City Loan For Grand Prix Linked To Two Miami Businessmen
Written by Susan Stabley on January 15, 2004
By Susan Stabley
A pledge backing a $2 million loan from the City of Miami for the now-unscheduled Grand Prix Americas race is linked to attorney Peter Yanowitch and developer-architect Willy Bermello, according to city documents.
In July 2002, the Miami businessmen and part owners of Raceworks signed off as guarantors for the loan from the Miami Sports and Exhibition Authority to create a race course through downtown.
Also signing a guaranty for the loan was Tom Carter, chief financial officer and treasurer for Championship Auto Racing Teams, a Delaware corporation with headquarters in Indianapolis.
Championship Auto Racing Teams later bought Raceworks from its three local owners – Mr. Yanowitch, who held 64% of the company; Mr. Bermello, who held 33%; and racing legend Emerson Fitipaldi, who held 3%. The $1.2 million purchase in March included $473,000 cash and a $722,000 promissory note, according to filings with the Securities and Exchange Commission.
Championship Auto Racing Teams has sent the company that handles its racing series, CART Inc., into bankruptcy proceedings.
At least $1.8 million is owed to the city by Raceworks, and officials with Championship Auto Racing Teams have not explained how they will pay off debt for a race no longer scheduled to run.
City attorney Alex Vilarello said Thursday that the city is reviewing SEC filings. Ferey Kian, the Miami sports authority’s director of finance, said the board will consider its options on the loan – including asking Championship Auto Racing Teams to accelerate payment.
Championship Auto Racing Teams has paid $200,000 against the load, according to Mr. Kian, and $50,000 is due Jan. 31. Final payment with interest is due July 31, 2007. The city loaned money to Grand Prix Americas at 1.5% over the prime rate, he said.
Championship Auto Racing Teams spokesman Eric Mauk referred calls about the loan to the company’s chief financial officer, Tom Carter, who was not in his office.
CART’s assets have been put up for bid as part of the bankruptcy proceedings, but Raceworks and its Grand Prix Americas race is not part of the auction. Bids may be made by Jan. 23, with a court hearing set for Jan. 28. California-based Open Wheel Racing Series has submitted the only bid thus far.
CART is wholly owned by Championship Auto Racing Teams, a publicly traded company, said Indianapolis attorney James Carr, who is handling the Chapter 11 proceedings for the company.
There is no immediate cause for action against Mr. Bermello or Mr. Yanowitch, Mr. Vilarello said Thursday. Championship Auto Racing Teams still exists and is top-listed as being responsible for the loan.
Mr. Kian said when the loan to Raceworks was proposed that "we made sure to get the guaranty" from Mr. Bermello and Mr. Yanowitch.
"They were the ones who guided us down this yellow brick road," Mr. Kian said Monday.
Mr. Bermello could not be reached this week for comment despite several calls to his office.
Mr. Yanowitch would only comment on the issue through his publicist, Jami Reyes, a partner in Miami PR firm Gordon Reyes. Ms. Reyes said Championship Auto Racing Team, which has not filed for bankruptcy protection, owns the Grand Prix Americas race. She said Mr. Yanowitch’s only comment is that "the documents for the loan speak for themselves."