Document:

<PAGE>

                                                                    EXHIBIT 10.7

                             FIRST AMENDMENT TO THE
                             U.S. PRODUCT AGREEMENT

     THIS FIRST AMENDMENT to the U.S. Product Agreement, dated as of the 27th
day of February, 2006 ("First Amendment") is made and entered into by and
between Sanofi-Aventis U.S. LLC (formerly Hoechst Marion Roussel, Inc.), a U.S.
company ("Sanofi-Aventis US"), Sanofi-Aventis Deutschland GmbH (formerly Hoechst
Marion Roussel Deutschland GmbH), a German company ("SAD"), and King
Pharmaceuticals, Inc., a U.S. company ("King") (Sanofi-Aventis, SAD and King may
be referred to herein individually as a "Party" and collectively as the
"Parties"). Capitalized terms used in this First Amendment shall have the
meanings ascribed to them in the U.S. Product Agreement among the Parties dated
December 17, 1998, as supplemented by that certain Addendum dated June 30, 2000
(the "Product Agreement") unless otherwise expressly set forth herein.

                                    RECITALS

     WHEREAS, on December 17, 1998, Sanofi-Aventis, SAD and King entered into
the Product Agreement whereby Sanofi-Aventis and SAD granted certain rights to
Ramipril in the U.S. Territory to King; and

     WHEREAS, the Parties wish to amend certain provisions of the Product
Agreement relating to its term and to improvements; and

     WHEREAS, simultaneously with this First Amendment, SAD and King are
entering into an Amended and Restated U.S. Product Manufacturing Agreement, of
even date herewith, to effectuate certain additional modifications contemplated
by the Parties;

     NOW, THEREFORE, pursuant to Section 11.2(b) of the Product Agreement,
Sanofi-Aventis, SAD and King agree to the terms and conditions of this First
Amendment as follows:

     1.   All references in the Product Agreement to "HMRI" or "Hoechst Marion
          Roussel, Inc." shall be replaced with "Sanofi-Aventis US" or
          "Sanofi-Aventis U.S. LLC," respectively; all references in the Product
          Agreement to "HMR GmbH" or "Hoechst Marion Roussel Deutschland GmbH"
          shall be replaced with "SAD" and "Sanofi-Aventis Deutschland GmbH",
          respectively; and all references in the Product Agreement to "HMR" (by
          which HMR and HMR GmbH are referred collectively in the Product
          Agreement) shall be replaced with "Sanofi-Aventis".

     2.   Article I of the Product Agreement shall be amended by adding new
          Sections 1.10(a), 1.12(a), 1.21(a), 1.21(b), 1.26(a) and 1.32(a) as
          follows:

                         1.10(a) "Developed Data Agreement" shall mean that
               certain agreement relating to a Ramipril/HCT combination product
               being negotiated between SAD and King as of the date of execution
               of the First Amendment to this Agreement.

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                         1.12(a) "Exclusivity Term" shall mean the term
               beginning on December 17, 1998 and continuing until the later to
               occur of (i) the Compound Patent Expiration Date or (ii) the
               Pediatric Extension Expiration Date.

                         1.21(a) "Licensed Combination Product" shall mean a
               Licensed Product that contains Ramipril as one of its active
               ingredients and contains at least one additional active
               ingredient.

                         1.21(b) "Licensed Mono-Product" shall mean a Licensed
               Product that contains Ramipril as its sole active ingredient.

                         1.26(a) "Pediatric Extension Expiration Date" shall
               mean the date of expiration of any pediatric exclusivity
               extension that may be granted by the FDA to King for Licensed
               Mono-Product, provided that in no event will such date extend
               beyond April 30, 2009.

                         1.32(a) "Third Party" or "Third Parties" shall mean any
               person other than Sanofi-Aventis US, SAD and King.

                         1.33 "U.S. Product Manufacturing Agreement" shall mean
               the Amended and Restated U.S. Product Agreement entered into by
               the parties of even date with the First Amendment to this
               Agreement.

     3.   All references in the Product Agreement to "third party" or "third
          parties" shall be replaced with "Third Party" or "Third Parties".

