<HTML>
<HEAD>
<TITLE>Form S-8 for Ener1, Inc.</TITLE>
</HEAD>
<BODY>



<!-- MARKER FORMAT-SHEET="Head Right-TNR" FSL="Default" -->
<A NAME=A001></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Registration No. &#151; </FONT></P>

<!-- MARKER FORMAT-SHEET="Page Rule Double" FSL="Default" -->
<HR ALIGN=LEFT WIDTH=100% SIZE=4 NOSHADE>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A002></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECURITIES AND
EXCHANGE COMMISSION <BR>Washington, D.C. 20549 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A004></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FORM S-8 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A005></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>REGISTRATION STATEMENT <BR>
UNDER <BR>THE SECURITIES ACT OF
1933 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A008></A>
<p ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>ENER1, INC.</B><BR>(Exact Name of
Registrant as Specified in Its Charter) </FONT></P>







<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">

<TR VALIGN="TOP" align=center>
     <TD WIDTH="30%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>Florida</B>    <BR>
(State or Other<BR>
Jurisdiction of<BR>
Incorporation or<BR>
Organization)
</FONT></TD>
     <TD WIDTH="37%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>550 W. Cypress Creek Rd., Suite 120 </B><BR><BR>
<B>Ft. Lauderdale, FL 33309</B><BR><BR>(Address of Principal Executive Offices Including Zip Code)</FONT></TD>
     <TD WIDTH="33%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>59-2479377</B><BR>
(I.R.S. Employer<BR>
Identification No.)
</FONT></TD></TR>
</TABLE>


<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A010></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>KEVIN P. FITZGERALD
EMPLOYMENT AGREEMENT<BR>RONALD STEWART STOCK
AWARD AGREEMENT <BR>LARRY L. LIGHT STOCK
AWARD AGREEMENT <BR>KARL GRUNS INVESTMENT
AGREEMENT <BR>ALLA ROZENGURT STOCK
OPTION AGREEMENT <BR>BYRON BUNTIN STOCK
OPTION AGREEMENT <BR>OLGA MORKOVINA STOCK
OPTION AGREEMENT <BR>SERGEY KAPLAN STOCK
OPTION AGREEMENT </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Default" -->
<A NAME=A018></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(Full Title of the Plan) </FONT></P>

<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>





<TABLE WIDTH=600 BORDER="0" CELLPADDING="0" CELLSPACING="0" align=center>
<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Ronald Stewart<BR>
General Counsel<BR>
Ener1, Inc.<BR>
550 W. Cypress Creek Rd., Suite 120,<BR>
Ft. Lauderdale, FL 33309</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Copies to:<BR>
Stephen I. Glover, Esq.<BR>
Gibson, Dunn &amp; Crutcher LLP<BR>
1050 Connecticut Avenue, N.W.<BR>
Washington, D.C. 20036<BR>
(202) 955-8500</FONT></TH></TR>
<TR VALIGN="TOP" align=center>
     <TD WIDTH="34%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
     <TD WIDTH="33%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">(Name and Address of Agent <BR>For Service)
</FONT></TD>
     <TD WIDTH="33%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD></TR>
</TABLE>




<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A019></A>
<p ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>(954) 202-4442</B> <BR>(Telephone Number,
Including Area Code, of Agent For Service) </FONT></P>

<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Default" -->
<A NAME=A021></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CALCULATION OF
REGISTRATION FEE </FONT></H1>


<TABLE WIDTH=600 BORDER="0" CELLPADDING="4" CELLSPACING="0" align=center>
<TR VALIGN="BOTTOM">
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Title of Securities<BR>
to be Registered</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Amount to be<BR>
Registered(1)
</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Proposed Maximum<BR>
Offering Price<BR>
Per Share(2)</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Proposed Maximum<BR>
Aggregate<BR>
Offering Price(2)</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Amount of<BR>
Registration Fee(3)</FONT></TH></TR>
<TR VALIGN="TOP" align=center>
     <TD WIDTH="20%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Common Stock, par value
$.01 per share
</FONT></TD>
     <TD WIDTH="20%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">1,030,000 shares</FONT></TD>
     <TD WIDTH="20%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$ 1.14
</FONT></TD>
     <TD WIDTH="20%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$ 1,174,200
</FONT></TD>
     <TD WIDTH="20%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">$ 148.77
</FONT></TD></TR>
</TABLE><BR>


<!-- MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Workstation" -->
          <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
               <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(1) </FONT></TD>
               <TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Includes 300,000 shares of common stock of Ener1, Inc. (the &#147;Registrant or
               the &#147;Company&#148;) issued pursuant to a stock grant made by the Company to
               its director and Chief Executive Officer, Kevin P. Fitzgerald, in accordance with the Employment Agreement between
               the Company and Mr. Fitzgerald dated as of September 8, 2003 (the
               &#147;Fitzgerald Employment Agreement&#148;). Also includes 300,000 shares
               issued by the Company to its director, Executive Vice President, General Counsel
               and Secretary, Ronald Stewart, as
               partial compensation for his services in accordance with the Stock Award
               Agreement between the Company and Mr. Stewart dated as of May 16, 2003 (the
               &#147;Stewart Award Agreement&#148;). Also includes 100,000 shares issued by the
               Company to Larry L. Light, the Chief Executive Officer of a Company affiliate,
               EnerLook Solutions, Inc., as partial compensation for his services in accordance
               with the Stock Award Agreement between the Company and Mr. Light dated as of May
               16, 2003 (the &#147;Light Award Agreement&#148;). Also includes 50,000 shares
               issued by the Company to one of its directors, Karl Gruns, as partial
               compensation for his services in accordance with the Investment Agreement
               between the Company and Mr. Gruns dated as of January 1, 2003 (the &#147;Gruns
               Award Agreement&#148;). Also includes an aggregate of 280,000 shares of common
               stock issued to Alla Rozengurt, Byron Buntin, Olga Morkovina and Sergey Kaplan
               upon exercise of stock options granted under the Company&#146;s 2002 Stock
               Participation Plan (the &#147;Stock Option Agreements&#148;). Each of the
               Fitzgerald Employment Agreement and the Stewart, Light and Gruns Award
               Agreements and the Stock Option Agreements qualifies as an Employee Benefit Plan
               as defined under Rule 405 of Regulation C. </FONT></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Workstation" -->
          <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
               <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(2) </FONT></TD>
               <TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               Estimated solely for the purpose of calculating the registration fee. </FONT></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Default" -->
          <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
               <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(3) </FONT></TD>
               <TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               The registration fee has been calculated in accordance with Rule 457(h) under
               the Securities Act of 1933. </FONT></TD>
               </TR>
               </TABLE>
               <BR>


<P ALIGN=CENTER>1 </P>


<!-- MARKER PAGE="sheet: 1; page: 1" -->
<HR SIZE=3 COLOR=GRAY NOSHADE>



<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A022></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Explanatory Note </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ener1
has prepared this Registration Statement in accordance with the requirements of
Form&nbsp;S-8 under the Securities Act to register shares of its Common Stock (the
&#147;Shares&#148;), issued or issuable to some of its directors, executive officers and
employees (the &#147;Selling Stockholders&#148;), as compensation for their services to
Ener1. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Registration Statement contains two parts. The first part contains a prospectus prepared
in accordance with Part&nbsp;I of Form&nbsp;S-8 (in accordance with Instruction C of the
General Instructions to Form&nbsp;S-8) which covers reoffers and resales of shares of the
Shares issued to the Selling Stockholders as compensation for their services. The second
part contains information required in the Registration Statement pursuant to Part&nbsp;II
of Form&nbsp;S-8. Information required by Part&nbsp;I of Form&nbsp;S-8 is omitted from
this Registration Statement in accordance with Rule&nbsp;428 under the Securities Act and
the &#147;Note&#148; to Part&nbsp;I of Form&nbsp;S-8. </FONT></P>








<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A023></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Reoffer Prospectus </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A024></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1,030,000 Shares of
Common Stock of <BR>Ener1,&nbsp;Inc. </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
shares of common stock, $0.01 par value per share (the &#147;Shares&#148;), of
Ener1,&nbsp;Inc. (&#147;Ener1&#148;) covered by this reoffer prospectus, may be offered
and sold to the public from time to time by the selling stockholders named in this
prospectus (the &#147;Selling Stockholders&#148;). The Shares have been issued, or are
issuable to, the Selling Stockholders as compensation for their services to Ener1. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Selling Stockholders may sell Shares directly or indirectly in one or more transactions on
any stock exchange or stock market on which the Shares may be listed at the time of sale,
in privately negotiated transactions, or through a combination of such methods. These
sales may be at fixed prices (which may be changed), at market prices prevailing at the
time of sale, at prices related to such prevailing market prices or at negotiated prices. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
reoffer prospectus has been prepared for the purpose of registering the Shares under the
Securities Act of 1933, as amended (the &#147;Securities Act&#148;) to allow for future
sales by the Selling Stockholders to the public. The Selling Stockholders may sell Shares
through one or more agents, brokers or dealers or directly to purchasers. Ener1 will not
receive any proceeds from the sale of the shares by the Selling Stockholders. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
investment involves a high degree of risk. Please see &#147;Risk Factors&#148; beginning
on page&nbsp;4. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Neither
the Securities and Exchange Commission nor any state securities commission has approved or
disapproved of these securities or determined whether this reoffer prospectus is truthful
or complete. Any representation to the contrary is a criminal offense.</B> </FONT></P>



<P ALIGN=CENTER>2 </P>
<!-- MARKER PAGE="sheet: 3; page: 3" -->
<HR SIZE=3 COLOR=GRAY NOSHADE>



<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Default" -->
<A NAME=A026></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Table of Contents </FONT></H1>




<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="550">
<TR VALIGN=Bottom align=center>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT>&nbsp;</TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT>Page #s</TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="80%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="20%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Additional Information</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Incorporation of Certain Documents by Reference</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Company</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Risk Factors</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Use of Proceeds</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Selling Stockholders</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Plan of Distribution</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Legal Matters</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>16&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Experts</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>16&nbsp;</FONT></TD></TR>
</TABLE>


<BR><BR>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You
should rely only on the information contained in this reoffer prospectus or any
supplement. Ener1 has not authorized anyone to provide you with information different from
that which is contained in or incorporated by reference in this reoffer prospectus. The
Selling Stockholders are offering to sell shares of common stock and seeking offers to buy
shares of common stock only in jurisdictions where offers and sales are permitted. The
information contained in this reoffer prospectus is accurate only as of the date of this
reoffer prospectus, regardless of the time of delivery of this reoffer prospectus or of
any sale of the Shares. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A027></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Additional Information </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ener1
has filed with the U.S. Securities and Exchange Commission (the &#147;SEC&#148;) a
registration statement on Form&nbsp;S-8 under the Securities Act with respect to the
Shares offered by this reoffer prospectus. This reoffer prospectus does not contain all of
the information set forth in the registration statement and the exhibits to the
registration statement. For further information with respect to Ener1 and the Shares
offered by this reoffer prospectus, you should read the registration statement and the
exhibits to the registration statement. Statements contained in this reoffer prospectus
regarding the contents of any contract or any other document to which reference is made
are not necessarily complete. In each instance where a copy of such contract or other
document has been filed as an exhibit to the registration statement, reference is made to
the copy so filed and each statement is qualified in all respects by such reference. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ener1
is subject to the informational requirements of the Securities Exchange Act of 1934, as
amended (the &#147;Exchange Act&#148;), and, as required by the Exchange Act, files
reports and other information with the SEC. The registration statement, including
exhibits, and the reports and other information filed by Ener1 can be inspected without
charge at the public reference facilities maintained by the SEC at the SEC&#146;s
principal office at 450 Fifth Street, N.W., Room 1024, Washington, D.C., 20549. Copies of
this material can be obtained from the SEC at fees prescribed by the SEC. You may obtain
information on the operation of the Public Reference room by calling the SEC at
1-800-SEC-0330. The SEC maintains a World Wide Web site that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the SEC. The address of this site is <I>http://www.sec.gov</I>. In
addition, Ener1 makes copies of its electronic filings with the SEC available on the
investor relations portion of its web site at www.ener1.com. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A028></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Company </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ener1
develops and markets technologies and products related to lithium batteries, fuel cells
and solar cells. Our goal is to be the technology leader in both lithium batteries and
fuel cells. We are developing samples of products and components of lithium batteries
based on our proprietary technologies, as well as technologies, materials and prototypes
for new types of fuel cells and solar cells. We have 11 full-time scientists in our Ft. Lauderdale
facility and 18 full-time and 36 part-time scientists at our facilities in the Ukraine performing
research and development work related to our lithium battery, fuel cell and solar cell
technologies and products. </FONT></P>


<P ALIGN=CENTER>3 </P>

<HR SIZE=3 COLOR=GRAY NOSHADE>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
plan to produce fuel cell prototypes using our proprietary fuel cell technology. If the prototypes are successful, we
would then establish a pilot scale, fuel cell production facility. The pilot scale
production facility will be used for continued research and development and manufacturing
selected high margin fuel cell components. We believe our fuel cell technologies will
enable us to produce fuel cells which have an extended working life, use fuel more
efficiently, have higher mass and volume specific energy characteristics and a lower
$/kilowatt cost than those currently on the market. We recently filed a U.S. patent
application for a new electrochemical generator based on a hydrogen-air fuel cell. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have numerous patents, both issued and pending, for lithium battery-related technologies,
products, processes and components. We have built a lithium battery manufacturing plant
and laboratory facility in Ft. Lauderdale, Florida and own the associated land and
building. The facility is equipped with three production lines including a pilot line
for prototypes. We plan to begin battery production at the end of 2004.&nbsp; In 2003, we formed a joint
venture company named EnerStruct, Inc. with ITOCHU Corporation of Japan, to which we and
ITOCHU have licensed certain of our lithium battery technologies for use in Japanese
markets. ITOCHU invested $3.5 million in our company in July of 2003. We invested $2
million of this amount in EnerStruct and own 49% of EnerStruct. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to our lithium battery and fuel cell business, we have been developing and
marketing technologies for products and services to neutralize the harmful effects of
electromagnetic fields in electric power transmission lines and related equipment, through
our Ener1 Technologies, Inc. subsidiary. We also own approximately 49% of EnerLook
Solutions, Inc., which develops and markets turn-key video-on-demand and interactive
TV-based information and communications systems to customers in the health care and
hospitality industries. Until May 2003, we conducted this business primarily through our
former Digital Media Technologies Division; today, we conduct this business through
EnerLook Solutions, Inc. </FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In January 2004,
we issued $20 million in aggregate principal amount of our 5% Senior Secured Convertible Debentures due 2009 and
warrants to purchase 16 million shares of our common stock in a private placement. We expect to use the proceeds of
this offering to fund the development of our lithium battery and fuel cell products.</FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
were founded in 1985 as Boca Research, Inc., a Florida corporation, to market
communications software and data communications, I/O, multiport, and video products. In
October 2000, we changed our name to Inprimis, Inc. October 2001, we began to sell
products based on our video-on-demand and interactive TV systems to solution providers in
the hospitality and healthcare markets and other markets. In January 2002, Ener1 Group,
Inc. acquired a majority interest in our company and now owns approximately 93% of the our
common stock. We further diversified our business in September 2002, when we acquired
Ener1 Battery Company, from Ener1 Group, Inc. Following this acquisition, we changed our
name to Ener1, Inc. </FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our executive offices are located at 550 W. Cypress Creek Rd., Suite 120, Fort Lauderdale, FL 33309 and our phone number is
(954) 202-4442. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A029></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>RISK FACTORS </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>An
investment in our common stock involves a high degree of risk. You should carefully
consider the risks described below, as well as other information contained in this
prospectus, before investing in our common stock. Additional risks and uncertainties not
presently known to us or that we currently deem immaterial may also affect our business
operations. If any of these risks occur, our business could suffer, the market price of
our common stock could decline and you could lose all or part of your investment in our
common stock. This section includes or refers to forward-looking statements. You should
refer to the explanation of the qualifications and limitations on forward-looking
statements discussed on page 14.</I> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<A NAME=A030></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Risks Related to Our
Business </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
have a history of operating losses and we may not be able to continue as a going concern.</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have experienced net operating losses since 1997, incurred negative cash flows from
operations since 1999 and, as of September 30, 2003, had an accumulated deficit of $54.7
million. Cash used in operations for the years ended December 31, 1999, 2000, 2001 and
2002 was $6.1 million, $8.2 million, $6.2 million and $6.5 million, respectively. We had
negative cash flows from operations of $4.2 million for the nine months ended September
30, 2003. We expect that we will continue to incur negative cash flows and require
additional cash to fund our operations and implement our business plan. The continued
development of our energy-related technology and products will require significant
additional capital investment. Our financial statements have been prepared assuming that
we will continue as a going concern. However, the auditor&#146;s reports on our financial
statements state that there is substantial doubt about our ability to continue as a going
concern. </FONT></P>


