NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE
            SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND
            EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON
            AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
            (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
            PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
            PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
            THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
            APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
            THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
            ACCEPTABLE TO THE COMPANY. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON
            EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
            MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.



MILLENNIUM CELL INC.

CLOSING WARRANT

|Warrant No. 2 | Date of Original Issuance: October 31, 2002
|------------- | -------------------------------------------

Millennium Cell Inc., a Delaware
            corporation (the "Company"), hereby certifies that, for value received,
            ZLP Master Technology Fund, Ltd. or its registered assigns (the
            "Holder"), is entitled to purchase from the Company up to a total of
            73,599 shares of common stock, $.001 par value per share (the "Common
            Stock"), of the Company (each such share, a "Warrant Share" and all
            such shares, the "Warrant Shares") at an exercise price (as adjusted
            from time to time as provided in Section 9, the "Exercise Price") per
            Warrant Share equal to $2.32, at any time and from time to time from and after
            the date hereof and through and including the fifth year anniversary of the
            date hereof (the "Expiration Date"), and subject to the following terms
            and conditions:

1.     Definitions.  In
            addition to the terms defined elsewhere in this Warrant, capitalized terms that
            are not otherwise defined herein that are defined in the Securities Purchase
            Agreement, dated October 31, 2002, to which the Company and the original Holder
            are parties (the "Purchase Agreement"), shall have the meanings given to
            such terms in the Purchase Agreement.

2.     Registration
            of Warrant.  The Company shall register this Warrant, upon
            records to be maintained by the Company for that purpose (the "Warrant
            Register"), in the name of the record Holder hereof from time to time. The
            Company may treat the registered Holder as the absolute owner hereof for the
            purpose of any exercise hereof or any distribution to the Holder, and for all
            other purposes, absent actual notice to the contrary.

3.     Registration
            of Transfers.  The Company shall register the transfer of any
            portion of this Warrant in the Warrant Register, upon surrender of this
            Warrant, with the Form of Assignment attached hereto duly completed and signed,
            to the Transfer Agent or to the Company at its address specified herein. Upon
            any such registration or transfer, a new warrant to purchase Common Stock, in
            substantially the form of this Warrant (any such new warrant, a "New
            Warrant"), evidencing the portion of this Warrant so transferred shall be
            issued to the transferee and a New Warrant evidencing the remaining portion of
            this Warrant not so transferred, if any, shall be issued to the transferring
            Holder. The acceptance of the New Warrant by the transferee thereof shall be
            deemed the acceptance by such transferee of all of the rights and obligations
            of a holder of a Warrant. The Holder shall be entitled to transfer or assign
            this Warrant to an affiliate thereof or to a fund under common management and
            the Company shall file with the Securities and Exchange Commission either an
            amendment or a supplement to any registration statement or prospectus
            previously filed pursuant to the Registration Rights Agreement (as defined in
            the Purchase Agreement) covering the resale of the Warrant Shares in order to
            reflect such transfer or assignment.

4.     Exercise
            and Duration.  Subject to the provisions of Section 5, this
            Warrant shall be exercisable by the registered Holder at any time and from time
            to time on or after the date hereof to and including the Expiration Date. At
            6:30 p.m., New York City time on the Expiration Date, the portion of this
            Warrant available for exercise and not exercised prior thereto shall be and
            become void and of no value, provided, that if the closing sales price
            of the Common Stock on the Expiration Date is greater than 102% of the Exercise
            Price on the Expiration Date, then this Warrant shall be deemed to have been
            exercised in full (to the extent not previously exercised) on in accordance
            with Section 10 hereof at 6:30 P.M. New York City time on the Expiration Date.

5.     Delivery
            of Warrant Shares.

(a)  Upon
            delivery of the Form of Election to Purchase to the Company (with the attached
            Warrant Shares Exercise Log) at its address for notice set forth in Section 13
            and upon payment of the Exercise Price multiplied by the number of Warrant
            Shares that the Holder intends to purchase hereunder, the Company shall
            promptly (but in no event later than three Trading Days after the Date of
            Exercise (as defined herein)) issue and deliver to the Holder, a certificate
            for the Warrant Shares issuable upon such exercise free of restrictive legends
            unless

-2-

otherwise required by the Purchase Agreement. The Company shall, upon
            request of the Holder and subsequent to the date on which a registration
            statement covering the resale of the Warrant Shares has been declared effective
            by the Securities and Exchange Commission, use its reasonable commercial
            efforts to deliver Warrant Shares hereunder electronically through the
            Depository Trust Corporation or another established clearing corporation
            performing similar functions, if available, provided, that, the Company may,
            but will not be required to change its transfer agent if its current transfer
            agent cannot deliver Warrant Shares electronically through the Depository Trust
            Corporation.

