We capitalize Dover’s free cash flow at a discount to the current free cash flow yields of its two larger peers, ISCA and TRK, which are currently yielding about 6.2% and 7.5%, respectively, on the same basis.  Dover is a much smaller company than its two peers, relies on two major racing weekends for all of its cash flows, and has a rocky history with minority shareholders, so we think the valuation discount is warranted.

 

 

This investment opportunity exists due to a confluence of factors.

 

First, we believe there is a widespread misunderstanding of the implications of the closure of Nashville.  On August 2, 2012, the day prior to Dover’s announcement of the closure, the company’s common stock closed at $1.82 per share.  At the end of August, the stock closed at $1.44 per share, a 21% decline, and at the end of September, the stock closed at $1.25 per share, a 31% cumulative decline.  We were surprised by this reaction since the closure is certainly a positive development.  The following issues are at play:

 

- Many people assume a shrinking business is a negative.  However, Nashville was consistently unprofitable and had virtually no chance to become profitable without procuring a Sprint Cup date, a possibility that was clearly off the table.  It is unquestionably a positive for shareholders that the company will no longer waste shareholders’ resources there.

 

- In October, Dover reported in an SEC filing that it had incurred a $15.7 million non-cash impairment charge related to the write down of Nashville.  The company’s subsequent 10-Q filing indicated the property had previously been carried on the books at $46.0 million and was written down to $30.3 million, the company’s appraisal of the approximately 1,400 acres of land associated with the property.  The impairment charge certainly appeared to be bad news; after all, the $15.7 million impairment charge amounted to 36% of the company’s market capitalization and 28% of its GAAP book value at the time.  However, the company’s market cap and book value were, and are, both substantially below intrinsic value, primarily due to the fact that Dover does not carry any value on its books for its sanctions to host two Sprint Cup races.  That tremendously valuable asset is not treated as an asset for accounting purposes, so the $15.7 million write-down is not nearly as meaningful to the company’s value as this headline made it appear.

 

Additionally, the losses sustained by this facility over the years had already made it clear that this facility had no value to Dover as a going concern.  The impairment charge was  only the recognition for accounting purposes of what most interested parties had already recognized for some time.

 

- The closure of Nashville also brought the issue of a previously off-balance sheet contingent obligation to the forefront.  A review of some history is in order.  In August of 1999, Dover broke ground on its construction of Nashville Superspeedway.  In September of that year, the Sports Authority of Wilson County, Tennessee issued $25.9 million in Variable Rate Tax Exempt Infrastructure Revenue Bonds to build local infrastructure improvements to benefit the facility.  Since then, required debt service payments on the bonds have been paid from sales and property taxes generated from the facility.  Technically, the bonds have been an obligation of the Sports Authority, so were not recorded as a liability on Dover’s balance sheet.  However, with the halt of major racing at the facility this year, Dover estimates that the existing sales and property tax fund maintained by the Sports Authority will exhaust itself in 2021.  At that point, Dover will be responsible for the payments, which led the company to record an on-balance sheet liability representing the estimated present value of its obligation.  That amount is $2.25 million and was brought onto the balance sheet in the third quarter of last year.

We believe there may be some confusion about this topic.  For as long as it owns the property, Dover will continue to pay property taxes, which are contributed to the property and sales tax fund.  This expense is included in Dover’s general and administrative expense and explains why the tax fund will be sufficient to meet debt service payments until 2021.  We were actually encouraged by the small present value of the obligation, considering the remaining face value of the bonds is about $20 million.

- Finally, the closure of Nashville frees up this property for sale.  The racetrack itself is located in Lebanon, Tennessee, about a 40 minute drive east of Nashville, and is situated on approximately 1,400 acres of owned land in Wilson and Rutherford counties.  After the recent impairment charge, Dover’s appraisal of the land value was revealed to be $30.3 million.  To better understand this property and its value, we spoke with several commercial real estate brokers and investors in the greater Nashville market.  Our conversations led us to conclude that it is possible the property could be sold for $30 million, but a lot depends on the buyer and potential future use of the property.  Two contacts suggested a “fire sale” in the near term would likely fetch no less than $10 or $12 million.[3]

Considering Dover’s current market capitalization and implied enterprise value are $45 million and $77 million, respectively, we believe this property is a substantial hidden asset.  The sale of this property for $10 million would provide the means to immediately pay down more than one-third of Dover’s outstanding debt on its revolving credit facility, which would further deleverage the balance sheet and could lead to a reinstatement of the dividend.

