UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year period ended November 30, 2010

INTERNATIONAL SPEEDWAY CORPORATION

(Exact name of registrant as specified in its charter)

ONE DAYTONA BOULEVARD, DAYTONA BEACH, FLORIDA		32114
(Address of principal executive offices)		(Zip code)

FLORIDA		O-2384		59-0709342
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification Number)

Registrant’s telephone number, including area code: (386) 254-2700

Securities registered pursuant to Section 12 (b) of the Act:

Title of each class		Name of each exchange on which registered
Class A Common Stock — $.01 par value		NASDAQ/National Market System

Securities registered pursuant to Section 12 (g) of the Act:

Common Stock — $.10 par value
Class B Common Stock — $.01 par value
(Title of Class)

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

YES þ NO o

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

YES o NO þ

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 þ NO o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

YES þ NO o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (Section 229.405 of this chapter) 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 Form 10-K or any amendment to this Form 10-K. þ

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

Large accelerated filer þ		Accelerated filer o		Non-accelerated filer o		Smaller reporting company o
				(Do not check if a smaller reporting company)

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

YES o NO þ

The aggregate market value of the voting stock held by nonaffiliates of the registrant as of May 31, 2010 was $829,968,887.95 based upon the last reported sale price of the Class A Common Stock on the NASDAQ National Market System on Friday, May 28, 2010 and the assumption that all directors and executive officers of the Company, and their families, are affiliates.

At December 31, 2010, there were outstanding: No shares of Common Stock, $.10 par value per share, 27,668,585 shares of Class A Common Stock, $.01 par value per share, and 20,373,199 shares of Class B Common Stock, $.01 par value per share.

DOCUMENTS INCORPORATED BY REFERENCE. The information required by Part III is to be incorporated by reference from the definitive information statement which involves the election of directors at our April 2011 Annual Meeting of Shareholders and which is to be filed with the Commission not later than 120 days after November 30, 2010. Certain of the exhibits listed in Part IV are incorporated by reference from the Company’s Registration Statement filed on Form S-4, File No. 333-118168.

EXCEPT AS EXPRESSLY INDICATED OR UNLESS THE CONTEXT OTHERWISE REQUIRES, “ISC,” “WE,” “OUR,” “COMPANY,” “US,” OR “INTERNATIONAL SPEEDWAY” MEAN INTERNATIONAL SPEEDWAY CORPORATION, A FLORIDA CORPORATION, AND ITS SUBSIDIARIES.

 

 

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TABLE OF CONTENTS

PART I	4
ITEM 1. BUSINESS	4
ITEM 1A. RISK FACTORS	7
ITEM 1B. UNRESOLVED STAFF COMMENTS	11
ITEM 2. PROPERTIES	12
ITEM 3. LEGAL PROCEEDINGS	14
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	14
PART II	14
ITEM 5. MARKET PRICE OF AND DIVIDENDS ON REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS	14
ITEM 6. SELECTED FINANCIAL DATA	16
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	20
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	42
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	44
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	75
ITEM 9A. CONTROLS AND PROCEDURES	76
PART III	77
PART IV	77
ITEM 15. EXHIBITS, CONSOLIDATED FINANCIAL STATEMENT SCHEDULES	77
SIGNATURES	80
EX-21
EX-23.1
EX-23.2
EX-31.1
EX-31.2
EX-32
EX-99
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT

PART I

ITEM 1. BUSINESS

GENERAL

We are a leading owner of major motorsports entertainment facilities and promoter of motorsports themed entertainment activities in the United States. Our motorsports themed event operations consist principally of racing events at our major motorsports entertainment facilities. We currently own and/or operate 13 of the nation’s major motorsports entertainment facilities:

	•		Daytona International Speedway® in Florida;
	•		Talladega Superspeedway® in Alabama;
	•		Michigan International Speedway® in Michigan;
	•		Richmond International Raceway® in Virginia;
	•		Auto Club Speedway of Southern CaliforniaSM in California;
	•		Kansas Speedway® in Kansas;
	•		Chicagoland Speedway® in Illinois;
	•		Phoenix International Raceway® in Arizona;
	•		Homestead-Miami SpeedwaySM in Florida;
	•		Martinsville Speedway® in Virginia;
	•		Darlington Raceway® in South Carolina;
	•		Watkins Glen International® in New York; and
	•		Route 66 RacewaySM in Illinois.

In addition, we promote major motorsports activities in Montreal, Quebec, through our wholly owned subsidiary, Stock-Car Montreal.

In 2010, these motorsports entertainment facilities promoted well over 100 stock car, open wheel, sports car, truck, motorcycle and other racing events, including:

	•		21 National Association for Stock Car Auto Racing (“NASCAR”) Sprint Cup Series events;
	•		16 NASCAR Nationwide Series events;
	•		10 NASCAR Camping World Truck Series events;
	•		one National Hot Rod Association (“NHRA”) Full Throttle drag racing series event;
	•		six Grand American Road Racing Association (“Grand American”) events including the premier sports car endurance event in the United States, the Rolex 24 at Daytona; and
	•		a number of other prestigious stock car, sports car, open wheel and motorcycle events.

Our business consists principally of promoting racing events at these major motorsports entertainment facilities, which, in total, currently has approximately one million grandstand seats and 530 suites. We earn revenues and generate substantial cash flows primarily from admissions, television and ancillary media rights fees, promotion and sponsorship fees, hospitality rentals (including luxury suites, chalets and the hospitality portion of club seating), advertising revenues, royalties from licenses of our trademarks and track rentals. We own Americrown Service Corporation (“Americrown”), which provides catering, concessions and merchandise sales and service at certain of our motorsports entertainment facilities. We also own and operate the Motor Racing Network, Inc. radio network, or MRN Radio, the nation’s largest independent motorsports radio network in terms of event programming.

At the beginning of fiscal 2009, entitlement for the NASCAR Craftsman Truck series changed and became the NASCAR Camping World Truck Series. Throughout this document, the naming convention for these series is consistent with the current branding.

INCORPORATION

We were incorporated in 1953 under the laws of the State of Florida under the name “Bill France Racing, Inc.” and changed our name to “Daytona International Speedway Corporation” in 1957. With the groundbreaking for Talladega Superspeedway in 1968, we changed our name to “International Speedway Corporation.” Our principal executive offices are located at One Daytona Boulevard, Daytona Beach, Florida 32114, and our telephone number is (386) 254-2700. We maintain a website at http://www.internationalspeedwaycorporation.com/. The information on our website is not part of this report.

OPERATIONS

The general nature of our business is a motorsports themed amusement enterprise, furnishing amusement to the public in the form of motorsports themed entertainment. Our motorsports themed event operations consist principally of racing events at our major motorsports entertainment facilities, which include providing catering, merchandise and food concessions at our motorsports entertainment facilities that host NASCAR Sprint Cup Series events except for catering and food concessions at Chicagoland Speedway (“Chicagoland”) and Route 66 Raceway (“Route 66”). Our other operations include MRN Radio; our 50.0 percent equity investment in the joint venture SMISC, LLC (“SMISC”), which conducts business through a wholly owned subsidiary Motorsports Authentics, LLC; and certain other activities. We derived approximately 89.8 percent of our 2010 revenues from NASCAR-sanctioned racing events at our wholly owned motorsports entertainment facilities.

In addition to events sanctioned by NASCAR, in fiscal 2010, we promoted other stock car, open wheel, sports car, motorcycle and go-kart racing events.

Americrown — Food, Beverage and Merchandise Operations

We conduct, either through operations of the particular facility or through our wholly owned subsidiary operating under the name “Americrown,” souvenir merchandising operations, food and beverage concession operations and catering services, both in suites and chalets, for customers at each of our motorsports entertainment facilities with the exception of food and beverage concessions and catering services at Chicagoland and Route 66.

MRN Radio

Our subsidiary, Motor Racing Network, Inc., does business under the name “MRN Radio,” but is not a radio station. Rather, it creates motorsports-related programming content carried on radio stations around the country, as well as a national satellite radio service, Sirius XM Radio. MRN Radio produces and syndicates to radio stations live coverage of the NASCAR Sprint Cup, Nationwide and Camping World Truck series races and certain other races conducted at our motorsports entertainment facilities, as well as some races conducted at motorsports entertainment facilities we do not own. Sirius XM Radio also compensates MRN Radio for the contemporaneous re-airing of race broadcasts. MRN Radio produces and provides unique content to its website, motorracingnetwork.com, and derives revenue from the sale of advertising on such. Each track presently has the ability to separately contract for the rights to radio broadcasts of NASCAR and certain other events held at its facilities. In addition, MRN Radio provides production services for Sprint Vision, the trackside large screen video display units, at substantially all NASCAR Series event weekends. MRN Radio also produces and syndicates daily and weekly NASCAR racing-themed programs. MRN Radio derives revenue from the sale of national advertising contained in its syndicated programming, the sale of advertising and audio and video production services for Sprint Vision, as well as from rights fees paid by radio stations that broadcast the programming.

Other Activities

From time to time, we use our track facilities for testing for teams, driving schools, riding experiences, car shows, auto fairs, concerts and settings for television commercials, print advertisements and motion pictures. We also rent “show cars” for promotional events.

EQUITY INVESTMENTS

Kansas Hotel and Casino Development

We have a 50/50 partnership with Penn National Gaming (“Penn”) which is currently developing a casino and hotel project in Wyandotte County, on property adjacent to our Kansas Speedway facility. Penn serves as the managing member and is responsible for the development and operation of the casino and future hotel.

Motorsports Authentics

We partnered with Speedway Motorsports, Inc. in a 50/50 joint venture, SMISC, which, through its wholly owned subsidiary Motorsports Authentics, LLC conducts business under the name Motorsports Authentics (“MA”). MA designs, promotes, markets and distributes motorsports licensed merchandise.

Other Equity Investments

Our equity investments also included a 50.0 percent limited partnership investment in Stock-Car Montreal L.P. prior to the acquisition of the remaining interest in February 2009.

Competition

We are among the largest owners of major motorsports themed entertainment facilities based on revenues, number of facilities owned or operated, number of motorsports themed events promoted and market capitalization. Racing events compete with other professional sports such as football, basketball, hockey and baseball, as well as other recreational events and activities. Our events also compete with other racing events sanctioned by various racing bodies such as NASCAR, the American Sportbike Racing Association — Championship Cup Series, United States Auto Club (“USAC”), Sports Car Club of America (“SCCA”), Grand American, ARCA and others, many of which are often held on the same dates at separate motorsports entertainment facilities. We believe that the type and caliber of promoted racing events, facility location, sight lines, pricing, variety of motorsports themed amusement options and level of customer conveniences and amenities are the principal factors that distinguish competing motorsports entertainment facilities.

Employees

As of November 30, 2010 we had over 850 full-time employees. We also engage a significant number of temporary personnel to assist during periods of peak attendance at our events, some of whom are volunteers. None of our employees are represented by a labor union. We believe that we enjoy a good relationship with our employees.

Company Website Access and SEC Filings

The Company’s website may be accessed at http://www.internationalspeedwaycorporation.com/. Through a link on the Investor Relations portion of our internet website, you can access all of our filings with the Securities and Exchange Commission (“SEC”). However, in the event that the website is inaccessible our filings are available to the public over the internet at the SEC’s website at http://www.sec.gov. You may also read and copy any document we file with the SEC at its public reference facilities at 100 F Street, NE, Washington, D.C. 20549. You can also obtain copies of the documents at prescribed rates by writing to the Public Reference Room of the SEC at 100 F Street, NE, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference facilities. You can also obtain information about us at the offices of the National Association of Securities Dealers, 1735 K St., N.W., Washington, D.C. 20006.

ITEM 1A. RISK FACTORS

Forward-looking statements.

This report contains forward-looking statements. The documents incorporated into this report by reference may also contain forward-looking statements. You can identify a forward-looking statement by our use of the words “anticipate,” “estimate,” “expect,” “may,” “believe,” “objective,” “projection,” “forecast,” “goal,” and similar expressions. Forward-looking statements include our statements regarding the timing of future events, our anticipated future operations and our anticipated future financial position and cash requirements.

We believe that the expectations reflected in our forward-looking statements are reasonable. We do not know whether our expectations will ultimately prove correct.

In the section that follows below, in cautionary statements made elsewhere in this report, and in other filings we have made with the SEC, we list the important factors that could cause our actual results to differ from our expectations. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of the risk factors described below and other factors set forth in or incorporated by reference in this report.

These factors and cautionary statements apply to all future forward-looking statements we make. Many of these factors are beyond our ability to control or predict. Do not put undue reliance on forward-looking statements or project any future results based on such statements or on present or prior earnings levels.

Additional information concerning these, or other factors, which could cause the actual results to differ materially from those in our forward-looking statements is contained from time to time in our other SEC filings. Copies of those filings are available from us and/or the SEC.

Adverse changes in our relationships with NASCAR and other motorsports sanctioning bodies, or their present sanctioning practices, could limit our future success.

Our success has been, and is expected to remain, dependent on maintaining good working relationships with the organizations that sanction the races we promote at our facilities, particularly NASCAR. NASCAR-sanctioned races conducted at our wholly owned subsidiaries accounted for approximately 89.8 percent of our total revenues in fiscal 2010. Each NASCAR sanctioning agreement (and the accompanying media rights fees revenue) is awarded on an annual basis and NASCAR is not required to continue to enter into, renew or extend sanctioning agreements with us to conduct any event. Any adverse change in the present sanctioning practices, could adversely impact our operations and revenue. Moreover, although our general growth strategy includes the possible development and/or acquisition of additional motorsports entertainment facilities, we have no assurance that any sanctioning body, including

NASCAR, will enter into sanctioning agreements with us to conduct races at any newly developed or acquired motorsports entertainment facilities. Failure to obtain a sanctioning agreement for a major NASCAR event could negatively affect us. Similarly, although NASCAR has in the past approved our requests for realignment of sanctioned events, NASCAR is not obligated to modify its race schedules to allow us to schedule our races more efficiently or profitably.

Changes to media rights revenues could adversely affect us.

Domestic broadcast and ancillary media rights fees revenues are an important component of our revenue and earnings stream and any adverse changes to such rights fees revenues could adversely impact our results. The current long-term contracts, which expire in 2014, give us significant cash flow visibility. Any material changes in the media industry that could lead to differences in historical practices or decreases in the term and/or financial value of future broadcast agreements could have a material adverse affect on our revenues and financial results. For example, following fiscal 2006, NASCAR entered into new agreements related to these media rights and, as a result, the 2007 industry rights fees were less than the 2006 industry rights fees even though the gross average annual rights fee for the industry increased.

Changes, declines and delays in consumer and corporate spending as well as illiquid credit markets could adversely affect us.

Our financial results depend significantly upon a number of factors relating to discretionary consumer and corporate spending, including economic conditions affecting disposable consumer income and corporate budgets such as:

	•		employment;
	•		business conditions;
	•		interest rates; and
	•		taxation rates.

These factors can impact both attendance at our events and advertising and marketing dollars available from the motorsports industry’s principal sponsors and potential sponsors. Economic and other lifestyle conditions such as illiquid consumer and business credit markets adversely affect consumer and corporate spending thereby impacting our revenue, profitability and financial results. Further, changes in consumer behavior such as deferred purchasing decisions and decreased spending budgets adversely impact our cash flow visibility and revenues. The significant economic deterioration that occurred during fiscal 2008, for example, has impacted these areas of our business and our revenues and financial results.

Unavailability of credit on favorable terms can adversely impact our growth, development and capital spending plans. General economic conditions were significantly and negatively impacted by the September 11, 2001 terrorist attacks and the war in Iraq and could be similarly affected by any future attacks, by a terrorist attack at any mass gathering or fear of such attacks, or by other acts or prospects of war. Any future attacks or wars or related threats could also increase our expenses related to insurance, security or other related matters. A weakened economic and business climate, as well as consumer uncertainty and the loss of consumer confidence created by such a climate, could adversely affect our financial results. Finally, our financial results could also be adversely impacted by a widespread outbreak of a severe epidemiological crisis.

Delay, postponement or cancellation of major motorsports events because of weather or other factors could adversely affect us.

We promote outdoor motorsports entertainment events. Weather conditions affect sales of, among other things, tickets, food, drinks and merchandise at these events. Poor weather conditions prior to an event, or even the forecast of poor weather conditions, could have a negative impact on us, particularly for walk-up ticket sales to events which are not sold out in advance. If an event scheduled for one of our facilities is delayed or postponed because of weather or other reasons such as, for example, the general postponement of all major sporting events in the United States following the September 11, 2001 terrorism attacks, we could incur increased expenses associated with conducting the rescheduled event, as well as possible decreased revenues from tickets, food, drinks and merchandise at the rescheduled event. If such an event is cancelled, we would incur the expenses associated with preparing to conduct the event as well as losing the revenues, including any live broadcast revenues, associated with the event, to the extent such losses were not covered by insurance.

If a cancelled event is part of the NASCAR Sprint Cup, NASCAR Nationwide or NASCAR Camping World Truck series, in the year of cancellation we could experience a reduction in the amount of money we expect to receive from television revenues for all of our

NASCAR-sanctioned events in the series that experienced the cancellation. This would occur if, as a result of the cancellation, and without regard to whether the cancelled event was scheduled for one of our facilities, NASCAR experienced a reduction in television revenues greater than the amount scheduled to be paid to the promoter of the cancelled event.

France Family Group control of NASCAR creates conflicts of interest.

