FIGHTING AGAINST FORCED LABOUR AND CHILD LABOUR IN SUPPLY CHAINS ACT JOINT ANNUAL REPORT FISCAL YEAR 2023

G2S TOBEQ INC. ORS CANADA INC.

And the controlling entities

BUTION HOLDCO 1, LLC BUTION HOLDCO 2, INC. BUTION HOLDCO 3, INC. ORS NASCO, LLC

O.K.I. SUPPLY, LLC

G2S ÉQUIPEMENT DE FABRICATION ET D'ENTRETIEN INC.

1.     Introduction

This report is prepared by Bution Holdco 1, LLC (“BH1”) jointly with Bution Holdco 2, Inc., Bution Holdco 3, Inc., ORS Nasco, LLC, OKI Supply, LLC, G2S équipment de fabrication et d'entretien inc., G2S Tobeq Inc. (“G2S”) ORS Canada Inc. (“ORS”) (G2S and ORS referred to collectively as the “Companies” and all of the reporting companies are referred to collectively as “we”, “us” or the “reporting entities”) in compliance with Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act (the “Act”) and covers the financial year ending December 31, 2023.

2.     Structure, Activities and Supply Chains

The Companies are wholesalers of automotive, safety and industrial supplies which they sell exclusively to distribution networks in Canada.

More specifically, G2S is a wholesale distributor of tools and equipment serving the automotive, heavy- duty, industrial, agricultural and marine industries. G2S is headquartered in Montreal, Quebec. G2S’ supply chain structure spans multiple categories, including front-end suspension tools, welding equipment, tire maintenance tools, and various specialized automotive service tools. The diverse product range requires a multi-sourced supply chain where components and tools are sourced from various manufacturers. G2S’ supply chain is structured to provide a comprehensive and reliable service to the automotive industry, supported by a robust online presence, multiple distribution centers, and partnerships with leading brands such as Milwaukee Electric, Bosch Automotive, and Autel Diagnostics.

ORS is a wholesaler of safety, industrial, welding and janitorial/sanitation products since 1979, and has its registered office in Mississauga, Ontario. ORS sources its products from such well-known manufacturers as 3M, Honeywell and Kimberly-Clark. ORS Canada's supply chain structure is designed to support efficient and effective distribution of their extensive product lines to authorized distributors across Canada. ORS Canada has two main warehouses located in Mississauga, Ontario, and Calgary, Alberta. These facilities enable the company to stock significant inventory and efficiently serve all regions across Canada. Each province is covered by district managers who facilitate operations and maintain local relationships with distributors.

BH1 is the ultimate parent and controlling entity of the Companies and provides the overall direction for the corporate group and aligns its strategic planning, operational efficiency, business conduct and corporate governance.

A critical aspect of the group’s corporate governance is its supply chain oversight which ensures that operations run efficiently, ethically and in line with the group’s strategic goals and values.

Maintaining strong relationships with suppliers is fundamental in our business. Not only do these relationships ensure a steady supply of quality products and components, which is essential for meeting customer expectations and maintaining competitive advantage, but it also ensures we have a better understanding of our partners and how they do business across our supply chain.

1.     Policies and Due Diligence Processes

While we have not yet adopted any formal supplier oversight processes or supply chain management policies, we have started to implement a structured approach that we hope can significantly improve overall supply chain risk assessment and management.

We have engaged legal counsel to draft policies, such a Code of Ethics and Supplier Code of Conduct that will serve as a foundation for continuous improvement efforts in our supply chain management. We intend

for these policies to establish clear guidelines and standards for ethical behavior and supplier conduct, the adherence to which will provide a more concrete framework for mitigating and averting potential risks or deviations from expected ethical and sustainable practices within our supply chain.

Our current due diligence process and supplier oversight consists of identifying our most critical suppliers, determining if they are located in regions with known labor risks and assessing the impact they have on our business. We perform basic research on suppliers by utilizing publicly available information, third-party reports and industry databases. When possible, we visit supplier facilities to understand their operations better and build stronger relationships.

Some of our most important suppliers are well-known public corporations who have stringent ethical and reporting standards. We have developed long-term relationships with suppliers who demonstrate a commitment to ethical labor practices and we prioritize these suppliers in our procurement process.

