Document:

Exhibit
      10.68

     

    THIS
      NOTE
      HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“ACT”),
      NOR HAS IT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE.
      NO TRANSFER OF THIS NOTE WILL BE PERMITTED UNLESS A REGISTRATION STATEMENT
      UNDER
      THE ACT IS IN EFFECT AND AS TO SUCH TRANSFER, THE TRANSFER IS MADE IN ACCORDANCE
      WITH RULE 144 UNDER THE ACT OR AS OTHERWISE PERMITTED BY BORROWER, OR IN THE
      OPINION OF COUNSEL SATISFACTORY TO BORROWER REGISTRATION UNDER THE ACT IS
      UNNECESSARY IN ORDER FOR SUCH TRANSFER TO COMPLY WITH THE ACT AND WITH
      APPLICABLE STATE SECURITIES LAWS.

    

    ITREX
      International Corporation 

    CONVERTIBLE
      PROMISSORY NOTE

    

    
      	
              Principal
                Amount: 
$25,000.00

            	
              Los
                Angeles, CA. 
January 18, 2007

            

    

    

    FOR
      VALUE
      RECEIVED, the undersigned, ITREX International Corporation. ("Borrower"), a
      Delaware corporation and wholly-owned subsidiary of ORBIT BRANDS CORPORATION
      (“ORBIT”) a Delaware C corporation and NASDAQ Pink Sheets listed public company,
      promises to pay to the order of Michael and Sylvia Silverstein, Joint Tenants
      in
      Common ("Lender"), in lawful money of the United States or common stock, the
      principal sum of Twenty-Five Thousand and No/100 Dollars ($25,000.00), together
      with interest thereon from the date hereof until this Note is paid in full.
      

     

    
      	
            	1.	
              Repayment
                of the Principal Sum.
                The
                Principal Sum shall be due and payable in one (1) installment of
                Twenty-Five Thousand and No/100 Dollars ($25,000.00) one year from
                the
                date of execution and delivery of this Note to Lender (the “Maturity
                Date”).
                

            

    

    

    
      	
            	2.	
              Interest:
                Interest shall accrue on the Principal Sum commencing on the date
                of
                execution and delivery hereof (the “Interest Accrual Date”). From the
                Interest Accrual Date until the Maturity Date, interest shall accrue
                on
                the unpaid Principal Sum at the rate of 6 % per annum. Unless this
                Note is
                converted pursuant to the terms of Section 3 below, accrued and unpaid
                interest shall be payable, together with the unpaid Principal Sum,
                on the
                Maturity Date. If the Maturity Date should fall on a weekend or national
                holiday, payment shall be due on the following business day. Interest
                on
                this Note shall be computed on the basis of the actual number of
                days
                elapsed during which the unpaid Principal Sum is outstanding, divided
                by a
                year of three hundred sixty-five (365) days. All payments under this
                Note
                shall be applied first to the payment of accrued and unpaid interest,
                with
                the remainder applied to the unpaid Principal
                Sum.

            

    

     

    	(a)  	
            Increased
              Rate After Maturity Date:
              If, by the Maturity Date: (i) this Note has not been converted in
              accordance with its terms; or (ii) the Borrower does not repay the
              Principal Sum and any accrued interest thereon, then the interest rate
              attributable to the Principal Sum shall increase to ten percent (10
              %) per
              annum.

          

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    	(b)  	
            Conversion:
              Lender agrees that all principal and interest represented by this Note
              shall, at the sole option of Borrower’s parent corporation, ORBIT, convert
              into fully paid and non-assessable shares of the common stock of ORBIT
              at
              the price (the “Conversion Price”) of $.0002 per share, at any time before
              the Maturity Date of this Note, or thereafter, without any action on
              the
              part of the Lender. ORBIT shall notify Lender upon its election to
              convert
              this Note into shares of the Company’s common stock at a basis of $.0002
              per share. The Company shall register the converted shares on a best
              efforts basis.

