[Federal Register Volume 90, Number 118 (Monday, June 23, 2025)]
[Notices]
[Pages 26623-26625]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-11486]
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NUCLEAR REGULATORY COMMISSION
[Docket Nos. 40-3392, 11005938, 11006336, 11005360, and 11006183; NRC-
2025-0065]
In the Matter of Honeywell International, Inc.; Direct and
Indirect Transfers of License
AGENCY: Nuclear Regulatory Commission.
ACTION: Order; issuance.
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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) is issuing an
order approving the application filed by Honeywell International, Inc.
(Honeywell), dated January 24, 2025, as supplemented by letters dated
February 14, 2025, March 3, 2025, March 7, 2025, April 9, 2025, and May
28, 2025. Specifically, the order approves the direct, and subsequent
indirect, transfer of control of Source Material License No. SUB-526
and Export License Nos. XSOU8826/01 and XSOU8851/02 for the Honeywell
Metropolis Works (MTW) uranium conversion facility in Metropolis,
Illinois, and the indirect transfer of control of Honeywell's economic
interest in ConverDyn, GP (ConverDyn) which holds NRC Export License
Nos. XSOU8789/08 and XSOU8837.
DATES: The order was issued on June 17, 2025, and is effective
immediately.
ADDRESSES: Please refer to Docket ID NRC-2025-0065 when contacting the
NRC about the availability of information regarding this document. You
may obtain publicly available information related to this document
using any of the following methods:
Federal Rulemaking Website: Go to https://www.regulations.gov and search for Docket ID NRC-2025-0065. Address
questions about Docket IDs in Regulations.gov to Bridget Curran;
telephone: 301-415-1003; email: [email protected]. For technical
questions, contact the individual listed in the For Further Information
Contact section of this document.
NRC's Agencywide Documents Access and Management System
(ADAMS): You may obtain publicly available documents online in the
ADAMS Public Documents collection at https://www.nrc.gov/reading-rm/adams.html. To begin the search, select ``Begin Web-based ADAMS
Search.'' For problems with ADAMS, please contact the NRC's Public
Document Room (PDR) reference staff at 1-800-397-4209, at 301-415-4737,
or by email to [email protected]. The order and the NRC staff safety
evaluation supporting the order are available in ADAMS under Package
Accession No. ML25141A093.
NRC's PDR: The PDR, where you may examine and order copies
of publicly available documents, is open by appointment. To make an
appointment to visit the PDR, please send an email to
[email protected] or call 1-800-397-4209 or 301-415-4737, between 8
a.m. and 4 p.m. eastern time (ET), Monday through Friday, except
Federal holidays.
FOR FURTHER INFORMATION CONTACT: Osiris Siurano-P[eacute]rez, Office of
Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory
Commission, Washington, DC 20555-0001; telephone: 301-415-7827; email:
[email protected].
SUPPLEMENTARY INFORMATION: The text of the order is attached.
Dated: June 18, 2025.
For the Nuclear Regulatory Commission.
Samantha Lav,
Chief, Fuel Facility Licensing Branch, Division of Fuel Management,
Office of Nuclear Material Safety and Safeguards.
Attachment--Order Approving the Indirect Transfers of Control of
License
United States of America
Nuclear Regulatory Commission
In the Matter of Honeywell International, Inc., ConverDyn, GP,
EAF-NMSS-2025-0127
Docket Nos.: 40-3392, 11005938, 11006336, 11005360, and 11006183
License Nos.: SUB-526, XSOU8826/01, XSOU8851/02, XSOU8789/08,
and 11006183
[[Page 26624]]
Order Approving the Indirect Transfers of Control of Licenses
I.
Honeywell International Inc. (Honeywell), a publicly traded
company listed on the NASDAQ stock exchange (HON), is the owner and
licensee of the Metropolis Works Uranium Conversion Facility
(``Metropolis Facility'') near Metropolis, Illinois. In addition,
Honeywell, through its wholly owned subsidiary Honeywell Energy
Services, Inc. (``HES''), holds a 50 percent ownership interest in
ConverDyn, GP (ConverDyn) a joint venture between Honeywell and
General Atomics. Currently, Honeywell is the holder of Title 10 of
the Code of Federal Regulations (10 CFR) Part 40, ``Domestic
Licensing of Source Material,'' source and byproduct materials
license number SUB-526 and Export License numbers XSOU8826/01 and
XSOU8851/02. ConverDyn, GP (``ConverDyn''), is the holder of U.S.
Nuclear Regulatory Commission (NRC, the Commission) export license
numbers XSOU8789/08 and XSOU8837.
