(ii) welfare benefit plans, practices, policies and programs

 EXHIBIT 10.4

                          EMPLOYMENT AGREEMENT--TIM J. TONEY

               This   Employment   Agreement  ("Agreement")  between  Akorn
          Manufacturing, Inc., an Illinois corporation (the "Company"), and
          Tim J. Toney (the "Employee") is dated as of January 1, 1996 (the
          "Agreement Date").

               WHEREAS, Employee currently is employed by the Company;

               WHEREAS, the Company  desires  to  retain  the  services  of
          Employee  pursuant  to  the  terms of this Agreement and Employee
          desires to continue in the service of the Company on such terms;

               NOW, THEREFORE, for and in  consideration  of  the continued
          employment of Employee by the Company and the payment  of  wages,
          salary  and  other  compensation  to Employee by the Company, the
          parties hereto agree as follows:

          Section 1.Employment Capacity and Term

               1.1  Capacity  and  Duties  of Employee.   The  Employee  is
          employed  by the Company to render  services  on  behalf  of  the
          Company as  Vice  President  Manufacturing  Operations.   In that
          capacity  the  Employee shall perform such duties as are assigned
          to the individual  holding any such title by the Company's Bylaws
          and such other duties,  consistent with the Employee's job title,
          as may be prescribed from  time to time by the Board of Directors
          of the Company (the "Board").

               1.2  Employment Term.   The  term  of  this  Agreement  (the
          "Employment Term") shall commence on the Agreement Date and shall
          continue until and terminate one year after either the Company or
          the  Employee  has  notified the other of such termination of the
          Employment Term; and  provided, further, that the Employment Term
          is subject to extension as provided in Section 5.2 and Employee's
          status as an employee is  subject  to  earlier termination to the
          extent provided in this Agreement.

               1.3  Devotion to Responsibilities.   During  the  Employment
          Term, the Employee shall devote all of his business time  to  the
          business  of  the  Company  and  its  subsidiaries and affiliated
          companies,  shall  use  his reasonable best  efforts  to  perform
          faithfully and efficiently  his  duties under this Agreement, and
          shall  not  engage  in  or be employed  by  any  other  business;
          provided, however, that nothing  contained  herein shall prohibit
          the  Employee  from  (a) serving  as  a member of  the  board  of
          directors, board of trustees or the like  of  any  for-profit  or
          non-profit  entity  that  does  not  compete with the Company, or
          performing  services  of  any  type for any  civic  or  community
          entity,  whether  or  not  the  Employee   receives  compensation
          therefor,  (b) investing  his assets in such form  or  manner  as
          shall require no more than  nominal  services  on the part of the
          Employee in the operation of the business of or property in which
          such  investment  is  made, or (c) serving in various  capacities
          with, and attending meetings  of,  industry  or  trade groups and
          associations,   as  long  as  the  Employee's  engaging  in   any
          activities permitted  by virtue of clauses (a), (b) and (c) above
          does not materially interfere with the ability of the Employee to
          perform the services and  discharge the responsibilities required
          of him under this Agreement.   Notwithstanding  clause (b) above,
          during  the Employment Term, the Employee shall not  perform  any
          services  for  and shall not beneficially own more than 2% of the
          equity interests  of  a  business organization that competes with
          the Company or its affiliates.   For  purposes of this paragraph,
          "beneficially own" shall have the meaning  given  to that term in
          Rule  13d-3  under  the  Securities  Exchange  Act  of 1934  (the
          "Exchange Act").

          Section 2. Compensation and Benefits

               During  the  Employment Term, the Company shall provide  the
          Employee with the compensation and benefits described below:

               2.1  Salary.   A  salary  ("Base  Salary")  at  the  rate of
          $120,000 per year; provided, however, that Employee's Base Salary
          shall increase as of each anniversary of the Agreement Date  by a
          factor  equal  to  the  increase  in  the  Consumer  Price  Index
          maintained  by the United States Department of Labor.  Employee's
          Base Salary shall be payable to the Employee at such intervals as
          the salaries of other salaried employees of the Company are paid.
          Any increase  in Employee's Base Salary shall take effect for the
          payroll period  next following the date on which the condition to
          such increase is met.

               2.2  Bonus.  Employee  shall  be  eligible  to  receive such
          bonuses   and   supplementary   compensation  as  the  Board  may
          determine.

               2.3  Benefits.  The Company  shall provide the Employee and,
          if applicable, his family members,  with  all such (i) incentive,
          savings and retirement plans, practices, policies  and  programs,
          (ii)  welfare  benefit  plans,  practices,  policies and programs
          (including,  without  limitation, medical, prescription,  dental,
          disability, employee life, group life, accident health and travel
          accident insurance plans  and  programs)  and (iii) paid vacation
          and  other  fringe  benefits,  plans,  practices,   policies  and
          programs  as are applicable generally to other peer employees  of
          the Company.

