Document:

NEITHER THESE SECURITIES NOR THE
SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES HAVE 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. 

WARRANT 

	Warrant No. [   ]  	Original
Issue Date: [   ], 2004

        Alliance
Pharmaceutical Corp., a New York corporation (the “Company”), hereby
certifies that, for value received, [     ] or its registered assigns (the
“Holder”), is entitled to purchase from the Company up to a total of [        ]1 shares
of Common Stock (each such share, a “Warrant Share”
and all such shares, the “Warrant Shares”), at any time and from time to
time from and after the Original Issue Date and through and including [     ], 2009 (the
“Expiration Date”), and subject to the following terms and conditions: 

        1.        Definitions.
As used in this Warrant, the following terms shall have the           respective
definitions set forth in this Section 1. Capitalized terms that are           used and
not defined in this Warrant that are defined in the Purchase Agreement           (as
defined below) shall have the respective definitions set forth in the           Purchase
Agreement.  

        “Business
Day” means any day except Saturday, Sunday and any day that is a federal legal
holiday in the United States or a day on which banking institutions in the State of New
York are authorized or required by law or other government action to close. 

        “Common
Stock” means the common stock of the Company, par value $.01 per share, and any
securities into which such common stock may hereafter be reclassified. 

1  A number of shares as
equals 75% of the Shares issuable to such investor at Closing under the Purchase
Agreement.  

        “Exercise
Price” means $.50, subject to adjustment in accordance with Section 10. 

        “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. 

        “New
York Courts” means the state and federal courts sitting in the City of New York,
Borough of Manhattan. 

        “Original
Issue Date” means the Original Issue Date first set forth on the first page of
this Warrant. 

        “Purchase
Agreement” means the Securities Purchase Agreement, dated May [ ], 2004, to which
the Company and the original Holder are parties. 

        “Registration
Rights Agreement” means the Registration Rights Agreement, dated May [ ], 2004,
to which the Company and the original Holder are parties. 

        “Trading
Day” means (i) a day on which the Common Stock is traded on a Trading Market
(other than the OTC Bulletin Board), or (ii) if the Common Stock is not listed on a
Trading Market (other than the OTC Bulletin Board), a day on which the Common Stock is
traded in the over-the-counter market, as reported by the OTC Bulletin Board, or (iii) if
the Common Stock is not quoted on any Trading Market, a day on which the Common Stock is
quoted in the over-the-counter market as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding to its functions of
reporting prices); provided, that in the event that the Common Stock is not listed or
quoted as set forth in (i), (ii) and (iii) hereof, then Trading Day shall mean a Business
Day. 

2 

        2.        Registration
of Warrant. The Company shall register this Warrant upon           records to be
maintained by the Company for that purpose (the “Warrant           Register”),
in the name of the record Holder hereof from time to time.           The Company may deem
and treat the registered Holder of this Warrant as the           absolute owner hereof
for the purpose of any exercise hereof or any distribution           to the Holder, and
for all other purposes, absent actual notice to the contrary.  

        3.        Registration
of Transfers. The Company shall register the transfer of any           portion of
this Warrant in the Warrant Register, upon surrender of this Warrant,           with the
Form of Assignment attached hereto duly completed and signed, to the           Company at
its address specified herein. Upon any such registration or transfer,           a new
Warrant to purchase Common Stock, in substantially the form of this           Warrant
(any such new Warrant, a “New Warrant”), evidencing the
          portion of this Warrant so transferred shall be issued to the transferee and a
          New Warrant evidencing the remaining portion of this Warrant not so
transferred,           if any, shall be issued to the transferring Holder. The acceptance
of the New           Warrant by the transferee thereof shall be deemed the acceptance by
such           transferee of all of the rights and obligations of a holder of a Warrant.  

        4.        Duration
of Warrants. This Warrant shall be exercisable by the registered           Holder at
any time and from time to time on or after the Original Issue Date           through and
including the Expiration Date. Subject to the provisions of Section 16 below, at
6:30 p.m., New York City time on the Expiration Date           the portion of this
Warrant not exercised prior thereto shall be and become void           and of no value.  

