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 September 30, 2005
  
 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.
 
  **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
o
        No x
  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 December 1, 2005, the number of shares
        outstanding of the registrant’s common stock was 100,670,270
        shares.
 
 Transitional
        Small Business Disclosure Format (Check one): Yes o No x
 
  **SPLINEX
        TECHNOLOGY INC.**
 **Form
        10-QSB**
 **For
        the Quarter Ended September 30, 2005**
 **INDEX**
  PageNo.PART
                      I — FINANCIAL INFORMATIONItem
                      1.
                  Financial
                      StatementsCONDENSED
                      CONSOLIDATED UNAUDITED BALANCE SHEET - AS OF SEPTEMBER 30,
                      2005 AND MARCH
                      31, 2005
                  3CONDENSED
                      CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS - FOR THE THREE
                      MONTHS AND
                      SIX MONTHS ENDED SEPTEMBER 30, 2005 AND 2004 AND FOR THE PERIOD
                      FROM
                      INCEPTION (OCTOBER 28, 2003) THROUGH SEPTEMBER 30, 2005
                  4CONDENSED
                      CONSOLIDATED UNAUDITED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIENCY
                      IN ASSETS - PERIOD FROM INCEPTION (OCTOBER 28, 2003) THROUGH
                      SEPTEMBER 30,
                      2005
                  5CONDENSED
                      CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS - FOR THE SIX
                      MONTHS ENDED
                      SEPTEMBER 30, 2005 AND 2004 AND FOR THE PERIOD FROM INCEPTION
                      (OCTOBER 28,
                      2003) THROUGH SEPTEMBER 30, 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
  September
                      30, 2005
                  
                  March
                      31, 2005**ASSETS**Current
                      assetsCash
                  
                  $
                  8,804
                  
                  $
                  256,347Prepaid
                      expenses and other
                  
                  
                  42,751
                  
                  
                  76,119Loans
                      and advances to employees - current portion
                  
                  
                  16,224
                  
                  
                  13,834Total
                      current assets
                  
                  
                  67,779
                  
                  
                  346,300Property
                      and equipment, net
                  
                  
                  29,920
                  
                  
                  49,862Accounting
                      software license
                  
                  
                  26,921
                  
                  
                  37,000Other
                      assets
                  
                  
                  9,881
                  
                  
                  9,881Loans
                      to employees - long term portion
                  
                  
                  —
                  
                  
                  9,875Total
                      assets
                  
                  $
                  134,501
                  
                  $
                  452,918**LIABILITIES
                      AND STOCKHOLDERS' DEFICIENCY IN ASSETS**Current
                      liabilitiesAccounts
                      payable
                  
                  
                  470,948
                  
                  
                  434,967Accrued
                      expenses
                  
                  
                  782,893
                  
                  
                  221,572Due
                      to related parties
                  
                  
                  135,502
                  
                  
                  106,760Other
                      current liabilities
                  
                  
                  17,430
                  
                  
                  75,849Total
                      current liabilities
                  
                  
                  1,406,773
                  
                  
                  839,148Long
                      term liabilitiesNote
                      payable and accrued interest - related party
                  
                  
                  2,613,901
                  
                  
                  1,708,240Total
                      liabilities
                  
                  
                  4,020,674
                  
                  
                  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
                  
                  
                  100,670Paid
                      in capital
                  
                  
                  1,101,049
                  
                  
                  1,101,049Deficit
                      accumulated during the development stage
                  
                  
                  (5,087,892
                  )
                  
                  (3,296,189
                  )Total
                      stockholders' deficiency in assets
                  
                  
                  (3,886,173
                  )
                  
                  (2,094,470
                  )Total
                      liabilities and stockholders' deficiency in assets
                  
                  $
                  134,501
                  
                  $
                  452,918
  See
        accompanying notes.
 3
  SPLINEX
        TECHNOLOGY INC.
 (A
        DEVELOPMENT STAGE COMPANY)
 CONDENSED
        CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS
  From
                    Inception(October
                    28,Three
                    Months
                
