Exhibit 99.1



SPEEDWAY MOTORSPORTS, INC.

RISK FACTORS



You should carefully
consider and evaluate all of the risk factors set forth below in the context of any forward-looking statement, either oral or written, made from time to time by Speedway Motorsports, Inc. (SMI) and its subsidiaries, officers or
directors. The annual, quarterly and current reports and proxy statements we file with the Securities and Exchange Commission (SEC) and the documents we incorporate by reference in such reports and statements as well as the press
releases we issue from time to time and the oral and written statements of our officers and directors made from time to time 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 forward-looking statements by our use of the words expects, anticipates, approximates, believes, estimates,
hopes, intends, may, plans, should, will and variations of such words and similar expressions. These forward-looking statements may include, among other things: (1) statements
in this Annual Report on Form 10-K that reflect projections or expectations of our future financial or economic performance; (2) statements that are not historical information; (3) statements of our beliefs, intentions, objectives, plans, and
strategies for future operations, including those contained in Business, Properties, Legal Proceedings, Controls and Procedures, Managements Discussion and Analysis of Financial Condition
and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk; (4) statements relating to our operations or activities, including revenues, costs and margins for 2005 and beyond; and (5) statements
relating to our future capital projects, hosting of races, broadcasting rights, sponsorships, financing needs, petroleum or other commodities, and legal proceedings and other contingencies.



Although we believe the expectations reflected in our forward-looking statements are
reasonable, we do not know whether our expectations will prove correct. We disclose important factors that could cause our actual results to differ from our expectations in cautionary statements in our filings with the SEC. 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 or events could differ materially from those projected, estimated,
assumed or anticipated in any such forward-looking statements as a result of the risk factors described in these reports, other factors set forth in or incorporated by reference in these reports and as set forth below.



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 or financial condition. Some of the factors that could cause the actual results to differ materially are
set forth below. Additional information concerning these or other factors that 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, through our website as well as by direct inquiry, and from the SEC. The forward-looking statements we make are based on information available to us as of the date such statements are made, and we assume no obligation
to update any such forward-looking information contained in this report.



Consumer and corporate spending can significantly impact operating results.



Our business depends on discretionary consumer and corporate spending. Many factors related to discretionary consumer spending, including economic conditions affecting disposable consumer income such as employment,
rising fuel prices, interest and tax rates and inflation, can significantly impact our operating results. Many factors related to corporate spending such as general economic and other business conditions, including consumer spending, rising fuel
prices, interest and tax rates, and inflation, as well as various industry conditions, including corporate marketing and promotional spending and interest levels, can also significantly impact our operating results. These factors can affect
attendance at our events, suite rentals, sponsorship, advertising and hospitality spending, concession and souvenir sales, as well as the financial results of present and potential sponsors of our facilities and events and of the industry. Negative
factors such as challenging economic conditions, public concerns over additional national security incidents and air travel, particularly when combined, can impact corporate and individual customer spending, and one negative factor can impact our
results more than another. There can be no assurance that consumer and corporate spending will not be adversely impacted by economic conditions, thereby possibly impacting our operating results and growth.



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Bad weather adversely affects the profitability of our motorsports events.



We promote outdoor motorsports events. Weather conditions surrounding these events affect
sales of tickets, concessions and souvenirs, among other things. Although we sell tickets well in advance of our events, poor weather conditions can have a material effect on our results of operations particularly because we promote a finite number
of premier events. Due to weather conditions, we may be required to move a race event to the next raceable day, which would increase our costs for the event and could negatively impact our walk-up admissions, if any, and food, beverage and souvenir
sales. Poor weather can affect current periods as well as successive events in future periods.



Failure to be awarded a NASCAR event or deterioration in our relationship with NASCAR could adversely affect our profitability.



Our success has been and will remain dependent to a significant extent upon maintaining a good working relationship with the organizations
that sanction the races we promote at our facilities, particularly NASCAR, the sanctioning body for NEXTEL Cup, Busch Series and Craftsman Truck Series races. We currently host eleven NEXTEL Cup races and eight Busch Series races. In 2004, we
derived approximately 80% of our total revenues from events sanctioned by NASCAR. Each NASCAR event is awarded on an annual basis. Although we believe that our relationship with NASCAR is good, NASCAR is under no obligation to continue to license
SMI to sponsor any event. Nonrenewal of a NASCAR event license would have a material adverse effect on our financial condition and future results of operations. We cannot assure you that we will continue to obtain NASCAR licenses to sponsor races at
such facilities. Our strategy has included growth through the addition of motorsports facilities. Failure to obtain NASCAR events for any future additional motorsports facility could have a material adverse effect us. Similarly, NASCAR is not
obligated to modify its race schedules to allow us to schedule our races more efficiently or favorably.



