It’s been a tumultuous last 12 months or so for Motorsport Games. From delays to updates not being released to employees threatening to release the source code of a number of games, there’s been no shortage of drama.
Insider Gaming has been working to get an update on the state of the company since the deadline set by an employee approached and, ultimately, passed by. And now, some new details have been provided as Insider Gaming has spoken to employees within the company.
Though multiple people have spoken for this story, all requested anonymity due to the nature of the conversations and what was provided to Insider Gaming.
Regarding the threat to release the source code of four Motorsport Games titles, a number of employees reached out separately to state that they had all spoken to the individual who was making the treat.
“The whole team informed him that this is wrong, that this is a criminal offense, and we condemn him for such statements,” one employee said. “The [development] team’s position is simple, all relations with the employer should be resolved by negotiating and in the legal terms.”
“The deadlines put forward were more like an ultimatum to the company, but did not help to solve the problems,” another said.
It’s been confirmed that the source code was never released by the employee. That employee who had made the threat did say that he had filed a lawsuit against Motorsport Games. However, Insider Gaming hasn’t been able to independently confirm that the lawsuit has been filed. We’ve also reached out to the employee for more details on the lawsuit, but he has since gone silent since informing us originally of the filing.
Motorsport Games And Its Employees
As far as the unpaid wages, a number of the people we spoke with, including members of the staff in Georgia, say that they had been paid for both November and December.
“The team in Georgia has not been paid since December 28, so less than a month,” one source told us in January while confirming that payment problems did begin in October.
Other people close to the company’s financial situation said Motorsport Games’ only firm request was that anyone from the Moscow team who wanted to remain with the company had to move to Georgia. Those who weren’t ready or willing to relocate to Georgia would be dismissed from the company according to Russian laws.
It was confirmed to Insider Gaming that salaries for those moving to Georgia were 20% less than prior amounts. That issue was raised in a meeting between employees and executives where it was attributed to an accounting era with all salaries being recalculated.
It was emphasized to us, however, that not all payments have been made to employees as of yet.
A Positive Sign For The Future?
This week alone Motorsport Games received a major boost toward its near-term future. The company entered a debt-for-equity exchange with parent company Motorsport Network to help clear $1 million in company debt. The announcement of that agreement saw shares of Motorsport Games skyrocket over 1,000% to more than $37 per share. As of publishing, it currently sits at just over $24 per share, an increase of over 688% from where it was prior to the news.
In a message from CEO Dmitry Kozko to the employees, that increase allows the company to continue to pay off the rest of the owed wages and debts.
“As everyone has seen, we have good activity in our stock yesterday and today,” Kozko told employees via internal messaging. “This should help me raise funds for the company, which will help me settle the debt with you guys. Thank you for your patience.”
After news broke of the various agreements, including that of a new agreement for the “issuance and sale of an aggregate” of 183,020 shares, multiple sources said that this should allow the company some extra runway to continue game development.
One source within the Indy Car game’s development team is confident that this gives them the runway to not only complete the game but get a “much better product” out to fans this year.
“The game is playable and this should allow us to get an even better experience out the door for everyone,” they said. “Everyone deserves it.”
For more Insider Gaming, check out our story on God of War Ragnarok surpassing 11 million units sold.
