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                                                                   EXHIBIT 10(a)
                                 PERRIGO COMPANY
                         MANAGEMENT INCENTIVE BONUS PLAN
                             EFFECTIVE JUNE 29, 2003

OBJECTIVES

The objective of the Perrigo Company Management Incentive Bonus (MIB) plan is
to:

         o        Motivate top management employees to create added value for
                  the company's shareholders through compensation incentives
                  that are tied to the company's operating and financial
                  performance.

         o        Reward top management employees for their contribution and the
                  overall performance of the company.

         o        Help attract and retain top management employees.

         o        Encourage cooperation among and between participants.

PARTICIPANTS

Participants must be employed in positions that are evaluated at grade 16 or
above (excluding Customer Business Managers eligible for Sales Bonus).

TOTAL COMPENSATION OBJECTIVES - TOP MANAGEMENT

The total compensation objectives for top management employees are as follows:

         o        The base pay compensation target is the median base pay rate
                  for like positions in their competitive markets.

         o        The total cash compensation target is ten percent (10%) above
                  the market median for total cash compensation for similar
                  positions in the appropriate labor market. Total cash
                  compensation includes base pay and all short-term cash
                  incentive opportunities, including MIB. Long-term incentives
                  such as stock options are not included in the cash
                  compensation objectives.

PLAN DESIGN

The Perrigo Company Management Incentive Bonus is based on Return-on-Assets and
includes the following key features:

         o        The focus on optimizing ROA is fundamental to growing and
                  accelerating our earnings per share. As a low cost producer,
                  we must maximize our profits per asset dollar.

         o        At the beginning of each fiscal year, the Compensation
                  Committee of the Board of Directors will determine the
                  corporate return on assets goal. This goal is based on a
                  comparison with similar companies in comparable industries, in
                  conjunction with establishing challenging, but reasonable,
                  expectations for the Perrigo business plan.

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         o        The MIB is a pooled fund concept. At the end of each fiscal
                  year, money will have been accrued for disbursement to
                  participants. The amount disbursed to each participant will be
                  based on the number of shares assigned to the participant and
                  the value of each share for the year (dollars in the
                  pool/total number of MIB shares).

         o        The number of shares allocated to each position will be made
                  with consideration to grade level, and the total compensation
                  objectives of the Perrigo Company.

         o        MIB payouts may be expressed as a percentage of base salary.
                  The percent of salary goal will be made in consideration of
                  the grade level for each position and the total compensation
                  objectives of the Perrigo Company. The amount disbursed to
                  each participant will be and will be calculated using the
                  percent of salary goal, multiplied by the actual ROA
                  performance for the year, multiplied by each participant's
                  base salary.

OTHER RULES

1.       Partial year participation is permitted. Employees new to an MIB level
         position will join the plan on the first day of the month nearest their
         entry date.

2.       Except as otherwise provided in paragraphs 3 below, no portion of the
         MIB is considered earned, and therefore payable, unless the participant
         is employed by Perrigo, in good standing, on the first day of the
         following fiscal year.

3.       If a participant's employment terminates during the fiscal year for:

         o        retirement at age 65 or older;

         o        retirement at age 60 or older with at least 10 years of
                  service;

         o        retirement pursuant to the participant's acceptance of early
                  retirement under an early retirement plan;

         o        permanent disability as determined by the Compensation
                  Committee; or

         o        death.

         The participant, or his or her estate in the case of death, shall be
         entitled to a pro rata portion of any MIB bonus payment for such fiscal
         year, computed to the date of such termination.

         Executive management retains the sole right to make, or not make, any
         such payments at its discretion. Reasons for not making MIB payments to
         retirees include (but are not limited to) poor performance and reason
         to believe that the former employee left Perrigo to accept full-time
         employment elsewhere or to serve in any capacity on behalf of known or
         potential competitors of the business.

4.       Exceptions to paragraphs 2 and 3 above can only be made at the sole
         discretion of the Chief Executive Officer.

5.       Extraordinary items (charges or credits) are generally excluded from
         the calculations of the plan at the discretion of the Board of
         Directors.

