Laxai Pharma reaches agreement with UTA to extend terms of existing secured promissory note

Jul 31 2010

Laxai Pharma Ltd. (the "Company") (OTCBB:LAXAF), an international pharmaceutical contract research organization ("CRO"), recently reached an agreement with UTA Capital LLC ("UTA") to extend the terms of an existing secured promissory note issued by the Company in favor of UTA on March 3, 2010 in the aggregate principal amount of $1.44 million ("Note").

Among other things, the parties agreed to extend the term of the Note through December 15, 2010, and to reduce the interest rate on the Note to 15% simple interest per annum. In consideration for these favorable modifications, the Company has agreed to grant to UTA an additional 5-year warrant, which generally would allow UTA to purchase up to 400,000 common shares in consideration for the extension and up to an additional 1,620,000 common shares pro- rated based on the average principal balance outstanding during the remaining term of the Note, all with an exercise price of $.05 per share.

"We are very pleased that UTA has shown such confidence in our business model and in the growth story of Laxai and has chosen to continue to support our efforts to build a fully integrated, international CRO for drug development," said Ram Ajjarapu, Executive Chairman of Laxai.