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Modern Slavery Act

Disclosure under the California Transparency in Supply Chains Act and UK Modern Slavery Act

This Statement relates to our fiscal year ended September 30, 2019 (“fiscal 2019”) except as otherwise updated herein. This Statement describes the activities of Aniiiqa Inc and its consolidated subsidiaries (collectively, “Aniiiqa Inc,” the “Company,” “we” or “our”) to address modern slavery risks in our business and supply chains. We have prepared a single consolidated statement for all of our brands because we generally employ the same modern slavery policies and compliance program across our entire business.

As used in this statement, “modern slavery” encompasses the risks posed by forced labor, prison labor, indentured labor, bonded labor, debt servitude, state imposed forced labor and human trafficking, where coercion, threats or deception are used to intimidate, penalize or deceive workers, thereby creating situations of involuntary work and exploitation. Modern slavery may also be associated with the worst forms of child labor.

We conduct business in over 100 countries and most of our consolidated subsidiaries are not subject to the California Transparency in Supply Chains Act or the UK Modern Slavery Act.

Risks of Slavery and Human Trafficking in Supply Chain

Due to the nature of our workforce and the locations of most of our employees, we believe that the risks of modern slavery in our own business are remote. While there are risks inherent with third-party manufacturing, we have established the compliance and other procedures discussed herein to mitigate the risks of modern slavery in our product supply chains. Our approach is to focus on our direct (tier 1) suppliers, since this is the level of the supply chain where we believe that we have the most influence and can therefore be the most effective.

Commitment to Ethics; Codes of Conduct

We are committed to principles of ethical business practice and recognition of the dignity of others, including responsible labor practices.

Supplier Code

We also have a Code of Conduct that is applicable to all of the Company’s suppliers (including our third-party manufacturing contractors and product licensees) (the “Supplier Code”). The Supplier Code expressly prohibits the use of any form of slave, forced, bonded, indentured, or prison labor in any stage of the manufacture of our products. All work must be voluntary and workers must be free to terminate their employment at any time, without penalty. Involuntary labor includes the transportation, harboring, recruitment, transfer, receipt, or employment of persons by means of threat, force, coercion, abduction, fraud, or payments to any person having control over another person for the purpose of exploitation.

The Supplier Code provides that suppliers must ensure that no fees or costs have been charged, directly or indirectly, in whole or in part, to job-seekers and workers for their services directly related to recruitment for temporary or permanent job placement, including when using the services of private recruiters, labor brokers or employment agents or performing recruitment activities directly. Workers must not be required to pay employers’ or their agents’ recruitment fees or other similar fees to obtain their employment (such as host country fees like levies, fees for work permits, or fees for renewing work documents, or home country fees like visa fees, medical checks, or any other costs that are not the legal responsibility of the worker). We require that our suppliers must repay these fees to the worker if found to have been paid by workers. Our suppliers must also ensure that the third-party recruitment agencies (including labor brokers) they use are compliant with the provisions of the Supplier Code and applicable law, and must provide us with a list of the recruitment agencies they are using and the amount of fees being paid to such agencies.

Workers must receive a written contract in a language understood by the workers stating in a truthful, clear manner their rights and responsibilities in connection with their employment. Our suppliers may not retain any documents or demand monetary deposits or other collateral as a condition of employment. Workers must not be subject to the withholding of wages, original identification cards, original passports or other original travel documents or personal belongings. In addition, the Supplier Code provides that our suppliers must comply with all laws regulating local wages, work hours and benefits.

Pursuant to our factory social compliance program, all of the Company’s suppliers are required to certify compliance with the Supplier Code in writing. We also generally require that the terms of any contracts with our suppliers also include an undertaking to comply with our Supplier Code. In the event of a violation of the Supplier Code, we reserve the right to either terminate our relationship with the supplier or to work with the supplier to implement corrective action to remedy the non-conformance.

We expect our suppliers for recently acquired brands to be in compliance with our factory social compliance program within one year from the date of acquisition. In cases where full compliance by this date is challenging for one or more business partners of a recently acquired company, we will nonetheless continue to work with business partners that are honest, transparent and committed to making continuous improvements towards compliance.

Verification of Product Supply Chains to Address and Evaluate Risks of Modern Slavery

As part of our risk assessment, we conduct preliminary inspections of each new manufacturing facility and require detailed questionnaires from potential manufacturers. When assessing the risks of modern slavery at a manufacturing facility, we also consider that facility’s geographic location and the nature of the manufacturing activities for us, including the anticipated production volume. As previously stated, we expect our recently acquired brands to be in compliance with our factory social compliance program, including the risk assessment and audit process (discussed below), within one year from the date of acquisition.

Audits

We have an audit program under which audits of manufacturing contractors are conducted by an independent third-party auditor. Third-party manufacturing contractors are selected for audits each year based on the risk assessment described above and the results of prior audits. Manufacturing contractors are subject to announced audits at least every three years and unannounced audits as the circumstances warrant.

As part of the audit, the independent third-party auditor evaluates, among other things, a manufacturing contractor’s compliance with wage, hour and labor laws and health, safety and environmental regulations, as well as the working and other conditions within the facility. During the audit, the independent third-party auditor will visit and inspect the site, conduct interviews with supervisors, managers and workers at the facility (without supervisors and managers present), and review relevant books and records of the third-party manufacturer. The audit also covers a review of records of all migrant workers at the facility, including, date of arrival, contract terms (including copies of employment agreements), employment history, anticipated and actual date of return, and recruitment fees paid for the last three years or such longer time period as may be required by law (together with copies of all recruitment agency or labor broker agreements). If fees are required to be reimbursed by the supplier pursuant to the Supplier Code, we will disclose in future disclosures our efforts to ensure that workers were reimbursed for the fees in accordance with the Supplier Code.

followed by validation by the Company or its auditor that the deficiency has been remedied, including, if necessary through a re-audit of the manufacturing facility. In the case of a serious violation of the Supplier Code, termination of the Company’s relationship with the manufacturer may occur, particularly where corrective action is either not possible or determined to be an insufficient remedy.

Internal Accountability and Training

All employees are required to undergo compliance and ethics training, including with respect to the Employee Code, upon hire, and on a bi-annual basis thereafter. In addition, the Company’s directors and officers are required to complete an annual certification attesting that they know and understand the requirements of the Employee Code.

Employees are encouraged to raise any concerns and have multiple channels to do so, including through an ethics hotline staffed by independent third-party operators. The Company’s ethics hotline is also made available for external stakeholders. Contact information for the ethics hotline is available within the Code of Business Conduct and Ethics.

The Company also requires all employees and management who have direct responsibility for supply chain management to take a course directed at raising awareness regarding the risks of human trafficking and slavery in supply chains, identifying potential risks and addressing those risks when human trafficking and slavery may be suspected.

We have internal accountability standards and procedures for employees and suppliers that fail to comply with our policies relating to modern slavery. Violations of the Employee Code can result in dismissal of the employee and, as earlier noted, violations of the Supplier Code can result in termination of our relationship with the supplier.

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