What changed in this filing

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Item 1A. Risk Factors

2025-03-03 compared with 2024-03-15 · 80 added, 106 removed, 352 unchanged (35% of the section changed)

11 unchanged sentences

• Curtailment of our production capacities and/or aluminum reduction facilities

• Casthouse Project at Grundartangi and related financing

• Inability to realize benefits from capital projects

2 unchanged sentences

• Requirement to maintain substantial resources for operations

• Exposure to political, economic, regulatory, currency and other risks related to our international operations

• Exposure to political, economic, regulatory, currency and other risks related to our domestic and international operations

• Unpredictable events affecting operations

2 unchanged sentences

• Risks of Jamalco Joint Venture structure

• Jamalco permitting risks

• Risks related to material weaknesses and ineffective internal controls over financial reporting

Risks Related to Labor and Employees

• Failure to maintain stable and productive labor relations

• Increased labor costs and labor shortages at our operations

Risks Related to Indebtedness and Financing

12 unchanged sentences

• Effects of climate change, climate change legislation and/or environmental regulations

• Effects of health and safety laws and regulations

• Effects of environmental, health and safety laws and regulations

• Effects of trade laws or regulations

1 unchanged sentence

• Realization of benefits under Inflation Reduction Act Section 45X

• Availability of our $500 million DOE funding to support the new aluminum smelter

• Ability to use certain NOLs to offset future taxable income

Risks Related to Acquisition

• Effect of any future acquisitions on the Company and its operations

• Effect of any future acquisitions or joint ventures on the Company and its operations

Risks Related to Stock Ownership

2 unchanged sentences

Declines in overall aluminum prices could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our operating results depend on the market for primary aluminum which can be volatile and subject to many factors

beyond our control.

Our operating results depend on the market for primary aluminum which can be volatile and subject to many factors beyond our control.

The overall price of primary aluminum consists of three components:

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Each of these three components has its own drivers of variability.

The price of aluminum is influenced by a number of factors, including global supply-demand balance, inventory levels, speculative activities by market participants, production activities by global producers, political and economic conditions, as well as raw material and other production costs in major production regions.

The price of aluminum is influenced by a number of factors, including global supply-demand balance, inventory levels, speculative activities by market participants, production activities by global producers, political and economic conditions including the implementation and modifications of tariff regimes, as well as raw material and other production costs in major production regions.

These factors can be highly speculative and difficult to predict which can lead to significant volatility in the price of aluminum.

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Declines in aluminum prices could cause us to curtail production at our operations or take other actions to reduce our cost of production, including deferring certain capital expenditures and maintenance costs and implementing workforce reductions.

Any deferred costs achieved through such curtailments and other cost cutting measures could ultimately result in higher capital expenditures and maintenance costs than would have been incurred had such costs not been deferred and increase the costs to restore production capacity if market forces warrant.

restore production capacity if market forces warrant.

Declines in aluminum prices also negatively impact our liquidity by lowering our borrowing availability under our asset-based revolving credit facilities (due to a lower market value of our inventory and accounts receivable).

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In the U.S., our Hawesville and Sebree plants receive all of their electricity requirements under market-based electricity contracts.

In Iceland, we previously entered into contracts to fix the forward price of approximately 20% of Grundartangi's Nord Pool based power requirements for the year ending December 31, 2023.

These market-based contracts expose us to price volatility and fluctuations due to factors beyond our control and without any direct relationship to the price of primary aluminum.

For example, extreme weather events throughout 2022 across the United States resulted in increases to power prices for our Kentucky plants, which resulted in the curtailment of the Hawesville smelter in the third quarter of 2022.

Previously, in 2021, due in large part to low reservoir levels in Europe and low natural gas inventory in Europe, the monthly Nord Pool power prices more than tripled from January 2021 to December 2021.

More recently, market disruptions in global energy markets related to the war in Ukraine caused significant increases in market-based power prices.

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In addition, the coverage under those policies may not be sufficient to cover all losses, or may not cover certain events.

Certain of our insurance policies do not cover any losses that may be incurred if our suppliers are unable to provide power under certain circumstances.

our insurance policies do not cover any losses that may be incurred if our suppliers are unable to provide power under certain circumstances.