National or local catastrophes and elevated terrorism alerts could have a significant adverse impact on our operating results.



The national security incidents of September 11, 2001, military actions in Iraq, and periodic elevated terrorism alerts have raised numerous
challenging operating factors including public concerns regarding air travel, military actions, and additional national or local catastrophic incidents. These factors have adversely affected, and may continue to adversely affect, consumer and
corporate spending sentiment. Should difficulties, restrictions or public concerns regarding air travel or military-related actions continue or increase, or if additional national or local terrorist, catastrophic or other incidents occur, there can
be no assurance that consumer and corporate spending will not be adversely impacted, thereby possibly materially impacting our operating results and growth. Economic conditions could be severely affected by future actual or threats of similar or
other national, regional or local incidents, which could have a material adverse effect on our future operating results.



Costs associated with and ability to obtain adequate insurance could adversely affect our profitability and financial condition.



Heightened concerns and challenges regarding property, casualty, liability, business
interruption, and other insurance coverage have resulted from the national incidents on September 11, 2001. We have experienced increased difficulty obtaining high policy limits of coverage at reasonable costs, including coverage for acts of
terrorism. We have a material investment in property and equipment at each of our six speedway facilities, which are generally located near highly populated cities and which hold motorsports events typically attended by large numbers of fans. At
December 31, 2004, we had property and equipment with a net book value of approximately $914.0 million.



These operational, geographical and situational factors, among others, have resulted in, and may continue to result in, significant increases in insurance premium costs and difficulties obtaining sufficiently high
policy limits. We cannot assure you that future increases in such insurance costs and difficulties obtaining high policy limits will not adversely impact our profitability, thereby possibly impacting our operating results and growth.



In addition, while management attempts to obtain and believes it presently has reasonable
policy limits of property,



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casualty, liability, and business interruption insurance in force, including coverage for acts of terrorism, with financially sound insurers, we cannot
guarantee that such coverage would be adequate under the circumstances should one or multiple catastrophic events occur at or near any of our speedway facilities, or that our insurers would have adequate financial resources to sufficiently or fully
pay our related claims or damages. Once our present coverage expires, we cannot guarantee that adequate coverage limits will be available, offered at reasonable costs, or offered by insurers with sufficient financial soundness. The occurrence of
such an incident or incidents affecting any one or more of our speedway facilities could have a material adverse effect on our financial position and future results of operations if asset damage and/or company liability was to exceed insurance
coverage limits or if an insurer was unable to sufficiently or fully pay our related claims or damages. The occurrence of additional national incidents, in particular incidents at sporting events, entertainment or other public venues, may
significantly impair our ability to obtain such insurance coverage in the future.



We use a combination of insurance and self-insurance to manage various risks associated with our speedway and other properties, and motorsports events and other business risks. We may increase the marketing of certain products using
self-insured promotional warranty programs which could subject us to increased risk of loss should the number and amount of claims significantly increase. Also, we may increase our bulk commodity business for which we intend to obtain customary
insurance with experienced carriers. We have increased and may further increase our self-insurance limits which could subject us to increased risk of loss should the number of incidents, damages, casualties or other claims below such self-insured
limits increase. While management believes it has reasonable self-insurance limits in place, management can not guarantee that the number of uninsured losses will not increase. An increase in the number of uninsured losses could have a material
adverse effect on our financial position and future results of operations.



Postponement and/or cancellation or relocation of major motorsports events could adversely affect us.



If an event scheduled for one of our facilities is postponed because of weather or other reasons such as, for example, the general postponement of all major sporting
events in this country 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 admissions, food, beverage and souvenir sales
generated 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 associated with the event, including live broadcast revenues, to the extent
such losses were not covered by insurance.



