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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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JR Motorsports reveals 2019 schemes for Noah Gragson, Justin Allgaier

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On Tuesday, two 2019 paint schemes for JR Motorsports were revealed.

Noah Gragson‘s Armour livery for his new No. 1 Chevrolet will sport a blue, gold and white paint scheme.

Justin Allgaier revealed a special paint scheme honoring America’s farmers. Sponsor Brandt posted a video to go along with the announcement that juxtaposes the wrapping of the Chevrolet Camaro with the use of their equipment and a poem by Walterrean Salley.

 

Dale Earnhardt Jr. named pace truck driver for 2019 Daytona 500

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No matter who wins the pole for the 2019 Daytona 500, they will start behind Dale Earnhardt Jr. He has been named as the pace truck driver for the season opening race.

The two-time Daytona 500 winner will lead the field to green for the 61st edition of the “Great American Race” in a Chevrolet Silverado pace truck. It will be the first time a truck has been used as a pace vehicle for the Daytona 500.

Chevrolet has previously paced the Daytona 500 on 12 occasions: seven with Camaro and five with Corvette.

“I’ve had a lot of fun and a lot of success at Daytona over the years, and now I can’t wait to get out on that track in a Silverado,” Earnhardt said in a press release. “Away from the track I’ve driven Chevy trucks all my life, and I’m excited to have this unique experience of pacing the Daytona 500 with the Silverado.”

This year Earnhardt was the Grand Marshal for the Feb. 18 running of the 500, giving the command to start engines.

Earnhardt won the 2004 and 2014 editions of the 500. He has two July victories on the track as well.

“Dale Earnhardt Jr. was the perfect choice to pace the race because of his enthusiasm for the sport, his long history with Chevrolet and his love of trucks,” said Jim Campbell, Chevrolet’s U.S. Vice President of Performance Vehicles and Motorsports in a press release. “It’ll be exciting to have Dale lead the field to green in the strongest, most advanced Silverado ever.”

 

NASCAR partners with Sportradar for gambling fraud detection service

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NASCAR has entered a multi-year agreement with Sportradar to make use of its sports betting fraud monitoring services, the two companies announced Tuesday.

As part of the agreement, Sportradar’s Fraud Detection System (FDS) will monitor domestic and global betting activity for signs of fraudulent activity for all three of NASCAR’s national series: the Cup, Xfinity and Gander Outdoors Truck Series.

NASCAR will also have use of Sportradar’s Education and Prevention Services, which includes on-site workshops for NASCAR drivers, teams, officials and associated stakeholders delivered by Sportradar’s integrity and educational experts. Sportradar’s Integrity Services will also help NASCAR develop a full-fledged betting integrity program, including betting-related rules and policies.

NASCAR and Sportrader have an established history. In 2015, SportsData, a subsidiary of Sportrader, partnered with NASCAR to distribute its live timing and scoring data to third-party digital outlets.

The announcement of the partnership is the last step in NASCAR embracing sports gambling following a ruling by the Supreme Court in May that allowed states to decide if they allow sports betting.

In October, Dover International Speedway in Delaware became the first track that hosts NASCAR to introduce at-track betting.

That weekend NASCAR President Steve Phelps said the sanctioning body will add rules clarifying its policy for competitors in 2019.

“I think for ’19 we’ll have some rules that we’ll put in place,” Phelps said. “For right now, there’ll be betting here. We’ll study and see how that goes, but I think we’ll have some rules in place for sponsorship, for what betting looks like and continue to see what happens in the landscape overall.”

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NASCAR Cup Series race start times announced for 2019

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NASCAR has announced its race start times for the 2019 Cup Series season, with a notable change in start time for the playoff opener at Las Vegas Motor Speedway.

After a start time of 3 p.m. ET this year, next season’s race will begin at 7 p.m. ET/4 p.m. PT on NBCSN.

“Moving the start time for the September race at Las Vegas Motor Speedway is fitting because it will deliver a better experience for our fans attending the race, and kick off the Monster Energy NASCAR Cup Series Playoffs in primetime,” said Steve Herbst, NASCAR’s Senior Vice President of Broadcasting and Production in a press release. “Each race weekend, including Las Vegas, is unique, and we work collaboratively with broadcast partners, teams and tracks to ensure the ideal timing is selected for our events.”

