NASDAQ-100 OPEN

April 4, 2004

Adam Barrett

Butch Buchholz

THE MODERATOR: Folks, I want to welcome you to our wrap-up press conference for the 2004 NASDAQ-100 Open. David Warren, the CFO for NASDAQ, to my far right. Butch Buchholz, Tournament Chairman and Founder. And Adam Barrett, Tournament Director. David, you can open up with some statements and then we'll turn it over to Butch.

DAVID WARREN: Thanks very much. Thank you, all. I'm delighted to be here today. As David said, I'm NASDAQ's Chief Financial Officer. I'm used to the hostile financial press, so this is a refreshing change of pace for me to be here dealing with what I've been told is a far more interesting and lively crowd. So I'm glad to be here (smiling). This year there are some significant anniversaries here, obviously. This is the 20th year for the tournament, but it's also the fifth year for the QQQ, that's the NASDAQ-100 tracking stock. As a tracking stock, the QQQ is the most actively exchange traded fund in the world. Over the last five years, we've grown to now $23 billion in assets, and we now have over one million investors who own shares of the QQQ. They have found it a very simple and efficient way to diversify their investment portfolio. Quite simply, if you own a share of the NASDAQ-100 tracking stock, the QQQ, you have ownership in the 100 companies that make up the NASDAQ-100. This tournament has, obviously, a very, very visible and very great platform for NASDAQ and for our NASDAQ-100 companies. When you think of the reach that this tournament has in 160 countries, and the great popularity, the rising popularity that tennis is enjoying in the country, in the US and all over the world, tennis is now an active part of the lives of people who are customers and investors in many of the NASDAQ-100 companies. So it's been a great opportunity for NASDAQ. Specifically, I want to thank a couple of the companies that have been very active in this year's tournament. Those are Apple, Microsoft, Jet Blue, Scholastics and Starbucks. Again, this has been a great opportunity for them to reach their investors and customers, and we really thank them for their active participation this year. We've also, this year, I think significantly been able to draw more financial press, financial community, to this tournament. The World Series of Exchange Traded Funds, the largest event of its kind in the world, this year changed both the date and location of their annual conference to coincide with this tournament. They were here for the first weekend of that, and I think that's just a very significant statement on their part as to what the NASDAQ-100 tournament is all about. Lastly, I think, as I turn it over to Butch, I'd like to, on behalf of NASDAQ and all the NASDAQ-100 companies, I'd like to thank you for your vision and for your very inspired leadership of this tournament over the years. You've put it on the map, and we're happy to be a part of it with you.

BUTCH BUCHHOLZ: Thank you. Well, David, we're obviously very grateful to NASDAQ and all your support. It takes a whole year to really put something like this together. It is teamwork. Adam and his staff and the people at NASDAQ have helped grow this event. We will welcome all the Microsofts and Starbucks and stuff that you want to send us, we'll be very grateful for that, too (laughter). I think it's maybe significant just to kind of look back over the 20 years and sort of see where the tournament's gone. We're going to give everybody this. It blows my mind to see that our prize money has gone from 1.8 to 6.5; 1985, we were 1.8. The winner's check that day was $112,000. It's over half a million now. Our total attendance the first year, we were at 14 days, was 125,000. We're going to hit 252,000 or more. The countries that are represented were 33 versus 45 today. The number of media credentials we issued in '85 were 250. We now have 750. The countries represented from the media, we had 12 countries the first year; we have 32 now. I'm sure the Greater Miami Visitors and convention Bureau will be happy to hear about this, but the hotel room nights in the beaches in Miami are up 17 percent from last year, and in the Grove, Gables and South Miami, were up 29 percent. Out of 12 hotels that we've used, they're basically full. That's a major economic impact for this community, which means that people are now starting to travel again after 9/11. Couple other things... I always like this. We've sold 14,000 T-shirts; 8,000 hats; 20,000 hot dogs; 18,000 crepes; 17,000 Ben and Jerry's; 15,000 burgers; 13,000 pizzas; 6,500 shakes - I had one, I have two a year , I had one this year - six tons of french fries, and five tons of chopped salad. Let's see, what else is important here? Television. We have 57 hours of domestic television. We had the Tennis Channel, ESPN. ESPN2 did the men's semifinals live - that's a first. CBS is back to five sets this year's final. We had 42 networks around the world broadcasting to 156 countries, and that's 900 hours of coverage. So we got the NASDAQ name out there (laughter). We had two sell-outs. We had one on Saturday, Session Seven; and Sunday, Session Nine. It's been a great 20 years. I'm looking forward to the next 20. I want to turn it over to Adam. Adam really deals with the day-to-day responsibilities, dealing with the press - not the press - our staff, which I think are the best in the world. But I'm going to turn it over to Adam Barrett, our Tournament Director.

