Document:

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Exhibit 10.5

                     INTER COMPANY LINE OF CREDIT AGREEMENT

         THIS INTER  COMPANY LINE OF CREDIT  AGREEMENT  dated  November 1, 2002,
("Effective Date") between ENER1, INC., (the "Lender"),  and ENER1 TECHNOLOGIES,
INC., (the "Borrower").

                                    ARTICLE I
                                    THE LOANS

         SECTION 1.1.               The Loans.

         (a)  Subject to the terms and  conditions  set forth  below,  and until
further  notice  from the  Lender  to the  Borrower,  the  Lender  hereby  makes
available to the  Borrower a line of credit for loans in an aggregate  amount of
up to $300,000 for twelve (12) months from the Effective Date ("Initial  Term").
In the event Borrower is unable to reach a positive cash flow within the Initial
Term, nor receive third party  financing  during the Initial Term,  Borrower may
borrow up to an  additional  $200,000  during the twelve (12) month period after
the Initial Term  ("Second  Term  Loan").  The Initial Term Loan and Second Term
Loan are collectively referred to as the "Loans".

         (b)  The  Borrower  may  borrow  the  Loans  in  one or  more  drawings
("Drawings").  Each  Drawing  shall be in an amount not less than  $100.00.  The
Borrower  shall  request  each  Drawing by notice to the  Lender at least  three
business  days  prior to the  Drawing.  If the  Lender  shall  elect to make the
requested  Loan, it shall do so on the date requested  (which must be a Business
Day Day) by  crediting  the amount of the Loan to the  Borrower's  current  bank
account.  Each notice of Drawing given by the Borrower to the Lender shall be in
the form  attached  as  Exhibit A and shall  constitute  a  confirmation  by the
Borrower that on the date of the Drawing its  representations and warranties set
forth in Article III below remain true and  correct.  Notice of Drawing from the
Borrower, once received by the Lender, shall be irrevocable.

         (c) Each Loan shall bear  interest  from the date of its Drawing  until
paid in full, at an interest rate per annum equal to six percent. From and after
the occurrence of an Event of Acceleration  described in Section 4.01 below, the
Loans  (and  any  past-due  amounts  of  principal,  interest  or  other  monies
hereunder) shall bear interest at a rate (the "Default Rate") equal to 1.5% over
the rate otherwise  applicable  hereunder until such Event of Acceleration shall
be cured.

                                   ARTICLE II
                                TERMS OF PAYMENT

         SECTION 2.1.               Prepayments.

         Borrower may prepay the Loans without penalty.

         SECTION 2.2.               Payments and Computations.

         (a) The Borrower  shall repay the Loans in equal  monthly  installments
over a five (5) year period commencing on the termination of the Initial Term.

         (b)  Principal,  interest  and other  amounts  payable by the  Borrower
hereunder  shall  be paid in  lawful  money  of the  United  States  (in  freely
transferable Dollars) to the Lender at its executive offices.

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         (c) Interest  hereunder  shall be payable on the basis of a year of 360
days and the actual number of days elapsed.

                                   ARTICLE III
                         REPRESENTATIONS AND WARRANTIES

         SECTION 3.1.  Representations  and Warranties.  To induce the Lender to
make the Loans, the Borrower represents and warrants that: (a) the Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Florida;  (b) the  Borrower  has taken all  corporate  and legal
action  necessary to authorize the execution,  delivery and  performance of this
Agreement;  (c) this Agreement constitutes a legal, valid and binding obligation
of the  Borrower  enforceable  in  accordance  with its  terms  in the  State of
Florida; and (d) the execution and delivery of this Agreement and the Borrower's
performance  of its  obligations  under  this  Agreement  will not  violate  any
provisions of the Borrower's Articles of Incorporation or By-laws, or any law or
regulation or agreement of any nature binding upon it or its property.

