Error on setting password to login to Merchant UI

1) Create a merchant with a valid email id
2) Go to the Reports tab and click 'Send Invite' to login to Merchant UI
3) An activation email will be sent to the mail box
4) Click on the link to activate the account
5) It takes you to a page to set password
6) Fill on the password details and click confirm

The following error is noticed in tomcat log

Address: http://127.0.0.1:8080/sapi/rest/notifications/email
Encoding: UTF-8
Http-Method: POST
Content-Type: application/json; charset=utf-8
Headers:

{Accept=[application/json, text/plain], connection=[Keep-Alive], content-encoding=[UTF-8], Content-Length=[218], content-type=[application/json; charset=utf-8], host=[127.0.0.1:8080], user-agent=[Apache-HttpClient/4.2.1 (java 1.5)], x-tsa-authenticate=[LK3CYKUPKK2RWGLKNTE5ZNWSHPBW2YQQ6PWEFLZQ4OVGDYL2CWOQ6YWCY3VKOBFYVBWGRAEJC6EQJAXPIXOIK3YV7OE2G34CJB37E7ICRPLJAFNBLHEQHBPPRYLA4OO5K2OAVR4NV5P2M4MR76Q7JJADUYXBW2LKIAUJXALE7TEZPT5Y3VCYKRVJHFG3T7MCGDKSDOBA4HMP4===]}

Payload:

{"recipientId":"ac29d2c0-8e6f-4000-ae7d-8591a592f56a","merchantId":"5a69576d-0f48-41c7-89a3-9699057aebc4","messageType":"account-activated","url":"http://qa3amltest.aml-qa3-front1:9626/merchant/","userType":"merchant"}

