RIDGEWOOD ZAP, LLC
     947 Linwood Avenue
     Ridgewood, New Jersey  07450


as of March 29, 1999


Gary Starr, Managing Director
ZAP Power Systems, Inc.
117 Morris Street
Sebastopol, California  95472

Re:     Common Stock Purchase Warrant

Dear Gary:

This letter  agreement is intended to constitute a binding contract with respect
to our obligation to the exercise of the Common Stock Purchase  Warrant dated as
of March 29, 1999 (the  "Warrant") for the purchase of Common Stock of ZAP Power
Systems, Inc.

We hereby agree that the Warrant shall be exercised totally for all shares,  not
partially,  prior to December 29, 1999  ("Exercise  Date") if, in the reasonable
judgment of the Warrantholder,

1.     The Company has not experienced a material adverse change in its 
financial condition or business prospects; and

2.     The Company has satisfied the following milestones of performance:

(a)  Completion of the  acquisition  of a model bike rental unit which has gross
income of at least $400,000 per annum for the last two calendar years;

(b) Completion of at least three of the following six joint marketing agreements
that  are  currently  being  pursued  by the  Company:  MTV  Networks;  Baywatch
Television Series; Ford Motor Company; KOA, Disney and Huffy Bikes; and

(c) Completion of the following  financial  milestones for the period commencing
on January 1, 1999: Net Sales of $8,500,000; Gross Profit of $2,500,000; and Net
Profit of $350,000.


In the event that we wish to exercise the Warrant  before the Exercise  Date, we
will notify you of the proposed exercise date and you agree to furnish us with a
written  certification from you, as Managing Director of ZAP Power Systems, that
the conditions set forth above have been  satisfied.  To the extent  required by
us, you also agree to furnish us with copies of joint  marketing  agreements and
with a balance  sheet dated within 30 days prior to the proposed  exercise  date
and an income  statement for the 12-month  period ending within 30 days prior to
the proposed exercise date.

Unless we have  exercised the Warrant  sooner,  you agree to furnish us with the
information  referenced in the preceding  paragraph  within 20 days prior to the
Exercise Date. If the conditions set forth in paragraphs  numbered 1 and 2 above
are met, in our reasonable judgment,  we will exercise the Warrant in accordance
with the procedures set forth in the Warrant.

This  letter  agreement  shall be  deemed  a  contract  governed  by the laws of
California.  Please  countersign  below as an indication of your  acceptance and
approval of the terms of this letter.

Sincerely yours,

RIDGEWOOD ZAP, LLC
By: Ridgewood Management Corporation
its Manager


By:_____________________
Authorized Agent
Accepted and Agreed:

ZAP POWER SYSTEMS


By:_____________________
Authorized Agent

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