II.
By letter dated January 24, 2025 (Agencywide Documents Access
and Management System (ADAMS) Accession Number ML25024A105), as
supplemented by letters dated February 14, 2025 (ML25049A139), March
3, 2025 (ML25062A232), March 7, 2025 (ML25066A215), April 9, 2025
(ML25100A077), and May 28, 2025 (ML25148A428), Honeywell submitted
an application requesting that the NRC consent to the direct and
indirect transfer of control of the materials license and the export
licenses held by Honeywell and the indirect transfer of control of
Honeywell's economic interest in ConverDyn. In the submittal,
Honeywell stated that the application and consent were necessitated
by a proposed transaction to implement Honeywell's publicly
announced plan to spin off its advanced materials business
(including the Metropolis Facility and Honeywell's interest in the
ConverDyn joint venture) to existing Honeywell shareholders.
Honeywell stated that, to effectuate the announced spinoff, it will
create two new subsidiaries. Because the name of one subsidiary is
not yet known, it is referred to in the Application as ``NewCo
Corp.'' The other subsidiary has been formed and is currently named
US Athens SpinCo LLC, though its name may be changed prior to the
completion of the Spin (as defined below). NewCo Corp. will be a
direct subsidiary of US Athens SpinCo LLC.
The proposed transaction will then occur in two steps. The first
step involves both a direct and two indirect transfers of control.
In the first step, (i) the direct transfer of control will occur
when Honeywell, the current licensee of the Metropolis Facility and
holder of the 100 percent ownership of the facility's interests,
transfers its materials and Export licenses for the facility (and
ownership of the relevant assets and operations related to it) to
NewCo Corp., and NewCo Corp. will become the new licensee, (ii) an
indirect transfer of control will occur when Honeywell transfers
ownership of HES to NewCo Corp., which will occur substantially
concurrently with the direct transfer of control of the license for
the Metropolis Facility described in clause (i), and (iii) an
indirect transfer of control will occur when Honeywell transfers
ownership of NewCo Corp. to US Athens SpinCo LLC. As a result of the
first indirect transfer, NewCo Corp. will become an indirect
intermediate corporate parent of Honeywell's indirect 50 percent
ownership interest in the ConverDyn joint venture. As a result of
clause (iii) of this first step, US Athens SpinCo LLC will be (1)
the direct intermediate corporate parent of NewCo Corp. and (2) the
indirect intermediate corporate parent of HES, which holds the 50
percent ownership interest in the ConverDyn joint venture. The first
step (including the direct and indirect transfers of control
resulting therefrom) is referred to as the ``Internal
Reorganization.'' For the sake of clarity, before and after the
first step, US Athens SpinCo LLC will be wholly owned by Honeywell.
The second step (the ``Spin'') (together, with the Internal
Reorganization, the ``Transaction'') involves an indirect transfer
of control. After US Athens SpinCo LLC converts to a corporation
(``US Athens SpinCo Corp.''), Honeywell will distribute shares in US
Athens SpinCo Corp. to Honeywell's existing common shareholders on a
pro rata basis according to their ownership of Honeywell's common
stock at such time. As a result of the Spin, US Athens SpinCo Corp.
will become the new ultimate parent company for NewCo Corp. and HES,
and the ultimate corporate owner of 50 percent of the ConverDyn
joint venture. Because the Internal Reorganization and the Spin are
both required to effectuate the Transaction, and the Spin would not
occur without the Internal Reorganization, Honeywell is submitting a
single Application and requests that the NRC grant its consent to
each of the two steps of the Transaction. More information on the
proposed transaction is provided in the enclosed Application.
The current corporate organizational structure of Honeywell, as
it relates to the licensed entities that are the subject of this
Application before the Transaction, is depicted in an organization
chart provided in Exhibit F-1 of Revision 2 (ML25149A078) of
Honeywell's Application. Exhibit F-2 of Revision 2 of Honeywell's
Application provides an organization chart showing the structure
relating to the licensed entities after the Internal Reorganization.
Exhibit F-3 of Revision 2 of Honeywell's Application provides an
organization chart showing the structure relating to the licensed
entities after the Spin and completion of the Transaction.
As part of the Internal Reorganization described above,
Honeywell will transfer the materials and export licenses for the
Metropolis Facility to NewCo Corp. The principal officers and
members of the NewCo Corp. board of directors will all be U.S.
citizens. Also, as part of the Internal Reorganization, Honeywell
will insert US Athens SpinCo LLC into the corporate ownership chain
as an intermediate holding company and direct intermediate corporate
parent of NewCo Corp. and indirect intermediate corporate parent of
Honeywell's 50 percent ownership of the ConverDyn joint venture. At
this step, US Athens SpinCo LLC will be wholly owned by Honeywell.
