NASCAR Charter Announcement

NASCAR Charter Announcement
February 9, 2016

February 9, 2016

An interview with:    

BRIAN FRANCE

MIKE HELTON

STEVE NEWMARK

STEVE O'DONNELL

TOMMY BALDWIN

BRENT DEWAR

ROB KAUFFMAN

RICHARD PETTY

DAVID HIGDON:  Good afternoon, everyone.  Welcome to Charlotte, North Carolina, for a truly important day in NASCAR history.  We welcome those fans watching on NASCAR.com live or listening on SiriusXM NASCAR radio.

            Even without our news today, of course this week has always been one filled with great anticipation for the industry because as we know it's race week, so we're excited about that.

            This one holds increased significance as we look forward to Saturday night's Sprint Unlimited live on FOX.  It's also NASCAR's opening weekend at Daytona International Speedway with the massive Daytona Rising program as its backdrop.

            Congratulations to Lesa France Kennedy, John Saunders, Joie Chitwood and everyone at ISC on the creation of the world's first motorsports stadium.  It's a phenomenal stadium that several of you I know enjoyed at the Rolex 24 recently.

            Throughout this room we welcome a group of executives whose tireless efforts will provide our sport with a foundation that promotes both stability and prosperity for many years to come.

            On stage we welcome seven key members of that collective group:  Vice chairman of NASCAR, Mike Helton; president of Roush Fenway Racing, Steve Newmark; owner of Tommy Baldwin Racing, Tommy Baldwin; NASCAR executive vice president and chief racing development officer, Steve O'Donnell; NASCAR chief operating officer Brent Dewar; co-owner of Chip Ganassi Racing, Rob Kauffman; and the King, owner of Richard Petty Motorsports, Richard Petty.

            Now to open with today's news, please welcome NASCAR chairman and CEO Brian France.

            BRIAN FRANCE:  Good afternoon.  Earlier today I addressed our team owners and congratulated them on being a part of an historic day at NASCAR.  I say that because of the structural changes that you'll hear more about later regarding our team owner model.

            Before I walk you through just a little bit of that, let me point out a couple people.  Our side tirelessly worked.  This is a very complicated agreement, to sort out, with 60 years of history doing business in a certain way.  To restructure things in the manner that we did was a very tall order to accomplish.

            I will tell you that Rob Kauffman, Steve Newmark and many others had a very steady hand in trying to figure out, as I always start our discussions out:  What is possible for the future.

            Where we ended up is a very good place because we believe we made the team owner model more reliable, more stable, more open, more open to new investors, more capital to come into the sport.  We've done that in a way that preserves a lot of the traditions that are important to NASCAR:  the competition level, et cetera, how we qualify for events, the fact that if you have the talent and the aspiration to join NASCAR, you can do that in the new model as you could in the old.

            But in the end we have a model that fits the 21st century and I think will serve us well into the future.  If it works properly, and we're very certain that it will, it's going to do some things.  It's going to create more opportunities for, as I said, new owners to come into the sport.  That's number one.  Number two, it's going to have the ability to field better, more competitive race teams.  That's what our fans want.  They want to see their favorite driver have an opportunity that's robust and competitive and all the things that makes a great race team succeed.

            So all the things that we did in this new agreement all point to those important attributes of what we think makes up this new arrangement.  So we're excited.

            We're also excited for another reason.  It's an important reason.  We always have said, because we mean it, that our owners and their success and their viability is very important to us.  That remains true yesterday; it remains true today.

            But these agreements and this new course that we're on today gives us a chance to really back that up.  We get to align our interests in a way we never thought we could.  I'm excited about that.  We're going to be partners in a different way going forward.  I couldn't be more thrilled.

            There were a lot of people who thought this day might never come because we've looked at this particular structure through the years, through my entire career.  We have never been able to sort out just how to do it that fits the NASCAR model that existed and that would be what I say would be very additive in the future.

            But we have today.  We have through the cooperation and the hard work of a lot of people.  I want to thank everybody who worked on this very important project.

            With that, I'm going to bring up Rob Kauffman.