     4.   Section 2.1 of the Product Agreement shall be amended by deleting
          Section 2.1 in its entirety and replacing in its stead the following:

                    2.1  Patent Rights and Schering Patent Rights.

                         (a)  Patent Rights.

                              (i) During Exclusivity Term. Sanofi-Aventis hereby
               grants to King an exclusive (including as to Sanofi-Aventis,
               except as reserved in Section 2.3) license in the U.S. Territory
               with the right to grant sublicenses in the U.S. Territory (upon
               prior written approval of Sanofi-Aventis) under the Patent Rights
               to make and have made Licensed Products from ramiprilat and, in
               finished product form, from ramipril in Bulk Form supplied by
               SAD, use (subject to Section 2.6), sell and have sold the
               Licensed Product in the Field of Use until the end of the
               Exclusivity Term.

                              (ii) After Exclusivity Term. Effective immediately
               upon the expiration of the Exclusivity Term, Sanofi-Aventis
               hereby grants to King the following:

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                                   (A) Licensed Mono-Product. A license that is
               exclusive with the right to grant sublicenses in the U.S.
               Territory (upon prior written approval of Sanofi-Aventis) under
               the Patent Rights to make, have made, use (subject to Section
               2.6), sell and have sold the Licensed Mono-Products in the Field
               of Use for the remaining term of this Agreement.

                                   (B) Licensed Combination Products. A license
               that is exclusive against Third Parties but non-exclusive as to
               Sanofi-Aventis in the U.S. Territory with the right to grant
               sublicenses in the U.S. Territory (upon prior written approval of
               Sanofi-Aventis) under the Patent Rights to make, have made, use
               (subject to Section 2.6), sell and have sold the Licensed
               Combination Products in the Field of Use for the remaining term
               of this Agreement. For the sake of clarity, Sanofi-Aventis shall
               be entitled to make, have made, use, sell, have sold, develop or
               have developed Licensed Combination Products in the U.S.
               Territory after the end of the Exclusivity Term, subject to the
               last sentence of Section 8.2(c). For the sake of further clarity,
               in the event the Developed Data Agreement is executed,
               Sanofi-Aventis' right to make, have made, use, sell, have sold,
               develop or have developed "licensed products" (as such term is
               defined in the Developed Data Agreement), will be subject to the
               terms of the Developed Data Agreement, including without
               limitation any exclusive rights granted to King thereunder.

                                   (C) Development and Commercialization by
               Sanofi-Aventis. For the sake of clarity, the parties acknowledge
               and agree that, after the Exclusivity Term, Sanofi-Aventis shall
               not grant an out-license except to Third Parties who are parties
               to a collaboration agreement with Sanofi-Aventis to jointly
               develop or jointly market Licensed Combination Products, and
               shall not grant any such license or other right to any Third
               Party to enable or permit such Third Party to commercialize any
               Licensed Combination Product independent of Sanofi-Aventis.

                              (iii) The grant of rights to King under this
               Section 2.1(a) is subject to the reservation of rights by
               Sanofi-Aventis in Section 2.3.

                         (b)  Schering Patent Rights.

                              (i) During Exclusivity Term. Sanofi-Aventis hereby
               grants to King an exclusive (including as to Sanofi-Aventis,
               except as reserved in Section 2.3) sublicense in the U.S.
               Territory with the right to grant sublicenses in the U.S.
               Territory (upon prior written approval of Sanofi-Aventis) under
               the Schering Patent Rights with respect to Ramipril to make and
               have made Licensed Products from ramiprilat and, in finished

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               product form, from ramipril in Bulk Form supplied by SAD, use
               (subject to Section 2.6), sell and have sold the Licensed Product
               in the Field of Use until the earlier to occur of the end of the
               Exclusivity Term or the termination of the Schering Agreement.