                                   ARTICLE IV
                             EVENTS OF ACCELERATION

         SECTION 4.1. Events of  Acceleration.  The following  shall  constitute
Events of  Acceleration  hereunder:  (a) the Borrower shall fail to pay when due
any principal of or interest on the Loans or any other amount payable hereunder,
and in the case of any amount  other than  principal  or  interest,  such amount
shall  remain  unpaid  for a period of at least 30 days after the date when due;
(b) the Borrower shall be in default in the due performance or observance of any
other term contained  herein for a period of 30 days after the Lender shall have
given the  Borrower  written or telex notice of such  default;  (c) the Borrower
shall  become  insolvent  or unable to pay its  debts as they  mature,  or shall
consent to the  appointment  of a trustee,  intervener or receiver for it or for
all or a substantial  part of its property,  or any such trustee,  intervener or
receiver  shall  be  appointed,  or  bankruptcy,  dissolution,   reorganization,
intervention,  arrangement or liquidation  proceedings  (or similar  proceedings
analogous in purpose or effect)  shall be instituted by the Borrower or any such
proceedings  instituted  against the Borrower shall not have been  discharged or
stayed within a period of 60 days from when instituted;  (d) any representation,
warranty or  statement,  made or  delivered to the Lender by or on behalf of the
Borrower in  connection  herewith  shall prove to be untrue or misleading in any
material respect; (e) the Borrower or its share holders shall take any steps for
the Borrower's  liquidation or winding-up;  (f) it shall become unlawful for the
Borrower or the Lender to perform any of its respective  obligations  hereunder;
(g) the  Borrower  shall  cease to carry on  business,  or  shall,  without  the
Lender's prior written consent, cause or permit any sale, transfer,  lien, lease
or encumbrance,  other than at arm's length and for new and fair  consideration,
of a significant  portion of the Borrower's  assets; or (h) any party giving any
collateral or security for the Borrower's  obligations  hereunder  shall default
under the terms of any agreement concerning such security or collateral.

         SECTION 4.2. If any of the foregoing Events of Acceleration shall occur
and be continuing,  then the Lender,  in its sole discretion,  from time to time
may: (a) by telex or written  notice to the Borrower  declare all or any portion
of the Loans, accrued interest thereon and all other amounts due hereunder to be
immediately due and payable, whereupon the same shall become immediately due and
payable without any other demand, presentment, notice or protest whatsoever, all
of which the Borrower hereby irrevocably waives; and/or (b) without prior notice
to the Borrower exercise any other right hereunder or available to the Lender at
law or in equity.

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                                    ARTICLE V
                                  MISCELLANEOUS

         SECTION 5.1.  Amendments.  Etc. No amendment or waiver of any provision
of this Agreement,  nor consent to any departure by the Borrower herefrom, shall
be  effective  unless the same shall be in writing  and signed by the Lender and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given.

         SECTION 5.2.  Costs and Expenses.  The Borrower shall pay all costs and
expenses in connection with the preparation,  execution, delivery, amendment and
enforcement of this Agreement,  including the reasonable fees and  out-of-pocket
expenses of counsel for the Lender with respect thereto.

         SECTION 5.3. Jurisdiction. The Borrower hereby irrevocably consents and
agrees  that any  action or  proceeding  arising  out of this  Agreement  may be
brought  against the  Borrower in any federal or state court  sitting in Broward
County,  Florida, and waives any objection which it may now or hereafter have to
the  laying of venue by any such  court in any such  action or  proceeding.  The
Borrower  also agrees that  service of process in any such action or  proceeding
shall be properly  served upon it if delivered  personally or sent by registered
airmail to the Borrower's address then registered on the Lender's books. Nothing
herein  shall  affect the  Lender's  right to serve  process in any other manner
permitted  by law or to bring  actions  or  proceedings  in any other  competent
jurisdiction.

