EXHIBIT 10.1

 

MASTER TERM LOAN AGREEMENT

 

This MASTER TERM LOAN AGREEMENT is entered into as of October 31, 2007, between
CapSource Financial, Inc. a Colorado corporation (“Borrower”), and Randolph M.
Pentel, an individual residing in Minnesota (“Lender”).

 

WHEREAS, Lender has agreed to make available to Borrower a term loan upon and
subject to the terms and conditions set forth in this Agreement;

 

WHEREAS, Borrower and Lender have conducted substantial negotiations of the
Agreement in the State of Minnesota; and

 

WHEREAS, Borrower has delivered this Agreement and the Note (defined below) in
the State of Minnesota.

 

NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the parties agree as follows:

 

ARTICLE 1 - DEFINITIONS

 

The definitions appearing in this Agreement or any supplement or addendum to
this Agreement, shall be applicable to both the singular and plural forms of the
defined terms:

 

“AGREEMENT” means this Master Term Loan Agreement as it may be amended or
supplemented from time to time.

 

“BANKRUPTCY CODE” means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C.
ss.101, et Seq.), as amended.

 

“BASIC INTEREST” means the accrued interest due and payable on the outstanding
Loan Amount as calculated at the Designated Rate.

 

“BORROWING DATE” means the Business Day on which the proceeds of a Loan are
disbursed by Lender.

 

“BUSINESS DAY” means any day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close.

 

 

 

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“COMMITMENT AMOUNT” means the obligation of Lender to make a Loan to Borrower in
an aggregate, original principal amount equal to the LOAN AMOUNT .

 

“DEFAULT” means an event which with the giving of notice, passage of time, or
both would constitute an Event of Default.

 

“DEFAULT RATE” is defined in SECTION 2.5.

 

“DESIGNATED RATE” means a fixed rate of interest per annum between nine and
one-half percent (91/2 %) and twelve percent (12%).

 

“EVENT OF DEFAULT” is defined in ARTICLE 7.

 

“INSOLVENCY PROCEEDING” means (a) any case, action or proceeding before any
court or other governmental authority relating to bankruptcy, reorganization,
insolvency, liquidation, receivership, dissolution, winding-up or relief of
debtors, or (b) any general assignment for the benefit of creditors,
composition, marshalling of assets for creditors, or other, similar arrangement
in respect of its creditors generally or any substantial portion of its
creditors, undertaken under U.S. Federal, state or foreign law, including the
Bankruptcy Code.

 

“LOAN(s)” means the extension of credit by Lender under SECTION 2 of this
Agreement.

 

“LOAN AMOUNT” means the original principal amount of any Loan extended by the
Lender up to Seven Hundred Fifty Thousand Dollars ($750,000).

 

“LOAN DOCUMENTS” means, individually and collectively, this Agreement, the Note
and all other contracts, instruments, addenda and documents executed in
connection with this Agreement or the extensions of credit which are the subject
of this Agreement.

 

“MATERIAL ADVERSE EFFECT” or “MATERIAL ADVERSE CHANGE” means (a) a material
adverse change in, or a material adverse effect upon, the operations, revenues,
assets, business, properties, or condition (financial or otherwise) of Borrower;
(b) a material impairment of the ability of Borrower to perform under any Loan
Document or under any material agreement of the Borrower; or (c) a material
adverse effect upon the legality, validity, binding effect or enforceability
against Borrower of any Loan Document.

 

“MATURITY DATE” means, one (1) year from the Borrowing Date of any Loan and is
the date on which payment of all outstanding principal and accrued interest with
respect to such Loan is due.

 

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“NOTE” means a promissory note substantially in the form of EXHIBIT “A” hereto,
executed by Borrower evidencing an individual Loan under this Agreement.

 

“OBLIGATIONS” means all debts, liabilities, obligations, covenants and duties
arising under any Loan Document, owing by Borrower to Lender, whether direct or
indirect (including those acquired by assignment), absolute or contingent,
liquidated or unliquidated, due or to become due, now existing or hereafter
arising.

 

“TERMINAL PAYMENT” means, with respect to a Loan, an amount payable on the
Maturity Date of the Loan equal to the Loan Amount and any accrued but unpaid
Basic Interest under the Loan.