                              (ii) After Exclusivity Term. In the event the
               Schering Agreement survives the end of the Exclusivity Term,
               then, effective immediately upon the expiration of the
               Exclusivity Term, Sanofi-Aventis hereby grants to King the
               following:

                                   (A) Licensed Mono-Products. A sublicense that
               is exclusive in the U.S. Territory with the right to grant
               sublicenses in the U.S. Territory (upon prior written approval of
               Sanofi-Aventis) under the Schering Patent Rights with respect to
               Ramipril to make, have made, use (subject to Section 2.6), sell
               and have sold the Licensed Mono-Products in the Field of Use
               until the earlier to occur of the termination of this Agreement
               or the Schering Agreement; and

                                   (B) Licensed Combination Products. A
               sublicense that is exclusive against Third Parties but
               non-exclusive as to Sanofi-Aventis, in the U.S. Territory with
               the right to grant sublicenses in the U.S. Territory (upon prior
               written approval of Sanofi-Aventis) under the Schering Patent
               Rights with respect to Ramipril to make, have made, use (subject
               to Section 2.6), sell and have sold the Licensed Combination
               Products in the Field of Use until the earlier to occur of the
               termination of this Agreement or the Schering Agreement. For the
               sake of clarity, Sanofi-Aventis shall be entitled to make, have
               made, use, sell, have sold, develop or have developed Licensed
               Combination Products in the U.S. Territory after the end of the
               Exclusivity Term, subject to the last sentence of Section 8.2(c).
               For the sake of further clarity, in the event the Developed Data
               Agreement is executed, Sanofi-Aventis' right to make, have made,
               use, sell, have sold, develop or have developed "licensed
               products" (as such term is defined in the Developed Data
               Agreement) will be subject to the terms of the Developed Data
               Agreement, including without limitation any exclusive rights
               granted to King thereunder.

                              (iii) The grant of rights to King under this
               Section 2.1(b) is subject to the reservation of rights by
               Sanofi-Aventis in Section 2.3.

                         (c) Conversion to Non-Exclusive. In the event King
               fails to make required payments consistent with the terms of
               Sections 2.9(c) or 3.2(a) of the U.S. Product Manufacturing
               Agreement (a "Payment Default"), and Sanofi-Aventis exercises its
               right to liquidated damages pursuant to Section 3.2(c) of such
               agreement, and terminates such agreement for such Payment Default
               by King, pursuant to Section

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<PAGE>

               4.2(a) of such agreement, then (i) the rights and licenses
               granted to King pursuant to this Agreement (including rights and
               licenses to Improvements) shall, automatically, upon the
               effective date of such termination become exclusive against Third
               Parties but non-exclusive as to Sanofi-Aventis, with the right to
               grant sublicenses in the U.S. Territory (upon prior written
               approval of Sanofi-Aventis) to make, have made, use (subject to
               Section 2.6), sell and have sold the Licensed Products in the
               Field of Use for the remaining term of this Agreement, (ii) the
               parties' rights to Improvements pursuant to Section 8.2 shall
               terminate with respect to any Improvements discovered, made or
               conceived after the effective date of such termination, and (iii)
               the parties' rights to elect to acquire Improvements discovered,
               made or conceived prior to the effective date of such termination
               shall survive such termination on a non-exclusive basis as
               described in Section 2.1(c)(i) hereof.

     5.   Section 2.2 of the Product Agreement is amended by deleting in its
          entirety the first sentence and replacing in its stead the following:

                         Sanofi-Aventis hereby grants to King, and all
               sublicensees hereunder, the non-exclusive right to use the
               Ramipril Know-How disclosed by Sanofi-Aventis or its Affiliates
               under this Agreement in the Field of Use for the term of this
               Agreement in the U.S. Territory (a) during the Exclusivity Term,
               to manufacture Licensed Products from ramiprilat (if any), and,
               in finished product form, from ramipril in Bulk Form supplied by
               Sanofi-Aventis, to use (subject to Section 2.6), sell and have
               sold Licensed Product and (b) after the Exclusivity Term, to
               manufacture, use (subject to Section 2.6), sell and have sold
               Licensed Product.

     6.   Section 2.3 of the Product Agreement is amended by adding a sentence
          at the end of subsection (d) as follows:

                         ; and, subject to the provisions of Sections 2.1(a)(ii)
               and 2.1(b)(ii) and the last sentence of 8.2(c), and further
               subject to the terms and conditions of the Developed Data
               Agreement, in the event such agreement is executed, with respect
               to "licensed products" (as that term is defined in the Developed
               Data Agreement) to make, have made, use, sell, have sold, develop
               or have developed, whether inside or outside the U.S. Territory,
               Licensed Combination Products after the Exclusivity Term.

