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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
52-2107911
|
(State of incorporation)
|
(I.R.S. Employer Identification No.)
|
Large accelerated filer
|
o
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Accelerated filer
|
ý
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Non-accelerated filer
|
o
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Smaller reporting company
|
o
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Page
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PART I – FINANCIAL INFORMATION
|
|
|
|
|
Item 1.
|
Financial Statements:
|
|
|
||
|
||
|
||
|
||
|
||
|
||
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PART II – OTHER INFORMATION
|
|
|
|
|
|
June 30,
2013 |
|
December 31,
2012 |
||||
ASSETS
|
|
|
|
||||
Current Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
194.7
|
|
|
$
|
292.9
|
|
Restricted cash
|
3.3
|
|
|
—
|
|
||
Accounts receivable, net
|
140.9
|
|
|
134.8
|
|
||
Inventories
|
959.9
|
|
|
1,593.2
|
|
||
Deferred costs associated with deferred revenue
|
118.7
|
|
|
116.8
|
|
||
Other current assets
|
18.5
|
|
|
19.2
|
|
||
Total Current Assets
|
1,436.0
|
|
|
2,156.9
|
|
||
Property, Plant and Equipment, net
|
18.4
|
|
|
51.0
|
|
||
Other Long-Term Assets
|
|
|
|
|
|
||
Deposits for surety bonds
|
29.4
|
|
|
22.3
|
|
||
Goodwill
|
—
|
|
|
6.8
|
|
||
Other assets
|
28.4
|
|
|
29.4
|
|
||
Total Other Long-Term Assets
|
57.8
|
|
|
58.5
|
|
||
Total Assets
|
$
|
1,512.2
|
|
|
$
|
2,266.4
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
|
|
|
|
|
|
||
Current Liabilities
|
|
|
|
|
|
||
Accounts payable and accrued liabilities
|
$
|
154.3
|
|
|
$
|
145.8
|
|
Payables under Russian Contract
|
177.3
|
|
|
209.8
|
|
||
Inventories owed to customers and suppliers
|
350.6
|
|
|
950.0
|
|
||
Deferred revenue and advances from customers
|
165.0
|
|
|
125.5
|
|
||
Credit facility term loan
|
—
|
|
|
83.2
|
|
||
Convertible preferred stock
|
107.0
|
|
|
100.5
|
|
||
Total Current Liabilities
|
954.2
|
|
|
1,614.8
|
|
||
Long-Term Debt
|
530.0
|
|
|
530.0
|
|
||
Other Long-Term Liabilities
|
|
|
|
|
|
||
Postretirement health and life benefit obligations
|
212.6
|
|
|
207.2
|
|
||
Pension benefit liabilities
|
180.3
|
|
|
321.7
|
|
||
Other liabilities
|
54.3
|
|
|
65.6
|
|
||
Total Other Long-Term Liabilities
|
447.2
|
|
|
594.5
|
|
||
Commitments and Contingencies (Note 15)
|
|
|
|
|
|
||
Stockholders’ Equity (Deficit)
|
(419.2
|
)
|
|
(472.9
|
)
|
||
Total Liabilities and Stockholders’ Equity (Deficit)
|
$
|
1,512.2
|
|
|
$
|
2,266.4
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Separative work units
|
$
|
267.4
|
|
|
$
|
347.2
|
|
|
$
|
557.6
|
|
|
$
|
885.1
|
|
Uranium
|
13.9
|
|
|
3.6
|
|
|
41.5
|
|
|
3.6
|
|
||||
Contract services
|
3.5
|
|
|
3.0
|
|
|
6.1
|
|
|
7.1
|
|
||||
Total Revenue
|
284.8
|
|
|
353.8
|
|
|
605.2
|
|
|
895.8
|
|
||||
Cost of Sales:
|
|
|
|
|
|
|
|
|
|
||||||
Separative work units and uranium
|
328.2
|
|
|
340.4
|
|
|
632.0
|
|
|
841.6
|
|
||||
Contract services
|
3.5
|
|
|
3.2
|
|
|
6.8
|
|
|
7.3
|
|
||||
Total Cost of Sales
|
331.7
|
|
|
343.6
|
|
|
638.8
|
|
|
848.9
|
|
||||
Gross profit (loss)
|
(46.9
|
)
|
|
10.2
|
|
|
(33.6
|
)
|
|
46.9
|
|
||||
Advanced technology costs
|
46.2
|
|
|
85.4
|
|
|
105.5
|
|
|
122.1
|
|
||||
Selling, general and administrative
|
11.9
|
|
|
13.2
|
|
|
24.8
|
|
|
26.8
|
|
||||
Special charges for workforce reductions and advisory costs
|
3.7
|
|
|
3.2
|
|
|
6.1
|
|
|
9.6
|
|
||||
Other (income)
|
(40.7
|
)
|
|
(10.0
|
)
|
|
(88.3
|
)
|
|
(10.0
|
)
|
||||
Operating (loss)
|
(68.0
|
)
|
|
(81.6
|
)
|
|
(81.7
|
)
|
|
(101.6
|
)
|
||||
Interest expense
|
9.3
|
|
|
12.7
|
|
|
22.6
|
|
|
25.4
|
|
||||
Interest (income)
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.4
|
)
|
|
(0.2
|
)
|
||||
(Loss) from continuing operations before income taxes
|
(77.2
|
)
|
|
(94.2
|
)
|
|
(103.9
|
)
|
|
(126.8
|
)
|
||||
Provision (benefit) for income taxes
|
(36.3
|
)
|
|
(2.1
|
)
|
|
(39.3
|
)
|
|
(5.4
|
)
|
||||
Net (loss) from continuing operations
|
(40.9
|
)
|
|
(92.1
|
)
|
|
(64.6
|
)
|
|
(121.4
|
)
|
||||
Net income from discontinued operations
|
—
|
|
|
0.1
|
|
|
21.7
|
|
|
0.6
|
|
||||
Net (loss)
|
$
|
(40.9
|
)
|
|
$
|
(92.0
|
)
|
|
$
|
(42.9
|
)
|
|
$
|
(120.8
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share (Note 14):
|
|
|
|
|
|
|
|
||||||||
Net (loss) from continuing operations per share – basic and diluted
|
$
|
(8.35
|
)
|
|
$
|
(18.80
|
)
|
|
$
|
(13.18
|
)
|
|
$
|
(24.78
|
)
|
Net (loss) per share – basic and diluted
|
$
|
(8.35
|
)
|
|
$
|
(18.78
|
)
|
|
$
|
(8.76
|
)
|
|
$
|
(24.65
|
)
|
Weighted-average number of shares outstanding – basic and diluted
|
4.9
|
|
|
4.9
|
|
|
4.9
|
|
|
4.9
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Net (loss)
|
$
|
(40.9
|
)
|
|
$
|
(92.0
|
)
|
|
$
|
(42.9
|
)
|
|
$
|
(120.8
|
)
|
Other comprehensive income, before tax:
|
|
|
|
|
|
|
|
|
|
||||||
Gain arising during the period (Note 11)
|
138.3
|
|
|
—
|
|
|
138.3
|
|
|
—
|
|
||||
Amortization of actuarial (gains) losses, net (Note 11)
|
6.1
|
|
|
6.0
|
|
|
12.9
|
|
|
12.0
|
|
||||
Amortization of prior service costs (Note 11)
|
0.5
|
|
|
0.4
|
|
|
0.7
|
|
|
0.8
|
|
||||
Other comprehensive income, before tax
|
144.9
|
|
|
6.4
|
|
|
151.9
|
|
|
12.8
|
|
||||
Income tax expense related to items of other comprehensive income
|
(53.9
|
)
|
|
(2.3
|
)
|
|
(56.5
|
)
|
|
(4.6
|
)
|
||||
Other comprehensive income, net of tax
|
91.0
|
|
|
4.1
|
|
|
95.4
|
|
|
8.2
|
|
||||
Comprehensive income (loss)
|
$
|
50.1
|
|
|
$
|
(87.9
|
)
|
|
$
|
52.5
|
|
|
$
|
(112.6
|
)
|
|
Six Months Ended
June 30, |
||||||
|
2013
|
|
2012
|
||||
Cash Flows from Operating Activities
|
|
|
|
||||
Net (loss)
|
$
|
(42.9
|
)
|
|
$
|
(120.8
|
)
|
Adjustments to reconcile net (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
16.4
|
|
|
19.5
|
|
||
Transfer of machinery and equipment to U.S. Department of Energy
|
—
|
|
|
44.6
|
|
||
Deferred income taxes
|
—
|
|
|
(4.6
|
)
|
||
Other non-cash income on release of disposal obligation
|
—
|
|
|
(10.0
|
)
|
||
Convertible preferred stock dividends payable-in-kind
|
6.5
|
|
|
5.8
|
|
||
Gain on sale of subsidiary
|
(35.6
|
)
|
|
—
|
|
||
Non-cash transition charges
|
31.0
|
|
|
—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||
Accounts receivable – (increase)
|
(6.1
|
)
|
|
(11.4
|
)
|
||
Inventories, net – decrease
|
24.0
|
|
|
340.3
|
|
||
Payables under Russian Contract – (decrease)
|
(32.5
|
)
|
|
(65.2
|
)
|
||
Deferred revenue, net of deferred costs – increase
|
37.6
|
|
|
27.1
|
|
||
Accounts payable and other liabilities – increase (decrease)
|
(44.3
|
)
|
|
3.6
|
|
||
Accrued depleted uranium disposition – increase (decrease)
|
0.4
|
|
|
(73.5
|
)
|
||
Other, net
|
(3.3
|
)
|
|
6.7
|
|
||
Net Cash Provided by (Used in) Operating Activities
|
(48.8
|
)
|
|
162.1
|
|
||
|
|
|
|
||||
Cash Flows Provided by Investing Activities
|
|
|
|
|
|
||
Capital expenditures