The obligation to bridge a potential future shortfall in the sales and property tax fund could make finding a buyer for the property more difficult.  However, to the extent a new owner generates sales taxes, it is possible that taxes would be sufficient for debt service payments through the life of the bonds, in which case the new owner might never be required to bridge a future shortfall.

Second, we believe a perception may exist that Dover is more leveraged than it actually is and that there may be liquidity risk if business conditions weaken.  We do not share this concern.  The recent restructuring activities that are likely to increase cash flows, coupled with the debt reduction achieved over the last year, have changed Dover’s capital structure from highly leveraged to only moderately leveraged.  Specifically, the company’s current net debt, including the bond obligation, is between 1.9x and 2.4x our estimate of this year’s EBITDA.  Assuming management allocates this year’s free cash flow to debt reduction, the ratio would drop to between 1.3x and 1.6x later this year.  Dover’s credit agreement is even more forgiving, defining debt as debt net of the availability on an undrawn letter of credit, which means the leverage ratio for covenant purposes is currently below 1.0x, comfortably below the 3.25x covenant.

Additionally, Dover’s overall cash flows are more insulated from macroeconomic weakness than we think most people assume, as a result of the contractual net broadcasting revenue.  Several years of declining topline revenues, which are mostly a result of exiting the Midwest racetracks, may reinforce this misperception.

As opposed to being overleveraged, we actually believe Dover could be underleveraged within the next year or two.  This could put the company in a position to reinstate its dividend in the not so distant future.  Management suspended the dividend in mid-2009 to conserve cash, but is likely to give strong consideration to a reinstatement given that insiders own roughly 50% of the equity.

Third, Dover’s largest outside shareholder sold its entire 2.3 million share position over a brief period in October, November, and December.  For perspective, DVD’s average daily trading volume during the prior twelve months was about 15,200 shares, which would imply the position represented about 153 days of typical trading volume.  Yet, based on the public filings, this entire stake was sold over just 28 trading days.  Not surprisingly, this intense selling put tremendous downward pressure on the stock price late last year.  While we are not privy to this shareholder’s reasons for selling its stake, we are confident the reasons are benign as it relates to the company’s intrinsic value.  Our view was reinforced when Dover’s Chairman began to aggressively buy the stock personally at the same time we were adding to our position.

Fourth, in November, Dover received notice from the New York Stock Exchange (“NYSE”) that its stock was at risk of being delisted due to its market capitalization and book value both being below minimum continued listing standards.  The company had until December 19^th to submit an 18-month plan to the NYSE showing how it would regain compliance.  This headline created considerable uncertainty for some investors because a delisting could reduce the liquidity of the stock.

We felt this risk was overblown, because we thought this year’s cash flow improvements were very likely to lead to an increase in the market capitalization back to at least minimum listing standards.  We felt Dover’s 18-month plan would clearly show this and thus, the plan would be accepted by the NYSE.  Further, we felt a delisting would only have been temporary for the same reason, if it were to have occurred at all, and it would not have impacted the stock’s intrinsic value.

Recently, on January 23^rd, Dover announced that its 18-month plan to regain compliance was accepted by the NYSE.  We now consider this issue resolved, although a “delisting stigma overhang” may still exist.

Fourth, and finally, Dover’s equity trades in relative obscurity due to its very small size.  The company’s market capitalization is only $45 million, only half of which is represented by its publicly-traded class of shares.  A public float of only $22 million is simply not investable for the vast majority of institutional investors, so relatively few people take the time to follow and understand the company.  We believe this lack of attention can contribute to potential mispricings.

The Private Market Value of Sprint Cup Dates

Our investment thesis is primarily based on free cash flow, but a discussion of Dover would not be complete without a review of the private market value of Sprint Cup dates.  ISC and SMI have been consolidating this industry for years, so several transactions have occurred that provide some insight.

Exhibit 4: Historical NASCAR Racetrack Transactions

 

Among the transactions for racetracks that host Sprint Cup racing, the average transaction value has been about $150 million per date.  We believe slashing that to the $75 million to $100 million range would be a sufficiently conservative assumption to factor in today’s weaker economic environment.  That would imply Dover International Speedway, with its two Sprint Cup dates, could be sold for between $150 million and $200 million.  That represents roughly 6x to 8x the incremental EBITDA that we believe would accrue to either ISC or SMI under their larger scale, more efficient cost structures.  Both companies’ enterprise values are trading within this EBITDA multiple range, so this valuation range is certainly reasonable, in our view.