            ROB KAUFFMAN:  Thank you very much.  Safe to say a fair amount of work in this process.  It was a very rewarding, challenging and interesting thing to work on.  It was really an honor and a privilege to work with all the teams, the professionals on all the teams, to really help try to represent their interests and get them all focused on a common goal.

            And really for Brian, in particular Brent, everyone in Daytona for being open-minded and thoughtful about once we had an idea of how to take something good and make it better, to really kind of embrace that, do to do the hard work and details and get it done.  It was a privilege to be able to work with everybody on this.

            I would say, though, it was a lot of work, but this is really just a foundation.  This is the first step in a process now.  As Brian said, we're kind of, in a way, you look at Daytona is a great track, always been historical, fantastic, a big renovation project, brand-new and ready for the future.  We kind of did the same thing with the structure of how the teams were organized in the sport with NASCAR.  It's worked pretty well for a long time, but it was ready for a renovation.  We put in the elbow grease and got it done.  Hopefully it will be equally as exciting and productive for the future.

            The charter system that's been created, really we were in a way lucky to be able to do is look at every other sport out there.  It has taken 60 years to get to this point, we looked at the NFL, Formula One, look at soccer, look at cricket, every professional sport that's out there, what made them successful, what challenges and problems they had.  What parts could we use, mix and match, make work for us.  Also looking at the history of NASCAR, trying to figure out, we have our own unique background.  I am a relative newcomer, only being involved 10 years.  There's a lot of history here to figure out how to square it all up and get it done.

            I think we focused on three key principles:  participation, economics, governance.  That's the foundation stones for how this new system works.

            At the end of the day, people sometimes give me a hard time, this is sort of the plumbing in the walls.  It's important for this all to be right.  Really for this whole venture to be successful, it's about great racing, fans being excited.  It's a sport.  That's what we have to focus on.  Growing the popularity, having a great product out there for people to enjoy.  At the end of the day, it has to be a reasonable business, but at the end of the day it's a sport.

            I think what we've done here is now we've put the teams on a more stable footing.  What does that mean?  I think it really allows the teams to invest for the future.  If you're living year to year, you can't really think about the long-term.  Here what you're able to do is say, Okay, I'm going to take this risk on this young driver, see how they work out, develop this crew chief, this crew member, even some of the technical sides, even your basic business infrastructure.  It's a step in the right direction.  I think all the work starts here.

            With that I'll leave it to Brent.

            BRENT DEWAR:  Thanks, Rob.

            As Brian mentioned, this is a landmark moment for our sport across many dimensions.  We really are at an unprecedented time in our history in terms of collaboration amongst all our industry stakeholders.  I'd like to take the opportunity at this moment to recognize our track partners for the close cooperation we experienced and the tireless efforts in completing the five-year track sanction agreements which we announced last fall.  It was absolutely a key enabler to many of the elements here in the team owner agreement.

            I'd also like to recognize our partners from the manufacturers, Toyota, Ford and Chevy, who have participated actively in the dialogue every step of the way to ensure further alignment of interest through our OEM car manufacturer council.

            Really today would not have been possible without the work of a number of folks that are in the room, both from my team at NASCAR, and also the NASCAR team owners, team presidents, the key executives.  Many of them are here in the room with us today.  Thank you for being here.  Thank you for their efforts this last 18 months.  More importantly, thanks for making it happen.

            A big applause to the team owners and my team for getting us to this point.

            So throughout the process, it was pretty clear from the outset that NASCAR and the team owners do have a strong alignment of shared interests.  You're going to hear this alignment of interests theme throughout today.  The agreement real builds on that, whether that be from fostering safety, making the best racing in the world even better, working together to drive top-line revenue, to improve the operating efficiencies of our businesses, to create a long-term sustainable business model for the Sprint Cup ownership in this sport.

            Really after almost 18 months of close cooperation and intense dialogue, and it was intense at times, many late nights, yes, the rumors are true, we did have work group meetings on Christmas Eve and New Year's Eve, the countless hours of collaborating both in person and on the phone.  We believe this is a landmark agreement because we're going from one-year agreement to a defined nine-year period which will enable us to plan and grow the sport for the next 20 years and beyond, while at the same time providing stability now to team operations and clarity to existing and potential sponsors and investors.