               2.4  Office  and  Support Staff.  Employee shall be entitled
          to an office or offices  of  the  size  and  with furnishings and
          other  appointments,  and  to  personal  secretarial   and  other
          assistance,  at least equal to the those provided to him  on  the
          Agreement Date.

               2.5  Expenses.    The   Employee  shall  be  reimbursed  for
          reasonable out-of-pocket expenses  incurred  from time to time on
          behalf of the Company or any affiliate in the  performance of his
          duties  under  this  Agreement,  upon  the presentation  of  such
          supporting  invoices,  documents  and  forms   as   the   Company
          reasonably requests.

          Section 3. Termination of Employment

               3.1  Death.   The  Employee's  status  as  an employee shall
          terminate immediately and automatically upon the Employee's death
          during the Employment Term.

               3.2  Disability.  The Employee's status as an  employee  may
          be terminated for "Disability" as follows:

                    (a)  The   Employee's   status  as  an  employee  shall
          terminate if the Employee has a disability that would entitle him
          to  receive  benefits  under the Company's  long-term  disability
          insurance policy in effect  at  the  time  either  because  he is
          Totally Disabled or Partially Disabled, as such terms are defined
          in the Company's policy in effect as of the Agreement Date or  as
          similar  terms  are  defined  in  any successor policy.  Any such
          termination shall become effective  on the first day on which the
          Employee is eligible to receive payments under such policy (or on
          the first day that he would be so eligible,  if  he  had  applied
          timely for such payments).

                    (b)  If the Company has no long-term disability plan in
          effect,  the Employee's status as an employee shall terminate  if
          (i) the Employee  is  rendered  incapable  because of physical or
          mental  illness  of  satisfactorily discharging  his  duties  and
          responsibilities  under   this  Agreement  for  a  period  of  90
          consecutive days and (ii) a  duly  qualified  physician chosen by
          the  Company  and  acceptable  to  the  Employee  or  his   legal
          representative so certifies in writing, the Board shall have  the
          power to determine that the Employee has become disabled.  If the
          Board  makes  such  a  determination,  the Company shall have the
          continuing  right  and  option,  during  the   period  that  such
          disability continues, and by notice given in the  manner provided
          in  this  Agreement,  to terminate the status of Employee  as  an
          employee.  Any such termination  shall  become  effective 30 days
          after such notice of termination is given, unless within such 30-
          day period, the Employee becomes capable of rendering services of
          the character contemplated hereby (and a physician  chosen by the
          Company   and   acceptable   to   the   Employee   or  his  legal
          representative so certifies in writing) and the Employee  in fact
          resumes such services.

                    (c)  The  "Disability  Effective  Date"  shall mean the
          date on which termination of employment becomes effective  due to
          Disability.

               3.3  Cause.  The Company may terminate the Employee's status
          as  an  employee  for  Cause.  As used herein, termination by the
          Company of the Employee's status as an employee for "Cause" shall
          mean termination as a result of (a) the Employee's breach of this
          Agreement, or (b) the willful  engaging  by the Employee in gross
          misconduct injurious to the Company, which  in either case is not
          remedied within 10 days after the Company provides written notice
          to the Employee of such breach or willful misconduct.

               3.4  Good Reason.  The Employee may terminate  his status as
          an  employee  for  Good  Reason.  As used herein, the term  "Good
          Reason" shall mean:

                    (a)  The occurrence of any  of the following during the
          Employment Term:

                         (i)  the  assignment  by  the   Board  or  by  any
          authorized   person   to   the   Employee   of   any  duties   or
          responsibilities   that  are  inconsistent  with  the  Employee's
          status,  title  and  position  as  Vice  President  Manufacturing
          Operations;

                         (ii) any  removal  of  the  Employee  from, or any
          failure to reappoint or reelect the Employee to, the position  of
          Vice President Manufacturing Operations of the Company, except in
          connection with a termination of Employee's status as an employee
          as permitted by this Agreement;

                         (iii)   the Company's requiring the Employee to be
          based anywhere other than  at or within 50 miles of the Company's
          principal offices in Decatur, Illinois except for required travel
          in the ordinary course of the Company's business;

                    (b)  any breach of  this  Agreement by the Company that
          continues for a period of 10 days after written notice thereof is
          given by the Employee to the Company;

                    (c)  the  failure  by  the  Company   to   obtain   the
          assumption  of  its  obligations  under  this  Agreement  by  any
          successor or assignee as contemplated by Section 6.1(c); or

                    (d)  any  purported  termination  by the Company of the
          Employee's status as an employee for Cause that  is  not effected
          pursuant  to  a Notice of Termination satisfying the requirements
          of this Agreement.

               3.5  Voluntary  Termination  by the Company.  Subject to the
          terms and conditions provided herein,  the  Company may terminate
          the Employee's status as an employee during the  Employment  Term
          for reasons other than death, Disability or Cause.