Members of the France Family Group own and control NASCAR. James C. France, our Chairman of the Board, and Lesa France Kennedy, our Vice Chairman and Chief Executive Officer, are both members of the France Family Group in addition to holding positions with NASCAR. Each of them, as well as our general counsel, spends part of his or her time on NASCAR’s business. Because of these relationships, even though all related party transactions are approved by our Audit Committee, certain potential conflicts of interest between us and NASCAR exist with respect to, among other things:

	•		the terms of any sanctioning agreements that may be awarded to us by NASCAR;
	•		the amount of time the employees mentioned above and certain of our other employees devote to NASCAR’s affairs; and
	•		the amounts charged or paid to NASCAR for office rental, transportation costs, shared executives, administrative expenses and similar items.

France Family Group members, together, beneficially own approximately 38.0 percent of our capital stock and over 70.2 percent of the combined voting power of both classes of our common stock. Historically members of the France Family Group have voted their shares of common stock in the same manner. Accordingly, they can (without the approval of our other shareholders) elect our entire Board of Directors and determine the outcome of various matters submitted to shareholders for approval, including fundamental corporate transactions and have done so in the past. If holders of class B common stock other than the France Family Group elect to convert their beneficially owned shares of class B common stock into shares of class A common stock and members of the France Family Group do not convert their shares, the relative voting power of the France Family Group will increase. Voting control by the France Family Group may discourage certain types of transactions involving an actual or potential change in control of us, including transactions in which the holders of class A common stock might receive a premium for their shares over prevailing market prices.

Our success depends on the availability and performance of key personnel

Our continued success depends upon the availability and performance of our senior management team which possesses unique and extensive industry knowledge and experience. Our inability to retain and attract key employees in the future, could have a negative effect on our operations and business plans.

Future impairment of goodwill and other intangible assets or long-lived assets by us or our equity investments and joint ventures could adversely affect our financial results

Our consolidated balance sheets include significant amounts of goodwill and other intangible assets and long-lived assets which could be subject to impairment.

	•		In fiscal 2008, we recorded a before-tax charge of approximately $2.2 million as an impairment of long-lived assets primarily attributable to costs associated with the fill removal process at our Staten Island property and impairments of certain other long-lived assets;
	•		In fiscal 2009, we recorded a before-tax charge of approximately $16.7 million as an impairment of long-lived assets primarily attributable to the reduction of the carrying value of our Staten Island property and impairment charges relating to certain other long-lived assets; and
	•		In fiscal 2010, we recorded a before-tax charge of approximately $8.9 million as an impairment of long-lived assets primarily attributable to the non-cash impairment of certain costs related to the Daytona Development Project and removal of certain other long-lived assets located at our motorsports facilities.

As of November 30, 2010, goodwill and other intangible assets and property and equipment accounts for approximately $1,674.2 million, or 89.1 percent of our total assets. We account for our goodwill and other intangible assets in accordance with Accounting Standards Codification (“ASC”) 350 and for our long-lived assets in accordance with ASC 360. Both ASC 350 and 360 require testing goodwill and other intangible assets and long-lived assets for impairment based on assumptions regarding our future business outlook. While we continue to review and analyze many factors that can impact our business prospects in the future, our analyses are subjective and are based on conditions existing at and trends leading up to the time the assumptions are made. Actual results could differ materially from these assumptions. Our judgments with regard to our future business prospects could impact whether or not an impairment is deemed to have occurred, as well as the timing of the recognition of such an impairment charge. If future testing for impairment of goodwill and other intangible assets or long-lived assets results in a reduction in their carrying value, we will be required to take the amount of the reduction in such goodwill and other intangible assets or long-lived assets as a non-cash charge against operating income, which would also reduce shareholders’ equity.

In addition, our growth strategy includes investing in certain joint venture opportunities. In these equity investments we exert significant influence on the investee but do not have effective control over the investee, which adds an additional element of risk that can adversely impact our financial position and results of operations. Our equity investments total approximately $43.7 million at November 30, 2010.

Personal injuries to spectators and participants could adversely affect financial results.

Motorsports can be dangerous to participants and spectators. We maintain insurance policies that provide coverage within limits that we believe should generally be sufficient to protect us from a large financial loss due to liability for personal injuries sustained by persons on our property in the ordinary course of our business. There can be no assurance, however, that the insurance will be adequate or available at all times and in all circumstances. Our financial condition and results of operations could be affected negatively to the extent claims and expenses in connection with these injuries are greater than insurance recoveries or if insurance coverage for these exposures becomes unavailable or prohibitively expensive.

In addition, sanctioning bodies could impose more stringent rules and regulations for safety, security and operational activities. Such regulations include, for example, the installation of new retaining walls at our facilities, which have increased our capital expenditures, and increased security procedures which have increased our operational expenses.

We operate in a highly competitive environment

As an entertainment company, our racing events face competition from other spectator-oriented sporting events and other leisure, entertainment and recreational activities, including professional football, basketball, hockey and baseball. As a result, our revenues are affected by the general popularity of motorsports, the availability of alternative forms of recreation and changing consumer preferences and habits, including how consumers consume entertainment. Our racing events also compete with other racing events sanctioned by various racing bodies such as NASCAR, USAC, NHRA, International Motorsports Association, SCCA, Grand American, ARCA and others. Many sports and entertainment businesses have resources that exceed ours.

We are subject to changing governmental regulations and legal standards that could increase our expenses

We believe that our operations are in material compliance with all applicable federal, state and local environmental, land use and other laws and regulations.

If it is determined that damage to persons or property or contamination of the environment has been caused or exacerbated by the operation or conduct of our business or by pollutants, substances, contaminants or wastes used, generated or disposed of by us, or if pollutants, substances, contaminants or wastes are found on property currently or previously owned or operated by us, we may be held liable for such damage and may be required to pay the cost of investigation and/or remediation of such contamination or any related damage. The amount of such liability as to which we are self-insured could be material.

State and local laws relating to the protection of the environment also can include noise abatement laws that may be applicable to our racing events.

Our existing facilities continue to be used in situations where the standards for new facilities to comply with certain laws and regulations, including the Americans with Disabilities Act, are constantly evolving. Changes in the provisions or application of federal, state or local environmental, land use or other laws, regulations or requirements to our facilities or operations, or the discovery of previously unknown conditions, also could require us to make additional material expenditures to remediate or attain compliance.

Regulations governing the use and development of real estate may prevent us from acquiring or developing prime locations for motorsports entertainment facilities, substantially delay or complicate the process of improving existing facilities, and/or increase the costs of any of such activities.

Our quarterly results are subject to seasonality and variability

We derive most of our income from a limited number of NASCAR-sanctioned races. As a result, our business has been, and is expected to remain, highly seasonal based on the timing of major racing events. For example, in fiscal years 2008 and prior, one of our NASCAR Sprint Cup races was traditionally held on the Sunday preceding Labor Day. Accordingly, the revenues and expenses for that race and/or the related supporting events may be recognized in either the fiscal quarter ending August 31 or the fiscal quarter ending November 30.

Future schedule changes as determined by NASCAR or other sanctioning bodies, as well as the acquisition of additional, or divestiture of existing, motorsports entertainment facilities could impact the timing of our major events in comparison to prior or future periods.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None

ITEM 2. PROPERTIES

Motorsports Entertainment Facilities

The following table sets forth current information relating to each of our motorsports entertainment facilities as of November 30, 2010:

												NASCAR
				2010 YEAR END								SPRINT				OTHER						MEDIA
TRACK NAME		LOCATION		CAPACITY								CUP				MAJOR				MARKETS		MARKET
				SEATS				SUITES				EVENTS				EVENTS(1)				SERVED		RANK
Daytona International Speedway		Daytona Beach, Florida			147,000				98				4				7			Orlando/Central Florida			19
Talladega Superspeedway		Talladega, Alabama			135,000				30				2				3			Atlanta/ Birmingham			8/40
Michigan International Speedway		Brooklyn, Michigan			120,000				46				2				3			Detroit			11
Richmond International Raceway		Richmond, Virginia			95,000				40				2				2			Washington D.C.			9
Auto Club Speedway of Southern California		Fontana, California			84,000				91				2				3			Los Angeles			2
Kansas Speedway		Kansas City, Kansas			80,000				54				1				4			Kansas City			31
Chicagoland Speedway		Joliet, Illinois			69,000				25				1				4			Chicago			3
Homestead-Miami Speedway		Homestead, Florida			63,000				58				1				4			Miami			16
Martinsville Speedway		Martinsville, Virginia			61,000				21				2				2			Greensboro/Winston-Salem			47
Darlington Raceway		Darlington, South Carolina			61,000				13				1				2			Columbia			78
Phoenix International Raceway		Phoenix, Arizona			55,000				46				2				3			Phoenix			12
Watkins Glen International		Watkins Glen, New York			35,000				4				1				4			Buffalo/Rochester			51/81
Route 66 Raceway		Joliet, Illinois			24,000				26				—				1	(2)		Chicago			3

DAYTONA INTERNATIONAL SPEEDWAY. Daytona International Speedway is a 2.5 mile high-banked, lighted, asphalt, tri-oval superspeedway that also includes a 3.6-mile road course. We lease the land on which Daytona International Speedway is located from the City of Daytona Beach. The lease on the property expires in 2054, including renewal options. The facility is situated on 440 acres and is located in Daytona Beach, Florida.

TALLADEGA SUPERSPEEDWAY. Talladega Superspeedway is a 2.6 mile high-banked, asphalt, tri-oval superspeedway with a 1.3-mile infield road course. The facility is situated on 1,435 acres and is located about 90 minutes from Atlanta, Georgia and 45 minutes from Birmingham, Alabama.

MICHIGAN INTERNATIONAL SPEEDWAY. Michigan International Speedway is a 2.0 mile moderately-banked, asphalt, tri-oval superspeedway. The facility is situated on 1,180 acres and is located in Brooklyn, Michigan, approximately 70 miles southwest of Detroit and 18 miles southeast of Jackson.

RICHMOND INTERNATIONAL RACEWAY. Richmond International Raceway is a 0.8 mile moderately-banked, lighted, asphalt, oval, intermediate speedway. The facility is situated on 635 acres and is located approximately 10 miles from downtown Richmond, Virginia.

AUTO CLUB SPEEDWAY OF SOUTHERN CALIFORNIA. Auto Club Speedway of Southern California is a 2.0 mile moderately-banked, lighted, asphalt, tri-oval superspeedway. The facility is situated on 566 acres and is located approximately 40 miles east of Los Angeles in Fontana, California. The facility also includes a quarter mile drag strip and a 2.8-mile road course.

KANSAS SPEEDWAY. Kansas Speedway is a 1.5 mile moderately-banked, asphalt, tri-oval superspeedway. The facility is situated on 1,000 acres and is located in Kansas City, Kansas.

CHICAGOLAND SPEEDWAY. Chicagoland Speedway is a 1.5 mile moderately-banked, lighted, asphalt, tri-oval superspeedway. The facility is situated on 930 acres and is located in Joliet, Illinois, approximately 35 miles from Chicago, Illinois.

HOMESTEAD-MIAMI SPEEDWAY. Homestead-Miami Speedway is a 1.5 mile variable-degree banked, lighted, asphalt, oval superspeedway. The facility is situated on 404 acres and is located in Homestead, Florida. Homestead-Miami Speedway is owned by the City of Homestead, however we operate Homestead-Miami Speedway under an agreement that expires in 2075, including renewal options.

MARTINSVILLE SPEEDWAY. Martinsville Speedway is a 0.5 mile moderately-banked, asphalt and concrete, oval speedway. The facility is situated on 250 acres and is located in Martinsville, Virginia, approximately 50 miles north of Winston-Salem, North Carolina.

DARLINGTON RACEWAY. Darlington Raceway is a 1.3 mile high-banked, lighted, asphalt, egg-shaped superspeedway. The facility is situated on 230 acres and is located in Darlington, South Carolina.

PHOENIX INTERNATIONAL RACEWAY. Phoenix International Raceway is a 1.0 mile low-banked, lighted, asphalt, oval superspeedway. The facility is situated on 598 acres that also includes a 1.5-mile road course located near Phoenix, Arizona.

WATKINS GLEN INTERNATIONAL. Watkins Glen International includes 3.4-mile and 2.4-mile road course tracks. The facility is situated on 1,377 acres and is located near Watkins Glen, New York.

ROUTE 66 RACEWAY. Route 66 Raceway includes a quarter mile drag strip and dirt oval speedway. The facility, adjacent to Chicgoland, is situated on 240 acres and is located in Joliet, Illinois, approximately 35 miles from Chicago, Illinois.

OTHER FACILITIES: We promote major motorsports activities in Montreal, Quebec, through our wholly owned subsidiary, Stock-Car Montreal. We own approximately 170 acres of real property near Daytona International Speedway which is home to our corporate headquarters and other offices and facilities. In addition, we also own 500 acres near Daytona on which we conduct agricultural operations except during events when they are used for parking and other ancillary purposes. We also own concession facilities in Talladega, Alabama. We lease real estate and office space in Talladega, Alabama and the property and premises at the Talladega Municipal Airport. Our wholly owned subsidiary, Phoenix Speedway Corp. leases office space in Avondale, Arizona and the Auto Club Speedway of Southern California (“Auto Club Speedway”) leases an office location in Los Angeles, California.

Through our majority-owned subsidiary, 380 Development, LLC (“380 Development”), we purchased approximately 676 acres in the New York City borough of Staten Island that we targeted for the development of a major motorsports entertainment and retail development project. In November 2006, due to a variety of factors, we decided to discontinue pursuit of a speedway development on

Staten Island. We are currently pursuing the sale of the property (see “Equity and Other Investments — Staten Island Property” for further discussion).

Intellectual Property

We have various registered and common law trademark rights, including, but not limited to, “California Speedway,” “Chicagoland Speedway,” “Darlington Raceway,” “The Great American Race,” “Southern 500,” “Too Tough to Tame,” “Daytona International Speedway,” “ Daytona 500 EXperience,” the “Daytona 500,” the “24 Hours of Daytona,” “Acceleration Alley,” “Daytona Dream Laps,” “Speedweeks,” “World Center of Racing,” “Homestead-Miami Speedway,” “Kansas Speedway,” “Martinsville Speedway,” “Michigan International Speedway,” “Phoenix International Raceway,” “Richmond International Raceway,” “Route 66 Raceway,” “The Action Track,” “Talladega Superspeedway,” “Watkins Glen International,” “The Glen,” “Americrown,” “Motor Racing Network,” “MRN,” and related logos. We also have licenses from NASCAR, various drivers and other businesses to use names and logos for merchandising programs and product sales. Our policy is to protect our intellectual property rights vigorously, through litigation, if necessary, chiefly because of their proprietary value in merchandise and promotional sales.

ITEM 3. LEGAL PROCEEDINGS

From time to time, we are a party to routine litigation incidental to our business. We do not believe that the resolution of any or all of such litigation will have a material adverse effect on our financial condition or results of operations.

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

No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this report.

PART II

ITEM 5. MARKET PRICE OF AND DIVIDENDS ON REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

At November 30, 2010, we had two issued classes of capital stock: class A common stock, $.01 par value per share, and class B common stock, $.01 par value per share. The class A common stock is traded on the NASDAQ National Market System under the symbol “ISCA.” The class B common stock is traded on the Over-The-Counter Bulletin Board under the symbol “ISCB.OB” and, at the option of the holder, is convertible to class A common stock at any time. As of November 30, 2010, there were approximately 2,315 record holders of class A common stock and approximately 451 record holders of class B common stock.

The reported high and low sales prices or high and low bid information, as applicable, for each quarter indicated are as follows:

		ISCA								ISCB.OB(1)
		High				Low				High				Low
Fiscal 2009:
First Quarter		$	31.07			$	18.91			$	30.67			$	19.01
Second Quarter			25.38				15.96				25.25				16.20
Third Quarter			28.76				23.70				28.63				23.65
Fourth Quarter			28.95				25.21				28.30				25.00
Fiscal 2010:
First Quarter		$	30.20			$	24.97			$	29.63			$	24.75
Second Quarter			31.12				25.00				32.00				25.00
Third Quarter			28.14				22.50				28.00				22.45
Fourth Quarter			25.63				22.34				25.50				22.00

Stock Purchase Plan

An important component of our capital allocation strategy is returning capital to shareholders. We have solid operating margins that generate substantial operating cash flow. Using these internally generated proceeds, we have returned a significant amount of capital to shareholders primarily through our share repurchase program.

In December 2006, we implemented a share repurchase program under which we are authorized to purchase up to $150.0 million of our outstanding Class A common shares. In February 2008, we announced that our Board of Directors had authorized an incremental $100.0 million share repurchase program. Collectively these programs are described as the “Stock Purchase Plans.” The Stock Purchase Plans allow us to purchase up to $250.0 million of our outstanding Class A common shares. The timing and amount of any shares repurchased under the Stock Purchase Plans will depend on a variety of factors, including price, corporate and regulatory requirements, capital availability and other market conditions. The Stock Purchase Plans may be suspended or discontinued at any time without prior notice. No shares have been or will be knowingly purchased from Company insiders or their affiliates.