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6.       One hundred percent (100%) of any earned income will be paid within a
         reasonable time after the close of each fiscal year. Senior executives
         retain authority to reduce or withhold payment to any MIB participant
         reporting in their area of influence based on sub-standard performance.
         The Compensation Committee will be responsible for making this
         determination for any participant in a senior executive management
         positions.

OTHER PLAN DESIGN RATIONALE

The components of the plan have been selected with reasons detailed below:

Total depreciated assets less cash, including capitalized leases are used as a
base for measurement for ease of comparison with FORTUNE 500 or other reported
statistics on business performance. Because management should be motivated to
generate as much cash as possible and because the return on cash invested is
less than on assets, cash is excluded from the asset base on a monthly basis.

Operating Income This measure eliminates interest and other income/expenses and
income taxes from the calculation.

         Interest income or expense is excluded because it is often related to
non-operating activities such as stock buyback, option exercises, debt or equity
issues, asset sales, etc. It is also subject to interest rate fluctuations over
which management has little control.

         Income taxes are excluded because they are subject to legislative
changes over which management has little, if any control.

Average depreciated assets less cash on a monthly basis are used to ensure
continued management attention to controlling the use of assets throughout the
year rather than emphasis on year-end figures.<PAGE>
                                                                     EXHIBIT 4.1

                               FIRST AMENDMENT TO
                          REGISTRATION RIGHTS AGREEMENT

         This First Amendment to Registration Rights Agreement (this "First
Amendment") is entered into as of October 7, 2003, by and between Akorn, Inc., a
Louisiana corporation (the "Company"), and The John N. Kapoor Trust dtd 9/20/89
(the "Investor").

                                    RECITALS

         A.       The Company and the Investor entered into a Registration
Rights Agreement, dated as of July 12, 2001 (the "Original Registration Rights
Agreement"), pursuant to which the Company agreed, upon the terms and conditions
set forth in the Original Registration Rights Agreement, to provide registration
rights for Warrants (as defined in the Original Registration Rights Agreement)
and Common Stock (as defined in the Original Registration Rights Agreement)
issued to the Investor pursuant to the terms and conditions of the Original
Registration Rights Agreement to induce the Investor to loan the Company an
aggregate principal amount of $5,000,000.

         B.       The Company and AEG Partners LLC, an Illinois limited
liability company ("AEG"), entered into a Warrant and Registration Agreement,
dated as of June 18, 2003, (as amended, the "Warrant and Registration
Agreement"), pursuant to which the Company agreed, upon the terms and conditions
set forth in the Warrant and Registration Agreement, to register for sale by AEG
the shares of Common Stock (as defined in the recitals to the Warrant and
Registration Agreement) received by AEG upon exercise of the Warrants (as
defined in the recitals to the Warrant and Registration Agreement).

         C.       The Company and the Investor, Arthur S. Przybyl ("Przybyl"),
Jerry Trepel ("Trepel"), Abu Alan ("Alan"), John Sabat ("Sabat"), Neil Shanahan
("Shanahan"), Shritin Shah ("Shah"), JRJay Public Investments, LLC ("JRJay"),
Pequot Healthcare Fund, L.P. ("Pequot Healthcare"), Pequot Healthcare
Institutional Fund, L.P. ("Pequot Institutional"), Pequot Healthcare Offshore
Fund, Inc. ("Pequot Offshore"), Pequot Scout Fund, L.P. ("Pequot Scout"), Pequot
Navigator Onshore Fund, L.P. ("Pequot Navigator"), Arjun Waney ("Waney"), Jai
Waney ("J. Waney"), Arun K. Puri Living Trust ("Puri Trust"), Argent Fund
Management Ltd. ("Argent"), Kapwan Investments, LLP ("Kapwan") and Gulu Waney
("G. Waney" and, collectively with the Investor, Przybyl, Trepel, Alan, Sabat,
Shanahan, Shah, JRJay, Pequot Healthcare, Pequot Institutional, Pequot Offshore,
Pequot Scout, Pequot Navigator, Waney, J. Waney, Puri Trust, Argent and Kapwan,
referred to herein as the "Investors") entered into a Preferred Stock and Note
Purchase Agreement dated as of September 25, 2003 (the "Purchase Agreement"),
pursuant to which the Company agreed to redeem from the Investors the Senior
Debt Note (as defined in the recitals to the Purchase Agreement) in exchange for
(a) an aggregate of 257, 172 shares of the Company's Series A 6% Participating
Convertible Preferred Stock, par value $1.00 per share (the "Preferred Stock")
having the terms set forth in the Articles of Amendment to Articles of
Incorporation of the Company attached to the Purchase Agreement as Exhibit A,
(b) the Purchased Notes (as defined in the Purchase Agreement), (c) the
Preferred Stock Warrants (as defined in the recitals to the Purchase Agreement)
and (d) $6,000,000 in cash.

