LICENSE
AGREEMENT

THIS LICENSE AGREEMENT (this
Agreement) is dated effective as of October 20, 2004by and
between Ener1, Inc.hereinafter called LICENSEE, a corporation
of the State of Florida,

AND

EnerDel, Inc. hereinafter
called LICENSOR, a company of the State of Delaware.

WHEREAS,
LICENSOR is acquiring certain assets of LICENSEE related exclusively to the
LICENSORS lithium battery business (the Business) pursuant to a
Formation, Subscription and Stockholders Agreement dated of even date herewith (the
Formation Agreement) of which this Agreement is Exhibit
4.4.B(iii), which assets include the intellectual property assets referred
to in Clause 1.A and 1.B of Exhibit 2.1 of the Formation Agreement,
including but not limited to the patents and patent applications listed therein and
related know-how (collectively, the Licensed Intellectual Property);

WHEREAS,the above-described intellectual property assets acquired by LICENSOR under the
Formation Agreement may have application outside the field of lithium batteries;

WHEREAS,
LICENSEE desires a license to the Licensed Intellectual Property for use outside the field
of lithium batteries and LICENSOR is willing to grant such a license;

NOW,
THEREFORE, LICENSOR and LICENSEE agree as follows:

# General Definitions:

Section
1-A. All defined terms as used in the Formation Agreement shall have the same
definition in this Agreement, unless otherwise specifically defined herein.

Section
l-B. The term Licensed Products as used herein, means all products
other than lithium batteries and components thereof, either directly covered by the
Licensed Intellectual Property or the manufacture of which is covered by the Licensed
Intellectual Property.

Section
1-C. The term Licensed Patent means any or all of the U.S. and
Ukrainian patents and patent applications set forth in Exhibit A, as
well as any divisionals, continuations, continuations-in-part, reissues, reexamination
certificates, and other extensions thereof, and also all foreign corresponding patent
applications and patents.

# Licenses Granted:

Section
2-A. LICENSOR grants to LICENSEE a paid-up, royalty-free, perpetual worldwide license
under the Licensed Intellectual Property, including the right to sublicense, solely to use
the Licensed Intellectual Property in the development of Licensed Products, to manufacture
or have manufactured Licensed Products and parts therefor, and to sell or use such
Licensed Products and parts therefor. The license granted under this Section 2-A shall be
exclusive to LICENSEE except for cases where LICENSOR is obligated to provide license
rights to sublicensees under the July 25, 2003 License and Royalty Agreement between
Ener1, Inc., Ener1 Battery Company, and Itochu Corporation (the License and
Royalty Agreement), which agreement is being assigned to LICENSEE under separate
agreement of even date herewith.

Section
2-B. The license rights granted herein shall not include any use of the Licensed
Intellectual Property for lithium batteries.

Section
2-C. This Agreement is subject to all applicable laws and regulations of the U.S.
Government. Each party shall be responsible for obtaining any necessary import licenses,
export licenses or other governmental authorizations required in connection with any
disclosure by it under this Agreement, including disclosures to foreign nationals located
within a facility of a party hereto, as the case may be. Furnishing of information shall
be subject to prior receipt of all necessary governmental approvals.

Section
2-D. No license, either express or implied, is granted by LICENSOR to LICENSEE
hereunder with respect to any patent or information except as specifically stated above.

# Patent Provisions:

Section
3-A. LICENSOR shall at all times have the sole right, but not the obligation, to take
whatever steps it deems necessary or desirable to enforce the Licensed Patents, including
the filing and prosecution of patent litigation; and LICENSOR shall have the right to
include LICENSEE as a party in such litigation where necessary for the conduct thereof. If
LICENSOR and LICENSEE desire and agree to joint participation in any infringement suit or
other enforcement action with respect to any of the Licensed Patents, the respective
responsibilities of the parties, and their contributions to the costs and participation in
any recoveries, will be agreed upon in writing prior to undertaking such joint enforcement
action.

Section
3-B. LICENSOR does not make any representation to LICENSEE regarding the scope or
enforceability of the Licensed Patents, and does not warrant that any Licensed Products or
parts therefor manufactured or sold under this Agreement will not infringe patents of
others.