														(d) Maximum number
														of shares
														(or approximate
														dollar
										(c) Total number of				value of shares)
										shares purchased as				that may yet be
										part of publicly				purchased under the
		(a) Total number				(b) Average price				announced plans or				plans or programs
Period		of shares purchased				paid per share				Programs				(in thousands)
December 1, 2009— August 31, 2010
Repurchase program (1)			185,070			$	28.53				185,070			$	32,000
Employee transactions (2)			11,060				25.77				—
Other (3)			219,388				25.47				—
September 1, 2010 — September 30, 2010
Repurchase program (1)			30,050				22.91				30,050				31,298
October 1, 2010 — October 31, 2010
Repurchase program (1)			43,500				22.81				43,500				30,306
November 1, 2010 — November 30, 2010
Repurchase program (1)			49,266				22.86				49,266				29,180
			538,334								307,886

Dividends

Annual dividends were declared in the quarter ended in May and paid in June in the fiscal years reported below on all common stock that was issued at the time (amount per share):

Fiscal Year:		Annual Dividend
2006			0.08
2007			0.10
2008			0.12
2009			0.14
2010			0.16

Securities Authorized For Issuance Under Equity Compensation Plans

Equity Compensation Plan Information

Number of

securities

remaining available

Number of

for future issuance

securities to be

under equity

issued upon

Weighted-average

compensation plans

exercise of

exercise price of

(excluding

outstanding

outstanding

securities

options, warrants

options, warrants

reflected in column

and rights

and rights

(a))

Plan Category

(a)

(b)

(c)

Equity compensation plans approved by security holders

272,641

$

40.94

705,101

Equity compensation plans not approved by security holders

—

—

—

Total

272,641

$

40.94

705,101

ITEM 6. SELECTED FINANCIAL DATA

The following table sets forth our selected financial data as of and for each of the last five fiscal years in the period ended November 30, 2010. The income statement data for the three fiscal years in the period ended November 30, 2010, and the balance sheet data as of November 30, 2009 and November 30, 2010, have been derived from our audited historical consolidated financial statements included elsewhere in this report. The balance sheet data as of November 30, 2008, and the income statement data and the balance sheet data as of and for the fiscal years ended November 30, 2007 and 2006, have been derived from our audited historical consolidated financial statements, which are available on our website. You should read the selected financial data set forth below in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and the accompanying notes included elsewhere in this report.

		For the Year Ended November 30,
		2006				2007				2008				2009				2010
		(in thousands, except share and per share data)
Income Statement Data:
Revenues:
Admissions, net		$	235,251			$	253,685			$	236,105			$	195,509			$	160,476
Motorsports related			463,891				465,469				462,835				432,217				420,910
Food, beverage and merchandise			87,288				84,163				78,119				56,397				52,527
Other			9,735				10,911				10,195				9,040				11,444
Total revenues			796,165				814,228				787,254				693,163				645,357
Expenses:
Direct:
Prize and point fund monies and NASCAR sanction fees			151,203				151,311				154,655				162,960				157,571
Motorsports related			142,241				160,387				166,047				149,826				142,603
Food, beverage and merchandise			53,141				48,490				48,159				39,134				36,949
General and administrative			106,497				118,982				109,439				103,773				102,733
Depreciation and amortization(1)			56,833				80,205				70,911				72,900				74,465
Impairment of long-lived assets(2)			87,084				13,110				2,237				16,747				8,859
Total expenses			596,999				572,485				551,448				545,340				523,180
Operating income			199,166				241,743				235,806				147,823				122,177
Interest income and other(3)			5,312				4,990				(1,630	)			1,080				170
Interest expense			(12,349	)			(15,628	)			(15,861	)			(19,203	)			(15,216	)
Interest rate swap expense(4)			—				—				—				(4,268	)			(23,878	)
Loss on early redemption of debt(5)			—				—				—				—				(6,535	)
Other income			—				—				324				426				—
Equity in net income (loss) from equity investments(6)			318				(58,147	)			(1,203	)			(77,608	)			(1,904	)
Income from continuing operations before income taxes			192,447				172,958				217,436				48,250				74,814
Income taxes(7)			75,467				86,667				82,678				41,265				20,236
Income from continuing operations			116,980				86,291				134,758				6,985				54,578
Loss from discontinued operations			(176	)			(90	)			(163	)			(170	)			(47	)
Net income		$	116,804			$	86,201			$	134,595			$	6,815			$	54,531
Basic Earnings per share:
Income from continuing operations		$	2.20			$	1.64			$	2.71			$	0.14			$	1.13
Loss from discontinued operations			—				—				—				—				—
Net income		$	2.20			$	1.64			$	2.71			$	0.14			$	1.13
Diluted earnings per share:
Income from continuing operations		$	2.20			$	1.64			$	2.71			$	0.14			$	1.13
Loss from discontinued operations			(0.01	)			—				—				—				—
Net income		$	2.19			$	1.64			$	2.71			$	0.14			$	1.13
Dividends per share		$	0.08			$	0.10			$	0.12			$	0.14			$	0.16
Weighted average shares outstanding:
Basic			53,166,458				52,557,550				49,589,465				48,520,661				48,101,529
Diluted			53,270,623				52,669,934				49,688,909				48,633,730				48,194,837
Balance Sheet Data (at end of period):
Cash and cash equivalents		$	59,681			$	57,316			$	218,920			$	158,572			$	84,166
Working capital (deficit)			7,298				(52,477	)			(27,760	)			104,039				58,267
Total assets			1,922,059				1,982,117				2,180,819				1,908,903				1,878,749
Long-term debt			367,324				375,009				422,045				343,793				303,074
Total debt			368,094				377,547				575,047				347,180				306,290
Total shareholders’ equity			1,155,115				1,159,088				1,149,951				1,147,253				1,187,177

(1)

Fiscal years 2007, 2008 and 2009 include accelerated depreciation for certain office and related buildings in Daytona Beach, FL totaling approximately $14.7 million, $2.1 million, and $1.0 million, respectively.

(2)		Fiscal 2006 impairments are primarily due to our decision to discontinue our speedway development on Staten Island. Fiscal 2007 impairment is primarily related to our decision to discontinue development efforts in Kitsap County, Washington, and costs related to fill removal on our Staten Island property. Fiscal 2008 impairment is primarily attributable to costs related to fill removal on our Staten Island property and the net book value of certain assets retired from service. Fiscal 2009 impairment is primarily attributed to the decrease in the carrying value of our Staten Island property and, to a much lesser extent, impairments of certain other long-lived assets. Fiscal 2010 impairment is primarily attributable to the non-cash impairment of certain costs related to the Daytona Development Project and, to a much lesser extent, removal of certain other long-lived assets.
(3)		Fiscal 2008 interest income and other includes a non-cash charge totaling approximately $3.8 million to correct the carrying value of certain other assets.
(4)		Fiscal years 2009 and 2010 include expenses related to an interest rate swap (see “Future Liquidity”).
(5)		In fiscal 2010, we recorded a loss on early redemption of debt related to a cash tender offer where we purchased approximately $63.0 million of outstanding Senior Notes (see “Future Liquidity”).
(6)		Fiscal years 2007 and 2009 include impairment of goodwill and intangible assets and write-down of certain inventory and related assets by MA.
(7)		Fiscal 2009 income taxes includes interest income totaling approximately $8.9 million related to the settlement with the Internal Revenue Service. Fiscal 2010 income taxes includes the de-recognition of potential interest and penalties associated with certain state tax settlements of approximately $6.3 million.

GAAP to Non-GAAP Reconciliation

The following financial information is presented below using other than U.S. generally accepted accounting principles (“non-GAAP”), and is reconciled to comparable information presented using GAAP. Non-GAAP net income and diluted earnings per share below are derived by adjusting amounts determined in accordance with GAAP for certain items presented in the accompanying selected operating statement data, net of taxes.

We believe such non-GAAP information is useful and meaningful, and is used by investors to assess our core operations, which consist of the ongoing promotion of racing events at our major motorsports entertainment facilities. Such non-GAAP information identifies and separately displays the equity investment earnings and losses and adjusts for items that are not considered to be reflective of our continuing core operations at our motorsports entertainment facilities. We believe that such non-GAAP information improves the comparability of the operating results and provides a better understanding of the performance of our core operations for the periods presented. We use this non-GAAP information to analyze the current performance and trends and make decisions regarding future ongoing operations. This non-GAAP financial information may not be comparable to similarly titled measures used by other entities and should not be considered as an alternative to operating income, net income or diluted earnings per share, which are determined in accordance with GAAP. The presentation of this non-GAAP financial information is not intended to be considered independent of or as a substitute for results prepared in accordance with GAAP. Management uses both GAAP and non-GAAP information in evaluating and operating the business and as such deemed it important to provide such information to investors.

The 2006 adjustment relates to Motorsports Authentics — equity in net loss from equity investment and the impairment of long-lived assets as a result of our decision to discontinue our speedway development project on Staten Island.

The adjustments for 2007 relate to Motorsports Authentics — equity in net loss from equity investment, which includes an impairment of goodwill and intangible assets and write-down of certain inventory and related assets; accelerated depreciation for certain office and related buildings in Daytona Beach; and, the impairment of long-lived assets primarily related to our decision to discontinue development efforts in Kitsap County, Washington, and costs related to fill removal on our Staten Island property.

The adjustments for 2008 relate to Motorsports Authentics — equity in net income from equity investment; accelerated depreciation for certain office and related buildings in Daytona Beach; the impairment of long-lived assets associated with the fill removal process on the Staten Island property and the net book value of certain assets retired from service; a non-cash charge to correct the carrying value of certain other assets; a provision on working capital advances associated with our joint venture project in Kansas for the development of a gaming and entertainment destination; and, a tax benefit associated with certain restructuring initiatives.

The adjustments for 2009 relate to Motorsports Authentics — equity in net loss from equity investment, which includes the non-cash impairment charge; accelerated depreciation for certain office and related buildings in Daytona Beach; impairments of long-lived assets primarily attributable to the decrease in the carrying value of our Staten Island property and, to a much lesser extent, impairments of certain other long-lived assets; interest rate swap expense; and, interest income related to our settlement with the Internal Revenue Service.

The adjustments for 2010 relate to Hollywood Casino at Kansas Speedway — equity in net loss from equity investment; impairments of long-lived assets primarily attributable to certain costs related to the Daytona Development Project which were capitalized and are no longer expected to benefit the future development of the project and, to a much lesser extent, impairments of certain other long-lived assets; interest rate swap expense; the loss on early redemption of debt; and, the de-recognition of potential interest and penalties associated with certain state tax settlements.

		For the Year Ended November 30
		2006				2007				2008				2009				2010
		(in thousands, except per share data)
Net income		$	116,804			$	86,201			$	134,595			$	6,815			$	54,531
Net loss from discontinued operations			176				90				163				170				47
Income from continuing operations			116,980				86,291				134,758				6,985				54,578
Equity in net loss (income) from equity investments, net of tax			3,236				56,965				(970	)			79,277				1,155
Consolidated income from continuing operations excluding equity in net loss (income) from equity investments			120,216				143,256				133,788				86,262				55,733
Adjustments, net of tax:
Additional depreciation			—				9,009				1,278				637				—
Impairment of long-lived assets			55,441				8,390				1,374				10,081				5,373
Correction of certain other assets’ carrying value			—				—				3,758				—				—
Interest rate swap expense			—				—				—				2,608				14,473
Loss on early redemption of debt			—				—				—				—				3,963
Provision on advances to Kansas Entertainment			—				—				1,409				—				—
IRS and state tax settlements			—				—				—				(8,923	)			(6,338	)
Tax benefit associated with restructuring initiatives			—				—				(3,477	)			—				—
Non-GAAP net income		$	175,657			$	160,655			$	138,130			$	90,665			$	73,204
Diluted earnings per share		$	2.19			$	1.64			$	2.71			$	0.14			$	1.13
Net loss from discontinued operations			0.01				—				—				—				—
Diluted earnings per share from continuing operations			2.20				1.64				2.71				0.14				1.13
Equity in net loss (income) from equity investments, net of tax			0.06				1.08				(0.02	)			1.63				0.03
Consolidated income from continuing operations excluding equity in net loss (income) from equity investments			2.26				2.72				2.69				1.77				1.16
Adjustments, net of tax:
Additional depreciation			—				0.17				0.02				0.01				—
Impairment of long-lived assets			1.04				0.16				0.03				0.21				0.11
Correction of certain other assets’ carrying value			—				—				0.08				—				—
Interest rate swap expense			—				—				—				0.05				0.30
Loss on early redemption of debt			—				—				—				—				0.08
Provision on advances to Kansas Entertainment			—				—				0.03				—				—
IRS and state tax settlements			—				—				—				(0.18	)			(0.13	)
Tax benefit associated with restructuring initiatives			—				—				(0.07	)			—				—
Non-GAAP diluted earnings per share		$	3.30			$	3.05			$	2.78			$	1.86			$	1.52

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

Results of Operations

General

The general nature of our business is a motorsports themed amusement enterprise, furnishing amusement to the public in the form of motorsports themed entertainment. We derive revenues primarily from (i) admissions to motorsports events and motorsports themed amusement activities held at our facilities, (ii) revenue generated in conjunction with or as a result of motorsports events and motorsports themed amusement activities conducted at our facilities, and (iii) catering, concession and merchandising services during or as a result of these events and amusement activities.

“Admissions, net” revenue includes ticket sales for all of our racing events and other motorsports activities and amusements, net of any applicable taxes.

“Motorsports related” revenue primarily includes television and ancillary media rights fees, promotion and sponsorship fees, hospitality rentals (including luxury suites, chalets and the hospitality portion of club seating), advertising revenues, royalties from licenses of our trademarks, parking and camping revenues, and track rental fees.

“Food, beverage and merchandise” revenue includes revenues from concession stands, direct sales of souvenirs, hospitality catering, programs and other merchandise and fees paid by third party vendors for the right to occupy space to sell souvenirs and concessions at our motorsports entertainment facilities.

Direct expenses include (i) prize and point fund monies and NASCAR sanction fees, (ii) motorsports related expenses, which include labor, advertising, costs of competition paid to sanctioning bodies other than NASCAR and other expenses associated with the promotion of all of our motorsports events and activities, and (iii) food, beverage and merchandise expenses, consisting primarily of labor and costs of goods sold.

At the beginning of fiscal 2009, entitlement for the NASCAR Craftsman Truck series had changed and became the NASCAR Camping World Truck Series. Throughout this document, the naming convention for these series is consistent with the current branding.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, 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. While our estimates and assumptions are based on conditions existing at and trends leading up to the time the estimates and assumptions are made, actual results could differ materially from those estimates and assumptions. We continually review our accounting policies, how they are applied and how they are reported and disclosed in the financial statements.

The following is a summary of our critical accounting policies and estimates and how they are applied in the preparation of the financial statements.

Basis of Presentation and Consolidation. We consolidate all entities we control by ownership of a majority voting interest and variable interest entities for which we have the power to direct activities and the obligation to absorb losses. Our judgment in determining if we consolidate a variable interest entity includes assessing which party, if any, has the power and benefits. Therefore, we evaluate which activities most significantly affect the variable interest entities economic performance and determine whether we, or another party, have the power to direct these activities.

We apply the equity method of accounting for our investments in joint ventures and other investees whenever we can exert significant influence on the investee but do not have effective control over the investee. Our consolidated net income includes our share of the net earnings or losses from these investees. Our judgment regarding the level of influence over each equity method investee includes considering factors such as our ownership interest, board representation and policy making decisions. We periodically evaluate these equity investments for potential impairment where a decline in value is determined to be other than temporary. We eliminate all significant intercompany transactions from financial results.

Revenue Recognition. Advance ticket sales and event-related revenues for future events are deferred until earned, which is generally once the events are conducted. The recognition of event-related expenses is matched with the recognition of event-related revenues.

NASCAR contracts directly with certain network providers for television rights to the entire NASCAR Sprint Cup and Nationwide series schedules as well as the NASCAR Camping World Truck series schedule beginning in fiscal year 2007. Event promoters share in the television rights fees in accordance with the provision of the sanction agreement for each NASCAR Sprint Cup, Nationwide and Camping World Truck series event. Under the terms of this arrangement, NASCAR retains 10.0 percent of the gross broadcast rights fees allocated to each NASCAR Sprint Cup, Nationwide and Camping World Truck series event as a component of its sanction fees. The promoter records 90.0 percent of the gross broadcast rights fees as revenue and then records 25.0 percent of the gross broadcast rights fees as part of its awards to the competitors. Ultimately, the promoter retains 65.0 percent of the net cash proceeds from the gross broadcast rights fees allocated to the event.

Our revenues from marketing partnerships are paid in accordance with negotiated contracts, with the identities of partners and the terms of sponsorship changing from time to time. Some of our marketing partnership agreements are for multiple facilities and/or events and include multiple specified elements, such as tickets, hospitality chalets, suites, display space and signage for each included event. The allocation of such marketing partnership revenues between the multiple elements, events and facilities is based on relative fair value. The sponsorship revenue allocated to an event is recognized when the event is conducted.

Revenues and related costs from the sale of merchandise to retail customers, internet sales and direct sales to dealers are recognized at the time of sale.

Business Combinations. All business combinations are accounted for under the acquisition method. Whether net assets or common stock is acquired, fair values are determined and assigned to the purchased assets and assumed liabilities of the acquired entity. The excess of the cost of the acquisition over fair value of the net assets acquired (including recognized intangibles) is recorded as goodwill. Business combinations involving existing motorsports entertainment facilities commonly result in a significant portion of the purchase price being allocated to the fair value of the contract-based intangible asset associated with long-term relationships manifest in the sanction agreements with sanctioning bodies, such as NASCAR, Grand American and IndyCar. The continuity of sanction agreements with these bodies has historically enabled the facility operator to host motorsports events year after year. While individual sanction agreements may be of terms as short as one year, a significant portion of the purchase price in excess of the fair value of acquired tangible assets is commonly paid to acquire anticipated future cash flows from events promoted pursuant to these agreements which are expected to continue for the foreseeable future and therefore, in accordance with ASC 805-50, “Business Combinations,” are recorded as indefinite-lived intangible assets recognized apart from goodwill.

