Ener1 Inc. Obtains New Financing From Majority Shareholder Ener1 Group to Provide $3.0 Million Through Long Term Convertible

Subordinated Notes

    FT. LAUDERDALE, Fla., June 30 /PRNewswire-FirstCall/ -- Ener1, Inc.
 (OTC Bulletin Board:   ENEI) announced today that it has obtained additional
 long term financing from its majority shareholder, privately held Ener1
 Group, Inc., to fund the Company's ongoing operations. The $3.0 million
 financing consists of 10% convertible subordinated notes with no principal
 or interest payments until maturities of the notes in 2009, plus warrants.
     Ener1 Inc. Chairman Charles Gassenheimer commented, "The continued vote
 of confidence of our majority shareholder is an indication of their faith
 in our technologies, and in the potential rewards of the markets we will
 serve -- primarily Hybrid Electric Vehicles and Hydrogen Fuel Cells for
 transportation and other purposes. We appreciate this new financing, and
 look forward to achieving major milestones this year in both our principal
 planned product lines."
     The new financing follows on $5.52 million in equity financing
 announced by the Company in February of this year and which was provided
 over the last several months from Ener1 Group's exercise of 69 million $.08
 warrants originally issued in 2002, which warrant financing was also
 recently completed. Pursuant to the Company's agreement with Ener1 Group
 for the warrant financing, as filed with the SEC, at the completion of the
 warrant financing, the Company issued to Ener1 Group 20 million immediately
 exercisable, ten-year warrants to purchase shares of the Company's common
 stock at $.50 per share.
     The notes are subordinated in all respects to the rights of the holders
 of the Company's senior secured convertible debentures due 2009, issued in
 2004 and 2005. The notes are convertible into shares of Ener1, Inc. common
 stock at $.50 per share at the election of the holder. In connection with
 the notes, the Company issued nine million immediately exercisable, five
 year warrants to purchase shares of the Company's common stock at an
 exercise price of $.50 per share.
     The new convertible subordinate note financing brings the Company's
 total financing from Ener1 Group to approximately $8.4 million over the
 last several months, reflecting the increased level of attention and
 support from the Company's majority shareholder that has followed the
 Company's management reorganization of Ener1 in the beginning of this year.
     About Ener1, Inc.
     Ener1, Inc. (OTC Bulletin Board:   ENEI) is an alternative energy
 technology company. The company's interests include: 80.5% of EnerDel
 (www.enerdel.com), a lithium battery company in which Delphi Corp. owns
 19.5%; 48% of Enerstruct, a Japanese lithium battery technology company in
 which Ener1's strategic investor ITOCHU owns the majority interest; wholly
 owned subsidiary EnerFuel, a fuel cell products and services company
 (www.enerfuel.com); and wholly owned subsidiary NanoEner, which develops
 nanotechnology-based materials and manufacturing processes for batteries
 and other applications (www.nanoener.com). For more information, visit
     Safe Harbor Statement This release contains forward-looking statements
 within the meaning of the Federal Private Securities Litigation Reform Act
 of 1995 conveying management's expectations as to the future based on
 plans, estimates and projections at the time the statements are made. The
 forward- looking statements contained in this press release involve risks
 and uncertainties, including, but not necessarily limited to, EnerDel's
 ability to succeed as a supplier of batteries to the hybrid electric
 vehicle and other markets; Ener1's ability to successfully develop and
 market proposed lithium battery, fuel cell and nanotechnology-based
 products and services; the degree of competition in the markets for lithium
 battery, fuel cell and nanotechnology-based products and services, Ener1's
 history of operating losses, the lack of operating history for the
 development stage Ener1 businesses, the need for additional capital, the
 dependency upon key personnel and other risks detailed in its filings from
 time to time with the Securities and Exchange Commission. These risks and
 uncertainties could cause actual results or performance to differ
 materially from any future results or performance expressed or implied in
 the forward-looking statements included in this release. Ener1 undertakes
 no obligation to publicly update or revise any forward-looking statements,
 whether as a result of new information, future events, or otherwise.
     Contact:  Joe Allen (investors)        Alys Daly
               Allen & Caron Inc.           Ener1, Inc.
               212 691 8087                 954 202 4442 or 305 815-0312
               joe@allencaron.com           adaly@ener1.com

SOURCE Ener1, Inc.

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