ALLERGAN INC
AMENDMENT TO ALLERGAN EMPLOYEE STOCK OWNERSHIP PLAN
<DOCUMENT>
<TYPE>EX-10.42
<SEQUENCE>10
<FILENAME>dex1042.txt
<DESCRIPTION>AMENDMENT TO ALLERGAN EMPLOYEE STOCK OWNERSHIP PLAN
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                                                                   Exhibit 10.42

                                FIRST AMENDMENT
                                       TO
                                 ALLERGAN, INC.
                          EMPLOYEE STOCK OWNERSHIP PLAN
                                 (RESTATED 2001)

     The ALLERGAN, INC. EMPLOYEE STOCK OWNERSHIP PLAN (the "Plan") is hereby
amended as follows:

1.   Article I of the Plan is amended by renumbering Section 1.4 as Section
     1.5 and adding the following Section 1.4:

             1.4   Spin-Off of Advanced Medical Optics, Inc. In connection with
        the distribution of the stock of Advanced Medical Optics, Inc. ("AMO")
        by Allergan to its stockholders (the "AMO Spin-Off") and effective June
        29, 2002 which shall be the AMO Spin-Off Date: (i) AMO Employees (as
        defined in Section 2.16) shall cease to be "Eligible Participants" (as
        defined in Section 4.2(a)) and shall not be eligible to receive
        allocations of Company contributions or forfeitures pursuant to Section
        4.2 and Section 4.3, respectively or any allocations of unallocated
        assets pursuant to Section 10.1 upon termination of the Plan, (ii) the
        assets and liabilities attributable to the Accounts of "AMO Employees"
        shall be transferred to the Advanced Medical Optics, Inc. 401(k) Plan, a
        qualified profit sharing plan with a qualified cash or deferred
        arrangement, in accordance with Code Section 414(1), Regulation Section
        1.414(1)-1, and Section 208 of ERISA, (iii) the AMO stock received with
        respect to Company Stock allocated to Participants' ESOP Accounts shall
        be held in a separate investment fund established by the Committee
        pursuant to Section 6.3(c) and Participants shall have subaccounts under
        the Plan corresponding to their interest in such investment fund, and
        (iv) the AMO stock received with respect to Company Stock held in the
        Exempt Loan Suspense Subfund or Company Stock not yet allocated to
        Participants' ESOP Accounts shall be applied or retained as determined
        by the Committee in accordance with Section 6.7(b).

2.   Section 2.16 of the Plan is amended as follows:

             2.16   Employee. "Employee" shall mean, for purposes of the Plan,
        any individual who is employed by the Sponsor or an Affiliated
        Company in any capacity, any portion of whose income is subject to
        withholding of income tax and/or for whom Social Security contributions
        are made by the Sponsor or an Affiliated Company; provided, however,
        that such term shall not include:

                    (a)  Any individual who performs services for the Sponsor or
           an Affiliated Company and who is classified or paid as an independent
           contractor as determined by the payroll records of

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           the Sponsor or an Affiliated Company even if a court or
           administrative agency determines that such individual is a common-law
           employee and not an independent contractor;

                    (b)  Any individual who performs services for the Sponsor or
           an Affiliated Company pursuant to an agreement between the Sponsor or
           an Affiliated Company and any other person including a leasing
           organization except to the extent such individual is a Leased
           Employee; and

                    (c)  Any individual whose employment is transferred from the
           Sponsor or an Affiliated Company to Advanced Medical Optics, Inc.
           ("AMO") in connection with the distribution of the stock of AMO by
           the Sponsor to its stockholders, effective as of the day following
           such transfer, hereinafter referred to as an "AMO Employee." An
           individual is an AMO Employee if classified or identified as such in
           the payroll records of the Sponsor or an Affiliated Company or in the
           Employee Matters Agreement entered into between the Sponsor and AMO.