Capitalization and Depreciation Policies. Property and equipment are stated at cost. Maintenance and repairs that neither materially add to the value of the property nor appreciably prolong its life are charged to expense as incurred. Depreciation and amortization for financial statement purposes are provided on a straight-line basis over the estimated useful lives of the assets. When we construct assets, we capitalize costs of the project, including, but not limited to, certain pre-acquisition costs, permitting costs, fees paid to architects and contractors, certain costs of our design and construction subsidiary, property taxes and interest.

We must make estimates and assumptions when accounting for capital expenditures. Whether an expenditure is considered an operating expense or a capital asset is a matter of judgment. When constructing or purchasing assets, we must determine whether existing assets are being replaced or otherwise impaired, which also is a matter of judgment. Our depreciation expense for financial statement purposes is highly dependent on the assumptions we make about our assets’ estimated useful lives. We determine the estimated useful lives based upon our experience with similar assets, industry, legal and regulatory factors, and our expectations of the usage of the asset. Whenever events or circumstances occur which change the estimated useful life of an asset, we account for the change prospectively.

Interest costs associated with major development and construction projects are capitalized as part of the cost of the project. Interest is typically capitalized on amounts expended using the weighted-average cost of our outstanding borrowings, since we typically do not borrow funds directly related to a development or construction project. We capitalize interest on a project when development or construction activities begin, and cease when such activities are substantially complete or are suspended for more than a brief period.

Impairment of Long-lived Assets, Goodwill and Other Intangible Assets. Our consolidated balance sheets include significant amounts of long-lived assets, goodwill and other intangible assets which could be subject to impairment.

	•		In fiscal 2009, we recorded a non-cash charge of approximately $16.7 million as an impairment of long-lived assets primarily attributable to the reduction of the carrying value of our Staten Island property and impairment charges relating to certain other long-lived assets.
	•		In fiscal 2010 we determined that certain costs related to the Daytona Development Project which were capitalized are no longer expected to benefit the future development of the project. Accordingly, we recognized a non-cash impairment totaling approximately $5.8 million, consisting primarily of architecture and engineering, legal and associated capitalized interest. The costs which continue to be capitalized on this project consist principally of land and land related improvements which are expected to provide benefits to the ongoing development.

As of November 30, 2010, goodwill and other intangible assets and property and equipment accounts for approximately $1,674.2 million, or 89.1 percent of our total assets. We account for our goodwill and other intangible assets in accordance with ASC 350 and for our long-lived assets in accordance with ASC 360.

We follow applicable authoritative guidance on accounting for goodwill and other intangible assets which specifies, among other things, non-amortization of goodwill and other intangible assets with indefinite useful lives and requires testing for possible impairment, either upon the occurrence of an impairment indicator or at least annually. We complete our annual testing in our fiscal fourth quarter, based on assumptions regarding our future business outlook and expected future discounted cash flows attributable to such assets (using the fair value assessment provision of applicable authoritative guidance), supported by quoted market prices or comparable transactions where available or applicable.

In connection with our fiscal 2010 assessment of goodwill and intangible assets for possible impairment we used the methodology described above. We believe our methods used to determine fair value and evaluate possible impairment were appropriate, relevant, and represent methods customarily available and used for such purposes. Our latest annual assessment of goodwill and other intangible assets in the fourth quarter of fiscal 2010 indicated there had been no impairment and the fair value substantially exceeded the carrying value for the respective reporting units, except for one reporting unit that was recently acquired. The estimated fair value for this one reporting unit, which has goodwill of less than $20.0 million, exceeded the carrying value by less than 5 percent as determined using our internal discounted cash flow methodology. We believe recent comparable market transactions would support a substantially higher valuation. While we continue to review and analyze many factors that can impact our business prospects in the future (as further described in “Risk Factors”), our analysis is subjective and is based on conditions existing at, and trends leading up to, the time the estimates and assumptions are made. Different conditions or assumptions, or changes in cash flows or profitability, if significant, could have a material adverse effect on the outcome of the impairment evaluation and our future condition or results of operations. Despite the current adverse economic trends, particularly credit availability, the decline in consumer confidence and the rise in unemployment, which have recently contributed to the decrease in attendance related as well as corporate partner revenues for certain of our motorsports events during fiscal 2010, we believe there has been no significant change in the long-term fundamentals of our ongoing motorsports event business. We believe our present operational and cash flow outlook further support its conclusion.

In addition, our growth strategy includes investing in certain joint venture opportunities. In these equity investments we exert significant influence on the investee but do not have effective control over the investee, which adds an additional element of risk that can adversely impact our financial position and results of operations. The carrying value of our equity investments was $43.7 million at November 30, 2010.

Income Taxes. The tax law requires that certain items be included in our tax return at different times than when these items are reflected in our consolidated financial statements. Some of these differences are permanent, such as expenses not deductible on our tax return. However, some differences reverse over time, such as depreciation expense, and these temporary differences create deferred tax assets and liabilities. Our estimates of deferred income taxes and the significant items giving rise to deferred tax assets and

liabilities reflect our assessment of actual future taxes to be paid on items reflected in our financial statements, giving consideration to both timing and probability of realization. Actual income taxes could vary significantly from these estimates due to future changes in income tax law or changes or adjustments resulting from final review of our tax returns by taxing authorities, which could also adversely impact our cash flow.

In the ordinary course of business, there are many transactions and calculations where the ultimate tax outcome is uncertain. Accruals for uncertain tax positions are provided for in accordance with the requirements of ASC 740, “Income Taxes.” Under this guidance, we may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50.0 percent likelihood of being realized upon the ultimate settlement. This interpretation also provides guidance on de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures. Judgment is required in assessing the future tax consequences of events that have been recognized in our financial statements or tax returns. Although we believe the estimates are reasonable, no assurance can be given that the final outcome of these matters will not be different than what is reflected in the historical income tax provisions and accruals. Such differences could have a material impact on the income tax provision and operating results in the period in which such determination is made.

Derivative Instruments. From time to time, we utilize derivative instruments in the form of interest rate swaps and locks to assist in managing our interest rate risk. We do not enter into any interest rate swap or lock derivative instruments for trading purposes. We account for the interest rate swaps and locks in accordance with ASC 815, “Derivatives and Hedging.”

Contingent Liabilities. Our determination of the treatment of contingent liabilities in the financial statements is based on our view of the expected outcome of the applicable contingency. In the ordinary course of business, we consult with legal counsel on matters related to litigation and other experts both within and outside our Company. We accrue a liability if the likelihood of an adverse outcome is probable and the amount of loss is reasonably estimable. We disclose the matter but do not accrue a liability if the likelihood of an adverse outcome is reasonably possible and an estimate of loss is not determinable. Legal and other costs incurred in conjunction with loss contingencies are expensed as incurred.

Equity and Other Investments

Hollywood Casino at Kansas Speedway

On December 1, 2009, Kansas Entertainment, LLC, (“Kansas Entertainment”) a 50/50 joint venture of Penn Hollywood Kansas, Inc. (“Penn”), a subsidiary of Penn National Gaming, Inc. and Kansas Speedway Development Corporation (“KSDC”), a wholly owned subsidiary of ISC, was selected by the Kansas Lottery Gaming Facility Review Board to develop and operate a gaming facility in the Northeast Zone (Wyandotte County, Kansas). On February 12, 2010, Kansas Entertainment received the final approval under the Kansas Expanded Lottery Act, along with its gaming license from the Kansas Racing and Gaming Commission. Construction of the Hollywood-themed and branded entertainment destination facility, overlooking turn two of Kansas Speedway, began in April 2010 with a planned opening in the first half of 2012.

The initial phase of this project, including certain changes to the scope and mix of gaming operations and amenities approved by the Kansas Lottery Commission in August 2010, features an 82,000 square foot casino with 2,000 slot machines and 52 table games (including 12 poker tables), a 1,253 space parking structure as well as a sports-themed bar, dining and entertainment options. Kansas Entertainment anticipates funding the initial phase of the development with a mix of equity contributions from each partner as well third party financing, which it is currently pursuing. KSDC and Penn will share equally in the cost of developing and constructing the facility. We currently estimate that our share of capitalized development costs for the project, excluding our contribution of the land, will be approximately $155.0 million. In addition, we expect to continue to incur certain other start up and related costs through opening, a number of which will be expensed through equity in net loss from equity investments. Penn is the managing member of Kansas Entertainment and will be responsible for the development and operation of the casino and hotel.

We have accounted for Kansas Entertainment as an equity investment in our financial statements as of November 30, 2010 and our 50.0 percent portion of Kansas Entertainment’s net loss in fiscal 2010 is approximately $1.9 million, related to certain start up costs, and is included in equity in net loss from equity investments in our consolidated statements of operations. There were no operations included in our consolidated statements of operations in the same periods in fiscal 2009 or 2008.

Staten Island Property

In connection with our efforts to develop a major motorsports entertainment facility in the New York metropolitan area, our wholly owned indirect subsidiary, 380 Development, purchased a total of 676 acres located in the New York City borough of Staten Island in early fiscal 2005 and began improvements including fill operations on the property. In December 2006, we announced our decision to discontinue pursuit of the speedway development on Staten Island. In May 2007, we entered into a Consent Order with the New York Department of Environmental Conservation (“DEC”) to resolve certain issues surrounding the fill operations and the prior placement of fill at the site that contained constituents above regulatory thresholds. The Consent Order required us to remove non-compliant fill pursuant to an approved comprehensive fill removal plan, and to pay a penalty to DEC of $562,500, half of which was paid in May 2007 and the other half of which was suspended so long as we complied with the terms of the Consent Order. During the second quarter of fiscal 2009 the DEC notified us that it had complied with the terms of the Consent Order and that we had no further obligations under the Consent Order.

During the third quarter of fiscal 2009, we determined, based on our understanding of the real estate market and the above transaction, that the current carrying value of the property was in excess of the fair market value. As a result, we recognized a non-cash, pre-tax charge in our results of approximately $13.0 million, or $0.16 per diluted share, which is included in the Motorsports Event segment.

In October 2009, we announced that we had entered into a definitive agreement (“Agreement”) with KB Marine Holdings LLC (“KB Holdings”) under which KB Holdings would acquire 100 percent of the outstanding equity membership interests of 380 Development for a total purchase price of $80.0 million. Upon execution of the Agreement, ISC received a non-refundable $1.0 million payment. This transaction was scheduled to close by February 25, 2010. However, the closing was subject to certain conditions including KB Holdings securing the required equity commitments to acquire the property and performing its obligation under the Agreement. KB Holdings did not obtain resolution of certain issues relating to the fill permitting process which prevented it from obtaining funding and closing the Agreement.

On September 2, 2010, we executed a second amendment to the Agreement which provided an extension to KB Holdings to close the transaction on or before November 30, 2010. Under the terms of that extension, the purchase price to be paid by KB Holdings was $88.0 million, $33.6 million of which, in non-refundable deposits and cash, was to be received at or prior to closing, and $54.4 million of which will be in the form of a promissory note payable on or before August 31, 2011. The promissory note would have had a market-based interest rate and was to be secured by a first priority security interest in the outstanding equity membership interests of 380 Development. We expected that the proceeds from the sale, net of applicable broker commissions and other closing costs would result in an immaterial gain or loss on the transaction upon closing.

On December 6, 2010, we announced the termination of the Agreement with KB Holdings for the sale of the Staten Island, New York property. KB Holdings did not fulfill the terms of the second amendment to the Agreement to close the transaction on or before November 30, 2010. As a result of the transaction terminating, we are pursuing discussions with alternative buyers for the 676-acre parcel of property located in Staten Island.

Motorsports Authentics

We are partners with Speedway Motorsports, Inc. in a 50/50 joint venture, SMISC, LLC, which, through its wholly owned subsidiary Motorsports Authentics, LLC conducts business under the name Motorsports Authentics. MA designs, promotes, markets and distributes motorsports licensed merchandise.

In fiscal 2009, MA management and ownership considered various approaches to optimize performance in MA’s various distribution channels. As the challenges were assessed, it became apparent that there was significant risk in future business initiatives in mass apparel, memorabilia and other yet to be developed products. These initiatives had previously been deemed achievable and were included in projections that supported the carrying value of inventory, goodwill and other intangible assets on MA’s balance sheet. This analysis, combined with a long-term macroeconomic outlook that was less robust than previously expected, triggered MA’s review of certain assets under ASC 350 and ASC 360 and our evaluation under ASC 320-10.

In the fiscal third quarter 2009, MA, suffering financial stress from the recession, ceased paying certain guaranteed royalties under several license agreements where estimated royalties payable based on projected sales were less than stipulated guaranteed minimum royalties payable (“unearned royalties”). All earned royalties that were due have been paid. MA had received notices from certain licensors alleging default under the license agreements should MA not pay unearned royalties within stipulated cure periods.

As a result of the foregoing which triggered the our evaluation performed under ASC 320-10 we recognized significant impairments of our equity investment in MA during the second and fourth quarters of fiscal 2009, resulting in a reduction to the carrying value of our investment in MA to zero at November 30, 2009. MA’s management, with the assistance of an independent appraisal firm, completed its review in the fourth quarter of fiscal 2009, concluding that the fair value of MA’s goodwill and intangible assets should be reduced to zero.

Going into fiscal 2010, MA management and ownership continued to explore business strategies in conjunction with certain motorsports industry stakeholders that allow the possibility for MA to operate profitably in the future. As with any business in an adverse economic environment, management must find the optimal business model for long-term viability. In addition to revisiting the business vision for MA, management, with support of ownership, has undertaken certain initiatives to improve inventory controls and buying cycles, as well as implemented changes to make MA a more efficiently operated and profitable company. We believe a revised MA business vision, which includes the successful resolution of license agreement terms and favorable license terms in the future, along with a focus on its core competencies, streamlined operations, reduced operating costs and inventory risk, are necessary for MA to survive as a profitable operation in the future.

In July 2010, certain industry stakeholders created the NASCAR Licensing Trust (“Trust”) that is represented by a Board of Directors that includes representatives from NASCAR, the sanctioning body, and from NASCAR Teams. Under this new agreement, the Trust brings a new structure to the licensing business that will be more efficient for the industry. The benefit to the licensees is a more focused and streamlined licensing business that will reduce cost, foster more efficient administrative processes, and allow for more cohesive retail and marketing strategies.

The Trust represents four key categories — die-cast, toys, apparel and trackside retail rights — and grants the rights of any NASCAR driver that is participating in the licensing categories included in the Trust. The revenues will be distributed based on percentage of licensed sales and allocated according to actual earnings to each licensor. This should allow the industry to more efficiently manage costs and increase revenues, while providing a wider selection of products for fans.

Concurrent with the creation of the Trust, MA management, ownership and industry stakeholders negotiated MA’s release from future guaranteed minimum royalties as well as the current unearned guaranteed minimum royalties payable to NASCAR team licensors. With respect to the one agreement secured by parent company guarantees, MA and the parent companies negotiated a settlement amount to eliminate future guaranteed minimum royalties.

As a result of the settlement, our remaining guaranty exposure, to one NASCAR team licensor, has been reduced to approximately $5.0 million and will be satisfied upon MA making certain payments to the team through January 2013. In January 2011, MA made a payment to the team effectively reducing our guaranty exposure to $3.8 million. While it is possible that some obligation under this guarantee may occur in the future, the amount we will ultimately pay cannot be estimated at this time. In any event, we do not believe that the ultimate financial outcome will have a material impact on our financial position or results of operations.

We did not recognize any net income or loss from operations of MA during fiscal 2010. Our 50.0 percent portion of MA’s fiscal 2009 net loss is approximately $77.6 million, or $1.63 per diluted share, which included the aforementioned impairment charges. Fiscal 2008 equity in net income from MA was approximately $1.6 million, or $0.02 per diluted share.

Other Equity Investments

Our equity investments also include our 50.0 percent limited partnership investment in Stock-Car Montreal L.P. prior to the acquisition of the remaining interest in February 2009.

Income Taxes

The tax treatment of providing a valuation allowance related to losses incurred by our Motorsports Authentics equity investment, partially offset by the reduction in income taxes due to the interest income related to our settlement with the Internal Revenue Service, are the principal causes of the increased effective income tax rate for the fiscal year ended November 30, 2009. The de-recognition of potential interest and penalties associated with certain state settlements as well as certain state credits accrued are the principal causes of the decreased effective income tax rate for the fiscal year ended November 30, 2010.

As a result of the above items, our effective income tax rate increased from the statutory income rate to approximately 85.5 percent for the fiscal year ended November 30, 2009, and decreased from the statutory income rate to approximately 27.0 percent for the fiscal year ended November 30, 2010.

Current Litigation

From time to time, we are a party to routine litigation incidental to our business. We do not believe that the resolution of any or all of such litigation will have a material adverse effect on our financial condition or results of operations.

Future Trends in Operating Results

Economic conditions, including those affecting disposable consumer income and corporate budgets such as employment, business conditions, credit availability, interest rates and taxation rates, may impact our ability to sell tickets to our events and to secure revenues from corporate marketing partnerships. We believe that adverse economic trends, particularly the rise in unemployment and the decline in the consumer confidence index significantly contributed to the decrease in attendance for certain of our motorsports entertainment events during fiscal 2009. Certain of these trends have persisted through fiscal 2010 and are not expected to materially change in 2011, which may have an impact on our business, especially attendance-related and corporate partner revenues. In response, we recently announced an initiative to lower our direct operating expenses, beginning in 2011, by $20.0 million to $30.0 million in sustainable reductions through the streamlining of corporate services, optimization of event and ancillary business models, and process improvements that resulted in a reduction of workforce and operational costs. These changes are expected to have a positive impact on our financial position.

