UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


WASHINGTON,
      D.C. 20549




FORM
      10-QSB




(Mark
      One)




x QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934




For
      the
      quarterly period ended December 31, 2005





oTRANSITION
      REPORT UNDER
      SECTION 13 OR 15(d) OF THE EXCHANGE ACT





For
      the
      transition period from ____________ to_________________





Commission
      file number 333-116817




Splinex
      Technology Inc.


(Exact
      name of small business issuer as specified in its charter)




**Delaware**
              **20-0715816**(State
                  or other jurisdiction of incorporation or organization)
              (IRS
                  Employer Identification No.)





550
      W.
      Cypress Creek Road Suite 410


Fort
      Lauderdale, FL 33309


(Address
      of principal executive offices)





(954)
      660-6565


(Issuer’s
      telephone number)





(Former
      name, former address and former fiscal year, if changed since last
      report)





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Exchange Act during the past 12 months (or for such shorter period
      that the registrant was required to file such reports), and (2) has been subject
      to such filing requirements for the past 90 days. Yes X No ⍷




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act.) Yes [ ] No [X]




State
      the
      number of shares outstanding of each of the issuer’s classes of common equity,
      as of the latest practicable date: On February 14, 2006, the number of shares
      outstanding of the registrant’s common stock was 100,420,270
      shares.





Transitional
      Small Business Disclosure Format (Check one): Yes ⑀ No X











**SPLINEX
      TECHNOLOGY INC.**


**Form
      10-QSB**


**For
      the Quarter Ended December 31, 2005**


**INDEX**





PageNo.PART
                I — FINANCIAL INFORMATIONItem
                1.
            Financial
                StatementsCONDENSED
                CONSOLIDATED UNAUDITED BALANCE SHEET - AS OF DECEMBER 31, 2005 AND
                MARCH
                31, 2005
            3CONDENSED
                CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS - FOR THE THREE MONTHS
                AND
                NINE MONTHS ENDED DECEMBER 31, 2005 AND 2004 AND FOR THE PERIOD FROM
                INCEPTION (OCTOBER 28, 2003) THROUGH DECEMBER 31, 2005
            4CONDENSED
                CONSOLIDATED UNAUDITED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIENCY
                IN ASSETS - PERIOD FROM INCEPTION (OCTOBER 28, 2003) THROUGH DECEMBER
                31,
                2005
            5CONDENSED
                CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS - FOR THE NINE MONTHS
                ENDED DECEMBER 31, 2005 AND 2004 AND FOR THE PERIOD FROM INCEPTION
                (OCTOBER 28, 2003) THROUGH DECEMBER 31, 2005
            6Notes
                to Condensed Consolidated Financial Statements
            7Item
                2.
            Management’s
                Discussion and Analysis or Plan of Operation.
            13Item
                3.
            Controls
                and Procedures
            18PART
                II — OTHER INFORMATIONItem
                1.
            Legal
                Proceedings
            19Item
                6.
            Exhibits
            20Signatures
            21





2





PART
      I —
FINANCIAL INFORMATION





Item
      1.
      Financial Statements.





SPLINEX
      TECHNOLOGY INC.


(A
      DEVELOPMENT STAGE COMPANY)


CONDENSED
      CONSOLIDATED UNAUDITED BALANCE SHEET


December
                  31, 2005
              
              March
                  31, 2005**ASSETS**Current
                  assetsCash
              
              $
              3,522
              
              $
              256,347Prepaid
                  expenses and other
              
              
              21,886
              
              
              76,119Loans
                  and advances to employees - current portion
              
              
              1,363
              
              
              13,834Total
                  current assets
              
              
              26,771
              
              
              346,300Property
                  and equipment, net
              
              
              23,473
              
              
              49,862Accounting
                  software license
              
              
              21,874
              
              
              37,000Other
                  assets
              
              
              9,881
              
              
              9,881Loans
                  to employees - long term portion
              
              
              -
              
              
              9,875Total
                  assets
              
              $
              81,999
              
              $
              452,918**LIABILITIES
                  AND STOCKHOLDERS' DEFICIENCY IN ASSETS**Current
                  liabilitiesAccounts
                  payable
              
              
              504,796
              
              
              434,967Accrued
                  expenses
              
              
              731,367
              
              
              221,572Note
                  payable and accrued interest - related party
              
              
              254,278
              
              
              -Due
                  to related parties
              
              
              138,262
              
              
              106,760Other
                  current liabilities
              
              
              4,251
              
              
              75,849Total
                  current liabilities
              
              
              1,632,954
              
              
              839,148Long
                  term liabilitiesNote
                  payable and accrued interest - related party
              
              
              2,645,832
              
              
              1,708,240Total
                  liabilities
              
              
              4,278,786
              
              
              2,547,388**COMMITMENTS
                  AND CONTINGENCIES****STOCKHOLDERS'
                  DEFICIENCY IN ASSETS**Preferred
                  stock ($.001 par value, 150,000,000 sharesauthorized
                  and no shares issued and outstanding)
              
              
              -
              
              
              -Common
                  stock ($.001 par value, 300,000,000 sharesauthorized
                  and 100,670,270 shares issued and outstanding)
              
              
              100,670
              
              
              100,670Treasury
                  stock, at cost; 250,000 and 0 shares, respectively
              
              
              (62,500
              )
              
              -Paid
                  in capital
              
              
              1,101,049
              
              
              1,101,049Deficit
                  accumulated during the development stage
              
              
              (5,336,006
              )
              
              (3,296,189
              )Total
                  stockholders' deficiency in assets
              
              
              (4,196,787
              )
              
              (2,094,470
              )Total
                  liabilities and stockholders' deficiency in assets
              
              $
              81,999
              
              $
              452,918





See
      accompanying notes.




3


SPLINEX
      TECHNOLOGY INC.


(A
      DEVELOPMENT STAGE COMPANY)


CONDENSED
      CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS





CumulativeFrom
                  Inception(October
                  28,Three
                  Months
              
              Three
                  Months
              
              Nine
                  Months
              
              Nine
                  Months
              
              2003)Ended
              
              Ended
              
              Ended
              
              Ended
              
              ThroughDecember
                  31,
              
              December
                  31,
              
              December
                  31,
              
              December
                  31,
              
              December
                  31,2005
              
              2004
              
              2005
              
              2004
              
              2005Net
                  sales
              
              $
              907
              
              $
              24
              
              $
              1,594
              
              $
              48
              
              
              1,643Operating
                  ExpensesSales
                  and marketing
              
              
              5,448
              
              
              67,086
              
              
              195,567
              
              
              185,021
              
              
              560,845General
                  and administrative
              
              
              164,092
              
              
              285,388
              
              
              1,122,252
              
              
              867,129
              
              
              3,028,158Research
                  and development
              
              
              45,350
              
              
              380,581
              
              
              633,553
              
              
              824,226
              
              
              1,956,075Total
                  operating expenses
              
              
              214,890
              
              
              733,055
              
              
              1,951,372
              
              
              1,876,376
              
              
              5,545,078Costs
                  of merger and registration
              
              
              -
              
              
              167,643
              
              
              -
              
              
              512,320
              
              
              512,321Total
                  expenses
              
              
              214,890
              
              
              900,698
              
              
              1,951,372
              
              
              2,388,696
              
              
              6,057,399Loss
                  from operations
              
              
              (213,983
              )
              
              (900,674
              )
              
              (1,949,778
              )
              
              (2,388,648
              )
              
              (6,055,756
              )Interest
                  expense, net
              
              
              (34,130
              )
              
              (936
              )
              
              (90,039
              )
              
              (936
              )
              
              (103,097
              )Loss
                  before income taxes
              
              
              (248,113
              )
              
              (901,610
              )
              
              (2,039,817
              )
              
              (2,389,584
              )
              
              (6,158,853
              )Income
                  taxes
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Net
                  loss
              
              $
              (248,113
              )
              $
              (901,610
              )
              $
              (2,039,817
              )
              $
              (2,389,584
              )
              $
              (6,158,853
              )Net
                  loss per basic anddiluted
                  share
              
              $
              (0.002
              )
              $
              (0.009
              )
              $
              (0.020
              )
              $
              (0.025
              )Weighted
                  average sharesoutstanding
              
              
              100,466,466
              
              
              95,000,000
              
              
              100,602,088
              
              
              95,000,000




See
      accompanying notes.


