds from the sale of the Notes into short-term investments.
 
    Other income increased $0.3 million to $0.4 million in 1998 from $0.1
million in 1997 primarily attributable to the $0.2 million of Ambassador Club
activity. Ambassador Club sales provide a limited package of visits for a
moderate price to customers who cannot commit to a full purchase obligation.
 
    COST OF SALES.  Cost of sales as a percentage of sales of Vacation Ownership
Interests decreased to 22.3% in 1998 from 24.3% in 1997, reflecting higher
average selling prices for Vacation Ownership Interests at London Bridge Resort
and Daytona Beach Regency.
 
    RESORT OPERATIONS EXPENSE.  Resort operations expense increased
approximately $2.5 million to $7.1 million in 1998 from $4.6 million in 1997. As
a percentage of resort operations revenue, resort operations expense increased
to 91.0% in 1998 from 68.7% in 1997 primarily as a result of increased
operational expenses of $2.1 million from the newly acquired resorts.
 
    SELLING AND MARKETING EXPENSES.  Selling and marketing expenses (including
commissions) as a percentage of sales of Vacation Ownership Interests increased
to 41.6% in 1998 from 38.7% in 1997. In 1998, the Company incurred $476,000 in
start-up selling and marketing expenses as it prepared for the (i) commencement
of selling efforts at the three new western locations in the first quarter of
1999 and (ii) opening of its offsite sales center in Philadelphia in the middle
of the fourth quarter of 1999. As part of the Company's development of its
marketing strategy, the Company also incurred approximately $400,000 to
implement a comprehensive marketing effort on the East Coast.
 
    GENERAL AND ADMINISTRATIVE EXPENSES.  General and administrative expenses
increased 106.3% to $6.6 million in 1998 from $3.2 million in 1997 reflecting
the Company's growth and the newly acquired resorts in 1998. As a percentage of
total revenues, general and administrative expenses increased to 10.9% in 1998
from 7.9% in 1997 which was attributable to the increased staffing and start-up
costs incurred prior to the commencement of sales operations at the newly
acquired resorts. As part of the Company's growth plan, the Company increased
general and administrative expenses at its headquarters by $1.3 million to have
in place the infrastructure required to support the addition of its four new
resorts and its additional offsite sales center. The Company continues to
evaluate its administrative support and expects to continue to increase its
investment in resources to support its anticipated growth.
 
    INTEREST EXPENSE.  Interest expense increased to $12.1 million in 1998 from
$3.7 million in 1997, an increase of $8.4 million, which reflects the increased
indebtedness from the Notes issued in July 1998.
 
                                       10
<PAGE>
    PROVISION FOR LOAN LOSSES.  Provision for loan losses as a percentage of
sales of Vacation Ownership Interest decreased to 3.0% in 1998 from 4.6% in
1997. This decrease was attributable to the lower receivables base resulting
from the sales of mortgages receivable through the Receivables Facility.
 
COMPARISON OF THE YEAR ENDED DECEMBER 31, 1997 TO YEAR ENDED DECEMBER 31, 1996
 
    REVENUES.  For the year ended December 31, 1997, the Company recognized
total revenues of $40.3 million compared to $17.9 million for the year ended
December 31, 1996, an increase of $22.4 million, or 125.1%. This increase was
primarily the result of a $19.4 million increase in sales of Vacation Ownership
Interests to $30.0 million during 1997 from $10.6 million during 1996, an
increase of 183.0%. Of this increase, $14.0 million was attributable to the
acquisition of the Daytona Beach Regency and $5.5 million was attributable to
increased sales volume at the London Bridge Resort.
 
    Sales of Vacation Ownership Interests increased primarily as a result of (i)
an increase in the number of Vacation Ownership Interests sold at London Bridge
Resort from 794 in 1996 to 1,204 in 1997 and (ii) a full year of operations at
the Daytona Beach Regency compared to only two months of operations in 1996.
 
    Interest income and other increased 191.7% to $3.5 million in 1997 from $1.2
million in 1996 due to a 76.7% increase in the principal amount of net customer
mortgages receivable from $21.0 million to $37.1 million, and an increase in the
average yield on the Company's customer mortgages receivable portfolio to 14.9%
from 14.4%.
 
    Resort operations revenue increased 9.8%, to $6.7 million in 1997 from $6.1
million in 1996, as a result of increased suite rentals and retail operations at
London Bridge Resort and the acquisition of the Daytona Beach Regency.
 
    COST OF SALES.  Cost of sales as a percentage of sales of Vacation Ownership
Interests decreased to 24.4% in 1997 from 33.5% in 1996, reflecting higher
average selling prices for Vacation Ownership Interests at London Bridge Resort
and the lower cost inventory acquired at Daytona Beach Regency.
 
    RESORT OPERATIONS EXPENSE.  Resort operations expense as a percentage of
resort operations revenue decreased to 69.1% in 1997 from 79.1% in 1996
primarily as a result of increased reimbursements from the Associations.
 
    SELLING AND MARKETING EXPENSES.  Selling and marketing expenses (including
commissions) as a percentage of sales of Vacation Ownership Interests declined
to 38.7% in 1997 from 40.7% in 1996. This decrease was primarily the result of
increases in the average sales prices of Vacation Ownership Interests and the
development of more efficient sales and marketing programs.
 
    GENERAL AND ADMINISTRATIVE EXPENSES.  General and administrative expenses
increased 60.0% to $3.2 million in 1997 from $2.0 million in 1996, primarily as
a result of additional employee costs incurred in generating increased sales
volumes, offset by the effect of the leveraging of these costs over a larger
revenue base. However, as a percentage of total revenues, these costs decreased
to 7.9% in 1997 from 11.2% in 1996. The $1.2 million increase in general and
administrative expenses was primarily the result of additional employee expenses
incurred in generating increased sales volume and the acquisition of the Daytona
Beach Regency, as previously discussed.
 
    INTEREST EXPENSE.  Interest expense increased to $3.7 million in 1997 from
$2.1 million in 1996. This 76.2% increase reflects higher levels of borrowings
to fund growth in the Company's operations. The average outstanding balance of
interest-bearing debt increased to $38.4 million in 1997 from $26.4 million in
1996. The weighted average interest rate for the Company's financing
arrangements secured by notes receivable was 10.7% and 10.8% in 1997 and 1996,
respectively.
 
    PROVISION FOR LOAN LOSSES.  Provision for loan losses remained relatively
constant at 4.7% of sales of Vacation Ownership Interests in 1997 and 1996.
 
                                       11
<PAGE>
CHANGES IN FINANCIAL CONDITION
 
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996
 
    Cash and cash equivalents increased by $15.8 million and $0.2 million for
the years ended December 31, 1998 and 1997, respectively, and decreased $0.1
million for the year ended December 31, 1996.
 
    Net cash used in operating activities was $74.2 million and $3.5 million in
1998 and 1997, respectively. Net cash provided by operating activities was $0.1
million in 1996. The change in net cash used in operating activities from 1997
to 1998 is primarily attributable to the acquisition of the four additional
resorts for a cash purchase price of $64.0 million during 1998. The change in
net cash used in operating activities from 1996 to 1997 is primarily
attributable to the increase in net income and the net change in inventory,
which included a net decrease of $4.7 million in 1997 (due primarily to
increased sales activity) and a net increase in 1996 of $0.7 million (due
primarily to conversion activity in excess of sales at Daytona Beach Regency).
 
    Net cash used in investing activities was $17.8 million, $2.3 million and
$1.5 million in 1998, 1997 and 1996, respectively. The increase from 1997 to
1998 is primarily attributable to the $15.2 million investment in residual
interests associated with the sales of receivables through the Receivables
Facility. The increase from 1996 to 1997 is primarily attributable to the
refurbishing of the onsite restaurant at the London Bridge Resort, and the
construction of a pool, exercise facility and lounge area at the Daytona Beach
Regency during 1997.
 
    Net cash provided by financing activities was $107.9 million, $6.0 million
and $1.5 million in 1998, 1997 and 1996, respectively. The net increase in cash
provided by financing activities from 1997 to 1998 is primarily attributable to
the $130.0 million proceeds received on July 8, 1998 from the sale of the Notes,
which was used to purchase the new resorts as discussed above, and the payoff of
$23.8 million of outstanding debt and the payment of $6.7 million of deferred
financing costs. The net increase in cash provided by financing activities from
1996 to 1997 is primarily attributable to the increased borrowings through
mortgage indebtedness. The net decrease in cash provided by financing activities
from 1997 to 1996 is primarily attributable to additional distributions to the
Company's sole stockholder in 1997 totalling $1.8 million.
 
LIQUIDITY AND CAPITAL RESOURCES
 
    The Company generates cash from operations through the sale and financing of
Vacation Ownership Interests, resort operations, transient rental of resort
accommodations and management fees. With respect to the sale of Vacation
Ownership Interests, the Company generates cash from operations from customer
downpayments and third party financing of customer mortgages receivable in
amounts typically equal to 90% of the related customer mortgages receivable. The
Company generates additional cash from the financing of Vacation Ownership
Interests equal to the difference between the interest charged on the customer
mortgages receivable and the interest paid on the notes payable secured by the
Company's pledge of such customer mortgages receivable. The Company will
generate additional cash flow from its Vacation Ownership Interests receivable
portfolio through receipt of the spread between the yield on such portfolio and
the cost of the Receivables Facility upon completion of securitizations of such
receivables.
 
