Compliance reporting

Compliance Reporting Policy

This Compliance Reporting Policy (this "Policy") is binding upon all employees, officers, or directors of Ikänik Farms, Inc. (the "Company") or any of its subsidiaries. Consult with the Company's General Counsel if you have any questions about this Policy.

Policy Overview

The purpose of this Policy is to reinforce the business integrity of the Company by providing a safe and reliable means for employees and others to report concerns they may have about conduct at Ikänik Farms, Inc. By following this Policy, you can raise concerns, confidentially and anonymously if desired, and free of any retaliation, discrimination, or harassment.

Whether you are an employee, an officer or director, or someone who does business with us, we ask that you bring to light good faith concerns regarding Ikanik Farms, Inc. 's business practices.

We ask that you follow this Policy to report good faith concerns regarding any of the following:

·       Suspected violations of our Code of Ethics and Business Conduct, which we refer to in this policy as "Ethics Violations."

·       Suspected violations of any other Company policies or procedures, which we refer to in this policy as "Corporate Policy Violations."

·       Questionable accounting, violations of internal accounting controls, or any other auditing or financial matters, or the reporting of fraudulent financial information, which we refer to in this policy as "Fraudulent Auditing and Accounting Activities."

·       Suspected violations of law or fraudulent activities other than Fraudulent Auditing and Accounting Activities, which we refer to in this policy as "Legal Violations," and collectively with Ethics Violations and Corporate Policy Violations as "Violations."

If requested, we also ask that you provide truthful information in connection with an inquiry or investigation by a court, an agency, law enforcement, or any other governmental body.

Who Does This Policy Cover?

This policy applies to all employees, officers, and directors of Ikänik Farms, Inc.  or any of its subsidiaries, all of whom are referred to collectively as "employees" or "you" throughout this policy. In this policy, “we,” and “our” refers to Ikänik Farms, Inc. and its subsidiaries.

As an Ikänik Farms, Inc. employee, if you are aware of a potential Violation or Fraudulent Auditing and Accounting Activity and do not report it according to this policy, your inaction may be considered a Violation itself, which may result in disciplinary action, up to and including termination of your employment or any other relationship that you may have with Ikänik Farms, Inc. .

Reporting and Investigation

If you believe that any Violation or Fraudulent Auditing and Accounting Activity has occurred or is occurring or you have a good faith concern regarding conduct that you reasonably believe may be a Violation or Fraudulent Auditing and Accounting Activity, we encourage you to promptly take one or more of the following actions:

·       Discuss the situation with your manager.

·       If you are uncomfortable speaking with your manager or believe your manager has not properly handled your concern or is involved in the Violation or Fraudulent Auditing and Accounting Activity, contact the General Counsel.

·       If you do not believe your concern is being adequately addressed, or you are not comfortable speaking with one of the above-noted contacts, report your concern using one of the methods listed below, through which you may choose to identify yourself or remain anonymous:

·       by email to rkocot@ikanikfarms.com; or

·       via our ethics or reporting hotline by phone at 916-572-6445 or online on Ikänik Farms, Inc.’s intranet.

This Policy provides a mechanism for Ikänik Farms, Inc.  to be made aware of any alleged wrongdoings and address them as soon as possible. However, nothing in this Policy is intended to prevent any employee from reporting information to federal or state law enforcement agencies when an employee has reasonable cause to believe that the violation of a federal or state statute has occurred. A report to law enforcement, regulatory, or administrative agencies may be made instead of, or in addition to, a report directly to Ikänik Farms, Inc.  through the ethics or reporting hotline or any other reporting method specified in this Policy.

Receipt of the report will be acknowledged to the sender within a reasonable period following receipt if the sender supplied an address for response.

All reports of a Violation or Fraudulent Auditing and Accounting Activity will be taken seriously and will be promptly and thoroughly investigated. The specific action taken in any particular case depends on the nature and gravity of the conduct or circumstances reported and the results of the investigation. 

If a Violation or Fraudulent Auditing and Accounting Activity has been reported, investigated, and confirmed, the Company will take corrective action proportionate to the seriousness of the offense. This action may include disciplinary action against the accused party, up to and including termination of employment or any other working relationship that the offending party may have with Ikänik Farms, Inc. Reasonable and necessary steps will also be taken to prevent any further Violation or Fraudulent Auditing and Accounting Activity.

However, a party who knowingly and intentionally files a false report or provides false or deliberatively misleading information in connection with an investigation of a report may face disciplinary action, up to and including termination of employment or other legal proceedings.

