Replies to post #78437 on Plastic2Oil Inc (PTOI)

[Johnik]

I think you went beyond “reading into” what I was saying, but that is not a point worth discussing.

Here is a tip for you though. Rather than reading and quoting from another message board poster’s selective (and reorganized) presentation of the filings, try going straight to the underlying documents. Context is quite valuable when interpreting the intended meaning of specific statements.

Let’s consider some of the examples raised by people as demonstrative of corporate improprieties. How about these posts?

I guess the SEC and FINRA have been digging around for awhile now if there has been a "flurry of requests" already.
Maybe that is why there are so many shares available at .60ish?

Quote from JB's emails filed in the recent court case.
in the past so the SEC looks at these closely which will then in turn cause greater flurry of requests to come from FINRA and the SEC.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57080646

Don't you wonder what the requests from FINRA and the SEC were? I sure do. Not a good thing when both regulators are showing interest much less one, that is for sure.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57082849

Really, the SEC and FINRA have been making a large number of “requests” of JBI? Is the poster suggesting that some form of investigation is underway?

Let’s add some of the omitted language from the email in question to see if it illuminates the meaning of the CEO’s statement.

My concern is how to deal with the employee stock option plan and salary. Cash salaries hit the bottom line hard and don’t look like value-based management. The SEC created S-8 stock (or options) stock to allow a growth company to grow without having to pay exec salaries because the S-8 stock can be sold into the market as cash. They are securities registered for sale the moment I file it. They have been abused in the past so the SEC looks at these closely which will then in turn cause greater flurry of requests to come from FINRA and the SEC.

http://viewer.zoho.com/docs/g4bpaf


Wow, look at that! The CEO was expressing concerns related to the use of a particular form of employment compensation, raised during pre-contract discussions with an employee. I would think it is a good thing that the CEO is giving careful consideration to regulatory compliance concerns when discussing potential employment contract terms.

Now let’s look at the language that you have cited as establishing stock market manipulation, but add some more context taken verbatim from the filing.

Our auditor (Withum) advised there are accounting control issues in Ohio with the accountant and Judy Vasquez (CEO).

UBS (VP Investments) and UMB Bank Fund managers and analysts have advised that this might be the next Henry Singleton and UBS is on the market makers because they believe we are the best stock going. That said, we need to keep the wholly owned subsidiaries in tact, remove accounting to centralized accounting to Philly and have Ron’s team implement controls and reporting/consolidations.

I’ve merged PakIt with our group to work as one. . . .

Okay, so some investment banks spoke favorably of the company, and the CEO expressed the goal of centralizing some operations and implementing accounting controls. You consider that stock market manipulation? Sounds to me like working on efficiency.

Here is the other statement you raised (which preceded the last one by several paragraphs in the email).

I have been doing the public market strategy which is working. I will continue to bring the market price up but we’ll need earnings behind in the short term to keep the momentum with the market. I can keep us at a 1000x multiple with perfect execution of P2O. I need other acquisitions to build a floor on the stock.

This statement leaves the most room for interpretation. I think we can agree that the CEO is likely referring to keeping the market price of the stock up. Of course all CEOs want to do that. What I don’t see is why you think the CEO wishes to keep the price up based on expectations, rather than delivery. Doesn’t he clearly state that he needs “perfect execution of P2O” to maintain a high share price? Is execution not akin to delivery? And how do you infer from this that the CEO is disregarding earnings (or viewing them as secondary)? Keep in mind that you are looking at a single email (or select portions of a single email) that was undoubtedly part of an ongoing exchange of communications between two corporate agents; it is not tantamount to a business plan. Stability, growth, and efficiency should be at the forefront of any start-up’s plans, and I think the emails embody each of those concern. Note that the remainder of that email you quoted focuses on increasing margins (i.e., profit), consolidation of operations, and implementing monitoring and accounting controls.