If a cancelled event is part of the
NASCAR NEXTEL Cup or Busch Series, the amount of money we receive from television revenues for all of our NASCAR-sanctioned events in the series that experienced the cancellation could be reduced. 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.



NASCAR has announced it would consider potential track realignment of NEXTEL Cup Series racing events to desirable, potentially more profitable market venues of speedway
operators. While relocation of any NEXTEL Cup event among our speedways we now or may own in the future could result in a net increase in our future operating profitability, long-lived assets of a speedway from where a NEXTEL Cup racing event may
move could become impaired resulting in a material impairment charge that adversely affects our financial condition or future results of operations.



High competition in the motorsports industry could hinder our ability to maintain or improve our position in the industry.



Motorsports promotion is a competitive industry. We compete in regional and national markets
to promote events, especially NASCAR-sanctioned events. We believe our principal competitors are other motorsports promoters of NEXTEL Cup or equivalent events. Certain of our competitors have resources that exceed ours. NASCAR is owned by Bill
France, Jr., Jim France, and the France family, who also control ISC. ISC presently sponsors several NEXTEL Cup races. The France family is part owner of another track that hosts two NASCAR NEXTEL Cup events. We are the leading motorsports promoter
in the local and regional markets served by AMS, BMS, IR, LVMS, LMS and TMS and compete regionally and nationally with ISC and other NASCAR related speedways to sponsor NASCAR events, especially NEXTEL Cup events, and, to a lesser extent, with other
speedway owners to



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sponsor CCWS, IRL, and NHRA sanctioned events. Less importantly, we compete for spectator interest with all forms of professional and amateur spring, summer,
and fall sports conducted in and near Atlanta, Bristol, Charlotte, Las Vegas, Dallas-Fort Worth, and San Francisco, many of which have resources that exceed ours, and with a wide range of other available entertainment and recreational activities. We
cannot assure you that we will maintain or improve our position in light of such competition.



The loss of our key personnel could adversely affect our operations and growth.



Our success depends to a great extent upon the availability and performance of our senior management, particularly O. Bruton Smith, our Chairman and Chief Executive
Officer, H.A. Wheeler, our President and Chief Operating Officer, and William R. Brooks, our Chief Financial Officer, Executive Vice President and Treasurer. Messrs. Smith and Wheeler have managed SMI as a team for over 25 years, and Mr. Brooks has
been part of the management team for over 20 years. Their experience within the industry, especially their working relationship with NASCAR, will continue to be of considerable importance to us. The loss of any of our key personnel due to illness,
retirement or otherwise, or our inability to attract and retain key employees in the future could have a material adverse effect on our operations and business plans.



Costs associated with capital improvements could adversely affect our profitability.



Significant growth in our revenues depends, in large part, on consistent investment in
facilities. Therefore, we expect to continue to make substantial capital improvements in our facilities to meet long-term increasing demand, to increase spectator entertainment value, and to increase revenue. We frequently have a number of
significant capital projects underway. Numerous factors, many of which are beyond our control, may influence the ultimate costs and timing of various capital improvements at our facilities, including:



| |  |  | undetected soil or land conditions;
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| |  |  | additional land acquisition costs;
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| |  |  | increases in the cost of construction materials and labor;
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| |  |  | unforeseen changes in design;
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| |  |  | litigation, accidents or natural disasters affecting the construction site; and
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| |  |  | national or regional economic changes.
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In addition, actual costs could vary materially from our estimates if those factors and our assumptions about the quality of materials or workmanship required or the cost
of financing such construction were to change. Construction is also subject to state and local permitting processes, which if changed, could materially affect the ultimate cost.



Lack of closeness or competitiveness of NASCAR NEXTEL Cup Series championship points race can significantly impact operating results.



The lack of closeness or competitiveness of the championship points race
of the NEXTEL Cup Series in any particular racing season can significantly impact our operating results. These factors can affect attendance at the NEXTEL Cup racing events, as well as other events surrounding the weekends such NEXTEL Cup races are
promoted. In the fourth quarter 2005, we are currently scheduled to conduct three NEXTEL Cup and two Busch Series events. There can be no assurance that attendance will not be adversely impacted by the lack of a close or competitive championship
points race in any particular season, thereby possibly impacting our operations and growth.



Our revenues depend on the promotional success of our marketing campaigns.