     7.   Section 2.5 of the Product Agreement shall be amended by deleting
          Section 2.5 in its entirety and replacing in its stead the following:

                         2.5 Sanofi-Aventis' Rights under Patent Rights and
               Ramipril Know-How to Manufacture Ramipril. Sanofi-Aventis and its
               Affiliates retain all rights under the Patent Rights and the
               Ramipril Know-How to make and have made Product (as such term
               defined in the U.S.

                                        5

<PAGE>

               Product Manufacturing Agreement). Pursuant to the U.S. Product
               Manufacturing Agreement, SAD shall provide Product to King during
               the Term (as such term is defined in the U.S. Product
               Manufacturing Agreement) of the U.S. Product Manufacturing
               Agreement, on the terms and conditions set forth in the U.S.
               Product Manufacturing Agreement.

     8.   Article II of the Product Agreement shall be amended by adding a new
          Section 2.10 as follows:

                         2.10 King's Rights Concerning Clinical Trials and
               Development Work. King shall have the right to conduct Clinical
               Trials and Experimental Uses in countries outside the U.S.
               Territory in order to obtain and maintain regulatory approvals
               for Licensed Product in the U.S. Territory; provided that the
               right granted to King in this Section 2.10 shall be subject to
               the requirements of Sections 2.6 and 3.1 of this Agreement and
               provided further that King shall have no right to conduct such
               activities in Canada for so long as Sanofi-Aventis continues to
               own patents or have exclusive in-licensed rights to one or more
               issued patents that claim the ramipril compound, which patents
               have not been held invalid or unenforceable in a final,
               unappealable decision.

     9.   Section 3.1(d)(iii) of the Product Agreement is amended to add the
          following as its last sentence:

               The parties acknowledge and agree that, pursuant to Sections
               3.1(b) and 3.1(d), King has the right to request Requested
               Meetings on an ad hoc basis, which meetings may be held by
               teleconference, if so requested by either party, and shall be
               held within thirty (30) days of King's request therefor. In
               connection therewith, the parties agree to address issues
               (Section 3.1(d)) in a timely manner and to cooperate in the
               implementation of the process with respect to Requested Meetings
               going forward.

     10.  Section 8.2 of the Product Agreement is amended by deleting the first
          sentence of Section 8.2 in its entirety and replacing in its stead the
          following:

                    8.2 Rights to Improvements. In the event that either party
               discovers, makes or conceives of an Improvement (other than an
               Excluded Combination Product) (a) during the term of this
               Agreement, with respect to Licensed Mono-Products or (b) during
               the Exclusivity Term with respect to Licensed Combination
               Products, the following provisions apply:

     11.  Section 8.2(c) of the Product Agreement is amended by deleting Section
          8.2(c) in its entirety and replacing in its stead the following:

                         (c) Procedure; Other Terms. The party discovering or
               acquiring an Improvement shall give notice (the "Offer Notice")
               to the other party of the discovery or acquisition of such
               Improvement. The

                                        6

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               Offer Notice shall be given in a timely manner, and no later than
               30 (thirty) days after receipt by the party discovering or
               acquiring the Improvement of the final report of the study
               results for the Phase IIB Clinical Trials of such Improvement.
               Such Offer Notice shall include: (i) a description of the
               Improvement; (ii) the Development Costs; and (iii) a form of the
               license agreement containing such reasonable terms and conditions
               as are customary in the pharmaceutical industry for products of a
               similar commercial value. At any time within one hundred twenty
               (120) days after receipt of an Offer Notice, the receiving party
               may elect to acquire the Improvement on the terms and conditions
               set forth in the Offer Notice, or on any such other terms and
               conditions which the parties may negotiate in good faith.
               Notwithstanding anything to the contrary in Section 2.1(a)(ii) or
               2.1(b)(ii), any license granted to King pursuant to this Section
               8.2(c) with respect to Improvements discovered, made or conceived
               prior to the end of the Exclusivity Term on Licensed Combination
               Products shall be and remain exclusive both during and after the
               Exclusivity Term.