3.   Section 5.9 of the Plan is amended as follows:

           5.9   Form of Distribution.
                 --------------------

                 (a)   All shares of Company Stock or Advanced Medical Optics,
           Inc. allocated to a Participant's ESOP Account shall be distributed
           in the form of cash, unless the Participant elects under paragraph
           (b) below to receive the distribution in the form of Company Stock or
           Advanced Medical Optics, Inc. stock, with cash in lieu of fractional
           shares. To the extent that Company Stock or Advanced Medical Optics,
           Inc. stock must be valued to effect such a distribution, such
           valuation shall be equal to the fair market value of such stock
           determined as of the last Valuation Date prior to the date of
           distribution.

                 (b)   A Participant may elect that all shares of Company Stock
           or Advanced Medical Optics, Inc. allocated to his or her ESOP Account
           be distributed in the form of Company Stock or in the form of
           Advanced Medical Optics, Inc. stock, with cash in lieu of fractional
           shares. Any cash or other property, including Advanced Medical
           Optics, Inc. stock, in a Participant's ESOP Account ("non-Company
           Stock assets") shall be used to acquire Company Stock for
           distribution only if such Participant further elects and only if such
           stock is available on the open market. If such Participant elects to
           receive the non-Company Stock assets in his or her ESOP Account in
           Company Stock and such stock is available on the open market, the
           value of such non-Company Stock assets shall be used to acquire such
           whole shares of Company Stock as may be acquired with such value and
           any remaining amount shall be distributed in cash.

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           Notwithstanding the foregoing, if applicable corporate charter or
           bylaw provisions restrict ownership of substantially all outstanding
           Company Stock to Employees or to a plan or trust described in Code
           Section 401(a), then any distribution of a Participant's ESOP Account
           shall only be in cash.

                 (c)   Notwithstanding the foregoing, in the case of an Eligible
           Rollover Distribution, a Participant may elect that an Eligible
           Rollover Distribution be paid directly by the Trustee to the trustee
           of an Eligible Retirement Plan.

4.   Section 5.11(c) of the Plan is amended as follows:

                 (c)   This Section shall be applied to any securities of the
           Company held by the Plan to the extent required under Code Section
           401(a)(23) and the regulations issued thereunder and its provisions
           shall be interpreted and applied in accordance with all applicable
           requirements of Code Section 409(h) and the regulations issued
           thereunder.

5.   Section 5.12(c) of the Plan is amended as follows:

                 (c)   A Qualified Participant who elects to diversify his or
           her ESOP Account as provided under this Section shall do so by
           transferring diversified amounts to any of the investment funds
           currently offered and currently available to Participants as
           determined by the Committee pursuant to Section 6.3(c); provided,
           however, that any allocations among the investment funds shall be
           made in 1% increments. Any election to diversify shall be effective
           as soon as administratively feasible and subject to paragraph (e)
           below. A Qualified Participant shall effect a diversification
           election by properly completing and submitting the form authorized by
           the Committee for this purpose.

6.   Section 6.3(a) of the Plan is amended as follows:

                 (a)   Subject to paragraph (c) below and Sections 6.4 and 5.12
           hereof, the Trust Fund shall be invested primarily in Company Stock
           and neither the Company nor the Committee nor the Trustee shall have
           any responsibility or duty to time any transaction involving Company
           Stock, in order to anticipate market conditions or changes in stock
           value, nor shall any such person have any responsibility or duty to
           sell Company Stock held in the Trust Fund (or otherwise to provide
           investment management for Company Stock held in the Trust Fund) in
           order to maximize return or minimize loss. The Committee may direct
           the Trustee to have the Plan enter into one or more Exempt Loans to
           finance the acquisition of Company Stock for the Trust Fund. Company
           contributions in cash, and other cash received or held by the
           Trustee, may be used to acquire shares

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           of Company Stock from the Company, Company shareholders, from the
           ESOP Accounts of Participants about to receive distributions under
           the Plan, or on the open market.