            So NASCAR has granted 36 charters which will have the transferrable rights that will provide NASCAR Sprint Cup team owners the opportunity to build long-term enterprise value.

            Now, the charter teams will have a guaranteed entry in the field which will provide operating efficiency and certainty, enabling the greater alignment of interests with other key stakeholders.  More defined and predictable revenue streams, which in term provides more advance fiscal and operational planning as well as operating efficiencies.

            Greater interest in the digital operations will create even more revenue opportunities for the industry at large.  The NASCAR digital model has been exploding over the last couple years.  We've shared a lot of those metrics with you.  In 2015 alone, we had 1.1 billion page views, 50 million video views, and 4.1 billion social impressions.

            An important element of this agreement is to align the team owner model with the growth of the digital business, from expanding whether it be racing products such as RaceView or NASCAR Drive, to creating new mobile apps, E sports, gaming, virtual reality, to looking at connecting the team sites through uniform platforms to both amplify and grow the digital fan base.

            This is just the beginning of what our imagination can possibly provide.  The charter team owners will have an increased participation also in the NASCAR governance as part of the Team Owner Council, and a committee structure that enables a more disciplined collaborative process that will lead to better quality decisions across the industry ecosystem.

            It will be a 40-car field comprised of 36 charter teams and four open teams for all points races.  To maintain the historical openness of the sport, non-charter race teams will be able to compete as open teams for four positions in the field.  The charter teams will have a guaranteed entry, as I mentioned, in all points races.  But all teams will compete for starting position via our qualifying format.

            This is a seminal moment for our sport.  We need to seize this historic opportunity to push forward in growing the sport together.  Tackling competition issues, innovation, digital marketing, research and development, and improving the competitive balance through the field.

            Really what we're talking about today is an announcement of improving the business model between NASCAR and our team owners.  We believe this new charter model will not only be good for the team owners but it's also going to be good for our fans, our drivers, our track promoters, our manufacturers and our sponsors by providing a strong foundation for industry growth while continuing to develop the best-in-class racing for many years to come.

            So we're proud of a lot of things today.  But one of the things I'm most proud of is that no one really took their eye off the ball in working behind the scenes.  A lot of you are wondering, how come it's so quiet, hush-hush.  This is the business part of the model.  We didn't take our eye off the ball, and also really what's most important of our core focus.  That's to have competitive racing for our fans every week at every track.

            We are truly excited about the 2016 race season, not because all these tireless nights are behind us and the grueling process to get us to this point in time, but really because at the end of the day we're all race fans, we're all racers, we're all competitors.  It's what our fans expect.  It's what we expect from ourselves.

            I thank everybody in the media and our groups for being here today to enjoy this moment.  Look forward to a great 2016 season.  The journey begins starting right now.  Thank you.

            DAVID HIGDON:  Thank you, gentlemen.

            A couple questions to get us started and then we'll open it up to the media.

            Mr. Petty, obviously you've been a member of the committee for a long time, have been involved in many historical moments in this sport.  Can you put into context what this means to you and your team.

            RICHARD PETTY:  Yeah, you know, I guess NASCAR started in, what, '47, '48.  I was nine years old, something like that.  To me, this is the second most important thing that's ever happened in NASCAR, because now the drivers and owners and stuff now can really work across the aisle.

            I was telling him a while ago, it's sort of like the democrats and republicans, they've been doing their thing, we've been doing our thing, meeting in the middle a little bit.  We're getting rid of that.  We're all going to be in the middle of the deal now.

            The owners, we don't understand how NASCAR works, okay?  They don't know how the race teams work.  So now we're going to be in the same room talking about the same problems and solving the problems together.

            From that standpoint, it's going to be one of the greatest things that's ever happened to NASCAR and Cup racing.  Like I say, I've been here a long time, I've seen a lot of stuff go under the bridge more or less.  But this is the next generation of what we're going to have to do to make racing that much bigger.

            DAVID HIGDON:  Thank you, sir.

            Mr. O'Donnell, wondering if you could touch a little bit on how this directly impacts the governance of the sport.  If you could perhaps give us some insight in terms of moving forward, including what we'll see ahead of us in Daytona Speedweeks.

