Alliance Pharmaceutical Corp. said Thursday that all holders ofits $8 million in 10.25 percent convertible subordinated notesdue May 1996 have elected to convert the principal amountinto Alliance common stock at a conversion price of $15 pershare.

The stock (NASDAQ:ALLP) closed at $24, down 75 cents.

After the conversion, the San Diego company said it has lessthan $5 million in total liabilities, including about $1 million inlong-term debt, and current assets of more than $75 million.

Following issuance of 533,333 shares resulting from theconversion, and the company's recent public offering of 3million shares, Alliance has 18.3 million shares outstanding.

The company, which develops pharmaceutical products basedon perfluorocarbon and emulsion technologies, issued the notesin 1989 as a private placement to institutional investors.

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