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                                   CREDIT AGREEMENT

      This Agreement is made by and between Alliance Pharmaceutical, Corp.
("Borrower") and Imperial Bank, a California banking corporation, ("Bank").

      In consideration of mutual covenants and conditions hereof, the parties
hereto agree as follows:

1.    REPRESENTATIONS OF BORROWER

          Borrower represents and warrants that:

1.01      EXISTENCE AND RIGHTS.  Borrower is a corporation duly organized and
existing and in good standing under the laws of New York, without limit as to
the duration of its existence and is authorized and in good standing to do
business in the State of California; Borrower has corporate powers and adequate
authority, rights and franchises to own its property and to carry on its
business as now conducted, and is duly qualified and in good standing in each
State in which the character of the properties owned by it therein or the
conduct of its business makes such qualification necessary; and Borrower has the
power and adequate authority to make and carry out this Agreement

1.02      AGREEMENT AUTHORIZED.  The execution, delivery and performance of this
Agreement are duly authorized and do not require the consent or approval of any
governmental body or other regulatory authority; are not in contravention of or
in conflict with any law or regulation or any term or provision of Borrower's
articles of incorporation, by-laws, as the case may be, and this Agreement is
the valid, binding and legally enforceable obligation of Borrower in accordance
with its terms; subject only to bankruptcy, insolvency or similar laws affecting
creditors rights generally.

1.03      NO CONFLICT.  The execution, delivery and performance of this
Agreement are not in contravention of or in conflict with any agreement,
indenture or undertaking to which Borrower is a party or by which it or any of
its property may be bound or affected, and do not cause any lien, charge or
other encumbrance to be created or imposed upon any such property by reason
thereof.

1.04      LITIGATION.  There is no litigation or other proceeding pending or
threatened against or affecting Borrower which if determined adversely to
Borrower or its interest would have a material adverse effect on the financial
condition of Borrower, and Borrower is not in default with respect to any order,
writ, injunction, decree or demand of any court or other governmental or
regulatory authority.

1.05      FINANCIAL CONDITION.  The balance sheet of Borrower as of March 31,
1998, a copy of which has heretofore been delivered to Bank by Borrower, and all
other statements and data submitted in writing by Borrower to Bank in connection
with this request for credit are true and correct, and said balance sheet truly
presents the financial condition of Borrower as of the date thereof, and has
been prepared in accordance with generally accepted accounting principles on a
basis consistently maintained.  Since such date, there have been no material
adverse changes in the financial condition or business of Borrower.  Borrower
has no knowledge of any liabilities, contingent or otherwise, at such date not
reflected in said balance sheet, and Borrower has not entered into any special
commitments or substantial contracts which are not reflected in said balance
sheet, other than in the ordinary and

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CREDIT AGREEMENT
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normal course of its business, which may have a materially adverse effect upon
its financial condition, operations or business as now conducted.

1.06      TITLE TO ASSETS. Borrower has good title to its assets, and the same
are not subject to any liens or encumbrances other than those permitted by
Section 3.03 hereof.

1.07      TAX STATUS.  Borrower has no liability for any delinquent state, local
or federal taxes, and, if Borrower has contracted with any government agency,
Borrower has no liability for renegotiation of profits.

1.08      TRADEMARKS, PATENTS.  Borrower, as of the date hereof, possesses all
necessary trademarks, trade names, copyrights, patents, patent rights, and
licenses to conduct its business as now operated, without any known conflict
with the valid trademarks, trade names, copyrights, patents and license rights
of others.

1.09      REGULATION U. None of the proceeds of any loan from the Bank to
Borrower shall be used to purchase or carry margin stock (as defined within
Regulation U of the Board of Governors of the Federal Reserve system).

2.    AFFIRMATIVE COVENANTS OF BORROWER

          Borrower agrees that so long as it is indebted to Bank, under
borrowings, or other indebtedness, it will, unless Bank shall otherwise consent
in writing:

2.01      RIGHTS AND FACILITIES.  Maintain and preserve all rights, franchises
and other authority adequate for the conduct of its business; maintain its
properties, equipment and facilities in good order and repair; conduct its
business in an orderly manner without voluntary interruption and, if a
corporation or partnership, maintain and preserve its existence.

