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LIGHTBRIDGE Corp

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What changed in LIGHTBRIDGE Corp's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of LIGHTBRIDGE Corp's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+257 added−265 removedSource: 10-K (2024-03-04) vs 10-K (2023-03-30)

Top changes in LIGHTBRIDGE Corp's 2023 10-K

257 paragraphs added · 265 removed · 175 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

71 edited+22 added−26 removed45 unchanged
Biggest changeAs a result, our fuel development timelines are 15-20 years before we expect to secure our first orders for fuel batch reloads in large commercial PWRs, unless we can access significantly increased test loop capacity. Consequently, the projected fuel development costs make it unfeasible for Lightbridge to fund this fuel development effort on its own. 3.
Biggest changeThis would likely necessitate additional loop irradiation testing in another test reactor or LTR demonstration in a large commercial PWR in addition to the ATR loop testing before LTA demonstration could commence. As a result, our fuel development timelines are 15-20 years before we expect to secure our first orders for fuel batch reloads in large commercial PWRs.
We anticipate that subsequent phases of work under the two umbrella agreements that have not yet been released may include post-irradiation examination of the irradiated fuel material coupons, loop irradiation testing in the ATR, and post-irradiation examination of one or more uranium-zirconium fuel rodlets, as well as transient experiments in the Transient Reactor Test Facility (TREAT) at INL.
We anticipate that subsequent phases of work under the two umbrella agreements that have not yet been released may include post-irradiation examination of the irradiated fuel material coupons, loop irradiation testing in the ATR, and post-irradiation examination of one or more uranium-zirconium fuel rodlets, as well as transient experiments in the Transient Reactor Test Facility at INL.
For utilities or countries that already have operating reactors, we expect that our nuclear fuel could be utilized to both increase the power output of those reactors as well as enable them to load follow with electric grid demands, which have become increasingly variable with large additions of intermittent renewable generation.
For utilities or countries that already have operating reactors, we expect that our nuclear fuel could be utilized to both increase the power output of those reactors as well as enable them to load follow with electric grid demands, which demands have become increasingly variable with large additions of intermittent renewable energy generation.
Need to develop and demonstrate a qualified fabrication process for our metallic fuel rods Demonstration of a qualified fabrication process both for semi-scale irradiation fuel rod samples and subsequently for full-length (12-14 feet) metallic fuel rods for large PWR LTAs and shorter length for SMRs (~6 feet) is required.
Need to develop and demonstrate a qualified fabrication process for our metallic fuel rods Demonstration of a qualified fabrication process both for semi-scale irradiation fuel rod samples and subsequently for full-length (approximately 12 to 14 feet) metallic fuel rods for large PWR LTAs and shorter length for SMRs (approximately 6 feet) is required.
Over the past year, many ATF vendors concluded that the unexpectedly small accident tolerance benefits their ATF fuel concepts offered (such as several extra hours of coping time during severe accidents rather than their original goal of approximately 72 hours) were not enough of an incentive for nuclear utilities to adopt ATF designs, which would cost more and have reduced the efficiency relative to conventional uranium dioxide fuels.
Over the past year, we believe many ATF vendors concluded that the unexpectedly small accident tolerance benefits their ATF fuel concepts offered (such as several extra hours of coping time during severe accidents rather than their original goal of approximately 72 hours) were not enough of an incentive for nuclear utilities to adopt ATF designs, which would cost more and have reduced the efficiency relative to conventional uranium dioxide fuels.
Burnup is the total amount of electricity generated per unit mass of nuclear fuel consumed and is a function of the power density of a nuclear fuel and the amount of time the fuel operates in the reactor. Power density is the amount of heat power generated per unit volume of nuclear fuel.
Burnup is the total amount of electricity generated per unit mass of nuclear fuel consumed and is a function of the power density of a nuclear fuel and the amount of time the fuel operates in the reactor. Power density is the amount of heat power generated per unit mass of nuclear fuel.
