Twentynine Palms City Council
July 23, 2024

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2. Kroger shall document and for a period outlined in appendix A maintain records of any such reports that are made to Settling States regarding confirmed fraudulent or forged prescriptions, which are maintained centrally.

XIV. ENFORCEMENT OF INJUNCTIVE TERMS

1. Notice of Potential Violations and Opportunity to Cure. a. A “Potential Violation” occurs when the Settling State determines, after appropriate investigation and due diligence, that Kroger is not in substantial compliance with a material aspect of the Injunctive Terms. A Potential Violation may be for a single retail pharmacy. A violation of this Agreement is not presumed to occur when a pharmacist, pharmacist technician, or other field personnel who supervise pharmacists and/or pharmacist technicians employed by Kroger violates Kroger’s CSCP Policies and Procedures. b. Potential Violation Discovered by Settling State.
i. In the event of a Potential Violation identified by a Settling State, the Settling State shall notify Kroger in writing (the “State’s Notice”). ii. Within thirty (30) days of receipt of the State’s Notice, Kroger shall provide a written response to the Settling State. The response shall include Kroger’s position as to the act(s) of non-compliance, including, possibly, a statement setting forth why Kroger believes it is in substantial compliance with the relevant provision(s) or a statement explaining how the Potential Violation has been addressed.
iii. If the Settling State wishes to meet with Kroger, Kroger shall promptly make itself available for such a meeting.
c. If, after review of a written response and any meeting, the Settling State believes that a Potential Violation is ongoing or has not been substantially addressed, it will provide written notice to Kroger and work in conjunction with Kroger to devise, within thirty (30) days, a corrective action plan (“Corrective Action Plan”) to remedy such Potential Violation, including a reasonable period for implementation of such plan.
d. Within sixty (60) and one hundred twenty (120) days after implementing the Corrective Action Plan, Kroger will provide a written compliance update to the Settling State and make itself available to meet with the Settling State if requested. If after reviewing the compliance update and any meeting, the Settling State believes a Potential Violation remains ongoing or has not been substantially addressed, the Settling State may commence a 30-day mediation period. If mediation fails to resolve the dispute between the parties, the Settling State may take whatever action it deems necessary, including but not limited to bringing an action to enforce these Injunctive Terms, filing a new action (administrative or civil action) for violation of the Injunctive Terms as allowed

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by state law, conducting further investigation, or attempting to negotiate an updated Corrective Action Plan with Kroger. But the Settling State may not seek to reinstate claims that have been released as part of the Settlement Agreement.
e. If Kroger fails or refuses to provide a written response, to devise or implement a Corrective Action Plan or to provide a compliance update as required by subsections 1(b), 1(c) and/or 1(d), a Settling State may bring an action to enforce these Injunctive Terms, filing a new action (administrative or civil action) for violation of the Injunctive Terms as allowed by state law, conduct further investigation, or attempt to negotiate an updated Corrective Action Plan with Kroger. But the Settling State may not seek to reinstate claims that have been released as part of the Settlement Agreement.
f. If, after review of a written response and any meeting, pursuant to subsections 1b. or 1c., above, the Settling State concludes that a Potential Violation is not ongoing or has been substantially addressed, the Settling State will provide written notice of this conclusion to the Settling Pharmacy within thirty (30) days of reaching its conclusion.

2. Enforcement Action. Each Settling State agrees that prior to taking any court or administrative action, other than an action that the Settling State concludes is necessary to address an immediate threat to the health, safety, or welfare of the citizens of the Settling State, or that a public emergency requiring immediate action exists, it will follow the process outlined above. If the Settling State concludes that action is necessary to address an immediate threat to the health, safety, or welfare of the citizens of the Settling State or that a public emergency requiring immediate action exists, it will make best efforts to provide reasonable notice to a Settling Pharmacy prior to initiating any such action.

XV. COMPLIANCE CERTIFICATION

1. Kroger’s Controlled Substance Compliance Director, or the most senior ranking member of the Controlled Substance Compliance Committee shall, after diligent inquiry, complete an annual compliance certification on behalf of Kroger as set out in Section XV(4).

2. The certification shall be filed annually for the duration of these Injunctive Terms with a Settling State’s appropriate licensing and/or regulatory agency and its Attorney General.

3. The certification shall state:
“I understand the compliance requirements and responsibilities as they relate to [insert name of department], an area under my supervision. My job responsibilities include attempting to achieve compliance with regard to the [insert name of department] with all applicable statutory requirements, obligations of the Injunctive

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Terms, and applicable policies, and I have taken steps to promote such compliance. To the best of my personal knowledge, the [insert name of department] is in compliance with the obligations of these Injunctive Terms. I understand that this certification is being provided to and relied upon by the State of [Settling State].”

4. If the Controlled Substance Compliance Director is unable to provide such a certification, the Controlled Substance Compliance Director shall provide a written explanation of the reasons why he or she is unable to provide the certification outlined above.

XVI. DATA SHARING

1. Kroger shall consent to the provision by its distributors of Kroger’s unblinded “867 Data” (data sent from the distributor to the manufacturer concerning the sale of its products to Kroger) to opioid manufacturers on any particular Designated Controlled Substances manufactured by them as soon as commercially reasonable and at no cost to the manufacturers, provided that, pursuant to a prior written agreement with Kroger, the opioid manufacturers agree (a) to ensure the confidentiality of the 867 Data, except as required by law; (b) to implement safeguards and procedures to limit access to and use of the 867 Data, except as required by law; (c) that the 867 Data shall be used solely for compliance purposes as part of their Suspicious Order Monitoring programs; and (d) that the 867 Data shall be shared only with specified personnel and shall not be shared with business or sales personnel.

2. To the extent that Kroger provides McKesson Corporation, Cardinal Health, Inc., or AmerisourceBergen Corporation (the “Settling Distributors”) with Pharmacy Customer Data (as defined in the Distributor Injunctive Terms) for use in their Controlled Substance Monitoring Programs, Kroger agrees that the Settling Distributor(s) may share such Pharmacy Customer Data with the Monitor appointed pursuant to the Distributor Injunctive Terms, provided that the Monitor agrees, pursuant to a prior written agreement with Kroger, (a) to ensure the confidentiality of the Pharmacy Customer Data; (b) to implement safeguards and procedures to limit access to and use of the Pharmacy Customer Data; (c) that the Pharmacy Customer Data is used solely for the purpose of ensuring the Settling Distributors’ compliance with the Distributor Injunctive Terms; and (d) that the Pharmacy Customer Data shall be shared only with specified personnel.

XVII. CLEARINGHOUSE

1. Kroger will confer with any Settling Distributor that distributes Designated Controlled Substances to its retail pharmacies and the States Injunctive Relief Committee for a period not to exceed six (6) months from the Injunctive Terms Implementation Date to determine: what additional deidentified information, if any, is needed from Kroger for a Settling Distributor to perform suspicious order monitoring; if additional deidentified information is needed, how the Settling Pharmacy shall provide it to a Settling Distributor; and what information provided by

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Kroger to a Settling Distributor may be deposited by the Settling Distributor into the Clearinghouse. For the avoidance of doubt “deidentified” does not refer to Prescribers. If agreements are not reached, the matters in dispute shall be submitted to arbitration. Due to patient privacy and legal restrictions and other confidentiality and commercial concerns, in connection with any meet and confer described above, Kroger may not be compelled to provide individual patient-level or prescription-level data, de-identified or otherwise, to the Settling Distributors.

2. Kroger and Settling Distributors will also determine whether and in what amount each Settling Pharmacy will contribute to the cost of the operation of the Clearinghouse. When Kroger contributes to the costs of the Clearinghouse, Settling Pharmacy, Settling Distributors and all other participants in the Clearinghouse shall determine an equitable amount of Kroger’s contribution. If agreements are not reached, the matters in dispute shall be submitted to arbitration.

3. Any data provided by Kroger to a Settling Distributor and/or the Clearinghouse pursuant to these Injunctive Terms shall be treated in compliance with state and federal law, including but not limited to the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and all applicable state and federal privacy laws.

4. No Settling Distributor or other participant in the Clearinghouse shall receive from the Clearinghouse information specific to Kroger.

XVIII.FUTURE ACQUISITIONS

1. Kroger agrees to use reasonable best efforts to bring acquired pharmacies into compliance with these injunctive relief provisions in an expeditious manner. In the event that Kroger consummates its acquisition of Albertsons, then the parties shall discuss and agree within thirty (30) days of the transaction closing on a specific time period for bringing Albertsons into compliance with the terms of the injunctive relief provisions herein.

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APPENDIX A: INJUNCTIVE RELIEF RECORD RETENTION SCHEDULE Record Description Record Retention Period Controlling Injunctive Relief Provision
Injunctive Relief Records At least three (3) years, unless otherwise specified below I.4.d.

Telephone and Electronic Hotline
Complaints and Investigation
Documentation
Until November 15, 2032 IV.5.

Documentation and Records
Related to Resolution of all Red
Flags, Prescriptions Rejected
Pursuant to Red Flags, and
Reasons for Their Rejection
Until November 15, 2032 VIII.6.

Prescriber Review Process Data,
Information, and Documentation Until November 15, 2032 X.4.

Retail Pharmacy Compliance
Review Documentation Until November 15, 2032 XI.1.

Site Visit Review Documentation
and Reports Until November 15, 2032 XI.1-5.

Documentation Regarding the
Inventory of Designated
Controlled Substances
At least three (3) years, if the
information is an electronic record;
at least two (2) years, if the
information is not an electronic
record
XII.1.

Reports to Settling States
Regarding Fraudulent or Forged
Prescriptions
At least two (2) years XIII.2.

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EXHIBIT Q
[Intentionally Omitted]

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EXHIBIT R
Agreement on Attorneys’ Fees, Costs, and Expenses
This Agreement on Attorneys’ Fees, Costs, and Expenses (“Fee Agreement”) is entered between Kroger and the Plaintiffs’ Executive Committee appointed in the multidistrict litigation in the Northern District of Ohio, In re National Prescription Opiate Litigation, No. 1:17-MD-2804 (“MDL PEC”), in connection with the Kroger Global Opioid Settlement Agreement (“Kroger Agreement”). This Fee Agreement becomes effective on the Effective Date of the Kroger Agreement or the date that the Consent Judgments anticipated under the Kroger Agreement become final in 25 Settling States (whichever is later).

I. Definitions
A. This Fee Agreement incorporates all defined terms in the Kroger Agreement, unless otherwise defined herein, and shall be interpreted in a manner consistent with the Kroger Agreement.

B. “Applicant.” Any Attorney or MDL Participating Counsel who seeks an award of attorneys’ fees from the Attorney Fee Fund pursuant to the procedures established by the MDL Court and the Fee Panel.

C. “Attorney.” Any of the following retained through a legal contingency fee or hourly fee contract: a solo practitioner, multi-attorney law firm, or other legal representative of a Participating Subdivision or MDL Participating Counsel. This does not include Subdivision in-house attorneys.

D. “Attorney Fee Fund.” An account consisting of up to $88,800,000.00 allocated to pay attorneys’ fees approved pursuant to Section II.B. of this Fee Agreement, established by Order of and under the ongoing jurisdiction of the MDL Court, as provided below.

E. “Common Benefit.” Work performed for the benefit of all Participating Subdivisions and Tribal Nations, including, but not limited to, pretrial matters, discovery, trial preparation, trial, settlement negotiations, and all other work that advances the interests of the Participating Subdivisions.

F. “Common Benefit Fund.” The sub fund of the Attorney Fee Fund described in Section II.C.

G. “Common Benefit Order.” The Ongoing Common Benefit Order (Dkt. #4428) in In re National Prescription Opiate Litigation, Case No. 1:17-md-2804, any subsequent amendments or modifications to that order, and any successor orders on Common Benefit.

H. “Contingency Fee Fund.” The sub fund of the Attorney Fee Fund described in Section II.D.

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I. “Cost and Expense Fund Administrator.” The administrator appointed by the MDL Court on August 12, 2021 (MDL Docket No. 3828), to administer the Cost Fund and its sub funds as provided in the Fee Agreement.

J. “Cost Fund.” An account consisting of $60,000,000, composed of the MDL Direct Cost Fund and the Subdivision Cost and Expense Fund, as provided below.

K. “Court Common Benefit Fund.” The Common Benefit Fund established by the MDL Court in its orders of July 22, 2021, MDL Docket No. 3794, and May 9, 2022, MDL Docket No. 4428.

L. “Eligible States.” The thirty-three (33) states of the United States listed in Exhibit F, and the District of Columbia.

M. “Fee Entitlement.” Any right, entitlement, or expectation, including but not limited to a fee contract, contingent fee contract, agreement, referral arrangement, co-counsel arrangement, State Back-Stop Agreement, or any other arrangement by which counsel could receive compensation or other consideration. For the avoidance of doubt, the scope of Fee Entitlement under paragraph II.G.3.a. does not include any Attorneys’ fees associated with representation of a State.

N. “Fee Panel.” The three-person panel appointed by the MDL Court on August 12, 2021 (MDL Docket No. 3828), to administer and make recommendations for the allocation and distribution of the Attorney Fee Fund and its sub funds as provided in the Fee Agreement.

O. “Kroger.” The Kroger Co. and all of its respective past and present direct or indirect parents, subsidiaries, divisions, affiliates, joint ventures, predecessors, successors, and assigns.

P. “Kroger Bellwethers.” Kroger Bellwethers include any designated bellwether case in MDL 2804 that resolves its claims with Kroger under the Kroger Settlement Agreement, including Montgomery County Board of County Commissioners et al. v.

Cardinal Health, Inc., et al., Case No. 1:18-op-46326, County of Cobb, Georgia v.

Purdue Pharma L.P.., et al., Case No. 1:18-OP-45817, County of Tarrant, Texas v.

Purdue Pharma L.P.., et al., Case No. 1:18-OP-45274, and County of Durham, North Carolina v. Purdue Pharma L.P., et al., Case No. 1:19-OP-45346.

Q. “Later Litigating State.” A State that first files and/or serves a lawsuit bringing a Released Claim against a Released Entity after February 14, 2024.

R. “MDL Court.” United States District Court for the Northern District of Ohio Eastern Division, Case No. 1:17-md-2804, Judge Dan Aaron Polster.

S. “MDL Expense Fund.” The cost fund described in Section II.F below.

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T. “MDL Participating Counsel.” MDL Participating Counsel includes an attorney or firm authorized by MDL 2804 Lead Counsel to perform work for the Common Benefit of Participating Subdivisions. By way of example, it would include insurance counsel and appellant counsel.

U. “MDL PEC.” The Plaintiffs’ Executive Committee appointed by the MDL Court.

V. “Non-Eligible State.” Any state or territory of the United States of America that is not an Eligible State.

W. “Non-Participating Litigating Subdivision.” A Litigating Subdivision that is not a Participating Subdivision.

X. “Non-Participating State.” An Eligible State that is not a Participating State.

Y. “Participating Litigating Subdivision.” A Litigating Subdivision that is also a Participating Subdivision.

Z. “Participation Agreement.” An agreement executed by an Attorney that acknowledges the obligation to pay an appropriate MDL Common Benefit Assessment.

AA. “Qualified Tribal Representation.” Representation by an attorney of a Participating Tribal Government regarding Released Claims against Released Entities. Such counsel are eligible for Common Benefit Fee consideration. The Kroger Tribal Global Settlement provides for the contribution to the Common Benefit Fund as shall be determined by the MDL Court.

BB. “Qualifying Representation.” Legal services provided for representation of the MDL PEC or a Participating Litigating Subdivision regarding Released Claims against Released Entities.

CC. “State Back-Stop Agreement.” Any agreement by a Settling State and private counsel for Participating Subdivisions in that State (or legislation enacted in that State) to provide, adjust, or guarantee attorneys’ fees and costs, whether from the Attorney Fee Fund or any other source recognized in the agreement or legislation.1 DD. “Subdivision Cost and Expense Fund.” The fund created to pay approved costs and expenses incurred by Attorneys engaged in Qualifying Representations of Subdivisions as set forth in Section II.E.

II. Fees and Costs
1 Nothing herein shall be understood to indicate approval for additional State Back-Stop Agreements or modifications of existing State Back-Stop Agreements.

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A. Total Attorneys’ Fees and Costs

1. Total attorneys’ fees and costs to be paid by Kroger to Attorneys under this Fee Agreement shall be up to, but in no event more than, $148,800,000.00, subject to the reductions and provisions set forth below. The total attorneys’ fees and costs consists of up to $88,800,000 for the Attorney Fee Fund, as set forth in Section II, and $60,000,000 in total for the Cost Fund, divided between the Subdivision Cost and Expense Fund and MDL Expense Fund. The Maximum Attorney Fees, subject to the reductions set forth herein, are $88,800,000 and shall be paid on the schedule in Ex. M-3.

2. If an Eligible State does not join the Agreement by the State Participation Date and is accordingly not a Settling State, the total attorneys’ fees and costs to be paid under this Fee Agreement by Kroger shall be reduced by twelve point four percent (12.4%) times the Remediation Payment amount that would have been allocated to that Non-Settling State as set forth in Section IV.B of the Kroger Agreement.