          

     

    
      	
            	3.	
              Registration
                of Converted Shares:
                Any shares of ORBIT issued to Lender in accordance with the conversion
                right set forth above (the “Converted Shares”) shall, following the
                conversion, be registered by ORBIT in Lender’s name. ORBIT agrees that
                Lender shall have “Piggyback” rights to have such shares included in any
                registration statement file by ORBIT, other than a registration statement
                on Form S-4, SB2, 1145 or S-8. All expenses of such registration
                shall be
                borne by ORBIT. 

            

    

     

    
      	
            	4.	
              Representations
                and Warranties of Borrower:
                Borrower represents and warrants
                that:

            

    

    

    	(a)  	
            Borrower
              is a corporation duly organized and existing under the laws of the
              State
              of Delaware. It has the power to own its property and to carry on its
              business as it is now being conducted.

          

    

    	(b)  	
            Borrower
              has full power and authority to borrow the sums provided for in this
              Note,
              and to perform and observe the terms and provisions of this Note;
              

          

    

    	(c)  	
            The
              officers of Borrower executing this Note are duly and properly in office
              and fully authorized to execute it; and

          

    

    	(d)  	
            This
              Note has been duly authorized, executed, and delivered by Borrower,
              and is
              a legal, valid, and binding agreement of Borrower, enforceable against
              it
              in accordance with its terms.

          

    

    
      	
            	5.	
              Events
                of Default:
                The occurrence of any of the following events (“Events of Default”) shall,
                at the option of the Lender, make all interest and principal remaining
                due
                under this Note immediately due and
                payable:

            

    

    

    	(a)  	
            If
              Borrower shall fail to pay, within ninety (90) days after the date
              when
              due, any installment of interest or principal in accordance with the
              terms
              of this Note; or

          

    

    	(b)  	
            If
              any representation or warranty by Borrower in this Note shall prove
              to
              have been false or misleading in any material respect when
              made.

          

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    
      	
            	6.	
              Notices:
                Any communications between the parties or notices provided for in
                this
                Note may be given by mailing them, first class, postage prepaid,
                and
                to:

            

    

    

    If
      to
      Lender: Michael and Sylvia Silverstein, Joint Tenants 

    Social
      Security No.: 

    Address:
      

    Telephone
      No 

    

    and
      if to
      Borrower:

    

    Attention:
      Joseph R. Cellura, Chairman and Chief Executive Officer, c/o

    
      	
              ITREX
                International Corporation 

            	
              ORBIT
                BRANDS CORPORATION

            
	
              P.O.
                Box 944

            	
              13701
                Riverside Drive, Suite 701

            
	
              Malibu,
                CA 90265

            	
              Sherman
                Oaks, CA. 91423

            

    

    

    or
      to
      such other address as either party may indicate to the other in writing after
      the date of this Note.

    

    
      	
            	7.	
              Assignment:
                This Note shall be binding upon, and inure to the benefit of, the parties
                hereto and their respective successors and assigns; provided, however,
                that Borrower shall not assign this Note or any of the rights, duties,
                or
                obligations of Borrower hereunder without the prior written consent
                of
                Lender.

            

    

    

    
      	
            	8.	
              No
                Waiver:
                No delay or omission to exercise any right, power, or remedy accruing
                to
                Lender upon any breach or default of Borrower hereunder shall impair
                any
                such right, power, or remedy of Lender in the future; nor shall any
                waiver
                of any single breach or default be considered a waiver of any other
                prior
                or subsequent breach or default. All remedies, either under this
                Note or
                by law or otherwise afforded to Lender, shall be cumulative and not
                alternative.

            

    

    

    
      	
            	9.	
              Attorney’s
                Fees:
                In the event of any legal action or suit in relation to this Note,
                or in
                the event that Lender incurs any legal expense in protecting its
                rights
                under this Note, Borrower, in addition to all other sums which Borrower
                may be called upon to pay, shall pay to Lender the amount of such
                legal
                expense and shall, if Lender prevails in such action, pay to Lender
                its
                reasonable attorney's fees and all other costs and
                expenses.

            

    

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    
      	
            	10.	
              Governing
                Law:
                This
                Note shall be interpreted under, construed in accordance with, and
                governed by, the laws of the State of California, without giving
                effect to
                the conflicts of law principles
                thereof.