 

 

 

It is no secret within the industry that ISC and SMI have both been interested in acquiring Dover.  The two companies made a joint offer for Dover of near $6.00 per share in May of 2007, an offer that was rejected as inadequate.[4]  Executives from each company have publicly expressed interest several times.  Here are a few examples:

“Insofar as the remaining private speedways being available for sale, we have good contacts with all of the owners and we’ve certainly expressed interest if they have any interest in making a change, but to our knowledge there’s nothing brewing.”  Bill Brooks, current CFO of SMI, on 4/27/05

“You never know.  When these things happen, they happen fast.  But, like Bill said, we have to keep our communications open and we are on top of it…  We talk to people involved.  But it has been our observation in the past, whether Sears Point, Bristol, Atlanta, any of the tracks that we have purchased or have been purchased — when it happens, it happens fast and it is fairly sudden.  But that’s why we stay in contact.  So, who knows?”  Humpy Wheeler, former COO of SMI, 4/27/05

“I’m interested in any lucrative business that is for sale.  I enjoy — we buy a lot of companies.  I’ve bought probably 300 or 400 companies in my time.  And if it’s lucrative, and it’s for sale, and if we negotiate — yes, I’m interested.  That kind of answered your question.”  Bruton Smith, Chairman of SMI, 11/2/07, on whether he would be interested in buying Dover, Indianapolis, or Pocono

“If…. there is some transaction available with one of the other companies that has Sprint Cup racing, then we will certainly look at it.  I think it is pretty clear we’re on record that we would be interested in looking at either Pocono or Dover.” Bill Brooks, current CFO of SMI, on 11/5/08

“Well, we've been in discussion with the chairman of [Dover] for several years. And when we were focused just on the motorsports component of that business, we never could come to an agreement on price… But we also believe it is still -- just the Motorsports piece of that business is challenged by some of the other properties that they have. It's a real drag on cash flow. And so it doesn't preclude us from taking a look at it in the future, especially with a gaming partner. But we've just not been able to come to an agreement with price with those folks.”  John Saunders, current President of ISC, on 9/29/10

“[We are] interested in the assets and in the properties, but that means at a price that makes sense for ISC and its shareholders.  And in the past, we’ve had discussions with the Dover folks from time to time.  We have an ongoing dialogue.”  Dan Houser, current CFO of ISC, on 9/29/10

While this investment thesis does not rely on a change-in-control transaction occurring, we believe it is strengthened by the fact that one could occur and if so, it would occur at a substantial premium to the current stock price.  It is certainly debatable whether management and the board want to sell the company and they control the decision through control of the supervoting Class A shares.  However, a transaction at a fair price would likely create valuable synergies for both companies’ shareholders.  Additionally, to the extent the transaction is paid for with ISCA or TRK shares, it would allow current Dover shareholders to participate in a future economic recovery and potentially higher broadcast revenue down the road.

NASCAR Media Rights

Speaking of broadcast revenue, we believe Dover’s profitability and free cash flow have the potential to increase meaningfully in 2015 and beyond as a result of NASCAR’s next broadcast rights contracts.  Let’s begin with the history.

In 1999, for the first time, NASCAR consolidated the rights to negotiate broadcasting deals with the television networks.  Prior to that year, each race promoter would independently negotiate broadcast rights deals for its races.  This change increased the sport’s bargaining power and put it on the same level as other major sports, leading to a sharp increase in the value of NASCAR television broadcasting rights.  In November of 1999, NASCAR signed a six year $2.4 billion deal with Fox Sports, NBC, and Turner Sports to broadcast all Sprint Cup (then Winston Cup) and Nationwide (then Busch) Series racing on Fox, FX, NBC, and TNT.  This watershed deal roughly quadrupled the sport’s average annual broadcasting revenue.

On December 7, 2005, NASCAR announced the terms of its next broadcast deal, which would go into effect with the 2007 season and last through the 2014 season.  The new deal was an eight year $4.48 billion agreement with Fox, ABC/ESPN, TNT, and SPEED and represented an increase in the average annual broadcast revenue of 40% compared to the prior six year contract.

