SETTLEMENT AGREEMENT
 
This Settlement Agreement (the “Agreement”) is made and entered into as of
September 19, 2005 (the “Effective Date”), by and between Alliance
Pharmaceutical Corp. (the “Alliance”) and Imcor Pharmaceutical Co. (formerly
Photogen Technologies, Inc.) (“Imcor”). Alliance and Imcor may be referred to
herein individually as a “Party” and together as the “Parties.”
 
 
RECITALS
 
A.  On June 10, 2003, Alliance and Imcor entered into an Asset Purchase
Agreement pursuant to which, among other things, Alliance assigned and sold to
Imcor certain assets related to Alliance’s imaging and diagnostic imaging
business (the “Imagent Assets”), and Imcor assumed certain liabilities related
to such Imagent Assets (the “Asset Purchase Agreement”). Capitalized terms not
otherwise defined herein shall have the meanings ascribed to them under the
Asset Purchase Agreement.
 
B.  Alliance and Imcor are co-plaintiffs in that certain litigation referred to
as Imcor Pharmaceutical Co. and Alliance Pharmaceutical Corp. v. Amersham Health
Inc. (“Amersham”), Civil Action No. 03 CV 2853 currently pending in the United
States District Court for the District of New Jersey (the “Amersham
Litigation”).
 
C.  Certain disputes have now arisen between the Parties as to their respective
rights and obligations under the Asset Purchase Agreement and with respect to
the Amersham Litigation.
 
D.  The Board of Directors of Alliance and the Board of Directors of Imcor have
each determined that it is in the best interests of their respective
stockholders and creditors to settle the dispute in accordance with the terms
and conditions set forth in this Agreement.
 
E.  In entering into this Agreement, neither Party concedes the sufficiency or
validity of any claims, counterclaims, or defenses that have been asserted or
could be asserted by either of them.
 
 
AGREEMENT
 
In consideration of the foregoing recitals (which are incorporated herein by
this reference) and the covenants and conditions set forth below, the Parties
hereby agree as follows.
 
1.  Settlement. The Parties intend for this Agreement and the related
transactions to constitute a full and final resolution and settlement of the
disputes that have arisen between Alliance and Imcor arising from, or otherwise
related to, the Asset Purchase Agreement and/or the Amersham Litigation.
Further, this Agreement is being entered into for settlement purposes pursuant
to California Evidence Code §1152, Federal Rule of Evidence 408 and any similar
statute or rule in any applicable jurisdiction.
 

--------------------------------------------------------------------------------

2.  Termination of Continuing Obligations Under the Asset Purchase Agreement. As
of the Effective Date and subject to the terms of this Agreement, the Parties
hereby agree that the continuing rights and obligations of each Party under the
Asset Purchase Agreement are hereby terminated and shall be of no further force
or effect. Such continuing rights and obligations include, but are not limited
to, Section 1.2(g) (Equity Conversion), Section 1.3 (Earnout), including,
without limitation, Alliance’s release of any and all rights and obligations set
forth in subsection (g) thereof pursuant to which Imcor shall re-license to
Alliance the Imagent Assets in the event Imcor’s Board of Directors determines
that it is not in Imcor’s best interests to allocate its efforts and resources
towards the promotion of the Imagent Assets and the Imagent Products (the
“Alliance Imagent License Rights”), Article VII (Survival of Representations and
Warranties; Indemnification) and any royalty rights either Party may be entitled
to under the Asset Purchase Agreement (collectively, the “Continuing
Obligations”).
 
3.  Economic Arrangements.
 
3.1  Amersham Litigation. With respect to the Amersham Litigation, the Parties
agree to enter into a settlement agreement with Amersham upon substantially the
same terms most recently proposed by Amersham, including, without limitation, a
cash payment of $1,200,000. The Amersham settlement agreement shall specify that
Amersham will pay $1,000,000 of such amount directly to Imcor in satisfaction of
Imcor’s claims in the Amersham Litigation and that Amersham will pay $200,000
directly to Alliance in satisfaction of any and all of Alliance’s claims in the
Amersham Litigation under the Asset Purchase Agreement.
 