    The Company requires funds to finance the acquisition and development of
resorts and related inventory, and to finance customer purchases of Vacation
Ownership Interests. Historically, these funds have been provided by
indebtedness secured by a portion of the Company's inventory of unsold Vacation
Ownership Interests, customer mortgages receivable and other assets. In October
1998, this existing receivables facility was repaid and terminated with the
proceeds from the Receivables Facility.
 
    In September 1998, the Company entered into a non-recourse $75 million
vacation ownership loan participation facility with a financial institution (the
"Receivables Facility"). Under this facility, the Company sells its Vacation
Ownership Interest receivables to a limited purpose, bankruptcy remote
subsidiary of the Company, which are then pledged to the financial institution
as security for the funding
 
                                       12
<PAGE>
used by the subsidiary to acquire the receivables. The Receivables Facility
provides for advance rates of 88% of the lesser of (i) unpaid principal balance
of the receivables sold to the subsidiary or (ii) the market value of such
receivables as determined by the financial institution. Borrowings under the
Receivables Facility bear interest at one month LIBOR plus 1.50%, reset daily.
The Receivables Facility provides the Company with non-recourse interim funding
for the Vacation Ownership Interests receivables pending their permanent funding
through receivables securitization transactions. The Company expects to be able
to fund a significant portion of its future development from funds provided by
the Receivables Facility.
 
    The Company's capital resources are provided from the following sources: (i)
cash flows from operations, (ii) proceeds from the Receivables Facility and
(iii) remaining proceeds from the sale of the Notes designated for working
capital and general corporate purposes. In addition, $16.9 million of the net
proceeds of the Offering, representing an amount equal to the first two interest
payments under the Notes, was placed into an escrow account to be held by an
escrow agent for the benefit of the holders of the Notes to pay interest on the
Notes. The escrow funds were disbursed to make the first interest payment of
$7.4 million due December 15, 1998. Thereafter, the Company must at all times
maintain escrow funds in this escrow account sufficient to make the next
required interest payment of $8.5 million on the Notes.
 
    The Company intends to pursue a growth-oriented strategy; accordingly, the
Company may, from time to time acquire, among other things, additional vacation
ownership resorts and additional land upon which vacation ownership resorts may
be developed, and companies operating quality resorts or having vacation
ownership assets, management, sales or marketing expertise commensurate with the
Company's operations in the vacation ownership industry.
 
    The Company believes that the remaining net proceeds from the sale of the
Notes designated for working capital and general corporate purposes, together
with cash generated from operations and future borrowings, will be sufficient to
meet the Company's working capital and capital expenditure needs through the end
of the fiscal year. The Company may, in the future, require additional credit
facilities or issuances of other corporate debt or equity securities in
connection with acquisitions or otherwise. Any debt incurred or issued by the
Company may be secured or unsecured, at fixed or variable rates of interest and
may be subject to such terms as management deems prudent. The Company's credit
facilities and the indenture for the Notes include customary conditions to
funding, eligibility requirements for collateral, certain financial and other
affirmative and negative covenants, including, among others, limits on the
incurrence of indebtedness, covenants concerning net worth and fixed charge
coverage requirements and debt to equity ratios and events of default.
 
YEAR 2000
 
    The Year 2000 issue is a flaw in many electronic data processing systems
which prevents them from processing year-date data accurately beyond the year
1999. This is the result of using a two-digit representation for the year, for
example "99" for "1999". This approach assumed that the first two digits of the
abbreviated date are "19". However, when the computer reaches 2000 it may
interpret "00" as the year 1900 possibly causing inaccurate data processing or
processing to stop altogether.
 
    The Company is addressing the Year 2000 issue with a corporate wide
initiative led by the Director of Information Systems and involving the
Company's Risk Manager. The initiative includes ascertaining that each of the
software packages in use have been certified Year 2000 compliant.
 
    The Company has conducted tests of its existing computer hardware and
determined that is Year 2000 compliant. Because most of its computer hardware
and software is less than two years old, and the fact that each of the software
packages have already been certified as compliant, the Company believes that its
exposure to Year 2000 problems with respect to this hardware and software is
minimal. The Company is actively working with its suppliers and third party
service providers, including its receivable servicing providers and the vacation
ownership exchange networks with which it is affiliated, to assess their
compliance efforts, as well as the Company's potential exposure to the failure
of such suppliers and third
 
                                       13
<PAGE>
party service providers to become Year 2000 compliant. In the case of its
receivables servicing providers, the Company has received representations that
they have completed their remediation program and will be providing a
certificate that they are Year 2000 compliant.
 
    At each of the locations, the general manager has been advised that the
resort's suppliers are Year 2000 compliant or that such suppliers have taken the
necessary steps to become compliant before the end of 1999.
 
    While the Company believes that such exposure is minimal, there can be no
assurance that the systems of suppliers or third party service providers are
Year 2000 compliant, or that the failure of such suppliers or third party
service providers to be Year 2000 compliant will not have a material adverse
effect on the Company.
 
FORWARD LOOKING STATEMENTS
 
    From time to time, information the Company provides, statements by the
Company's employees or information included in its filings with the Securities
and Exchange Commission (including those portions of the Management's Discussion
and Analysis that refer to the future) may contain forward-looking statements
that are not historical facts. Those statements are "forward-looking" within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements, and the Company's future performance, operating
results, financial position and liquidity, are subject to a variety of factors
that could materially affect results, including:
 
    - THE COMPANY'S OPERATING MARGINS WILL BE LOWER AS ITS NEWLY ACQUIRED
RESORTS ARE INTEGRATED
 
    A principal component of the Company's strategy is to continue to grow by
acquiring additional vacation ownership projects, existing resorts from third
party operators or the land on which to develop vacation ownership resorts.
 
    To successfully implement this business strategy, the Company must first
integrate its newly acquired resorts into its existing sales and marketing
programs. Initial sales prices are typically below market to allow the Company
to attract customers and establish market share. As a result, the Company's
operating margins are likely to be lower until prices increase. The lower
margins could be substantial and could negatively impact the Company's cash
flow. No assurances can be given that the Company's operating margins will be
maintained or improved as its resorts achieve maturity or that new resorts will
not reduce the Company's overall operating margins.
 
    - THE COMPANY HAS HAD LIMITED EXPERIENCE IN THE CONCURRENT DEVELOPMENT AND
OPERATION OF MULTIPLE RESORTS
 
    The Company has undertaken the development, marketing and sales of Vacation
Ownership Interests at its four newly-acquired resorts in addition to the
continued operation and new phase development at its two existing resorts. This
rapid expansion has placed, and will continue to place, significant pressure on
the Company's managerial, operational and financial systems. To manage its
growth, the Company must continue to strengthen its management team, implement
and improve its operational and financial systems and expand, train and manage
its employee base. The Company also will be required to develop and manage
multiple relationships with site operators, advertisers, suppliers and other
third parties. The Company's future operating results will also depend on its
ability to expand its sales and marketing organization, to penetrate markets and
to expand its support organization. Failure to effectively manage growth could
have a material adverse effect on the Company's business, operating results and
financial condition.
 
    - THE VACATION OWNERSHIP INDUSTRY IS HIGHLY SENSITIVE TO CHANGES IN NATIONAL
AND REGIONAL ECONOMIC CONDITIONS
 
    Changes in economic conditions such as reductions in levels of employment,
discretionary disposable income, consumer confidence, available financing as
well as any increase in interest rates will affect the
 
                                       14
<PAGE>
Company's sales of Vacation Ownership Interests. A downturn in the economy in
general or in the market for vacation ownership property could have a material
adverse effect on the Company's business, operating results and financial
condition.
 
    - CUSTOMERS MAY NOT BE ABLE TO REPAY LOANS MADE BY THE COMPANY FOR THE
PURCHASE OF VACATION OWNERSHIP INTERESTS
 
    General economic conditions have an impact on the ability of borrowers to
repay loans. Loss of earnings, illness and other similar factors affecting
borrowers may lead to an increase in delinquencies. If the vacation ownership
market should experience an overall decline in values such that the outstanding
balances of the Company's notes receivable are greater than the value of the
respective Vacation Ownership Interests, the actual rates of delinquencies,
foreclosures and losses could be materially higher than those now experienced.
An increase in delinquency rates or defaults on the Company's receivables could
have a material adverse effect on the Company's business, operating results and
financial condition as well as the Company's ability to obtain financing under
the Receivables Facility or any other pledged receivables facility. In addition,
if a purchaser of a Vacation Ownership Interest defaults early in the repayment
schedule, the costs associated with marketing and sales commissions may not be
recouped, and similar costs and commissions will be incurred in connection with
the resale of such Vacation Ownership Interest after the Company regains
possession of that Vacation Ownership Interest. The Company may also incur
substantial costs and delays in connection with the servicing of its
receivables, including costs in foreclosing or realizing on its collateral and
additional marketing and sales costs with respect to reacquired property.
 
    - THE COMPANY HAS SUBSTANTIAL LEVERAGE AND MAY NOT BE ABLE TO SERVICE ITS
DEBT
 
    The Company has significant debt service obligations. The Company
anticipates that it will continue to require external sources of liquidity to
support its operations in the future. The Company's ability to pay cash
dividends, to repay subordinated debt and to make certain investments exceeding
50% of the Company's consolidated net income is also limited by certain
restrictions.
 