7.   Section 6.3 of the Plan is amended by adding the following paragraph (c):

                 (c)   Notwithstanding paragraph (a) above, the Committee may
           establish separate investment funds under the Plan, with each fund
           representing an investment alternative available to Participants for
           the investment of their ESOP Accounts as provided in paragraph (d)
           below and Section 5.12. Each Participant shall have a subaccount
           under the Plan corresponding to the Participant's interest which is
           allocated to each investment fund. Each such subaccount may be valued
           separately. The manner in which assets of the Trust shall be invested
           in such investment funds, including the establishment of alternative
           investment funds, the elimination of any previously established
           funds, or the placement of limitations on the availability of an
           investment fund to Participants, shall be chosen by the Committee at
           its discretion. Amounts invested in any one of the investment funds
           shall not share in gains and losses experienced by any other fund.
           Notwithstanding the establishment of separate investment funds within
           the Trust, the Trust shall at all times constitute a single trust.

8.   Section 6.3 of the Plan is amended by adding the following paragraph (d):

                 (d)   A Participant may elect at any time to transfer any cash
           or other property, including shares of Advanced Medical Optics, Inc.
           ("non-Company Stock assets") or amounts previously diversified under
           Section 5.12, accumulated in his or her ESOP Account among any of the
           investment funds currently offered and currently available to
           Participants as determined by the Committee pursuant to paragraph (c)
           above; provided, however, the total amount transferred shall be made
           in 1% increments of the amount accumulated in such funds. Any
           transfer among investment funds shall be effective as soon as
           administratively feasible. A Participant shall effect a transfer
           election by properly completing and submitting the form authorized by
           the Committee for this purpose.

9.   Section 6.3 of the Plan is amended by adding the following paragraph (e):

                 (e)   Notwithstanding anything in the Plan to the contrary, the
           following additional transfer restrictions shall apply to all
           Participants who are Insiders as defined in Section 5.12.

                       (i)   Any Insider who transfers amounts invested in
                 Company Stock and into another fund or withdraws cash in a
                 transaction that results in the liquidation of Company Stock
                 (pursuant to Sections 5.7 or to the extent applicable under

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                 Section 5.12), may not for a period of six months following the
                 Participant's election to so transfer funds or withdraw cash,
                 as the case may be, make an election to transfer amounts from
                 another fund and invest in Company Stock.

                       (ii)   Any Insider who transfers amounts invested in a
                 non-Company Stock fund to invest in Company Stock, may not for
                 a period of six months following the Participant's election to
                 so transfer funds make an election to (1) sell Company Stock
                 and transfer the proceeds to another fund, (2) withdraw cash
                 that results in the liquidation of Company Stock or (3) make a
                 diversification election under Section 5.12 subject to the
                 requirements of Code Section 401(a)(28), if applicable or (4)
                 utilize the Allergan Inc. Savings and Investment Plan or the
                 provision of any Company plan covered by Rule 16b-3
                 (promulgated pursuant to the Exchange Act) then in existence
                 that would result in the transfer out of a Company equity
                 securities fund.

10.  Section 6.3 of the Plan is amended by adding the following paragraph (f):

                 (f)   It is intended that to the extent a Participant may
           diversify or direct the investment of his or her ESOP Account under
           the Plan that the Plan constitute a plan described in Section 404(c)
           of ERISA and the regulations thereunder, and neither the Company,
           Committee, nor any fiduciary with respect to the Plan who is employed
           by the Company shall be liable for investment losses sustained by any
           Participant or Beneficiary as a direct and necessary result of the
           investment instructions given by such Participant or Beneficiary.
           Such fiduciaries set forth in the preceding sentence shall be under
           no duty to question the investment direction of the Participant or
           Beneficiary or to advise a Participant or Beneficiary as to the
           manner in which his or her ESOP Account is to be invested. The fact
           that an investment option is offered shall not be construed to be a
           recommendation of investment.

11.  Section 10.4 of the Plan is amended by adding the following paragraph (d):

                 (d)   For purposes of this Section 10.4, a Change of Control
           shall not be deemed to have occurred upon the distribution of the
           stock of Advanced Medical Optics, Inc., on or about July 1, 2002, by
           the Sponsor to its stockholders.

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     IN WITNESS WHEREOF, Allergan, Inc. hereby executes this First Amendment to
the Allergan, Inc. Employee Stock Ownership Plan on this 26th day of June, 2002.

ALLERGAN. INC.

BY: /s/ Eric Brandt
    -----------------------------------
    Eric Brandt
    Corporate Vice President

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