US Athens SpinCo LLC is managed by two managers. Prior to the Spin,
US Athens SpinCo LLC will be converted into a Delaware corporation
and, thereafter, Honeywell will distribute its shares in US Athens
SpinCo Corp. to Honeywell's existing common shareholders on a pro
rata basis according to their ownership of Honeywell's common stock
at such time (thus, the ultimate beneficial ownership of the
Metropolis Facility and indirect 50% ownership interest in the
ConverDyn joint venture will be unchanged relative to that
immediately prior to the second step). Once a corporation, US Athens
SpinCo Corp. will be managed by a board of directors. The principal
officers of US Athens SpinCo Corp. and members of the board of
directors have yet to be identified, but Honeywell expects a
majority will be U.S. citizens. The size of the board of directors,
and the names and citizenship of expected officers and directors
will be provided to the NRC when they become available.
For significant corporate business purposes, Honeywell seeks to
affect the Internal Reorganization by the end of the second quarter
of 2025 and the Spin by the third quarter of 2025. Honeywell would
not undertake the Internal Reorganization but for the planned Spin,
and Honeywell therefore requests consent to both the Internal
Reorganization and the Spin in this Application. Honeywell's request
for consent to both the Internal Reorganization and the Spin is
consistent with other requests for NRC consent to single
transactions involving multiple steps.
There are no anticipated changes in the operations, key
operating personnel or management having direct operational
responsibility for, and control of, licensed activities resulting
from the Transaction. Honeywell will transfer all employees
responsible for licensed materials and activities at the Metropolis
Facility to NewCo Corp. as part of the Internal Reorganization, and
those employees will remain responsible for such materials and
activities after the closing of the Transaction. Accordingly, NewCo
Corp. will remain technically qualified to hold the Metropolis
Facility license and will fulfill all responsibilities as the
licensee. There are no changes anticipated in the location of the
regulated activities, or operational organization, location,
facilities, equipment, or procedures related to the Metropolis
Facility license, because of the Transaction. Similarly, there are
no anticipated changes at ConverDyn as a result of the transfer of
Honeywell's indirect 50 percent ownership of the ConverDyn joint
venture. Honeywell will notify the NRC if changes become anticipated
as part of the Transaction.
NewCo Corp. will be financially qualified to engage in NRC-
licensed activities. Honeywell currently relies on a standby trust
and irrevocable standby letters of credit to demonstrate
decommissioning funding assurance for the Metropolis Facility. Prior
to
[[Page 26625]]
closing, and upon approval of the transfers of control, US Athens
SpinCo Corp. will replace the standby trust. Honeywell will either
transfer the irrevocable letters of credit to US Athens SpinCo Corp.
or US Athens SpinCo Corp. will replace the letters of credit with a
new financial assurance instrument; that instrument is likely to
take the form of a surety bond, insurance, bank or third-party
lender guarantee, or new letters of credit. Honeywell or US Athens
SpinCo Corp. will submit the actual form of any replacement
financial assurance instrument to the NRC in a supplemental filing.
This replacement financial assurance instrument will be in an amount
sufficient to satisfy the most recent decommissioning cost estimate.
The Transaction is not anticipated to affect the organizational
or operational structure described in the license for the Metropolis
Facility nor any procedures associated with the licensed activities
that would require NRC approval. Further, there are no anticipated
changes in the use, possession, locations, or storage of licensed
materials at the Metropolis Facility because of the Transaction.
Licensed activities will continue in their current form without
interruption resulting from the Transaction. Similarly, the transfer
of Honeywell's indirect 50 percent ownership of the ConverDyn joint
venture as part of the Transaction is not anticipated to have any
effect on the export license held by ConverDyn or any of ConverDyn's
licensed activities. Honeywell will inform the NRC if changes become
anticipated as part of the Transaction.
Honeywell currently anticipates that the Internal Reorganization
will close in the second quarter of 2025 and the Spin by the third
quarter of 2025. In its Application, Honeywell requested the NRC to
provide its consent by no later than June 24, 2025, and that such
consent be effective for one year subject to extension for good
cause shown.
The applicants requested the NRC's consent to the indirect
transfers of control pursuant to Section 184 of the Atomic Energy
Act of 1954, as amended, and the NRC's implementing regulations in
10 CFR 40.46, 110.50, and 110.51. A notice of receipt of the
application and opportunity to request a hearing and provide written
comments was published in the Federal Register on April 1, 2025 (90
FR 14396). The NRC received one comment (ML25098A039) on the
Application and no requests for a hearing in response to the notice.