Admissions

An important component of our operating strategy has been our long-standing practice of focusing closely on supply and demand when evaluating ticket pricing and adjusting capacity at our facilities. By effectively managing ticket prices and seating capacity, we can stimulate ticket renewals and advance sales. Advance ticket sales result in earlier cash flow and reduce the potential negative impact of actual and forecasted inclement weather on ticket sales. With any ticketing program, we first examine our pricing structure to ensure that prices are in line with market demand. When determined necessary, as has been the case during this period of sustained economic downturn, we will adjust pricing on inventory.

While we have not had a sell-out at any of our events since February 2008, we have had capacity crowds at certain events. We have also experienced a compressed sales cycle with our customers making their ticket purchasing decisions closer to the event date. To address this and to be sensitive to the economic challenges that many of our fans face, in 2009, we lowered prices on over 150,000 seats, or 15.0 percent of our grandstand capacity, for NASCAR Sprint Cup events across the Company. For our 2010 events, we expanded our reduced pricing to approximately 500,000 seats throughout our facilities as well as unbundling a substantial number of tickets to better respond to consumer demand. In addition to preferred pricing, we provided our customers that renew early various incentives as well as special access privileges. We also created ticket packages that provide added value opportunities, making it more affordable for our fans to attend live events. As we also want to develop the next generation motorsports fan, we expanded our youth initiative to encourage families to attend.

We believe, based on our research and analysis, our current pricing levels and initiatives going into the 2011 season are on target with demand, providing appropriate price points for all income levels. Also, based on consumer feedback, we will now provide single-day ticket purchasing at Kansas and Chicagoland Speedways for all of their events. These facilities previously required purchasers to purchase season-ticket packages for certain sanctioned racing events annually, under specified terms and conditions.

It is important that we maintain the integrity of our pricing model by rewarding our best and loyal customers. We do not adjust pricing inside of the sales cycle and avoid rewarding last-minute ticket buyers by discounting tickets. Further, we limit and monitor the availability of promotional tickets. All of these factors could have a detrimental effect on our pricing model and long-term value of our business. We believe it is more important to encourage advance ticket sales and maintain price integrity to achieve long-term growth than to capture short-term incremental revenue.

Corporate Partnerships

With regard to corporate marketing partner relationships, we believe that our presence in key markets, impressive portfolio of events and attractive fan demographics are beneficial and help to mitigate adverse economic trends as we continue to pursue renewal and expansion of existing marketing partnerships and establish new corporate relationships.

Due to the current economic conditions which began to deteriorate in the latter part of fiscal 2008, extended throughout fiscal 2009 and persisted in fiscal 2010, we have experienced a slowdown in corporate spending. In addition, the process of securing sponsorship deals has become more time consuming as corporations are more closely scrutinizing their marketing budgets. While these trends continue to impact sales, we are seeing encouraging signs of interest from corporate partners. We expect, based on current interest and demand, to secure all of our 2011 NASCAR Sprint Cup and Nationwide series event entitlements. We continue to believe that revenues from our corporate marketing relationships will grow over the long term, contributing to strong earnings and cash flow stability and predictability.

Television Broadcast and Ancillary Media Rights

Domestic broadcast and ancillary media rights fees revenues are an important component of our revenue and earnings stream. Starting in 2007, NASCAR entered into new combined eight-year agreements with FOX, ABC/ESPN, TNT and SPEED for the domestic broadcast and related rights for its three national touring series — Sprint Cup, Nationwide and Camping World Truck. The agreements total approximately $4.5 billion over the eight-year period from 2007 through 2014. This results in an approximate $560.0 million gross average annual rights fee for the industry, a more than 40.0 percent increase over the previous contract average of $400.0 million annually. The industry rights fees were approximately $545.0 million for 2010 and will be approximately $565.0 million for 2011. The industry rights fees will increase, on average, by approximately three percent per year through the 2014 season. The annual increase is expected to vary between two and four percent per year over the period.

FOX and TNT have been strong supporters of NASCAR racing since 2001, and both have played a major role in the sport’s climb in popularity. We have, and expect to continue to see, ongoing broadcast innovation in their coverage of NASCAR racing events. Also notable was the return of ESPN to the sport in 2007, which it helped build throughout the 1980s and 1990s. ESPN’s coverage and weekly ancillary NASCAR-related programming continues to promote the sport across various properties. Further, ESPN broadcasts substantially all of the NASCAR Nationwide Series, providing that series with the continuity and promotional support that we believe will allow it to flourish. We were pleased with ABC’s decision to broadcast the majority of its 2010 NASCAR Sprint Cup series events on its cable channel, ESPN. ESPN has a subscriber base at approximately 100 million, while less than the networks, it does have, over the longer term, the ability to attract younger viewers as well as create more exposure for the sport. Also, cable broadcasters can support a higher investment through subscriber fees not available to traditional networks, which is a potential benefit when NASCAR negotiates the next consolidated domestic broadcast and ancillary media rights contract.

While the media landscape continues to evolve, we continue to believe NASCAR’s position in the sports and entertainment landscape remains strong. It is expected that ratings will fluctuate year to year. For the 2010 NASCAR season, television ratings for the NASCAR Sprint Cup series decreased to an average of 4.1 million households and 5.9 million viewers as reported by the Nielsen Company. However, the long-term ratings health of NASCAR Sprint Cup series events remains robust as it remains the second highest-rated regular season sport on television and is the number two sport among all key demographic groups, trailing only the NFL. In addition, the NASCAR Nationwide series is the second-highest rated motorsports series on television and the NASCAR Camping World Truck series is the third-highest rated motorsports series on cable television.

These long-term contracts provide significant cash flow visibility to us, race teams and NASCAR over the contract term. Television broadcast and ancillary rights fees from continuing operations received from NASCAR for the NASCAR Sprint Cup, Nationwide and Camping World Truck series events conducted at our wholly owned facilities under these agreements, and recorded as part of motorsports related revenue, were approximately $257.0 million, $262.0 million and $269.1 million for fiscal 2008, 2009 and 2010,

respectively. Operating income generated by these media rights were approximately $189.4 million, $192.1 million and $197.5 million for fiscal 2008, 2009 and 2010, respectively.

As media rights revenues fluctuate so do the variable costs tied to the percentage of broadcast rights fees required to be paid to competitors as part of NASCAR Sprint Cup, Nationwide and Camping World Truck series sanction agreements. NASCAR prize and point fund monies, as well as sanction fees (“NASCAR direct expenses”), are outlined in the sanction agreement for each event and are negotiated in advance of an event. As previously discussed, included in these NASCAR direct expenses are amounts equal to 25.0 percent of the gross domestic television broadcast rights fees allocated to our NASCAR Sprint Cup, Nationwide and Camping World Truck series events, as part of prize and point fund money (See “Critical Accounting Policies and Estimates — Revenue Recognition”). These annually negotiated contractual amounts paid to NASCAR contribute to the support and growth of the sport of NASCAR stock car racing through payments to the teams and sanction fees paid to NASCAR. As such, we do not expect these costs to materially decrease in the future as a percentage of admissions and motorsports related income. We anticipate any operating margin improvement to come primarily from economies of scale and controlling costs.

Sanctioning Bodies

Our success has been, and is expected to remain, dependent on maintaining good working relationships with the organizations that sanction events at our facilities, particularly with NASCAR, whose sanctioned events at our wholly owned facilities accounted for approximately 89.8 percent of our revenues in fiscal 2010. NASCAR continues to entertain and discuss proposals from track operators regarding potential realignment of NASCAR Sprint Cup Series dates to more geographically diverse and potentially more desirable markets where there may be greater demand, resulting in an opportunity for increased revenues to the track operators. NASCAR has recently approved our request for realignment and beginning in 2011, Kansas Speedway (“Kansas”) will now host two NASCAR Sprint Cup Series weekends. We believe that these realignments have provided, and will continue to provide, incremental net positive revenue and earnings as well as further enhance the sport’s exposure in highly desirable markets, which we believe benefits the sport’s fans, teams, sponsors and television broadcast partners as well as promoters.

Capital Improvements

Since we compete with newer entertainment venues for patrons and sponsors, we will continue to evaluate opportunities to enhance our facilities, thereby producing additional revenue opportunities and improving the event experience for our guests. Major examples of these efforts include:

     Fiscal 2008

	•		We installed track lighting at Chicagoland as well as improved certain electrical infrastructure in certain camping areas. In addition to enhancing the guest experience, we now have the flexibility to run events later in the day in the event of inclement weather;
	•		We repaved Darlington Raceway (“Darlington”) and constructed a tunnel in Turn 3 that provides improved access for fans and allows emergency vehicles to easily enter and exit the infield area of the track. These collective projects mark the largest one-time investment in the 50-year history of the storied South Carolina facility;
	•		We enhanced seating at Michigan International Speedway (“Michigan”) to provide wider seats, seatbacks and more leg room for fans. We also added incremental camping capacity and new shower/restroom facilities for our on-site overnight guests, as well as installed a state-of-the-art 110-foot, three-sided LED scoreboard for fans to more easily follow the on-track competition. Finally, we added additional branded way-finding signage to help pedestrians, motorists and campers find their way in, out and around the 1,400-acre racetrack property; and
	•		We constructed new media centers at Watkins Glen International (“Watkins Glen”) and Homestead-Miami Speedway (“Homestead”), which we believe increased appeal to media content providers, sports journalists, racing team owners and drivers and others involved in the motorsports industry.

     Fiscal 2009

	•		We constructed a new media center at Michigan as part of the terrace suite redevelopment project which we believe has increased appeal to media content providers, sports journalists, racing team owners and drivers and others involved in the motorsports industry;
	•		To further enhance our guest experience, we reconfigured tram and pedestrian routes at Richmond International Raceway (“Richmond”); built a new tram stop at Daytona International Speedway (“Daytona”); and, replaced the seats in the lower grandstands at Talladega Superspeedway (“Talladega”); and
	•		We have constructed a new leader board at Homestead, which is the prototype for future tracks.

     Fiscal 2010

	•		We made further grandstand enhancements at Michigan to provide wider seats, seatbacks and more leg room for fans;
	•		We completed our repaving project at Daytona. In addition, we made frontstretch fan improvements and superstretch hospitality improvements at Daytona which included the addition of the Superstretch Fan Zone and improved tram infrastructure, and we constructed a new 1/4 mile Flat Track facility which hosted successful AMA motorcycle events;
	•		We completed a major seat enhancement project at Talladega by installing new wider stadium style seats and increased leg room; and
	•		We have constructed a new state of the art LED leader board and video screens at Richmond.

We anticipate modest capital spending on other projects for maintenance, safety and regulatory requirements, as well as for preserving the guest experience at our events to enable us to effectively compete with other sports venues for consumer and corporate spending.

Growth Strategies

Our growth strategies also include exploring ways to grow our businesses through acquisitions and external developments that offer attractive financial returns. This has been demonstrated through the planned real estate development joint venture to develop and operate a Hollywood-themed and branded entertainment destination facility overlooking turn two of Kansas Speedway. (see “Kansas Hotel and Casino Development”).

Postponement and/or Cancellation of Major Motorsports Events

We promote outdoor motorsports entertainment events. Weather conditions affect sales of, among other things, tickets, food, drinks and merchandise at these events. Poor weather conditions prior to an event, or even the forecast of poor weather conditions, could have a negative impact on us, particularly for walk-up ticket sales to events which are not sold out in advance. If an event scheduled for one of our facilities is delayed or postponed because of weather or other reasons such as, for example, the general postponement of all major sporting events in the United States following the September 11, 2001 terrorism attacks, we could incur increased expenses associated with conducting the rescheduled event, as well as possible decreased revenues from tickets, food, drinks and merchandise at the rescheduled event. If such an event is cancelled, we would incur the expenses associated with preparing to conduct the event as well as losing the revenues, including any live broadcast revenues, associated with the event to the extent such losses were not covered by insurance.

Current Operations Comparison

The following table sets forth, for each of the indicated periods, certain selected statement of operations data as a percentage of total revenues:

		For the Year Ended November 30,
		2008				2009				2010
Revenues:
Admissions, net			30.0	%			28.2	%			24.9	%
Motorsports related			58.8				62.4				65.2
Food, beverage and merchandise			9.9				8.1				8.1
Other			1.3				1.3				1.8
Total revenues			100.0				100.0				100.0
Expenses:
Direct:
Prize and point fund monies and NASCAR sanction fees			19.6				23.5				24.4
Motorsports related			21.1				21.6				22.1
Food, beverage and merchandise			6.1				5.7				5.7
General and administrative			13.9				15.0				15.9
Depreciation and amortization			9.0				10.5				11.6
Impairment of long-lived assets			0.3				2.4				1.4
Total expenses			70.0				78.7				81.1
Operating income			30.0				21.3				18.9
Interest expense, net			(2.2	)			(2.6	)			(2.3	)
Interest rate swap expense			—				(0.6	)			(3.7	)
Loss on early redemption of debt			—				—				(1.0	)
Other income			—				0.1				—
Equity in net loss from equity investments			(0.2	)			(11.2	)			(0.3	)
Income from continuing operations before income taxes			27.6				7.0				11.6
Income taxes			10.5				6.0				3.1
Income from continuing operations			17.1				1.0				8.5
Loss from discontinued operations			—				—				—
Net income			17.1	%			1.0	%			8.5	%

Comparison of Fiscal 2010 to Fiscal 2009

The comparison of fiscal 2010 to fiscal 2009 is impacted by the following factors:

	•		Economic conditions, including those affecting disposable consumer income and corporate budgets such as employment, business conditions, interest rates and taxation rates, impact our ability to sell tickets to our events and to secure revenues from corporate marketing partnerships. We believe that unprecedented adverse economic trends, particularly the decline in consumer confidence and the rise in unemployment contributed to the decrease in attendance related as well as corporate partner revenues for certain of our motorsports entertainment events during fiscal 2010;
	•		An IndyCar series event held at Richmond and a NASCAR Camping World Truck series event held at Auto Club Speedway in fiscal 2009 were not held in fiscal 2010. Offsetting this was a NASCAR Camping World Truck series event held at Darlington in fiscal 2010 that was not held in fiscal 2009;
	•		In fiscal 2010, we recognized non-cash impairments of long-lived assets totaling approximately $8.9 million, or $0.11 per diluted share, primarily attributable to certain costs related to the Daytona Development Project which were capitalized that are no longer expected to benefit the future development of the project. In fiscal 2009, we recognized non-cash impairments of long-lived assets totaling approximately $16.7 million, or $0.21 per diluted share, primarily attributable to the aforementioned decrease in the carrying value of our Staten Island property and, to a much lesser extent, impairments of certain other long-lived assets;

	•		During fiscal 2010, we recognized approximately $23.9 million, or $0.30 per diluted share in expenses related to an interest rate swap. In fiscal 2009, we recognized approximately $4.3 million, or $0.05 per diluted share in similar expense (see “Future Liquidity”);
	•		During fiscal 2010, we recognized approximately $6.5 million in expenses, or $0.08 per diluted share related to a partial redemption of $150 million principal 5.4% Senior Notes maturing in 2014 (see “Future Liquidity — Long-Term Obligations and Commitments”);
	•		During fiscal 2009, we recorded certain charges related to our joint venture Motorsports Authentics (see Equity and Other Investments); and
	•		As a result of the previously discussed favorable settlements and on-going discussions with certain states, we de-recognized potential interest and penalties totaling approximately $6.3 million or $0.13 per diluted share in fiscal 2010. During fiscal 2009 we recognized interest income net of tax, of approximately $8.9 million, or $0.18 per diluted share, in our income tax expense as a result of our settlement with the Internal Revenue Service. This de-recognition of interest and penalties was recognized as a reduction in income tax expense in our consolidated statement of operations.

Admissions revenue decreased approximately $35.0 million, or 17.9 percent, in fiscal 2010 as compared to fiscal 2009. We believe the decrease was driven by lower attendance attributable to ongoing adverse economic conditions as well as inclement weather and a decrease in our weighted average ticket price for certain events associated with the previously discussed value pricing initiatives.

Motorsports related revenue decreased approximately $11.3 million, or 2.6 percent, in fiscal 2010 as compared to fiscal 2009. The decrease is substantially attributable to decreases in sponsorship, suite and hospitality revenues for certain events. To a lesser extent, contributing to change was the aforementioned Camping World Truck series event not being held at Auto Club Speedway, and the IndyCar event not being held at Richmond, respectively. Partially offsetting these decreases was an increase in television broadcast and ancillary rights.

Food, beverage and merchandise revenue decreased approximately $3.9 million, or 6.9 percent, in fiscal 2010 as compared to fiscal 2009. The decrease is substantially attributable to the previously discussed lower attendance.

Prize and point fund monies and NASCAR sanction fees decreased approximately $5.4 million, or 3.3 percent, in fiscal 2010 as compared to fiscal 2009. The decrease is primarily attributable to the reduction in overall prize and point fees paid for the events held in the period as compared to the same period in prior year. Partially offsetting overall decreases are the increases in television broadcast rights fees for the NASCAR Sprint Cup, Nationwide and Camping World Truck series events during the periods as standard NASCAR sanctioning agreements require a specific percentage of television broadcast rights fees to be paid to competitors. Partially offsetting the decrease was the aforementioned Camping World Truck series event held at Darlington that was not held in fiscal 2009.

