Alexza Pharma (ALXA) Exercises Option to Purchase All Equity of Symphony Allegro

Alexza Pharmaceuticals, Inc. (Nasdaq: ALXA) announced today that it has exercised its option to purchase all of the equity of Symphony Allegro. The purchase of Symphony Allegro, which is subject to Alexza stockholder approval, is projected to close in Q3 2009.

Alexza and Symphony Capital Partners, LP have negotiated new terms to satisfy the exercise price for Alexza's option exercise to acquire Symphony Allegro. Under the terms of the Amended and Restated Purchase Option Agreement, Alexza will:

• issue Symphony Capital 10 million shares of Alexza Common Stock
  
• issue Symphony Capital a five-year warrant for 5 million shares of Alexza Common Stock at an exercise price of $2.26 per share, a 25% premium to the preceding 30-trading day average closing price, and cancel Symphony's currently outstanding 2 million shares warrant for Alexza Common Stock
  
• pay Symphony certain percentages of cash payments that may be generated from future partnering transactions for AZ-004, AZ-104 and/or AZ-002, the product candidates that were licensed to Symphony Allegro

Upon closing of the transaction, Symphony Capital will own approximately 23% of the total Alexza Common Stock outstanding. Symphony Capital will have the right to nominate one director to the Alexza Board of Directors, as long as its ownership exceeds more than 10% of the total outstanding Common Stock.

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