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Bankruptcy judge approves sale of BK Racing to Front Row Motorsports

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CHARLOTTE, N.C. — A day after he put his team in Chapter 11 bankruptcy, BK Racing owner Ron Devine alternated between being combative and conciliatory as he spoke to reporters outside his hauler in the Daytona International Speedway garage.

Losses in the millions, a pile of debt and a bank eager to get more than $8 million back in loans and accrued interest led Devine to go to court to protect his team and its charter — the one item that gave his underfunded team its greatest value.

The paperwork was filed, according to court documents, about 30 minutes before a Feb. 15 hearing in Mecklenburg County Superior Court. That hearing was in regards to Union Bank & Trust’s request of a receiver to operate BK Racing and a preliminary injunction to prevent the team from selling or leasing its charter.

“We’ll get it resolved,” Devine said 48 hours before the Daytona 500. “I promise you, we will get it resolved. The bank wants it resolved, and I want it resolved. We will get it resolved. And I’ll see you in Homestead (for the season finale).

“We will be in Homestead.”

Devine was right six months ago. It got resolved.

But left him without a team.

Judge J. Craig Whitley approved the sale of BK Racing — a team Devine helped bring to Cup in 2012 — to Front Row Motorsports for $2.08 million on Thursday.

In announcing his decision, Whitley called the matter “just a bad situation and we’re doing the best we can with it. I don’t expect anybody to be delighted by it, but it is what it is.”

Devine and the team’s engine supplier objected to the sale Thursday. During an early recess, Devine spoke with the attorney for Union Bank & Trust. After the brief discussion, Devine shook his head, walked away and said: “Then that will do it. Jesus Christ.”

Devine and the team’s engine builder urged the judge to let the team continue through the rest of the season and be sold then. Devine stated that he would be an interested buyer then. Devine, it was noted in court, had made an unqualified bid to get the team back.

On the stand, Devine made a last-minute appeal to the judge not to sell the team: “This is wrong to occur during the season. There is the ability to run the team through the end of the season.”

Devine called it a “misconception that this team is on the brink of collapse.”

Trustee Matt Smith, appointed by the court to take over the team from Devine in late March, said Thursday morning on the stand that “cash continues to be very, very tight.”

Smith also said on the stand that “without sponsorship, I run about $30,000 to $50,000 in the hole” per race. Smith expressed concerns that he would be able to run the team through the end of the season.

The charter requires teams to compete each weekend. If the team missed races, it would allow NASCAR to take the charter back and leave BK Racing with little value. While Smith and many others expressed disappointment that the bidding didn’t generate any more money, Smith recommended the sale take place.

When Devine questioned Smith on cross examination about how long it took for him to provide info on the team’s financial status, Smith said: “The business records you had were atrocious.”

After the hearing, Devine said: “That trustee at the very least ought to be embarrassed. He should have stopped it with one bidder. I just think he was in over his head.”

The judge didn’t see it that way and awarded the charter and assets to Front Row Motorsports. The judge also approved the sale of equipment and 19 chassis (primarily in storage and in various stages of readiness) for $265,000 to Obaika Racing and a hauler to Rick Ware Racing for $35,000.

Front Row Motorsports gets BK Racing’s charter, which guarantees a starting spot in every race and a set amount of money per event, and some of its assets, including the cars it is running. Front Row Motorsports was expected to close on the sale as early as Thursday afternoon. All of BK Racing’s employees will be retained as part of the agreement.

Front Row Motorsports now owns both charters that went to BK Racing when the charter system was created before the 2016 season. BK Racing sold a charter to Front Row Motorsports in December 2016 for $2 million, a sale that did not include any other assets.

Front Row Motorsports, a Ford team will run the former BK Racing team, a Toyota team, as a separate entity through the end of the season.

Jerry Freeze, general manager of Front Row Motorsports who attended court Thursday, said the team will not change manufacturers after this season. He also said he did not know who the driver of the BK team will be for next weekend’s Southern 500 at Darlington Raceway. Or if the car number will change from No. 23 to No. 35, a number Front Row Motorsports has used for a third entry at times.

Freeze said the team wants to expand to three full-time cars but admits it will be challenging to find the sponsorship at this point to do so for next year. An option for the team would be to lease two of its charters to other teams — it already leases a charter to TriStar Motorsports and could continue that relationship. Charters can be leased once every five years.

“You’ve got to imagine we’ve been assessing the market for who would need to lease a charter next year and who might be interested in buying one of the other charters that we have,” Freeze said after the hearing. “So we think there’s a market out there for sure. It was worth taking the chance and opportunity to see if we could get this one.”

