2001 115 4 stroke flywheel nut came off

Pre-Fishing friday for a tourney on Saturday and my buddies motor made metal grinding noise at take off after fishing half the day and 20 min boat ride to the lake that morning. Pull the cowl when we see and smell melted plastic. The plastic guard over the flywheel and belt is melted over the flywheel. After looking around the motor i find a washer at the bottom of the housing. Pull off the plastic guard and see the flywheel bolt missing and a very hot flywheel. finally find the bolt at the bottom/base of the block. After a little cooling time i turn the flywheel with my hand and you can here the magnets under the flywheel grinding and upon closer inspection i find little magnet fragments on the top of the motor. My Thoughts: did the bolt and washer work loose and bounce around and damage the magnets or did something else fault causing the flywheel area get hot and cause the flywheel nut to loosen? Any Ideas?

Unusual. It's difficult to know what went on there but it would be interesting to know if your flywheel had been off at any time for service work. Belt, stator? In all probability you are going to need a new flywheel, stator, and even a crankshaft now. Questionable expense on a 2001 motor.

Please take some pictures if you could and maybe a video of the engine with the cover off and it running.

Unless the flywheel has popped off the tappered shaft, the magnets should not be grinding on anything. I would like to see the video of the engine running to see if the flywheel is spinning true without a wobble.

sorry for the late update, shop stated the flywheel nut did the damage. rear the nut came off but had to replace the flywheel and stator. went with used parts. $800 and fishing again. The boat had no service since bought so the nut coming off is a mystery.