3. The total attorneys’ fees and costs to be paid under this Fee Agreement by Kroger shall also be reduced by the amount of the Contingency Fee Fund for Attorneys representing Litigating Subdivisions in any Settling State that do not participate in the Kroger Agreement (“Non-Participating Litigating Subdivisions”), as set forth in Section II.D.4 and II.H.7 below. Any reduction or credit will be applied to the last payment under this Agreement.

4. If Kroger settles with any Non-Settling State after September 8, 2023, and such settlement allows for the Subdivision(s) in such Non-Settling State to join the settlement, Kroger agrees to withhold from the gross recoveries a Common Benefit Fund assessment, to be deposited in the Court Common Benefit Fund, of 7.5% times the gross recovery paid as defined in the Court Common Benefit Order (Docket #4428). If Kroger settles with any Subdivision(s) in a NonSettling State other than in connection with a statewide settlement that includes the relevant State after September 8, 2023, then Kroger agrees to withhold from the gross recoveries a Common Benefit Fund assessment, to be deposited in the Court Common Benefit Fund, of 7.5% times the gross recoveries (the “Kroger Subdivision CBF Assessment,” and, along with the Kroger State Settlement CBF Assessment, each a “Kroger CBF Assessment”). If (a) Kroger settles with a Non-Settling State after November 1, 2023, (b) such settlement does not allow for the Subdivision(s) in such Non-Settling State to join the settlement, and (c) Kroger later prevails in asserting that Released Claims of Primary Subdivisions in such Non-Settling State were released as a result of such settlement, Kroger agrees to deposit the Kroger State Settlement CBF Assessment in the Common Benefit Fund. Any Kroger CBF Assessment is inclusive of any assessment related to such settlement that would be required by the Common Benefit Order (Docket #4428).

B. Attorney Fee Fund and Sub Funds

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1. The Attorney Fee Fund shall consist of the Contingency Fee Fund and the Common Benefit Fee Fund. There shall be a split of the Attorney Fee Fund into the Contingency Fee Fund and the Common Benefit Fund. The split shall be 40% to the Contingency Fee Fund and 60% to the Common Benefit Fund, provided the Contingency Fee Fund shall pay a Contingency Fee of the lesser of the Contingency Fee Contract amount, or 20% of client recovery. Any excess Contingency Fee Fund monies shall revert to the Common Benefit Fund.

2. The Cost Fund shall include the MDL Expense Fund and the Subdivision Cost and Expense Fund. The State Counsel Fee Fund and the State Cost Fund shall be separate funds under the control of the Settling States.

3. It is the intention of the Parties that the Contingency Fee Fund and the Common Benefit Fund shall be administered by the Fee Panel appointed under MDL Docket No. 3828, which will be governed by the provisions of this Fee Agreement and shall design the process and procedures for the allocation of fees pursuant to this Fee Agreement and the MDL Court’s Orders. The Cost Funds shall be administered by the Cost and Expense Fund Administrator appointed under MDL Docket No. 3828, who will be governed by the provisions of this Agreement and shall design the process and procedures for the allocation of costs pursuant to this Agreement and the MDL Court’s Order.

4. The fees to be paid under this Fee Agreement are available for Attorneys engaged in Qualifying Representations and Qualified Tribal Representations only. Fees to be paid under this Fee Agreement are not available prior to the Effective Date of the Kroger Agreement. Fees to be paid under this Fee Agreement are not available for representation of Non-Participating Subdivisions, or Non-Litigating Subdivisions and are not available for representation of private hospitals, third-party payors, NAS claimants, personal injury/wrongful death claimants, or any entity other than Participating Litigating Subdivisions. In addition, fees under this Fee Agreement are not available for representation of any individual or entity in matters other than those claims against Released Entities, but may include a reasonable share of representations that involve development of facts for pursuit of opioid-related claims against multiple defendants in the pharmacy, manufacturing, and distribution chain.

5. In no event shall Kroger be required to pay more into the Attorney Fee Fund than the maximum amount specified in paragraph II.A.1. The amounts allocated to the Contingency Fee Fund and the Common Benefit Fund set by the Fee Panel shall be subject to the reductions set forth in Section II.A.2 and the reductions and refunds set forth below.

6. Awards of fees from the Contingency Fee Fund shall be available to Attorneys with Qualifying Representations of Participating Litigating Subdivisions eligible to receive an allocation under the Kroger Agreement, as set forth in Exhibit G to the Kroger Agreement, and shall be made by applying the

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Mathematical Model attached as Exhibit “A” to this Fee Agreement. The collection of the data and calculations for the Mathematical Model has been a cooperative effort among private counsel for a large number of Litigating Subdivisions. The analysis has been spearheaded by Joseph Tann and Andrew Arnold. The Fee Panel is encouraged to continue working with those counsel in application of the Model. The Fee Panel shall oversee the application of the Model and resolve any questions or disputes concerning the eligibility of a Counsel to participate as required in Section II.G. The Panel is empowered to hear disputes concerning and ensure the accuracy of the mathematical calculation.

7. As to awards from the Contingency Fee Fund, there shall be no right of appeal.

8. Any appeal of an award of the Fee Panel from the Common Benefit Fund will be made to the MDL Court and be reviewed under an abuse of discretion standard.

C. Common Benefit Fund (60% of the Attorney Fee Fund)

1. The maximum potential total Common Benefit Fund payment to be made by Kroger into the Attorney Fee Fund is $53,280,000, and in no event shall it exceed that amount. Kroger’s maximum potential Common Benefit Fund payments are subject to the reductions set forth in Section II.A.2. for NonSettling States and to the adjustments set forth below and, subject to those reductions, shall be paid on the following yearly schedule:

Kroger Shall Pay Common Benefit
Year 1
March 31, 2024 $8,880,000
Year 2
March 31, 2025 $8,880,000
Year 3
March 31, 2026 $8,880,000
Year 4
March 31, 2027 $8,880,000
Year 5
March 31, 2028 $8,880,000
Year 6
March 31, 2029 $8,880,000
Total

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2. The Common Benefit Fund shall be available to compensate Attorneys engaged in Qualifying Representations of Participating Litigating Subdivisions and Qualified Tribal Representation of Tribal Participating Governments who:
a. have performed work for the Common Benefit of all Participating Subdivisions and/or Tribal Nations consistent with the provisions to the guidelines established by Judge Polster set forth in MDL 2804 and the Order dated May 1, 2018, under docket number 358, which is included herein by reference; and
b. satisfy the eligibility criteria set forth in Section II.G.

For purposes of Common Benefit Fund distribution, notwithstanding paragraph II.A.5, Attorneys representing Tribal Nations litigating against Kroger have also reached a settlement for Released Claims with Kroger, and these settlements are the subject of agreements with Kroger. Attorneys are eligible for Common Benefit consideration provided such agreement with Kroger became effective under their terms. Such Attorneys must meet the eligibility criteria in Section II.G.

For purposes of Common Benefit Fund distribution, notwithstanding paragraph II.A.5, MDL Participating Counsel not engaged in Qualifying Representations of Participating Litigating Subdivisions but who performed work for the Common Benefit pursuant to authorization from the MDL Co-Leads and meet the eligibility criteria in Section II.G. shall be eligible.

3. Kroger’ Common Benefit Fund payments under this Fee Agreement satisfy any assessments or withholdings for the Kroger Agreement that are or could be required under the Common Benefit Order for Settling States and their Participating Subdivisions. The Common Benefit Fund shall be overseen by the Fee Panel, which shall determine the allocation of funds to eligible Attorneys consistent with this Fee Agreement and the Common Benefit Order.

4. In assessing the benefits that an Applicant has conferred to Participating Subdivisions (including non-Litigating Subdivisions) and/or Tribes for purposes of any compensation decision, the Fee Panel shall give significant weight to the extent to which (i) the Applicant and his or her clients have contributed to increasing (or reducing) Subdivision Participation in the Kroger Agreement as of the Initial Participation Date, and (ii) the Applicant and his or her clients have contributed to increasing (or reducing) the amounts achieved under Incentive Payments A-D through participation in the Kroger Agreement, including the Kroger Tribal Agreement. The Fee Panel shall also consider additional fee recoveries the Applicant may potentially obtain, including, but $53,280,000

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not limited to, from attorney fee funds under other settlement agreements, State Back-Stop Agreements, representations of States or Tribal Nations, representations of other clients in opioids-related matters, or through the representation of Subdivision clients, whether they participated in the Kroger Agreement or not. It is the intent of this provision to recognize that the goal of the Kroger Agreement is to provide for maximum participation by the Subdivisions, maximum abatement funding for all Subdivisions nationally, and the maximum peace for Released Entities. Therefore, representing one or more Non-Participating States or Non-Participating Subdivision does not further the goal of the Kroger Agreement, and should not be considered Common Benefit because it does not increase funds available to Participating Subdivisions’ abatement programs. Representing one or more Later Litigating Subdivisions or Later Litigating States is antithetical to the Kroger Agreement and detracts from Common Benefit; the Fee Panel shall consider this concept of “common detriment” set forth in this paragraph in all of its decision making with respect to the allocation of the Attorney Fee Fund among Applicants, as well as, in its discretion, any reductions provided to Kroger as set forth in Section II.H. The Fee Panel shall consider the totality of the Applicant’s Participating Litigating Subdivisions as compared to the Applicant’s Non-Participating Litigating Subdivisions; the Parties recognize that, although the goal is for 100% participation, Applicants with a greater number of clients have a greater probability of having one or more Non-Participating Litigating Subdivisions.

As used in this paragraph II.C.4, “client” or “representing” a Subdivision shall include any Litigating Subdivision as to which the Applicant has a Fee Entitlement.

5. As set forth in Section II.H, the Fee Panel must consider the factors described in paragraph II.C.4 to determine how and whether to reduce the amounts to be paid by Kroger under this Fee Agreement and to determine how to allocate funds among Applicants. They may also, at their discretion, consider other factors. Any reduction in payment obligation or credit to be given Kroger in this Fee Agreement shall be applied against the last Payment Year and then working backwards. Any reduction to an Applicant not credited to Kroger shall be allocated to attorneys whose Litigating Subdivision clients participated in the settlement by the Initial Participation Date.

D. Contingency Fee Fund (40% of the Attorney Fee Fund)

1. The maximum potential total Contingency Fee Fund payment to be made by Kroger into the Attorney Fee Fund is $35,520,000, and in no event shall it exceed that amount. Kroger’ maximum potential Contingency Fee Fund payment shall be subject to the reductions set forth in Section II.A.2 for NonSettling States and to the adjustments set forth below and, subject to those reductions, shall be paid on the following yearly schedule:

Kroger Shall Pay Contingency Fee Fund

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Year 1
March 31, 2024 $5,920,000
Year 2
March 31, 2025 $5,920,000
Year 3
March 31, 2026 $5,920,000
Year 4
March 31, 2027 $5,920,000
Year 5
March 31, 2028 $5,920,000
Year 6
March 31, 2029 $5,920,000
Total $35,520,000

2. The Contingency Fee Fund shall be available to compensate Attorneys engaged in Qualifying Representations of Participating Litigating Subdivisions that meet the criteria set forth in Section II.G.
a. The Contingency Fee Fund shall be available to Attorneys who represent Litigating Subdivisions that are Participating Subdivisions, whether their actions are filed in state or federal court, and meet the eligibility criteria of Section II.G.
b. Participation in the Contingency Fee Fund by counsel that have a case that is not subject to the jurisdiction of the MDL Court shall not create, provide, or waive jurisdiction of the MDL Court over that Litigating Subdivision, that case or Attorneys, other than to oversee the fairness of the distribution process, and enforcement of this Fee Agreement.

3. The amount owed by Kroger to the Contingency Fee Fund shall be reduced to reflect the non-joinder of Litigating Subdivisions in Settling States by subtracting the amounts identified by the Fee Panel, pursuant to paragraph II.H.7, that would have been owed to counsel for Non-Participating Litigating Subdivisions in Settling States had such Litigating Subdivisions been Participating Subdivisions.

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4. In the event that after the date of the Kroger Agreement, Kroger, prior to the Effective Date of the Kroger Agreement, settles with any Litigating Subdivision that would have been eligible to participate in the Settlement Agreement, and, under such settlement agreement pays attorneys’ fees, the Fee Panel shall treat those Litigating Subdivisions as Participating Litigating Subdivisions and, applying the same criteria applicable to all Attorneys for Participating Litigating Subdivisions, determine what amount they would have been paid from the Contingency Fee Fund if they had become Participating Subdivisions under the Kroger Agreement without such prior settlement. That sum, rather than being paid to the Attorney for the previously settling Litigating Subdivision, shall be credited to Kroger, except that such refund shall not be greater than the amount paid to the Attorneys under the Litigating Subdivision’s prior settlement agreement. All credits will be applied to the last Payment Year.

5. The Contingency Fee Allocation shall be determined as set forth in the Mathematical Model attached. If after application of the attached model funds remain in the Contingency Fee Fund, such funds shall be transferred to the MDL Common Benefit Fund established by Order of May 9, 2022 (Docket #4428).

E. Subdivision Cost and Expense Fund

1. Kroger shall pay $60,000,000 into the Subdivision Cost and Expense Fund on the schedule set forth below.

Cost Fund
Year 1
March 31, 2024 $10,000,000
Year 2
March 31, 2025 $10,000,000
Year 3
March 31, 2026 $10,000,000
Year 4
March 31, 2027 $10,000,000
Year 5
March 31, 2028 $10,000,000
Year 6
March 31, 2029 $10,000,000

2. The Subdivision Cost and Expense Fund shall be available to compensate Attorneys for costs and expenses arising out of Qualifying Representations of Participating Litigating Subdivisions. No funds in the Subdivision Cost and Expense Fund may be used to compensate the costs incurred by NonParticipating Subdivisions or Non-Litigating Subdivisions or costs and expenses arising out of representation of any such Subdivision.

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3. During the period between March 22, 2024 and the Effective Date of the Kroger Agreement, the MDL PEC, as well as Litigating Subdivisions eligible to claim costs from the Subdivision Cost and Expense Fund, shall make best efforts to cease litigation activity against Kroger, including by jointly seeking stays or severance of claims against Kroger, where feasible, or postponements if a motion to stay or sever is not feasible or is denied, so long as such actions are not otherwise detrimental to the Litigating Subdivision.

4. In the event that Kroger, prior to the Effective Date of the Kroger Agreement, settles with any Litigating Subdivision and, under such settlement agreement, pays costs to the Litigating Subdivision or its Attorney, the MDL Cost and Expense Fund Administrator shall treat those Litigating Subdivisions as Participating Litigating Subdivisions and, using the same criteria applicable to all applicants to the Subdivision Cost and Expense Fund, determine what amount in costs the Litigating Subdivision or its Attorney would have been paid from the Subdivision Cost and Expense Fund if they had settled under the Kroger Agreement. That sum, rather than being paid to the Attorney or the previously settling Litigating Subdivision, shall be credited and/or returned to Kroger, except that such sum shall not be greater than the amount paid under the previously settled Litigating Subdivision’s settlement agreement.

5. The Cost Fund shall be administered by the Cost Fund and Expense Fund Administrator (MDL Docket No. 3828), who will be governed by the provisions of this Agreement and shall design the process and procedures for the allocation of costs pursuant to this Agreement and the MDL Court’s Order.

6. The costs of the Cost and Expense Fund Administrator shall be paid from the Cost Fund and allocated by the Cost and Expense Fund Administrator between the MDL Direct Cost Fund and the Subdivision Cost and Expense Fund to fairly charge each fund the cost incurred in implementing and supervising the specific fund.

7. The Cost and Expense Fund Administrator shall set the process and procedures for submission of and criteria for applications for payment of Subdivisions’ costs and expenses incurred by Attorneys engaged in Qualifying Representations. The Cost and Expense Fund Administrator shall receive and evaluate applications from Attorneys for the Participating Litigating Subdivisions, whether filed in Federal Court or State Court, to seek reimbursement for eligible costs under Section II.E.2 in pursuit of claims asserted in MDL 2804. The process shall require a showing that the costs or expenses sought were reasonably incurred in furtherance of active litigation of a designated state or federal bellwether trial-set case, or Common Benefit. The Cost and Expense Fund Administrator shall require transparency from all applicants as to any other sources for compensating Attorneys for Subdivisions for costs incurred. If funds remain after the reimbursement of approved out-ofpocket costs, the Cost and Expense Fund Administrator shall consider reasonable and appropriate payment to the Kroger Bellwethers for client time,

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costs and expenses. In addition the Cost and Expense Fund Administrator shall have the authority to award additional abatement proceeds to the Kroger bellwethers not to exceed: $20 million for Montgomery, $11 million for Durham, $11.5 million for Cobb County, and $9.5 million for Tarrant County, as additional abatement proceeds. The Administrator shall take into account like payments from other settlement funds when making its determination under this provision. At the conclusion of the process, any funds not allocated by the Cost and Expense Fund Administrator shall be transferred to the MDL Expense Fund for reimbursement of expenses determined and approved at the discretion of the Administrator. If any funds remain thereafter they shall be transferred to the MDL Common Benefit Fund.