In the U.S., the nuclear fuel fabricator and the nuclear utility will be primarily responsible for securing the necessary regulatory licensing approvals for the LTA operation. We plan to also build relationships with SMR reactor and fuel vendors, as well as existing and/or potential SMR utility customers. 4.
In the U.S., the nuclear fuel fabricator and the nuclear utility will be primarily responsible for securing the necessary regulatory licensing approvals for the LTA operation. We plan to also build relationships with large reactor and/or SMR reactor fuel vendors, as well as existing nuclear utilities and/or potential SMR customers. 4.
According to the February 2019 Nuclear Energy Institute technical report on ATF titled “Safety and Economic Benefits of Accident Tolerant Fuel”, advanced fuel design concepts (such as ATF) were accelerated by combining recent operating experience with worldwide research and development.
According to the February 2019 Nuclear Energy Institute technical report on ATF titled “Safety and Economic Benefits of Accident Tolerant Fuel,” advanced fuel design concepts (such as ATF) were accelerated by combining recent operating experience with worldwide research and development.
According to the WNA, nuclear reactors produce no greenhouse gas emissions during operation, and over the course of their lifecycles, nuclear power plants produce about the same amount of CO2 equivalent emissions per unit of electricity as wind.
According to the WNA, nuclear reactors produce no greenhouse gas emissions during operation, and over the course of their lifecycles, produce about the same amount of CO2 equivalent emissions per unit of electricity generated as wind power.
Build-up of hydrogen gas in a nuclear power plant can lead to a hydrogen explosion, which contributed to the damage at the Fukushima Daiichi nuclear power plant. Lightbridge Fuel™ is designed to mitigate hydrogen gas generation in design-basis LOCA situations.
Build-up of hydrogen gas in a nuclear power plant can lead to a hydrogen explosion, which contributed to the damage at the Fukushima Daiichi nuclear power plant. Lightbridge Fuel™ is expected to mitigate hydrogen gas generation in design-basis LOCA situations.
We project that the world’s energy and climate needs can only be met if nuclear power’s share of the energy-generating mix grows substantially in the coming decades. We believe Lightbridge will benefit from a growing nuclear power industry, and we are developing our nuclear fuel to help enable that growth to happen.
We project that the world’s energy and climate needs can only be met if nuclear power’s share of the energy-generating mix grows substantially in the coming decades. We believe Lightbridge can benefit from a growing nuclear power industry, and that our nuclear fuel can help enable that growth to happen.
Past operating experience in icebreaker reactors with differently shaped fuel rods with a similar metallic fuel composition involved fabrication of metallic fuel rods up to 3 feet in length. Fabrication of full-length (approximately 12 to 14 feet) PWR metallic fuel rods for large PWRs has yet to be fully demonstrated.
Past operating experience in icebreaker reactors with differently shaped fuel rods with a similar metallic fuel composition involved fabrication of metallic fuel rods up to 3 feet in length. Fabrication of full-length PWR metallic fuel rods for large PWRs has yet to be fully demonstrated.
In addition to U.S. government funding, political support for our project is similarly important. The sales and marketing of our services and technology internationally may be subject to U.S. export control regulations, including 10 C.F.R. Part 810 and 10 C.F.R. Part 110, and the export control laws of other countries.
In addition to external funding and/or in-kind support, political support for our project is similarly important. The sales and marketing of our services and technology internationally may be subject to U.S. export control regulations, including 10 C.F.R. Part 810 and 10 C.F.R. Part 110 and the export control laws of other countries.
However, availability of irradiation test loops for fuel in the ATR has become limited and highly competitive, limiting how much nuclear fuel can be inserted into the reactor as well as its duration in the reactor.
Since the shutdown of the Halden reactor, availability of irradiation test loops for fuel in the ATR has become limited and highly competitive, limiting how much nuclear fuel can be inserted into the reactor as well as its duration in the reactor.
We expect that Lightbridge Fuel™ can provide SMRs with all the same benefits our technology brings to large reactors, with such benefits being even more meaningful to the economic case for deployment of SMRs, including potential load following capability when included on a low-carbon electric grid with renewable energy sources.