3.2  Sale of Imagent Assets.
 
(a)  Imcor shall use commercially reasonable efforts to promptly seek to sell,
license, enter into a joint venture relationship or enter into another strategic
transaction involving the disposition of the remainder of the Imagent Assets to
a third-party in its sole discretion and subject to shareholder and other
required approvals (an “Imagent Transaction”), but will confer with Alliance
with respect to the terms and targets for potential joint venture, license or
other strategic relationships, as well as the method of offering the Imagent
Assets for sale and potential buyers. The reasonable third-party fees and
expenses directly related to an Imagent Transaction shall be shared between the
Parties in proportion to the amounts received by each Party as a result of such
Imagent Transaction as set forth in subsection (b) below. The definitive
agreement entered into with any third-party relating to an Imagent Transaction
shall provide that any and all proceeds that Alliance is entitled to from the
Imagent Transaction as provided for in subsection (b) below shall be remitted by
the buyer thereof directly to Alliance. The Parties hereby acknowledge and agree
that Alliance’s right to receive payments directly from the buyer in an Imagent
Transaction pursuant to this Section 3.2, and any payments made directly to
Alliance by any such buyer are solely the right and property of Alliance. Imcor
shall have no interest whatsoever in payments made (or to be made) directly to
Alliance nor in Alliance’s right to receive such payments. In the event a buyer
erroneously delivers to Imcor any funds belonging to Alliance, Imcor shall hold
such funds in a segregated bank account in trust solely for the benefit of
Alliance which it shall forthwith deliver to Alliance. If Imcor files a
voluntary bankruptcy petition, or has an involuntary bankruptcy petition filed
against it, or becomes subject to an assignment for the benefit of creditors,
creditors’ trust, or related proceeding, Alliance’s right to receive payments
from any Imagent Transaction buyer, or any such funds held in trust by Imcor,
shall not become property of Imcor or Imcor’s bankruptcy estate as the right of
Alliance to receive payments herewith is its sole and separate right, is not a
right of Imcor, and is not property of Imcor’s bankruptcy estate within the
meaning of 11 U.S.C. 541(a), and Alliance’s right to recover such payments shall
not be subject to the automatic stay imposed under 11 U.S.C. § 362 in any
bankruptcy case filed by or against Imcor. Should a bankruptcy petition be filed
by or against Imcor, or should Imcor become subject to an assignment for the
benefit of creditors, creditors’ trust, or similar proceeding, Alliance will
continue to have its independent right to pursue, recover and receive any
payments directly from a buyer due it under this Section 3.2 since, and any
funds held in trust by Imcor for the benefit of Alliance, it being acknowledged
that Imcor has no property interest, or any interest whatsoever, in payments to
be made directly to Alliance (or held in trust by Imcor for the benefit of
Alliance), and such payments and funds shall not become property of Imcor’s
bankruptcy estate.
 
2

--------------------------------------------------------------------------------

(b)  The proceeds from an Imagent Transaction shall be allocated between the
Parties as follows:
 
(i)  The first $1,450,000 in proceeds from an Imagent Transaction shall be
divided on a dollar-for-dollar basis as follows: ninety percent (90%) to Imcor
and ten percent (10%) to Alliance until such time as Alliance has been paid
$100,000;
 
(ii)  The proceeds from an Imagent Transaction from $1,450,001 to $5,000,000
shall be divided on a dollar-for-dollar basis as follows: seventy percent (70%)
to Imcor and thirty percent (30%) to Alliance; and
 
(iii)  The proceeds from an Imagent Transaction above $5,000,000 shall be
divided on a dollar-for-dollar basis as follows: sixty-six and seven-tenths of a
percent (66.7%) to Imcor and thirty-three and three-tenths of a percent (33.3%)
to Alliance.
 