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2014-07-15 14:01:17,908-14960984 [http-8080-8] WARN com.thesearchagency.sapi.services.notification.NotificationService [timezone=Etc/UTC, principalId=d42f5a21-fd27-4381-8726-1aa5194e6443, requestId=c9a8bc42-2404-4684-9f4d-c23e75add5d9, locale=en_US, authToken=LK3CYKUPKK2RWGLKNTE5ZNWSHPBW2YQQ6PWEFLZQ4OVGDYL2CWOQ6YWCY3VKOBFYVBWGRAEJC6EQJAXPIXOIK3YV7OE2G34CJB37E7ICRPLJAFNBLHEQHBPPRYLA4OO5K2OAVR4NV5P2M4MR76Q7JJADUYXBW2LKIAUJXALE7TEZPT5Y3VCYKRVJHFG3T7MCGDKSDOBA4HMP4===, hostname=127.0.0.1, ipAddress=127.0.0.1] - Unable to find merchant with id: 5a69576d-0f48-41c7-89a3-9699057aebc4
2014-07-15 14:01:17,910-14960986 [http-8080-8] ERROR com.thesearchagency.sapi.services.notification.NotificationService [timezone=Etc/UTC, principalId=d42f5a21-fd27-4381-8726-1aa5194e6443, requestId=c9a8bc42-2404-4684-9f4d-c23e75add5d9, locale=en_US, authToken=LK3CYKUPKK2RWGLKNTE5ZNWSHPBW2YQQ6PWEFLZQ4OVGDYL2CWOQ6YWCY3VKOBFYVBWGRAEJC6EQJAXPIXOIK3YV7OE2G34CJB37E7ICRPLJAFNBLHEQHBPPRYLA4OO5K2OAVR4NV5P2M4MR76Q7JJADUYXBW2LKIAUJXALE7TEZPT5Y3VCYKRVJHFG3T7MCGDKSDOBA4HMP4===, hostname=127.0.0.1, ipAddress=127.0.0.1] - Exception caught in execution. Data is null
com.thesearchagency.services.commons.ServiceException: Unable to find merchant with id: 5a69576d-0f48-41c7-89a3-9699057aebc4
at com.thesearchagency.sapi.services.notification.NotificationService.getMerchantData(NotificationService.java:290) [NotificationService.class:na]
at com.thesearchagency.sapi.services.notification.NotificationService.doSend(NotificationService.java:183) [NotificationService.class:na]
at com.thesearchagency.sapi.services.notification.NotificationService.access$000(NotificationService.java:90) [NotificationService.class:na]
at com.thesearchagency.sapi.services.notification.NotificationService$1.call(NotificationService.java:171) ~[NotificationService$1.class:na]
at com.thesearchagency.sapi.services.SAPIService.doExecute(SAPIService.java:159) ~[SAPIService.class:na]
at com.thesearchagency.sapi.services.notification.NotificationService.sendNotification(NotificationService.java:166) [NotificationService.class:na]
at sun.reflect.NativeMethodAccessorImpl.invoke0(Native Method) ~[na:1.6.0_24]
at sun.reflect.NativeMethodAccessorImpl.invoke(NativeMethodAccessorImpl.java:57) ~[na:1.6.0_24]
at sun.reflect.DelegatingMethodAccessorImpl.invoke(DelegatingMethodAccessorImpl.java:43) ~[na:1.6.0_24]
at java.lang.reflect.Method.invoke(Method.java:616) ~[na:1.6.0_24]
at org.apache.cxf.service.invoker.AbstractInvoker.performInvocation(AbstractInvoker.java:180) [cxf-api-2.7.5.jar:2.7.5]
at org.apache.cxf.service.invoker.AbstractInvoker.invoke(AbstractInvoker.java:96) [cxf-api-2.7.5.jar:2.7.5]
at org.apache.cxf.jaxrs.JAXRSInvoker.invoke(JAXRSInvoker.java:198) [cxf-rt-frontend-jaxrs-2.7.5.jar:2.7.5]
at org.apache.cxf.jaxrs.JAXRSInvoker.invoke(JAXRSInvoker.java:100) [cxf-rt-frontend-jaxrs-2.7.5.jar:2.7.5]
at org.apache.cxf.interceptor.ServiceInvokerInterceptor$1.run(ServiceInvokerInterceptor.java:58) [cxf-api-2.7.5.jar:2.7.5]
at org.apache.cxf.interceptor.ServiceInvokerInterceptor.handleMessage(ServiceInvokerInterceptor.java:94) [cxf-api-2.7.5.jar:2.7.5]
at org.apache.cxf.phase.PhaseInterceptorChain.doIntercept(PhaseInterceptorChain.java:271) [cxf-api-2.7.5.jar:2.7.5]
at org.apache.cxf.transport.ChainInitiationObserver.onMessage(ChainInitiationObserver.java:121) [cxf-api-2.7.5.jar:2.7.5]
at org.apache.cxf.transport.http.AbstractHTTPDestination.invoke(AbstractHTTPDestination.java:239) [cxf-rt-transports-http-2.7.5.jar:2.7.5]
at org.apache.cxf.transport.servlet.ServletController.invokeDestination(ServletController.java:223) [cxf-rt-transports-http-2.7.5.jar:2.7.5]
at org.apache.cxf.transport.servlet.ServletController.invoke(ServletController.java:203) [cxf-rt-transports-http-2.7.5.jar:2.7.5]
at org.apache.cxf.transport.servlet.ServletController.invoke(ServletController.java:137) [cxf-rt-transports-http-2.7.5.jar:2.7.5]
at org.apache.cxf.transport.servlet.CXFNonSpringServlet.invoke(CXFNonSpringServlet.java:158) [cxf-rt-transports-http-2.7.5.jar:2.7.5]
at org.apache.cxf.transport.servlet.AbstractHTTPServlet.handleRequest(AbstractHTTPServlet.java:243) [cxf-rt-transports-http-2.7.5.jar:2.7.5]
at org.apache.cxf.transport.servlet.AbstractHTTPServlet.doPost(AbstractHTTPServlet.java:163) [cxf-rt-transports-http-2.7.5.jar:2.7.5]
at javax.servlet.http.HttpServlet.service(HttpServlet.java:637) [tomcat6-servlet-2.5-api-6.0.24.jar:na]
at org.apache.cxf.transport.servlet.AbstractHTTPServlet.service(AbstractHTTPServlet.java:219) [cxf-rt-transports-http-2.7.5.jar:2.7.5]
at org.apache.catalina.core.ApplicationFilterChain.internalDoFilter(ApplicationFilterChain.java:290) [catalina-6.0.24.jar:na]
at org.apache.catalina.core.ApplicationFilterChain.doFilter(ApplicationFilterChain.java:206) [catalina-6.0.24.jar:na]
at org.apache.catalina.core.StandardWrapperValve.invoke(StandardWrapperValve.java:233) [catalina-6.0.24.jar:na]
at org.apache.catalina.core.StandardContextValve.invoke(StandardContextValve.java:191) [catalina-6.0.24.jar:na]
at org.apache.catalina.core.StandardHostValve.invoke(StandardHostValve.java:127) [catalina-6.0.24.jar:na]
at org.apache.catalina.valves.ErrorReportValve.invoke(ErrorReportValve.java:102) [catalina-6.0.24.jar:na]
at org.apache.catalina.core.StandardEngineValve.invoke(StandardEngineValve.java:109) [catalina-6.0.24.jar:na]
at org.apache.catalina.connector.CoyoteAdapter.service(CoyoteAdapter.java:298) [catalina-6.0.24.jar:na]
at org.apache.coyote.http11.Http11Processor.process(Http11Processor.java:857) [tomcat-coyote-6.0.24.jar:na]
at org.apache.coyote.http11.Http11Protocol$Http11ConnectionHandler.process(Http11Protocol.java:588) [tomcat-coyote-6.0.24.jar:na]
at org.apache.tomcat.util.net.JIoEndpoint$Worker.run(JIoEndpoint.java:489) [tomcat-coyote-6.0.24.jar:na]
at java.lang.Thread.run(Thread.java:679) [na:1.6.0_24]
2014-07-15 14:01:17,913-14960989 [http-8080-8] INFO org.apache.cxf.interceptor.LoggingOutInterceptor [] - Outbound Message

7) It takes you to the login page.
8) Now login with the email id and password. Able to login successfully.
There is no activation confirmation email sent once I login to Merchant UI