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Bolt founder Ryan Beslow wants to settle a lawsuit against an investor by returning $37 million in stock.

Bolt founder Ryan Breslow this week proposed a settlement with investor Activant Capital, which could end a lawsuit filed by Activant. The investor accused Breslow of adding $30 million to Bolt’s balance sheet in personal debts and removing board members when they urged Breslow to pay them off.

Activant sued Breslow in July 2023, in a Delaware court, on behalf of Steve Sarracino, a former Bolt board member, alleging that Breslow removed him and two other board members when they had refused to help Breslow repay the $30 million loan. Sarracino’s suit also alleged that CEO Maju Kuruvilla and three subsequently appointed board members failed to force Breslow to repay its loan.

Breslow’s $30 million loan was guaranteed by Bolt, but Breslow defaulted on the loan, according to the suit. Instead of canceling the shares he owned to repay the sum, Breslow allowed those millions of dollars to be withdrawn from Bolt’s accounts, according to the lawsuit.

At the time, Bolt’s board of directors consisted of Breslow, Maju Kuruvilla (who replaced Breslow as CEO in January 2022), Brian Reinken of WestCap Management, Arjun Sethi of Tribe Capital Management and Steve Sarracino of Activating.

In March 2023, Breslow removed them all from the board and appointed people considered more sympathetic to his cause, including musician Larrance Dopson, journalist Esther Wojcicki, and crypto investor Brock Pierce. All three have since left the board and been replaced by other Breslow acquaintances.

Kuruvilla himself was subsequently removed as CEO in March 2024 and replaced by Justin Grooms, Bolt’s head of sales.

Concurrent with the Activant lawsuit, the U.S. Securities and Exchange Commission was examining Bolt and Breslow to determine whether federal securities laws were violated in connection with statements made when Bolt was raising money in 2021.

This stems from a letter sent by Reinken and Sethi, who were Series C and B investors, respectively, to Bolt’s general counsel as part of a request to inspect the company’s records.

The letter alleged that Breslow “misled” investors during fundraising for the company’s $355 million Series E round, valuing the company at $11 billion. The investigation against Bolt was later dropped.

Neither Breslow nor a representative for Activant responded for comment at the time of publication.

Now, according to the settlement plan seen by TechCrunch, Bolt will cancel 13,397,270 shares of common stock previously owned by Breslow, representing $37,378,383. Breslow essentially returns these shares to Bolt to settle the loan principal, expenses, and interest.

On the Activant side, the company said it had chosen not to participate in a tender offer and that, instead, Bolt would repurchase 18,247,337 shares of Activant worth 36,494,674 $.

techcrunch

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