Capital Contribution Agreement

Exhibit 10.5

STRIDES CAPITAL CONTRIBUTION AGREEMENT Buffalo Grove, Illinois $1,250,000.00September 22, 2004

For value received, STRIDES ARCOLAB LIMITED, a company organized under the laws of India (" Strides" ), promises to pay to the order of AKORN-STRIDES, LLC, a Delaware limited liability company (" A-S" ), at 2500 Millbrook Drive, Buffalo Grove, Illinois 60089-4694, or at such other place as the holder of this Agreement (" Holder" ) may from time to time designate in writing, in lawful money of the United States, the principal sum of One Million Two Hundred Fifty Thousand Dollars ($1,250,000.00), or so much thereof as may be advanced, with interest and due and payable all as set forth below.

This Strides Capital Contribution Agreement (the " Agreement" ) is made pursuant to that certain " Limited Liability Company Agreement for Akorn-Strides, LLC, a Delaware Limited Liability Company," dated September 22, 2004 (the " LLC Agreement" ), and is one of the two " Strides Capital Contribution Agreements" referred to therein. Terms used with capital letters in this Agreement and not otherwise defined herein shall have the meanings set forth in the LLC Agreement. This Agreement evidences Strides' obligation to repay advances to be made by A-S to Strides as provided in Section 3.1(B)(ii) of the LLC Agreement.

ARTICLE 1. INTEREST AND PAYMENTS

1.1 Interest . This Agreement shall bear no interest.

1.2 Payments . Until this Agreement paid in full:

1.2.1 Immediately on the date of Strides' acceptance of a Purchase Order, as defined under that certain " OEM Agreement" dated September 22, 2004 (the " OEM Agreement" ), an amount equal to thirty five percent (35%) of the invoice amount for such Purchase Order (" Agreement Repayment Amount" ) shall become due and payable under this Agreement. Strides shall immediately, in each case, (i) apply thirty five percent (35%) of the amount due by A-S under such invoice under the OEM Agreement in satisfaction of the Agreement Repayment Amount; and (ii) credit the applicable invoice by an amount equal to the Agreement Repayment Amount.

1.2.2 Immediately upon each occurrence of Strides becoming entitled to any amount as a return of Capital Contribution, an equal amount shall become due and payable under this Agreement.

1.3 Prepayments. Strides may prepay all or any part of the principal balance at any time without charge or premium.

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ARTICLE 2. ADDITIONAL TERMS AND CONDITIONS

2.1 Application of Payments . All payments received, irrespective of how they may be designated by Strides, shall be applied in this order: first, to amounts other than interest and principal, if any, owing under this Agreement, second, to principal; except that, after the occurrence and during the continuation of any Event of Default, all amounts received shall be applied in such order as Holder, in its sole discretion, may elect. Strides waives the application of any statute or rule of law that would otherwise direct, or permit Strides to direct, the order of application of payments made by Strides or amounts otherwise received by Holder.

2.2 No Waiver By Acceptance of Overdue or Partial Payments . If Holder accepts payment of any overdue amount, or partial payment of an amount due and the remainder of such amount is unpaid, such acceptance shall in no event: (a) constitute a cure or waiver of Strides' default with respect to such overdue or unpaid amount; (b) prevent Holder from exercising any of its rights and remedies with respect to Strides' default; or (c) constitute a waiver of Holder' s right to require full ...