# Enforcement and
Litigation:

Section
4-A. LICENSEE will at all times have the right in the first instance to take whatever
steps it deems necessary or desirable at its own expense to enforce its rights with
respect to the Licensed Intellectual Property solely within the scope of the license
granted under Section 2-A, including, without limitation, the filing and prosecution of
litigation. LICENSOR shall provide, at LICENSEEs request and expense, reasonable
cooperation to LICENSEE in the execution of any documents or other similar assistance
required for LICENSEE to take such steps, including joining LICENSEE as a party in any
litigation where reasonably necessary for the conduct thereof. LICENSEE shall be entitled
to any recovery obtained through enforcement action taken under this Section 4-A.

Section
4-B. If LICENSEE is made aware of any infringement of the Licensed Intellectual
Property that is occurring or has occurred solely within the scope of the license granted
under Section 2-A, and decides not to take any action to enforce its rights pursuant to
Section 4-A, it shall so notify LICENSOR of such decision, whereupon LICENSOR shall then
have the right, but not the obligation, to take whatever steps it deems necessary or
desirable at its own expense to enforce its rights with respect to the Licensed
Intellectual Property; and in such event LICENSEE shall provide, at LICENSORs
request and expense, reasonable cooperation to LICENSOR in the execution of any documents
or other similar assistance required for LICENSOR to take such steps, including joining
LICENSOR as a party in any litigation where reasonably necessary for the conduct thereof.
LICENSOR shall be entitled to any recovery obtained through enforcement action taken under
this Section 4-B.

Section
4-C. For any infringement of the Licensed Intellectual Property that is occurring or
has occurred outside the scope of the license granted under Section 2-A, LICENSOR shall at
all times have the right to take whatever steps it deems necessary or desirable to protect
or enforce the Licensed Intellectual Property anywhere in the world, including the filing
and prosecution of litigation. LICENSEE shall provide, at LICENSORs request and
expense, reasonable cooperation to LICENSOR in the execution of any documents or other
similar assistance required for LICENSOR to take such steps, including joining LICENSOR as
a party in any litigation where reasonably necessary for the conduct thereof. LICENSOR
shall be entitled to any recovery obtained through enforcement action taken under this
Section 4-C.

# Duration and Assignment:

Section
5-A. This Agreement shall be effective upon the Effective Date of the Formation
Agreement and will continue in force until the latest expiration date of the patents that
are part of the Licensed Intellectual Property.

Section
5-B. This Agreement shall inure to the benefit of and be binding upon the successors
and assigns of the parties hereto.

# Miscellaneous Provisions:

Section
6-A. Failure of either party to insist upon the strict performance of any provisions
hereof or to exercise any right or remedy shall not be deemed a waiver of any right or
remedy with respect to any existing or subsequent breach or default; the election by
either party of any particular right or remedy shall not be deemed to exclude any other;
and all rights and remedies of either party shall be cumulative.

Section
6-B. Any notice required or permitted hereunder shall be in writing and shall be
sufficiently given when mailed postpaid first class registered air mail and addressed to
the party for whom it is intended at its record address, and such notice shall be
effective as of the date it is deposited in the mail. The record address of LICENSOR for
this purpose is:

EnerDel,
Inc.          500
West Cypress Creek Road          Suite 100          Fort Lauderdale, Florida 33309

and the record address of
LICENSEE is

Ener1,
Inc.          500
West Cypress Creek Road          Suite 100          Fort Lauderdale, Florida 33309

Section
6-C. LICENSEE shall, at its own expense, take whatever steps are required to satisfy
the laws and requirements of any countries with respect to declaring, recording, and
otherwise rendering this Agreement valid.

Section
6-D. If any provision or provisions of this Agreement in any way contravene a law of
any state or country in which this Agreement is effective, the remaining provisions of
this Agreement shall not be affected thereby and this Agreement shall be modified to
conform with such law. Notwithstanding the foregoing, in the event of any such
contravention LICENSOR may at its option terminate this Agreement forthwith by giving to
LICENSEE written notice of termination.