We expect that Lightbridge Fuel™ can provide water-cooled SMRs with the same benefits our technology brings to large reactors, with such benefits being even more meaningful to the economic case for deployment of SMRs, including potential load following capability when included on a virtually zero-carbon electric grid with renewable energy sources.
Human Capital Management As of December 31, 2022, we had five full-time employees and utilized a network of independent contractors, outside agencies and technical facilities with specific skills to assist with various business functions including, but not limited to, corporate, financial, personnel, research and development, and communications.
Human Capital Resources As of December 31, 2023, we had six full-time employees and utilized a network of independent contractors, outside agencies, and technical facilities with specific skills to assist with various business functions including, but not limited to, corporate, financial, personnel, research and development, and communications.
This recent shift in positioning by many ATF vendors represents a competitive threat to Lightbridge for use in existing large PWRs, as ATF vendors are now trying to encroach into a critical element of Lightbridge’s value proposition, i.e., the ability of Lightbridge Fuel™ to extend the cycle length from 18 to 24 months in existing large PWRs.
This recent shift in positioning by many ATF vendors represents a competitive threat to Lightbridge for use in existing large PWRs, as ATF vendors are now trying to encroach into a critical element of Lightbridge’s value proposition, i.e., the ability of Lightbridge Fuel™ to extend the cycle length from 18 to 24 months in existing large PWRs and/or offer power rate uprates opportunities.
Experimental data measured from our planned irradiation demonstrations will help to identify areas where new analytical models, or modifications to existing ones, may be required. 10 Table of Contents 7.
Experimental data measured from our planned irradiation demonstrations will help to identify areas where new analytical models, or modifications to existing ones, may be required. 7.
Conventional oxide fuel used in existing commercial reactors is nearing the limit of its design and licensed burnup and power density capability. As a result, further optimization is needed to (i) increase power output from the same core size to improve the economics, and (ii) enhance the safety of nuclear power generation where using conventional oxide fuel technologies is limited.
Conventional oxide fuel used in existing commercial reactors is nearing the limit of its design and licensed burnup and power density capability. As a result, further optimization is needed to (i) increase power output from the same core size to improve reactor economics, and (ii) enhance the fuel performance of nuclear power generation.
This is a major safety benefit. 7 Table of Contents Lightbridge Spent Fuel - Proliferation Resistance The April 2018 issue of Nuclear Engineering and Design, a technical journal affiliated with the European Nuclear Society, included a peer-reviewed article stating that after analyzing Lightbridge’s fuel, the authors concluded that any plutonium extracted from Lightbridge’s spent fuel would not be useable for weapon purposes.
Lightbridge Spent Fuel - Proliferation Resistance The April 2018 issue of Nuclear Engineering and Design, a technical journal affiliated with the European Nuclear Society, included a peer-reviewed article stating that after analyzing Lightbridge’s fuel, the authors concluded that any plutonium extracted from Lightbridge’s spent fuel would not be useable for weapon purposes.
That heat is then converted through steam into electricity that is delivered to the transmission and distribution grid. We have designed our innovative, proprietary metallic fuels to be capable of significantly higher burnup and power density compared to conventional oxide nuclear fuels.
The fuel in a nuclear reactor generates energy in the form of heat. That heat is then converted through steam into electricity that is delivered to the transmission and distribution grid. We have designed our innovative, proprietary metallic fuels to be capable of significantly higher burnup and power density compared to conventional oxide nuclear fuels.
Preliminary analytical modeling shows that under a design-basis LOCA scenario, unlike conventional uranium dioxide fuel, the cladding of the Lightbridge-designed metallic fuel rods would stay at least 200 degrees below the 850-900 degrees Celsius temperature at which steam begins to react with the zirconium cladding to generate hydrogen gas.
Preliminary analytical modeling shows that under a design-basis LOCA scenario in a VVER-1000 reactor, unlike conventional uranium dioxide fuel, the cladding of the Lightbridge-designed metallic fuel rods would stay approximately 200 degrees cooler than the 850-900 degrees Celsius temperature at which steam begins to react with the zirconium cladding to generate hydrogen gas.