A "Date of Exercise" means the date
            on which the Holder shall have delivered to the Company (i) the Form of
            Election to Purchase attached hereto (with the Warrant Exercise Log attached to
            it), appropriately completed and duly signed and (ii) payment of the Exercise
            Price for the number of Warrant Shares so indicated by the Holder to be
            purchased.

(b)     If
            by the fifth Trading Day after a Date of Exercise the Company fails to deliver
            the required number of Warrant Shares in the manner required pursuant to
            Section 5(a), then the Holder will have the right to rescind such exercise.

(c)     If
            by the fifth Trading Day after a Date of Exercise the Company fails to deliver
            the required number of Warrant Shares in the manner required pursuant to
            Section 5(a), and if after such fifth Trading Day the Holder purchases (in an
            open market transaction or otherwise) shares of Common Stock to deliver in
            satisfaction of a sale by the Holder of the Warrant Shares which the Holder
            anticipated receiving upon such exercise (a "Buy-In"), then the Company
            shall (1) pay in cash to the Holder the amount by which (x) the Holder's total
            purchase price (including brokerage commissions, if any) for the shares of
            Common Stock so purchased exceeds (y) the amount obtained by multiplying (A)
            the number of Warrant Shares that the Company was required to deliver to the
            Holder in connection with the exercise at issue by (B) the closing bid price of
            the Common Stock at the time of the obligation giving rise to such purchase
            obligation and (2) at the option of the Holder, either reinstate the portion of
            the Warrant and equivalent number of Warrant Shares for which such exercise was
            not honored or deliver to the Holder the number of shares of Common Stock that
            would have been issued had the Company timely complied with its exercise and
            delivery obligations hereunder. For example, if the Holder purchases Common
            Stock having a total purchase price of $11,000 to cover a Buy-In with respect
            to an attempted exercise of shares of Common Stock with a market price on the
            date of exercise totaled $10,000, under clause (1) of the immediately preceding
            sentence the Company shall be required to pay the Holder $1,000. The Holder
            shall provide the Company written notice indicating the amounts payable to the
            Holder in respect of the Buy-In.

(d)     The
            Company's obligations to issue and deliver Warrant Shares in accordance with
            the terms hereof are absolute and unconditional, irrespective of any action or
            inaction by the Holder to enforce the same, any waiver or consent with respect
            to any provision hereof, the recovery of any judgment against any Person or any
            action to enforce the same, or any setoff, counterclaim, recoupment, limitation
            or termination, or any breach or alleged breach by the Holder or any other
            Person of any obligation to the Company or any violation or alleged violation
            of law by the Holder or any other Person, and irrespective of any other
            circumstance which might otherwise limit such obligation of the Company to the
            Holder in connection with the issuance of Warrant Shares. Nothing herein shall
            limit a Holder's right to pursue any other

-3-

remedies available to it hereunder, at law or in equity including,
            without limitation, a decree of specific performance and/or injunctive relief
            with respect to the Company's failure to timely deliver certificates
            representing shares of Common Stock upon exercise of the Warrant as required
            pursuant to the terms hereof.

6.     Charges,
            Taxes and Expenses.  Issuance and delivery of certificates for
            shares of Common Stock upon exercise of this Warrant shall be made without
            charge to the Holder for any issue or transfer tax, withholding tax, transfer
            agent fee or other incidental tax or expense in respect of the issuance of such
            certificates, all of which taxes and expenses shall be paid by the Company;
            provided, however, that the Company shall not be required to pay any tax which
            may be payable in respect of any transfer involved in the registration of any
            certificates for Warrant Shares or Warrants in a name other than that of the
            Holder. The Holder shall be responsible for all other tax liability that may
            arise as a result of holding or transferring this Warrant or receiving Warrant
            Shares upon exercise hereof.

7.     Replacement
            of Warrant.  If this Warrant is mutilated, lost, stolen or
            destroyed, the Company shall issue or cause to be issued in exchange and
            substitution for and upon cancellation hereof, or in lieu of and substitution
            for this Warrant, a New Warrant, but only upon receipt of evidence reasonably
            satisfactory to the Company of such loss, theft or destruction and customary
            and reasonable indemnity, if requested. Applicants for a New Warrant under such
            circumstances shall also comply with such other reasonable regulations and
            procedures and pay such other reasonable third-party costs as the Company may
            prescribe.

