The Charlotte Observer from Charlotte, North Carolina • 15

THE CHARLOTTE OBSERVER Sunday October 1 1995 15A RISK AT EVERY TURN The life and times of 1944: Bruton Smith graduates from Oakboro High School in Stanly County voted most athletic most popular most conceited Smith and Curtis Turner (right) in 1959 1955: Smith earns $128050 nearly 100 times the state's per-capita income at the time selling cars and promoting races in Charlotte Concord Rock Hill and Shelby 1959: He drives across the state selling stock to help legendary racer Curtis "Pops" Turner raise $300000 to build Charlotte Motor Speedway June 19 I960: The first World 600 is held at CMS attracting 78000 fans November 1961: The speedway files for protection from creditors Bankruptcy trustee sues Smith saying he took a $12500 kickback from a speedway contractor 1962: Smith is indicted for failing to pay federal taxes for 1 955 and 1 956 He pleads guilty and pays a $4000 fine Smith who testified on his behalf was always saying need to be very supportive of your and that he would take care of her" he recalls Smith appealed decision to the NC Supreme Court which ordered a retrial on part of the case Last fall the Smiths privately negotiated a $194 million settlement payable over 30 years Smith agreed to pay law firm Robinson Bradshaw Hinson about $450000 The Charlotte firm which had worked for 5V4 years without compensation is suing the Smiths for breaching the contingency-fee contract that could have netted it millions Bruton Smith has countersued alleging that Brackett had an affair with Bonnie Smith Brackett denies that Bonnie Smith won't talk about it Smith now lives alone in the Charlotte mansion where he receives frequent visits from his children His closest friends work for him Wheeler Town Country vice president Bill Sullivan Speedway executive Bill Covington and Tom Sadler who runs the 600 Charities showplace Smith has spent more than $200 million on the Charlotte speedway since 1975 expanding it from 65000 to 110000 seats and adding 85 skyboxes Wheeler David Letterman and almost everybody else thought his idea of condos at the track in 1983 was zany but they now sell for as much as $500000 He added a $17 million lighting system in 1992 so that the Memorial Day weekend race could start in late afternoon rather than compete for TV time with the Indianapolis 500 With the race now broadcast live nationally television rights and advertising sell for much more second track is Atlanta Motor Speedway He borrowed $23 million from NationsBank to buy it in 1990 and has since added 30000 seats and 46 condos Revenues and profits at the two tracks have more than doubled in the past four years That success enabled Smith who earned $11 million last year to take his company public in February as Speedway Motorsports Inc He used the $75 million raised in the stock sale to repay much of his bank debt and finance an expansion into Texas He kept three-fourths of the company valued at $374 million based on closing price of $25875 The stock has zoomed 44 since the initial offering His dealerships Town Country Ford and Town Country Toyota in Charlotte Lone Star Ford in Houston and Frontier Olds-Cadillac in Monroe add at least $40 million more to his net worth Still despite his wealth and links to NationsBank Smith feel accepted by business community One reason several civic leaders say is that Smith contributes little time or money to local causes Shortly after death he and Bonnie Smith started the 600 Charities Foundation which now gives out $150000 annually But that money come directly from Smith The adoration of the Hornets and Panthers bugs Smith He tried to get Panthers owner Jerry Richardson to build the NFL stadium beside the speedway but Richardson chose uptown instead A drawing of a speedway-stadium complex still hangs on office wall Asked if he is on good terms with Richardson he just shrugs MARK SLUDERStaff Expansion continues: New Turn 4 grandstands the track since at Charlotte Motor Speedway near completion in 110000 seats April Smith has spent more than $200 million on condos February 1964: Charlotte Motor Speedway emerges from bankruptcy protection Smith loses the bankruptcy-kickback case but no fine is levied He appeals but a federal appeals court affirms the judgment 1965: Speedway stockholders reject Smith's bid to win a board seat 1 July 1966: Smith joins Charlotte's Bill Beck Ford as a salesman Three months later he is sales manager 1 Spring 1967: He leaves Charlotte to run a Ford dealership in Colorado r1968: At age 41 he buys Frontier Ford in Rockford III June 61972: Smith marries interior designer Bonnie Harris 24 Late 1972: Ford picks him from more than 100 dealers to start a new dealership in Houston He