16 mar Notice of possible delays and price increase

The war in Ukraine shocks the whole world and each and every one of us. We have not seen such a brutal invasion of a large, peaceful neighboring country in Europe since World War II.

It is with great dismay that we all observe the news flow with constant military attacks that cause great destruction and where millions of people are forced to flee their homes. The main focus for all of us is, of course, the humanitarian situation for the people of Ukraine, and many good forces are in motion to assist people on the run.

It should be duly noted that Norac has no products in our range in the market which are produced in Russia, nor do we have any business or other relationship with Russian companies.

Russia and Ukraine are among the world’s largest exporters of critical raw materials such as gas and oil, as well as metals such as aluminum, nickel, copper and steel. As a result, the war and the sanctions against Russia have a significant negative effect on production, transport, availability and price development in a number of sectors.

For Norac, the war has led to an unforeseen, acute situation, with restrictions on raw material supply, and where energy prices also increase drastically. It is uncertain how long this will last. We expect a number of manufacturers / our subcontractors to notify us of raw material shortages, and that prices in various markets and sectors will rise rapidly. You may rest assure that we will do everything in our power to minimize the effects for our customers with the measures that can reasonably be expected from us as a supplier.

There is reason to assume that the situation for several of our suppliers will constitute justified force majeure, and that the burdensome situation thus qualifies for discharge from liability also for Norac for delays in accordance with our delivery terms. For fixed price agreements, this may result in  increased costs for the customer in connection with a possible forced delivery.

We would like a dialogue with our customers in order to, as soon as possible, get an overview of the demands and willingness to pay in the period ahead, which in turn will enable us to make the right priorities. Based on this, we will specify the following delivery conditions that will take effect when Norac can refer to force majeure / relevant delivery obstacles, until the situation normalizes. We will in any case keep our customers updated as we go along and get an overview of the situation.

• If goods are to be delivered, all prices will be based on the prices and exchange rates as of the date of the order confirmation. In the case of fixed price agreements, a price change must be confirmed in advance by the customer, alternatively the customer may have to accept major delays.

This means that Norac reserves the right to change prices.

• Delays in our deliveries may occur without liability for Norac.

The above applies to all agreements entered into, and for the agreed prices and delivery conditions, from the commencement of the exceptional situation and as long as it lasts.

We hope that the delays and inconveniences in the period to come will be of scale that allows for the contracts to be completed, with possible adjustments for price and time. At the same time we recognize that it may be in the interest of both parties to terminate the delivery. We are therefore willing to discuss this as well.

We ask for your understanding and thank you for your cooperation.

Best regards

Norac AS
Rune Aarrestad
Sign
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Chief Executive Officer