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         D.       The Company and the Investor have agreed to amend the Original
Registration Rights Agreement to permit the Company to include, pursuant to the
terms and conditions of the Original Registration Rights Agreement, as amended,
in any Demand Registration (as defined in the Original Registration Rights
Agreement) those securities which are not Registrable Securities (as defined in
the Original Registration Rights Agreement) issued to (i) AEG pursuant to the
Warrant and Registration Agreement and (ii) the Investors pursuant to the
Purchase Agreement.

                                    AGREEMENT

         ACCORDINGLY, in consideration of the mutual covenants and agreements
set forth herein, the parties hereby agree as follows:

         1.       Definitions. Capitalized terms not otherwise defined in this
First Amendment shall have the meanings ascribed thereto in the Original
Registration Rights Agreement.

         2.       Amendment of Section 1(d). Section 1(d) of the Original
Registration Rights Agreement is hereby amended by deleting said Section 1(d) in
its entirety and substituting in lieu thereof, the following Section 1(d):

                  (d)      Priority on Demand Registration. Except for piggyback
         rights granted pursuant to the Warrant Purchase and Registration
         Agreement dated as of June 18, 2003 by and between the Company and AEG
         Partners LLC, an Illinois limited liability company (as amended, the
         "Warrant Purchase and Registration Agreement"), and the Registration
         Rights Agreement dated as of October 7, 2003, between the Company and
         the Investor, Arthur S. Przybyl, Jerry Trepel, Abu Alan, John Sabat,
         Neil Shanahan, Shritin Shah, JRJay Public Investments, LLC, Pequot
         Healthcare Fund, L.P., Pequot Healthcare Institutional Fund, L.P.,
         Pequot Healthcare Offshore Fund, Inc., Pequot Scout Fund, L.P., Pequot
         Navigator Onshore Fund, L.P., Arjun Waney, Jai Waney, Arun K. Puri
         Living Trust, Argent Fund Management Ltd., Kapwan Investments, LLP and
         Gulu Waney (the "Investors' Agreement"), the Company will not include
         in any Demand Registration any securities which are not Registrable
         Securities without the prior written consent of the holders of a
         majority of the Registrable Securities included in such registration,
         which consent will not be unreasonably withheld. If a Demand
         Registration is an underwritten offering and the managing underwriters
         advise the Company in writing (with a copy to each holder of
         Registrable Securities requesting registration) that in their opinion
         the number of Registrable Securities, securities requested to be
         included in such registration pursuant to the Warrant Purchase and
         Registration Agreement or the Investors' Agreement and, if permitted
         hereunder, other securities requested to be included in such offering
         exceeds the number of Registrable Securities, securities requested to
         be included in such registration pursuant to the Warrant Purchase and
         Registration Agreement or the Investors' Agreement and other
         securities, if any, which can be sold therein without adversely
         affecting the marketability of the offering, the Company will include
         in such registration, prior to the inclusion of any securities which
         are not Registrable Securities, the number of Registrable Securities
         requested to be included which in the opinion of such underwriters can
         be sold without adversely

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         affecting the marketability of the offering, pro rata among the
         respective holders of the Registrable Securities that each holder of
         Registrable Securities has requested to be included in such
         registration. Any persons other than holders of Registrable Securities
         who participates in Demand Registrations which are not at the Company's
         expense must pay their share of the Registration Expenses as provided
         in paragraph 5 hereof.

