Related Party Transactions

12 Months Ended

Dec. 31, 2021

The significant related party transactions occurring during the years ended December 31, 2021, 2020 and 2019 are described below. We believe all of our transactions with related parties are at prices that approximate market.

Glencore ownership

As of December 31, 2021, Glencore plc and its affiliates (together "Glencore") beneficially owned 42.9% of Century’s outstanding common stock (46.4% on a fully-diluted basis assuming the conversion of all of the Series A Convertible Preferred Stock) and all of our outstanding Series A Convertible Preferred Stock. See Note 7. Shareholders' Equity for a full description of our outstanding Series A Convertible Preferred Stock. Century and Glencore enter into various transactions from time to time such as the purchase and sale of primary aluminum, purchase and sale of alumina and raw materials, tolling agreements as well as forward financial contracts and borrowing and other debt transactions.

Sales to Glencore

For the years ended December 31, 2021, 2020 and 2019 we derived approximately 60%, 64% and 65% of our consolidated sales from Glencore, respectively.

Glencore purchases aluminum produced at our U.S. smelters at prices based on the LME plus the Midwest regional delivery premium plus any additional market-based product premiums. Glencore purchases aluminum produced at our Grundartangi, Iceland smelter at prices based on the LME plus the European Duty Paid premium plus any additional market-based product premiums.

We have entered into agreements with Glencore pursuant to which we sell certain amounts of alumina at market-based prices. For the years ended December 31, 2021, 2020 and 2019 we recorded $18.3 million, $17.9 million, and $28.7 million of revenue related to alumina sales to Glencore, respectively.

Purchases from Glencore

We purchase a portion of our alumina and certain other raw material requirements from Glencore. Alumina purchases from Glencore during 2021 were priced based on published alumina and aluminum indices as well as fixed prices.

Glencore Agreement Settlement

In July 2021, we reached a full and final legal settlement agreement with Glencore resolving a dispute related to alumina purchases and, accordingly, recorded a $4.0 million settlement loss to Cost of goods sold. This amount was paid during the fourth quarter.

Financial contracts with Glencore

We have certain financial contracts with Glencore. See Note 1 8 . Derivatives regarding these forward financial sales contracts.

Hawesville Term Loan

On April 29, 2019, we entered into a loan agreement with Glencore Ltd. pursuant to which the Company borrowed $40.0 million (the "Hawesville Term Loan”). See Note 6. Debt for additional information. Borrowings under the Hawesville Term Loan were used to partially finance the second phase of the Hawesville restart project. The Hawesville Term Loan has been fully repaid as of December 31, 2021.

Summary

A summary of the aforementioned significant related party transactions for the years ended December 31, 2021, 2020 and 2019 is as follows:


	Year Ended December 31,
	2021		2020		2019
Net sales to Glencore	$	1,337.0	$	1,025.5	$	1,191.6
Purchases from Glencore (2)	334.6		197.6		323.9
Purchases from BHH (1)	—		—		17.8

(1) We previously owned a 40% interest in Baise Haohai Carbon Co. Ltd. ("BHH") and purchased carbon anodes from them for use in our operations. Purchases represented herein were prior to the divestiture of our interest in BHH in May 2019.

(2) Includes settlements of financial contract positions.