Since this contract was signed, NASCAR’s ratings and viewership have stumbled.  In 2006, almost 7.9 million viewers tuned in to the average Sprint Cup race.  By 2011, that figure declined to just under 6.5 million viewers — an 18% decline.  Several reasons have been cited by NASCAR observers that could explain the decline in the television audience, including the move of more races to cable from broadcast television, certain competition stifling rules and regulations, relatively unexciting racing, Jimmie Johnson’s five consecutive championships, the strength of the NFL broadcasts that begin in September, competition with the once-every-four-year World Cup and Winter Olympics, both of which occurred in 2010, among other reasons.

NASCAR has responded to the decline in several ways.  It implemented what has come to be known as a “Boys, have at it” approach to racing, which was meant to encourage more passionate rivalries and storylines.  Certain rules and regulations have been changed, including the implementation of double-file restarts, certain adjustments to address bump-drafting at certain tracks, and the return of the traditional rear spoiler.  The point system was simplified and a wildcard element was added to the Chase for the Sprint Cup, NASCAR’s postseason.  Start times for races held in September through November were moved from 1:00 pm ET start times to 2:00 pm ET or 3:00 pm ET start times to avoid going head-to-head with the NFL’s 1:00 pm ET start times.  Other changes have been implemented as well.

Collectively, something appeared to work in 2011.  The 2011 NASCAR season saw the first year over year increase in ratings and viewership since the multi-year slide began, as average viewership for Sprint Cup racing rose by 8%, according to the Sports Business Journal’s analysis of Nielsen data.  Importantly, viewership among the highly coveted 18-34 male demographic rose 17% versus 2010.

Exhibit 6: NASCAR Sprint Cup Average Viewership Per Race, Per Year

While television viewership is still below the levels seen when the last contract was signed, we believe the next contract with the networks is likely to result in an increase in average annual broadcast fee.  This may seem counterintuitive, but we believe three primary reasons exist that are likely to cause this result.

First, sports media rights are in a powerful secular bull market.  Over the last several years, consumers have benefited from an increasing array of alternatives to traditional network television viewing, including delayed viewing via the use of digital video recorder (“DVR”) devices, more cable television channels, on-demand and streaming content, social networking, smart phone and tablet use, and general web surfing.  These alternatives have intensified the competition for viewers’ attention, which has put pressure on ratings for the broadcast networks, whose business models are based primarily on ratings and the sale of advertising.  With fewer viewers, and fewer viewers who actually watch the commercials rather than fast-forward them, broadcast networks are increasingly seeking out sports content, which viewers strongly prefer to watch live.  Sports content tends to generate reliably good ratings and the tendency for live viewing means consumers are watching the commercials, enabling networks to charge higher sums for advertising.

Cable networks, notably ESPN, are increasingly being forced to pay up for content as the sports land grab has intensified.  Other parties have joined the fray, as well.  Comcast, which acquired a majority stake in NBC Universal last year, is seeking out more sports content for its NBC Sports Network, which was rebranded from Versus earlier this year.  News Corp’s Fox is seeking out more sports content for both its broadcast channel and its FX cable channel, while Turner appears to be doing likewise with TNT and its truTV network.  Additionally, the streaming of live sports over mobile devices and tablet computers, known as the “TV Everywhere” concept, is gaining traction and further increasing the value of sports rights.

These dynamics have caused the value of sports rights to increase almost regardless of the strength or weakness of the ratings.  For example, ESPN recently agreed to pay about $15.5 billion or about $1.95 billion per year for the rights to air Monday Night Football from the 2014 season through the 2021 season.  This is a 76% increase over the $1.1 billion average annual rights fee that ESPN and the NFL agreed upon in 2005.  While NFL television ratings have been very strong, they have certainly not increased by 76%.

Wimbledon illustrates the other side of the coin.  It was recently reported that ESPN outbid Fox and NBC and agreed to pay about $480 million or $40 million per year for the rights to broadcast Wimbledon in its entirety from 2012 through 2023.  This is a 74% increase in the total average annual fee that NBC ($13 million) and ESPN ($10 million) reportedly agreed to pay the All England Club under their current deals.  Yet, ratings for Wimbledon have plummeted since NBC signed its deal in 2007.