Context is essential. If you haven’t already, I encourage you to read the actual documents, keeping in mind that the documents at issue have been pieced together as part of a former employee’s case against the company and CEO for allegedly failing to fulfill obligations in connection with the employment arrangement.

In any event, have a nice Thanksgiving. I hope we engage in thoughful and cordial discussions in the future.

[scion]

OCR Doc 15-1 : Case 8:10-cv-02140-EAK-AEP Document 15-1 Filed 11/23/10

Pages 8 to 20

P8

Case 8:10-cv-02140-EAK-AEP Document 15-1 Filed 11/23/10 page 8 of 20 - Attachment 1

MICHAEL KAPLANIS

From: John Bordynuik [[e-mail]]
Sent: Sunday, January 31, 2010 11:58 AM
To: Michael Kaplanis
Cc: Geoffrey C. Weber
Subject: Re: Follow up

The following list is highly confidential and is what I have been working on the past five weeks -- I have been doing the public market strategy which is working. I will continue to bring the market price up but we'll need earnings behind in the short term to keep the momentum with the market. I can keep us a 1000x multiple with perfect execution of PZO. I need other acquisitions to build a floor on the stock. Due to the material nature of these releases only my core group know of this list below(including Geoff).

Please don't trade the stock during the next 3 weeks -- you can expect FINRA to pull all the transactions after this massacre.

A few other notes about what my strategy is internally:

Power Plays: There have been a few between Steve Seneca (Paklt) and others who wish control. I know you are moving to Florida but JBI Admin and Executive are being scattered all over North America. I don't believe we need a centralized office other than Accounting Controls (limited to compliance and reporting only -- Florida). We do things differently so don't be afraid to do something that makes the market cringe at first... We have a great track record and the market is liking what we are building. It can take them time to get their heads around what we are doing sometimes.

Finance: Ron Baldwin is perfect for maintaining 100% accurate books and reporting. Ron is not involved in financial models or financing and is not entrepreneurial. He is amazingly bright and the best at what he does. I have been financing the company and meeting with investment banks. I'd like you, I and Geoff to handle this in the future. I'd like to rip out the accounting depts in every company we acquire and centralize the day-to-day accounting through Philly and have Ron's team handle the consolidation, monitoring, controls, etc... Javaco is a prime example with low margins and a mom and pop business. They pay these people too much and we can't get value for it. As well, I generally find the mom and pops have a loyalty to long-time employees and this costs us. I am setting up centralized bank accounts for all entities and Ron Kurp and I are signers for all. Jacob Smith is an excellent COO and is handling Paklt operations at this time. Jacob is finding us an accountant in Philly who will handle receivables/payables for all the entities.

Javaco: I advised Linda Burr that if we can eliminate some people at Javaco then we can bring her on fulltime. She can support you in FL. I do believe the accotmtant and marketing employees in Ohio should go and our team needs to do this soon. Our auditor (Withum) advised there are accounting control issues in Ohio with the accountant and Judy Vasquez (CEO).

UBS (VP Investments) and UMB Bank Fund managers and analysts have advised that this might be the next Henry Singleton and UBS is on the market makers because they believe we are the best stock going. That said, we need to keep the wholly owned subsidiaries in tact, remove accounting to centralized accounting to Philly and have Ron's team implement controls and eporting/consolidations.

I've merged Paklt with our group to work as one. This has worked out really well. We will be making some changes in Philly with the office staff soon.

Please call me with any questions - you'll be on a conference call Feb 13th with the Board and I. I am hoping 1

Case 8:10-cv-02140-EAK-AEP Document 15-1 Filed 11/23/10 Page 9 of 20

we can add-&- as an acquisition for the 12th of Feb (not listed).

