Centrus Energy Corp.
11/18/2024 | Press release | Distributed by Public on 11/18/2024 16:03
Material Event Form 8 K
Item 8.01 Other Events
Pursuant to a 2011 contract between Centrus Energy Corp. and TENEX, Joint Stock Company, a Russian government-owned entity ("TENEX"), TENEX serves as Centrus' largest supplier of low enriched uranium ("LEU") for delivery to Centrus' U.S. and international customers.
On November 18, 2024, Centrus received notice from TENEX that on November 14, 2024 the government of the Russian Federation passed a decree, effective through December 31, 2025, that rescinded TENEX's general license to export LEU to the United States or to entities registered in the United States. Accordingly, TENEX is required to obtain a specific export license from the Russian authorities in order for it to make each of the remaining 2024 shipments of LEU to Centrus and for shipments to Centrus in 2025.
TENEX has informed Centrus of its plan to seek the necessary export licenses, in a timely manner, to allow it to meet its delivery obligations for the pending Centrus orders. However, Centrus has been informed that there is no certainty whether such licenses will be issued by the Russian authorities and if issued, whether they will be issued in a timely manner.
Centrus will be in communication with its customers whose pending orders may be affected and is assessing actions to mitigate adverse impacts. If TENEX is unable to secure export licenses for our pending or future orders, it would affect our ability to meet our delivery obligations to our customers and would have a material adverse effect on our business, results of operations, and competitive position.
Forward-Looking Statements
Certain matters contained in this Current Report on Form 8-K concerning expected future events and financial results constitute forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are based upon management's expectations and beliefs concerning such future events impacting the Company. There can be no assurance that these future events will occur as anticipated or that the effect on the Company's results will be as estimated. Forward-looking statements speak only as of the date they were made, and the Company undertakes no obligation to publicly update them. For a description of certain factors that could cause the Company's future results to differ from those expressed in any such forward-looking statements, see the risk factors that are included in the Company's reports filed with the Securities and Exchange Commission, including those described under "Risk Factors" in its annual report on Form 10-K for the year ended December 31, 2023. On November 5, 2024, the United States Department of Energy and American Centrifuge Operating, LLC, a Delaware limited liability company and a wholly subsidiary of Centrus Energy Corp. ("Centrus") executed an amendment to the High-Assay, Low-Enriched Uranium ("HALEU") Demonstration Cascade Completion and HALEU Production contract (the "Contract"), dated November 30, 2022, to extend the period of performance for the second phase ("Phase 2") of the Contract, which was to expire on November 6, 2024, to June 30, 2025 and separately to add approximately $24 million of incremental funding.
The foregoing description of the Contract amendment is a summary only and does not purport to be complete, and is qualified in its entirety by reference to the full text of the amendment, a copy of which will be filed as an exhibit to the Company's next Annual Report on Form 10-K filed with the Securities and Exchange Commission.