Exhibit 10.03

Execution Copy

THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAW, AND MAY NOT BE OFFERED FOR SALE, SOLD OR
TRANSFERRED UNLESS A REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS SHALL BE EFFECTIVE WITH RESPECT THERETO, OR AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER AND THE HOLDER
DELIVERS TO THE ISSUER AN OPINION OF COUNSEL IN A FORM REASONABLY SATISFACTORY
TO THE ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OR SUCH
OFFER, SALE OR TRANSFER IS MADE PURSUANT TO RULE 144 UNDER THE SECURITIES ACT.
SUBJECT TO COMPLIANCE WITH THE REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE
STATE SECURITIES LAWS, THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THIS WARRANT MAY BE PLEDGED OR HYPOTHECATED IN CONNECTION WITH A BONA FIDE
MARGIN LOAN OR EXTENSION OF CREDIT SECURED BY THIS WARRANT OR ANY OF THE
SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT WITHOUT REQUIRING THE CONSENT
OF THE ISSUER OR THE DELIVERY OF ANY SUCH OPINION.

WARRANT

TO PURCHASE COMMON STOCK

OF

ENER1, INC.

Issue Date: January 5, 2007 Warrant No. 1

THIS CERTIFIES that CREDIT SUISSE SECURITIES (USA), LLC or any subsequent holder
hereof (the “Holder”), has the right to purchase from ENER1, INC., a Florida
corporation (the “Company”), up to five million (5,000,000) fully paid and
nonassessable shares of the Company’s common stock, par value $0.01 per share
(the “Common Stock”), subject to adjustment as provided herein, at a price per
share equal to the Exercise Price (as defined below), beginning on the date on
which this Warrant is issued (the “Issue Date”) and ending at 5:00 p.m., New
York time, on the fifth (5th) anniversary of the Issue Date (the “Expiration
Date”). This Warrant is issued pursuant to a Purchase Agreement, dated as of
January 5, 2007 (the “Purchase Agreement”). Capitalized terms used herein and
not otherwise defined shall have the respective meanings set forth in the
Purchase Agreement.

1. Exercise.

(a) Right to Exercise; Exercise Price. The Holder shall have the right to
exercise this Warrant at any time and from time to time as to all or any part of
the shares of Common Stock issuable hereunder (the “Warrant Shares”). The
“Exercise Price” for each Warrant Share purchased by the Holder upon the
exercise of this Warrant shall be equal to $0.30, subject to adjustment for the
events specified in Section 5 below. The Holder may pay the Exercise Price in
either of the following forms or, at the election of the Holder, a combination
thereof:

(i) through a cash exercise (a “Cash Exercise”) by delivering immediately
available funds, or

(ii) if, at any time following the Registration Deadline (as defined in the
Registration Rights Agreement), an effective Registration Statement is not
available for the resale of all of the Warrant Shares issuable hereunder at the
time an Exercise Notice is delivered to the Company, through a cashless exercise
(a “Cashless Exercise”). The Holder may effect a Cashless Exercise by
surrendering this Warrant to the Company and noting on the Exercise Notice that
the Holder wishes to effect a Cashless Exercise, upon which the Company shall
issue to the Holder the number of Warrant Shares determined as follows:

X = Y x (A-B)/A

      where: X = the number of Warrant Shares to be issued to the Holder;

Y = the number of Warrant Shares with respect to which this Warrant is being
exercised;

A = the Trading Price (as defined in the Registration Rights Agreement) as of
the Exercise Date; and

B = the Exercise Price.

For purposes of Rule 144, it is intended and acknowledged that the Warrant
Shares issued in a Cashless Exercise transaction shall be deemed to have been
acquired by the Holder, and the holding period for the Warrant Shares required
by Rule 144 shall be deemed to have been commenced, on the Issue Date.

(b) Exercise Notice. In order to exercise this Warrant, the Holder shall
(i) send by facsimile transmission, at any time prior to 5:00 p.m., New York
time, on the Business Day on which the Holder wishes to effect such exercise
(the “Exercise Date”), to the Company an executed copy of the notice of exercise
in the form attached hereto as Exhibit A (the “Exercise Notice”), (ii) deliver
the original Warrant and (iii) in the case of a Cash Exercise, pay the Exercise
Price to the Company by wire transfer in immediately available funds. The
Exercise Notice shall also state the name or names (with address) in which the
shares of Common Stock that are issuable on such exercise shall be issued. If
shares are to be issued in the name of a person other than the Holder, the
Holder will pay all transfer taxes payable with respect thereto.