    The Company's ability to service or to refinance its indebtedness or to
obtain additional financing (including its ability to consummate future notes
receivable securitizations) depends on its future performance, which is subject
to a number of factors, including the Company's results of operations, leverage,
financial condition and business prospects, the performance of its receivables,
prevailing interest rates, general economic conditions and perceptions about the
vacation ownership industry. The Receivables Facility includes, among other
things, various representations and warranties, conditions to funding,
eligibility requirements for collateral, affirmative, negative and financial
covenants and events of default. Specifically, the Company must maintain a
Tangible Net Worth (as defined in the Receivables Facility) of at least $10.0
million and must meet all financial covenants contained in the indenture under
which the Notes were issued.
 
    The Company's level of debt and debt service requirements will have several
important effects on its future operations, including the following:
 
    - the Company will have significant cash requirements to service debt,
      reducing funds available for operations and future business opportunities
      as well as increasing the Company's vulnerability to adverse economic and
      industry conditions;
 
    - the Company's leveraged position will increase its vulnerability to
      competitive pressures;
 
    - the financial covenants and other restrictions contained in the indenture
      governing the Notes and other agreements relating to the Company's
      indebtedness will require the Company to meet certain financial tests and
      will restrict its ability to, among other things, borrow additional funds,
      dispose of assets or pay cash dividends on, or repurchase, preferred or
      common stock; and
 
                                       15
<PAGE>
    - funds available for working capital, capital expenditures, acquisitions
      and general corporate purposes may be limited.
 
    - THE COMPANY MAY EXPERIENCE A FLUCTUATION IN QUARTERLY RESULTS DUE TO AN
INCREASE OR DECREASE IN THE NUMBER OF VACATION OWNERSHIP PROJECTS SUBJECT TO
PERCENTAGE OF COMPLETION ACCOUNTING
 
    The percentage of completion method of accounting requires net profit on
such projects to be recognized on a pro rata basis as development is completed.
The Company may experience delays in bringing inventories to market due to
delays in obtaining required regulatory approvals to sell Vacation Ownership
Interests or otherwise, resulting in decreased revenues and increased interest
expense and carrying charges.
 
    - THE TIMING, QUALITY AND COMPLETION OF CONSTRUCTION AND DEVELOPMENT
ACTIVITIES AT THE COMPANY'S RESORTS ARE CONTROLLED BY THIRD PARTY CONTRACTORS
AND THE AVAILABILITY OF GOVERNMENTAL PERMITS AND AUTHORIZATIONS
 
    Development activities are also subject to risks relating to the inability
to obtain, or delays in obtaining, all necessary zoning, land-use, building,
occupancy, sales and other required governmental permits and authorizations, the
ability of the Company to coordinate construction activities with the process of
obtaining such permits and authorizations, and the ability of the Company to
obtain the financing necessary to complete the necessary acquisition,
construction, and/or conversion work at its projects and resorts. The failure to
obtain or maintain such zoning permits would have a material adverse effect on
the Company's business, results of operations and financial condition. In
addition, certain state and local laws may impose liability on property
developers with respect to construction defects discovered or repairs made by
future owners of such property.
 
    - NATURAL DISASTERS COULD HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY
 
    The Company's resorts are located in areas that are susceptible to wind
storms, hurricanes, floods, mud slides, earthquakes, and other natural
disasters. The Company's resorts could suffer significant damage as a result of
storms or natural disasters. Any such damage could impair the Company's ability
to sell Vacation Ownership Interests at its resorts, and to collect on
outstanding notes receivable arising from such sales and significantly adversely
affect the Company's business, operating results and financial condition.
 
    - APPLICABILITY OF FEDERAL SECURITIES LAWS TO THE SALE OF VACATION OWNERSHIP
INTERESTS
 
    It is possible that the Vacation Ownership Interests may be deemed to be a
security as defined in Section 2(1) of the Securities Act of 1933. If the
Vacation Ownership Interests were determined to be a security for such purpose,
their sale would require registration under the Securities Act. The Company has
not registered the sale of the Vacation Ownership Interests under the Securities
Act and does not intend to do so in the future. If the sale of the Vacation
Ownership Interests were found to have violated the registration provisions of
the Securities Act, purchasers of the Vacation Ownership Interests would have
the right to rescind their purchases of Vacation Ownership Interests. If a
substantial number of purchasers sought rescission and were successful, the
Company's business, results of operations and financial condition could be
materially adversely affected. Because of the nature of the Company's Vacation
Ownership Interest program and the sales practices utilized in such program, the
Company does not believe that its Vacation Ownership Interests constitute a
security within the meaning of Section 2(1) of the Securities Act.
 
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
    The Company is not exposed to interest rate risk in the near term, as
substantially all of the Company's indebtedness is at fixed rates (principally
the $130 million of senior secured notes which bear interest at a fixed rate of
13.0%). The Company does not maintain a trading account for any class of
financial instrument, has never purchased any derivative instruments, and is not
directly subject to any foreign currency exchange or commodity price risk.
 
                                       16
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 
                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
 
To the Member of Epic Resorts, LLC:
 
    We have audited the accompanying consolidated balance sheets of Epic
Resorts, LLC (a Delaware limited liability company) as of December 31, 1998 and
1997, and the related consolidated statements of operations, cash flows and
changes in member's equity for each of the three years in the period ended
December 31, 1998. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
 
    We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
 
    In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Epic Resorts,
LLC as of December 31, 1998 and 1997, and the results of their operations and
their cash flows for each of the three years in the period ended December 31,
1998, in conformity with generally accepted accounting principles.
 
                                          /s/ Arthur Andersen LLP
 
Philadelphia, Pennsylvania
March 25, 1999
 
                                       17
<PAGE>
                               EPIC RESORTS, LLC
 
                          CONSOLIDATED BALANCE SHEETS
 
<TABLE>
<CAPTION>
                                                                                     DECEMBER 31,   DECEMBER 31,
                                                                                         1998           1997
                                                                                    --------------  -------------
<S>                                                                                 <C>             <C>
                                                     ASSETS
Cash and cash equivalents.........................................................  $   16,095,000  $     248,000
Cash in escrow (Notes 2 and 6)....................................................       8,586,000         53,000
Investment in residual interests (Note 3).........................................      15,223,000             --
Mortgages receivable, net of allowance of $991,000 and $750,000 as of December 31,
  1998 and 1997, respectively (Note 3)............................................      11,771,000     37,148,000
Inventory (Note 4)................................................................      73,042,000      7,963,000
Property and equipment, net of accumulated depreciation of $4,303,000 and
  $3,553,000 as of December 31, 1998 and 1997, respectively (Note 5)..............      11,909,000      9,971,000
Deferred financing costs, net of accumulated amortization of $692,000 and $405,000
  as of December 31, 1998 and 1997, respectively..................................       6,823,000        677,000
Other assets (Note 7).............................................................       3,324,000        228,000
                                                                                    --------------  -------------
      Total assets................................................................  $  146,773,000  $  56,288,000
                                                                                    --------------  -------------
                                                                                    --------------  -------------
                                         LIABILITIES AND MEMBER'S EQUITY
Accounts payable..................................................................  $    1,154,000  $     984,000
Accrued expenses..................................................................       1,743,000        496,000
Accrued interest payable..........................................................         736,000         81,000
Advance deposits..................................................................          76,000         53,000
Deferred revenue..................................................................         268,000             --
Notes payable (Notes 6 and 7).....................................................         621,000     42,891,000
Senior secured notes payable (Note 6).............................................     127,432,000             --
                                                                                    --------------  -------------
      Total liabilities...........................................................     132,030,000     44,505,000
                                                                                    --------------  -------------
Minority interest (Note 1)........................................................              --      1,205,000
Commitments and contingencies (Note 8)
Warrants (Note 6).................................................................       2,757,000             --
Member's equity...................................................................      11,986,000     10,578,000
                                                                                    --------------  -------------
      Total liabilities and member's equity.......................................  $  146,773,000  $  56,288,000
                                                                                    --------------  -------------
                                                                                    --------------  -------------
</TABLE>
 
   The accompanying notes are an integral part of these financial statements.
 
                                       18
<PAGE>
                               EPIC RESORTS, LLC
 
                     CONSOLIDATED STATEMENTS OF OPERATIONS
 
<TABLE>
<CAPTION>
                                                                            FOR THE YEAR ENDED DECEMBER 31,
                                                                      -------------------------------------------
                                                                          1998           1997           1996
                                                                      -------------  -------------  -------------
<S>                                                                   <C>            <C>            <C>
Revenue:
  Sales of vacation ownership interests.............................  $  36,344,000  $  29,967,000  $  10,584,000
  Resort operations.................................................      7,772,000      6,652,000      6,074,000
  Gains on sales of receivables (Note 3)............................     10,232,000             --             --
  Interest income...................................................      5,499,000      3,535,000      1,208,000
  Other income......................................................        427,000        137,000             --
                                                                      -------------  -------------  -------------
                                                                         60,274,000     40,291,000     17,866,000
                                                                      -------------  -------------  -------------
Costs and expenses:
  Cost of sales of vacation ownership interests (Note 4)............      8,075,000      7,337,000      3,544,000
  Resort operations.................................................      7,067,000      4,599,000      4,806,000
  Selling and marketing costs.......................................     15,146,000     11,574,000      4,307,000
  General and administrative........................................      6,591,000      3,188,000      2,014,000
  Provision for doubtful accounts...................................      1,116,000      1,392,000        492,000
  Depreciation (Note 5).............................................        652,000        771,000        799,000
  Financing and closing costs.......................................      1,055,000        868,000        323,000
  Interest expense (Note 6).........................................     12,107,000      3,748,000      2,143,000
                                                                      -------------  -------------  -------------
                                                                         51,809,000     33,477,000     18,428,000
                                                                      -------------  -------------  -------------
Income (loss) before minority interest and extraordinary item.......      8,465,000      6,814,000       (562,000)
Minority interest...................................................      1,190,000      1,676,000       (473,000)
                                                                      -------------  -------------  -------------
Income (loss) before extraordinary item.............................      7,275,000      5,138,000        (89,000)
Extraordinary losses on extinguishment of debt (Note 6).............      5,364,000             --             --
                                                                      -------------  -------------  -------------
Net income (loss)...................................................  $   1,911,000  $   5,138,000  $     (89,000)
                                                                      -------------  -------------  -------------
                                                                      -------------  -------------  -------------
</TABLE>
 
   The accompanying notes are an integral part of these financial statements.
 
