UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 8-K
 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported):   July 25, 2018
 
 
FREEDOM HOLDING CORP.
(Exact name of registrant as specified in its charter)
 
 
 
 
 
Nevada
 
001-33034
 
30-0233726
(State or other jurisdiction of incorporation)
 
Commission
File Number)
 
(IRS Employer
Identification No.)
 
 
 
 
 
77/7 Al Farabi Ave., “Essentai Tower” BC, Floor 3, Almaty, Kazakhstan
(Address of principal executive offices)
 
050040
(Zip code)
 
(801) 355-2227
(Registrant’s telephone number, including area code)
 
N/A
(Former name or former address, if changed since last report.)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2 below):
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company □
 
If an emerging growth company, indicated by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □
 

 
 
 
Item 5.05.  
Amendments to the Registrant’s Code of Ethics, or Waiver of a Provision of the Code of Ethics
 
On July 25, 2018, the board of directors (the “Board”) of Freedom Holding Corp. (the “Company”) adopted a new Code of Ethics and Business Conduct (the “Code”), which governs the conduct of all directors, officers and employees of the Company and its subsidiaries. The Company’s prior Code of Ethics was adopted a number of years ago. The Board believes the new Code is more robust and detailed and better reflects the Company’s current practices and the current standards in public company corporate governance.
 
The new Code provides enhanced descriptions of the types of situations that would or may involve a conflict of interest. It also provides more detailed guidelines with regard to determination of conflicts of interest, the process for pre-approval of such transactions and guidance on duties to directors, officers and employees within the context of corporate opportunities. The new Code expands the Company’s commitment to legal and disclosure compliance, and more fully addresses the protection and proper use of Company assets. The new Code imposes additional responsibilities upon directors, officers and employees with regard to preparation and verification of the Company books, records and accounts. The new Code implements more detailed standards for reporting and enforcement of violations of the new Code, procedures for obtaining waivers of Code violations and a prohibition against retaliation against parites who make good faith reports of known or suspected acts of misconduct or other violations. The new Code also encourages employees to discuss observed violations with their supervisors and the Company’s President, or when one is appointed, the Company’s Chief Compliance Officer.
 
The foregoing summary of the changes between the Company’s prior Code of Ethics and the new Code is qualified in all respects by the full text of the new Code, which is filed herewith as Exhibit 14.1.
 
Item 9.01     
Financial Statements and Exhibits
 
Exhibit No.
 
Exhibit Name
 
Freedom Holding Corp Code of Ethics and Business Conduct
 
 
 
 
 
 
SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
  FREEDOM HOLDING CORP.
 
 
 
 
Date: July 27, 2018
By:
  /s/ Evgeniy Ler
 
 
Evgeniy Ler
 
 
Chief Financial Officer
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Exhibit 14.01
 
Freedom Holding Corp. Code of Ethics and Business Conduct
 
1.   Introduction .
 
    1.1   The Board of Directors of Freedom Holding Corp. (together with its subsidiaries, the “ Company ”) has adopted this Code of Ethics and Business Conduct (the “ Code ”) in order to:
 
(a)  promote 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, the Securities and Exchange Commission (the “ SEC ”) 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.
 
    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, Reporting and Enforcement.
 
2.   Honest and Ethical Conduct .
 
    2.1  The Company’s policy is to promote high standards of integrity by conducting its affairs honestly and ethically.
 
 
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    2.2  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 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.
 
3.   Conflicts of Interest .
 
    3.1  A conflict of interest occurs when an individual’s private interest (or the interest of a member of his or her family) interferes, or even 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) takes actions or has interests that may make it difficult to perform his or her work for the Company objectively and effectively. Conflicts of interest also arise when an employee, officer or director (or a member of his or her family) receives improper personal benefits as a result of his or her position in the Company.
 
    3.2  Loans by the Company to, or guarantees by the Company of obligations of, employees or their family members are of special concern and could constitute improper personal benefits to the recipients of such loans or guarantees, depending on the facts and circumstances. Loans by the Company to, or guarantees by the Company of obligations of, any director or executive officer or their family members are expressly prohibited.
 
    3.3  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 3.4.
 
    3.4  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 or the President until such time as the Company appoints a Chief Compliance Officer. 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 the Chief Compliance Officer (or President if the Company has no Chief Compliance Officer) with a written description of the activity and seeking the written approval of the Chief Compliance Officer, or the President, as applicable. If the supervisor is himself involved in the potential or actual conflict, the matter should instead be discussed directly with the Chief Compliance Officer/President, as applicable.
 
Directors and executive officers must seek determinations and prior authorizations or approvals of potential conflicts of interest exclusively from the Audit Committee.
 
 
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4.   Compliance .
 
    4.1  Employees, officers and directors should comply, both in letter and spirit, with all applicable laws, rules and regulations in the cities, states and countries in which the Company operates.
 
    4.2  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 the Legal Department.
 
   4.3  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.
 
5.   Disclosure .
 
    5.1  The Company’s periodic reports and other documents filed with the SEC, including all financial statements and other financial information, must comply with applicable federal securities laws and SEC rules.
 
    5.2  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.
 
 
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    5.3  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 SEC and all other public communications about the financial and business condition of the Company provide full, fair, accurate, timely and understandable disclosure.
 
6.   Protection and Proper Use of Company Assets .
 
    6.1  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.
 
    6.2  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.
 
    6.3  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.
 
7.   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.
 
8.   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 is required or permitted by law. 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.
 
 
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9.   Fair Dealing . Each director, officer and employee must deal fairly with the Company’s 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. 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.
 
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 Audit Committee.
 
(b)  Actions prohibited by this Code involving anyone other than a director or executive officer must be reported to the reporting person’s supervisor or the Chief Compliance Officer.
 
(c)  After receiving a report of an alleged prohibited action, the Audit Committee, the relevant supervisor or the Chief Compliance Officer must 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 Audit Committee determines that a violation of this Code has occurred, the Audit 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, the relevant supervisor or the Chief Compliance Officer determines that a violation of this Code has occurred, the supervisor or the Chief Compliance Officer will report such determination to the Company’s Legal Counsel.
 
 
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(d)  Upon receipt of a determination that there has been a violation of this Code, the Board of Directors or the Company’s Legal 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.
 
(a)  Each of the Board of Directors (in the case of a violation by a director or executive officer) and the Company’s Legal Counsel (in the case of a violation by any other person) may, in its discretion, waive any violation of this Code.
 
(b)  Any waiver for a director or an executive officer shall be disclosed as required by SEC rules.
 
    10.4  Prohibition on Retaliation.
 
    The Company does not tolerate acts of retaliation 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.
 
 
 
 
 
 
 
 
 
 
 
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