Certain losses or prolonged interruptions in our operations may trigger a default under certain of our outstanding indebtedness and could have a material adverse effect on our business, financial position, results of operations and liquidity.

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Holly to restart the remaining 25% of its curtailed production capacity.

Any potential future restart of this curtailed capacity will be made in light of certain market assumptions that are subject to risks outside of our control, specifically the LME price of aluminum, price and availability of raw materials and price levels of metal premiums.

Any potential future restart of this curtailed capacity will be made in the context of then-current market conditions that are subject to risks outside of our control, specifically the LME price of aluminum, price and availability of raw materials and price levels of metal premiums.

Changes in these inputs may result in actual costs and returns that materially differ from the estimated costs and returns and our financial position and results of operations may be negatively affected as a result.

Changes in these inputs may also make the restart of the remaining curtailed capacity at Mt.

Holly uneconomic.

The restart of production at our Hawesville smelter is subject to certain risks and uncertainties.

Changes in these inputs may also affect the economic viability of restarting the remaining curtailed capacity at Mt.

There can be no assurance that we will be able to restart the 25% of Mt.

Holly's production that remains curtailed within a projected budget and schedule.

In addition to changes in market assumptions, other unforeseen difficulties could increase the cost of a restart, delay a restart or render a restart not feasible.

Our ability to finance a restart could also be impacted by our cash position and results of operations.

Any delay in the completion of such a project, unexpected or increased costs or inability to fund a restart could have a material adverse effect on our business, financial position, results of operations and liquidity.

Future options with respect to our Hawesville smelter remain subject to strategic review.

In the third quarter of 2022, we curtailed all operations at our Hawesville smelter.

Any potential restart of operations at the Hawesville smelter would be based on certain market assumptions that would be subject to risks outside of our control, specifically the LME price of aluminum, price and availability of raw materials and price levels of metal premiums.

We continue to explore all options related to the Hawesville smelter and have engaged financial advisors and launched a formal process to evaluate strategic alternatives and potential value to help us in our overall evaluation of this asset.

There can be no assurance that we will decide to sell Hawesville, that we will be able to sell Hawesville on commercially attractive terms, or at all, or that if we elect to restart Hawesville, that such restarted operations would be profitable.

Any potential future restart of operations at the Hawesville smelter will be made in the context of then-current market conditions that are subject to risks outside of our control, specifically the LME price of aluminum, price and availability of raw materials and price levels of metal premiums.

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Any delay in the completion of the project, unexpected or increased costs or inability to fund the restart could have a material adverse effect on our business, financial position, results of operations and liquidity.

The casthouse project at our Grundartangi smelter and related financing are subject to certain risks and uncertainties and we may be unable to realize the expected benefits of this project.

On November 3, 2021, we announced plans for construction of a new billet casthouse at Grundartangi.

The new value-added casthouse will have a capacity of 150,000 tonnes of billet production and is expected to start production in the first quarter of 2024.

Our ability to complete this Casthouse Project and the timing and costs of doing so are subject to various risks and certain market assumptions, many of which are beyond our control.

Changes in our inputs, whether costs or availability, may result in actual costs and returns that materially differ from the estimated costs and returns and our financial position and results of operations may be negatively affected as a result.

There can be no assurance that we will be able to complete the Casthouse Project within our projected budget and schedule.

In addition to changes in market assumptions, other unforeseen difficulties could increase the cost of the project, delay the project or render the project not feasible.

Any delay in the completion of the project, unexpected or increased costs or inability to fund the project could have a material adverse effect on our business, financial position, results of operations and liquidity.

In connection with the Casthouse Project, Grundartangi entered into a Term Facility Agreement with Arion Bank hf to provide for borrowings up to $130.0 million (the “Casthouse Facility”).

Our ability to make payments on and to refinance the Casthouse Facility will depend on our ability to generate cash in the future.

Our ability to pay interest on and to repay or refinance the Casthouse Facility will depend upon our access to additional sources of liquidity and future operating performance, which is subject to general economic, financial, competitive, legislative, regulatory, business and other factors, including market prices for primary aluminum, that are beyond our control.

