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January 9, 2008

David Fay

Tim Finchem

Steve Mona

BOB COMBS: Thank you very much, and ladies and gentlemen, welcome to the World Golf Foundation teleconference this afternoon. We very much appreciate your interest in attendance. We will have remarks by our speakers followed by a Q & A session. Our speakers include Tim Finchem, PGA TOUR Commissioner and the outgoing chairman of the World Golf Foundation; David Fay, the incoming chairman of the World Golf Foundation and the executive director of the USGA; and Steve Mona, CEO of the Golf Course Superintendents Association of America and the recently-named first-ever CEO of the World Golf Foundation. To kick it off, let me turn the program over to Tim Finchem.
TIM FINCHEM: Thank you, ladies and gentlemen, for joining us this morning. I will be very brief and turn it over to our new chairman. This call is really about just a status report on the World Golf Foundation as we go into a new direction, a new era for the foundation.
A lot of work has been done over the last couple years in planning for the future of the Foundation in an effort to create a global entity that can bring the world of golf together at some level to focus its attention on matters of mutual interest, whether it be entities from professional golf, the sanctioning bodies, the rule-making bodies, entities from Europe, Asia, around the world. And that is what we have attempted to do.
To do that, so far in '07 the board structure has been changed to include the Royal & Ancient Golf Club as well as the European Tour, and those entities join the United States Golf Association, the PGA of America, the LPGA, Augusta National and the PGA TOUR to form the executive committee of a newly-formed board of the World Golf Foundation.
In addition, the chair of the Foundation will now rotate among members of the executive committee, beginning this week with David Fay assuming the chair. And as well as Bob just mentioned, we have upgraded the overall executive talent at the Foundation. In addition to Joe Barrow, who has historically managed the First Tee effort, we also have Jack Peter who has been managing the World Golf Hall of Fame and Ruffin Beckwith who has been looking after Golf 20/20. Steve Mona will be leaving the Golf Course Superintendents Association in the first quarter to assume his duties as the first-ever CEO.
We think these changes are very helpful in terms of moving the Foundation toward becoming truly a global entity and an entity that represents the world of golf.
Obviously the areas that I just referred to, Hall of Fame, First Tee and 20/20 will continue, but as David will point out here in a moment, there will be some additional things added to that, including most recently the work that was done in 2007 by a subcommittee of the board to bring various golf organizations together on anti-doping policies, which have been subsequently announced.
We have a lot of work to do, but we're off to a good start. We think these developments bode well for our efforts in the future, and let me, with that, turn this call over now to David Fay, the 2008 chairman. David?
DAVID FAY: Well, thank you, Tim, and to all of you on the line, excuse my voice. It almost sounds as if I might have been campaigning the last week up in New Hampshire, but it's just because I have a cold.
I first want to commend Tim for everything he has done and will continue to do for the World Golf Foundation. Clearly without his vision and leadership in taking the World Golf Foundation, creating it, nurturing it and expanding it, he has by virtue of that, strengthened the structure, and it's in a better position to provide coordinated and frequently collaborative support to the mission that we all share in preserving and enhancing the fundamental well-being of the support.
Examples, and Tim cited one, anti-doping. When I think about the people who are now on the executive board, I think what happened in late 2007 and working in a collaborative way is something that benefits the entire game.
And also, it doesn't matter what discipline you're talking about. Often times people say, are these people talking to one another? And we do. But this more formalizes that process.
On the executive board we're now going to have a forum to success the big issues, big issues like anti-doping, big issues possibly like environmental impact, the global growth of the game. Who knows, maybe even something specific like golf and its role in the Olympics and certainly the economic impact of the game of golf.
But Tim has definitely put the W in the World Golf Foundation by reaching out and getting Peter Dawson and George O'Grady involved, and of course it's great to have representatives from the majors and the commissioner of the LPGA.
