Exhibit 10.2

TERM NOTE

 

 

$613,808

Minneapolis, Minnesota

 

December 14, 2012

 

FOR VALUE RECEIVED, the undersigned, Cachet Financial Solutions Inc., a
Minnesota corporation (“Borrower”) with an address of Southwest Tech Center A,
18671 Lake Drive East, Minneapolis, MN 55317, promises to pay to the order of
THE MARGARET DE JONGE TRUST (“Lender”), at 3600 W. Fuller Street, Edina MN
55410, or at any other place designated at any time by the holder hereof, the
principal sum of Six Hundred Thousand, Eight Hundred and Eight and no/100
Dollars ($613,808); together with interest on the principal balance outstanding
hereon from the date hereof until paid in full at a fixed rate equal to 12% per
annum.

Borrower will pay this loan in one payment of all outstanding principal plus all
accrued, unpaid interest on December 7, 2014 (the “Maturity Date”), subject to
any prior prepayment. Borrower may prepay the outstanding balance of this Note
in whole or in part without premium or penalty.

All payments of principal, interest, fees and expenses under this Note shall be
made without set-off or counterclaim in immediately available funds in lawful
money of the United States of America not later than 5:00 p.m., Minnesota time,
on the dates called for under this Note at the address of Lender designated
above.  Funds received on any day after such time shall be deemed to have been
received on the next business day.  Whenever any payment would be due on a day
which is not a business day, such payment shall be made on the next succeeding
business day and such extension of time shall be included in the computation of
any interest or fees.  All payments (or prepayments) received by Lender
hereunder shall be applied to the principal sum, interest thereon and the other
obligations of Borrower to Lender arising under or in connection with this Note
in such order and manner as Lender may elect, and in the absence of any such
election: first, to the payment of costs, expenses and fees due from Borrower to
Lender arising under or in connection with this Note or the indebtedness
evidenced hereby; next, to the payment of interest computed at the applicable
rate provided for above; next, toward the reduction of the principal sum; and
finally, to the payment of any other obligations due from Borrower arising under
or in connection with this Note or the indebtedness evidenced hereby.

Borrower will pay Lender, on demand, all out-of-pocket expenses incurred by
Lender in connection with this Note and the indebtedness evidenced hereby,
including without limitation, reasonable attorneys’ fees. 

All agreements between Borrower and Lender are hereby expressly limited so that
in no contingency or event whatsoever, whether by reason of acceleration of
maturity of the indebtedness evidenced hereby or otherwise, shall the amount
paid or agreed to be paid to Lender for the use, forbearance, loaning or
detention of the paid indebtedness evidenced hereby exceed the maximum
permissible under applicable law.  If from any circumstances whatsoever,
fulfillment of any provisions hereof at any time given shall exceed the maximum
permissible under applicable law, then the obligation to be fulfilled shall
automatically be reduced to an amount which complies with applicable law, and if
from any circumstances Lender should ever receive as interest an amount which
would exceed the highest lawful rate of interest, such amount would be in excess
of such lawful rate of interest shall be applied to the reduction of the
principal balance evidenced hereby and not to the payment of interest.  This
provision shall control every other provision of all agreements between Borrower
and Lender and shall also be binding upon and available to any subsequent holder
of this Note.

Time is of the essence of this Note and each of the provisions hereof.

The occurrence of any one or more of the following events shall constitute an
“Event of Default” under this Note:

Borrower shall fail to make when due, whether by acceleration or otherwise, any
payment of principal of or interest on this Note and such failure continues for
five (5) business days following receipt by Borrower of written notice of the
same from Lender;

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Borrower shall fail to comply with any other agreement, covenant, condition,
provision or term contained herein and such failure continues for three (3)
business days following receipt by Borrower of written notice of the same from
Lender; or

Borrower shall (i) become insolvent or unable to pay its debts generally as they
mature, (ii) suspend business, (iii) make a general assignment for the benefit
of creditors, (iv) admit in writing its inability to pay its debts generally as
they mature, (v) file or have filed against it a petition in bankruptcy or a
petition or answer seeking a reorganization, arrangement with creditors or other
similar relief under the Federal bankruptcy laws or under any other applicable
law of the United States of America or any State thereof, which petition if
filed against (and not by) Borrower is not withdrawn, vacated, set aside or
stayed within sixty (60) days from the date of entry, (vi) consent to the
appointment of a trustee or receiver for Borrower or for a substantial part of
its property, or (vii) have an order, judgment or decree entered appointing,
without its consent, a trustee or receiver for Borrower or for a substantial
part of its property, which order, judgment or decree is not vacated, set aside
or stayed within sixty (60) days from the date of entry.

If (a) any Event of Default described in item (c) above shall occur, the
outstanding unpaid principal balance of this Note and the accrued interest
hereon shall automatically become immediately due and payable; or (b) any other
Event of Default shall occur and be continuing, then Lender may take any or all
of the following actions: (i) declare the outstanding unpaid principal balance
of this Note and the accrued and unpaid interest hereon to be forthwith due and
payable, whereupon the same shall immediately become due and payable without
demand or notice of any kind, all of which are hereby expressly waived, and (ii)
enforce all rights and remedies under any applicable law.  Failure to exercise
any right or remedy provided for or referenced herein shall not constitute a
waiver of the right to exercise the same in connection with the applicable Event
of Default or any subsequent Event of Default. 

In addition to any other remedies hereunder, any payment not made by Borrower
within five (5) business days of the due date thereof, including without
limitation any payment due on the Maturity Date, shall be subject to a late
payment charge equal to $500.00 per day until such payment is paid in full, and
shall be immediately due by Borrower to the holder hereof. 

Borrower hereby waives demand, presentment for payment, notice of nonpayment,
protest and notice of protest hereon.  Borrower further agrees (a) that, without
any notice, Lender may from time to time extend the dates or reduce the amounts
of payment under this Note, with or without consideration, and that in any such
case Borrower will continue to be liable to pay the unpaid balance of the
indebtedness evidenced by this Note as so extended or reduced, and (b) to pay
all costs of collection, including reasonable attorneys’ fees, if any payment is
not made when due.  Such attorneys’ fees shall be owed (i) whether or not suit
is brought and (ii) for any kind or an action, including, but not limited to,
any bankruptcy, insolvency or similar proceedings and any probate or other
proceedings involving a decedent, but shall not be owed in the case where
Borrower is the prevailing party in actions or proceedings brought by Borrower
against Lender or actions or proceedings brought by Lender against Borrower.

This Note shall be governed and construed in accordance with the internal laws
of the State of Minnesota.

[Remainder of page left blank;
signature page follows]

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IN WITNESS WHEREOF, Borrower has executed this Note as of the date first written
above.

 

 

 

 

CACHET FINANCIAL SOLUTIONS INC.,

 

a Minnesota corporation

 

By:  

/s/ Jeffrey C. Mack

 

 

Name: Jeffrey C. Mack

 

 

Title: Chief Executive Officer

 

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