|
—
|
|
|
(4.1
|
)
|
||
Deposits for surety bonds - net (increase) decrease
|
(7.1
|
)
|
|
43.8
|
|
||
Proceeds from sale of subsidiary
|
43.2
|
|
|
—
|
|
||
Net Cash Provided by Investing Activities
|
36.1
|
|
|
39.7
|
|
||
|
|
|
|
||||
Cash Flows Used in Financing Activities
|
|
|
|
|
|
||
Borrowings under revolving credit facility
|
—
|
|
|
123.6
|
|
||
Repayments under revolving credit facility
|
—
|
|
|
(123.6
|
)
|
||
Repayment of credit facility term loan
|
(83.2
|
)
|
|
—
|
|
||
Payments for deferred financing costs
|
(2.1
|
)
|
|
(9.8
|
)
|
||
Common stock issued (purchased), net
|
(0.2
|
)
|
|
(0.6
|
)
|
||
Net Cash (Used in) Financing Activities
|
(85.5
|
)
|
|
(10.4
|
)
|
||
Net Increase (Decrease)
|
(98.2
|
)
|
|
191.4
|
|
||
Cash and Cash Equivalents at Beginning of Period
|
292.9
|
|
|
37.6
|
|
||
Cash and Cash Equivalents at End of Period
|
$
|
194.7
|
|
|
$
|
229.0
|
|
Supplemental Cash Flow Information:
|
|
|
|
|
|
||
Interest paid
|
$
|
11.8
|
|
|
$
|
13.2
|
|
Income taxes paid, net of refunds
|
0.4
|
|
|
0.5
|
|
|
Common Stock,
Par Value
$.10 per Share
|
|
Excess of
Capital over
Par Value
|
|
Retained
Earnings
(Deficit)
|
|
Treasury
Stock
|
|
Accumulated
Other Comprehensive Income (Loss)
|
|
Total
|
||||||||||||
Six Months Ended June 30, 2012
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at December 31, 2011
|
$
|
13.0
|
|
|
$
|
1,212.5
|
|
|
$
|
(161.2
|
)
|
|
$
|
(49.4
|
)
|
|
$
|
(262.5
|
)
|
|
$
|
752.4
|
|
Other comprehensive income, net of tax (Note 16)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.2
|
|
|
8.2
|
|
||||||
Restricted and other common stock issued, net of amortization
|
—
|
|
|
(13.7
|
)
|
|
—
|
|
|
16.5
|
|
|
—
|
|
|
2.8
|
|
||||||
Reverse stock split of 1 share for 25 (Note 1)
|
(12.5
|
)
|
|
12.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net (loss)
|
—
|
|
|
—
|
|
|
(120.8
|
)
|
|
—
|
|
|
—
|
|
|
(120.8
|
)
|
||||||
Balance at June 30, 2012
|
$
|
0.5
|
|
|
$
|
1,211.3
|
|
|
$
|
(282.0
|
)
|
|
$
|
(32.9
|
)
|
|
$
|
(254.3
|
)
|
|
$
|
642.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Six Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance at December 31, 2012
|
$
|
13.0
|
|
|
$
|
1,200.8
|
|
|
$
|
(1,361.8
|
)
|
|
$
|
(33.0
|
)
|
|
$
|
(291.9
|
)
|
|
$
|
(472.9
|
)
|
Other comprehensive income, net of tax (Note 16)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
95.4
|
|
|
95.4
|
|
||||||
Restricted and other common stock issued, net of amortization
|
—
|
|
|
3.5
|
|
|
—
|
|
|
(2.3
|
)
|
|
—
|
|
|
1.2
|
|
||||||
Reverse stock split of 1 share for 25 (Note 1)
|
(12.5
|
)
|
|
12.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net (loss)
|
—
|
|
|
—
|
|
|
(42.9
|
)
|
|
—
|
|
|
—
|
|
|
(42.9
|
)
|
||||||
Balance at June 30, 2013
|
$
|
0.5
|
|
|
$
|
1,216.8
|
|
|
$
|
(1,404.7
|
)
|
|
$
|
(35.3
|
)
|
|
$
|
(196.5
|
)
|
|
$
|
(419.2
|
)
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Revenue
|
$
|
—
|
|
|
$
|
11.0
|
|
|
$
|
13.7
|
|
|
$
|
30.5
|
|
Cost of sales
|
—
|
|
|
8.9
|
|
|
11.8
|
|
|
26.3
|
|
||||
Gross profit
|
—
|
|
|
2.1
|
|
|
1.9
|
|
|
4.2
|
|
||||
Advanced technology costs
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.4
|
|
||||
Selling, general and administrative
|
—
|
|
|
1.6
|
|
|
1.8
|
|
|
2.9
|
|
||||
Operating income
|
—
|
|
|
0.2
|
|
|
0.1
|
|
|
0.9
|
|
||||
Gain on sale of subsidiary
|
—
|
|
|
—
|
|
|
35.6
|
|
|
—
|
|
||||
Income before income taxes
|
—
|
|
|
0.2
|
|
|
35.7
|
|
|
0.9
|
|
||||
Provision for income taxes
|
—
|
|
|
0.1
|
|
|
14.0
|
|
|
0.3
|
|
||||
Net income from discontinued operations
|
$
|
—
|
|
|
$
|
0.1
|
|
|
$
|
21.7
|
|
|
$
|
0.6
|
|
-
|
Asset retirement charges of
$19.3 million
in the three and six months ended June 30, 2013 for property, plant and equipment formerly used in the enrichment process at the Paducah GDP;
|
-
|
Inventory valuation adjustments totaling
$10.0 million
in the three and six months ended June 30, 2013, including
$7.7 million
of residual uranium contained in certain cylinders that will be transferred to DOE. USEC determined that it was currently uneconomic to recover this residual uranium for resale;
|
-
|
Site expenses, including lease turnover activities, of
$20.1 million
in the three and six months ended June 30, 2013. Following the cessation of enrichment at the Paducah GDP, costs for plant activities that formerly were capitalized as production costs will now be charged directly to cost of sales including inventory management and disposition, ongoing regulatory compliance, utility requirements for operations, security, and other site management activities related to transition of facilities and infrastructure;
|
-
|
Power contract losses of
$11.8 million
in the three and six months ended June 30, 2013. In anticipation of a potential short-term extension of uranium enrichment at the Paducah GDP, USEC purchased approximately 700 megawatts of power for the period from June 1 through September 30, 2013 from several power providers. Due to falling prices in power markets following the purchase of this power, as part of agreements to unwind these purchases, USEC incurred expenses of approximately $11.8 million;
|
-
|
Accelerated asset charges of
$8.2 million
in the six months ended June 30, 2013. Beginning in the fourth quarter of 2012, the expected productive life of property, plant and equipment at the Paducah GDP was reduced from the lease term ending June 2016 to an accelerated basis ending December 2014. In addition,
|
-
|
Portsmouth retiree benefit costs of
$6.3 million
in the six months ended June 30, 2013 and
$6.6 million
in the six months ended June 30, 2012. Prior to the start of 2012, a significant portion of the costs related to pension and postretirement health and life benefit plans were attributed to Portsmouth contract services, based on the employee base performing contract services work. Starting in 2012, ongoing retiree benefit costs related to USEC's former Portsmouth employees are charged to cost of sales of the low enriched uranium ("LEU") segment rather than the contract services segment based on continuing operations that support USEC's active and retired employees.
|
•
|
$87.7 million
of funding was provided by DOE accepting title to quantities of depleted uranium that enabled USEC to release encumbered funds that were providing financial assurance for the disposition of this depleted uranium;
|
•
|
$45.7 million
of funding was provided pursuant to the six-month continuing appropriations resolution passed by Congress and signed by the President on September 28, 2012;
|
•
|
$44.4 million
of funding was provided in March 2013 by DOE transferring the separative work unit ("SWU") component of LEU that DOE previously acquired from USEC in exchange for the transfer of quantities of USEC’s depleted uranium to DOE; and
|
•
|
$49.9 million
of funding was provided pursuant to the FY2013 continuing appropriations resolution, through amendments to the cooperative agreement on June 13, 2013 and July 24, 2013.