Section
6-E. This Agreement contains all of the terms and conditions agreed upon by the
parties hereto regarding the specific subject matter hereof; and this Agreement may be
modified only by an instrument in writing executed on behalf of the parties by their
respective duly authorized officers.

Section
6-F. Any dispute, controversy or claim (hereinafter Dispute)
between the Investors of any kind or nature whatsoever based on or arising from a claimed
breach of this Agreement by either Investor, and whether arising in contract, tort or
otherwise, shall be resolved according to the following procedure. If such a Dispute is
not resolved by good faith negotiations between the Investors, then such Dispute, upon
thirty (30) days prior notice from one Investor to the other of its intent to
arbitrate (an Arbitration Notice), shall be submitted to and settled by
arbitration; provided, however, that nothing contained herein shall preclude any
Investor hereto from seeking or obtaining: (i) injunctive relief; or (ii) equitable or
other judicial relief to enforce the provisions hereof or to preserve the status quo
pending resolution of disputes hereunder. Such arbitration shall be conducted in
accordance with the commercial arbitration rules of the American Arbitration Association
existing at the time of submission by one arbitrator. The Investors shall attempt to agree
upon an arbitrator. If one cannot be agreed upon, the Investor which did not give the
Arbitration Notice may request the Chief Judge of the United States District Court for the
[Eastern District of Michigan] to appoint an arbitrator. If he or she will not, the
arbitrator shall be appointed by the American Arbitration Association. If an arbitrator so
selected becomes unable to serve, his or her successor shall be similarly selected or
appointed. All arbitration hearings shall be conducted on an expedited schedule, and all
proceedings shall be confidential. Either Investor may at its expense make a stenographic
record thereof. The arbitrator shall apportion all costs and expenses of arbitration
(including the arbitrators fees and expenses, the fees and expenses of experts, and
the fees and expenses of counsel of the Investors), between the prevailing and
non-prevailing Investor as the arbitrator deems fair and reasonable. Any arbitration award
shall be binding and enforceable against the Investors hereto and judgment may be entered
thereon in any court of competent jurisdiction. The arbitration will take place at Fort
Lauderdale, Florida.

Section
6-G. This Agreement shall be construed, governed and enforced in accordance with the
laws of the State of Delaware, without regard to the conflicts of laws provisions thereof.

The
parties hereto have caused this Agreement to be executed, in triplicate, by their
respective duly authorized officers on the dates and at the places indicated below.

|                                                                                                                                                                                                                                                    |                                                                                                                                                              
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|LICENSOR:                         
EnerDel, Inc.                     
By:  ____________________________ 
         Kevin P. Fitzgerald      
Title:   Chief Executive Officer  
                                  
Date:____________________________ | LICENSEE:
Ener1, Inc.
By:  ____________________________      
         Ronald N. Stewart

Title:   Executive Vice President
Date:____________________________

EXHIBIT
A

| | SOLID
POLYMER ELECTROLYTE LITHIUM BATTERY
                    U.S. Patent Application No. 10/038,556, claiming priority on U.S. Provisional
                    Application No. 60/310,908
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | NONAQUEOUS
ELECTROLYTES BASED ON ORGANOSILICON AMMONIUM DERIVATES FOR HIGH-ENERGY POWER SOURCES U.S.
Patent Application No. 10/126,340
| | --------------------------------------------------------------------------------------------------------------------------------------

| | SALTS OF ALKALI  METALS OF N, N'  DISUBSTITUTED  AMIDES OF ALKANE  SULFINIC  ACID AND  NONAQUEOUS
         ELECTROLYTES ON THEIR BASIS
U.S.         Patent Application No. 10/122,788
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | CATHODE
MATERIAL FOR LITHIUM BATTERY AND METHOD OF PRODUCTION THEREOF U.S. Patent Application No.
10/158,361
| | ------------------------------------------------------------------------------------------------------------