4


SPLINEX
      TECHNOLOGY INC.


(A
      DEVELOPMENT STAGE COMPANY)


CONDENSED
      CONSOLIDATED UNAUDITED STATEMENTS


OF
      CHANGES IN STOCKHOLDERS’ DEFICIENCY IN ASSETS




**Deficit****Accumulated**
              
              **Total****Additional**
              
              **During
                  the**
              
              **Stockholders'****Preferred
                  Stock**
              
              **Common
                  Stock**
              
              **Treasury**
              
              **Paid
                  in**
              
              **Development**
              
              **Deficiency****Shares**
              
              **Amount**
              
              **Shares**
              
              **Amount**
              
              **Stock**
              
              **Capital**
              
              **Stage**
              
              **in
                  Assets**Common
                  stock issued $0.001 per shareeffective
                  at inception on October 28, 2003
              
              
              -
              
              
              -
              
              
              95,000,000
              
              $
              95,000
              
              $
              -
              
              $
              (94,999
              )
              $
              -
              
              $
              1Additional
                  capital contributed during period
              
              
              
              
              
              
              
              
              -
              
              
              -
              
              
              
              
              
              849,999
              
              
              -
              
              
              849,999Net
                  loss (see Note 5)
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (822,847
              )
              
              -
              
              
              (822,847
              )Balance
                  at March 31, 2004
              
              
              -
              
              
              -
              
              
              95,000,000
              
              
              95,000
              
              
              
              
              
              (67,847
              )
              
              -
              
              
              27,153Additional
                  capital contributed during period
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              1,150,000
              
              
              -
              
              
              1,150,000Shares
                  issued as executive compensationand
                  other expenses
              
              
              -
              
              
              -
              
              
              670,270
              
              
              670
              
              
              
              
              
              23,896
              
              
              -
              
              
              24,566Shares
                  issued in Merger
              
              
              -
              
              
              -
              
              
              5,000,000
              
              
              5,000
              
              
              
              
              
              (5,000
              )
              
              -
              
              
              -Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (3,296,189
              )
              
              (3,296,189
              )Balance
                  at March 31, 2005
              
              
              -
              
              
              -
              
              
              100,670,270
              
              
              100,670
              
              
              
              
              
              1,101,049
              
              
              (3,296,189
              )
              
              (2,094,470
              )Acquisition
                  of treasury stock
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (62,500
              )
              
              
              
              
              
              
              
              (62,500
              )Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (2,039,817
              )
              
              (2,039,817
              )Balance
                  at December 31, 2005
              
              
              -
              
              $
              -
              
              
              100,670,270
              
              $
              100,670
              
              $
              (62,500
              )
              $
              1,101,049
              
              $
              (5,336,006
              )
              $
              (4,196,787
              )







See
      accompanying notes.




5


SPLINEX
      TECHNOLOGY INC.


(A
      DEVELOPMENT STAGE COMPANY)


CONDENSED
      CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS


CumulativeFrom
                  Inception(October
                  28,Nine
                  Months
              
              Nine
                  Months
              
              2003)Ended
              
              Ended
              
              ThroughDecember
                  31, 2005
              
              December
                  31, 2004
              
              December
                  31, 2005Cash
                  flows from operating activities:Net
                  loss
              
              $
              (2,039,817
              )
              $
              (2,389,584
              )
              $
              (6,158,853
              )Adjustments
                  to reconcile net loss to netcash
                  used in operating activities:Depreciation
              
              
              18,776
              
              
              17,459
              
              
              48,344Other
                  non cash expense items
              
              
              (54,888
              )
              
              -
              
              
              (30,322
              )Non
                  cash interest expense
              
              
              89,870
              
              
              -
              
              
              98,110Changes
                  in operating assets and liabilities:Prepaid
                  expenses and other
              
              
              (2,239
              )
              
              3,857
              
              
              (49,390
              )Due
                  to related parties
              
              
              31,503
              
              
              81,282
              
              
              138,262Accounts
                  payable
              
              
              69,829
              
              
              497,351
              
              
              504,796Accrued
                  expenses
              
              
              509,795
              
              
              216,906
              
              
              731,367Total
                  adjustments
              
              
              662,646
              
              
              816,855
              
              
              1,441,167Net
                  cash used in operating activities
              
              
              (1,377,171
              )
              
              (1,572,729
              )
              
              (4,717,686
              )Cash
                  flows from investing activities:Purchase
                  of equipment
              
              
              -
              
              
              (20,706
              )
              
              (79,429
              )Employee
                  (loans) and repayments
              
              
              22,346
              
              
              (26,993
              )
              
              (1,363
              )Net
                  cash used in investing activities
              
              
              22,346
              
              
              (47,699
              )
              
              (80,792
              )Cash
                  flows from financing activities:Note
                  payable related parties
              
              
              1,102,000
              
              
              350,000
              
              
              2,802,000Contributed
                  capital from equity investors
              
              
              -
              
              
              1,150,000
              
              
              2,000,000Net
                  cash provided by financing activities
              
              
              1,102,000
              
              
              1,500,000
              
              
              4,802,000Net
                  increase (decrease) in cash
              
              
              (252,825
              )
              
              (120,428
              )
              
              3,522Cash
                  at beginning of period
              
              
              256,347
              
              
              165,413
              
              
              -Cash
                  at end of period
              
              $
              3,522
              
              $
              44,985
              
              $
              3,522Supplemental
                  Disclosure of Cash Flow InformationCash
                  paid during the year for:Interest
              
              $
              -
              
              $
              -
              
              $
              -Income
                  taxes
              
              $
              -
              
              $
              -
              
              $
              -Non-cash
                  investing and financing activities:Common
                  stock issued in merger
              
              $
              -
              
              $
              -
              
              $
              150,000Costs
                  of merger recorded asreduction
                  in paid in capital
              
              $
              -
              
              $
              -
              
              $
              (150,000
              )Treasury
                  stock acquired upon terminationof
                  employment agreement
              
              $
              (62,500
              )
              
              
              
              $
              (62,500
              )




See
      accompanying notes.




6


SPLINEX
      TECHNOLOGY INC.


(A
      DEVELOPMENT STAGE COMPANY)


NOTES
      TO
      CONDENSED FINANCIAL STATEMENTS





NOTE
      1.
      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





Organization
      and Basis of Presentation





Splinex
      Technology Inc. ( “Technology”) was organized under the laws of the State of
      Delaware as a wholly owned subsidiary of Splinex, LLC, a Florida limited
      liability company (the “Predecessor”), to conduct the business and operations of
      the Predecessor. Under an agreement effective April 1, 2004 (the
“Contribution Agreement”), the Predecessor contributed substantially all of its
      assets, liabilities and operations to Technology. The financial statements
      include the accounts of Technology and the Predecessor (combined, the
“Company”), and all material intercompany transactions have been eliminated. The
      Company began its development stage activity on October 28, 2003
      (“Inception”).