2.02      INSURANCE.  Maintain public liability, property damage and workers'
compensation insurance and insurance on all its insurable property against fire
and other hazards with responsible insurance carriers to the extent usually
maintained by similar businesses and/or in the exercise of good business
judgment.

2.03      TAXES AND OTHER LIABILITIES.  Pay and discharge, before the same
become delinquent and before penalties accrue thereon, all taxes, assessments
and governmental charges upon or against it or any of its properties, and all
its other liabilities at any time existing, except to the extent and so long as:

          a.   The same are being contested in good faith and by appropriate
          proceedings in such manner as not to cause any materially adverse
          effect upon its financial condition or the loss of any right of
          redemption from any sale thereunder; and

          b.   It shall have set aside on its books reserves (segregated to the
          extent required by generally accepted accounting practice) deemed by
          it adequate with respect thereto.


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CREDIT AGREEMENT
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          All financial information referenced herein shall be interpreted and
          prepared in accordance with generally accepted accounting principals
          applied on a basis consistent with previous years.

2.04      FINANCIAL COVENANTS.  Borrower to maintain "Liquid Assets" of not less
than $25,000,000 at all times.  "Liquid Assets" will be defined as cash, cash
equivalents, short term investments, and corporate partner receivables (within
45 days of receipt) up to a maximum of $8,000,000.

2.05      RECORDS AND REPORTS.  Maintain a standard and modern system of
accounting in accordance with generally accepted accounting principles on a
basis consistently maintained; permit Bank's representatives to have access to,
and to examine its properties, books and records at all reasonable times and
upon reasonable notice during normal business hours; and furnish Bank:

          a.   MONTHLY COMPLIANCE REPORT.  Borrower to submit monthly compliance
          report attesting to "Liquid Asset" position and certified by an
          Officer of Borrower within 15 days of each month end.

          b.   QUARTERLY FINANCIAL STATEMENT.  Within forty five (45) days after
          the close of each quarter of each fiscal year of Borrower, commencing
          with the quarter next ending, Borrower to submit 1O-Q as of the close
          of such period and covering operations for the portion of Borrower's
          fiscal year ending on the last day of such period, all in reasonable
          detail, prepared in accordance with generally accepted accounting
          principles on a basis consistently maintained by Borrower and
          certified by an appropriate officer of Borrower;

          c.   ANNUAL FINANCIAL STATEMENT.  As soon as available, and in any
          event within one hundred twenty (120) days after the close of each
          fiscal year of Borrower, a 10-K report of Company as of the close of
          and for each fiscal year, all in reasonable detail, prepared on a
          audited basis, together with an unqualified opinion on such financial
          statements by an independent certified public accountant selected by
          Borrower and reasonably acceptable to Bank, in accordance with
          generally accepted accounting principles on a basis consistently
          maintained by Borrower and certified by an appropriate officer of
          Borrower;

          d.   OTHER INFORMATION.  Such other information relating to the
          affairs of Borrower as the Bank reasonably may request from time to
          time;

          e.   MANAGEMENT LETTER.  In connection with each fiscal year end
          financial statement furnished to Bank hereunder, any management letter
          of Borrower's independent certified public accountant.

2.06      NOTICE OF DEFAULT.  Promptly notify Bank in writing of the occurrence
of any Event of Default hereunder or any event which upon notice and lapse of
time would be an Event of Default.


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CREDIT AGREEMENT
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2.07      OPERATING ACCOUNTS.  Maintain most operating accounts with Bank during
the term of any loans from Bank to Borrower.  Borrower shall maintain, or cause
to be maintained, on deposit with Imperial Bank, non-interest bearing demand
deposit balances sufficient to compensate Bank for all services provided by
Bank.  Balances shall be calculated after reduction for the reserve requirement
of the Federal Reserve Board and uncollected funds.  Any deficiencies shall be
charged directly to the Borrower on a monthly basis.