Other notable start times:

  • The Daytona 500 is scheduled for Feb. 17 at 2:30 p.m. ET on FOX.
  • The March 31 race at Texas Motor Speedway will start one hour later, moving from a 2 p.m. ET start to 3 p.m. ET. The race also moves to FOX.
  • The start time for New Hampshire Motor Speedway’s July 22 starts one hour later, moving from 2 p.m. ET to 3 p.m. ET.
  • Martinsville Speedway’s Oct. 28 playoff shifts a half-hour later to a 3 p.m. ET start.

Here’s the full schedule with start times and TV and radio networks:

DATE

RACE

NETWORK

RACE START (ET)

RADIO

Sun, Feb 10, 2019

Daytona 500 Qualifying

FOX

12:00 PM

MRN

Sun, Feb 10, 2019

The Clash

FS1

3:00 PM

MRN

Thu, Feb 14, 2019

Duel at Daytona

FS1

7:00 PM

MRN

Sun, Feb 17, 2019

Daytona 500

FOX

2:30 PM

MRN

Sun, Feb 24, 2019

Atlanta

FOX

2:00 PM

PRN

Sun, Mar 03, 2019

Las Vegas

FOX

3:30 PM

PRN

Sun, Mar 10, 2019

ISM Raceway

FOX

3:30 PM

MRN

Sun, Mar 17, 2019

Auto Club Speedway

FOX

3:30 PM

MRN

Sun, Mar 24, 2019

Martinsville

FS1

2:00 PM

MRN

Sun, Mar 31, 2019

Texas

FOX

3:00 PM

PRN

Sun, Apr 07, 2019

Bristol

FS1

2:00 PM

PRN

Sat, Apr 13, 2019

Richmond

FOX

7:30 PM

MRN

Sun, Apr 28, 2019

Talladega

FOX

2:00 PM

MRN

Sun, May 05, 2019

Dover

FS1

2:00 PM

MRN

Sat, May 11, 2019

Kansas

FS1

7:30 PM

MRN

Sat, May 18, 2019

All-Star Open

FS1

6:00 PM

MRN

Sat, May 18, 2019

All-Star Race

FS1

8:00 PM

MRN

Sun, May 26, 2019

Charlotte

FOX

6:00 PM

PRN

Sun, Jun 02, 2019

Pocono

FS1

2:00 PM

MRN

Sun, Jun 09, 2019

Michigan

FS1

2:00 PM

MRN

Sun, Jun 23, 2019

Sonoma

FS1

3:00 PM

PRN

Sun, Jun 30, 2019

Chicagoland

NBCSN

3:00 PM

MRN

Sat, Jul 06, 2019

Daytona

NBC

7:30 PM

MRN

Sat, Jul 13, 2019

Kentucky

NBCSN

7:30 PM

PRN

Sun, Jul 21, 2019

New Hampshire

NBCSN

3:00 PM

PRN

Sun, Jul 28, 2019

Pocono

NBCSN

3:00 PM

MRN

Sun, Aug 04, 2019

Watkins Glen

NBCSN

3:00 PM

MRN

Sun, Aug 11, 2019

Michigan

NBCSN

3:00 PM

MRN

Sat, Aug 17, 2019

Bristol

NBCSN

7:30 PM

PRN

Sun, Sep 01, 2019

Darlington

NBCSN

6:00 PM

MRN

Sun, Sep 08, 2019

Indianapolis

NBC

2:00 PM

IMS

Sun, Sep 15, 2019

Las Vegas

NBCSN

7:00 PM

PRN

Sat, Sep 21, 2019

Richmond

NBCSN

7:30 PM

MRN

Sun, Sep 29, 2019

Charlotte

NBC

2:30 PM

PRN

Sun, Oct 06, 2019

Dover

NBCSN

2:30 PM

MRN

Sun, Oct 13, 2019

Talladega

NBC

2:00 PM

MRN

Sun, Oct 20, 2019

Kansas

NBC

2:30 PM

MRN

Sun, Oct 27, 2019

Martinsville

NBCSN

3:00 PM

MRN

Sun, Nov 03, 2019

Texas

NBCSN

3:00 PM

PRN

Sun, Nov 10, 2019

ISM Raceway

NBC

2:30 PM

MRN

Sun, Nov 17, 2019

Homestead-Miami

NBC

3:00 PM

MRN

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