 

ARTICLE 2 - THE COMMITMENT AND LOANS

 

2.1 THE COMMITMENT. Subject to the terms and conditions of this Agreement,
Lender agrees to make one or more term Loans together totaling an amount equal
to the Loan Amount to Borrower. The Commitment is not a revolving credit
commitment, and Borrower shall not have the right to repay and re-borrow
hereunder. Upon Borrower’s receipt of a Loan under this agreement, the Borrower
will issue to Lender a Note in the form attached as EXHIBIT A in the original
principal amount equal to the amount of each Loan.

 

2.2 PAYMENT OF THE NOTE(s): Each Note shall be payable as follows: (a) Basic
Interest shall be accrued from the Borrowing Date and paid on the Maturity Date;
and (b) the Terminal Payment shall be paid on the Maturity Date.

 

2.3 INTEREST. Basic Interest on the outstanding Loan Amount shall accrue daily
at the Designated Rate from the Borrowing Date through the Maturity Date.

 

2.4 INTEREST RATE CALCULATION. Basic Interest, along with charges and fees under
this Agreement and any Loan Document, shall be calculated for actual days
elapsed on the basis of a 365-day year. In no event shall Borrower be obligated
to pay Lender interest, charges or fees at a rate in excess of the highest rate
permitted by applicable law from time to time in effect.

 

2.5 DEFAULT INTEREST. Any unpaid payments of Basic Interest or the Terminal
Payment shall bear interest from their respective maturities, whether scheduled
or accelerated, at the Designated Rate for such Loan PLUS five percent (5.00%)
per annum (the “Default Rate”), until paid in full, whether before or after
judgment (the “Default Interest”). Borrower shall pay the Default Interest on
the demand of Lender.

 

2.6 LENDER’S RECORDS. Basic Interest, Default Interest, Terminal Payment and all
other sums owed under any Loan Document shall be evidenced by entries in records
customarily maintained by Lender for such purpose. Each payment on and any

 

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other credits with respect to Basic Interest, Default Interest or Terminal
Payment and all other sums outstanding under any Loan Document shall be
evidenced by entries in such records. Absent manifest error, Lender’s records
shall be conclusive evidence thereof; provided, however, that the failure of
Lender to maintain such records or any error therein shall not in any manner
affect the obligations of Borrower to repay the Loan or any interest or fees
called for herein.

 

2.7 PROMISE TO PAY; MANNER OF PAYMENT. Borrower absolutely and unconditionally
promises to pay to Lender principal, interest and all other amounts payable
hereunder, or under any other Loan Document, without any right of rescission and
without any deduction whatsoever, including any deduction for any setoff,
counterclaim or recoupment, or any other event. All payments made by Borrower
shall be made on the date when due in U.S. Dollars.

 

ARTICLE 3 - REPRESENTATIONS AND WARRANTIES

 

Borrower represents and warrants that, as of the Borrowing Date, except as set
forth on a Schedule of Exceptions (“Schedule of Exceptions”) to be amended from
time to time:

 

3.1 DUE ORGANIZATION. Borrower is a corporation duly organized and validly
existing in good standing under the laws of Colorado, and is duly qualified to
conduct business and is in good standing in each other jurisdiction in which its
business is conducted or its properties are located, except where the failure to
be so qualified would not have a Material Adverse Effect.

 

3.2 AUTHORIZATION, VALIDITY AND ENFORCEABILITY. The execution, delivery and
performance of all Loan Documents executed by Borrower are within Borrower’s
powers, have been duly authorized, and are not in conflict with Borrower’s
articles of incorporation or by-laws, or the terms of any charter or other
organizational document of Borrower, as amended from time to time; and all such
Loan Documents constitute valid and binding obligations of Borrower, enforceable
in accordance with their terms (except as may be limited by bankruptcy,
insolvency and similar laws affecting the enforcement of creditors’ rights in
general, and subject to general principles of equity).

 

3.3 COMPLIANCE WITH APPLICABLE LAWS. Borrower has complied with all licensing,
permit and fictitious name requirements necessary to lawfully conduct the
business in which it is engaged, and to any sales, leases or the furnishing of
services by Borrower, including without limitation those requiring consumer or
other disclosures, the noncompliance with which would have a Material Adverse
Effect.