         SECTION 5.4.  Notices.  Any notices  which may be given to either party
hereunder  shall be in writing  and, if  addressed  to the  Lender,  sent to the
offices of the Lender  located at 1601 Clint  Moore Road,  Boca  Raton,  Florida
33487, or to such other address as the Lender may hereafter  notify the Borrower
in  writing,  and if  addressed  to the  Borrower,  sent to the  address  of the
Borrower from time to time on the Lender's books. Any such notice,  if delivered
personally, by telex or telegram, shall be effective on the date when given, and
if sent by mail, shall be effective five Business Days after posting.

         SECTION 5.5.  Survival of Indemnities.  The indemnities of the Borrower
to the Lender under this Agreement shall survive repayment of the Loans.

         SECTION 5.6.  Binding  Effect:  Governing Law. This Agreement  shall be
binding  upon and inure to the benefit of the  Borrower and the Lender and their
respective successors and assigns.  Neither party may assign all or any part of,
or any interest in, the rights  hereunder and in the Loans,  without the written
consent of the other party.  This Agreement shall be governed by, and the rights
and  obligations  of the parties  construed in accordance  with, the laws of the
State of Florida.

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         IN WITNESS  WHEREOF,  the  Borrower  and the Lender  have  caused  this
Agreement to be executed  and  delivered in Broward  County,  Florida,  by their
respective  officers  thereunto  duly  authorized,  as of the date  first  above
written.

                                              ENER1, INC.

                                              By:/s/Larry L. Light
                                              Name:Larry L. Light
                                              Title:Chief Executive Officer

                                              ENER1 TECHNOLOGIES, INC.

                                              By:/s/R Michael Brewer
                                              Name: R Michael Brewer
                                              Title: Chief Financial Officer

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                                    EXHIBIT A

                          ===========================

Gentlemen:

         Please  credit  to  our  current   account  with  you   $__________  on
__________________, 200_.

                                            Sincerely,

                                            By:_____________________________
                                               Name:
                                               Title:

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Exhibit 10.6

                          TRANSITION SERVICES AGREEMENT

         THIS TRANSITION SERVICES AGREEMENT, dated as of __________,  2003 (this
"Agreement"),  is  made  by and  between  ENER1,  Inc.,  a  Florida  corporation
("Parent"), and ENER1 Technologies, Inc., a Florida corporation ("Spinco").

                                   WITNESSETH:

         WHEREAS,  Parent intends to "spin-off" to its shareholders  100% of the
capital stock of Spinco;

         WHEREAS,  in connection  with the  spin-off,  Parent and Spinco wish to
enter into this Agreement for purposes of continuity and transition; and

         WHEREAS,  Spinco  desires to cause  Parent to provide the  Services set
forth on Schedule A to Spinco, and Parent is willing to provide such Services;

         NOW,  THEREFORE,  the parties hereto,  in consideration of the premises
and the mutual covenants contained herein, agree as follows:

SECTION 1. SPECIFIC DEFINITIONS.

         In addition to the terms defined  elsewhere in this Agreement,  as used
in this Agreement,  the following  terms have the respective  meanings set forth
below:

         "Applicable  Rate" shall mean the rate of interest per annum  announced
from  time to time by Bank of  America  as its  prime  lending  rate plus 2% per
annum.

         "Bankruptcy  Event" with respect to a party shall mean the filing of an
involuntary  petition in  bankruptcy  or similar  proceeding  against such party
seeking  its  reorganization,  liquidation  or the  appointment  of a  receiver,
trustee or  liquidator  for it or for all or  substantially  all of its  assets,
whereupon such petition shall not be dismissed  within sixty (60) days after the
filing  thereof,  or if such party  shall (i) apply for or consent in writing to
the appointment of a receiver, trustee or liquidator of all or substantially all
of its assets,  (ii) file a voluntary petition or admit in writing its inability
to pay its debts as they become  due,  (iii) make a general  assignment  for the
benefit of creditors,  (iv) file a petition or an answer seeking  reorganization
or an  arrangement  with its creditors or take  advantage of any  insolvency law
with respect to itself as debtor,  or (v) file an answer  admitting the material
allegations  of a petition filed against it in any  bankruptcy,  reorganization,
insolvency proceedings or any similar proceedings.