        5.        Exercise;
Delivery of Warrant Shares.  

	 	        (a)              To
effect exercises hereunder, the Holder shall not be required to physically
          surrender this Warrant unless the aggregate Warrant Shares represented by this
          Warrant is being exercised. Upon delivery of the Exercise Notice (in the form
          attached hereto) to the Company (with the attached Warrant Shares Exercise Log)
          at its address for notice set forth herein and upon payment of the Exercise
          Price (by wire transfer, cash or certified check) multiplied by the number of
          Warrant Shares that the Holder intends to purchase hereunder, the Company shall
          promptly (but in no event later than three Trading Days after the Date of
          Exercise (as defined herein)) issue and deliver to the Holder, a certificate
for           the Warrant Shares issuable upon such exercise. The Company shall, upon
request           of the Holder and subsequent to the date on which a registration
statement           covering the resale of the Warrant Shares has been declared effective
by the           Securities and Exchange Commission, use its best commercially reasonable
efforts           to deliver Warrant Shares hereunder electronically through the
Depository Trust           Corporation or another established clearing corporation
performing similar           functions, if available, provided, that, the Company may,
but will not be           required to change its transfer agent if its current transfer
agent cannot           deliver Warrant Shares electronically through the Depository Trust
Corporation.           A “Date of Exercise” means the date on which the
Holder shall           have delivered to the Company: (i) the Exercise Notice (with the
Warrant           Exercise Log attached to it), appropriately completed and duly signed
and (ii)           payment of the Exercise Price for the number of Warrant Shares so
indicated by           the Holder to be purchased.  

3 

	 	        (b)              If
by the third Trading Day after a Date of Exercise the Company fails to           deliver
the required number of Warrant Shares in the manner required pursuant to Section 5(a),
then the Holder will have the right to rescind such           exercise.  

	 	        (c)              The
Company’s obligations to issue and deliver Warrant Shares in accordance
          with the terms hereof are absolute and unconditional, irrespective of any
action           or inaction by the Holder to enforce the same, any waiver or consent
with           respect to any provision hereof, the recovery of any judgment against any
Person           or any action to enforce the same, or any setoff, counterclaim,
recoupment,           limitation or termination, or any breach or alleged breach by the
Holder or any           other Person of any obligation to the Company or any violation or
alleged           violation of law by the Holder or any other Person, and irrespective of
any           other circumstance which might otherwise limit such obligation of the
Company to           the Holder in connection with the issuance of Warrant Shares.
Nothing herein           shall limit a Holder’s right to pursue any other remedies
available to it           hereunder, at law or in equity including, without limitation, a
decree of           specific performance and/or injunctive relief with respect to the
Company’s           failure to timely deliver certificates representing Warrant
Shares upon exercise           of the Warrant as required pursuant to the terms hereof.  

	 	        (d)              Notwithstanding
anything herein to the contrary, in no event shall the Holder be           entitled to
exercise any portion of this Warrant in excess of that portion of           this Warrant
upon exercise of which the sum of (1) the number of shares of           Common Stock
beneficially owned by the Holder and its Affiliates (other than           shares of
Common Stock which may be deemed beneficially owned through the           ownership of
the unexercised portion of the Warrant or the unexercised or           unconverted
portion of any other security of the Holder subject to a limitation           on
conversion analogous to the limitations contained herein) and (2) the number           of
shares of Common Stock issuable upon the exercise of the portion of this
          Warrant with respect to which the determination of this proviso is being made,
          would result in beneficial ownership by the Holder and its Affiliates of more
          than 9.99% of the then outstanding shares of Common Stock. As used herein, the
          term “Affiliate” means any person or entity that, directly or
          indirectly through one or more intermediaries, controls or is controlled by or
          is under common control with a person or entity, as such terms are used in and
          construed under Rule 144 under the Securities Act. For purposes of the proviso
          to the immediately preceding sentence, beneficial ownership shall be determined
          in accordance with Section 13(d) of the Securities Exchange Act of 1934, as
          amended, and Regulations 13D-G thereunder, except as otherwise provided in
          clause (1) of such proviso. The Holder may waive the limitations set forth
          herein by sixty-one (61) days written notice to the Company.  

