April 19, 2012,

To Our Valued Friends, Re: Progress Relative to the Companies' Creditors Arrangement Act and Restructuring

As you know, on March 26, 2012 Azure Dynamic Corporation and its operating subsidiaries (collectively the "AZD") filed for and obtained protection from its creditors under the Companies' Creditors Arrangement Act (Canada) ("CCAA"). The Supreme Court of British Columbia (the "CDA Court") granted the initial order ("Initial Order"). Pursuant to the Initial Order Ernst & Young Inc. was appointed Monitor of AZD during the CCAA proceedings. In its capacity as foreign representative of AZD, the Monitor sought relief from the US Bankruptcy court pursuant to Chapter 15. The US Bankruptcy court granted a temporary restraining order on March 27, 2012 and a preliminary injunction order on April 9,
2012 pending a full recognition hearing on May 3, 2012. The CCAA and Chapter 15 proceedings provide
AZD the opportunity to restructure its business and financial affairs.
While this process initially created some uncertainty in the marketplace it does not mean that Azure is bankrupt or that it will cease operations. In fact, the CCAA filing has allowed Azure's management team to implement significant restructuring measures and seek out debtor-in-possession ("DIP") financing.
We are pleased to report that on April 13, 2012 the CDA Court granted an order approving a DIP financing facility which will provide AZD up to $4,000,000 in funding during these proceedings to support the company's mission to 'drive a world of difference' and move forward.
The management team is focused on making a successful turnaround that will see AZD emerge still passionately dedicated to delivering sustainable commercial transportation solutions to a wide variety of fleets in North America and Europe. To this end, the purpose of this letter is to bring our dealership network, end users, and all interested constituents up to speed on recent developments critical to the return to normal business.

WARRANTY

We have been able to re-establish our vehicle warranty effective immediately. As a result of capital
constraints and the restructuring process we temporarily suspended warranty coverage in order to get the company back into a position that would allow it to handle claims. We're pleased to report that we have now been able to achieve this important milestone. AZD will now cover all warranty claims on vehicles where work was performed from March 27th forward. The warranty claims will be honoured on all AZD products in North America and Europe. We ask that you exercise patience as we may experience some initial delays while a leaner group at AZD oversees warranty claims and also as we deal with new requirements on processing payments, but we thought that reinstating this coverage would be an important sign to you of our determination to keep our customers first.

Please note; any outstanding warranty claims where repairs were performed prior to March 26th will remain part of the CCAA and will be dealt with as part of the proceedings. TECHNICAL SUPPORT

The entire AZDtec™ website structure will continue to provide technical information, reference
materials, online store for software downloads and online training for AZD products.
We will be providing technical support directly from our Engineering and Technician staff who will continue to monitor the following support request systems:

• For Dealers and Fleets with login credentials - Dealer Support Solutions (DSS) Support

Request (Select Support, Dealer, and Dealer Support Solutions from AZDtec menu system).

• For all other technical support - Customer Care Center Support Request System (Select

Support, End-User or Fleet, "Report a Customer Concern" in Customer Care Center menu).

ALL REPLACEMENT PARTS should be requested via the online DSS system.

We are in regular communication with Ford Motor Company regarding the proceedings and it is our objective to be transparent with all interested parties whether partners, suppliers, end users or shareholders. We all have a vested interest in the Electric Vehicle space and Azure Dynamics.
We believe that our dedication and hard work over the last decade, which established AZD as a recognized market leader, will be rewarded as we work on this turnaround. Unfortunately, when a company goes through what AZD has gone through in the past few months, a lot of inaccurate stories and comments
often distort facts. We are the first to admit that this process has been very difficult for everyone involved but we want you to know that we are moving forward and if there is any doubt or questions or a need for additional information, please contact AZD directly. Our intentions are to be fully operational as soon as possible, leaner and stronger than ever.
We sincerely appreciate the kind words of support and encouragement we have received from so many respected businesses, organizations and individuals and we look forward to this same level of cooperation and support continuing as we complete our restructuring.
If you require further information on the formal proceedings, or wish to receive a copy of the Order or any other public notices, please go to www.ey.com/ca/azure.
Thank you for your cooperation and continued support of AZD. Sincerely,
Team AZD

FOR MORE INFORMATION, CONTACT:

Mike Elwood (416) 953-4134
Email: melwood@azuredynamics.com

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