OnLive Explains Friday’s Cryptic Restructuring

Rumors swirled around OnLive after the company engaged in a series of bizarre actions on Friday. Hoping to quell some of the questions, the company sent us a statement late Sunday night to clarify things. The story is still wacky, but at least now it makes sense.

The company did indeed go through a sort of bankruptcy, called an “Assignment for the Benefit of Creditors.” As part of the proceedings, the company’s assets — technology, desk chairs, intellectual property and all — were sold off to a newly formed company that plans to continue operating and offering the service under the OnLive name. The transition was so seamless, in fact, that there will not be an interruption of service. The new company is backed by an affiliate of Lauder Partners, a firm that originally invested in OnLive back in 2009.

The ABC deal didn’t include a provision for staff, so the company’s employees were indeed laid off, but OnLive’s Jane Anderson told us that “almost half of OnLive’s staff were given employment offers by the new company at their current salaries immediately upon the transfer, and the non-hired staff will be given offers to do consulting in return for options in the new company. Upon closing additional funding, the company plans to hire more staff, both former OnLive employees as well as new employees.”

We’re not sure how many of those former employees will take up the new company’s offer for stock options in exchange for consulting, seeing as how none of the existing shares for OnLive were transferred in the ABC settlement either. The stock options paid to OnLive employees previously — including founder Steve Perlman’s shares — are basically worthless scraps of paper now. PCWorld reports that HTC has already announced that it will take a $40 million hit from its investment in OnLive.  

Email* (will not be published)
*Indicates required field
Submit Comments

All Product Types Accessories Cars Digital Camcorders Digital Cameras eReaders GPS Laptops MP3 & Video Players Projectors Smartphones Software Storage Tablets / MIDs VoIP Wi-Fi
All Subcategories
All Subcategories All-Purpose Budget Business Desktop Replacement Gaming Multimedia Netbook Nettop Rugged Student Tablet PCs Ultraportable
Acer Alienware Apple Archos ASUS Averatec BenQ CTL Corp. Dell Digital Storm eMachines Emtec Everex Fujitsu GammaTech Gateway General Dynamics Getac Gigabyte Hercules HP HTC iBuyPower Intel Lenovo MSI Nokia Nvidia OCZ OLPC OQO Origin Panasonic Sager Samsung Sony Sylvania Systemax TabletKiosk Toshiba Verizon Viewsonic Viliv VooDoo Workhorse PC ZT Systems
Minimum Rating
Any Rating 4.5 Stars 4.0 Stars 3.5 Stars 3.0 Stars
Screen Size
10 11 12 13 14 15 16 17 18 20 4 5 6 7 8 9
1024x576 1024x600 1024x768 1200X800 1280 x 720 1280x1024 1280x768 1280x800 1366x678 1366x768 1440x1050 1440x900 1600x768 1600x900 1680x1050 1680x945 1920x1080 1920x1200 800x400 800x480
Weight Range
10.1 - 12.0 pounds 12.1 - 14.0 pounds 14.1 - 16.0 pounds 2 lbs 2 pounds and under 2+ lbs 2.1 - 4.0 pounds 4.1 - 6.0 pounds 6.1 - 8.0 pounds 8.1 - 10.0 pounds Over 16 pounds Under 2 pounds
more options