                                       19
<PAGE>
                               EPIC RESORTS, LLC
 
             CONSOLIDATED STATEMENTS OF CHANGES IN MEMBER'S EQUITY
 
              FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996
 
<TABLE>
<S>                                            <C>
BALANCE, JANUARY 1, 1996.....................  $      8,763,000
  Contributions..............................           948,000
  Distributions..............................        (1,460,000)
  Net loss...................................           (89,000)
                                               ----------------
BALANCE, DECEMBER 31, 1996...................         8,162,000
  Contributions..............................           603,000
  Distributions..............................        (3,325,000)
  Net income.................................         5,138,000
                                               ----------------
BALANCE, DECEMBER 31, 1997...................        10,578,000
  Contributions..............................           263,000
  Distributions..............................          (766,000)
  Net income.................................         1,911,000
                                               ----------------
BALANCE, DECEMBER 31, 1998...................  $     11,986,000
                                               ----------------
                                               ----------------
</TABLE>
 
   The accompanying notes are an integral part of these financial statements.
 
                                       20
<PAGE>
                                EPIC RESORT, LLC
 
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
 
<TABLE>
<CAPTION>
                                                                           FOR THE YEAR ENDED DECEMBER 31,
                                                                    ---------------------------------------------
                                                                         1998             1997           1996
                                                                    ---------------  --------------  ------------
<S>                                                                 <C>              <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income (loss)...............................................  $     1,911,000  $    5,138,000  $    (89,000)
  Adjustments to reconcile net income (loss) to net cash (used in)
    provided by operating activities--
    Depreciation..................................................          652,000         771,000       799,000
    Amortization of financing costs...............................        1,557,000         173,000        75,000
    Provision for doubtful accounts...............................        1,116,000       1,392,000       492,000
    Gains on sales of receivables.................................      (10,232,000)             --            --
    Minority interest.............................................        1,190,000       1,676,000      (473,000)
    Changes in assets and liabilities--
      Mortgages receivable........................................       (5,529,000)    (17,543,000)     (710,000)
      Inventory...................................................      (64,174,000)      4,779,000      (709,000)
      Other assets................................................       (3,096,000)       (141,000)       14,000
      Accounts payable............................................          170,000         264,000       237,000
      Accrued expenses............................................        1,247,000          90,000       223,000
      Accrued interest payable....................................          655,000          13,000        58,000
      Deferred revenue............................................          268,000              --            --
      Advance deposits............................................           23,000         (86,000)       89,000
                                                                    ---------------  --------------  ------------
        Net cash (used in) provided by operating activities.......      (74,242,000)     (3,474,000)        6,000
                                                                    ---------------  --------------  ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of property and equipment..............................       (2,590,000)     (2,314,000)   (1,489,000)
  Investment in residual interests................................      (15,223,000)             --            --
                                                                    ---------------  --------------  ------------
        Net cash used in investing activities.....................      (17,813,000)     (2,314,000)   (1,489,000)
                                                                    ---------------  --------------  ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from notes payable.....................................       11,916,000      24,847,000     7,566,000
  Proceeds from bridge loan.......................................       55,414,000              --            --
  Proceeds from senior secured notes payable......................      130,000,000              --            --
  Payments on notes payable and bridge loan.......................     (109,600,000)    (15,965,000)   (5,472,000)
  Proceeds from sales of receivables..............................       40,022,000              --            --
  Interest escrows, net...........................................       (8,533,000)         86,000       (89,000)
  Payment of deferred financing costs.............................       (7,514,000)       (237,000)      (32,000)
  Purchase of minority interest...................................       (3,300,000)             --            --
  Contributions from sole member..................................          263,000         603,000       948,000
  Distributions to sole member....................................         (766,000)     (3,325,000)   (1,459,000)
                                                                    ---------------  --------------  ------------
        Net cash provided by financing activities.................      107,902,000       6,009,000     1,462,000
                                                                    ---------------  --------------  ------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS..............       15,847,000         221,000       (21,000)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD....................          248,000          27,000        48,000
                                                                    ---------------  --------------  ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD..........................  $    16,095,000  $      248,000  $     27,000
                                                                    ---------------  --------------  ------------
                                                                    ---------------  --------------  ------------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
  Interest paid...................................................  $     9,894,000  $    3,836,000  $  2,054,000
                                                                    ---------------  --------------  ------------
                                                                    ---------------  --------------  ------------
</TABLE>
 
   The accompanying notes are an integral part of these financial statements.
 
                                       21
<PAGE>
                               EPIC RESORTS, LLC
 
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
                        DECEMBER 31, 1998, 1997 AND 1996
 
1. NATURE OF BUSINESS AND BASIS OF PRESENTATION:
 
    Epic Resorts, LLC (a sole-member Delaware Limited Liability Company) and its
wholly-owned subsidiaries (the "Company") generate revenue from the sale and
financing of vacation ownership interests in its resorts. Customers acquire the
right to use a fully-furnished vacation residence, generally for a one-week
period each year, in perpetuity ("Vacation Ownership Interests"). The Company's
principal operations consist of (i) acquiring, developing and operating vacation
ownership resort locations, (ii) marketing and selling Vacation Ownership
Interests in its resorts, and (iii) providing customer financing to individual
purchasers of Vacation Ownership Interests at its resorts. The Company also
generates income from the transient rental of resort accommodations.
 
    The Company was formed in June 1998 to merge and succeed to the business of
Epic Resorts, Inc. (the "Predecessor") which had a sole stockholder who is the
sole member of the Company. The Predecessor business was responsible for
operating the wholly-owned resort at Lake Havasu City, Arizona known as London
Bridge Resort, Inc. (LBR), and a majority-owned resort at Daytona Beach, Florida
known as Dayton Beach Regency, Ltd. (DBR).
 
    The accompanying financial statements include the combined accounts of the
Company, London Bridge Resort, Inc. and Daytona Beach Regency, Ltd., which
together are doing business now as Epic Resorts, LLC. All of the entities
operated under the common control of the sole stockholder. Accordingly, all of
the net assets of the entities under common control have been recorded at their
historical cost and their results of operations have been included in the
combined results since their dates of acquisition. Minority interest reflects
the historical results of operations pertaining to the 44% partnership interest
in DBR for all periods up until the Company's acquisition of this minority
interest in June 1998.
 
    On June 30, 1998, the Company used $55.4 million of proceeds from a bridge
loan to purchase the following resorts: Scottsdale Links Resort (a 228-suite
complex in Scottsdale, Arizona), Palm Springs Marquis Villas (a 101-suite
complex in Palm Springs, California) and Westpark Resort (a 152-suite complex in
Las Vegas, Nevada). The total purchase price was allocated to the cost basis of
inventory at these resorts in accordance with the purchase method of accounting.
The Company also purchased the remaining 44% limited partnership interest in DBR
at a cost of $3.3 million which has been capitalized as a component of inventory
at this resort, net of the $2.4 million of minority interest acquired.
 
    On July 8, 1998, the Company issued 130,000 Units, representing $130 million
principal amount of 13% Senior Secured Redeemable Notes due 2005 (the "Notes")
and warrants to purchase membership interests or warrants to purchase common
stock in a private placement offering (the "Offering") pursuant to Rule 144A of
the Securities Act of 1933. Proceeds of the Offering were used by the Company
(i) to repay the $55.4 million bridge loan described above; (ii) to repay $23.8
million of certain indebtedness of the Company; (iii) to fund an escrow of the
first two interest payments under the Notes of $16.9 million; (iv) for working
capital and general corporate purposes and (v) to pay fees and expenses related
to the Offering and resort acquisitions. Proceeds of the Offering were also used
by the Company to acquire the Planter's Quarters Resort on the island of Hilton
Head in South Carolina on July 8, 1998 for a cash purchase of $3.8 million. The
resort contains 36 two and three bedroom suites and was accounted for by the
purchase method of accounting.
 
    On August 13, 1998, the Company filed a registration statement with the
Securities and Exchange Commission relating to an exchange offer for another
series of notes of the Company, containing substantially the same terms as the
Notes. These notes are now available to be publicly traded and are held by
institutional investors.
 