(c) Holder of Record. The Holder shall, for all purposes, be deemed to have
become the holder of record of the Warrant Shares specified in an Exercise
Notice on the Exercise Date specified therein, irrespective of the date of
delivery of such Warrant Shares, subject to payment of the Exercise Price.
Except as specifically provided herein, nothing in this Warrant shall be
construed as conferring upon the Holder hereof any rights as a shareholder of
the Company, including, without limitation, the right to vote, the right to
receive dividends or other distributions made to shareholders of the Company,
and the right to exercise preemptive rights, prior to the Exercise Date.

(d) Cancellation of Warrant. This Warrant shall be canceled upon its exercise
and, if this Warrant is exercised in part, the Company shall, at the time that
it delivers Warrant Shares to the Holder pursuant to such exercise as provided
herein, issue a new warrant, and deliver to the Holder a certificate
representing such new warrant, with terms identical in all respects to this
Warrant (except that such new warrant shall be exercisable into the number of
shares of Common Stock with respect to which this Warrant shall remain
unexercised); provided, however, that the Holder shall be entitled to exercise
all or any portion of such new warrant at any time following the time at which
this Warrant is exercised, regardless of whether the Company has actually issued
such new warrant or delivered to the Holder a certificate therefor.

2. Delivery of Warrant Shares Upon Exercise. Upon receipt of an Exercise Notice
pursuant to Section 1, the Company shall, no later than the close of business on
the later to occur of (i) the third (3rd) Business Day following the Exercise
Date set forth in such Exercise Notice and (ii) the date on which the Company
has received payment of the Exercise Price and the taxes specified in
Section 1(b), if any, are paid in full (a “Delivery Date”), issue and deliver or
cause to be delivered to the Holder the number of Warrant Shares as shall be
determined as provided herein. The Company shall effect delivery of Warrant
Shares to the Holder by, as long as the Transfer Agent participates in the
Depository Trust Company (“DTC”) Fast Automated Securities Transfer program
(“FAST”), crediting the account of the Holder or its nominee at DTC (as
specified in the applicable Exercise Notice) with the number of Warrant Shares
required to be delivered, no later than the close of business on such Delivery
Date. In the event that the Transfer Agent is not a participant in FAST, or if
the Warrant Shares are not otherwise eligible for delivery through FAST, or if
the Holder so specifies in an Exercise Notice or otherwise in writing on or
before the Exercise Date, the Company shall effect delivery of Warrant Shares by
delivering to the Holder or its nominee physical certificates representing such
Warrant Shares, no later than the close of business on such Delivery Date.

3. Failure to Deliver Warrant Shares.

(a) In the event that the Company fails for any reason (other than as a result
of the Holder’s failure to deliver the original Warrant to the Company or to pay
the aggregate Exercise Price for the Warrant Shares being purchased) to deliver
to the Holder the number of Warrant Shares specified in the applicable Exercise
Notice on or before the Delivery Date therefor (an “Exercise Default”), and such
default continues for five (5) Business Days following delivery of a written
notice of such default by the Holder to the Company, the Company shall pay to
the Holder payments (“Exercise Default Payments”) in the amount of (i) (N/365)
multiplied by (ii) the aggregate Exercise Price of the Warrant Shares which are
the subject of such Exercise Default multiplied by (iii) the lower of fifteen
percent (15%) and the maximum rate permitted by applicable law (the “Default
Interest Rate”), where “N” equals the number of days elapsed between the
original Delivery Date of such Warrant Shares and the date on which all of such
Warrant Shares are issued and delivered to the Holder. Cash amounts payable
hereunder shall be paid on or before the fifth (5th) Business Day of each
calendar month following the calendar month in which such amount has accrued.

(b) The Holder’s rights and remedies hereunder are cumulative, and no right or
remedy is exclusive of any other. In addition to the amounts specified herein,
the Holder shall have the right to pursue all other remedies available to it at
law or in equity (including, without limitation, a decree of specific
performance and/or injunctive relief). Nothing herein shall limit the Holder’s
right to pursue actual damages for the Company’s failure to issue and deliver
Warrant Shares on the applicable Delivery Date (including, without limitation,
damages relating to any purchase of Common Stock by the Holder to make delivery
on a sale effected in anticipation of receiving Warrant Shares upon exercise,
such damages to be in an amount equal to (A) the aggregate amount paid by the
Holder for the Common Stock so purchased minus (B) the aggregate amount of net
proceeds, if any, received by the Holder from the sale of the Warrant Shares
issued by the Company pursuant to such exercise).