            

    

     

    
      	 	 	 
	 	
              ITREX
                International Corporation

              A
                Delaware Corproation

            
	 
 	 
 	 
 
	
            	By  	
            
	 	
              
Title:
              Chairman and Chief Executive Officer
	 	
            

      	 	 	 
	 	
              ORBIT
                BRANDS CORPORATION 

              A
                Delaware Corporation

            
	 
 	 
 	 
 
	
            	By  	
            
	 	
              
Title:
              Chairman and Chief Executive Officer
	 	
            

    

     

    
      
         

      

      
        4Unassociated Document

    EXHIBIT
      4.26

     

     

    THE
      SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
      ACT
      OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY
      NOT
      BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN
      EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT
      OF
      1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION
      THEREFROM.

     

    THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON WHO MAY BE
      DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144 PROMULGATED
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY
      BE
      SOLD ONLY IN COMPLIANCE WITH RULE 144, PURSUANT TO AN EFFECTIVE REGISTRATION
      STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A VALID EXEMPTION FROM
      REGISTRATION UNDER THE SECURITIES ACT.

     

    PROMISSORY
      NOTE 

     

    
      	$4,500,000	
              February
                13, 2007

            

    

     

    FOR
      VALUE
      RECEIVED, the undersigned, Ener1, Inc., a Florida corporation (the “Borrower”),
      hereby promises to pay to the order of Ener1 Group, Inc., a Florida corporation,
      at such place or to such other party or parties as the holder or any successor
      holder (the “Holder”) of this Promissory Note (this “Note”) may from time to
      time designate, the principal sum of FOUR MILLION FIVE HUNDRED THOUSAND DOLLARS
      ($4,500,000) together with interest thereon from the date hereof upon the terms
      and conditions specified below.

     

    1. Principal
      and Interest.
      Subject
      to Section 8, the principal amount outstanding under this Note shall be payable
      in full, together with all accrued but unpaid interest thereon, on May 15,
      2009,
      or such earlier date but not before January 1, 2008, in the event that the
      senior secured convertible debentures have been paid in full, converted or
      otherwise retired. All payments shall be in lawful money of the United States
      of
      America. Interest shall accrue only until the maturity hereof, at which time
      all
      accrued interest shall be payable in full. Interest shall be computed hereunder
      based on a 365-day year (or a 366-day year in each leap year) and the actual
      number of days (including the first day and excluding the last day) occurring
      in
      the period for which interest is calculated. Interest shall accrue daily at
      an
      annual rate of 10%, and be compounded annually.

     

    2. Application
      of Payments.
      All
      payments made hereunder shall be applied in any manner deemed appropriate by
      the
      Holder.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    3. Prepayment.
      Subject
      to Section 8, the Borrower shall have the right to prepay any or all of the
      outstanding principal balance of this Note and any accrued and unpaid interest
      thereon upon three business days’ prior notice to the Holder.

     

    4. Events
      of Default.
      Each of
      the following events shall be an “Event of Default”:

     

    (a) The
      Borrower shall fail to pay any amount due under this Note when the same shall
      have become due and payable.

     

    (b) A
      decree
      or order is entered by a court having jurisdiction in the premises for relief
      in
      respect of the Borrower under any bankruptcy, insolvency or similar act, law
      or
      statute now or hereafter in effect, or adjudging the Borrower as bankrupt or
      insolvent, or approving a petition seeking reorganization, adjustment or
      composition of or in respect of the Borrower under Title XI of the United States
      of America Code, as now constituted or hereafter in effect, or under any other
      applicable Federal or State bankruptcy law or other similar law, or a receiver,
      liquidator, assignee, trustee, sequestrator (or similar official) of the
      Borrower or of any substantial part of its property, is appointed, or an order
      is entered for the winding up or liquidation of the Borrower’s affairs and any
      such decree or order continues unstayed and in effect for a period of ninety
      (90) consecutive days.