The
        accompanying unaudited condensed consolidated financial statements have been
        prepared in accordance with generally accepted accounting principles for
        interim
        financial information and Regulation S-B. Accordingly, they do not include
        all
        of the information and footnotes required for complete financial statements.
        In
        the opinion of management, all adjustments (consisting of normal recurring
        adjustments) considered necessary for a fair presentation of the results
        for the
        interim periods presented have been included. These results have been determined
        on the basis of generally accepted accounting principles and practices applied
        consistently with those used in the preparation of the Company's Annual
        Financial Statements for the year ended March 31, 2005. Operating results
        for
        the nine months ended December 31, 2005 are not necessarily indicative of
        the
        results that may be expected for the year ending March 31, 2006. It is
        recommended that the accompanying condensed consolidated financial statements
        be
        read in conjunction with the financial statements and notes for the year
        ended
        March 31, 2005 included in the Company’s Form 10-KSB filed with the Securities
        and Exchange Commission on June 30, 2005.





Reclassifications





Certain
      prior period amounts have been reclassified to conform to the current year
      presentation.





Basis
      of
      Consolidation




The
      consolidated interim financial statements include the accounts of Technology
      and
      its wholly owned subsidiary, ANTAO Ltd., a limited liability company formed
      under the laws of Russia (“ANTAO”). All material intercompany accounts and
      transactions have been eliminated in consolidation.





Business
      Activity





The
      Company develops, licenses and services software that enables the generation,
      manipulation, viewing and image-based searching of complex, multi-dimensional
      mathematical objects and information. Since Inception, the Company has operated
      in a development phase typical of a software company and has focused on
      developing technologies and products and securing intellectual property rights
      while developing relationships with potential customers. Corporate activities
      to
      date have included raising capital, strategic and business planning, completing
      the registration of the Company’s securities with the U. S. Securities and
      Exchange Commission and retaining executive management. The Company has minimal
      sales and no sales contracts and is considered to be in the development stage
      as
      of December 31, 2005.





Use
      of
      Estimates





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect the reported amounts of assets and
      liabilities and disclosures of contingent assets and liabilities as of the
      balance sheet date and the reported amounts of expenses for the period
      presented. Actual results could differ from those estimates.





7


Cash
      and
      Cash Equivalents





Cash
      and
      cash equivalents include highly liquid money market investments purchased with
      an original maturity of three months or less. At December 31, 2005, the Company
      had no cash equivalents. The Company maintains its cash in a bank deposit
      account, the balance of which, at times, may exceed federally insured limits.
      Accounts are guaranteed by the Federal Deposit Insurance Corporation
      (FDIC) up to $100,000. At December 31, 2005, the Company had no amounts in
      excess of FDIC insured limits.





Foreign
      Currency Transactions





All
      transactions of the Company are denominated in U.S. dollars. The Company paid
      Russian research, programming and administrative costs under a U.S. dollar
      denominated agreement. Consolidated general and administrative expenses include
      immaterial foreign exchange rate losses on Russian bank balances maintained
      by
      ANTAO. The Company has not engaged in foreign currency hedging activities.





Stock-Based
      Compensation





Statement
      of Financial Accounting Standards (“SFAS”) No. 123R, “Accounting for
      Stock-Based Compensation,” requires companies to record employee stock option
      compensation at fair value. The Company adopted SFAS 123R during the quarter
      ending March 31, 2005. No options were granted during the nine months ending
      December 31, 2005.





Software
      Development Costs





The
      Company accounts for software development costs in accordance with SFAS
      No. 86, “Accounting for the Costs of Computer Software to Be Sold, Leased
      or Otherwise Marketed.” Costs incurred to establish the technological
      feasibility of a computer software product are considered research and
      development costs and are expensed as incurred. When the technological
      feasibility of a software product has been established using the working model
      approach, development cost are capitalized. Capitalization of these costs ceases
      when the product is ready for production. The Company has expensed all software
      development costs since Inception.





Revenue
      Recognition





The
      Company expects to recognize revenues, net of sales returns and other
      allowances, from the licensing of products and from service revenues.





Product
      revenues will consist of revenues from end-user licenses (sometimes referred
      to
      as royalties) and fees for stand-alone software and technology under time-based
      or perpetual licenses. Service revenues will consist of fees from professional
      services, which will include fees for software development services, software
      maintenance contracts and customer training and consulting services.





The
      Company will recognize revenues in accordance with Statement of Position or
      “SOP” 97-2, “Software Revenue Recognition,” as amended, SOP 81-1, “Accounting
      for Performance of Construction-Type and Certain Production-Type Contracts,” and
      Staff Accounting Bulletin or “SAB” 104, “Revenue Recognition.” The Company will
      recognize revenues when persuasive evidence of an arrangement exists, delivery
      has occurred, the vendor’s fee is fixed or determinable, vendor-specific
      objective evidence exists for all undelivered elements of the arrangement and
      collection is determined to be probable.





Net
      Loss
      Per Share





Basic
      net
      loss per common share is computed by dividing net loss applicable to common
      stockholders by the weighted-average number of common shares outstanding during
      the period. Diluted net loss per common share is determined using the
      weighted-average number of common shares outstanding during the period, adjusted
      for the dilutive effect of common stock equivalents, consisting of shares
      issuable upon exercise of common stock options. In periods when losses are
      reported, the weighted-average number of common shares outstanding excludes
      common stock equivalents because their inclusion would be
      anti-dilutive.





8


On
      January 18, 2005, the Company completed a 95,000 for one stock split.
      Stockholders’ equity has been restated to give retroactive recognition to the
      stock split for all periods presented by reclassifying the par value of the
      additional shares arising from the split from paid-in-capital to common stock.
      All references in the financial statements and notes to number of shares and
      per
      share amounts reflect the stock split.





Advertising





Advertising
      expense, including direct mail and email advertising, was $0 and $73,804 for
      the
      three months and nine months ended December 31, 2005, respectively.





Fair
      Value of Financial Instruments





The
      Company’s financial instruments consist mainly of cash, short-term payables and
      borrowings under the notes payable. The Company believes that the carrying
      amounts approximate fair value, due to their short-term maturities and current
      interest rates.





Impairment
      of Long-Lived Assets





The
      Company reviews its long-lived assets for impairment whenever events or changes
      indicate that the carrying amount of an asset or group of assets may not be
      recoverable. No impairment losses were recorded during the period ended December
      31, 2005.





NOTE
      2.
      GOING CONCERN CONSIDERATIONS





The
      Company’s financial statements have been prepared on a going concern basis,
      which contemplates the realization of assets and the settlement of liabilities
      and commitments in the normal course of business. The Company is in the
      development stage and has had minimal revenues since Inception. Management
      recognizes that the Company must raise capital sufficient to pursue its business
      plans until such time as the Company can generate revenues and net cash flows
      in
      amounts necessary to enable it to continue in existence. The realization of
      assets and satisfaction of liabilities in the normal course of business is
      dependent upon the Company achieving these goals.





