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What cases does this MOV apply? This allocation agreement is intended to govern the distribution of settlement proceeds obtained through the Purdue Pharma L.P. ("Purdue") bankruptcy, the Mallinckrodt PLC ("Mallinckrodt") bankruptcy, the distributor (Cardinal Health, Inc., McKesson Corp., and AmcrisourceBergen Corp. (collectively referred to as the "Distributors")) and Johnson & Johnson ("J&J") potential deal, as well as any additional settlements obtained related to the opioid litigation. Why is an allocation agreement necessary and why now? Almost 100 political subdivisions within the State of Florida, as well as the State of Florida itself. have filed shit against numerous entities engaged in the manufacture, marketing, promotion, distribution or dispensing of opioids. Another 30 political subdivisions within the State of 11orida have filed claims in the Purdue bankruptcy. The State and the Plaintiffs' Executive Committee for the Opioid Litigation Multi - District Litigation panel (the "PLC') are in ongoing negotiations with Purdue, Mallinckrodt, the Distributors, and J&J with potential resolutions anticipated in the coming weeks. Under the likely settlement structure for these cases, states and their political subdivisions are strongly incentivized to reach a joint resolution of all State and political subdivision claims. Under the Distributor and J&J deal, the State and its subdivisions receive a substantially larger settlement amount the higher the number of subdivisions sign on to the deal. Therefore, it is in the best interest of all political subdivisions and the State of Florida to reach an allocation agreement which will permit the joint resolution of all claims within the state. The deals contemplate the need for relatively quick buy in by subdivisions in order to maximize recovery. The pace of negotiations is accelerating, and Purdue has riled its plan of reorganization. Given this accelerating pace, there is a greater sense of urgency among all counsel to come to agreement and resolve how monies are going to be allocated, so that we can move .Purdue, Mallinckrodt, and other potential settlements toward finality. Given the Sunshine law, the likely need for public notice and comment, and the complexity of the deals, we need to agree to an allocation plan now to ensure that Florida maximizes recovery. How can funds be utilized? You will see as you review the MOU that the State and its subdivisions, who execute this MOU, are agreeing that almost all the funds from anv settlement will go to abatement activities. In other words, finds must be utilized for strategics, programming and services used to expand the availability of treatment for individuals impacted by Opioid Use Disorder or co-occurring Substance Use Disorder and Mental Health disorders ("Approved Purposes"). A non-exclusive list of potential abatement programs and uses are included in Exhibits A and 13 to the agreement. The list was developed nationally consulting with public health officials in multiple states, experts for the states and subdivisions, and officials within the United States Department of Health and Human Services. These uses are intended to best serve the overall purpose and Page 2 of 7 54