            STEVE O'DONNELL:  I'd echo from what some of the King said, not only from his experience, but bringing the two groups together in a much more formal way, what that's going to allow us to do.  If you look at this sport, we have the best people in racing.  Being able to utilize those folks across as many decisions as possible only benefits the fans.

            The key part of this will be longer runways, working together and not just working on things that may affect us next week at Daytona, which we certainly have conversations about, but where are we going for 2020, 2021, how can we impact the fans, really grow the sport.

            I'm personally excited about it.  I think it's a tremendous opportunity for the sport and to grow the fan base.  Certainly as it affects Daytona.  A lot of dialogue has taken place for Speedweeks.  We will roll that out at the end of this week in terms of qualifying and some different things that the new charter system takes into effect.  I'd ask you to give us a couple days to put the finishing touches on that, but that will be coming here by Thursday.

            DAVID HIGDON:  Tommy, you've seen this sport from a lot of different capacities.  What does owning a charter mean for Tommy Baldwin Racing?

            TOMMY BALDWIN:  Rob and Brent touched on it a little bit.  It's just the stability.  It allows us to look so far ahead to be able to build the business, the brand.  That's the key for us.

            It's like everyone's touched on, it's been a journey.  I know Richard said 1947 or 1948, he was nine.  I was six or seven years old watching him at Islip Speedway race.  To be on this stage together seeing what we've accomplished together is pretty cool.

            DAVID HIGDON:  Steve, you played a significant role in this process.  Can you give us a little bit of a sense of how that went about and your perspective on it overall.

            STEVE NEWMARK:  Sure.  Undoubtedly the most notable aspect of this process for me was to just observe the unprecedented level of collaboration and cooperation among all the parties involved, whether it's team owners, team execs, drivers, tracks, everyone at NASCAR.  I think you hear a lot of that here.  It's not surprising there were a lot of different opinions, lots of different perspectives expressed during process.  You expect that with the diversity in our sport that we have.

            There was always an unwavering commitment to a single goal, a single mission.  That was to make our sport better and stronger for our fans and partners.  That commitment translated into a willingness of everyone involved to pursue and explore a complete paradigm shift in how we operate and to create a much stronger and stable foundation going forward.

            If you poll everyone involved in this process, the prevailing sentiment would be the collaborative precedent we set during this process bodes very well for our future.

            DAVID HIGDON:  Mike, how ultimately do you see this impacting our fans and what they'll see on the racetrack each and every week?

            MIKE HELTON:  It's a huge positive.  I think today's announcement serves as a testimony to the alignment of our industry's interest in doing what's good for the future of NASCAR.  When that's translated to what happens at the racetrack, I think fans understand very clearly that second only to safety is NASCAR and the garage area's interest in making the races entertaining and exciting.

            I think today's announcement speaks loudly to that because we know that racecar drivers want good, fast racecars.  With today's announcement and the team owners being able to predict their business models, to be able to build on their business models, to be excited about being in the sport, then we know the quality of that racecar is going to get better and the racing quality grows with it.

            DAVID HIGDON:  Time to open it up to the media.

            Q.  Steve or Mike, these charters are going to be able to be sold between teams.  When they change hands, when a charter is sold, will you announce it publicly and will the economics of the tracks be disclosed at all?

            STEVE O'DONNELL:  Yeah, I think it will.  We'll be transparent across it in terms of the ownership.  Rest assured the media will be going into Daytona or whatever race that may be of who is the owner of that particular vehicle.

            MIKE HELTON:  We kind of thought some transparency around this would be good.  The money is not the most interesting thing from a fan standpoint, but I think it's important to acknowledge that there's value growing in these things, how it's going.  It's somewhat interesting.  We have a mechanism in place to have some transparency system.  As they start to transact, might be a bit of a lag, but you'll see this is what happened to this one, this is who bought it, there will be somewhat of a tale of the tape on it, so to speak.

            Q.  Brian, what would your father or grandfather have thought of this agreement?  Where do you think it stands in the history of things that have been done in NASCAR?  What was the toughest part of making it happen?

