Azure Dynamics Announces Terms of Offering of Common Shares

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

OAK PARK, Michigan, December 15 - Azure Dynamics Corporation (TSX: AZD) -
("Azure" or the "Company"), an industry leader in the development of hybrid
electric and electric technologies for commercial vehicles, announced today
that it has finalized the terms of its previously announced offering of
common shares of the Company ("Common Shares").

Azure has entered into an agency agreement with a syndicate of agents led
by Raymond James Ltd., and including Cormark Securities Inc., Stonegate
Securities, Inc. and Paradigm Capital Inc. (collectively, the "Agents"),
pursuant to which the Agents have agreed to sell, on a "best efforts" basis,
a minimum of 83,333,333 Common Shares at a price of $0.18 per Common Share
(the "Offering Price") for minimum total gross proceeds to the Company of
$15,000,000 and up to a maximum of 166,666,667 Common Shares at the Offering
Price for maximum total gross proceeds to the Company of up to $30,000,000
(the "Offering").

A final prospectus containing important information with respect to the
Offering has been filed with the securities regulatory authorities in each of
the provinces of Canada.

The Offering is scheduled to close on or about December 22, 2009. Closing
of the Offering is subject to certain conditions including, but not limited
to, the sale of a minimum of 83,333,333 Common Shares under the Offering and
receipt of all necessary approvals, including the approval of the Toronto
Stock Exchange.

The Company plans to use the net proceeds of the Offering to fund its
engineering, research, development and related costs, selling and marketing
expenditures, general and administration expenditures, as well as general
working capital requirements.

This news release does not constitute an offer to sell or a solicitation
of an offer to buy any of the securities of Azure in the United States. The
securities have not been and will not be registered under the United States
Securities Act of 1933, as amended or any state securities laws and may not
be offered or sold within the United States or to U.S. persons unless
registered under the U.S. Securities Act and applicable state securities laws
or unless an exemption from such registration is available.

About Azure Dynamics

Azure Dynamics Corporation (TSX: AZD) is a world leader in the
development and production of hybrid electric and electric components and
powertrain systems for commercial vehicles. Azure is strategically targeting
the commercial delivery vehicle and shuttle bus markets and is currently
working internationally with various partners and customers. The Company is
committed to providing customers and partners with innovative, cost-
efficient,and environmentally friendly energy management solutions.

For more information, please visit www.azuredynamics.com.

The TSX does not accept responsibility for the adequacy or accuracy of
this release.

Forward-looking Statements

This press release contains forward-looking statements. More
particularly, this press release contains statements concerning the
anticipated closing date of the Offering, the anticipated use of the net
proceeds from the Offering, Azure's business development strategy, projected
commercial revenues and product deliveries.

The forward-looking statements are based on certain key expectations and
assumptions made by Azure, including the anticipated sale of a minimum of
83,333,333 Common Shares under the Offering and the receipt of all necessary
approvals, as well as expectations and assumptions concerning achievement of
current timetables for development programs, target market acceptance of
Azure's products, current and new product performance, availability and cost
of labour and expertise, and evolving markets for power for transportation
vehicles. Although Azure believes that the expectations and assumptions on
which the forward-looking statements are based are reasonable, undue reliance
should not be placed on the forward-looking statements because Azure can give
no assurance that they will prove to be correct. The closing of the Offering
could be delayed or the Offering may not close at all if the necessary
approvals are not obtained on a timely basis or if the minimum of 83,333,333
Common Shares is not sold or if some other condition to completion of the
Offering is not satisfied. Since forward-looking statements address future
events and conditions, by their very nature they involve inherent risks and
uncertainties. Actual results could differ materially from those currently
anticipated due to a number of factors and risks. These include, but are not
limited to, the risks associated with Azure's early stage of development,
lack of product revenues and history of losses, requirements for additional
financing, uncertainty as to commercial viability, uncertainty as to product
development and commercialization milestones being met, uncertainty as to the
market for Azure's products and unproven acceptance of Azure's technology,
competition for capital, product market and personnel, uncertainty as to
target markets, dependence upon third parties, changes in environmental laws
or policies, uncertainty as to patent and proprietary rights, availability of
management and key personnel, and acquisition integration risk. These risks
are set out in more detail in Azure's annual information form which can be
accessed at www.sedar.com.

The forward-looking statements contained in this press release are made
as of the date hereof and Azure undertakes no obligation to update publicly
or revise any forward-looking statements or information, whether as a result
of new information, future events or otherwise, unless so required by
applicable securities laws.

For further information: Ryan Carr, Chief Financial Officer,
+1(248)298-2403ext 1206, Email: rcarr@azuredynamics.com; Pat Liebler,
Liebler Group, +1(313)832-4376, Email: pat@lieblergroup.com

For further information: Ryan Carr, Chief Financial Officer, +1(248)298-2403ext 1206, Email: rcarr at azuredynamics.com; Pat Liebler, Liebler Group, +1(313)832-4376, Email: pat at lieblergroup.com