                                       22
<PAGE>
                               EPIC RESORTS, LLC
 
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 
                        DECEMBER 31, 1998, 1997 AND 1996
 
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
 
CASH AND CASH EQUIVALENTS
 
    Cash and cash equivalents consist of cash, money market and all highly
liquid investments purchased with an original maturity of three months or less.
Funds received from purchasers which are held during the statutory rescission
period, or until all conditions are met for the sales transaction to be
recognized and title conveyed, are maintained in escrow accounts and are
reflected as restricted cash.
 
MORTGAGES RECEIVABLE
 
    Mortgages receivable reflect the amounts due from Vacation Ownership
Interest purchasers who have accepted purchase money mortgage financing. The
obligations are evidenced by promissory notes and mortgages which are then
recorded in the state where the resort is located. The majority of these
installment contracts and mortgages receivable collateralize certain debt
obligations of the Company.
 
    Mortgages receivable are sold by the Company on a non-recourse basis in
connection with a loan participation facility with a financial institution (see
Note 3).
 
ALLOWANCE FOR DOUBTFUL ACCOUNTS
 
    The Company provides for estimated future losses related to uncollectible
receivables currently included in its installment contracts and mortgage
receivable portfolio. The provision is estimated based upon management's
estimate of losses which may result because of cancellation of the related
purchase money mortgage contract.
 
PROPERTY AND EQUIPMENT
 
    Property and equipment are stated at cost and depreciated using the
straight-line method over the estimated useful life of 5 to 7 years. Buildings
are amortized over their estimated useful life of 40 years.
 
DEFERRED FINANCING COSTS
 
    Financing and loan origination fees incurred in connection with obtaining
certain acquisition and development funding have been capitalized and are being
amortized over the term of the indebtedness.
 
INCOME TAXES
 
    The Company is a Delaware limited liability company, accordingly no federal
or state income taxes are payable by the Company, and none have been provided
for in the accompanying financial statements. The sole member is to include his
respective share of the Company's profits or losses in his tax return. The
Company's tax returns and the amount of allocable profits and losses are subject
to examination by federal and state taxing authorities. If such examinations
result in changes to Company profits or losses, the tax liability of the sole
member would be changed accordingly.
 
SALES RECOGNITION AND SELLING POLICIES
 
    The Vacation Ownership Interest purchaser has the right to rescind or cancel
their purchase contract within a set period of time following contract execution
(generally three to ten calendar days depending on the state in which the sale
is consummated), and is entitled to a full refund of their deposit. All funds
received by the Company are held in escrow, by an independent agent, until the
expiration of the rescission
 
                                       23
<PAGE>
                               EPIC RESORTS, LLC
 
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 
                        DECEMBER 31, 1998, 1997 AND 1996
 
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (CONTINUED)
period and title is conveyed to the purchaser. Sales, which are principally made
through installment contracts, are not recognized until the Company has received
at least 10 percent of the total purchase price, the statutory rescission period
has elapsed, and certificates of occupancy in the underlying units have been
issued. Prior to sales recognition, all payments received are accounted for as
advance deposits. Closing costs collected from the purchaser are used to offset
a portion of the closing costs incurred by the Company.
 
COST OF SALES AND INVENTORY
 
    Cost of sales is computed by allocating the total project acquisition and
conversion costs associated with the Vacation Ownership Interests over the
number of interests to be sold, based upon fifty-one weeks of availability per
individual unit. Inventory, including all development costs, contents and
improvements is stated at cost, which is not more than net realizable value.
Interests transferred back to the Company attributable to forfeiture, legal
foreclosure, or reconveyance of a deed-in-lieu of legal foreclosure, are
returned to inventory at the original amount expensed as the cost of sale.
Marketing, advertising, commissions, and other selling costs are expensed as
incurred.
 
COMPREHENSIVE INCOME
 
    In June 1997, the Financial Accounting Standards Board issued SFAS No. 130,
"Reporting Comprehensive Income". The standard establishes additional disclosure
for the elements of comprehensive income and a total comprehensive income
calculation. Net income as reported by the Company reflects total comprehensive
income for each of the three years in the period ended December 31, 1998.
 
USE OF ESTIMATES
 
    The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
 
RECLASSIFICATIONS
 
    Certain prior year amounts have been reclassified to conform with the
current year presentation.
 
3. MORTGAGES RECEIVABLE:
 
    The Company provides financing to its customers, which is collateralized by
such purchaser's Vacation Ownership Interest. The Company offers certain
customers, who make deposits of 33%, one-year financing on a non-interest
bearing basis. The purchase money mortgages generally mature over terms which
approximate 84 months, with fixed interest rates ranging from 13.9 percent to
16.9 percent, per annum. The mortgages may be prepaid at any time, without
penalty. The weighted average rate of interest on outstanding mortgages
receivable is 15.5%, 14.9% and 14.4% for the years ended December 31, 1998, 1997
and 1996, respectively.
 
                                       24
<PAGE>
                               EPIC RESORTS, LLC
 
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 
                        DECEMBER 31, 1998, 1997 AND 1996
 
3. MORTGAGES RECEIVABLE: (CONTINUED)
    The following schedule reflects the scheduled principal maturities of
mortgages receivable:
 
<TABLE>
<S>                                                 <C>
1999..............................................  $    1,219,000
2000..............................................       1,367,000
2001..............................................       1,517,000
2002..............................................       1,727,000
2003..............................................       1,954,000
Thereafter........................................       4,978,000
                                                    --------------
Total principal maturities of mortgages
  receivable......................................      12,762,000
Less allowance for doubtful accounts..............        (991,000)
                                                    --------------
Net principal maturities of mortgages
  receivable......................................  $   11,771,000
                                                    --------------
                                                    --------------
</TABLE>
 
    The activity in the mortgages receivable allowance for doubtful accounts is
as follows:
 
<TABLE>
<CAPTION>
                                                                    DECEMBER 31,
                                                      ----------------------------------------
                                                          1998          1997          1996
                                                      ------------  -------------  -----------
<S>                                                   <C>           <C>            <C>
Balance, beginning of period........................  $    750,000  $     736,000  $   692,000
  Provision for doubtful accounts...................     1,116,000      1,392,000      492,000
  Charge-offs.......................................      (875,000)    (1,378,000)    (448,000)
                                                      ------------  -------------  -----------
Balance, end of period..............................  $    991,000  $     750,000  $   736,000
                                                      ------------  -------------  -----------
                                                      ------------  -------------  -----------
</TABLE>
 
    During 1998, the Company sold $45,479,000 of mortgages receivables as part
of its $75 million Vacation Ownership Loan Participation Facility ("Receivables
Facility"). Under this Receivables Facility, the Company sells its Vacation
Ownership Interest Receivables on a non-recourse basis to Epic Master Funding
Corporation ("Epic Funding"), a wholly-owned subsidiary which is a qualifying
special purpose entity as defined in SFAS No. 125, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities". The
commitment provides for advance rates of 88% of the lesser of (i) unpaid
principal balance of the receivables sold or (ii) the market value of such
receivables as determined by the financial institution. The Receivables Facility
contains a customary provision requiring the substitution of collateral in an
equal amount if receivables become 60 days past due.
 
    The Company accounts for the transfers of receivables to Epic Funding as
sales in accordance with SFAS No. 125. The Company recognized gains on the sales
of mortgages receivable of $10,232,000 as a result of $45,479,000 of sales and
has an investment in residual interests associated with these mortgages
receivable of $15,223,000. The retained interests were valued by the Company
assuming a 10% discount rate for estimated defaults and prepayments and a 6.5%
annual interest rate on the monthly balance of the financing. The Company
accounts for this investment as a held-to-maturity security in accordance with
SFAS No. 115, "Accounting for Certain Investments and Debt Securities".
 
                                       25
<PAGE>
                               EPIC RESORTS, LLC
 
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 
                        DECEMBER 31, 1998, 1997 AND 1996
 
4. INVENTORY:
 
    Inventory and accumulated cost of sales consist of the following as of
December 31, 1998 and 1997:
 
<TABLE>
<CAPTION>
                                                                    1998            1997
                                                               --------------  --------------
<S>                                                            <C>             <C>
Acquisition and development costs............................  $  105,964,000  $   32,972,000
Less: accumulated cost of sales..............................     (30,244,000)    (22,416,000)
Less: resort property valuation allowance....................      (2,678,000)     (2,593,000)
                                                               --------------  --------------
                                                               $   73,042,000  $    7,963,000
                                                               --------------  --------------
                                                               --------------  --------------
</TABLE>
 
5. PROPERTY AND EQUIPMENT:
 
    Property and equipment consist of the following as of:
 
<TABLE>
<CAPTION>
                                                                          DECEMBER 31,
                                                                   ---------------------------
                                                                       1998           1997
                                                                   -------------  ------------
<S>                                                                <C>            <C>
Land.............................................................  $   2,913,000  $  2,913,000
Building and improvements........................................     11,177,000     8,806,000
Furniture, fixtures and equipment................................      2,122,000     1,805,000
                                                                   -------------  ------------
                                                                      16,212,000    13,524,000
Less: Accumulated depreciation...................................      4,303,000     3,553,000
                                                                   -------------  ------------
                                                                   $  11,909,000  $  9,971,000
                                                                   -------------  ------------
                                                                   -------------  ------------
</TABLE>
 
6. NOTES PAYABLE:
 
    On July 8, 1998, the Company issued 130,000 units, representing $130,000,000
principal amount of Senior Secured Redeemable Notes (the "Notes"). The Notes
bear interest at the rate of 13% per annum, payable semiannually on June 15 and
December 15 of each year and are scheduled to mature on June 15, 2005. The notes
were recorded at their fair value less the initial value of the warrants of
$2,757,000 and will be accreted to their redeemable value through maturity. The
Company maintains $8,450,000 at all times in escrow to cover the next required
interest payment.
 
