UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): ~~July~~August 317, 2012

	Net Element, Inc.
	(Exact name of registrant as specified in its charter)

Delaware		000-51108		20-0715816
(State or other jurisdiction of incorporation)		(Commission (File Number)		(I.R.S. Employer Identification No.)

1450 S. Miami Avenue, Miami, FL		33130
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code:

(305) 507-8808

	Not Applicable
	Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On ~~July~~August 317, 2012, ~~OOO~~ ~~Net~~OOO ~~Element~~TOT ~~Russia~~Money (which is a subsidiary of Net Element, Inc.) ("~~Net~~TOT ~~Element Russia~~Money") entered into a ~~Loan~~Credit Agreement, (together with ~~dated~~related ~~July~~and 4ancillary agreements, ~~2012~~collectively, ~~with~~the ~~OOO Sat-Moscow (~~"~~Sat-Moscow~~Agreement") with Alfa-Bank. Pursuant to the ~~Loan~~ Agreement, ~~Sat~~Alfa-~~Moscow~~ Bank agreed to ~~loan~~provide a line of credit to ~~Net~~ ~~Element~~TOT ~~Russia~~Money ~~150~~with the credit line limit set at 300 million Russian rubles (or approximately US$49,~~636~~348,~~928~~707 based on the currency exchange rate as of the close of business on ~~June~~August 417, 2012). The ~~loan~~interest israte ~~unsecured~~on ~~and must be funded within five business days from July 4, 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~~initial ~~subsidiary~~amount ofborrowed ~~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 83.1555% per annum ~~and outstanding principal and interest is due on or before November 1, 2012~~. ~~The~~Alfa-Bank ~~loan~~has ~~may~~the beunilateral ~~pre-paid~~right atto ~~any~~change ~~time~~the ~~without~~interest ~~penalty~~rate oron ~~charge.~~amounts borrowed ~~Under~~under the ~~Loan~~ Agreement, ~~the~~from ~~required~~time ~~repayment~~to ~~date~~time ofin the ~~loan may be accelerated if an~~ event of ~~default~~changes ~~occurs~~in ~~under~~certain ~~the~~market ~~terms~~rates ofor ~~the~~in ~~Loan Agreement,~~Alfa-Bank's ~~including~~reasonable ifdiscretion, provided ~~certain~~that ~~bankruptcy,~~the ~~receiver,~~interest ~~insolvency~~rate ormay ~~dissolution~~not ~~events~~exceed ~~occur~~14% ~~with~~per ~~respect~~annum. toInterest ~~Net~~must ~~Element~~be ~~Russia or~~repaid ifon ~~Net~~a ~~Element~~monthly ~~Russia~~basis ~~fails~~on tothe ~~timely~~25th ~~pay~~of ~~principal~~each ~~and/or~~month. Amounts ~~interest~~borrowed under the ~~Loan~~ Agreement ~~and~~must ~~such~~be ~~failure~~repaid ~~continues~~within ~~for 60~~six ~~business~~months ~~days~~of ~~from~~ the date ofborrowed. ~~receipt~~The duration of ~~written~~the ~~notice~~line of ~~such~~credit is ~~failure~~set from ~~Sat-Moscow.~~August ~~Sat-Moscow is indirectly controlled by Kenges Rakishev~~17, a2012 ~~director~~through ofMay ~~Net Element~~21, ~~Inc~~2014.

The Agreement requires TOT Money to establish and maintain a deposit account with Alfa-Bank with a minimum balance of 150% of the average value of liabilities on outstanding credit products provided to TOT Money by Alfa-Bank. TOT Money's obligations under the Agreement are secured by a pledge of TOT Money's deposits in such deposit account and by a guarantee given by AO SAT & Company. AO SAT & Company is an affiliate of Kenges Rakishev, a director of Net Element, Inc.

The financial obligations of TOT Money under the Agreement may be increased in the following circumstances, among others: (i) in case of delay in repayment of loans, Alfa-Bank may charge TOT Money a penalty of 0.2% of the defaulted obligation for each day of delay, but not less than double the refinancing rate; (ii) in case of late payment of interest, Alfa-Bank may charge TOT Money a penalty of 0.2% of the defaulted obligation for each day of delay, but not less than double the refinancing rate; and/or (iii) in the event TOT Money fails to maintain the required minimum balance in its deposit account with Alfa-Bank, then Alfa-Bank has the right to require TOT Money to pay a penalty of 0.5% of the amount by which the actual balance in such account is below the required minimum balance.

The financial obligations of TOT Money under the Agreement may be accelerated in the following circumstances, among others: (i) if there is any delay in payment of any accrued interest and/or fees; (ii) if any loans under the Agreement are not repaid on the dates when due; (iii) if TOT Money fails to provide certain required information and/or documents to Alfa-Bank; (iv) if certain bankruptcy or insolvency proceedings are initiated or similar events occur; (v) if TOT Money terminates or modifies its business; (vi) if TOT Money transfers or encumbers its property without Alfa-Bank's written consent; (vii) if certain significant changes occur in TOT Money's management; (viii) if TOT Money violates the terms of the Agreement or the related pledge agreement or other ancillary agreements; (ix) if TOT Money's financial position deteriorates; and/or (x) if AO SAT & Company violates the terms of its guarantee agreement.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement or a Registrant.

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

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.		Description
10.1		~~Loan~~Credit Agreement dated ~~July~~August 417, 2012 between ~~OOO Sat~~Alpha-~~Moscow~~Bank and OOO ~~Net~~TOT ~~Element Russia~~Money
10.2		Agreement of Property Rights Pledge dated August 17, 2012 between Alpha-Bank and OOO TOT Money

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	NET ELEMENT, INC.
Date: July 6, 2012	By:	/s/ Jonathan New
Date: August 23, 2012	By:	/s/ Jonathan New
	Name: Jonathan New
	Name:	Jonathan New
	Title: Chief Financial Officer
	Title:	Chief Financial Officer

EXHIBIT INDEX

Exhibit No.		Description
10.1		~~Loan~~Credit Agreement dated ~~July~~August 417, 2012 between ~~OOO Sat~~Alpha-~~Moscow~~Bank and OOO ~~Net~~TOT ~~Element Russia~~Money
10.2		Agreement of Property Rights Pledge dated August 17, 2012 between Alpha-Bank and OOO TOT Money

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