8. In the event that States and Subdivisions enter into an additional global settlement with a party or parties other than Kroger that is (a) under the jurisdiction of the MDL Court in MDL No. 2804, (b) creates a separate cost fund, and (c) unless the parties agree to another date, such agreement has an effective date prior to December 31, 2024, the Cost and Expense Fund Administrator shall have the authority to aggregate the Cost Fund with the cost fund created under that global settlement agreement. The Cost and Expense Fund Administrator shall have the authority to address the appropriate procedures and required information to allow the costs to be funded from the appropriate cost fund or shared by two or more cost funds; provided, however, that the Subdivision Cost and Expense Fund shall remain subject to the requirements set forth in Section II.E.2. For the avoidance of doubt, payment of Subdivision Costs and Expenses to Attorneys is available only to compensate Attorneys for costs and expenses arising out of representation of Participating Litigating Subdivisions, and no funds in the Subdivision Cost and Expense Fund may be used to compensate Attorneys for the costs incurred by NonParticipating Subdivisions or Non-Litigating Subdivisions or costs and expenses arising out of representation of any such Subdivision.

F. MDL Expense Fund

1. Kroger shall pay $5,000,000 of the Subdivision Cost and Expense Fund Year 1 payment into the MDL Expense Fund on the schedule set forth below.

MDL Expense
Fund
Year 1
March 31, 2024 $5,000,000

2. The MDL Expense Fund shall be released following the Effective Date of this Fee Agreement without any delay to reimburse the MDL PEC for an agreed-to portion of the expenses incurred, as approved by the Cost and Expense Fund Administrator. The sum deposited into the MDL Expense Fund will be paid

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directly to the MDL Opiate Capital Account. No funds may be used to compensate the costs incurred by Non-Participating Subdivisions or NonLitigating Subdivisions, or to compensate any Attorney for costs incurred in representing one or more Non-Participating Subdivisions or Non-Litigating Subdivisions. Should the approved MDL Costs and Expenses be less than $5,000,000, the balance shall go to the Subdivision Costs and Expenses Fund.

3. In allocating the MDL Expense Fund, the Administrator shall not allocate any funds for costs incurred after the Effective Date of the Settlement, unless the Administrator determines that there are sufficient funds to cover all Subdivision costs incurred by the MDL prior to the Effective Date and that costs were in pursuit of Abatement recovery for Litigating Subdivisions incurred following the public announcement of the Kroger Agreement, including reasonable costs related to the implementation of the Kroger Agreement.

4. At the conclusion of the Opioid MDL 2804 any funds remaining in the MDL Cost & Expense Fund shall be transferred to the MDL 2804 Common Benefit Fund (Dkt #5100).

G. Eligibility

1. It is the intention of all parties participating in the Fee Panel process that there should be total transparency to the Fee Panel and to all fund participants. In connection with the process to be developed by the Fee Panel, any and all monies in attorney’s fees received or awarded, including prior or future Contingency Fees, Common Benefit Fees, referral fees, expenses paid, promises for payment, or any other Fee Entitlement, to any Applicant in any opioid litigation shall be disclosed to the Fee Panel as a condition of participating in the Attorney Fee Fund and prior to an award from the Fee Panel.

Any payment, expectation of payment or perceived entitlement to participate in a State Back-Stop Agreement or any other agreement reached with a Settling State or any Subdivision or any other source regarding payment of fees must be disclosed to the Fee Panel. Similarly, any right to payment from any other fund, for example a fund for payment to lawyers representing Settling States or Tribal Nations or Subdivisions shall be disclosed to the Fee Panel. Because it is anticipated that there will be multiple firms listed on contingent fee agreements with Litigating Subdivisions, the Fee Panel shall establish procedures, with input from Attorneys for Participating Litigating Subdivisions, for which party or parties should petition for fees from such groups and to whom the fee shall be paid and thereafter distributed to co-counsel in accordance with applicable agreements. For the avoidance of doubt, all Attorneys that are part of such groups must meet the eligibility criteria in paragraph II.G.3, must be subject to the criteria set forth in paragraph II.C.4, and must be disclosed to the Fee Panel.

2. An Applicant may apply for and recover attorneys’ fees from the Common Benefit Fund, the Contingency Fee Fund, and any fund created by a past or future State Back-Stop Agreement, provided the Applicant satisfies the

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requirements relevant to each such fund and requirements for disclosure to the Fee Panel.

3. An Attorney may not receive any payment from the Attorney Fee Fund (which includes both the Contingency Fee Fund and the Common Benefit Fund) unless the following eligibility criteria are met and annually certified by the Attorney:
a. The Attorney must expressly waive the enforcement against the Participating Litigating Subdivision client of all Fee Entitlements (other than under State Back-Stop Agreements) arising out of or related to any or all Qualifying Representations of any Participating Litigating Subdivision prior to applying for attorneys’ fees from the Attorney Fee Fund. All applications for attorneys’ fees under this Fee Agreement shall include an affirmation by the Attorney of such waiver and notice to the client(s) of such waiver. Such waiver shall not preclude the Attorney from submitting such Fee Entitlements to the Fee Panel as a factor for consideration in allocating payments from the Attorney Fee Fund or in connection with a State Back-Stop Agreement. For the avoidance of doubt, no Attorney may recover fees under this Fee Agreement unless the Attorney expressly agrees not to enforce Fee Entitlements as to each and every Participating Litigating Subdivision represented by that Attorney, but such Attorneys may participate in and receive funds from a State Back-Stop Agreement. b. The Attorney must represent that s/he has no present intent to represent or participate in the representation of any Later Litigating Subdivision or Later Litigating State, including a Non-Eligible State or a subdivision in a NonEligible State, with respect to Released Claims against Released Entities. c. The Attorney must represent that s/he has not and will not engage in any advertising or solicitation related to Released Claims against Released Entities where such advertising or solicitation relates to a representation of a Subdivision eligible to be a Participating Subdivision after the Reference Date unless the Attorney is recommending participation in the Agreement. d. The Attorney must represent s/he will not charge or accept any referral fees for any Released Claims brought against Released Entities by Later Litigating Subdivisions or Later Litigating States. This representation shall not prohibit Attorneys from receiving allocated shares of any future common benefit assessments arising out of settlements or judgments with Later Litigating Subdivisions or Later Litigating States that are the result of the MDL Court’s Common Benefit Order.
e. The Attorney may not have and must represent that s/he does not have a Fee Entitlement related to a Later Litigating Subdivision or Later Litigating State, including a Non-Eligible State or a subdivision in a Non-Eligible State, other than a potential Common Benefit Fee.

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f. The Attorney must fully disclose the participation, or the anticipation of participation, in any agreement with a Settling State or Participating Subdivision concerning fees arising out of or related to the Kroger Agreement, including any fees paid or anticipated to be paid or any State Back-Stop Agreement.
g. The Attorney must identify for the Fee Panel whether s/he utilized state litigation work product or MDL work product, including but not limited to ARCOS data, document repositories, experts developed in the MDL, trial transcripts, or deposition transcripts. The Attorney must identify whether s/he signed the MDL Participation Agreement.
h. Any Attorney who applies for fees from one or both Funds must represent that, having exercised his/her independent judgment, s/he believes the Kroger Agreement to be fair and will make or has made best efforts to recommend the Agreement to his or her Subdivision clients in Settling States. For avoidance of doubt, each Attorney is expected to exercise his or her independent judgment in the best interest of each client individually before determining whether to recommend joining the settlement. All applications for attorneys’ fees or costs under this Section shall include an affirmation by the Attorney in compliance with this Subsection.

4. No Attorney receiving fees under this Fee Agreement may apply for or recover from the Attorney Fee Fund fees arising from representing a Non-Settling State or a Non-Participating Subdivision, provided, however, that this provision is not intended to prohibit Attorneys who do not represent or otherwise have a contractual agreement with such Non-Settling State or Non-Participating Subdivision from receiving allocated shares of any future common benefit assessments that arise out of settlements or judgments involving such NonSettling State or Non-Participating Subdivision. All applications for attorneys’ fees under this Section shall include an affirmation by the Attorney of compliance with this Section.

5. An Attorney who has filed an application under this section and received an award of attorneys’ fees shall provide a certification of compliance with the Sections of this Fee Agreement annually during the years upon which they are still entitled to receive attorneys’ fee payments under this Agreement. This certification will be done as directed by the Panel.

6. If, at any time, the Attorney is unable to make the representations set forth in this Section, such representations become untrue, or the Attorney falsely represents compliance with the eligibility criteria, the Attorney shall cease to be eligible to receive funds from the Attorney Fee Fund until further review by the Fee Panel of the Attorney’s eligibility under and compliance with this Section II.

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7. If an Attorney has a Fee Entitlement with a Later Litigating Subdivision or Later Litigating State, including a Non-Eligible State or a subdivision in a NonEligible State, or otherwise becomes unable to reaffirm compliance with the eligibility criteria set forth above, the Attorney shall notify the Fee Panel. For the avoidance of doubt, any Attorney who undertakes any new representation of, or has a Fee Entitlement with, a Later Litigating Subdivision or Later Litigating State, including a Non-Eligible State or a subdivision in a NonEligible State, shall be prohibited from receiving any future funds from the Attorney Fee Fund and be subject to additional obligations as set forth in Subsection 8 below. If an Attorney fails to notify the Fee Panel of such Fee Entitlement with a Later Litigating Subdivision or Later Litigating State, including a Non-Eligible State or a subdivision in a Non-Eligible State, the Attorney shall be required to refund amounts previously paid. The Fee Panel shall notify Kroger when it receives notification.

8. To the extent an Attorney who has received compensation from the Attorney Fee Fund based on Qualifying Representations of Participating Litigating Subdivisions under the Kroger Agreement represents a Later Litigating Subdivision or Later Litigating State, including a Non-Eligible State or a subdivision in a Non-Eligible State, such Attorney shall be obligated to refund such amounts received as compensation from the Attorney Fee Fund to Kroger.

Kroger or such Attorney may bring any dispute as to whether such Attorney shall be obligated to refund such amounts received from the Attorney Fee Fund to Kroger, to the Fee Panel. Nothing herein shall require a multi-attorney law firm that has received compensation from the Attorney Fee Fund to refund such amounts if an attorney of the firm that is no longer affiliated with such law firm, after such departure, represents a Later Litigating Subdivision or Later Litigating State, provided that (a) neither the law firm nor any of its other attorneys have any contractual or financial arrangement regarding, stand to benefit directly or indirectly from, or directly or indirectly provide financial or other support of any kind to, the former attorney’s representation of the Later Litigating Subdivision or Later Litigating State and (b) if the former attorney was a partner or owner of the multi-attorney law firm at the time that the law firm received compensation from the Attorney Fee Fund, the former attorney shall be obligated to refund such amounts as the former attorney earned as a result of the compensation that the law firm received from the Attorney Fee Fund.

9. In the event that an Attorney is deemed ineligible by the Fee Panel (whether based on its initial application or subsequent recertification), the Fee Panel shall provide notice to the Attorney and give the Attorney 30 days to provide additional information such that the Fee Panel could re-consider the Attorney’s eligibility.

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10. To the extent that an Attorney has a Fee Entitlement with a Participating Subdivision and is authorized to bring Released Claims against Released Entities, but such authorization is, in scope, less broad than the category of Released Claims set forth in the Kroger Agreement, such Attorney may participate fully in both the Contingency Fee Fund and the Common Benefit Fund, without any reduction imposed by the Fee Panel due to the scope of the authorization, so long as the Participating Subdivision fully releases all Released Claims against Released Entities.

11. Attorneys applying to the Attorney Fee Fund knowingly and expressly agree to be bound by the decisions of the Fee Panel, subject to the limited appeal rights set forth in this Fee Agreement, and waive the ability to assert the lack of enforceability of the allocation reached through the procedures outlined herein.

12. Applicants are under an ongoing obligation to inform the Fee Panel in writing of any additional fees earned, expected, or received related to any Opioid litigation throughout the period of the Fee Panel’s operation.

H. Calculation of Amounts Due

1. The Fee Panel shall be solely responsible for determining the amount of fees to be paid to each Applicant. None of the Released Entities shall have any responsibility, obligation, or liability of any kind whatsoever with respect to how attorneys’ fees are calculated under this Section, except that the Fee Panel may receive information from Kroger as to (a) the identity of Participating, Non-Participating, Litigating, Later Litigating, and Non-Litigating Subdivisions; (b) the impact of non-participation by a Litigating Subdivision as is relevant to the Fee Panel’s determination in paragraph II.C.4; and (c) such other information as Kroger may voluntarily elect to provide.

2. The Fee Panel shall establish procedures for making determinations under this Fee Agreement consistent with this Fee Agreement and orders of the MDL Court. Such procedures may include submission of documentary and/or other evidence, interviews with Applicants and/or other counsel (including counsel for Kroger) that the Fee Panel deems appropriate, and/or other means of creating a record upon which fee awards will be based.

3. In making determinations under this Fee Agreement, the Fee Panel must apply the eligibility criteria set forth in Section II.G of this Fee Agreement and the criteria set forth in Section II. The Fee Panel shall ensure that payments are only made for Qualifying Representations of Participating Litigating Subdivisions. In addition, the Fee Panel will give consideration in regard to Common Benefit Fund awards to the Johnson factors, as well as the following factors (which factors may be applied and given relative weight in the Fee Panel’s discretion):

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a. The Applicant’s contemporaneously recorded time and labor dedicated to Qualifying Representations along with the Applicant’s financial commitment to such Qualifying Representations. Claimed “time” will not be automatically accepted by the Fee Panel but will be critically reviewed and given substantially more weight and consideration if such time was subject to the audit process described in any Pretrial Order(s) governing the collection of common benefit time;
b. The novelty, time, and complexity of the Qualifying Representations; c. The skill requisite to perform legal services properly and undesirability of the case;
d. The preclusion of other employment by the Applicant due to time dedicated to Qualifying Representations;
e. The Common Benefit, if any, alleged to have been conferred by the Applicant and whether such Common Benefit work product by that Applicant was used by others in parallel litigations against Released Entities whether within or outside the MDL, provided that any Applicant claiming that s/he substantially benefited cases other than those in which s/he entered an appearance as counsel must substantiate such claims by proffering factual support, such as proper supporting affidavits or other documents as determined by the Fee Panel with input from Attorneys for Participating Litigating Subdivisions;
f. Any “common detriment,” as set forth in paragraph II.C.4; g. Any contingent fee agreement or other Fee Entitlement with Participating Subdivisions, enforcement of which, except for State Back-Stop Agreements, are waived in conjunction with the application, the nature and extent of any work for those Participating Subdivisions, whether such Participating Subdivisions actively litigated and, if so, the nature and procedural history of such case(s);
h. The experience, reputation, and ability of the Applicant; i. Whether the Applicant’s clients brought Released Claims against Released Entities;
j. The status of discovery in cases primarily handled by the Applicant; k. The nature of any work by the Applicant on “bellwether” cases or cases that were similarly active in litigation;

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l. Any pressure points successfully asserted by the Applicant in cases against Kroger or any risk for Kroger created by the Applicant in cases against Kroger;
m. Any risk for defendants created by Applicants in cases against Kroger; n. Successful and unsuccessful motion practice in cases worked on by the Applicant;
o. The date of filing of any cases filed by the Applicant; p. Obtaining consolidation of the litigation in the Applicant’s jurisdiction; q. The number and population of entities represented by the Applicant and the fees that would have been awarded under extinguished contingent fee arrangements;
r. Whether the Applicant’s clients brought claims against Kroger prior to the announcement of this settlement on September 8, 2023;
s. Whether the Applicant has had a leadership role in the litigation, whether in state or federal court;
t. Whether the Applicant has had a leadership role in any negotiations aimed at resolving the litigation;
u. Whether the Applicant’s cases have survived motions to dismiss; v. The extent to which the Applicant contributed to the work product used for the common benefit of opioids litigants, including, without limitation, work on ARCOS data, Prescription Data Monitoring Programs, IQVIA data, depositions, document production and analysis experts, motions, briefs and pleadings, trial preparations, and trials;
w. The extent to which litigation occurred prior to and contributed to completion of settlement negotiations, as distinct from litigation that occurred after the announcement of the Kroger Agreement on September 8, 2023, such latter litigation both being of less value and, the case of litigation filed after the announcement of the Kroger Agreement on September 8, 2023, resulting in a common detriment to the settlement process, which in both cases should be viewed less favorably; and
x. Any other factors that the Fee Panel finds to be appropriate to consider after input from Applicants to the Attorney Fee Fund.