                Three
                    Months
                
                Six
                    Months
                
                Six
                    Months
                
                2003)Ended
                
                Ended
                
                Ended
                
                Ended
                
                ThroughSeptember
                    30,
                
                September
                    30,
                
                September
                    30,
                
                September
                    30,
                
                September
                    30,2005
                
                2004
                
                2005
                
                2004
                
                2005Net
                    sales
                
                $
                617
                
                $
                24
                
                $
                687
                
                $
                24
                
                
                736Operating
                    ExpensesSales
                    and marketing
                
                
                49,952
                
                
                96,723
                
                
                190,120
                
                
                117,933
                
                
                555,398General
                    and administrative
                
                
                688,661
                
                
                275,602
                
                
                958,159
                
                
                581,742
                
                
                2,864,065Research
                    and development
                
                
                287,014
                
                
                281,610
                
                
                588,203
                
                
                443,646
                
                
                1,910,725Total
                    operating expenses
                
                
                1,025,627
                
                
                653,935
                
                
                1,736,482
                
                
                1,143,321
                
                
                5,330,188Costs
                    of merger and registration
                
                
                —
                
                
                80,000
                
                
                —
                
                
                344,678
                
                
                512,321Total
                    expenses
                
                
                1,025,627
                
                
                733,935
                
                
                1,736,482
                
                
                1,487,999
                
                
                5,842,509Loss
                    from operations
                
                
                (1,025,010
                )
                
                (733,911
                )
                
                (1,735,795
                )
                
                (1,487,975
                )
                
                (5,841,773
                )Interest
                    expense, net
                
                
                (30,720
                )
                
                —
                
                
                (55,908
                )
                
                —
                
                
                (68,966
                )Loss
                    before income taxes
                
                
                (1,055,730
                )
                
                (733,911
                )
                
                (1,791,703
                )
                
                (1,487,975
                )
                
                (5,910,739
                )Income
                    taxes
                
                
                —
                
                
                —
                
                
                —
                
                
                —
                
                
                —Net
                    loss
                
                $
                (1,055,730
                )
                $
                (733,911
                )
                $
                (1,791,703
                )
                $
                (1,487,975
                )
                $
                (5,910,739
                )Net
                    loss per basic anddiluted
                    share
                
                $
                (0.01
                )
                $
                (0.01
                )
                $
                (0.02
                )
                $
                (0.02
                )Weighted
                    average sharesoutstanding
                
                
                100,670,270
                
                
                95,000,000
                
                
                100,670,270
                
                
                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**
                
                **Paid
                    in**
                
                **Development**
                
                **Deficiency****Shares**
                
                **Amount**
                
                **Shares**
                
                **Amount**
                
                **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
                )Net
                    loss
                
                
                —
                
                
                —
                
                
                —
                
                
                —
                
                
                —
                
                
                (1,791,703
                )
                
                (1,791,703
                )Balance
                    at September 30, 2005
                
                
                —
                
                $
                —
                
                
                100,670,270
                
                $
                100,670
                
                $
                1,101,049
                
                $
                (5,087,892
                )
                $
                (3,886,173
                )
 
 
 See
        accompanying notes.
 
  5
  SPLINEX
        TECHNOLOGY INC.
 (A
        DEVELOPMENT STAGE COMPANY)
 CONDENSED
        CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS
  CumulativeFrom
                    Inception(October
                    28,Six
                    Months
                
                Six
                    Months
                
                2003)Ended
                
                Ended
                
                ThroughSeptember
                    30, 2005
                
                September
                    30, 2004
                
                September
                    30, 2005Cash
                    flows from operating activities:Net
                    loss
                
                $
                (1,791,703
                )
                $
                (1,487,975
                )
                $
                (5,910,739
                )Adjustments
                    to reconcile net loss to netcash
                    used in operating activities:Depreciation
                
                
                13,232
                
                
                11,134
                
                
                42,800Executive
                    compensation and other expensespaid
                    with common stock
                
                
                —
                
                
                —
                
                
                24,566Non
                    cash interest expense
                
                
                55,661
                
                
                —
                
                
                63,901Changes
                    in operating assets and liabilities:Prepaid
                    expenses and other
                
                
                (14,812
                )
                
                3,438
                
                
                (52,082
                )Due
                    to related parties
                
                
                28,743
                
                
                (2,592
                )
                
                135,502Other
                    assets
                
                
                —
                
                
                (1,300
                )
                
