First eBay Auction for U.S.-Compliant Smart Car from ZAP Closes at $35,350 After Strong Bidding Competition

Auction Proceeds to Go to American Lung Assoc. and U.C. Davis Institute of Transportation Studies

SANTA ROSA, Calif.June 27, 2005; pioneering the next generation of advanced transportation and energy technologies, announced today that its eBay auction for the first U.S.-compliant Smart Car available to the general public closed on Saturday evening on a winning bid of $35,350 placed by a businessman and microcar enthusiast who lives in Phoenix, Arizona.

The winning bidder, Roberto Hernandez, has been intent on obtaining a fuel-efficient Smart Car since seeing one earlier this year during a trip to Europe. "We're glad that ZAP took the initiative to bring these cars to the U.S. and convert them for use in this country," he said. "The gas-mileage is great, but we also love the style and design, and especially the small size, which makes it incredibly easy to find parking almost anywhere. Through ZAP, my dream to own a Smart Car has come true."

Mr. Hernandez has been a microcar fan since his teenage years, when his father gave him a gift of a BMW Isetta. He owns a few other microcar models, as well, but said the new Smart Car will become the jewel in his collection, and his main form of fuel-efficient microcar transportation.

The eBay auction of the Smart Car Americanized by ZAP attracted more than 29,000 viewers, and 71 bids. Along with the fuel-efficient Smart Car, Mr. Hernandez will receive a one-year supply of gasoline, a five-year, 75,000 mile nationwide warranty and free shipping. ZAP will donate 100% of the proceeds of the auction to charity, after cost of marketing.

Mr. Hernandez will also receive a surprise addition to his purchase: halfway through the auction, actor and European Smart Car owner and enthusiast Rutger Hauer met with ZAP CEO Steve Schneider and donated his signature to the charity auction. Mr. Hauer and Mr. Schneider shared their strong enthusiasm for the Smart Car and advanced transportation during the meeting, and discussed plans to collaborate on future marketing efforts. Mr. Hauer, who is currently appearing in the Warner Bros. feature film "Batman Begins" and recently in "Sin City," owns a Smart Car in Europe that he uses in conjunction with his motor home while he is out on the road. Mr. Hauer is active in providing help, attention and care to children and pregnant women with HIV/AIDS, as well as educating communities about the disease with his Rutger Hauer Starfish Association. For more information, visit his official website, http://www.rutgerhauer.org.

"This auction is the latest demonstration of the U.S. drivers' interest in the advanced transportation capabilities presented by the Smart Car Americanized by ZAP," said Steve Schneider, CEO of ZAP. "I don't know how many cars on the market today would have attracted so many interested buyers, but it appears clear that the Smart Car has already become a product in demand even now, at the very start of our national distribution phase."

To underscore its commitment to the need for advanced transportation solutions to enhance air and environmental quality, ZAP will split the proceeds of the eBay auction with The American Lung Association and the U.C. Davis Institute of Transportation Studies.

ZAP auctioned the Smart Car on eBay to raise awareness of its marketing strategy to expand its dealer network for fuel-efficient, low-emission and advanced technology vehicles. ZAP recently reported that it is preparing to deliver U.S. certified Smart Cars to qualified dealers in eight states and is organizing service training to prepare for nationwide sales. The first Americanized Smart Car was delivered to a Nevada purchaser recently as a "proof of concept" for ZAP that attracted international media attention and widespread interest from potential new consumers.

ZAP is now establishing a distribution portal and hub of automotive dealerships in the United States that cater to car-buyers looking for the next generation in automotive fuel technologies, including zero-emission electric vehicles, hydrogen fuel cell technology, and other energy-efficient, low-emission and advanced technologies. The Smart Car is one of several vehicles that ZAP is planning to offer through this distribution network.