** I am getting married on Feb 14th and will be on a honeymoon from 15-22 so it's good I won‘t be around for a week after we release the following news:

(*) means this is likely to close on Feb 12
(#) means this is REALLY likely close on Feb 12
(‘?) means this might close on Feb 12

All PR's to be released after hours (6 hours apart) over Valentines Day Weekend & Monday, Tues and Wed:

1. (*-> #) Massive fuel blending and distribution site. Has lM+ gallon storage on site with top and bottom loading. Can handle $300M/year in fuel. I just got the go ahead from Ministry of Environment, and TSSA (for fuel tanks), the city caved yesterday and will allow us to operate. In the past this site has done $30M/month. From a retired wealthy shareholder. The deal $150k token -- he likes what 1 am doing.

2. (#) Hired Mike Koblanis VP M&A

3. (#) Appoint Board & Committees for compliance. (4 PR's)

4. (‘?) Purchased a ship in China

5. (?) Announce Captain Mike Moneyhan (shareholder -- captainmike on ihub) is hired as JBI master
captain and will sail P20 ship.

6. (?) Announce P20 ship is in China get retrofitted with machines.

7. (#) Islechem announcement (3rd party validation).

8. (#) P20 is running on continuous operation.

9. (#) Heddle Agreement Signed.

10. (#) Al Sousa Agreement signed.

11. (#) Purchase building in Niagara Falls NY for processing. 20 Iroquois, Niagara Falls, NY. $l00k down, $270k loan. is primary P20 site.

12. (#) AGM meeting is set for April 24, 2010 and shareholders can attend and view the processor running.

13. (#) Conference call for February 13, 2010.

14. (#) Hired Scott Kobyrn (VP Systems - Processing) -- Scott designed and built a magnesium processing plant and designed our continuous feeding system.

Case 8:10-cv-02140-EAK-AEP Document 15-1 Filed 11/23/10 Page 10 of 20

15. (#) ASTM fuel from continuous processor
On Sat, 2010-01-30 at 18:33 -0600, Michael Kaplanis wrote:
Hi John,

I was thinking we call it “Executive Vice President of Mergers, Acquisitions and Strategy.”

The M&A portion of the title implies that I would be responsible for identifying and assessing
potential mergers and acquisitions, managing interactions with the banking and investment communities on strategic transactions, and leading the execution of any transactions the Company (Viacom used this description-I thought the language fit).

I was looking to add the Strategy name to describe all other activities that I would do to assist you and the company grow and add value. It is broad-I envision that my role will be broad as I look to add shareholder value.

At the end of the day, a title is just a title. This is just my suggestion.

I am so excited to start and be a part of the team and this is much more important to me than a title! Thank you for the opportunity!

Best,
Michael


On Sat, Jan 30, 2010 at 3:45 PM, John Bordynuik < [e-mail] > wrote:

We are a go.

$l20k & l'll issue 100k shares from my stock.

You'll have an agreement this weekend. Please execute and we proceed. l'll send the job description with it.

Gregg has helped on this...
Your title should be: VP Mergers & Acquisitions or VP ??


Case 8:10-Cv-02140-EAK-AEP Document 15-1 Filed 11/23/10 Page 11 of 20


On Thu, 2010-01-28 at 17:57 -0600, Michael Kaplanis wrote:

Hi John,

I hope you are well. Geoff gave me your cell and I left a message. I think Geoffs advice to both of us is to keep it simple. I agree with him. You and I have agreed to the terms, and think we are very
close to making this finalized.

I'd like to hit the ground running with you and making myself helpful ASAP. I'm available anytime tonight. My cell is XXXXXXXXXXXXX

Talk to you soon,
Michael


Case 8:10-cv-02140-EAK-AEP Document 15-1 Filed 11/23/10 Page 12 of 2O Attachment 2

Michael KapIanis
--------------------------------------------------------------------------------------------------------------

From: John Bordynuik [ [e-mail] ]
Sent: Thursday, January 28, 2010 11:52 AM
To: Michael Kaplanis
Cc: Geoff Weber
Subject: Re: Contract

Hello Mike,

"We can remove the paragraph about severance that appears in Ron's contract."
Are you referring to the Escrow of funds?