8.     Reservation
            of Warrant Shares.  The Company covenants that it will at all
            times reserve and keep available out of the aggregate of its authorized but
            unissued and otherwise unreserved Common Stock, solely for the purpose of
            enabling it to issue Warrant Shares upon exercise of this Warrant as herein
            provided, the number of Warrant Shares which are then issuable and deliverable
            upon the exercise of this entire Warrant. The Company covenants that all
            Warrant Shares so issuable and deliverable shall, upon issuance and the payment
            of the applicable Exercise Price in accordance with the terms hereof, be duly
            and validly authorized, issued and fully paid and nonassessable.

9.     Certain
            Adjustments.  The Exercise Price and number of Warrant Shares
            issuable upon exercise of this Warrant are subject to adjustment from time to
            time as set forth in this Section 9.

(a)     Stock
            Dividends and Splits.  If the Company, at any time while this
            Warrant is outstanding, (i) pays a stock dividend on its Common Stock or
            otherwise makes a distribution on any class of capital stock that is payable in
            shares of Common Stock, (ii) subdivides outstanding shares of Common Stock into
            a larger number of shares, or (iii) combines outstanding shares of Common Stock
            into a smaller number of shares, then in each such case the Exercise Price
            shall be multiplied by a fraction of which the numerator shall be the number of
            shares of Common Stock outstanding immediately before such event and of which
            the denominator shall be the number of shares of Common Stock outstanding
            immediately after such event.

-4-

(b)     Pro
            Rata Distributions.  If the Company, at any time while this
            Warrant is outstanding, distributes to all holders of Common Stock (i)
            evidences of its indebtedness, (ii) any security (other than a distribution of
            Common Stock covered by the preceding paragraph), (iii) rights or warrants to
            subscribe for or purchase any security, or (iv) any other asset (in each case,
            "Distributed Property"), then, at the request of any Holder delivered on
            the record date fixed for determination of stockholders entitled to receive
            such distribution, the Company will deliver to such Holder, within five Trading
            Days after such request (or, if later, on the effective date of such
            distribution), the Distributed Property that such Holder would have been
            entitled to receive in respect of the Warrant Shares for which such Holder's
            Warrant could have been exercised immediately prior to such record date. If
            such Distributed Property is not delivered to a Holder pursuant to the
            preceding sentence, then upon any exercise of the Warrant that occurs after
            such record date, such Holder shall be entitled to receive, in addition to the
            Warrant Shares otherwise issuable upon such conversion, the Distributed
            Property that such Holder would have been entitled to receive in respect of
            such number of Warrant Shares had the Holder been the record holder of such
            Warrant Shares immediately prior to such record date.

(c)     Fundamental
            Transactions.  If, at any time while this Warrant is outstanding:
            (i) the Company effects any merger or consolidation of the Company with or into
            another Person, (ii) the Company effects any sale of all or substantially all
            of its assets in one or a series of related transactions, (iii) any tender
            offer or exchange offer (whether by the Company or another Person) is completed
            pursuant to which holders of Common Stock are permitted to tender or exchange
            their shares for other securities, cash or property, or (iv) the Company
            effects any reclassification of the Common Stock or any compulsory share
            exchange pursuant to which the Common Stock is effectively converted into or
            exchanged for other securities, cash or property (in any such case, a
            "Fundamental Transaction"), then the Holder shall have the right
            thereafter to receive, upon exercise of this Warrant, the same amount and kind
            of securities, cash or property as it would have been entitled to receive upon
            the occurrence of such Fundamental Transaction if it had been, immediately
            prior to such Fundamental Transaction, the holder of the number of Warrant
            Shares then issuable upon exercise in full of this Warrant (the "Alternate
            Consideration"). For purposes of any such exercise, the determination of
            the Exercise Price shall be appropriately adjusted to apply to such Alternate
            Consideration based on the amount of Alternate Consideration issuable in
            respect of one share of Common Stock in such Fundamental Transaction, and the
            Company shall apportion the Exercise Price among the Alternate Consideration in
            a reasonable manner reflecting the relative value of any different components
            of the Alternate Consideration. If holders of Common Stock are given any choice
            as to the securities, cash or property to be received in a Fundamental
            Transaction, then the Holder shall be given the same choice as to the Alternate
            Consideration it receives upon any exercise of this Warrant following such
            Fundamental Transaction. At the Holder's option and request, any successor to
            the Company or surviving entity in such Fundamental Transaction shall, either
            (i) issue to the Holder a new warrant substantially in the form of this Warrant
            and consistent with the foregoing provisions and omitting subsection 9(d) below
            and evidencing the Holder's right to purchase the Alternate Consideration for
            the aggregate Exercise Price upon exercise thereof, or (ii) purchase the
            Warrant from the Holder for a purchase price, payable in cash within five
            Trading Days after such request (or, if later, on the effective date of the
            Fundamental Transaction), equal to the Black Scholes value of the remaining
            unexercised portion of this Warrant on the date of the Fundamental Transaction
            as well as assumptions reasonably mutually acceptable to the Company and the
            Holder, provided that for purposes of such calculation, the

