Compliance Training 101

[Virtual Presenter] Texas Original Compassionate Cultivation New Hire Compliance Training 062023.

[Audio] Table of Contents. Logo Description automatically generated.

[Audio] Texas Compassionate Use Program known as CUP or TCUP was enacted in 2015 by Texas Legislature. Partnership with the DPS to ensure compliance of CUP program rules and quality medicine for the patients of Texas. DPS administers the CUP Program under the authority of the TX Health and Safety Code 487. DPS manages the licensing of the program as well. Regulations consist of many guidelines or regulations from the State of Texas and also references Texas Department of Ag codes, Federal fire, building, and safety codes. To remain in compliance we must adhere to the rules and regulations of the State and Federal governments..

[Audio] Texas CUP Program is one of the most restrictive programs in the US. Because we are still a "Low THC Medical Industry" many cannabis data warehouses do not collect information on Texas; the 1% THC cap keeps us 'almost' hemp.. In 2015 TX Legislature enacted low THC/high CBD for children with epilepsy and other "incurable neurodegenerative diseases", since then the program has broadened to include more medical conditions and a small increase in the THC cap. 1. low THC 1% by weight max – which was increased in 2021 from 0.5% to 1.0% 2. Non combustible –No Fire/No inhalation 3. Texas has no "dispensaries", they are Pick up locations due to the regulations, TX does not allow us to store inventory except for at our cultivation facility in Austin. 4. Vertically integrated industry in Texas; Grow, Process, Deliver, Sell.

[Audio] Texas Original Compassionate Cultivation was the fifth in Texas to secure a MMJ license. We are the Original. There are currently only 3 companies legally licensed to grow, process, & distribute Medical Marijuana in Texas. Texas Original is the only one that is born and bred in Texas; the other 2 are multi state operators..

[Audio] Cannabis Compliance is adhering to Texas & Federal laws & regulations surrounding cannabis. Not achieving compliance can mean fines, suspension, or total loss of license, depending on what regulations are broken..

[Audio] Operational compliance in the cannabis industry is layered with hundreds, if not thousands of rules, regulations, statutes, and codes to sort through. From international fire and building codes to guidelines from OSHA, the FDA, and EPA, to state and local cannabis-specific industry regulations Each one having their own legal language that must be defined and understood. We will go over areas of compliance that you should be familiar with as well as what your responsibilities are to assist in maintaining full compliance..

[Audio] A few regulatory agencies that you will hear about or need to be familiar with: DPS they govern the regulations set forth by the State of Texas- they are the number one regulatory body that you will see the most – please become familiar with their rules – There are many rules that we must adhere to, if you have a question on rules are regulations please don't hesitate to ask your leadership team or Compliance for clarity. OSHA governs the safety for workers – HIPAA governs the Privacy of the patients; Hard copies, electronic copies, and verbally. A simple conversation with a friend that you are discussing work with may become a violation to HIPAA policy. Please be mindful of what you are discussing when it pertains to work and who you are speaking with. Patient privacy is a law we are required to abide by. EPA – Haz Waste & Handling; in addition to Federal EPA, we have TX DOT & TCEQ that also regulates the hazardous waste and rules around that. Dept of Ag – Pesticide Usage, Storage, & Handling The TCUP rules and regulations combines the regulatory bodies mentioned plus a few more that you may discuss in more detail when you get to your department. A lot of these regulations or rules you will see again in some of our Standard Operating Procedures. A fine from any of these governing bodies will be quite substantial and it will keep them coming back...Something we do not want..

[Audio] Cannabis Related OSHA Violations & Fines – To demonstrate the sky high fines mentioned previously. Many of these types of infractions are often found during compliance inspections at marijuana businesses. EPA is very similar in their fines. They stack up very fast! It is all of our responsibility to keep an open eye for potential violations..