     

    (c) The
      Borrower files any petition, application, answer or consent to or for
      liquidation, reorganization, arrangement or any other relief under any Chapter
      of Title XI of the United States of America Code or any applicable State or
      Federal law or statute, as now or hereafter in effect, or the Borrower consents
      to, or fails to contest in a timely and appropriate manner, the filing of any
      such petition or application for the relief requested therein, or the consent,
      or fails to contest in a timely and appropriate manner, the appointment or
      taking possession by a receiver, liquidator, assignee, trustee, custodian,
      sequestrator (or other similar official) of the Borrower or of any substantial
      part of its property, or the Borrower makes an assignment for the benefit of
      creditors, or the Borrower admits in writing its inability to pay its debts
      generally as they become due, or Borrower fails generally to pay its debts
      as
      such debts become due, or the Borrower or any of its officers, managers or
      members acts in furtherance of any such action.

     

     

    5. Effect
      of Event of Default.
      Subject
      to Section 8, if no Senior Debenture (as defined below) is outstanding and
      an
      Event of Default occurs and is continuing, the Holder may, by notice to the
      Borrower, declare the principal amount then outstanding of, and the accrued
      interest on, this Note and all other amounts payable under this Note to be
      forthwith due and payable, whereupon such amounts shall be immediately due
      and
      payable without presentment, demand, protest or other formalities of any kind,
      all of which hereby are expressly waived by the Borrower. 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    6.Right
      to Convert.
      

     

     (a)
       Subject
      to and upon compliance with the provisions of this Note, if
      no
      Senior Debenture (as defined below) is outstanding,
      the
      Holder shall have the right, at its option, at any time following the date
      hereof, to convert the principal of this Note and accrued and unpaid interest
      hereon, or any portion thereof, as follows: The conversion price shall be equal
      to $0.50 per share. In order to exercise this conversion privilege, the Holder
      shall deliver to the Borrower written notice of its election to convert this
      Note (a "Conversion Notice"), which shall specify the amount of principal and/or
      interest to be so converted, and, if all principal and accrued and unpaid
      interest due hereunder is to be converted, the Holder shall surrender this
      Note,
      duly endorsed, to the Borrower. The Conversion Notice shall also state the
      name
      or names (with address) in which the shares of Common Stock which shall be
      issuable on such conversion shall be issued, and shall be accompanied by
      transfer taxes, if required pursuant to Section 4 of this Note. The Holder
      and
      the Borrower shall maintain records showing the principal and interest converted
      and the dates of such conversions or shall use such other method, reasonably
      satisfactory to the Holder and the Borrower, so as not to require physical
      surrender of this Note upon a partial conversion. No fractional shares of Common
      Stock shall be issued upon conversion of this Note. If any fractional share
      of
      stock otherwise would be issuable upon the conversion of this Note, the Borrower
      shall calculate and pay a cash adjustment in lieu of such fractional share
      at
      the current market value thereof, as determined in good faith by the Borrower's
      Board of Directors, to the Holder. 

     

    (b) In
      case
      the outstanding shares of Common Stock shall be subdivided into a greater number
      of shares of Common Stock, the Conversion Price in effect at the opening of
      business on the day following the day upon which such subdivision becomes
      effective shall be proportionately reduced, and conversely, in case outstanding
      shares of Common Stock shall be combined into a smaller number of shares of
      Common Stock, the Conversion Price in effect at the opening of business on
      the
      day following the day upon which such combination becomes effective shall be
      proportionately increased, such reduction or increase, as the case may be,
      to
      become effective immediately after the opening of business on the day following
      the day upon which such subdivision or combination becomes
      effective.

    

    (c) The
      Borrower covenants that all shares of Common Stock issuable upon conversion
      of
      this Note will be fully paid and non-assessable and free from all taxes, liens
      and charges with respect to the issue thereof.

    