3.3  Schering and Transaction Liability. To the extent that an Imagent
Transaction results in any liability to Schering Aktiengesellschaft (“Schering”)
under the terms of that certain License Agreement originally dated as of
September 23, 1997, as amended and restated as of February 22, 2002, by and
between Alliance and Schering, as assigned to and assumed by Imcor, or any
transaction fees and expenses, such amount payable by each Party shall be
determined based upon the ratios set forth as follows:
 
(i)  Any liability to Schering or for transaction fees or expenses related to
the first $1,450,000 in proceeds from an Imagent Transaction shall be divided on
a dollar-for-dollar basis and promptly paid as follows: ninety percent (90%) by
Imcor and ten percent (10%) by Alliance until such time as Alliance has paid
$100,000;
 
(ii)  Any liability to Schering or for transaction fees or expenses related to
an Imagent Transaction with proceeds from $1,450,001 to $5,000,000 shall be
divided on a dollar-for-dollar basis and paid as follows: seventy percent (70%)
by Imcor and thirty percent (30%) by Alliance; and
 
(iii)  Any liability to Schering or for transaction fees or expenses related to
an Imagent Transaction with proceeds above $5,000,000 shall be divided on a
dollar-for-dollar basis and paid as follows: sixty-six and seven-tenths of a
percent (66.7%) by Imcor and thirty-three and three-tenths of a percent (33.3%)
by Alliance.
 
3

--------------------------------------------------------------------------------

4.  Imcor Release. Except as expressly set forth in this Agreement for and in
consideration of the mutual covenants set forth herein, which are hereby
excluded from and survive this general release, Imcor, on its own behalf and on
behalf of its grantees, agents, representatives, assignees, assignors, attorneys
or any other entity in which Imcor has a controlling interest (collectively, the
“Imcor Releasors”), hereby releases and forever discharges by this Agreement
Alliance, and each of its past and present agents, employees, representatives,
officers, directors, stockholders, attorneys, accountants, insurers, receivers,
advisors, consultants, partners, partnerships, parents, divisions, subsidiaries,
affiliates, assigns, successors, heirs, predecessors in interest, joint
ventures, and commonly-controlled corporations (collectively, the “Alliance
Releasees”) from and against any and all liabilities, causes of action, charges,
complaints, suits, claims, obligations, costs, losses, damages, rights,
judgments, attorneys’ fees, expenses, bonds, bills, penalties, fines, and all
other legal responsibilities of any form whatsoever, whether known or unknown,
whether suspected or unsuspected, whether fixed or contingent, liquidated or
unliquidated, including, but not limited to, those arising from or otherwise
related to: (i) the Asset Purchase Agreement or any document related thereto and
any of the Continuing Obligations of the Parties thereunder, (ii) the Amersham
Litigation, (iii) any act or omission occurring prior to the Effective Date by
any Alliance Releasee, (iv) the use and occupancy of the premises located at
6175 Lusk Boulevard, San Diego, CA 92121 (the “Premises”), and (v) the use of
the other Party’s personnel, including in each case those arising under any
theory of law, whether common, constitutional, statutory or other or of any
jurisdiction, foreign or domestic, whether known or unknown, whether in law or
in equity, which any Imcor Releasor had or may claim to have against any of them
(collectively referred to as the “Imcor Released Claims”); provided, however,
that the foregoing shall not release or impair any claims to enforce the
provisions of this Agreement.
 
5.  Alliance Release. Except as expressly set forth in this Agreement, for and
in consideration of the mutual covenants set forth herein, which are hereby
excluded from and survive this general release, Alliance on its own behalf, and
on behalf of its grantees, agents, representatives, assignees, assignors,
attorneys or any other entity in which the Alliance has a controlling interest
(collectively, the “Alliance Releasors”) hereby releases and forever discharges
by this Agreement Imcor, and each of its past and present agents, employees,
representatives, officers, directors, stockholders, attorneys, accountants,
insurers, receivers, advisors, consultants, partners, partnerships, parents,
divisions, subsidiaries, affiliates, assigns, successors, heirs, predecessors in
interest, joint ventures, and commonly-controlled corporations (collectively,
the “Imcor Releasees”) from and against any and all liabilities, causes of
action, charges, complaints, suits, claims, obligations, costs, losses, damages,
rights, judgments, attorneys’ fees, expenses, bonds, bills, penalties, fines,
and all other legal responsibilities of any form whatsoever, whether known or
unknown, whether suspected or unsuspected, whether fixed or contingent,
liquidated or unliquidated, including, but not limited to, those arising from or
otherwise related to: (i) the Asset Purchase Agreement or any document related
thereto and any of the Continuing Obligations of the Parties thereunder, (ii)
the Amersham Litigation, (iii) any act or omission occurring prior to the
Effective Date by any Imcor Releasee, (iv) the use and occupancy of the
Premises, and (v) the use of the other Party’s personnel, including in each
case, those arising under any theory of law, whether common, constitutional,
statutory or other or of any jurisdiction, foreign or domestic, whether known or
unknown, whether in law or in equity, which any Alliance Releasor had or may
claim to have against any of them (collectively referred to as the “Alliance
Released Claims”); provided, however, that the foregoing shall not release or
impair any claims to enforce the provisions of this Agreement.
 
