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EXHIBIT A The WWU VRI will use its resources to develop a composite, low-floor bus body and an appropriate power plant that achieves the critical objectives and standards in such areas as safety, space utilization, operating efficiency, service effectiveness, and environmental impacts. The WWU Office of Sponsored Programs will collaborate with the WWU Foundation to procure public and private funding for the vehicle research and development. The Partnership will support WWU efforts to secure funding for Research and Development of the prototype(s)by providing letters of support for grant applications and, as "Program Administration and Coordination" funding is deemed available by the Partnership, potential contributions for grant matching funds. KT will provide or assist the WWU VRI with the mechanical and electric drive components, and, if possible, an end-of-life electric vehicle similar to those in use in Chattanooga or Santa Barbara to study for development of the new vehicle. The first prototype vehicle(s) will be developed by the WWU VRI to assess "Proof of Concept." The testing of the initial prototype(s) may include operational evaluations by transit agency members of the Partnership; however, these vehicles would not be intended for use in carrying public passengers in revenue service. Following an evaluation of the first "Proof of Concept" prototype test results, the Partnership will establish the direction for "Phase II," including the requirements for continued participation on the part of the partners. Any member of the partnership may choose to opt out at the end of Phase I or choose to continue on into Phase II. PHASE II—Prototype Refinement, Testing, and Mass Production The primary objectives of Phase II are: o To continue to refine the First "Proof of Concept" Prototype(s) developed in Phase I and continue the testing of subsequently refined prototype vehicles—such testing may include operational simulations at volunteering partner agencies and federal "Altoona"testing; and o To facilitate the production of the approved prototype vehicle(s) with one or more manufacturing partners. This production would result in a run of vehicles for purchase by members of the partnership and other interested parties. The parties agree that this is a preliminary agreement and that further, more definitive agreements will follow. All Partnership agreements shall be reviewed annually for necessary changes as the program develops.