pays $180000 for 90 ownership wins a seat on the speedway's board He controls 460000 shares or stock then buys another 380000 18 months convicted and fined $100000 in a Georgia assets of one of his companies to Bruton Feb 1974: Smith and becomes chairman 25 of the speedway's shares over the next 1975: Smith is state court for diverting private use 1975 expanding it from 65000 to and adding 85 skyboxes and 46 declared insolvent in March 1990 It was $48 million in the hole at the time The Resolution Trust Corp the federal agency that disposed of failed sued Smith Wheeler and 10 other former NC Federal directors in 1993 accusing them of negligent and of their legal duties The suit said they established proper real-estate appraisal procedures and required feasibility studies on big real-estate projects US District Judge Graham Mullen threw out the suit in 1994 saying it lacked "a single specific example of how and when these duties were The RTC appealed ruling but the case was settled out of court this summer Smith and the other defendants paid less than $500000 Another speedway fight While NC Federal was dying Smith was expanding his control of speedway He engineered a reverse 1-for-100 stock split in 1983 prompting more than half the stockholders to sell him their stock rather than hold fractional shares Then in July 1985 the board approved a in which Smith would acquire the remaining 20 of stock for $300 a share and merge the track into one of his companies Shareholders sued saying Smith was lowballing them A year later he settled and paid the more than 700 stockholders $756 a share Finally the speedway was all his fight over the speedway stock mirrored his messy divorce death in 1980 wiped Mom out pretty badly and somewhere in there is when their marriage really began to go Scott Smith recalls Bonnie and the children moved out of the house in 1988 Their equitable-distribution trial two years later matched two of heavyweight trial lawyers: Bill Diehl for Bruton vs Martin Brackett for Bonnie Diehl played hardball arguing that net worth was a negative $2 million because of his indebtedness to NCNB That was off by $51 million according to Judge Stanley Brown who ruled $49 million was the correct total But the Smiths kept the fighting in the courtroom Bruton never said a harsh word about Bonnie in front of his children says Scott of Republic Bank Trust Co Weeks later the bank paid a premium to buy back his stock a practice known as greenmail His profit was $190000 Later in 1982 he made a $250000 profit in two months on the stock of Charlotte-based PCA International Inc a portrait-photography company Those investments reveal a little-known side of Smith: an active stock picker have no idea how much money made in the stock market but a lot" Wheeler says he says not in the market time to sell all of your stocks because he has an eighth sense about Wall Street that is pretty incredible" But the magic was missing when Smith went after NC Federal Savings Loan He started buying shares in 1980 paying about $750000 for a 10 stake It was the heyday for His initially good relations with the managers soured when Smith opposed their plans to acquire four smaller institutions The buyouts which would have made NC Federal the biggest savings and loan were scuttled After bought more than 40 of NC stock in 1983 the thrift sued him citing his past legal problems as evidence that he was unfit to control an In its most sensational allegation NC lawsuit said: has a history of close personal and business relationships with persons investigated by federal authorities for illicit criminal That referred to purchase of NC Federal stock from the pension-fund arm of New York Teamsters Local 810 The suit started persistent rumors about relations with the Teamsters whose ties to organized crime caused the federal government to oust President Jackie Presser and other union leaders in the Smith called the allegations He threatened a libel suit but never filed one The case was settled out of court in 1984 Smith says his only link to the union was buying its stock His associates dismiss the rumors citing his independent nature antiunion views and the scrutiny of NationsBank and Ford Motor Co among others Bruton does he does himself" Wheeler says Smith wound up winning NC Federal but the victory cost him $5 million when the thrift was and Bonnie Smith 1983 Smith Revenue and profits at 2 tracks double Continued from preceding page Wheeler whom Smith had hired four months earlier as a $24000-a-year director of development Smith asked NCNB President Luther Hodges Jr for money to improve and expand the track The bank loaned the speedway $22 million with his car dealerships as collateral Since then NCNB and its successor