4. Exercise Limitations. In no event shall the Holder be permitted to exercise
this Warrant, or part thereof, if, upon such exercise, the number of shares of
Common Stock beneficially owned by the Holder (other than shares which would
otherwise be deemed beneficially owned except for being subject to a limitation
on conversion or exercise analogous to the limitation contained in this
Section 4, would exceed 4.99% of the number of shares of Common Stock then
issued and outstanding. As used herein, beneficial ownership shall be determined
in accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended, and the rules thereunder. To the extent that the limitation contained
in this Section 4 applies, the submission of an Exercise Notice by the Holder
shall be deemed to be the Holder’s representation that this Warrant is
exercisable pursuant to the terms hereof and the Company shall be entitled to
rely on such representation without making any further inquiry as to whether
this Section 4 applies. The Company shall have no liability to any person if the
Holder’s determination of whether this Warrant is convertible pursuant to the
terms hereof is incorrect. Nothing contained herein shall be deemed to restrict
the right of a Holder to exercise this Warrant, or part thereof, at such time as
such exercise will not violate the provisions of this Section 4. This Section 4
may not be amended unless such amendment is agreed to in writing by the Holder
and approved by the holders of a majority of the Common Stock then outstanding;
provided, however, that the Holder shall have the right to waive the provisions
of this Section 4 upon prior written notice to the Company following the
announcement of a Major Transaction (as defined below), or otherwise upon sixty
(60) days’ prior written notice to the Company.

5. Adjustments to Exercise Price; Distributions; Repurchase Right.

(a) Subdivision or Combination of Common Stock. If the Company, at any time
after the Issue Date, subdivides (by any stock split, stock dividend,
recapitalization, reorganization, reclassification or otherwise) its shares of
Common Stock into a greater number of shares, then after the date of record for
effecting such subdivision, the Exercise Price in effect immediately prior to
such subdivision will be proportionately reduced. If the Company, at any time
after the Issue Date, combines (by reverse stock split, recapitalization,
reorganization, reclassification or otherwise) its shares of Common Stock into a
smaller number of shares, then, after the date of record for effecting such
combination, the Exercise Price in effect immediately prior to such combination
will be proportionally increased. Any adjustment made pursuant to this
Section 5(a) that results in a decrease or increase in the Exercise Price shall
also effect a proportional increase or decrease, as the case may be, in the
number of shares of Common Stock into which this Warrant is exercisable.

(b) Distributions. If the Company shall declare or make any distribution of its
assets (or rights to acquire its assets) to holders of Common Stock as a partial
liquidating dividend or otherwise (including any dividend or distribution to the
Company’s stockholders in cash or shares (or rights to acquire shares) of
capital stock of a subsidiary) (a “Distribution”), the Company shall deliver
written notice of such Distribution (a “Distribution Notice”) to the Holder at
least fifteen (15) Business Days prior to the earlier to occur of (i) the record
date for determining stockholders entitled to such Distribution (the “Record
Date”) and (ii) the date on which such Distribution is made (the “Distribution
Date”). The Holder shall be entitled, at its option (to be exercised by written
notice delivered to the Company on or before the fifteenth (15th) Business Day
following the date on which a Distribution Notice is delivered to the Holder),
either (A) upon any exercise of this Warrant on or after the Record Date, to be
entitled to receive, on the Distribution Date (for any exercise effected prior
to the Distribution Date) or the applicable Delivery Date (for any exercise
effected after the Distribution Date), the amount of such assets which would
have been payable to the holder with respect to the shares of Common Stock
issuable upon such exercise (without giving effect to any limitations on such
exercise contained in this Warrant or the Purchase Agreement) had the Holder
been the holder of such shares of Common Stock on the Record Date or (B) upon
any exercise of this Warrant on or after the Distribution Date, to reduce the
Exercise Price applicable to such exercise by reducing the Exercise Price in
effect on the Business Day immediately preceding the Record Date by an amount
equal to the fair market value of the assets to be distributed divided by the
number of shares of Common Stock as to which such Distribution is to be made,
such fair market value to be reasonably determined in good faith by the
independent members of the Company’s Board of Directors. Notwithstanding
anything herein to the contrary, if the Holder does not notify the Company of
whether the Holder has elected clause (A) or (B) in the preceding sentence by
the date that is fifteen (15) Business Days after the date on which the Company
delivers a Distribution Notice to the Holder, the Company shall have the right,
exercisable upon written notice to the Holder, to determine whether clause
(A) or (B) shall be applicable to exercises of this Warrant effected on or after
the Distribution Date.