[Audio] Prior to attending this training, team has already been introduced to some compliance required in the Texas market. Fingerprints to have your background checked. Company Handbook – addresses Company rules and expectations –You were required to read and sign. By signing, you are stating you have read the rules or requirements, you understand them and you agree to adhere to them. Dress Code – will vary by department – Present yourself as a professional adult – we are running a business and we have patients in the front on a daily basis. Handbook has a few interesting dress code (hair, tattoo) statements; please read if you haven't or refresh your memory and read again. Drug Free Workplace-all required to read and sign No consumption on property or during working hours Security/Safety-Security and Safety Plan incase of Emergency Cameras are required by CUP program to be placed in and around the facility to prevent diversion. They are monitored and are frequently repositioned to ensure we are viewing all areas that team members are working in and around. YOU ARE BEING WATCHED! HIPAA- Protecting the patients privacy – Required training and sign off; Dispo, Transportation, CEx Teams IT- Phishing emails Social Media-Handbook - what to do and not to do-Know the company policies on Social.

[Audio] Prior to employment with TOCC you were required to submit your fingerprints to the DPS. You would not have this position if your background check wasn't clean. Requirements for all: CUP Card present and visible at all times. If you lose or forget your CUP Card please contact your manager and Compliance immediately. All visitors must be signed in through the front office. No visitors are allowed without prior consent from your leadership. When visitors are on campus, they must be signed in, wearing a visitors badge, and NEVER left unaccompanied... No wandering contractors or visitors! 2. Access Badge & Keys –You will be given an access badge that is programmed by your position. Please do not swipe others in or out of areas with your badge and do not go into rooms or access points that you don't have access to. Same with keys, we do not share keys, we do not have extra keys made without prior approval from your direct leadership. Once you receive the keys, your name is logged and via the cameras monitored per access point. 3. Alarm Code – do not share or loan; if something happens and it is your code, you will be responsible not who you loaned it to 4. Log ins/Passwords - If you do not have access to a particular software that you need please request via the IT ticket system - 5. Company Information – some employees will be privy to new products or processes coming down the pike; financial information, patient or doctor information, etc. We do not discuss any company business in a public forum or social setting (including social media)..

[Audio] This is for all departments: One of the big ones for the Regulators We are required to be proactive and implement diversion prevention and not reactive and have to report diversion. Some of the systems we have in place to prevent diversion are: SOPS Organized and labeled inventory - Labeled products – everything must be labeled legibly per DPS medicated and non medicated products if you are not sure if it needs a label, label it. Inventory system and adjustments to inventory – track and trace/seed to sale SAGE Locks – Vault doors, access points, cages, doors, keys, Green Waste dumpsters Weights of products – in Sage and on products Cameras Seed to Sale – we are required to account down to the gram for every plant, product, seed, clone, unit.

[Audio] Monthly Safety Meetings PPE - Equipment Maintenance Logs SDS Sheets – know where they are and how to read them Pictograms – know how to interpret Container Labeling – know how to interpret We will be having additional presentation on Safety in the near future..

[Audio] There is a right and a wrong way to wear PPE. Please ask your leadership or peers if you are unsure how something is to fit. No Open Toed Shoes – Common in manufacturing environment Scrubs or Lab Coat – Clean uniform, prevents cross contamination Hair Net – Cross contamination Beard Net – Cross contamination Ear Plugs – Loud noises your protection Face Mask – Prevent you from breathing dust or particles in and prevents cross contamination; saliva, breath – Trulieve – employee died from kief dust - lawsuit Gloves –Cross contamination – Wash or change the gloves often! Computer keyboards, phones, door handles Long Sleeve –Cannabis allergies/terpenes/kief Long Pants – Cannabis allergies/kief Respirator – Protect your lungs – fit per person – not a universal fit Foot Booties – Cross contamination Tyvek Suits – Protect your skin or person We will be having an additional presentation on just PPE in the near future. Massachusetts, Trulieve lawsuit & OSHA violations & fine for failing to conduct a hazard analysis which ultimately led to death of an employee. Employee was in trim room and due to the kief or dust in the air and employee not wearing the proper PPE, facemask or respirator the employee died..

You'll be fine...Until you're not! Safety & Security protocols are in place to keep you and your team safe..

[Audio] Compliance For All - This list is not all-inclusive. All company records are required to be available for 2 years per CUP 12.4 Documenting allows us to train & communicate the team- it also allows us to see any gaps in the process, creating an opportunity to fine tune processes if needed. If any challenge or issue comes up, DPS will request a current SOP and request improvements to the process. DPS currently has a copy of all Standard Operating Procedures we have. We are required to submit to them when changes/updates are made. By regulations we are required to keep at least 2 years of all documentation for review request from the DPS. This will include SOPs, training logs, equipment logs, extraction logs, Patient return logs, Patient prescription information, Employment records, among many others! Please ensure you files are organized and can quickly be retrieved and submitted if requested. Good recordkeeping keeps us organized and shows the regulators we are following regulations and in full compliance. I would suggest you utilize the SharePoint to house all files in an orderly manner for quick reference. Processes or SOPS Training Records Licensing applications Pesticide application log Surveillance Testing Transfers Transactions.