NationsBank have loaned companies more than $100 million order for the sport to get awful big you could not stand and Wheeler says going to have to charge forward and take some pretty big risks And Bruton Family moves to Charlotte Smith and his family moved to Charlotte in 1979 He was sick of cold weather Their new home was a big change from his Oakboro roots: a 9759-square-foot five-bedroom six-bath mansion near SouthPark mall They paid $850000 to buy and renovate the home built in 1948 by Charlotte utility contractor FJ Blythe Its tax value is now $11 million While his businesses were humming personal tragedy struck The fourth child Bruton Cameron Smith suffocated in his crib April 24 1980 at 6I2 months Bruton Smith still chokes up when talking about Cubbie made me realize how fragile life he says realize to what extent you will go to protect your children after an incident like Bonnie Smith took the lead in raising their children The youngest Anna Lisa was bom in 1982 we mostly got Dad was during the evenings and on part of Saturday" says Scott Smith now Town Country general manager bonded at our indoor swimming pool (in Rockford) when every night come home and sit by the pool and watch me swim At the same time be on the phone talking to all his managers getting the Smith says he has no regrets about how he has mixed his work and family life This summer he points out he took his sons to the Brickyard 400 race in Indianapolis Smith loves fancy hotels with great room service but th shared a simple $60 motel room to be close to the speedway The best memory: While older brother Marcus slept David started shaving the hair off his arms with an electric razor dad really got into that" Scott recalls just tickles Messy stock dispute Through the Smith was a constant newsmaker in Charlotte because of the ever-expanding speedway and his excursions into other businesses In 1982 he accumulated shares 1978: Smith buys Charlotte's Town Country Ford The same year he is fined by an Illinois court for evading federal and state taxes March 1979: Smith owns 10 car dealerships ranking him among the nation's top Ford and Dodge dealers D6C6mb6r 1979: He sells Charlotte's Dodge Country dealership March 1980: He closes Frontier Ford in Rockford III And he pays $750000 for a 10 stake in NC Federal Savings and Loan March 1982: He joins NC Federal's board of directors 1983: He accumulates more than 40 of Federal's stock then blocks management's plan to acquire four thrifts Federal sues him Meanwhile he pays $71179 to settle a dispute with the IRS over underpayment of 1977 income taxes 1984: NC Federal's lawsuit settled out of court Smith gains control of the thrift July 1985: The speedway board approves a "squeeze-out merger" in which Smith would acquire the remaining 20 of stock for $300 a share Shareholders sue saying Smith is lowballing them Mid-1986: He settles the suit and pays them $756 a share The latest frontier Charlotte may not adore Smith but most everyplace else has thrown out a red carpet for him as he scouted dozens of sites for a new speedway over the past two years How St Louis treated Smith shows how much has changed since that 1959 brush-off from Curtis Turner at the Barringer Hotel Smith flew to Missouri expecting a brief chat with the tourism director I walked into this meeting room and there were 60 people sitting there" Smith says were people from city government state government federal government and all kinds of lawyers They said the governor would call me in five minutes and sure enough he did They were ready to do the Smith St Louis has an obstacle that even he overcome Mississippi River scares Smith says 10 feet and you are out of business" He opted instead for dry flat Texas He pitted Dallas against Fort Worth while seeking the best deal and eventually chose Fort Worth land controlled by Ross Perot Jr Two shifts of workers at the site are moving 20000 yards of dirt a day seven days a week Smith is plunging ahead even though NASCAR yet agreed to hold a Winston Cup race there Once again taking a big risk But with his record no one is betting against him 1988: Smith and his wife separate 1990: The Resolution Trust Corp seizes NC Federal and declares its stock worthless costing Smith $5 million He borrows $23 million to buy Atlanta International Raceway Fall 1994: The Smiths privately negotiate a $194 million divorce settlement February 1995: Smith takes the Charlotte and Atlanta tracks public as Speedway Motorsports August 1995: Construction starts on Texas Motor Speedway near Fort Worth Home alone: Smith lives alone in this 9759-square-foot house near SouthPark mall He bought it for $850000 in 1979 and moved his family to Charlotte Its tax value is now $1 1 million i.