The 'BB' corporate credit reflects Speedway Motorsports Inc.'s (SMI) reliance on an event-driven business model, the susceptibility of its revenue base to the economic cycle, and the existence of substitute entertainment events. Also, under Standard&Poor's Ratings Services' current assumptions, we expect that the company will experience further declines in revenue and EBITDA in 2011, causing the cushion relative to the company's total leverage covenant to thin by the end of 2011. Partially offsetting these risks are the company's strong EBITDA margin, good market position the motorsports industry, and high barriers to entry stemming from high capital costs for new racetracks, long construction lead times, and a limited supply of high-margin NASCAR racing dates. We view the company's business