<P ALIGN=CENTER>4 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>




<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>The terms of our
5% Senior Secured Convertible Debentures restrict our operations.</B></FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our 5% senior secured
convertible debentures contain restrictive covenants that limit our ability to, among other things:</FONT></P>


<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">

<TR VALIGN="TOP">
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">o<BR>
o<BR>
o<BR>
o<BR>
o<BR>
o
</FONT></TD>
     <TD WIDTH="90%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">dispose of assets;<BR>
incur debt;<BR>
pay dividends;<BR>
repurchase our capital stock and debt securities;<BR>
create liens on our assets; and<BR>
engage in transactions with our affiliates.
</FONT></TD></TR>
</TABLE><BR>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">These covenants may significantly limit our ability
to respond to changing business and economic conditions and to secure additional financing, and we may be
prevented from engaging in transactions that might be considered important to our business strategy or otherwise
beneficial to us.</FONT><P>




<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
may never complete the research and development of commercially viable products. &nbsp;</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although
we have conducted other business activities in the past, we have only recently reorganized
our activities to focus on the development of energy and battery related products. We do
not know when or whether we will successfully complete research and development of
commercially viable energy products. If we are unable to develop commercially viable
products, we will not be able to generate sufficient revenue to become profitable. The
commercialization of our products depends on our ability to control the costs of
manufacturing, and we cannot assure you that we will be able to sufficiently control these
costs. We must complete substantial additional research and development before we will be
able to manufacture a commercially viable battery products in commercial quantities In
addition, while we are conducting tests to predict the overall life of our products, we
may not have tested our products over their projected useful life prior to large-scale
commercialization. As a result, we cannot be sure that our products will last as long as
predicted, and, if they do not, we may incur liability under warranty claims. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
have only recently acquired our energy business, and your basis for evaluating us is
limited. &nbsp;</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
acquired our energy products business in September, 2002. Accordingly, there is
only a limited basis upon which you can evaluate our business and prospects. We have an
unproven business plan and do not expect to be profitable for the next few years.
During the past two years, we have shifted our business from providing engineering
services and interactive products to focus primarily on developing technologies and
products for the battery and fuel cell industries. Before investing in our
securities, you should consider the challenges, expenses and difficulties that we will
face as a development stage company seeking to develop and manufacture new products. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Viable
markets for our products may never develop, may take longer to develop than we anticipate
or may not be sustainable. &nbsp;</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
energy products and technologies target emerging markets, and we do not know the extent to
which our technologies and products will be accepted. To date we do not have any
commercially viable products. We must be able to develop a commercially viable product for
our business to succeed. If a viable market fails to develop or develops more slowly than
we anticipate, we may be unable to recover the losses we will have incurred to develop our
products and may be unable to achieve profitability. Our target customers for our battery
products include customers in the Department of Defense and military forces and in the
transportation, medical and other industries. We also plan to license our technologies for
others to use to manufacture battery products for the consumer product sector. Our target
fuel cell customers include automobile companies and other companies to whom we would
license our fuel cell technologies for use in manufacturing fuel cell products and
systems. We will need to develop or acquire adequate marketing and manufacturing
capabilities in order to develop a commercially successful product. In addition, the
development of a viable market for our products may be impacted by many factors which are
out of our control, including: </FONT></P>





<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">

<TR VALIGN="TOP">
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">o<BR>
o<BR>
o<BR>
o<BR>
o<BR>
o
</FONT></TD>
     <TD WIDTH="90%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">the cost competitiveness of our products;<BR>
consumer reluctance to try a new product;<BR>
consumer perceptions of our products' safety;<BR>
regulatory requirements;<BR>
barriers to entry created by existing energy providers; and<BR>
the emergence of newer, more competitive technologies and products.
</FONT></TD></TR>
</TABLE>
<BR>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We may
need additional capital, which may not be accessible on attractive terms or at all.</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For the last several years, we have financed our operations through the sale of our securities
and by borrowing money. We may need to raise additional funds through public or private
financing. Our ability to obtain additional financing will be subject to a number of
factors, including market conditions, our operating performance and the terms of our
existing indebtedness. The terms of our 5% Senior Secured Convertible Debentures prevent us from
incurring additional debt until the registration statement registering the resale of the common shares
underlying the Debentures is declared effective; at such time, any additional debt we incur must be contractually
subordinated, as to payment and liquidation, to the payment in full of the Debentures.
We cannot assure you that we will be able to raise additional funds
on terms favorable to us or at all. If we raise additional funds through the sale of
equity or convertible debt securities, your ownership percentage of our common stock will
be reduced. In addition, these transactions may dilute the value of our common stock. We
may have to issue securities that have rights, preferences and privileges senior to our
common stock. The terms of any additional indebtedness may include restrictive financial
and operating covenants that would limit our ability to compete and expand. Our failure to
obtain any required future financing could materially and adversely effect our financial
condition. </FONT></P>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
have no experience manufacturing battery products on a large-scale commercial basis and
may be unable to do so.</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Since
we acquired our energy products business<I>,</I> we have focused primarily on research and
development and have no experience manufacturing our battery products on a commercial
basis. We do not know whether or when we will be able to develop efficient, low-cost
manufacturing capabilities and processes that will enable us to manufacture our battery
products in commercial quantities while meeting the quality, price, engineering, design
and production standards required to successfully market our battery products. Our failure
to develop such manufacturing processes and capabilities could have a material adverse
effect on our business, financial condition, results of operations and prospects. Even if
we are successful in developing our manufacturing capabilities and processes, we do not
know whether we will do so in time to meet our battery product commercialization schedule,
which calls for us to begin manufacturing our battery products by the end of 2004 and to
be produce commercial quantities of such products in 2005, or to satisfy the requirements
of potential distributors or customers. </FONT></P>


<P ALIGN=CENTER>5 </P>

<HR SIZE=3 COLOR=GRAY NOSHADE>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<A NAME=A031></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>We may not meet our
development and commercialization milestones. </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have established product development and commercialization milestones that we use to
assess our progress toward developing commercially viable battery and other energy related
products, including fuel cell systems. These milestones relate to technology and design
improvements as well as to dates for achieving development goals. To gauge our progress,
we plan to operate, test and evaluate our battery and energy related products. If our
systems or products exhibit technical defects or are unable to meet cost or performance
goals, including power output, useful life and reliability, our commercialization schedule
could be delayed and potential purchasers of our initial commercial battery and energy
products may decline to purchase them. We cannot assure you that we will successfully
achieve our milestones in the future or that any failure to achieve these milestones will
not result in potential<U> </U>competitors gaining advantages in our target market.
Failure to meet our development and commercialization milestones might have a material
adverse effect on our operations and our stock price. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
may be unable to establish relationships with third parties for aspects of product
development, manufacturing, distribution and servicing and the supply of key components
for our products.</B> </FONT></P>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
may need to enter into additional strategic relationships in order to complete our
current product development and commercialization plans. We may also require partners to
assist in the distribution, servicing and supply of components for our anticipated fuel
cell products which are in development. If we are unable to identify or enter into
satisfactory agreements with potential partners, we may not be able to complete our
product development and commercialization plans on schedule or at all. We may also need to
scale back these plans in the absence of needed partners, which would adversely affect our
future prospects. In addition, any arrangement with a strategic partner may require us to
make large cash payments to the partner, issue a significant amount of equity securities
to the partner, provide the partner with the opportunity to have representation on our
board of directors, agree to exclusive purchase or other arrangements with the partner
and/or commit significant financial resources to fund our product development efforts in
exchange for their assistance or the contribution to us of intellectual property. Any such
issuance of equity securities would reduce the percentage ownership of our then current
stockholders. While we have entered into relationships with suppliers of some key
components for our products, we do not know when or whether we will secure supply
relationships for all required components and subsystems for our products, or whether such
relationships will be on terms that will allow us to achieve our objectives. Our business,
prospects, results of operations and financial condition could be harmed if we fail to
secure relationships with entities which can develop or supply the required components for
our products and provide the required distribution and servicing support. Additionally,
the agreements governing our current relationships allow for termination by our partners
under certain circumstances. </FONT></P>

<P ALIGN=CENTER>6 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
may rely on third parties to develop and provide key components for our battery and
energy related products. </B>&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
may rely on third party suppliers to develop and supply key components that we will use
in our battery and energy related products. If those suppliers fail to develop and supply
these components in a timely manner or at all, or fail to develop or supply components
that meet our quality, quantity or cost requirements, and we are unable to obtain
substitute sources of these components on a timely basis or on terms acceptable to us, we
may not be able to manufacture our products. In addition, to the extent that our supply
partners use technology or manufacturing processes that are proprietary, we may be unable
to obtain comparable components from alternative sources. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
do not know when or whether we will secure long-term supply relationships with any
suppliers or whether such relationships will be on terms that will allow us to achieve our
objectives. Our business, prospects, results of operations and financial condition could
be harmed if we fail to secure long-term relationships with entities that will supply the
required components for our battery and energy related products </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
face high levels of competition and may be unable to compete successfully. </B>&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
markets in which we intend to compete are highly competitive. There are a number of
companies located in the United States, Canada and abroad that are developing battery and
fuel cell technologies and energy products that will compete with our technologies and
products. Some of our competitors are much larger than we are and may have the
manufacturing, marketing and sales capabilities to complete research, development and
commercialization of commercially viable products more quickly and effectively than we
can. </FONT></P>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Not
only do we face competition from other companies that are developing battery and fuel cell
technologies, but we also face competition from companies that provide energy products
based on traditional energy sources, such as oil and natural gas. We also face competition
from companies that are developing energy products based on alternative energy sources as
a significant amount of public and private funding is currently directed toward
development of a number of types of distributed generation technology, including
microturbines, solar power, wind power and other types of fuel cell technologies.
Technological advances in alternative energy products or other fuel cell
technologies may make our products less attractive or render them
obsolete. There are many companies engaged in all areas of traditional and alternative
energy generation in the United States, Canada and abroad, including, among others, major
electric, oil, chemical, natural gas, batteries, generators and specialized electronics
firms, as well as universities, research institutions and foreign government-sponsored
companies. Many of these entities have substantially greater financial, research and
development, manufacturing and marketing resources than we do. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Failure
of our planned products to pass testing could negatively impact demand for our products.
</B>&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
may encounter problems and delays during testing of our products for a number of reasons,
including the failure of our technology or the technology of third parties, as well as our
failure to maintain and service our products properly. Many of these potential problems
and delays are beyond our control. Any problem or perceived problem with our product tests
could materially harm our reputation and impair market acceptance of, and demand for, our
products. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Regulatory
and other changes in the energy industry may adversely affect our ability to produce, and
reduce demand for, our products.</B> </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
market for our technologies and products may be heavily influenced by federal, state,
local and foreign government laws, regulations and policies concerning the energy
industry. A change in the current regulatory policies could make it more difficult or
costly for us to develop, manufacture or market our products. Any such changes could also
deter further investment in the research and development of alternative energy sources,
including fuel cells, which could significantly reduce demand for our technologies and
products. We cannot predict how changes in regulation or other industry changes will
affect the market for our products or impact our ability to distribute, install and
service our products. </FONT></P>



<P ALIGN=CENTER>7 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
could be liable for environmental damages resulting from our research, development or
manufacturing operations.</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
business exposes us to the risk that harmful substances may escape into the environment,
resulting in personal injury or loss of life, damage to or destruction of property, and
natural resource damage. Our insurance policies may not adequately reimburse us for costs
incurred in defending and settling environmental damage claims, and in some instances, we
may not be reimbursed at all. Our business is subject to numerous federal, state and local
laws and regulations that govern environmental protection and human health and safety.
These laws and regulations have changed frequently in the past and it is reasonable to
expect there will be additional changes in the future. If our operations do not comply
with current or future environmental laws and regulations, we may be required to make
significant unanticipated capital and operating expenditures to bring our operations into
compliance. If we fail to comply with applicable environmental laws and regulations,
governmental authorities may seek to impose fines and penalties on us or to revoke or deny
the issuance or renewal of operating permits and private parties may seek damages from us.
Under those circumstances, we might be required to curtail or cease operations, conduct
site remediation or other corrective action, or pay substantial damage claims. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Our
products may use materials that are inherently dangerous substances which could subject
our business to product liability claims.</B> </FONT></P>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
energy technologies and products may use hydrogen or other materials that could leak and
combust if ignited by another source. These technologies and products expose us to
potential product liability claims that are inherent in hydrogen and products that use
hydrogen. Hydrogen is a flammable gas and therefore a potentially dangerous product.
Hydrogen is typically generated from gaseous and liquid fuels that are also flammable and
dangerous, such as propane, natural gas or methane, in a process known as reforming.
Natural gas and propane could leak into a residence or commercial location and combust if
ignited by another source. In addition, our products may operate at high temperatures,
which could expose us to potential liability claims, in the event of accidents involving
combustion or explosion. Accidents involving our products or other hydrogen-based products
could materially impede widespread market acceptance and demand for, or heighten
regulatory scrutiny of, our products. In addition, we might be held responsible for
damages beyond the scope of our insurance coverage. We also cannot predict whether we will
be able to maintain our insurance coverage on acceptable terms. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Product
liability or defects could negatively impact our results of operations. </B>&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
liability we incur for damages resulting from malfunctions or design defects of our
products could be substantial and could materially adversely affect our business,
financial condition, results of operations and prospects. In addition, a publicized actual
or perceived problem could adversely affect the market&#146;s perception of our products
resulting in a decline in demand for our products and could divert the attention of our
management, which may materially and adversely affect our business, financial condition,
results of operations and prospects. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Future
acquisitions may disrupt our business, distract our management and reduce the percentage
ownership of our stockholders.</B> </FONT></P>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
part of our business strategy we may seek to acquire complementary technologies, products,
channels, expertise and/or other valuable assets. However, we may not be able to identify
suitable acquisition candidates. If we do identify suitable candidates, we may not be able
to complete the acquisitions on commercially acceptable terms or at all. We may not be
able to successfully integrate the acquired business into our existing business in a
timely and non-disruptive manner. We may have to devote a significant amount of time and
management and financial resources to do so. Even with this investment of management and
financial resources, an acquisition may not produce the desired revenues, earnings or
business synergies. In addition, an acquisition may reduce the percentage ownership of our
then current stockholders. If we fail to integrate the acquired business effectively or if
key employees of that business leave, the anticipated benefits of the acquisition would be
jeopardized. The time, capital and management and other resources spent on an acquisition
that fails to meet our expectations could cause our business and financial condition to be
materially and adversely affected. In addition, as a result of any acquisition, we may
incur non-recurring charges and be required to amortize of significant amounts of
intangible assets, which could adversely affect our results of operations. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
may not be able to protect the intellectual property upon which we depend and we could
incur substantial costs defending against claims that our products infringe on the
proprietary rights of others.</B> </FONT></P>