            BRIAN FRANCE:  Well, I think changing the structure is the hardest thing, to balance everybody's interest.  That includes the tracks, that includes people who have made bets on us in different ways, television partners, so on, did it work for them.

            Your first question, how my father would have thought about it.  He would have obviously been conservative about this.  That's a nice way to say that (smiling).  But on the other hand I will say, I know this from my own career, I always brought him things through the years, whether it was consolidating our TV rights way back in the day, whatever it was, or the Chase, another good example, where you would have thought he wouldn't have been in favor of it.  But he always had enough confidence in me at the time and enough flexibility to know that he didn't have all the answers.

            I'll bet once he saw all the things unfold, because by the way, this is not a new idea that has been proposed to us recently, this has been an idea that was on the table in various forms for a long time.  So we've never been able to sort it out.

            I'll bet if he saw what I saw by some very talented people on this stage and on both sides of the aisle, wait a minute, if we thought about it this way, I bet he would have gotten onboard.  That would be my prediction.

            Q.  Steve, there was mention that the governance of the sport would now involve the owners in some way.  What specifically will the owners do?  Are we talking about rule changes at every level, that owners will have input on?  How will that work?

            STEVE O'DONNELL:  I think it's important to make a bit of distinction.  In all of the discussions, the owners were clear we still need a sanctioning body, we still need someone to run the races.  The cooperation across the aisle was tremendous.

            What governance really means, is looking at a lot of these long-term decisions that have a big financial impact on these teams, also a big impact on what the race product will look like.

            Historically we had some one-off discussions, but this really gives us a formal process to talk about where do we want to be in the next few years, how do we get there, what's the right timing to get there, collecting all that input and making a decision that we all believe is going to drive the sport forward.  It really formalizes that.  It's something we needed candidly and I look forward to.  I think looking at a lot of the experts out there in the industry will help us make even better and more informed decisions as we go on.

            Q.  Do you have the details as far as how the transferring of a charter would go, whether it's a lease, whether it's a sale?  There was some talk as far as performance detailing how and where people would stand as far as their charters would go, where you would have to be in points standings, so to speak, to maintain a charter over a long period of time.

            BRENT DEWAR:  Multi-level question there.  But 36 charters.  So the first question of transfer, it can be a permanent transfer.  That was part of what we talked about, the ability to create that aggregate value.  We also have a short-term transfer provision so the charter could be transferred one time during the first five years per racecar, and it would have to be for the full season.

            Steve, do you want to jump on that?

            STEVE NEWMARK:  I think that's fair.  One of the objectives we had as part of this process, from the team side in trying to create some long-term enterprise value, is to implement transferability rules that more resemble what you see in other sports.  The objectives of that would be to both provide more incentive for the owners to invest, but also make it more appealing for outside and new owners come in.

            That's really how you see this structure when it's memorialized in the agreement.  NASCAR does are oversight over the transfer process.  But ultimately this should hopefully facilitate a better market for team charters going forward.

            BRENT DEWAR:  To acquire a charter, you're going to have to acquire it through the existing 36 charters.

            Q.  Is there a performance-based incentive there that people will maintain their charters through that?  What was missing in this list of people, of teams rather, that have been I guess grandfathered in or already secured a charter for this top 36, how would somebody like the Wood Brothers get in going forward into the program?

            BRENT DEWAR:  There is a performance requirement for all of the existing charter members, to maintain that in good standing.  It's understood in the agreement.  Our goal is not to be taking charters away.  They're going to continue to drive and drive better performance.  There will be a notification process for them to maintain that good standing.

            To a current open team, there's not a way to race your way into a charter.  There is an ability to be an open team and to race for race purse and to compete as an open team.  We think that's important for the historical reference of the sport.  There is a lot of historical and institutional knowledge to become a racecar and race team owner.  We think having that avenue to be an open team is obviously a precursor opportunity for those that choose to go in that direction to become a charter team owner in the future.

            Q.  Brent, can you talk about how the revenue will be distributed.  You mentioned the owners can plan their budgets a little bit better knowing a certain amount of money they're going to be eligible for, how that works in race purses moving forward.  And, Rob, you were talking about transparency earlier.  Can you provide in your words the tale of the tape of your charters, where they're going, what you got for them and so forth?

