ADMINISTRATIVE OF AGREEMENT This Administrative: Memorandum of Agreement (?Agreement?) is entered into by and between the United States Department of Justice, Drug Enforcement Administration (hereinafter and Wal-Mart Stores, Inc., on its behalf as well as on behalf of its subsidiaries that . operate pharmacies registered with DEA in the United States and its territories {hereinafter - ?Walmart?} (each a ?Party? and collectively hereinafter referred to as the ?Parties"). 1. APPLICABILITY This agreement shall be applicable to all current and future Walmart Pharmacy locations registered with the DEA to dispense controlled substances. IL BACKGROUND On November 13, 2009, the Deputy Assistant Administrator, Office of Diversion Control, DEA, issued an Order to Show Cause proposing to revoke DEA Certi?cate of registration of Walmart Pharmacy #10-217? located at 3382 Murphy Canyon Road, San Diego, California 92123. The DTSC alleged that Walmart Pharmacy #1 improperly dispensed controlled substances to individuals based on purported prescriptions issued by physicians who were not licensed to practice medicine in California; dispensed controlled substances to individuals located in California based on Internet prescriptions issued by physicians for other than a legitimate medical purpose andfor outside the usual course of professional practice in violation of federal and state law; and dispensed controlled substances to individuals that Walmart Pharmacy sic-217? knew or should have known were diverting the controlled substances. Appendix A dated November 13. 20W). In addition to the allegations raised in the OTSC, investigation also revealed that Walmart Pharmacy #1 0?217? was allegedly dispensing controlled substances based on prescriptions that contained expired, suspended, andfor invalid DEA numbers and that Walmart Pharmacy #l?-El T7 was allegedly re?lling prescriptions for controlled substances too early. The DTSC was served via Certi?ed Mail, Return Receipt Requested on November 18, 2009. On December 16, 2009, Walmart Pharmacy #10-2177, through counsel, ?led a hearing request with the Administrative Law Judge, wherein Walmart Pharmacy #1 0-211"! disputed the factual allegations of the OTSC and disagreed with DEA's position that the DEA registration of Walmart Pharmacy #1 0?217"? should be revoked. See Appendix {Request for Hearing dated December 16, 2009). The facts alleged above and in the OTSC could, if proven at hearing, constitute a basis to revoke the DEA registration of Walrnart Pharmacy #1 0-2 TI. The Parties, however, desire to settle the administrative matter pending against Walmart Pharmacy Moreover, the lof?? Parties believe that the continued cooperation between the Parties to reduce the potential for diversion is in the public interest. In consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, and intending to be legally bound hereby, the Patties hereto agree as follows: Ill. TERMS AND CONDITIONS 1. lnterttien of Parties to Effect Settlement. In order to avoid the uncertainty and expense of litigation, the Parties agree to resolve this matter according to the Terms and Conditions below. 2. N9 amissign or This Agreement is neither an admission by Walmart of liability or of any allegations made by DEA in the OTSC and its investigation of Walmart Pharmacy #10-21 nor a concession by DEA that its allegations in OTSC and its investigation of Walmart Pharmacy #1 [Ii-21?? are not well-founded. 3. lCovered Conduct for Purposes of this Agreement. ?Covered Conduct? shall mean the conduct at Pharmacy #10-2177 as alleged in the OTSC and conduct discovered during the course ofDEA?s investigation as described in Section 11 above. 4. Obligations of Walmartt a. Walmart agrees to maintain a compliance program, updated as necessary, designed to detect and prevent diversion of controlled substances as required by the Controlled Substances Act and applicable DEA regulations. This program shall include procedures to identify the common signs associated with the diversion ofcontrolled substances including but not limited to, doctor-shopping, requests for early re?lls, altered or forged prescriptions, prescriptions written by doctors not licensed to practice medicine in the jurisdiction where the patient is located, and prescriptions written for other than a legitimate medical purpose by an individual practitioner acting outside the usual course of his professional practice. The program shall also include procedures to report thefts and significant losses of controlled substances pursuant to 2] (LEE. 1301.T6(b} and the routine and periodic training of all Walmart employees, including new employees, responsible for controlled substances regarding their responsibilities under the CSA and regarding relevant elements of the compliance program. This compliance program shall apply to all current and future Walmart pharmacies registered with the DEA. Walmart acknowledges and agrees that the obligations undertaken in this subparagraph do not ful?ll the totality of its obligations under the and its implementing regulations. b. Walmart shall notify the local DEA of?ce within seven business days eta refusal to fill a prescription for controlled substances where such refusal is based on the Walmart