    7. Taxes
      on Shares Issued.
      The
      issue of stock certificates on conversion of this Note shall be made without
      charge to the Holder for any tax in respect of the issue thereof. The Borrower
      shall not, however, be required to pay any tax which may be payable in respect
      of any transfer involved in the issue and delivery of stock in any name other
      than that of the Holder, and the Borrower shall not be required to issue or
      deliver any such stock certificate unless and until the person or persons
      requesting the issue thereof shall have paid to the Borrower the amount of
      such
      tax or shall have established to the satisfaction of the Borrower that such
      tax
      has been paid.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    8. Subordination.
      The
      Borrower covenants and agrees, and the Holder likewise covenants and agrees,
      that the indebtedness represented by this Note and the payment of the principal
      amount and interest hereon or any other amounts in respect hereof is hereby
      expressly made subordinate and junior and subject in right of payment to the
      prior payment in full of all Senior Indebtedness of the Borrower now outstanding
      or hereinafter incurred. The Holder agrees not to ask, demand, sue for, take
      or
      receive from Borrower, directly or indirectly, in cash or other property, or
      by
      set-off or in any other manner (including without limitation from or by way
      of
      collateral), payment of all or any of the obligations arising under the Note
      and
      until the payment in full of the Senior Indebtedness (defined herein). "Senior
      Indebtedness" means the principal of, and premium, if any, and interest on,
      fees, costs and expenses in connection with and other amounts due under the
      Borrower's Senior Secured Convertible Debentures due 2009 issued pursuant to
      the
      Securities Purchase Agreements dated January 20, 2004 and March 14, 2005 (the
      "Senior Debentures"). No payment on account of principal of or interest on
      this
      Note shall be due hereunder, and this Note shall not be paid, redeemed,
      purchased or defeased, in whole or in part, directly or indirectly, by the
      Borrower (or any of its subsidiaries), if at the time such payment would be
      due
      or such repayment, purchase, redemption or defeasance would be made, any Senior
      Debenture is outstanding.

     

    9. No
      Waiver by Holder.
      No
      single or partial exercise of any power hereunder shall preclude other or
      further exercise thereof or the exercise of any other power. No delay or
      omission on the part of the Holder in exercising any right hereunder shall
      operate as a waiver of such right or of any other right hereunder. Acceptance
      of
      any sum by the Holder that is less than full payment shall not be construed
      as a
      waiver of any default in the payment of this Note.

    

    10. Savings
      Clause.
      In the
      event any provisions of this Note shall result, for any reason and at any time,
      in an effective rate of interest that exceeds the limit of the usury or any
      other law applicable to interest on the indebtedness evidenced hereby, all
      sums
      in excess of those lawfully collectible as interest for the period in question
      shall be (a) applied, to the extent of such excess, against the unpaid portion
      of the principal amount evidenced hereby with the same force and effect as
      though the Holder had agreed to accept such extra payment(s) as a prepayment
      or
      (b) if the indebtedness has been fully paid, refunded by the Holder to the
      Borrower to the extent of such excess.

     

    11. Successors
      and Assigns.
      The
      provisions hereof shall be binding upon the legal representatives, successors
      and assigns of the Borrower and shall inure to the benefit of the Holder and
      its
      successors by operation of law.

     

    12. Amendment.
      This
      Note may from time to time be extended or renewed, with or without notice to
      the
      Borrower, and any related right may be waived, exchanged, surrendered or
      otherwise dealt with, all without affecting the liability of the
      Borrower.

    

    13. Governing
      Law.
      This
      Note shall be governed by and construed and interpreted in accordance with
      the
      laws of the State of Florida (irrespective of the choice of laws principles
      of
      the State of Florida), as to all matters, including matters of validity,
      construction, effect, enforceability, performance and remedies.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    14. Section
      Headings.
      The
      headings contained in this Note are for reference purposes only and shall not
      affect in any way the meaning or interpretation hereof.

     

    15. Derivatives.
      If for
      any reason, this Note or any provision thereof be interpreted or deemed to
      result in Borrower derivative liability under generally accepted accounting
      principles, as interpreted and enforced by the U.S. Securities and Exchange
      Commission, then the terms of this Note shall be deemed amended, ab
      initio,
      to the
      full extent necessary to eliminate such derivative liability, provided that
      nothing in any such amendment(s) shall reduce or eliminate the Borrower’s
      obligations to pay to the Holder the principal and interest called for
      hereunder, subject to the other terms hereof.

     

    

    

    [Remainder
      of Page Intentionally Left Blank.]

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the Borrower has caused this Note to be executed by a duly
      authorized officer as of date first above written.

     

    
      	 	
              ENER1,
                INC.

            
	
               

            	
            
	 	
              By:
                

            	
              /s/
                Dr. Peter
                Novak                         
                

            
	 	
              Name:
                

            	
              Dr.
                Peter Novak

            
	 	
              Title:
                

            	
              Chief
                Executive Officer

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