UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13G
Under The Securities Exchange Act of 1934
(Amendment No. )*
RETAIL PRO, INC.
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(Name of Issuer)
Common Stock, par value $0.0001 per share
--------------------------------------------------------------------------------
(Title of Class of Securities)
76131K107
--------------------------------------------------------------------------------
(CUSIP Number)
February 29, 2008
--------------------------------------------------------------------------------
(Date of Event Which Requires Filing of this Statement)
Check the appropriate box to designate the rule pursuant to which this Schedule
13G is filed:
[ ] Rule 13d-1(b)
[X] Rule 13d-1(c)
[ ] Rule 13d-1(d)
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
CUSIP No. 76131K107
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(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
PSource Structured Debt Limited
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Guernsey
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,044,945*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,044,945*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,044,945
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 9.99%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
CUSIP No. 76131K107
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Laurus Master Fund, Ltd.
98-0337673
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Cayman Islands
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,044,945*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,044,945*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,044,945
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 9.99%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): CO, HC
--------------------------------------------------------------------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
CUSIP No. 76131K107
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Laurus Capital Management, LLC
13-4150669
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,044,945*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,044,945*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,044,945
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 9.99%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
CUSIP No. 76131K107
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Valens U.S. SPV I, LLC
20-8903266
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,044,945*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,044,945*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,044,945
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 9.99%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
CUSIP No. 76131K107
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Valens Offshore SPV II, Corp.
26-0811267
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,044,945*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,044,945*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,044,945
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 9.99%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): CO
--------------------------------------------------------------------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
CUSIP No. 76131K107
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Valens Capital Management, LLC
20-8903345
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,044,945*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,044,945*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,044,945
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 9.99%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
CUSIP No. 76131K107
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
David Grin
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Israel
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,044,945*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,044,945*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,044,945
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 9.99%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): IN
--------------------------------------------------------------------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
CUSIP No. 76131K107
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Eugene Grin
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: United States
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,044,945*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,044,945*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,044,945
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 9.99%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): IN
--------------------------------------------------------------------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
Item 1(a). Name Of Issuer: Retail Pro, Inc.
Item 1(b). Address of Issuer's Principal Executive Offices:
3252 HOLIDAY COURT, SUITE 226, LA JOLLA, CA 92037
Item 2(a). Name of Person Filing: Laurus Master Fund, Ltd.
This Schedule 13G is also filed on behalf of PSource Structured Debt
Limited, a closed ended company incorporated with limited liability in
Guernsey, Laurus Capital Management, LLC, a Delaware limited liability
company, Valens U.S. SPV I, LLC, a Delaware limited liability company,
Valens Offshore SPV II, Corp., a Delaware corporation, Valens Capital
Management, LLC, a Delaware limited liability company, David Grin and
Eugene Grin. Laurus Capital Management, LLC manages Laurus Master
Fund, Ltd. and PSource Structured Debt Limited. Valens Capital
Management, LLC manages Valens U.S. SPV I, LLC and Valens Offshore SPV
II, Corp. Eugene Grin and David Grin, through other entities, are the
controlling principals of Laurus Capital Management, LLC and Valens
Capital Management, LLC and share sole voting and investment power
over the securities owned by Laurus Master Fund, Ltd., PSource
Structured Debt Limited, Valens U.S. SPV I, LLC, and Valens Offshore
SPV II, Corp. Information related to each of PSource Structured Debt
Limited, Laurus Capital Management, LLC, Valens U.S. SPV I, LLC,
Valens Offshore SPV II, Corp., Valens Capital Management, LLC, Eugene
Grin and David Grin is set forth on Appendix A hereto.