2.08      ATTORNEY'S FEES.  Pay promptly to Bank without demand after notice,
with interest thereon from the date of expenditure at the rate applicable to any
loans from Bank to Borrower, reasonable attorneys' fees and all costs and
expenses paid or incurred by Bank in collecting or compromising any such loan
after the occurrence of an Event of Default, whether or not suit is filed.  If
suit is brought to enforce any provision of this Agreement, the prevailing party
shall be entitled to recover its reasonable attorneys' fees and court costs in
addition to any other remedy or recovery awarded by the court.

2.09      DOCUMENTATION FEE.  Pay to the Bank a $250.00 documentation fee per
facility at the time of execution of documents.

3.    NEGATIVE COVENANTS OF BORROWER

          Borrower agrees that so long as it is indebted to Bank, it will not,
without Bank's written consent:

3.01      TYPE OF BUSINESS.  Make any substantial change in the character of its
business.

3.02      OUTSIDE INDEBTEDNESS.  Other than in the ordinary course of business
and consistent with past practices, create, incur, assume or permit to exist any
indebtedness for borrowed moneys, other than loans from the Bank, except
obligations now existing as shown in the financial statement dated March 31,
1998, excluding those obligations being refinanced by Bank.

3.03      LIENS AND ENCUMBRANCES.  Other than in the ordinary course of business
which includes obtaining collaboration agreements with corporate partners, and
consistent with past practices, create, incur, or assume any mortgage, pledge,
encumbrance, lien or charge of any kind upon any asset now owned and given as
security in connection with this agreement, other than liens for taxes not
delinquent and liens in Bank's favor, except for those already existing as of
March 31, 1998.

3.04      LOANS, INVESTMENTS, SECONDARY LIABILITIES.  Make any loans or advances
to any person or other entity other than in the ordinary and normal course of
its business and consistent with past practices or make any investment in the
securities of any person or other entity inconsistent with company investment
guidelines; or guarantee or otherwise become liable upon the obligation of any
person or other entity, except by endorsement of negotiable instruments for
deposit or collection in the ordinary and normal course of its business and
consistent with past practices.  The foregoing will not restrict the Borrower
from issuing guarantees or otherwise becoming obligated to its landlords for
security deposits.


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3.05      ACQUISITION OR SALE OF BUSINESS; MERGER OR CONSOLIDATION.   Liquidate,
dissolve, merge or consolidate, or commence any proceedings therefor; or sell
any material assets except in the ordinary course of its business consistent
with past practices; or except in the ordinary course of business, sell, lease
assign or transfer any substantial part of its business or fixed assets, or any
property or other assets necessary for the continuance of its business as now
conducted, including without limitation the selling of any dividends, property
or other asset accompanied by the leasing back of the same.

4.    EVENTS OF DEFAULT

          The occurrence of any of the following events (each an "Event of
Default") shall, at Bank's option, terminate Bank's commitment to lend and make
all sums of principal and interest then remaining unpaid on all Borrower's
indebtedness to Bank immediately due and payable, all without demand,
presentment or notice, all of which are hereby expressly waived:

4.01      FAILURE TO PAY.  Failure to pay any installment of principal or
interest on any indebtedness of Borrower to Bank within 10 days of due date.

4.02      BREACH OF COVENANT.  Failure to perform any other term or condition of
this Agreement binding upon Borrower within 20 days of notice from Bank.

4.03      BREACH OF WARRANTY.  Any of Borrower's representations or warranties
made herein or any statement or certificate at any time given in writing
pursuant hereto or in connection herewith shall be false or misleading in any
respect.

4.04      INSOLVENCY; RECEIVER OR TRUSTEE.  Borrower shall become insolvent; or
admit its inability to pay its debts as they mature; or make an assignment for
the benefit of creditors; or apply for or consent to the appointment of a
receiver or trustee for it or for a substantial part of its property or
business.

4.05      JUDGMENTS, ATTACHMENTS.  Any money judgment greater than $100,000,
writ or warrant of attachment, or similar process shall be entered or filed
against Borrower or any of its assets and shall remain unvacated, unbonded or
unstayed for a period later than five days prior to the date of any proposed
sale thereunder.