|
|
June 30,
2013 |
|
December 31,
2012 |
||||
|
(millions)
|
||||||
Utility customers
|
$
|
105.2
|
|
|
$
|
118.3
|
|
DOE pro-rata share of RD&D program funding
|
24.2
|
|
|
4.4
|
|
||
Contract services, primarily DOE:
|
|
|
|
|
|
||
Billed revenue
|
9.3
|
|
|
10.5
|
|
||
Unbilled revenue
|
2.2
|
|
|
1.6
|
|
||
|
11.5
|
|
|
12.1
|
|
||
|
$
|
140.9
|
|
|
$
|
134.8
|
|
|
June 30, 2013
|
|
December 31, 2012
|
||||||||||||||||||||
|
Current
Assets
|
|
Current
Liabilities
(a)
|
|
Inventories, Net
|
|
Current
Assets
|
|
Current
Liabilities
(a)
|
|
Inventories, Net
|
||||||||||||
Separative work units
|
$
|
660.0
|
|
|
$
|
163.8
|
|
|
$
|
496.2
|
|
|
$
|
880.9
|
|
|
$
|
382.7
|
|
|
$
|
498.2
|
|
Uranium
|
295.7
|
|
|
186.8
|
|
|
108.9
|
|
|
703.7
|
|
|
567.3
|
|
|
136.4
|
|
||||||
Materials and supplies
|
4.2
|
|
|
—
|
|
|
4.2
|
|
|
8.6
|
|
|
—
|
|
|
8.6
|
|
||||||
|
$
|
959.9
|
|
|
$
|
350.6
|
|
|
$
|
609.3
|
|
|
$
|
1,593.2
|
|
|
$
|
950.0
|
|
|
$
|
643.2
|
|
(a)
|
Inventories owed to customers and suppliers, included in current liabilities, consist primarily of SWU and uranium inventories owed to fabricators. Fabricators process LEU into fuel for use in nuclear reactors. Under inventory optimization arrangements between USEC and domestic fabricators, fabricators order bulk quantities of LEU from USEC based on scheduled or anticipated orders from utility customers for deliveries in future periods. As delivery obligations under actual customer orders arise, USEC satisfies these obligations by arranging for the transfer to the customer of title to the specified quantity of LEU at the fabricator. USEC’s balances of SWU and uranium vary over time based on the timing and size of the fabricator’s LEU orders from USEC and the fabricator's needs for working stock of LEU. Balances can be positive or negative at the discretion of the fabricator. Fabricators have other inventory supplies and, where a fabricator has elected to order less material from USEC than USEC is required to deliver to its customers at the fabricator, the fabricator will use these other inventories to satisfy USEC’s customer order obligations on USEC’s behalf. In such cases, the transfer of title of LEU from USEC to the customer results in quantities of SWU and uranium owed by USEC to the fabricator. The amounts of SWU and uranium owed to fabricators are satisfied as future bulk deliveries of LEU are made.
|
|
December 31,
2012 |
|
Capital Expenditures (Depreciation)
|
|
Transfers and Retirements
|
|
Ceasing of Enrichment at Paducah
|
|
June 30,
2013 |
||||||||||
Construction work in progress
|
$
|
2.7
|
|
|
$
|
—
|
|
|
$
|
(0.6
|
)
|
|
$
|
(1.7
|
)
|
|
$
|
0.4
|
|
Leasehold improvements
|
183.7
|
|
|
—
|
|
|
(0.6
|
)
|
|
—
|
|
|
183.1
|
|
|||||
Machinery and equipment
|
181.7
|
|
|
—
|
|
|
(9.3
|
)
|
|
—
|
|
|
172.4
|
|
|||||
|
368.1
|
|
|
—
|
|
|
(10.5
|
)
|
|
(1.7
|
)
|
|
355.9
|
|
|||||
Accumulated depreciation and amortization
|
(317.1
|
)
|
|
(11.3
|
)
|
|
8.5
|
|
|
(17.6
|
)
|
|
(337.5
|
)
|
|||||
|
$
|
51.0
|
|
|
$
|
(11.3
|
)
|
|
$
|
(2.0
|
)
|
|
$
|
(19.3
|
)
|
|
$
|
18.4
|
|
|
June 30, 2013
|
|
December 31, 2012
|
||||
|
(millions)
|
||||||
Deferred revenue
|
$
|
143.3
|
|
|
$
|
123.1
|
|
Advances from customers
|
21.7
|
|
|
2.4
|
|
||
|
$
|
165.0
|
|
|
$
|
125.5
|
|
|
|
|
|
||||
Deferred costs associated with deferred revenue
|
$
|
118.7
|
|
|
$
|
116.8
|
|
|
June 30,
2013 |
|
December 31,
2012 |
||||
|
(millions)
|
||||||
Borrowings under the revolving credit facility
|
$
|
—
|
|
|
$
|
—
|
|
Term loan
|
—
|
|
|
83.2
|
|
||
Letters of credit
|
3.1
|
|
|
14.7
|
|
||
Available credit
|
76.9
|
|
|
87.1
|
|
|
December 31,
2012 |
|
Additions
|
|
Reductions
|
|
June 30,
2013 |
||||||||
Other current assets:
|
|
|
|
|
|
|
|
||||||||
Bank credit facilities
|
$
|
3.0
|
|
|
$
|
2.1
|
|
|
$
|
(4.1
|
)
|
|
$
|
1.0
|
|
|
|
|
|
|
|
|
|
||||||||
Deferred financing costs (long-term):
|
|
|
|
|
|
|
|
|
|
|
|
||||
Convertible notes
|
$
|
3.6
|
|
|
$
|
—
|
|
|
$
|
(1.0
|
)
|
|
$
|
2.6
|
|
•
|
Level 1 – quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2 – inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
|
•
|
Level 3 – unobservable inputs in which little or no market data exists.
|
|
Fair Value Measurements
(in millions)
|
||||||||||||||||||||||||||
|
June 30, 2013
|
|
December 31, 2012
|
||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash equivalents (a)
|
—
|
|
|
$
|
194.5
|
|
|
—
|
|
|
$
|
194.5
|
|
|
—
|
|
|
$
|
292.2
|
|
|
—
|
|
|
$
|
292.2
|
|
Deferred compensation asset (b)
|
—
|
|
|
2.8
|
|
|
—
|
|
|
2.8
|
|
|
—
|
|
|
2.7
|
|
|
—
|
|
|
2.7
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Deferred compensation obligation (b)
|
—
|
|
|
2.7
|
|
|
—
|
|
|
2.7
|
|
|
—
|
|
|
2.7
|
|
|
—
|
|
|
2.7
|
|
(a)
|
Cash equivalents consist of funds invested in institutional money market funds. These investments are classified within Level 2 of the valuation hierarchy because unit prices of institutional funds are estimated prices using observable, market-based inputs.
|
(b)
|
The deferred compensation obligation represents the balance of deferred compensation plus net investment earnings. The deferred compensation plan is informally funded through a rabbi trust using variable universal life insurance. The cash surrender value of the life insurance policies is designed to track the deemed investments of the plan participants. Investment crediting options consist of institutional and retail investment funds. The deemed investments are classified within Level 2 of the valuation hierarchy because (i) of the indirect method of investing and (ii) unit prices of institutional funds are not quoted in active markets.