Item 2(b). Address of Principal Business Office or, if None, Residence:
c/o Laurus Capital Management, LLC
335 Madison Avenue, 10th Floor
New York, NY 10017
Item 2(c). Citizenship: United States
Item 2(d). Title of Class of Securities: Common Stock
Item 2(e). CUSIP No.: 76131K107
Item 3. If This Statement Is Filed Pursuant to Sections 240.13d-1(b) or
240.13d-2(b) or (c), check whether the Person Filing is a:
Not Applicable
Item 4. Ownership:
(a) Amount Beneficially Owned: 6,044,945*
(b) Percent of Class: 9.99%*
(c) Number of Shares as to which the person has:
(i) sole power to vote or to direct the vote 0*
(ii) shared power to vote or to direct the vote 6,044,945*
(iii) sole power to dispose or to direct the
disposition of 0*
(iv) shared power to dispose or to direct the
disposition of 6,044,945*
-------------------
* Based on 60,509,964 shares of the common stock, par value $0.0001 per share
(the "Shares"), outstanding of Retail Pro, Inc., a Delaware corporation (the
"Company") as of October 31, 2007, as disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2007. As of February 28,
2008, PSource Structured Debt Limited ("PSource"), Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC, ("Valens US"), and Valens Offshore SPV II,
Corp. ("VOFF SPV II", and together with PSource, the Fund, and Valens US, the
"Investors") collectively held (i) 3,096,713 Shares, (ii) a warrant (the "First
Warrant") to acquire 3,750,000 Shares at an exercise price of $0.71 per Share,
subject to certain adjustments, (iii) a warrant (the "Second Warrant") to
acquire 250,000 Shares at an exercise price of $0.43 per Share, subject to
certain adjustments, (iv) a warrant (the "Third Warrant") to acquire 4,444,444
Shares at an exercise price of $0.23 per Share, subject to certain adjustments,
(v) a warrant (the "Fourth Warrant") to acquire 1,200,000 Shares at an exercise
price of $0.20 per Share, subject to certain adjustments, (vi) a warrant (the
"Option") to acquire 14,028,152 Shares at an exercise price of $0.01 per Share,
subject to certain adjustments, (vii) a warrant ("Option 2A") to acquire
1,125,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (viii) a warrant ("Option 2") to acquire 1,125,000 Shares at an
exercise price of $0.01 per Share, subject to certain adjustments, (ix) a
warrant ("Option 3") to acquire 1,706,250 Shares at an exercise price of $0.01
per Share, subject to certain adjustments, (x) a warrant ("Option 4")to acquire
1,000,000 Shares at an exercise price of $0.01 per Share, subject to certain
adjustments, (xi) a warrant ("Option 5", and together with (ii) - (x), the
"Warrants") to acquire 15,000,000 Shares at an exercise price of $0.01 per
Share, subject to certain adjustments, (xii) a secured convertible note ("Note
1") in the initial aggregate principal amount of $7,000,000.00, as amended,
which is convertible into Shares at a conversion rate of $0.08 per Share for the
first $688,955 converted and $2.00 for the remaining amount converted, subject
to certain adjustments and (xiii) a secured convertible note ("Note 2" and
together with Note 1, the "Notes") in the initial aggregate principal amount of
$3,200,000.00, which is convertible into Shares at a conversion rate of $0.08
per share for the first 1,066,666 converted and $2.00 for the remaining amount
converted, subject to certain adjustments. The Warrants (other than Option 5)
and the Notes each contain an issuance limitation prohibiting the Investors from
converting or exercising those securities to the extent that such conversion or
exercise would result in beneficial ownership by the Investors of more than
4.99% of the Shares then issued and outstanding (the "4.99% Issuance
Limitation"). Option 5 contains an issuance limitation prohibiting the Investors
from converting or exercising those securities to the extent that such
conversion or exercise would result in a beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation, and together with the "4.99% Issuance Limitation, the
"Issuance Limitations". The Issuance Limitations in the First Warrant, the
Second Warrant, the Third Warrant, the Fourth Warrant, the Option, Option 2 and
the Notes may be waived by the Investors upon at least 61 days prior notice to
the Company and shall automatically become null and void upon the occurrence
and/or continuance of an event of default that is either uncured or has
continued beyond any applicable period (as defined in and pursuant to the terms
of the applicable instrument). The Issuance Limitations contained in Option 2A,
Option 3, Option 4 and Option 5 may be waived by the Investors upon at least 61
days prior notice to the Company and shall become automatically null and void
following notice to the Company upon the occurrence and during the continuance
of an Event of Default (as defined in and pursuant to the terms of the
applicable instrument) Additionally, a waiver notice waiving the Issuance
Limitations in Option 5 shall only be effective if delivered at a time when no
indebtedness is outstanding to the Investors or their affiliates. PSource and
the Fund are managed by Laurus Capital Management, LLC. Valens US and VOFF SPV
II are managed by Valens Capital Management, LLC. Eugene Grin and David Grin,
through other entities, are the controlling principals of Laurus Capital
Management, LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by the Fund and the Investors
reported in this Schedule 13G.
