EMPLOYMENT AGREEMENT by JBI, INC.
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Company: JBI, INC.
SEC CIK: 1381105
SEC Type: EX-10.3
SIC Code: 5064
SIC Industry: WHOLESALE-ELECTRICAL APPLIANCES, TV & RADIO SETS
Date Filed: 2012-05-17
Date Filed:
05/17/2012 SKU: RDQ0NG-C-24S-4
Exhibit 10.3
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made and entered into, effective May 15, 2012 (the
"Effective Date"), by and between JBI, Inc., (the "Company"), and Kevin Rauber (the
"Employee").
ARTICLE I - EMPLOYMENT
1.1 Employment. The Company hereby employs the
Employee, and the Employee hereby accepts employment with the Company, upon the terms and
conditions set forth in this Agreement.
1.2 Term. The term of this Agreement shall begin
on the Effective Date and shall continue for a period of three (3) years after the Effective Date,
unless this Agreement is terminated as provided for herein.
1.3 Title. Employee shall be the President and
Chief Executive Officer of the Company.
1.4 Duties. The Employee shall do and perform all
services, acts or things necessary or advisable to manage the Company. This will include Employee
being expected to oversee, execute and manage the rollout of JBI's business plan with Rock-Tenn.
Employee shall loyally, conscientiously, and professionally perform all of his duties and
responsibilities, which may be revised from time to time, as Company deems appropriate or
necessary. At all times during his employment, Employee shall adhere to all rules, policies, and
guidelines of Company that are now in effect or as they may be modified by the Company's
management, in its sole discretion, from time to time. The Employee agrees that the hiring of one
operations senior executive by the Company is considered essential to performing his duties. No
other senior management hires are permitted until the Company has a minimum of six processors
running consistently, unless such hire is made out of commercial necessity and agreed to by the
Board of Directors of the Company. While employed by Company, Employee shall not, directly or
indirectly, render any services of a business, commercial or professional nature to any other
person, firm or organization, whether for compensation or otherwise. Employee will sign all
environmental permitting document on behalf of the Company in his capacity as CEO/
President.
ARTICLE II - COMPENSATION
2.1 Base Salary. Company shall pay Employee, and
Employee shall accept an annual base salary of Two hundred and Fifty Thousand Dollars
($250,000.00), payable weekly in 52 equal installments, subject to standard withholding and other
deductions required by law.
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2.2 Signing Bonus. On the Effective Date of this
Agreement, Employee shall receive Five Hundred Thousand (500,000) options to purchase shares of the
Company's common stock, vesting in equal annual installments beginning one year from the Effective
Date for five years as follows.
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Vesting one (1) year from the Effective Date; 100,000 options to purchase common stock at $1.50 per
share
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Vesting two (2) years from the Effective Date; 100,000 options to purchase common stock at $1.50
per share
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Vesting three (3) years from the Effective Date; 100,000 options to purchase common stock at $1.50
per share
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Vesting four (4) years from the Effective Date; 100,000 options to purchase common stock at $1.50
per share
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Vesting five (5) years from the Effective Date; 100,000 options to purchase common stock at $1.50
per share
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At the time of exercise, the Employee will have the option to issue payment to the Company for the
option price times the number of options being exercised. For example, if the Employee exercises
100,000 options, Employee would provide cash in the amount of $150,000 to the Company and in turn
receive 100,000 shares of JBI Common Stock.
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Additionally, the Employee can perform a cashless exercise, in which the total number of shares to
be issued will be offset by the amount the Employee would be required to remit to the Company. For
example, if 100,000 shares are exercised when the price of the Company's common stock is $5.00,
then the Employee would receive Common Stock in the amount of the options exercised multiplied by
the market price less the number of options exercised multiplied by the $1.50 per option
(100,000*$5.00) - (100,000*1.50) = $350,000 of shares of JBI Common Stock (valued at the market
price on the date of exercise).
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The term of the options will be seven (7) years from the date of vesting;
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All options, vested and unvested, will immediately vest upon the change in voting control of the
Company, other than any change in voting control of the Company resulting from (i) the transfer of
the Series A Super Voting Preferred Stock of the Company from Mr. John Bordynuik to any of the
other parties signatory to a letter agreement dated May __, 2012 between Mr. John Bordynuik and the
other parties signatory thereto; and (ii) the redemption or purchase of such Series A Super Voting
Preferred Stock by the Company.
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The Company will have a formal stock compensation plan in place within one month of the Effective
Date of this agreement under which these options will be formally issued.
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2.3 Performance Bonus. Beginning one year after
the Effective Date of this Agreement and annually thereafter while employed, Employee shall receive
a performance bonus equal to the Base Salary multiplied by the JBI Share Price divided by $10. For
these purposes, the JBI Share Price shall be the weighted average share price in the month prior to
the annual bonus date. The bonus shall be payable in JBI stock, with the value of the each JBI
share equal to the JBI Share Price for the purposes of calculating the number of JBI shares.
Employee will have the option to receive up to $100,000 of the Performance Bonus in cash. Such cash
payment will be approved based on the Company's consolidated cash balances being greater than $5
million at the time of the Performance Bonus payment.
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2.4 Employee Benefits. In addition to the
compensation specified above, the Employee shall be entitled to the benefits generally made
available by the Company to management employees, including but not limited to health insurance and
dental insurance, subject to the terms, conditions, and limitations governing those programs.
Employee's health and dental insurances will allow for coverage in St. Louis, MO. If the Company
does not have a national health and dental plan in place at the Effective Date, the Company will
reimburse the Employee for costs of COBRA. In addition, Employee shall be provided with a computer
and cell phone at company expense.
2.5 Vacation. Employee shall be entitled to four
weeks paid vacation during the term of this Agreement.
2.6 Expenses. The Company shall reimburse Employee
for all reasonable expenses incurred by Employee during the Term in the course of performing
Employee's duties under this Agreement and which are sought in accordance with the Company's
reimbursement policies in effect from time to time.
ARTICLE III - TERMINATION OF EMPLOYMENT
3.1 Grounds for Termination.
3.1.1 Termination by the Company. Employee's
employment with the Company is not at will but may be terminated by the Company either for "Cause"
(as defined below), or without Cause. In either event, Employee's compensation upon such
termination is limited to the compensation expressly provided for in this Agreement. The Company
may terminate Employee's employment under this Agreement by delivery of written notice to the
Employee specifying the nature of the termination and, if applicable, the Cause or Causes relied
upon for such termination. Any such notice of termination shall effect termination as of the date
specified in the notice, except as otherwise extended to the last day of any applicable cure
period(s) provided below.
3.1.2 Termination for Death or Disability.
Employee's employment with the Company
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