     12.  Article 8 of the Product Agreement shall be amended by adding new
          Sections 8.3 and 8.4 as follows:

                    8.3 Rights to Improvements After the Compound Patent
               Expiration Date. In the event that either party discovers, makes
               or conceives an Improvement with respect to Licensed Combination
               Products after the Exclusivity Term, such party shall have no
               obligation to notify the other party of such Improvement or to
               offer such other party any rights in such Improvement.

                    8.4 Notice of Improvements. Within thirty (30) days after
               execution of the First Amendment to this Agreement, each party
               shall provide to the other party the notice required under
               Section 8.2(c) of any Improvements made by such party for which a
               final report of the study results for such Phase IIB Clinical
               Trials has been received by such party, or any Improvements which
               exist in a later stage of development.

     13.  Section 11.1(a) of the Product Agreement is amended by deleting the
          party names, addresses and facsimile numbers of the Sanofi-Aventis
          notice parties and replacing them as follows:

               If to Sanofi-Aventis to:

                    Sanofi-Aventis Deutschland GmbH
                    Attn: Legal Department
                    Brueningstrasse 50
                    65926 Frankfurt

                                        7

<PAGE>

                    Germany
                    Fax: Legal Department No.: ++ 49 69 305 24590

               with a copy to:

                    Sanofi-Aventis
                    174 Avenue de France
                    75013 Paris France
                    Attn: Head of Business Development
                    Facsimile: + 33 1 5377 4967

               with a copy to:

                    Sanofi-Aventis
                    174 Avenue de France
                    75013 Paris France
                    Attn: Head of Direction Juridique
                    Facsimile: +33-01-53-77-40-48

     14.  Except as modified by this First Amendment, all of the terms and
          conditions of the Product Agreement shall remain in full force and
          effect.

     15.  Articles X and XI of the Product Agreement are hereby incorporated
          into this First Amendment.

                                       8

<PAGE>

     IN WITNESS WHEREOF, the Parties hereto have each caused this First
Amendment to the U.S. Product Agreement to be executed by their duly authorized
officers to be effective as of the date first written above.

KING PHARMACEUTICALS, INC.              SANOFI-AVENTIS U. S. LLC

By:                                     By:
    ---------------------------------       ------------------------------------
Name:                                   Name:
      -------------------------------         ----------------------------------
Title:                                  Title:
       ------------------------------          ---------------------------------

                                        SANOFI-AVENTIS DEUTSCHLAND GMBH

                                        By:
                                            ------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

                                        SANOFI-AVENTIS DEUTSCHLAND GMBH

                                        By:
                                            ------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------<PAGE>
                                                                    EXHIBIT 10.8

                           KING PHARMACEUTICALS, INC.

                                 INCENTIVE PLAN

                  LONG-TERM PERFORMANCE UNIT AWARD CERTIFICATE
                          (ONE-YEAR PERFORMANCE CYCLE)

     This Certificate, when executed by a duly authorized officer of King
Pharmaceuticals, Inc. (the "Company") and by Participant, evidences the grant by
the Company to the Participant named below of a Long-Term Performance Unit
Award.

<TABLE>
<S>                                     <C>
1. Name and Address of Participant:
                                        ----------------------------------------

                                        ----------------------------------------

                                        ----------------------------------------

2. Date of Grant:
                                        ----------------------------------------

3. Type of Grant:                       Long-Term Performance Unit Award

4. Target Number of
   Long-Term Performance Units:
                                        ----------------------------------------

5. Performance Cycle:                   The Performance Cycle shall being on January
                                        1, 2006 and end on December 31, 2006.

6. Vesting Period:                      The Vesting Period shall begin on January 1,
                                        2007 and end on December 31, 2008, except as
                                        otherwise set forth in the Long-Term
                                        Performance Unit Award Agreement.

7. Date of Payment:                     March 15, 2009, except as otherwise set forth in
                                        the Long-Term Performance Unit Award Agreement.