                (9,881
                )Accounts
                    payable
                
                
                35,981
                
                
                299,929
                
                
                470,948Accrued
                    expenses
                
                
                561,159
                
                
                117,991
                
                
                782,731Total
                    adjustments
                
                
                679,965
                
                
                428,600
                
                
                1,458,486Net
                    cash used in operating activities
                
                
                (1,111,738
                )
                
                (1,059,375
                )
                
                (4,452,253
                )Cash
                    flows from investing activities:Purchase
                    or retirement of equipment
                
                
                6,710
                
                
                (20,706
                )
                
                (72,719
                )Employee
                    loans and advances, net
                
                
                7,485
                
                
                (39,355
                )
                
                (16,224
                )Net
                    cash used in investing activities
                
                
                14,194
                
                
                (60,061
                )
                
                (88,944
                )Cash
                    flows from financing activities:Note
                    payable related parties
                
                
                850,000
                
                
                —
                
                
                2,550,000Contributed
                    capital from equity investors
                
                
                —
                
                
                1,050,000
                
                
                2,000,000Net
                    cash provided by financing activities
                
                
                850,000
                
                
                1,050,000
                
                
                4,550,000Net
                    increase (decrease) in cash
                
                
                (247,543
                )
                
                (69,436
                )
                
                8,804Cash
                    at beginning of period
                
                
                256,347
                
                
                165,413
                
                
                —Cash
                    at end of period
                
                $
                8,804
                
                $
                95,977
                
                $
                8,804Supplemental
                    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
                )
  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 six months ended September 30, 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 September 30, 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 September 30, 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 September 30, 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
        pays
        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 six months ending
        September 30, 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 $1,951 and $73,804
        for
        the three months and six months ended September 30, 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 period ended September
        30, 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. In June 2005 the Company began marketing its ***nViz*** ***x*** product
        under a Reseller Agreement with a leading mathematical computational software
        developer. 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
  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”). In the three months ended
        September 30, 2005, Bzinfin and Ener1 Group, Inc. loaned the Company an
        additional $50,000 and $35,000, respectively. From October 1, 2005 through
        November 30, 2005, Ener1 Group, Inc. loaned the Company an additional
        $212,000.
 
 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 and have
        not
        been billed by the provider or paid by the Company. At September 30, 2005,
        accrued expenses consisted of the following:
  Accrued
                    severance
                
                $
                494,140Deferred
                    wages
                
                
                109,947Accrued
                    vacation
                
                
                48,198Accrued
                    outsourcing costs
                
                
                43,000Audit
                
                
                40,000Miscellaneous
                
                
                47,608$
                782,893
  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
  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 $100,000 for the three and six months ended September 30, 2005
        and
        $50,000 and $100,000 for the three months and six months ended September
        30,
        2004, respectively.
 
 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 $15,414
        and
        $30,829 for its office space under a sublease with Ener1 Group, Inc. for
        the
        three months and six months ended September 30, 2005 and $14,927 and $29,961
        for
        the three months and six months ended September 30, 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 $1,080 and $2,280 for the three months and six months ended
        September 30, 2005; general and administrative expenses and research and
        development expenses are net of reimbursements of $0 and $10,200 for the
        three
        months ended September 30, 2004 and $17,160 and $32,640 for the six months
        ended
        September 30, 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 $3,300
        and $7,700 for the three months and six months ended September 30, 2005 and
        $10,100 and $17,170 for the three months and six months ended September 30,
        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 six months ending
        September 30, 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 six months ending September 30, 2004, the Company
        paid
        $156,000 (unaudited) to Splinex Outsourcing LLC of which $108,000 was paid
        through ANTAO and the remainder was paid through the Russian
        consultant.
 
 NOTE
        7.
        LONG TERM DEBT DUE TO RELATED PARTY
 
 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
  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 September 30, 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 $2,500,000
        revolving loan agreement with a company that is affiliated with us through
        common ownership (the “Bzinfin Loan”). In the three months ended September 30,
        2005, Bzinfin and Ener1 Group, Inc. loaned us an additional $50,000 and $35,000,
        respectively. From October 1, 2005 through November 30, 2005, Ener1 Group,
        Inc.
        loaned us $212,000.
 
 **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.
  14
  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.
 
 At
        September 30, 2005, we had cash of $8,804 and negative working capital of
        $1,338,994.  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
        receiving funds 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
        assure 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.
 