        6.        Call
Provision. Subject to the last sentence of this Section 6,           beginning
on the date that is one year after the date of this Warrant, the           Company may
call this Warrant, in whole but not in part (except as set forth in           the last
sentence of this Section 6), at a redemption price equal to $0.01 per           share of
Common Stock then purchasable pursuant to this Warrant upon thirty (30)           days
prior written notice (the “Notice Period”) to the Holder if the
          closing bid price of a share of Common Stock as traded on the Trading Market
(as           defined in the Purchase Agreement) equals or exceeds $3.00 (appropriately
          adjusted for any stock split, reverse stock split, stock dividend or other
          reclassification or combination of the Common Stock occurring after the date
          hereof) for twenty (20) consecutive Trading Days, provided that on the date of
          such notice, and during the entire Notice Period, all of the shares of Common
          Stock issuable hereunder either (a) are registered pursuant to an effective
          Registration Statement which is available for sales of such shares of Common
          Stock during the entire Notice Period or (b) no longer constitute Registrable
          Securities. Notwithstanding any such notice by the Company, but subject to the
          provisions of Section 5(d), the Holder shall have the right to exercise
          this Warrant prior to the end of the Notice Period. For the avoidance of doubt,
          and notwithstanding anything herein to the contrary, the provisions of this Section
6 shall not apply to, and the Company may not call that portion           of, the
shares underlying this Warrant that are not then exercisable by virtue           of Section
5(d).  

4 

        7.        Charges,
Taxes and Expenses. Issuance and delivery of Warrant Shares upon           exercise
of this Warrant shall be made without charge to the Holder for any           issue or
transfer tax, withholding tax, transfer agent fee or other incidental           tax or
expense in respect of the issuance of such certificates, all of which           taxes and
expenses shall be paid by the Company; provided, however, that the           Company
shall not be required to pay any tax which may be payable in respect of           any
transfer involved in the registration of any certificates for Warrant Shares           or
Warrants in a name other than that of the Holder. The Holder shall be
          responsible for all other tax liability that may arise as a result of holding
or           transferring this Warrant or receiving Warrant Shares upon exercise hereof.  

        8.        Replacement
of Warrant. If this Warrant is mutilated, lost, stolen or           destroyed, the
Company shall issue or cause to be issued in exchange and           substitution for and
upon cancellation hereof, or in lieu of and substitution           for this Warrant, a
New Warrant, but only upon receipt of evidence reasonably           satisfactory to the
Company of such loss, theft or destruction and customary and           reasonable
indemnity (which shall not include a surety bond), if requested.           Applicants for
a New Warrant under such circumstances shall also comply with           such other
reasonable regulations and procedures and pay such other reasonable           third-party
costs as the Company may prescribe. If a New Warrant is requested as           a result
of a mutilation of this Warrant, then the Holder shall deliver such           mutilated
Warrant to the Company as a condition precedent to the Company’s
          obligation to issue the New Warrant.  

        9.        Reservation
of Warrant 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 Warrant Shares upon exercise of this Warrant as herein           provided, the
number of Warrant Shares which are then issuable and deliverable           upon the
exercise of this entire Warrant, 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 10). The Company
          covenants that all Warrant Shares so issuable and deliverable shall, upon
          issuance and the payment of the applicable Exercise Price in accordance with
the           terms hereof, be duly and validly authorized, issued and fully paid and
          nonassessable.  

        10.        Certain
Adjustments. The Exercise Price and number of Warrant Shares           issuable upon
exercise of this Warrant are subject to adjustment from time to           time as set
forth in this Section 10.  

5 

	 	        (a)              If
the Company shall, at any time or from time to time while this Warrant 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 Warrant Shares
          purchasable upon exercise of the Warrant and the Exercise 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 exercising the
          Warrant shall be entitled to receive the number of shares of Common Stock or
          other capital stock which the Holder would have received if the Warrant had
been           fully exercised immediately prior to such event upon payment of an
Exercise           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 Warrant Shares
          immediately theretofore issuable upon exercise of the Warrant, such shares of
          stock, securities or assets as would have been issuable or payable with respect
          to or in exchange for a number of Warrant Shares equal to the number of Warrant
          Shares immediately theretofore issuable upon exercise of the Warrant, 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 Exercise 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           the Warrant, 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 Warrant. The provisions of this
Section 10(b) shall           similarly apply to successive reorganizations,
reclassifications,           consolidations, mergers, sales, transfers or other
dispositions.  