|TITLE                                     | PATENT FILING DATA                 | PCT FILING DATA       
|----------------------------------------- | ---------------------------------- | ----------------------
|Measurement Method of an Ionic            | Patent Application No. 2001128503  | PCT patent application
|Conductivity of Solid Electrolytes        | Filed 12/11/01                     | No. PCT/UA02/00043    
|                                          | Patent No. 45293A                  | Filed 09/ 05/02       
|                                          | Issued 03/15/02                   
|Secondary Lithium Chemical Power Source   | Patent Application No. 2001128504 
|with Non-aqueous Electrolyte              | Filed 12/11/01                     | Not filed             
|                                          | Patent No. 45294A                 
|                                          | Issued 03/15/02                   
|Method of Eddy-current Control of Powder  | Patent Application No. 2002129690  | PCT patent application
|Materials                                 | Filed 12/04/02                     | No. PCT/UA03/00022    
|                                          | Patent No. 54354A                  | Filed 06/27/03        
|                                          | Issued 02/17/03                   
|Method of Production of Active Cathode    | Patent Application No. 2003077001 
|Material for Lithium Secondary Power      | Filed 07/25/03                     | Not filed             
|Sources                                   | Patent No. 60953A                 
|                                          | Issued 10/15/03                   
|Carbon Material for Electrodes of         | Patent Application No. 2003077002  | PCT patent application
|Lithium-Ion Power Sources and Method of   | Filed 07/25/03                     | No. PCT/UA04/000049   
|Production Thereof                        | Approved 05/14/04                  | Filed 07/19/04        
|Method of Production of Active Cathode    | Patent Application No. 2003077003  | PCT patent application
|Material for Lithium Secondary Power      | Filed 07/25/03                     | No. PCT/UA04/000048   
|Sources                                   | Patent No. 67134                   | Filed 07/19/04        
|                                          | Issued 12/26/03                   
|Method of Lithium Batteries Production    | Patent Application No. 2003077004  | PCT patent application
|                                          | Filed 07/25/03                     | No. PCT/UA04/000050   
|                                          | Patent No. 67135                   | Filed 07/19/04        
|                                          | Issued 06/15/04                   
|Method of Non-Contact Measuring           | Patent Application No. 2003007005  | PCT patent application
|Electrical Conductivity of Electrolytes   | Filed 07/25/03                     | No. PCT/UA04/000051   
|with Using Primary  Measuring Transformer | Patent No. 60954A                  | Filed 07/19/04        
|                                          | Issued 10/15/03                   
|Method of Non-Contact Measuring           | Patent Application No. 2003077006  | PCT patent application
|Electrical Conductivity of Polymer        | Filed 07/25/03                     | No. PCT/UA04/000052   
|Electrolyte Thin Films with Using         | Patent No. 60955A                  | Filed 07/19/04        
|Combined Sensor                           | Issued 10/15/03                   
|Method of Non-Destructive Control of      | Patent Application No. 2003077007  | PCT patent application
|Hermiticity Based on Gas-Discharge        | Filed 07/25/03                     | No. PCT/UA04/000053   
|Visualization                             | Patent No. 64623                   | Filed 07/19/04        
|                                          | Issued 02/16/04                   
|Solid Inorganic Glassy Electrolyte and    | Patent Application No. 2003077008  | PCT patent application
|Method of Production Thereof              | Filed 07/25/03                     | No. PCT/UA04/000054   
|                                          | Patent No. 67973                   | Filed 07/19/04        
|                                          | Issued 07/15/04                   
|Method and Device for Rapid Charging      | Patent Application No. 20031110308 | PCT patent application
|Secondary Power Sources                   | Filed 11/14/03                     | No. PCT/UA04/000056   
|                                          | Patent No.67618                    | Filed 07/19/04        
|                                          | Issued 06/15/04                   
|Manganese Oxide for Lithium Battery       | Patent Application No. 20031212437 | PCT patent application
|Cathode                                   | Filed 12/25/03                     | No. PCT/UA04/000057   
|                                          |                                    | Filed 07/19/04        
|Method of Lithium Batteries Production    | Patent Application No. 20031213443
|                                          | Filed 12/31/03                     | Not filed             
|                                          | Approved 06/24/04