 As
        of
        September 30, 2005, we have no
        material planned capital expenditures .
 
 **Results
        of** **Operations** **for the** **Three
        Month Period Ended** **September 30, 2005**
 
 We
        incurred a loss of $1,055,730, or $0.01 per share, for the three months ended
        September 30, 2005 compared to $733,911, or $0.01 per share in the prior
        year
        quarter. Average weighted shares outstanding were 100,670,270 for the three
        and
        six months ended September 30, 2005 and 95,000,000 for the three and six
        months
        ended September 30, 2004. Operating expenses of $1,025,627 for the three
        months
        ended September 30, 2005 included $49,952 for sales and marketing expenses,
        $688,661 for general and administrative expenses, and $287,014 for research
        and
        development costs. Operating expenses of $653,935 for the three months ended
        September 30, 2004 included $96,723 for sales and marketing expenses, $275,602
        for general and administrative expenses and $281,610 for research and
        development costs. Costs incurred in connection with the Merger and registration
        of the Distribution were $80,000 for the three months ended September 30,
        2004.
  15
  Sales
        and
        marketing expenses for the three months ended September 30, 2005 consisted
        primarily of wages and benefits of $39,379. Sales and marketing expenses
        for the
        three months ended September 30, 2004 consisted primarily of wages and benefits
        of $57,583 and web site development costs of $23,147. General and administrative
        expenses for the three months ended September 30, 2005 included severance
        expense of $404,960, wages and benefits of $89,892, consulting fees of $50,000
        paid to a director, Dr. Novak and, a related party, Mike Zoi; legal
        expenses of $27,401, of which $3,300 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 $30,845; insurance costs of $21,328; and rent
        of
        $15,414. The severance expense relates to the termination or resignation
        of
        certain executives and managers, and is payable through December 21, 2007.
        General and administrative expenses for the three months ended September
        30,
        2004 included wages and benefits of $61,040, consulting fees of $50,000 paid
        to
        a director, Dr. Novak and a related party, Mike Zoi; legal expenses
        of
        $10,700, of which $10,100 was payable to Ener1 Group to reimburse for the
        services of our general counsel; audit fees of $10,000; travel and related
        expenses of $19,102, insurance costs of $1,719; and rent of $14,927. Wages
        increased due to the hiring of a chief executive officer; travel increased
        due
        to the reimbursement of certain executives and managers for travel during
        2004;
        and insurance costs 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 three months ended September 30, 2005 included
        $196,355 for wages and benefits paid to U.S. based programmers; $84,207 for
        wages and administrative costs of our Russian-based scientists and programmers
        and $5,400 paid to software consultants. Research and development expenses
        for
        the three months ended September 30, 2004 included $140,364 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 $55,940 paid to
        software consultants. 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. Our research and development wages and benefits are net of
        reimbursements of $1,080 for the three months ended September 30, 2005; general
        and administrative expenses and research and development expenses are net
        of
        reimbursements of $0 and $10,200, respectively for the three months ended
        September 30, 2004.
 
 As
        a new
        public reporting company, our legal and accounting costs have increased in
        connection with compliance with reporting requirements under the Securities
        Exchange Act of 1934.
 
 **Results
        of Operations for the Six Month Period Ended September 30, 2005**
 
 We
        incurred a loss of $1,791,703, or $0.02 per share, for the six months ended
        September 30, 2005 compared to $1,487,975, or $0.02 per share for the six
        months
        ended September 30, 2004. Operating expenses of $1,736,482 for the six months
        ended September 30, 2005 included $190,120 for sales and marketing expenses,
        $958,159 for general and administrative expenses, and $588,203 for research
        and
        development costs. Operating expenses of $1,143,321 for the six months ended
        September 30, 2004 included $117,933 for sales and marketing expenses, $581,742
        for general and administrative expenses, and $443,646 for research and
        development costs. Costs incurred in connection with the merger and registration
        statement were $344,678 for the six months ended September 30,
        2004.
 
