UPDATED WITH MORE DETAILS: In a shocking move, upstart talent agency Resolution has just announced to its staff that it is dissolving. Agency insiders have said for the last hour, owner Jeff Berg’s staff has been meeting with  the troops — Resolution has a headcount of 50 agents and support staff — telling them that the agency has to wind down because its funding partner, Bison Capital, has not fulfilled promised funding obligations. Insiders said that because of this, the agency is shutting down, and that Berg will do his best to help people find jobs elsewhere — as well as clients and creditors who signed on to the new percentery that Berg started after he left ICM 18 months ago. “The emphasis now is to help people get jobs and create transitions,” said a source.

China-And-Hollywood__130605112955-150x150__130925193515__131105220131__140418151541The problem: Peixin Xu, the principal at Bison Capital, has written the company missives as recently as July saying he wants to be supportive. But he has been anything but that. The promised funding has been late, and the amounts received have been low. This put the company under severe strain for the last few months to the point it is over and out. Bison is a China-based company, and this has to be a big blow to Berg and top agents there like David Unger, who positioned the agency as a bridge to China. We might have to get used to this, and it probably won’t be the last time this happens as Hollywood turns to that region for funding with the highest hopes. It is a different game, dealing with a Communist-run government and entrepreneurs who aren’t as experienced in these kinds of deals.

Related: Another Resolution Exit: Shari Smiley Joining Gotham Group

I’ve heard that Bison also made grand plans to fund up to 15 scholarships for the American Film Institute, sending Chinese nationals to study at the AFI conservatory as Bison Capital Fellows. Word is that these scholarships have been cut down to maybe one.

The promises to Resolution were made last July, following a big presence that the agency had at the Cannes Film Festival including a big bash where guests were helicoptered back and forth. Resolution had its ups and downs as any new agency would in this climate, but clearly the play was China and it has failed miserably. Insiders said that if the money had come, the agency might have broken even or at least had the funds to continue building. “The rug was pulled out,” is the way it was told to me. Berg’s Resolution was originally capitalized through Jahm Najafi, the CEO of the media investment company Najafi Companies. He turned to China later on.

Related: Resolution TV Lit Agent Dennis Kim Exits To Become A Manager

Allen And Company Annual Meeting Draws Top Business Leaders To Sun Valley, IdahoBerg and his troops were introduced to this arrangement by Jack Gao, the former head of News Corp China and ex-head of Microsoft China, an Eastern-minded exec with a deep China background. There has been movement at these companies that created instability, and Resolution has paid the ultimate price.

Things haven’t been easy on the domestic front. Berg brought in some top agents, and most of them left well before this amid rumors of belt-tightening and requests for pay cuts. Recent exits included Leigh Brillstein, who’d previously worked for Berg at ICM for 25 years, former CAA agent Shari Smiley, head of TV lit Dennis Kim, Steve Alexander, original COO and veteran music agent Jeff Franklin and CAA agents Adam Kanter and Martin Spencer (who later moved to Paradigm). The agency never established a stronghold in the TV lit area, depriving it of the hugely lucrative TV packaging revenue. Additionally, feature agents were losing the clients who came with them to Resolution. It seems very difficult these days to launch a talent agency; most of the big ones have diversified into areas like sports and music touring and other areas, because the movie and TV businesses aren’t what they used to be, and they are incredibly difficult to build from the ground up.

Related: Resolution COO Jeff Franklin Exits Agency

Berg formed the agency with great fanfare, shortly after the ICM braintrust found out he was raising money and they came to a parting of the ways after 27 years. Berg is a storied agent himself, who at one time or another repped everyone from James Cameron on down, and who at one point led an ICM that had some of the strongest agents in town and went head to head with CAA. Pieces began breaking off, including when Ari Emanuel, Tom Strickler and cohorts left to form Endeavor, and when Jim Wiatt and Dave Wirtschafter went to WMA and brought a lot of the young agency blood with them.

Many feel it is virtually impossible to form a Hollywood talent agency today, unless you focus on lit the way that upstart Verve has and then look for strategic opportunities to grow. Some of the more successful shops in recent years used that as a stronghold, because you keep costs down and have the potential upside to be part of television packages that are still lucrative. Endeavor, for instance, distinguished itself as a lit agency and it really didn’t get into the talent business until later, when it brought in dealmakers like Adam Venit and Doug Robinson and especially when Patrick Whitesell came over from CAA with clients that included Ben Affleck and Matt Damon. Even those guys would have had trouble keeping their clients if there wasn’t an established coteries of strong writers, directors and showrunners you could create packaging opportunities with.

Related: Resolution Agents Martin Spencer, Adam Kanter Exit

Another success story was Broder Webb Chervin Silbermann, which became a TV packaging powerhouse with its lit-centric business. That agency merged with ICM and gave the latter a shot in the arm. Resolution never quite got to that place. There are some solid agents who will be up for grab that include Rich Green, the longtime broker of books for movies, Unger and Abram Nalibotsky. Some of these people ought to be picked up quickly. Stay tuned.

Then there is Berg, a brilliant entrepreneur who will attend to settling out a business that we would call a noble attempt at a third act. He continues to rep clients that include Roman Polanski, Nick Cassavetes, Julie Taymor, Jean Jacques Annaud, Buck Henry, Roland Joffe, Bernardo Bertolucci, Buck Henry, John Milius, Rose McGowan, Dan Gordon and more. While he has branched out to become a board of director guy, it would be hard to imagine he won’t want to be in the center of the action with his long time clients.