THESE SECURITIES HAVE NOT BEEN
REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY
STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH
EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. 



ALLIANCE
PHARMACEUTICAL CORP. 



SENIOR CONVERTIBLE
PROMISSORY NOTE 


	$__________________	September ___, 2004 







        ALLIANCE
PHARMACEUTICAL CORP., a New York corporation (the “Company”), for value
received, promises to pay to the order of [_________], or its assigns (the
“Holder”), the principal sum of [Loan Amount] Dollars ($[________]), plus simple
interest thereon from the date of this Note until paid (or earlier converted as provided
below) at the rate of six percent (6%) per annum. 



        This
Note is issued pursuant to that certain Senior Convertible Promissory Note Purchase
Agreement dated as of September 21, 2004 between the Company and the initial Holder (the
“Purchase Agreement”). Certain capitalized terms used herein but not defined
herein shall have the meanings set forth in the Purchase Agreement The following is a
statement of the rights of the Holder and the conditions to which this Note is subject,
and to which the Holder, by the acceptance of this Note, agrees: 



        1.    Maturity.
Unless previously converted as provided for below, this Note           will automatically
mature and the entire unpaid principal amount, together with           accrued interest
through such date, shall become due and payable upon the first           to occur of (i)
[March __, 2006], and (ii) an Event of Default (as           defined below), such
first date to occur being the “Maturity Date.” 




        2.    Payment.
The payment of all principal and accrued interest under this           Note is to be made
on the Maturity Date or any prepayment dates and at the           address of the Holder
or at such other place in the United States as the Holder           shall designate to
the Company in writing, in lawful money of the United States           of America.  




        3.    Interest.
Interest on this Note shall be computed on the basis of a           365-day year and
actual days elapsed. No interest shall be payable until the           Maturity Date or
the date on which this Note is prepaid or required to be           prepaid. Upon an Event
of Default, the principal of the Note and any part           thereof shall thereafter
bear interest a the highest legal rate permissible           under the laws of the State
of New York.  





1 









        4.    Optional
Prepayment. This Note, plus all accrued and unpaid interest           through the
prepayment date, may be prepaid in whole or in part by the Company           without
penalty or additional fees at any time or from time to time upon fifteen           (15)
days prior written notice to the Holder, provided that such Holder may           convert
this Note into Common Stock of the Company in accordance with Section           1(a)
hereof prior to the end of such fifteen (15) day period.  




        5.    Conversion
of Note.  




            (a)    Voluntary
Conversion. If not sooner converted automatically as described           below, all
or part of the outstanding principal, and the accrued and unpaid           interest
thereon through the date of such conversion, of this Note may be           converted at
any time or from time to time prior to the Maturity Date, at the           option of the
Holder, into shares of Common Stock of the Company at a conversion           price per
share equal to twenty-five cents ($0.25), subject to adjustment in           accordance
with Section 12 hereof (the “Conversion Price”) by           delivering a
notice of such conversion (the “Conversion Notice”) to           the Company
along with the original of this Note.  




            (b)    Automatic
Conversion. All of the outstanding principal, and the accrued           and unpaid
interest thereon through the date of such conversion, of this Note           shall
automatically convert into Common Stock of the Company at the Conversion           Price:
(i) immediately prior to (A) the consummation of a consolidation or           merger of
the Company with or into any third party (whether or not the Company           is the
surviving corporation), or (B) the sale, assignment, conveyance, transfer           or
other disposition of all or substantially all of the Company’s           properties
or assets, in one or more related transactions, to another person, in           each case
where the gross proceeds to the Company in such transaction represent           an
aggregate amount equal to per share consideration of $0.50, but only if the
          Lender Committee (as defined in Section 4.11 of the Purchase Agreement) has
          approved such conversion in accordance with the provisions of the Purchase
          Agreement. In the event the Lender Committee does not approve such conversion
          and the Notes are to remain outstanding upon consummation of such transaction,
          the person formed by or surviving any such consolidation or merger (if other
          than the Company) or the person to which the such sale, assignment, transfer,
          conveyance or other disposition is to be made, must assume the Company’s
          obligations hereunder and, on the date of such transaction after giving pro
          forma effect thereto and any related financing transactions as if the same had
          occurred on the date of determination must be Creditworthy, (ii) on the date
          that (A) the average daily trading volume of shares of the Company’s
Common           Stock has been more than 250,000 shares, and (B) the volume weighted
average           price of a share of the Company’s Common Stock, as reported by
Bloomberg,           L.P., has been $0.50 or greater, in each case, for the forty-five
(45)           consecutive trading days prior to such date, provided that the shares of
Common           Stock to be issued upon such automatic conversion are then covered by an
          effective registration statement and are freely tradable by the holder thereof,
          or (iii) at the closing of a primary public offering of the Company’s
          Common Stock in which gross proceeds to the Company are equal to or greater
than           $25,000,000 and the sale price per share of Common Stock in such offering
is at           least $0.50.  