phannacist's at?tin-native conclusion that the prescription was forged, altered, or issued for other than a legitimate medical purpose by a practitioner acting 20f? outside the usual course of professional practice. Noti?cation by facsimile will be considered suf?cient notice for purposes of this paragraph. . Walmart shall implement and maintain policies and procedures designed to ensure that its pharmacies comply with all applicable laws requiring pharmacists to obtain current identi?cation from a person picking up controlled substance prescriptions. If required to do so by law, Walmart shall record and maintain identifying information. Such identifying information shall be readily retrievable and maintained for the period required by applicable state law, and 1Walmart shall make such information available to DEA agents, task force officers andr'or investigators upon request for inspection and copying. . Walmart shall comply with all state and federal laws and regulations with regard to dispensing controlled substances based on a prescription written or otherwise transmitted by a prescriber located outside of the state where the patient and pharmacy are located. Walmart shall require its pharmacists to comply with all applicable federal and state law and satisfy himself or herself that a valid docton?patient relationship exists before ?lling a prescription for controlled substances. Walmart shall implement procedures to routinely verify that the DEA registration number on a prescription is a valid, active DEA registration number, independent of calling the local DEA office. Such verification may be performed using the NTIS or similarly-reliable third party database where DEA registration changes are recorded or via Office of Diversion Control website. This Agreement shall not require Wahnart to call the DEA or any local DEA of?ce to verify a DEA registration number. Walmart understands and acknowledges that 21 C. F. R. ?130?. (14 applies to all Walmart pharmacists who ?ll prescriptions. Walmart shall make the records that it is required to keep pursuant to the CSA and implementing regulations available to DEA agents, task force officers andfor investigators upon request, provided that the'agent, of?cer, or investigator presents his or her DEA credentials. . Dispensing records submitted to Prescription Monitoring Programs {in those states that have or will implement such a system} shall contain a valid, active DEA registration number, verified pursuant to subparagraph above, if state law requires that such number he provided. . Walman shall maintain and enforce a policy that allows and encourages its pharmacists to obtain and review a patient doctor pro?le from the Prescription Monitoring Program [if such information is available to the pharmacy] prior to dispensing controlled substances if the pharmacist believes, in the exercise of his or her professional judgment, that the data will assist him or her in determining the appropriateness of filling a prescription for controlled substances. 3of?i' i. Walmart shall institute policies and procedures to block the early re?ll of controlled substances. Walmart?s system may allow pharmacists to override a block and to re?ll a prescription early provided that the pharmacist provides a reasonable explanation for the override. 1ir?t?alrnart shall direct its pharmacists that, prior to oveniding any block to re?ll a prescription for a controlled substance, the pharmacist shall satisfy himself or herself that there are no mitigating factors which counsel against the re?ll. In the exercise of his or her professional judgment, pharmacists may, but are not required to, consult Prescription Monitoring Program information {if such information is available). Walmart shall maintain a record of the explanation for each override. The record of each override will he linked to the original prescription. These records shall be readily retrievahle and maintained for a period of two years, and Walmart shall make such in formation available to DEA agents, task force of?cers andr?or investigators upon request for inspection and copying. Further, pursuant to 21 C.F.R. 1306.12, nothing in this paragraph shall be construed to permit the early ?lling of prescriptions for Schedule II controlled substances. j. shall install security cameras in all Walmart Pharmacy locations that capture images of all transactions at the pharmacy counter, including drive-thin windows, if applicable. The recordings from the security cameras shall be maintained for a period of not less than thirty (30} days, shall be readily retricyable by Walmart, and shall be produced to DEA agents, task force of?cers andfor investigators upon request. k. Walmatt shall report to the local DEA office, within thirty {30) calendar days after discovery, the initiation of any of?cial legal proceeding known to Walmart conducted or brought by a government entity or licensing board against Walmart regarding the dispensing of connolled substances or sale of schedule listed chemical products, provided that Walmart has not already reported the events underlying the proceeding to the DEA. Release by DEA. in consideration of the ful?llment of the obligations of Walmart under this Agreement, DEA hereby releases Walmart