Handling Reports

Reports of Violations, Fraudulent Auditing and Accounting Activity, or other questionable conduct that are submitted by any means specified in this Policy will be handled as follows:

All reports received relating to accounting and auditing, including Fraudulent Auditing and Accounting Activity, will be entered on an accounting and auditing matters log, which will include, among other things: (1) the date the report was received, (2) a description of the report, (3) the reporting party (if provided), and (4) the status and disposition of an investigation of the report. 

The General Counsel will promptly report to the relevant committee: (1) reports of Ethics Violations or Fraudulent Auditing and Accounting Activity, including any such reports that are received by the General Counsel but were not initially directed to the relevant committee, (2) any Violation or Fraudulent Auditing and Accounting Activity involving the Company's executive officers or directors, and (3) such other matters as the General Counsel deems significant. The relevant committee shall direct and oversee an investigation of such reports, as well as any reports initially directed to the relevant committee, as it determines to be appropriate. The relevant committee may also delegate the oversight and investigation of such reports to management, including the General Counsel or outside advisors, as appropriate.

All other reports regarding accounting or auditing matters shall be reviewed under the direction and oversight of the General Counsel, who will involve such other parties as deemed appropriate.

The General Counsel shall provide the relevant committee with a quarterly report of all accounting or auditing reports received and an update of pending investigations. The Audit Committee may request special treatment for any report and may assume the direction and oversight of an investigation of any such report.

All other reports will be logged separately and shall be reviewed under the direction and oversight of the General Counsel, who will forward them to the appropriate person or department for investigation (for example, labor and employment matters will be forwarded to the Human Resources Department), unless the General Counsel determines that other treatment is necessary.

Confidentiality

Information disclosed during the course of the investigation will, to the extent practical and appropriate, remain confidential in compliance with the Company's Code of Ethics and Business Conduct, except as may be reasonably necessary under the circumstances to facilitate the investigation, take remedial action, or comply with applicable law.

For any Violation or Fraudulent Auditing and Accounting Activity not reported through an anonymous report, we will advise the reporting party that the Violation or Fraudulent Auditing and Accounting Activity has been addressed and, if we can, of the specific resolution. However, due to confidentiality obligations, there may be times when we cannot provide the details regarding the corrective or disciplinary action that was taken.

Nothing in this Policy in any way prohibits or is intended to restrict or impede employees from discussing the terms and conditions of their employment with co-workers or union representatives or sexercising protected rights to the extent that such rights cannot be waived by agreement, or otherwise disclosing information as permitted by law.

No Retaliation

Ikänik Farms, Inc.  strictly prohibits and does not tolerate unlawful retaliation against any employee, or officer for reporting a Violation or Fraudulent Auditing and Accounting Activity or suspected Violation or Fraudulent Auditing and Accounting Activity in good faith or otherwise cooperating in an investigation of a Violation or Fraudulent Auditing and Accounting Activity. All forms of unlawful retaliation are prohibited, including any form of adverse action, discipline, threats, intimidation, or other form of retaliation for reporting under or complying with this Policy. Ikänik Farms, Inc.  considers retaliation a Violation itself, which will result in disciplinary action, up to and including termination of employment or any other working relationship with Ikänik Farms, Inc.   

If you have been subject to any conduct that you believe constitutes retaliation for having made a report in compliance with this Policy or for having participated in any investigation relating to an alleged Violation or Fraudulent Auditing and Accounting Activity, please immediately report the alleged retaliation to the General Counsel, ideally within ten (10) days of the offending conduct. If, for any reason, you do not feel comfortable discussing the alleged retaliation with these people, please report the alleged retaliation through the ethics or reporting hotline by phone at online using the Ikänik Farms, Inc.’s intranet. These individuals will ensure that an investigation is conducted in a timely fashion.

Your complaint should be as detailed as possible, including the names of all individuals involved and any witnesses. Ikänik Farms, Inc.  will directly and thoroughly investigate the facts and circumstances of all perceived retaliation and will take prompt corrective action, if appropriate.

Additionally, any manager or supervisor who observes retaliatory conduct must report the conduct to the General Counselso that an investigation can be made and corrective action taken, if appropriate.

Bringing any alleged retaliation to our attention promptly enables us to honor our values, and to promptly and appropriately investigate the reported retaliation in accordance with the procedures outlined above.

Any employee, regardless of position or title, who has been determined to have engaged in retaliation in violation of this Policy, will be subject to appropriate disciplinary action, up to and including termination of employment or any other working relationship with Ikänik Farms, Inc.

Modification

The Company expressly reserves the right to change, modify, or delete the provisions of this Policy without notice.