|
|
June 30, 2013
|
|
December 31, 2012
|
||||||||||||
|
Carrying Value
|
|
Fair
Value
|
|
Carrying Value
|
|
Fair
Value
|
||||||||
Credit facility term loan
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
83.2
|
|
|
$
|
93.5
|
|
Convertible preferred stock and accrued dividends payable-in-kind
|
107.0
|
|
|
107.0
|
|
|
100.5
|
|
|
100.5
|
|
||||
3.0% convertible senior notes, due October 1, 2014
|
530.0
|
|
|
119.3
|
|
|
530.0
|
|
|
198.2
|
|
|
Defined Benefit Pension Plans
|
|
Postretirement Health and Life Benefit Plans
|
||||||||||||||||||||||||||||
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||||||||||
Service costs
|
$
|
3.7
|
|
|
$
|
3.7
|
|
|
$
|
7.4
|
|
|
$
|
7.3
|
|
|
$
|
0.9
|
|
|
$
|
0.9
|
|
|
$
|
1.8
|
|
|
$
|
1.8
|
|
Interest costs
|
11.0
|
|
|
12.0
|
|
|
22.0
|
|
|
24.1
|
|
|
2.3
|
|
|
2.8
|
|
|
4.5
|
|
|
5.6
|
|
||||||||
Expected returns on plan assets (gains)
|
(12.7
|
)
|
|
(13.0
|
)
|
|
(25.5
|
)
|
|
(26.0
|
)
|
|
(0.6
|
)
|
|
(0.7
|
)
|
|
(1.2
|
)
|
|
(1.4
|
)
|
||||||||
Amortization of prior service costs
|
0.5
|
|
|
0.4
|
|
|
0.7
|
|
|
0.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Amortization of actuarial (gains) losses, net
|
6.1
|
|
|
4.9
|
|
|
12.2
|
|
|
9.8
|
|
|
0.7
|
|
|
1.1
|
|
|
1.4
|
|
|
2.2
|
|
||||||||
Curtailment (gains)
|
(0.7
|
)
|
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net benefit costs
|
$
|
7.9
|
|
|
$
|
8.0
|
|
|
$
|
16.1
|
|
|
$
|
16.0
|
|
|
$
|
3.3
|
|
|
$
|
4.1
|
|
|
$
|
6.5
|
|
|
$
|
8.2
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
|
(millions)
|
||||||||||||||
Total stock-based compensation costs:
|
|
|
|
|
|
|
|
||||||||
Restricted stock and restricted stock units
|
$
|
0.4
|
|
|
$
|
1.3
|
|
|
$
|
1.3
|
|
|
$
|
2.5
|
|
Stock options, performance awards and other
|
—
|
|
|
0.2
|
|
|
0.1
|
|
|
0.5
|
|
||||
Less: costs capitalized as part of inventory
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
||||
Expense included in selling, general and administrative and advanced technology costs
|
$
|
0.4
|
|
|
$
|
1.4
|
|
|
$
|
1.4
|
|
|
$
|
2.9
|
|
Total recognized tax benefit
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
|
(millions)
|
||||||||||||||
Numerators:
|
|
|
|
|
|
|
|
||||||||
Net (loss) from continuing operations
|
$
|
(40.9
|
)
|
|
$
|
(92.1
|
)
|
|
$
|
(64.6
|
)
|
|
$
|
(121.4
|
)
|
Net income from discontinued operations
|
—
|
|
|
0.1
|
|
|
21.7
|
|
|
0.6
|
|
||||
Net (loss)
|
$
|
(40.9
|
)
|
|
$
|
(92.0
|
)
|
|
$
|
(42.9
|
)
|
|
$
|
(120.8
|
)
|
Numerators for diluted calculations (a):
|
|
|
|
|
|
|
|
|
|
||||||
Net (loss) from continuing operations
|
$
|
(40.9
|
)
|
|
$
|
(92.1
|
)
|
|
$
|
(64.6
|
)
|
|
$
|
(121.4
|
)
|
Net income from discontinued operations
|
—
|
|
|
0.1
|
|
|
21.7
|
|
|
0.6
|
|
||||
Net (loss)
|
$
|
(40.9
|
)
|
|
$
|
(92.0
|
)
|
|
$
|
(42.9
|
)
|
|
$
|
(120.8
|
)
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
|
|
||||||
Weighted average common shares
|
5.0
|
|
|
5.0
|
|
|
5.0
|
|
|
5.0
|
|
||||
Less: Weighted average unvested restricted stock
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
||||
Denominator for basic calculation
|
4.9
|
|
|
4.9
|
|
|
4.9
|
|
|
4.9
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Weighted average effect of dilutive securities:
|
|
|
|
|
|
|
|
|
|
||||||
Convertible notes
|
1.8
|
|
|
1.8
|
|
|
1.8
|
|
|
1.8
|
|
||||
Convertible preferred stock:
|
|
|
|
|
|
|
|
|
|
||||||
Equivalent common shares (b)
|
10.0
|
|
|
3.1
|
|
|
8.9
|
|
|
3.0
|
|
||||
Less: share issuance limitation (c)
|
9.1
|
|
|
2.2
|
|
|
8.0
|
|
|
2.1
|
|
||||
Net allowable common shares
|
0.9
|
|
|
0.9
|
|
|
0.9
|
|
|
0.9
|
|
||||
Subtotal
|
2.7
|
|
|
2.7
|
|
|
2.7
|
|
|
2.7
|
|
||||
Less: shares excluded in a period of a net loss or antidilution
|
2.7
|
|
|
2.7
|
|
|
2.7
|
|
|
2.7
|
|
||||
Weighted average effect of dilutive securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Denominator for diluted calculation
|
4.9
|
|
|
4.9
|
|
|
4.9
|
|
|
4.9
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net (loss) per share from continuing operations – basic and diluted
|
$
|
(8.35
|
)
|
|
$
|
(18.80
|
)
|
|
$
|
(13.18
|
)
|
|
$
|
(24.78
|
)
|
Net income per share from discontinued operations – basic and diluted
|
$
|
—
|
|
|
$
|
0.02
|
|
|
$
|
4.43
|
|
|
$
|
0.12
|
|
Net (loss) per share – basic and diluted
|
$
|
(8.35
|
)
|
|
$
|
(18.78
|
)
|
|
$
|
(8.76
|
)
|
|
$
|
(24.65
|
)
|
(a)
|
The numerators are subject to increase for interest expense on convertible notes and convertible preferred stock dividends, net of tax, of
$5.1 million
in the three months ended June 30, 2013 and
$10.0 million
in the six months ended June 30, 2013. The tax rate is the statutory rate. Net interest expense on convertible notes and convertible preferred stock dividends was
$4.8 million
in the three months ended June 30, 2012 and
$9.5 million
in the six months ended June 30, 2012.
|
(b)
|
The number of equivalent common shares for the convertible preferred stock is based on the arithmetic average of the daily volume weighted average prices per share of common stock for each of the last 20 trading days, and is determined as of the beginning of the period for purposes of calculating diluted net income per share.
|
(c)
|
Prior to obtaining shareholder approval, the preferred stock may not be converted into an aggregate number of shares of common stock in excess of
19.99%
of the shares of our common stock outstanding on May 25, 2010 (approximately
0.9 million
shares adjusted to take into account the 1-for-25 reverse stock split), in compliance with the rules of the New York Stock Exchange. If a share issuance limitation were to exist at the time of share conversion or sale, any preferred stock shares subject to the share issuance limitation would be subject to optional or mandatory redemption for, at USEC's option, cash or SWU consideration. However, USEC’s ability to redeem may be limited by Delaware law, and if not limited may result in mandatory prepayment of USEC’s credit facility.
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
||||||||||||||
|
2013
|
|
|
2012
|
|
|
2013
|
|
|
2012
|
|
||||||||
Options excluded from diluted net income per share
|
2,000
|
|
|
|
116,000
|
|
|
|
2,000
|
|
|
|
116,000
|
|
|
||||
Warrants excluded from diluted net income per share
|
250,000
|
|
|
|
250,000
|
|
|
|
250,000
|
|
|
|
250,000
|
|
|
||||
Exercise price of excluded options
|
$
|
177.50
|
|
to
|
|
$
|
93.00
|
|
to
|
|
$
|
177.50
|
|
to
|
|
$
|
93.00
|
|
to
|
|
$
|
357.00
|
|
|
|
$
|
357.00
|
|
|
|
$
|
357.00
|
|
|
|
$
|
357.00
|
|
|
Exercise price of excluded warrants
|
$
|
187.50
|
|
|
|
$
|
187.50
|
|
|
|
$
|
187.50
|
|
|
|
$
|
187.50
|
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Beginning balance
|
$
|
(287.5
|
)
|
|
$
|
(258.4
|
)
|
|
$
|
(291.9
|
)
|
|
$
|
(262.5
|
)
|
|
|
|
|
|
|
|
|
||||||||
Gain arising during the period
|
138.3
|
|
|
—
|
|
|
138.3
|
|
|
—
|
|
||||
Amortization of actuarial (gains) losses, net (a)
|
6.1
|
|
|
6.0
|
|
|
12.9
|
|
|
12.0
|
|
||||
Amortization of prior service costs (a)
|
0.5
|
|
|
0.4
|
|
|
0.7
|
|
|
0.8
|
|
||||
Total reclassifications for the period, before tax
|
144.9
|
|
|
6.4
|
|
|
151.9
|
|
|
12.8
|
|
||||
Income tax (expense) benefit
|
(53.9
|
)
|
|
(2.3
|
)
|
|
(56.5
|
)
|
|
(4.6
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income (loss), net of tax
|
91.0
|
|
|
4.1
|
|
|
95.4
|
|
|
8.2
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Ending balance
|
$
|
(196.5
|
)
|
|
$
|
(254.3
|
)
|
|
$
|
(196.5
|
)
|
|
$
|
(254.3
|
)
|
(a)
|
These items reclassified from accumulated other comprehensive income (loss) are included in the computation of net benefit costs as detailed in Note 11.
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
|
(millions)
|
||||||||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
LEU segment:
|
|
|
|
|
|
|
|
||||||||
Separative work units
|
$
|
267.4
|
|
|
$
|
347.2
|
|
|
$
|
557.6
|
|
|
$
|
885.1
|
|
Uranium
|
13.9
|
|
|
3.6
|
|
|
41.5
|
|
|
3.6
|
|
||||
|
281.3
|
|
|
350.8
|
|
|
599.1
|
|
|
888.7
|
|
||||
Contract services segment
|
3.5
|
|
|
3.0
|
|
|
6.1
|
|
|
7.1
|
|
||||
|
$
|
284.8
|
|
|
$
|
353.8
|
|
|
$
|
605.2
|
|
|
$
|
895.8
|
|
|
|
|
|
|
|
|
|
||||||||
Segment Gross Profit (Loss)
|
|
|
|
|
|
|
|
|
|
||||||
LEU segment
|
$
|
(46.9
|
)
|
|
$
|
10.4
|
|
|
$
|
(32.9
|
)
|
|
$
|
47.1
|
|
Contract services segment
|
—
|
|
|
(0.2
|
)
|
|
(0.7
|
)
|
|
(0.2
|
)
|
||||
Gross profit (loss)
|
$
|
(46.9
|
)
|
|
$
|
10.2
|
|
|
$
|
(33.6
|
)
|
|
$
|
46.9
|
|
•
|
sales of the SWU component of LEU,
|
•
|
sales of both the SWU and uranium components of LEU, and
|
•
|
sales of uranium.