During
      September 2005, the Company implemented a change in its business strategy and
      took certain actions to reduce its overhead costs. The Company intends to
      maintain and support its existing ***nViz*** ***x*** visualization products, including continuing to market these products under
      a
      Reseller Agreement with a leading mathematical computational software developer,
      but the Company does not presently plan to introduce new versions of the product
      or upgrades unless and until sales for the current products increase
      significantly. Marketing efforts under this Reseller Agreement began in June
      2005. The Company has discontinued its development projects unrelated to ***nViz*** ***x*** .
      The
      Company has terminated its use of software development services previously
      provided to the Company by Splinex Outsourcing, Inc., a Russian outsourcing
      company, and significantly reduced its software development team in the United
      States. In addition, the Company has terminated or accepted resignations from
      certain executives and managers. The Company intends to explore alternative
      uses
      of its existing technology through licensing or other business development
      activities. The Company has borrowed funds from a related party, Ener1 Group,
      Inc., to pay certain ongoing expenses while it pursues such alternatives, which
      could include acquisitions of or joint ventures with companies that could
      benefit from certain of the Company’s core technologies. The Company does not
      anticipate receiving funding from Ener1 Group, Inc. sufficient to pay past
      due
      obligations including severance obligations until it has been able to implement
      its business development further.




9


On
      December 13, 2005, the Company signed a letter of intent to acquire EnerSoft,
      Inc. (“EnerSoft”), a privately held technology company that specializes in the
      development of video processing filters, signal and imaging processing and
      video
      compression technologies. Ener1 Group, Inc., a company affiliated with the
      Company by common ownership and common control, owns 95% of the equity of
      EnerSoft. EnerSoft is a development stage software company with no assets or
      revenues.




The
      letter of intent contemplates that the Company would issue 199,519,730 shares
      of
      common stock in a private placement as consideration for the outstanding stock
      of EnerSoft. Completion of the transaction is subject to satisfactory completion
      of due diligence, negotiation of definitive transaction agreements and receipt
      of necessary corporate and third party approvals, among other customary closing
      conditions.




In
      accordance with the funding provisions in the Predecessor’s operating agreement,
      certain members of the Predecessor contributed capital of $2,000,000 to the
      Predecessor. As of July 27, 2005, the Company had borrowed $2,500,000 under
      a
      $2,500,000 revolving loan agreement with a company that is affiliated with
      the
      Company through common ownership (the “Bzinfin Loan”). The Company borrowed an
      additional $50,000 from Bzinfin during September 2005, and the loan agreement
      was amended to include the additional borrowing under the same terms and
      conditions. In the three months ended December 31, 2005, the Company borrowed
      $252,000 from Ener1 Group, Inc. under a demand note.





Management
      believes that actions presently being taken, as described in the preceding
      paragraphs, provide the opportunity for the Company to continue as a going
      concern; however, there is no assurance this will occur.





NOTE
      3.
      SEGMENT INFORMATION





The
      Company’s sole reportable business segment is visual communication software
      products and services. The Company’s accounting policies for segments are the
      same as those described in the summary of significant accounting policies.





NOTE
      4.
      ACCRUED EXPENSES





Accrued
      expenses represent expenses that are owed at the end of the period that either
      have not been billed by the provider or are expenses that are estimated for
      services provided. Accrued expenses also include severance and other wage
      related expenses due to former employees. At December 31, 2005, accrued expenses
      consisted of the following:




Accrued
                  severance and employment costsdue
                  to former employees
              
              $
              604,638Accrued
                  outsourcing costs
              
              
              43,000Audit
              
              
              40,000Accrued
                  vacation
              
              
              10,301Miscellaneous
              
              
              33,429$
              731,367
 NOTE
      5.
      STOCKHOLDERS’ EQUITY





The
      Company has the authority to issue 300,000,000 shares of common stock, par
      value
      of $0.001 per share. Each holder of common stock is entitled to one vote for
      each share held. The Company has the authority to issue 150,000,000 shares
      of
      preferred stock, par value $0.001 per share, which may be divided into series
      with the designations, powers, preferences, and relative rights and any
      qualifications, limitations or restrictions as determined by the Company’s board
      of directors.





Prior
      to
      April 1, 2004, the Company operated through the Predecessor as a limited
      liability company. On April 1, 2004, the Predecessor contributed substantially
      all of its assets, liabilities and operations to Technology pursuant to a
      Contribution Agreement. Under SEC Staff Accounting Bulletin Topic 4 (B), the
      undistributed earnings (losses) of the limited liability company were
      treated as a constructive distribution to the owners followed by a contribution
      of the capital to the new C Corporation. On April, 1, 2004, the effective date
      of the Contribution Agreement, the Company reclassified the accumulated deficit
      to date of $822,847 to additional paid in capital.





10


During
      October 2005, a former employee forfeited 62,500 restricted shares of the
      Company's common stock. The Company has recorded the forfeited restricted stock
      as treasury stock.





NOTE
      6.
      RELATED PARTY TRANSACTIONS





On
      January 1, 2004 and February 1, 2004, the Company entered into
      consulting agreements with two members of the Predecessor, one of whom is also
      director of the Company. The consulting agreements engage the members to provide
      consulting services including providing advice regarding equity restructuring,
      business planning, strategic planning, and international licensing in exchange
      for $100,000 per year, or a monthly fee to each consultant of $8,333. General
      and administrative expenses include consulting fees under these agreements
      of
      $50,000 and $150,000 for the three and nine months ended December 31, 2005
      and
      $50,000 and $150,000 for the three months and nine months ended December 31,
      2004, respectively. Accounts payable include $150,666 owed under these
      agreements.





The
      Company shares personnel with Ener1, Inc. and Ener1 Group, Inc., entities
      affiliated with the Company by common ownership and through common control.  Accordingly,
      amounts have been allocated to and from the Company for the services of
      personnel and other expenses. The Company incurred rent expense of $15,806
      and
      $46,634 for its office space under a sublease with Ener1 Group, Inc. for the
      three months and nine months ended December 31, 2005 and $15,231 and $45,191
      for
      the three months and nine months ended December 31, 2004. Related parties
      reimburse the Company for the time spent by one of its employees for patent
      and
      research work; as a result, research and development expenses are net of
      reimbursements of $0 and $2,280 for the three months and nine months ended
      December 31, 2005; general and administrative expenses and research and
      development expenses are net of reimbursements of $0 and $7,320 for the three
      months ended December 31, 2004 and $17,160 and $39,960 for the nine months
      ended
      December 31, 2004, respectively. General and administrative expenses include
      legal expenses payable to Ener1 Group, Inc. for the services of an Ener1 Group
      employee who serves as the Company’s general counsel in the amounts of $1,500
      and $9,200 for the three months and nine months ended December 31, 2005 and
      $12,120 and $29,290 for the three months and nine months ended December 31,
      2004.





The
      Company worked with Russia-based scientists and programmers who were paid on
      the
      Company’s behalf under an agreement with a Russian consultant who handled
      administrative matters for the Company in Russia through July 2004. This
      consultant became an employee of the Company in July 2004. In March 2004,
      the consultant formed Splinex Outsourcing LLC to handle administrative and
      employment matters in connection with the Company’s Russian operations. In
      April 2004, a member of the Predecessor formed ANTAO to facilitate the
      payment of expenses to Splinex Outsourcing; ANTAO became a subsidiary of the
      Company on September 12, 2004. In September 2005, the Company terminated the
      development work provided by Splinex Outsourcing. During the nine months ending
      December 31, 2005, the Company paid $120,207 (unaudited) to Splinex Outsourcing
      LLC, of which $40,207 was paid through ANTAO and $80,000 was paid through Ener1
      Group, Inc. During the three and nine months ending December 31, 2004, the
      Company paid $72,000 and $228,000 (unaudited) to Splinex Outsourcing LLC of
      which $72,000 and $180,000 was paid through ANTAO and the remainder was paid
      through the Russian consultant.





