Faced with a dire financial situation, OnLive has been sold to another company that will do business under the name OnLive. Because the move is an “Assignment for the Benefit of Creditors,” wrote Jane Anderson, the new OnLive PR rep, “Unfortunately neither OnLive, Inc. shares nor OnLive staff could transfer under this type of transaction, but 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.”
In short, the company closed up shop and sold itself without the baggage of employees or former stock options. The new company will run just the same as the old company with no visible changes to the user. Anderson called the firing of current employees a “heartbreaking transition” and said rumors of Steve Perlman cashing out of the old company were not true. Instead, Perlman is losing his stock options and C-level execs are “receiving reduced compensation.”
Here’s a quick Q&A from OnLive about the transaction.
A. Unfortunately not. The nature of the transaction is such that only assets, not shares, were purchased. This is true for all shares of OnLive, Inc., whether held by investors, employees or executives.
Q. Did Steve Perlman receive stock or compensation in this transaction?
A. Like all shareholders, neither Steve nor any of his companies received any stock in the new company or compensation in this transaction at all. Steve is receiving no compensation whatsoever and most execs are receiving reduced compensation to allow the company to hire as many employees as possible within the current budget.
Q. Did all OnLive, Inc. assets transfer into the new company? Are any assets held by any other party?
A. All of OnLive, Inc.’s assets (e.g. technology, patents, trademarks, etc.) were transferred to an assignee, which then sold the assets to the new company. There was no transfer to any other party.
Q. Have OnLive, Inc. employees been offered positions in the new company?
A. Almost half of OnLive’s staff were offered employment at their current salaries in the new company 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.