 

3.4 NO CONFLICT. The execution, delivery, and performance by Borrower of all
Loan Documents are not in conflict with any law, rule, regulation, order or
directive, or any indenture, agreement, or undertaking to which Borrower is a
party or by which Borrower may be bound or affected.

 

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3.5 NO LITIGATION, CLAIMS OR PROCEEDINGS. There is no litigation, tax claim or
proceeding pending, or, to the knowledge of Borrower following due
investigation, threatened against Borrower or its property.

 

3.6 CORRECTNESS OF FINANCIAL STATEMENTS. Borrower’s financial statements which
have been delivered to Lender fairly, fully and accurately reflect Borrower’s
financial condition as of December 31, 2006; and, since that date there has been
no Material Adverse Change.

 

3.7 NO EVENT OF DEFAULT. No Default or Event of Default has occurred and is
continuing.

 

3.8 FULL DISCLOSURE. None of the representations or warranties made by Borrower
in the Loan Documents as of the date such representations and warranties are
made or deemed made, and none of the statements contained in any exhibit,
report, statement or certificate furnished by or on behalf of Borrower in
connection with the Loan Documents (including disclosure materials delivered by
or on behalf of Borrower to Lender prior to a Borrowing Date), when taken
together, contains any untrue statement of a material fact or omits any material
fact required to be stated therein or necessary to make the statements made
therein, in light of the circumstances under which they are made, not misleading
as of the time when made or delivered.

 

3.9 INSURANCE. Borrower has in full force and effect such insurance policies as
are customary in its industry.

 

3.10 INVESTMENT COMPANY ACT. Borrower is not an “investment company” registered
or required to be registered under the Investment Company Act of 1940, as
amended, or is controlled by such an “investment company.”

 

3.11 SOLVENCY. Borrower is solvent and will continue to be solvent after the
creation of the obligations of Borrower to Lender hereunder and the consummation
of the other transactions contemplated hereby.

 

ARTICLE 4 - AFFIRMATIVE COVENANTS

 

During the term of this Agreement and until its performance of all obligations
to Lender, Borrower will:

 

4.1 NOTICE TO LENDER. Promptly give written notice to Lender of:

 

(A) Any litigation or administrative or regulatory proceeding affecting Borrower
where the amount claimed against Borrower is Twenty-Five Thousand Dollars
($25,000) or more, or where the granting of the relief requested could
reasonably have a Material Adverse Effect;

 

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(B) The occurrence of any Default or any Event of Default, where the Borrower
has knowledge, or reasonable should have knowledge, of such Default or Event of
Default.

 

(C) Any change in the location of Borrower’s principal place of business at
least thirty (30) days in advance of such change.

 

(D) Any default, or an event which the giving of notice, passage of time, or
both would constitute a default, by Borrower under any agreement, including but
not limited to any joint venture, partnering, distribution, cross-licensing,
strategic alliance, collaborative research or manufacturing, license or similar
agreement which could reasonably be expected to have a Material Averse Effect;
and 

 

(E) Any other matter which has resulted or might reasonably result in a Material
Adverse Change, of which the Borrower is aware or of which the Borrower
reasonably should be aware.

 

4.2 OTHER INFORMATION. Provide to Lender such other statements, lists of
property and accounts, budgets, forecasts, reports, or other information as
Lender may from time to time request.

 

4.3 EXISTENCE. Maintain and preserve Borrower’s existence and all rights, powers
and privileges necessary or desirable in the normal course of its business.

 

4.4 COMPLIANCE WITH LAWS. Comply with all laws, rules, regulations applicable
to, and all orders and directives of any governmental or regulatory authority
having jurisdiction over, Borrower or Borrower’s business, and with all material
agreements to which Borrower is a party, except where the failure to so comply
would not have a Material Adverse Effect.

 

4.5 TAXES AND OTHER LIABILITIES. Pay all Borrower’s obligations when due; pay
all taxes and other governmental or regulatory fees or assessments before
delinquency or before any penalty attaches thereto, except as may be timely
contested in good faith by the appropriate procedures and for which Borrower
shall maintain appropriate reserves; and timely file all required tax returns.

