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SKIMS began sourcing from the mentioned factory in June 2021 but subsequently ceased operations on April 23, 2022, after being made aware of allegations of the factory forcing employees to work overtime without pay. During our engagement with our supplier, Delta Galil USA, our sourcing team became aware of allegations concerning unpaid overtime to workers. This issue arose during the period when Delta acquired Bogart Companies in 2020. It is important to note that the exit of SKIMS from the factory did not result in the retrenchment of workers. This stability was achieved through Bogart Myanmar's swift response to fill the gap.

Furthermore, Delta and Bogart Myanmar took action by participating in the MADE in Myanmar project and initiated several projects, including:

• Implementation of improved and additional bonuses.
• Provision of 10 Kg. of rice per worker monthly and subsidies for coffee and tea.
• Establishment of a dedicated room for milk feeding for mothers.
• Expansion of the company clinic, with a doctor and nurse on-site permanently.

In addition to these measures, a Delta Corporate Compliance Manager has been appointed to oversee compliance in Bogart factories. We have engaged the services of Elevate to conduct third-party internal compliance audits, with Delta actively collaborating on remediation efforts based on audit findings.

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