On the economic impact, I will admit that -- when I used the phrase golf industry in the past, sometimes I wondered if I was being absolutely accurate. Well, next week, and we're not going to talk too much about that now, but we're going to be releasing a new economic impact study for U.S. Golf, and it was conducted under the auspices of the Golf 20/20 initiative, and I have to tell you, when you see the results of this study, I imagine you're going to snap back and be very impressed with it because clearly golf is an industry and it's an industry that is helping in this particular instance the U.S. economy in a way that I really, truly didn't envision.
To expand on that, in April we'll be taking the message of golf's impact on the U.S. economy to Capitol Hill where a number of activities are being planned, including a First Tee Congressional breakfast and a variety of meetings with golf's leadership and key members of Congress.
Tim touched on the anti-doping. We are going to be establishing an anti-doping office in 2008, and under Steve's direction, we're going to be hiring an experienced executive to administer this over the next several months.
Tim mentioned the ongoing efforts of the First Tee under the leadership of Joe Barrow and the World Golf Hall of Fame under the leadership of Jack Peter and Golf 20/20 under the leadership of Ruffin Beckwith, and I think that these three programs are going to continue to do very good things for the game of golf.
And with all of this now on our plate, and probably it's a good thing when Tim's passing it over to me here, I may need adult supervision, because it's clearly time to bring in a full-time executive on board to guide the World Golf Foundation. We couldn't be more delighted with the selection of Steve Mona. Steve and I go way back, back when he was working for the Northern Cal golf Association. He and I were colleagues on the USGA staff for a while, and as many of you know, he's served as CEO of the Golf Course Superintendents since '93. I think just about his entire career has been spent in leadership positions within the golf industry.
But I'm very excited to be working with Steve. And again, I can't thank Tim enough for his vision and leadership. With that, I'll turn it over to Steve.
STEVE MONA: Thanks very much. I just wanted to make a few brief comments because pretty much everything that's been said has already been articulated very well by either Tim and/or David, but just a few comments from me. First of all, I want to convey how enthusiastic I am about assuming this role, and also for the prospects of the World Golf Foundation.
It's cliché often times to say that the sky is the limit, so I won't say that. But clearly there is a tremendous amount of opportunity, and I see where the World Golf Foundation can play a key role in the game of golf globally, and that's very appealing. In terms of the transition, Tim made reference to it, I am wrapping up at GCSAA and will be on board at the World Golf Foundation full-time sometime in March, although I have been ramping up quite a bit over the last several months and feel like I'm getting up to speed, although not yet running.
Both Tim and David talked about the current team, and I just wanted to make brief mention about how strong of a team already exists at the World Golf Foundation with Joe Barrow and the great job he's done with the First Tee, Jack Peter, similarly, with the World Golf Hall of Fame has done wonderful things. Ruffin Beckwith has been a stalwart with golf 20/20, so all those programs are in my judgment in very good order, and there are other members of the senior team at the World Golf Foundation that I'm very much looking forward to working with as we enter into a new era for the WGF.
Both Tim and David also spoke about anti-doping, and as David mentioned, we will be being looking to hire an executive to come into that role. We haven't worked out all the details yet, but we will be moving forward on that sometime later this year. And in terms of economic impact, the only additional statement I would make is for those of you that plan to be at the PGA show next week on January 17, I would commend that event to you in terms of your attendance.
So just to wrap up, I'll just wrap up with where I started. I view this as a tremendous opportunity. I can see the World Golf Foundation having great influence and impact on the game of golf on a global basis, and I'm looking forward to being part of the team.
And I thank Tim and David and the rest of the executive committee for having the confidence in me to place me in this role.