        6.    Mechanics
of Conversion.  





2 









            (a)              To
receive a certificate representing the shares of Common Stock into which the
          original of this Note shall be converted pursuant to Section 5 above, the
Holder           shall surrender the original of this Note accompanied by a Conversion
Notice to           the Company at its principal executive office set forth below. The
Company           shall, as soon as practicable, but not later than fifteen (15) business
days           after the date of receipt of this Note accompanied by a Conversion Notice,
issue           and deliver to a location in the United States designated by the Holder a
          certificate for the number of shares of the Company’s Common Stock to
which           the Holder shall be entitled as aforesaid (with such legends as may be
required           by the Purchase Agreement). Such conversion shall be deemed to have
been made on           the date of the Conversion Notice if conversion is pursuant to
Section 1(a)           above, or on the applicable date in the case of conversion
pursuant to Section           1(b) above (either, as applicable, the “Conversion Date”),
and the           Holder shall be treated for all purposes as the record holder of such
shares of           Common Stock as of such Conversion Date. If the Holder elects to
convert part,           but not all, of the outstanding principal amount and accrued but
unpaid           interest, then together with a stock certificate evidencing the
applicable           number of shares of Common Stock, the Company shall also issue a
replacement           Note in accordance with Section 3, with a principal amount equal to
the           principal amount not converted by the Holder into Common Stock.  




            (b)              The
Company shall not be required to issue fractions of shares upon conversion.           If
any fraction of a share would, but for this provision, be issuable upon any
          conversion, in lieu of such fractional share, Holder shall, upon delivery of a
          certificate representing the shares into which this Note shall be converted, be
          paid in cash the dollar amount (rounded to the nearest whole cent) determined
by           multiplying such fraction by the Conversion Price.  




            (c)              The
Company shall reserve and shall at all times have reserved out of its
          authorized but unissued shares of Common Stock a sufficient number of shares to
          permit the conversion of the unpaid amount (including principal and accrued
          interest) of this Note. All shares of Common Stock that may be issued upon
          conversion of this Note shall be validly issued, fully paid and nonassessable.  




        7.    Charges,
Taxes and Expenses. Issuance of replacement Notes shall be made           without
charge to the Holder for any issue or transfer tax or other incidental           expense
in respect of the issuance of such Note(s), all of which taxes and           expenses
shall be paid by the Company, and such Note(s) shall be issued in the           name of
the Holder, or such Note(s) shall be issued in such name or names as may           be
directed by the Holder; provided, however, that in the event replacement           Notes
are to be issued in a name other than the name of the Holder, this Note,           when
surrendered for exercise or transfer, shall be accompanied by the           Assignment
Form attached hereto as Attachment A duly executed by the Holder; and           provided
further, that upon any transfer involved in the issuance or delivery of           any
replacement Notes, the Company may require, as a condition thereto, the           payment
of a sum sufficient to reimburse it for any transfer tax incidental           thereto.
Any transfer shall be subject to (i) the transferee’s agreement in           writing
to be subject to the applicable terms of this Note and (ii) compliance           with all
applicable state and federal securities laws (including the delivery of           legal
opinions reasonably satisfactory to the Company, if such are reasonably
          requested by the Company).  




        8.    Default.
Each of the following events shall be an “Event of           Default” hereunder:  




            (a)              The
Company fails to pay timely any of the principal amount, accrued interest or
          other amounts due under this Note on the date any of the same become due and
          payable;  




3 










            (b)              The
Company takes any action prohibited by any of the Restrictive Covenants set
          forth in the Purchase Agreement without the written approval of the Lender
          Committee;  




            (c)              The
Company files any petition or action for relief under any bankruptcy,
          reorganization, insolvency or moratorium law or any other law for the relief
of,           or relating to, debtors, now or hereafter in effect, or makes any
assignment for           the benefit of creditors;  




            (d)              An
involuntary petition is filed against the Company (unless such petition is
          dismissed or discharged within sixty (60) days) under any bankruptcy statute
now           or hereafter in effect, or a custodian, receiver, trustee, assignee for the
          benefit of creditors (or other similar official) is appointed to take
          possession, custody or control of any property of the Company;  




            (e)              The
Company defaults under any mortgage, indenture or financial instrument under
          which there may be issued or by which there may be secured or evidenced any
          indebtedness for money borrowed by the Company (or the payment of which is
          guaranteed by the Company) whether such indebtedness or guarantee now exists,
or           is created after the date hereof, if that default results in the
acceleration of           such indebtedness prior to its stated maturity; or  




            (f)              The
Company fails to pay final judgments aggregating $250,000 or more, which
          judgments are not paid, discharged or stayed for a period of 60 days.  




