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Inter Company Line of Credit Agreement

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Title:

Inter Company Line of Credit Agreement

Entities:

Ener1, Inc.; Ener1 Technologies Inc.

Date:

2003

Size:

Preview shows 3KB of 12KB total

Price:

$33

ID:

#113818

► Loans ► Line of Credit ► Misc. Line of Credit Agreements
► Technology ► Electronic Instruments & Controls

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                     INTER COMPANY LINE OF CREDIT AGREEMENT





         THIS INTER  COMPANY LINE OF CREDIT  AGREEMENT  dated  November 1, 2002,

("Effective Date") between ENER1, INC., (the "Lender"),  and ENER1 TECHNOLOGIES,

INC., (the "Borrower").



                                    ARTICLE I

                                    THE LOANS



         SECTION 1.1.               The Loans.



         (a)  Subject to the terms and  conditions  set forth  below,  and until

further  notice  from the  Lender  to the  Borrower,  the  Lender  hereby  makes

available to the  Borrower a line of credit for loans in an aggregate  amount of

up to $300,000 for twelve (12) months from the Effective Date ("Initial  Term").

In the event Borrower is unable to reach a positive cash flow within the Initial

Term, nor receive third party  financing  during the Initial Term,  Borrower may

borrow up to an  additional  $200,000  during the twelve (12) month period after

the Initial Term  ("Second  Term  Loan").  The Initial Term Loan and Second Term

Loan are collectively referred to as the "Loans".



         (b)  The  Borrower  may  borrow  the  Loans  in  one or  more  drawings

("Drawings").  Each  Drawing  shall be in an amount not less than  $100.00.  The

Borrower  shall  request  each  Drawing by notice to the  Lender at least  three

business  days  prior to the  Drawing.  If the  Lender  shall  elect to make the

requested  Loan, it shall do so on the date requested  (which must be a Business

Day Day) by  crediting  the amount of the Loan to the  Borrower's  current  bank

account.  Each notice of Drawing given by the Borrower to the Lender shall be in

the form  attached  as  Exhibit A and shall  constitute  a  confirmation  by the

Borrower that on the date of the Drawing its  representations and warranties set

forth in Article III below remain true and  correct.  Notice of Drawing from the

Borrower, once received by the Lender, shall be irrevocable.



         (c) Each Loan shall bear  interest  from the date of its Drawing  until

paid in full, at an interest rate per annum equal to six percent. From and after

the occurrence of an Event of Acceleration  described in Section 4.01 below, the

Loans  (and  any  past-due  amounts  of  principal,  interest  or  other  monies

hereunder) shall bear interest at a rate (the "Default Rate") equal to 1.5% over

the rate otherwise  applicable  hereunder until such Event of Acceleration shall

be cured.



                                   ARTICLE II

                                TERMS OF PAYMENT



         SECTION 2.1.               Prepayments.



         Borrower may prepay the Loans without penalty.



         SECTION 2.2.               Payments and Computations.



         (a) The Borrower  shall repay the Loans in equal  monthly  installments

over a five (5) year period commencing on the termination of the Initial Term.



         (b)  Principal,  interest  and other  amounts  payable by the  Borrower

hereunder  shall  be paid in  lawful  money  of the  United  States  (in  freely

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