Motorsports related expense decreased by approximately $7.2 million, or 4.8 percent, in fiscal 2010 as compared to fiscal 2009. The decrease is primarily attributable to reduced promotional, advertising and other race related expenses during the period as a result of focused cost containment. Contributing to the decrease was aforementioned IndyCar series event that was not held at Richmond in fiscal 2010 that was held in fiscal 2009. The decrease was partially offset by the aforementioned Camping World Truck series event held at Darlington added to the schedule in 2010. Motorsports related expenses as a percentage of combined admissions and motorsports related revenue increased slightly to approximately 24.5 percent for fiscal 2010, as compared to 23.9 percent for the same period in the prior year. The slight margin decrease is primarily due to the previously discussed lower admissions and motorsports related revenue during the period.

Food, beverage and merchandise expense decreased approximately $2.2 million, or 5.6 percent, in fiscal 2010 as compared to fiscal 2009. The decrease is primarily attributable to variable costs associated with the lower sales of merchandise and concessions, as well as catering. Food, beverage and merchandise expense as a percentage of food, beverage and merchandise revenue increased slightly to approximately 70.3 percent for fiscal 2010, as compared to 69.4 percent for the same period in the prior year. The slight margin decrease was primarily attributable to the ratio of fixed to variable costs.

General and administrative expense decreased approximately $1.0 million, or 1.0 percent, in fiscal 2010 as compared to fiscal 2009. We incurred approximately $2.3 million of costs related to organizational and structural changes in connection with the company-wide

initiative to reduce future operational costs. Offsetting this amount were ongoing cost containment initiatives that were put in place in fiscal 2009. General and administrative expenses as a percentage of total revenues increased to approximately 15.9 percent for fiscal 2010, as compared to 15.0 percent for fiscal 2009. The slight margin decrease is primarily due to the previously discussed decrease in revenues, largely offset by our cost containment efforts.

Depreciation and amortization expense increased approximately $1.6 million, or 2.1 percent, in fiscal 2010 as compared to fiscal 2009. The increase is predominately attributable to our headquarters building (see “Future Liquidity”) which was put in service in the last month of fiscal 2009. Partially offsetting the increases are certain assets which have reached the end of their useful lives.

The impairment of long-lived assets of approximately $8.9 million is primarily attributable to the aforementioned non-cash impairment of certain costs related to the Daytona Development Project and removal of certain other long-lived assets located at our motorsports facilities.

Interest income and other decreased by approximately $0.9 million during fiscal 2010 as compared to fiscal 2009. The decrease was attributable to lower interest rates as compared to the same periods in the prior year.

Interest expense decreased by approximately $4.0 million during fiscal 2010 as compared to fiscal 2009. The decrease is primarily due to the funding of the $150 million principal 4.2 percent Senior Notes maturity in April 2009 and the lower average outstanding balance on our credit facility as compared to the same period in the prior year. Partially offsetting the decrease is the interest on the term loan for our new headquarters building.

Interest rate swap expense increased by approximately $19.6 million during fiscal 2010 as compared to fiscal 2009. The increase is primarily attributable to the termination of the interest rate swap and the reduction of the anticipated debt issuance from $150.0 million to $65.0 million during the fiscal year ended November 30, 2010.

Loss on early redemption of debt of approximately $6.5 million in fiscal 2010 is attributable to the aforementioned partial redemption of the $150 million principal 5.4 percent Senior Notes maturing in 2014 (see “Future Liquidity — Long-Term Obligations and Commitments”) . There is no comparable amount in fiscal 2009.

Equity in net loss from equity investments represents our 50.0 percent equity investments in Motorsports Authentics and Hollywood Casino at Kansas Speedway (see “Equity and Other Investments”). The equity in net loss from equity investments of approximately $1.9 million in fiscal 2010 relates to certain start up costs related to the Hollywood Casino at Kansas Speedway. There were no comparable costs in fiscal 2009. We did not recognize any net loss from operations of Motorsports Authentics in fiscal 2010 as compared to an approximate net loss of $77.6 million in fiscal 2009.

Our effective income tax rate decreased from approximately 85.5 percent to approximately 27.0 percent during fiscal 2010 compared to fiscal 2009 (see “Income Taxes”).

As a result of the foregoing, net income increased approximately $47.7 million, or $0.99 per diluted share, for fiscal 2010 as compared to fiscal 2009.

Comparison of Fiscal 2009 to Fiscal 2008

The comparison of fiscal 2009 to fiscal 2008 is impacted by the following factors:

•

Economic conditions, including those affecting disposable consumer income and corporate budgets such as employment, business conditions, interest rates and taxation rates, impact our ability to sell tickets to our events and to secure revenues from corporate marketing partnerships. We believe that adverse economic trends, particularly credit availability, the decline in consumer confidence, and the rise in unemployment, began to manifest in early fiscal 2008 and have increasingly contributed to the decrease in attendance related as well as corporate partner revenues for certain of our motorsports entertainment events during fiscal 2009;

	•		Further impacting the comparability of the periods were strong consumer and corporate sales for the 50th running of the Daytona 500 in fiscal 2008. This monumental anniversary of the “Great American Race” provided significant unique opportunities to drive attendance and revenue above the otherwise strong appeal of this marquee event and the sport of NASCAR in general;
	•		On February 27, 2009, we acquired the 50.0 percent ownership interest in Stock-Car Montreal L.P. we did not previously own, bringing our ownership to 100.0 percent. This acquisition was accounted for as a business combination and the operations of Stock-Car Montreal L.P. are included in our consolidated operations subsequent to the date of acquisition. Prior to this date, we had accounted for their operations as part of equity in net loss from equity investments. A NASCAR Nationwide Series and a Grand American Series event were held at Stock-Car Montreal during the third quarter of fiscal 2009;
	•		Due to the acquisition of Grand American by NASCAR in October 2008, expenses related to prize, point and sanction fees are reported as part of prize and point fund monies and NASCAR sanction fees on the consolidated statement of operations for fiscal year 2009 while reported as part of motorsports related expense in fiscal 2008 and prior years;
	•		During fiscal 2009, approximately $1.0 million, or $0.01 per diluted share, of depreciation was accelerated above our normal depreciation rates relating to our prior office building in Daytona Beach, Florida which is expected to be razed as part of our Daytona Development Project (see further discussion in “Future Liquidity”). During fiscal 2008, depreciation was accelerated above our normal depreciation rates relating to this prior office building and certain other offices and buildings which were razed in fiscal 2008 as part of our Daytona Development Project totaling approximately $2.1 million, or $0.03 per diluted share. These amounts were calculated by taking the remaining net book values of the respective offices and buildings and systematically reducing the net book values over their remaining useful lives based on the last date of occupancy and/or the razing of the structure(s);
	•		In fiscal 2009, we recognized non-cash impairments of long-lived assets totaling approximately $16.7 million, or $0.21 per diluted share, primarily attributable to the aforementioned decrease in the carrying value of our Staten Island property and, to a much lesser extent, impairments of certain other long-lived assets. In fiscal 2008, we recognized impairments of long-lived assets totaling approximately $2.2 million, or $0.03 per diluted share, primarily attributable to our Staten Island property and impairments of certain other long-lived assets;
	•		During fiscal 2008, we recorded a non-cash charge totaling approximately $3.8 million, or $0.07 per diluted share, to correct the carrying value amount of certain other assets, for which there was no comparable amortization in the prior year. This adjustment was recorded in interest income and other in the consolidated statement of operations;
	•		During fiscal 2009, we recognized interest rate swap expense of approximately $4.3 million, or $0.05 per diluted share, related to our interest rate swap for which there was no comparable expense in the prior year (see “Future Liquidity”). This expense was recorded in interest rate swap expense in the consolidated statement of operations;
	•		In fiscal 2009, the $77.6 million, or $1.63 per diluted share, equity in net loss from equity investments represents our portion of the results from our 50.0 percent indirect interest in Motorsports Authentics and includes the previously discussed non-cash impairment charge of approximately $69.3 million, or $1.43 per diluted share (see “Equity and Other Investments”). Our portion of Motorsports Authentics net income for fiscal 2008 included in equity in net loss from equity investments was approximately $1.6 million, or $0.02 per diluted share; and
	•		During fiscal 2009 we recognized interest income net of tax, of approximately $8.9 million, or $0.18 per diluted share, in our income tax expense as a result of the settlement with the Internal Revenue Service.

Admissions revenue decreased approximately $40.6 million, or 17.2 percent, in fiscal 2009 as compared to fiscal 2008. We believe the decrease was primarily attributable to the decreases in attendance due to previously discussed adverse economic trends including decreases in weighted average ticket prices as a result of pricing strategies for our NASCAR Sprint Cup events in 2009 (see “Future Trends in Operating Results”). These decreases were further impacted by the strong demand for certain events conducted during Speedweeks at Daytona supporting the 50th running of the sold out Daytona 500 in fiscal 2008. The overall decrease in attendance was partially offset by the consolidation of the Nationwide series event weekend at Stock-Car Montreal and a slight increase in the weighted average ticket prices for certain events conducted during Speedweeks at Daytona in fiscal 2009.

Motorsports related revenue decreased approximately $30.6 million, or 6.6 percent, in fiscal 2009 as compared to fiscal 2008. The decrease was primarily due to the decreases in sponsorship, suite and hospitality revenues for certain events conducted during the year, which we believe result largely from the previously discussed adverse economic conditions. To a lesser extent, lower track rentals, advertising and ancillary rights revenues also contributed to the decrease. Partially offsetting the decrease was the Nationwide series event weekend at Stock-Car Montreal and an increase in television broadcast rights for our NASCAR Sprint Cup, Nationwide, and Camping World Truck series events.

Food, beverage and merchandise revenue decreased approximately $21.7 million, or 27.8 percent, in fiscal 2009 as compared to fiscal 2008. The decrease was primarily attributable to previously discussed adverse economic conditions impacting attendance as well as lower per capita sales in fiscal 2009 affecting catering, concessions and merchandise sales. In addition, the decrease was impacted by the strong sales of the Daytona 500 50th anniversary product in fiscal 2008. The decrease was slightly offset by the Nationwide series event weekend at Stock-Car Montreal.

Prize and point fund monies and NASCAR sanction fees increased approximately $8.3 million, or 5.4 percent, in fiscal 2009 as compared to fiscal 2008. This increase was primarily related to the Nationwide series event at Stock-Car Montreal and the previously discussed increase in television broadcast rights fees for the NASCAR Sprint Cup, Nationwide and Camping World Truck series events conducted during the year, as standard NASCAR sanctioning agreements require that a specific percentage of television broadcast rights fees be paid to competitors. To a lesser extent, increased NASCAR sanction fees, as well as the aforementioned reclassification of amounts related to Grand American in fiscal 2009 contributed to the increase.

Motorsports related expense decreased by approximately $16.2 million, or 9.8 percent, in fiscal 2009 as compared to fiscal 2008. The decrease was predominately attributable to reduced promotional, advertising and other race related expenses during the period as a result of focused cost containment initiatives as well as higher promotional and advertising expenses for the 50th running of the Daytona 500 in fiscal 2008. Partially offsetting these decreases was the Nationwide series event weekend at Stock-Car Montreal and to a lesser extent, the aforementioned reclassification of amounts related to Grand American competition costs in fiscal 2009. Motorsports related expense as a percentage of combined admissions and motorsports related revenue was comparable to the prior year, with the slight margin decrease primarily due to the previously discussed lower admissions and motorsports related revenues, as well as the aforementioned Stock-Car Montreal events conducted in the third quarter of fiscal 2009, largely offset by initiatives to reduce costs.

Food, beverage and merchandise expense decreased approximately $9.0 million, or 18.7 percent, in fiscal 2009 as compared to fiscal 2008. The decrease was primarily attributable to variable costs associated with the lower sales of merchandise, catering and concessions sales related to the previously discussed decreases in attendance. In addition, the decrease was impacted by the robust sales attributable to the previously discussed events conducted during Speedweeks at Daytona supporting the 50th running of the sold out Daytona 500 in fiscal 2008. Food, beverage and merchandise expense as a percentage of food, beverage and merchandise revenue increased to approximately 69.4 percent in fiscal 2009, as compared to 61.6 percent for fiscal 2008. Economies of scale and the ratio of fixed to variable costs attributed to the decrease in margin. This is especially evident for fiscal 2009 Speedweeks sales as compared to strong sales surrounding the 50th running of the Daytona 500 in fiscal 2008. The decrease in margin was partially offset by certain fixed cost reductions during the year.

General and administrative expense decreased approximately $5.7 million, or 5.2 percent, in fiscal 2009 as compared to fiscal 2008. Driven by focused cost containment initiatives, we reduced legal fees, other professional fees, personnel related and various other costs associated with our ongoing business compared to the prior year. In addition the decrease was impacted by an adjustment to certain other taxes in fiscal 2008. General and administrative expenses as a percentage of total revenues increased to approximately 15.0 percent for fiscal 2009, as compared to 13.9 percent for fiscal 2008. The slight margin decrease was primarily due to the previously discussed decrease in revenues, largely offset by our cost containment efforts.

Depreciation and amortization expense increased approximately $2.0 million, or 2.8 percent, in fiscal 2009 as compared to fiscal 2008. The increase was attributable to capital expenditures for our ongoing facility enhancements and related initiatives.

The impairment of long-lived assets of approximately $16.7 million in fiscal 2009 is primarily attributable to the aforementioned decrease in the carrying value of our Staten Island property and, to a much lesser extent, certain other long-lived asset impairments.

The fiscal 2008 impairment consisted primarily of costs associated with the fill removal process at our Staten Island property and impairments of certain other long-lived assets.

Interest income and other increased by approximately $2.7 million during fiscal 2009 as compared to fiscal 2008. The increase was almost entirely due to the aforementioned non-cash charge of $3.8 million, or $0.07 per diluted share, in fiscal 2008, to correct the carrying value of certain other assets. Slightly offsetting the increase were lower interest rates on higher cash balances as compared to the same period in the prior year.

Interest expense increased by approximately $3.3 million, or 21.1 percent, during fiscal 2009 as compared to fiscal 2008. The increase was primarily due to lower capitalized interest and higher average borrowings on our credit facility during the year (see discussion under “Liquidity and Capital Resources — General”) as compared to the same period in fiscal 2008, partially offset by the repayment of the $150 million principal 4.2 percent Senior Notes in April 2009.

Interest rate swap expense was approximately $4.3 million during fiscal 2009 attributable to interest rate swap agreement which was amended and re-designated in February 2009. There was no comparable expense in fiscal 2008.

Equity in net loss from equity investments represents our 50.0 percent equity investment in Motorsports Authentics (see “Equity and Other Investments”).

Our effective income tax rate increased from approximately 38.0 percent to 85.5 percent during fiscal 2009 compared to fiscal 2008. This increase in the effective income tax rate was primarily due to the tax treatment associated with income earned in fiscal 2008 and losses incurred in fiscal 2009 by Motorsports Authentics. The increase was partially offset by a decrease in the effective income tax rate due to the interest income related to the settlement with the Internal Revenue Service.

As a result of the foregoing, net income decreased approximately $127.8 million, or $2.57 per diluted share, for fiscal 2009 as compared to fiscal 2008.

Liquidity and Capital Resources

General

We have historically generated sufficient cash flow from operations to fund our working capital needs, capital expenditures at existing facilities, and return of capital through payments of an annual cash dividend and repurchase of our shares under our Stock Purchase Plan. In addition, we have used the proceeds from offerings of our Class A Common Stock, the net proceeds from the issuance of long-term debt, borrowings under our credit facilities and state and local mechanisms to fund acquisitions and development projects. At November 30, 2010, we had cash and cash equivalents totaling approximately $84.2 million, $87.0 million principal amount of senior notes outstanding, $102.0 million in borrowings on our $300.0 million revolving credit facility, a debt service funding commitment of approximately $63.6 million principal amount related to the taxable special obligation revenue (“TIF”) bonds issued by the Unified Government of Wyandotte County/Kansas City, Kansas (“Unified Government”) $51.0 million principal term loan related to our headquarters office building (the International Motorsports Center, or “IMC”); and $2.7 million principal amount of other third party debt. At November 30, 2010, we had working capital of $58.3 million, which was anchored by $84.2 million of cash. At November 30, 2009, we had working capital of $104.0 million, primarily driven by the $112.0 million recovery of funds previously on deposit with the Service.

Our liquidity is primarily generated from our ongoing motorsports operations, and we expect our strong operating cash flow to continue in the future. In addition, as of November 30, 2010, we have approximately $194.2 million available to draw upon under our newly negotiated 5-year revolving credit facility, if needed. See “Future Liquidity” for additional disclosures relating to our credit facility and certain risks that may affect our near term operating results and liquidity.

As it relates to capital allocation, our top priority is fan and competitor safety as well as regulatory compliance. In addition, we remain focused on driving incremental earnings by improving the fan experience with certain upgrades to our facilities to increase ticket sales. We will also focus on maintaining modest debt levels.

Beyond that, we are also making investments in strategic projects that complement our core business and provide value for our shareholders. Those options include acquisitions; new market development; ancillary real estate development; and share repurchases.

During fiscal year 2010, our significant cash flow items include the following:

	•		net cash provided by operating activities totaled approximately $112.4 million, which is net of payments related to interest rate swap totaling approximately $39.0 million;
	•		capital expenditures totaling approximately $105.9 million;
	•		payments of long-term debt totaling approximately $68.0 million;
	•		net proceeds of $27.0 million related to our Credit Facilities;
	•		contributions to the Hollywood Casino at Kansas Speedway joint venture, totaling approximately $31.5 million;
	•		dividends paid and reacquisitions of previously issued common stock totaling approximately $16.0 million; and
	•		decrease in restricted cash totaling approximately $9.1 million.

