The team - headed by Tom Walkinshaw - has been involved in talks with Smith for several weeks, but despite claims negotiations have been progressing well, no confirmed deal has yet been signed.
Now Arrows faces a compulsory winding-up order from the London courts on Tuesday - a situation which could see the team slip into administration. Should that happen, the team will be unlikely to race at the next Grand Prix in Monza, Italy. Failure to do so means it could fall foul of the mysterious Concorde Agreement and forfeit its share of revenues from the race.
However, it is possible the official receiver will continue to run the team in a bid to clear its debts, which may leave the door open for a late takeover - although any such deal is likely to be frowned upon by other teams.
But Arrows must surely be looking today to seal a deal with Smith, a deal which gives the team the best chance of continuing survival.
The FIA, meanwhile, says it is still examining Arrows response in reassuring the motor sport governing body, it is financially sound and can continue in business.
The future of Formula One team Arrows is expected to be decided this week as it looks to secure a major financial deal with US mining tycoon Cal Smith prior to facing a winding-up order from London's law courts tomorrow.