8. Performance Goals:
</TABLE>

     The number of Long-Term Performance Units earned by the Participant shall
be determined in accordance with the following grid. If the actual performance
results fall between two of the categories listed below, straight-line
interpolation will be used to determine the amount earned. The Financial
Objectives shall be listed and shall be calculated in the manner set forth in
Exhibit 1 hereto.
--------------------------------------------------------------------------------

<Table>
<S>                                                               <C>
 KING PHARMACEUTICALS, INC. ANNUAL PERFORMANCE V. STATED           PAYOUT--PERCENT OF TARGET
                FINANCIAL OBJECTIVES                              LONG-TERM PERFORMANCE UNITS
            DURING THE PERFORMANCE CYCLE                                   GRANTED

                   Above Stretch                                             200%
----------------------------------------------------------------------------------------------
                     Stretch                                                 200%
----------------------------------------------------------------------------------------------
                      Target                                                 100%
----------------------------------------------------------------------------------------------
                    Threshold                                                 50%
----------------------------------------------------------------------------------------------
                 Below Threshold                                        0% (no payout)
----------------------------------------------------------------------------------------------
</Table>

<PAGE>

     This Long-Term Performance Unit Award is subject to and governed by the
terms of this Long-Term Performance Unit Award Certificate, the Long-Term
Performance Unit Award Agreement attached hereto and incorporated by reference
herein and the Company's Incentive Plan.

                                       KING PHARMACEUTICALS, INC.

                                       By:
                                           ----------------------------------
                                           Name:
                                                 ----------------------------
                                           Title:
                                                 ----------------------------

                                       PARTICIPANT

                                       --------------------------------------

This Long-Term Performance Unit Award Certificate may be executed in more than
one counterpart, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument. Facsimile or
photographic copies of originally signed copies of this Long-Term Performance
Unit Award Certificate will be deemed to be originals.

                                       2
<PAGE>

                                                                    Exhibit 10.8

                   LONG-TERM PERFORMANCE UNIT AWARD AGREEMENT.
                          (ONE YEAR PERFORMANCE CYCLE)
                   PURSUANT TO THE KING PHARMACEUTICALS, INC.
                                 INCENTIVE PLAN

     This Long-Term Performance Unit Award Agreement (the "Agreement") is made
as of the date set forth on the Long-Term Performance Unit Award Certificate
attached hereto (the "Grant Date") by King Pharmaceuticals, Inc. (the "Company")
and the individual identified on the Long-Term Performance Unit Award
Certificate (the "Participant") to grant a Long-Term Performance Unit Award by
the Company to the Participant on the terms and conditions set forth below:

     1. LONG-TERM PERFORMANCE UNIT AWARD.

     As of the Grant Date, subject to the terms, conditions and restrictions set
forth herein, the Company grants and issues to the Participant a Long-Term
Performance Unit Award for such number of Long-Term Performance Units as
indicated on the Long-Term Performance Unit Award Certificate (the "Long-Term
Performance Units") which may be earned during the Performance Cycle as
indicated on the Long-Term Performance Unit Award Certificate if the Performance
Goals set forth on the Long-Term Performance Unit Award Certificate are met.

     2. GOVERNING PLAN.

     The Long-Term Performance Unit Award shall be granted pursuant to and
(except as specifically set forth herein) subject in all respects to the
applicable provisions of the King Pharmaceuticals, Inc. Incentive Plan ("Plan"),
which are incorporated herein by reference. Terms not otherwise defined in this
Agreement have the meanings ascribed to them in the Plan.

     3. CALCULATION OF EARNED LONG-TERM PERFORMANCE UNITS.

     The Committee, in its sole discretion, will determine the number of
Long-Term Performance Units earned by the Participant at the end of the
Performance Cycle based on the attainment of the Performance Goals as set forth
on the Long-Term Performance Unit Award Certificate. The number of shares of
Common Stock ultimately earned and paid, if any, for such Long-Term Performance
Units will be determined based on the number of Long-Term Performance Units
actually earned and vested as set forth in Section 4 below, with one share of
Common Stock granted to the Participant for every earned and vested Long-Term
Performance Unit.