4

--------------------------------------------------------------------------------

6.  Adequate Consideration. The Parties hereby acknowledge and agree that this
Agreement and the covenants provided hereunder constitute full, fair and
adequate consideration and compensation for the releases granted in Sections 4
and 5, above. Each party agrees that the fair value of the consideration it is
receiving under this Agreement equals or exceeds the fair value of the
consideration it is delivering.
 
7.  Unknown Claims. Each Party acknowledges that it may hereafter discover facts
different from, or in addition to, those which said Party now believes to be
true with respect to the release of claims. Each Party agrees that the foregoing
release shall be and remain effective in all respects notwithstanding such
different or additional facts or discovery thereof, and that this Agreement
contemplates the extinguishment of all such claims and causes of action.
 
8.  Covenant Not to Sue. Each of the Parties, for itself and for its heirs,
successors, agents, assigns and affiliates and any person or entity claiming by,
through or under it, further agrees, promises, and covenants that they have not,
will not, nor will any person, organization or any other entity acting on their
behalf, file, charge, claim, sue, participate in, join or cause or permit to be
filed, charged or claimed, any action for damages or other relief (including
injunctive, declaratory, monetary or other) against the other Parties released
hereunder, their affiliates and successors and their respective officers,
directors, employees, agents, and representatives, past and present, with
respect to any Imcor Released Claims or Alliance Released Claims, as the case
may be.
 
9.  Civil Code Section 1542 Waiver. With respect to the Imcor Released Claims
and the Alliance Released Claims, as the case may be, it is further understood
and agreed that notwithstanding California Civil Code Section 1542, which
presently provides:
 
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR,”
 
the release by each Party contained herein extends to all claims of every nature
and kind whatsoever, known and unknown.
 
Each Party hereby waives any and all rights that it may have under Section 1542
as it presently reads or as it shall hereinafter be amended. In connection with
this waiver, each Party acknowledges that it is aware that it may hereafter
discover claims presently unknown or unsuspected or facts in addition to or
different from those it now knows or believes to be true with respect to the
Imcor Released Claims or Alliance Released Claims, as the case may be.
Nevertheless, it intends through this Agreement to release fully, finally, and
forever, in the manner described herein, all Imcor Released Claims or Alliance
Released Claims, as the case may be. Accordingly, the releases contained herein
shall remain in effect as a full and complete release of the Imcor Released
Claims or Alliance Released Claims, as the case may be, in accordance with its
terms notwithstanding the discovery or existence of any such additional facts or
different claims relating thereto.
 
5

--------------------------------------------------------------------------------

10.  No Admission of Liability. This Agreement is intended to and does
compromise disputed claims and shall not be construed as an admission of
liability by any Party of any claim made by the other Party.
 
11.  Independent Investigation; Voluntary Agreement. Each Party has made such
investigation of the facts pertaining to this Agreement, and of all other
matters pertaining thereto, as the Party deems necessary.
 
12.  Non-Disparagement. The Parties acknowledge that their professional
reputations are extremely important in the community at large. As such, neither
Party nor its officers at the vice president level or higher will take any
actions or make any statements that are disparaging of the other Party
(including its current directors, officers, employees, consultants or any
parent, subsidiary or successor-in-interest of a Party). Furthermore, the
Parties agree that they will not make or publish any statement, written or oral,
that becomes or reasonably could be expected to become publicly known, or
instigate, assist or participate in the making or publication of any such
statement, which would libel or slander the other Party or its current officers,
directors, employees, consultants or any parent, subsidiary or
successor-in-interest of a Party. The Parties hereby acknowledge and agree that
this non-disparagement clause is a material term of this Agreement.
 