Capital Expenditures

     Capital expenditures totaled approximately $105.9 million for fiscal 2010, which includes $85.7 million for projects at our existing facilities related to the track repaving and other projects at Daytona, construction of a new media center at Michigan as part of the terrace suite redevelopment project; construction of a new state of the art LED leader board and video screens at Richmond; construction of grandstand seating enhancements at Michigan and Talladega; and a variety of other improvements and renovations. The remaining balance of approximately $20.2 million is related to the International Motorsports Center building which is funded from $9.1 million in long-term restricted cash; the purchase of land in Daytona; and additional capitalized spending for the Staten Island property. In comparison, capital expenditures for fiscal 2009 totaled approximately $113.7 million, which included approximately $32.2 million in long-term restricted cash used for the International Motorsports Center construction.

     At November 30, 2010, we have approximately $55.9 million remaining in capital projects currently approved for our existing facilities. These projects include the track repaving at Phoenix; grandstand seating enhancements and infield improvements at Michigan and Watkins Glen; parking improvements at Daytona; infield enhancements at Talladega; installation of track lighting and track enhancements at Kansas; improvements at various facilities for expansion of parking, camping capacity and other uses; and a variety of other improvements and renovations to our facilities that enable us to effectively compete with other sports venues for consumer and corporate spending.

     As a result of these currently approved projects and anticipated additional approvals in fiscal 2011, we expect our total fiscal 2011 capital expenditures at our existing facilities will be approximately $65 million to $75 million depending on the timing of certain projects. We review our capital expenditure program periodically and modify it as required to meet current business needs.

We review the capital expenditure program periodically and modify it as required to meet current business needs.

Future Liquidity

General

As discussed in “Future Trends in Operating Results,” economic conditions, including those affecting disposable consumer income and corporate budgets such as employment, business conditions, credit availability, interest rates and taxation rates, may impact our ability to sell tickets to our events and to secure revenues from corporate marketing partnerships. We believe that adverse economic trends, particularly the rise in unemployment and the decline in consumer confidence significantly contributed to the decrease in attendance for certain of our motorsports entertainment events during fiscal 2009. Certain of these trends have persisted throughout

fiscal 2010. This will negatively impact year-over-year comparability for most all of our revenue categories for the full year, with the exception of domestic broadcast and ancillary media rights fees.

Our cash flow from operations consists primarily of ticket, hospitality, merchandise, catering and concession sales and contracted revenues arising from television broadcast rights and marketing partnerships. Despite current economic conditions, we believe that cash flows from operations, along with existing cash, cash equivalents and available borrowings under our 2010 Credit Facility, will be sufficient to fund:

	•		operations and approved capital projects at existing facilities for the foreseeable future;
	•		payments required in connection with the funding of the Unified Government’s debt service requirements related to the TIF bonds;
	•		payments related to our existing debt service commitments;
	•		any equity contributions in connection with the Kansas Hotel and Casino development;
	•		any potential payments associated with our keepwell agreements; and
	•		payments for share repurchases under our Stock Purchase Plan.

We remain interested in pursuing further acquisition and/or development opportunities that would increase shareholder value. The timing, size and success, as well as associated potential capital commitments of which are unknown at this time. Accordingly, a material acceleration of our growth strategy could require us to obtain additional capital through debt and/or equity financings. Although there can be no assurance, over the longer term we believe that adequate debt and equity financing will be available on satisfactory terms.

While we expect our strong operating cash flow to continue in the future, our financial results depend significantly on a number of factors. In addition to local, national, and global economic and financial market conditions, consumer and corporate spending could be adversely affected by security and other lifestyle conditions resulting in lower than expected future operating cash flows. General economic conditions were significantly and negatively impacted by the September 11, 2001 terrorist attacks and the wars in Iraq and Afghanistan and could be similarly affected by any future attacks or fear of such attacks, or by conditions resulting from other acts or prospects of war. Any future attacks or wars or related threats could also increase our expenses related to insurance, security or other related matters. Also, our financial results could be adversely impacted by a widespread outbreak of a severe epidemiological crisis. The items discussed above could have a singular or compounded material adverse affect on our financial success and future cash flow.

Long-Term Obligations and Commitments

On April 23, 2004, we completed an offering of $300.0 million principal amount of unsecured senior notes in a private placement. On September 27, 2004, we completed an offer to exchange the senior notes for registered senior notes with substantially identical terms (“2004 Senior Notes”). The remaining 2004 Senior Notes which bear interest at 5.4 percent and are due April 2014 require semi-annual interest payments on April 15 and October 15 through their maturity. The 2004 Senior Notes may be redeemed in whole or in part, at our option, at any time or from time to time at redemption prices as defined in the indenture. Certain of our wholly owned domestic subsidiaries are guarantors of the 2004 Senior Notes. The 2004 Senior Notes also contain various restrictive covenants. Total gross proceeds from the sale of the 2004 Senior Notes were $300.0 million, net of discounts of approximately $431,000 and approximately $2.6 million of deferred financing fees. The deferred financing fees are being treated as additional interest expense and amortized over the life of the 2004 Senior Notes on a straight-line method, which approximates the effective yield method. In March 2004, we entered into interest rate swap agreements to effectively lock in the interest rate on approximately $150.0 million of the 2004 Senior Notes. We terminated the interest rate swap agreements on April 23, 2004 and received approximately $2.2 million, which was amortized over the life of $150.0 million of the 2004 Senior Notes that matured in April 2009.

In November 2010, we completed a cash tender offer where we purchased approximately $63.0 million on the remaining 2004 Senior Notes, including the payment of a tender premium of approximately $6.0 million and accrued interest. The net tender premium,

associated unamortized net deferred financing costs and unamortized original issuance discount were recorded as net loss on early tender of debt totaling approximately $6.5 million. At November 30, 2010, outstanding unsecured 2004 Senior Notes totaled approximately $87.0 million, net of unamortized discounts.

In June 2008, we entered into an interest rate swap agreement to effectively lock in a substantial portion of the interest rate exposure on approximately $150.0 million notional amount in anticipation of refinancing the $150.0 million 2004 Senior Notes that matured in April 2009. This interest rate swap was designated and qualified as a cash flow hedge under ASC 815, “Accounting for Derivatives and Hedging.” As a result of the uncertainty with the U.S. credit markets, in February 2009, we amended and re-designated our interest rate swap agreement as a cash flow hedge with an expiration in February 2011.

During fiscal 2010, based on our current financial position and reduction in the anticipated debt issuance from $150.0 million to $65.0 million, we discontinued this cash flow hedge and settled the related liability for approximately $39.0 million. As a result of these transactions we recognized approximately $4.3 million and $23.9 million of expense associated with this interest rate swap for the years ended November 30, 2009 and 2010, respectively. Included in fiscal 2010 expense is approximately $1.8 million of ineffectiveness associated with the interest rate swap. This expense was recorded in interest rate swap expense in the consolidated statement of operations. At November 30, 2010 we have approximately $6.6 million, net of tax, deferred in other comprehensive income associated with this interest rate swap which will be amortized over life of the future debt issuance (see below). We expect to recognize approximately $1.0 million of this balance during the next 12 months in interest expense in the consolidated statement of operations.

In January 2011 we completed an offering of approximately $65.0 million principal amount of senior unsecured notes in a private placement (“2021 Senior Notes”). The 2021 Senior Notes bear interest at 4.63 percent and are due January 2021. The 2021 Senior Notes require semi-annual interest payments on January 18 and July 18 through their maturity. The 2021 Senior Notes may be redeemed in whole or in part, at our option, at any time or from time to time at redemption prices as defined in the indenture. Certain of our wholly owned domestic subsidiaries are guarantors of the 2021 Senior Notes. The 2021 Senior Notes also contain various restrictive covenants. The deferred financing fees will be treated as additional interest expense and, along with the aforementioned deferred interest rate swap balance included in other comprehensive income, will be amortized over the life of the 2021 Senior Notes on a straight-line method, which approximates the effective yield method.

Debt associated with our wholly owned subsidiary, Raceway Associates, which owns and operates Chicagoland Speedway and Route 66 Raceway, consists of the following:

	•		Revenue bonds payable (“4.8 percent Revenue Bonds”) consisting of economic development revenue bonds issued by the City of Joliet, Illinois to finance certain land improvements. The 4.8 percent Revenue Bonds have an interest rate of 4.8 percent and a monthly payment of $29,000 principal and interest. At November 30, 2010, outstanding principal on the 4.8 percent Revenue Bonds was approximately $1.5 million.
	•		Revenue bonds payable (“6.8 percent Revenue Bonds”) that are special service area revenue bonds issued by the City of Joliet, Illinois to finance certain land improvements. The 6.8 percent Revenue Bonds are billed and paid as a special assessment on real estate taxes. Interest payments are due on a semi-annual basis at 6.8 percent with principal payments due annually. Final maturity of the 6.8 percent Revenue Bonds is January 2012. At November 30, 2010, outstanding principal on the 6.8 percent Revenue Bonds was approximately $1.2 million.

In July 2008, a wholly owned subsidiary of ours entered into a construction term loan agreement (“6.3 percent Term Loan”) to finance the construction of the International Motorsports Center. The 6.3 percent Term Loan has a 25 year term due October 2034, an interest rate of 6.3 percent, and a current monthly payment of approximately $292,000. At November 30, 2010, the outstanding principal on the 6.3 percent Term Loan was approximately $51.0 million.

In January 1999, the Unified Government, issued approximately $71.3 million in TIF bonds in connection with the financing of construction of Kansas Speedway. At November 30, 2010, outstanding TIF bonds totaled approximately $63.6 million, net of the unamortized discount, which is comprised of a $15.9 million principal amount, 6.2 percent term bond due December 1, 2017 and a $49.7 million principal amount, 6.8 percent term bond due December 1, 2027. The TIF bonds are repaid by the Unified Government

with payments made in lieu of property taxes (“Funding Commitment”) by our wholly owned subsidiary, Kansas Speedway Corporation (“KSC”). Principal (mandatory redemption) payments per the Funding Commitment are payable by Kansas Speedway Corporation on October 1 of each year. The semi-annual interest component of the Funding Commitment is payable on April 1 and October 1 of each year. Kansas Speedway Corporation granted a mortgage and security interest in the Kansas project for its Funding Commitment obligation.

In October 2002, the Unified Government issued subordinate sales tax special obligation revenue bonds (“2002 STAR Bonds”) totaling approximately $6.3 million to reimburse us for certain construction already completed on the second phase of the Kansas Speedway project and to fund certain additional construction. The 2002 STAR Bonds, which require annual debt service payments and are due December 1, 2022, will be retired with state and local taxes generated within the Kansas Speedway’s boundaries and are not our obligation. KSC has agreed to guarantee the payment of principal, any required premium and interest on the 2002 STAR Bonds. At November 30, 2010, the Unified Government had approximately $2.6 million in 2002 STAR Bonds outstanding. Under a keepwell agreement, we have agreed to provide financial assistance to KSC, if necessary, to support its guarantee of the 2002 STAR Bonds.

In November 2010, we entered into a $300.0 million revolving credit facility (“2010 Credit Facility”). The 2010 Credit Facility contains a feature that allows us to increase the credit facility to a total of $500.0 million, subject to certain conditions. Upon execution of the 2010 Credit Facility, we terminated our then existing $300.0 million revolving credit facility. The 2010 Credit Facility is scheduled to mature in November 2015, and accrues interest at LIBOR plus 150.0 — 225.0 basis points, depending on the better of our debt rating as determined by specified rating agencies or the our leverage ratio. The 2010 Credit Facility contains various restrictive covenants. At November 30, 2010, we had approximately $102.0 million outstanding under the 2010 Credit Facility. In January 2011, in connection with the issuance of the 2021 Senior Notes we repaid approximately $52.0 million of the amounts outstanding on the 2010 Credit Facility.

At November 30, 2010 we had contractual cash obligations to repay debt and to make payments under operating agreements, leases and commercial commitments in the form of guarantees and unused lines of credit. Payments due under these long-term obligations are as follows as of November 30, 2010 (in thousands):

						Obligations Due by Period
						Less Than												After
		Total				One Year				2-3 Years				4-5 Years				5 Years
Long-term debt		$	307,105			$	3,216			$	4,778			$	195,283			$	103,828
Motorsports entertainment facility operating agreement			29,220				2,220				4,440				4,440				18,120
Other operating leases			44,275				3,916				4,337				2,563				33,459
Total Contractual Cash Obligations		$	380,600			$	9,352			$	13,555			$	202,286			$	155,407

We have a total current tax liability of approximately $4.5 million and a long-term tax liability of approximately $2.1 million for uncertain tax positions, inclusive of tax, interest, and penalties included in our consolidated balance sheet at November 30, 2010, related to various state income tax matters. The contractual cash obligations table above excludes the long-term liability for these uncertain tax positions as we are unable to make a reasonably reliable estimate of the period of cash settlement with the respective taxing authorities.

Commercial commitment expirations are as follows as of November 30, 2010 (in thousands):

						Commitment Expiration by Period
						Less Than												After
		Total				One Year				2-3 Years				4-5 Years				5 Years
Guarantees		$	7,591			$	2,859			$	3,072			$	460			$	1,200
Unused credit facilities			198,000				—				—				198,000				—
Total Commercial Commitments		$	205,591			$	2,859			$	3,072			$	198,460			$	1,200

Stock Purchase Plan

In December 2006, we implemented a share repurchase program under which we are authorized to purchase up to $150.0 million of our outstanding Class A common shares. In February 2008, we announced that our Board of Directors had authorized an incremental $100.0 million share repurchase program. Collectively these programs are described as the “Stock Purchase Plans.” The Stock Purchase Plans allow us to purchase up to $250.0 million of our outstanding Class A common shares. The timing and amount of any shares repurchased under the Stock Purchase Plans will depend on a variety of factors, including price, corporate and regulatory requirements, capital availability and other market conditions. The Stock Purchase Plans may be suspended or discontinued at any time without prior notice. No shares have been or will be knowingly purchased from Company insiders or their affiliates.

Since inception of the Plan through November 30, 2010, we have purchased 5,222,613 shares of our Class A common shares, for a total of approximately $220.8 million. Included in these totals are the purchases of 307,886 shares of our Class A common shares during the fiscal year ended November 30, 2010, at an average cost of approximately $26.27 per share (including commissions), for a total of approximately $8.1million. These transactions occurred in open market purchases and pursuant to a trading plan under Rule 10b5-1. At November 30, 2010, we have approximately $29.2 million remaining repurchase authority under the current Stock Purchase Plans.

Speedway Developments

In light of NASCAR’s publicly announced position regarding additional potential realignment of the NASCAR Sprint Cup Series schedule, we believe there are still potential development opportunities for public/private partnerships in new, underserved markets across the country, which could include Denver, Colorado, the Northwest U.S. and the New York Metropolitan area.

Daytona Development Project

We are exploring development of a mixed-use entertainment destination development on 71 acres located directly across International Speedway Boulevard from our Daytona motorsports entertainment facility.

The initial development includes the approximately 188,000 square foot office building, the International Motorsports Center, completed in November 2009. The IMC houses the headquarters of ISC, NASCAR, Grand American and their related businesses, and additional space for other tenants. The IMC was financed in July 2008 through a $51.3 million construction term loan obtained by our wholly owned subsidiary, which was created to own and operate the office building.

Approved land use entitlements for the remaining project allow for a 265,000 square foot mixed-use retail/dining/entertainment area, plus a hotel, residential and additional office space. Development of the balance of the project is dependent on several factors, including lease arrangements, availability of project financing and overall market conditions.

While we continue to believe that a mixed-use retail/dining/entertainment area located across from our Daytona facility will be a successful project, given the current economic conditions and the uncertainty associated with the future, development of the project will depend on its economic feasibility.

Hollywood Casino at Kansas Speedway

On December 1, 2009, Kansas Entertainment, LLC, (“Kansas Entertainment”) a 50/50 joint venture of Penn Hollywood Kansas, Inc., a subsidiary of Penn and Kansas Speedway Development Corporation (“KSDC”), a wholly owned subsidiary of ISC, was selected by the Kansas Lottery Gaming Facility Review Board to develop and operate a gaming facility in the Northeast Zone (Wyandotte County, Kansas). On February 12, 2010, Kansas Entertainment received the final approval under the Kansas Expanded Lottery Act, along with its gaming license from the Kansas Racing and Gaming Commission. Construction of the Hollywood-themed and branded entertainment destination facility, overlooking turn two of Kansas Speedway, began in April 2010 with a planned opening in the first half of 2012.

The initial phase of this project, including certain changes to the scope and mix of gaming operations and amenities approved by the Kansas Lottery Commission in August 2010, features an 82,000 square foot casino with 2,000 slot machines and 52 table games (including 12 poker tables), a 1,253 space parking structure as well as a sports-themed bar, dining and entertainment options. Kansas Entertainment anticipates funding the initial phase of the development with a mix of equity contributions from each partner as well third party financing, which it is currently pursuing. KSDC and Penn will share equally in the cost of developing and constructing the

facility. We currently estimate that our share of capitalized development costs for the project, excluding our contribution of the land, will be approximately $155.0 million. In addition, we expect to continue to incur certain other start up and related costs through opening, a number of which will be expensed through equity in net loss from equity investments. Penn is the managing member of Kansas Entertainment and will be responsible for the development and operation of the casino and hotel.

Inflation

We do not believe that inflation has had a material impact on our operating costs and earnings.