    All of the Company's operating subsidiaries (the Subsidiary Guarantors) have
fully and unconditionally guaranteed the Notes. Epic Resorts, LLC's activities
are limited to owning and operating the Company's six resort properties. In
addition, their activities include the owning and collecting of the Company's
investment in the residual interests. Accordingly, the combined financial
information of the Subsidiary Guarantors is equivalent to the consolidated
financial statements of the Company, except for the Company's investment in the
residual interests of $15,223,000 as described in Note 3. The holders of the
Notes would have a direct claim to the residual interest in the event of a
default, as defined, under the Notes. The separate financial statements and
other disclosures concerning the Subsidiary Guarantors are not presented because
management has determined that they are not material to investors.
 
    Concurrent with the issuance of the Notes, the Company issued 130,000 of
warrants with a par value of $.01 per warrant. These warrants have been valued
using the Black-Scholes pricing model and are being amortized as a component of
additional interest expense over the seven year term of the Notes. The
amortization increases the redemption value of the notes through maturity.
 
                                       26
<PAGE>
                               EPIC RESORTS, LLC
 
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 
                        DECEMBER 31, 1998, 1997 AND 1996
 
6. NOTES PAYABLE: (CONTINUED)
    In connection with the Offering, the Company incurred $2,055,000 of
prepayment penalties. The Company wrote off $667,000 of unamortized deferred
financing costs related to the extinguished debt. During the fourth quarter of
1998, the Company used the proceeds from the initial funding of the Receivables
to pay off $20.0 million of outstanding notes payable. The Company incurred
$2,029,000 of prepayment penalties and wrote off $613,000 of unamortized
deferred financing costs. These expenses have been reflected as an extraordinary
losses in the accompanying statement of operations for the year ended December
31, 1998.
 
    Notes payable at December 31, 1998 and 1997 consist of the following:
 
<TABLE>
<CAPTION>
                                                                           DECEMBER 31,
                                                                     -------------------------
                                                                        1998         1997
                                                                     ----------  -------------
<S>                                                                  <C>         <C>
Revolving lines of credit, with interest payable monthly at rates
  of 11.0% to 11.22%...............................................  $       --  $  30,240,000
 
Construction loans payable with interest payable at rates of 11.25%
  to 11.72%........................................................          --      6,199,000
 
Acquisition loan payable with interest payable at LIBOR plus 6%
  (11.72% at December 31, 1997)....................................          --      2,043,000
 
Equipment loans payable with interest payable at fixed rates of
  12.75% to 13.05%, payable in 48 equal monthly installments of
  principal and interest, collateralized by furniture and
  equipment, due 1999 to 2001......................................     621,000        496,000
 
Other note payable.................................................          --      3,913,000
                                                                     ----------  -------------
 
Total notes payable................................................  $  621,000  $  42,891,000
                                                                     ----------  -------------
                                                                     ----------  -------------
</TABLE>
 
7. RELATED PARTY TRANSACTIONS:
 
    At December 31, 1998, the Company has accrued $829,000 as a receivable from
various homeowners' associations at its resorts. The Company generally accrues
receivables from homeowners' associations for management fees and certain other
expenses paid on behalf of the homeowners' associations. This receivable is
included in other assets in the accompanying consolidated balance sheet. At
December 31, 1997, the Company had accrued $56,000 as a payable to the
homeowners' associations at its resorts. Payables to the homeowners'
associations consist primarily of maintenance fees for units owned by the
Company. This payable is included in accrued expenses in the accompanying
consolidated balance sheet.
 
    In 1998, the Company paid $1,601,000 of construction and inventory-related
items to certain companies which are affiliated with a manager and member of the
Company's Advisory Board. The Company believes that these transactions have been
made on substantially the same terms as those prevailing in the current
marketplace.
 
    In October 1990, the Company obtained a nonrecourse line of credit not to
exceed $3,413,000 from an affiliate of the sole member, all of which remained
outstanding as of December 31, 1997. The loan was collateralized by an
assignment of a second mortgage on the Company's property. This loan is
subordinate to the claims of the Company's construction and equipment loans and
was not payable until these notes
 
                                       27
<PAGE>
                               EPIC RESORTS, LLC
 
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 
                        DECEMBER 31, 1998, 1997 AND 1996
 
7. RELATED PARTY TRANSACTIONS: (CONTINUED)
were paid in full. Interest accrued at a rate of 8.5% per annum up to a maximum
amount of $500,000. Upon reaching $500,000 in 1995, the note became noninterest
bearing and the accrued liability was capitalized into the loan's principal.
During 1998, 1997 and 1996, no interest was accrued under the terms of this
note. This note, together with a fee paid to a related party of $1,087,000, was
paid in full with the proceeds of the Offering.
 
    Through June 30, 1998, in the normal course of operations, an affiliate of
the sole member provided the Company with administrative services including
payroll and insurance processing.
 
8. COMMITMENTS AND CONTINGENCIES:
 
    The Company leases commercial real estate to various retail operators, for
the operation of a shopping mall, under various lease agreements that expire
through September 2002. Future minimum rental income expected to be recognized
from noncancelable operating leases on a straight-line basis as of December 31,
1998, is as follows:
 
<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31:
----------------------------------------------------------------------------------
<S>                                                                                 <C>
1999..............................................................................  $  435,000
2000..............................................................................     282,000
2001..............................................................................     134,000
2002..............................................................................      23,000
                                                                                    ----------
Total future minimum rentals......................................................  $  874,000
                                                                                    ----------
                                                                                    ----------
</TABLE>
 
9. FAIR VALUE OF FINANCIAL INSTRUMENTS:
 
    SFAS No. 107, "Disclosure about Fair Value of Financial Instruments",
requires that the Company disclose estimated fair values for its financial
instruments. The following methods and assumptions were used by the Company in
estimating its fair value disclosures for financial instruments:
 
    CASH AND CASH EQUIVALENTS:  The carrying amount reported in the balance
sheet for cash and cash equivalents approximates their fair value because of the
short-term maturity of these instruments.
 
    MORTGAGES RECEIVABLE:  The carrying amount reported in the balance sheet for
mortgages receivable approximates its fair value because the weighted average
interest rate on the portfolio of mortgages receivable approximates current
interest rates to be received on similar current mortgages receivable.
 
    SENIOR SECURED NOTES PAYABLE AND NOTES PAYABLE:  The carrying amounts
reported in the balance sheet for notes payable approximates its fair value
because the interest rates on these instruments approximate current interest
rates charged on similar current borrowings.
 
10. SEGMENT AND GEOGRAPHIC INFORMATION:
 
    The Company operates in one industry segment, which includes the
development, acquisition, marketing, selling, financing and management of
vacation ownership resorts. The Company does not operate outside of the United
States. The Company's customers are not concentrated in any specific geographic
region and no single customer accounts for a significant amount of the Company's
sales.
 
                                       28
<PAGE>
                               EPIC RESORTS, LLC
 
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 
                        DECEMBER 31, 1998, 1997 AND 1996
 
11. SUMMARY OF QUARTERLY RESULTS (UNAUDITED):
 
    The following presents a summary of the unaudited quarterly financial
information for the years ended December 31, 1998 and 1997:
 
<TABLE>
<CAPTION>
                                                         FOR THE YEAR ENDED DECEMBER 31, 1998
                                      --------------------------------------------------------------------------
                                           1ST            2ND            3RD             4TH           TOTAL
                                      -------------  -------------  --------------  -------------  -------------
<S>                                   <C>            <C>            <C>             <C>            <C>
Revenues............................  $  10,109,000  $  12,484,000  $   14,333,000  $  23,348,000  $  60,274,000
Total expenses (1)..................      8,194,000      9,623,000      15,174,000     18,818,000     51,809,000
                                      -------------  -------------  --------------  -------------  -------------
Income (loss) before minority
  interest and extraordinary loss...      1,915,000      2,861,000        (841,000)     4,530,000      8,465,000
Minority Interest (2)...............        543,000        647,000              --             --      1,190,000
Extraordinary loss (3)..............             --             --       2,722,000      2,642,000      5,364,000
                                      -------------  -------------  --------------  -------------  -------------
Net income (loss)...................  $   1,372,000  $   2,214,000  $   (3,563,000) $   1,888,000  $   1,911,000
                                      -------------  -------------  --------------  -------------  -------------
                                      -------------  -------------  --------------  -------------  -------------
</TABLE>
 
<TABLE>
<CAPTION>
                                                         FOR THE YEAR ENDED DECEMBER 31, 1997
                                      --------------------------------------------------------------------------
                                           1ST            2ND            3RD             4TH           TOTAL
                                      -------------  -------------  --------------  -------------  -------------
<S>                                   <C>            <C>            <C>             <C>            <C>
Revenues............................  $   8,588,000  $  10,375,000  $   11,957,000  $   9,371,000  $  40,291,000
Total expenses......................      7,313,000      7,981,000      10,156,000      8,027,000     33,477,000
                                      -------------  -------------  --------------  -------------  -------------
Income before minority interest.....      1,275,000      2,394,000       1,801,000      1,344,000      6,814,000
Minority Interest...................        446,000        555,000         206,000        469,000      1,676,000
                                      -------------  -------------  --------------  -------------  -------------
Net income..........................  $     829,000  $   1,839,000  $    1,595,000  $     875,000  $   5,138,000
                                      -------------  -------------  --------------  -------------  -------------
                                      -------------  -------------  --------------  -------------  -------------
</TABLE>
 
------------------------
 
(1) Expenses during the 3rd quarter of 1998 include start-up and staffing costs
    incurred prior to the commencement of sales operations at the newly acquired
    resorts.
 