<P ALIGN=CENTER>8 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
ability to compete effectively will depend, in part, on our ability to protect our
proprietary technologies, systems designs and manufacturing processes. We rely on patents,
trademarks, and other policies and procedures related to confidentiality to protect our
intellectual property. However, some of our intellectual property is not covered by any
patent or patent application. Moreover, we do not know whether any of our pending patent
applications will issue or, in the case of patents issued or to be issued, that the claims
allowed are or will be sufficiently broad to protect our technology or processes. Even if
all of our patent applications are issued and are sufficiently broad, our patents may be
challenged or invalidated. We could incur substantial costs in prosecuting or defending
patent infringement suits or otherwise protecting our intellectual property rights. While
we have attempted to safeguard and maintain our proprietary rights, we do not know whether
we have been or will be completely successful in doing so. Moreover, patent applications
filed in foreign countries may be subject to laws, rules and procedures that are
substantially different from those of the United States, and any resulting foreign patents
may be difficult and expensive to enforce. In addition, we do not know whether the U.S.
Patent &amp; Trademark Office will grant federal registrations based on our pending
trademark applications. Even if federal registrations are granted to us, our trademark
rights may be challenged. It is also possible that our competitors or others will adopt
trademarks similar to ours, thus impeding our ability to build brand identity and possibly
leading to customer confusion. We could incur substantial costs in prosecuting or
defending trademark infringement suits. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Further,
our competitors may independently develop or patent technologies or processes that are
substantially equivalent or superior to ours. If we are found to be infringing third party
proprietary rights, we could be required to pay substantial royalties and/or damages, and
we do not know whether we will be able to obtain licenses to use the intellectual property
at issue on acceptable terms, if at all. Failure to obtain needed licenses could delay or
prevent the development, manufacture or sale of our products, and could necessitate the
expenditure of significant resources to develop or acquire non-infringing intellectual
property. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asserting,
defending and maintaining our intellectual property rights could be difficult and costly
and failure to do so may diminish our ability to compete effectively and may harm our
operating results. We may need to pursue lawsuits or legal action in the future to enforce
our intellectual property rights, to protect our trade secrets and domain names and to
determine the validity and scope of the proprietary rights of others. If third parties
prepare and file applications for trademarks used or registered by us, we may oppose those
applications and be required to participate in proceedings to determine priority of rights
to the trademark. Similarly, competitors may have filed applications for patents, may have
received patents and may obtain additional patents and proprietary rights relating to
products or technology that block or compete with ours. We may have to participate in
interference proceedings to determine the priority of invention and the right to a patent
for the technology. Litigation and interference proceedings, even if they are successful,
are expensive to pursue and time consuming, and we could use a substantial amount of our
financial resources in either case. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
rely, in part, on contractual provisions to protect our trade secrets and proprietary
knowledge. </B>&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Confidentiality
agreements to which we are party may be breached, and we may not have adequate remedies
for any breach. Our trade secrets may also become known without breach of such agreements
or may be independently developed by competitors. Our inability to maintain the
proprietary nature of our technology and processes could allow our competitors to limit or
eliminate any competitive advantages we may have. </FONT></P>


<P ALIGN=CENTER>9 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Our
business depends on retaining and attracting highly capable management and operating
personnel. </B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
success depends in large part on our ability to retain and attract management and
operating personnel, including our Chairman and Chief Executive Officer, Kevin P.
Fitzgerald, our officers and other key employees. Our business requires highly killed
specialized workforce, including scientists, engineers, researchers and manufacturing and
marketing professionals, who are in high demand and are often subject to competing offers.
To retain and attract key personnel, we use various measures, including employment
agreements, a stock incentive plan and incentive bonuses for key employees. These measures
may not be enough to retain and attract the personnel we need or to offset the impact on
our business of the loss of the services of Mr.&nbsp;Fitzgerald or other key officers or
employees. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>We
face risks associated with our plans to market, distribute and service our products
internationally. </B>&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
intend to market, distribute and service our products internationally. We have limited
experience developing and no experience manufacturing our products to comply with the
commercial and legal requirements of international markets. Our success in international
markets will depend, in part, on our ability and that of our partners to secure
relationships with foreign sub-distributors, and our ability to manufacture products that
meet foreign regulatory and commercial requirements. Additionally, our planned
international operations are subject to other inherent risks, including potential
difficulties in enforcing contractual obligations and intellectual property rights in
foreign countries and fluctuations in currency exchange rates. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Our government contracts could
restrict our ability to effectively commercialize our technology. </B>&nbsp; &nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Some
of the technology we may be using has been or may be developed under government funding by the United States,
the terms of which may provide various rights including broad license rights to the United States government. Our
contracts with government agencies are also subject to the risk of termination at the
convenience of the contracting agency and potential disclosure of our confidential
information to third parties. Under the Freedom of Information Act, any documents that we
have submitted to the government or to a contractor under a government funding arrangement
may be subject to public disclosure that could compromise our intellectual property rights
unless these documents are exempted as trade secrets or as confidential information,
appropriately legended by us, and treated accordingly by such government agencies. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
a government contractor, we must comply with and are affected by federal government
regulations relating to the formation, administration and performance of government
contracts. These regulations will affect how we do business with our customers and may
impose added costs on our business. Any failure to comply with applicable laws and
regulations could result in contract termination, price or fee reductions or suspension or
debarment from contracting with the federal government. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, Federal government agencies routinely audit government contracts. These agencies
review a contractor&#146;s performance on its contract, pricing practices, cost structure
and compliance with applicable laws, regulations and standards. These audits may occur
several years after completion of the audited work. An audit could result in a substantial
adjustment to our revenue because any costs found to be improperly allocated to a
specific contract will not be reimbursed, while improper costs already reimbursed must be
refunded. If a government audit uncovers improper or illegal activities, we may be subject
to civil and criminal penalties and administrative sanctions, including termination of
contracts, forfeiture of profits, suspension of payments, fines and suspension or
debarment from doing business with federal government agencies. In addition, our
reputation could be harmed if allegations of impropriety were made against us. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<A NAME=A032></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>We may be unable to
manage rapid growth effectively. </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
expect to rapidly expand our manufacturing capabilities, accelerate the commercialization
of our products and enter a period of rapid growth, which will place a significant strain
on our senior management team and our financial and other resources. The proposed
expansion will expose us to increased competition, greater overhead, marketing and support
costs and other risks associated with the commercialization of a new product. Our ability
to manage our rapid growth effectively will require us to continue to improve our
operations, to improve our financial and management information systems and to train,
motivate and manage our employees. Difficulties in effectively managing the budgeting,
forecasting and other process control issues presented by such a rapid expansion could
harm our business, prospects, results of operations and financial condition. </FONT></P>



<P ALIGN=CENTER>10 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Our
stock price has been and could remain volatile. </B>&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
market price of our common stock has historically experienced and may continue to
experience significant volatility. In the twelve months ended December 31, 2003, our stock
closing price ranged from $0.03 to $1.73 per share. More recently, on January 26, 2004
our stock closing price was $1.40 per share. Our progress in developing and commercializing our
products, our quarterly operating results, announcements of new products by us or our
competitors, our perceived prospects, changes in securities&#146; analysts&#146;
recommendations or earnings&#146; estimates, changes in general conditions in the economy
or the financial markets, adverse events related to our strategic relationships and other
developments affecting us or our competitors could cause the market price of our common
stock to fluctuate substantially. In addition, in recent years, the stock market, and in
particular the market for technology-related stocks, has experienced significant price and
volume fluctuations. This volatility has affected the market prices of securities issued
by many companies for reasons unrelated to their operating performance and may adversely
affect the price of our common stock. In addition, we may be subject to additional
securities class action litigation as a result of volatility in the price of our common
stock, which could result in substantial costs and diversion of management&#146;s
attention and resources and could harm our stock price, business, prospects, results of
operations and financial condition. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<A NAME=A033></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Our principal
stockholder has substantial control over our affairs. </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ener1
is controlled by Ener1 Group, Inc., which owns approximately 93% of our outstanding common
stock. Two of Ener1 Group&#146;s board members are also members of our Board of Directors.
Ener1 Group has the ability to exert substantial influence over all matters submitted to a
vote of the stockholders of Ener1, including the election and removal of directors and any
merger, consolidation or sale of all or substantially all of our assets. In addition,
Ener1 Group may dictate the management of our business and affairs. This concentration of
ownership could have the effect of delaying, deferring or preventing a change in control
or impeding a merger or consolidation, takeover or other business combination which you,
as a stockholder, may otherwise view favorably. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Future
sales of our common stock may adversely affect our common stock price.
</B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
our stockholders sell a large number of shares of common stock or if we issue a large
number of shares in connection with future acquisitions or financings, the market price of
our common stock could decline significantly. In addition, the perception in the public
market that our stockholders might sell a large number of shares of common stock could
cause a decline in the market price of our common stock.</FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Our
certificate of incorporation and Florida law could adversely affect our common stock
price.</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provisions of our certificate of
incorporation and Florida law could discourage potential acquisition proposals and could
delay or prevent a change in control of us. These provisions could diminish the
opportunities for a stockholder to participate in tender offers, including tender offers
at a price above the then current market value of our common stock. These provisions may
also inhibit fluctuations in the market price of our common stock that could result from
takeover attempts. In addition, the Board of Directors, without further stockholder
approval, may issue additional series of preferred stock that could have the effect of
delaying, deterring or preventing a change in control of us. The issuance of additional
series of preferred stock could also adversely affect the voting power of the holders of
common stock, including the loss of voting control to others. </FONT></P>



<P ALIGN=CENTER> 11</P>
<HR SIZE=3 COLOR=GRAY NOSHADE>
<BR><BR>
<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A034></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cautionary Statement
About Forward-Looking Statements </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Some
of the information in this reoffer prospectus may contain &#147;forward-looking
statements,&#148; within the meaning of the Federal Private Securities Litigation Reform
Act of 1995. These statements can be identified by the use of forward-looking words such
as &#147;may,&#148; &#147;will,&#148; &#147;expect,&#148; &#147;anticipate,&#148;
&#147;estimate,&#148; &#147;continue&#148; or other similar words. These statements
discuss plans, goals and objectives for future operations and growth, contain projections
of results of operations or financial condition or state other &#147;forward-looking&#148;
information. You should understand that these forward-looking statements are necessarily
estimates reflecting our judgment, not guarantees of future performance. They are subject
to a number of assumptions, risks and uncertainties that could cause actual results to
differ materially from those expressed or implied in the forward-looking statements. The
following important factors, in addition to those discussed in &#147;Risk Factors&#148;
and other unforeseen events or circumstances, could affect our future results and could
cause those results or other outcomes to differ materially from those expressed or implied
in our forward-looking statements: general economic conditions; competition; our ability
to control costs; changes within our industries; our ability to successfully complete our
research and development initiatives; release of new and upgraded products and services by
us or our competitors; development of our sales force; employee retention; managerial
execution; legal and regulatory issues; changes in accounting policies or practices; and
successful adoption of our products and services. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accordingly,
you should not place undue reliance on forward-looking statements, which speak only as of
the date of this reoffer prospectus. All subsequent written and oral forward-looking
statements attributable to us or any person acting on our behalf are expressly qualified
in their entirety by the cautionary statements contained or referred to in this section.
We do not undertake any obligation to release publicly any revisions to these
forward-looking statements to reflect events or circumstances after the date of this
reoffer prospectus or to reflect the occurrence of unanticipated events. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A035></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>USE OF PROCEEDS </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
will not receive any proceeds from the sale of up to 1,030,000 shares of common stock by
the Selling Stockholders. </FONT></P><BR><BR>

<P ALIGN=CENTER>12 </P>
<!-- MARKER PAGE="sheet: 4; page: 4" -->
<HR SIZE=3 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A036></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SELLING STOCKHOLDERS </FONT></H1>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table sets forth information known to us with respect to the number of shares of
common stock beneficially owned by the Selling Stockholders named below and as adjusted to
give effect to the sale of the shares offered by this reoffer prospectus. The information
in the table below is current as of the date of this reoffer prospectus. The Selling
Stockholders may from time to time offer and sell pursuant to this reoffer prospectus any
or all of the common stock being registered. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
determined beneficial ownership in accordance with rules promulgated by the SEC, and the
information is not necessarily indicative of beneficial ownership for any other purpose.
Except as other indicated, we believe that the persons or entities named in the following
table have sole voting and investment power with respect to all shares of common stock as
beneficially owned by them, subject to community property laws where applicable. To
prevent dilution to the Selling Stockholders, the following numbers may change because of
stock splits, stock dividends or similar events involving our common stock. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
number of shares in the column labeled &#147;Shares Being Offered&#148; represent all of
the shares that each Selling Stockholder may offer under this reoffer prospectus. The
table assumes that the Selling Stockholders sell all of the shares. We are unable to
determine the exact number of shares that actually will be sold. We do not know how long
the Selling Stockholders will hold the shares before selling them and we currently have no
agreements, arrangements or understandings with any of the Selling Stockholders regarding
the sale of any of the shares. </FONT></P>