I will provide the agreement I used for Jacob and Ron Kurp. The stock is coming from my holdings so the exchanges can't get funny about it. It is 500k out of my pocket so I am dealing with Gregg on the agreement.

My concern is how to deal with the employee stock option plan and salary. Cash salaries hit the bottom line hard and don't look like value-based management. The SEC created S-8 stock (or options) stock to allow a growth company to grow without having to pay exec salaries because the S-8 stock can be sold into the market as cash.They are securities registered for sale the moment I tile it. They have been abused in the past so the SEC looks at these closely which will then in turn cause a greater flurry of requests to come from FINRA and the SEC.

Our problem at this time is how implement a stock option plan without creating precedents I can't support. Baldwin is a prime example with "salary in escrow". He has no stock though...

I appreciate your research on the matter and I am looking into how we can compensate everyone and include room for new execs. If we can hammer a plan out then I believe it will work.

Do you have time this afternoon do discuss how we can accomplish this with you & everyone else? I would like to bring you on board ASAP.


On Thu, 2010-01-28 at 10:21 -0600, Michael Kaplanis wrote:

John,
I was looking at Ron Baldwin's contracting in the 8-K from October. It looks like this could be a good framework for my contract. We can remove the paragraph about severance that appears in Ron's contract. We can discuss employee contract terms, but I’m open to what you think makes sense.

Also, I was unsure if the gifting of the 100,000 share would be written in this agreement or if this would be a separate contract between you and I. If it needs to go in the Employment Agreement, let me know if you would like me to try to write this section.

Case 8:10-cv-02140-EAK-AEP Document15-1 Filed11/23/10 Page13 of 2O

Let me know if I can be helpful in any way. Since we agreed to terms in our conversation this morning, it is my understanding that we just need to make it a formality. I am looking forward to being a part of the team!

Regards,
Michael

Case 8:10-Cv-02140-EAK-AEP Document 15-1 Filed 11/23/10 Page 14 of 20 Attachment 3

Michael Kaplanis
-----------------------------------------------------------------------------------------------------------

From: John Bordynuik [[e-mail]]
Sent: Sunday, January 31, 2010 8:00 PM
To: Michael Kaplanis
Subject: Employment Agreement
Attachments: Michael Kaplanis_-_emp|oyee_agreement.doc

Hello Michael,

Attached is your employment agreement. Please review.

I am not going to waste your time or mine with a detailed job description. You have skin in the game so let's have fun. We need xxx and xxx ASAP.

Geoff also needs a lot of assistance with the P20 rollout. I’ll finance the stock options out of the shares I returned to the treasury which is a way I can get paid in the future (finally figured that out).

We used this agreement for Ron Kurp, Jacob, and about 5 other employees. Quite generic but works for the public market.

We'll get value based management structured soon so that we all can get paid for growth.

Please review the PR that will be released Feb 13 after hours.

Regards,

John Bordynuik
CEO
JBI


On Sun, 2010-01-31 at 09:22 -0600, Michael Kaplanis wrote:

Hi,
The movers will be able to get us out either Thursday or Friday and as soon as the apartment is cleaned up we will drive down to Florida. Next weekend for use.

My wife has a Mac which I could use for information gathering this week, but I will need a laptop for work purposes that I can use for work. Citadel had provided me with a laptop. Let me know if I should buy one and expense it or if the company can provide me with one this week.

Case 8:10-cv-02140-EAK-AEP Document15-1 Fi|ed11/23/10 Page15 of 2O

1) Since the transactions for Watsco were generally considered "mom & pops" there will probably be varying information on the the financials from the public documents. However, the research I had seen was specific on the 5-7x multiples, so I will dig in to see what details are out there xxx probably a premium for the filtration and their past clients).

2) Geoff; can we chat about xxx later today?