	 	        (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 10(a)), or
subscription           rights or warrants, the Exercise Price to be in effect after such
payment date           shall be determined by multiplying the Exercise 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  

6 

	 	        (d)    Number
of Warrant Shares. Simultaneously with any adjustment to the           Exercise Price
pursuant to this Section 10, the number of Warrant Shares           that may be
purchased upon exercise of this Warrant shall be increased or           decreased
proportionately, so that after such adjustment the aggregate Exercise           Price
payable hereunder for the adjusted number of Warrant Shares shall be the           same
as the aggregate Exercise Price in effect immediately prior to such           adjustment.  

	 	        (e)    Calculations.
All calculations under this Section 10 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.  

	 	        (f)    Notice
of Adjustments. Upon the occurrence of each adjustment pursuant to           this Section
10, the Company at its expense will promptly compute such           adjustment in
accordance with the terms of this Warrant and prepare a           certificate setting
forth such adjustment, including a statement of the adjusted           Exercise Price and
adjusted number or type of Warrant Shares or other securities           issuable upon
exercise of this Warrant (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.  

	 	        (g)    Notice
of Corporate Events. If the Company (i) declares a dividend or any           other
distribution of cash, securities or other property in respect of its           Common
Stock, including without limitation any granting of rights or warrants to
          subscribe for or purchase any capital stock of the Company or any Subsidiary,
          (ii) authorizes or approves, enters into any agreement contemplating or
solicits           stockholder approval for any Fundamental Transaction or (iii)
authorizes the           voluntary dissolution, liquidation or winding up of the affairs
of the Company,           then the Company shall deliver to the Holder a notice
describing the material           terms and conditions of such transaction (but only to
the extent such disclosure           would not result in the dissemination of material,
non-public information to the           Holder) at least 10 calendar days prior to the
applicable record or effective           date on which a Person would need to hold Common
Stock in order to participate           in or vote with respect to such transaction, and
the Company will take all steps           reasonably necessary in order to insure that
the Holder is given the practical           opportunity to exercise this Warrant prior to
such time so as to participate in           or vote with respect to such transaction;
provided, however, that the failure to           deliver such notice or any defect
therein shall not affect the validity of the           corporate action required to be
described in such notice.  

7 

        11.        No
Fractional Shares. No fractional shares of Warrant Shares will be           issued in
connection with any exercise of this Warrant. In lieu of any           fractional shares
which would, otherwise be issuable, the Company shall pay cash           equal to the
product of such fraction multiplied by the closing price of one           Warrant Share
as reported by the applicable Trading Market on the date of           exercise.  

        12.        Notices.
Any and all notices or other communications or deliveries           hereunder (including,
without limitation, any Exercise Notice) shall be in           writing and shall be
deemed given and effective on the earliest of (i) the date           of transmission, if
such notice or communication is delivered via facsimile at           the facsimile number
specified in this Section prior to 6:30 p.m. (New York City           time) on a Trading
Day, (ii) the next Trading 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 Trading Day or           later than 6:30 p.m. (New
York City time) on any Trading Day, (iii) the Trading           Day following the date of
mailing, if sent by nationally recognized overnight           courier service, or (iv)
upon actual receipt by the party to whom such notice is           required to be given.
The addresses for such communications shall be: (i) if to           the Company, to
Alliance Pharmaceutical Corp., Attn: President, or to Facsimile           No.: (858)
410-5201 (or such other address as the Company shall indicate in           writing in
accordance with this Section), or (ii) if to the Holder, to the           address or
facsimile number appearing on the Warrant Register or such other           address or
facsimile number as the Holder may provide to the Company in           accordance with
this Section.  

        13.        Warrant
Agent. The Company shall serve as warrant agent under this           Warrant. Upon 10
days’ notice to the Holder, the Company may appoint a new           warrant agent.
Any corporation into which the Company or any new warrant agent           may be merged
or any corporation resulting from any consolidation to which the           Company or any
new warrant agent shall be a party or any corporation to which           the Company or
any new warrant agent transfers substantially all of its           corporate trust or
shareholders services business shall be a successor warrant           agent under this
Warrant without any further act. Any such successor warrant           agent shall
promptly cause notice of its succession as warrant agent to be           mailed (by first
class mail, postage prepaid) to the Holder at the Holder’s           last address as
shown on the Warrant Register.  