<TABLE WIDTH="600" BORDER="0" CELLPADDING="4" CELLSPACING="0">
<TR VALIGN="BOTTOM" align=left>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Name and Address</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Positions,<BR>
Offices or<BR>
Relationships<BR>
with Ener1<BR>
During Past 3<BR>
Years</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Shares Owned as<BR>
of the Date of<BR>this Reoffer<BR>Prospectus</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Shares Being<BR>Offered</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Shares Owned<BR>After Offering</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Percentage of<BR>Class Owned<BR>After Offering</FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="22%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">
Kevin P.            <BR>
Fitzgerald(1)       <BR>
<BR><BR>
Karl Gruns(1)       <BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR>
Ronald N. Stewart(1)<BR><BR><BR><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR>
Larry L. Light(2)   <BR><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<BR>
Alla Rozengurt(3)   <BR>
<BR><BR><BR><BR><BR>
Byron Buntin(4)     <BR>
<BR>
Olga Morkovina(5)<BR><BR>
Sergey Kaplan(6)
</FONT></TD>
     <TD WIDTH="18%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Director,
Chairman, Chief
Executive Officer<BR>
<BR>
Director         <BR>
<BR>
Executive Vice
President,
Director,
General Counsel and
Secretary<BR>
<BR>
Chief Executive
Officer,
EnerLook
Solutions, Inc.  <BR>
<BR>
Vice President
of Business
Development,
EnerLook
Solutions, Inc.  <BR>
<BR>
Employee         <BR>
<BR>
Employee<BR><BR>
Employee
</FONT></TD>
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR>
<BR>
2,189,363(7)<BR>
<BR>
142,000     <BR>
<BR>
<BR>
<BR>
<BR><BR>
370,000
<BR>
<BR>
<BR>
<BR>
240,000     <BR>
<BR>
<BR>
<BR>
<BR>
<BR>
205,000     <BR>
<BR>
70,000      <BR>
<BR>
70,000   <BR>   <BR>
70,000
</FONT></TD>
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">
<BR>
<BR>
300,000<BR>
<BR>
50,000       <BR>
<BR>
<BR>
<BR>
<BR><BR>
300,000
<BR>
<BR>
<BR>
<BR>
100,000      <BR>
<BR>
<BR>
<BR>
<BR>
<BR>
70,000       <BR>
<BR>
70,000       <BR>
<BR>
70,000       <BR><BR>
70,000
</FONT></TD>
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR>
<BR>
1,889,363<BR>
<BR>
92,000 <BR>
<BR>
<BR>
<BR>
<BR><BR>
70,000 <BR><BR>
<BR>
<BR>
140,000<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
130,000<BR>
<BR>
-0-    <BR>
<BR>
-0-<BR><BR>
-0-
</FONT></TD>
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR>
<BR>
*<BR>
<BR>
*<BR>
<BR>
<BR>
<BR>
<BR><BR>
*<BR>
<BR>
<BR>
<BR>
*<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
*<BR>
<BR>
*<BR>
<BR>
*<BR><BR>
*
</FONT></TD></TR>
</TABLE><BR>



<P ALIGN=CENTER>13 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>*  &nbsp;&nbsp;&nbsp;Less than one percent.</FONT></p>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lvl 3-TNR" FSL="Workstation" -->
     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1. </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The address for each of Messrs. Fitzgerald, Gruns and Stewart is c/o Ener1,
          Inc., 550 W. Cypress Creek Road, Suite 120, Ft. Lauderdale, FL, 33309.</FONT></TD>
          </TR>
          </TABLE>
          <BR>


     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2. </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2> Mr.
          Light&#146;s address is 381 SE 11 Street, Pompano Beach, FL, 33060. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lvl 3-TNR" FSL="Workstation" -->
     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3. </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Ms. Rozengurt&#146;s address is 328 Poinciana Island, North Miami, FL, 33160.</FONT></TD>
          </TR>
          </TABLE>
          <BR>
     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4. </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Mr. Buntin&#146;s address is 1309 Fulmar Drive, Delray Beach, FL, 33444. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5. </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2> Ms. Morkovina&#146;s address is 3020 NE 32 Avenue&nbsp;
          &nbsp;Apt. #1421 Ft. Lauderdale, Fl 33308.</FONT></TD>
          </TR>
          </TABLE>
          <BR>

     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6. </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr. Kaplan&#146;s address is 3640
          Yacht Club Drive,&nbsp;Apt. #1703,&nbsp; Aventura, Fl 33180. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lvl 3-TNR" FSL="Workstation" -->
     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7. </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Includes 1,889,363 shares that may be acquired by Mr. Fitzgerald within 60 days of
          the date of this reoffer prospectus upon the exercise of vested options. </FONT></TD>
          </TR>
          </TABLE>
          <BR>







<P ALIGN=CENTER>14 </P>
<!-- MARKER PAGE="sheet: 5; page: 5" -->
<HR SIZE=3 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A037></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PLAN OF DISTRIBUTION </FONT></H1>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
will not receive any proceeds from the sale of the shares covered by this reoffer
prospectus. The shares are being offered on behalf of the Selling Stockholders. The shares
may be sold or distributed from time to time by the Selling Stockholders, or by pledgees,
donees or transferees of, or other successors in interest to, the Selling Stockholders,
directly to one or more purchasers (including pledgees) or through brokers, dealers or
underwriters who may act solely as agents or who may acquire the shares as principals, at
market prices prevailing at the time of sale, at prices related to such prevailing market
prices, at negotiated prices, or at fixed prices, which may be changed. &nbsp; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
sale of the shares may be effected in one or more of the following methods: &nbsp; </FONT></P>






<TABLE WIDTH=600 BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="TOP">
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">o<BR>o<BR>
o<BR>
&nbsp;<BR>
o<BR>
&nbsp;<BR>
o<BR>
&nbsp;<BR>
o<BR>
o
</FONT></TD>
     <TD WIDTH="90%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">on any national securities exchange or quotation service on which our common
stock may be listed <BR>or quoted at the time of sale;<BR>in the over-the-counter market;<BR>
in transactions otherwise than on such exchanges or services in the<BR>
over-the-counter market; <BR>
through the writing of options, whether the options are listed on an<BR>
option exchange or otherwise; <BR>
in an exchange distribution in accordance with the rules of the <BR>
applicable exchange; <BR>
or through the settlement of short sales; or <BR>
through privately negotiated transactions.
</FONT></TD></TR>
</TABLE>


<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>In addition, any shares that qualify
for resale pursuant to Rule 144 of the Securities Act of 1933, as amended (the
&#147;Securities Act&#148;) may be sold under Rule 144 of the Securities Act rather than
pursuant to this prospectus. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These
transactions may include crosses or block transactions. Crosses are transactions in which
the same broker acts as agent on both sides of the trade. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, the Selling Stockholders or their successors in interest may enter into hedging
transactions with broker-dealers who may engage in short sales of the shares in the course
of hedging the positions they assume with the Selling Stockholders. The Selling
Stockholders or their successors in interest may also enter into option or other
transactions with broker-dealers that require the delivery by such broker-dealers of the
shares which may be resold under this reoffer prospectus. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brokers,
dealers, underwriters or agents participating in the distribution of the shares as agents
may receive compensation in the form of commissions, discounts or concessions from the
Selling Stockholders or purchasers of the shares for whom such broker-dealers may act as
agent, or to whom they may sell as principal, or both (which compensation as to a
particular broker-dealer may be less than or in excess of customary commissions). </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
staff of the SEC is of the view that selling security holders who are registered broker
dealers or affiliates of registered broker dealers may be underwriters under the
Securities Act. The SEC is also of the view that any broker-dealers who act in connection
with the sale of shares under this reoffer prospectus may be deemed to be
&#147;underwriters&#148; within the meaning of the Securities Act, and any commissions
they receive and proceeds they receive from any sale of shares may be deemed to be
underwriting discounts and commissions under the Securities Act. Neither we nor any
Selling Stockholder can presently estimate the amount of such compensation. We will not
pay any compensation or give any discounts or commissions to any underwriter in connection
with the securities being registered in this reoffer prospectus. We know of no existing
arrangements between any Selling Stockholder, any other stockholder, broker, dealer,
underwriter or agent relating to the sale or distribution of the shares. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
anti-manipulation rules under the Exchange Act may apply to sales of shares in the market
and to the activities of the Selling Stockholders and their affiliates. The Selling
Stockholders may not effect any sale or distribution of the shares until after this
reoffer prospectus has been appropriately amended or supplemented, if required. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Selling Stockholders may indemnify any broker-dealer that participates in transactions
involving the sale of the shares against certain liabilities, including liabilities
arising under the Securities Act, as amended. Any commissions paid or any discounts or
concessions allowed to any such broker-dealers, and any profits received on the resale of
such shares, may be deemed to be underwriting discounts and commissions under the
Securities Act, as amended if any such broker-dealers purchase shares as principal. </FONT></P>



<P ALIGN=CENTER>15 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
can not assure you that the Selling Stockholders will sell any of the shares offered by
this reoffer prospectus. The amount of securities that may be sold by a Selling
Stockholder under this reoffer prospectus may not exceed, during any three month period,
the amount set forth in Rule 144(e) under the Securities Act. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
will pay all expenses in connection with this offering, other than any underwriting
discounts and commissions, which will be paid by the Selling Stockholders. </FONT></P>



<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A038></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Legal Matters </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ronald
Stewart will opine as to the validity of the common stock offered by this reoffer
prospectus. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A039></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Experts </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
consolidated financial statements of Ener1 as of December 31, 2002 and for the two years
in the period ended December 31, 2002 incorporated by reference in this registration
statement have been audited by Kaufman, Rossin &amp; Co., independent certified public
accountants, as set forth in their report dated February 28, 2003 (except for Note 15, as
to which the date is April 2, 2003 and Note 8, as to which the date is April 14, 2003), and
are included in reliance upon such report given upon the authority of said firm as experts
in accounting and auditing. </FONT></P>






<BR><BR><BR><BR><BR><BR>
<P ALIGN=CENTER>16 </P>
<!-- MARKER PAGE="sheet: 6; page: 6" -->
<HR SIZE=3 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A040></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PART II </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A041></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>INFORMATION REQUIRED
IN THE REGISTRATION STATEMENT </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<A NAME=A042></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 3. Incorporation of
Documents by Reference </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Registrant hereby incorporates by reference into this Registration Statement the following
documents previously filed with the Securities and Exchange Commission (the
&#147;SEC&#148;): </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lvl 3-TNR" FSL="Workstation" -->
     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
           Ener1, Inc.&#145;s Annual Report on Form 10-KSB for the year ended December 31,
          2002 as amended pursuant to the 10-KSB/A filed with the SEC on April 30, 2003. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lvl 3-TNR" FSL="Workstation" -->
     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
           Ener1, Inc.&#145;s Quarterly Reports on Form 10-QSB for the quarters ending
          March 31, 2003, June 30, 2003 and September 30, 2003, respectively. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lvl 3-TNR" FSL="Workstation" -->
     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Ener1, Inc.'s Current Report on Form 8-K filed with the SEC on January 21, 2004.</FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lvl 3-TNR" FSL="Workstation" -->
     <TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=15%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d) </FONT></TD>
          <TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
           The description of the Registrant&#146;s common stock contained in the
          Registrant&#146;s Current Report on Form 8-K filed with the SEC on February 6,
          2004. </FONT></TD>
          </TR>
          </TABLE>
          <BR>




<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
documents filed pursuant to Sections&nbsp;13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 (the &#147;Exchange Act&#148;) after the date of this Registration
Statement and prior to the filing of a post-effective amendment which indicates that all
securities offered hereby have been sold or which deregisters all securities then
remaining unsold shall be deemed to be incorporated by reference into this Registration
Statement and to be a part hereof from the date of filing of such documents. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
document, and any statement contained in a document, incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded for purposes
of this Registration Statement to the extent that a statement contained herein, or in any
other subsequently filed document that also is incorporated or deemed to be incorporated
by reference herein, modifies or supersedes such document or statement. Any such document
or statement so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Registration Statement. Subject to the foregoing,
all information appearing in this Registration Statement is qualified in its entirety by
the information appearing in the documents incorporated by reference. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR"  -->
<A NAME=A043></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 4. Description of
Securities</FONT></H1>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Not Applicable.</FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR"  -->
<A NAME=A044></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 5. Interests of
Named Experts and Counsel </FONT></H1>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Not Applicable.</FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<A NAME=A045></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 6. Indemnification
of Directors and Officers </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to Section 607.0850 of the Florida Statutes, the Registrant has the power to indemnify any
person made a party to any lawsuit by reason of being a director or officer of the
Registrant, or serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys&#146; fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was unlawful. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers or persons controlling the Registrant pursuant to the
foregoing provisions, the Registrant has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is therefore unenforceable. </FONT></P>


<P ALIGN=CENTER>17 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Registrant&#146;s Amended and Restated Articles of Incorporation and By-laws provide that
the Registrant shall indemnify its directors and officers to the fullest extent permitted
by Florida law. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Registrant has purchased insurance with respect to, among other things, the liabilities
that may arise under the statutory provisions referred to above. The directors and
officers of the Registrant also are insured against certain liabilities, including certain
liabilities arising under the Securities Act of 1933, which might be incurred by them in
such capacities and against which they are not indemnified by the Registrant. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Registrant has entered into separate indemnification agreements with its directors and
officers. The indemnity agreements create certain indemnification obligations of the
Registrant in favor of the directors and officers and, as permitted by applicable law,
will clarify and expand the circumstances under which a director or officer will be
indemnified. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<A NAME=A046></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 7. Exemption from
Registration Claimed </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With respect to the
restricted securities being offered by this registration statement, the
Registrant claimed exemptions from registration in accordance with Section 4(2) of the
Securities Act of 1933 for shares of common stock previously issued under various
agreements between the Registrant and the Selling Stockholders. These exemptions were
available to the Registrant for the issuance of the shares of common stock because the
issuances did not involve a public offering, advertising or general solicitation. The
shares were issued to 7 persons, each of whom had a pre-existing relationship with the
Registrant as either a director, officer or employee of the Registrant. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Default" -->
<A NAME=A047></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 8. Exhibits </FONT></H1>













<TABLE WIDTH="100%" BORDER="0" CELLPADDING="3" CELLSPACING="0">
<TR VALIGN="BOTTOM" align=left>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Exhibit Number</U></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Description</U></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="10%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">4.1 <BR>
&nbsp;&nbsp;&nbsp;&nbsp;<BR>
<BR>
4.2 <BR>
&nbsp;&nbsp;&nbsp;&nbsp;<BR>
<BR>
4.3 <BR>
&nbsp;&nbsp;&nbsp;&nbsp;<BR>
<BR>
4.4 <BR>
&nbsp;&nbsp;&nbsp;&nbsp;<BR>
<BR>
4.5 <BR>
<BR>
4.6 <BR>
&nbsp;&nbsp;&nbsp;&nbsp;<BR>
<BR>
4.7 <BR>
<BR>
4.8 <BR>
<BR>
4.9 <BR>
<BR>
23.1<BR>
<BR>
24.1
</FONT></TD>
     <TD WIDTH="90%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Articles of Incorporation of the Registrant incorporated by reference to Exhibit 3(i) to the Registrant's Quarterly Report
on Form 10-Q for the quarter ended September 30, 2000 (No. 000-21138).<BR>
<BR>
Amendment to Articles of Incorporation incorporated by reference to Exhibit 3.2 to the Registrant's Annual Report on Form
10-K for the year ended December 31, 2001 (No. 000-21138).<BR>
<BR>
Amendment to Articles of Incorporation incorporated by reference to Exhibit 3.1 to the Registrant's current report on Form
8-K dated October 28, 2002 (No. 000-21138).<BR>
<BR>
By-Laws of the Registrant incorporated by reference to Exhibit 3.4 to the Registrant's Quarterly Report on Form 10-QSB filed
November 14, 2003.<BR>
<BR>
Form of Stock Option Agreement under Ener1, Inc. 2002 Stock Participation Plan.<BR>
<BR>
Employment Agreement by and between the Registrant and Kevin P. Fitzgerald incorporated by reference to Exhibit 10.6 of
the Registrant's Quarterly Report on Form 10-Q filed November 14, 2003.<BR>
<BR>
Investment Agreement dated as of January 1, 2003 by and between the Registrant and Karl Gruns.<BR>
<BR>
Stock Award Agreement dated as of May 16, 2003 by and between the Registrant and Ronald D. Stewart.<BR>
<BR>
Stock Award Agreement dated as of May 16, 2003 by and between the Registrant and Larry L. Light.<BR>
<BR>
Consent of Kaufman, Rossin &amp; Co.<BR>
<BR>
Power of Attorney (included on the signature pages to this Registration Statement on Form S-8).
</FONT></TD></TR>
</TABLE>