Q. Steve and David, in no particular order, whoever jumps in there, but what specifically do you think would be the most important priority as you guys begin your tenures in your positions?
STEVE MONA: Well, there's probably a couple different areas that need to be addressed right away. Obviously the whole anti-doping area, because that's new and it's something that is very visible and very high profile and very important to the image of the game. So I would rate that as a top priority.
And I would also say that the Golf 20/20 initiative also is one that I know will receive a great deal of focus and attention in the early days. We recently had a strategic planning meeting to talk about 20/20 going forward, where is it going to go, what's it going to look like. As you may know we did not have a conference in 2007 and we did that purposefully to take a step back and evaluate what we've accomplished and where we go from here.
So in terms of what I expect I'll be working on in the early days, I would point to those two, anti-doping and Golf 20/20.
DAVID FAY: I would think those would be the focal points, plus getting Mr. Mona a house down in Florida, too.
To what I said earlier about the W in the WGF, I believe, also, starting with Tim's decisions that we reach out and solicit more input from more of the golf leaders from around the globe because this is a global game, and when we're looking for the growth of the game, it's not just in the United States but it's worldwide.

Q. David, I've talked to people from players to executives and other governing bodies about the anti-doping thing, and I get a sense that everybody is almost eager to start this because they are very, very eager and they are very confident that the program will show that golf is a clean sport and will remain such. Do you put yourself in that category?
DAVID FAY: I certainly do, and I think when we're talking about the specifics of programs, the person at this point you should be speaking with would be Tim. The PGA has announced a policy, and also Carolyn. I'm delighted that we have a policy in place now. In a sense golf was -- it was that double-edged sword that we believe, and we believe passionately, at least I do, that golf is a clean sport, and now we're going to be able to provide evidence of that.

Q. Tim, can you just kind of bring us up to speed on the testing on your Tour in the States? I guess you're looking at July from what I've pieced together here and there from reading various things, and I guess the handbook has been distributed to the players and just sort of the baby steps you're going to be taking to get this thing on-line?
TIM FINCHEM: Basically the program goes into effect July 1, the program meaning that's when the rule goes into effect. That's when the players are subject to testing, anytime after July 1.
We have already engaged -- started the effort that you referred to of a seven-month education program, beginning with written materials. And then we have player meetings in San Diego, we have professionals out every week starting this week at Sony, meeting with and available to players. We have a 24-hour hotline. Our focus is to educate the players because honestly we think if we do that job we will not have a problem. The core value in the sport is too strong as it relates to following the rules. This is a complicated area, and players need to understand the substances that are a target of the rule and how to keep the substances out of their bodies.
As we look at our sports, there are those who have intentionally used substances and there are a lot of cases where there was unintentional use. So we're very eager in the education area, and then we'll start the program on July 1.

Q. In terms of professionals this week, drug counseling experts?
TIM FINCHEM: Yes, we have outside consultants -- we have an outside provider that will be doing our testing program, and we have outside professional consultants that we have made available to players to discuss with them what's on the list, how you know or what kind of substances you should be concerned about in terms of supplements, vitamins, other substances that might contain some of these things. We want to make our players familiar with those personnel resources and also get them used to the fact that there are a variety of ways available to them to get information.
In addition to that, we have mandatory player meetings scheduled for San Diego and again later in the spring where we will be getting in front of the players.
We're just not going to leave this to chance. We want to make sure every player is fully knowledgeable about the rule, the substances, and if a player gets into a situation where he is about to use a substance, how he can find out about that. So it's a lot of work, but we're going about it very aggressively.

Q. For Tim and Steve both, the plans that are out there, and I know mostly about PGA TOUR and LPGA's plans are similar but not the same. On a world level would you like to move more toward a unified plan where everybody is entirely on the same page? That would seem to be especially necessary if the Olympics once again become a consideration.
TIM FINCHEM: Well, I think that's two different things. Would we like in a perfect world for everything to be uniform? Probably yes. The variations are not significant, however, we don't think at this point. And they come about because the various organizations have gotten involved in this at different rates of speed, if you will.
The basic agreement or protocol that the various golf organizations have signed onto agrees on a de minimus list of -- it's a huge percentage of what's called the WADA list used in the Olympic games. So we're comfortable with where we are now.
Now, as we go forward and coordinate information on testing protocols, on the therapeutic use exemption area where players can get exemptions in certain ways, in research that's being done, and there will be more said about that in the next couple of weeks, research that's being done in the testing area, we will be comparing information, sharing information, and that may result in even a closer alignment. But right now it's fairly close to begin with.
Now, your second point about the Olympics, we don't think it's really relevant. We think if golf were to enter the Olympics, which comes about, as you know, seven years before the Games to which the sport would be added, you know, there is no problem at all with golf taking the steps that it may need to take to align its programs exactly with what is necessary for an Olympic involvement. It's just not a big issue.
As a matter of fact, we have every reason to believe that the basic alignment we have now may very well be the alignment that the IOC uses by the time we were to get into the Olympics, if ever, and that's a big question mark. We don't think that's a fundamental concern.
In the meantime we are closely coordinating our activities, and we think that's a very good step.

Q. Tim, I'm working on a story on the Wyndham Championship in Greensboro. Are you concerned at all that they still don't have a course? I know it's about eight months until that tournament is played. Isn't that getting kind of close to the gun there?
TIM FINCHEM: On this call I'd like to keep the focus on the World Golf Foundation issues and maybe get those questions directed more to David and Steve, but just quickly, we're not concerned. We're very comfortable with what's happening at Wyndham. We think that good progress is being made there, and we're looking forward to a resolution of that issue.