|
|
June 30,
2013
|
|
December 31,
2012
|
|
June 30,
2012
|
||||||
SWU:
|
|
|
|
|
|
||||||
Long-term price indicator ($/SWU)
|
$
|
120.00
|
|
|
$
|
135.00
|
|
|
$
|
140.00
|
|
Spot price indicator ($/SWU)
|
110.00
|
|
|
120.00
|
|
|
134.00
|
|
|||
UF
6
:
|
|
|
|
|
|
|
|
|
|||
Long-term price composite ($/KgU)
|
165.68
|
|
|
165.68
|
|
|
176.13
|
|
|||
Spot price indicator ($/KgU)
|
113.50
|
|
|
123.50
|
|
|
139.00
|
|
Period Covered
|
Date of Claim
|
Amount of Claim
|
DOE Response
|
Periods through December 31, 2009
|
December 2, 2011
|
$11.2 million
|
Denied by DOE contracting officer in letter dated June 1, 2012
|
Year ended December 31, 2010
|
February 16, 2012
|
$9.0 million
|
Denied by DOE contracting officer in letter dated August 15, 2012
|
Year ended December 31, 2011
|
May 8, 2012
|
$17.8 million
|
Denied by DOE contracting officer in letter dated August 15, 2012
|
|
Three Months Ended
June 30,
|
|
|
|
|
|||||||||
|
2013
|
|
2012
|
|
Change
|
|
%
|
|||||||
LEU segment
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
SWU revenue
|
$
|
267.4
|
|
|
$
|
347.2
|
|
|
$
|
(79.8
|
)
|
|
(23
|
)%
|
Uranium revenue
|
13.9
|
|
|
3.6
|
|
|
10.3
|
|
|
286
|
%
|
|||
Total
|
281.3
|
|
|
350.8
|
|
|
(69.5
|
)
|
|
(20
|
)%
|
|||
Cost of sales
|
328.2
|
|
|
340.4
|
|
|
12.2
|
|
|
4
|
%
|
|||
Gross profit (loss)
|
$
|
(46.9
|
)
|
|
$
|
10.4
|
|
|
$
|
(57.3
|
)
|
|
(551
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Contract services segment
|
|
|
|
|
|
|
|
|
|
|
|
|||
Revenue
|
$
|
3.5
|
|
|
$
|
3.0
|
|
|
$
|
0.5
|
|
|
17
|
%
|
Cost of sales
|
3.5
|
|
|
3.2
|
|
|
(0.3
|
)
|
|
(9
|
)%
|
|||
Gross profit (loss)
|
$
|
—
|
|
|
$
|
(0.2
|
)
|
|
$
|
0.2
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|||||||
Total
|
|
|
|
|
|
|
|
|
|
|
|
|||
Revenue
|
$
|
284.8
|
|
|
$
|
353.8
|
|
|
$
|
(69.0
|
)
|
|
(20
|
)%
|
Cost of sales
|
331.7
|
|
|
343.6
|
|
|
11.9
|
|
|
3
|
%
|
|||
Gross profit (loss)
|
$
|
(46.9
|
)
|
|
$
|
10.2
|
|
|
$
|
(57.1
|
)
|
|
(560
|
)%
|
|
Six Months Ended
June 30,
|
|
|
|
|
|||||||||
|
2013
|
|
2012
|
|
Change
|
|
%
|
|||||||
LEU segment
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
SWU revenue
|
$
|
557.6
|
|
|
$
|
885.1
|
|
|
$
|
(327.5
|
)
|
|
(37
|
)%
|
Uranium revenue
|
41.5
|
|
|
3.6
|
|
|
37.9
|
|
|
1,053
|
%
|
|||
Total
|
599.1
|
|
|
888.7
|
|
|
(289.6
|
)
|
|
(33
|
)%
|
|||
Cost of sales
|
632.0
|
|
|
841.6
|
|
|
209.6
|
|
|
25
|
%
|
|||
Gross profit (loss)
|
$
|
(32.9
|
)
|
|
$
|
47.1
|
|
|
$
|
(80.0
|
)
|
|
(170
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Contract services segment
|
|
|
|
|
|
|
|
|
|
|
|
|||
Revenue
|
$
|
6.1
|
|
|
$
|
7.1
|
|
|
$
|
(1.0
|
)
|
|
(14
|
)%
|
Cost of sales
|
6.8
|
|
|
7.3
|
|
|
0.5
|
|
|
7
|
%
|
|||
Gross profit (loss)
|
$
|
(0.7
|
)
|
|
$
|
(0.2
|
)
|
|
$
|
(0.5
|
)
|
|
(250
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Total
|
|
|
|
|
|
|
|
|
|
|
|
|||
Revenue
|
$
|
605.2
|
|
|
$
|
895.8
|
|
|
$
|
(290.6
|
)
|
|
(32
|
)%
|
Cost of sales
|
638.8
|
|
|
848.9
|
|
|
210.1
|
|
|
25
|
%
|
|||
Gross profit (loss)
|
$
|
(33.6
|
)
|
|
$
|
46.9
|
|
|
$
|
(80.5
|
)
|
|
(172
|
)%
|
|
Three Months Ended
June 30,
|
|
|
|
|
|||||||||
|
2013
|
|
2012
|
|
Change
|
|
%
|
|||||||
Cost of sales for the LEU segment:
|
|
|
|
|
|
|
|
|||||||
SWU and uranium
|
$
|
258.2
|
|
|
$
|
337.1
|
|
|
$
|
(78.9
|
)
|
|
(23
|
)%
|
Non-production expenses
|
70.0
|
|
|
3.3
|
|
|
66.7
|
|
|
2,021
|
%
|
|||
Total
|
$
|
328.2
|
|
|
$
|
340.4
|
|
|
$
|
(12.2
|
)
|
|
(4
|
)%
|
|
Six Months Ended
June 30,
|
|
|
|
|
|||||||||
|
2013
|
|
2012
|
|
Change
|
|
%
|
|||||||
Cost of sales for the LEU segment:
|
|
|
|
|
|
|
|
|||||||
SWU and uranium
|
$
|
556.3
|
|
|
$
|
835.0
|
|
|
$
|
(278.7
|
)
|
|
(33
|
)%
|
Non-production expenses
|
75.7
|
|
|
6.6
|
|
|
69.1
|
|
|
1,047
|
%
|
|||
Total
|
$
|
632.0
|
|
|
$
|
841.6
|
|
|
$
|
(209.6
|
)
|
|
(25
|
)%
|
-
|
Asset retirement charges of $19.3 million in the three and six months ended June 30, 2013 for property, plant and equipment formerly used in the enrichment process at the Paducah GDP;
|
-
|
Inventory valuation adjustments totaling $10.0 million in the three and six months ended June 30, 2013, including $7.7 million of residual uranium contained in certain cylinders that will be transferred to DOE. We determined that it was currently uneconomic to recover this residual uranium for resale;
|
-
|
Site expenses, including lease turnover activities, of $20.1 million in the three and six months ended June 30, 2013. Following the cessation of enrichment at the Paducah GDP, costs for plant activities that formerly were capitalized as production costs will now be charged directly to cost of sales including inventory management and disposition, ongoing regulatory compliance, utility requirements for operations, security, and other site management activities related to transition of facilities and infrastructure;
|
-
|
Power contract losses of $11.8 million in the three and six months ended June 30, 2013. In anticipation of a potential short-term extension of uranium enrichment at the Paducah GDP, we purchased approximately 700 megawatts of power for the period from June 1 through September 30, 2013 from several power providers. Due to falling prices in power markets following the purchase of this power, as part of agreements to unwind these purchases, we incurred expenses of approximately $11.8 million;
|
-
|
Accelerated asset charges of $8.2 million in the six months ended June 30, 2013. Beginning in the fourth quarter of 2012, the expected productive life of property, plant and equipment at the Paducah GDP was reduced from the lease term ending June 2016 to an accelerated basis ending December 2014. In addition, costs that would have been previously treated as construction work in progress are treated similar to maintenance and repair costs because of the shorter expected productive life of the Paducah GDP. The expected productive life of the Paducah GDP was further reduced following the ceasing of enrichment in June 2013;
|
-
|
Portsmouth retiree benefit costs of $6.3 million in the six months ended June 30, 2013 and $6.6 million in the six months ended June 30, 2012. Prior to the start of 2012, a significant portion of the costs related to pension and postretirement health and life benefit plans were attributed to Portsmouth contract services, based on the employee base performing contract services work. Starting in 2012, ongoing retiree benefit costs related to our former Portsmouth employees are charged to cost of sales of the LEU segment rather than the contract services segment based on our continuing operations that support our active and retired employees.