Exhibit 7: Wimbledon Finals Television Ratings and Viewership

Clearly, even a horrendous decline in ratings did not deter ESPN from paying dramatically higher fees for Wimbledon content.  As for NASCAR, its ratings and viewership remain below the levels seen during the signing of the last broadcast deal; however, the 18% cumulative decline in viewers over that period is not nearly as severe as the 26% and 29% declines that Wimbledon has endured — declines that earned it 74% more per year from ESPN.

The NFL and Wimbledon are not the only sports benefiting from this secular trend.  In April of last year, NBC and Versus (now the NBC Sports Network) outbid ESPN and agreed to pay an average of $187 million per year for NHL broadcast rights, more than doubling the $76 million per year the league had been receiving.  In 2010, the Atlantic Coast Conference’s television rights deal with ESPN was worth $155 million annually, more than double its prior annual average.  Last year, the PAC-10 recently signed on with ESPN and Fox at $250 million annually, more than four times the value of the prior deal.  Shortly afterwards, the Big East turned down an offer from ESPN that would have nearly quadrupled its annual rights fees in order to hold out for a higher offer.  According to published reports, Time Warner Cable agreed to pay an average annual fee of $200 million to secure the local media rights to the Los Angeles Lakers.  This was more than triple the $60 million per year that Fox Sports Net and KCAL9 had previously been paying the Lakers.  While financial terms were not disclosed, recent rights fees deals for the PGA Tour and USTA U.S. Open also saw increases.  Countless other examples exist.

In light of this trend, we believe NASCAR is well positioned.  NASCAR remains the second-most watched sport, per event, on television.  One motorsports industry insider rhetorically asked us, “Besides football, where else can the networks get a 4.0 rating?”  NASCAR fans are more brand loyal than fans of any other sport, which results in very high levels of corporate sponsorship and advertising interest.  For these reasons, we believe the secular tailwind in favor of higher sports broadcast rights fees will trump the lower viewership data as a factor in the upcoming negotiations.

Second, the next broadcast rights deal is likely to include greater value for NASCAR online and digital content.  This has come to be known as the “TV Everywhere” concept.  Recent sports rights deals for both the NFL and the PGA provide for such a digital platform, citing increased usage of tablet and mobile devices.  Not to be left out, in January, NASCAR announced a restructuring of its digital partnership agreement with Turner Sports that would provide the sanctioning body with exclusive operational control of its interactive, digital, and social media rights beginning in 2013.  On ISC’s fourth-quarter results conference call, held on January 26^th, John Saunders, ISC’s President, referred to this restructuring as “the right move for NASCAR to remain in a strong negotiating position that allows us to maximize the terms of the next broadcast rights fee agreement.”

Third, while NASCAR viewership remains below 2006 levels, the trend turned positive in 2011 as fans saw an increasing amount of drama and excitement.  The 2011 season began with a bang as a relatively unknown Trevor Bayne, at 23, became the youngest driver to ever win Daytona.  Throughout the season, several of NASCAR’s rule changes led to more competitive and exciting racing, as evidenced by a record number of average lead changes per race, different leaders per race, and total passes.  18 different drivers won Sprint Cup races, including five first-time winners.  The season champion was not determined until the last race of the season, a very unusual occurrence, at ISC’s Homestead-Miami Speedway.  There, Tony Stewart edged out Carl Edwards in dramatic fashion to claim both the race victory and the season championship.  This race was the highest-rated Sprint Cup race ever broadcast on ESPN.  For the season, Sprint Cup viewership was up 10%, according to company executives, and was up 17% among the important 18-34 male demographic.

There are reasons to be optimistic that the momentum could continue this year.  2011’s thrilling finish appears to have created more “buzz” around NASCAR than in prior years.  Danica Patrick will be competing in all Nationwide races and a portion of Sprint Cup races this year, which should generate increased fan interest.  Tony Stewart’s dethroning of Jimmie Johnson as the Sprint Cup champion should also increase interest among those fans who had grown tired of Johnson’s victories year after year.

In some respects, the trend in the television audience is more important than the recent absolute level, considering the multi-year nature of contracts.  Simply put, it is a much easier sell when ratings are going in the right direction.  In any case, a potential increase in the average annual value of the next broadcast contract would be material for Dover due to the very high incremental margin associated with higher broadcast revenue.  We do not include this potential in our valuation, but view it as a free call option.