[Audio] Compliance For ALL We are producing a medicine, our facility and products are medical grade Sanitation protocols set in place Proper PPE to prevent cross contamination Sanitation – All work surfaces cleaned before and after a shift Pest management system Clean – Cleaning Logs daily, weekly, monthly Equipment working properly – Equipment Maintenance Log Equipment Cleaning Log Proper dress code for your department Your department may have additional sanitation protocols to ensure we aren't bringing in pest or pathogens..

[Audio] Compliance For All - We are responsible for what goes in our dumpsters, the way we put it in there, who picks it up, and if someone retrieves it! Texas we are allowed to compost our green waste. We must select waste companies that 1. can remove the waste 2. will remove the waste 3. Depending on the waste material the waste company will need to have a special license or certificate for instance, Haz Waste. All waste our operation facility produces we must determine if it is hazardous or not and dispose of it accordingly. Contingency Plan for all Haz Waste is required by EPA.

[Audio] There are additional Compliance Requirements per Department – We will discuss a few in the next slides. Please note these may not be all of the additional compliance points for your department. Your department lead will go over other tasks, compliance areas, during your onboarding..

[Audio] Training will be provided by your department head on SDS Sheets, Hazard Classifications, Labels, Responsibilities or Required Actions after certain tasks; i.e. Spraying the plants – after we document in the Pesticide Spray Log, Re-entry signage to be placed outside the door with a date and time when reentry is safe. Odor control for the plant is required as well.

[Audio] Safety additions: COAs for all ingredients kept on file—More Documentation SOPs, Training, Best Practices, Cross Contamination Prevention Manufacturing can contain several biological, chemical, & physical hazards- Following company best practices & safety program can eliminate potential hazards..

[Audio] PPE, inventory, labels, clean, testing, sops, training, best practices Vermont, lawsuit for non approved pesticide in the product- product was recalled after causing headaches & nausea. Company didn't properly test all. Minnesota, lawsuit 3 manufacturers sued for violating regulations that limit the amount of THC a single product can have. Testing results were tampered or no testing was performed and logged..

[Audio] Diversion Prevention for Facilities team is not so much for the product but for our equipment, tools, etc..

[Audio] Diversion Prevention Inventory Labels Locks/Access Points Safety Proper Dress Code PPE SDS Sheets Warning Signs/Pictograms Training Labels on Containers Equipment Maintenance Logs.

[Audio] Lawsuit in California – patient filed a lawsuit against a dispo for failing to ensure their website is compliant with the Americans with Disabilities Act.

[Audio] Sanitation: When filling RX for patients, ensure your hands are clean or you wear gloves. Diversion Regularly occuring Inventory Audits Performed by 2 People.

Additional Compliance - Sales & Customer Experience.

[Audio] Best Practices are created by rules and regulations from governing bodies we are required to follow, company rules we are required to follow, and procedures to minimize risk of employees safety, patients health, product consistency, & quality. When following Best Practices the potential to decrease expenses, increase volume, and decrease the "bad" or "rework" product becomes more attainable. Sanitation & Hygiene Protocols –PPE Limit Contamination No Eating or Drinking in Production Rooms Equipment Cleaning & Maintenance Proper Storage of Product Recordkeeping & Documentation Quality & Testing Protocols Recall Procedures Packaging & Labeling Requirements Ongoing Safety Training Up to Date SOPs & Ongoing Training Labels – If you wonder if something should be labeled, DO IT. All items must be labeled for identification, don't assume the next person knows what an item is if it is not labeled properly. SDS sheets – Know where they are located and how to interpret them Container Labeling – Pictograms, Hazard Labels know how to interpret them.

Additional Training. A picture containing text plant Description automatically generated.

Logo Description automatically generated. Questions or Comments? Contact Compliance Diaya Clary Director of Compliance & Safety [email protected] 502 595 8794.