<P ALIGN=CENTER>18 </P>
<HR SIZE=3 COLOR=GRAY NOSHADE>
<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR"  -->
<A NAME=A048></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 9. Undertaking </FONT></H1>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned Registrant hereby undertakes:
</FONT></P>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;to
file, during any period in which offers or sales are being made, a post-effective
amendment to this Registration Statement (i)&nbsp;to include any prospectus required by
Section&nbsp;10(a)(3) of the Securities Act; (ii)&nbsp;to reflect in the prospectus any
facts or events arising after the effective date of this Registration Statement (or the
most recent post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement; and (iii)&nbsp;to include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any material
change to such information in this Registration Statement; <U>provided</U>, however, that
clauses (1)(i) and (l)(ii) shall not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section&nbsp;13 or Section&nbsp;15(d) of the Exchange Act that are
incorporated by reference into this Registration Statement; </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;that
for the purpose of determining any liability under the Securities Act, each such
post-effective amendment shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof; and </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;to
remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold upon the termination of the offering. </FONT></P>

<BR><BR><BR><BR><BR>

<P ALIGN=CENTER>19 </P>
<!-- MARKER PAGE="sheet: 7; page: 7" -->
<HR SIZE=5 COLOR=GRAY NOSHADE>




<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A049></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SIGNATURES </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to the requirements of the Securities Act of 1933, the Registrant certifies that it has
reasonable grounds to believe that it meets all of the requirements for filing on
Form&nbsp;S-8 and has duly caused this Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Ft. Lauderdale, State of
Florida, on the 4th day of February 2004. </FONT></P>











<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="TOP">
     <TD WIDTH="70%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;</FONT></TD>
     <TD WIDTH="30%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">ENER1, INC.<BR>
<BR>
By:  <U>/s/ Kevin P. Fitzgerald</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Kevin P. Fitzgerald<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Executive Officer
</FONT></TD></TR>
</TABLE><BR><BR><BR>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A050></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>POWER OF ATTORNEY </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;KNOW
ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes
and appoints Ronald Stewart and Kevin P. Fitzgerald, and each of them, his or her true and
lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for
him or her and in his or her name, place and stead, in any and all capacities, to sign any
and all amendments (including post-effective amendments) to this Registration Statement,
and to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or
their or his substitutes or substitute, may lawfully do or cause to be done by virtue
hereof. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement has been
signed below by the following persons in the capacities and on the dates indicated. </FONT></P>











<TABLE WIDTH=600 CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="BOTTOM" align=center>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Signature</FONT></TH>
     <TH ALIGN="center"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Title&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Date</FONT></TH></TR>
<TR VALIGN="TOP" align=center>
     <TD WIDTH="34%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>/s/ Kevin P. Fitzgerald</U><BR>
          Kevin P. Fitzgerald<BR><BR>
<BR>
<U>/s/ Randall Paulfus</U><BR>Randall Paulfus  <BR><BR>
<BR>
<U>/s/ Boris Zingarevich</U><BR>Boris Zingarevich<BR><BR>

<U>/s/ Karl Gruns</U><BR>Karl Gruns<BR><BR>

<U>/s/ Mike Zoi</U><BR>Mike Zoi<BR><BR>

<U>/s/ Dr. Peter Novak</U><BR>Dr. Peter Novak<BR><BR>

<U>/s/ Ronald N. Stewart</U><BR>Ronald N. Stewart<BR>

</FONT></TD>
     <TD WIDTH="33%" ALIGN="LEFT"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Chief Executive Officer and Director
and Chairman of the Board (Principal
Executive Officer)<BR>
<BR>
Chief Financial Officer (Principal
Financial Officer &amp; Principal
Accounting Officer)<BR>
<BR>
Director<BR><BR>
<BR>Director <BR><BR><BR>Director
<BR>
<BR>
<BR>
Director<BR>
<BR>
<BR>
Director
</FONT></TD>
     <TD WIDTH="33%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">February 4, 2004<BR>
<BR>
<BR>
<BR>
February 4, 2004<BR>
<BR>
<BR>
<BR>
February 4, 2004<BR>
<BR>
<BR>
February 4, 2004<BR>
<BR>
<BR>
February 4, 2004<BR>
<BR><BR>
February 4, 2004<BR>
<BR><BR>
February 4, 2004<BR>
<BR>
</FONT></TD></TR>
</TABLE>

<BR><BR><BR>


<!-- MARKER PAGE="sheet: 8; page: 8" -->
<HR SIZE=5 COLOR=GRAY NOSHADE>



<!-- MARKER FORMAT-SHEET="Head Center Underline-TNR" FSL="Default" -->
<A NAME=A051></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>EXHIBIT INDEX </U></FONT></P>





<TABLE WIDTH="100%" BORDER="0" CELLPADDING="2" CELLSPACING="0">
<TR VALIGN="BOTTOM" align=left>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Exhibit Number</U></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Exhibit</U></FONT></TH></TR>
<TR VALIGN="TOP">
     <TD WIDTH="15%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">4.5 <BR>
<BR>
4.7 <BR>
<BR>
4.8 <BR>
<BR>
4.9 <BR>
<BR>
23.1<BR>
<BR>
24.1
</FONT></TD>
     <TD WIDTH="85%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Form of Stock Option Agreement under Ener1, Inc. 2002 Stock Participation Plan.<BR>
<BR>
Investment Agreement dated as of January 1, 2003 by and between the Registrant and Karl Gruns.<BR>
<BR>
Stock Award Agreement dated as of May 16, 2003 by and between the Registrant and Ronald D. Stewart.<BR>
<BR>
Stock Award Agreement dated as of May 16, 2003 by and between the Registrant and Larry L. Light.<BR>
<BR>
Consent of Kaufman, Rossin &amp; Co.<BR>
<BR>
Power of Attorney (included on the signature pages to this Registration Statement on Form S-8).
</FONT></TD></TR>
</TABLE>