     4. VESTING OF LONG-TERM PERFORMANCE UNITS.

     Long-Term Performance Units earned will vest as set forth below:

          (a) Provided the Participant has continued employment through the end
of the Vesting Period set forth in the Long-Term Performance Unit Award
Certificate, one hundred percent (100%) of the earned Long-Term Performance
Units shall vest on the last day of such Vesting Period; or

                                  Exhibit 1-1

<PAGE>

          (b) In the event of the Participant's Separation from Service by
reason of death, Disability, Approved Retirement, Cause, resignation or any
other reason during the Performance Cycle, the vesting, forfeiture and payment
of Long-Term Performance Units shall be determined according to Section 9.2 and
Section 13.5 of the Plan, which requires that all payments comply with Section
409A of the Code.

     5. FORM AND TIMING OF PAYMENT.

     All payments of vested Long-Term Performance Units pursuant to this
Agreement will be made in the form of shares of Common Stock. Except as
otherwise provided in this Agreement, payment will be made by the Date of
Payment set forth in the Long-Term Performance Unit Award Certificate; provided,
however, if, the Participant is a "specified employee" (as defined under Section
409A of the Code) then such payment, if required by Section 409A of the Code,
will be made six months after the date of such Separation from Service.

     6. VOTING AND DIVIDEND RIGHTS.

     Except as specifically set forth in this Agreement, the Participant shall
not have voting or any other rights as a shareholder of the Company with respect
to Long-Term Performance Units. The Participant will obtain full voting and
other rights as a shareholder of the Company upon the payment of the Long-Term
Performance Units in shares of Common Stock as provided in Section 5 above.

     7. ADDITIONAL AGREEMENTS.

          (a) Tax Matters. The Long-Term Performance Units granted are subject
to appropriate income tax withholding and other deductions required by
applicable laws or regulations, and Participant and his successors will be
responsible for all income and other taxes payable as a result of a payout under
the Long-Term Performance Units or otherwise in connection with this Agreement.
The Company will have the power and the right to deduct or withhold, or require
the Participant or the Participant's beneficiary to remit to the Company, the
minimum necessary amount to satisfy federal, state, and local taxes, domestic or
foreign, required by law or regulation to be withheld with respect to any
taxable event arising as a result of this Agreement. The Company is not required
to provide any gross-up or other tax assistance. With respect to withholding
required upon any taxable event arising as a result of the Long-Term Performance
Units granted hereunder, the Company, unless notified otherwise by the
Participant in writing within thirty (30) days prior to the taxable event, will
satisfy the tax withholding requirement by withholding shares of Common Stock
having a Fair Market Value, equal to the total minimum statutory tax required to
be withheld on the transaction. The Participant agrees to pay to the Company
and/or its Subsidiaries any amount of tax that the Company, its and/or its
Subsidiaries may be required to withhold as a result of the Participant's
participation in the Plan that cannot be satisfied by the means previously
described.

          (b) Independent Advice; No Representations. Participant acknowledges
that (i) (s)he was free to use professional advisors of her/his choice in
connection with this Agreement, has received advice from her/his professional
advisors in connection with this Agreement, understands its meaning and import,
and is entering into this Agreement freely and without coercion or duress; and
(ii) (s)he has not received and is not relying upon any advice,

                                       2
<PAGE>

representations or assurances made by or on behalf of the Company or any Company
affiliate or any employee of or counsel to the Company regarding any tax or
other effects or implications of the Long-Term Performance Units or other
matters contemplated by this Agreement.

          (c) Value of Long-Term Performance Units. No representations or
promises are made to Participant regarding the value of the Long-Term
Performance Units or Company's business prospects. Participant acknowledges that
information about investment in Company stock, including financial information
and related risks, is contained in Company's SEC reports which have been made
available for Participant's review at any time before Participant's acceptance
of this Agreement. Further, Participant understands that the Company does not
provide tax or investment advice and acknowledges Company's recommendation that
Participant consult with independent specialists regarding such matters. Sale or
other transfer of the Company stock may be limited by and subject to Company
policies as well as applicable securities laws and regulations.

          (d) Adjustment in Capitalization. In the event of an Adjustment Event
that is a merger, consolidation, reorganization, liquidation, dissolution or
other similar transaction, then the Award pursuant to Section 1 of this
Agreement shall be deemed to pertain to the securities and other property,
including cash, to which a holder of the number of Long-Term Performance Units
would have been entitled to receive in connection with such Adjustment Event.

          (e) Change of Control. Upon a Change of Control, vesting, forfeiture
and payment shall occur with respect to the Long Term Performance Units in
accordance with Article 11 of the Plan.