13.  Attorney’s Fees. In the event that either Party brings an action,
arbitration or proceeding to enforce, interpret or construe this Agreement
(including an alleged violation of the confidentiality provisions of this
Agreement), the prevailing Party in such action, arbitration or proceeding shall
be entitled to recover its reasonable attorneys’ fees and costs from the other
Party.
 
 
14.  Representations and Warranties. The Parties to this Agreement, and each of
them, represent and warrant that:
 
14.1  Each Party has received independent legal advice from its attorneys with
respect to the advisability of making the settlement provided for in this
Agreement.
 
14.2  Each Party declares that prior to the execution of this Agreement, they
apprised themselves of sufficient relevant information, through sources of their
own selection, in order that they might intelligently exercise their own
judgment in deciding whether to execute it, and in deciding on the contents
hereof.
 
14.3  No Party (nor any officer, agent, partner, employee, representative, or
attorney for any Party), has made any statement or representation to any other
Party regarding any fact relied upon in entering into this Agreement, except as
set forth herein, and each Party does not rely upon any statement,
representation or promise of any other Party (or any officer, agent, partner,
employee, representative, or attorney of or for any Party), in executing this
Agreement, or in making the settlement provided for herein, except as set forth
herein.
 
6

--------------------------------------------------------------------------------

14.4  Each Party to this Agreement has made such independent investigation of
the facts pertaining to this Agreement, and of all matters pertaining to it, as
it deems necessary.
 
14.5  Each Party, or its responsible officers, has read this Agreement and
understands the contents hereof, and any individual executing this Agreement is
legally competent to execute this Agreement, and any person executing this
Agreement in a representative capacity of any of the Parties is authorized and
empowered to do so and thereby has the authority to bind the Party on whose
behalf this Agreement is signed.
 
14.6  The Parties will execute all such further and additional documents as
shall be reasonably necessary to carry out the provisions of this Agreement.
 
14.7  Each Party represents and warrants that this Agreement and the
transactions contemplated herein (i) are not made or incurred with the intent to
hinder, delay or defraud any person to whom such Party has been, is now, or may
hereafter become indebted; and (ii) are not entered into with the intent to
incur, or with the belief that such Party would incur, debts beyond its ability
to pay as such debts mature.
 
15.  No Prior Assignment of Rights. Each Party is the sole owner of the Imcor
Released Claims and Alliance Released Claims, respectively, being released by it
hereby and such Party has not assigned or otherwise transferred, voluntarily or
involuntarily, any such Imcor Released Claims or Alliance Released Claims, as
the case may be.
 
16.  Assertion of Agreement as Bar to Proceedings. This Agreement may be
asserted by any of the Imcor Releasees or Alliance Releasees, as the case may
be, as a defense and complete bar to any action, claim, cross claim, cause of
action, arbitration or other proceeding that may be brought, or could have been
brought, instituted or taken by, against, or involving any of the Imcor
Releasors, Alliance Releasors, or anyone acting or purporting to act on behalf
of any of the same with respect to any Imcor Released Claims or Alliance
Released Claims, as the case may be.
 
17.  Entire Agreement. This Agreement contains the entire understanding of the
Parties with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements, understandings, discussions and representations,
oral or written, with respect to such matters, which the Parties acknowledge
have been merged into such documents, exhibits and schedules.
 
18.  Notices. Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earliest of (a) the date of transmission, if such
notice or communication is delivered via facsimile (provided the sender receives
a machine-generated confirmation of successful transmission) at the facsimile
number specified in this Section prior to 6:30 p.m. (New York City time) on a
business day, (b) the next business day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in this section on a day that is not a business day or later than 6:30
p.m. (New York City time) on any business day, (c) the business day following
the date of mailing, if sent by U.S. nationally recognized overnight courier
service, or (d) upon actual receipt by the Party to whom such notice is required
to be given. The address for such notices and communications shall be as
follows:
 
7

--------------------------------------------------------------------------------

                                                If to the Alliance: Alliance
Pharmaceutical Corp.
4660 La Jolla Village Drive, Suite 825
San Diego, California 92122
Facsimile No.: (858) 410-5343
Telephone No.: (858) 410-5200
Attention: Duane Roth, Chief Executive Officer
 
                                                 With a copy to:    Foley &
Lardner LLP
402 W. Broadway, 23rd Floor
San Diego, CA 92101
Facsimile No.: (619) 234-3510
Telephone No.: (619) 685-4615
Attention: Kenneth D. Polin, Esq.
 