In its comment, the commenter recommended ``. . .not approving the
transfer because the American taxpayer could be affected and have to
pay for an expensive decommissioning of radioactive industries.''
The commenter, however, provided no additional justification for the
NRC to deny its consent to transfer control of Honeywell's licenses.
As such, the NRC took no action in response to the comment.
The regulation in 10 CFR 40.46, ``Inalienability of licenses,''
states that ``No license issued or granted pursuant to the
regulations in this part shall be transferred, assigned or in any
manner disposed of, either voluntarily or involuntarily, directly or
indirectly, through transfer of control of any license to any
person, unless the Commission shall after securing full information,
find that the transfer is in accordance with the provisions of this
act, and shall give its consent in writing.'' The regulation in 10
CFR 110.50(d) states that ``A specific license may be transferred,
disposed of or assigned to another person only with the approval of
the Commission''.
Upon review of the information in Honeywell's application, as
supplemented, and other information before the NRC, and relying on
the representations contained in the application, the NRC staff has
determined that NewCo Corp. is qualified to directly hold the NRC
license for the Metropolis facility, to the extent described in the
application, and that the indirect transfers of the licenses, as
described by Honeywell in its Application, are otherwise consistent
with applicable provisions of law, regulations, and orders issued by
the Commission pursuant thereto.
The NRC staff has also determined that: (1) there is reasonable
assurance that the health and safety of the public will not be
endangered by operation in the proposed manner, (2) there is
reasonable assurance that such activities will be conducted in
compliance with the Commission's regulations, and (3) the transfers
will not be inimical to the common defense and security or to the
health and safety of the public. The findings set forth above are
supported by an NRC staff technical evaluation dated the same date
as this order, which is available at ADAMS Accession No.
ML25141A095.
III.
Accordingly, pursuant to Sections 161b, 161i, and 184 of the
Act, 42 U.S.C. Sec. Sec. 2201(b), 2201(i), and 2234; and 10 CFR
40.46 and 110.50(d), IT IS HEREBY ORDERED that the license transfer
application, as described herein, be approved subject to the
following conditions:
(1) Honeywell must certify, at least 10 days prior to closing
the Transaction, that a majority of corporate officers and board of
directors remain U.S. Citizens.
(2) Honeywell must provide, at least 10 business days prior to
closing, executed financial assurance instruments in the name of the
new licensee which will cover the most recently approved
decommissioning cost estimate.
(3) Honeywell must provide, at least 10 business days prior to
closing, an executed letter from NewCo Corp. confirming that it
agrees to the direct and indirect transfer of control within the
meaning of 10 CFR 40.46.
(4) Honeywell shall provide, at least 10 business days prior to
the closure of the transaction, Certificates of Incorporation in the
name of the new licensee.
(5) Should the proposed indirect transfers not be completed
within 1 year of the date of the Order, the Order shall become null
and void provided that, upon timely written application and for good
cause shown, such date may be extended by order.
(6) After receipt of all required regulatory approvals of the
proposed transaction, Honeywell shall inform the Director of the
Office of Nuclear Material Safety and Safeguards in writing of such
receipt at least one (1) business day before all actions necessary
to accomplish the direct and indirect transfers of control are
completed.
(7) Should the proposed indirect transfers not be completed
within 1 year of the date of this order, this order shall become
null and void, provided, however, that upon timely written
application and for good cause shown, such date may be extended by
order.
This order is effective upon issuance.
For further details with respect to this order, see the
application dated January 24, 2025, as supplemented by letters dated
February 14, 2025 (ML25049A139), March 3, 2025 (ML25062A232), March
7, 2025 (ML25066A215), April 9, 2025 (ML25100A077), and May 28, 2025
(ML25148A428), and the associated NRC staff technical evaluation
dated the same date as this order. Publicly available documents
created or received at the NRC are accessible electronically through
ADAMS in the NRC Library at https://www.nrc.gov/reading-rm/adams.html. Persons who do not have access to ADAMS or who encounter
problems in accessing the documents located in ADAMS should contact
the NRC Public Document Room (PDR) reference staff by telephone at
1-800-397-4209 or 301-415-4737 or by email to [email protected].
Dated: June 17, 2025.
FOR THE NUCLEAR REGULATORY COMMISSION.
/RA/
John W. Lubinski, Director,
Office of Nuclear Material Safety and Safeguards.
[FR Doc. 2025-11486 Filed 6-20-25; 8:45 am]
BILLING CODE 7590-01-P