|
|
Three Months Ended
June 30,
|
|
|
|
|
|||||||||
|
2013
|
|
2012
|
|
Change
|
|
%
|
|||||||
Gross profit (loss)
|
$
|
(46.9
|
)
|
|
$
|
10.2
|
|
|
$
|
(57.1
|
)
|
|
(560
|
)%
|
Advanced technology costs
|
46.2
|
|
|
85.4
|
|
|
39.2
|
|
|
46
|
%
|
|||
Selling, general and administrative
|
11.9
|
|
|
13.2
|
|
|
1.3
|
|
|
10
|
%
|
|||
Special charges for workforce reductions and advisory costs
|
3.7
|
|
|
3.2
|
|
|
(0.5
|
)
|
|
(16
|
)%
|
|||
Other (income)
|
(40.7
|
)
|
|
(10.0
|
)
|
|
30.7
|
|
|
307
|
%
|
|||
Operating (loss)
|
(68.0
|
)
|
|
(81.6
|
)
|
|
13.6
|
|
|
17
|
%
|
|||
Interest expense
|
9.3
|
|
|
12.7
|
|
|
3.4
|
|
|
27
|
%
|
|||
Interest (income)
|
(0.1
|
)
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
%
|
|||
(Loss) from continuing operations before income taxes
|
(77.2
|
)
|
|
(94.2
|
)
|
|
17.0
|
|
|
18
|
%
|
|||
Provision (benefit) for income taxes
|
(36.3
|
)
|
|
(2.1
|
)
|
|
34.2
|
|
|
1,629
|
%
|
|||
Net (loss) from continuing operations
|
(40.9
|
)
|
|
(92.1
|
)
|
|
51.2
|
|
|
56
|
%
|
|||
Net income from discontinued operations
|
—
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
(100
|
)%
|
|||
Net (loss)
|
$
|
(40.9
|
)
|
|
$
|
(92.0
|
)
|
|
$
|
(51.1
|
)
|
|
56
|
%
|
|
Six Months Ended
June 30,
|
|
|
|
|
|||||||||
|
2013
|
|
2012
|
|
Change
|
|
%
|
|||||||
Gross profit (loss)
|
$
|
(33.6
|
)
|
|
$
|
46.9
|
|
|
$
|
(80.5
|
)
|
|
(172
|
)%
|
Advanced technology costs
|
105.5
|
|
|
122.1
|
|
|
16.6
|
|
|
14
|
%
|
|||
Selling, general and administrative
|
24.8
|
|
|
26.8
|
|
|
2.0
|
|
|
7
|
%
|
|||
Special charges for workforce reductions and advisory costs
|
6.1
|
|
|
9.6
|
|
|
3.5
|
|
|
36
|
%
|
|||
Other (income)
|
(88.3
|
)
|
|
(10.0
|
)
|
|
78.3
|
|
|
783
|
%
|
|||
Operating (loss)
|
(81.7
|
)
|
|
(101.6
|
)
|
|
19.9
|
|
|
20
|
%
|
|||
Interest expense
|
22.6
|
|
|
25.4
|
|
|
2.8
|
|
|
11
|
%
|
|||
Interest (income)
|
(0.4
|
)
|
|
(0.2
|
)
|
|
0.2
|
|
|
100
|
%
|
|||
(Loss) from continuing operations before income taxes
|
(103.9
|
)
|
|
(126.8
|
)
|
|
22.9
|
|
|
18
|
%
|
|||
Provision (benefit) for income taxes
|
(39.3
|
)
|
|
(5.4
|
)
|
|
33.9
|
|
|
628
|
%
|
|||
Net (loss) from continuing operations
|
(64.6
|
)
|
|
(121.4
|
)
|
|
56.8
|
|
|
47
|
%
|
|||
Net income from discontinued operations
|
21.7
|
|
|
0.6
|
|
|
21.1
|
|
|
3,517
|
%
|
|||
Net (loss)
|
$
|
(42.9
|
)
|
|
$
|
(120.8
|
)
|
|
$
|
(77.9
|
)
|
|
64
|
%
|
•
|
The timing and amount of potential severance costs, pension and postretirement benefit costs and other costs related to the transition of the Paducah GDP;
|
•
|
The timing of recognition of previously deferred revenue;
|
•
|
Movement and timing of customer orders; and
|
•
|
Changes to SWU and uranium price indicators, and changes in inflation that can affect the price of SWU billed to customers.
|
|
Six Months Ended
June 30,
|
||||||
|
2013
|
|
2012
|
||||
Net Cash Provided by (Used in) Operating Activities
|
$
|
(48.8
|
)
|
|
$
|
162.1
|
|
Net Cash Provided by Investing Activities
|
36.1
|
|
|
39.7
|
|
||
Net Cash (Used in) Financing Activities
|
(85.5
|
)
|
|
(10.4
|
)
|
||
Net Increase (Decrease) in Cash and Cash Equivalents
|
$
|
(98.2
|
)
|
|
$
|
191.4
|
|
|
June 30,
2013
|
|
December 31,
2012
|
||||
|
(millions)
|
||||||
Cash and cash equivalents
|
$
|
194.7
|
|
|
$
|
292.9
|
|
Restricted cash
|
3.3
|
|
|
—
|
|
||
Accounts receivable, net
|
140.9
|
|
|
134.8
|
|
||
Inventories, net
|
609.3
|
|
|
643.2
|
|
||
Credit facility term loan, current
|
—
|
|
|
(83.2
|
)
|
||
Convertible preferred stock
|
(107.0
|
)
|
|
(100.5
|
)
|
||
Other current assets and liabilities, net
|
(359.4
|
)
|
|
(345.1
|
)
|
||
Working capital
|
$
|
481.8
|
|
|
$
|
542.1
|
|
|
June 30,
2013
|
|
December 31,
2012
|
||||
|
(millions)
|
||||||
Borrowings under the revolving credit facility
|
$
|
—
|
|
|
$
|
—
|
|
Term loan
|
—
|
|
|
83.2
|
|
||
Letters of credit
|
3.1
|
|
|
14.7
|
|
||
Available credit
|
76.9
|
|
|
87.1
|
|
•
|
the sum of (1) the greater of (a) the JPMorgan Chase Bank prime rate, (b) the federal funds rate plus ½ of 1%, or (c) an adjusted 1-month LIBO Rate (with a floor of 2.0%) plus 1% plus (2) a margin of 2.75%, or
|
•
|
the sum of the adjusted LIBO Rate (with a floor of 2.0%) plus a margin of 4.5%.
|
•
|
If we demobilize the American Centrifuge project, we may pay the costs and expenses of such demobilization in accordance with a plan previously submitted to the agent for the lenders.
|
•
|
If, as part of DOE’s exercise of remedies under the RD&D program, we are required to transfer the American Centrifuge project or the RD&D program assets, in whole or in part, to DOE or its designee, we may spend as needed to maintain compliance with legal and regulatory requirements, but may not spend more than $5 million of proceeds of the revolving loans on such expenses.
|
•
|
We may not spend any proceeds of revolving loans on American Centrifuge expenses if a default or event of default has occurred.
|
•
|
From March 14, 2013, we may spend up to $750,000 on costs that are not allowable costs under the RD&D program.
|
•
|
Lease turnover costs
. We expect to incur significant costs in connection with the return of leased facilities to DOE. During the six months ended June 30, 2013 we incurred site expenses, including lease turnover activities, of $20.1 million. As of June 30, 2013, we have accrued current liabilities for lease turnover costs related to the Paducah GDP totaling approximately $43.8 million. Lease turnover costs are costs incurred in returning the GDP to DOE in accordance with the lease, including removing nuclear material as required and removing USEC-generated waste. Our actual lease turnover costs could be greater than anticipated, which could result in additional demands on our liquidity and could negatively impact our results of operations.
|
•
|
Severance Costs
. We also expect to incur significant severance costs in connection with ceasing enrichment at the Paducah GDP. During the six months ended June 30, 2013, we accrued $2.1 million of severance costs related to an initial workforce reduction of approximately 160 employees that is
|
•
|
Pension and Postretirement benefit costs
. We are engaged in discussions with the Pension Benefit Guaranty Corporation ("PBGC") regarding their assertion that the Portsmouth site transition is a cessation of operations that triggers liability under Employee Retirement Income Security Act of 1974, as amended ("ERISA"), Section 4062(e). We are also in discussions with the PBGC regarding the cessation of enrichment at the Paducah GDP and related transition of employees as part of future reductions in force. Given the significant number of current active employees at Paducah, the amount of any potential liability related to such a transition could be more significant than the preliminary PBGC calculation of the potential ERISA Section 4062(e) liability in connection with the Portsmouth site transition of approximately $130 million. See the Risk Factor in Part I, Item 1A of our Annual Report on Form 10-K “
Our defined benefit pension plans are underfunded and we could be required to place an amount in escrow or purchase a bond with respect to such underfunding that could adversely affect our liquidity.”
|
•
|
Other transition costs
. In addition, other activities that will increase our cost of sales as we transition after ceasing enrichment include inventory management and disposition, ongoing regulatory compliance, utility requirements for operations, security, and other site management activities related to transition of leased areas and infrastructure. For a period of time we will still need to lease certain areas used for ongoing operations such as shipping and handling, inventory management and site services, including deliveries to customers of our inventory of LEU, return or relocation of unused inventories owned by USEC or by customers and others with accounts at USEC, and receipt of Russian material through 2013 under the Russian Contract, or beyond under the Russian Supply Agreement. We are currently evaluating the most cost effective manner of conducting operations at the Paducah GDP to minimize ongoing costs and are in discussions with DOE regarding the timing of our de-lease of facilities at the Paducah GDP. However, we may not be able to reach an agreement with DOE on favorable terms or in the timeframe needed and could have greater than anticipated transition expenses. In addition, we have no assurance that DOE would accept the areas that we wish to de-lease on a schedule that would be cost efficient or meet our timing for deliveries of inventories to customers, fabricators and others.