Q. My question is about the new anti-doping office. Where it will be? Will it apply to every organization that's involved? And in general terms, what will this office provide?
TIM FINCHEM: Well, I guess I should answer that one because our people have coordinated with the European Tour staff and the LPGA staff. That was the three-leg-of-the-stool committee that worked for the board of the World Golf Foundation in the summer and fall in this area, and this is a quick answer, but the Office of Doping is an office that would be created to support the activities around the world of the various Tours. These programs are in need of, A, communication back and forth in terms of what's happening; coordination of the process because we have players playing around the world, moving from Tour to Tour where the protocols and procedures may vary somewhat, particularly as it relates to testing.
In addition to that, it's important that now that we're in this arena, that we all stay educated and up to speed on developments with respect to new substances that are out there, new testing techniques, and more and more energy is going into those areas, not just because of historical practices but because sports are catching up with where the technologies are that relate to these areas.
So there is an ongoing research effort that needs to be coordinated. So it's very much a supportive coordination effort, the actual administration of the program; that is, educating the athletes, sometimes testing in a credible way. That is left to the individual Tours to coordinate on their Tours and to interface, if necessary, with the major championships.

Q. Tim, you mentioned that there were the outside consultants or there have been outside consultants and they're being made available to the players. The first part of that question is when were those outside consultants brought on and when were they made available, since what date?
TIM FINCHEM: They were retained during the calendar year of 2007, and they are being made available to our players every week on-site starting with the Sony Open this week in Hawai'i.

Q. Starting with the Sony?
TIM FINCHEM: Starting with the Sony, and they'll be on-site every week, at a minimum, through the end of June as we start the program July 1.
Now, how much they're on-site after that pretty much depends on how the program goes and what we see in terms of the education level of the players and the need the players feel like they have to having access to individuals. What we're hoping is that we can get the information out if the list changes or if testing protocols change or the rest. But we'll take it one step at a time. Our major focus is to get all the players at a point where they're not going to make a mistake that could lead to a positive test after July 1.

Q. When you say be made available, in what sense? Will they be in the locker rooms, be they be milling about?
TIM FINCHEM: No, it'll be structured. They'll be there on Tuesdays and Wednesdays. There will be organized seminar-type sessions organized on Tuesdays, and they'll be available for individual one-on-one meetings on Wednesdays. If a player wants to come in and sit down and talk through his own special regimen, what he eats, what he takes, what vitamins, or whatever questions he wants to ask, those personnel will be available.

Q. What's your anticipation for that? It seems a lot of players have maintained throughout this, there's no issue, there's no problem, yet it keeps creeping up once in a while. Guys keep saying, I don't know what's on the list, I'd better find out. What anticipation --
TIM FINCHEM: See, here's the thing. When you say there's no problem, you have to remember, this is a key factor, this is the first time in the history of the game that golf has said that there is a regulation that prohibits you taking a performance-enhancing substance. There have never been any rules in this area in the past. We never cared about it. We have never concluded that there are any substances out there that if you take, it might enhance your performance.
We're actually not certain that there is today. That's not the reason we're going down this path. We're going down this path because the public fan base around the world for sports generally are more and more concluding that athletes, regardless of the sport, are enhancing their position because of use of substances, and we think it's important that sports generally be on the same page, number one. And number two, the way we're headed, if players were to start taking stuff, regardless of a rule, it could jeopardize the image of the sport, and the image of our sport is our number one asset.
For those two reasons, we're making a rule now; that's different. And we want to make sure that players -- we're not talking about the players clamoring for this. We want the players to have every opportunity to get educated so they don't make a mistake.
We are also working on an internship program to bring bright young students into a focus on the golf industry and also trying to marry up job opportunities in the industry with minority candidates. Off the top of my head, I don't have any specific plans beyond that for 2008 other than a continuation of what we think has been a pretty good effort thus far.

Q. Anything, Steve, that you could add?
STEVE MONA: Well, one of the things that we're going to take a look at during 2008 is where we are in the whole area of diversity in the sport, and that takes many different tasks -- pardon me, many different applications. But it would be premature for me to make any statements at this point about exactly what plans are going to be developed and what might be our focus in terms of diversity going forward in the future.
I would only say this: That will be discussed internally without question in 2008, and based upon our discussions, we will be bringing something likely forward to the board sometime during the year. I think that's probably as far as I can go at this point.
BOB COMBS: Ladies and gentlemen, we very much appreciate your participation and interest today. There will be transcripts of this entire teleconference available via email made available to you later this afternoon, and to our speakers, thank you very much.

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