-5-

market price of the Common Stock shall be the closing bid price of the
            Common Stock on the Trading Day immediately preceding the public announcement
            of the Fundamental Transaction and the volatility factor shall be determined by
            reference to the 12 month average industry volatility measures. The terms of
            any agreement pursuant to which a Fundamental Transaction is effected shall
            include terms requiring any such successor or surviving entity to comply with
            the provisions of this paragraph (c) and insuring that the Warrant (or any such
            replacement security) will be similarly adjusted upon any subsequent
            transaction analogous to a Fundamental Transaction.

(d)     Subsequent
            Equity Sales.

(i)     If
            the Company or any subsidiary thereof, as applicable with respect to Common
            Stock Equivalents (as defined below), at any time while this Warrant is
            outstanding, shall issue shares of Common Stock or rights, warrants, options or
            other securities or debt that is convertible into or exchangeable for shares of
            Common Stock ("Common Stock Equivalents") entitling any Person to
            acquire shares of Common Stock, at a price per share less than the Exercise
            Price (if the holder of the Common Stock or Common Stock Equivalent so issued
            shall at any time, whether by operation of purchase price adjustments, reset
            provisions, floating conversion, exercise or exchange prices or otherwise, or
            due to warrants, options or rights issued in connection with such issuance, be
            entitled to receive shares of Common Stock at a price less than the Exercise
            Price, such issuance shall be deemed to have occurred for less than the
            Exercise Price), then, at the option of the Holder for such exercises as it
            shall indicate, the Exercise Price shall be adjusted to mirror the conversion,
            exchange or purchase price for such Common Stock or Common Stock Equivalents
            (including any reset provisions thereof) at issue. Such adjustment shall be
            made whenever such Common Stock or Common Stock Equivalents are issued. The
            Company shall notify the Holder in writing, no later than the Trading Day
            following the issuance of any Common Stock or Common Stock Equivalent subject
            to this section, indicating therein the applicable issuance price, or of
            applicable reset price, exchange price, conversion price and other pricing
            terms. Notwithstanding the foregoing, no adjustment will be made under this
            Section 9(d) in respect of:

| | (A).     
                   Any grant of an option or warrant for Common Stock or issuance of any shares of
                   Common Stock upon the exercise of any options or warrants to employees,
                   officers and directors of or consultants to the Company pursuant to any stock
                   option plan, employee stock purchase plan or similar plan or incentive or
                   consulting arrangement approved by the Companys board of directors;
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (B).     
                   Any rights or agreements to purchase Common Stock Equivalents outstanding on
                   the date hereof and as specified in Schedule 3.1(g) to the Purchase Agreement
                   (but not as to any amendments or other modifications to the number of Common
                   Stock issuable thereunder, the terms set forth therein, or the exercise price
                   set forth therein);                                           
| | (C).     
                   Any Common Stock or Common Stock Equivalents issued for consideration other
                   than cash pursuant to a merger, consolidation, acquisition or other similar
                   business combination;                                                                                                                                                                                                                                             