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4. It is possible that the States and Subdivisions that are litigating Opioid cases will enter additional settlements in close proximity of the time for processing the Kroger Agreement. If there are additional settlements and these settlements create a Common Benefit Attorney Fee Fund to be administered by the Fee Panel, the Fee Panel may:
a. Consolidate the Common Benefit approval process to include evaluation of all Common Benefit Applications for all settlements entered after November 14, 2022;
b. Determine the fair and equitable allocation of the Aggregate Common Benefit Fees that come after December 9, 2022, including consideration of beneficial or detrimental actions taken with respect to any Settling Defendant contributing to the Common Benefit Attorney Fee Fund; c. Give consideration to the amount and timing of each settlement, including the amount and timing of Common Benefit Fees;
d. The Fee Panel shall abide by the applicable Attorney Fee Agreement in each of the Settlements in Allocating the Common Benefit Fees provided for in the Settlement; and
e. Be guided in their work by the Orders of the Court related to Fees and Costs.

5. The Fee Panel shall develop procedures for receiving a single application, which may be updated or amended based on new information (such as participation by additional Litigating Subdivisions) from each Applicant seeking compensation from each sub fund of the Attorney Fee Fund pursuant to processes and procedures developed by the Fee Panel, which shall not be inconsistent with this Fee Agreement. Any request for attorneys’ fees not included on the single application or through the updating/amendment process designed by the Fee Panel shall be deemed waived. For purposes of transparency and to permit the Fee Panel to conduct its work, the application from each Applicant shall, at a minimum, require each Applicant to:
a. Identify all Litigating Subdivisions for which s/he is seeking payment from the Attorney Fee Fund;
b. Identify all Subdivisions in both Settling and Non-Settling States (and, where applicable, Tribal Nations) with respect to which s/he has a Fee Entitlement with respect to Relevant Claims against Released Entities, and identify all co-counsel in such cases;
c. Identify which of those Subdivisions are Participating Subdivisions and which are not (with similar information for Tribal Nations, where applicable);

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d. Specify the specific fund or funds within the Attorney Fee Fund from which the Attorney is seeking compensation;
e. Demonstrate his or her eligibility for compensation from the relevant sub funds within the Attorney Fee Fund pursuant to the criteria set forth for the relevant sub fund;
f. Identify any and all Fee Entitlements from representations of States, Tribal Nations, or other plaintiffs related to Released Claims against Released Entities or in opioids-related matters;
g. Notwithstanding “a-f” above, the Panel may consider a supplemental application if the Applicant shows good cause why circumstances exist that will lead to consideration for additional Common Benefit award. Examples would include, but are not limited to, an Applicant having Non-Participating Litigating Subdivision clients that subsequently become Participating Subdivisions, a Bar Date passes that increases participation or an Allocation Agreement is reached.

6. With respect to the Common Benefit Fund, the Fee Panel shall (subject to any applicable MDL Court Order):
a. Review the applications of all Applicants seeking compensation from the Common Benefit Fund, including determining eligibility for each Applicant as set forth in Section II.G.
b. Using criteria set forth in Sections II.C and II.G, allocate amounts from the Common Benefit Fund to eligible Applicants, including payment amounts for each Payment Year. In making such allocations, the Panel shall apply the principles set forth in paragraph II.C.5 to the amounts paid to Applicants with a Common Benefit Fee Entitlement.

7. With respect to the Contingency Fee Fund, the Fee Panel shall:
a. Review the applications of all Attorneys seeking compensation from the Litigating Subdivision Fee Fund, including determining eligibility for each Attorney as set forth in Section II.G.
b. Apply the Mathematical Model in Exhibit A.
c. Use such allocations to determine refund amounts owed to Kroger from the Attorney Fee Fund, and inform Kroger and the MDL PEC of all such adjustments.

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8. To the extent that there is a dispute about the calculations of the Fee Panel related to the amount that Kroger is required to pay (including application of any reductions or refunds under this Fee Agreement), such disputes shall be presented to the Fee Panel and any disputed funds be paid into/held in escrow.

The Fee Panel shall resolve such disputes expeditiously, with either Party having the right to seek review from the MDL Court.

9. For purposes of determination of fee or cost awards, allocations, reductions, and possible reversions under this Fee Agreement, unless specified otherwise a Subdivision will be considered a Non-Participating Subdivision if it is not a Participating Subdivision as of the deadline for the application for the fee at issue (or, if the determination does not involve a specific application, the date on which the record for such determination closes).

10. In the event that the Fee Panel, through the use of the Mathematical Model set forth in Exhibit A, allocates funds from the Contingency Fee Fund for an Attorney based on a Qualifying Representation of a Participating Litigating Subdivision and that Subdivision is in a Settling State in which the Consent Judgment has not been approved, such funds shall be placed into escrow until the Consent Judgment is approved, after which time they shall be released.

I. Miscellaneous

1. The Fee Panel shall charge an hourly rate approved by the Court. The PreEffective Date costs associated with the Cost and Expense Fund Administrator shall be paid from funds in the Cost Fund. Post-Effective Date, the cost of the Fee Panel shall be charged against the applicable Fee Fund based on allocation by the Fee Panel and shall not be otherwise funded by Kroger.

2. The MDL PEC will seek, and the Attorneys General for Settling States and the Kroger will not oppose, a Common Benefit Fee Order requiring an assessment of 7.5% on the gross recovery (by judgment or settlement) of any NonParticipating Subdivision that is subject to the federal court jurisdiction, represented by a MDL PEC firm, represented by any Attorney receiving fees from the Common Benefit Fund, represented by any Attorney that signed a Participation Agreement or had been paid in a case otherwise under the jurisdiction of the MDL Court.

3. The MDL PEC shall provide to Kroger information the PEC has that identifies Attorneys who represent Litigating Subdivisions who are not Participating Subdivisions and who have an obligation to pay a common benefit assessment, either due to the MDL Court’s orders or pursuant to a Participation Agreement.

4. The MDL PEC and Kroger agree that it is a conflict of interest for an Attorney that had represented a Participating Subdivision or Settling State to represent a Later Litigating Subdivision or Later Litigating State, including a Non-Eligible State or a subdivision in a Non-Eligible State. This Subsection shall be

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enforceable to the extent permitted by the equivalent to Rules 1.16 and 5.6 of the ABA Model Rules of Professional Conduct in the relevant jurisdictions.

The MDL PEC represents that it will comply with this provision in the case of the Kroger Agreement until the Effective Date of the Kroger Agreement, as well as thereafter, if the Kroger Agreement proceeds.

5. Participating Subdivisions agree to instruct their counsel to treat information, work product and expert materials as confidential under Rule 1.6 of the ABA Model Rules of Professional Conduct. Accordingly, an Attorney shall not share information or work product with, or experts or materials to, non-participants (other than the Attorney’s own current clients or their lawyers, consultants, experts or other representatives or agents), including Non-Eligible States or subdivisions in Non-Eligible States. However, nothing herein shall prevent MDL Leadership or PEC Counsel from fulfilling their obligations in any MDL and the MDL Court Order.

III. Miscellaneous
A. Termination. If the Kroger Agreement does not proceed past the Reference Date, whether because Kroger does not determine to proceed or for any other reason, this Fee Agreement shall be null and void, Kroger shall have no obligation to make any payments under this Fee Agreement, and Kroger and the MDL PEC shall take such steps as are necessary to restore the status quo ante.

B. MDL Court Consideration. This Fee Agreement shall be attached as an exhibit to the Kroger Agreement. This Fee Agreement shall also be submitted by Kroger and the MDL PEC to the MDL Court for approval pursuant to the motion and order that shall be attached.

1. In the event that the MDL Court, through an order, makes any change to the amounts potentially to be paid by Kroger under this Fee Agreement, makes any change to the Fee Panel’s consideration of the factors set forth in paragraph II.C.4, or any other material change to the draft Order attached as part of Exhibit B or the terms of this Fee Agreement, Kroger and the MDL PEC shall meet and confer concerning such changes. The MDL Court shall have no authority to increase the payments made by Kroger related to fees and costs beyond the amounts described in this Fee Agreement.

2. If Kroger and the MDL PEC are unable to reach agreement and revisions to this Fee Agreement, this Fee Agreement shall be null and void, Kroger shall have no obligation to make any payments under this Fee Agreement, and Kroger and the MDL PEC shall take such further steps as are necessary to restore the status quo ante.

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C. Amendment. Once the MDL Court has entered an order implementing this Fee Agreement, this Fee Agreement can only be amended by (1) written agreement of Kroger and the MDL PEC and (2) approval by the MDL Court.

D. Jurisdiction and Enforcement. The MDL Court shall have exclusive and ongoing jurisdiction over the enforcement and implementation of this Fee Agreement as set forth herein. The MDL PEC shall be the Authorized Party to enforce this Fee Agreement, as to the payment obligations of Kroger as set forth in this Fee Agreement and as to Attorneys making application to the Funds under this Fee Agreement. Solely for purposes of assessing or allocating common benefit fees, the MDL Court will continue to have jurisdiction over the work product developed in the MDL Court by and under the direction of the MDL PEC with respect to claims against Kroger, including data and documents, depositions, expert reports, briefs and pleadings; and the MDL Court’s protective orders, management orders, and other decisions regarding such discovery and other work product, including but not limited to, conditions on its use, will continue in full force and effect. Nothing in this paragraph authorizes the MDL Court to act contrary to this Agreement or to share any of the work product, or provides the MDL Court with jurisdiction over the Kroger Agreement.

1 EXHIBIT A
Description of Mathematical Model for the Allocation of the Contingency Fee Funds Kroger Settlement Agreement
This document describes the Mathematical Model for allocation of the Contingency Fee Fund described in Exhibit R (Agreement of Attorneys’ Fees, Costs, and Expenses) to the Kroger Settlement Agreement.1 Awards of fees from the Contingency Fee Funds shall be available to Attorneys with Qualifying Representations of Participating Litigating Subdivisions eligible to receive an allocation under the Kroger Settlement Agreement.2 A Fee Panel shall oversee the application of the Model and resolve any questions or disputes concerning the eligibility of a counsel to participate. The Panel is empowered to hear disputes concerning and ensure the accuracy of the mathematical calculations.

In general terms, allocation of the Contingency Fee Fund shall be made by (1) determining the amount of the Settlement Fund that is attributable to each Participating Litigating Subdivision; (2) making certain adjustmentsto these amounts based on when the Subdivision filed suit and the terms of the applicable fee contract; and (3) dividing the Contingency Fee Fund proportionately among counsel for each Participating Litigating Subdivision based on the amounts calculated in subpart 2.

To collect a fee award from the Contingency Fee Fund, a Participating Litigating Subdivision must have named Kroger (or any Released Entity) in its lawsuit. The total maximum amount of the Contingency Fee Fund in the Kroger Settlement Agreement is $35,520,000. 3 Allocation of the Contingency Fee Fund shall be made according to the following steps. These calculations are made only for purpose of determining the percentage share of the Contingency Fee Fund that Attorneys for each Participating Litigating Subdivision should receive, not for determining the dollar amount each Subdivision will receive. (1) For each Settling State, attribute 50% of the settlement funds for that State to its Subdivisions according to the Subdivision Allocation Percentage in Exhibit G to the Kroger Settlement Agreement.

Illustrative example:
• Assume that State A is allocated 1.00000% of the $1,200,000,000 Remediation amount [see Exhibit M of the Kroger Settlement Agreement]. • 50% of the 1% share allocated to State A is $6,000,000.

1 See Kroger Settlement Agreement, Exhibit R § II.D.2. 2 Kroger Settlement Agreement, Exhibit R § II.D.2. 3 Kroger Settlement Agreement, Exhibit R § II.A.1 & II.D.1.

2 • Assume that, per Exhibit G of the Agreement, the Subdivision Allocation Percentage for City B in State A is 1.00000000%.
• For purposes of determining its counsel’s share of the Contingency Fee Fund, City B is attributed 1.00000000% of $6,000,000, or $60,000. (2) Adjust the amounts in paragraph 1 as follows:
a. Upward Adjustment for Early Filers. Increase the amount calculated in paragraph 1 above by 10% for any Litigating Subdivision that named Kroger in a suit before December 5, 2017, the date the National Prescription Opiate Litigation MDL was formed. If the Litigating Subdivision did not name Kroger in a suit before September 8, 2023, then fees from the Contingency Fee Fund will not be awarded to Attorneys with otherwise Qualifying Representations of that Participating Litigating Subdivision.

Illustrative Example:
• Assume City C is attributed $1,000,000 under paragraph 1 above. • If City C named Kroger before 12/5/2017, the attributed amount would be adjusted to $1,100,000.
b. Determine Amount Due under Contingency Fee Contract. Determine the amount that would be due to Attorneys with Qualifying Representations of each Participating Litigating Subdivision under the terms of the applicable fee contract if the Participating Litigating Subdivision were to receive the amount calculated in paragraph 2.a. This amount can be referred to as the Contingency Fee Assumption.

Illustrative Example:
• Continuing the example given in paragraph 2.a, if Attorneys have a 20% contingency fee contract with City C for the relevant litigation, the amount calculated in this step would be 20% of $1,100,000, or $220,000.

In the next step, the Contingency Fee Assumption is used to determine the percentage share of the Contingency Fee Fund due to Attorneys for each Participating Litigating Subdivision.
(3) Divide the Contingency Fee Fund proportionately among Attorneys for each Participating Litigating Subdivision in two ways:
a. National Fee Pool Calculation. Determine each Litigating Subdivision’s

3 percentage share of all amounts due under contingency fee contracts nationwide by dividing the Contingency Fee Assumption calculated for each Subdivision in paragraph 2.b by the sum of all Contingency Fee Assumptions. Then multiply that percentage by the Contingency Fee Fund to figure each Subdivision’s dollar share of the Contingency Fee Fund (but only if the Subdivision timely named Kroger in a lawsuit).

Illustrative example:
• $220,000 [from para. 2.b] ÷ $280,000,000 [total amount owed under contingency fee contracts nationwide] = 0.0785714%4
• 0.0785714% * $225,493,007.20 [Contingency Fee Fund] = $177,173.01
b. Separate State Fee Pools Calculation. Determine each Litigating Subdivision’s percentage share of all amounts due under contingency fee contracts statewide by dividing the Contingency Fee Assumption calculated for each Subdivision in paragraph 2.b by the sum of all Contingency Fee Assumptions in the same State.

Then multiply that percentage by the portion of the Contingency Fee Fund that corresponds to that State’s Overall Allocation Percentage, shown in Exhibit F of the Kroger Settlement Agreement, to figure each Subdivision’s dollarshare of the Contingency Fee Fund (but only if the Subdivision timely named Kroger in a lawsuit).

Illustrative example:
• 1% * $225,493,007.20 = $2,254,930.072 [amount of the
Contingency Fee Fund corresponding to State A]
• Assume a total of $2,500,000 is owed under contingency fee contracts for State A.
• $220,000 [from para. 2.b] ÷ $2,500,000 = 8.8%
• 8.8% * $2,254,930.072 = $198,433.85
The award of fees to Attorneys with Qualifying Representations of Participating Litigating Subdivisions will be the average of the final amounts calculated in paragraphs

3.a and 3.b above, less any amounts the Fee Panel is authorized to, and does, withhold.5 Paragraph 3.a represents allocation based on a proportional share of a National Fee Pool, 4 In this example, $280 million is the amount theoretically owed under all contingency fee contracts for litigation against Kroger as calculated in paragraph 2.b. This amount is illustrative only; the actual amount will not be known until all litigating subdivisions are identified and the terms of their contingency fee contracts are collected. 5 The model also enforces a maximum fee award of 20% of the amount calculated in paragraph 2.b. The description in this document of the Mathematical Model is by necessity an abstraction; the precise contours of the calculations are defined in the model itself.

4 while paragraph 3.b represents allocation based on a proportional share of the Separate State Fee Pools. In other words, for the National Fee Pool described above in paragraph

3.a, the contingency fee contract rate is compared to all other contingency fee contract rates in the nation. For the Separate State Fee Pools described above in paragraph 3.b, the contingency fee contract terms are compared to the other contingency fee contract terms in that same State. The National Fee Pool and the Separate State Fee Pools are given equal weighting.

Using the first methodology, Attorneys for two Subdivisions in different States with the same amount calculated under paragraph 2.b would be assigned the same amount under paragraph 3.a. Using the second methodology, Attorneys for the same two Subdivisions would be assigned different amounts under paragraph 3.b because they are in different States. Specifically, the Subdivision in the State with a smaller proportion of Participating Litigating Subdivisions would be allocated more than the Subdivision in the State with a greater proportion of Participating Litigating Subdivisions.

5 By:

Name: Chantale Fiebig
Date: March 21, 2024
On behalf of Kroger

6 By:

Name: Paul T. Farrell, Jr.

Date:

By:

Name: Jayne Conroy
Date:

By:

Name: Joseph F. Rice
Date:

On behalf of Plaintiffs’ Executive Committee

EXHIBIT S
State Outside Counsel Fee Fund

1. Definitions. This Exhibit incorporates all defined terms in the Agreement. Additionally, the following definitions apply to this Exhibit:
a. “State Outside Counsel Fee Fund” or “Fee Fund” means the fees portion of the State AG Fees and Costs amount, which is disbursed pursuant to this Exhibit. b. “Outside Counsel States” means Alaska and Utah, the two states with litigation brought by outside counsel as of September 8, 2023, when the agreement in principle was announced.
c. “Retained Amount” means any amount retained by Kroger pursuant to Section 4 below.