            BRENT DEWAR:  I think the first thing was to have more simplicity and clarity of what we affectionately call the pool money.  We have a lot of good reasons for our historical way we did things.  So it will be basically four different areas that we would look at.  One would be race purse that both the charter teams and open teams will compete for.  One is going to be historical performance, looking at the competitiveness of the race teams to really drive to better perform over those last three-year averages.  One would be fixed-purse performance, which is the guaranteed entry.  And the fourth will be year-end point fund.

            Taking a lot of the historical elements, looking at trying to provide the stability elements and the competitive elements is the balance we looked at to achieve that.

            ROB KAUFFMAN:  I think one of my favorite topics, the money part, it doesn't really change night into day.  The economics of the sport are basically the economics of the sport.  I think there's growth, indexation, opportunities for new revenue to grow in the digital space, for example.  That's really where we hope the money will go in a positive direction.  How it's distributed is basically relatively similar.

            I think the big difference is, you can think of it almost like a building.  Instead of having a one-year lease, you have a nine-year lease.  You know you have that income for a whole nine years, you can plan better relative to certainty as opposed to quantity.

            In terms of the transferring of charters, we made a form attached to the contract, you fill it out, submit it to NASCAR, hopefully they approve it and it's on file.

            From a transparency standpoint, that will be available to other charter owners to see what the transaction was and it's disclosable.  It will be ultimately up to the parties to the transaction itself whether they want to make it public or not.  Given the interest and newness of it, they'll try to look at that.  Each individual transfer will have to figure that out for themselves.

            As it relates to the two charters that NWR is going to get, a basic tenet of this is use-it-or-lose-it.  If you're not going to race, you're not going to have it.  For those two slots to be available, those will have to be transferred before Daytona.  I think it's very likely JGR and Stewart-Haas will probably be acquiring those in the not-too-distant future.

            Step one was to get them to exist, which took us a little work through Friday night, and now that they exist we can work on moving them around.

            Q.  Steve, will the point system structure change at all?  Is it still 43 plus bonus for a win, considering now there are 40 cars?  And, Brent, obviously Rob just said you're going to have to start, but does the team have to be at a certain spot in points to keep the charter?  Also, how do you guarantee revenues through the point fund when you're looking for a new series sponsor so you really don't know exactly how much the point fund would be?

            STEVE O'DONNELL:  On the first one, again, that will come out probably in a more formal fashion Thursday.  We do plan on looking at the point system and matching that across all three of our national series.  Now with a field of 40, it does seem to make more sense to go one through 40.  That's what we're looking at.  Still a few steps to communicate, to work with the industry, but that is the plan.

            BRENT DEWAR:  Obviously as we said, the focus today wasn't on the economics, but there were obviously key economic elements in this.  The certainty we have over the nine-year period, there are certain elements that are uncertain during the nine-year period.  We as a group understand that, where the flexibility will be on those points, those elements as we go forward on the economics.

            We've got work to do.  As you get the idea, we have a five-year track agreement, and we're looking at a nine-year agreement here.  There are different stages of the various agreements for the stakeholders.  That will also be true for key entitlement sponsors.

            The teams understand what their requirements are going to be to maintain the charter from a performance standpoint.  The onus is in their hands to do that.  We feel very confident this is not about taking charters away, where they rank on the various levels throughout the season.  At the end of the season we'll have a notification process very similar to how other sports structures work.

            Q.  Steve O'Donnell, is there a chance in the future where we could see a system where the lowest charter team in the points could lose that charter to the highest non-charter team in the points, i.e., a type of relegation system you would see in European soccer leagues?

            STEVE O'DONNELL:  If you go back to what Rob talked about earlier, we did study a lot of different sports, including the EPL.  For us the best model is where we landed.

            I'd echo what Brent said.  Our goal is to have sustainable charters.  We're comfortable with the number that we have and believe that the number 36 in terms of charters, we don't want to be in the business of taking any away, we want to see them go out and compete, one through 36 have the opportunity to go win a championship.

            BRENT DEWAR:  When we studied the sports, you studied cricket.  I couldn't understand cricket.  Interesting times over the last 18 months.

