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 June 30, 2006





⍷ o TRANSITION
      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.)




500
      W.
      Cypress Creek Road Suite 100


Fort
      Lauderdale, FL 33309


(Address
      of principal executive offices)





(954)
      556-4020


(Issuer’s
      telephone number)





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




Former
        address: Splinex
        Technology Inc.
 550
        West
        Cypress Creek Road-Suite 410
 Ft.
        Lauderdale, Florida, 33309




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 xNo o




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act.) Yes o 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 August 17, 2006, the number of shares
      outstanding of the registrant’s common stock was 100,757,770
      shares.





Transitional
      Small Business Disclosure Format (Check one): Yes o No x








**SPLINEX
      TECHNOLOGY INC.**


**Form
      10-QSB**


**For
      the Quarter Ended June 30, 2006**


**INDEX**





PageNo.PART
                I — FINANCIAL INFORMATIONItem
                1.
            Financial
                StatementsCONDENSED
                CONSOLIDATED UNAUDITED BALANCE SHEETS - AS OF JUNE 30, 2006 AND MARCH
                31,
                2006
            3CONDENSED
                CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS - FOR THE THREE MONTHS
                ENDED JUNE 30, 2006 AND 2005 AND FOR THE PERIOD FROM INCEPTION (OCTOBER
                28, 2003) THROUGH JUNE 30, 2006
            4CONDENSED
                CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS - FOR THE THREE MONTHS
                ENDED JUNE 30, 2006 AND 2005 AND FOR THE PERIOD FROM INCEPTION (OCTOBER
                28, 2003) THROUGH JUNE 30, 2006
            5Notes
                to Condensed Consolidated Financial Statements
            6Item
                2.
            Management’s
                Discussion and Analysis or Plan of Operation.
            12Item
                3.
            Controls
                and Procedures
            17PART
                II — OTHER INFORMATIONItem
                1.
            Legal
                Proceedings
            18Item
                6.
            Exhibits
            19Signatures
            20


2


PART
      I —
FINANCIAL INFORMATION





Item
      1.
      Financial Statements.





SPLINEX
      TECHNOLOGY INC.


(A
      DEVELOPMENT STAGE COMPANY)


CONDENSED
      CONSOLIDATED UNAUDITED BALANCE SHEETS


June
                  30, 2006
              
              
              March
                  31, 2006**ASSETS**Current
                  assetsCash
              
              $
              4,253
              
              $
              9,458Prepaid
                  expenses and other
              
              
              26,284
              
              
              38,358Loans
                  and advances to employees - current portion
              
              
              -
              
              
              831Total
                  current assets
              
              
              30,537
              
              
              48,647Property
                  and equipment, net
              
              
              5,058
              
              
              7,340Accounting
                  software license
              
              
              -
              
              
              20,192Other
                  assets
              
              
              9,881
              
              
              9,881Total
                  assets
              
              $
              45,476
              
              $
              86,060**LIABILITIES
                  AND STOCKHOLDERS' DEFICIENCY IN ASSETS**Current
                  liabilitiesDemand
                  note payable and accrued interest due to related party - Ener1
                  Group
              
              
              536,501
              
              
              435,540Note
                  payable and accrued interest due to related party -
                  Bzinfin
              
              
              2,709,582
              
              
              2,677,707Accounts
                  payable
              
              
              616,007
              
              
              563,006Accrued
                  expenses
              
              
              673,021
              
              
              683,093Due
                  to related parties
              
              
              138,262
              
              
              138,262Total
                  current liabilities
              
              
              4,673,373
              
              
              4,497,608**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 100,757,770 shares issuedand
                  outstanding)
              
              
              100,758
              
              
              100,758Treasury
                  stock, at cost; 250,000 shares
              
              
              (62,500
              )
              
              (62,500
              )Paid
                  in capital
              
              
              1,109,712
              
              
              1,109,712Deficit
                  accumulated during the development stage
              
              
              (5,775,867
              )
              
              (5,559,518
              )Total
                  stockholders' deficiency in assets
              
              
              (4,627,897
              )
              