|
•
|
We expect there to be a transition period of several years, until the American Centrifuge Plant (“ACP”) is in commercial operations, during which we are no longer enriching uranium but are making sales from our existing inventory, from our future purchases under the supply agreement entered into with Russia in March 2011 for the supply of commercial Russian LEU (the “Russian Supply Agreement”) and from other potential sources of supply. We have an objective of minimizing the period of transition until we have a new source of domestic U.S. enrichment production. However, we do not currently have a definitive timeline for the ACP deployment to provide this source of production and the economics of the American Centrifuge project and the Russian Supply Agreement are increasingly challenged as a result of current enrichment market conditions. Absent a definitive timeline for the ACP deployment, ceasing enrichment at Paducah could adversely affect our efforts to pursue the American Centrifuge project, to implement the Russian Supply Agreement or to pursue other options, and could threaten our overall viability.
|
•
|
Ceasing enrichment at Paducah could also adversely affect our relationships with a variety of stakeholders, including customers. Customers could ask us to provide adequate assurances of performance under existing contracts that could adversely affect our business. Customers may also not be
|
•
|
We also have no assurance that we will be able to continue to lease portions of the Paducah GDP. Under the 2002 DOE-USEC Agreement, DOE can transition operations of Paducah from USEC operation to ensure the continuity of domestic enrichment operations and the fulfillment of supply contracts in the event we cease enrichment operations at Paducah prior to six months before USEC has the permanent addition of 3.5 million SWU per year of new capacity installed based on advanced enrichment technology. We are in discussions with DOE regarding an agreement related to the transition of the Paducah GDP and while we believe that maintaining USEC's access to the Paducah GDP would be the best course of action to permit the fulfillment of supply contracts, there can be no assurance that DOE will not seek to exercise this right in a manner that will result in adverse impacts to us, including interfering with our deliveries to customers and our ability to maintain their inventories at Paducah, interfering with our ability to sell and deliver our inventory and impacting our ability to make sales.
|
Period
|
|
(a) Total
Number of
Shares (or
Units)
Purchased(1)
|
|
(b)
Average
Price Paid
Per Share
(or Unit)
|
|
(c) Total Number
of Shares (or Units)
Purchased as Part
of Publicly
Announced Plans
or Programs
|
|
(d) Maximum Number
(or Approximate Dollar
Value) of Shares (or
Units) that May Yet Be
Purchased Under the
Plans or Programs
|
|
|
|
|
|
|
|
|
|
April 1 – April 30
|
|
—
|
|
—
|
|
—
|
|
—
|
May 1 – May 31
|
|
10,280
|
|
$9.13
|
|
—
|
|
—
|
June 1 – June 30
|
|
40
|
|
8.53
|
|
—
|
|
—
|
Total
|
|
10,320
|
|
$9.12
|
|
—
|
|
—
|
(1)
|
Number of shares adjusted for the 1-for-25 reverse stock split effective July 1, 2013.
|
|
|
USEC Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date: August 6, 2013
|
By:
|
/s/ John C. Barpoulis
|
|
|
|
John C. Barpoulis
|
|
|
Senior Vice President and Chief Financial Officer
|
||
|
(Principal Financial Officer)
|
Exhibit No.
|
Description
|
|
|
3.1
|
Certificate of Incorporation of USEC Inc., as amended. (a)
|
|
|
3.2
|
Amended and Restated Bylaws of USEC Inc., dated May 6, 2013, incorporated by reference to Exhibit 3.1 of the Current Report on Form 8-K filed on May 6, 2013.
|
|
|
10.1
|
Amendment No. 001 dated April 22, 2013 to the Enriched Product Transitional Supply Contract dated March 23, 2011 between United States Enrichment Corporation and Joint Stock Company “Techsnabexport.” (Certain information has been omitted and filed separately pursuant to a request for confidential treatment under Rule 24b-2). (a)
|
|
|
10.2
|
Amendment No. 004 dated March 29, 2013 to the Cooperative Agreement (the “Cooperative Agreement”) dated June 12, 2012 between the U.S. Department of Energy and USEC Inc. and American Centrifuge Demonstration, LLC concerning the American Centrifuge Cascade Demonstration Test Program. (a)
|
|
|
10.3
|
Amendment No. 005 dated June 13, 2013 to the Cooperative Agreement. (Certain information has been omitted and filed separately pursuant to a request for confidential treatment under Rule 24b-2). (a)
|
|
|
10.4
|
Amendatory Agreement (Supplement No. 10) dated May 20, 2013, to the Power Contract between Tennessee Valley Authority and United States Enrichment Corporation, dated July 11, 2000 (the “TVA Power Contract”). (Certain information has been omitted and filed separately pursuant to a request for confidential treatment under Rule 24b-2). (a)
|
|
|
10.5
|
Supplement No. 11 dated May 30, 2013 to the TVA Power Contract. (a)
|
|
|
10.6
|
Summary Sheet for 2013 Non-Employee / Non-Investor Director Compensation (a)(b)
|
|
|
31.1
|
Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a).
|
|
|
31.2
|
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a).
|
|
|
32.1
|
Certification of CEO and CFO pursuant to 18 U.S.C. Section 1350.
|
|
|
101
|
Consolidated condensed financial statements from the quarterly report on Form 10-Q for the quarter ended June 30, 2013, furnished in interactive data file (XBRL) format.
|
(a)
|
Filed herewith
|
(b)
|
Management contracts and compensatory plans and arrangements required to be filed as exhibits pursuant to Item 15(b) of this report.
|
1.
|
Item (i) of Paragraph B-2 of the Contract is hereby replaced with the following:
|
“(i)
|
The name and address of the consignee, the First Destination State (as defined in Article 21), the port and facility in the First Destination State to which the EUP will be transported, and if known, the origin and the Obligation Code or other flag of the Natural Uranium to be Delivered (if the latter information is not known, it shall be promptly supplied by USEC when it is provided to USEC − which should be prior to Delivery of the Related Natural Uranium to TENEX − by the third party(ies) providing such Natural Uranium to USEC);”
|
2.
|
The following language shall be added at the end of Paragraph E1-1(a) of the Contract:
|
3.
|
The following forms, which are now included in Appendix F1 of the Contract, are hereby replaced with the corresponding forms in Exhibit 1 of this Amendment No. 001:
|
a.
|
F1-1 “Certificate of Quality and Quantity for Enriched Product in Product Cylinders”;
|
b.
|
F1-2 “Certificate of Quality and Quantity for Enriched Product in P-10 Sample Containers”.
|
4.
|
The following forms, which are now included in Appendix G1 of the Contract, are hereby replaced with the corresponding forms in Exhibit 2 of this Amendment No. 001:
|
a.
|
G1-1 “Delivery Receipt Format for Delivery of Enriched Product in Product Cylinders”;
|
b.
|
G1-2 “Delivery Receipt Format for Delivery of Enriched Product in
|
c.
|
Sample Containers”; and
|
d.
|
G1-3 “Delivery Receipt Format for delivery of Empty Cylinders”.
|
5.
|
The following new forms, which are included in Exhibit 3 of this Amendment No. 001, are hereby added to Appendix F1 and Appendix G1, respectively:
|
a.
|
F1-3 “Delivery Summary
”
; and
|
b.
|
G1-5 “Delivery Receipt Format for Delivery of Empty Sample Containers type P-10 in drums”
.
|
6.
|
*****
|
7.
|
*****
|
Joint Stock Company
“Techsnabexport”
ÎÀÎ «Òåõñíàáýêñïîðò»
|
Certificate of Quality and Quantity
Ñåðòèôèêàò êà÷åñòâà è êîëè÷åñòâà
For Enriched Product in 30B cylinder
Íà Îáîãàùåííûé Ïðîäóêò â êîíòåéíåðå òèïà 30Â
Document 1.1
Äîêóìåíò 1.1
|
Shipment No.
Îòïðàâêà ¹
Lot No.
Ïàðòèÿ ¹
|
||
BUYER:
ÏÎÊÓÏÀÒÅËÜ:
|
CONTRACT No
.
08843672/110033-051D,
EC-SC01-11-UE-03127
ÊÎÍÒÐÀÊÒ ¹ 08843672/110033-051D, EC-SC01-11-UE-03127
|
|||
30B cylinder No.
Êîíòåéíåð 30Â ¹
Valve/Plug seal Nos.
¹¹ ïëîìá íà âåíòèëå è çàãëóøêå
|
P-10 sample container (tube) Nos.
(for reference only)
Ïðîáîîòáîðíèêè òèïà P-10 ¹¹
(òîëüêî äëÿ ññûëêè)
|
|||
PSP /
×åõîë
No.