Accordingly, there can be no assurance that our business will generate sufficient cash flow from operations or that future borrowings will be available to us in an amount sufficient to enable us to pay debt service obligations under the Casthouse Facility.

If we are unable to meet our debt service obligations under the Casthouse Facility, it may have a material adverse effect on our business, financial position, results of operations and liquidity.

Increases in our raw material costs and disruptions in our supply of raw materials could adversely affect our business .

Our business depends upon the adequate supply of alumina, aluminum fluoride, calcined petroleum coke, pitch, carbon anodes, cathodes, alloys, caustic soda, natural gas, heavy fuel oil, and other raw materials.

For some of these production inputs, such as alumina, coke, pitch and cathodes, we do not have any internal production and rely on a limited number of suppliers for all of our requirements.

For some of these production inputs, such as coke, pitch and cathodes, we do not have any internal production and rely on a limited number of suppliers for all of our requirements.

Many of our supply agreements are short term or expire in the next few years.

There is no assurance that we will be able to renew such agreements on commercially favorable terms, if at all.

labor costs, competition, weather conditions and other transportation delays, major force majeure events, pandemics, tariffs, sanctions and currency exchange rates.

Certain of our principal raw materials are commodities for which, at times, availability and pricing can be volatile due to a number of factors beyond our control, including general economic conditions, inflationary impacts, domestic and worldwide demand, labor costs, competition, weather conditions and other transportation delays, major force majeure events, pandemics, tariffs, sanctions and currency exchange rates.

Because we rely on a limited number of suppliers, if our suppliers cannot meet their contracted volume commitments or other contractual requirements, it may be difficult for us to source our raw materials from alternative suppliers at commercially reasonable prices or within the time periods required by our operations, if at all.

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We are also exposed to price risk for each of these raw material commodities.

For example, the pricing under certain of our current alumina supply contracts is based on a published alumina index.

As a result, our cost structure is exposed to market fluctuations and price volatility.

During 2018, for example, external events in the alumina markets, including the partial curtailment of the Alunorte alumina refinery in Brazil due to environmental concerns following severe weather and U.S.

sanctions impacting UC Rusal’s ability to supply alumina to the market, caused significant price volatility.

As a result of these events, the alumina index price reached a high of $710 per tonne in April 2018 compared to an average price of $343 per tonne in 2023, $ 362 per tonne for 2022, and $329 per tonne for 2021.

For example, from time to time we may enter into alumina supply contracts that are based on a published alumina index.

As a result, our cost structure may be exposed to market fluctuations and price volatility.

During 2024, for example, external events in the alumina markets, including the export ban in Guinea, caused significant price volatility.

As a result of these events, the alumina index price reached a high of $805 per tonne in December 2024 compared to an average price of $343 per tonne in 2023 and $ 362 per tonne for 2022.

From time to time, we manage our exposure to fluctuations in our alumina costs by purchasing certain of our alumina requirements under supply contracts with prices tied to the LME price of aluminum.

Because we sell our products based on the LME price for primary aluminum, we are not able to pass on to our customers any increased cost of raw materials that are not linked to the LME price.

Because we sell our products based on published market prices, we are not able to pass on to our customers any increased cost of raw materials that are not linked to such prices.

The availability of our raw materials at competitive prices is critical to the profitability of our operations and increases in pricing and/or disruptions in our supply could have a material adverse effect on our business, financial position, results of operations and liquidity.

1 unchanged sentence

From time to time, we undertake strategic capital projects in order to enhance, expand and/or upgrade our facilities and operational capabilities.

For instance, within the past several years, we have undertaken expansion projects at each of our Sebree, Hawesville, Grundartangi, Mt.

For instance, within the past several years, we have undertaken expansion projects at each of our Jamalco, Sebree, Grundartangi, Mt.

Holly and Vlissingen facilities.

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We have obligations under certain contracts to take-or-pay for specified raw materials or services over the term of those contracts regardless of our operating requirements.

To the extent that we curtail production at any of our operations, we may continue to be obligated to take or pay for goods or services under these contracts as if we were operating at full production, which reduces the cost savings advantages of curtailing aluminum production.

