AirIQ Inc. Market Update

TORONTO, ONTARIO--(MARKET WIRE)--Jan 5, 2009 -- AirIQ Inc. (Toronto:IQ.TO - News), a leader in Wireless Location-Based Services, specializing in Telematics and Security, today announced receipt of a non-binding Letter of Intent ("LOI") that would provide funding to the Company to be used to protect its competitive positions in core markets and to drive scale in new services launched earlier this year. The new investors have requested a role in management as well as representation on the Board of Directors. AirIQ's Board of Directors has accepted the proposal. The Company is now proceeding with the customary due diligence process, and has commenced negotiations and preparation of definitive documentation.

The LOI is non-binding on the investors as well as AirIQ, and as a result there can be no assurance that the transaction will move forward or that AirIQ will receive any funding. The transaction contemplated by the LOI is also subject to approval of the Toronto Stock Exchange.

"Over the past year AirIQ's management re-focused its marketing efforts, improved productivity, and substantially reduced fixed expenses through staff re-assignment and role consolidation. As a consequence, AirIQ has delivered four consecutive quarters of reduced expenses. Over this same period the Company has continued to fight certain legacy claims relating to past sales. We believe that our goal of realizing positive operating profits for both the marine and land businesses is now feasible. Furthermore, the overall reduction of annual expenses puts in reach our greater objective of positive EBITDA", said Steve Willey, President and Chief Executive Officer of AirIQ.

"We are now in a position where we can assess specific and new strategies for 2009. While we face the business challenge of weakness in certain sectors that results from operating in a difficult economy, this financing would allow us to defend our core franchises, and at the same time support recent product launches. It is worth restating, however, that we still believe that the building of business scale in this telematics sector is essential to delivering new shareholder value, and that we will therefore continue to evaluate business consolidation opportunities", added Mr. Willey.

AirIQ provided further information concerning its 2008 results, as follows:

- Over seventy percent of AirIQ's revenue is of a recurring nature, limiting the Company's dependence on new sales;

- AirIQ's recurring revenue generates attractive gross profit as a result of reduced operating costs;

- AirIQ's cash position (which it had earlier indicated would be at least sufficient to support 2008 operations) stands at approximately $2.5M as of December 2008.

As a final note, AirIQ management and staff would like to thank the Company's customers, suppliers, and shareholders for their patience and support during what was an eventful but gratifying year of change and considerable progress.

Non-GAAP Disclosure

"EBITDA" is defined by the Company as net income before interest expense, income taxes, other charges, depreciation and amortization. The Company has included information concerning EBITDA because it believes that it may be used by certain investors as one measure of the Company's financial performance. EBITDA is not a measure of financial performance under Canadian GAAP and is not necessarily comparable to similarly titled measures used by other companies. EBITDA should not be construed as an alternative to net income or to cash flows from operating activities (as determined in accordance with Canadian GAAP) or as a measure of liquidity. In addition, the Company has included information concerning adjustments to gross profit, expenses and working capital because it believes that it may be used by certain investors as further measures of the Company's financial performance, and such adjustments to expenses or assets and liabilities are highlighted due to their nature or to their magnitude.

About AirIQ

AirIQ trades on the Toronto Stock Exchange under the symbol IQ. A leader in Wireless Location Services, specializing in Telematics and Security, AirIQ has offices in Pickering, Ontario, Canada, and in San Diego, California, United States. The Company offers a suite of location based services (LBS) under a 'software as a service' (SaaS) model that results in recurring revenues for each device deployed. AirIQ offers service to three primary markets: Commercial Fleets; dealers that service Consumer segments; and Marine Fleets (fisheries and workboat). AirIQ gives vehicle and vessel owners the ability to monitor, manage and protect their mobile assets. Services include: instant vehicle locating, boundary notification, automated inventory reports, maintenance reminders, security alerts, vehicle disabling and unauthorized movement alerts. For additional information on AirIQ or its products and services, please visit the Company's website at www.airiq.com.

Forward-looking Statements

This news release contains forward-looking information based on management's best estimates and the current operating environment. These forward-looking statements are related to, but not limited to, AirIQ's operations, anticipated financial performance, business prospects and strategies. Forward-looking information typically contains words such as "goal", "anticipate", "believe", "expect", "plan" or similar words suggesting future outcomes. These statements are based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking statements, including AirIQ's perception of historical trends, current conditions and expected future developments as well as other factors management believes are appropriate in the circumstances. Such forward-looking statements are as of the date which such statement is made and are subject to a number of known and unknown risks, uncertainties and other factors which could cause actual results or events to differ materially from future results expressed, anticipated or implied by such forward-looking statements. Such factors include, but are not limited to, changes in market and competition, technological and competitive developments and potential downturns in economic conditions generally. Therefore, actual outcomes and results may differ materially from those expressed in such forward-looking statements. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes. Other than as may be required by law, AirIQ disclaims any intention or obligation to update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise.

     Contacts:
     AirIQ Inc.
     Steve Willey
     Chief Executive Officer
     (416) 275-6994
     Email: swilley@airiq.com
     Website: http://www.airiq.com