(2) On June 30, 1998, the Company completed the buyout of minority interest upon
    the acquisition of all of the minority partner's interests in Daytona Beach
    Regency, Ltd.
 
(3) Represents the extraordinary losses on the early repayments of existing
    company indebtedness, including prepayment penalties and write-off of
    unamortized deferred financing costs (see Note 6 to the consolidated
    financial statements).
 
12. SUBSEQUENT EVENT:
 
    Subsequent to year end, the Company began selling membership interests into
Epic Vacation Club (the "Club"), a Delaware nonprofit mutual benefit corporation
formed in 1998, at all of its resorts. The Club was formed for the specific
purpose of owning and managing the real property conveyed to it by the Company
and its resort subsidiaries. The Club provides purchasers significant
flexibility in their vacation planning, a wider variety of vacation options and
easier access to the Company's network of resorts. The Club sells points, which
entitle the customer to reserve units at any of the Company's six resorts and in
increments as short as one day. The number of points required to stay one day at
one of the Company's resorts varies depending upon the particular resort, the
size of the unit, the season and the day of the week.
 
                                       29
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
  FINANCIAL DISCLOSURE
 
    Not Applicable.
 
                                    PART III
 
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
 
MANAGING MEMBER
 
    The Company's Managing Member is Epic Membership Corp., a Delaware
corporation wholly owned by Mr. Flatley. Pursuant to the Company's Operating
Agreement, the Managing Member has the sole power to conduct, manage, control
and make all decisions affecting the conduct of the business, assets and affairs
of the Company. The Company also maintains a Board of Managers which acts in an
advisory capacity to the Managing Member and performs such other functions as
delegated to it by the Managing Member.
 
EXECUTIVE OFFICERS
 
    The following table sets forth certain information concerning the executive
officers of the Company. Officers hold office until their successors are elected
and qualified.
 
<TABLE>
<CAPTION>
NAME                               AGE                        POSITION
---------------------------------  ---  -----------------------------------------------------
<S>                                <C>  <C>
 
Thomas F. Flatley................  47   President and Chief Executive Officer
 
Scott J. Egelkamp................  40   Vice President and Chief Financial Officer
</TABLE>
 
    THOMAS F. FLATLEY has been President, Chief Executive Officer and a Director
of predecessors of the Company since 1991. Mr. Flatley has also served as the
President and a Director of American Financial Mortgage Corporation, a national
mortgage banking company, since 1988. From 1974 to 1982, Mr. Flatley practiced
as a Certified Public Accountant with Price Waterhouse, LLP. Mr. Flatley was
recently awarded the 1998 ARDA Community Service Award.
 
    SCOTT J. EGELKAMP has been Vice President and Chief Financial Officer of
predecessors of the Company since 1992. Mr. Egelkamp has also served, since
1988, as Vice President and Chief Financial Officer of American Financial
Mortgage Corporation. Mr. Egelkamp has over 15 years of experience as a
financial manager in service and manufacturing environments.
 
ITEM 11. EXECUTIVE COMPENSATION
 
    SUMMARY COMPENSATION TABLE.  The following table sets forth, for the fiscal
years 1997 and 1998, certain information about the compensation paid to the
chief executive officer and the other executive officers of the Company.
 
<TABLE>
<CAPTION>
                                                                      ANNUAL COMPENSATION
                                                                     ----------------------
                                                                       FISCAL                             ALL OTHER
NAME AND PRINCIPAL POSITION                                             YEAR       SALARY      BONUS    COMPENSATION
-------------------------------------------------------------------  -----------  ---------  ---------  -------------
<S>                                                                  <C>          <C>        <C>        <C>
Thomas F. Flatley..................................................        1998   $ 280,000         --            --
President and Chief Executive                                              1997      (a)            --            --
  Officer
Scott J. Egelkamp..................................................        1998   $ 125,000         --            --
Vice President and Chief Financial                                         1997   $ 125,000         --            --
  Officer
</TABLE>
 
------------------------
 
(a) Mr. Flatley did not receive a salary in 1997.
 
                                       30
<PAGE>
    EMPLOYMENT AGREEMENTS.  Each of Thomas F. Flatley and Scott J. Egelkamp have
entered into employment agreements with the Company. Each agreement provides for
an employment term of three years, commencing May 20, 1998 (the "Employment
Period") and an annual base salary of $280,000 and $125,000, for Mr. Flatley and
Mr. Egelkamp, respectively. The annual base salary is subject to increase at the
discretion of the Chief Executive Officer of the Company. Each of Mr. Flatley
and Mr. Egelkamp's employment agreements provide that if he is terminated for
any reason other than violation of the agreement, he is entitled to 120 days
notice prior to termination, to payment of all accrued and unpaid salary and
benefits through the date of termination, and a lump sum payment equal to one
year of his salary. In addition, if the employment agreement of either officer
is terminated without cause upon the occurrence of a merger, consolidation or
other business combination in which the Company is not the surviving entity,
such officer will be entitled to a lump sum payment equal to two years of his
salary.
 
    Pursuant to the employment agreements, each of the Executive Officers has
agreed:
 
    - not to compete with the Company in the vacation ownership business during
      the Employment Period and for a period of six months after the termination
      of such period,
 
    - to keep all proprietary information of the Company confidential for a
      period of two years following the termination of his employment with the
      Company, and
 
    - that he will not solicit any employee to leave the employ of the Company
      during the Employment Period or for two years following the termination of
      his employment with the Company.
 
    LIFE INSURANCE POLICY.  The Company purchased an annual renewable term life
insurance policy on Mr. Flatley from CNA Life Insurance Company. This policy has
a face value of $15 million. The Company is the sole beneficiary of this policy.
 
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 
    99% of the 1,118,000 outstanding membership interests in the Company are
held by Mr. Flatley, its President and Chief Executive Officer. The remaining 1%
of outstanding membership interests are owned by the Managing Member of the
Company, Epic Membership Corp., which is wholly owned by Mr. Flatley. In
connection with the offering of the Notes, the Company issued warrants
exercisable in the aggregate for approximately 14% of the total outstanding
membership interests on a fully diluted basis after giving effect to the
offering of the Notes.
 
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
    In October 1990, London Bridge Resort obtained a line of credit not to
exceed $3,412,545. This loan was collateralized by an assignment of a second
mortgage on London Bridge Resort's facilities and properties. The loan was
subordinate to the claims of London Bridge Resort's construction and equipment
loans and would become payable when those construction and equipment loans were
paid in full. American Realty Group, Inc., a Pennsylvania corporation wholly
owned by Mr. Flatley ("American Realty"), was the holder of a promissory note
evidencing such loan (the "American Realty Debt"). Interest on the promissory
note accrued at a rate of 8.5% per annum up to a maximum amount of $500,000. In
1995, interest accrued to $500,000 and the promissory note became non-interest
bearing. As of December 31, 1997, the balance of the promissory note was
$3,912,545, and was repaid in July 1998 out of the proceeds of the offering of
the Notes. Pursuant to an Agreement to Subordinate dated October 30, 1995,
between American Realty and Queen's Bay Joint Venture (the predecessor to London
Bridge Resort, LLC.), American Realty was entitled to receive a fee of
$1,087,455 upon the repayment of certain financing of Queen's Bay Joint Venture
as consideration for American Realty's agreement to subordinate the American
Realty Debt to such financing. Such fee was paid in July 1998 in connection with
the offering of the Notes.
 
                                       31
<PAGE>
                                    PART IV
 
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
 
(a) FINANCIAL STATEMENTS
 
    Exhibit 27--Financial Data Schedule.
 
(b) REPORTS. No reports on Form 8-K have been filed during the last quarter of
    the fiscal year ended December 31, 1998.
 
(c) EXHIBITS
 
<TABLE>
<CAPTION>
  EXHIBIT
  NUMBER     DESCRIPTION OF DOCUMENT
-----------  ----------------------------------------------------------------------------------------------
<C>          <S>
       3.1   Certificate of Formation of Epic Resorts, LLC. (incorporated by reference to Exhibit 3.1 to
             the Company's registration statement on Form S-4, File No. 333-61433)
 
       3.2   Operating Agreement of Epic Resorts, LLC. (incorporated by reference to Exhibit 3.2 to the
             Company's registration statement on Form S-4, File No. 333-61433)
 
       3.3   By-Laws of Epic Resorts, LLC. (incorporated by reference to Exhibit 3.3 to the Company's
             registration statement on Form S-4, File No. 333-61433)
 
       3.4   Certificate of Incorporation of Epic Vacation Club.
 
       3.5   By-Laws of Epic Vacation Club (to be filed on a Current Report on Form 8-K)
 
       4.1   Indenture, dated July 8, 1998 between Epic Resorts, LLC, Epic Capital Corp., the Subsidiary
             Guarantors signatory thereto and United States Trust Company of New York, as Trustee relating
             to the 13% Senior Secured Redeemable Notes due 2005 (the form of which is included in such
             indenture). (incorporated by reference to Exhibit 4.1 to the Company's registration statement
             on Form S-4, File No. 333-61433)
 
       4.2   Form of Global Exchange Note (included in Exhibit 4.1). (incorporated by reference to Exhibit
             4.2 to the Company's registration statement on Form S-4, File No. 333-61433)
 
       4.4   First Supplemental Indenture, dated January 7, 1999 between Epic Resorts, LLC, Epic Capital
             Corp., the Subsidiary Guarantors signatory thereto, Epic Marketing, LLC, Epic
             Resorts--Vacation Showplace LLC, Epic Resorts Management, LLC and United States Trust Company
             of New York as trustee.
 