Our financial position and results of operations may also be adversely affected by the market price for such materials or services as we will continue to incur costs under these contracts to meet or settle our contractual take-or-pay obligations.

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Insufficient rain in Iceland has and could in the future lead to low water levels in the reservoirs which has resulted and may again result in curtailments in power which is provided to our Grundartangi smelter from hydroelectric and geothermal sources.

In early July 2024, Hurricane Beryl temporarily impacted our operations in Jamaica.

We suffered a disruption in our shipments of alumina as the port facility was impacted by the natural disaster, where a portion of the alumina conveyor was damaged.

Jamalco secured alternative port arrangements to allow for alumina shipments to its customers while the repairs to the conveyor were ongoing.

We accept delivery of necessary raw materials to our operations using public infrastructure such as river systems and seaports.

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Our acquisition of a 55% interest in Jamalco in May 2023 substantially expanded the scope and size of our business by adding Jamalco’s bauxite mining and alumina refining operations to our existing primary aluminum production.

Operating bauxite mining and alumina refining assets may require different operating strategies and managerial expertise than our other operations, and these operations are subject to additional and/or different regulatory requirements.

See “We may be unable to obtain, maintain, or renew permits or approvals necessary for Jamalco’s operations, which could materially adversely affect our business” below.

The integration of Jamalco’s operations may place strain on our administrative and operational infrastructure and the Jamalco business may not perform as expected following the acquisition.

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Jamalco is operated as an unincorporated joint venture, which may pose unique risks to its operations.

Joint ventures inherently involve unique and special risks as joint venture partners may have divergent strategies to operate the joint venture's business and operations, and partners may take (or fail to take) certain actions and positions, or experience difficulties, that may negatively impact the joint venture’s business and operating results.

While Century is the operating partner at Jamalco through its wholly owned subsidiary General Alumina Jamaica Limited (“GAJL”), our joint venture partner, Clarendon Alumina Production Limited (“CAP”), retains substantial shareholder rights that could impact Jamalco’s business, such as approval of annual budgets, major capital investments, and expansion into additional areas of

Furthermore, due to the structure of the Jamalco joint venture, each partner may from time to time be required to fund capital contributions necessary for Jamalco’s business.

If Century and its joint venture partner were to have material disagreements about the operation of Jamalco’s business or fail to make required capital contributions when required, it could have a material adverse impact on our business, financial condition and results of operations.

Joint ventures inherently involve unique and special risks as joint venture partners may have business goals and may take (or fail to take) certain actions and positions, or experience difficulties, that may negatively impact the partnership.

While Century is the operating partner at Jamalco through its wholly owned subsidiary General Alumina Jamaica Limited (“GAJL”), our joint venture partner, Clarendon Alumina Production Limited (“CAP”), retains certain review and participation rights that, if exercised in a manner to counter Century's interest, could impact the partners effectiveness and the efficiency of the decision making process.

Furthermore, due to the structure of the Jamalco joint venture, each partner may from time to time be requested to fund capital contributions necessary for Jamalco’s business.

If Century and its joint venture partner were to have material disagreements about the operation of Jamalco’s business or if our joint venture partner were to fail to make capital contributions when requested, it could have a material adverse impact on our business, financial condition and results of operations.

Additionally, the unincorporated nature of Jamalco’s joint venture structure is highly complex and atypical when compared to commonly observed legal entity structures across many jurisdictions.

This atypical structure may drive unique and special legal, accounting, tax, and/or compliance outcomes, which are complex and difficult to ascertain and analyze.

For example, we identified a material weakness in the design of our internal control over the allocation of excess fair value acquired between non-controlling interest and the preliminary deferred bargain purchase gain.

For additional information on the foregoing, see “Item 9A — Controls and procedures — Management’s Report on Internal Control over Financial Reporting.”

We may be unable to obtain, maintain, or renew permits or approvals necessary for Jamalco’s operations, which could materially adversely affect our business.

Jamalco’s operations are subject to extensive permitting and approval requirements.

These include permits and approvals issued by Jamaican government agencies and regulatory bodies.

The permitting and approval rules are complex, are often subject to interpretations by regulators, which may change over time.