4.06      BANKRUPTCY.  Bankruptcy, insolvency, reorganization or liquidation
proceedings or other proceedings for relief under any bankruptcy law or any law
for the relief of debtors, if not terminated within 60 days, shall be instituted
by or against Borrower and, if instituted against it, shall be consented to.

5.    MISCELLANEOUS PROVISIONS

5.01      FAILURE OR INDULGENCE NOT WAIVER.  No failure or delay on the part of
Bank or any holder of any note issued by Borrower to Bank, in the exercise of
any power, right or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other right, power or
privilege.


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CREDIT AGREEMENT
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All rights and remedies existing under this Agreement or any note issued in
connection with a loan that Bank may make hereunder, are cumulative to, and not
exclusive of, any rights or remedies otherwise available.

5.02      ADDITIONAL REMEDIES.  The rights, powers and remedies given to Bank
hereunder shall be cumulative and not alternative and shall be in addition to
all rights, powers and remedies given to Bank by law against Borrower or any
other person, including but not limited to Bank's rights of setoff or banker's
lien.

5.03      INUREMENT.  The benefits of this Agreement shall inure to the
successors and assigns of Bank and the permitted successors and assigns of
Borrower.

5.04      APPLICABLE LAW.  This Agreement and all other agreements and
instruments required by Bank in connection therewith shall be governed by and
construed according to the laws of the State of California, to the jurisdiction
of whose courts the parties hereby agree to submit.

5.05      OFFSET.  In addition to and not in limitation of all rights of offset
that Bank or other holder of any note issued by Borrower in favor of Bank may
have under applicable law, Bank or other holder of such notes shall, upon the
occurrence of any Event of Default or any event which with the passage of time
or notice would constitute such an Event of Default, have the right to
appropriate and apply to the payment of the outstanding under any such note any
and all balances, credits, deposits, accounts or monies of Borrower then or
thereafter with Bank or other holder, within ten (10) days after the Event of
Default, and notice of the occurrence of any Event of Default by Bank to
Borrower.

5.06      SEVERABILITY.  Should any one or more provisions of the Agreement be
determined to be illegal or unenforceable, all other provisions nevertheless
shall be effective.

5.07      TIME OF THE ESSENCE.  Time is hereby declared to be of the essence of
this Agreement and of every part hereof.

5.08      ACCOUNTING.  All accounting terms shall have the meanings applied
under generally accepted accounting principles unless otherwise specified.

5.10      MODIFICATION. This Agreement may be modified only by a writing signed
by both parties hereto.

5.11      JUDICIAL REFERENCE.

     (a)  Other than (i) nonjudicial foreclosure and all matters in connection
therewith regarding security interests in real or personal property; or (ii) the
appointment of a receiver, or the exercise of other provisional remedies (any
and all of which may be initiated pursuant to applicable law), each controversy,
dispute or claim between the parties arising out of or relating to this Credit
Agreement, any General Security Agreement executed by Borrower in favor of Bank
or any Note executed by Borrower in favor of Bank (collectively, in this Section
5.11, the "Agreement") which controversy, dispute or claim is not settled in
writing within thirty (30) days after the "CLAIM DATE" (defined as the date on
which