item liability and agrees to refrain from ?ling any administrative actions against Walmart?s DEA registrations based on the Covered Conduct or similar conduct at any other Walmart pharmacy on or before the date of the Agreement, within DEA's enforcement authority under 21 U.S.C. 323 and 324. Notwithstanding the release by DEA contained in this Paragraph, DEA reserves the right to seek to admit evidence of the Covered lConduct in any other administrative proceedings. Further, nothing in this Paragraph shall prohibit any other agency within the Department of Justice, any State attorney general, or any other law enforcement, administrative, or regulatory agency of the United States or any State or political subdivision thereof (?law enforcement agency"), from initiating administrative, civil, or criminal proceedings with respect to the Covered Conduct. DEA shall, as obligated in ful?lling its statutory duties, assist and cooperate with any law enforcement agency that initiates an investigation, action, or proceeding, involving the Covered Conduct. At Walmart?s request, DEA agrees to disclose the terms of this Agreement to any other law 4of'? 10. ll. 12. enforcement agency and will represent that Walmart?s compliance with this Agreement adequately addressed the allegations raised in the administrative proceedings by DEA as de?ned in the lCovered IConduct. Release by Walmart. Walmart fully and ?nally releases the United States of America, its agencies, employees, servants, and agents from any claims (including attomey?s fees, costs, and expenses of every kind and however denominated) whjeh Walmart has asserted, could have asserted, or may assert in the future against the United States of America, its agencies, employees, servants, and agents, related to the Covered Conduct and the United States" investigation and prosecution thereof. Material Breach. A single, inadvertent or negligent failure by Walmart to perform any of the actions contemplated by this Agreement shall not be considered a breach of this Agreement. Reservation efClaims. Notwithstanding any term of this Agreement, speci?cally reserved and excluded from the scope and terms of this Agreement as to any entity or person (including Walmart) are the following: a. Any civil, criminal, or administrative liability arising under Title 26, U.S. Code (Internal Revenue Code}; b. Any liability to the United States (or its agencies} for any conduct other than the Covered Conductor similar conduct subject to paragraph 5 of the Agreement; c. Any liability based upon such obligations as are created by this Agreement. Binding on Successors. This Agreement shall inure to the bene?t of and is binding on Walmart, and its respective successors, heirs, transferees and assigns. Costs. Each Party to this Agreement shall bear its own legal and other costs incurred in connection with this matter, including the preparation and performance of this Agreement. No Additional Releases. This Agreement is intended to be for the benefit of the Parties and Released Parties only and by this instrument the Parties do not release any claims against any other person or entity other than the Released Parties. Effect of Agreement. This Agreement constitutes the complete agreement between the Parties. All material representations, understandings, and promises of the Parties are contained in this Agreement, and each of the parties expressly agrees and acknowledges that, other than those statements expressly set forth in this Agreement, it is not relying on any statement, whether oral or written, of any person or entity with respect to its entry into this Agreement or to the consummation of the transactions contemplated by this Agreement. Any modi?cations to this Agreement shall be set forth in writing and signed by all Parties. Each Party represents that this Agreement is entered into with advice of counsel and knowledge of the events described herein. Walmart further represents that this Agreement is voluntarily entered into in order to avoid litigation, without duress or compulsion. Set? 13. 14. 15. of Agreement. This Agreement shall heeome effeetive ?nal and binding} on the date of signing by the last signatory [the ?Effective Date?), and remain in effect for a period of four years from the Effective Date. DEA agrees to notify Walmart inunediately when the ?ns] signatory has exeeuted this Agreement. Eaeggtign in Counterparts. This Agreement may he exeeuterl in counterparts, eaeh of which constitutes an original, and all ot?whieh constitute one and the same agreement. Authorizations. The individuals signing this Agreement on behalf of Walrnart represent and warrant that they are authorized by Walmart to this Agreement. The individuals aiming this Agreement on behalf of DEA represent and warrant that they are signing this Agreement in their of?eial eapaeities and that the}r are authorized by DEA to ex eeute this Agreement. dot"? IN WITNESS WHEREDF, the Panits haw: 4:11:13,r executed this Adminislmlivc Memorandmn sf Agreemmt. INC. Dr. John Senior VP and Pmsident, Health 3: Wellness Stores, Inc. Dated: King a: Spalding LLP Attorneys for Wat-Mm Stores, Inc. THE UNITED STATES DEPARTMENT OF JUSTICE DRUG ABMNISTRATIDN ?25101! H. Gocaf 'ei?Cuunsel Dated: 051: ?f r? ?Faf?