(c) Repurchase Right. If the Holder exercises its Repurchase Right under the
Purchase Agreement, then, effective concurrently with such exercise and without
any further action by or consideration from the Company or the Holder, the total
number of shares of Common Stock for which this Warrant is then exercisable
shall be reduced by fifty percent (50%).

6. Major Transactions. In the event of a merger, consolidation, business
combination, tender offer, exchange of shares, recapitalization, reorganization,
redemption or other similar event, as a result of which shares of Common Stock
shall be changed into the same or a different number of shares of the same or
another class or classes of stock or securities or other assets of the Company
or another entity or the Company shall sell all or substantially all of its
assets (each of the foregoing being a “Major Transaction”), the Company will
give the Holder at least ten (10) Trading Days’ written notice prior to the
earlier of (I) the closing or effectiveness of such Major Transaction and
(II) the record date for the receipt of such shares of stock or securities or
other assets, and the Holder shall be permitted to exercise this Warrant in
whole or in part at any time prior to the record date for the receipt of such
consideration and shall be entitled to receive, for each share of Common Stock
issuable to the Holder upon such exercise, the same per share consideration
payable to the other holders of Common Stock in connection with such Major
Transaction. If and to the extent that the Holder retains this Warrant or any
portion hereof following such record date, the Company will cause the surviving
or, in the event of a sale of assets, purchasing entity, as a condition
precedent to such Major Transaction, to assume the obligations of the Company
with respect to this Warrant, with such adjustments to the Exercise Price and
the securities covered hereby as may be necessary in order to preserve the
economic benefits of this Warrant to the Holder.

7. Fractional Interests. No fractional shares or scrip representing fractional
shares shall be issuable upon the exercise of this Warrant. If, on exercise of
this Warrant, the Holder hereof would be entitled to a fractional share of
Common Stock or a right to acquire a fractional share of Common Stock, the
Company shall, in lieu of issuing any such fractional share, pay to the Holder
an amount in cash equal to the product resulting from multiplying such fraction
by the Trading Price as of the Exercise Date.

8. Transfer of this Warrant. The Holder may sell, transfer, assign, pledge or
otherwise dispose of this Warrant, in whole or in part, as long as such sale or
other disposition is made pursuant to an effective registration statement or an
exemption from the registration requirements of the Securities Act, and
applicable state securities laws, and is otherwise made in accordance with the
applicable provisions of the Purchase Agreement. Upon such transfer or other
disposition, the Holder shall deliver this Warrant to the Company together with
a written notice to the Company, substantially in the form of the Transfer
Notice attached hereto as Exhibit B (a “Transfer Notice”), indicating the person
or persons to whom this Warrant shall be transferred and, if less than all of
this Warrant is transferred, the number of Warrant Shares to be covered by the
part of this Warrant to be transferred to each such person. Within ten
(10) Business Days of receiving a Transfer Notice and the original of this
Warrant, the Company shall deliver to the each transferee designated by the
Holder a Warrant or Warrants of like tenor and terms for the appropriate number
of Warrant Shares and, if less than all this Warrant is transferred, shall
deliver to the Holder a Warrant for the remaining number of Warrant Shares.

9. Benefits of this Warrant; Headings. This Warrant shall be for the sole and
exclusive benefit of the Holder of this Warrant and nothing in this Warrant
shall be construed to confer upon any person other than the Holder of this
Warrant any legal or equitable right, remedy or claim hereunder. The headings
used in this Warrant are for convenience of reference only and shall not limit
or otherwise affect the meaning hereof.

10. Loss, theft, destruction or mutilation of Warrant. Upon receipt by the
Company of evidence of the loss, theft, destruction or mutilation of this
Warrant, and (in the case of loss, theft or destruction) of indemnity reasonably
satisfactory to the Company, and upon surrender of this Warrant, if mutilated,
the Company shall execute and deliver a new Warrant of like tenor and date in
replacement for the lost, stolen, destroyed or mutilated Warrant.

