Bolt founder Ryan Breslow proposed a settlement with investor Activant Capital this week that could end a lawsuit brought by Activant. The investor accused Breslow of adding $30 million to Bolt’s balance sheet in the form of personal debt and ousted board members when they urged Breslow to repay it.
Activant sued Breslow in July 2023 in Delaware court on behalf of Steve Sarracino, a former Bolt board member, alleging that Breslow ousted him and two other board members when they 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 make loan repayments.
Breslow’s $30 million loan was secured by Bolt, however, Breslow defaulted on the loan, according to the suit. Instead of canceling the shares he owned to repay the amount, Breslow allowed those millions of dollars to be taken out of Bolt’s accounts, according to the suit.
At the time, Bolt’s board 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 Activant.
In March 2023, Breslow removed them all from the board and appointed people deemed more sympathetic to his cause, including musician Larrance Dopson, journalist Esther Wojcicki, and cryptocurrency investor Brock Pierce. All three left the board and were replaced by other Breslow acquaintances.
Kuruvilla himself was later removed as CEO in March 2024 and replaced by Bolt sales chief Justin Grooms.
At the same time as Activant’s lawsuit, the US Securities and Exchange Commission was investigating Bolt and Breslow over whether federal securities laws were violated in connection with statements made when Bolt was raising money in 2021.
That emerged in a letter sent by Reinken and Sethi, who were Series C and B investors, respectively, to Bolt’s general counsel as part of a demand to inspect the company’s records.
The letter alleged that Breslow “misled” investors in raising funds 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 returned calls for comment at the time of publication.
Now, according to the settlement plan seen by TechCrunch, Bolt will cancel 13,397,270 common shares previously owned by Breslow, representing $37,378,383. Breslow is essentially giving those shares back to Bolt to settle the principal, expenses and interest.
For Activant’s part, the company said it chose not to participate in an auction and instead, Bolt will buy 18,247,337 of Activant’s shares valued at $36,494,674.
