Attached files
| file | filename |
|---|---|
| EX-99.1 - PRESS RELESE DATED AUGUST 30, 2013 - Plastic2Oil, Inc. | f8k083013ex99i_jbiinc.htm |
| EX-10.1 - SUBSCRIPTION AGREEMENT - Plastic2Oil, Inc. | f8k083013ex10i_jbiinc.htm |
| EX-10.2 - SECURED PROMISSORY NOTE - Plastic2Oil, Inc. | f8k083013ex10ii_jbiinc.htm |
| EX-10.4 - SECURITY AGREEMENT - Plastic2Oil, Inc. | f8k083013ex10iv_jbiinc.htm |
| EX-10.3 - WARRANT - Plastic2Oil, Inc. | f8k083013ex10iii_jbiinc.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): August 29, 2013
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JBI, Inc.
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(Exact name of registrant as specified in its charter)
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Nevada
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000-52444
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90-0822950
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(State or other jurisdiction
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(Commission
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(I.R.S. Employer
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of incorporation)
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File Number)
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Identification No.)
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20 Iroquois St
Niagara Falls, NY
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14303
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (716) 278-0015
N/A
Former name or former address, if changed since last report
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Section 1 – Registrant’s Business and Operations
Item 1.01 Entry into a Material Definitive Agreement.
On August 29, 2013, JBI, Inc., a Nevada corporation (the “Company”), entered into a Subscription Agreement (the “Purchase Agreement”) with Mr. Richard Heddle, the Company’s Chief Executive Officer and a member of the Company board of directors (the “Purchaser”), pursuant to which, on August 29, 2013, the Company sold to the Purchaser in a private placement (the “Note Financing”) a $1 million principal amount 12% Secured Promissory Note (the “Note”), together with a five-year warrant to purchase up to one million shares of the Company’s common stock at an exercise price of $0.54 per share (the “Warrants”). The gross proceeds to the Company were $1 million. In connection with the Note Financing, the Company and the Purchaser entered into certain agreements described below. The Company previously reported the entry into a term sheet with the Purchaser concerning the Note Financing. Some of the terms were modified in the final documentation described below and attached hereto.
Purchase Agreement
The Purchase Agreement contains customary representations, warranties and covenants in connection with the sale and issuance of the Notes and Warrants, including without limitation, representations and warranties of the Purchaser as to his “accredited investor” status.
12% Secured Promissory Note
The Note issued by the Company bears interest at the rate of 12% per annum. All principal and interest on the Note is due and payable in full by the Company on August 31, 2018, approximately the fifth anniversary of the issuance date. The Note may be prepaid in full or part at any time without penalty. Events of default under the Note include, without limitation, the failure to timely pay principal or interest when due and the commencement of a bankruptcy, liquidation or similar proceeding against the Company. The Company’s obligations under the Note are secured by a lien on substantially all of the assets of the Company and Plastic2Oil of NY#1, LLC and JBI RE #1, Inc., each a subsidiary of the Company.
Warrants
The Warrant issued by the Company has a five year term, is exercisable immediately, and has an initial exercise price of $0.54 per share of common stock, which price is subject to adjustment upon stock splits, stock combinations and the like. No registration rights were granted to the Purchasers in connection with the shares of common stock issuance upon exercise of the Warrant.
Security Agreement
In connection with the Note Financing, the Company, its subsidiaries named above, the Purchaser and Christiana Trust Company, as collateral agent, entered into a Security Agreement (the “Security Agreement”) pursuant to which the Company and subsidiaries granted a security interest in favor of the collateral agent and for the benefit of the Purchaser in substantially all of the assets of such grantors. Following an event of default (as defined in the Note), the collateral agent will act with respect to the collateral securing the Note at the direction of the holders of a majority of the aggregate principal amount of the outstanding Notes. If the Company sells additional Notes in the Note Financing, the purchasers of such Notes will become a party to the Security Agreement.
The foregoing summaries of the Note Financing, the securities to be issued in connection therewith, the Purchase Agreement, Note, Warrant and Security Agreement (all of the foregoing are collectively referred to as the “Transaction Documents”), do not purport to be complete and are qualified in their entirety by reference to the actual Transaction Documents, copies of which are attached to this Current Report on Form 8-K as Exhibits 10.1, 10.2, 10.3 and 10.4, respectively. The Transaction Documents contain representations and warranties that the parties made solely for the benefit of each other, in the context of all of the terms and conditions of the Transaction Documents. Accordingly, other investors, holders and stockholders of the Company may not rely on such representations and warranties. Furthermore, such representations and warranties are made only as of the date of the applicable Transaction Document. Information concerning the subject matter of such representations and warranties may change after the date of such Transaction Document, and any such changes may not be fully reflected in the Company’s reports or other filings with the Securities and Exchange Commission.
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Section 2 - Financial Information
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
Section 3 — Securities and Trading Markets
In connection with the Note Financing described in Item 1.01, the Company agreed to issue the Notes and Warrants described therein. Such issuances were made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Act”), and Regulation D promulgated thereunder on the basis that the issuances did not involve a public offering and the Purchasers made certain representations to the Company in the Purchase Agreements, including without limitation, that the Purchasers were “accredited investors” as defined in Rule 501 under the Act.
Section 8 — Other Events
Item 8.01 Other Events.
On August 30, 2013, the Company issued a press release to announce the closing of the Note Financing described in this Report, and an operations update on processor three. A copy of the press release is attached as Exhibit 99.1 hereto.
Section 9 — Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. The exhibits required by this item are listed on the Exhibit Index hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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JBI, Inc.
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August 30, 2013
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By:
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/s/ Nicholas J. Terranova
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Name:
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Nicholas J. Terranova
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Title:
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Chief Financial Officer
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EXHIBIT INDEX
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Exhibit
No.
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Description
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10.1
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Subscription Agreement.
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10.2
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12% Secured Promissory Note.
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10.3
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Warrant.
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10.4
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Security Agreement.
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99.1
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Press Release dated August 30, 2013.
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