               3.6  Voluntary  Termination by the Employee.  Subject to the
          terms and conditions provided  herein, the Employee may terminate
          the Employee's status as an employee  during  the Employment Term
          for reasons other than Good Reason.

               3.7  Notice of Termination.  Any termination  by the Company
          for  Disability  or  Cause,  or by the Employee for Good  Reason,
          shall be communicated by Notice of Termination to the other party
          hereto given in accordance with  Section  6.2.   For  purposes of
          this Agreement, a "Notice of Termination" means a written  notice
          that  (a)  indicates  the  specific termination provision in this
          Agreement relied upon, (b) to  the  extent applicable, sets forth
          in  reasonable  detail  the  facts and circumstances  claimed  to
          provide  a basis for termination  of  the  Employee's  employment
          under the  provisions  so  indicated  and  (c)  if  the  Date  of
          Termination  (as defined below) is other than the date of receipt
          of such notice,  specifies the termination date (which date shall
          be not more than 30  days  after the giving of such notice).  The
          failure by the Employee or the Company to set forth in the Notice
          of Termination any fact or circumstance  that  contributes  to  a
          showing  of Good Reason, Disability or Cause shall not negate the
          effect of  the  notice nor waive any right of the Employee or the
          Company, respectively,  hereunder or preclude the Employee or the
          Company, respectively, from  asserting  such fact or circumstance
          in enforcing the Employee's or the Company's rights hereunder.

               3.8  Date of Termination.  "Date of  Termination"  means (a)
          if Employee's employment is terminated by reason of his death  or
          Disability, the Date of Termination shall be the date of death of
          Employee  or  the  Disability Effective Date, as the case may be,
          (b) if Employee's employment  is  terminated  by  the Company for
          Cause,  or by Employee for Good Reason, the date of  delivery  of
          the Notice  of  Termination  or any later date specified therein,
          (which date shall not be more  than  30  days after the giving of
          such notice) as the case may be, (c) if the Employee's employment
          is terminated by the Company prior to the  end  of the Employment
          Term for reasons other than death, Disability or  Cause, the Date
          of  Termination  shall be the date on which the Company  notifies
          the  Employee  of  such   termination,   (d) if   the  Employee's
          employment is terminated by the Employee prior to the  end of the
          Employment Term for reasons other than Good Reason, the  Date  of
          Termination  shall be the date on which the Employee notifies the
          Company of such  termination,  and  (e)  if  the  Employment Term
          terminates upon notice by the Company or the Employee as provided
          for in Section 1.2 or Section 5.2, the Date of Termination  shall
          be the date on which the Employment Term ends.

          Section 4. Obligations Upon Termination

               4.1  Death.    If   Employee's  status  as  an  employee  is
          terminated by reason of Employee's  death,  this  Agreement shall
          terminate   without  further  obligations  to  Employee's   legal
          representatives  under  this Agreement, other than the obligation
          to  make any payments due  pursuant  to  employee  benefit  plans
          maintained by the Company or its affiliates.

               4.2  Disability.   If  Employee's  status  as an employee is
          terminated  by  reason  of Employee's Disability, this  Agreement
          shall terminate without further  obligation  to  Employee,  other
          than the obligation to make any payments due pursuant to employee
          benefit plans maintained by the Company or its affiliates.

               4.3  Termination  by  Company  for Reasons other than Death,
          Disability or Cause; Termination by Employee for Good Reason.  If
          the Company terminates the Employee's status as an employee prior
          to the end of the Employment Term for  reasons  other than death,
          Disability  or  Cause, or the Employee terminates his  employment
          prior to the end of the Employment Term for Good Reason, then

                    (a)  within  30  days  of  the  Date of Termination the
          Company shall pay to the Employee in a lump  sum  an amount equal
          to  the Employee's Base Salary through the end of the  Employment
          Term  had the notice contemplated by Section 1.2 been given as of
          the Date of Termination; and

                    (b)  the  amount  of  any  performance-based  bonus  or
          options  granted to the Employee shall be deemed to be the amount
          to which the  Employee  would  have been entitled if the budgeted
          goals or other performance goals  applicable thereto had been met
          but not exceeded and, whether or not  the  performance goals have
          been  met  as  of the Date of Termination, such  bonus  shall  be
          payable within 30  days  of  the  Date  of  Termination  and such
          options (if not already exercisable) shall become exercisable  as
          of  the  Date  of  Termination  and  shall  expire on the date of
          expiration  of the options as provided in the  applicable  option
          agreement.