2. Payment. The amount of the State Outside Counsel Fee Fund is $8 million. It is to be paid by Kroger pursuant to the schedule in Exhibit M-3 and the terms of the Agreement, including this Exhibit.

3. Allocation. The State Outside Counsel Fee Fund is allocated evenly between the Outside Counsel States, with Alaska and Utah each eligible for an allocation of $4 million. If both Outside Counsel States are Settling States, the Settlement Fund Administrator shall evenly allocate the Fee Fund portion of the Annual Fees Payments between the two states.

4. Use of Funds. An Outside Counsel State may use any or all of a Fee Fund payment for the payment of (or reimbursement for) outside counsel fees and/or for Opioid Remediation.

5. Retained Amount for Non-Settling Outside Counsel States. If an Outside Counsel State is a Non-Settling State, then its Fee Fund allocation shall not be paid by Kroger. The Retained Amount shall be applied to the back end of all payments for State AG Fees and Costs and the Additional Remediation Amount.

For example, if one Outside Counsel State is a Non-Settling State, then the following would occur:
i. The $4 million Retained Amount would be applied to Payment Year 6 and there would be no payment that year for the Fee Fund, State Cost Fund, or Additional Restitution Amount.
ii. The full Payment Year 3 Fee Fund payment would be made to the Outside Counsel State that is a Settling State.
iii. The two Additional Remediation payments will move up a year and be paid in Payment Years 4 and 5.

EXHIBIT T
State Cost Fund

1. Definitions. This Exhibit incorporates all defined terms in the Agreement. Additionally, the following definitions apply to this Exhibit:
a. “Agreement on the Joint State Cost Fund” means the Agreement on the Joint State Cost Fund, which is Exhibit T to the multistate settlement agreements with Allergan Finance, LLC, CVS Health Corporation, Teva Pharmaceutical Industries Ltd., Walgreen Co., and Walmart Inc.
b. “Joint State Cost Fund” means the fund for state costs established by the Agreement on the Joint State Cost Fund.
c. “Joint State Cost Fund Committee” means the committee established to oversee the Joint State Cost Fund pursuant to the Agreement on the Joint State Cost Fund. d. “Litigating States” means Alaska, Utah, and Washington, the three states with active litigation as of September 8, 2023, when the agreement in principle was announced.
e. “Priority Payment” means a payment to a Litigating State that becomes a Settling State for Kroger-related costs that is made pursuant to the requirements of Section 4 below.
f. “State Cost Fund” means the State costs portion of the State AG Fees and Cost amount, which is disbursed through this Exhibit.

2. Payment. The amount of the State Cost Fund is $8 million. It is to be paid by Kroger pursuant to the schedule in Exhibit M-3 and the terms of the Agreement, including this Exhibit.

The amount to be paid by Kroger into the State Cost Fund will be reduced by $2 million for each Litigating State that does not become a Settling State. The Retained Amount shall be applied to the back end of all payments for State AG Fees and Costs and the Additional Remediation Amount.

3. NAAG Grant Reimbursement. From the initial State Cost Fund payment in Payment Year 1, there shall be a disbursement to the relevant NAAG fund for any opioid grant reimbursement amount that is owing and is not scheduled to be paid from another source. Any initial NAAG grant reimbursement paid from the State Cost Fund pursuant to this provision shall not exceed $1.5 million. The foregoing sentence is not intended to limit reimbursements to NAAG from the Joint State Cost Fund.

4. Priority for Litigating States. Each Litigating State that becomes a Settling State is eligible for a Priority Payment of up to $2 million per state from the State Cost Fund for Krogerrelated costs. The process for such priority payments is as follows:

a. The Litigating State will provide the Joint State Cost Fund Committee with a written statement of the amount of its Kroger-related costs and a request for a Priority Payment of such costs up to $2 million. The Litigating State will certify that these costs are eligible for reimbursement pursuant to the requirements the Joint State Cost Fund Committee has established for payments from the Joint State Cost Fund.
b. The Priority Payments to Litigating States shall be made from the amounts Kroger pays to the State Cost Fund in Payment Years 1 and 2.
c. If there are not sufficient funds to fully pay any NAAG grant reimbursement amount and all Litigating State Priority Payments in Payment Year 1, then the $4 million Year 1 State Cost Fund payment shall fully cover the NAAG reimbursement amount and the remaining amount shall be allocated equitably among the Litigating State Priority Payments pursuant to instructions from the Joint State Cost Fund Committee. The remaining priority payment amounts shall be paid from the Payment Year 2 State Cost Fund payment.
d. Litigating States receiving a Priority Payment shall submit the costs covered by such payment to the Joint State Cost Fund Committee (or its auditor) so that the Committee may account for the expenses and their reimbursement in processing applications for any payments from the Joint State Cost Fund and otherwise confirm the eligibility of such expenses. If such submitted expenses are determined by the Committee to be ineligible pursuant to the requirements the Joint State Cost Fund Committee has established for payments from the Joint State Cost Fund, the recipient will refund the amount of any such ineligible expense to the Joint State Cost Fund.

5. Eligibility for Joint Cost Fund Payments. While they will be credited with having received Priority Payments, Litigating States receiving Priority Payments remain eligible to apply for cost reimbursement from the Joint State Cost Fund for expenses not covered by the Priority Payments. Should a Litigating State receive additional funds for remediation or fees from Kroger outside of this Agreement, such additional funds shall not affect such State’s eligibility for reimbursement of costs from funds paid into the Joint State Cost Fund from the Kroger State Cost Fund payments.

6. Remaining State Cost Fund Amounts. State Cost Fund payment amounts that are not directed to NAAG grant reimbursement or to Litigating State Priority Payments pursuant to this Exhibit shall be directed to the Joint State Cost Fund to be disbursed pursuant to the Agreement on the Joint State Cost Fund.

7. Clarification. No State that is not a Settling State may receive payments from the State Cost Fund.

The Kroger Co
31-0345740
1014 Vine Street
Cincinnati, OH 45202 National Prescription Opiate Litigation XX/XX/2024
24 [Appropriate Official]
[Designated State]
[Address]

XX-XXXXXXX

A, B, I
*
*
*
*
U.S. District Court for the Northern District of Ohio and Jurisdictions of other cases settled under the Settlement Agreement entered into by the Kroger Co .and the Settling States (as defined in the Agreement), dated as of [_].

No. 1:1-MD2804, and other cases settled under the Settlement Agreement entered into by the Kroger Co. and the Settling States (as defined in the Agreement), dated as of [_].

EXHIBIT U - Exemplar Tax Form

V-1

EXHIBIT V
[Intentionally Omitted]

W-1

EXHIBIT W
Non-Litigating Threshold Subdivisions
[Exhibit to be inserted prior to the Effective Date]

X-1

EXHIBIT X
Governor’s Release of Opioid-Related Claims Pursuant to the Kroger Settlement Agreement
I, [NAME], Governor of the [Commonwealth]/[State]/[Territory] of [Commonwealth]/[State]/[Territory], hereby authorize Attorney General [NAME] to settle and release, to the maximum extent of my power as Governor, all Released Claims of (1) all of [Commonwealth]/[State]/[Territory]’s past and present executive departments, state agencies, divisions, boards, commissions and instrumentalities with regulatory authority to enforce state and federal controlled substances acts and (2) all of [Commonwealth]/[State]/[Territory]’s past and present executive departments, agencies, divisions, boards, commissions, and instrumentalities that have the authority to bring Claims related to Covered Conduct seeking money (including abatement and/or remediation) or revocation or suspension of a pharmaceutical distribution or dispensing license. The foregoing authorization is given in connection with Section X.G of the Kroger Settlement Agreement dated as of March 22, 2024 setting forth the terms of settlement between and among Kroger, on the one hand, and the Settling States and Participating Subdivisions, on the other hand. This release is intended to be a “release from a State’s Governor” as contemplated in such section. Capitalized terms used herein and defined in the Settlement Agreement have the meanings given to them in such settlement agreement. ____________________________
[Name]
Governor of the [Commonwealth]/[State]/[Territory] of [Commonwealth]/[State]/[Territory] Date: ___________________

Proposed California State-Subdivision Agreement
Regarding Distribution and Use of
Settlement Funds – Kroger Settlement

1. Introduction
Pursuant to the Kroger Settlement Agreement, dated as of March 22, 2024, and any revision thereto as well as any modification thereto entered into by the State of California and Kroger (the “Kroger Settlement Agreement”), including Section V and Exhibit O, the State of California proposes this agreement (the “CA Kroger Allocation Agreement”) to govern the allocation, distribution, and use of Settlement Fund payments made to California pursuant to Sections IV and V of the Kroger Settlement Agreement. For the avoidance of doubt, this agreement does not apply to payments made pursuant to Section IX of the Kroger Settlement Agreement.

Pursuant to Exhibit O, Paragraph 4, of the Kroger Settlement Agreement, acceptance of this CA Kroger Allocation Agreement is a requirement to be an Initial Participating Subdivision.

2. Definitions
a) CA Participating Subdivision means a Participating Subdivision that is also (a) a Plaintiff Subdivision and/or (b) a Primary Subdivision with a population equal to or greater than 10,000. For the avoidance of doubt, eligible CA Participating Subdivisions are those California subdivisions listed in Exhibit C (excluding Litigating Special Districts) and/or Exhibit I to the Kroger Settlement Agreement. b) Allergan Settlement Agreement means the Allergan Settlement Agreement dated November 22, 2022, and any revision thereto.
c) CVS Settlement Agreement means the CVS Settlement Agreement dated December 9, 2022, and any revision thereto as well as any modification thereto entered into by the State of California and CVS.
d) Distributor Settlement Agreement means the Distributor Settlement Agreement dated July 21, 2021, and any revision thereto.
e) Janssen Settlement Agreement means the Janssen Settlement Agreement dated July 21, 2021, and any revision thereto.
f) Teva Settlement Agreement means the Teva Settlement Agreement dated November 22, 2022, and any revision thereto.
g) Walgreens Settlement Agreement means the Walgreens Settlement Agreement dated December 9, 2022, and any revision thereto.
h) Walmart Settlement Agreement means the Walmart Settlement Agreement dated November 14, 2022, and any revision thereto.
i) CA Litigating Special District means a Litigating Special District located in California. CA Litigating Special Districts include Downey Unified School District, 1 Page 562 of 591

Elk Grove Unified School District, Kern High School District, Montezuma Fire Protection District (located in Stockton, California), Santa Barbara San Luis Obispo Regional Health Authority, Inland Empire Health Plan, Health Plan of San Joaquin, San Leandro Unified School District, Pleasant Valley School District Board, and LA Care Health Plan.
j) Plaintiff Subdivision means a Subdivision located in California, other than a CA Litigating Special District, that filed a lawsuit, on behalf of the Subdivision and/or through an official of the Subdivision on behalf of the People of the State of California, against one or more Opioid Defendants prior to October 1, 2020. k) Opioid Defendant means any defendant (including but not limited to Kroger Co., Walgreen Co., Teva Pharmaceutical Industries Ltd., Allergan Finance, LLC, Allergan Limited, CVS Health Corporation, CVS Pharmacy, Inc., Walmart Inc., Johnson & Johnson, Janssen Pharmaceuticals, Inc., Purdue Pharma L.P., Cardinal Health, Inc., AmerisourceBergen Corporation, and McKesson Corporation) named in a lawsuit seeking damages, abatement, or other remedies related to or caused by the opioid public health crisis in any lawsuit brought by any state or local government on or before October 1, 2020.

3. General Terms
This agreement is subject to the requirements of the Kroger Settlement Agreement, as well as applicable law, and the Kroger Settlement Agreement governs over any inconsistent provision of this CA Kroger Allocation Agreement. Terms used in this CA Kroger Allocation Agreement have the same meaning as in the Kroger Settlement Agreement unless otherwise defined herein.

Pursuant to Section V(D)(1) of the Kroger Settlement Agreement, (a) all Settlement Fund payments will be used for Opioid Remediation, except as allowed by Section V(B)(2) of the Kroger Settlement Agreement; and (b) at least seventy percent (70%) of Settlement Fund payment amounts will be used solely for future Opioid Remediation.

4. State Allocation
The Settlement Fund payments to California,1
pursuant to the Kroger Settlement Agreement,
shall be allocated as follows: 15% to the State Fund; 70% to the Abatement Accounts Fund; and 15% to the Subdivision Fund. For the avoidance of doubt, all funds allocated to California from the Settlement Fund shall be combined pursuant to this CA Kroger Allocation Agreement, and 15% of that total shall be allocated to the State of California (the “State of California Allocation”), 70% to the California Abatement Accounts Fund (“CA Abatement Accounts Fund”), and 15% to the California Subdivision Fund (“CA Subdivision Fund”). 1 For purposes of clarity, use of the term “California” refers to the geographic territory of California and the state and its local governments therein. The term “State” or “State of California” refers to the State of California as a governmental unit. 2 Page 563 of 591

A. State of California Allocation
Fifteen percent of the total Settlement Fund payments will be allocated to the State and used by the State for future Opioid Remediation.

B. CA Abatement Accounts Fund
i. Allocation of CA Abatement Accounts Funds
a) Seventy percent of the total Settlement Fund payments will be allocated to the CA Abatement Accounts Fund. The funds in the CA Abatement Accounts Fund will be allocated based on the allocation model developed in connection with the proposed negotiating class in the National Prescription Opiate Litigation (MDL No. 2804), as adjusted to reflect only those cities and counties that are eligible, based on population or litigation status, to become a CA Participating Subdivision. The percentage from the CA Abatement Accounts Fund allocated to each CA Participating Subdivision is set forth in Appendix 1 in the column entitled abatement percentage (the “Local Allocation”). For the avoidance of doubt, CA Litigating Special Districts and California towns, cities, and counties with a population less than 10,000 are not eligible to receive an allocation of CA Abatement Accounts Funds.
b) A CA Participating Subdivision that is a county, or a city and county, will be allocated its Local Allocation share as of the date on which it becomes a Participating Subdivision, and will receive payments as provided in the Kroger Settlement Agreement. c) A CA Participating Subdivision that is a city will be allocated its Local Allocation share as of the date on which it becomes a Participating Subdivision. The Local Allocation share for a city that is a CA Participating Subdivision will be paid to the county in which the city is located, rather than to the city, so long as: (a) the county is a CA Participating Subdivision, and (b) the city did not elect to receive its share of funds in the National Opioids Settlement with Distributors AmerisourceBergenCorporation, Cardinal Health, Inc., and McKesson Corporation (the “Distributors Settlement”). If a city later changes or has already changed its distribution election in the Distributors Settlement, that change in election will apply here, provided that the change in election is received by the settlement administrator at least 60 days prior to a Payment Date. A Local Allocation share allocated to a city but paid to a county is not required to be spent exclusively for abatement activities in that city, but will become part of the county’s share of the CA Abatement Accounts Funds, which will be used in accordance with Section 4.B.ii (Use of CA Abatement Accounts Funds) and reported on in accordance with Section 4.B.iii (CA Abatement Accounts Fund Oversight).
d) A city within a county that is a CA Participating Subdivision may opt in or out of direct payment at any time, and it may also elect direct payment of only a portion of its share, with the remainder going to the county, by providing notice to the Settlement Fund Administrator at least 60 days prior to a Payment Date. For purposes of this CA Kroger Allocation Agreement, the Cities of Los Angeles, Oakland, San Diego, San Jose and 3 Page 564 of 591