Effective Date

·       This Policy is effective as of April 5, 2021

CODE OF CONDUCT

Ikänik Farms, Inc. Code of Business Conduct and Ethics

1.              Introduction.

1.1                  The Board of Directors of Ikänik Farms, Inc. (together with its subsidiaries, the "Company") has adopted this Code of Business Conduct and Ethics (the "Code") to:

(a)           promote integrity and honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest;

(b)           promote full, fair, accurate, timely and understandable disclosure in reports and documents that the Company files with, or submits to securities regulators and in other public communications made by the Company;

(c)           promote compliance with applicable governmental laws, rules and regulations;

(d)           promote the protection of Company assets, including corporate opportunities and confidential information;

(e)           promote fair dealing practices;

(f)            deter wrongdoing; and

(g)           ensure accountability for adherence to the Code.

The Company's policy is to promote high standards of integrity by conducting its affairs honestly and ethically. The purpose of the Code is to guide directors, officers and employees on how to carry out their duties in an honest and ethical manner. 

Each director, officer and employee must act with integrity and observe the highest ethical standards of business conduct in his or her dealings with the Company's security holders, customers, suppliers, partners, service providers, competitors, employees and anyone else with whom he or she has contact in the course of performing his or her job. While the Code does not, and cannot, deal with every situation that may arise, the principles outlined in the Code should be seen as providing a baseline for honest and ethical decision-making. The Company shall ensure that each director, officer and employee is provided with a copy of the Code and signs an acknowledgment of receipt and review.

1.2                  All directors, officers and employees are required to be familiar with the Code, comply with its provisions and report any suspected violations as described below in Section 10.

2.              Conflicts of Interest.

2.1                  Conflicts of interest should be avoided unless specifically authorized. A conflict of interest occurs when an individual's private interest (or the interest of a member of his or her family) interferes, or appears to interfere, with the interests of the Company as a whole. A conflict of interest can arise when an employee, officer or director (or a member of his or her family):

(a)           takes actions or has interests that may make it difficult to perform his or her work for the Company objectively and effectively;

(b)           receives improper personal benefits because of his or her position in the Company; or

(c)           has a material interest in an agreement or transaction involving the Company.

2.2                  Whether or not a conflict of interest exists or will exist can be unclear. Conflicts of interest should be avoided unless specifically authorized as described in Section 2.4.

2.3                  Persons other than directors and executive officers who have questions about a potential conflict of interest or who become aware of an actual or potential conflict should discuss the matter with, and seek a determination and prior authorization or approval from, their supervisor. A supervisor may not authorize or approve conflict of interest matters or make determinations as to whether a problematic conflict of interest exists without first providing a written description of the activity and seeking a designated corporate officer’s written approval. If the supervisor is involved in the potential or actual conflict, the matter should instead be discussed directly with the designated corporate officer.

3.              Compliance.

3.1                  The Company and its employees, officers and directors should comply, both in letter and spirit, with all applicable laws, rules and regulations in the jurisdictions in which the Company operates.

3.2                  Although not all employees, officers and directors are expected to know the details of all applicable laws, rules and regulations, it is important to know enough to determine when to seek advice from appropriate personnel. Questions about compliance should be addressed to General Counsel.

3.3                  No director, officer or employee may purchase or sell any Company securities while in possession of material non-public information regarding the Company, nor may any director, officer or employee purchase or sell another company's securities while in possession of material non-public information regarding that company. It is against Company policies and illegal for any director, officer or employee to use material non-public information regarding the Company or any other company to:

(a)           obtain profit for himself or herself; or

(b)           directly or indirectly "tip" others who might make an investment decision on the basis of that information.

4.              Disclosure.

4.1                  The Company's periodic reports and other public documents, including all financial statements and other financial information, must comply with applicable securities laws and stock exchange rules.

4.2                  Each director, officer and employee who contributes in any way to the preparation or verification of the Company's financial statements and other financial information must ensure that the Company's books, records and accounts are accurately maintained. Each director, officer and employee must cooperate fully with the Company's accounting and internal audit departments, as well as the Company's independent public accountants and counsel.

4.3                  Each director, officer and employee who is involved in the Company's disclosure process must:

(a)           be familiar with and comply with the Company's disclosure controls and procedures and its internal control over financial reporting; and

(b)           take all necessary steps to ensure that all filings with the securities regulators and all other public communications about the financial and business condition of the Company provide full, fair, accurate, timely and understandable disclosure.

5.              Protection and Proper Use of Company Assets.

5.1                  All directors, officers and employees should protect the Company's assets and ensure their efficient use. Theft, carelessness and waste have a direct impact on the Company's profitability and are prohibited.