               4.4  Termination for Cause, Without Good Reason or at End of
          Employment Term.   This Agreement shall terminate without further
          obligation to the Employee  other than obligations imposed by law
          and obligations imposed pursuant  to  any  employee  benefit plan
          maintained by the Company or its affiliates (a) if the Employee's
          status as an Employee is terminated by the Company for  Cause  or
          by the Employee for reasons other than Good Reason or (b), except
          as  otherwise  provided  in  Section  5.2,  at  the  end  of  the
          Employment  Term.  If the Company or the Employee gives notice of
          termination of  the  Employment  Term  as provided for in Section
          1.2, the Company may, at its option, terminate  Employee's status
          as an employee, in which case such termination shall  be deemed a
          termination  by  the  Company  without Cause for purposes of  all
          provisions of this Agreement.

               4.5  Resignation as Director.   If Employee is a director of
          the Company and his employment is terminated for any reason other
          than  death,  the Employee shall, if requested  by  the  Company,
          immediately resign  as  a  director  of  the  Company.   If  such
          resignation is not received when so requested, the Employee shall
          forfeit  any  right  to  receive  any  payments  pursuant to this
          Agreement.

               4.6  Accrued   Obligations   and   Other   Benefits.    Upon
          termination  of employment for any reason the Employee  shall  be
          entitled to receive  promptly,  and  in  addition  to  any  other
          benefits  specifically  provided,  (a) the Employee's Base Salary
          through  the Date of Termination to the  extent  not  theretofore
          paid, (b) any accrued vacation pay, to the extent not theretofore
          paid, and  (c)  any other amounts or benefits required to be paid
          or provided or which  the  Employee  is entitled to receive under
          any plan, program, policy practice or agreement of the Company.

               4.7  Stock Options.  The foregoing  benefits are intended to
          be  in  addition to the value of any options  to  acquire  common
          stock of  Akorn  the  exercisability  of which may be accelerated
          pursuant  to the terms of any stock option,  incentive  or  other
          similar plan heretofore or hereafter adopted by Akorn.

          Section 5. Change of Control

               5.1  Definitions.   For  purposes  of  this  Section  5, the
          following terms shall have the meanings indicated below.

                    (a)  Company.   In  the  event  of  any  assignment  or
          succession  as described in Section 6.1(c), the term "Company" as
          used in this  Agreement  shall  refer  also  to such successor or
          assignee.   As  used in Section 5.1(b) the term  "Company"  shall
          refer to Akorn and  shall not refer to Akorn Manufacturing, Inc.,
          except as otherwise indicated.
                    
                    (b)  Change  of  Control.   A "Change of Control" shall
          mean the occurrence of any of the following events:

                         (i)  the acquisition by  any individual, entity or
          "person" (within the meaning of Section 13(d)(3)  or  14(d)(2) of
          the Exchange Act) of beneficial ownership of more than 30% of the
          outstanding  shares  of the Company's common stock, no par  value
          per  share (the "Common  Stock");  provided,  however,  that  for
          purposes of this subsection (i), the following acquisitions shall
          not constitute a Change of Control:

                              (A)  any acquisition of Common Stock directly
          from the Company,

                              (B)  any  acquisition  of Common Stock by the
          Company,

                              (C)  any acquisition of  Common  Stock by any
          employee benefit plan (or related trust) sponsored or  maintained
          by the Company or any corporation controlled by the Company, or

                              (D)  any acquisition of Common Stock  by  any
          corporation  pursuant to a transaction that complies with clauses
          (A), (B) and (C) of subsection (b)(iii) of this Section 5.1; or

                         (ii) individuals  who,  as  of the Agreement Date,
          constitute the Board (the "Incumbent Board") cease for any reason
          to  constitute  at  least  a  majority  of  the Board;  provided,
          however,  that any individual becoming a director  subsequent  to
          the Agreement  Date whose election, or nomination for election by
          the Company's shareholders,  was approved by a vote of at least a
          majority of the directors then  comprising  the  Incumbent  Board
          shall  be considered a member of the Incumbent Board, unless such
          individual's  initial  assumption of office occurs as a result of
          an actual or threatened  election  contest  with  respect  to the
          election  or  removal  of directors or other actual or threatened
          solicitation of proxies  or  consents by or on behalf of a person
          other than the Incumbent Board; or

                         (iii)    the  consummation  of  a  reorganization,
          merger or consolidation, or sale  or  other disposition of all or
          substantially  all  of  the assets of the  Company  (a  "Business
          Combination"), in any such  case, unless, following such Business
          Combination,

                              (A)  all   or   substantially   all   of  the
          individuals   and  entities  who  were  the  direct  or  indirect
          beneficial owners  of  the Company's outstanding common stock and
          voting securities entitled  to  vote generally in the election of
          directors  immediately prior to such  Business  Combination  have
          direct or indirect  beneficial  ownership,  respectively, of more
          than 50% of the then outstanding shares of common stock, and more
          than  50%  of the combined voting power of the  then  outstanding
          voting securities  entitled  to vote generally in the election of
          directors,  of  the  corporation  resulting  from  such  Business
          Combination  (which, for  purposes  of  this  paragraph  (A)  and
          paragraphs (B)  and  (C),  shall include a corporation which as a
          result  of  such  transaction controls  the  Company  or  all  or
          substantially all of  the  Company's  assets  either  directly or
          through one or more subsidiaries), and