         "Loss" shall mean all losses,  liabilities,  damages,  claims, demands,
judgments  or  settlements  of any  nature  or kind,  known or  unknown,  fixed,
accrued,  absolute or  contingent,  liquidated  or  unliquidated,  including all
reasonable costs and expenses (legal,  accounting or otherwise as such costs are
incurred) relating thereto.

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         "Parent Services" shall mean those transitional services to be provided
by Parent to Spinco set forth on Schedule A hereto to assist Spinco in operating
Spinco's business.

         "Person" shall mean any natural  person,  corporation,  business trust,
limited liability company, joint venture,  association,  company, partnership or
government, or any agency or political subdivision thereof.

         "Services" shall mean the Parent Services.

SECTION 2. SERVICES.

         Section  2.1  Services.  Parent  shall  provide to Spinco  each  Parent
Service for the term set forth  opposite the  description of such Parent Service
in Schedule A.  Additional  services may be provided to Spinco by Parent if such
arrangement is agreed to in writing and executed by Parent and Spinco.

         Section 2.2 Standard of Service.  In performing  the  Services,  Parent
shall provide  substantially the same level of service and use substantially the
same  degree  of care as its  personnel  provided  and  used in  providing  such
Services  prior to the date hereof,  subject in each case to any  provisions set
forth on Schedule A with respect to each such Service.

SECTION 3. LICENSES AND PERMITS.

         Each party  warrants  and  covenants  that all  duties and  obligations
(including  with  respect  to  Parent,  all  Parent  Services)  to be  performed
hereunder shall be performed in compliance with all material applicable federal,
state, provincial and local laws, rules and regulations. Each party shall obtain
and  maintain  all  material  permits,   approvals  and  licenses  necessary  or
appropriate  to perform its duties and  obligations  (including  with respect to
Parent,  the Parent  Services and with respect to Spinco,  the Spinco  Services)
hereunder  and shall at all times comply with the terms and  conditions  of such
permits, approvals and licenses.

SECTION 4. PAYMENT.

         Section 4.1 Service Fees. In consideration for the provision of each of
the  Parent  Services,  Spinco  shall pay to  Parent  the fee set forth for such
Parent Service on Schedule A.

         Section 4.2 Costs and  Expenses.  In  addition  to the fees  payable in
accordance with Section 4.1,  Spinco shall  reimburse  Parent for all reasonable
and  necessary  out-of-pocket  costs and expenses  (including  postage and other
delivery costs,  telephone,  telecopy and similar  expenses)  incurred by Parent
with  respect  to third  parties  in  connection  with the  provision  of Parent
Services to Spinco  pursuant to the terms of this Agreement or paid by Parent on
behalf of Spinco.

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         Section 4.3 Invoices.  Parent will invoice Spinco in U.S. dollars:  (i)
as of the last day of each  calendar  month  for any fees  payable  by Spinco in
accordance  with Section 4.1 for Parent  Services  listed on Schedule A provided
pursuant to the terms of this Agreement  during such month;  (ii) as of the last
day of each calendar month for any amounts  payable by Spinco in accordance with
Section  4.2(a) for any  out-of-pocket  costs and expenses  incurred  during the
immediately  preceding  month to the extent  Parent has received an invoice from
such third party;  and (iii) as of the last day of each  calendar  month for any
taxes  (excluding  income taxes) payable with respect to the provision of Parent
Services  to Spinco  during  such  month.  Parent  shall  deliver or cause to be
delivered to Spinco each such invoice within thirty (30) days following the last
day of the calendar month to which such invoice  relates.  Spinco shall pay each
such invoice  received by electronic  funds transfer  within thirty (30) days of
the date on which such invoice was received.