Changing regulatory requirements could make our ability to comply with the applicable requirements more difficult, inhibit or delay our ability to timely obtain the necessary approvals, if at all, result in approvals being conditioned in a manner that may restrict Jamalco’s ability to efficiently and economically conduct its operations or preclude the continuation of certain ongoing operations.

Failure to obtain, maintain, or renew permits or approvals, or permitting or approval delays, restrictions, or conditions could increase Jamalco’s costs and affect our ability to conduct our operations, potentially having a materially adverse impact on our business, financial condition and results of operations.

For example, we identified material weaknesses in the design and implementation of our internal control over information technology general controls (ITGCs) and business process level controls related to Jamalco.

For additional information on the foregoing, see Item 9A, "Controls and procedures" and "If we fail to maintain proper and effective internal controls over financial reporting, our financial results may not be accurately reported " below.

If we fail to maintain proper and effective internal controls over financial reporting, our financial results may not be accurately reported.

As disclosed in Item 9A, "Controls and Procedures," of this Annual Report, in fiscal 2023, we identified a material weakness in our internal control over financial reporting related to the application of purchase accounting to our acquisition of Jamalco.

This material weakness was remediated in fiscal 2024.

However, further material weaknesses were identified as of December 31, 2024 related to information technology general controls and business process controls, as more fully disclosed in Item 9A, “Controls and Procedures." The additional material weaknesses did not cause any misstatements to the consolidated financial statements, and there were no changes to previously issued financial results.

We are actively developing remediation plans designed to address the material weaknesses;

however, we cannot guarantee that these steps will be sufficient or that we will not have a material weakness in the future.

Any material weakness, or difficulties encountered in implementing new or improved controls or remediation, could prevent us from accurately reporting our financial results, resulting in material misstatements in our financial statements, or cause us to fail to meet our reporting obligations, which in turn could negatively affect our business, financial condition and results of operations

Risks Related to Labor and Employees

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The bargaining unit employees at our Grundartangi, Hawesville, Sebree, Vlissingen and Jamalco facilities are represented by labor unions, representing approximately 59% of our total workforce as of December 31, 2024.

Our Grundartangi labor agreement is effective through December 31, 2024.

Our Vlissingen labor agreement is effective through May 31, 2024.

Our Grundartangi labor agreement was effective through December 31, 2024, the Company is currently in negotiations with the labor union on a new agreement.

Our Vlissingen labor agreement is effective through December 31, 2025.

Our Hawesville and Sebree labor agreements are scheduled to expire April 1, 2026, and October 28, 2028, respectively.

Jamalco’s work force is represented through separately negotiated labor agreements for hourly and salaried employee groups.

Both contracts are effective through December 31, 2023.

Jamalco is currently in the process of negotiating new contracts with both the salaried and hourly employee groups.

While we are hopeful to reach agreement with the labor unions to renew these agreements on acceptable terms when these agreements expire, there is no assurance that we will be successful in doing so.

Both contracts were effective through December 31, 2023, and Jamalco is currently in the process of negotiating new contracts with both the salaried and hourly employee groups.

Although the Jamalco contracts expired more than a year ago, this timing gap between the expiration of an old contract and the implementation of a new contract is consistent with past practice and local expectations.

While we are hopeful to reach agreement with each of the labor unions to renew these agreements on acceptable terms as and when such agreements expire, there can be no assurance that we will be successful in doing so.

If we fail to maintain satisfactory relations with any labor union representing our employees, our labor contracts may not prevent a strike or work stoppage at any of these facilities in the future.

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Any threatened or actual work stoppage in the future or inability to renegotiate our collective bargaining agreements could prevent or significantly impair our production capabilities subject to these collective bargaining agreements, which could have a material adverse effect on our business, financial position, results of operations and liquidity.

Labor shortages or increased labor costs may materially adversely affect our business, financial condition and results of operations.

Our employees are integral to the success of our operations and with meeting our operational objectives.

Any impact of labor shortages or increased labor costs because of COVID-19 pandemic, increased competition for employees, unemployment levels and benefits, higher employee turnover rates or other employee benefits costs may increase our labor costs or impact our ability to operate our facilities efficiently and could have a material adverse effect on our business, results of operations, and financial condition.