11. Notice or Demands. Any notice, demand or request required or permitted to be
given by the Company or the Holder pursuant to the terms of this Warrant shall
be in writing and shall be deemed delivered (i) when delivered personally or by
verifiable facsimile transmission, unless such delivery is made on a day that is
not a Business Day, in which case such delivery will be deemed to be made on the
next succeeding Business Day, (ii) on the next Business Day after timely
delivery to an overnight courier and (iii) on the Business Day actually received
if deposited in the U.S. mail (certified or registered mail, return receipt
requested, postage prepaid), addressed as follows:

If to the Company or the Issuer:

     
Ener1 Group, Inc.
712 Fifth Avenue, Suite 9A
New York, New York 10019
 

 
    Attention: Charles Gassenheimer

 
   
Tel:
Fax:
  (212) 920-3500
(212) 920-3510

and if to the Holder, to such address as shall be designated by the Holder in
writing to the Company.

  12.   Taxes.

(a) The issue of stock certificates on exercises of this Warrant shall be made
without charge to the exercising Holder for any tax in respect of the issue
thereof. The Company 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 of any Warrant exercised, and the
Company 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 Company the amount of such tax or shall have established to the
reasonable satisfaction of the Company that such tax has been paid.

(b) Notwithstanding any other provision of this Warrant or any other Transaction
Document, for income tax purposes, any assignee or transferee shall agree that
the Company and the Transfer Agent shall be permitted to withhold from any
amounts payable to such assignee or transferee any taxes required by law to be
withheld from such amounts. Unless exempt from the obligation to do so, each
assignee or transferee shall, upon request, execute and deliver to the Company
or the Transfer Agent, as applicable, a properly completed Form W-8 or W-9,
indicating that such assignee or transferee is not subject to back-up
withholding for United States Federal income tax purposes.

13. Governing Law. This Warrant shall be governed by and construed under the
laws of the State of New York applicable to contracts made and to be performed
entirely within the State of New York. The Company hereby irrevocably submits to
the non-exclusive jurisdiction of the state and federal courts sitting in the
City and County of New York for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is brought in an inconvenient forum
or that the venue of such suit, action or proceeding is improper. The Company
hereby irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by mailing a copy thereof to
it at the address in effect for notices to it under this Warrant and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.

14. Amendments. Except as expressly provided herein, neither this Warrant nor
any term hereof may be amended except pursuant to a written instrument executed
by the Company and the Holder, and no provision hereof may be waived other than
by a written instrument signed by the party against whom enforcement of any such
waiver is sought. Any waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.

15. Successors and Assigns. This Warrant shall be binding upon the successors
and permitted assigns of the parties. The Company may not assign its rights or
obligations under this Agreement without the prior written consent of the
Holder, which consent shall not be unreasonably withheld.

[Signature Page to Follow]

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IN WITNESS WHEREOF, the Company has duly executed and delivered this Warrant as
of the Issue Date.

ENER1, INC.

By:      
Charles Gassenheimer
Vice Chairman

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EXHIBIT A to WARRANT

EXERCISE NOTICE

The undersigned Holder hereby irrevocably exercises the right to purchase of the
shares of Common Stock (“Warrant Shares”) of ENER1, INC. evidenced by the
attached Warrant (the “Warrant”). Capitalized terms used herein and not
otherwise defined shall have the respective meanings set forth in the Warrant.

1. Form of Exercise Price. The Holder intends that payment of the Exercise Price
shall be made as:

     a Cash Exercise with respect to      Warrant Shares; and/or

     a Cashless Exercise with respect to      Warrant Shares, as permitted by
Section 1(a) of the attached Warrant.

2. Payment of Exercise Price. In the event that the Holder has elected a Cash
Exercise with respect to some or all of the Warrant Shares to be issued pursuant
hereto, the Holder shall pay the sum of $     to the Company in accordance with
the terms of the Warrant.

By tendering this Exercise Notice, the Holder represents to the Company that it
is an “accredited investor” as that term is defined in Rule 501 of Regulation D
under the Securities Act, and that it is acquiring the Warrants Shares solely
for its own account, and not with a present view to the public resale or
distribution of all or any part thereof.

Date:      

     

Name of Registered Holder

By:      
Name:
Title:

EXHIBIT B to WARRANT

TRANSFER NOTICE

FOR VALUE RECEIVED, the undersigned Holder of the attached Warrant hereby sells,
assigns and transfers unto the person or persons named below the right to
purchase shares of the Common Stock of ENER1, INC. evidenced by the attached
Warrant.

Date:      

     

Name of Registered Holder

By:      
Name:
Title:

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