Similar to many companies, we spend significant amounts on advertising, promotional and other marketing campaigns for our speedways and other business activities. Such
marketing activities include, among others, promotion of ticket sales, luxury suite rentals, hospitality and other services for our speedway events and facilities, and advertising associated with our wholesale and retail distribution of racing and
other sports related souvenir merchandise and apparel, micro-lubricant products, and Legends Car activities. There can be no assurance that such advertising, promotional and other marketing campaigns will be successful or will generate revenues or profits.



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Government regulation of certain motorsports sponsors could negatively impact the availability of promotion,
sponsorship and advertising revenue for us.



The motorsports industry
generates significant revenue each year from the promotion, sponsorship and advertising of various companies and their products. Government regulation can adversely impact the availability to motorsports of its promotion, sponsorship and advertising
revenue. Advertising of the tobacco and liquor industries is generally subject to greater governmental regulation than advertising by other sponsors of our events. In addition, certain of our sponsorship contracts are terminable upon the
implementation of adverse regulations.



We cannot assure you that:



| |  |  | the tobacco or alcohol industry will continue to sponsor motorsports events;
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| |  |  | suitable alternative sponsors could be located; or
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| |  |  | NASCAR will continue to sanction individual racing events sponsored by the tobacco or alcohol industry at any of our facilities.
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In 1999, major United States companies in the tobacco industry entered into various
agreements with the Attorneys General of all 50 states to settle certain state-initiated litigation against the tobacco industry. The settlement agreements place various limits on the sponsorship of sports, including motorsports, by the tobacco
industry. Among other things, a tobacco manufacturer is limited to a single brand name sponsorship in any twelve-month period and is prohibited from entering into any agreement for naming a stadium or arena using the brand name of a tobacco product.
In 2003, NASCAR announced that R.J. Reynolds Tobacco Co. would no longer sponsor NASCARs premier national series because of increasing limitations on tobacco companies marketing activities and other financial obligations. In 2004, Nextel
Communications, Inc. replaced R.J. Reynolds Tobacco Co. as the title sponsor of NASCARs premier national series. We are unaware of any proposed governmental regulation that would materially limit the availability to motorsports of promotion,
sponsorship or advertising revenue from the alcoholic beverage industry. In addition, the tobacco and alcoholic beverage industries provide financial support to the motorsports industry through, among other things, their purchase of advertising
time, their sponsorship of racing teams and their sponsorship of racing series such as the Busch Series. Implementation of further restrictions on the advertising or promotion of tobacco or alcoholic beverage products could adversely affect us.



Our chairman owns a majority of SMIs common stock and will control
any matter submitted to a vote of our stockholders.



As of December 31,
2004, Mr. O. Bruton Smith, our Chairman and Chief Executive Officer, beneficially owned, directly and indirectly, approximately 63.4% of the undiluted outstanding shares of our common stock. As a result, Mr. Smith will continue to control the
outcome of substantially all issues submitted to our stockholders, including the election of all of our directors.



Our substantial indebtedness could adversely affect the financial health of our company, our operations, ability to pay dividends, or prevent us from fulfilling our
obligations under our debt agreements.



We have a significant amount of
indebtedness. As of December 31, 2004, we had total outstanding long-term debt of approximately $427.1 million. In March 2005, we amended our Credit Facility to, among other things, increase the separate sub-limit for standby letters of credit from
$10.0 million to $75.0 million, while maintaining the overall revolving credit facility borrowing limit of $250.0 million. Our substantial indebtedness and ability to increase our outstanding borrowings could have important consequences. For
example, it could:



| |  |  | make it more difficult for us to satisfy our debt obligations;
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| |  |  | increase our vulnerability to general adverse economic and industry conditions or a downturn in our business;
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| |  |  | limit our ability to fund future working capital, capital expenditures costs, acquisitions, debt service and other general corporate requirements, and dividends;
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| |  |  | require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to
fund working capital, capital
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expenditures, dividends and other general corporate purposes;

| |  |  | limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
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| |  |  | subject us to the risks that interest rates and our interest expense will increase;
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| |  |  | place us at a competitive disadvantage compared to our competitors that have less debt; and
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| |  |  | require us to comply with the financial and other restrictive covenants in our indebtedness, including, among other things, limits or restrictions on our ability to borrow
additional funds, make acquisitions, create liens on our properties and make investments. Failing to comply with those covenants could result in an event of default which, if not cured or waived, could have a material adverse effect on us.
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Despite current indebtedness levels, our subsidiaries, our
new lines of business and we may still be able to incur substantially more debt. In addition, our subsidiaries, our new lines of business and we may be able to secure this additional debt with our assets, new business assets and the assets of our
subsidiaries. This could further exacerbate the risks associated with our substantial leverage.