</BODY>
</HTML>
[{"type": "S-8", "sequence": "1", "filename": "ener1s8.htm", "secsgml_size_bytes": 119342}]
{"company-data": {"conformed-name": "ENER1 INC", "cik": "0000895642", "assigned-sic": "3661", "irs-number": "592479377", "state-of-incorporation": "FL", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-112583", "film-number": "04574841"}, "business-address": {"street1": "550 WEST CYPRESS CREEK ROAD", "street2": "SUITE 120", "city": "FORT LAUDERDALE", "state": "FL", "zip": "33309", "phone": "(954) 202-4442"}, "mail-address": {"street1": "550 WEST CYPRESS CREEK ROAD", "street2": "SUITE 120", "city": "FORT LAUDERDALE", "state": "FL", "zip": "33309"}, "former-company": [{"former-conformed-name": "ENER 1 INC", "date-changed": "20021028"}, {"former-conformed-name": "INPRIMIS INC", "date-changed": "20001128"}, {"former-conformed-name": "BOCA RESEARCH INC", "date-changed": "19940408"}]}
Form S-8 for Ener1, Inc.
Registration No. —
SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF
1933
_________________
ENER1, INC.
(Exact Name of
Registrant as Specified in Its Charter)
Florida
(State or Other
Jurisdiction of
Incorporation or
Organization)
550 W. Cypress Creek Rd., Suite 120
Ft. Lauderdale, FL 33309
(Address of Principal Executive Offices Including Zip Code)
59-2479377
(I.R.S. Employer
Identification No.)
_________________
KEVIN P. FITZGERALD
EMPLOYMENT AGREEMENT
RONALD STEWART STOCK
AWARD AGREEMENT
LARRY L. LIGHT STOCK
AWARD AGREEMENT
KARL GRUNS INVESTMENT
AGREEMENT
ALLA ROZENGURT STOCK
OPTION AGREEMENT
BYRON BUNTIN STOCK
OPTION AGREEMENT
OLGA MORKOVINA STOCK
OPTION AGREEMENT
SERGEY KAPLAN STOCK
OPTION AGREEMENT
(Full Title of the Plan)
_________________
Ronald Stewart
General Counsel
Ener1, Inc.
550 W. Cypress Creek Rd., Suite 120,
Ft. Lauderdale, FL 33309
Copies to:
Stephen I. Glover, Esq.
Gibson, Dunn & Crutcher LLP
1050 Connecticut Avenue, N.W.
Washington, D.C. 20036
(202) 955-8500
(Name and Address of Agent
For Service)
_________________
(954) 202-4442
(Telephone Number,
Including Area Code, of Agent For Service)
_________________
CALCULATION OF
REGISTRATION FEE
Title of Securities
to be Registered
Amount to be
Registered(1)
Proposed Maximum
Offering Price
Per Share(2)
Proposed Maximum
Aggregate
Offering Price(2)
Amount of
Registration Fee(3)
Common Stock, par value
$.01 per share
1,030,000 shares
$ 1.14
$ 1,174,200
$ 148.77
(1)
Includes 300,000 shares of common stock of Ener1, Inc. (the "Registrant or
               the "Company") issued pursuant to a stock grant made by the Company to
               its director and Chief Executive Officer, Kevin P. Fitzgerald, in accordance with the Employment Agreement between
               the Company and Mr. Fitzgerald dated as of September 8, 2003 (the
               "Fitzgerald Employment Agreement"). Also includes 300,000 shares
               issued by the Company to its director, Executive Vice President, General Counsel
               and Secretary, Ronald Stewart, as
               partial compensation for his services in accordance with the Stock Award
               Agreement between the Company and Mr. Stewart dated as of May 16, 2003 (the
               "Stewart Award Agreement"). Also includes 100,000 shares issued by the
               Company to Larry L. Light, the Chief Executive Officer of a Company affiliate,
               EnerLook Solutions, Inc., as partial compensation for his services in accordance
               with the Stock Award Agreement between the Company and Mr. Light dated as of May
               16, 2003 (the "Light Award Agreement"). Also includes 50,000 shares
               issued by the Company to one of its directors, Karl Gruns, as partial
               compensation for his services in accordance with the Investment Agreement
               between the Company and Mr. Gruns dated as of January 1, 2003 (the "Gruns
               Award Agreement"). Also includes an aggregate of 280,000 shares of common
               stock issued to Alla Rozengurt, Byron Buntin, Olga Morkovina and Sergey Kaplan
               upon exercise of stock options granted under the Company's 2002 Stock
               Participation Plan (the "Stock Option Agreements"). Each of the
               Fitzgerald Employment Agreement and the Stewart, Light and Gruns Award
               Agreements and the Stock Option Agreements qualifies as an Employee Benefit Plan
               as defined under Rule 405 of Regulation C.
(2)
Estimated solely for the purpose of calculating the registration fee.
(3)
The registration fee has been calculated in accordance with Rule 457(h) under
               the Securities Act of 1933.
1
Explanatory Note
Ener1
has prepared this Registration Statement in accordance with the requirements of
Form S-8 under the Securities Act to register shares of its Common Stock (the
"Shares"), issued or issuable to some of its directors, executive officers and
employees (the "Selling Stockholders"), as compensation for their services to
Ener1.
This
Registration Statement contains two parts. The first part contains a prospectus prepared
in accordance with Part I of Form S-8 (in accordance with Instruction C of the
General Instructions to Form S-8) which covers reoffers and resales of shares of the
Shares issued to the Selling Stockholders as compensation for their services. The second
part contains information required in the Registration Statement pursuant to Part II
of Form S-8. Information required by Part I of Form S-8 is omitted from
this Registration Statement in accordance with Rule 428 under the Securities Act and
the "Note" to Part I of Form S-8.
Reoffer Prospectus
1,030,000 Shares of
Common Stock of
Ener1, Inc.
The
shares of common stock, $0.01 par value per share (the "Shares"), of
Ener1, Inc. ("Ener1") covered by this reoffer prospectus, may be offered
and sold to the public from time to time by the selling stockholders named in this
prospectus (the "Selling Stockholders"). The Shares have been issued, or are
issuable to, the Selling Stockholders as compensation for their services to Ener1.
The
Selling Stockholders may sell Shares directly or indirectly in one or more transactions on
any stock exchange or stock market on which the Shares may be listed at the time of sale,
in privately negotiated transactions, or through a combination of such methods. These
sales may be at fixed prices (which may be changed), at market prices prevailing at the
time of sale, at prices related to such prevailing market prices or at negotiated prices.
This
reoffer prospectus has been prepared for the purpose of registering the Shares under the
Securities Act of 1933, as amended (the "Securities Act") to allow for future
sales by the Selling Stockholders to the public. The Selling Stockholders may sell Shares
through one or more agents, brokers or dealers or directly to purchasers. Ener1 will not
receive any proceeds from the sale of the shares by the Selling Stockholders.
This
investment involves a high degree of risk. Please see "Risk Factors" beginning
on page 4.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or
disapproved of these securities or determined whether this reoffer prospectus is truthful
or complete. Any representation to the contrary is a criminal offense.
2
Table of Contents
Page #s
Additional Information
3
Incorporation of Certain Documents by Reference
3
The Company
3
Risk Factors
4
Use of Proceeds
12
Selling Stockholders
13
Plan of Distribution
15
Legal Matters
16
Experts
16
You
should rely only on the information contained in this reoffer prospectus or any
supplement. Ener1 has not authorized anyone to provide you with information different from
that which is contained in or incorporated by reference in this reoffer prospectus. The
Selling Stockholders are offering to sell shares of common stock and seeking offers to buy
shares of common stock only in jurisdictions where offers and sales are permitted. The
information contained in this reoffer prospectus is accurate only as of the date of this
reoffer prospectus, regardless of the time of delivery of this reoffer prospectus or of
any sale of the Shares.
Additional Information
Ener1
has filed with the U.S. Securities and Exchange Commission (the "SEC") a
registration statement on Form S-8 under the Securities Act with respect to the
Shares offered by this reoffer prospectus. This reoffer prospectus does not contain all of
the information set forth in the registration statement and the exhibits to the
registration statement. For further information with respect to Ener1 and the Shares
offered by this reoffer prospectus, you should read the registration statement and the
exhibits to the registration statement. Statements contained in this reoffer prospectus
regarding the contents of any contract or any other document to which reference is made
are not necessarily complete. In each instance where a copy of such contract or other
document has been filed as an exhibit to the registration statement, reference is made to
the copy so filed and each statement is qualified in all respects by such reference.
Ener1
is subject to the informational requirements of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and, as required by the Exchange Act, files
reports and other information with the SEC. The registration statement, including
exhibits, and the reports and other information filed by Ener1 can be inspected without
charge at the public reference facilities maintained by the SEC at the SEC's
principal office at 450 Fifth Street, N.W., Room 1024, Washington, D.C., 20549. Copies of
this material can be obtained from the SEC at fees prescribed by the SEC. You may obtain
information on the operation of the Public Reference room by calling the SEC at
1-800-SEC-0330. The SEC maintains a World Wide Web site that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the SEC. The address of this site is
http://www.sec.gov
. In
addition, Ener1 makes copies of its electronic filings with the SEC available on the
investor relations portion of its web site at www.ener1.com.
The Company
Ener1
develops and markets technologies and products related to lithium batteries, fuel cells
and solar cells. Our goal is to be the technology leader in both lithium batteries and
fuel cells. We are developing samples of products and components of lithium batteries
based on our proprietary technologies, as well as technologies, materials and prototypes
for new types of fuel cells and solar cells. We have 11 full-time scientists in our Ft. Lauderdale
facility and 18 full-time and 36 part-time scientists at our facilities in the Ukraine performing
research and development work related to our lithium battery, fuel cell and solar cell
technologies and products.
3
We
plan to produce fuel cell prototypes using our proprietary fuel cell technology. If the prototypes are successful, we
would then establish a pilot scale, fuel cell production facility. The pilot scale
production facility will be used for continued research and development and manufacturing
selected high margin fuel cell components. We believe our fuel cell technologies will
enable us to produce fuel cells which have an extended working life, use fuel more
efficiently, have higher mass and volume specific energy characteristics and a lower
$/kilowatt cost than those currently on the market. We recently filed a U.S. patent
application for a new electrochemical generator based on a hydrogen-air fuel cell.
We
have numerous patents, both issued and pending, for lithium battery-related technologies,
products, processes and components. We have built a lithium battery manufacturing plant
and laboratory facility in Ft. Lauderdale, Florida and own the associated land and
building. The facility is equipped with three production lines including a pilot line
for prototypes. We plan to begin battery production at the end of 2004.  In 2003, we formed a joint
venture company named EnerStruct, Inc. with ITOCHU Corporation of Japan, to which we and
ITOCHU have licensed certain of our lithium battery technologies for use in Japanese
markets. ITOCHU invested $3.5 million in our company in July of 2003. We invested $2
million of this amount in EnerStruct and own 49% of EnerStruct.
In
addition to our lithium battery and fuel cell business, we have been developing and
marketing technologies for products and services to neutralize the harmful effects of
electromagnetic fields in electric power transmission lines and related equipment, through
our Ener1 Technologies, Inc. subsidiary. We also own approximately 49% of EnerLook
Solutions, Inc., which develops and markets turn-key video-on-demand and interactive
TV-based information and communications systems to customers in the health care and
hospitality industries. Until May 2003, we conducted this business primarily through our
former Digital Media Technologies Division; today, we conduct this business through
EnerLook Solutions, Inc.
In January 2004,
we issued $20 million in aggregate principal amount of our 5% Senior Secured Convertible Debentures due 2009 and
warrants to purchase 16 million shares of our common stock in a private placement. We expect to use the proceeds of
this offering to fund the development of our lithium battery and fuel cell products.
We
were founded in 1985 as Boca Research, Inc., a Florida corporation, to market
communications software and data communications, I/O, multiport, and video products. In
October 2000, we changed our name to Inprimis, Inc. October 2001, we began to sell
products based on our video-on-demand and interactive TV systems to solution providers in
the hospitality and healthcare markets and other markets. In January 2002, Ener1 Group,
Inc. acquired a majority interest in our company and now owns approximately 93% of the our
common stock. We further diversified our business in September 2002, when we acquired
Ener1 Battery Company, from Ener1 Group, Inc. Following this acquisition, we changed our
name to Ener1, Inc.
Our executive offices are located at 550 W. Cypress Creek Rd., Suite 120, Fort Lauderdale, FL 33309 and our phone number is
(954) 202-4442.
RISK FACTORS
An
investment in our common stock involves a high degree of risk. You should carefully
consider the risks described below, as well as other information contained in this
prospectus, before investing in our common stock. Additional risks and uncertainties not
presently known to us or that we currently deem immaterial may also affect our business
operations. If any of these risks occur, our business could suffer, the market price of
our common stock could decline and you could lose all or part of your investment in our
common stock. This section includes or refers to forward-looking statements. You should
refer to the explanation of the qualifications and limitations on forward-looking
statements discussed on page 14.
Risks Related to Our
Business
We
have a history of operating losses and we may not be able to continue as a going concern.
We
have experienced net operating losses since 1997, incurred negative cash flows from
operations since 1999 and, as of September 30, 2003, had an accumulated deficit of $54.7
million. Cash used in operations for the years ended December 31, 1999, 2000, 2001 and
2002 was $6.1 million, $8.2 million, $6.2 million and $6.5 million, respectively. We had
negative cash flows from operations of $4.2 million for the nine months ended September
30, 2003. We expect that we will continue to incur negative cash flows and require
additional cash to fund our operations and implement our business plan. The continued
development of our energy-related technology and products will require significant
additional capital investment. Our financial statements have been prepared assuming that
we will continue as a going concern. However, the auditor's reports on our financial
statements state that there is substantial doubt about our ability to continue as a going
concern.
4
The terms of our
5% Senior Secured Convertible Debentures restrict our operations.
Our 5% senior secured
convertible debentures contain restrictive covenants that limit our ability to, among other things:
o
o
o
o
o
o
dispose of assets;
incur debt;
pay dividends;
repurchase our capital stock and debt securities;
create liens on our assets; and
engage in transactions with our affiliates.
These covenants may significantly limit our ability
to respond to changing business and economic conditions and to secure additional financing, and we may be
prevented from engaging in transactions that might be considered important to our business strategy or otherwise
beneficial to us.
We
may never complete the research and development of commercially viable products.
Although
we have conducted other business activities in the past, we have only recently reorganized
our activities to focus on the development of energy and battery related products. We do
not know when or whether we will successfully complete research and development of
commercially viable energy products. If we are unable to develop commercially viable
products, we will not be able to generate sufficient revenue to become profitable. The
commercialization of our products depends on our ability to control the costs of
manufacturing, and we cannot assure you that we will be able to sufficiently control these
costs. We must complete substantial additional research and development before we will be
able to manufacture a commercially viable battery products in commercial quantities In
addition, while we are conducting tests to predict the overall life of our products, we
may not have tested our products over their projected useful life prior to large-scale
commercialization. As a result, we cannot be sure that our products will last as long as
predicted, and, if they do not, we may incur liability under warranty claims.
We
have only recently acquired our energy business, and your basis for evaluating us is
limited.
We
acquired our energy products business in September, 2002. Accordingly, there is
only a limited basis upon which you can evaluate our business and prospects. We have an
unproven business plan and do not expect to be profitable for the next few years.
During the past two years, we have shifted our business from providing engineering
services and interactive products to focus primarily on developing technologies and
products for the battery and fuel cell industries. Before investing in our
securities, you should consider the challenges, expenses and difficulties that we will
face as a development stage company seeking to develop and manufacture new products.
Viable
markets for our products may never develop, may take longer to develop than we anticipate
or may not be sustainable.
Our
energy products and technologies target emerging markets, and we do not know the extent to
which our technologies and products will be accepted. To date we do not have any
commercially viable products. We must be able to develop a commercially viable product for
our business to succeed. If a viable market fails to develop or develops more slowly than
we anticipate, we may be unable to recover the losses we will have incurred to develop our
products and may be unable to achieve profitability. Our target customers for our battery
products include customers in the Department of Defense and military forces and in the
transportation, medical and other industries. We also plan to license our technologies for
others to use to manufacture battery products for the consumer product sector. Our target
fuel cell customers include automobile companies and other companies to whom we would
license our fuel cell technologies for use in manufacturing fuel cell products and
systems. We will need to develop or acquire adequate marketing and manufacturing
capabilities in order to develop a commercially successful product. In addition, the
development of a viable market for our products may be impacted by many factors which are
out of our control, including:
o
o
o
o
o
o
the cost competitiveness of our products;
consumer reluctance to try a new product;
consumer perceptions of our products' safety;
regulatory requirements;
barriers to entry created by existing energy providers; and
the emergence of newer, more competitive technologies and products.
We may
need additional capital, which may not be accessible on attractive terms or at all.
For the last several years, we have financed our operations through the sale of our securities
and by borrowing money. We may need to raise additional funds through public or private
financing. Our ability to obtain additional financing will be subject to a number of
factors, including market conditions, our operating performance and the terms of our
existing indebtedness. The terms of our 5% Senior Secured Convertible Debentures prevent us from
incurring additional debt until the registration statement registering the resale of the common shares
underlying the Debentures is declared effective; at such time, any additional debt we incur must be contractually
subordinated, as to payment and liquidation, to the payment in full of the Debentures.
We cannot assure you that we will be able to raise additional funds
on terms favorable to us or at all. If we raise additional funds through the sale of
equity or convertible debt securities, your ownership percentage of our common stock will
be reduced. In addition, these transactions may dilute the value of our common stock. We
may have to issue securities that have rights, preferences and privileges senior to our
common stock. The terms of any additional indebtedness may include restrictive financial
and operating covenants that would limit our ability to compete and expand. Our failure to
obtain any required future financing could materially and adversely effect our financial
condition.
We
have no experience manufacturing battery products on a large-scale commercial basis and
may be unable to do so.
Since
we acquired our energy products business
,
we have focused primarily on research and
development and have no experience manufacturing our battery products on a commercial
basis. We do not know whether or when we will be able to develop efficient, low-cost
manufacturing capabilities and processes that will enable us to manufacture our battery
products in commercial quantities while meeting the quality, price, engineering, design
and production standards required to successfully market our battery products. Our failure
to develop such manufacturing processes and capabilities could have a material adverse
effect on our business, financial condition, results of operations and prospects. Even if
we are successful in developing our manufacturing capabilities and processes, we do not
know whether we will do so in time to meet our battery product commercialization schedule,
which calls for us to begin manufacturing our battery products by the end of 2004 and to
be produce commercial quantities of such products in 2005, or to satisfy the requirements
of potential distributors or customers.
5
We may not meet our
development and commercialization milestones.
We
have established product development and commercialization milestones that we use to
