On June 26, 2012, OOO Net Element Russia (which is a subsidiary of Net Element, Inc.) ("Net Element Russia") entered into a Loan Agreement with Green Venture Group, LLC ("GVG"). Pursuant to the Loan Agreement, GVG agreed to loan to Net Element Russia 150 million Russian rubles (or approximately US$4,557,885 based on the currency exchange rate as of the close of business on June 26, 2012). The loan is unsecured and must be funded within five business days from June 26, 2012. The loan is intended to be used by Net Element Russia for working capital and the development of the business of OOO TOT Money, which is a subsidiary of Net Element, Inc. that was recently formed to adapt the existing revenue sharing platform used in Openfilm.com to a mobile commerce payment processing platform. The interest rate under the Loan Agreement is 8.15% per annum and outstanding principal and interest is due on or before November 1, 2012. The loan may be pre-paid at any time without penalty or charge. Under the Loan Agreement, the required repayment date of the loan may be accelerated if an event of default occurs under the terms of the Loan Agreement, including if certain bankruptcy, receiver, insolvency or dissolution events occur with respect to Net Element Russia or if Net Element Russia fails to timely pay principal and/or interest under the Loan Agreement and such failure continues for 60 business days from the date of receipt of written notice of such failure from GVG. GVG is owned and controlled by Mike Zoi, a director and Chief Executive Officer of Net Element, Inc.

The disclosures contained under Item 1.01 are incorporated herein by this reference.

(d) Exhibits.

Exhibit No.      Description
 10.1            Loan Agreement dated June 26, 2012 between Green Venture Group,
                 LLC and OOO Net Element Russia