Our subsidiaries, our new business lines and we may be able to incur substantial additional indebtedness in the future. The terms of our current debt obligations do not fully prohibit our subsidiaries or us from doing
so. At December 31, 2004, our Term Loan has an outstanding principal balance of $46.9 million, our Revolving Facility has an outstanding principal balance of $50.0 million and outstanding letters of credit of $9.7 million, and the Credit Facility
permits additional borrowings of up to $190.3 million. All of these borrowings are, or would be, senior to our $230.0 million 63⁄4% Senior Subordinated Notes. In addition, those borrowings are secured by all the capital stock of the subsidiary
guarantors. If new debt is added to our and our subsidiaries current debt levels, the related risks they and we now face could intensify.



In March 2005, we amended the Credit Facility, in part, to increase the separate sub-limit for standby letters of credit from $10.0 million to $75.0 million in
anticipation of possible increases in our bulk commodity and other business transactions, while maintaining the overall revolving credit facility borrowing limit of $250.0 million. Because of our presence in the petroleum and automotive aftermarket
industries, we may, from time to time, expand our business involving the purchase and sale of refined bulk petroleum and related products and commodity transactions, on a fixed or hedged price basis (bulk commodity) utilizing cash or
letters of credit issued by recognized financial institutions. We may enter into bulk commodity transactions with petroleum and other companies conducting business in several foreign countries. Commodity hedges would be secured by the underlying
commodity being hedged. Bulk commodity transactions may occur in the near future which may or may not become significant. While revenues could become significant, resulting profit margins could be affected by factors such as purchase price, sales
price, transaction, unrecoverable and other operating costs, and could be less than those on existing operations. Our bulk commodities operations are or will be subject to risks ordinarily experienced by any new business, risks ordinarily associated
with conducting business in foreign countries, as well as risks generally associated with petroleum products, commodities, hedging and similar transactions of this nature. The accounting for bulk commodity, including underlying hedge, transactions
can be affected by many factors, including contract terms, title transfer, settlement timing, underlying hedge terms and other transactional terms or conditions. Revenues and resulting profit margins, if any, could be reported on either a gross or
net basis depending on the underlying transactional terms and conditions. Depending on settlement timing and other transactional factors, accounts receivable, inventories, liabilities, and outstanding letters of credit could significantly increase
during and between reporting periods. At this time, management is unable to determine if or when bulk commodity transactions may commence or whether resulting revenues could be material or profitable.



To service our indebtedness, we will require a significant amount of cash. Our ability to
generate cash depends on many factors beyond our control.



Our ability to
make payments on and to refinance our indebtedness, to fund anticipated cash dividends on our common stock, and to fund planned capital expenditures will depend on our ability to generate cash in the future. This, to a certain extent, is subject to
general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.



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Restrictions imposed by terms of our indebtedness could limit our ability to respond to changing business and economic
conditions and to secure additional financing.



The indenture for our
63⁄4% Senor Subordinated Notes restricts, among other things, our and our subsidiaries ability to do any of the following:



| |  |  | incur additional debt;
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| |  |  | pay dividends or make distributions;
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| |  |  | incur liens;
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| |  |  | make specified types of investments;
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| |  |  | apply net proceeds from certain asset sales;
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| |  |  | engage in transactions with affiliates;
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| |  |  | merge or consolidate;
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| |  |  | restrict dividends or other payments from subsidiaries;
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| |  |  | sell equity interests of subsidiaries;
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| |  |  | sell, assign, transfer, lease, convey or otherwise dispose of assets; and
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| |  |  | incur indebtedness that is subordinate in right of payment to any senior indebtedness and senior in right of payment to the Senior Subordinated Notes.
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The Credit Facility contains more extensive and restrictive covenants than the indenture for
the Senior Subordinated Notes. In addition to covenants of the type described above, the Credit Facility requires us to maintain specified financial ratios and satisfy certain financial condition tests, as well as limits our ability to make
acquisitions, pay capital expenditures and make investments. Our ability to meet those covenants, financial ratios and tests can be affected by events beyond our control, and there can be no assurance that we will meet those tests. A breach of any
of these covenants would result in a default under the Credit Facility. If there were an event of default under the Credit Facility, the lenders could elect to declare all amounts outstanding, including accrued interest or other obligations, to be
immediately due and payable. If we were unable to repay these amounts, such lenders could proceed against the collateral, if any, granted to them to secure that indebtedness. If any senior indebtedness were to be accelerated, we cannot assure that
our assets would be sufficient to repay in full the senior indebtedness and our other indebtedness. The Credit Facility and the Senior Subordinated Notes indentures contain cross-default provisions.



