Bolt founder Ryan Breslow this week offered a settlement with investor Activant Capital that might end the lawsuit filed by Activant. The investor accused Breslow of adding $30 million to Bolt’s balance sheet in the form of personal debt and removing board members when they urged Breslow to repay it.
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 refused to help Breslow repay a $30 million loan. Sarracino’s lawsuit also alleged that CEO Maju Kuruvilla and three board members appointed later failed to force Breslow to repay the loan.
Breslow’s $30 million loan was secured by Bolt, but Breslow failed to repay the loan, the lawsuit alleged. Instead of redeeming his stock to repay the amount, Breslow allowed those hundreds of thousands of dollars to be removed from Bolt’s accounts, according to the lawsuit.
At the time, Bolt’s board of directors included 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 Activant.
In March 2023, Breslow removed all of them from the board and appointed people considered more sympathetic to his cause, including musician Larrance Dopson, journalist Esther Wojcicki and cryptocurrency investor Brock Pierce. All three have since left the board and been replaced by other of Breslow’s friends.
Kuruvilla himself was later removed as CEO in March 2024 and replaced by Bolt’s chief sales officer, Justin Grooms.
At the same time as the Activant lawsuit, the U.S. Securities and Exchange Commission was investigating Bolt and Breslow for violating federal securities laws for statements they made during Bolt’s 2021 fundraiser.
This resulted from a letter sent by Reinken and Sethi, Series C and B investors respectively, to Bolt’s general counsel requesting access to the company’s records.
The letter alleged that Breslow “misled” investors while raising funds for a $355 million Series E round, valuing the company at $11 billion. The investigation against Bolt was later dropped.
Neither Breslow nor an Activant representative responded for comment at the time of publication.
Now, under the settlement plan reported by TechCrunch, Bolt will retire 13,397,270 shares of common stock previously owned by Breslow, representing an amount of $37,378,383. Breslow essentially gives these shares to Bolt to repay the principal loan, expenses and interest.
For Activant’s part, the company said it is not participating in the tender offer and that Bolt will as an alternative purchase 18,247,337 shares of Activant worth $36,494,674.