        14.        Cashless
Exercise. Notwithstanding any other provision contained herein           to the
contrary, from and after the first anniversary of the Original Issue           Date, if
the Warrant Shares may not be freely sold to the public for any reason           other
than an Allowed Delay as such term is defined in Section 2(b)(ii) of the
          Registration Rights Agreement (including, but not limited to, the failure of
the           Company to have effected the registration of the Warrant Shares or to have
a           current prospectus available for delivery or otherwise), the Holder may elect
to           receive, without the payment by the Holder of the aggregate Exercise Price
in           respect of the shares of Common Stock to be acquired, shares of Common Stock
          equal to the value of this Warrant or any portion hereof by the surrender of
          this Warrant (or such portion of this Warrant being so exercised) together with
          the Net Issue Election Notice annexed hereto duly executed, at the office of
the           Company. Thereupon, the Company shall issue to the Holder such number of
fully           paid, validly issued and nonassessable shares of Common Stock as is
computed           using the following formula:  

8 

		
	X    =	Y (A - B)

		A

where  

                      X  =  
the number of shares of Common  Stock  which the Holder has then  requested  be
issued to the Holder;  

                      Y  =  
the total  number of shares of Common Stock  covered by this Warrant  which the
Holder has surrendered at such time for cashless exercise (including both shares to be
issued to the Holder and shares to be canceled as payment therefor);  

                      A  =  
the  "Market  Price" of one share of Common  Stock as at the time the net issue
election is made; and  

                      B  =  
the  Exercise  Price in effect  under  this  Warrant  at the time the net issue
election is made.  

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

        16.        Extension
of Expiration Date. If the Company fails to cause any           Registration
Statement covering Registrable Securities (unless otherwise defined           herein,
capitalized terms in this Section 16 are as defined in the Registration           Rights
Agreement), or if event specified in Section 2(b)(ii) of the Registration
          Rights Agreement occurs, and the Blockage Period (whether alone, or in
          combination with any other Blockage Period) continues for more than 60 days in
          any 12 month period, or for more than a total of 90 days, then the Expiration
          Date of this Warrant shall be extended one day for each day beyond the 60-day
or           90-day limits, as the case may be, that the Blockage Period continues.  

        17.        Miscellaneous.  

	 	        (a)              This
Warrant shall be binding on and inure to the benefit of the parties hereto           and
their respective successors and assigns. Subject to the preceding sentence,
          nothing in this Warrant shall be construed to give to any Person other than the
          Company and the Holder any legal or equitable right, remedy or cause of action
          under this Warrant. This Warrant may be amended only in writing signed by the
          Company and the Holder and their successors and assigns.  

9 

	 	        (b)              All
questions concerning the construction, validity, enforcement and           interpretation
of this Warrant shall be governed by and construed and enforced           in accordance
with the internal laws of the State of New York (except for           matters governed by
corporate law in the State of Delaware), without regard to           the principles of
conflicts of law thereof. Each party agrees that all legal           proceedings
concerning the interpretations, enforcement and defense of this           Warrant and the
transactions herein contemplated           (“Proceedings”) (whether
brought against a party hereto or its           respective Affiliates, employees or
agents) shall be commenced exclusively in           the New York Courts. Each party
hereto hereby irrevocably submits to the           exclusive jurisdiction of the New York
Courts for the adjudication of any           dispute hereunder or in connection herewith
or with any transaction contemplated           hereby or discussed herein, and hereby
irrevocably waives, and agrees not to           assert in any Proceeding, any claim that
it is not personally subject to the           jurisdiction of any New York Court, or that
such Proceeding has been commenced           in an improper or inconvenient forum. Each
party hereto hereby irrevocably           waives personal service of process and consents
to process being served in any           such Proceeding by mailing a copy thereof via
registered or certified mail or           overnight delivery (with evidence of delivery)
to such party at the address in           effect for notices to it under this Warrant and
agrees that such service shall           constitute good and sufficient service of
process and notice thereof. Nothing           contained herein shall be deemed to limit
in any way any right to serve process           in any manner permitted by law. Each
party hereto hereby irrevocably waives, to           the fullest extent permitted by
applicable law, any and all right to trial by           jury in any legal proceeding
arising out of or relating to this Warrant or the           transactions contemplated
hereby. If either party shall commence a Proceeding to           enforce any provisions
of this Warrant, then the prevailing party in such           Proceeding shall be
reimbursed by the other party for its attorney’s fees           and other costs and
expenses incurred with the investigation, preparation and           prosecution of such
Proceeding.  