Seal /
Îòòèñê ïëîìáû
Nos.
|
|
|||
|
30B container
êîíòåéíåð 30Â
|
|||
30B cylinder gross weight (full), kg
Âåñ áðóòòî (çàïîëíåííûé), êã
|
|
|||
30B cylinder tare weight (empty), kg
Âåñ òàðû (ïóñòîé) , êã
|
|
|||
EUP net weight, kg (N)
Âåñ íåòòî,êã
|
|
|||
Weight of U contained in EUP, kg (M)
Âåñ ñîäåðæàùåãîñÿ óðàíà, êã
|
|
|||
M = N* F * A/100
|
|
Isotopic composition
Èçîòîïíûé ñîñòàâ
|
ASTM C 996
specification value
Òðåáîâàíèÿ ñïåöèôèêàöèè
ASTM C 996
|
Analyzed value
Âåëè÷èíà ïî àíàëèçó
|
U-235
|
|
|
U-232
|
|
|
U-234
|
|
|
U-236
|
|
|
Uranium Hexafluoride Content (A)
Ñîäåðæàíèå ãåêñàôòîðèäà óðàíà
|
|
|
Vapor pressure in the filled 30B container
Äàâëåíèå ïàðîâ â êîíòåéíåðå, çàïîëíåííîì UF6
|
|
|
Impurity elements /
Ýëåìåíòû ïðèìåñè
|
|
|
Boron
|
|
|
Silicon
|
|
|
Technetium-99
|
|
|
Total content of hydrocarbon, chlorocarbon
and partially substituted halohydro-carbon
Ñóììàðíîå ñîäåðæàíèå óãëåâîäîðîäîâ, õëîðóãëåâîäîðîäîâ è ÷àñòè÷íî çàìåùåííûõ ãàëîèäîóãëåâîäîðîäîâ
|
|
|
G1-2
|
Delivery Receipt Format for Delivery of Enriched Product
|
G1-5
|
Delivery Receipt Format for Delivery of Empty Sample Containers type P-10 in drums
|
BUYER
ÏÎÊÓÏÀÒÅËÜ
|
Document 2.4.
Äîêóìåíò 2.4.
Delivery Receipt
Êâèòàíöèÿ ïîëó÷åíèÿ
Empty Sample Containers type P-10 in drums
Ïóñòûå Ïðîáîîòáîðíèêè òèïà Ð-10 â áî÷îíêàõ
|
Contract
No. 08843672/110033-051D,
¹ EC-SC01-11-UE-03127
Êîíòðàêò
No. 08843672/110033-051D,
¹ EC-SC01-11-UE-03127
|
Consignor:
Ãðóçîîòïðàâèòåëü:
Consignee:
Ãðóçîïîëó÷àòåëü:
|
No.
|
Drum No.
Áî÷îíîê ¹
|
Sample Container No.
Ïðîáîîòáîðíèê ¹
|
|
No.
|
Drum No.
Áî÷îíîê ¹
|
Sample Container No.
Ïðîáîîòáîðíèê ¹
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
||
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
||
|
|
|
|
|
||
|
|
|
|
|
Point of Delivery:
Ïóíêò Ïîñòàâêè:
Date of Delivery:
Äàòà Ïîñòàâêè:
|
Signed on behalf of Seller:
Ïîäïèñàíî çà Ïðîäàâöà:
Signed on behalf of Buyer:
Ïîäïèñàíî çà Ïîêóïàòåëÿ:
|
Consignor:
Ãðóçîîòïðàâèòåëü:
Consignee:
Ãðóçîïîëó÷àòåëü:
|
No.
|
PSP No.
Çàùèòíûé ×åõîë ¹
|
30B cylinder No.
Êîíòåéíåð 30Â ¹
|
Remarks
Ïðèìå÷àíèÿ
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Point of Delivery:
Ïóíêò Ïîñòàâêè:
Date of Delivery:
Äàòà Ïîñòàâêè:
|
Signed on behalf of Seller:
Ïîäïèñàíî çà Ïðîäàâöà:
Signed on behalf of Buyer:
Ïîäïèñàíî çà Ïîêóïàòåëÿ:
|
1.
|
The DOE Award Administrator/Contracting Officer identified in Article 4.01 is revised as follows:
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2.
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The DOE Program Manager identified in Article 4.02 is revised as follows:
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3.
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All other terms and conditions of the Agreement remain the same.
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1.
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Line 9 of the Opening Page is deleted in its entirety and replaced with the following:
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2.
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Line 10 of the Opening Page is deleted in its entirety and replaced with the following:
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3.
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Line 11 of the Opening Page is deleted in its entirety and replaced with the following:
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4.
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Section 8.01 of the Agreement is deleted in its entirety and replaced with the following:
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Award Period
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DOE Method of Cost Share
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Maximum DOE Incremental Amount of Cost Share Dollars
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Budget Period 1 Funding Period 1 6/1/12-7/31/12
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DOE assumption of 11,813 MT of DUF6 liability -
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$26,410,272
(in the form of DUF6 liability assumed by DOE)
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Budget Period 1 Funding Period 2 8/1/12-11/30/12
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DOE assumption of up to 27,387 MT of DUF6 liability
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$61,259,912
(in the form of DUF6 liability assumed by DOE)
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Total for Budget Period 1
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DOE assumption of up to 39,200 MT of DUF6 liability
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$87,670,184
(in the form of DUF6 liability assumed by DOE)
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Budget Period 2
Funding Period 1
12/1/12-3/12/13
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Appropriated Funding
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$45,720,000
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Budget Period 2
Funding Period 2
3/13/13-6/15/13
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DOE transfer to USEC Inc. of ***** KgU EUP containing ***** SWU as the SWU Component and approximately 408,833.614 KgU as the Feed Component with Recipient to return approximately 408,833.614 KgU Feed Component to DOE as set forth in Attachment H.
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$44,378,055 (agreed value of ***** SWU transferred as a component of the EUP transferred to USEC Inc.)
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Budget Period 2
Funding Period 3
6/16/13-7/31/13 Estimated Government Cost Share
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Appropriated Funding
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$20,000,000
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Budget Period 2
Funding Period 4
8/1/13-9/30/13 Estimated Government Cost Share
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To be determined by DOE based upon the availability of appropriations or other sources of consideration
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TBD
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Budget Period 2
Funding Period 5
10/1/13-12/31/13 Estimated Government Cost Share
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To be determined by DOE based upon the availability of appropriations or other sources of consideration
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TBD
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Total Estimated Government Cost Share for Budget Period 2
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$192,329,816
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5.
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In accordance with Section 8.01 of the Agreement, the Recipient is authorized to expend unutilized funds from the previous Funding Period during Funding Period 3.
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6.
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All other terms and conditions of the Agreement remain the same.
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/s/ Karen S. Shears
Karen S. Shears
Contracting Officer
U.S. Department of Energy
6/13/13
Date
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/s/ Philip G. Sewell
Philip G. Sewell
Senior Vice President
USEC Inc.
6-12-13
Date
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Annual Cash Retainer
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Annual cash retainer of $80,000 paid in four installments on or after May 1, 2013, August 1, 2013, November 1, 2013 and February 1, 2014 (the “Installment Dates”). A director may elect to receive the retainer in restricted stock units in lieu of cash. Restricted stock units would be granted at the time of the annual grant of restricted stock units at the closing price of USU on the date that is seven days after the 2013 annual meeting of stockholders.
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Annual Restricted
Stock Unit Grant
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Annual grant of 25,000 restricted stock units. Restricted stock units are granted on the date that is seven days after the 2013 annual meeting of stockholders and vest one year from the date of grant. However, vesting is accelerated upon (1) the director attaining eligibility for Retirement, (2) termination of the director's service by reason of death or disability, or (3) a change in control.
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Chairman Fees
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$100,000 annual fee for Chairman. $20,000 annual fee for Audit and Finance Committee chairman. $10,000 annual fee for Compensation Committee chairman. $7,500 annual fee for all other committees' chairman. Chairman fees are paid in cash in four installments on the Installment Dates, although a director may elect to receive their chairman fee in restricted stock units, which would be granted at the time of the annual grant of restricted stock units.
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Incentive Restricted Stock Unit Awards
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If a director chooses to receive restricted stock units as payment for fees that they are otherwise entitled to receive in cash, he or she will receive an incentive payment of restricted stock units equal to 20% of the portion of the annual retainer and chairman fees that the director elects to take in restricted stock units in lieu of cash. These incentive restricted stock units will vest in equal annual installments over three years from the date of grant, however, vesting is accelerated upon (1) the director attaining eligibility for Retirement, (2) termination of the director's service by reason of death or disability, or (3) a change in control. Incentive restricted stock units would be granted at the time of the annual grant of restricted stock units at the closing price of USU on the date that is seven days after the 2013 annual meeting of stockholders.
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1.
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I have reviewed this quarterly report on Form 10-Q of USEC Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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August 6, 2013
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/s/ John K. Welch
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John K. Welch
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President and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of USEC Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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August 6, 2013
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/s/ John C. Barpoulis
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John C. Barpoulis
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Senior Vice President and Chief Financial Officer
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August 6, 2013
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/s/ John K. Welch
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John K. Welch
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President and Chief Executive Officer
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August 6, 2013
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/s/ John C. Barpoulis
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John C. Barpoulis
|
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Senior Vice President and Chief Financial Officer
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