Eureka will be deemed to have elected direct payment if they become Participating Subdivisions.
e) The State will receive the Local Allocation share of any payment to the Settlement Fund that is attributable to a county or city that is eligible to become a CA Participating Subdivision, but that has not, as of the date of that payment to the Settlement Fund, become a Participating Subdivision.
f) Funds received by a CA Participating Subdivision, and not expended or encumbered within five years of receipt and in accordance with the Kroger Settlement Agreement and this CA Kroger Allocation Agreement shall be transferred to the State; provided however, that CA Participating Subdivisions have seven years to expend or encumber CA Abatement Accounts Funds designated to support capital outlay projects before they must be transferred to the State. This provision shall not apply to the Cost Reimbursement Funds, which shall be controlled by Appendix 2.
ii. Use of CA Abatement Accounts Funds
a) The CA Abatement Accounts Funds will be used for future Opioid Remediation in one or more of the areas described in the List of Opioid Remediation Uses, which is Exhibit E to the Kroger Settlement Agreement.
b) In addition to this requirement, no less than 50% of the funds received by a CA Participating Subdivision from the Abatement Accounts Fund in each calendar year will be used for one or more of the following High Impact Abatement Activities:
(1) the provision of matching funds or operating costs for substance use disorder facilities within the Behavioral Health Continuum Infrastructure Program; (2) creating new or expanded Substance Use Disorder (“SUD”) treatment infrastructure; (3) addressing the needs of communities of color and vulnerable populations (including sheltered and unsheltered homeless populations) that are disproportionately impacted by SUD;
(4) diversion of people with SUD from the justice system into treatment, including by providing training and resources to first and early responders (sworn and non-sworn) and implementing best practices for outreach, diversion and deflection, employability, restorative justice, and harm reduction;
(5) interventions to prevent drug addiction in vulnerable youth, including but not limited to, youth in foster care, juvenile justice-impacted youth, youth experiencing adversities related to socioeconomic status, and unhoused youth; and/or (6) the purchase of naloxone for distribution and efforts to expand access to naloxone for opioid overdose reversals.
4 Page 565 of 591

c) The California Department of Health Care Services (“DHCS”) may add to this list (but not delete from it) by designating additional High Impact Abatement Activities. DHCS will make reasonable efforts to consult with stakeholders, including the CA Participating Subdivisions, before adding additional High Impact Abatement Activities to this list. d) For the avoidance of doubt, and subject to the requirements of the Kroger Settlement Agreement and applicable law, CA Participating Subdivisions may form agreements or ventures, or otherwise work in collaboration with, federal, state, local, tribal or private sector entities in pursuing Opioid Remediation activities funded from the CA Abatement Accounts Fund. Further, provided that all CA Abatement Accounts Funds are used for Opioid Remediation consistent with the Kroger Settlement Agreement and this CA Kroger Allocation Agreement, a county and any cities or towns within the county may agree to reallocate their respective shares of the CA Abatement Accounts Funds among themselves, provided that any direct distribution may only be to a CA Participating Subdivision and any CA Participating Subdivision must agree to their share being reallocated.
iii. CA Abatement Accounts Fund Oversight
a) Pursuant to Section 5 below, CA Participating Subdivisions receiving settlement funds must prepare and file reports annually regarding the use of those funds. DHCS may regularly review the reports prepared by CA Participating Subdivisions about the use of CA Abatement Accounts Funds for compliance with the Kroger Settlement Agreement and this CA Kroger Allocation Agreement.
b) If DHCS determines that a CA Participating Subdivision’s use of CA Abatement Accounts Funds is inconsistent with the Kroger Settlement Agreement or this CA Kroger Allocation Agreement, whether through review of reports or information from any other sources, DHCS shall send a request to meet and confer with the CA Participating Subdivision. The parties shall meet and confer in an effort to resolve the concern. c) If the parties are unable to reach a resolution, DHCS may conduct an audit of the Subdivision’s use of the CA Abatement Accounts Funds within one year of the request to meet and confer, unless the parties mutually agree in writing to extend the meet and confer time frame.
d) If the concern still cannot be resolved, the State may bring a motion or action in the court where the State has filed its Consent Judgment to resolve the concern or otherwise enforce the requirements of the Kroger Settlement Agreement or this CA Kroger Allocation Agreement. However, in no case shall any audit be conducted, or motion be brought, as to a specific expenditure of funds, more than five years after the date on which the expenditure of the funds was reported to DHCS, in accordance with this agreement.
5 Page 566 of 591

e) Notwithstanding the foregoing, this Agreement does not limit the statutory or constitutional authority of any state or local agency or official to conduct audits, investigations, or other oversight activities, or to pursue administrative, civil, or criminal enforcement actions.

C. CA Subdivision Fund
i. Fifteen percent of the total Settlement Fund payments will be allocated to the CA Subdivision Fund. All funds in the CA Subdivision Fund will be allocated among the Plaintiff Subdivisions that are Initial Participating Subdivisions. The funds will be used, subject to any limits imposed by the Kroger Settlement Agreement and this CA Kroger Allocation Agreement, to fund future Opioid Remediation and reimburse past opioidrelated expenses, which may include fees and expenses related to litigation, and to pay the reasonable fees and expenses of the Special Master as set forth in Appendix 2.

The CA Subdivision Funds will be allocated as follows:
a) First, funds in the CA Subdivision Fund shall be used to pay the Special Master’s reasonable fees and expenses in accordance with the procedures and limitations set forth in Appendix 2 to this document;
b) Second, funds will be allocated to Plaintiff Subdivisions that are Initial Participating Subdivisions that have been awarded Costs, as defined by and in accordance with the procedures and limitations set forth in Appendix 2 to this document. c) Funds remaining in the CA Subdivision Fund, which shall consist of no less than 50% of the total CA Subdivision Fund received in any year pursuant to Appendix 2, Section 2.c.v, will be distributed to Plaintiff Subdivisions that are Initial Participating Subdivisions, in relative proportion to the Local Allocation. These funds shall be used to fund future opioid-related projects and to reimburse past opioid-related expenses, which may include fees and expenses related to litigation against any Opioid Defendant.

D. Provision for State Back-Stop Agreement
On August 6, 2021, Judge Dan Polster of the U.S. District Court, Northern District of Ohio, Eastern Division, issued an order (ECF Docket Number 3814) (“MDL Fees Order”) in the National Prescription Opiate Litigation (MDL No. 2804) “cap[ping] all applicable contingent fee agreements at 15%.” Private counsel representing Plaintiff Subdivisions should seek its contingency fees and costs from the Attorney Fee Fund or Cost Funds under the Kroger Settlement Agreement, and, if applicable, the Teva Settlement Agreement, Allergan Settlement Agreement, CVS Settlement Agreement, Distributor Settlement Agreement, Janssen Settlement Agreement, and Walmart Settlement Agreement.

A Plaintiff Subdivision may separately agree to use its share of the CA Subdivision Fund to pay for fees or costs incurred by its contingency-fee counsel (“State Back-Stop Agreement”), 6 Page 567 of 591

pursuant to Exhibit R, section I(CC), of the Kroger Settlement Agreement and the MDL Fees Order, so long as such contingency fees do not exceed a total contingency fee of 15% of the total gross recovery of the Plaintiff Subdivision pursuant to the Kroger Settlement, inclusive of contingency fees from the national Attorney Fee Fund and this State Back-Stop Agreement.

Before seeking fees or litigation costs and expenses from a State Back-Stop Agreement, private counsel representing Plaintiff Subdivisions must first seek contingency fees and costs from the Attorney Fee Fund or Cost Funds created under the Kroger Settlement Agreement. Further, private counsel may only seek reimbursement for litigation fees and costs that have not previously been reimbursed through prior settlements or judgments.

To effectuate a State Back-Stop Agreement pursuant to this section, an agreement in the form of Appendix 3 may be entered into by a Plaintiff Subdivision, private counsel, and the California Office of the Attorney General. The California Office of the Attorney General shall, upon the request of a Plaintiff Subdivision, execute any agreement executed by a Plaintiff Subdivision and its private counsel if it is in the form of Appendix 3. The California Office of the Attorney General will also consider requests from Plaintiff Subdivisions to execute and enter into agreements presented in other forms.

For the avoidance of doubt, this agreement does not require a Plaintiff Subdivision to request or enter into a State Back-Stop Agreement, and no State Back-Stop Agreement shall impose any duty or obligation on the State of California or any of its agencies or officers, including without limitation the Attorney General.

5. State and Subdivision Reporting
a) DHCS will prepare an annual written report regarding the State’s use of funds from the settlement until those funds are fully expended and for one year thereafter. These reports will be made publicly available on the DHCS web site.
b) Each CA Participating Subdivision that receives payments of funds from the settlement will prepare written reports at least annually regarding the use of those funds, until those funds are fully expended and for one year thereafter. These reports will also include a certification that all funds that the CA Participating Subdivision has received through the settlement have been used in compliance with the Kroger Settlement Agreement and this CA Kroger Allocation Agreement. The report will be in a form reasonably determined by DHCS. Prior to specifying the form of the report DHCS will confer with representatives of the Plaintiff Subdivisions.
c) The State and all CA Participating Subdivisions receiving CA Abatement Accounts Funds will track all deposits and expenditures. Each such subdivision is responsible solely for the CA Abatement Accounts Funds it receives. A county is not responsible for oversight, reporting, or monitoring of CA Abatement Accounts Funds received by a city within that county that receives direct payment. Unless otherwise exempt, Subdivisions’ expenditures and uses of CA Abatement Accounts Funds and other Settlement Funds will be subject to the normal budgetary and expenditure process of the Subdivision. 7 Page 568 of 591

d) Each Plaintiff Subdivision receiving CA Subdivision Funds will track all deposits and expenditures, as required by the Kroger Settlement Agreement and this CA Kroger Allocation Agreement. Among other things, Plaintiff Subdivisions using monies from the CA Subdivision Fund for purposes that do not qualify as Opioid Remediation must identify and include in their annual report, the amount and how such funds were used, including if used to pay attorneys’ fees, investigation costs, or litigation costs. Pursuant to Section V(B)(2) of the Kroger Settlement Agreement, such information must also be reported to the Settlement Fund Administrator and Kroger. e) In each year in which DHCS prepares an annual report DHCS will also host a meeting to discuss the annual report and the Opioid Remediation activities being carried out by the State and Participating Subdivisions.

6. Miscellaneous
a) The State or any CA Participating Subdivision may bring a motion or action in the court where the State has filed its Consent Judgment to enforce the requirements of this CA Kroger Allocation Agreement. Before filing such a motion or action the State will meet and confer with any CA Participating Subdivision that is the subject of the anticipated motion or action, and vice versa.
b) Except as provided in the Kroger Settlement Agreement, this CA Kroger Allocation Agreement is not enforceable by any party other than the State and the CA Participating Subdivisions. It does not confer any rights or remedies upon, and shall not be enforceable by, any third party.
c) Except as provided in the CA Kroger Allocation Agreement, if any provision of this agreement or the application thereof to any person, entity, or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this agreement, or the application of such provision to persons, entities, or circumstances other than those as to which it is invalid or unenforceable, will not be affected thereby, and each other provision of this agreement will be valid and enforceable to the fullest extent permitted by law. d) Except as provided in the Kroger Settlement Agreement, this agreement shall be governed by and interpreted in accordance with the laws of California. 8 Page 569 of 591
APPENDIX 1
DISCLAIMER: The allocation percentages herein are estimates only and should not be relied on for decisions regarding legal rights, releases, waivers, or other decisions affecting current or potential legal claims. Percentages shown in the Plaintiff Subdivision Percentage column may change pursuant to Section 4.C. of the California State-Subdivision Agreement Regarding Distribution and Use of Settlement Funds—Kroger Settlement, whereas the percentages shown in the Abatement Percentage column should not change. Participating Subdivisions, underlying calculations, and the calculated allocation percentages are subject to change. Regarding the column herein entitled “Abatement Percentage,” pursuant to Section 4.B.e., the State of California will receive the Local Allocation share of any payment to the Settlement Fund that is attributable to a county or city that is eligible to become a CA Participating Subdivision, but that has not, as of the date of that payment to the Settlement Fund, become a Participating Subdivision. Regarding the column herein entitled “Plaintiff Subdivision Percentage,” payments allocated to a Plaintiff Subdivision, which is not an Initial Participating Subdivision, will be re-allocated among the Plaintiff Subdivisions that are Initial Participating Subdivisions.

Regarding the column herein entitled “Abatement Percentage,” the annotation of “100%” refers to one-hundred percent (100%) of the California Abatement Account Funds received, pursuant to Section 4.B. Regarding the column herein entitled “Plaintiff Subdivision Percentage,” the annotation of “100%” refers to one-hundred percent (100%) of the California Subdivision Funds received, pursuant to Section 4.C. Regarding the column herein entitled “Weighted Allocation Percentage,” the annotation of “100%” refers to onehundred percent (100%) of the combined and weighted allocation of the Abatement Percentage and the Plaintiff Subdivision Percentage.