         Section 4.4 Late Payment. Any amount not paid when due shall be subject
to a late payment fee  computed  daily at a rate equal to the  Applicable  Rate.
Notwithstanding the foregoing,  in the event Spinco disputes the accuracy of any
invoice,  Spinco  shall pay the  undisputed  portion of such  invoice a provided
herein,  and the  parties  hereto  will  promptly  meet and seek to resolve  the
disputed  amount  of the  invoice.  Spinco  agrees  to pay  Parent's  reasonable
attorneys'  fees and other costs  incurred in  collection of any amounts owed to
Parent hereunder and not paid when due. Notwithstanding anything to the contrary
contained  herein,  in the  event  Spinco  fails  to  make a  payment  when  due
hereunder, and such failure continues for a period of thirty (30) days following
delivery  of written  notice to Spinco of such  failure,  Parent  shall have the
right to cease  provision of Services to Spinco until such overdue  payment (and
any applicable  late payment fee accrued with respect  thereto) is paid in full.
Such right of Parent shall not in any manner limit or prejudice  any of Parent's
other rights or remedies in the event of Spinco's  failure to make payments when
due hereunder, including any rights or remedies pursuant to Section 7.

         Section  4.5 Fees  Upon  Termination  of  Services.  In the  event of a
termination  of Services  pursuant to Section 7.1,  with respect to the calendar
month in which such Services cease to be provided,  Spinco shall be obligated to
pay a pro rata share of the fee for such Service set forth on Schedule A , equal
to the  product  of (x) the fee set  forth on  Schedule  A  multiplied  by (y) a
fraction,  the numerator of which is the number of days in the calendar month in
which such Services  cease to be provided  preceding and including the last date
on which such Services are provided, and the denominator of which is 30.

SECTION 5. INDEMNIFICATION.

         Section 5.1  Indemnification by Principal.  Spinco agrees to indemnify,
defend and hold Parent  harmless  from and against any Loss to which  Parent may
become subject  arising out of, by reason of or otherwise in connection with the
provision  hereunder by Parent of Parent  Services,  other than Losses resulting
from Parent's gross  negligence,  willful  misconduct or material  breach of its
obligations  pursuant to this Agreement.  Notwithstanding  any provision in this
Agreement to the contrary, Spinco shall not be liable under this Section 5.1 for
any consequential, special or punitive damages (including lost profits).

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         Section 5.2  Indemnification  by Provider.  Parent agrees to indemnify,
defend and hold Spinco  harmless  from and against any Loss to which  Spinco may
become subject  arising out of, by reason of or otherwise in connection with the
provision  hereunder  by Parent of Parent  Services to Spinco  where such Losses
resulted from Parent's gross negligence,  willful  misconduct or material breach
of its obligations pursuant to this Agreement.

SECTION 6. CONFIDENTIALITY.

         Each party shall keep  confidential the Schedules to this Agreement and
all information received from the other party regarding the Services,  including
any  information  received  with  respect to Parent or  Spinco,  and to use such
information  only for the purposes set forth in this Agreement  unless otherwise
agreed to in writing by the party from which such  information was received.  In
the event a party is required by any court or legislative or administrative body
(by oral  questions,  interrogatories,  requests for  information  or documents,
subpoena,  civil  investigation  demand or  similar  process)  to  disclose  any
confidential  information  provided pursuant to this Agreement,  the party shall
provide  the other  party with  prompt  notice of such  requirement  in order to
afford the other party an opportunity to seek an appropriate protective order or
other remedy.  However,  if the other party is unable to obtain or does not seek
such  protective  order and the party  required  to  disclose  the  confidential
information  is, in the opinion of its  counsel,  legally  compelled to disclose
such  confidential  information,  disclosure  of  such  information  may be made
without  liability under this  Agreement.  The covenants in this Section 6 shall
survive  any  termination  of  this  Agreement   indefinitely  with  respect  to
information  qualifying as a trade secret under  applicable law and for a period
of three (3) years from the date such termination becomes effective with respect
to all other information.

