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Matthew P. Lawlor, the co-founder, chairman, and chief executive of Online Resources Corp., is retiring immediately as chief executive, the company announced early Tuesday. Lawlor will remain as chairman until Feb. 15 to assist with the transition, and then scale back to serving on the board of directors of the electronic bill-payment and collection-services technology company he helped start in 1989. A spokesperson for Chantilly, Va.-based Online Resources says Lawlor isn't doing interviews. In a news release, Lawlor said he “thoroughly enjoyed my exciting years at Online Resources and am grateful to its wonderful community of employees, clients, partners, and shareholders. But it is time for me to move on, and it is time to turn the company's leadership over to a new generation. I look forward to supporting a smooth transition that will position the company for a strong future.” Online Resources named 13-year company veteran Raymond T. Crosier, current president and chief operating officer, as interim chief executive. The company also named an executive management committee consisting of Crosier, lead independent director Barry D. Wessler, on the board since 2000, and new independent director John Dorman to oversee the transition. Wessler and Dorman also will lead the search for a new chief executive. They plan to bring in a national search firm. Lawlor's abrupt departure as Online Resource's top executive comes after a punishing year for both him and the company. In the wake of a 70% decline in the company's share price, Lawlor lost a nasty proxy fight earlier this year with Online Resources' biggest shareholder, the hedge fund Tennenbaum Capital Partners. Shareholders elected three Tennenbaum-backed director candidates, including Dorman, over a management-backed slate of incumbents. Afterward, Lawlor appeared to make peace, saying he welcomed the new directors and indicated he wanted to stay on until he completed the implementation of a five-year strategic plan (Digital Transactions News, May 11). The company is about halfway through that plan. Online Resources is the largest of the independent bill-pay technology providers still remaining in a consolidating market now dominated by bank processors such as Fiserv Inc. and Fidelity National Information Services Inc. “What's interesting is that the company has really reflected his [Lawlor's] personality,” says James Van Dyke, president of Javelin Strategy & Research and an executive back in 1989 with one of Online Resources' earliest customers, John H. Harland Co. “They're a unique company, so amazingly frugal.” That frugality may have conflicted with the style of a Wall Street firm like Tennenbaum, says Van Dyke without claiming inside knowledge. Van Dyke adds that one distinguishing feature of Online Resources' platform is its “good-funds” system that assures billers the funds they receive won't be subject to chargebacks or returns. “That's a feather in Matt's cap,” he says. Crosier, Dorman, and chief financial officer Catherine A. Graham held an early-morning conference call with analysts. They didn't say why Lawlor left and none of the analysts directly asked that question. Asked if the board might sell the company, Dorman said the main goal is to boost revenues and earnings, though he didn't rule out a sale. “We continue to look at all options, but a sale of the company is not a principal motivating factor of any decisions we're making right now,” he said. Also on Tuesday Online Resources slightly lowered its earnings guidance for the fourth quarter. Executives blamed the weak economy rather than any specific problems selling the firm's bill-pay or collections systems. “The company continues to operate in an uncertain environment,” Graham said. She added, however, that market acceptance of the company's products is strong, saying that the new bill-pay interface Online Resources introduced in November is “going swimmingly.” One analyst faulted Online Resources for giving overly optimistic forecasts in the past. In a departure from its usual practice late in the year, the company is holding off on giving forecasts for the upcoming first quarter and year until a new chief executive is named.