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CREDIT AGREEMENT
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a party subject to this Agreement gives written notice to all other parties that
a controversy, dispute or claim exists), will be settled by a reference
proceeding in California in accordance with the provisions of Section 638 ET SEQ
of the California Code of Civil Procedure, or their successor section ("CCP"),
which shall constitute the exclusive remedy for the settlement of any
controversy, dispute or claim concerning this Agreement, including whether such
controversy, dispute or claim is subject to the reference proceeding and except
as set forth above, the parties waive their rights to initiate any legal
proceedings against each other in any court or jurisdiction other than the
Superior Court in the County where the Real Property, if any, is located or San
Diego County if none (the "COURT").  The referee shall be a retired Judge of the
Court selected by mutual agreement of the parties, and if they cannot so agree
within forty-five (45) days after the Claim Date, the referee shall be promptly
selected by the Presiding Judge of the Court (or his representative).  The
referee shall be appointed to sit as a temporary judge, with all of the powers
for a temporary judge, as authorized by law, and upon selection should take and
subscribe to the oath of office as provided for in Rule 244 of the California
Rules of Court (or any subsequently enacted Rule).  Each party shall have one
peremptory challenge pursuant to CCP Section 170.6. The referee shall (a) be
requested to set the matter for hearing within sixty (60) days after the date of
selection of the referee and (b) try any and all issues of law or fact and
report a statement of decision upon them, if possible, within ninety (90) days
of the Claim Date.  Any decision rendered by the referee will be final, binding
and conclusive and judgment shall be entered pursuant to CCP Section 644 in any
court in the State of California having jurisdiction.  Any party may apply for a
reference proceeding at any time after thirty (30) days following notice to any
other party of the nature of the controversy, dispute or claim, by filing a
petition for a hearing and/or trial.  All discovery permitted by this Section
5.11 shall be completed no later than fifteen (15) days before the first hearing
date established by the referee.  The referee may extend such period in the
event of a party's refusal to provide requested discovery for any reason
whatsoever, including, without limitation, legal objections raised to such
discovery or unavailability of a witness due to absence or illness.  No party
shall be entitled to "priority" in conducting discovery.  Depositions may be
taken by either party upon seven (7) days written notice, and request for
production or inspection of documents shall be responded to within ten (10) days
after service.  All disputes relating to discovery which cannot be resolved by
the parties shall be submitted to the referee whose decision shall be final and
binding upon the parties.  Pending appointment of the referee as provided
herein, the Superior Court is empowered to issue temporary and/or provisional
remedies, as appropriate.

     (b)  Except as expressly set forth in this Section 5.11, the referee shall
determine the manner in which the reference proceeding is conducted including
the time and place of all hearings, the order of presentation of evidence, and
all other questions that arise with respect to the course of the reference
proceeding.  All proceedings and hearings conducted before the referee, except
for trial, shall be conducted without a court reporter except that when any
party so requests, a court reporter will be used at any hearing conducted before
the referee.  The party making such a request shall have the obligation to
arrange for and pay for the court reporter.  The costs of the court reporter at
the trial shall be borne equally by the parties.

     (c)  The referee shall be required to determine all issues in accordance
with existing case law and the statutory laws of the State of California.  The
rules of evidence applicable to proceedings at law in the State of California
will be applicable to the reference proceeding.  The referee shall be empowered
to enter equitable as well as legal relief, to provide all temporary and/or
provisional remedies and to enter equitable orders that will be binding upon the
parties.  The referee shall issue a single judgment at the close of the
reference proceeding which shall dispose of all of the claims of the parties
that are the


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subject of the reference.  The parties hereto expressly reserve the right to
contest or appeal from the final judgment or any appealable order or appealable
judgment entered by the referee.  The parties hereto expressly reserve the right
to findings of fact, conclusions of laws, a written statement of decision, and
the right to move for a new trial or a different judgment, which new trial, if
granted, is also to be a reference proceeding under this provision.

     (d)  In the event that the enabling legislation which provides for
appointment of a referee is repealed (and no successor statute is enacted),
any dispute between the parties that would otherwise be determined by the
reference procedure herein described will be resolved and determined by
arbitration.  The arbitration will be conducted by a retired judge of the Court,
in accordance with the California Arbitration Act, Section 1280 through Section
1294.2 of the CCP as amended from time to time.  The limitations with respect to
discovery as set forth hereinabove shall apply to any such arbitration
proceeding.

     This Agreement is executed on behalf of the parties by duly authorized
representatives as of June 17, 1998.

                              IMPERIAL BANK ("BANK")

                              BY:  /s/ Tim Bubnack
                                   ------------------------------
                                   Tim Bubnack, Vice President

                              Date:

                              ALLIANCE PHARMACEUTICAL, CORP. ("BORROWER")

                              BY:  /s/ Theodore D. Roth
                                   ------------------------------
                                   Theodore D. Roth, President

                              Date:

                              BY:  /s/ Tim T. Hart
                                   ------------------------------
                                   Tim T. Hart, Treasurer

                              Date:


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