          (f) No Right to Continued Employment. This Agreement does not confer
upon Participant any right to continue as an employee of the Company or its
subsidiary or to any particular employment tenure, nor does it limit in any way
the right of Company or its subsidiary to terminate Participant's services to
the Company or its subsidiary at any time, with or without cause.

          (g) Nontransferability. Long-Term Performance Units awarded pursuant
to this Agreement may not be sold, transferred, pledged, assigned or otherwise
alienated or hypothecated (a "Transfer") other than by will or by the laws of
descent and distribution, except as provided in the Plan. If any Transfer,
whether voluntary or involuntary, of Long-Term Performance Units is made, or if
any attachment, execution, garnishment, or lien will be issued against or placed
upon the Long-Term Performance Units, the Participant's right to such Long-Term
Performance Units will be immediately forfeited to the Company, and this
Agreement will lapse.

     8. GENERAL.

          (a) Successors and Assigns. This Agreement is personal in its nature
and Participant may not assign or transfer his/her rights under this Agreement.

          (b) Notices. Any notices, demands or other communications required or
desired to be given by any party shall be in writing and shall be validly given
to another party if served either personally or if deposited in the United
States mail, certified or registered, postage prepaid, return receipt requested.
If such notice, demand or other communication shall be served personally,
service shall be conclusively deemed made at the time of such personal service.
If

                                       3
<PAGE>

such notice, demand or other communication is given by mail, such notice shall
be conclusively deemed given forty-eight (48) hours after the deposit thereof in
the United States mail addressed to the party to whom such notice, demand or
other communication is to be given as hereinafter set forth:

     To the Company:                     King Pharmaceuticals, Inc.
                                         501 Fifth Street
                                         Bristol, TN 37620
                                         Attention:  _________________________

     To Participant: At his/her address of record as maintained in the Company's
files.

Any party may change its address for the purpose of receiving notices, demands
and other communications by providing written notice to the other party in the
manner described in this paragraph.

          (c) Entire Agreement. Except as this Agreement may expressly provide
otherwise, this Agreement, the Long-Term Performance Unit Award Certificate and
the Plan constitute the entire agreement and understanding of the Company and
Participant with respect to the subject matter hereof and thereof, and supersede
all prior written or verbal agreements and understandings between Participant
and the Company relating to such subject matter. This Agreement may only be
amended by written instrument signed by Participant and an authorized officer of
the Company.

          (d) Governing Law; Severability. This Agreement will be construed and
interpreted under the laws of the State of Tennessee applicable to agreements
executed and to be wholly performed within the State of Tennessee. If any
provision of this Agreement as applied to any party or to any circumstance is
adjudged by a court of competent jurisdiction to be void or unenforceable for
any reason, the invalidity of that provision shall in no way affect (to the
maximum extent permissible by law) the application of such provision under
circumstances different from those adjudicated by the court, the application of
any other provision of this Agreement, or the enforceability or invalidity of
this Agreement as a whole. If any provision of this Agreement becomes or is
deemed invalid, illegal or unenforceable in any jurisdiction by reason of the
scope, extent or duration of its coverage, then such provision shall be deemed
amended to the extent necessary to conform to applicable law so as to be valid
and enforceable or, if such provision cannot be so amended without materially
altering the intention of the parties, then such provision will be stricken and
the remainder of this Agreement shall continue in full force and effect.

          (e) Remedies. All rights and remedies provided pursuant to this
Agreement or by law shall be cumulative, and no such right or remedy shall be
exclusive of any other. A party may pursue any one or more rights or remedies
hereunder or may seek damages or specific performance in the event of another
party's breach hereunder or may pursue any other remedy by law or equity,
whether or not stated in this Agreement.

          (f) Interpretation. Headings herein are for convenience of reference
only, do not constitute a part of this Agreement, and will not affect the
meaning or interpretation of this

                                       4
<PAGE>

Agreement. References herein to Sections are references to the referenced
Section hereof, unless otherwise specified.

          (g) Waivers; Amendments. 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
later breach of that provision. This Agreement may be modified only by written
agreement signed by Participant and the Company.

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

                                       5

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