October 7, 2009 / 11:48 AM / 8 years ago

UPDATE 1-Motorsports Authentics defaults on royalty payments

2 Min Read

* Defaults on guaranteed royalty payments

* Says exploring strategies to turn business around

* Says could ultimately pursue bankruptcy

Oct 7 (Reuters) - Motorsports Authentics, an equally owned merchandise joint venture between race-track owners International Speedway Corp (ISCA.O) and Speedway Motorsports (TRK.N), has received default notices from certain licensors, regulatory filings show.

In a filing with the U.S. Securities and Exchange Commission, Speedway Motorsports said Motorsports Authentics had stopped paying certain guaranteed royalties in its third quarter, and was attempting to renegotiate agreements with all significant licensors of NASCAR merchandising.

"MA is exploring other business strategies to turn its business around. If such efforts are not sufficient or timely, MA could ultimately pursue bankruptcy," the filing said.

The joint venture, which produces and markets licensed motorsports products, also received a going concern qualification from Grant Thornton LLP in January, the filing said.

In its second quarter, International Speedway took a non-cash impairment charge of $1.17 per share for loss on its equity investment in Motorsports Authentics.

Shares of Speedway Motorsports closed at $14.38 on the New York Stock Exchange, while those of International Speedway closed at $27.74 Friday on Nasdaq. (Reporting by Santosh Nadgir in Bangalore; Editing by Maju Samuel)

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