            Q.  Brent, in the event that qualifying is rained out, how will you determine those last four spots?

            BRENT DEWAR:  That's a great question, but I'm going to refer that to Steve O'Donnell.

            STEVE O'DONNELL:  We'll communicate that on Thursday.  I think we met with the owners today and there's an understanding very similar to how we've always operated in terms of qualifying.  If there's a rain-out plan, there will be a plan in place.

            I think everyone is comfortable we've got plans in place not only for qualifying or the Duels, but we fully expect to be qualifying on Sunday in the sunshine.

            Q.  I realize this is probably somewhat set by market value, but does NASCAR have an expectation of what they want charters to cost when transferred?  Would Rob have any insight on this considering it sounds like you're transferring two of your charters to another team?

            BRIAN FRANCE:  No, we won't.  Obviously we've studied the relative values in all sports leagues, what they trade at.  We have some idea over time.

            But remember, it's been said a couple times, this is not from one moment to the next that we achieve all of our goals about what a charter will be worth over time.  The first was getting the structure.

            Let me say one other thing that is very important.  Starting with me, and I told our group, we meet every year, last week, we meet every year with our senior management team.  I told them this is going to change things all for the better because we are now aligned with our team owners.  We have to make them successful.  It's not enough to say, Well, I hope their business model works out, I hope we get the rules packages right, that doesn't affect their cost in a negative way.  I hope that they participate fairly with us over here.

            Those are all fine things to strive for.  We have to make them all happen.  The track operators who have been great, starting with their five-year agreements to help us do that, all realize that because these are going to be traded.  We want to be more attractive for other investors to come into the sport.  That means, very simply, that we've got to make the business model work better than it works today and improve on it every year.

            ROB KAUFFMAN:  We tried to strike a balance.  This is kind of new.  The fact is the economics that come from the TV package, NASCAR, the overall part of that, is probably on average between 20% and 40% of the budget, 25% of the budget to run a competitive car year in and year out.  In leagues where you see these telephone number transactions, much, much bigger economics relatively speaking.  I think we're trying hard.  This is certainly a significant sport and growing, but I think just measure-wise it's quite a bit different.

            As it relates to the values over time, I think if you're trying to grow the value, you don't have any way of tracking it, that makes it pretty hard to figure out, right?  That's like trying to see what real estate in a neighborhood is worth.

            We tried to put a system in place that kind of balances some level of discretion and privacy of a financial transaction between parties and have it out there in the public when it's appropriate.  As I said earlier, you'll see the transactions happen probably with some kind of lag after the appropriate paperwork is filed, actually transferred, et cetera, most of that activity will happen at the beginning of the season because you need to run it for the full season.

            Between now and Daytona, whatever transactions are going to occur are probably going to happen between now and the Daytona 500, probably somewhere running up into that week it will be more obvious where they are.

            If you ask me right now what do I think they're roughly worth, I would say single digits millions, low or highs.  Hard to pin on it, but I would say that's not a bad guess.  We'll see.

            Q.  Brian, how did y'all arrive at the nine-year length for this deal?  I'm guessing if it hadn't been completed in time for the start of this season, that would have caused a tremendous amount of headaches because if you put it off for a year, it kind of affects a lot of the things you had in the criteria.

            BRIAN FRANCE:  Yes.  Listen, when we say a nine-year agreement, this is the model that we're going to be building long into the future long after nine.  Nine years was a function of the foreseeable revenue model, television being one, and other related things that we could quantify.  So we couldn't speak for things that we didn't have any view on past that.

            But our hope is that this model works so well, and we're confident frankly that it will, that as long as our agreements, whatever they are, the major agreements, they'll always be running concurrently with those agreements long into the future, well after nine years.

            You're right on the timing.  We were running out of time.  When the season starts, that would have been it.  You never know.  This is a very, very complicated thing.  If we would have had to table it, pick it back up in the fall, I don't know about the momentum, who knows.  But it doesn't matter.  Everybody's talking about it.  I'm opening up Christmas gifts with my kids on Christmas Eve, my phone is blowing up.