ADAM BARRETT: Thank you, Butch. One, first, I want to recognize, it takes about 3,000 people to run this event - 1,200 volunteers, 400 ballpersons, 600 to 800 concessionaire/vendor/independent contractors that come, 22 year-round people, about another 150 that we hire anywhere between two and six weeks, two months, three months, various times. They've all got to come together, and they've all got to get on the same page. Some are easy - 22 people year-round, you have year-round to get them on the same page. Others are here for two weeks. They're hired by probably five to seven different large staffing companies. Our challenge every year is to get them trained in what we call the "championship way." That is trying to bring service to our guests, to the fans, to the sponsors, to the players, and to the media to really make it the best place for everyone to do their job or enjoy the tennis. So that's our goal every year. I think this year our team has done an outstanding job of pulling all the different facets of this business together and really creating an entertainment vehicle for all of our guests. So we hope that the media has had a good experience, hope that the players have had a good experience, our sponsors have had a good experience, and the fans of South Florida. I would like to recognize the South Florida Miami-Dade County. This event, three years ago, was sold to IMG. It was founded in 1985 by Butch and Cliff Buchholz, but the real owners of this event are the men and women, the citizens of South Florida. They're our boss. They tell us what they like; they tell us what they don't like. If they don't like it, they'll come down harder on us than Butch could come on me, or IMG on us. So the real bosses out there are every day, when they walk up to our Guest Service Center, when they walk up to our Media Manager, when they walk up to our Player Service Manager, when they walk up to our Sponsor Managers, and they have either good comments or bad comments, that's how we steer, and that's who we're really taking the lead role in, in determining where this event needs to go. This event needs to continue to grow. It needs to continue to grow and get bigger and better. That's with the support of all the groups we talked about. This year we've had increased support from our fans with attendance being up this year two percent to five percent, which is great as a comeback after what was a tough year last year with all the activities going on around the world. Revenues are up for daily ticket sales, so more people are coming through the gates. Per cap numbers are up, which is very exciting. That says two things: One, hopefully it reflects the job that we're doing, but also reflects the economy in South Florida. Retail was up 18 percent. Food and beverage is going to be up somewhere between 7 and 12 percent, a little early still to tell because you have a lot of numbers, game day numbers that are still coming through for the final two days, and orders that have taken place in the last couple days. So it's very encouraging to see all the pieces coming together and the growth of the event continuing. So we have a vision out there that Butch started 20 years ago. Butch's vision is always five years ahead of where anyone in the tennis world is, and anyone within our tournament is. Our job is always to try to keep up with that vision. If we can get a little closer to five years away from his vision, then we're doing good. If we fall further away, we're not doing all that well. But the good news is that vision is always there and that vision is always growing to make this not only the best place for tennis, but a place for everyone to come together to really enjoy themselves, and an entertainment vehicle in South Florida.

BUTCH BUCHHOLZ: Questions?

ADAM BARRETT: I actually read the article. Actually, our Guest Service Center writes down every complaint or every suggestion or every comment that comes through Guest Services. Anything that gets communicated through the website goes through the appropriate department for follow-up. So if we get 100, there's 100 follow-ups. Every issue that's brought to our attention, there's a follow-up. Some things, we can do. Some things we can fix; some things we can't. You get things from "one of the bathrooms on the west side are dirty," and we will immediately send a team to make sure that, one, find out why it got dirty, it should never get more than -- we have attendants on staff to make sure they don't get dirty, to find out why, and then to get it immediately rectified and cleaned. Some are scheduling. Somebody will write in that they didn't like the fact that we didn't put enough doubles on Stadium Court. We'll go and talk to Guest Services and say, "Well, scheduling has to do with the ones that are going to draw the most fans to the appropriate courts." So if you have a fan that has 2,000 people that will attend on a 5,000 seat, then that should be moved. So we try to educate to try to get responses. Parking, which I think was what his major complaint was, is very challenging. We give our response, is we're on a key. There's not a lot of parking, and we try to do our best to accommodate everybody that wants to come. His complaint was they parked the back first, forward. That's in order to allow the quickest way to get people to the site. That's to keep the roads clear so when the buses leave, it goes straight through. He complained about some of the dust. We increased the size of the roads along the -- we had a new parking system put in place this year, because what we've used before, which was the old Virginia Key lot, is under construction. Once it's under construction, we weren't able to use that. Us and Dade County didn't find that out until about January. So we had to put together an entire new parking plan for up to 2,900 cars. There were some areas in which roads needed to be widened in order to get car and bus traffic through there. So there was some dust that did occur. However, it was probably a lot better solution than we've had in the past, because, one, the issue with the old lot was when it rained, it flooded. This, while there may have been some dust, they didn't flood. Our main concern was timing, and that is making sure that the time it takes for someone to park to the time they get to the event was not increased. That's what we worked on, and that's what we were very successful with. We immediately checked with Guest Services every day as well as the website comments to see if there were trends, if people were unhappy. We found out more people were happy with the new parking solution, as well as you can be with parking solutions in which you have to bus. If I had all my parking across the street and everyone would park and walk in, that would be great. But we do the best with what we're given. On a key, you are tight. So we watch it very, very carefully. If there's any trends and issues, we immediately follow up.