Like many U.S.

businesses, we did experience increasing levels of turnover at all of our U.S.

locations in 2022 and increased labor costs.

Recruiting and retaining employees in sufficient numbers to optimize our workforce levels may result in increased labor costs which could in turn lead to a material adverse effect on our results of operations and financial position.

Risks Related to Indebtedness and Financing

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Our industrial revenue bonds ("IRBs") and borrowings on our U.S.

and Iceland revolving credit facilities as well as the Casthouse Facility and Iceland Term Facility are currently at variable interest rates, and future borrowings required to fund working capital at our businesses, capital expenditures, acquisitions, or other strategic opportunities may be at variable rates, which exposes us to interest rate risk.

and Iceland revolving credit facilities as well as the Casthouse Facility and Vlissingen Facility are currently at variable interest rates, and future borrowings required to fund working capital at our businesses, capital expenditures, acquisitions, or other strategic opportunities may be at variable rates, which exposes us to interest rate risk.

An increase in interest rates would increase our debt service obligations under our existing debt instruments and potentially any future debt instruments, further limiting cash flow available for other uses.

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Our debt instruments subject us to covenants and restrictions.

Our existing debt instruments contain various covenants that restrict the way we conduct our business and limit our ability to incur debt, pay dividends and engage in transactions such as acquisitions and investments, among other things, which may

impair our ability to obtain additional liquidity and grow our business.

Any failure to comply with those covenants would likely constitute a breach under such debt instruments which may result in the acceleration of all or a substantial portion of our outstanding indebtedness and termination of commitments under our U.S.

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Cyber security incidents may include, but are not limited to, attempts to gain unauthorized system access to install malicious software such as ransomware or malware, direct fraudulent payments to fictitious vendors, disrupt production process control and financial systems, and release of confidential or otherwise protected information and data.

In addition, during the past few years, a greater number of our employees are working remotely as a result of the COVID-19 pandemic, which may increase cybersecurity vulnerabilities and risk to our information technology systems.

On February 16, 2022, we became aware of a cybersecurity intrusion that caused a network disruption and impacted certain of our systems.

Upon detection, we took steps to address the incident, including engaging both internal resources and a team of third-party experts to investigate and respond to this intrusion.

Due to the evolving nature and scope of cybersecurity threats, the scope and impact of any incident, including the February 16, 2022 incident, cannot be predicted, including the scope of any potential impacts on our business, financial position and results of operations.

Due to the evolving nature and scope of cybersecurity threats, the scope and impact of any incident, cannot be predicted, including the scope of any potential impacts on our business, financial position and results of operations.

While the Company continually works to safeguard and strengthen our information technology systems and invest in our information technology infrastructure to mitigate potential risks, there is no assurance that such actions will be sufficient to prevent cyber-attacks or security breaches that damage or interrupt access to information systems or networks, compromise confidential or otherwise protected information, destroy or corrupt data, or otherwise disrupt our operations.

In addition, we may not be able to contain a targeted cybersecurity incident to any one particular operating location.

Furthermore, although the Company does maintain insurance in its operations, such insurance may not cover all liabilities and losses associated with any sort of cyber incident or security breach (including the February 2022 incident).

Furthermore, although the Company does maintain insurance in its operations, such insurance may not cover all liabilities and losses associated with any sort of cyber incident or security breach.

The occurrence of such events could negatively impact our reputation and our competitive position and could result in litigation with third parties, regulatory action, loss of business, potential liability and increased remediation costs, any of which could have a material adverse effect on our financial condition and results of operations.

Such security breaches

could also result in a violation of applicable U.S.

Such security breaches could also result in a violation of applicable U.S.

and international privacy and other laws and could have a material adverse effect on our business, results of operations and financial position.

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Such laws and regulations could have a variety of adverse effects on our business.

There is an increasing global and U.S.

regulatory focus and scrutiny on GHG emission and their potential impacts on climate change.

For example, electricity represents our single largest operating cost and the availability of electricity at competitive prices is critical to the profitability of our operations.

Some of the power we purchase in the United States is generated at coal-based power plants, which have been, and are likely to continue to be, significantly impacted by these types of regulations, including the Paris Agreement, which the United States re-entered on February 19, 2021.