        In
the case of an Event of Default arising from events described in clause (c) or (d) above,
all outstanding Notes will become due and payable immediately without further action or
notice and without presentment, demand, protest, notice of any kind or notice of dishonor,
all of which are hereby expressly waived. Upon the occurrence of any other Event of
Default hereunder, all unpaid principal, accrued interest and other amounts owing
hereunder shall, at the option of, and upon written notice provided to the Company
exclusively by the Holder be immediately due, payable and collectible by the Holder
pursuant to applicable law without presentment, demand, protest, notice of any kind or
notice of dishonor, all of which are hereby expressly waived. 



        The
Company hereby waives demand, presentment, notice of dishonor, diligence, protest, notice
of protest and all other notices or demands relating to this Note. 



        If
an Event of Default occurs and is continuing, the Holder may pursue any available remedy
by proceeding at law or in equity to collect the payment of amounts due on this Note or to
enforce the performance of any provision of this Note. A delay or omission by the Holder
in exercising any right or remedy accruing upon an Event of Default shall not impair the
right or remedy or constitute a waiver of or acquiescence in the Event of Default. A
waiver on any one occasion shall not be construed as a bar to or waiver of any such right
or remedy on any future occasion. No remedy is exclusive of any other remedy. All
available remedies are cumulative to the extent permitted by law. 



        9.    Loss,
Theft or Destruction of Note. Upon receipt by the Company of           evidence
reasonably satisfactory to it of the loss, theft or destruction of this           Note
and of indemnity or security reasonably satisfactory to it, the Company           will
make and deliver a replacement Note in accordance with Section 3 hereof           which
shall carry the same rights to interest carried by this Note, stating that           such
Note is issued in replacement of this Note, making reference to the           original
date of issuance of this Note (and any successors hereto) and dated as           of such
cancellation.  





4 









        10.    Registration
Rights. The Holder is entitled to the benefit of certain           registration
rights with respect to the shares of Common Stock issuable upon           conversion of
this Note as provided in the Registration Rights Agreement.  




        11.    Reservation
of Conversion Shares. The Company covenants that it will at           all times
reserve and keep available out of the aggregate of its authorized but           unissued
and otherwise unreserved Common Stock, solely for the purpose of           enabling it to
issue the Conversion Shares upon conversion of this Note as           herein provided,
the number of Conversion Shares which are then issuable and           deliverable upon
conversion of the entire principal amount and accrued interest           under this Note,
free from preemptive rights or any other contingent purchase           rights of Persons
other than the Holder (taking into account the adjustments and           restrictions of
Section 12). The Company covenants that all Conversion           Shares so
issuable and deliverable shall, upon issuance and the payment of the           applicable
Conversion Price in accordance with the terms hereof, be duly and           validly
authorized, issued and fully paid and nonassessable.  




        12.    Certain
Adjustments. The Conversion Price and number of Conversion Shares           issuable
upon conversion of this Note are subject to adjustment from time to           time as set
forth in this Section 12.  




            (a)              If
the Company shall, at any time or from time to time while this Note is
          outstanding, pay a dividend or make a distribution on its Common Stock in
shares           of Common Stock, subdivide its outstanding shares of Common Stock into a
greater           number of shares or combine its outstanding shares of Common Stock into
a           smaller number of shares or issue by reclassification of its outstanding
shares           of Common Stock any shares of its capital stock (including any such
          reclassification in connection with a consolidation or merger in which the
          Company is the continuing corporation), then the number of Conversion Shares
          purchasable upon conversion of this Note and the Conversion Price in effect
          immediately prior to the date upon which such change shall become effective,
          shall be adjusted by the Company so that the Holder thereafter converting this
          Note shall be entitled to receive the number of shares of Common Stock or other
          capital stock which the Holder would have received if the Note had been fully
          converted immediately prior to such event upon payment of a Conversion Price
          that has been adjusted to reflect a fair allocation of the economics of such
          event to the Holder. Such adjustments shall be made successively whenever any
          event listed above shall occur.  