 

We consider Dover’s common stock a great investment at its current price and have allocated a substantial amount of our capital to it.  With the streamlining of the business this year, Dover will finally be operating Dover International Speedway exclusively, which will finally allow its cash flows to fully accrue to shareholders.  Between the free cash flow generated from operations and proceeds from the potential sale of Nashville, we believe Dover could pay off the majority of its debt this year.  That would make the company substantially underleveraged for the first time in years.

While management and the board may not be interested in selling the company at this point, we believe insiders would prefer to receive a dividend again.  We would not be surprised if the dividend is reinstated sometime over the next year or two, which we believe would act as another catalyst for the stock price.  Additionally, the next media rights deal and a potential sale of the company remain longer term potential catalysts for shareholders.  In sum, we believe Dover is a great investment at its current price, even if only based on near-term free cash flow, yet there are many other “ways to win” over the longer term, as well.

U.S. Economic Weakness — Dover’s business is vulnerable to weakness in the U.S. economy and/or consumer spending.  Weak attendance trends at its two Sprint Cup weekends could continue.  Promotional ticket pricing could negatively impact admissions revenues.

NASCAR Television Ratings — The recent positive momentum in NASCAR television ratings may not continue.  If television ratings decline this year and/or next year, it would act as an incremental negative for the upcoming negotiations of the next broadcast contract.

Weak Corporate Governance — Dover’s management team and board of directors have overseen the company during a period of tremendous shareholder value destruction.  The company sustained significant losses investing in and operating its Midwest racetracks.  Additionally, an attempted merger with Dover Downs, which shares the same board and management team, at no premium did not have minority shareholders’ interests in mind.  The company has poor shareholder communication, which is most clearly illustrated by their elimination of the question-and-answer portion of investor conference calls a few years ago. 

 

However, we are encouraged by the Midwest closures, which began in 2009.  While these racetracks could have been closed sooner, we are pleased that management has followed through and is now on the cusp of maximizing free cash flow.  Additionally, 50% insider ownership should ensure an alignment of interests with minority shareholders over the long-term.  Recent insider buying at prices not far from the current share price is also encouraging.

NASCAR/ISC Ownership — ISC is majority-owned by the France family, which also controls NASCAR.  Conflicts of interest could arise.

NASCAR Sanctions — Dover does not own the right to host its two Sprint Cup dates, but instead, is granted annual sanctions by NASCAR.  NASCAR is under no obligation to renew its sanctions.  However, we do not consider this a serious risk.  First, Dover has been granted NASCAR sanctions for 42 consecutive years and sanctions to host its two Sprint Cup dates since 1971.  We are not aware of NASCAR stripping Sprint Cup dates from a race promoter.  Second, ISC has long been an industry consolidator, having acquired several racetracks that had NASCAR sanctions to host Sprint Cup dates.  The fact that ISC, majority-owned by the France family, has a long history of spending hundreds of millions of dollars acquiring Sprint Cup dates, as opposed to simply trying to have NASCAR grant them to it, indicates to us that NASCAR respects its sanctioning traditions.

Weather — Dover’s two Sprint Cup weekends are outdoor events that rely on clear weather.  Rain can delay or postpone the event, which can hurt admissions and event-related revenue.  The forecast of rain can also negatively impact admissions and event-related revenue.

Disclosure: Long DVD.

This is not a recommendation to buy or sell any security.  Please rely upon your own work.

 

 

[1] Event-related revenue includes sponsorship fees, luxury suite rentals, hospitality tent rentals, catering, concessions, souvenir sales, vendor commissions, program sales, track rentals, and other event-related revenue.

[2] Dover announced plans for a seat widening project that will begin this year with a goal of completion by 2014.  Management’s guidance for 2012 capital expenditures is “less than $500,000”, but management has not provided guidance beyond this year.  Based on our knowledge of similar projects at other racetracks, the project could cost very little or quite a lot, depending on its scope.  While the “less than $500,000” guidance for this year appears to imply it is a low cost project, to be conservative, we value the equity as if a very large capital outlay will be required in 2013.

[3] We do not believe Dover would owe taxes on this sale, considering the company has incurred substantial losses on this property.  The company has spent well over $100 million on this property between land acquisition costs, construction costs, and improvements.

[4] http://www.shareholderforum.com/dvd/Library/20090909_Dover-letter.pdf