Convertible Loan Note Offer

Azure Holdings PLC
18 July 2006

                               Azure Holdings plc


                                (the 'Company')


                          Convertible Loan Note Offer



The Company announces that it has today issued a letter to holders of ordinary
shares of 1p each in the Company ('Ordinary Shares'), on the share register of
the Company on 17 July 2006, offering them the opportunity to participate in the
subscription of up to £1,200,000 nominal unsecured convertible loan stock 2008
('Loan Stock').



The Loan Stock is being offered following discussions regarding a proposed
acquisition by the Company ('Acquisition'). The proposed target for the
Acquisition is ValiRX Limited ('ValiRX'), a biopharmaceutical development
company. Discussions with ValiRX are progressing and the directors of the
Company hope to complete a reverse takeover under the AIM rules before 30
September 2006.



The principal terms of the Loan Stock are as follows:



1                    Unless previously converted or repaid, the Loan Stock is
repayable 24 months from the date of the Loan Stock instrument under which it is
created (the 'Instrument') or at any time after 31 October 2006 at the Company's
option.



2                    In partial consideration for the Loan Stock holders
subscribing for Loan Stock, a premium ('Premium') of £2 for each £1 nominal of
Loan Stock is payable, unless previously converted or paid, 24 months from the
date of the Instrument, or at any time after 31 October 2006 at the Company's
option.



3                    Interest is payable from 1 November 2006 on the amount of
the Loan Stock at the rate of two per cent. over the base rate of the Bank of
Scotland plc from time to time.  Interest is payable twice yearly.  The first
interest period will run from 1 November 2006 to 31 March 2007.



4                    The conversion of Loan Stock ('Conversion') into Ordinary
Shares is conditional upon approval by shareholders of resolutions to allot
shares and disapply pre-emption rights; and if appropriate, the approval by a
vote of independent shareholders taken on a poll of any waiver granted by the
Panel on Takeovers and Mergers of any obligation under rule 9 of the City Code
on Takeovers and Mergers which may arise from such Conversion (together the '
Conversion Event')



5                    Immediately prior to the Conversion Event, the Loan Stock
is deemed repayable and the Premium is deemed payable.



6                    On the Conversion Event, the Loan Stock and the Premium
which has not been repaid or paid as the case may be, will be converted into
Ordinary Shares in the capital of the Company at the rate of 100 Ordinary Shares
of the Company for each £1 otherwise due for repayment or payment.



7                    So far as it is lawfully able to do so, the Company will
notify the Loan Stock holders at least 10 days in advance of the likely
occurrence of the Conversion Event.



8                    The Loan Stock is transferable in multiples of £10,000.



9                    The Company is obliged to repay the Loan Stock and pay the
Premium on the occurrence of certain events, including certain insolvency
events.



10         Decisions relating to the Loan Stock are to be taken by a written
resolution of the holders of at least two thirds in nominal value of the
outstanding Loan Stock.



Applications for the Loan Stock may only be made for a minimum of £1,000 nominal
and in multiples of £1,000. Applications for the Loan Stock are to be received
by the Company at One Great Cumberland Place, London W1H 7AL by 3.00pm on 31
July 2006.



A copy of the letter despatched to shareholders and the Instrument are available
for inspection, on request, at Halliwells LLP, 1 Threadneedle Street, London
EC2R 8AW during normal business hours on any weekdays, Saturdays, Sundays and
public holidays excluded, for one month from today.



For further information, please contact:



Barry Gold, Azure Holdings plc
Tel: [phone]

David Youngman, WH Ireland Limited                       Tel:  [phone]


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