 Sales
        and
        marketing expenses for the six months ended September 30, 2005 consisted
        primarily of wages and benefits of $96,064 and direct mail advertising expenses
        of $71,338. Sales and marketing expenses for the six months ended September
        30,
        2004 consisted primarily of wages and benefits of $57,583, web site development
        costs of $23,229 and marketing consultants of $21,128. General and
        administrative expenses for the six months ended September 30, 2005 included
        severance expense of $404,960; wages and benefits of $193,964, consulting
        fees
        of $100,000 paid to a director, Dr. Novak, and Mike Zoi; legal expenses
        of
        $10,214, of which $7,700 was payable to Ener1 Group to reimburse Ener1 Group
        for
        the services of our general counsel; audit fees of $48,943; insurance costs
        of
        $42,015; and rent of $30,829. General and administrative expenses for the
        six
        months ended September 30, 2004 included wages and benefits of $169,45,
        consulting fees of $100,000 paid to a director, Dr. Novak, and Mike
        Zoi;
        legal expenses of $28,011, of which $17,170 was payable to Ener1 Group to
        reimburse Ener1 Group for the services of our general counsel; audit fees
        of
        $20,000; travel of $34,762, insurance costs of $3,438; and rent of $29,961.
        Wages increased due to the hiring of a chief executive officer; travel increased
        due to the reimbursement of certain executives and managers for travel during
        2004; audit expenses increased as a result of the Securities Act registration
        of
        the Distribution; and insurance expenses increased because we obtained a
        directors and officers liability insurance policy that was not in force in
        the
        prior year.
  16
  Research
        and development expenses for the six months ended September 30, 2005 included
        $401,962 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 $17,850 paid to software consultants. Research and development expenses
        for
        the six months ended September 30, 2004 included $193,372 for wages and benefits
        paid to U.S. based programmers; $144,000 for wages and administrative costs
        of
        our Russian-based scientists and programmers and $92,091 paid to software
        consultants. 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, our research and development wages and benefits
        are
        net of reimbursements of $2,280 for the six months ended September 30, 2005;
        general and administrative expenses and research and development expenses
        are
        net of reimbursements $17,160 and $32,640, respectively for the six months
        ended
        September 30, 2004.
 
 Interest
        expense was $55,908 and $30,720 for the six months and three months ended
        September 30, 2005. There was no interest expense in 2004. The increase in
        interest expense, which is payable at maturity, was due to borrowings under
        the
        Bzinfin Loan during 2005.
 
 **Liquidity
        and capital resources**
 
 At
        September 30, 2005, we had negative working capital of $1,338,994 and cash
        of
        $8,804. As of September 30, 2005, we have no further borrowing availability
        under the borrowing agreement.
 
 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 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 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
        are currently dependent upon funds borrowed from Ener1 Group, Inc. to pay
        our
        ongoing expenses which could include acquisitions or joint ventures of companies
        that could benefit from certain of the Company’s core technologies. We do not
        anticipate receiving funding sufficient [from whom?] to pay past due
        obligations, including severance obligations, until we have implemented our
        business development plans further.
  17
  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. In the three months ended September 30, 2005, Bzinfin and Ener1 Group,
        Inc. loaned us an additional $50,000 and $35,000, respectively. From October
        1,
        2005 through November 30, 2005, Ener1 Group, Inc. loaned us an additional
        $212,000. Terms for repayment and interest rate and other terms of these
        loans
        have not yet been established.
 
 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 September 30, 2005.
 
 **Off-balance
        sheet arrangements**
 
 At
        September 30, 2005, 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.
 
 As
        of
        September 30, 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 September 30, 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.
  18
  
 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.
 
  19
  Item
        6.
        Exhibits
 
 Exhibit
              
              DescriptionNumber2.1
              
              Agreement
                  and Plan of Merger among Ener1 Acquisition Corp., Registrant 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.,
                  Registrant 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)10.1
              
              Severance
                  Agreement dated November 21, 2005 by and between Splinex and Michael
                  Stojda, incorporated herein by reference to Exhibit 10.1 to Splinex's
                  Current Report on Form 8-K, filed with the Commission on November
                  21,
                  200510.2
              
              Termination
                  Agreement dated October 17, 2005 by and between Splinex and Christian
                  Schormann, incorporated herein by reference to Exhibit 10.2 to
                  Splinex's
                  Current Report on Form 8-K, filed witht the Commission on November
                  21,
                  200531.1
              
              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 and Principal Financial 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:
                  December 5, 2005
              
              By:
              
              /s/
                  Gerard A. Herlihy
                Name:
                  Gerard A. HerlihyTitle:
                  President and Chief Financial Officer
   21