       4.5   Second Supplemental Indenture, dated February 3, 1999 between Epic Resorts, LLC, Epic Capital
             Corp., the Subsidiary Guarantors signatory thereto and United States Trust Company of New
             York, as trustee.
 
      10.1*  Employment Agreement between Epic Resorts, Inc. and Thomas F. Flatley, dated May 20, 1998.
             (incorporated by reference to Exhibit 10.1 to the Company's registration statement on Form
             S-4, File No. 333-61433)
 
      10.2*  Employment Agreement between Epic Resorts, Inc. and Scott J. Egelkamp, dated May 20, 1998.
             (incorporated by reference to Exhibit 10.2 to the Company's registration statement on Form
             S-4, File No. 333-61433)
</TABLE>
 
                                       32
<PAGE>
<TABLE>
<CAPTION>
  EXHIBIT
  NUMBER     DESCRIPTION OF DOCUMENT
-----------  ----------------------------------------------------------------------------------------------
<C>          <S>
      10.3   Escrow and Disbursement Agreement, dated July 8, 1998 between United States Trust Company of
             New York, as Trustee under the Indenture and as Escrow Agent, Epic Resorts, LLC and Epic
             Capital Corp. (incorporated by reference to Exhibit 10.3 to the Company's registration
             statement on Form S-4, File No. 333-61433)
 
      10.4   Security Agreement, dated July 8, 1998 made by the Grantors named therein in favor of United
             States Trust Company of New York, as trustee under the Indenture, Collateral Agent and
             Depository for the benefit of the Noteholders of the 13% Senior Secured Notes due 2005 issued
             by Epic Resorts, LLC and Epic Capital Corp. (incorporated by reference to Exhibit 10.4 to the
             Company's registration statement on Form S-4, File No. 333-61433)
 
      10.5   Registration Rights and Members' Agreement, dated July 8, 1998 between Epic Resorts, LLC, Epic
             Membership Corp., Members of Epic Resorts LLC, Epic Capital Corp., Epic Warrant Co. and
             NatWest Capital Markets Limited, as Initial Purchaser. (incorporated by reference to Exhibit
             10.5 to the Company's registration statement on Form S-4, File No. 333-61433)
 
      10.6   Warrant Agreement, dated July 8, 1998 between Epic Warrant Co., as Issuer and United States
             Trust Company of New York, as Warrant Agent. (incorporated by reference to Exhibit 10.6 to the
             Company's registration statement on Form S-4, File No. 333-61433)
 
      10.7   Warrant Agreement, dated July 8, 1998 between Epic Resorts, LLC, as Issuer and United States
             Trust Company of New York, as Warrant Agent. (incorporated by reference to Exhibit 10.7 to the
             Company's registration statement on Form S-4, File No. 333-61433)
 
      10.8   Form of Epic Warrant Co. Warrant Certificate (included in and incorporated by reference to
             Exhibit 10.6 to the Company's registration statement on Form S-4, File No. 333-61433)
 
      10.9   Form of Epic Resorts, LLC Warrant Certificate (included in and incorporated by reference to
             Exhibit 10.7 to the Company's registration statement on Form S-4, File No. 333-61433)
 
      10.10  Mortgage and Security Agreement, granted July 8, 1998 by Epic Resorts--Hilton Head, LLC, as
             mortgagor to United States Trust Company of New York, as trustee under the Indenture and
             mortgagee. (incorporated by reference to Exhibit 10.10 to the Company's registration statement
             on Form S-4, File No. 333-61433)
 
      10.11  Deed of Trust, granted July 8, 1998 by Epic Resorts--Westpark Resort, LLC, as trustor to
             United Title of Nevada, as trustee for the benefit of United States Trust Company of New York,
             as trustee under the Indenture. (incorporated by reference to Exhibit 10.11 to the Company's
             registration statement on Form S-4, File No. 333-61433)
 
      10.12  Form of Leasehold Deed of Trust, Assignment of Leases and Rents Security Agreement and Fixture
             Filing, granted July  , 1998 by Epic Resorts--Palm Springs Marquis Villas, LLC, as trustor to
             Barbara J. Goodman, Esq., as trustee for the benefit of United States Trust Company of New
             York, as trustee under the Indenture. (incorporated by reference to Exhibit 10.12 to the
             Company's registration statement on Form S-4, File No. 333-61433)
</TABLE>
 
                                       33
<PAGE>
<TABLE>
<CAPTION>
  EXHIBIT
  NUMBER     DESCRIPTION OF DOCUMENT
-----------  ----------------------------------------------------------------------------------------------
<C>          <S>
      10.13  Mortgage, granted July 8, 1998 by Daytona Beach Regency, Ltd., as mortgagor to United States
             Trust Company of New York, as trustee under the Indenture and mortgagee. (incorporated by
             reference to Exhibit 10.13 to the Company's registration statement on Form S-4, File No.
             333-61433)
 
      10.14  Deed of Trust, granted July 8, 1998 by Epic Resorts--Scottsdale Links Resort, LLC, as trustor
             to Jones Osborn, II, Esq., as trustee for the benefit of United States Trust Company of New
             York, as trustee under the Indenture. (incorporated by reference to Exhibit 10.14 to the
             Company's registration statement on Form S-4, File No. 333-61433)
 
      10.15  Receivables Loan and Security Agreement, dated October 11, 1996 between London Bridge Resort,
             Inc. and Finova Capital Corporation. (incorporated by reference to Exhibit 10.15 to the
             Company's registration statement on Form S-4, File No. 333-61433)
 
      10.16  Trust Indenture, dated September 28, 1998 between Epic Master Funding Corporation, Epic
             Resorts, LLC as administrator and Marine Midland Bank, as trustee. (incorporated by reference
             to Exhibit 10.16 to the Company's registration statement on Form S-4, File No. 333-61433)
 
      10.17  Credit Agreement, dated September 28, 1998 between Epic Master Funding Corporation, Epic
             Resorts, LLC and Prudential Securities Credit Corporation. (incorporated by reference to
             Exhibit 10.17 to the Company's registration statement on Form S-4, File No. 333-61433)
 
      10.18  Form of Security Agreement for vacation club property, between United States Trust Company of
             New York, as trustee under the Indenture and the resort subsidiary transferring vacation
             ownership units to Epic Vacation Club.
 
      21     Subsidiaries of Epic Resorts, LLC.
 
      27     Financial Data Schedule.
</TABLE>
 
(d) FINANCIAL STATEMENT SCHEDULES
 
Schedules are omitted because they are not applicable or are not required or
because the information is reported in the consolidated financial statements or
notes thereto.
 
    SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO
SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES
PURSUANT TO SECTION 12 OF THE ACT.
 
   NO ANNUAL REPORT OR PROXY STATEMENT COVERING THE COMPANY'S LAST FISCAL YEAR
HAS BEEN OR WILL BE CIRCULATED TO SECURITY HOLDERS.
 
                                       34
<PAGE>
                                   SIGNATURE
 
    Pursuant to the requirements of Section 13 of the Securities Exchange Act of
1934, the registrant has duly caused this annual report on Form 10-K to be
signed on its behalf by the undersigned thereunto duly authorized.
 
                                EPIC RESORTS, LLC
 
                                By:            /s/ SCOTT J. EGELKAMP
                                     -----------------------------------------
                                                 Scott J. Egelkamp
                                     VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
                                            (DULY AUTHORIZED OFFICER AND
                                            PRINCIPAL FINANCIAL OFFICER)
Date: March 31, 1999
 
    Pursuant to the requirements of the Securities Exchange Act of 1934, this
annual report on Form 10-K has been signed below by the following persons on
behalf of the Registrant and in the capacities and on the dates indicated.
 
<TABLE>
<CAPTION>
          SIGNATURE                       TITLE                    DATE
------------------------------  --------------------------  -------------------
 
<C>                             <S>                         <C>
                                President and Chief
    /s/ THOMAS F. FLATLEY         Executive Officer
------------------------------    (Principal Executive        March 31, 1999
      Thomas F. Flatley           Officer)
 
                                Vice President and Chief
    /s/ SCOTT J. EGELKAMP         Financial Officer
------------------------------    (Principal Financial and    March 31, 1999
      Scott J. Egelkamp           Accounting Officer)
 
                                Managing Member               March 31, 1999
    /s/ THOMAS F. FLATLEY
------------------------------
    Epic Membership Corp.
    By: Thomas F. Flatley,
          President
</TABLE>
 
                                       35