NOTE
      7.
      DEBT DUE TO RELATED PARTIES





Effective
      April 1, 2004, a company that is affiliated with the Company through common
      ownership, entered into a revolving loan agreement with the Company under which
      the Company may borrow up to $2,500,000 in aggregate principal through
      July 31, 2005. Borrowings under the facility were contingent upon the
      consummation of the merger of the Company with Ener1 Acquisition Corp., which
      was effected as of January 18, 2005. Loans under this agreement bear interest
      at
      an annual rate of 5% and must be repaid two years from the date of the initial
      funding, which occurred on February 7, 2005. The Company borrowed $2,500,000
      under this facility as of July 27, 2005. The Company borrowed an additional
      $50,000 from Bzinfin during September 2005, and the loan agreement was amended
      to include the additional borrowing under the same terms and conditions.





11


During
      the three months ending December 31, 2005, the Company borrowed $252,000 from
      Ener1 Group, Inc. and borrowed an additional $81,000 through February 2, 2006.
      The loans are demand notes, and bear interest at an annual rate of 5% payable
      at
      maturity.





NOTE
      8.
      COMMITMENTS AND CONTINGENCIES





Foreign
      operations





The
      Company outsourced computer programming work to a company located in
      Ekaterinberg Russia through September 2005, and may engage in additional
      operations in Russia in the future. Operations in Russia are subject to
      significant risks not typically associated with companies in North America
      and
      Western Europe. These risks include, among others, political, economic
      and legal risks associated with doing business in Russia, limitations on foreign
      currency transactions, and risks associated with evolving Russian laws on
      issues including creditor rights and intellectual property. The Company’s
      ability to continue to develop products and earn revenues may be adversely
      affected by changes in the political, economic, legal and social conditions
      in
      Russia, and by changes in governmental policies with respect to laws and
      regulations, anti-inflationary measures, foreign currency transactions, and
      rates and methods of taxation, among other things.





12


Item
      2.
      Management’s Discussion and Analysis or Plan of Operation.





*This
        Quarterly* *Report on Form 10-QSB contains forward -looking statements within the meaning
        of
        Section 27A of the Securities Act of 1933, as amended, and Section 21E of
        the
        Securities Exchange Act of 1934, as amended. These statements relate to our
        expectations, hopes, intentions or strategies regarding future events or
        future
        financial performance.  Any statements contained in this report that are
        not statements of historical fact may be deemed forward-looking statements.
        In
        some cases, forward-looking statements can be identified by terminology such
        as
“may,” “will,” “should,” “expect,” “plan,” “anticipate,” “intend”, “believe,”
“estimate,” “predict,” “potential” or “continue,” or the negative of such terms
        or other comparable terminology. Forward-looking statements include but are
        not
        limited to statements regarding: our future business plans; the expected
        release
        dates and future sales of our products; development of other products; expected
        hiring levels; marketing plans; increases of selling, general and administrative
        costs and research and development spending; our product development strategy;
        financing requirement and capital raising plans  These statements are only
        predictions and are subject to a number of assumptions, risks and uncertainties
        that could cause actual results to differ materially from those expressed
        or
        implied in the forward-looking statements. The following important factors,
        in
        addition to those discussed in our filings with the Securities and Exchange
        Commission (the “Commission”) from time to time, and other unforeseen events or
        circumstances, could affect our future results and could cause those results
        or
        other outcomes to differ materially from those expressed or implied in our
        forward-looking statements: general economic conditions; competition; our
        ability to raise capital; our ability to control costs; changes within our
        industries; release of new and upgraded products and services by us or our
        competitors; development of our sales force; employee retention; our ability
        to
        protect our intellectual property; legal and regulatory issues; changes in
        accounting policies or practices; and successful adoption of our products
        and
        services.*




*All
        forward-looking statements* *are
        based on information available to us on the date* *of
        this filing* *,
        and
        we* *assume* *no
        obligation to update* ** *such* *statements.*


**


*The
        following discussion should be read in conjunction with our* *other
        filings with the Securities and Exchange Commission and the* *consolidated* *interim* *financial
        statements and related notes included in this* *Quarterly
        Report.*





**Overview**





Splinex
      has developed, and currently licenses and services software that enables the
      generation, manipulation, viewing and image-based searching of complex,
      multi-dimensional mathematical objects and information. We believe end-users
      of
      our software products, such as mathematicians, scientists, graphic designers
      or
      digital artists working on complex graphical three-dimensional problems, will
      experience greater productivity through improved interaction with, enhanced
      visual representation and faster manipulation of, and greater technical and
      artistic precision in representing, multi-dimensional mathematical objects
      and
      information.





Since
      inception, we have operated in a development phase typical of a software company
      and have focused on developing technologies and products and securing
      intellectual property rights while we develop relationships with potential
      customers and resellers. Our corporate activities to date have included raising
      capital, strategic and business planning, completing the registration of our
      securities with the Commission, and retaining executive management. We have
      minimal sales and no sales contracts and are considered to be in the development
      stage as of December 31, 2005.





We
      were
      organized under the laws of the State of Delaware in February 2004 to
      conduct the business and operations of Splinex, LLC, a Florida limited liability
      company (our “Predecessor”). Effective April 1, 2004, Splinex, LLC
      reorganized as a corporation and, as a result, contributed its assets,
      liabilities and operations to us under a contribution agreement. Our financial
      statements include the accounts of Splinex Technology Inc. and our Predecessor,
      and all material intercompany transactions have been eliminated. We began
      activity October 28, 2003 (inception).





13


On
      January 18, 2005, we merged with a subsidiary of Ener1, Inc., an affiliated
      company controlled by certain direct and indirect beneficial owners of the
      membership interests of our Predecessor (the “Merger”). We survived the Merger
      and issued 5,000,000 shares of our common stock to Ener1, Inc. in the Merger.
      Ener1, Inc. declared a dividend of the 5,000,000 shares that it received to
      its
      shareholders of record as of January 17, 2005 (the “Distribution”). The
      dividend was paid on January 24, 2005. Immediately after the Merger, and
      prior to the Distribution, Splinex, LLC and Ener1, Inc. owned 95% and 5%,
      respectively, of our then outstanding common stock. We registered the
      Distribution by Ener1, Inc. of our common stock on a registration statement
      on
      Form S-1 filed with the Commission. As a result of the Merger and the
      Distribution, we became a public reporting company subject to the information
      and reporting requirements of the Securities Exchange Act of 1934. The Merger
      and the Distribution are described further in our Registration Statement on
      Form
      S-1, filed with the Commission on December 27, 2004 (Registration No.
      Effective July 21, 2005, Splinex common stock began trading and was quoted
      on
      the Over the Counter (OTC) Bulletin Board under the symbol "SPLX.OB".





Several
      factors exist that raise significant doubt as to our ability to continue
      operating as a going concern. These factors include our history of net losses
      and the facts that our company is in the development stage and we have earned
      minimal revenues to date. We have no remaining funds available under our
      revolving loan agreement and are dependent upon a related party, Ener1 Group,
      Inc., to fund our operations. Our independent auditor’s report on our financial
      statements for the year ended March 31, 2005 contains an explanatory
      paragraph about our ability to continue as a going concern. In the absence
      of
      attaining profitable operations and achieving positive cash flow from operations
      or obtaining significant additional debt or equity financing, we will continue
      to have difficulty meeting current and long-term obligations.