Recent Accounting Pronouncements

In accordance with the ASC 805-50, “Business Combinations,” the topic was issued to retain the purchase method of accounting for acquisitions, but requires a number of changes, including changes in the way assets and liabilities are recognized in the purchase accounting. It also changes the recognition of assets acquired and liabilities assumed arising from contingencies, requires the capitalization of in-process research and development at fair value, and requires the expensing of acquisition-related costs as incurred. ASC 805-50 is effective for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. Our adoption of this statement in fiscal 2010 did not have an impact on our financial position and results of operations.

In accordance with the ASC 810-10, “Consolidation,” minority interests will be recharacterized as noncontrolling interests and will be reported as a component of equity separate from the parent’s equity, and purchases or sales of equity interests that do not result in a change in control will be accounted for as equity transactions. In addition, net income attributable to the noncontrolling interest will be included in consolidated net income on the face of the income statement and upon a loss of control, the interest sold, as well as any interest retained, will be recorded at fair value with any gain or loss recognized in earnings. This portion of ASC 810-10 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years, except for the presentation and disclosure requirements, which will apply retrospectively. Our adoption of this statement in fiscal 2010 did not have an impact on our financial position and results of operations.

Also, in accordance with ASC 810-10, the improvement of financial reporting by enterprises involved with variable interest entities was made by addressing (1) the effects on certain provisions of Financial Accounting Standards Board (“FASB”) Interpretation No. 46 (revised December 2003), “Consolidation of Variable Interest Entities,” as a result of the elimination of the qualifying special-purpose entity concept in the ASC 860-10, “Transfers and Servicing,” and (2) constituent concerns about the application of certain key provisions of Interpretation 46(R), including those in which the accounting and disclosures under the Interpretation do not always provide timely and useful information about an enterprise’s involvement in a variable interest entity. This portion of ASC 810-10 is effective for financial statements issued for fiscal years beginning after November 15, 2009, with earlier adoption prohibited. Our adoption of this statement in fiscal 2010 did not have an impact on our financial position and results of operations.

In accordance with the ASC 260-10-45, “Earnings Per Share,” instruments granted in share-based payment transactions are participating securities prior to vesting and, therefore, need to be included in computing earnings per share under the two-class method. ASC 260-10-45 affects entities that accrue dividends on share-based payment awards during the associated service period when the return of dividends is not required if employees forfeit such awards. ASC 260-10-45 is effective for fiscal years and interim periods beginning after December 15, 2008. Our adoption of this statement in fiscal 2010 did not have an impact on our financial position and results of operations.

In accordance with the ASC 323-10, “Investments — Equity Method and Joint Ventures,” questions that have arisen regarding the application of the equity method subsequent to the issuance of SFAS No. 141R and SFAS No. 160. This portion of ASC 323-10 is effective for fiscal years beginning after December 15, 2008, and interim periods within those years. Early application is not permitted. Our adoption of this statement in fiscal 2010 did not have an impact on our financial position and results of operations.

Accounting Standards Update (ASU) 2010-06, “Improving Disclosures about Fair Value Measurements”, an amendment to ASC 820, “Fair Value Measurements and Disclosures”, was issued to provide more information regarding the transfers in and out of Levels 1 and 2 inputs as well as additional disclosures about Level 3 inputs. The disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. Those disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Our adoption of this statement in fiscal 2010 did not have an impact on our financial position and results of operations.

In September 2009, FASB amended ASC 605, as summarized in ASU 2009-13, Revenue Recognition: Multiple-Deliverable Revenue Arrangements. As summarized in ASU 2009-13, ASC Topic 605 has been amended: (1) to provide updated guidance on whether multiple deliverables exist, how the deliverables in an arrangement should be separated, and the consideration allocated; (2) to require an entity to allocate revenue in an arrangement using estimated selling prices of deliverables if a vendor does not have VSOE or third-party evidence of selling price; and (3) to eliminate the use of the residual method and require an entity to allocate revenue using the relative selling price method. The accounting changes in ASU 2009-13 are both effective for fiscal years beginning on or after June 15, 2010, with early adoption permitted. Adoption may either be on a prospective basis or by retrospective application. We are currently evaluating the potential impact that the adoption of this statement will have on our financial position and results from operations and will adopt the provision of this statement in fiscal 2011.

Factors That May Affect Operating Results

This report and the documents incorporated by reference may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can identify a forward-looking statement by our use of the words “anticipate,” “estimate,” “expect,” “may,” “believe,” “objective,” “projection,” “forecast,” “goal,” and similar expressions. These forward-looking statements include our statements regarding the timing of future events, our anticipated future operations and our anticipated future financial position and cash requirements. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we do not know whether our expectations will prove correct. We disclose the important factors that could cause our actual results to differ from our expectations in cautionary statements made in this report and in other filings we have made with the Securities and Exchange Commission. All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of the risk factors described in this report and other factors set forth in or incorporated by reference in this report.

Many of these factors are beyond our ability to control or predict. We caution you not to put undue reliance on forward-looking statements or to project any future results based on such statements or on present or prior earnings levels. Additional information concerning these, or other factors, which could cause the actual results to differ materially from those in the forward-looking statements is contained from time to time in our other SEC filings. Copies of those filings are available from us and/or the SEC.

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

We are exposed to market risk from changes in interest rates in the normal course of business. Our interest income and expense are most sensitive to changes in the general level of U.S. interest rates and the LIBOR rate. In order to manage this exposure, from time to time we use a combination of debt instruments, including the use of derivatives in the form of interest rate swap and lock agreements. We do not enter into any derivatives for trading purposes.

The objective of our asset management activities is to provide an adequate level of interest income and liquidity to fund operations and capital expansion, while minimizing market risk. We utilize overnight sweep accounts and short-term investments to minimize the interest rate risk. We do not believe that our interest rate risk related to our cash equivalents and short-term investments is material due to the nature of the investments.

Our objective in managing our interest rate risk on our debt is to negotiate the most favorable interest rate structures that we can and, as market conditions evolve, adjust our balance of fixed and variable rate debt to optimize our overall borrowing costs within reasonable risk parameters. Interest rate swaps and locks are used from time to time to convert a portion of our debt portfolio from a variable rate to a fixed rate or from a fixed rate to a variable rate as well as to lock in certain rates for future debt issuances.

The following analysis provides quantitative information regarding our exposure to interest rate risk. We utilize valuation models to evaluate the sensitivity of the fair value of financial instruments with exposure to market risk that assume instantaneous, parallel shifts in interest rate yield curves. There are certain limitations inherent in the sensitivity analyses presented, primarily due to the assumption that interest rates change instantaneously. In addition, the analyses are unable to reflect the complex market reactions that normally would arise from the market shifts modeled.

We have various debt instruments that are issued at fixed rates. These financial instruments, which have a fixed rate of interest, are exposed to fluctuations in fair value resulting from changes in market interest rates. The fair values of long-term debt are based on quoted market prices at the date of measurement. Our credit facilities approximate fair value as they bear interest rates that approximate market. At November 30, 2010, we had approximately $102.0 million of variable debt outstanding; therefore, a hypothetical increase in interest rates by 1.0 percent would result in an increase in our annual interest expense of approximately $1.0 million.

At November 30, 2010, the fair value of our total long-term debt as determined by quotes from financial institutions was approximately $305.6 million. The potential decrease in fair value resulting from a hypothetical 10.0 percent shift in interest rates

would be approximately $5.1 million at November 30, 2010.

Credit risk arises from the possible inability of counterparties to meet the terms of their contracts on a net basis. However, we minimize such risk exposures for these instruments by limiting counterparties to large banks and financial institutions that meet established credit guidelines. We do not expect to incur any losses as a result of counterparty default.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders
International Speedway Corporation

We have audited the accompanying consolidated balance sheets of International Speedway Corporation (the Company) as of November 30, 2010 and 2009, and the related consolidated statements of operations, shareholders’ equity and cash flows for each of the three years in the period ended November 30, 2010. Our audits also include the financial statement schedule listed in the Index at Item 15(a). These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits. We did not audit the financial statements of Motorsports Authentics, LLC (a corporation in which International Speedway Corporation has a 50 percent interest). The financial statements of Motorsports Authentics, LLC have been audited by other auditors whose report has been furnished to us, and our opinion on the consolidated financial statements, as of November 30, 2009 and for the year then ended, insofar as it relates to the amounts included for Motorsports Authentics, LLC, is based solely on the report of the other auditors. In the consolidated financial statements, International Speedway Corporation’s equity investment in Motorsports Authentics, LLC is $0 at November 30, 2009, and the Company’s equity in the net loss of Motorsports Authentics, LLC is $78 million for the year then ended.

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

In our opinion, based on our audits and the report of other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of International Speedway Corporation at November 30, 2010 and 2009, and the consolidated results of its operations and its cash flows for each of the three years in the period ended November 30, 2010, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), International Speedway Corporation’s internal control over financial reporting as of November 30, 2010, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated January 28, 2011, expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Certified Public Accountants

Jacksonville, Florida
January 28, 2011

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders
International Speedway Corporation

We have audited International Speedway Corporation’s internal control over financial reporting as of November 30, 2010, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). International Speedway Corporation’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Report of Management on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, International Speedway Corporation maintained, in all material respects, effective internal control over financial reporting as of November 30, 2010, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of International Speedway Corporation as of November 30, 2010 and 2009, and the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the three years in the period ended November 30, 2010 of International Speedway Corporation and our report dated January 28, 2011 expressed an unqualified opinion thereon. We did not audit the financial statements of Motorsports Authentics, LLC (a corporation in which International Speedway Corporation has a 50 percent interest). The financial statements of Motorsports Authentics, LLC have been audited by other auditors whose report has been furnished to us, and our opinion on the consolidated financial statements, as of November 30, 2009 and for the year then ended, insofar as it relates to the amounts included for Motorsports Authentics, LLC, is based solely on the report of the other auditors. In the consolidated financial statements, International Speedway Corporation’s equity investment in Motorsports Authentics, LLC is $0, at November 30, 2009, and the Company’s equity in the net loss of Motorsports Authentics, LLC is $78 million, for the year then ended.

/s/ Ernst & Young LLP

Certified Public Accountants

Jacksonville, Florida
January 28, 2011

INTERNATIONAL SPEEDWAY CORPORATION
Consolidated Balance Sheets

		November 30,
		2009				2010
		(in thousands, except share and per share amounts)
ASSETS
Current Assets:
Cash and cash equivalents		$	158,572			$	84,166
Short-term investments			200				—
Receivables, less allowance of $1,200 in 2009 and 2010			41,934				33,935
Inventories			2,963				2,733
Income taxes receivable			4,015				18,108
Deferred income taxes			2,172				4,288
Prepaid expenses and other current assets			8,100				6,776
Total Current Assets			217,956				150,006
Property and Equipment, net			1,353,636				1,376,751
Other Assets:
Long-term restricted cash and investments			10,144				1,002
Equity investments			—				43,689
Intangible assets, net			178,610				178,609
Goodwill			118,791				118,791
Other			29,766				9,901
			337,311				351,992
Total Assets		$	1,908,903			$	1,878,749
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Current portion of long-term debt		$	3,387			$	3,216
Accounts payable			18,801				15,829
Deferred income			63,999				49,202
Income taxes payable			8,668				—
Current tax liabilities			—				4,492
Other current liabilities			19,062				19,000
Total Current Liabilities			113,917				91,739
Long-Term Debt			343,793				303,074
Deferred Income Taxes			239,767				279,641
Long-Term Tax Liabilities			20,917				2,131
Long-Term Deferred Income			12,775				11,915
Other Long-Term Liabilities			30,481				3,072
Commitments and Contingencies			—				—
Shareholders’ Equity:
Class A Common Stock, $.01 par value, 80,000,000 shares authorized; 27,810,169 and 27,531,352 issued and outstanding in 2009 and 2010, respectively			278				275
Class B Common Stock, $.01 par value, 40,000,000 shares authorized; 20,579,682 and 20,373,199 issued and outstanding in 2009 and 2010, respectively			205				203
Additional paid-in capital			493,765				481,154
Retained earnings			665,274				712,099
Accumulated other comprehensive loss			(12,269	)			(6,554	)
Total Shareholders’ Equity			1,147,253				1,187,177
Total Liabilities and Shareholders’ Equity		$	1,908,903			$	1,878,749

See accompanying notes

INTERNATIONAL SPEEDWAY CORPORATION
Consolidated Statements of Operations

		Year Ended November 30,
		2008				2009				2010
		(in thousands, except share and per share amounts)
REVENUES:
Admissions, net		$	236,105			$	195,509			$	160,476
Motorsports related			462,835				432,217				420,910
Food, beverage and merchandise			78,119				56,397				52,527
Other			10,195				9,040				11,444
			787,254				693,163				645,357
EXPENSES:
Direct:
Prize and point fund monies and NASCAR sanction fees			154,655				162,960				157,571
Motorsports related			166,047				149,826				142,603
Food, beverage and merchandise			48,159				39,134				36,949
General and administrative			109,439				103,773				102,733
Depreciation and amortization			70,911				72,900				74,465
Impairment of long-lived assets			2,237				16,747				8,859
			551,448				545,340				523,180
Operating income			235,806				147,823				122,177
Interest income and other			(1,630	)			1,080				170
Interest expense			(15,861	)			(19,203	)			(15,216	)
Interest rate swap expense			—				(4,268	)			(23,878	)
Loss on early redemption of debt			—				—				(6,535	)
Other income			324				426				—
Equity in net loss from equity investments			(1,203	)			(77,608	)			(1,904	)
Income from continuing operations before income taxes			217,436				48,250				74,814
Income taxes			82,678				41,265				20,236
Income from continuing operations			134,758				6,985				54,578
Loss from discontinued operations, net of income taxes of ($143), ($124) and ($25), respectively			(163	)			(170	)			(47	)
Net income		$	134,595			$	6,815			$	54,531
Basic earnings per share:
Income from continuing operations		$	2.71			$	0.14			$	1.13
Loss from discontinued operations			—				—				—
Net income		$	2.71			$	0.14			$	1.13
Diluted earnings per share:
Income from continuing operations		$	2.71			$	0.14			$	1.13
Loss from discontinued operations			—				—				—
Net income		$	2.71			$	0.14			$	1.13
Dividends per share		$	0.12			$	0.14			$	0.16
Basic weighted average shares outstanding			49,589,465				48,520,661				48,101,529
Diluted weighted average shares outstanding			49,688,909				48,633,730				48,194,837

See accompanying notes

INTERNATIONAL SPEEDWAY CORPORATION
Consolidated Statements of Changes in Shareholders’ Equity
(in thousands)

		Class A				Class B												Accumulated
		Common				Common												Other
		Stock				Stock				Additional								Comprehensive				Total
		$.01 Par				$.01 Par				Paid-in				Retained				(Loss)				Shareholders’
		Value				Value				Capital				Earnings				Income				Equity
Balance at November 30, 2007		$	300			$	216			$	621,528			$	537,044			$	—			$	1,159,088
Comprehensive income
Net income			—				—				—				134,595				—				134,595
Interest rate swap fair value, including tax benefit of $8,592			—				—				—				—				(13,216	)			(13,216	)
Total comprehensive income																							121,379
Cash dividends ($.12 per share)			—				—				—				(5,960	)			—				(5,960	)
Other			—				—				—				(324	)			—				(324	)
Reacquisition of previously issued common stock			(31	)			—				(127,432	)			50				—				(127,413	)
Conversion of Class B Common Stock to Class A Common Stock			5				(5	)			—				—				—				—
Income tax expense related to stock-based compensation			—				—				(101	)			—				—				(101	)
Stock-based compensation			—				—				3,282				—				—				3,282
Balance at November 30, 2008			274				211				497,277				665,405				(13,216	)			1,149,951
Comprehensive income
Net income			—				—				—				6,815				—				6,815
Loss on currency translation, including tax benefit of $23			—				—				—				—				(34	)			(34	)
Interest rate swap expense net of income taxes of $1,682			—				—				—				—				2,586				2,586
Interest rate swap fair value adjustment, net of tax benefit of $1,043			—				—				—				—				(1,605	)			(1,605	)
Total comprehensive income																							947
Cash dividends ($.14 per share)			—				—				—				(6,822	)			—				(6,822	)
Other			—				—				—				(426	)			—				(426	)
Reacquisition of previously issued common stock			(2	)			—				(5,264	)			302				—				(4,964	)
Conversion of Class B Common Stock to Class A Common Stock			6				(6	)			—				—				—				—
Income tax expense related to stock-based compensation			—				—				(420	)			—				—				(420	)
Stock-based compensation			—				—				2,172				—				—				2,172
Balance at November 30, 2009			278				205				493,765				665,274				(12,269	)			1,147,253
Comprehensive income
Net income			—				—				—				54,531				—				54,531
Gain on currency translation, net of income taxes of $38			—				—				—				—				59				59
Interest rate swap expense, net of income taxes of $8,777			—				—				—				—				13,442				13,442
Interest rate swap fair value adjustment, net of tax benefit of $5,063			—				—				—				—				(7,786	)			(7,786	)
Total comprehensive income																							5,715
Cash dividends ($.16 per share)			—				—				—				(7,706	)			—				(7,706	)
Reacquisition of previously issued common stock			(5	)			—				(13,845	)							—				(13,850	)
Conversion of Class B Common Stock to Class A Common Stock			2				(2	)			—				—				—				—
Income tax expense related to stock-based compensation			—				—				(585	)			—				—				(585	)
Stock-based compensation			—				—				1,819				—				—				1,819
Balance at November 30, 2010		$	275			$	203			$	481,154			$	712,099			$	(6,554	)		$	1,187,177