TRESU Q3 2023 Financial Report

TRESU Risk factors (continued) 4.3. The Group is dependent on third parties and other factors in- and outside the Group's control The Group's ability to maintain and grow its market share is dependent on its ability to continuously supply its products to its customers on a timely basis. Inability to supply products in a timely manner may also be caused by numerous factors, including factors fully or partially outside of the Group's control. Delayed delivery may lead to claims for damages from customers and/or may lead to the customers switching to the Group's competitors. The Group has production facilities and a sales office in Denmark and sales subsidiaries in USA, Germany, Italy, China and Japan. The Group's production is based on supplies from third party suppliers. For these and other reasons, the Group's operations are dependent on third parties for, among other things, supply of certain critical components and services. As such, the Group is subject to risks associated with operating a supply chain in an efficient manner, e.g. ensuring that components used in the end-products are available in sufficient quantities and qualities in a timely manner and at a competitive price. There can be no assurance that the products or services provided by third parties and necessary to run the business of the Group effectively will be available to the Group in the required quantities and qualities and within the timeframe needed for the Group to meet customer demands, or that third parties will continue to provide products and services to the Group on acceptable prices and terms or at all. Agreed contractual remedies towards third party suppliers may not be enforceable by the Group or may not cover the losses incurred by the Group in the event of material disruptions in the supply chain. While for some components and services alternative third-party suppliers are available, it could be difficult for the Group to replace these relationships on equally attractive commercial terms, or at all, and seeking alternate relationships could be time consuming and result in interruptions to the Group's business, including prolonged interruptions in the supply of the Group's products. The Group's operations, as well as its inventory of components, could be adversely affected by extraordinary events, including fire, mechanical failure, extended or extraordinary maintenance, flood, windstorm or other severe weather conditions, work stoppages, lack of supply of raw materials, directives from government agencies, power interruptions, breakdown in IT-systems or other events outside of the Group's control. Any prolonged interruption could reduce production capacity for prolonged periods. The measures that the Group have in place to mitigate such risks may prove to be insufficient or ineffective. The Group's recovery planning may not prevent business disruption, and reconstruction of damaged facilities could require a significant amount of time and costs. The Group has no control over its suppliers' production sites or distribution facilities. In addition, inventory of components could be damaged or lost. Although the Group carries insurance to cover losses at its production sites and interruptions in the business, such policies are subject to limitations, such as deductibles and maximum liability amounts and, therefore, may not cover all losses, including lost sales. The Group may also incur losses that are outside of the coverage of its insurance policies. In the future, the Group may not be able to continue or obtain insurance coverage at current levels, or at all, and premiums may increase significantly on the coverage that is maintained. Any of the above could have a material adverse effect on the Group's business, financial condition and results of operations and could result in a loss for each Bondholder of part or all of each Bondholder's investment in the Bonds. 4.4 Customer concentration Several key customers, including large liquid packaging and folding carton converters, have historically accounted for a significant proportion of capital sales and a material reduction in the spend from one or more of the Group's key customers may have a material effect on the Group's business. The volume of sales to these customers invariably varies from year to year as there is no fixed or exclusive supplier relationship. Spend on capital goods may vary from year to year depending on the customers' capital expenditure plans, budgets and requirements. A material reduction in spend with the Group either due to cancellation, postponement or downsize in orders could have material adverse effect on the Group's business or results of operations and could result in a loss for each Bondholder of part or all of each Bondholder's investment in the Bonds. 51

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