                              (B)  except to the extent that such ownership
          existed  prior  to the Business Combination, no person (excluding
          any corporation resulting  from  such Business Combination or any
          employee benefit plan or related trust  of  the  Company  or such
          corporation    resulting    from   such   Business   Combination)
          beneficially owns, directly or  indirectly,  20%  or  more of the
          then  outstanding  shares  of  common  stock  of  the corporation
          resulting from such Business Combination or 20% or  more  of  the
          combined  voting  power of the then outstanding voting securities
          of such corporation, and

                              (C)  at  least  a  majority of the members of
          the  board of directors of the corporation  resulting  from  such
          Business  Combination  were  members of the board of directors of
          the  Company  at the time of the  initial  action  of  the  Board
          providing for such Business Combination;

                         (iv)   approval by the shareholders of the Company
          of a complete liquidation or dissolution of the Company or;

                         (v)  the  consummation of a reorganization, merger
          or  consolidation,  sale  or   other   disposition   of   all  or
          substantially  all  of  the  assets,  or  sale, transfer or other
          distribution of more than 50% of the shares  of  common  stock of
          Akorn Manufacturing, Inc. or of the voting securities entitled to
          vote  in  the  election  of  directors thereof, in any such case,
          unless, following such transaction,  at  least  a majority of the
          members of the Board of Directors of Akorn Manufacturing, Inc. or
          other corporation resulting from such transaction were members of
          the  Board of Directors of Akorn Manufacturing, Inc.  or  of  the
          Company  at  the  time  of  the  initial  action  of the Board of
          Directors   of  Akorn  Manufacturing,  Inc.  or  of  the  Company
          providing for such transaction.

                    (c)  Affiliate.   The  term  "affiliate" or "affiliated
          companies" shall mean any company or other  entity controlled by,
          controlling, or under common control with, the Company.

                    (d)  Cause.   After  a Change of Control,  "Cause,"  as
          used in this Agreement, shall have  the following meaning and not
          the meaning given in Section 3.3:

                         (i)  the  willful  and continued  failure  of  the
          Employee to perform substantially the Employee's duties hereunder
          (other than any such failure resulting  from  incapacity  due  to
          physical   or   mental  illness),  after  a  written  demand  for
          substantial performance is delivered to the Employee by the Board
          of the Company which  specifically identifies the manner in which
          the  Board  believes that  the  Employee  has  not  substantially
          performed the Employee's duties, or

                         (ii) the  willful  engaging  by  the  Employee  in
          illegal  conduct  or  gross  misconduct  which  is materially and
          demonstrably injurious to the Company or its affiliates.

          For purposes of this provision, no act or failure  to act, on the
          part of the Employee, shall be considered "willful"  unless it is
          done,  or  omitted  to  be done, by the Employee in bad faith  or
          without reasonable belief  that the Employee's action or omission
          was in the best interests of  the Company or its affiliates.  Any
          act, or failure to act, based upon  authority given pursuant to a
          resolution duly adopted by the Board  or upon the instructions of
          a  senior  officer of the Company or based  upon  the  advice  of
          counsel for  the  Company or its affiliates shall be conclusively
          presumed to be done,  or  omitted  to be done, by the Employee in
          good  faith  and in the best interests  of  the  Company  or  its
          affiliates.  The  cessation  of  employment of the Employee shall
          not be deemed to be for Cause unless  and  until there shall have
          been  delivered  to  the  Employee  a  copy of a resolution  duly
          adopted by the affirmative vote of not less  than  three-quarters
          of the entire membership of the Board at a meeting of  the  Board
          called  and  held  for  such  purpose (after reasonable notice is
          provided  to  the  Employee  and  the   Employee   is   given  an
          opportunity,  together  with  counsel,  to  be  heard  before the
          Board), finding that, in the good faith opinion of the Board, the
          Employee has engaged in the conduct described in subparagraph (i)
          or (ii) above, and specifying the particulars thereof in detail.

