OnLive transfers assets to new company in bankruptcy bypass
The news follows several days of online speculation, much of which had suggested that OnLive was on the brink of bankruptcy.
Instead, OnLive's board of directors pursued an alternative the 'assignment for the benefit of creditors.'
Different but the same
This process sees all of OnLive's assets including technology, patents and trademarks transferred to a newly formed company, which will be required to meet existing obligations to OnLive's creditors.
OnLive insists that its services across all devices will remain operational, thanks to investment from an affiliate of Lauder Partners in the restructured company.
OnLive's existing partnerships and current initiatives will remain in effect, too.
In fact, OnLive customers are not expected to notice any change at all.
However, the same can't be said for OnLive's staff, since the company's workforce and shares could not be transferred to the new company under the 'assignment for the benefit of creditors.'
As such, all employees have technically been made redundant, though OnLive claims to have hired back "almost half" of its former employees at their previous salaries, while it is also offering consulting work to its 'non-hired staff' in exchange for options in the new company.
Should the restructured OnLive secure additional funding, it has pledged to hire back more former OnLive employees, as well as new staff.
OnLive's press statement referred to the restructuring process as a "heartbreaking transition" for all involved, but noted that this was the best course of action considering the "difficult financial decisions" faced by the company.
The assignment for the benefit of creditors "allows the company's core innovation and ongoing offerings the product of over a decade of hard work transforming the OnLive vision into reality to survive and continue to evolve."
"All games, products and services remain available, and the company has new product and partnership announcements on the way."