	 	        (c)              The
headings herein are for convenience only, do not constitute a part of this
          Warrant and shall not be deemed to limit or affect any of the provisions
hereof.  

	 	        (d)              In
case any one or more of the provisions of this Warrant shall be invalid,
          illegal or unenforceable in any respect, the validity, legality and
          enforceability of the remaining terms and provisions of this Warrant shall not
          in any way be affected or impaired thereby and the parties will attempt in good
          faith to agree upon a valid, legal and enforceable provision which shall be a
          commercially reasonable substitute therefor, and upon so agreeing, shall
          incorporate such substitute provision in this Warrant.  

	 	        (e)              Prior
to exercise of this Warrant, the Holder hereof shall not, by reason of by           being
a Holder, be entitled to any rights of a stockholder with respect to the
          Warrant Shares  

[REMAINDER OF PAGE
INTENTIONALLY LEFT BLANK,
SIGNATURE PAGE FOLLOWS] 

10 

        IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its authorized
officer as of the date first indicated above. 

		ALLIANCE PHARMACEUTICAL CORP.

		By:   	/s/  Duane Roth 

		Name:   
Title:   	Duane Roth

Chief Executive Officer

11 

EXERCISE NOTICE
ALLIANCE PHARMACEUTICAL
CORP.
WARRANT DATED [        ], 2004 

The undersigned Holder hereby
irrevocably elects to purchase _____________ shares of Common Stock pursuant to the above
referenced Warrant. Capitalized terms used herein and not otherwise defined have the
respective meanings set forth in the Warrant.  

(1)              The
undersigned Holder hereby exercises its right to purchase _________________
          Warrant Shares pursuant to the Warrant.  

(2)              The
holder shall pay the sum of $____________ to the Company in accordance with           the
terms of the Warrant.  

(3)              Pursuant
to this Exercise Notice, the Company shall deliver to the holder
          _______________ Warrant Shares in accordance with the terms of the Warrant.  

		Name of Holder:

	Dated: ______________,______	(Print)  	 

		
By:  	
 

		Name:  	 

		Title:  	 

		
(Signature  must  conform  in all  respects  to  name of holder 

as specified on the face of the Warrant)

12 

ALLIANCE PHARMACEUTICAL
CORP.
WARRANT DATED [        ], 2004 

NET ISSUE ELECTION
NOTICE 

To: [Name]  

Date: [_________________________]  

        The
undersigned hereby elects under Section 14 of this Warrant to surrender the right
to purchase [____________] shares of Common Stock pursuant to this Warrant and hereby
requests the issuance of [_____________] shares of Common Stock. The certificate(s) for
the shares issuable upon such net issue election shall be issued in the name of the
undersigned or as otherwise indicated below. 

_________________________________________

Signature 

_________________________________________

Name for Registration 

_________________________________________

Mailing Address 

13 

Warrant Shares
Exercise Log 

				
	Date	Number of Warrant Shares	Number of Warrant	Number of Warrant
		Available to be Exercised	Shares Exercised	Shares Remaining to
				be Exercised
	
	
	
	

				

14 

ALLIANCE PHARMACEUTICAL
CORP.
WARRANT ORIGINALLY
ISSUED [        ], 2004
WARRANT NO. [   ] 

FORM OF ASSIGNMENT 

        [To
be completed and signed only upon transfer of Warrant] 

        FOR VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers unto
________________________________ the right represented by the above-captioned Warrant to
purchase ____________ shares of Common Stock to which such Warrant relates and appoints
________________ attorney to transfer said right on the books of the Company with full
power of substitution in the premises. 

Dated: _______________, ____  

	 	
_______________________________________
(Signature  must  conform in all
respects to name of 
holder as specified on the face of the Warrant)

	 	
_______________________________________
Address of Transferee

	 	
_______________________________________

	 	
_______________________________________

In the presence of: 

__________________________ 

15THESE 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.

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