APPENDIX 1
100.000% 100.000% 100.000%
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage County  Alameda County Alameda  2.332%  2.853%  2.4237952% City  Alameda  Alameda  0.069%  0.0570162%
City  Albany  Alameda  0.013%  0.0107768% City  Berkeley  Alameda  0.152%  0.1249656% City  Dublin  Alameda  0.033%  0.040%  0.0338810%
City  Emeryville  Alameda  0.023%  0.0185765%
City  Fremont  Alameda  0.108%  0.0888576% City  Hayward  Alameda  0.117%  0.0966218% City  Livermore  Alameda  0.054%  0.0446740% City  Newark  Alameda  0.026%  0.0217626% City  Oakland  Alameda  0.486%  0.595%  0.5055601% City  Piedmont  Alameda  0.014%  0.0114064%
City  Pleasanton  Alameda  0.067%  0.0554547%
City  San Leandro  Alameda  0.039%  0.0321267%
City  Union City  Alameda  0.043%  0.0352484%
County  Amador County Amador  0.226%  0.277%  0.2349885% County  Butte County Butte  1.615%  1.975%  1.6783178%
City  Chico  Butte  0.216%  0.264%  0.2246499%
City  Oroville  Butte  0.079%  0.0646595%
County  Calaveras County Calaveras  0.226%  0.277%  0.2351644% County  Colusa County Colusa  0.059%  0.0489221% County  Contra Costa County Contra Costa  2.102%  2.571%  2.1844585% City  Antioch  Contra Costa  0.037%  0.0301879% City  Brentwood  Contra Costa  0.026%  0.0215339% City  Clayton  Contra Costa  0.002%  0.0018060%
City  Concord  Contra Costa  0.055%  0.0456676%
City  Danville  Contra Costa  0.010%  0.0082255%
City  El Cerrito  Contra Costa  0.023%  0.0189024% City  Hercules  Contra Costa  0.010%  0.0078273% 1 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Lafayette  Contra Costa  0.006%  0.0046030% City  Martinez  Contra Costa  0.012%  0.0098593% City  Moraga  Contra Costa  0.004%  0.0031007% City  Oakley  Contra Costa  0.010%  0.0079416% City  Orinda  Contra Costa  0.005%  0.0038157% City  Pinole  Contra Costa  0.013%  0.0110909% City  Pittsburg  Contra Costa  0.053%  0.0436369% City  Pleasant Hill  Contra Costa  0.013%  0.0106309% City  Richmond  Contra Costa  0.146%  0.1201444% City  San Pablo  Contra Costa  0.018%  0.0148843% City  San Ramon  Contra Costa  0.021%  0.0176459% City  Walnut Creek  Contra Costa  0.026%  0.0212132% County  Del Norte County Del Norte  0.114%  0.140%  0.1189608% County  El Dorado County El Dorado  0.768%  0.939%  0.7980034% City  Placerville  El Dorado  0.015%  0.0127642%
City  South Lake Tahoe  El Dorado  0.081%  0.0665456%
County  Fresno County Fresno  1.895%  2.318%  1.9693410% City  Clovis  Fresno  0.065%  0.0536211% City  Coalinga  Fresno  0.012%  0.0098554% City  Fresno  Fresno  0.397%  0.3270605% City  Kerman  Fresno  0.005%  0.0042534% City  Kingsburg  Fresno  0.008%  0.0066167% City  Mendota  Fresno  0.002%  0.0019387% City  Orange Cove  Fresno  0.004%  0.0035607% City  Parlier  Fresno  0.008%  0.0069755% City  Reedley  Fresno  0.012%  0.0098804% City  Sanger  Fresno  0.018%  0.0146135% City  Selma  Fresno  0.015%  0.0127537%
County  Glenn County Glenn  0.107%  0.131%  0.1116978% County  Humboldt County Humboldt  1.030%  1.260%  1.0703185% 2 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Arcata  Humboldt  0.054%  0.0447660%
City  Eureka  Humboldt  0.117%  0.143%  0.1216284%
City  Fortuna  Humboldt  0.032%  0.0266837%
County  Imperial County Imperial  0.258%  0.315%  0.2679006% City  Brawley  Imperial  0.011%  0.0087986% City  Calexico  Imperial  0.019%  0.0152799% City  El Centro  Imperial  0.158%  0.1302522% City  Imperial  Imperial  0.006%  0.0048791% County  Inyo County Inyo  0.073%  0.089%  0.0754413% County  Kern County Kern  2.517%  3.079%  2.6159145% City  Arvin  Kern  0.006%  0.0046425% City  Bakersfield  Kern  0.212%  0.1747198% City  California City  Kern  0.009%  0.0070820% City  Delano  Kern  0.030%  0.0249316%
City  McFarland  Kern  0.003%  0.0025644%
City  Ridgecrest  Kern  0.015%  0.0120938% City  Shafter  Kern  0.013%  0.0103417% City  Tehachapi  Kern  0.009%  0.0073580% City  Wasco  Kern  0.008%  0.0069861% County  Kings County Kings  0.293%  0.2413469%
City  Avenal  Kings  0.007%  0.0056335% City  Corcoran  Kings  0.013%  0.0107032% City  Hanford  Kings  0.027%  0.0226038% City  Lemoore  Kings  0.016%  0.0131900% County  Lake County Lake  0.795%  0.6545389%
City  Clearlake  Lake  0.041%  0.050%  0.0426253%
City  Lakeport  Lake  0.021%  0.026%  0.0222964%
County  Lassen County Lassen  0.319%  0.391%  0.3320610% City  Susanville  Lassen  0.027%  0.0219295%
County  Los Angeles County Los Angeles  13.896%  16.999%  14.4437559% 3 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Agoura Hills  Los Angeles  0.005%  0.0040024%
City  Alhambra  Los Angeles  0.042%  0.0343309% City  Arcadia  Los Angeles  0.033%  0.0267718% City  Artesia  Los Angeles  0.001%  0.0005100%
City  Azusa  Los Angeles  0.026%  0.0210857% City  Baldwin Park  Los Angeles  0.027%  0.0218520% City  Bell  Los Angeles  0.008%  0.0068783% City  Bellflower  Los Angeles  0.002%  0.0014485% City  Bell Gardens  Los Angeles  0.014%  0.0114301% City  Beverly Hills  Los Angeles  0.065%  0.0534897% City  Burbank  Los Angeles  0.100%  0.0823132% City  Calabasas  Los Angeles  0.006%  0.0048948% City  Carson  Los Angeles  0.019%  0.0159805% City  Cerritos  Los Angeles  0.005%  0.0039682% City  Claremont  Los Angeles  0.010%  0.0082584% City  Commerce  Los Angeles  0.000%  0.0002971% City  Compton  Los Angeles  0.044%  0.0361882% City  Covina  Los Angeles  0.028%  0.0229127%
City  Cudahy  Los Angeles  0.001%  0.0006020%
City  Culver City  Los Angeles  0.055%  0.0449894% City  Diamond Bar  Los Angeles  0.001%  0.0006993% City  Downey  Los Angeles  0.052%  0.0429994% City  Duarte  Los Angeles  0.003%  0.0027261% City  El Monte  Los Angeles  0.031%  0.038%  0.0318985% City  El Segundo  Los Angeles  0.033%  0.0268020%
City  Gardena  Los Angeles  0.034%  0.0278088%
City  Glendale  Los Angeles  0.166%  0.1366586%
City  Glendora  Los Angeles  0.016%  0.0134411%
City  Hawaiian Gardens  Los Angeles  0.005%  0.0040549% City  Hawthorne  Los Angeles  0.050%  0.0407833%
4 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Hermosa Beach  Los Angeles  0.018%  0.0145307% City  Huntington Park  Los Angeles  0.023%  0.0190667% City  Inglewood  Los Angeles  0.059%  0.0489195% City  La Cañada Flintridge  Los Angeles  0.003%  0.0025565% City  Lakewood  Los Angeles  0.005%  0.0039971%
City  La Mirada  Los Angeles  0.010%  0.0081572% City  Lancaster  Los Angeles  0.045%  0.0369689% City  La Puente  Los Angeles  0.002%  0.0012999% City  La Verne  Los Angeles  0.024%  0.0194190% City  Lawndale  Los Angeles  0.002%  0.0017731% City  Lomita  Los Angeles  0.004%  0.0031940% City  Long Beach  Los Angeles  0.439%  0.3614151% City  Los Angeles  Los Angeles  2.715%  3.321%  2.8218811% City  Lynwood  Los Angeles  0.016%  0.0134345% City  Malibu  Los Angeles  0.002%  0.0019269% City  Manhattan Beach  Los Angeles  0.032%  0.0260686% City  Maywood  Los Angeles  0.004%  0.0035528% City  Monrovia  Los Angeles  0.031%  0.0254455% City  Montebello  Los Angeles  0.030%  0.0250670% City  Monterey Park  Los Angeles  0.031%  0.0256677% City  Norwalk  Los Angeles  0.031%  0.0258228% City  Palmdale  Los Angeles  0.046%  0.0375827% City  Palos Verdes Estates  Los Angeles  0.006%  0.0053102% City  Paramount  Los Angeles  0.011%  0.0091483% City  Pasadena  Los Angeles  0.146%  0.1200524% City  Pico Rivera  Los Angeles  0.022%  0.0183333% City  Pomona  Los Angeles  0.111%  0.0911933% City  Rancho Palos Verdes  Los Angeles  0.002%  0.0012645% City  Redondo Beach  Los Angeles  0.062%  0.0506992% City  Rosemead  Los Angeles  0.003%  0.0028260% 5 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  San Dimas  Los Angeles  0.003%  0.0022016%
City  San Fernando  Los Angeles  0.013%  0.0104837% City  San Gabriel  Los Angeles  0.018%  0.0147726% City  San Marino  Los Angeles  0.009%  0.0073791% City  Santa Clarita  Los Angeles  0.022%  0.0178167% City  Santa Fe Springs  Los Angeles  0.031%  0.0257531% City  Santa Monica  Los Angeles  0.158%  0.1298513% City  Sierra Madre  Los Angeles  0.006%  0.0048646% City  Signal Hill  Los Angeles  0.010%  0.0084884% City  South El Monte  Los Angeles  0.005%  0.0039603% City  South Gate  Los Angeles  0.020%  0.0166272% City  South Pasadena  Los Angeles  0.012%  0.0095334%
City  Temple City  Los Angeles  0.005%  0.0039498% City  Torrance  Los Angeles  0.112%  0.0919820% City  Walnut  Los Angeles  0.006%  0.0047305% City  West Covina  Los Angeles  0.049%  0.0404521% City  West Hollywood  Los Angeles  0.013%  0.0108517% City  Whittier  Los Angeles  0.032%  0.0260581%
County  Madera County Madera  0.349%  0.427%  0.3630669% City  Chowchilla  Madera  0.012%  0.0097332% City  Madera  Madera  0.039%  0.0318441% County  Marin County Marin  0.564%  0.690%  0.5861325%
City  Larkspur  Marin  0.015%  0.0124697%
City  Mill Valley  Marin  0.020%  0.0168401% City  Novato  Marin  0.028%  0.0229824% City  San Anselmo  Marin  0.009%  0.0078062%
City  San Rafael  Marin  0.089%  0.0729823%
County  Mariposa County Mariposa  0.084%  0.103%  0.0876131% County  Mendocino County Mendocino  0.439%  0.536%  0.4558394% City  Ukiah  Mendocino  0.039%  0.0317153%
6 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage County  Merced County Merced  0.551%  0.674%  0.5724262% City  Atwater  Merced  0.024%  0.0195846%
City  Livingston  Merced  0.006%  0.0045873%
City  Los Banos  Merced  0.020%  0.0165142%
City  Merced  Merced  0.061%  0.0500762%
County  Modoc County Modoc  0.065%  0.080%  0.0678250%
County  Mono County Mono  0.023%  0.029%  0.0242606% County  Monterey County Monterey  0.908%  1.111%  0.9437083% City  Greenfield  Monterey  0.006%  0.0050552% City  King City  Monterey  0.005%  0.0037355% City  Marina  Monterey  0.017%  0.0144098%
City  Monterey  Monterey  0.041%  0.0336540%
City  Pacific Grove  Monterey  0.009%  0.0074842% City  Salinas  Monterey  0.094%  0.0776576% City  Seaside  Monterey  0.023%  0.0191772%
City  Soledad  Monterey  0.007%  0.0060870%
County  Napa County Napa  0.288%  0.352%  0.2994325%
City  American Canyon  Napa  0.017%  0.0136869%
City  Napa  Napa  0.078%  0.0642783%
County  Nevada County Nevada  0.441%  0.539%  0.4579827% City  Grass Valley  Nevada  0.024%  0.0197805%
City  Truckee  Nevada  0.003%  0.0023843%
County  Orange County Orange  4.364%  5.339%  4.5363576% City  Aliso Viejo  Orange  0.014%  0.0113841%
City  Anaheim  Orange  0.554%  0.678%  0.5759282%
City  Brea  Orange  0.086%  0.0708897%
City  Buena Park  Orange  0.087%  0.0714352%
City  Costa Mesa  Orange  0.124%  0.152%  0.1288366%
City  Cypress  Orange  0.033%  0.0271937%
City  Dana Point  Orange  0.001%  0.0005560%
7 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Fountain Valley  Orange  0.055%  0.0455980% City  Fullerton  Orange  0.137%  0.168%  0.1425744% City  Garden Grove  Orange  0.213%  0.1752482% City  Huntington Beach  Orange  0.247%  0.302%  0.2568420% City  Irvine  Orange  0.139%  0.170%  0.1442350% City  Laguna Beach  Orange  0.047%  0.058%  0.0493043% City  Laguna Hills  Orange  0.014%  0.0115457% City  Laguna Niguel  Orange  0.001%  0.0007071% City  Laguna Woods  Orange  0.001%  0.0006546% City  La Habra  Orange  0.060%  0.073%  0.0621049% City  Lake Forest  Orange  0.012%  0.0101249%
City  La Palma  Orange  0.012%  0.0095439% City  Los Alamitos  Orange  0.008%  0.0069190% City  Mission Viejo  Orange  0.014%  0.0117560% City  Newport Beach  Orange  0.179%  0.1470134%
City  Orange  Orange  0.150%  0.1231320% City  Placentia  Orange  0.029%  0.035%  0.0298912% City  Rancho Santa Margarita  Orange  0.001%  0.0006296% City  San Clemente  Orange  0.008%  0.010%  0.0086083%
City  San Juan Capistrano  Orange  0.008%  0.0065510%
City  Santa Ana  Orange  0.502%  0.614%  0.5213866%
City  Seal Beach  Orange  0.020%  0.0165891%
City  Stanton  Orange  0.035%  0.0291955%
City  Tustin  Orange  0.073%  0.0600341%
City  Westminster  Orange  0.104%  0.127%  0.1082721%
City  Yorba Linda  Orange  0.044%  0.0362223%
County  Placer County Placer  1.045%  1.278%  1.0861002% City  Auburn  Placer  0.017%  0.0141114%
City  Lincoln  Placer  0.031%  0.0255599% City  Rocklin  Placer  0.076%  0.0625485% 8 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Roseville  Placer  0.196%  0.1616559%
County  Plumas County Plumas  0.205%  0.251%  0.2128729% County  Riverside County Riverside  4.534%  5.547%  4.7128296% City  Banning  Riverside  0.017%  0.0143848% City  Beaumont  Riverside  0.021%  0.0171135% City  Blythe  Riverside  0.012%  0.0096714%
City  Canyon Lake  Riverside  0.000%  0.0001761%
City  Cathedral City  Riverside  0.067%  0.0553614% City  Coachella  Riverside  0.021%  0.0173054% City  Corona  Riverside  0.147%  0.1207083% City  Desert Hot Springs  Riverside  0.024%  0.0200433% City  Eastvale  Riverside  0.000%  0.0002747% City  Hemet  Riverside  0.051%  0.0421792% City  Indio  Riverside  0.056%  0.0457794% City  Jurupa Valley  Riverside  0.001%  0.0008991% City  Lake Elsinore  Riverside  0.021%  0.0172949% City  La Quinta  Riverside  0.063%  0.0516732% City  Menifee  Riverside  0.032%  0.0260909%
City  Moreno Valley  Riverside  0.137%  0.1130348%
City  Murrieta  Riverside  0.048%  0.059%  0.0497423%
City  Norco  Riverside  0.016%  0.0134542% City  Palm Desert  Riverside  0.083%  0.0682465% City  Palm Springs  Riverside  0.076%  0.0629862% City  Perris  Riverside  0.009%  0.0076774% City  Rancho Mirage  Riverside  0.052%  0.0431098% City  Riverside  Riverside  0.268%  0.2206279%
City  San Jacinto  Riverside  0.010%  0.0085936%
City  Temecula  Riverside  0.022%  0.0180086% City  Wildomar  Riverside  0.008%  0.0062500% County  Sacramento County Sacramento  3.797%  4.645%  3.9465887% 9 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Citrus Heights  Sacramento  0.057%  0.0465312% City  Elk Grove  Sacramento  0.130%  0.1066994% City  Folsom  Sacramento  0.108%  0.0890850% City  Galt  Sacramento  0.017%  0.0143704% City  Rancho Cordova  Sacramento  0.008%  0.0067679% City  Sacramento  Sacramento  0.721%  0.882%  0.7496530% County  San Benito County San Benito  0.106%  0.130%  0.1101417% City  Hollister  San Benito  0.027%  0.0225355%
County  San Bernardino County San Bernardino  3.259%  3.987%  3.3878124% City  Adelanto  San Bernardino  0.008%  0.0066640%
City  Apple Valley  San Bernardino  0.025%  0.0207360%
City  Barstow  San Bernardino  0.015%  0.0122056% City  Chino  San Bernardino  0.064%  0.0525893% City  Chino Hills  San Bernardino  0.001%  0.0006388% City  Colton  San Bernardino  0.031%  0.0253443% City  Fontana  San Bernardino  0.112%  0.0920543% City  Grand Terrace  San Bernardino  0.006%  0.0051051% City  Hesperia  San Bernardino  0.035%  0.0291522% City  Highland  San Bernardino  0.004%  0.0029061% City  Loma Linda  San Bernardino  0.009%  0.0071188% City  Montclair  San Bernardino  0.039%  0.0322108% City  Ontario  San Bernardino  0.179%  0.1472934% City  Rancho Cucamonga  San Bernardino  0.084%  0.0689431% City  Redlands  San Bernardino  0.057%  0.0469150% City  Rialto  San Bernardino  0.073%  0.0603206% City  San Bernardino  San Bernardino  0.178%  0.1461880% City  Twentynine Palms  San Bernardino  0.002%  0.0012605% City  Upland  San Bernardino  0.052%  0.0424460% City  Victorville  San Bernardino  0.033%  0.0269400% City  Yucaipa  San Bernardino  0.016%  0.0128772% 10 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Yucca Valley  San Bernardino  0.003%  0.0021228%
County  San Diego County San Diego  5.706%  6.980%  5.9309748% City  Carlsbad  San Diego  0.128%  0.1050485%
City  Chula Vista  San Diego  0.189%  0.231%  0.1961456% City  Coronado  San Diego  0.044%  0.0359095% City  El Cajon  San Diego  0.113%  0.0933582% City  Encinitas  San Diego  0.061%  0.074%  0.0630289% City  Escondido  San Diego  0.145%  0.1192204% City  Imperial Beach  San Diego  0.014%  0.0118283%
City  La Mesa  San Diego  0.055%  0.068%  0.0575593%
City  Lemon Grove  San Diego  0.022%  0.0183911% City  National City  San Diego  0.080%  0.0656808% City  Oceanside  San Diego  0.213%  0.1753428% City  Poway  San Diego  0.062%  0.0511040% City  San Diego  San Diego  1.975%  2.416%  2.0531169% City  San Marcos  San Diego  0.089%  0.0733897% City  Santee  San Diego  0.033%  0.0268401% City  Solana Beach  San Diego  0.017%  0.0138564% City  Vista  San Diego  0.052%  0.0425144% Consolidated  San Francisco San Francisco  3.026%  3.702%  3.1457169% County  San Joaquin County San Joaquin  1.680%  2.055%  1.7460399% City  Lathrop  San Joaquin  0.009%  0.0075394%
City  Lodi  San Joaquin  0.053%  0.0439484%
City  Manteca  San Joaquin  0.054%  0.0443454% City  Ripon  San Joaquin  0.013%  0.0104219% City  Stockton  San Joaquin  0.313%  0.383%  0.3256176% City  Tracy  San Joaquin  0.084%  0.0692047%
County  San Luis Obispo County San Luis Obispo  0.816%  0.999%  0.8484126% City  Arroyo Grande  San Luis Obispo  0.024%  0.0199053% City  Atascadero  San Luis Obispo  0.029%  0.0240680% 11 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  El Paso de Robles (Paso Robles)  San Luis Obispo  0.043%  0.0353456% City  Grover Beach  San Luis Obispo  0.017%  0.0137881% City  Morro Bay  San Luis Obispo  0.020%  0.0160922% City  San Luis Obispo  San Luis Obispo  0.077%  0.0637841% County  San Mateo County San Mateo  1.074%  1.313%  1.1159599% City  Belmont  San Mateo  0.021%  0.0169860% City  Burlingame  San Mateo  0.019%  0.0152537% City  Daly City  San Mateo  0.044%  0.0363880% City  East Palo Alto  San Mateo  0.013%  0.0103982% City  Foster City  San Mateo  0.020%  0.0166101% City  Half Moon Bay  San Mateo  0.004%  0.0031638%
City  Hillsborough  San Mateo  0.013%  0.0110029%
City  Menlo Park  San Mateo  0.015%  0.0126209%
City  Millbrae  San Mateo  0.013%  0.0105836% City  Pacifica  San Mateo  0.016%  0.0130625% City  Redwood City  San Mateo  0.056%  0.0463511% City  San Bruno  San Mateo  0.021%  0.0172161%
City  San Carlos  San Mateo  0.013%  0.0108885%
City  San Mateo  San Mateo  0.052%  0.0425841%
City  South San Francisco  San Mateo  0.043%  0.0353943% County  Santa Barbara County Santa Barbara  1.132%  1.385%  1.1768968% City  Carpinteria  Santa Barbara  0.001%  0.0008938%
City  Goleta  Santa Barbara  0.004%  0.0028969% City  Lompoc  Santa Barbara  0.047%  0.0389379% City  Santa Barbara  Santa Barbara  0.122%  0.1004559% City  Santa Maria  Santa Barbara  0.058%  0.0479179% County  Santa Clara County Santa Clara  2.404%  2.941%  2.4987553% City  Campbell  Santa Clara  0.014%  0.0112566% City  Cupertino  Santa Clara  0.008%  0.0066824% City  Gilroy  Santa Clara  0.025%  0.0202891% 12 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Los Altos  Santa Clara  0.013%  0.0103338% City  Los Gatos  Santa Clara  0.013%  0.0103220% City  Milpitas  Santa Clara  0.036%  0.0298120% City  Morgan Hill  Santa Clara  0.015%  0.0124619% City  Mountain View  Santa Clara  0.041%  0.0334608% City  Palo Alto  Santa Clara  0.039%  0.0323080% City  San Jose  Santa Clara  0.294%  0.360%  0.3054960% City  Santa Clara  Santa Clara  0.067%  0.0549723%
City  Saratoga  Santa Clara  0.004%  0.0034161% City  Sunnyvale  Santa Clara  0.053%  0.0434069% County  Santa Cruz County Santa Cruz  0.783%  0.957%  0.8135396% City  Capitola  Santa Cruz  0.020%  0.0168191% City  Santa Cruz  Santa Cruz  0.143%  0.1180348% City  Scotts Valley  Santa Cruz  0.015%  0.0126525%
City  Watsonville  Santa Cruz  0.063%  0.0520136%
County  Shasta County Shasta  1.095%  1.339%  1.1380191% City  Anderson  Shasta  0.024%  0.0198896% City  Redding  Shasta  0.284%  0.2334841% City  Shasta Lake  Shasta  0.004%  0.0031993%
County  Siskiyou County Siskiyou  0.228%  0.279%  0.2373393% County  Solano County Solano  0.760%  0.6260795% City  Benicia  Solano  0.031%  0.0253903%
City  Dixon  Solano  0.016%  0.0130849% City  Fairfield  Solano  0.109%  0.0897317% City  Suisun City  Solano  0.021%  0.0176183% City  Vacaville  Solano  0.119%  0.0976497%
City  Vallejo  Solano  0.167%  0.1373644%
County  Sonoma County Sonoma  1.218%  1.490%  1.2661290% City  Healdsburg  Sonoma  0.032%  0.0266929%
City  Petaluma  Sonoma  0.081%  0.0667507%
13 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Rohnert Park  Sonoma  0.041%  0.0340759%
City  Santa Rosa  Sonoma  0.184%  0.1519070%
City  Sonoma  Sonoma  0.022%  0.0183438%
City  Windsor  Sonoma  0.016%  0.0129298%
County  Stanislaus County Stanislaus  1.722%  1.4182273% City  Ceres  Stanislaus  0.041%  0.0340260%
City  Modesto  Stanislaus  0.217%  0.1788759%
City  Newman  Stanislaus  0.006%  0.0046964%
City  Oakdale  Stanislaus  0.018%  0.0145531%
City  Patterson  Stanislaus  0.015%  0.0126590%
City  Riverbank  Stanislaus  0.010%  0.0085699%
City  Turlock  Stanislaus  0.065%  0.0531966%
County  Sutter County Sutter  0.306%  0.374%  0.3179548% City  Yuba City  Sutter  0.074%  0.0606242%
County  Tehama County Tehama  0.213%  0.261%  0.2216654% City  Red Bluff  Tehama  0.014%  0.0117771%
County  Trinity County Trinity  0.082%  0.101%  0.0855476% County  Tulare County Tulare  0.809%  0.990%  0.8410949% City  Dinuba  Tulare  0.014%  0.0116929%
City  Exeter  Tulare  0.004%  0.0032479%
City  Farmersville  Tulare  0.003%  0.0027879% City  Lindsay  Tulare  0.007%  0.0057111% City  Porterville  Tulare  0.021%  0.0171845% City  Tulare  Tulare  0.037%  0.0302273% City  Visalia  Tulare  0.066%  0.0545872%
County  Tuolumne County Tuolumne  0.486%  0.594%  0.5047621% County  Ventura County Ventura  2.192%  2.681%  2.2781201% City  Camarillo  Ventura  0.002%  0.0012815%
City  Fillmore  Ventura  0.002%  0.0020294% City  Moorpark  Ventura  0.008%  0.0067337% 14 of 15