Front Row Motorsports’ bid topped a bid from Mike Beam, president of GMS Racing.

That a Cup team’s fate was settled in a U.S. Bankruptcy courtroom showed how far BK Racing had fallen. Six weeks after Devine filed Chapter 11 bankruptcy, he lost control of the team when Smith was assigned as trustee. Devine called the judge’s action then “a sad day for BK.’’

It wouldn’t have to come to that had the team been more fiscally responsible. Court documents show that team lost $29.5 million from 2014-16. Court documents show that the team “budgeted” for a loss of $1.358 million in 2017 in what was described as a “skeletal budget.”

Then, there was the millions owed Union Bank & Trust for the numerous loans (now up to more than $9 million). The IRS filed court documents on March 12 that stated it had a secured claim of $2.5 million and a priority claim of $328,792.47 owed. A former employee and current employee at the time testified in March about having paychecks bounce last year. A former employee said he had a paycheck bounce in September 2017, November 2017 and December 2017 before leaving the team.

In May, court documents listed secured claims against the team at $31.6 million. That included $15 million to the Virginia Racers Group, which included Devine and started the team. Court documents also listed unsecured claims at $773,569.17 and non-priority unsecured claims at more than $5 million.

Smith decided this summer that it was in the best interest to sell the team.

“One of the reasons, and I know that Mr. Devine is in the room and probably doesn’t want to hear this, but I think one of the reasons this team is in trouble is it had the wrong owner,” Smith said in court on July 26. “So I believe the right owner, transition of ownership, would be the best thing for this team.”

Smith stated that day that “the cash flow (for the team) is exceptionally tight” and questioned then about going beyond the end of the season.

With all the money spent, BK Racing rarely ran anywhere close to the front. The organization, which fielded up to four cars at times, had three top-10 finishes in its history.

Sunday, in its last race as BK Racing, Blake Jones finished 27th, 15 laps behind the leaders. Only three other cars that made it to the finish ran fewer laps than Jones.

“It’s a tough business,” Devine said in February at Daytona when asked why he didn’t align with another team to help defray costs. “I think it’s an expensive learning curve. I also think … you’ve got to decide where you are taking the company and I took it down a very independent route, which probably wasn’t the smartest (thing).”

But Devine was not deterred Thursday. As he stood outside the federal courthouse awaiting an Uber ride to the airport, he said he still wanted to be in NASCAR as an owner.

“I’ve got other options,” he said.

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Sunday’s schedule for Trucks, Xfinity Series at Iowa Speedway

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Today is Father’s Day and even though the Cup Series is off this weekend, there’ll still be NASCAR racing at Iowa Speedway.

Lots of racing, in fact.

Due to Saturday night’s rainout of the M&Ms 200 NASCAR Gander Outdoors Truck Series race, today will feature a rare same-day, same-track doubleheader at the 7/8-mile paved oval in Newton, Iowa

The rescheduled Trucks race will take the green flag shortly after Noon ET, while the CircuitCity.com 250 Xfinity Series race will go off at 5:30 p.m. ET.

wunderground.com forecasts a temperature of 75 degrees and an 11 percent chance of rain at the start of the Trucks race. Later in the day, wunderground.com forecasts a temperature of 77 degrees and a 14 percent chance of rain at the start of the Xfinity Series race.

Here’s today’s schedule with TV and radio info:

(All times are Eastern)

9 a.m. – Xfinity garage opens

10 a.m. – Trucks garage opens

11:30 a.m. – Trucks driver introductions

12:10 p.m. — M&Ms 200 Truck Series race; 200 laps/175 miles (FS1, MRN, SiriusXM NASCAR Radio)

2:35 p.m. – Xfinity qualifying; single car/two laps (FS2)

3:30 p.m. – Xfinity driver-crew chief meeting

5 p.m. – Driver introductions

5:38 p.m. – CircuitCity.com 250; 250 laps/218.75 miles (FS1, MRN, SiriusXM NASCAR Radio)

Rain washes out Xfinity practices, Truck race at Iowa

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UPDATE AS OF 9:30 p.m. ET:

NASCAR officials tried but Mother Nature refused to cooperate in stopping rain around Iowa Speedway Saturday evening.

As a result, the M&Ms 200 NASCAR Gander Outdoors Truck Series race has been postponed until Sunday. The green flag will drop shortly after Noon ET (to be televised on FS1 and on radio on Motor Racing Network and SiriusXM NASCAR Radio.

Qualifying for Sunday’s Xfinity Series race is slated for 2:35 p.m. ET (FS2, no radio), while the CircuitCity.com 250 Xfinity race will go off shortly after 5:30 p.m. ET (FS1, MRN/SiriusXM NASCAR Radio).