According to the DOE, the purposes of the HALEU Consortium include: (i) Provide the Secretary of Energy HALEU demand estimates for domestic commercial use, (ii) Purchase HALEU made available to members for commercial use under the Program, (iii) Carry out demonstration projects using HALEU under the Program, and (iv) Identify actionable opportunities to improve the reliability of the HALEU supply chain.
According to the DOE, the purposes of the HALEU Consortium include: (i) providing the Secretary of Energy HALEU demand estimates for domestic commercial use, (ii) purchasing HALEU made available to members for commercial use under the program, (iii) carrying out demonstration projects using HALEU under the program, and (iv) identifying actionable opportunities to improve the reliability of the HALEU supply chain.
We believe our proprietary nuclear fuel designs have the potential to improve the nuclear power industry’s economics by: · enabling increased reactor power output via a power uprate (potentially up to a 30% increase) or a longer operating cycle without changing the core size in new build pressurized water reactors (PWRs), including SMRs; or · providing an increase in power output of potentially up to 10% while simultaneously extending the operating cycle length from 18 to 24 months in existing PWRs, including in Westinghouse-type four-loop PWR plants, which are currently constrained to an 18-month operating cycle by oxide fuel enriched up to 5% in the isotope uranium-235, or increasing the power potentially up to 17% while retaining an 18-month operating cycle.
We believe our proprietary nuclear fuel designs have the potential to improve the nuclear power industry’s economics by: · enabling increased reactor power output via a power uprate (potentially up to a 30% increase) or a longer operating cycle without changing the core size in new build pressurized water reactors (PWRs), including future SMRs; or · providing an increase in power output of potentially up to 10% while simultaneously extending the operating cycle length from 18 to 24 months in existing PWRs, including in Westinghouse-type four-loop PWR plants, which are currently constrained to an 18-month operating cycle by oxide fuel enriched up to 5% in the isotope uranium-235, or increasing the power potentially up to 17% while retaining an 18-month operating cycle. 5 Table of Contents We believe our fuel designs will allow current and new-build nuclear reactors to safely increase power production and reduce operations and maintenance costs on a per kilowatt-hour basis.
Supply chain infrastructure for HALEU Establishment of required supply chain infrastructure to support high-assay low-enriched uranium metallic fuel is a necessary step in the commercialization of our nuclear fuel.
Supply chain infrastructure for HALEU Establishment of required supply chain infrastructure to support HALEU metallic fuel is a necessary step in the commercialization of our nuclear fuel.
We believe that deep cuts to CO2 emissions are only possible with electrification of most of the transportation and industrial sectors globally and powering them, and the current electricity needs of the world, with non-emitting or low-emitting power or no-carbon liquid fuels.
We believe that deep cuts to CO2 emissions are only possible with electrification of most of the transportation and industrial sectors globally and powering such sectors, and other current global electricity needs, with non-emitting or low-emitting energy sources or no-carbon liquid fuels.
If they are successful in extending the cycle length to 24 months in a cost-effective way, this could give sufficient economic incentive for nuclear utilities to switch to the ATF designs in the coming years.
If they are successful in extending the cycle length and or achieving power uprates in a cost-effective way, this could give sufficient economic incentive for nuclear utilities to switch to the ATF designs in the coming years.
While it is not certain that the ATF vendors will be successful in this approach, if ATF could provide for two-year cycles, it could severely weaken or undermine our economic value proposition in existing large PWRs.
While it is not certain that the ATF vendors will be successful in this approach, if ATF could provide for longer cycles and/or power uprates, it could severely weaken or undermine our economic value proposition in existing large LWRs.
