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EXHIBIT 10.1
DEBENTURE AND WARRANT PURCHASE AGREEMENT
This
Debenture and Warrant Purchase Agreement (this “
Agreement
”), dated as of June 27, 2008, is made by and
between Retail Pro, Inc. (the “ Company
”) and Midsummer Investment Ltd. (the “
Purchaser
”) .
For
good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereby agree as
follows:
1.
Issuance of
Debenture and Warrant . The Company hereby agrees to
issue to the Purchaser against payment therefor as described
herein, (a) a debenture of the Company in the aggregate
principal amount of $500,000, which debenture shall be in the
form of Exhibit A
attached hereto (a “ Debenture
”) and (b) Warrants to purchase an aggregate of up to
3,000,000 shares of Common Stock, with an exercise price per
share equal to $0.01, which warrant shall be in the form of
Exhibit B
attached hereto (the “ Warrant
”). The total purchase price to be paid by
the Purchaser for the purchase of the Debenture and the
Warrant is $500,000 (the “ Subscription
Amount ”). Subject to the terms and
conditions hereunder, at the closing, the Company shall
deliver to the Purchaser the Debenture and the Warrant, and
the Purchaser shall deliver the Subscription Amount to the
account designated in writing by the Company.
2.
Documents.
(a) The
rights and obligations of the Purchaser and of the Company
with respect to the Debenture, the Warrant and the shares of
Common Stock issuable under the Debenture and Warrant (the
“ Underlying
Shares ”) shall be identical in all respects to
the rights and obligations of the Purchasers and the Company
with respect to the debentures, the warrants and the
underlying shares issued pursuant to that certain Securities
Exchange Agreement dated June 13, 2008 among the Company and
the Purchaser (the “ Exchange
Agreement ”). Defined terms not otherwise defined
herein shall have the meanings set forth in the Exchange
Agreement.
3.
Representations
and Warranties of the Company . The Company
hereby makes to the Purchaser the following representations
and warranties:
(a)
Authorization;
Enforcement . The Company has the requisite
corporate power and authority to enter into and to consummate
the transactions contemplated by this Agreement and otherwise
to carry out its obligations hereunder and
thereunder. The execution and delivery of this
Agreement by the Company and the consummation by the Company
of the transactions contemplated hereby have been duly
authorized by all necessary action on the part of the Company
and no further action is required by the Company, its board of
directors or its stockholders in connection
therewith. This Agreement has been duly executed by
the Company and, when delivered in accordance with the terms
hereof, will constitute the valid and binding obligation of
the Company enforceable against the Company in accordance with
its terms, except (i) as limited by general equitable
principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights
generally, (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or
other equitable remedies and (iii) insofar as indemnification
and contribution provisions may be limited by applicable
law.
(b)
No
Conflicts . The execution, delivery and
performance of this Agreement by the Company and the
consummation by the Company of the transactions contemplated
hereby do not and will not: (i) conflict with or violate any
provision of the Company’s certificate or articles of
incorporation, bylaws or other organizational or charter
documents; or (ii) conflict with, or constitute a default (or
an event that with notice or lapse of time or both would
become a default) under, result in the creation of any Lien
(except as contemplated herein) upon any of the properties or
assets of the Company in connection with, or give to others
any rights of termination, amendment, acceleration or
cancellation (with or without notice, lapse of time or both)
of, any material agreement, credit facility, debt or other
material instrument (evidencing Company debt or otherwise) or
other material understanding to which such Company is a party
or by which any property or asset of the Company is bound or
affected; or (iii) conflict with or result in a violation of
any law, rule, regulation, order, judgment, injunction, decree
or other restriction of any court or governmental authority to
which the Company is subject (including federal and state
securities laws and regulations), or by which any property or
asset of the Company is bound or affected, except, in the case
of each of clauses (ii) and (iii), such as could not have or
reasonably be expected to result in a Material Adverse Effect
(as defined in the Exchange Agreement).
(c)
Issuance of the
Debenture and Warrant . The Debenture and
Warrant are duly authorized and, upon the execution of this
Agreement by a Purchaser, will be duly and validly issued,
fully paid and nonassessable, free and clear of all Liens
imposed by the Company other than restrictions on transfer
provided for in the Transaction Documents. The
Underlying Shares, when issued in accordance with the terms of
the Debenture and Warrant, will be validly issued, fully paid
and nonassessable, free and clear of all Liens imposed by the
Company. The Company has reserved from its duly
authorized capital stock a number of shares of Common Stock
for issuance of the Underlying Shares.
(d)
Affirmation of
Prior Representations and Warranties
. Except as set forth on Schedule
3(d) hereto, the Company hereby represents and warrants
to each Purchaser that the Company’s representations and
warranties listed in Section 3.1 of the Exchange Agreement are
true and correct as of the date hereof.
4.
Representations
and Warranties of the Purchaser . The
Purchaser hereby represents and warrants as of the date hereof
to the Company as follows:
(a)
Authority
. The execution, delivery and performance by such
Purchaser of the transactions contemplated by this Agreement
have been duly authorized by all necessary corporate or
similar action on the part of such Purchaser. This
Agreement has been duly executed by such Purchaser and, when
delivered by such Purchaser in accordance with the terms
hereof, will constitute the valid and legally binding
obligation of such Purchaser, enforceable against it in
accordance with its terms, except (i) as limited by general
equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights
generally, (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or
other equitable remedies and (iii) insofar as indemnification
and contribution provisions may be limited by applicable
law.
(b)
Own
Account . Such Purchaser (i) understands
that the Debenture and Warrant are “restricted
securities” and have not been registered under the
Securities Act or any applicable state securities law, (ii) is
acquiring the Debenture and Warrant as principal for its own
account and not with a view to or for distributing or
reselling such Debentures or Warrant or any part thereof in
violation of the Securities Act or any applicable state
securities law, (iii) has no present intention of distributing
any of such securities in violation of the Securities Act or
any applicable state securities law and (iv) has no
arrangement or understanding with any other persons regarding
the distribution of such Debenture and Warrant (this
representation and warranty not limiting such
Purchaser’s right to sell the Underlying Shares pursuant
to a registration statement or otherwise in compliance with
applicable federal and state securities laws) in violation of
the Securities Act or any applicable state securities
law. Such Purchaser is acquiring the Debentures and
Warrant hereunder in the ordinary course of its
business.
(c)
Purchaser
Status . At the time Purch
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