Item 5. Ownership of Five Percent or Less of a Class:
Not Applicable
Item 6. Ownership of More Than Five Percent on Behalf of Another Person:
Not Applicable
Item 7. Identification and Classification of the Subsidiary Which Acquired
the Securities:
Not Applicable
Item 8. Identification and Classification of Members of the Group:
Not Applicable
Item 9. Notice of Dissolution of Group:
Not Applicable
Item 10. Certification
By signing below I certify that, to the best of my knowledge and
belief, the securities referred to above were not acquired and are not held for
the purpose of or with the effect of changing or influencing the control of the
issuer of the securities and were not acquired and are not held in connection
with or as a participant in any transaction having that purpose or effect.
SIGNATURE
---------
After reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true, complete and
correct.
March 7, 2008
-----------------------------------
Date
LAURUS MASTER FUND, LTD.
/s/ Eugene Grin
-----------------------------------
Eugene Grin
Chairman, President & Secretary
Attention: Intentional misstatements or omissions of fact constitute
Federal criminal violations (See 18 U.S.C. 1001)
CUSIP No. 76131K107
APPENDIX A
A. Name: PSource Structured Debt Limited
a closed ended company incorporated with limited
liability in Guernsey
Business Address: 335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Guernsey
B. Name: Laurus Capital Management, LLC, a Delaware limited
liability company
Business Address: 335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Delaware
C. Name: Valens U.S. SPV I, LLC, a Delaware limited
liability company
Business Address: 335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Delaware
D. Name: Valens Offshore SPV II, Corp., a Delaware corporation
Business Address: 335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Delaware
E. Name: Valens Capital Management, LLC, a Delaware limited
liability company
Business Address: 335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Delaware
F. Name: Eugene Grin
Business Address: 335 Madison Avenue, 10th Floor
New York, New York 10017
Principal Director of Laurus Master Fund, Ltd.
Occupation: Principal of Laurus Capital Management, LLC
Citizenship: United States
G. Name: David Grin
Business Address: 335 Madison Avenue, 10th Floor
New York, New York 10017
Principal Director of Laurus Master Fund, Ltd.
Occupation: Principal of Laurus Capital Management, LLC
Citizenship: Israel
CUSIP No. 76131K107
Each of PSource Structured Debt Limited, Laurus Capital Management, LLC, Valens
U.S. SPV I, LLC, Valens Offshore SPV II, LLC, Valens Capital Management, LLC,
Eugene Grin and David Grin hereby agrees, by their execution below, that the
Schedule 13G to which this Appendix A is attached is filed on behalf of each of
them, respectively.
PSource Structured Debt Limited
By: Laurus Capital Management, LLC
Individually and as investment manager
/s/ Eugene Grin
--------------------------------------
Eugene Grin
Principal
March 7, 2008
Valens U.S. SPV I, LLC
Valens Offshore SPV II, Corp.
By: Valens Capital Management, LLC
Individually and as investment manager
/s/ Eugene Grin
--------------------------------------
Eugene Grin
Principal
March 7, 2008
/s/ Eugene Grin
-------------------------------------
Eugene Grin, on his individual behalf
March 7, 2008
/s/ David Grin
------------------------------------
David Grin, on his individual behalf
March 7, 2008