During
      September 2005, we implemented a change in our business strategy and took
      certain actions to reduce our overhead costs. We intend to maintain and support
      our existing ***nViz*** ***x*** visualization products including continuing to market these products under
      a
      Reseller Agreement with a leading mathematical computational software developer,
      but we do not presently plan to introduce new versions of the product or
      upgrades unless and until sales for the current products increase significantly.
      We have discontinued our development projects unrelated to ***nViz*** ***x*** .
      We have
      terminated our use of software development services previously provided to
      us by
      Splinex Outsourcing, Inc., a Russian outsourcing company, and significantly
      reduced our software development team in the United States. In addition, we
      have
      terminated or accepted resignations from certain executives and managers. We
      intend to explore alternative uses of our existing technology through licensing
      or other business development activities. We have borrowed funds from a related
      party, Ener1 Group, Inc., to pay certain ongoing expenses while we pursue such
      alternatives, which could include acquisitions of, or joint ventures with,
      companies that could benefit from certain of our core technologies. We do not
      anticipate receiving funding from Ener1 Group, Inc. sufficient to pay past
      due
      obligations, including severance obligations, until we have been able to
      implement our business development further.





In
      accordance with the funding provisions in the Predecessor’s operating agreement,
      certain members of the Predecessor contributed capital of $2,000,000 to the
      Predecessor. As of July 27, 2005, we had borrowed $2,500,000 under a revolving
      loan agreement with Bzinfin, a company that is affiliated with us through common
      ownership. We borrowed an additional $50,000 from Bzinfin during September
      2005,
      and the loan agreement was amended to include the additional borrowing under
      the
      same terms and conditions. We borrowed $252,000 from Ener1 Group during the
      three months ending December 31, 2005, and an additional $81,000 through
      February 2, 2006. The loans are demand notes, and bear interest at an annual
      rate of 5%, payable at maturity.





Plan
      of
      Operation




During
      the period from inception on October 28, 2003 through October 1, 2004, our
      research and development activities were primarily directed towards developing
      core technologies and software libraries that could be used in various
      applications and market segments.




14


During
      the period from October 1, 2004 through August 2005, we have directed most
      of
      our software development activities to developing and releasing a commercial
      version of our software product called ***nViz*** ***x*** ,
      the
      first versions of which were designed for use with Mathematica and Maple, two
      third-party technical computing software programs published by Wolfram Research
      Inc. and Waterloo Maple, Inc., respectively. Mathematica and Maple are programs
      used for advanced mathematical functions and problem solving, such as numeric
      and symbolic computation plus interactive document creation. ***nViz*** ***x*** is an
      add-on (i.e., a product sold separately and used in connection with the
      technical computing software) software program that allows users to visualize
      sophisticated and complex multi-dimensional data and objects faster and with
      greater control and detail than is currently possible.





The
      first
      version of ***nViz*** ***x*** v1.0 for
      Mathematica was commercially released and made available for purchase in March
      2005. ***nViz*** ***x*** v1.5 for
      Maplesoft was commercially released and made available for purchase in June
      2005. In June 2005, we entered into a Reseller Agreement with Waterloo Maple
      Inc., the parent company of Maplesoft, the developer of Maple software. Under
      the Reseller Agreement, Maplesoft and Splinex agreed to conduct a number of
      joint marketing and sales initiatives. Additionally, Maplesoft agreed to promote ***nViz*** ***x*** v1.5 for
      Maple through its web site and other marketing activities directed to its
      customer base. We have not had significant sales of either product, and do
      not
      have sufficient funds to market the product to achieve higher sales. Our current
      marketing activities consist solely of the marketing efforts of our reseller
      and
      limited low cost marketing efforts through our web store.





Using
      our
      core software libraries, we have the capability to develop additional versions
      of n ***nViz*** ***x*** as
      visualization add-ons for other technical computing software products similar
      to
      Mathematica and Maplesoft and for spreadsheet products like Microsoft
      Excel.  However, due to low product sales, we intend to maintain and
      support our existing ***nViz*** ***x*** visualization products, but do not presently plan to introduce new versions
      of
      the product or upgrades unless and until sales of the current products increase
      significantly. We intend to explore alternative uses of our existing technology
      through licensing or other business development activities. We may pursue
      acquisitions of, or joint ventures with, companies that can benefit from our
      technology.





On
      December 13, 2005, we signed a letter of intent to acquire EnerSoft, Inc.
      (“EnerSoft”), a privately held technology company that specializes in the
      development of video processing filters, signal and imaging processing and
      video
      compression technologies. Ener1 Group, Inc., a company affiliated with our
      Company by common ownership and common control, owns 95% of the equity of
      EnerSoft. EnerSoft is a development stage software company with no assets or
      revenues.





The
      letter of intent contemplates that we would issue 199,519,730 shares of common
      stock in a private placement as consideration for the outstanding stock of
      EnerSoft. Completion of the transaction is subject to satisfactory completion
      of
      due diligence, negotiation of definitive transaction agreements and receipt
      of
      necessary corporate and third party approvals, among other customary closing
      conditions.





At
      December 31, 2005, we had cash of $3,522 and negative working capital of
      $1,606,183.  Through employee terminations, the termination of our use of
      software development services previously provided to us by Splinex Outsourcing,
      Inc., and implementation of other expense controls, we have reduced our monthly
      cash expenses to approximately $75,000. We are currently dependent upon funds
      advanced from Ener1 Group, Inc. to pay these ongoing expenses. We do not
      anticipate receiving funding sufficient to pay our past due obligations,
      including severance obligations, until we have been able to implement our
      business development plans further.





We
      cannot
      provide assurance you that we will be able to raise additional funds on terms
      favorable to us or at all. If we raise additional funds through the sale of
      equity or convertible debt securities, our current stockholders’ ownership
      percentage of our common stock will be reduced. In addition, these transactions
      may dilute the value of our common stock. We may have to issue securities that
      have rights, preferences and privileges senior to our common stock. The terms
      of
      any additional indebtedness may include restrictive financial and operating
      covenants that would limit our ability to compete and expand. Our failure to
      obtain any required future financing could materially and adversely affect
      our
      financial condition.





15


As
        of
        December 31, 2005, we have no
        material planned capital expenditures .





**Results
        of** **Operations** **for the** **Three
        Month Period Ended** **December 31, 2005**





We
      incurred a loss of $248,113, or $0.002 per share, for the three months ended
      December 31, 2005, compared to a loss of $901,610, or $0.009 per share in the
      prior year quarter. Weighted average shares outstanding were 100,466,466 and
      100,602,088 for the three and nine months ended December 31, 2005 and 95,000,000
      and 95,000,000 for the three and nine months ended December 31, 2004,
      respectively. Operations for the three and nine months ended December 31, 2004
      were primarily related to the development and commercial release of software
      products. Operations for the three and nine months ended December 31, 2005
      reflect the termination of a substantial part of our software development team
      and reduced administrative overhead costs and marketing expenditures due to
      limited funds available for operations.





Operating
      expenses of $214,890 for the three months ended December 31, 2005 included
      $5,448 for sales and marketing expenses, $164,092 for general and administrative
      expenses, and $45,350 for research and development costs. Operating expenses
      of
      $733,055 for the three months ended December 31, 2004 included $67,086 for
      sales
      and marketing expenses, $285,388 for general and administrative expenses and
      $380,581 for research and development costs. Costs incurred in connection with
      the Merger and registration of the Distribution were $167,643 for the three
      months ended December 31, 2004. Interest expenses increased to $34,130 for
      the
      three months ended December 31, 2005 from $936 in the three months ender
      December 31, 2004 due to borrowings under the Bzinfin loan and loans from Ener1
      Group. Interest under the Bzinfin loan is due at maturity in February
      2007.