              (4,411,548
              )Total
                  liabilities and stockholders' deficiency in assets
              
              $
              45,476
              
              $
              86,060





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
              
              2003)Ended
              
              Ended
              
              ThroughJune
                  30, 2006
              
              June
                  30, 2005
              
              June
                  30, 2006Net
                  sales
              
              $
              -
              
              $
              70
              
              $
              2,020Operating
                  ExpensesSales
                  and marketing
              
              
              -
              
              
              140,168
              
              
              561,296General
                  and administrative
              
              
              154,348
              
              
              269,499
              
              
              3,340,565Research
                  and development
              
              
              23,289
              
              
              301,189
              
              
              2,007,805Total
                  operating expenses
              
              
              177,637
              
              
              710,856
              
              
              5,909,666Costs
                  of merger and registration
              
              
              -
              
              
              -
              
              
              512,321Total
                  expenses
              
              
              177,637
              
              
              710,856
              
              
              6,421,987Loss
                  from operations
              
              
              (177,637
              )
              
              (710,786
              )
              
              (6,419,967
              )Interest
                  expense, net
              
              
              (38,712
              )
              
              (25,188
              )
              
              (178,747
              )Loss
                  before income taxes
              
              
              (216,349
              )
              
              (735,974
              )
              
              (6,598,714
              )Income
                  taxes
              
              
              -
              
              
              -
              
              
              -Net
                  loss
              
              $
              (216,349
              )
              $
              (735,974
              )
              $
              (6,598,714
              )Net
                  loss per basic and diluted share
              
              $
              (0.00
              )
              $
              (0.01
              )Weighted
                  average shares outstanding basic and diluted
              
              
              100,757,770
              
              
              100,670,270





See
      accompanying notes.


4


SPLINEX
      TECHNOLOGY INC.


(A
      DEVELOPMENT STAGE COMPANY)


CONDENSED
      CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS


CumulativeFrom
                  Inception(October
                  28,Three
                  Months
              
              Three
                  Months
              
              2003)Ended
              
              Ended
              
              ThroughJune
                  30, 2006
              
              June
                  30, 2005
              
              June
                  30, 2006Cash
                  flows from operating activities:Net
                  loss
              
              $
              (216,349
              )
              $
              (735,974
              )
              $
              (6,598,714
              )Adjustments
                  to reconcile net loss to netcash
                  used in operating activities:Depreciation
              
              
              2,282
              
              
              6,616
              
              
              66,759Executive
                  compensation and other expensespaid
                  with common stock
              
              
              -
              
              
              -
              
              
              32,179Non
                  cash interest expense
              
              
              37,836
              
              
              25,119
              
              
              172,083Changes
                  in operating assets and liabilities:Prepaid
                  expenses and other
              
              
              32,266
              
              
              306
              
              
              (26,284
              )Due
                  to related parties
              
              
              -
              
              
              (27,034
              )
              
              138,261Other
                  assets
              
              
              -
              
              
              -
              
              
              (9,881
              )Accounts
                  payable
              
              
              53,001
              
              
              (45,644
              )
              
              616,008Accrued
                  expenses
              
              
              (10,072
              )
              
              54,455
              
              
              619,271Total
                  adjustments
              
              
              115,313
              
              
              13,818
              
              
              1,608,396Net
                  cash used in operating activities
              
              
              (101,036
              )
              
              (722,156
              )
              
              (4,990,318
              )Cash
                  flows from investing activities:Purchase
                  of equipment
              
              
              -
              
              
              -
              
              
              (79,429
              )Employee
                  loans and advances, net
              
              
              831
              
              
              3,698
              
              
              -Net
                  cash used in investing activities
              
              
              831
              
              
              3,698
              
              
              (79,429
              )Cash
                  flows from financing activities:Notes
                  payable related parties
              
              
              95,000
              
              
              611,243
              
              
              3,074,000Contributed
                  capital from equity investors
              
              
              -
              
              
              -
              
              
              2,000,000Net
                  cash provided by financing activities
              
              
              95,000
              
              
              611,243
              
              
              5,074,000Net
                  (decrease) increase in cash
              
              
              (5,205
              )
              
              (107,215
              )
              
              4,253Cash
                  at beginning of period
              
              
              9,458
              
              
              256,347
              
              
              -Cash
                  at end of period
              
              $
              4,253
              
              $
              149,132
              
              $
              4,253




See
      accompanying notes.