2.     Forced Labour and Child Labour Risks

While the wholesale of automotive, safety, and industrial supplies industries involve complex global supply chains that can pose significant risks of forced labour and child labour that arise at various stages of the supply chain, from raw material extraction to manufacturing and distribution, we are not aware of any specific instances occurring in our supply chain. The vulnerable areas of the industries in which we operate may generally involve the following:

• Raw Material extraction:
  • o   Many automotive and industrial supplies rely on raw materials such as metals and minerals. The extraction of these materials, especially in countries with weak regulatory frameworks, may involve forced labour and child labour, especially since they may occur in countries with inadequate labour standards and enforcement capabilities.
• Manufacturing and Production:
  • o   The manufacturing of automotive, safety and industrial supplies can take place in factories where, in some countries where labour regulations are weak or where enforcement is challenging, workers are subjected to excessive hours, low wages and unsafe working conditions. It also often involves multi-layered supply chains composed of many actors that make it difficult to monitor supply chain activities.
• Geographical Risks:
  • o   Supply chains in our industries sometimes extend into countries where weak labour laws, poor enforcement or corruption can pose more significant risks of forced labour and child labour.
• Supplier Practices:
  • o   The complexity and length of supply chains in these industries make it difficult to monitor activities and trace the origins of materials and the conditions under which products are made, thereby increasing the risk of potential labour violations.
• Limited Transparency:
  • o   Due to the complexity of our industry’s supply chains and its multiple layers of players involved, there is limited transparency. Moreover, labour standards and legislative and regulatory measures are not consistent across countries, making compliance that much more difficult to track.

We believe the implementation of more robust governance and oversight mechanisms can better manage and reduce the risks of forced labor and child labor within our supply chains and our objective is to move in this direction.

3.     Remediation Measures

Throughout the current reporting period, we have not identified, become aware of or received reports of specific instances involving forced labor or child labor within our supply chain. As a result, we have not undertaken any remediation measures concerning these issues during this time. Similarly, there have been no actions required to address potential income loss for vulnerable families that might arise from efforts to eliminate forced or child labor practices. That said, we remain vigilant and committed to ethical labor standards and continue to monitor and review our supply chain and practices to uphold these principles.

4.     Employee Training

We are still in the initial phases of establishing an ethical and sustainable supply chain framework and have not yet adopted formal employee training sessions with respect to forced and child labor. We are however committed to raising awareness and fostering ethical practices through employee empowerment and training and we try to ensure that employees are informed, remain vigilant and maintain regular and open dialogue both internally and with our supply and distribution partners.

The eventual adoption of a Code of Ethics and Supplier Code of Conduct referred to in section 3 above will serve as foundational elements for educating and empowering employees to combat forced labor and child labor effectively within our supply chain. These policies will paper and define the company's stance on forced labor and child labor and outline specific prohibitions and expectations regarding ethical conduct within the organization and throughout the supply chain. It will also raise awareness among employees, provide guidance on how to identify and address instances of forced labor and child labor within the supply chain and empower them to recognize red flags and take appropriate action when encountering potential violations. By integrating these policies into our training programs, we intend to formalize the culture of ethical conduct we already espouse and promote more responsible business practices throughout the organization.

5.     Effectiveness Assessment

Assessing the effectiveness of forced labor and child labor supply chain measures in the absence of a formal structure has proven to be a revelatory exercise that provides us with valuable insights that will certainly drive improvement over time. By reviewing our existing documentation and practices related to supply chain risks and management and soliciting feedback from employees, suppliers, and other stakeholders on ways to enhance the effectiveness of proposed measures we hope to ensure that forced labour and child labour practices are not taking place in our business and supply chains. This endeavour is a work in progress.

6.     Approval and Certification

This report, for the financial year ending December 31, 2023 has been reviewed and approved by a member of the Board of Directors for ORS Canada and G2S Tobeq on May 30, 2024, pursuant to paragraph 11 (4)(b)(ii) of the Act.

In accordance with the requirements of the Act, and in particular section 11 thereof, I attest that I have reviewed the information contained in the report for the entities listed above.