-6-



| | (D).     
                   Any issuances of Common Stock or Common Stock Equivalents to a Person which is
                   or will be, itself or through its subsidiaries, an operating company in a
                   business related to or complementary with the business of the Company and in
                   which the Company receives reasonably material benefits in addition to the
                   investment of funds, but shall not include a transaction in which the Company
                   is issuing securities primarily for the purpose of raising capital or to an
                   entity whose primary business is investing in securities;                                                                                                                                                                                                                                                     
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (E).     
                   Any Common Stock Equivalents that entitle the holders thereof to acquire up to
                   500,000 shares of Common Stock issued pursuant to any equipment leasing
                   arrangement;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (F).     
                   Any Common Stock or Common Stock Equivalents issued to pay all or a portion of
                   any investment banking, finders or similar fee or commission, which entitles
                   the holders thereof to acquire shares of Common Stock at a price not less than
                   the market price of the Common Stock on the date of such issuance and which is
                   not subject to any adjustments other than on account of stock splits and
                   reverse stock splits;                                                                                                                                                                                                                                                                                                                                                                                    
| | (F).     
                   Any shares of Common Stock issued upon: (i) exercise of the Warrants (as
                   defined in the Purchase Agreement) or the warrants issued by the Company on
                   June 19, 2002 to Pine Ridge Financial, Inc. and ZLP Master Technology Fund,
                   Ltd. or (ii) conversion of the Debentures (as defined in the Purchase
                   Agreement);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (G).     
                   Any adjustment to the Conversion Price (as defined in the Debentures) or
                   exercise price in the Warrants; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (H).     
                   a bonafide underwritten public offering of the Common Stock resulting in gross
                   proceeds in excess of $15 million to the Company (it being understood that
                   equity line transactions, including any on going warrant financing, or any
                   similar arrangements shall not constitute a bona fide underwritten public
                   offering of the Common Stock for the purposes hereof).                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (ii)     
                   If, at any time while this Warrant is outstanding, the Company or any
                   Subsidiary issues Common Stock Equivalents at a price per share that floats or
                   resets or otherwise varies or is subject to adjustment based on market prices
                   of the Common Stock (a "Floating Price Security"), then for purposes of
                   applying the preceding paragraph in connection with any subsequent exercise,
                   the Exercise Price will be determined separately on each Exercise Date and will
                   be deemed to equal the lowest price per share at which any holder of such
                   Floating Price Security is entitled to acquire shares of Common Stock on such
                   Exercise Date (regardless of whether any such holder actually acquires any
                   shares on such date).

(e)     
            Number of Warrant Shares.  Simultaneously with any adjustment
            to the Exercise Price pursuant to paragraphs (a), (b) or (d) of this Section,
            the number of Warrant Shares that may be purchased upon exercise of this
            Warrant shall be increased or decreased

-7-

proportionately, so that after such adjustment the aggregate Exercise
            Price payable hereunder for the adjusted number of Warrant Shares shall be the
            same as the aggregate Exercise Price in effect immediately prior to such
            adjustment.

(f)     Calculations.  All
            calculations under this Section 9 shall be made to the nearest cent or
            the nearest 1/100th of a share, as applicable. The number of shares of Common
            Stock outstanding at any given time shall not include shares owned or held by
            or for the account of the Company, and the disposition of any such shares shall
            be considered an issue or sale of Common Stock.

(g)     Notice
            of Adjustments.  Upon the occurrence of each adjustment pursuant
            to this Section 9, the Company at its expense will promptly compute such
            adjustment in accordance with the terms of this Warrant and prepare a
            certificate setting forth such adjustment, including a statement of the
            adjusted Exercise Price and adjusted number or type of Warrant Shares or other
            securities issuable upon exercise of this Warrant (as applicable), describing
            the transactions giving rise to such adjustments and showing in detail the
            facts upon which such adjustment is based. Upon written request, the Company
            will promptly deliver a copy of each such certificate to the Holder and to the
            Company's Transfer Agent.

(h)     Notice
            of Corporate Events.  If the Company (i) declares a dividend or
            any other distribution of cash, securities or other property in respect of its
            Common Stock, including without limitation any granting of rights or warrants
            to subscribe for or purchase any capital stock of the Company or any
            Subsidiary, (ii) authorizes or approves, enters into any agreement providing
            for or solicits stockholder approval for any Fundamental Transaction or (iii)
            authorizes the voluntary dissolution, liquidation or winding up of the affairs
            of the Company, then the Company shall deliver to the Holder a notice
            describing the material terms and conditions of such transaction, at least 20
            calendar days prior to the applicable record or effective date on which a
            Person would need to hold Common Stock in order to participate in or vote with
            respect to such transaction, and the Company will take all steps reasonably
            necessary in order to insure that the Holder is given the practical opportunity
            to exercise this Warrant prior to such time so as to participate in or vote
            with respect to such transaction; provided, however, that the failure to
            deliver such notice or any defect therein shall not affect the validity of the
            corporate action required to be described in such notice.