5.2                  All Company assets should be used only for legitimate business purposes, though incidental personal use may be permitted. Any suspected incident of fraud or theft should be reported for investigation immediately.

5.3                  The obligation to protect Company assets includes the Company's proprietary information. Proprietary information includes intellectual property such as trade secrets, patents, trademarks, and copyrights, as well as business and marketing plans, engineering and manufacturing ideas, designs, databases, records and any non-public financial data or reports. Unauthorized use or distribution of this information is prohibited and could also be illegal and result in civil or criminal penalties.

5.4                  All transactions undertaken on behalf of the Company must be authorized in accordance with Company policies and must be documented accurately. Directors, officers and employees responsible for record-keeping and accounting must ensure that the Company’s books and records are accurate, timely and fair in their description of the assets of the Company.

6.              Corporate Opportunities. All directors, officers and employees owe a duty to the Company to advance its interests when the opportunity arises. Directors, officers and employees are prohibited from taking for themselves personally (or for the benefit of friends or family members) opportunities that are discovered through the use of Company assets, property, information or position. Directors, officers and employees may not use Company assets, property, information or position for personal gain (including gain of friends or family members). In addition, no director, officer or employee may compete with the Company.

7.              Confidentiality. Directors, officers and employees should maintain the confidentiality of information entrusted to them by the Company or by its customers, suppliers or partners, except when disclosure is expressly authorized or legally required. Confidential information includes all non-public information (regardless of its source) that might be of use to the Company's competitors or harmful to the Company or its customers, suppliers or partners if disclosed. The obligation to maintain the confidentiality of information remains even after the director, officer or employee ceases to be employed or hold office with the Company.

8.              Fair Dealing. Each director, officer and employee must deal fairly with the Company's security holders, customers, suppliers, competitors, employees and anyone else with whom he or she has contact in the course of performing his or her job. No director, officer or employee may take unfair advantage of anyone through manipulation, concealment, abuse or privileged information, misrepresentation of facts or any other unfair dealing practice.

9.              Human Rights in the Workplace. The Company is committed to providing a workplace free of harassment, violence and discrimination. Directors, officers and employees are expected to foster a respectful work environment that adheres to the requirements of applicable human rights law and related workplace legislation. The Company will not tolerate acts of discrimination based on age, ancestry, color, race, citizenship, ethnic origin, creed, disability, family status, marital status, gender, sex, sexual orientation or any other ground of discrimination prohibited by law.

10.           Reporting and Enforcement.

10.1               Reporting and Investigation of Violations.

(a)           Actions prohibited by this code involving directors or executive officers must be reported to the relevant committee.

(b)           Actions prohibited by this code involving any other person must be reported to the Director of Compliance.

(c)           After receiving a report of an alleged prohibited action, the General Counselmust promptly take all appropriate actions necessary to investigate.

(d)           All directors, officers and employees are expected to cooperate in any internal investigation of misconduct.

10.2               Enforcement.

(a)           The Company must ensure prompt and consistent action against violations of this Code.

(b)           If, after investigating a report of an alleged prohibited action by a director or executive officer, the relevant committee determines that a violation of this Code has occurred, the relevant committee will report such determination to the Board of Directors.

(c)           If, after investigating a report of an alleged prohibited action by any other person, General Counsel determines that a violation of this Code has occurred will report such determination to the General Counsel.

(d)           Upon receipt of a determination that there has been a violation of this Code, the Board of Directors or the General Counsel will take such preventative or disciplinary action as it deems appropriate, including, but not limited to, reassignment, demotion, dismissal and, in the event of criminal conduct or other serious violations of the law, notification of appropriate governmental authorities.

10.3              Waivers and Disclosure.

(a)           Each of the Board of Directors (in the case of a violation by a director or executive officer) and the General Counsel (in the case of a violation by any other person) may, in its discretion, waive any violation of this Code.

(b)           Any waiver of this Code for or violation of this Code by a director or an executive officer shall be disclosed as required by securities laws.

10.4              Prohibition on Retaliation. The Company does not tolerate acts of retaliation, including demotion, discharge, discipline, discrimination, harassment, suspension or threats, against any director, officer or employee who makes a good faith report of known or suspected acts of misconduct or other violations of this Code.

11.           Amendment. The Board of Directors may, from time to time, amend the Code.

Administration of This Code

The General Counsel is responsible for the administration of this Code of Business Conduct and Ethics. If employees, directors or officers have any questions about the Code generally or any questions about reporting a suspected conflict of interest or other violation of the Code, they may contact General Counsel.

Ikanik Farms, Inc. expressly reserves the right to change, modify or delete portions of this Code without notice.

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