                    (e)  Good  Reason.   After  a Change of Control,  "Good
          Reason,"  as  used in this Agreement, shall  have  the  following
          meaning and not the meaning given in Section 3.4:

                         (i)  Any  failure of the Company or its affiliates
          to provide the Employee with  the position, authority, duties and
          responsibilities at least equivalent  in  all  material  respects
          with  the  most significant of those held, exercised and assigned
          at any time  during  the 120-day period immediately preceding the
          Change of Control;

                         (ii) The  assignment to the Employee of any duties
          inconsistent in any respect  with  Employee's position (including
          status, offices, titles and reporting  requirements),  authority,
          duties or responsibilities as contemplated by Section 1.1, or any
          other  action  that  results  in  a  diminution in such position,
          authority, duties or responsibilities, excluding for this purpose
          an isolated, insubstantial and inadvertent  action  not  taken in
          bad  faith  that  is  remedied  within  10  days after receipt of
          written notice thereof from the Employee to the Company;

                         (iii)    Any  failure  by  the  Company   or   its
          affiliates  to  comply  with   any  of  the  provisions  of  this
          Agreement, other than an isolated,  insubstantial and inadvertent
          failure not occurring in bad faith that  is  remedied  within  10
          days after receipt of written notice thereof from the Employee to
          the Company;

                         (iv)   The Company or its affiliates requiring the
          Employee to be based at  any  office  or  location  other than as
          provided in Section 3.4(a)(iii) hereof or requiring the  Employee
          to  travel  on  business  to  a substantially greater extent than
          required immediately prior to the Change of Control;
                         (v)   Any purported  termination of the Employee's
          employment  otherwise  than  as  expressly   permitted   by  this
          Agreement; or

                         (vi) Any failure by the Company to comply with and
          satisfy Sections 6.1(c) and (d) of this Agreement.

          For  purposes of this Section 5, any good faith determination  of
          "Good Reason" made by the Employee shall be conclusive.  Anything
          in this  Agreement to the contrary notwithstanding, a termination
          by  the  Employee   for  any  reason  during  the  30-day  period
          immediately following  the  first  anniversary  of  the Change of
          Control shall be deemed to be a termination for Good Reason.

                    (f)    Beneficial  Ownership.   The  terms  "beneficial
          ownership," "beneficial  owner," "beneficially owns," and similar
          terms shall have the meanings  set  forth in Rule 13d-3 under the
          Exchange Act.

               5.2   Employment Capacity and Term  after Change of Control.
          (a) If a Change of Control occurs during the Employment Term, the
          Employee's Employment Term (the "Modified Employment Term") shall
          be extended until and terminate at the close  of  business on the
          later to occur of the second anniversary of the Change of Control
          or the date one year after the date on which either  the  Company
          or  the Employee has notified the other of such termination;  and
          provided,  further,  that  Employee's  status  as  an employee is
          subject  to  earlier termination to the extent provided  in  this
          Agreement.

                    (b)  After  a Change of Control and during the Modified
          Employment Term, (i) the  Employee's  position (including status,
          offices,  titles and reporting requirements),  authority,  duties
          and responsibilities  in and with respect to the Company shall be
          at  least  equivalent  in  all  material  respects  to  the  most
          significant of those held,  exercised  and  assigned  at any time
          during  the  120-day  period immediately preceding the Change  of
          Control and (ii) the Employee's service shall be performed at the
          location where the Employee  was  employed  immediately preceding
          the  Change  of Control or any office or location  less  than  50
          miles from such location.

               5.3  Compensation   and   Benefits.    During  the  Modified
          Employment  Term,  in addition to the compensation  and  benefits
          described in Section  2,  the  Employee  shall be entitled to the
          following compensation and benefits:

                    (a)  Salary.   During  the  Modified  Employment  Term,
          Employee's Base Salary shall be as provided for in Section 2.1.

                    (b)  Benefit  Plans.   During the  Modified  Employment
          Term, the Employee and his family,  if  any, shall be entitled to
          participate in and receive applicable benefits under all such (i)
          incentive, savings and retirement plans,  practices, policies and
          programs,  (ii)  welfare benefit plans, practices,  policies  and
          programs (including,  without  limitation, medical, prescription,
          dental, disability, employee life,  group life, accidental health
          and travel accident insurance plans and  programs) and (iii) paid
          vacation  and other fringe benefits, plans,  practices,  policies
          and programs  as are applicable generally to other peer employees
          of the Company  and  its affiliated companies in effect generally
          after  the  Change  of Control  or,  if  more  favorable  to  the
          Employee, as in effect  for  the  Employee at any time during the
          120-day period immediately preceding the Change of Control.

                    (c)  Expenses.  During the  Modified  Employment  Term,
          the  Employee  shall  be entitled to receive prompt reimbursement
          for  all  reasonable  expenses   incurred   by  the  Employee  in
          accordance  with  the  most  favorable  policies,  practices  and
          procedures of the Company and its affiliated  companies in effect
          generally after the Change of Control with respect  to other peer
          employees of the Company and its affiliated companies or, if more
          favorable to the Employee, as in effect for the Employee  at  any
          time  during  the 120-day period immediately preceding the Change
          of Control.

                    (d)  Office  and  Support  Staff.   During the Modified
          Employment Term, the Employee shall be entitled  to  an office or
          offices  of  a  size and with furnishings and other appointments,
          and to personal secretarial  and other assistance, at least equal
          to the most favorable of the foregoing  provided  generally after
          the Change of Control with respect to other peer employees of the
          Company and its affiliated companies or, if more favorable to the
          Employee,  as in effect for the Employee at any time  during  the
          120-day period immediately preceding the Change of Control.