10.     Payment
            of Exercise Price.  The Holder shall pay the Exercise Price in
            one of the following manners:

(a)     Cash
            Exercise.  The Holder may deliver immediately available funds; or

(b)     Cashless
            Exercise.     At any time after the earlier to
            occur of: (x) the date the registration statement covering the resale of the
            Warrant Shares and filed pursuant to the Registration Rights Agreement is
            declared effective by the Commission and (y) the Effectiveness Date (as defined
            in the Registration Rights Agreement) related to such registration statement,
            when a registration statement covering the resale of the Warrant Shares and
            naming the Holder as a selling stockholder thereunder is not then effective,
            the Holder may surrender this Warrant to the Company together with a notice of
            cashless exercise, in which event the Company shall issue to the Holder the
            number of Warrant Shares determined as follows

-8-

| |        | X = Y [(A-B)/A]                                                                                                                                        
| | ------ | -------------------------------------------------------------------------------------------------------------------------------------------------------
| | where: |                                                                                                                                                        
| |        | X = the number of Warrant Shares to be issued to the Holder.                                                                                           
| |        | Y = the number of Warrant Shares with respect to which this Warrant
                        is being exercised.                                        
| |        | A = the average of the closing bid prices for the five Trading Days
                        immediately prior to (but not including) the Exercise Date.
| |        | B = the Exercise Price.                                                                                                                                
| |        |                                                                                                                                                        

For purposes of Rule 144
            promulgated under the Securities Act, it is intended, understood and
            acknowledged that the Warrant Shares issued in a cashless exercise transaction
            shall be deemed to have been acquired by the Holder, and the holding period for
            the Warrant Shares shall be deemed to have commenced, on the date this Warrant
            was originally issued pursuant to the Purchase Agreement.

11.     Limitations
            on Exercise.  (a)  Notwithstanding anything to the
            contrary contained herein, the number of shares of Common Stock that may be
            acquired by the Holder upon any exercise of this Warrant (or otherwise in
            respect hereof) shall be limited to the extent necessary to insure that,
            following such exercise (or other issuance), the total number of shares of
            Common Stock then beneficially owned by such Holder and its affiliates and any
            other Persons who beneficial ownership of Common Stock would be aggregated with
            the Holder's for purposes of Section 13(d) of the Exchange Act, does not exceed
            9.999% of the total number of issued and outstanding shares of Common Stock
            (including for such purpose the shares of Common Stock issuable upon such
            exercise). For such purposes, beneficial ownership shall be determined in
            accordance with Section 13(d) of the Exchange Act and the rules and regulations
            promulgated thereunder. Each delivery of an Exercise Notice hereunder will
            constitute a representation by the Holder that it has evaluated the limitation
            set forth in this paragraph and determined that issuance of the full number of
            Warrant Shares requested in such Exercise Notice is permitted under this
            paragraph. This provision shall not restrict the number of shares of Common
            Stock which a Holder may receive or beneficially own in order to determine the
            amount of securities or other consideration that such Holder may receive in the
            event of a merger or other business combination or reclassivication involving
            the Company as contemplated in Section 9 of this Warrant.

(b)     If
            the Company has not obtained the Shareholder Approval (as defined below), then
            the Company may not issue in excess of 91,998 shares of Common Stock (such
            number of shares, as adjusted from time to time, the "Issuable
            Maximum"). If the Holder shall no longer hold the Warrant due to exercise
            or cancellation of the Warrant, then the Holder's remaining portion of the
            Issuable Maximum shall be allocated pro-rata among the remaining Holders. If on
            any Date of Exercise: (A) the aggregate number of shares of Common Stock that
            would then be issuable upon exercise in full of this Warrant would exceed the
            Issuable Maximum, and (B) the Company shall not have previously obtained the
            vote of shareholders (the "Shareholder Approval"), if any, as may be
            required by the applicable rules and regulations of

-9-

the Nasdaq National Market (or any successor entity) applicable to
            approve the issuance of shares of Common Stock in excess of the Issuable
            Maximum pursuant to the terms hereof, then the Company shall issue to the
            Holder a number of shares of Common Stock equal to the Issuable Maximum and,
            with respect to the remainder of the Warrant Shares then issuable under the
            Warrant for which an exercise in accordance with the applicable exercise price
            would result in an issuance of shares of Common Stock in excess of the Issuable
            Maximum (the "Excess Warrant Shares"), the Holder shall have the option
            to require the Company to use its best efforts to obtain the Shareholder
            Approval applicable to such issuance as soon as is possible, but in any event
            not later than the 90th day after such request. The Company and the Holder
            understand and agree that shares of Common Stock issued to and then held by the
            Holder as a result of exercise of this Warrant shall not be entitled to cast
            votes on any resolution to obtain Shareholder Approval pursuant hereto. If the
            Company shall succeed in obtaining the Shareholder Approval, the Excess Warrant
            Shares shall again become fully exercisable by the Holder.