APPENDIX 1
Participating
Subdivision
Classification
Participating Subdivision County Abatement Percentage Plaintiff Subdivision Percentage Weighted Allcation Percentage City  Oxnard  Ventura  0.156%  0.190%  0.1617338%
City  Port Hueneme  Ventura  0.021%  0.0174145%
City  San Buenaventura (Ventura)  Ventura  0.085%  0.0702181% City  Santa Paula  Ventura  0.014%  0.0119072% City  Simi Valley  Ventura  0.065%  0.0533043% City  Thousand Oaks  Ventura  0.022%  0.0179902% County  Yolo County Yolo  0.357%  0.437%  0.3713319%
City  Davis  Yolo  0.055%  0.0451747% City  West Sacramento  Yolo  0.066%  0.0544321% City  Woodland  Yolo  0.058%  0.0477904% County  Yuba County Yuba  0.214%  0.262%  0.2225679%
City  Marysville  Yuba  0.014%  0.0112079%
15 of 15

APPENDIX 2
Cost Reimbursement Procedure

1. Additional defined terms:
a) Costs means the reasonable amounts paid for the attorney and other City Attorney and County Counsel staff time for individuals employed by a Plaintiff Subdivision at the contractual rate, inclusive of benefits and overhead, together with amounts paid for court reporters, experts, copying, electronic research, travel, vendors, and the like, which were not previously reimbursed and which were paid or incurred (i) prior to December 31, 2022 in litigation against any Opioid Defendant and/or (ii) in negotiating and drafting any CA Allocation Agreement(s) concerning a settlement with any Opioid Defendant(s).

Costs does not include attorneys’ fees, costs, or expenses incurred by private contingency fee counsel. No part of the CA Abatement Accounts Fund will be used to reimburse Costs.
b) First Claims Date means October 1, 2023 or when all applications for reimbursement of Costs, in whole or in part, from funds available under Section IX and Exhibit R of the Walgreens Settlement Agreement, Section XIV and Exhibit R of the Teva Settlement Agreement, Section XIII and Exhibit R of the Allergan Settlement Agreement, Section X and Exhibit R of the Distributor Settlement Agreement, Section XI and Exhibit R of the Janssen Settlement Agreement, Section X and Exhibit R of the CVS Settlement Agreement, or Section IX and Exhibit R of the Walmart Settlement Agreement, have been finally determined under the provisions of those agreements, whichever comes first. c) Special Master means a retired judicial officer or former public lawyer, not presently employed or retained by a Plaintiff Subdivision, who will aggregate, review, and determine the reasonable Costs to be awarded to each Plaintiff Subdivision that submits a claim for reimbursement of Costs. The Special Master will be selected by a majority vote of the votes cast by Plaintiff Subdivisions, with each such subdivision having one vote. d) Plaintiff Subdivision Committee means the committee of Plaintiff Subdivisions that will review and approve the invoices submitted by the Special Master reflecting his or her reasonable time and expenses.

2. Cost Reimbursement to Plaintiff Subdivision
a) Purpose. Substantial resources have been expended to hold Opioid Defendants accountable for creating and profiting from the opioid crisis, and this effort has been a significant catalyst in creating National Opioid Settlements with various manufacturers, distributors, and chain pharmacies.
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1 Page 586 of 591

b) Claims Procedure.
i. If a Plaintiff Subdivision is eligible to seek reimbursement of Costs, in whole or in part, from funds available under Section IX and Exhibit R of the Kroger Settlement Agreement, Section IX and Exhibit R of the Walgreens Settlement Agreement, Section XIV and Exhibit R of the Teva Settlement Agreement, Section XIII and Exhibit R of the Allergan Settlement Agreement, Section X and Exhibit R of the CVS Settlement Agreement, Section IX and Exhibit R of the Walmart Settlement Agreement, Section X or Exhibit R of the Distributor Settlement Agreement, or Section XI or Exhibit R of the Janssen Settlement Agreement, it must first make a timely application for reimbursement from such funds. To allow sufficient time for determination of those applications, no claim for Costs to the CA Subdivision Fund under this Agreement may be made before the First Claims Date. ii. A Plaintiff Subdivision that wishes to be reimbursed from the CA Subdivision Fund must submit a claim to the Special Master no later than forty-five (45) days after the First Claims Date. The Special Master will then compile and redistribute the aggregated claim totals for each Plaintiff Subdivision via email to representatives of all the Plaintiff Subdivisions. A claim for attorney and staff time must list, for each attorney or staff member included in the claim, the following information: name, title, total hours claimed, hourly rate (including, if sought, benefits and share of overhead), and narrative summarizing the general nature of the work performed by the attorney or staff member. For reimbursement of “hard” costs, the subdivision may aggregate across a category (e.g., total for travel costs). It is the intention of the Plaintiff Subdivisions that submission of documents related to reimbursement of Costs does not waive any attorney-client privilege or exemptions to the California Public Records Act.
iii. The Special Master may request, at his or her sole option, additional documents or details to assist in the final award of Costs.
iv. The Special Master will review claims for reasonableness and will notify each Plaintiff Subdivision of the final determination of its claim, and will provide a list of all final awards to all Plaintiff Subdivisions by email or, upon request, via First Class U.S. Mail. Any Plaintiff Subdivision may ask the Special Master to reconsider any final award within twenty-one (21) days. The Special Master will make a final determination on any such reconsideration request within thirty (30) days of receipt. v. Any decision of the Special Master is final and binding, and will be considered under the California Arbitration Act, Code of Civil Procedure section 1280 et seq. as a final arbitration award. Nothing in this agreement is intended to expand the scope of judicial review of the final award for errors of fact or law, and the Parties agree that they may only seek to vacate the award if clear and convincing evidence demonstrates one of the factors set forth in Code of Civil Procedure, section 1286.2, subdivision (a). Plaintiff Subdivisions will have fourteen (14) days after all final awards are made, together with any final determination of a request for 2 Page 587 of 591

reconsideration, to seek review in the Superior Court of California, pursuant to Code of Civil Procedure, section 1285, where the State has filed its Consent Judgment. vi. The Special Master will prepare a report of Costs that includes his or her fees and expenses at least ninety (90) days before the Payment Date for each Annual Payment. The Special Master’s preparation of a report of Costs does not discharge a Plaintiff Subdivision’s reporting requirement under Section V(B)(2) of the Kroger Settlement Agreement.
vii. A member of the Plaintiff Subdivision Committee, which is a CA Participating Subdivision, will submit to the Settlement Fund Administrator and Kroger a report of the fees and expenses incurred by the Special Master pursuant to Section V(B)(2) of the Kroger Settlement Agreement.
c) Claims Priority and Limitation.
i. The Special Master will submit invoices for compensation of reasonable fees and expenses to the Plaintiff Subdivision Committee no later than ninety (90) days prior to the Payment Date for each Annual Payment. The Plaintiff Subdivision Committee will promptly review and, if reasonable, approve the Special Master’s invoice for compensation. The Plaintiff Subdivision Committee will submit approved invoices to the Settlement Fund Administrator for payment. The Special Master’s approved invoices have priority and will be paid first from the CA Subdivision Fund before any award of Costs, subject to the limitation in Section 2.c.v below. ii. Final Awards of Costs that do not exceed seventy-five thousand dollars ($75,000.00) will be paid next in priority after the Special Master’s approved invoices.
iii. Final Awards of Costs in excess of seventy-five thousand dollars ($75,000.00) will be paid proportionally from the funds remaining in that year’s Annual Payment. iv. Any claim for Costs that is not paid in full will be allocated against the next year’s distribution from the CA Subdivision Fund, until all approved claims for Costs are paid in full.
v. In no event will more than 50% of the total CA Subdivision Fund received in any year be used to pay Costs or the Special Master’s approved invoices. vi. In no event shall more than $28 million of the total CA Subdivision Funds paid pursuant to the Kroger Settlement Agreement, Walgreens Settlement Agreement, Teva Settlement Agreement, Allergan Settlement Agreement, Distributor Settlement Agreement, CVS Settlement Agreement, Janssen Settlement Agreement, and the Walmart Settlement Agreement be used to pay Costs.
3 Page 588 of 591
d) Collateral Source Payments and Third-Party Settlement. i. In the event a Plaintiff Subdivision is awarded compensation, in whole or in part, by any source of funds created as a result of litigation against an Opioid Defendant for its reasonable Costs, it will reduce its claim for Costs from the CA Subdivision Fund by that amount. If a Plaintiff Subdivision has already received a final award of Costs from the CA Subdivision Fund, it will repay the fund up to the prior award of Costs via a payment to the Settlement Fund Administrator or notify the Settlement Fund Administrator that its allocation from the next and subsequent Annual Payments should be reduced accordingly. If the Plaintiff Subdivision is repaying any prior award of Costs, that repayment will occur as soon as is feasible after the Plaintiff Subdivision’s receipt of Cost funds from the collateral source, but no more than 90 days after its receipt from the collateral source. The Settlement Fund Administrator will add any repaid Costs to the CA Subdivision Fund. Any Plaintiff Subdivision that has submitted for reimbursement to any national fund and has not received a final determination by the First Claims Date may request that the settlement administrator withhold some or all of its payment from the CA Subdivision Fund in order to avoid repayment.
ii. In the event a Plaintiff Subdivision reaches a monetary settlement or compromise against any Opioid Defendant outside of the National Opioid Settlement, the monetary portion of such settlement, net of fees paid to outside contingency fee counsel and of funds earmarked strictly for abatement, will be credited against its Costs and the subdivision will be ineligible to recover those credited Costs from the CA Subdivision Fund. Plaintiff Subdivisions negotiating monetary settlements or compromises against any Opioid Defendant outside of the National Opioid Settlement will negotiate for funds to repay any Costs it previously received from the CA Subdivision Fund or for Costs it otherwise might be eligible to claim from the CA Subdivision Fund. If such a settlement is paid after all final approved claims for Costs by all Plaintiff Subdivisions are satisfied in full, the settling subdivision will reimburse the CA Subdivision Fund in that amount by making payment to the Settlement Fund Administrator to add to the CA Subdivision Fund in a manner consistent with the repayments described in section 2.d.i above. 4 Page 589 of 591

APPENDIX 3

CALIFORNIA-SUBDIVISION BACKSTOP AGREEMENT
On August 6, 2021, Judge Polster of the US District Court for the Northern District of Ohio issued an Order (the Order), docket number 3814, in In Re National Prescription Opiate Litigation, MDL 2804, addressing contingent attorney fee contracts between political subdivisions eligible to participate in the Kroger Settlement and their counsel.

In light of the Order, and at the request of [SUBDIVISION], the [SUBDIVISION], its counsel [COUNSEL], and the California Attorney General, on behalf of the State of California, are entering into this California-Subdivision Backstop Agreement (Backstop Agreement). [SUBDIVISION] and [COUNSEL] intend this Backstop Agreement to constitute a State BackStop Agreement as that term is used in the Order and in Exhibit R (Agreement on Attorneys’ Fees, Costs, and Expenses) of the Kroger Settlement Agreement.

Pursuant to this Backstop Agreement, [SUBDIVISION] may, subject to the limitations of the Kroger Settlement Agreement and CA Kroger Allocation Agreement, as well as any other limitations imposed by law, use funds that it receives from the Kroger Settlement CA Subdivision Fund to pay a contingent fee to [COUNSEL]. Any such payment from [SUBDIVISION] to [COUNSEL], together with any contingency fees that [COUNSEL] may receive from the national Attorney Fee Fund, will not exceed a total contingency fee of [PERCENTAGE NOT TO EXCEED 15%] of the total gross recovery of [SUBDIVISION] from the Kroger Settlement.
[COUNSEL] certify that they first sought fees and costs from the Attorney Fee Fund created under the Kroger Settlement Agreement before seeking or accepting payment under this backstop agreement. [COUNSEL] further certify that they are not seeking and will not accept payment under this backstop agreement of any litigation fees or costs that have been reimbursed through prior settlements or judgments.

The Attorney General is executing this agreement solely because the definition of “State BackStop Agreement” in Exhibit R of the Kroger Settlement Agreement requires such agreements to be between “a Settling State” and private counsel for a participating subdivision. Neither the California Attorney General nor the State of California have any obligations under this Backstop Agreement, and this Backstop Agreement does not require the payment of any state funds to [SUBDIVISION], [COUNSEL], or any other party.
[DATE] [SUBDIVISION SIGNATURE BLOCK]
[DATE] [COUNSEL SIGNATURE BLOCK]
[DATE] [ATTORNEY GENERAL SIGNATURE BLOCK]
1 Page 590 of 591

STAFF REPORT
TO: City Council
FROM: City Manager
FOR MEETING: Jul 23 2024
SUBJECT: July 14-15, 2024 Monsoonal Storm.

RECOMMENDATION:

The City Council review any item relating to the storm that occurred on July 14-15, 2024, and provide direction on how to proceed if needed.

ORDER OF PROCEDURE:

Request Staff Report (City Manager Presenting)
Council Questions of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question (voice vote)
BACKGROUND:

The City Manager's Office may have an item(s) requiring City Council review, discussion, and approval.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

N/A
FISCAL IMPACT:

N/A