assess our progress toward developing commercially viable battery and other energy related
products, including fuel cell systems. These milestones relate to technology and design
improvements as well as to dates for achieving development goals. To gauge our progress,
we plan to operate, test and evaluate our battery and energy related products. If our
systems or products exhibit technical defects or are unable to meet cost or performance
goals, including power output, useful life and reliability, our commercialization schedule
could be delayed and potential purchasers of our initial commercial battery and energy
products may decline to purchase them. We cannot assure you that we will successfully
achieve our milestones in the future or that any failure to achieve these milestones will
not result in potential
competitors gaining advantages in our target market.
Failure to meet our development and commercialization milestones might have a material
adverse effect on our operations and our stock price.
We
may be unable to establish relationships with third parties for aspects of product
development, manufacturing, distribution and servicing and the supply of key components
for our products.
We
may need to enter into additional strategic relationships in order to complete our
current product development and commercialization plans. We may also require partners to
assist in the distribution, servicing and supply of components for our anticipated fuel
cell products which are in development. If we are unable to identify or enter into
satisfactory agreements with potential partners, we may not be able to complete our
product development and commercialization plans on schedule or at all. We may also need to
scale back these plans in the absence of needed partners, which would adversely affect our
future prospects. In addition, any arrangement with a strategic partner may require us to
make large cash payments to the partner, issue a significant amount of equity securities
to the partner, provide the partner with the opportunity to have representation on our
board of directors, agree to exclusive purchase or other arrangements with the partner
and/or commit significant financial resources to fund our product development efforts in
exchange for their assistance or the contribution to us of intellectual property. Any such
issuance of equity securities would reduce the percentage ownership of our then current
stockholders. While we have entered into relationships with suppliers of some key
components for our products, we do not know when or whether we will secure supply
relationships for all required components and subsystems for our products, or whether such
relationships will be on terms that will allow us to achieve our objectives. Our business,
prospects, results of operations and financial condition could be harmed if we fail to
secure relationships with entities which can develop or supply the required components for
our products and provide the required distribution and servicing support. Additionally,
the agreements governing our current relationships allow for termination by our partners
under certain circumstances.
6
We
may rely on third parties to develop and provide key components for our battery and
energy related products.
We
may rely on third party suppliers to develop and supply key components that we will use
in our battery and energy related products. If those suppliers fail to develop and supply
these components in a timely manner or at all, or fail to develop or supply components
that meet our quality, quantity or cost requirements, and we are unable to obtain
substitute sources of these components on a timely basis or on terms acceptable to us, we
may not be able to manufacture our products. In addition, to the extent that our supply
partners use technology or manufacturing processes that are proprietary, we may be unable
to obtain comparable components from alternative sources.
We
do not know when or whether we will secure long-term supply relationships with any
suppliers or whether such relationships will be on terms that will allow us to achieve our
objectives. Our business, prospects, results of operations and financial condition could
be harmed if we fail to secure long-term relationships with entities that will supply the
required components for our battery and energy related products
We
face high levels of competition and may be unable to compete successfully.
The
markets in which we intend to compete are highly competitive. There are a number of
companies located in the United States, Canada and abroad that are developing battery and
fuel cell technologies and energy products that will compete with our technologies and
products. Some of our competitors are much larger than we are and may have the
manufacturing, marketing and sales capabilities to complete research, development and
commercialization of commercially viable products more quickly and effectively than we
can.
Not
only do we face competition from other companies that are developing battery and fuel cell
technologies, but we also face competition from companies that provide energy products
based on traditional energy sources, such as oil and natural gas. We also face competition
from companies that are developing energy products based on alternative energy sources as
a significant amount of public and private funding is currently directed toward
development of a number of types of distributed generation technology, including
microturbines, solar power, wind power and other types of fuel cell technologies.
Technological advances in alternative energy products or other fuel cell
technologies may make our products less attractive or render them
obsolete. There are many companies engaged in all areas of traditional and alternative
energy generation in the United States, Canada and abroad, including, among others, major
electric, oil, chemical, natural gas, batteries, generators and specialized electronics
firms, as well as universities, research institutions and foreign government-sponsored
companies. Many of these entities have substantially greater financial, research and
development, manufacturing and marketing resources than we do.
Failure
of our planned products to pass testing could negatively impact demand for our products.
We
may encounter problems and delays during testing of our products for a number of reasons,
including the failure of our technology or the technology of third parties, as well as our
failure to maintain and service our products properly. Many of these potential problems
and delays are beyond our control. Any problem or perceived problem with our product tests
could materially harm our reputation and impair market acceptance of, and demand for, our
products.
Regulatory
and other changes in the energy industry may adversely affect our ability to produce, and
reduce demand for, our products.
The
market for our technologies and products may be heavily influenced by federal, state,
local and foreign government laws, regulations and policies concerning the energy
industry. A change in the current regulatory policies could make it more difficult or
costly for us to develop, manufacture or market our products. Any such changes could also
deter further investment in the research and development of alternative energy sources,
including fuel cells, which could significantly reduce demand for our technologies and
products. We cannot predict how changes in regulation or other industry changes will
affect the market for our products or impact our ability to distribute, install and
service our products.
7
We
could be liable for environmental damages resulting from our research, development or
manufacturing operations.
Our
business exposes us to the risk that harmful substances may escape into the environment,
resulting in personal injury or loss of life, damage to or destruction of property, and
natural resource damage. Our insurance policies may not adequately reimburse us for costs
incurred in defending and settling environmental damage claims, and in some instances, we
may not be reimbursed at all. Our business is subject to numerous federal, state and local
laws and regulations that govern environmental protection and human health and safety.
These laws and regulations have changed frequently in the past and it is reasonable to
expect there will be additional changes in the future. If our operations do not comply
with current or future environmental laws and regulations, we may be required to make
significant unanticipated capital and operating expenditures to bring our operations into
compliance. If we fail to comply with applicable environmental laws and regulations,
governmental authorities may seek to impose fines and penalties on us or to revoke or deny
the issuance or renewal of operating permits and private parties may seek damages from us.
Under those circumstances, we might be required to curtail or cease operations, conduct
site remediation or other corrective action, or pay substantial damage claims.
Our
products may use materials that are inherently dangerous substances which could subject
our business to product liability claims.
Our
energy technologies and products may use hydrogen or other materials that could leak and
combust if ignited by another source. These technologies and products expose us to
potential product liability claims that are inherent in hydrogen and products that use
hydrogen. Hydrogen is a flammable gas and therefore a potentially dangerous product.
Hydrogen is typically generated from gaseous and liquid fuels that are also flammable and
dangerous, such as propane, natural gas or methane, in a process known as reforming.
Natural gas and propane could leak into a residence or commercial location and combust if
ignited by another source. In addition, our products may operate at high temperatures,
which could expose us to potential liability claims, in the event of accidents involving
combustion or explosion. Accidents involving our products or other hydrogen-based products
could materially impede widespread market acceptance and demand for, or heighten
regulatory scrutiny of, our products. In addition, we might be held responsible for
damages beyond the scope of our insurance coverage. We also cannot predict whether we will
be able to maintain our insurance coverage on acceptable terms.
Product
liability or defects could negatively impact our results of operations.
Any
liability we incur for damages resulting from malfunctions or design defects of our
products could be substantial and could materially adversely affect our business,
financial condition, results of operations and prospects. In addition, a publicized actual
or perceived problem could adversely affect the market's perception of our products
resulting in a decline in demand for our products and could divert the attention of our
management, which may materially and adversely affect our business, financial condition,
results of operations and prospects.
Future
acquisitions may disrupt our business, distract our management and reduce the percentage
ownership of our stockholders.
As
part of our business strategy we may seek to acquire complementary technologies, products,
channels, expertise and/or other valuable assets. However, we may not be able to identify
suitable acquisition candidates. If we do identify suitable candidates, we may not be able
to complete the acquisitions on commercially acceptable terms or at all. We may not be
able to successfully integrate the acquired business into our existing business in a
timely and non-disruptive manner. We may have to devote a significant amount of time and
management and financial resources to do so. Even with this investment of management and
financial resources, an acquisition may not produce the desired revenues, earnings or
business synergies. In addition, an acquisition may reduce the percentage ownership of our
then current stockholders. If we fail to integrate the acquired business effectively or if
key employees of that business leave, the anticipated benefits of the acquisition would be
jeopardized. The time, capital and management and other resources spent on an acquisition
that fails to meet our expectations could cause our business and financial condition to be
materially and adversely affected. In addition, as a result of any acquisition, we may
incur non-recurring charges and be required to amortize of significant amounts of
intangible assets, which could adversely affect our results of operations.
We
may not be able to protect the intellectual property upon which we depend and we could
incur substantial costs defending against claims that our products infringe on the
proprietary rights of others.
8
Our
ability to compete effectively will depend, in part, on our ability to protect our
proprietary technologies, systems designs and manufacturing processes. We rely on patents,
trademarks, and other policies and procedures related to confidentiality to protect our
intellectual property. However, some of our intellectual property is not covered by any
patent or patent application. Moreover, we do not know whether any of our pending patent
applications will issue or, in the case of patents issued or to be issued, that the claims
allowed are or will be sufficiently broad to protect our technology or processes. Even if
all of our patent applications are issued and are sufficiently broad, our patents may be
challenged or invalidated. We could incur substantial costs in prosecuting or defending
patent infringement suits or otherwise protecting our intellectual property rights. While
we have attempted to safeguard and maintain our proprietary rights, we do not know whether
we have been or will be completely successful in doing so. Moreover, patent applications
filed in foreign countries may be subject to laws, rules and procedures that are
substantially different from those of the United States, and any resulting foreign patents
may be difficult and expensive to enforce. In addition, we do not know whether the U.S.
Patent & Trademark Office will grant federal registrations based on our pending
trademark applications. Even if federal registrations are granted to us, our trademark
rights may be challenged. It is also possible that our competitors or others will adopt
trademarks similar to ours, thus impeding our ability to build brand identity and possibly
leading to customer confusion. We could incur substantial costs in prosecuting or
defending trademark infringement suits.
Further,
our competitors may independently develop or patent technologies or processes that are
substantially equivalent or superior to ours. If we are found to be infringing third party
proprietary rights, we could be required to pay substantial royalties and/or damages, and
we do not know whether we will be able to obtain licenses to use the intellectual property
at issue on acceptable terms, if at all. Failure to obtain needed licenses could delay or
prevent the development, manufacture or sale of our products, and could necessitate the
expenditure of significant resources to develop or acquire non-infringing intellectual
property.
Asserting,
defending and maintaining our intellectual property rights could be difficult and costly
and failure to do so may diminish our ability to compete effectively and may harm our
operating results. We may need to pursue lawsuits or legal action in the future to enforce
our intellectual property rights, to protect our trade secrets and domain names and to
determine the validity and scope of the proprietary rights of others. If third parties
prepare and file applications for trademarks used or registered by us, we may oppose those
applications and be required to participate in proceedings to determine priority of rights
to the trademark. Similarly, competitors may have filed applications for patents, may have
received patents and may obtain additional patents and proprietary rights relating to
products or technology that block or compete with ours. We may have to participate in
interference proceedings to determine the priority of invention and the right to a patent
for the technology. Litigation and interference proceedings, even if they are successful,
are expensive to pursue and time consuming, and we could use a substantial amount of our
financial resources in either case.
We
rely, in part, on contractual provisions to protect our trade secrets and proprietary
knowledge.
Confidentiality
agreements to which we are party may be breached, and we may not have adequate remedies
for any breach. Our trade secrets may also become known without breach of such agreements
or may be independently developed by competitors. Our inability to maintain the
proprietary nature of our technology and processes could allow our competitors to limit or
eliminate any competitive advantages we may have.
9
Our
business depends on retaining and attracting highly capable management and operating
personnel.
Our
success depends in large part on our ability to retain and attract management and
operating personnel, including our Chairman and Chief Executive Officer, Kevin P.
Fitzgerald, our officers and other key employees. Our business requires highly killed
specialized workforce, including scientists, engineers, researchers and manufacturing and
marketing professionals, who are in high demand and are often subject to competing offers.
To retain and attract key personnel, we use various measures, including employment
agreements, a stock incentive plan and incentive bonuses for key employees. These measures
may not be enough to retain and attract the personnel we need or to offset the impact on
our business of the loss of the services of Mr. Fitzgerald or other key officers or
employees.
We
face risks associated with our plans to market, distribute and service our products
internationally.
We
intend to market, distribute and service our products internationally. We have limited
experience developing and no experience manufacturing our products to comply with the
commercial and legal requirements of international markets. Our success in international
markets will depend, in part, on our ability and that of our partners to secure
relationships with foreign sub-distributors, and our ability to manufacture products that
meet foreign regulatory and commercial requirements. Additionally, our planned
international operations are subject to other inherent risks, including potential
difficulties in enforcing contractual obligations and intellectual property rights in
foreign countries and fluctuations in currency exchange rates.
Our government contracts could
restrict our ability to effectively commercialize our technology.
Some
of the technology we may be using has been or may be developed under government funding by the United States,
the terms of which may provide various rights including broad license rights to the United States government. Our
contracts with government agencies are also subject to the risk of termination at the
convenience of the contracting agency and potential disclosure of our confidential
information to third parties. Under the Freedom of Information Act, any documents that we
have submitted to the government or to a contractor under a government funding arrangement
may be subject to public disclosure that could compromise our intellectual property rights
unless these documents are exempted as trade secrets or as confidential information,
appropriately legended by us, and treated accordingly by such government agencies.
As
a government contractor, we must comply with and are affected by federal government
regulations relating to the formation, administration and performance of government
contracts. These regulations will affect how we do business with our customers and may
impose added costs on our business. Any failure to comply with applicable laws and
regulations could result in contract termination, price or fee reductions or suspension or
debarment from contracting with the federal government.
In
addition, Federal government agencies routinely audit government contracts. These agencies
review a contractor's performance on its contract, pricing practices, cost structure
and compliance with applicable laws, regulations and standards. These audits may occur
several years after completion of the audited work. An audit could result in a substantial
adjustment to our revenue because any costs found to be improperly allocated to a
specific contract will not be reimbursed, while improper costs already reimbursed must be
refunded. If a government audit uncovers improper or illegal activities, we may be subject
to civil and criminal penalties and administrative sanctions, including termination of
contracts, forfeiture of profits, suspension of payments, fines and suspension or
debarment from doing business with federal government agencies. In addition, our
reputation could be harmed if allegations of impropriety were made against us.
We may be unable to
manage rapid growth effectively.
We
expect to rapidly expand our manufacturing capabilities, accelerate the commercialization
of our products and enter a period of rapid growth, which will place a significant strain
on our senior management team and our financial and other resources. The proposed
expansion will expose us to increased competition, greater overhead, marketing and support
costs and other risks associated with the commercialization of a new product. Our ability
to manage our rapid growth effectively will require us to continue to improve our
operations, to improve our financial and management information systems and to train,
motivate and manage our employees. Difficulties in effectively managing the budgeting,
forecasting and other process control issues presented by such a rapid expansion could
harm our business, prospects, results of operations and financial condition.
10
Our
stock price has been and could remain volatile.
The
market price of our common stock has historically experienced and may continue to
experience significant volatility. In the twelve months ended December 31, 2003, our stock
closing price ranged from $0.03 to $1.73 per share. More recently, on January 26, 2004
our stock closing price was $1.40 per share. Our progress in developing and commercializing our
products, our quarterly operating results, announcements of new products by us or our
competitors, our perceived prospects, changes in securities' analysts'
recommendations or earnings' estimates, changes in general conditions in the economy
or the financial markets, adverse events related to our strategic relationships and other
developments affecting us or our competitors could cause the market price of our common
stock to fluctuate substantially. In addition, in recent years, the stock market, and in
particular the market for technology-related stocks, has experienced significant price and
volume fluctuations. This volatility has affected the market prices of securities issued
by many companies for reasons unrelated to their operating performance and may adversely
affect the price of our common stock. In addition, we may be subject to additional