            (b)              If
any capital reorganization, reclassification of the capital stock of the
          Company, consolidation or merger of the Company with another corporation in
          which the Company is not the survivor, or sale, transfer or other disposition
of           all or substantially all of the Company’s assets to another corporation
          shall be effected, then, the Company shall use its reasonable best efforts to
          ensure that lawful and adequate provision shall be made whereby each Holder
          shall thereafter have the right to purchase and receive upon the basis and upon
          the terms and conditions herein specified and in lieu of the Conversion Shares
          immediately theretofore issuable upon conversion of this Note, such shares of
          stock, securities or assets as would have been issuable or payable with respect
          to or in exchange for a number of Conversion Shares equal to the number of
          Conversion Shares immediately theretofore issuable upon conversion of this
Note,           had such reorganization, reclassification, consolidation, merger, sale,
transfer           or other disposition not taken place, and in any such case appropriate
provision           shall be made with respect to the rights and interests of each Holder
to the end           that the provisions hereof (including, without limitation, provision
for           adjustment of the Conversion Price) shall thereafter be applicable, as
nearly           equivalent as may be practicable in relation to any shares of stock,
securities           or assets thereafter deliverable upon the exercise thereof. The
Company shall           not effect any such consolidation, merger, sale, transfer or
other disposition           unless prior to or simultaneously with the consummation
thereof the successor           corporation (if other than the Company) resulting from
such consolidation or           merger, or the corporation purchasing or otherwise
acquiring such assets or           other appropriate corporation or entity shall assume
the obligation to deliver           to the holder of this Note, at the last address of
such holder appearing on the           books of the Company, such shares of stock,
securities or assets as, in           accordance with the foregoing provisions, such
holder may be entitled to           purchase, and the other obligations under this Note.
The provisions of this           Section 12(b) shall similarly apply to successive
reorganizations,           reclassifications, consolidations, mergers, sales, transfers
or other           dispositions.  




5 










            (c)              In
case the Company shall fix a payment date for the making of a distribution to
          all holders of Common Stock (including any such distribution made in connection
          with a consolidation or merger in which the Company is the continuing
          corporation) of evidences of indebtedness or assets (other than cash dividends
          or cash distributions payable out of consolidated earnings or earned surplus or
          dividends or distributions referred to in Section 12(a)), or
subscription           rights or warrants, the Conversion Price to be in effect after
such payment date           shall be determined by multiplying the Conversion Price in
effect immediately           prior to such payment date by a fraction, the numerator of
which shall be the           total number of shares of Common Stock outstanding
multiplied by the Market           Price per share of Common Stock immediately prior to
such payment date, less the           fair market value (as determined by the Company’s
Board of Directors in           good faith) of said assets or evidences of indebtedness
so distributed, or of           such subscription rights or warrants, and the denominator
of which shall be the           total number of shares of Common Stock outstanding
multiplied by such Market           Price per share of Common Stock immediately prior to
such payment date. The           Board of Directors of the Company shall respond
promptly, in writing, to an           inquiry by the Holder prior to the exercise
hereunder as to the Market Price of           a share of Common Stock as determined by
the Board of Directors of the Company.           For purposes of this Note, “Market
Price” means, as of a           particular date (the “Valuation Date”)
the following: (a) if           the Common Stock is then listed on a national stock
exchange, the Market Price           shall be the closing sale price of one share of
Common Stock on such exchange on           the last trading day prior to the Valuation
Date, provided that if such stock           has not traded in the prior ten (10) trading
sessions, the Market Price shall be           the average closing price of one share of
Common Stock in the most recent ten           (10) trading sessions during which the
Common Stock has traded; (b) if the           Common Stock is then included in The Nasdaq
Stock Market, Inc.           (“Nasdaq”), the Market Price shall be the
closing sale price of           one share of Common Stock on Nasdaq on the last trading
day prior to the           Valuation Date or, if no such closing sale price is available,
the average of           the high bid and the low ask price quoted on Nasdaq as of the
end of the last           trading day prior to the Valuation Date, provided that if such
stock has not           traded in the prior ten (10) trading sessions, the Market Price
shall be the           average closing price of one share of Common Stock in the most
recent ten (10)           trading sessions during which the Common Stock has traded; (c)
if the Common           Stock is then included in the Over-the-Counter Bulletin Board,
the Market Price           shall be the closing sale price of one share of Common Stock
on the           Over-the-Counter Bulletin Board on the last trading day prior to the
Valuation           Date or, if no such closing sale price is available, the average of
the high bid           and the low ask price quoted on the Over-the-Counter Bulletin
Board as of the           end of the last trading day prior to the Valuation Date,
provided that if such           stock has not traded in the prior ten (10) trading
sessions, the Market Price           shall be the average closing price of one share of
Common Stock in the most           recent ten (10) trading sessions during which the
Common Stock has traded, (d)           if the Common Stock is then included in the “pink
sheets,” the Market           Price shall be the closing sale price of one share of
Common Stock on the           “pink sheets” on the last trading day prior to
the Valuation Date or,           if no such closing sale price is available, the average
of the high bid and the           low ask price quoted on the “pink sheets” as
of the end of the last           trading day prior to the Valuation Date, provided that
if such stock has not           traded in the prior ten (10) trading sessions, the Market
Price shall be the           average closing price of one share of Common Stock in the
most recent ten (10)           trading sessions during which the Common Stock has traded.  