5


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, 2006. Operating results for
      the three months ended June 30, 2006 are not necessarily indicative of the
      results that may be expected for the year ending March 31, 2007. 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, 2006 included in the Company’s Form 10-KSB filed with the Securities
      and Exchange Commission on July 14, 2006.





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 June 30, 2006.





The
      Company has no significant revenues to date. Since its Inception, the Company
      has been dependent upon the receipt of capital investment or other financing
      to
      fund its continuing activities. In addition to the normal risks associated
      with
      a new business venture, there can be no assurance that the Company’s
      product will be a commercial success. Further, the Company is
      dependent upon certain related parties to provide continued funding and capital
      resources.


6




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.





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 June 30, 2006, 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 June 30, 2006, 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 or exercised during the three
      months ending June 30, 2006. At June 30, 2006, the Company has 800,000 options
      outstanding under its plan of which 400,000 options are vested, with an exercise
      price of $0.10 per share and with a remaining contractual term of 8 1/2
      years.





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’s revenues, net of sales returns and other allowances, are from the
      licensing of products. The Company recognizes 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.


7





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
      400,000 shares of common stock equivalents because their inclusion would be
      anti-dilutive.





Advertising





Advertising
      expense, including direct mail and email advertising, was $0 and $71,853 for
      the
      three months ended June 30, 2006 and 2005, respectively, and $190,739 from
      Inception through June 30, 2006.





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. An impairment loss of $20,000 was recorded during the period ended
      June 30, 2006 related to accounting software licenses no longer in
      use.





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 fund start up,
      development and marketing activities until such time as it 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. Management’s
      plans include continuing efforts to develop the Company’s first commercial
      product, borrowing funds under the revolving loan agreement described below,
      and
      raising additional capital.





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. From October 2005 through June 30, 2006, the Company borrowed
      $524,000 from Ener1 Group, Inc. under a demand note.





Since
      September 2005, the Company has implemented a change in its business strategy
      and taken certain actions to reduce its overhead costs. The Company is providing
      minimal maintenance and support of its existing ***nViz*** ***x*** visualization products, and does not presently plan to introduce new versions
      of
      the product. The Company has discontinued its development projects unrelated
      to ***nViz*** ***x*** .
      The
      Company has terminated its use of outsourced software development services
      previously provided to the Company by a Russian outsourcing company, and terminatedits software development team in the United States. In addition, the
      Company has terminated or accepted resignations from its executives and
      managers. The Company has borrowed funds from a related party, Ener1 Group,
      Inc., to pay certain ongoing expenses while it pursues alternative strategies,
      which could include merging 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.


8





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 June 30, 2006 and March 31, 2006,
      accrued expenses consisted of the following:




**June
                  30, 2006**
              
              **March
                  31, 2006**Accrued
                  severance and termination obligations
              
              $
              532,934
              
              $
              561,111Accrued
                  Russian programming closing costs
              
              
              43,000
              
              
              43,000Audit
              
              
              40,000
              
              
              40,000Accrued
                  vacation and wages
              
              
              29,660
              
              
              11,555Miscellaneous
              
              
              27,427
              
              
              27,427$
              673,021
              
              $
              683,093




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.





During
      October 2005, a former employee forfeited 250,000 restricted shares of the
      Company's common stock. The Company has recorded the forfeited restricted stock
      as treasury stock at $62,500 based upon the closing price of the common stock
      on
      the date of forfeiture.





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 for the three months ended June 30, 2006 and 2005, respectively.
      Accounts payable include $225,666 owed under these agreements.