12.     No
            Fractional Shares.   No fractional shares of Warrant Shares will
            be issued in connection with any exercise of this Warrant. In lieu of any
            fractional shares which would, otherwise be issuable, the Company shall pay
            cash equal to the product of such fraction multiplied by the closing bid price
            of one Warrant Share as reported on the Nasdaq National Market on the date of
            exercise.

13.     Notices.   Any and all notices or other communications or
            deliveries hereunder (including without limitation any Exercise Notice) shall
            be in writing and shall be deemed given and effective on the earliest of (i)
            the date of transmission, if such notice or communication is delivered via
            facsimile at the facsimile number specified in this Section prior to 6:30 p.m.
            (New York City time) on a Trading Day, (ii) the next Trading Day after the date
            of transmission, if such notice or communication is delivered via facsimile at
            the facsimile number specified in this Section on a day that is not a Trading
            Day or later than 6:30 p.m. (New York City time) on any Trading Day, (iii) the
            Trading Day following the date of mailing, if sent by nationally recognized
            overnight courier service, or (iv) upon actual receipt by the party to whom
            such notice is required to be given. The addresses for such communications
            shall be: (i) if to the Company, to Millennium Cell Inc., 1 Industrial Way
            West, Eatontown, New Jersey, 07724, Facsimile No.: (732) 542-4010, Attn: Chief
            Financial Officer, or (ii) if to the Holder, to the address or facsimile number
            appearing on the Warrant Register or such other address or facsimile number as
            the Holder may provide to the Company in accordance with this Section.

14.     Warrant Agent.   The Company shall serve as warrant agent under
            this Warrant. Upon 30 days' notice to the Holder, the Company may appoint a new
            warrant agent. Any corporation into which the Company or any new warrant agent
            may be merged or any corporation resulting from any consolidation to which the
            Company or any new warrant agent shall be a party or any corporation to which
            the Company or any new warrant agent transfers substantially all of its
            corporate trust or shareholders services business shall be a successor warrant
            agent under this Warrant without any further act. Any such successor warrant
            agent shall promptly cause notice of its succession as warrant agent to be
            mailed (by first class mail, postage prepaid) to the Holder at the Holder's
            last address as shown on the Warrant Register.

-10-

15.     Miscellaneous.

(a)     This
            Warrant shall be binding on and inure to the benefit of the parties hereto and
            their respective successors and assigns. Subject to the preceding sentence,
            nothing in this Warrant shall be construed to give to any Person other than the
            Company and the Holder any legal or equitable right, remedy or cause of action
            under this Warrant. This Warrant may be amended only in writing signed by the
            Company and the Holder and their successors and assigns.

(b)     All
            questions concerning the construction, validity, enforcement and interpretation
            of this Warrant shall be governed by and construed and enforced in accordance
            with the internal laws of the State of New York, without regard to the
            principles of conflicts of law thereof. Each party agrees that all legal
            proceedings concerning the interpretations, enforcement and defense of the
            transactions contemplated by this Warrant (whether brought against a party
            hereto or its respective affiliates, directors, officers, shareholders,
            employees or agents) shall be commenced in the state and federal courts sitting
            in the City of New York, Borough of Manhattan. Each party hereto hereby
            irrevocably submits to the exclusive jurisdiction of the state and federal
            courts sitting in the City of New York, Borough of Manhattan for the
            adjudication of any dispute hereunder or in connection herewith or with any
            transaction contemplated hereby or discussed herein (including with respect to
            the enforcement of this Warrant), and hereby irrevocably waives, and agrees not
            to assert in any suit, action or proceeding, any claim that it is not
            personally subject to the jurisdiction of any such court, that such suit,
            action or proceeding is improper. Each party hereto hereby irrevocably waives
            personal service of process and consents to process being served in any such
            suit, action or proceeding by mailing a copy thereof via registered or
            certified mail or overnight delivery (with evidence of delivery) to such party
            at the address in effect for notices to it under this Warrant and agrees that
            such service shall constitute good and sufficient service of process and notice
            thereof. Nothing contained herein shall be deemed to limit in any way any right
            to serve process in any manner permitted by law. Each party hereto (including
            its affiliates, agents, officers, directors and employees) hereby irrevocably
            waives, to the fullest extent permitted by applicable law, any and all right to
            trial by jury in any legal proceeding arising out of or relating to this
            Warrant or the transactions contemplated hereby. If either party shall commence
            an action or proceeding to enforce any provisions of this Warrant, then the
            prevailing party in such action or proceeding shall be reimbursed by the other
            party for its attorneys fees and other costs and expenses incurred with the
            investigation, preparation and prosecution of such action or proceeding.