SECTION 7. TERM.

         Section 7.1       Duration.

                  (a) Subject to Sections 6, 7.2,  7.3 and 7.4, the term of this
Agreement shall commence on the date hereof and shall continue in full force and
effect  with  respect  to each  Service  until  the  earlier  of (i)  the  first
anniversary of the effective date of the spin-off contemplated hereunder or (ii)
the termination of such Service in accordance with Section 7.1(b).

                  (b) Each party acknowledges that the purpose of this Agreement
is for Parent to provide the Parent Services to Spinco on an interim basis until
Spinco can perform the Parent Services for itself. Accordingly, Spinco shall use
its commercially  reasonable  efforts to make or obtain such approvals,  permits
and licenses and implement such systems, as shall be necessary for it to provide
the  appropriate  Services  for itself as  promptly  as  practicable.  As Spinco
becomes  self-sufficient or engages other sources to provide any Parent Service,
Spinco  shall be entitled to release  Parent  from  providing  any or all of the
Parent  Services  hereunder by delivering a written  notice thereof to Parent at
least  thirty  (30) days prior to the  effective  date of release of such Parent
Service(s). At the end of such thirty (30) day period (or such shorter period as
may be agreed by the  parties),  Parent shall  discontinue  the provision of the
Parent  Services  specified in such notice and any such Parent Services shall be
excluded  from this  Agreement,  and  Schedule  A shall be deemed to be  amended
accordingly.

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         Section 7.2 Early  Termination  by Parent.  Parent may  terminate  this
Agreement by giving written notice to Spinco under the following circumstances:

                  (a) if Spinco shall default in the  performance  of any of its
material  obligations  under, or breach any of its warranties set forth in, this
Agreement,  and such default or breach shall  continue and not be remedied for a
period of thirty  (30) days  after  Parent  has given  written  notice to Spinco
specifying such default or breach and requiring it to be remedied;

                  (b) if a Bankruptcy Event has occurred with respect to Spinco;
or

                  (c) upon the occurrence of a Change in Control of Spinco.

         Section 7.3 Early  Termination  by Spinco.  Spinco may  terminate  this
Agreement by giving written notice to Parent under the following circumstances:

                  (a) if Parent shall default in the  performance  of any of its
material  obligations  under, or breach any of its warranties set forth in, this
Agreement  and such default or breach  shall  continue and not be remedied for a
period of thirty  (30) days  after  Spinco  has given  written  notice to Parent
specifying such default or breach and requiring it to be remedied;

                  (b) if a Bankruptcy Event has occurred with respect to Parent;
or

                  (c) upon the occurrence of a Change in Control of Parent.

         Section 7.4 Force  Majeure.  In the event the  performance by Spinco or
Parent of their  respective  duties or  obligations  hereunder is interrupted or
interfered with by reason of any cause beyond its reasonable control,  including
fire,  storm,  flood,  earthquake,  explosion,  war, strike or labor disruption,
rebellion,  insurrection,  quarantine, act of God, boycott, embargo, shortage or
unavailability  of supplies,  riot,  or  governmental  law,  regulation or edict
(collectively,  the Force  Majeure  Events),  the party  affected  by such Force
Majeure  Event shall not be deemed to be in default of this  Agreement by reason
of its  nonperformance  due to such Force Majeure  Event,  but shall give prompt
written notice to the other party of the Force Majeure Event. The party affected
by the Force Majeure Event shall cooperate with the other party in obtaining, at
the other party's sole expense, an alternative source for the affected Services,
and the other party shall be released  from any payment  obligation to the party
affected by the Force  Majeure  Event with respect to such  Services  during the
period of such Force Majeure Event. Additionally, upon and during the occurrence
of a Force Majeure Event, at the sole option of the party receiving the Services
affected by the Force Majeure Event,  the term of this Agreement shall be tolled
with respect to any Services that are not being provided by a third party.