Anticipated Safety Benefits of Lightbridge Fuel™ The expected safety benefits of Lightbridge Fuel™ are as follows: · operates at lower operating temperatures than current conventional nuclear fuel, contributing to lower stored thermal energy in the fuel rods; it is therefore not expected to generate explosive hydrogen gas under design-basis accidents when there is a loss of coolant in the reactor; · enhances structural integrity of the nuclear fuel rods; and · has lighter and stiffer fuel assembly, which may contribute to improved seismic performance; Due to the significantly lower fuel operating temperature and higher thermal conductivity, our metallic nuclear fuel rods are expected to provide major improvements to safety margins during certain off-normal events.
Anticipated Safety Benefits of Lightbridge Fuel™ The anticipated safety benefits of Lightbridge Fuel™ are as follows: · Lightbridge Fuel™ operates at lower operating temperatures than current conventional nuclear fuel, contributing to lower stored thermal energy in the fuel rods; it is therefore not expected to generate explosive hydrogen gas under design-basis accidents when there is a loss of coolant in the reactor; · enhances structural integrity of the nuclear fuel rods; and · has lighter and stiffer fuel assembly, which may contribute to improved seismic performance.
Other sources of electricity, such as renewables like wind and solar, may also be viewed as safer than nuclear power, although we believe that generating nuclear energy with Lightbridge Fuel™ is the safest way to produce baseload electricity. To the extent demand for electricity generated by nuclear power decreases, the potential market for our nuclear fuel technology will decline.
Other sources of electricity, such as renewables like wind and solar, may also be viewed as safer than nuclear power, although we believe that generating nuclear energy with Lightbridge Fuel™ is the safest way to produce baseload electricity.
Government Support/Approvals Needed, Relationships with Critical Development Partners/Vendors and Other Government Regulation Due to our long fuel development timelines to commercialization and the significant amount of R&D funding required to bring our next generation nuclear fuel technology to market, substantial U.S. government funding and political support will be essential to the success of our nuclear fuel development program.
Government Support/Approvals Needed, Relationships with Critical Development Partners/Vendors and Other Government Regulation Due to our long fuel development timelines to commercialization and the significant amount of R&D funding required to bring our next generation nuclear fuel technology to market, substantial funding and/or in-kind contributions from government and/or strategic partners and/or other third-party sources as well as political support for our project will be essential to the success of our nuclear fuel development program.
We are working to develop Lightbridge Fuel™ to meet that goal. 5 Table of Contents As the nuclear power industry prepares to meet the increasing global demand for electricity production, nuclear utilities are seeking longer operating cycles and higher reactor power outputs for current and future reactor fleets.
A new fuel is needed to bring enhanced performance to reactors large and small. We are working to develop Lightbridge Fuel™ to meet that goal. As the nuclear power industry prepares to meet the increasing global demand for electricity production, nuclear utilities are seeking longer operating cycles and higher reactor power outputs for current and future reactor fleets.
As a result, ATF vendors have begun exploring opportunities for extending the operating cycle length from 18 to 24 months in existing PWRs by going to higher enrichments (i.e., from approximately 5% to 7-8% enrichments) with ATF designs.
As a result, ATF vendors have begun exploring opportunities for extending the operating cycle length in existing light water reactors (LWRs) and/or power uprates in BWRs by going to higher enrichments (i.e., from approximately 5% to 7-8% enrichments) with ATF designs.
Coextrusion is the primary forming operation in the manufacturing of our fuel and this demonstration was an important milestone on the path to developing and qualifying the full manufacturing process for actual fuel rods with enriched uranium. We plan to commence a FEED study for a Lightbridge pilot-scale fuel fabrication facility in 2023. Please see Item 1A.
Coextrusion is the primary forming operation in the manufacturing of our fuel and this demonstration was an important milestone on the path to developing and qualifying the full manufacturing process for actual fuel rods with enriched uranium. 10 Table of Contents Please see Item 1A.
We anticipate that the initial phase of work under the two agreements that has been released will culminate in irradiation testing in the Advanced Test Reactor (ATR) of our fuel material samples, known as fuel material coupons, using enriched uranium supplied by the DOE.