3) 1'll see what I can do with respect to the amount of plastic in the counties from afar. The feasibility study that I found for Pinellas is likely to be very helpful. The study measured the actual plastics that go through the recycling program, but obviously this is just a fraction of the plastic (waste in landfill, medical, etc.).

Glad to be on board!

Michael


On Sun, Jan 31, 2010 at 8:27 AM, Geoff Weber < [e-mail] > wrote:
John/Michael:

Priorities for Michael as I see them. Michael - let me know ASAP when you expect to be in FLA. Also, do you have a laptop or does the company need to provide you one?

Here we go (John, correct me if I am missed something):

1) Find back up detail for supporting "times earnings multiple" for the purchase of xxx We've discussed using an all stock where both J BI stock and xxx go in escrow and there's a put/call provision that allows xxx rescind the deal if, after two years, they're not happy and JBI has a similar option. I'm working on a formula for this. (As you previously found, Watsco and Carrier would have SEC filings to track)

The key here is that whatever we agree to pay has to be based upon a reasonable multiple and want as much back up detail as possible to support the price.

2) xxxx am supposed to hear from xxx today...if I don't I will initiate contact. I don't fully understand his business model but Michael you can start with their website and see what you can dig up.

It’s interesting that Steve's contact is- but the company founder, President and CEO is his wife (this may be because of "woman owned incentives" but Steve thinks "she wears the pants".

Also they have no physical address so the value here must be in their customer list and the concept - not in the product itself (since apparently we have been able to duplicate and/or improve it...

http://www.xxxxxxxxxxxabout_us.php

Case 8:10-cv-02140-EAK-AEP Document15-1 Filed11/23/10 Page16 of 2O

John - any words of wisdom for Michael's research on xxxxx

3) We want to button up our P20 Area Development Agreement with Al Sousa simultaneously with at least one owner/operator "sub-license" for Pinellas County xxxxxxx and maybe for Pasco County , Sarasota, Manatee xxxxxxxx and Lee/Collier xxxxxxxx. [hey, do you guys notice a trend in the names of prospects?]

If we hurry we could enter into Reservation Agreements with as many as l0 to I2 operators who might put up $100,000 each to "reserve" space in the market. I don't want to do this unless we understand where their plastic will come from and how many sites a territory will support if we provide a 10 year license.

Michael - we need t look closely (in this order) l) Pinellas, 2) Pasco, 3) Lee and Collier, 4) Hillsborough

For these counties we need to know how much plastic discard there is now, how much is being recycled (and how) and how quickly could an operator grow the county.

The attached excel spreadsheet shows basic assumptions I have made based upon population and the EPA 2007 report that quantities discards at 6/ l0ths of a pound per person per day. I think if we dig deeper we'll fmd that the actual number is closer to 4 lbs per day when factoring in industrial and medical waste. Medical waste could be big and easy to get...this is an area where Al has expertise.

We want to try to get these details on these counties this week so we can try to close Reservation Agreements next week.

We also have prospects working in WI, IL, Atlanta, California, Utah, Europe .... but our best prospects so far are in our back yard and if you’re going to be in Florida we'll want you talking directly to the MSW or Utility directors in these counties to track down details of where plastic is now going - and the how we get it

4) I have another call today with xxxxxxx this was at his request via email yesterday afternoon. Since I can't provide any technical advice I'm thinking maybe the seeds I have planted about us providing funding or working through a restructure may have germinated...we'll see what he has to say and go from there.

Michael - once again, welcome aboard and let's get busy :)

Geoffrey C. Weber
[e-mail]
Bayshore/Broadway, Inc.
221 Turner Street
Clearwater, FL 33756
Phone: [phone]
Fax: [phone]


Case 8:10-Cv-02140-EAK-AEP Document 15-1 Filed 11/23/10 Page 17 of 20 Attachment 4


Pages 17 to 20 are a REPEAT OF PAGES 8 to 11 (above)

---------------------------------------

Doc 15-1 PDF file
http://viewer.zoho.com/docs/g4bpaf