 

ARTICLE 5 - NEGATIVE COVENANTS

 

During the term of this Agreement and until the performance of all obligations
to Lender, Borrower will not (without Lender’s prior written consent):

 

5.1 DIVIDENDS. Except after a Qualified Public Offering, pay any dividends or
purchase, redeem or otherwise acquire or make any other distribution with
respect to any of Borrower’s capital stock, except dividends or other
distributions solely of capital stock of Borrower or repurchases of unvested
shares, at the original purchase price, held by employees.

 

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5.2 DEBT. Prepay any debt obligation of Borrower or any affiliate of Borrower.

 

5.3 CHANGES/MERGERS. Liquidate or dissolve, or enter into any consolidation,
merger, partnership, joint venture or other combination that would constitute a
Material Adverse Change.

 

5.4 SALES OF ASSETS. Sell, transfer, lease or otherwise dispose of any of
borrower’s assets except for fair consideration or where such sale, transfer,
lease or other disposition of assets, individually or in the aggregate, would
not constitute a Material Adverse Change.

 

5.5 LOANS/INVESTMENTS. Make or suffer to exist any loans, guaranties, advances,
or investments, except:

 

(A) Accounts receivable in the ordinary course of Borrower’s business;

 

(B) Investments in domestic certificates of deposit issued by, and other
domestic investments with, financial institutions organized under the laws of
the United States or a state thereof.

 

(C) Investments in marketable obligations of the United States of America and in
open market commercial paper given the highest credit rating by a national
credit agency and maturing not more than one year from the creation thereof.

 

ARTICLE 6 - EVENTS OF DEFAULT

 

6.1 EVENTS OF DEFAULT. Upon the occurrence and during the continuation of any of
the events described below in this SECTION 6.1 (each an “Event of Default”), the
Lender may at its option (1) make all sums of Basic Interest and principal, all
Terminal Payments, and any other amounts owing under any Loan Documents
immediately due and payable without notice of default, presentment or demand for
payment, protest or notice of nonpayment or dishonor or any other notices or
demands, and (2) give Lender the right to exercise any other right or remedy
provided by contract or applicable law:

 

(A) Borrower shall fail to make any payment of Basic Interest or Terminal
Payment when due under this Agreement and the Note, or fail to pay any fees or
other charges when due under any Loan Document, and such failure continues for
five (5) Business Days or more after the same first becomes due; or an Event of
Default as defined in any other Loan Document shall have occurred;

 

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(B) Any representation or warranty made, or financial statement, certificate or
other document provided, by Borrower under any Loan Document shall prove to have
been false or misleading in any material respect when made or deemed made
herein;

 

(C) Borrower shall fail to pay its debts generally as they become due or shall
commence any Insolvency Proceeding with respect to itself; an involuntary
Insolvency Proceeding shall be filed against Borrower, or a custodian, receiver,
trustee, assignee for the benefit of creditors, or other similar official, shall
be appointed to take possession, custody or control of the properties of
Borrower, and such involuntary Insolvency Proceeding, petition or appointment is
acquiesced to by Borrower or is not dismissed within sixty (60) days; or the
dissolution or termination of the business of Borrower;

 

(D) Borrower shall be in default beyond any applicable period of grace or cure
under any other agreement involving the borrowing of money, the purchase of
property, the advance of credit or any other monetary liability of any kind to
Lender or to any Person which results in the acceleration of payment of such
obligation in an amount in excess of Twenty-Five Thousand Dollars ($25,000);

 

(E) Any governmental or regulatory authority shall take any judicial or
administrative action, that would have a Material Adverse Effect, and which
cannot be cured by Borrower within thirty (30) days of such action;

 

(F) Any sale, transfer or other disposition of all or a substantial or material
part of the assets of Borrower, including without limitation to any trust or
similar entity, shall occur where such sale, transfer, lease or other
disposition of assets would constitute a Material Adverse Change;

 

(G) Any judgment(s) singly or in the aggregate in excess of Fifty Thousand
Dollars ($50,000) shall be entered against Borrower which remain unsatisfied,
unvacated or unstayed pending appeal for thirty (30) or more days after entry
thereof; or