As a result of these covenants, our ability to respond to changing business and economic
conditions and to secure additional financing, if needed, may be significantly restricted. We may be prevented from engaging in transactions that might otherwise be considered beneficial to us. Should we pursue further development and/or acquisition
opportunities, the timing, size and success as well as associated potential capital commitments of which are unknown at this time, we may need to raise additional capital through debt and/or equity financings. There can be no assurance that adequate
debt and equity financing will be available on satisfactory terms or will be permitted under the covenants of the indenture or the Credit Facility. Any such failure to obtain further financing could have a negative effect on our business and
operations.



Liability for personal injuries and product liability claims
could significantly affect our financial condition and results of operations.



Motorsports can be dangerous to participants and to spectators. We maintain insurance policies that provide coverage within limits that are sufficient, in managements judgment, to protect us from material financial loss due to
liability for personal injuries sustained by persons on our premises in the ordinary course of business. In addition, our insurance premiums have been increasing. See Managements Discussion and Analysis of Financial Condition and Results
of OperationsNear Term Operating FactorsInsurance Coverage. Nevertheless, there can be no assurance that such insurance will be adequate at all times and in all circumstances.



For instance, on May 1, 1999, during the running of an IRL Series racing event at LMS, an
on-track accident occurred that caused race debris to enter the spectator seating area. Also, on May 20, 2000, near the end of a NASCAR-sanctioned event hosted at LMS, a portion of a pedestrian bridge leading from its track facility to a parking
area failed. In excess of 100 people were injured to varying degrees. These matters resulted in multiple lawsuits being filed against SMI, LMS and others. These matters reached resolutions or will reach resolutions that we do not believe had or will
have a material adverse effect on our financial condition or future results of operations. Nevertheless, we cannot assure you that the outcome of future incidents causing personal injuries to persons on our



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premises will reach resolutions that do not have a material adverse effect on our financial condition or results of operations.



Changes in income tax laws could adversely affect our financial condition and results of
operations.



At December 31, 2004, net deferred tax liabilities totaled
$186.9 million, including deferred tax assets of $27.5 million. These net deferred tax liabilities will likely reverse in future years and could negatively impact cash flows from operations in the years in which reversal occurs. Management believes
realization of the deferred tax assets is more likely than not and no valuation allowance has been recorded. However, changes in tax laws, assumptions or estimates used in the accounting for income taxes, if significantly negative or unfavorable,
could have a material adverse effect on amounts or timing of realization or settlement. Such effects could result in a material acceleration of income taxes currently payable or valuation charges for realization uncertainties, which could have a
material adverse effect on our financial condition or future results of operations.



Environmental costs and land use laws may negatively impact our profitability and growth.



Solid waste landfilling has occurred on and around the property at LMS for many years. Landfilling of general categories of municipal solid waste on the LMS property ceased in 1992. However, there is one land clearing
and inert debris landfill currently being operated on the LMS property by a third party (LCID landfill). In addition, one LCID landfill on the LMS property was closed in 1999 and two other LCID landfills on the LMS property were closed
in 1994. LMS may allow similar LCID landfills to be operated on the LMS property in the future. Prior to 1999, LMS leased certain property to Allied Waste Industries, Inc. (Allied) for use as a construction and demolition debris landfill
(a C&D landfill), which received solid waste resulting solely from construction, remodeling, repair or demolition operations on pavement, buildings or other structures, but which could not receive inert debris, land-clearing debris
or yard debris. The LMS C&D landfill is now closed. In addition, Allied owns and operates an active solid waste landfill and gas-to-energy facility adjacent to LMS.



