DAYTONA BEACH, Florida — BK Racing filed for Chapter 11 bankruptcy Thursday afternoon in Western District Court of North Carolina.
Chapter 11 bankruptcy allows a business to propose a plan or reorganization by which they will restructure their debts.
NASCAR issued a statement to NBC Sports about BK Racing’s situation and the status of its charter.
“We have a clear process around charter member governance. It is incumbent upon charter members to be ready to race and compete at the highest level. BK Racing remains the holder of the Charter.”
The action came shortly before a hearing was scheduled Thursday in Mecklenburg County Superior Court on Union Bank and Trust’s request to have a receiver to oversee BK Racing’s collateral. Union Bank & Trust claims that BK Racing owes it more than $8 million in outstanding loans. Among BK Racing’s most valuable pieces of collateral is the charter it has for the No. 23 car that has Gray Gaulding in the car at Daytona International Speedway.
ESPN.com reported that as of last week BK Racing was facing a federal tax lien of more than $667,000 and owes the North Carolina department of commerce fees of about $66,000, according to court records.
In its bankruptcy filing Thursday, BK Racing estimated the number of its creditors as 50-99. The team estimated its assets as between $10-50 million and estimated liabilities of more than $10 million.
Among the 20 creditors with the largest unsecured claims (those that do not have a lien against BK’s property), the team listed:
$569,539.95 to Race Engines Plus
$94,999.00 to Champion Tire & Wheel
$72,507.22 to Moroso Performance
$70,550.00 to Champion Air
$62,303.63 to Enterprise Holdings
$57,785.53 to Panki Racing Systems
$49,367.17 to Simpson Performance Products
$41,814.80 to Precision Products
$35,072.46 to Harraka Racing Equipment
The 20 creditors with the largest unsecured claims are owned a total of $1,235,493.27.