 

(H) Borrower shall fail to perform or observe any covenant contained in this
Agreement or any other Loan Document (except for the covenant contained in
Section 6.1(A)) and the breach of such covenant is not cured within thirty (30)
days after the sooner to occur of Borrower’s receipt of notice of such breach
from Lender or the date on which such breach first becomes known to any officer
of Borrower; PROVIDED, HOWEVER, that if such breach is not capable of being
cured within such 30 day period and Borrower timely notifies Lender of such fact
and Borrower diligently pursues such cure, then the cure period shall be
extended to the date requested in Borrower’s notice, but in no event more than
forty-five (45) days from the initial breach. 

 

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ARTICLE 7 - GENERAL PROVISIONS

 

7.1 NOTICES. Any notice given by any party under any Loan Document shall be in
writing and personally delivered, sent by overnight courier, or United States
mail, postage prepaid, or sent by facsimile, to be promptly confirmed in
writing, or other authenticated message, charges prepaid, to the other party’s
or parties’ addresses shown on the signature pages hereto. Each party may change
the address or facsimile number to which notices, requests and other
communications are to be sent by giving written notice of such change to each
other party. Notice given by hand delivery shall be deemed received on the date
delivered; if sent by overnight courier, on the next business day after delivery
to the courier service; if by first class mail, on the third business day after
deposit in the U.S. Mail; and if by telecopy, on the date of transmission.

 

7.2 BINDING EFFECT. The Loan Documents shall be binding upon and inure to the
benefit of Borrower and Lender and their respective successors and assigns;
provided, however, that Borrower may not assign or transfer Borrower’s rights or
obligations under any Loan Document without Lender’s prior written consent.
Lender reserves the right to sell, assign, transfer, negotiate or grant
participations in all or any part of, or any interest in, Lender’s rights and
obligations under the Loan Documents. In connection with any of the foregoing,
Lender may disclose all documents and information which Lender now or hereafter
may have relating to the Loans, Borrower, or its business; provided that any
person who receives such information shall have agreed in writing in advance to
maintain the confidentiality of such information on terms reasonably acceptable
to Borrower.

 

7.3 NO WAIVER. Any waiver, consent or approval by Lender of any Event of Default
or breach of any provision, condition, or covenant of any Loan Document must be
in writing and shall be effective only to the extent expressly set forth in
writing. No waiver of any breach or default shall be deemed a waiver of any
later breach or default of the same or any other provision of any Loan Document.
No failure or delay on the part of Lender in exercising any power, right, or
privilege under any Loan Document shall operate as a waiver thereof, and no
single or partial exercise of any such power, right, or privilege shall preclude
any further exercise thereof or the exercise of any other power, right or
privilege. Lender has the right at its sole option to continue to accept
payments of Basic Interest, Default Interest and/or all or part of the Terminal
Payment due under the Loan Documents after Default, and such acceptance shall
not constitute a waiver of said Default or an extension of the Maturity Date
unless Lender expressly agrees in writing to such waiver or extension.

 

7.4 RIGHTS CUMULATIVE. All rights and remedies existing under the Loan Documents
are cumulative to, and not exclusive of, any other rights or remedies available
under contract or applicable law.

 

7.5 UNENFORCEABLE PROVISIONS. Any provision of any Loan Document executed by
Borrower which is prohibited or unenforceable in any jurisdiction shall be so
only as to such jurisdiction and only to the extent of such prohibition or
unenforceability, but all the remaining provisions of any such Loan Document
shall remain valid and enforceable. 

 

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7.6 ACCOUNTING TERMS. Except as otherwise provided in this Agreement, accounting
terms and financial covenants and information shall be determined and prepared
in accordance with GAAP.