ADAM BARRETT: We'll continue to take a look at it. Anything that's screened is screened to keep back-of-the-house and front-of-the-house separate. We have a lot of back-of-the-house infrastructure - trucks, catering. There's five kitchens on site, there's plumbing, there's electrical, there's tenting. They're all set up. What you're trying to do is you're trying to keep a barrier, both a physical barrier as well as a visual barrier, between the front and the back of the house. We tried to make sure that the practice courts are visible so fans can watch. In fact, we have the Warsteiner sports bar out off the food court in which you could actually sit, eat, have a glass of Warsteiner and watch the players practice at the same time. That was set up specifically for that because there are a lot of fans. You could watch. Most of the practice courts are open - the ones in the back, E and F, I think you can watch C from one side and you can watch A and B from one side and possibly half of the other. I have to take a look at that, see which ones are set up. There is a lot of viewing of the practice courts, and we will continue to look at that. We did read that issue from a couple different people. Like everything else, we'll address it and try to find solutions. There's not always solutions. Once again, I do need to keep back-of-the-house and front-of-the-house separate because trucks and people don't mix.

BUTCH BUCHHOLZ: Well, I think we were a little unlucky this year. I think one of the pluses of having combined men's and women's events, when one side is weak, the other side sort of rises to the top. Larry Scott knows there's some issues in women's tennis, which he is committed to fix. So I think this year we were a little unlucky. There was also some issues of whether players were going to make commitments in Indian Wells and didn't think there was going to be a problem here, moved players to Indian Wells thinking they were going to play here, then they had all these injuries. If we have this conversation next year, I will be very surprised.

BUTCH BUCHHOLZ: Well, all I can tell you is I've spent some time with Larry Scott over the last 12 days. I think he's got the message.

BUTCH BUCHHOLZ: Yes, I think they're going to change the rules. Right now, it's best efforts. In fairness to the WTA, they have been some of our strongest supporters over the 20 years. Then again, I think this is a little bit of a blip. But, I mean, if we're here next year talking about this, then I think women's tennis is going to have a problem.

BUTCH BUCHHOLZ: I couldn't agree with you more. It's an issue that we have brought up to the ATP and the WTA. We're here; the players made the decision. We, the tournament, did not make the decision to change from Friday to Wednesday. That was a player decision which we said we'd be happy to do. But we have all the press, we could have more television. You're here and, you know, you don't have marquee names to report. We understand it 100 percent. There will be some additional cost to us, obviously some prize money. We do all the hotels and stuff like that, we'd have to put a pencil to it. But that would be an investment that I think would be good for tennis, good for both the ATP and the WTA because they have some more jobs. I think we'll have more spectators and do a better job for you all. It's something that we've certainly considered, and it would help the tournament.

BUTCH BUCHHOLZ: Larry's had a hard time getting 96 here this year (laughing). I think we should put that on the agenda very quickly. I wouldn't say it's impossible. Normally, these things take a little longer than we all...

BUTCH BUCHHOLZ: Yeah, absolutely. Absolutely.

BUTCH BUCHHOLZ: To be honest with you, I don't think so. In fact, I met with CBS this morning. We are going to snuggle up to CBS and the NCAA basketball, because it works perfectly for them; it's perfect for us. It's perfect that we can deliver to all of our sponsors, that we're going to have network television. So if they keep telling us it's 12 o'clock, then we're going to be at 12 o'clock. I know everybody needs to go. One just tiny little thing that I think really kind of endorses what Adam said, we are always trying to look to do something a little bit better. We know we're in the entertainment business. You all might not know this, but yesterday, we gave out 5,000 roses to every female that walked out of that front gate.

BUTCH BUCHHOLZ: You didn't walk out the front gate (laughing). We just said, "Thank you for coming to the NASDAQ." I think that's a first. I don't think anybody's ever done that in tennis.

BUTCH BUCHHOLZ: Do they do that? I thought we were the first (laughter). Philippe Chatrier. Thank you all for coming.