Sales
      and
      marketing expenses for the three months ended December 31, 2004 consisted
      primarily of wages and benefits of $52,437 and web site development costs of
      $4,211.





General
      and administrative expenses for the three months ended December 31, 2005
      included wages and benefits of $41,747, consulting fees of $50,000 payable
      to a
      director, Dr. Novak and, a related party, Mike Zoi; legal expenses of
      $7,898, of which $1,500 was payable to Ener1 Group to reimburse Ener1 Group
      for
      the services of our general counsel, who is also an officer of Ener1 Group;
      audit fees of $6,140; insurance costs of $21,328; and rent of $15,806. General
      and administrative expenses for the three months ended December 31, 2004
      included wages and benefits of $108,998, consulting fees of $50,000 paid to
      a
      director, Dr. Novak and a related party, Mike Zoi; legal expenses of
      $12,175, of which $12,120 was payable to Ener1 Group to reimburse for the
      services of our general counsel; audit fees of $20,000; travel and related
      expenses of $29,864, insurance costs of $1,719; outsourced web site and computer
      servicing costs of $23,139 and rent of $15,231. Wages decreased for the three
      months ended December 31, 2005 due to the resignation of the chief executive
      officer in September 2005; travel expenses in fiscal 2005 were primarily to
      reimburse the chief executive officer for travel from his home during the first
      four months of his employment agreement; there were no travel expenses in the
      three months ended December 31, 2005; audit expenses were higher for the three
      months ended December 31, 2005 in fiscal 2005 as a result of the additional
      work
      for the registration statement filed during that quarter; and insurance costs
      increased for the three months ended December 31, 2005 because we obtained
      a
      directors and officers liability insurance policy that was not in force in
      the
      prior year.





Research
      and development expenses for the three months ended December 31, 2005 primarily
      consisted of $42,630 for wages and benefits paid to U.S. based programmers.
      Research and development expenses for the three months ended December 31, 2004
      included $164,215 for wages and benefits paid to U.S. based programmers; $79,000
      for wages and administrative costs of our Russian-based scientists and
      programmers, $53,997 paid to software consultants, and $64,594 for immigration
      and employee relocation costs. In September 2005, we terminated or accepted
      resignations from certain members of our U.S. development team and terminated
      the software development services of our Russian programmers.




16


**Results
      of Operations for the Nine Month Period Ended December 31, 2005**





We
      incurred a loss of $2,039,817, or $0.02 per share, for the nine months ended
      December 31, 2005 compared to $2,389,584, or $0.025 per share for the nine
      months ended December 31, 2004. Operating expenses of $1,951,372 for the nine
      months ended December 31, 2005 included $195,567 for sales and marketing
      expenses, $1,122,252 for general and administrative expenses, and $633,553
      for
      research and development costs. Operating expenses of $1,876,376 for the nine
      months ended December 31, 2004 included $185,021 for sales and marketing
      expenses, $867,129 for general and administrative expenses, and $824,226 for
      research and development costs. Costs incurred in connection with the Merger
      and
      registration of the Distribution were $512,320 for the nine months ended
      December 31, 2004. Interest expenses increased to $90,039 for the nine months
      ended December 31, 2005 from $936 in the nine months ended December 31, 2005
      due
      to borrowings under the Bzinfin loan and loans from Ener1 Group. Interest under
      the Bzinfin loan is due at maturity in February 2007.





Sales
      and
      marketing expenses for the nine months ended December 31, 2005 consisted
      primarily of wages and benefits of $96,064 and direct mail advertising expenses
      of $73,804. Sales and marketing expenses for the nine months ended December
      31,
      2004 consisted primarily of wages and benefits of $110,021, web site development
      costs of $27,440, marketing consultants of $27,028 and advertising costs $8,962.





General
      and administrative expenses for the nine months ended December 31, 2005 included
      severance expense of $404,960; wages and benefits of $235,711, consulting fees
      of $150,000 paid to a director, Dr. Novak, and Mike Zoi; legal expenses of
      $70,596, of which $9,200 was payable to Ener1 Group to reimburse Ener1 Group
      for
      the services of our general counsel; audit fees of $55,083; travel costs of
      $4,402; insurance costs of $63,343; and rent of $46,634. General and
      administrative expenses for the nine months ended December 31, 2004 included
      wages and benefits of $278,454, consulting fees of $150,000 paid to a director,
      Dr. Novak, and Mike Zoi; legal expenses of $40,187, of which $29,290 was
      payable to Ener1 Group to reimburse Ener1 Group for the services of our general
      counsel; executive recruiting fees of $75,015; audit fees of $40,000; travel
      of
      $64,626, insurance costs of $5,157; and rent of $45,192. Severance expenses
      relate to the resignation or termination of certain executives and managers
      and
      payments are due through December 2007. Wages decreased for the nine months
      ended December 31, 2005 due to the resignation of the chief executive officer
      in
      September 2005; travel expenses decreased for the nine months ended December
      31,
      2005 because travel expenses for the nine months ended December 31, 2004 were
      primarily to reimburse the chief executive officer for travel from his home
      during the first four months of his employment agreement; audit expenses
      increased as a result of the Securities Act registration of the Distribution;
      recruiting fees were expenses for the recruitment of the chief executive
      officer; and insurance expenses increased because we obtained a directors and
      officers liability insurance policy that was not in force in the prior
      year.





Research
      and development expenses for the nine months ended December 31, 2005 included
      $444,591 for wages and benefits paid to U.S. based programmers; $156,207 for
      wages and administrative costs of our Russian-based scientists and programmers
      and $20,570 paid to software consultants. Research and development expenses
      for
      the nine months ended December 31, 2004 included $357,588 for wages and benefits
      paid to U.S. based programmers; $223,000 for wages and administrative costs
      of
      our Russian-based scientists and programmers; $146,088 paid to software
      consultants; and $76,500 for immigration and employee relocation costs. In
      September 2005, we terminated or accepted resignations from certain members
      of
      our U.S. development team and terminated the software development services
      of
      our Russian programmers. Wages increased due to the hiring of a director of
      programming in January 2005 and five programmers who commenced work during
      July
      2004; payments to the Russian outsourcing company increased due to estimated
      termination costs in September 2005.




Related
      parties reimburse us for the time spent by one of our employees for patent
      and
      research work; as a result, research and development expenses are net of
      reimbursements of $0 and $2,280 for the three months and nine months ended
      December 31, 2005; general and administrative expenses and research and
      development expenses are net of reimbursements of $0 and $7,320 for the three
      months ended December 31, 2004 and $17,160 and $39,960 for the nine months
      ended
      December 31, 2004, respectively





17


**Liquidity
      and capital resources**





At
      December 31, 2005, we had negative working capital of $1,606,183 and cash of
      $3,522. and we have no further borrowing availability under the Bzinfin Loan.





Several
      factors exist that raise significant doubt as to our ability to continue
      operating as a going concern. These factors include our history of net losses
      and the facts that our company is in the development stage and we have earned
      minimal revenues to date. We have no remaining funds available under our
      revolving loan agreement and are dependent upon Ener1 Group, Inc. to fund our
      operations. Our independent auditors’ report on our financial statements for the
      year ended March 31, 2005 contains an explanatory paragraph about our
      ability to continue as a going concern. In the absence of attaining profitable
      operations and achieving positive cash flow from operations or obtaining
      significant additional debt or equity financing, we will continue to have
      difficulty meeting current and long-term obligations.