               5.4  Termination  of  Employment  after a Change of Control.
          After  a  Change  of Control and during the  Modified  Employment
          Term, the Employee's status as an employee shall terminate or may
          be  terminated  as provided  in  Section  3  of  this  Agreement;
          provided, however,  that after a Change of Control and during the
          Modified Employment Term  the terms "Cause" and "Good Reason," as
          used in Section 3 and elsewhere in this Agreement, shall have the
          meanings given to them in this  Section  5  and  not the meanings
          given to them in Section 3.

               5.5  Obligations  of  the Company upon Termination  after  a
          Change of Control.  (a) If,  after  a Change of Control and prior
          to  the  end  of   the  Modified  Employment  Term,  the  Company
          terminates the Employee's employment  other than for Cause, death
          or  Disability, or the Employee terminates  employment  for  Good
          Reason, then

                          (i) within 30 days of the Date of Termination the
          Company  shall  pay to the Employee in a lump sum an amount equal
          to the Employee's  Base  Salary  through  the end of the Modified
          Employment Term had such termination not occurred; and

                         (ii) Employee shall be entitled  to  the  benefits
          provided  in Section 4.3(b) and the amounts, if any, contemplated
          by Sections 4.6 and 4.7.

                    (b)  If, after a Change of Control and prior to the end
          of the Modified  Employment  Term,  the  Employee's employment is
          terminated (i) for death, (ii) for Disability  or (iii) for Cause
          (as defined in this Section 5), by the Employee for reasons other
          than Good Reason (as defined in this Section 5)  or at the end of
          the Modified Employment Term, then the Employee shall be entitled
          to the benefits described in Section 4.1, Section  4.2 or Section
          4.4,  as  the case may be, and shall be entitled to the  benefits
          described in  Sections  4.6  and  4.7.   If  the  Company  or the
          Employee  gives  notice of termination of the Modified Employment
          Term as provided for  in  Section  5.2,  the  Company may, at its
          option, terminate Employee's status as an Employee, in which case
          such termination shall be deemed a termination  without Cause for
          purposes of all provisions of this Agreement.

                    (c)  The  rights  and  obligations of the  Company  and
          Employee  contained in Section 4.5  ("Resignation  as  Director")
          shall continue to apply after a Change of Control.

               5.6  Certain  Additional  Payments.   If  after  a Change of
          Control Employee is subjected to an excise tax as a result of the
          "excess  parachute  payment"  provisions  of section 4999 of  the
          Internal Revenue Code of 1986, as amended,  whether  by virtue of
          the benefits of this Agreement or by virtue of any other benefits
          provided  to  Employee  in  connection  with  a Change of Control
          pursuant to Company plans, policies or agreements  (including the
          value of any options to acquire Common Stock of the  Company  the
          exercisability  of  which is accelerated pursuant to the terms of
          any  stock  option,  incentive  or  similar  plan  heretofore  or
          hereafter adopted by the  Company),  the  Company  shall  pay  to
          Employee  (whether  or  not  his  employment has terminated) such
          amounts as are necessary to place Employee  in  the same position
          after payment of federal income and excise taxes  and  state  and
          local  income  taxes as he would have been if such provisions had
          not been applicable to him.

          Section 6. Miscellaneous

               6.1  Binding Effect.

                    (a)  This  Agreement shall be binding upon and inure to
          the benefit of the Company and any of its successors or assigns.

                    (b)  This Agreement  is  personal  to  the Employee and
          shall  not be assignable by the Employee without the  consent  of
          the Company  (there  being  no  obligation  to give such consent)
          other than such rights or benefits as are transferred  by will or
          the laws of descent and distribution.

                    (c)  The  Company  shall  require  any successor to  or
          assignee  of  (whether  direct or indirect, by purchase,  merger,
          consolidation or otherwise)  all  or  substantially  all  of  the
          assets or businesses of the Company (i) to assume unconditionally
          and  expressly this Agreement and (ii) to agree to perform all of
          the obligations  under  this  Agreement in the same manner and to
          the same extent as would have been required of the Company had no
          assignment or succession occurred,  such  assumption  to  be  set
          forth  in  a writing reasonably satisfactory to the Employee.  In
          the  event  of  any  such  assignment  or  succession,  the  term
          "Company" as  used  in  this  Agreement  shall refer also to such
          successor or assign.
                    
                    (d)  The  Company  shall  require  all   entities  that
          control,  or  that  after  the  Change  of  Control will control,
          directly or indirectly, any such successor or  assignee  to agree
          to  cause  to  be  performed  all  of  the obligations under this
          Agreement in the same manner and to the same extent as would have
          been  required  of  the Company had no assignment  or  succession
          occurred, such agreement  to  be  set forth in writing reasonably
          satisfactory to the Employee.