 

7.7 INDEMNIFICATION; EXCULPATION. Borrower shall pay and protect, defend and
indemnify Lender and Lender’s employees, officers, directors, shareholders,
affiliates, correspondents, agents and representatives (other than Lender,
collectively “Agents”) against, and hold Lender and each such Agent harmless
from, all claims, actions, proceedings, liabilities, damages, losses, expenses
(including, without limitation, attorneys’ fees and costs) and other amounts
incurred by Lender and each such Agent, arising from (i) the matters
contemplated by this Agreement or any other Loan Documents, (ii) financing
statement of record outstanding at the time of this Agreement, or (iii) any
contention that Borrower has failed to comply with any law, rule, regulation,
order or directive applicable to Borrower’s business; PROVIDED, HOWEVER, that
this indemnification shall not apply to any of the foregoing incurred solely as
the result of Lender’s or any Agent’s gross negligence or willful misconduct.
This indemnification shall survive the payment and satisfaction of all of
Borrower’s Obligations to Lender.

 

7.8 REIMBURSEMENT. Borrower shall reimburse Lender for all costs and expenses,
including without limitation reasonable attorneys’ fees and disbursements
expended or incurred by Lender in any arbitration, mediation, judicial
reference, legal action or otherwise in connection with (a) the preparation and
negotiation of the Loan Documents, (b) the amendment, interpretation and
enforcement of the Loan Documents, including, without limitation, during any
workout, attempted workout, and/or in connection with the rendering of legal
advice as to Lender’s rights, remedies and obligations under the Loan Documents,
(c) collecting any sum which becomes due Lender under any Loan Document, (d) any
proceeding for declaratory relief, any counterclaim to any proceeding, or any
appeal, or (e) the protection, preservation or enforcement of any rights of
Lender. For the purposes of this section, attorneys’ fees shall include, without
limitation, fees incurred in connection with the following: (1) contempt
proceedings; (2) discovery; (3) any motion, proceeding or other activity of any
kind in connection with an Insolvency Proceeding; (4) garnishment, levy, and
debtor and third party examinations; and (5) post judgment motions and
proceedings of any kind, including without limitation any activity taken to
collect or enforce any judgment or appeals. All of the foregoing costs and
expenses shall be payable upon demand by Lender, and if not paid within thirty
(30) days of presentation of invoices shall bear interest at the highest
applicable Default Rate.

 

7.9 EXECUTION IN COUNTERPARTS. This Agreement may be executed in any number of
counterparts which, when taken together, shall constitute but one agreement.

 

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7.10 ENTIRE AGREEMENT. The Loan Documents are intended by the parties as the
final expression of their agreement and therefore contain the entire agreement
between the parties and supersede all prior understandings or agreements
concerning the subject matter hereof. This Agreement may be amended only in a
writing signed by Borrower and Lender.

 

7.11 TIME OF THE ESSENCE. Time is of the essence in the performance by Borrower
of any of its obligations under the Loan Documents.

 

7.12 USA PATRIOT ACT. Lender hereby notifies Borrower that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Patriot Act”), it is required to obtain, verify and
record information that identifies Borrower, which information includes the name
and address of Borrower and other information that will allow Lender to identify
Borrower in accordance with the Patriot Act.

 

7.13 GOVERNING LAW AND JURISDICTION.

 

(A) THIS AGREEMENT AND THE LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT REFERENCE
TO ITS CHOICE OF LAWS PROVISIONS.

 

(B) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF HENNEPIN COUNTY OF THE STATE OF
MINNESOTA OR OF THE UNITED STATES FOR THE DISTRICT OF MINNESOTA, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF BORROWER AND LENDER CONSENTS,
FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF
THOSE COURTS. EACH OF BORROWER AND LENDER IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM
NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO. BORROWER AND LENDER EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS,
COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY
MINNESOTA LAW.

 

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7.14 WAIVER OF JURY TRIAL. BORROWER AND LENDER EACH WAIVES ITS RESPECTIVE RIGHTS
TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF
OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF
ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. BORROWER AND LENDER EACH AGREES THAT ANY SUCH CLAIM OR CAUSE OF
ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE
FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY
JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION , COUNTERCLAIM OR
OTHER PROCEEDING WHICH SEEMS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR
ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION
HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS.

 

 

IN WITNESS WHEREOF, Borrower and Lender have executed this Agreement as of the
date set forth in the preamble.

 

 

BORROWER:

 

CapSource Financial, Inc.

 

LENDER:

By 

/s/ Steven E. Reichert

 

By 

/s/ Randolph M. Pentel

 

Name: Steven E. Reichert
Its: Vice President

 

 

Name: Randolph M. Pentel

 

 

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