September 6, 2002

Bob Garzee
Synergy Ev, Inc.
P.O.Box 35543
Monte Sereno, CA 95030-0543

Dear Bob:

We are nearing an end to the electronic-hybrid bus project contract between Synergy EV, Inc. and Silicon Valley Power, the municipal electronic utility of the city of Santa Clara.

We appreciate the service Synergy EV has provided in project mangement technical services and operations management. Synergy EV has been an asset in providing bus specification and purchasing expertise, manufacturing audits, testing, training and delivery of the completed buses. Synergy helped the City take the buses from the concept/design phase to its end goal of picking up passengers on successful routes.

After discussions with Serendipity Land Yachts, Ltd., please feel free to remove Synergy's equipment and insurance for these contracts effective September 30, 2002.

Public Benefits Coordinator
Silicon Valley Power
City of Santa Clara

September 6, 2002

Bob Garzee
Synergy Ev, Inc.
P.O.Box 35543
Monte Sereno, CA 95030-0543

Dear Bob:

Attached for your review is a copy of Silicon Valley Power's annual report. Please note that the BEE is mentioned in several places and is pictured, as well.

We appreciate Synergy's effort in the project and wish you and the entire company the best of luck in the future.

Public Benefits Coordinator
Silicon Valley Power
City of Santa Clara

Silicon Valley Buses
BEE riders keep Silicon Valley humming

Taken from: EV's in Transit

Commuters take comfortable hybrid-electronic buses to their jobs in Santa Clara.

Employees of Silicon valley companies like Intel, Applied Materials, Nvidia and Underwriters' Laboratories, Inc. are buzzing about a convenient new way to get to work. They take the train from the outlying towns where they live to the city of Santa Clara, and then transfer to the "Breath Easy Express" (BEE, for short).

The BEEs, three 30-foot, low emission hybrid-elecrtric buses manufactured by Advanced Vehicle systems, Inc. run during the peak commuter hours of 6 to 9:30 a.m. and 3 to 6:00 p.m., Monday through Friday. Each bus has 31 seats and room for nine standees. The buses have been running with 500 riders a week on two routes.

The shuttle program is sponsored by Silicon Valley Power (SVP), the city's electronic utility, as part of it's public benefits program. Three BEE buses were put into service at the request of high.tech employers in the area. The employers pay for the buses through their electronic bill, so their employees can ride for free.

"People like the buses," observes Joyce Kinnear, who manages new technology programs at Silicon Valley Power. "They're very comfortable, with plush upholstered seats and coffe cup holders. The same driver has been driving on each route since the buses started. The drivers are very knowledgeable and know the routes very well. People are pleased with the route, the buses and the service."

Surprisingly, the BEE's environmental benefits are not the biggest issue for riders, according to Ms. Kinnear, although many engineers are interested in "the cool new technology."

The Breath Easy Express came about as a way to reduce air and noise pollution while relieving traffic congestion, Ms. Kinnear said. "We wanted to show other cities and transit authorities in the San Francisco Bay area that electronic vehicles can replace standard diesel buses."

The buses, which can travel up to 120 miles a day, are charged during off-peak night hours. The buses are primarily electronic, but also have two Capstone MicroTurbines powered by propane, which recharge the batteries. The MicroTurbines make the BEE's emision s far less than those of conventional diesel buses. The BEE can travel over 50 miles per hour, providing a fast, quiet ride to work.

After receiving the BEE buses in November 2001, Santa Clara took them out of service to make changes in the propane system. "We didn't want diesel," Ms. Kinnear said. "We had issues with the quality of the propane and the vaporization of the fuel before it reached the turbines." After the propane industry helped to resolve these issues, Santa Clara put the buses in service in May 2002.