6 









            (d)    Calculations.
All calculations under this Section 12 shall be made           to the nearest cent
or the nearest 1/100th of a share, as applicable.           The number of
shares of Common Stock outstanding at any given time shall not           include shares
owned or held by or for the account of the Company, and the           disposition of any
such shares shall be considered an issue or sale of Common           Stock.  




            (e)    Notice
of Adjustments. Upon the occurrence of each adjustment pursuant to           this Section
12, the Company at its expense will promptly compute such           adjustment in
accordance with the terms of this Note and prepare a certificate           setting forth
such adjustment, including a statement of the adjusted Conversion           Price and
adjusted number or type of Conversion Shares or other securities           issuable upon
conversion of this Note (as applicable), describing the           transactions giving
rise to such adjustments and showing in detail the facts           upon which such
adjustment is based. Upon written request, the Company will           promptly deliver a
copy of each such certificate to the Holder and to the           Company’s transfer
agent.  




        13.    Miscellaneous.  




            (a)    Issue
Date; Governing Law. The provisions of this Note shall be construed           and
shall be given effect in all respect as if it had been issued and delivered           by
the Company on the earlier of the date hereof or the date of issuance of any
          Note for which this Note is issued in replacement. This Note shall be binding
          upon any successors or assigns of the Company. This Note shall constitute a
          contract under the laws of the State of New York and for all purposes shall be
          construed in accordance with and governed by the laws of said state, excluding
          its conflicts of law principles.  




            (b)    Assignment.
This Note shall be binding upon and inure to the benefit of           the parties and
their successors and permitted assigns. The Holder may assign           any or all of its
rights under this Note to any Person in accordance with           applicable securities
laws and regulations, provided such transferee agrees in           writing to be bound by
the provisions of this Note and the provisions of the           Purchase Agreement that
apply to the “Lenders.” 




            (c)    Notices.
A notice required hereby shall be made in accordance with the           notice provision
set forth in Section 7.3 of the Purchase Agreement  




7 










            (d)    Amendment
or Waiver. Except as expressly set forth herein or in the           Purchase
Agreement, provisions of this Note may only be amended or waived by a           writing
signed by a majority of the of the Lender Committee (as defined in           Section 4.12
of the Purchase Agreement.  




[Remainder of Page
Intentionally Left Blank]  




































8 









        IN
WITNESS WHEREOF,  ALLIANCE  PHARMACEUTICAL CORP. has caused this Senior Convertible
 Promissory Note to be executed by its officer thereunto duly authorized. 






		COMPANY:
	
 	ALLIANCE PHARMACEUTICAL CORP.
	

 	By:__________________________________________
		Name:    Duane Roth
		Title:      Chief Executive Officer





































9 












ATTACHMENT A TO NOTE 



ASSIGNMENT FORM 



(To assign the
foregoing Note, execute 
this form and supply required information.)  



        FOR
VALUE RECEIVED, and subject to compliance with applicable federal and state securities
laws (including the delivery of legal opinions satisfactory to the Company, if such are
requested by the Company), an interest corresponding to the unpaid principal amount of the
foregoing Note and all rights evidenced thereby are hereby assigned to 




____________________________________________________________________________________________________________________________________________
(Please
Print) 



whose address is ___________________________________________ 



Dated: ________________________ 



Holder's Signature: ______________________________ 



Holder's Address: _______________________________



	 	
_______________________________  






Signature Guaranteed: ___________________________________________  






	NOTE:  	The
signature to this Assignment Form must correspond with the name as it appears on the face
of the Note, without alteration or enlargement or any change whatever, and must be
guaranteed by a bank or trust company. Officers of corporations and those acting in a
fiduciary or other representative capacity should file proper evidence of authority to
assign the foregoing Note.  






	 	
The
assignee of the Note, in connection with the execution of this Assignment Form, must
execute and deliver an acknowledgment of, and agreement to be bound by, the terms of the
Note and Purchase Agreement related thereto.