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EXHIBIT 10.19
MEMORANDUM OF AGREEMENT
BETWEEN THE UNITED STATES DEPARTMENT OF ENERGY
AND THE UNITED STATES ENRICHMENT CORPORATION
RELATING TO DEPLETED URANIUM
GENERATED PRIOR TO THE PRIVATIZATION DATE
THIS MEMORANDUM OF AGREEMENT is entered into as of the 18 day of
May, 1998, by and between the UNITED STATES DEPARTMENT OF ENERGY ("DOE") and
the UNITED STATES ENRICHMENT CORPORATION ("USEC" or the "Corporation").
WHEREAS, the USEC Privatization Act provides, in Section 3109(a)(3),
that "[a]ll liabilities arising out of the disposal of depleted uranium
generated by the corporation between July 1, 1993, and the privatization date
shall become the direct liabilities of the Secretary [of Energy]" and in order
to fulfill the requirements of Section 3109(a)(3) of the USEC Privatization Act
in a manner that is consistent with the purposes of the Energy Policy Act and of
the USEC Privatization Act, DOE and USEC have entered into this Memorandum of
Agreement;
NOW, THEREFORE, under the authority of the USEC Privatization Act,
the Energy Policy Act, the Atomic Energy Act and other law, DOE and USEC hereby
agree as follows:
ARTICLE 1 DEFINITIONS
The following terms when capitalized and used in this Agreement shall have the
meanings indicated below.
"Energy Policy Act" means the Energy Policy Act of 1992, Title IX of Public Law
102-486.
"Gaseous Diffusion Plants" or "GDP's" means the gaseous diffusion plants at
Paducah, Kentucky and Portsmouth, Ohio owned by DOE, portions of which are
leased to USEC.
"Lease Agreement" means the Lease Agreement Between the United States
Department of Energy and the United States Enrichment Corporation, dated
July l, 1993, as amended.
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"Pre-privatization Period" means the period beginning on July l, 1993, and
ending on the Privatization Date.
"Privatization Date" means the date on which 100 percent of the ownership of the
Corporation has been transferred to private investors pursuant to the USEC
Privatization Act.
"Secretary" means the Secretary of Energy.
"USEC Privatization Act" means Title III of Public Law 104-134.
ARTICLE 2 DEPLETED URANIUM
Nothing in this Agreement shall be construed as transferring or
limiting the liability of the Secretary for disposal of depleted uranium as set
forth in Section 3109(a)(3) of the USEC Privatization Act. Subject to Article 3,
the parties to this Agreement agree to implement Section 3109(a)(3) of the USEC
Privatization Act as follows:
(i) Title to depleted uranium generated by USEC during the
Pre-privatization Period shall be transferred to DOE on the Privatization Date.
(ii) Within 14 days of the Privatization Date, USEC shall provide
DOE a listing by cylinder number of the cylinders of depleted uranium generated
by USEC during the Pre-privatization Period.
(iii) USEC shall be responsible for all costs associated with the
storage of the depleted uranium until title is transferred to DOE as specified
in this section. On or before the Privatization Date, USEC shall pay to DOE $16
million in complete satisfaction of USEC's obligation for any and all costs
associated with the storage of the depleted uranium following the transfer of
the depleted uranium to DOE.
(iv) The Secretary shall be responsible for all costs associated
with disposal of the depleted uranium generated by USEC during the
Pre-privatization Period, including any treatment or conversion required by law
or regulatory authority associated with such disposal.
(v) Upon transfer of title to DOE, USEC, at USEC's option, shall:
(1) permit DOE to continue to store the depleted uranium in the portions of the
GDP's
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leased to USEC where the cylinders are located as of the date title is
transferred (and continue to use the cylinder saddles); or (2) delease the area
pursuant to Section 3.4 of the Lease Agreement (and transfer title to the
cylinder saddles to DOE) where the cylinders are stored. Also upon transfer of
title to DOE, USEC shall provide copies of all USEC records associated with
inspection, storage, and management of the depleted uranium and the cylinders,
including, but not limited to, all manufacturers' records in its possession and
the "Change Cylinder Check Sheet (Form A-3931)" for each cylinder.
(vi) USEC and DOE shall consult and coordinate concerning the
management and disposition of this depleted uranium and shall actively pursue
the beneficial use of this depleted uranium. Pursuant to the Anti-Deficiency
Act, DOE's commitment under this subsection (vi) is subject to the availability
of appropriated funds.
ARTICLE 3 EXPIRATION OF AGREEMENT
In the event that the Privatization Date does not occur by June 30,
1999, this Agreement shall be terminated and all of its terms shall be null and
void.
IN WITNESS WHEREOF, DOE and USEC have caused this Agreement to be executed and
delivered as of the date first above written and hereby affix the signatures of
their duly authorized representatives:
US DEPARTMENT OF ENERGY UNITED STATES ENRICHMENT CORP.
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxxxx, Xx.
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Xxxxxxx X. Xxxxxx Xxxxx X. Xxxxxxx, Xx.
Chief Financial Officer Vice President and Chief
Financial Officer
Date: 5/15/98 Date: 5/18/98
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