            Q.  How many charters can a team own?  Can anybody come in off the street and get a charter, or does NASCAR have approval of that?  Does NASCAR get a cut of the transfer sale price?

            ROB KAUFFMAN:  First one is, four is the maximum, sort of like the system works now, four-car limits.

            Can anyone buy one?  I think there's some criteria, I can't make any bad jokes, but there's some provisions for people in good standing, reputable and the like, wherewithal.  It's a fairly open process because we're trying to expand the base of people involved.

            BRENT DEWAR:  We don't get a cut.  We have an administrative fee for processing.

            Q.  Do you approval of who?

            BRENT DEWAR:  Yes.

            TOMMY BALDWIN:  You can buy mine for $100 million.

            BRENT DEWAR:  I don't know if we'd approve that (laughter).

            ROB KAUFFMAN:  I'm not sure the check would clear.

            BRIAN FRANCE:  I didn't say that.  I'm happy.

            Q.  What was, for your respective areas, an important give you all had to give on, and a take that you all got respectively for your representation that made this agreement a go?

            BRIAN FRANCE:  That's a very good question.  There were a lot of gives and takes, I did tell you.  Conceptually on our end some of the things we needed to do but were different for us.

            One of the things I want to make a point of, that will hopefully answer your question at the same time, is to make this business model work over time, beyond the revenues, the different things contractually that are done, it's for us to have as many similarities as other franchise or other models, bad word, other league structures that are there, that work properly.

            That means that the collaboration that you get as an owner, the voice that you get as an owner on important matters, number one, it means the institutional knowledge you need to be successful.  We like to bring that barrier down over time.  That's a big barrier to entry if you look at new ownership to come in and be successful just with capital.  Very hard to do.  We'd like to make some common things that change that around to the extent we can in auto racing.

            So changing the whole structure for us was a huge thing that we needed to do.  But the whole concept of it for us.

            STEVE NEWMARK:  When you step back and look at the whole process, the area that got the most attention was how to find the right balancing act around governance.  From the team perspective, the owners respect the fact we need to have NASCAR as the sanctioning body, enforcing the rules, but the teams wanted a greater, more structured voice that Steve O'Donnell talked about.  Getting to that place was difficult at times.  We really went through a lot of different iterations to figure out, where is the right balance, how much influence should the teams have, how do we still maintain NASCAR with the right discretion to oversee the sport going forward.

            Ultimately we landed on the concept of the Team Owner Council, then there's a litany of different events that trigger when you have to have discussions.  I think we're all comfortable where we landed, but that was probably one of the more difficult things just to work through as we went through the process.

            BRENT DEWAR:  Having one-year agreements, maximum flexibility.  You can be responsive what happens year to year.  The downside is you don't have stability.  Finding the right balance, the reason it took us this long to get to this period, is thinking through the intended and unintended consequences of the next nine years, trying to memorialize this in the agreement.

            I think it pushed all of us to expand our thought process and still be nimble, we like the nimble aspect of our sport, but to build it into a much more structured agreement, which was an interesting tradeoff.

            STEVE O'DONNELL:  I would echo what Steve said on governance, probably the give-and-take dialogue.  I would say more what did you get.  For me personally sitting next to a person like Tommy today in a moment like this, here is a guy who has dedicated everything to the race business.  Knowing we're in this for a long-term together I think is a big deal and what it's all about.

            ROB KAUFFMAN:  The list is so incredibly long, we'd have to have memoirs for that.  Suffice it to say you take the array of team owners, teams we have involved with the sport right now, and the determination of those people, the success they have in their businesses, the competitive nature, just to agree what time the race starts is sometimes a bit of a challenge.

            I think everyone gave their pint of blood, so to speak.  Like a lot of transactions I've been lucky to participate in over time, at the end of the day a fair deal is where everyone compromised, no one is a hundred percent happen, but everyone says, This is a fair balance, I think we can live with it, go forward with it.

            From my standpoint we got something everyone can live with it, it's not perfect, but it's certainly a great step in the right direction and I think everyone's happy to move forward now.

            DAVID HIGDON:  Thank you, gentlemen, for joining us today.  We look forward to seeing you all at Daytona International Speedway very, very soon.