Any resulting increase in our operating costs could have a material adverse effect on our business, financial position, results of operations and liquidity.

Even small increases in power prices could have a disproportionate impact on our business if such price increases are not supported by then current aluminum prices.

In addition, as a member of the EEA and a signatory to the Kyoto Protocol, Iceland has implemented legislation to abide by the Kyoto Protocol and Directive 2003/87/EC of the European Parliament (the "Directive") which establishes a "cap and trade" scheme for greenhouse gas emission allowance trading.

There is an increasing global regulatory focus and scrutiny on GHG emission and their potential impacts on climate change.

For example, as a member of the EEA and a signatory to the Kyoto Protocol, Iceland has implemented legislation to abide by the Kyoto Protocol and Directive 2003/87/EC of the European Parliament (the "Directive") which establishes a "cap and trade" scheme for greenhouse gas emission allowance trading.

Iceland is complying with the Directive by participating in the European Union ("EU") Emission Trading System which requires us to purchase carbon dioxide allowances for our Grundartangi smelter.

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For example, "cap and trade" legislation may impose significant additional costs to our power suppliers that could lead to significant increases in our energy costs.

In addition, the potential physical impacts of climate change on our operations are highly uncertain and will be particular to the geographic circumstances.

These may include changes in rainfall patterns, shortages of water or other natural resources, changing sea levels, changing storm patterns and intensities, and changing temperature levels.

Any adverse regulatory and physical changes may have a material adverse effect on our business, financial position, results of operations and liquidity.

We and our suppliers are subject to a variety of environmental laws and regulations that may have a material adverse effect on our business, financial position, results of operations and liquidity.

We are subject to a variety of environmental laws and regulations that may have a material adverse effect on our business, financial position, results of operations and liquidity.

Our operations may impact the environment and our properties may have environmental contamination, which could result in material liabilities for us.

We are obligated to comply with various foreign, federal, state and other environmental laws and regulations, including the environmental laws and regulations of the United States, Iceland and the EU.

We are obligated to comply with various foreign, federal, state and other environmental laws

and regulations, including the environmental laws and regulations of the United States, Iceland and the EU.

Environmental laws and regulations may expose us to costs or liabilities relating to our manufacturing operations or property ownership.

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Liability may also be imposed on a joint and several basis, such that we may be held responsible for more than our share of the contamination or other damages.

If more stringent compliance or cleanup standards under environmental laws or regulations are imposed, previously unknown environmental conditions or damages to natural resources are discovered or alleged, or if contributions from other responsible parties with respect to sites for which we have cleanup responsibilities are not available, we may be subject to

additional liability, which may have a material adverse effect on our business, financial condition, results of operations and liquidity.

Further, additional environmental matters for which we may be liable may arise in the future at our present sites where no problem is currently known, with respect to sites previously owned or operated by us, by related corporate entities or by our predecessors, or at sites that we may acquire or operate in the future.

In addition, overall production costs may become prohibitively expensive and prevent us from effectively competing in price sensitive markets if future capital expenditures and costs for environmental compliance or cleanup are significantly greater than expected.

In addition, many of our key suppliers are subject to environmental laws and regulations that may affect their costs of production resulting in an increase in the price of the products that we purchase from them.

Application of existing and new environmental laws and regulations to us and/or our key suppliers may have a material adverse effect on our business, financial position, results of operations and liquidity.

Application of existing and new environmental laws and regulations to us may have a material adverse effect on our business, financial position, results of operations and liquidity.

Our operations are subject to a variety of laws that regulate the protection of the health and safety of our employees, and changes in health and safety laws and regulations could result in significant costs, which could have a material adverse effect on our business, financial position, results of operations and liquidity.

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As a result, we may incur liabilities in the future associated with assets we no longer own or in which we have a reduced interest.

For a more detailed discussion of pending litigation, see Item 3.

For a more detailed

discussion of pending litigation, see Item 3.

Legal Proceedings and Note 17.

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The Company's ability to benefit from Section 45X production tax credits is not guaranteed and is dependent upon the federal government's ongoing implementation, guidance, regulations, and/or rulemakings that have been the subject of substantial public interest and debate.