UPDATE AS OF 9 p.m. ET:

The start of tonight’s M&Ms 200 NASCAR Gander Outdoors Truck Series race at Iowa Speedway has been delayed due to weather.

However, the heavy rain has stopped and track drying efforts are underway.

We will continue to monitor the situation and give you updates as they become available.

UPDATE AS OF 7:15 p.m. ET: 

After bad weather prompted NASCAR officials to shorten the first of two Xfinity Series practices at Iowa Speedway, the second and final Xfinity practice has now been cancelled.

NASCAR is still hoping the weather relents to get the scheduled M&Ms 200 NASCAR Gander Outdoors Truck Series in tonight. The green flag is slated to fall at 8:30 p.m. ET (FS1 and MRN/SiriusXM).

Qualifying for Sunday’s CircuitCity.com 250 Xfinity race is still slated for tomorrow at 2 p.m. ET, with the green flag set for shortly after 5 p.m. ET. The weather forecast looks good, according to wunderground.com.

We’ll keep you updated with any changes as they become available.

ORIGINAL STORY:

For the second time today, weather has interrupted activities of both the NASCAR Gander Outdoors Truck Series and the NASCAR Xfinity Series at Iowa Speedway.

Earlier this afternoon, rain forced the cancellation of qualifying for tonight’s M&Ms 200 Truck Series race. The weather also pushed back the start of the first of two Xfinity practices.

In addition to lightning being seen near the racetrack, the area in and around Newton, Iowa is under a thunderstorm watch. That prompted NASCAR officials to stop the first Xfinity practice, which had been already rescheduled once to go from 5:30 p.m. to 6:25 p.m. ET, to be shortened with 25 minutes of time remaining.

Harrison Burton was the fastest driver (130.192 mph) in the Xfinity pack before the session was stopped due to the approaching bad weather.

Second through 10th-fastest were Christopher Bell (130.112 mph), Austin Cindric (130.063), Noah Gragson (129.977), Cole Custer (129.817), Chase Briscoe (128.935), Zane Smith (128.892), Tyler Reddick (128.834), John Hunter Nemechek (128.687) and Justin Allgaier (128.629).

Click here for the results from the abbreviated first Xfinity practice.

A second Xfinity practice is due to take place from 7 to 7:50 p.m., followed by tonight’s main event, the Truck Series race at 8:30 p.m. ET (FS1 and MRN/SiriusXM). However, weather radar to the north and west of the track is not looking promising at this point.

We’ll update as more information on the conditions becomes available.

Rain cancels Truck qualifying at Iowa, delays Xfinity first practice

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Rain has forced the cancellation of today’s NASCAR Gander Outdoors Truck Series qualifying at Iowa Speedway.

In addition, the first of two Xfinity Series practice sessions, slated to be held from 3:05 to 3:55 p.m. ET has been postponed until 5:30 p.m. ET, and will run until 6:25 p.m. ET. The second Xfinity practice is still set to go at its original scheduled time of 7 to 7:50 p.m. ET.

The 7/8-mile oval in Newton, Iowa is currently being dried and NASCAR hopes to get the remainder of today’s activities in, including tonight’s M&Ms 200 Truck Series race, slated to take the green flag at 8:30 p.m. ET.

The starting lineup for the Trucks race has been set by the NASCAR rule book. That means Chandler Smith — making his first-ever career start in a Truck, and who was fastest in the first of two practice sessions earlier today before the rain came — will start on the pole for tonight’s race. Smith (photo) is driving the No. 51 Toyota Tundra for Kyle Busch Motorsports.

Tonight’s race is also the second event in the three-race Triple Truck Challenge; the race winner will receive a $50,000 bonus.

Click here for the starting lineup for tonight’s Truck Series race (televised on FS1 and on radio on MRN and SiriusXM NASCAR Radio).

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Kyle Larson dominates en route to Ohio Sprintweek feature win in Ohio

Photo courtesy All-Star Circuit of Champions
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It may be an off-weekend for the rest of the drivers in the NASCAR Cup Series, but not for Kyle Larson.

The Chip Ganassi Racing driver won the feature event Friday night in the Ohio Sprintweek race at Ohio’s Attica Raceway Park. Larson won the All-Star Circuit of Champions Series race by more than seven seconds, having lapped half the 25-car field by the time he took the checkered flag.

Dale Blaney, uncle of NASCAR Cup driver Ryan Blaney, finished second, followed by Buddy Kofoid.

Larson has now won his last three sprint car race starts. He goes for four in a row tonight as Sprintweek continues.

 

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