(c)     The
            headings herein are for convenience only, do not constitute a part of this
            Warrant and shall not be deemed to limit or affect any of the provisions
            hereof.

(d)     In
            case any one or more of the provisions of this Warrant shall be invalid or
            unenforceable in any respect, the validity and enforceability of the remaining
            terms and provisions of this Warrant shall not in any way be affected or
            impaired thereby and the parties will attempt in good faith to agree upon a
            valid and enforceable provision which shall be a commercially reasonable
            substitute therefor, and upon so agreeing, shall incorporate such substitute
            provision in this Warrant.

-11-

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK, SIGNATURE PAGE
            FOLLOWS]

-12-

IN WITNESS
            WHEREOF, the Company has caused this Warrant to be duly executed by its
            authorized officer as of the date first indicated above.



| | MILLENNIUM CELL INC.                                                                                          
| | --------------------------------------------------------------------------------------------------------------
| |                                                                                                               
| | By: /s/ Norman R. Harpster, Jr.Name: Norman
                   R. Harpster, Jr. Title: Chief Financial Officer









-13-

FORM OF ELECTION TO PURCHASE

To Millennium Cell Inc.:

In accordance with
            Warrant No. [ ] issued to the undersigned, the undersigned hereby elects to
            purchase _____________ shares of common stock ("Common Stock"), $.001
            par value per share, of Millennium Cell Inc., and, if such Holder is not
            utilizing the cashless exercise provisions set forth in this Warrant, encloses
            herewith $________ in cash, certified or official bank check or checks, which
            sum represents the aggregate Exercise Price (as defined in the Warrant) for the
            number of shares of Common Stock to which this Form of Election to Purchase
            relates.

By its delivery of this
            Form of Election To Purchase, the Holder represents and warrants to the Company
            that in giving effect to the exercise evidenced hereby the Holder will not
            beneficially own in excess of the number of shares of Common Stock (determined
            in accordance with Section 13(d) of the Securities Exchange Act of 1934)
            permitted to be owned under Section 11 of this Warrant to which this notice
            relates.

The undersigned requests
            that certificates for the shares of Common Stock issuable upon this exercise be
            issued in the name of



| | PLEASE INSERT SOCIAL SECURITY OR TAX IDENTIFICATION
                   NUMBER
| | -----------------------------------------------------------------------------
| | (Please print name and address)                                              

Warrant Shares Exercise Log

|Date | Number of Warrant Shares Available to be
                   Exercised | Number of Warrant Shares Exercised | Number of Warrant Shares Remaining to be
                   Exercised
|---- | --------------------------------------------------------------------- | ---------------------------------- | ---------------------------------------------------------------------
|     |                                                                       |                                    |                                                                      

FORM OF ASSIGNMENT



[To be completed and signed only upon transfer of Warrant]



FOR VALUE
            RECEIVED, the undersigned hereby sells, assigns and transfers unto
            ________________________________ the right represented by the within Warrant to
            purchase ____________ shares of Common Stock of Millennium Cell Inc., to which
            the within Warrant relates and appoints ________________ attorney to transfer
            said right on the books of Millennium Cell Inc., with full power of
            substitution in the premises.

|Dated: _______________, ____ |                                                                                                                      
|---------------------------- | ---------------------------------------------------------------------------------------------------------------------
|                             |                                                                                                                      
|                             | (Signature must conform in all respects to name of holder as
                   specified on the face of the Warrant)
|                             |                                                                                                                      
|                             |                                                                                                                      
|                             | Address of Transferee                                                                                                
|                             |                                                                                                                      
|                             |                                                                                                                      
|                             |                                                                                                                      
|In the presence of:          |                                                                                                                      
|                             |                                                                                                                      
|                             |