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         Section 7.5  Consequences on  Termination.  In the event this Agreement
expires  or is  terminated  in  accordance  with  this  Section  7, then (a) all
Services to be provided will promptly cease, (b) each of Parent and Spinco shall
promptly return all  confidential  information  received from the other party in
connection with this Agreement (including the return of all information received
with respect to the Services of Parent or Spinco,  as the case may be),  without
retaining  a copy  thereof,  and (c) each of Parent and Spinco  shall  honor all
credits and make any  accrued and unpaid  payment to the other party as required
pursuant to the terms of this Agreement, and no rights already accrued hereunder
shall be affected.

SECTION 8. RECORDS.

         Each of the parties  shall  create  and,  for a period of six (6) years
after  the  termination  or  expiration  of this  Agreement,  maintain  full and
accurate books in connection  with the provision of the Services,  and all other
records  relevant to this Agreement,  and upon reasonable  notice from the other
party shall make  available for inspection and copy by such other party's agents
such records during reasonable business hours.

SECTION 9. DISPUTE RESOLUTION.

         Section  9.1  Dispute  Resolution  under  Distribution  Agreement.  Any
dispute arising out of or relating to the performance,  breach or interpretation
of this  Agreement  shall be  arbitrated  in  accordance  with the  rules of the
American Arbitration Association.

         Section 9.2  Continuity of Service and  Performance.  Unless  otherwise
agreed herein or in writing,  the parties will continue to provide  Services and
honor all other  commitments  under this Agreement  during the course of dispute
resolution  pursuant to the  provisions  of this  Section 9 with  respect to all
matters not subject to such dispute, controversy or claim.

SECTION 10. NOTICES.

         All notices  and other  communications  hereunder  shall be in writing,
shall  reference  this  Agreement  and  shall be hand  delivered  or  mailed  by
registered or certified mail (return receipt  requested) or sent by any means of
electronic message  transmission with delivery confirmed (by voice or otherwise)
to the parties at the  following  addresses  (or at such other  addresses  for a
party as shall be specified by like notice) and will be deemed given on the date
on which such notice is received:

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         To Parent:

         ENER1, Inc.
         c/o Ener1 Group, Inc.
         550 W. Cypress Creek Rd., Suite 550
         Ft. Lauderdale, FL 33309
         Attention: Larry Light, President
         Telephone: (561) 212-9826
         Facsimile: (954) 229-7595

         To Spinco:

         ENER1 Technologies, Inc.
         550 W. Cypress Creek Rd., Suite 550
         Ft. Lauderdale, FL 33309
         Attention: Mike Zoi, President
         Telephone: (954) 202-4442
         Facsimile: (954) 202-2884

SECTION 11. MISCELLANEOUS.

         Section 11.1 Waivers, Modifications,  Amendments. Any provision of this
Agreement may be amended or waived if, and only if, such  amendment or waiver is
in writing and signed, in the case of an amendment,  by Spinco, on the one hand,
and Parent,  on the other hand, or in the case of a waiver, by the party against
whom the  waiver  is to be  effective.  No  failure  or  delay  by any  party in
exercising  any right,  power or privilege  hereunder  shall operate as a waiver
thereof nor shall any single or partial  exercise  thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies  herein  provided shall be cumulative and in addition to
other or further remedies provided by law or equity.

         Section 11.2  Governing  Law. THIS  AGREEMENT  SHALL BE GOVERNED BY AND
CONSTRUED  IN  ACCORDANCE  WITH THE LAWS OF THE STATE OF FLORIDA  APPLICABLE  TO
CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF FLORIDA.