                                                 If to Imcor:           Imcor
Pharmaceutical Co.
4660 La Jolla Village Drive, Suite 540
La Jolla, CA 92037
 
                                                 and to:                  Imcor
Pharmaceutical Co.
P.O. Box 2389
La Jolla, CA 92037
Facsimile: (858) 410-5601
Telephone No.: (858) 410-5602
Attention: B. Jack DeFranco
 
                                                  With a copy to:   Grippo &
Elden LLC
                                                                                
111 S. Wacker Drive
                                                                                
Chicago, IL 60606
                                                                                
Facsimile No.: (312) 558-1195
                                                                                
Telephone No.: (312)-704-7733
                                                                                
Attention: Matthew I. Hafter

or such other address as may be designated in writing hereafter, in the same
manner, by such Person.
 
19.  Amendments; Waivers. Except as expressly set forth herein, no provision of
this Agreement may be waived or amended as between the Parties hereto except in
a written instrument signed by the Parties. No waiver of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of either Party to exercise any right hereunder in
any manner impair the exercise of any such right.
 
8

--------------------------------------------------------------------------------

20.  Construction. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the Parties to express their mutual intent, and no
rules of strict construction will be applied against any Party. This Agreement
shall be construed as if drafted jointly by the Parties, and no presumption or
burden of proof shall arise favoring or disfavoring any Party by virtue of the
authorship of any provisions of this Agreement or any of the documents
contemplated hereby.
 
21.  Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the Parties and their successors and assigns.
 
22.  Governing Law; Dispute Resolution. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by and construed and enforced in accordance with the internal laws
of the State of New York, without regard to the principles of conflicts of law
thereof. In the event that a dispute arises between the Parties concerning this
Agreement or the transactions contemplated herein, each Party agrees to
designate an executive officer to negotiate within five business days after
receipt of written notice of the dispute. The notice shall specify in reasonable
detail the nature and circumstances of the dispute. Each Party’s representatives
shall confer concerning the dispute for a period of thirty (30) days, and
neither Party shall commence any legal action concerning the dispute until the
expiration of such period (other than equitable action seeking non-monetary
relief if necessary solely to preserve the status-quo).
 
23.  Execution. This Agreement may be executed in two or more counterparts, all
of which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each Party and
delivered to the other Party, it being understood that both Parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the Party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile signature page
were an original thereof.
 
24.  Severability. If any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the Parties will attempt to agree upon a valid,
legal and enforceable provision that is a reasonable substitute therefore, and
upon so agreeing, shall incorporate such substitute provision in this Agreement.
 
25.  Arm’s Length Negotiations. This Agreement is being entered into in good
faith by the Parties and was negotiated through arm’s length bargaining.
 
26.  Public Announcements. The Parties shall consult with each other prior to
issuing any press releases, filing any Current Reports on Form 8-K or otherwise
making any public statements with respect to this Agreement and the transactions
contemplated hereby. Neither party shall issue any such press release, file such
8-K or make any other public statement without the agreement of the other Party,
such agreement not to be unreasonably withheld; provided, however, in no event
shall a Party be prevented from issuing a press release, filing an 8-K or making
any other public statement that such has been advised by counsel may be required
by law.
 
9

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the Parties have executed this Settlement Agreement as of
the Effective Date.
 

        ALLIANCE PHARMACEUTICAL CORP.  
   
   
    By:   /s/ Duane Roth  

--------------------------------------------------------------------------------

Duane Roth, Chief Executive Officer    

 

        IMCOR PHARMACEUTICAL CO.  
   
   
    By:   /s/ Brian Gallagher  

--------------------------------------------------------------------------------

Brian Gallagher, Chairman of the Board of Directors    

 
[Signature Page to Settlement Agreement]

10

--------------------------------------------------------------------------------