Braidy founder sues board: Bouchard wants several board members removed
ASHLAND, Ky. — The Braidy Industries corporate saga continues as its founder is now suing the board to remove the people that removed him last month.
On Friday, Craig Bouchard filed suit in a Delaware court to exercise his rights under the company’s voting agreement to remove people from the board of the company.
Bouchard, founded Braidy Industries and was its CEO and president until March 1, when Braidy Industries put out a press release that he was stepping down but would remain on the board. The press release said that Braidy Industries president Tom Modrowski, who has been with the company since it started, would be the interim CEO and that board member Charles Price would be chairman of the board of Braidy Industries. The decision came on Jan. 28, after a board meeting.
The suit said that Bouchard has the “unequivocal right” to remove board members from their board seats including Price, Michael Porter, of the Harvard Business School, Christopher Schuh, of the MIT Department of Materials Science, and John Preston, of TEM Capital.
In a letter to shareholders, Bouchard cited material concerns regarding the judgment of the named directors as the rationale for his removal request.
Bouchard said his removal jeopardizes approximately $260 million in potential equity investments from new investors as detailed in the lawsuit. Furthermore, according to the lawsuit, following Bouchard’s removal, the referenced prospective investors may now have elected to wait for the resolution of the dispute over control of the company, with a planned investment of $60 million from “one of the world’s largest companies” sidelined because of Bouchard’s removal.
“I informed the board that the company had line-of-sight and was in discussion with investors to fund the entire $1.8 billion needed to build its mill in East Park, Ashland, Kentucky, in alignment with customer purchasing schedules,” Bouchard said. “It seems evident that the named defendants put three years of progress and stockholder value at risk. We must simply remove these individuals from the board, as they are no longer showing proper judgement and replace them with directors who have more experience in the areas that have now become critical to building the company. This is vital to investor confidence.”
He also said the board’s firing of several senior management members “created an urgent risk of irreparable damage that cannot be ignored or allowed to linger. The board members have placed the community of Ashland and North East Kentucky, suffering from job loss and the ensuing opioid crisis, at risk.”
He said that left him no choice but to file suit to remove the people named in the suit and is asking for an expedited consideration to complete the removal of these board members.
“I will designate and announce a talented and qualified new board shortly,” Bouchard said, adding that Braidy Industries was his idea. In the few years since its inception, the company acquired hundreds of acres of land, acquired three large manufacturing facilities and acquired two award winning ultra-high-strength powder metallurgy companies, all the while remaining debt free to this day.”
He said the board’s vision has changed, while his remains the same.
Also named in the suit is Commonwealth Seed Capital, an independent fund of the Kentucky government that invests in bringing industries to the state. It invested $15 million into the Braidy project.