         Section 11.3  Severability.  The provisions of this Agreement  shall be
deemed severable and the invalidity or  unenforceability  of any provision shall
not affect the validity or enforceability of the other provisions hereof. If any
provision  of  this  Agreement,  or  the  application  thereof  to  any  person,
corporation,  partnership  or other entity or any  circumstance,  is invalid and
unenforceable,  (a) a suitable  and  equitable  provision  shall be  substituted
therefor  in order to carry  out,  so far as may be valid and  enforceable,  the
intent  and  purpose  of such  invalid or  unenforceable  provision  and (b) the
remainder  of this  Agreement  and the  application  of such  provision to other
persons, corporations, partnerships or other entities or circumstances shall not
be affected by such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision, or the
application thereof, in any jurisdiction.

                                       7
<PAGE>

         Section 11.4 Reference; Interpretation. References in this Agreement to
any gender  include  references to all genders,  and  references to the singular
include references to the plural and vice versa. The words include, includes and
including  when used in this  Agreement  shall be deemed to be  followed  by the
phrase without limitation.  Unless the context otherwise requires, references in
this Agreement to Sections and Schedules shall be deemed  references to Sections
of, and Schedules to, this Agreement. Unless the context otherwise requires, the
words hereof,  hereby and herein and words of similar  meaning when used in this
Agreement  refer to this  Agreement in its  entirety  and not to any  particular
Section or provision of this  Agreement.  This Agreement  shall not be construed
against either party as the principal drafter hereof.

         Section 11.5 Entire Agreement.  This Agreement (including all Schedules
hereto) contains the entire agreement between the parties hereto with respect to
the  subject   matter   hereof  and   supersedes   all  prior   agreements   and
understandings, oral or written, with respect to such matters.

         Section 11.6  Assignment.  Neither  Parent nor Spinco may,  directly or
indirectly,  assign or subcontract, or attempt to assign or subcontract,  any of
its rights or obligations hereunder, in whole or in part, by operation of law or
otherwise,  except with the prior written  consent of the other party;  it being
understood  that such consent  shall not be  unreasonably  withheld if Parent or
Spinco assigns or  subcontracts  the Agreement to one of its affiliates with the
financial and other resources and expertise to perform all of the obligations of
such party hereunder.  Any attempted  assignment or delegation not in compliance
with the  forgoing  shall be null and void and of no effect.  Nothing  contained
herein  shall  prevent  a party  from  providing  Services  through  or with the
assistance  of third  parties  whom such party  regularly  used to provide  such
Services prior to the date hereof.

         Section 11.7 Binding  Effect.  This Agreement shall be binding upon the
parties hereto and their respective  successors and permitted  assigns,  if any,
and except as provided herein,  shall inure to the benefit of the parties hereto
and their respective successors and permitted assigns, if any.

         Section 11.8  Counterparts.  This  Agreement  may be executed in one or
more counterparts,  each of which shall be deemed an original,  and all of which
shall constitute one and the same Agreement.

         Section 11.9 No Agency or  Partnership.  Nothing in this Agreement will
create,  or will be deemed to  create,  a  partnership  or the  relationship  of
principal and agent or of employer and employee between the parties.

                            [Signature page follows.]

                                       8
<PAGE>

         IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
on behalf of the parties, effective as of the date first herein above written.

ENER1, INC.

By:/s/Larry L. Light
Name: Larry L. Light
Title:President and CEO

ENER1 TECHNOLOGIES, INC.

By:/s/ R. Michael Brewer
Name: R. Michael Brewer
Title: CFO

                                       9
<PAGE>

                                   SCHEDULE A

                                SERVICES AND FEES

TYPE OF SERVICES                                       FEES

Accounting Services                                    $50/hour to $250/hour

Facilities Management Services                         $50/hour to $250/hour

Technical Support Services                             $50/hour to $250/hour

Contracts Administration Services                      $50/hour to $250/hour

                                       10
<PAGE>

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