Portions of the inactive solid waste landfill areas on the LMS property are subject to a groundwater monitoring program and data is
periodically submitted to the North Carolina Department of Environment and Natural Resources (DENR). DENR has noted that data from certain groundwater sampling events have indicated levels of certain regulated compounds that exceed
acceptable trigger levels and organic compounds that exceed regulatory groundwater standards. DENR has not required any remedial action by us at this time with respect to such sampling results. In the future, DENR could possibly require us to take
certain actions with respect to groundwater that could result in material costs being incurred by us. In addition, we implement measures to address methane-related safety concerns prior to and during events at LMS.



We believe our operations, including the current and former landfills on our property, are in
substantial compliance with all applicable federal, state and local environmental laws and regulations. Nonetheless, if damage to persons or property or contamination of the environment is determined to have been caused by the conduct of our
business or by pollutants used, generated or disposed of by us, or which may be found on our property, we may be held liable for such damage and may be required to pay the cost of investigation or remediation, or both, of such contamination or
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. Changes
in federal, state or local laws, regulations or requirements, or the discovery of previously unknown conditions, could require additional expenditures by us.



Our development of new motorsports facilities (and, to a lesser extent, the expansion of existing facilities) requires compliance with applicable federal, state and local
land use planning, zoning and environmental regulations. Regulations governing the use and development of real estate may prevent us from acquiring or developing prime locations for motorsports facilities, substantially delay or complicate the
process of improving existing facilities, and/or increase the costs of any such activities. For instance, private litigants filed a suit, which ultimately settled in 2004 without a material adverse impact on SMI or IR, against Sonoma County,
California seeking to alter or revoke the countys permits granted to IR for IRs planned renovation and expansion on alleged environmental issues. A negative outcome in this matter could have adversely affected our planned expansion at
IR, which could have had an adverse impact on our ability to grow revenues at IR.



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Broadcasting of NASCAR races is important to us.



A substantial portion of our recent profit growth has resulted from a significant increase in our television revenues received from the
arrangements NASCAR has made with various television networks, which expire in 2006. NASCAR ratings may impact the renewal price for our television arrangements in 2006 as well as overall attendance at our events and sponsorship opportunities.



Potential adverse market price effect of additional shares eligible for
future sale.



The market price for our common stock could be adversely
affected by the availability for public sale of up to 31,796,000 shares held or issuable on March 14, 2005, including:



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|NUMBER OFSHARES OFCOMMON STOCK |  | MANNER OF HOLDING AND/OR ISSUANCE                                                                                                                                                                                                                                         
|                               | 
|29,000,000                     |  | Shares which are restricted securities as defined in Rule 144 under the Securities Act of 1933, as amended (the Securities Act) and may be resold in compliance with
Rule 144. These shares include those held by Mr. Smith, our Chairman and Chief Executive Officer.
|                               | 
|1,650,000                      |  | Issuable on exercise of options granted under the SMI 1994 Stock Option Plan. All such shares are either registered for resale under the Securities Act or may be resold in compliance with
Rule 144.                                                                     
|                               | 
|357,000                        |  | Issuable on exercise of options granted under the SMI 2004 Stock Incentive Plan. All such shares are either registered for resale under the Securities Act or may be resold in compliance with
Rule 144.                                                                  
|                               | 
|439,000                        |  | Issuable on exercise of purchase rights granted under the SMI Employee Stock Purchase Plan (the ESPP). All such shares are registered for resale under the Securities
Act.                                                                                              
|                               | 
|350,000                        |  | Issuable on exercise of purchase rights granted under the Speedway Motorsports, Inc. Formula Stock Option Plan. All such shares are registered for resale under the Securities
Act.                                                                                       



The 1994 Stock Option Plan expired by
its terms on December 21, 2004. The SMI Board of Directors adopted a new 2004 Stock Incentive Plan that was approved by stockholders (the 2004 Plan). At December 31, 2004, no further options can be granted under the 1994 Stock Option
Plan. Approval of the 2004 Plan, and termination of the 1994 Plan, did not adversely affect rights under any outstanding stock options previously granted under the 1994 Plan. Awards under the 2004 Plan may be in the form of incentive stock options,
non-statutory stock options or restricted stock.