The
      Company shared 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 $10,486
      and
      $15,414 for its office space under a sublease with Ener1 Group, Inc. for the
      three months ended June 30, 2006 and 2005, respectively. **** In
      the
      period ended March 31, 2006 (“fiscal 2006”), related parties reimbursed the
      Company for the time spent by one of its employees for patent and research
      work
      in the amount of $1,200 for the three months ended June 30, 2005. 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 amount of $4,400 for the three months ended June 30,
      2005.


9





During
      fiscal 2006, the Company worked with Russia-based scientists and programmers
      who
      were employed by a Russian outsourcing company. During the three months
      ended June 30, 2005, the Company paid $64,207 (unaudited) of outsourcing
      expenses through ANTAO.





Effective
      February 1, 2006, the Company’s President, Mr. Herlihy, was appointed to the
      position as Chief Financial Officer of Ener1, Inc. in addition to his continuing
      role at Splinex. Splinex is paying $60,000 of Mr. Herlihy’s $250,000 annual
      salary as Chief Financial Officer of Ener1, and Ener1 is paying $190,000 of
      Mr.
      Herlihy’s salary. Mr. Herlihy is dedicating substantially all of his time to
      Ener1, except for the time necessary to attend to the administrative and
      financial matters of Splinex.




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 borrowed $2,550,000 in aggregate principal through March 31, 2006.
      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.





At
      June
      30, 2006, the Company had borrowed $524,000 from Ener1 Group under a demand
      note
      bearing annual interest of 5% to fund working capital needs.





NOTE
      8.
      COMMITMENTS AND CONTINGENCIES





***Foreign
      subsidiary***





The
      Company has outsourced computer programming to a company located in Ekaterinberg
      Russia. The Company may engage in outsourcing in Russia again in the
      future. The outsourcing company’s 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 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.




***Lease
      Commitments***




Effective
      April 1, 2004, the Company assumed the rights and obligations under a
      sublease agreement for its office facility that the Predecessor entered into
      in
      October 2003. The sublease agreement expires on February 28,
      2008. Splinex vacated the space and Ener1 Group has sublet the space
      to a new tenant on June 1, 2006.




10


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
      develops, 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 March 31, 2006.





We
      began
      activity October 28, 2003 (Inception). Effective April 1, 2004, our
      Predecessor reorganized as a corporation and, as a result, contributed its
      assets, liabilities and operations to us. Our financial statements include
      the
      accounts of Splinex Technology Inc. and our Predecessor, and all material
      intercompany transactions have been eliminated.





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 fund start up,
      development and marketing activities until such time as it 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. Management’s
      plans include continuing efforts to develop the Company’s first commercial
      product, borrowing funds under the revolving loan agreement described below,
      and
      raising additional capital.


11





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. From October 2005 through June 30, 2006, the Company borrowed
      $524,000 from Ener1 Group, Inc. under a demand note.





During
        September 2005, the Company implemented a change in its business strategy
        and
        took certain actions to reduce its overhead costs. The Company is providing
        minimal maintenance and support of its existing ***nViz*** ***x*** visualization products, and does not presently plan to introduce new versions
        of
        the product. 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 a Russian outsourcing company and terminated its
        software development team in the United States. In addition, the Company
        has
        terminated or accepted resignations from its executives and managers. The
        Company has borrowed funds from a related party, Ener1 Group, Inc., to pay
        certain ongoing expenses while it pursues alternative strategies,
        which could include merging 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.


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.




**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.




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
      availability of the product for purchase at our internet web store.





Using
      our
      core software libraries, we have the capability to develop additional versions
      of *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 make available for
      purchase 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 may 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.


12




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 Company discontinued further due diligence activities and
      negotiations related to EnerSoft in May 2006 and no longer plan to pursue this
      acquisition.





At
      June
      30, 2006, we had cash of $4,253 and negative working capital of $4,642,836.
       Through employee terminations, the termination of outsourced software
      development services and implementation of other expense controls, we have
      reduced our monthly cash expenses to approximately $50,000. 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 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.





As
      of
      June 30, 2006, we have no material planned capital expenditures.