               6.2  Notices.  All notices hereunder  must be in writing and
          shall be deemed to have given upon receipt of  delivery  by:  (a)
          personal  delivery to the designated individual, (b) certified or
          registered mail, postage prepaid, return receipt requested, (c) a
          nationally   recognized  overnight  courier  service  (against  a
          receipt therefor) or (d) facsimile transmission with confirmation
          of receipt.  All  such  notices  must  be addressed as follows or
          such other address as to which any party hereto may have notified
          the other in writing:

               If to the Company, to:

               Akorn Manufacturing, Inc.
               100 Akorn Drive
               Abita Springs, Louisiana  70420
               Attn:  President
               Facsimile transmission No. (504) 893-1257

               If to the Employee, to:
               Tim J. Toney
               2850 Virt Road
               Decatur, Illinois  62521
               Facsimile transmission No. __________

               6.3  Governing Law.  This Agreement  shall  be construed and
          enforced in accordance with and governed by the internal  laws of
          the State of Louisiana.

               6.4  Withholding.  The Employee agrees that the Company  has
          the  right to withhold, from the amounts payable pursuant to this
          Agreement,  all  amounts required to be withheld under applicable
          income and/or employment  tax  laws,  or  as  otherwise stated in
          documents granting rights that are affected by this Agreement.

               6.5  Severability.  If any term or provision  of this Agree-
          ment  or  the  application thereof to any person or circumstance,
          shall at any time  or  to  any  extent  be  invalid,  illegal  or
          unenforceable in any respect as written, Employee and the Company
          intend for any court construing this Agreement to modify or limit
          such provision temporally, spatially or otherwise so as to render
          it  valid  and  enforceable to the fullest extent allowed by law.
          Any such provision  that  is  not susceptible of such reformation
          shall be ignored so as to not affect  any other term or provision
          hereof, and the remainder of this Agreement,  or  the application
          of such term or provision to persons or circumstances  other than
          those  as  to which it is held invalid, illegal or unenforceable,
          shall not be affected thereby and each term and provision of this
          Agreement shall  be  valid  and  enforced  to  the fullest extent
          permitted by law.

               6.6  Waiver  of  Breach.  The waiver by either  party  of  a
          breach of any provision of this Agreement shall not operate or be
          construed as a waiver of any subsequent breach thereof.

               6.7  Remedies Not  Exclusive.   No  remedy  specified herein
          shall  be  deemed  to  be  such  party's  exclusive  remedy,  and
          accordingly,  in  addition  to  all  of  the  rights and remedies
          provided for in this Agreement, the parties shall  have all other
          rights and remedies provided to them by applicable law,  rule  or
          regulation.

               6.8  Company's Reservation of Rights.  Employee acknowledges
          and  understands  that the Employee serves at the pleasure of the
          Board and that the Company has the right at any time to terminate
          Employee's status as  an employee of the Company, or to change or
          diminish his status during  the  Employment  Term, subject to the
          rights  of the Employee to claim the benefits conferred  by  this
          Agreement.

               6.9  Survival.   Following  the  Date  of  Termination, each
          party shall have the right to enforce all rights,  and  shall  be
          bound  by  all  obligations,  of  such  party that are continuing
          rights and obligations under this Agreement.

               6.10  Counterparts.  This Agreement may be executed in one or
          more  counterparts,  each  of  which shall be  deemed  to  be  an
          original but all of which together  shall  constitute one and the
          same instrument.

               IN WITNESS WHEREOF, the Company and the Employee have caused
          this Agreement to be executed as of the Agreement Date.

                                        AKORN MANUFACTURING, INC.

                                        By:  ________________________
                                                   Eric M. Wingerter
                                                       Secretary

                                        EMPLOYEE:

                                               _______________________
                                                      Tim J. Toney 

Basic Info X:

Name: (ii) welfare benefit plans, practices, policies and programs
Type: and Programs
Date: Feb. 14, 1996
Company: AKORN INC
State: Louisiana

Other info:

Date:

  • January 1 , 1996

Organization:

  • Duties of Employee
  • United States Department of Labor
  • Employment 3.1 Death
  • Notice of Termination
  • Disability Effective Date
  • Employee 's Disability
  • Employment Term for Good Reason
  • Date of Termination the Company
  • End of Employment Term
  • Company for Cause
  • Control 5.1 Definitions
  • b Change of Control
  • Board of Directors of Akorn Manufacturing , Inc.
  • Board of the Company
  • Modified Employment Term
  • Termination of Employment
  • Employee 's Base Salary
  • Change of Control Employee
  • Akorn Drive Abita Springs

Location:

  • Road Decatur
  • Illinois
  • Louisiana

Money:

  • $ 120,000

Person:

  • Eric M. Wingerter
  • Tim J. Toney

Percent:

  • 2 %
  • 30 %
  • 20 %
  • 50 %