In August 2022, President Biden signed the IRA into law.

The IRA provides for substantial tax credits and incentives for the development of critical minerals (including aluminum), renewable energy, clean fuels, electric vehicles, and supporting infrastructure, among other provisions.

The IRA provides for substantial tax credits and incentives for the development of critical minerals (including aluminum), among other provisions.

Section 45X of the IRA contains a production tax credit equal to 10% of certain eligible production costs, including, without limitation, labor, energy, depreciation and amortization and overhead expenses.

On December 14, 2023, the U.S.

Department of the Treasury and the Internal Revenue Service released proposed rules to provide guidance on the production tax credit requirements under Internal Revenue Code Section 45X (the “Proposed Regulations”).

The Proposed Regulations provide guidance on rules that taxpayers must satisfy to qualify for the Section 45X tax credit.

While Section 45X of the IRA provides for substantial tax benefits for Century, the Proposed Regulations have not been finalized and remain subject to public comment.

There is uncertainty as to how the provisions under the IRA will be interpreted and implemented.

The Company’s ability to ultimately benefit from IRA tax credits is not guaranteed and is dependent to a large degree upon the final scope, terms and conditions of the Proposed Regulations.

Certain provisions of the IRA have been the subject of substantial public interest and have been subject to debate, and there are divergent views on potential implementation, guidance, rules, and regulatory principles by a diverse group of interested parties.

There can be no assurance that the Company’s domestic aluminum production operations will fully qualify for the benefits under the IRA.

As a result, the final interpretation and implementation of the provisions in the IRA could have a material adverse impact on the Company.

Furthermore, future legislative enactments or administrative actions could limit, amend, repeal, or terminate IRA policies or other incentives that the Company currently hopes to leverage.

On October 24, 2024, the U.S.

Department of the Treasury and the Internal Revenue Service released final rules to provide guidance on the production tax credit requirements under Internal Revenue Code Section 45X (the “Final Regulations”).

The Final Regulations provide guidance on rules that taxpayers must satisfy to qualify for the Section 45X tax credit.

While Section 45X of the IRA provides for substantial tax benefits for Century, there is some uncertainty as to how certain provisions under the IRA will be interpreted and implemented.

Furthermore, future legislative enactments or administrative actions could limit, amend, repeal, or terminate IRA policies or other incentives that the Company currently hopes to benefit from.

Any reduction, elimination, or discriminatory application or expiration of the IRA may materially adversely affect the Company’s future operating results and liquidity.

Our $500 million funding from the U.S.

Department of Energy (“DOE”) is subject to review and will be subject to negotiation of specific terms and contingent on our compliance with the requirements negotiated with the DOE.

On January 10, 2025, the Company entered into a Cooperative Agreement with the DOE’s Office of Clean Energy Demonstrations for up to $500 million in Bipartisan Infrastructure Law and Inflation Reduction Act (“Inflation Reduction Act”) funding to build a new aluminum smelter in the United States.

Since that time, the issuance of certain Executive Orders, including the Unleashing American Energy Executive Order on January 20, 2025, has required an immediate pause in the disbursement of funds appropriated through the Inflation Reduction Act pending a 90-day review period.

The Company is currently evaluating this Executive Order and other related memoranda to determine what, if any, impact they might have on or our previously announced DOE funding.

If the DOE proceeds with our funding as planned, such funding will additionally remain subject to certain compliance obligations and other terms and conditions.

As previously announced, the DOE funding will support the construction of a new aluminum smelter in the Mississippi/Ohio River basins, however to complete this project, we will need to obtain substantial additional financing, and there can be no assurance that such financing will be available on acceptable terms or at all.

We may also seek additional government grants and incentive awards to support construction of the new aluminum smelter and our ability to obtain such additional grants or incentives in the future is subject to the availability of funds under applicable government programs and approval of our applications to participate in such programs.

The application process for these grants and other incentives is highly competitive and we may not be successful in obtaining any additional grants, loans or other incentives.

Our ability to utilize certain net operating loss carryforwards to offset future taxable income may be significantly limited if we experience an "ownership change" under the Internal Revenue Code.

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What changed 10-K

Item 1A. Risk Factors