**Results
      of Operations for the Three Month Period Ended June 30, 2006**





We
      incurred a loss of $216,349, or $(0.00) per share, for the three months ended
      June 30, 2006, compared to a loss of $735,974, or $(0.01) per share in the
      prior
      year quarter. Weighted average shares outstanding were 100,757,770 and
      100,670,270 for the three months ended June 30, 2006 and 2005, respectively.
      Operations for the three ended June 30, 2005 were primarily related to the
      development and commercial release of software products. Operations for the
      three ended June 30, 2006 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 $177,637 for the three months ended June 30, 2006 included $154,348
      for general and administrative expenses, and $23,289 for research and
      development costs. Operating expenses of $710,856 for the three months ended
      June 30, 2005 included $140,168 for sales and marketing expenses, $269,499
      for
      general and administrative expenses and $301,189 for research and development
      costs. Interest expenses increased to $38,712 for the three months ended June
      30, 2006 from $25,188 in the three months ender June 30, 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 three months ended June 30, 2005 consisted primarily
      of wages and benefits of $56,685 and advertising and promotion expense of
      $71,853.





General
      and administrative expenses for the three months ended June 30, 2006 included
      wages and benefits of $16,732, consulting fees of $50,000 payable to a director,
      Dr. Novak and, a related party, Mike Zoi; audit fees of $17,000; insurance
      costs of $21,527; $32,016 of software expense related to licenses no longer
      used
      in operations, and rent of $10,486. General and administrative expenses for
      the
      three months ended June 30, 2005 included wages and benefits of $104,072,
      consulting fees of $50,000 paid Dr. Novak and Mike Zoi; legal expenses of
      $36,928, of which $4,040 was payable to Ener1 Group to reimburse for the
      services of our general counsel; insurance costs of $20,687; audit expense
      of
      $18,097; and rent of $15,414.





Research
      and development expenses for the three months ended June 30, 2006 were for
      wages
      and benefits paid to a U.S. based programmer. Research and development expenses
      for the three months ended June 30, 2005 included $205,606 for wages and
      benefits paid to U.S. based programmers; $72,000 for wages and administrative
      costs of our Russian-based scientists and programmers, and $12,450 paid to
      software consultants,. In September 2005, we terminated or accepted resignations
      from substantially all of our U.S. development team and terminated the software
      development services of our Russian programmers.




13




**Liquidity
      and capital resources**





At
      June
      30, 2006, we had a working capital deficit of $4,642,836 and cash of $4,253,
      and
      we have no further borrowing availability under the Bzinfin Loan. Approximately
      $3,600,000 of the current liabilities are due to related parties, and the
      remainder is due substantially to vendors and former employees under severance
      or other obligations, of which certain amounts have not been timely
      paid.





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, 2006 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, the Company implemented a change in its business strategy and
      took certain actions to reduce its overhead costs. The Company is providing
      minimal maintenance and support of its existing ***nViz*** ***x*** visualization products, and does not presently plan to introduce new versions
      of
      the product. 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 a Russian outsourcing company, and terminated its
      software development team in the United States. In addition, the Company has
      terminated or accepted resignations from its executives and managers. The
      Company has borrowed funds from a related party, Ener1 Group, Inc., to pay
      certain ongoing expenses while it pursues alternative strategies,
      which could include merging 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.





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 $429,000 from Ener1 Group during fiscal
      2006, and an additional $95,000 during the three months ended June 30, 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.





We
      do not
      have material exposure to market risks associated with changes in interest
      rates
      related to cash equivalent securities held at June 30, 2006.





**Off-balance
      sheet arrangements**





At
      June
      30, 2006, we did not have any off-balance sheet arrangements, as defined in
      item
      303(c)(2) of Regulation S-B.





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.


14





As
      of
      June 30, 2006, 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 June 30, 2006, 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.





15


Item
      6.
      Exhibits





ExhibitNumber
            
            Description2.1
            
            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




16


**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:
                August 21, 2006
            
            By:
            
            /s/
                Gerard A. HerlihyName:
                Gerard A. HerlihyTitle:
                President and Chief Financial Officer




17