securities class action litigation as a result of volatility in the price of our common
stock, which could result in substantial costs and diversion of management's
attention and resources and could harm our stock price, business, prospects, results of
operations and financial condition.
Our principal
stockholder has substantial control over our affairs.
Ener1
is controlled by Ener1 Group, Inc., which owns approximately 93% of our outstanding common
stock. Two of Ener1 Group's board members are also members of our Board of Directors.
Ener1 Group has the ability to exert substantial influence over all matters submitted to a
vote of the stockholders of Ener1, including the election and removal of directors and any
merger, consolidation or sale of all or substantially all of our assets. In addition,
Ener1 Group may dictate the management of our business and affairs. This concentration of
ownership could have the effect of delaying, deferring or preventing a change in control
or impeding a merger or consolidation, takeover or other business combination which you,
as a stockholder, may otherwise view favorably.
Future
sales of our common stock may adversely affect our common stock price.
If
our stockholders sell a large number of shares of common stock or if we issue a large
number of shares in connection with future acquisitions or financings, the market price of
our common stock could decline significantly. In addition, the perception in the public
market that our stockholders might sell a large number of shares of common stock could
cause a decline in the market price of our common stock.
Our
certificate of incorporation and Florida law could adversely affect our common stock
price.
Provisions of our certificate of
incorporation and Florida law could discourage potential acquisition proposals and could
delay or prevent a change in control of us. These provisions could diminish the
opportunities for a stockholder to participate in tender offers, including tender offers
at a price above the then current market value of our common stock. These provisions may
also inhibit fluctuations in the market price of our common stock that could result from
takeover attempts. In addition, the Board of Directors, without further stockholder
approval, may issue additional series of preferred stock that could have the effect of
delaying, deterring or preventing a change in control of us. The issuance of additional
series of preferred stock could also adversely affect the voting power of the holders of
common stock, including the loss of voting control to others.
11
Cautionary Statement
About Forward-Looking Statements
Some
of the information in this reoffer prospectus may contain "forward-looking
statements," within the meaning of the Federal Private Securities Litigation Reform
Act of 1995. These statements can be identified by the use of forward-looking words such
as "may," "will," "expect," "anticipate,"
"estimate," "continue" or other similar words. These statements
discuss plans, goals and objectives for future operations and growth, contain projections
of results of operations or financial condition or state other "forward-looking"
information. You should understand that these forward-looking statements are necessarily
estimates reflecting our judgment, not guarantees of future performance. They are subject
to a number of assumptions, risks and uncertainties that could cause actual results to
differ materially from those expressed or implied in the forward-looking statements. The
following important factors, in addition to those discussed in "Risk Factors"
and other unforeseen events or circumstances, could affect our future results and could
cause those results or other outcomes to differ materially from those expressed or implied
in our forward-looking statements: general economic conditions; competition; our ability
to control costs; changes within our industries; our ability to successfully complete our
research and development initiatives; release of new and upgraded products and services by
us or our competitors; development of our sales force; employee retention; managerial
execution; legal and regulatory issues; changes in accounting policies or practices; and
successful adoption of our products and services.
Accordingly,
you should not place undue reliance on forward-looking statements, which speak only as of
the date of this reoffer prospectus. All subsequent written and oral forward-looking
statements attributable to us or any person acting on our behalf are expressly qualified
in their entirety by the cautionary statements contained or referred to in this section.
We do not undertake any obligation to release publicly any revisions to these
forward-looking statements to reflect events or circumstances after the date of this
reoffer prospectus or to reflect the occurrence of unanticipated events.
USE OF PROCEEDS
We
will not receive any proceeds from the sale of up to 1,030,000 shares of common stock by
the Selling Stockholders.
12
SELLING STOCKHOLDERS
The
following table sets forth information known to us with respect to the number of shares of
common stock beneficially owned by the Selling Stockholders named below and as adjusted to
give effect to the sale of the shares offered by this reoffer prospectus. The information
in the table below is current as of the date of this reoffer prospectus. The Selling
Stockholders may from time to time offer and sell pursuant to this reoffer prospectus any
or all of the common stock being registered.
We
determined beneficial ownership in accordance with rules promulgated by the SEC, and the
information is not necessarily indicative of beneficial ownership for any other purpose.
Except as other indicated, we believe that the persons or entities named in the following
table have sole voting and investment power with respect to all shares of common stock as
beneficially owned by them, subject to community property laws where applicable. To
prevent dilution to the Selling Stockholders, the following numbers may change because of
stock splits, stock dividends or similar events involving our common stock.
The
number of shares in the column labeled "Shares Being Offered" represent all of
the shares that each Selling Stockholder may offer under this reoffer prospectus. The
table assumes that the Selling Stockholders sell all of the shares. We are unable to
determine the exact number of shares that actually will be sold. We do not know how long
the Selling Stockholders will hold the shares before selling them and we currently have no
agreements, arrangements or understandings with any of the Selling Stockholders regarding
the sale of any of the shares.
Name and Address
Positions,
Offices or
Relationships
with Ener1
During Past 3
Years
Shares Owned as
of the Date of
this Reoffer
Prospectus
Shares Being
Offered
Shares Owned
After Offering
Percentage of
Class Owned
After Offering
Kevin P.
Fitzgerald(1)
Karl Gruns(1)
Ronald N. Stewart(1)
Larry L. Light(2)
Alla Rozengurt(3)
Byron Buntin(4)
Olga Morkovina(5)
Sergey Kaplan(6)
Director,
Chairman, Chief
Executive Officer
Director
Executive Vice
President,
Director,
General Counsel and
Secretary
Chief Executive
Officer,
EnerLook
Solutions, Inc.
Vice President
of Business
Development,
EnerLook
Solutions, Inc.
Employee
Employee
Employee
2,189,363(7)
142,000
370,000
240,000
205,000
70,000
70,000
70,000
300,000
50,000
300,000
100,000
70,000
70,000
70,000
70,000
1,889,363
92,000
70,000
140,000
130,000
-0-
-0-
-0-
*
*
*
*
*
*
*
*
13
*     Less than one percent.
1.
The address for each of Messrs. Fitzgerald, Gruns and Stewart is c/o Ener1,
          Inc., 550 W. Cypress Creek Road, Suite 120, Ft. Lauderdale, FL, 33309.
2.
Mr.
          Light's address is 381 SE 11 Street, Pompano Beach, FL, 33060.
3.
Ms. Rozengurt's address is 328 Poinciana Island, North Miami, FL, 33160.
4.
Mr. Buntin's address is 1309 Fulmar Drive, Delray Beach, FL, 33444.
5.
Ms. Morkovina's address is 3020 NE 32 Avenue 
           Apt. #1421 Ft. Lauderdale, Fl 33308.
6.
Mr. Kaplan's address is 3640
          Yacht Club Drive, Apt. #1703,  Aventura, Fl 33180.
7.
Includes 1,889,363 shares that may be acquired by Mr. Fitzgerald within 60 days of
          the date of this reoffer prospectus upon the exercise of vested options.
14
PLAN OF DISTRIBUTION
We
will not receive any proceeds from the sale of the shares covered by this reoffer
prospectus. The shares are being offered on behalf of the Selling Stockholders. The shares
may be sold or distributed from time to time by the Selling Stockholders, or by pledgees,
donees or transferees of, or other successors in interest to, the Selling Stockholders,
directly to one or more purchasers (including pledgees) or through brokers, dealers or
underwriters who may act solely as agents or who may acquire the shares as principals, at
market prices prevailing at the time of sale, at prices related to such prevailing market
prices, at negotiated prices, or at fixed prices, which may be changed.
The
sale of the shares may be effected in one or more of the following methods:
o
o
o
o
o
o
o
on any national securities exchange or quotation service on which our common
stock may be listed
or quoted at the time of sale;
in the over-the-counter market;
in transactions otherwise than on such exchanges or services in the
over-the-counter market;
through the writing of options, whether the options are listed on an
option exchange or otherwise;
in an exchange distribution in accordance with the rules of the
applicable exchange;
or through the settlement of short sales; or
through privately negotiated transactions.
In addition, any shares that qualify
for resale pursuant to Rule 144 of the Securities Act of 1933, as amended (the
"Securities Act") may be sold under Rule 144 of the Securities Act rather than
pursuant to this prospectus.
These
transactions may include crosses or block transactions. Crosses are transactions in which
the same broker acts as agent on both sides of the trade.
In
addition, the Selling Stockholders or their successors in interest may enter into hedging
transactions with broker-dealers who may engage in short sales of the shares in the course
of hedging the positions they assume with the Selling Stockholders. The Selling
Stockholders or their successors in interest may also enter into option or other
transactions with broker-dealers that require the delivery by such broker-dealers of the
shares which may be resold under this reoffer prospectus.
Brokers,
dealers, underwriters or agents participating in the distribution of the shares as agents
may receive compensation in the form of commissions, discounts or concessions from the
Selling Stockholders or purchasers of the shares for whom such broker-dealers may act as
agent, or to whom they may sell as principal, or both (which compensation as to a
particular broker-dealer may be less than or in excess of customary commissions).
The
staff of the SEC is of the view that selling security holders who are registered broker
dealers or affiliates of registered broker dealers may be underwriters under the
Securities Act. The SEC is also of the view that any broker-dealers who act in connection
with the sale of shares under this reoffer prospectus may be deemed to be
"underwriters" within the meaning of the Securities Act, and any commissions
they receive and proceeds they receive from any sale of shares may be deemed to be
underwriting discounts and commissions under the Securities Act. Neither we nor any
Selling Stockholder can presently estimate the amount of such compensation. We will not
pay any compensation or give any discounts or commissions to any underwriter in connection
with the securities being registered in this reoffer prospectus. We know of no existing
arrangements between any Selling Stockholder, any other stockholder, broker, dealer,
underwriter or agent relating to the sale or distribution of the shares.
The
anti-manipulation rules under the Exchange Act may apply to sales of shares in the market
and to the activities of the Selling Stockholders and their affiliates. The Selling
Stockholders may not effect any sale or distribution of the shares until after this
reoffer prospectus has been appropriately amended or supplemented, if required.
The
Selling Stockholders may indemnify any broker-dealer that participates in transactions
involving the sale of the shares against certain liabilities, including liabilities
arising under the Securities Act, as amended. Any commissions paid or any discounts or
concessions allowed to any such broker-dealers, and any profits received on the resale of
such shares, may be deemed to be underwriting discounts and commissions under the
Securities Act, as amended if any such broker-dealers purchase shares as principal.
15
We
can not assure you that the Selling Stockholders will sell any of the shares offered by
this reoffer prospectus. The amount of securities that may be sold by a Selling
Stockholder under this reoffer prospectus may not exceed, during any three month period,
the amount set forth in Rule 144(e) under the Securities Act.
We
will pay all expenses in connection with this offering, other than any underwriting
discounts and commissions, which will be paid by the Selling Stockholders.
Legal Matters
Ronald
Stewart will opine as to the validity of the common stock offered by this reoffer
prospectus.
Experts
The
consolidated financial statements of Ener1 as of December 31, 2002 and for the two years
in the period ended December 31, 2002 incorporated by reference in this registration
statement have been audited by Kaufman, Rossin & Co., independent certified public
accountants, as set forth in their report dated February 28, 2003 (except for Note 15, as
to which the date is April 2, 2003 and Note 8, as to which the date is April 14, 2003), and
are included in reliance upon such report given upon the authority of said firm as experts
in accounting and auditing.
16
PART II
INFORMATION REQUIRED
IN THE REGISTRATION STATEMENT
Item 3. Incorporation of
Documents by Reference
The
Registrant hereby incorporates by reference into this Registration Statement the following
documents previously filed with the Securities and Exchange Commission (the
"SEC"):
(a)
Ener1, Inc.'s Annual Report on Form 10-KSB for the year ended December 31,
          2002 as amended pursuant to the 10-KSB/A filed with the SEC on April 30, 2003.
(b)
Ener1, Inc.'s Quarterly Reports on Form 10-QSB for the quarters ending
          March 31, 2003, June 30, 2003 and September 30, 2003, respectively.
(c)
Ener1, Inc.'s Current Report on Form 8-K filed with the SEC on January 21, 2004.
(d)
The description of the Registrant's common stock contained in the
          Registrant's Current Report on Form 8-K filed with the SEC on February 6,
          2004.
All
documents filed pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 (the "Exchange Act") after the date of this Registration
Statement and prior to the filing of a post-effective amendment which indicates that all
securities offered hereby have been sold or which deregisters all securities then
remaining unsold shall be deemed to be incorporated by reference into this Registration
Statement and to be a part hereof from the date of filing of such documents.
Any
document, and any statement contained in a document, incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded for purposes
of this Registration Statement to the extent that a statement contained herein, or in any
other subsequently filed document that also is incorporated or deemed to be incorporated
by reference herein, modifies or supersedes such document or statement. Any such document
or statement so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Registration Statement. Subject to the foregoing,
all information appearing in this Registration Statement is qualified in its entirety by
the information appearing in the documents incorporated by reference.
Item 4. Description of
Securities
Not Applicable.
Item 5. Interests of
Named Experts and Counsel
Not Applicable.
Item 6. Indemnification
of Directors and Officers
Pursuant
to Section 607.0850 of the Florida Statutes, the Registrant has the power to indemnify any
person made a party to any lawsuit by reason of being a director or officer of the
Registrant, or serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was unlawful.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers or persons controlling the Registrant pursuant to the
foregoing provisions, the Registrant has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is therefore unenforceable.
17
The
Registrant's Amended and Restated Articles of Incorporation and By-laws provide that
the Registrant shall indemnify its directors and officers to the fullest extent permitted
by Florida law.
The
Registrant has purchased insurance with respect to, among other things, the liabilities
that may arise under the statutory provisions referred to above. The directors and
officers of the Registrant also are insured against certain liabilities, including certain
liabilities arising under the Securities Act of 1933, which might be incurred by them in
such capacities and against which they are not indemnified by the Registrant.
The
Registrant has entered into separate indemnification agreements with its directors and
officers. The indemnity agreements create certain indemnification obligations of the
Registrant in favor of the directors and officers and, as permitted by applicable law,
will clarify and expand the circumstances under which a director or officer will be
indemnified.
Item 7. Exemption from
Registration Claimed
With respect to the
restricted securities being offered by this registration statement, the
Registrant claimed exemptions from registration in accordance with Section 4(2) of the
Securities Act of 1933 for shares of common stock previously issued under various
agreements between the Registrant and the Selling Stockholders. These exemptions were
available to the Registrant for the issuance of the shares of common stock because the
issuances did not involve a public offering, advertising or general solicitation. The
shares were issued to 7 persons, each of whom had a pre-existing relationship with the
Registrant as either a director, officer or employee of the Registrant.
Item 8. Exhibits
Exhibit Number
Description
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
23.1
24.1
Articles of Incorporation of the Registrant incorporated by reference to Exhibit 3(i) to the Registrant's Quarterly Report
on Form 10-Q for the quarter ended September 30, 2000 (No. 000-21138).
Amendment to Articles of Incorporation incorporated by reference to Exhibit 3.2 to the Registrant's Annual Report on Form
10-K for the year ended December 31, 2001 (No. 000-21138).
Amendment to Articles of Incorporation incorporated by reference to Exhibit 3.1 to the Registrant's current report on Form
8-K dated October 28, 2002 (No. 000-21138).
By-Laws of the Registrant incorporated by reference to Exhibit 3.4 to the Registrant's Quarterly Report on Form 10-QSB filed
November 14, 2003.
Form of Stock Option Agreement under Ener1, Inc. 2002 Stock Participation Plan.
Employment Agreement by and between the Registrant and Kevin P. Fitzgerald incorporated by reference to Exhibit 10.6 of
the Registrant's Quarterly Report on Form 10-Q filed November 14, 2003.
Investment Agreement dated as of January 1, 2003 by and between the Registrant and Karl Gruns.
Stock Award Agreement dated as of May 16, 2003 by and between the Registrant and Ronald D. Stewart.
Stock Award Agreement dated as of May 16, 2003 by and between the Registrant and Larry L. Light.
Consent of Kaufman, Rossin & Co.
Power of Attorney (included on the signature pages to this Registration Statement on Form S-8).
18
Item 9. Undertaking
The undersigned Registrant hereby undertakes:
(1) to
file, during any period in which offers or sales are being made, a post-effective
amendment to this Registration Statement (i) to include any prospectus required by
Section 10(a)(3) of the Securities Act; (ii) to reflect in the prospectus any
facts or events arising after the effective date of this Registration Statement (or the
most recent post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement; and (iii) to include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any material
change to such information in this Registration Statement;
provided
, however, that
clauses (1)(i) and (l)(ii) shall not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference into this Registration Statement;
(2) that
for the purpose of determining any liability under the Securities Act, each such
post-effective amendment shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof; and
(3) to
remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold upon the termination of the offering.
19
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the Registrant certifies that it has
reasonable grounds to believe that it meets all of the requirements for filing on
Form S-8 and has duly caused this Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Ft. Lauderdale, State of
Florida, on the 4th day of February 2004.
ENER1, INC.
By:
/s/ Kevin P. Fitzgerald
Kevin P. Fitzgerald
Chief Executive Officer
POWER OF ATTORNEY
KNOW
ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes
and appoints Ronald Stewart and Kevin P. Fitzgerald, and each of them, his or her true and
lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for
him or her and in his or her name, place and stead, in any and all capacities, to sign any
and all amendments (including post-effective amendments) to this Registration Statement,
and to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or
their or his substitutes or substitute, may lawfully do or cause to be done by virtue
hereof.
Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement has been
signed below by the following persons in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Kevin P. Fitzgerald
Kevin P. Fitzgerald
/s/ Randall Paulfus
Randall Paulfus
/s/ Boris Zingarevich
Boris Zingarevich
/s/ Karl Gruns
Karl Gruns
/s/ Mike Zoi
Mike Zoi
/s/ Dr. Peter Novak
Dr. Peter Novak
/s/ Ronald N. Stewart
Ronald N. Stewart
Chief Executive Officer and Director
and Chairman of the Board (Principal
Executive Officer)
Chief Financial Officer (Principal
Financial Officer & Principal
Accounting Officer)
Director
Director
Director
Director
Director
February 4, 2004
February 4, 2004
February 4, 2004
February 4, 2004
February 4, 2004
February 4, 2004
February 4, 2004
EXHIBIT INDEX
Exhibit Number
Exhibit
4.5
4.7
4.8
4.9
23.1
24.1
Form of Stock Option Agreement under Ener1, Inc. 2002 Stock Participation Plan.
Investment Agreement dated as of January 1, 2003 by and between the Registrant and Karl Gruns.
Stock Award Agreement dated as of May 16, 2003 by and between the Registrant and Ronald D. Stewart.
Stock Award Agreement dated as of May 16, 2003 by and between the Registrant and Larry L. Light.
Consent of Kaufman, Rossin & Co.
Power of Attorney (included on the signature pages to this Registration Statement on Form S-8).