During
      September 2005, we implemented a change in our business strategy and took
      certain actions to reduce overhead costs. We intend to maintain and support
      our
      existing ***nViz*** ***x*** visualization products, including continuing our marketing efforts under a
      Reseller Agreement with a leading mathematical computational software developer,
      but we do not presently plan to introduce new versions of the product or
      upgrades unless and until sales of the current products increase significantly.
      We have terminated our use of software development services previously provided
      by Splinex Outsourcing, Inc., a Russian outsourcing company, and significantly
      reduced our software development team in the United States. In addition, we
      have
      terminated or accepted resignations from certain executives and managers. We
      intend to explore alternative uses of our existing technology through licensing
      or other business development activities. We may also pursue acquisitions of,
      or
      joint ventures with, companies that could benefit from our core technologies.
      We
      do not anticipate receiving funding from Ener1 Group sufficient to pay past
      due
      obligations, including severance obligations, until we have implemented our
      business development plans further.





In
      accordance with the funding provisions in the Predecessor’s operating agreement,
      certain members of the Predecessor contributed capital of $2,000,000 to the
      Predecessor. As of July 27, 2005, we had borrowed $2,500,000 under the Bzinfin
      loan. We borrowed an additional $50,000 from Bzinfin during September 2005,
      and
      the loan agreement was amended to include the additional borrowing under the
      same terms and conditions. We borrowed $252,000 from Ener1 Group during the
      three months ending December 31, 2005, and an additional $81,000 through
      February 2, 2006. The loans are demand notes, and bear interest at an annual
      rate of 5% payable at maturity.





In
      the
      absence of attaining profitable operations and achieving positive cash flows
      from operations or obtaining significant additional debt or equity financing,
      we
      will continue to have difficulty meeting current and long-term obligations.





Prior
      to
      April 1, 2004, we operated through our Predecessor as a limited liability
      company. On April 1, 2004, our Predecessor contributed all of its assets,
      liabilities and operations to us. Under SEC Staff Accounting Bulletin Topic
      4
      (B), the undistributed earnings (losses) of our Predecessor were treated as
      a constructive distribution to the members of our Predecessor followed by a
      capital contribution to us. On April, 1, 2004, the effective date of the
      contribution, we reclassified the accumulated deficit to date of $822,847 to
      additional paid in capital.





We
      do not
      have material exposure to market risks associated with changes in interest
      rates
      related to cash equivalent securities held at December 31, 2005.





**Off-balance
      sheet arrangements**





At
      December 31, 2005, we did not have any off-balance sheet arrangements, as
      defined in item 303(c)(2) of Regulation S-B.





18


Item
      3.
      Controls and Procedures.





Our
        disclosure controls and procedures are designed to provide reasonable assurance
        that information required to be disclosed in our reports filed or
        submitted under
        the Securities Exchange Act of 1934 is
        recorded, processed, summarized and reported within
        the time periods specified in the SEC’s
        rules and forms, and that such information is
        accumulated and communicated to our
        management, including our chief executive officer and chief financial
        officer ,
        as
        appropriate, to allow for timely
        decisions regarding required disclosure .
        In
        designing and evaluating the disclosure controls and procedures, management
        recognized that any controls and procedures, no matter how well designed
        and
        operated, can provide only reasonable assurance of achieving the desired
        control
        objectives, and management is required to apply its judgment in evaluating
        the
        cost-benefit relationship of possible controls and procedures.





As
        of
        December 31, 2005, we
        carried out an evaluation , under
        the supervision and with the participation of our management,
        including our president and chief financial officer, of the
        effectiveness of the design and operation of our disclosure controls and
        procedures. Based on
        the foregoing, our president and
        chief financial officer
        concluded that our disclosure controls and procedures were
        effective and were operating at the reasonable assurance level.


During
      the quarter ended December 31, 2005, there were no changes in internal controls
      over financial reporting that have materially affected, or are reasonably likely
      to materially affect, our internal control over financial
      reporting.





PART
      II —
OTHER INFORMATION





Item
      1.
      Legal proceedings





From
      time
      to time, we may be involved in litigation relating to claims arising out of
      our
      intellectual property and operations. We are not currently a party to any such
      proceedings the outcome of which would have a material affect on our company.





Item
      5.
      Other Information





On
      January 27, 2006, Gerard A. Herlihy, our President and Chief Financial Officer,
      was appointed as the Chief Financial Officer of Ener1, Inc. (“Ener1”). Mr.
      Herlihy will devote substantially all of his time to his role at Ener1. Mr.
      Herlihy will also continue to serve as our President and Chief Financial
      Officer. Ener1 is an affiliate of our company that is controlled by certain
      direct and indirect beneficial owners of Ener1 Group, Inc., the majority
      shareholder of Ener1. Ener1 will pay $190,000, or approximately 76% of Mr.
      Herlihy’s aggregate salary from the two companies, and we will pay
      $60,000.








19


Item
      6.
      Exhibits





Exhibit
            
            DescriptionNumber2.1
            
            Agreement
                and Plan of Merger among Ener1 Acquisition Corp., Splinex and Ener1,
                Inc.,
                dated as of June 9, 2004, incorporated herein by reference to Exhibit
                2.1 to Splinex’s Registration Statement on Form S-1 filed with the
                Commission on June 24, 2004 (Registration No.
                333-116817)2.2
            
            First
                Amendment to Agreement and Plan of Merger among Ener1 Acquisition
                Corp.,
                Splinex and Ener1, Inc., dated as of October 13, 2004, incorporated
                herein by reference to Exhibit 2.2 to Splinex’s Registration Statement on
                Form S-1 filed with the Commission on October 15, 2004 (Registration
                No.
                333-116817)2.3
            
            Second
                Amendment to Agreement and Plan of Merger among Ener1 Acquisition
                Corp.,
                Splinex and Ener1, Inc., dated as of December 23, 2004, incorporated
                herein by reference to Exhibit 2.3 to Splinex’s Registration Statement on
                Form S-1 filed with the Commission on December 27, 2004 (Registration
                No.
                333-116817)3.1
            
            Certificate
                of Incorporation of Splinex, incorporated herein by reference to
                Exhibit
                3.1 to Splinex’s Registration Statement on Form S-1 filed with the
                Commission on June 24, 2004 (Registration No.
                333-116817)3.2
            
            Certificate
                of Merger of Splinex, incorporated herein by reference to Exhibit
                3.2 to
                Splinex’s Registration Statement on Form S-1 filed with the Commission on
                December 27, 2004 (Registration No. 333-116817)3.3
            
            Bylaws
                of Splinex, incorporated herein by reference to Exhibit 3.3 to Splinex’s
                Registration Statement on Form S-1 filed with the Commission on June
                24,
                2004 (Registration No. 333-116817)31.1
            
            Certification
                of Principal Executive Officer and Principal Financial Officer pursuant
                to
                Section 302 of the Sarbanes-Oxley Act of 200232.1
            
            Certification
                of Principal Executive Officer pursuant to 18 U.S.C. Sec. 1350, as
                adopted
                pursuant to Section 906 of the Sarbanes-Oxley Act of
                2002





20


**SIGNATURES**





In
      accordance with the requirements of the Exchange Act, the registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly
      authorized.





Splinex
                Technology Inc.RegistrantDate:
                February 21, 2006
            
            By:
            
            /s/
                Gerard A. HerlihyName:
                Gerard A. HerlihyTitle:
                President and Chief Financial Officer