         3.       Miscellaneous.

                  (a)      No Amendment of Other Terms, Conditions and
Provisions of the Original Registration Rights Agreement. Except as expressly
amended hereby, all of the terms, conditions and provisions of the Original
Registration Rights Agreement shall remain unamended and in full force and
effect in accordance with its terms, and the Original Registration Rights
Agreement, as amended hereby, is hereby ratified and confirmed. The amendments
provided herein shall be limited precisely as drafted and shall not constitute
an amendment of any other term, condition or provision of the Original
Registration Rights Agreement.

                  (b)      Entire Agreement. The Original Registration Rights
Agreement, as amended by this First Amendment, constitutes the entire agreement
and understanding between the parties relating to the subject matter hereof.

                  (c)      No Inconsistent Amendments. The Company will not
hereafter enter into any agreement with respect to its securities which is
inconsistent with or violates the rights guaranteed to the holders of
Registrable Securities in this First Amendment.

                  (d)      Remedies. The parties hereto agree and acknowledge
that money damages may not be an adequate remedy for any breach of the
provisions of this First Amendment and that any party hereto shall have the
right to injunctive relief, in addition to all of its other rights and remedies
at law or in equity, to enforce the provisions of this First Amendment.

                  (e)      Amendments and Waivers. Except as otherwise provided
herein, the provisions of this First Amendment may be amended or waived only
upon the prior written consent of the Company and the holders of sixty-six and
two-thirds percent (66 2/3%) of the Registrable Securities.

                  (f)      Successors and Assigns; Permitted Transfers. This
First Amendment shall be binding upon and inure to the benefit of and be
enforceable by the parties hereto and their respective successors and assigns;
provided, however, it is understood and agreed that the Investor may assign its
rights hereunder only to Permitted Transferees (as defined below).
Notwithstanding the provisions of this First Amendment to the contrary, it is
understood and agreed that any holder of Registrable Securities may at any time
and from time to time without restriction transfer or recertificate all or a
part of such holder's Registrable Securities (i) to a nominee identified in
writing to the Company as being the nominee of or for such holder, and any
nominee of or for a beneficial owner of Registrable Securities identified in
writing to the Company as being the nominee of or for such beneficial owner may
from time to time transfer or

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recertificate all or a part of the Registrable Securities registered in the name
of such nominee but held as nominee on behalf of such beneficial owner, to such
beneficial owner, (ii) to an affiliate of such holder, (iii) to an estate
planning trust or other vehicle established by or for the benefit of such
holder, or (iv) to the immediate family of Dr. John N. Kapoor. The transfers or
recertifications described in this Section are sometimes referred to herein
collectively as "Permitted Transfers" and the recipient of Registrable
Securities in a permitted Transfer is sometimes referred to herein as a
"Permitted Transferee".

                  (g)      Severability. Whenever possible, each provision of
this First Amendment shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this First Amendment is held
to be prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this First Amendment.

                  (h)      Counterparts. This First Amendment may be executed
simultaneously in two or more counterparts, any one of which need not contain
the signatures of more than one party, but all such counterparts taken together
shall constitute one and the same First Amendment. One or more counterparts of
this First Amendment may be delivered by facsimile, with the intention that
delivery by such means shall have the same effect as delivery of an original
counterpart thereof.

                  (i)      Descriptive Headings. The descriptive headings of
this First Amendment are inserted for convenience only and do not constitute a
part of this First Amendment.

                  (j)      Governing Law. All issues concerning this First
Amendment shall be governed by and construed in accordance with the laws of the
State of Illinois without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of Illinois or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of Illinois.

                            [Signature Page Follows]

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         IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment to Registration Rights Agreement as of the day and year first above
written.

                                    AKORN, INC.

                                    By    /s/ Bernard J. Pothast
                                          -------------------------------------
                                    Name  Bernard J. Pothast
                                    Title Senior Vice President, Chief Financial
                                          Officer, Secretary and Treasurer

                                    THE JOHN N. KAPOOR TRUST DATED
                                    SEPTEMBER 20, 1989

                                    By     /s/ John. N. Kapoor
                                           ------------------------------------
                                    Name   John N. Kapoor
                                    Title: Trustee

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