We anticipate that the initial phase of work under the two agreements that has been released will culminate in casting and extrusion of unclad fuel material samples using enriched uranium supplied by the DOE that will subsequently be inserted for irradiation testing in the Advanced Test Reactor (ATR) at INL.
Availability of suitable test loops in the ATR After the Halden research reactor was shut down in 2018, we embarked on a global search for an alternative for loop irradiation testing of our metallic fuel rods. Ultimately, we chose the ATR at INL and applied to the DOE for and won two GAIN Vouchers.
Availability of suitable test loops in the ATR After the Halden research reactor located in Halden, Norway, was shut down in 2018, we embarked on a global search for an alternative for loop irradiation testing of our metallic fuel rods.
We also believe that uprating a reactor with Lightbridge Fuel™ will add incremental electricity at a lower levelized cost than any other means of generating baseload electric power, including any renewable, fossil, or hydroelectric energy source, or any traditional nuclear fuel.
We also believe that uprating a reactor with Lightbridge Fuel™ will add incremental electricity at a lower levelized cost than any other means of generating baseload electric power, including any renewable, fossil, or hydroelectric energy source, or any traditional nuclear fuel. Emerging nuclear technologies include small modular reactors (SMRs), which are now in the development and licensing phases.
We ensure that we own intellectual property created for us by employees, independent contractors, consultants, companies, and any other third party by signing agreements with them that assign any intellectual property rights to us.
Our U.S. patents begin to expire in 2027. 12 Table of Contents We ensure that we own intellectual property created for us by employees, independent contractors, consultants, companies, and any other third-party by signing agreements with them that assign any intellectual property rights to us.
On December 15, 2022, the Company submitted a formal request to the DOE to join the HALEU Consortium to mitigate HALEU supply risk. On January 12, 2023, the Company received written confirmation from the DOE of Lightbridge’s membership in the HALEU Consortium.
On December 15, 2022, the Company submitted a formal request to the DOE to join the HALEU Consortium to mitigate HALEU supply risk. On January 12, 2023, the Company received written confirmation from the DOE of Lightbridge’s membership in the HALEU Consortium. HALEU is a key component necessary for the fabrication and operation of Lightbridge Fuel™ in light water reactors.
The framework agreements use an innovative structure and consist of an “umbrella” Strategic Partnership Project Agreement (SPP) and an “umbrella” Cooperative Research and Development Agreement (CRADA), each with Battelle Energy Alliance, LLC (BEA), the DOE’s operating contractor for INL, with an initial duration of seven years.
The framework agreements use an innovative structure that consists of an “umbrella” Strategic Partnership Project Agreement (SPP) and an “umbrella” Cooperative Research and Development Agreement (CRADA), each with BEA, with an initial duration of seven years.
Without significant U.S. government funding and cost sharing contributions toward our fuel development activities, it will be unfeasible for the Company to fund all of its future fuel development efforts on its own.
Without significant funding and cost sharing contributions from government and/or strategic partners and/or other third-party sources toward our fuel development activities, it will be unfeasible for the Company to fund all its future fuel development efforts on its own within the expected timelines or at all.
According to the World Nuclear Association (WNA), as of January 2022 there were 438 operable nuclear power reactors worldwide, mostly light water reactors, with the most common types being PWRs, including Russian-designed water-cooled, water-moderated energetic reactors (VVERs), and boiling-water reactors (BWRs). Nuclear power provides a non-fossil fuel, low-carbon energy solution that can meet baseload electricity needs.
According to the World Nuclear Association (WNA), as of January 2024, there were 437 operable nuclear power reactors worldwide, mostly light water reactors, with the most common types being PWRs, including Russian-designed water-cooled, water-moderated energetic reactors (VVERs), and boiling-water reactors (BWRs).
We believe that Lightbridge Fuel’s™ most significant economic benefit may be its ability to provide a 30% power uprate. However, the existing large reactors cannot realize that benefit because their systems are not designed to handle that much of an increase in power. The most additional power existing large PWRs could take from Lightbridge Fuel™ is estimated at approximately 17%.
We believe that most significant economic benefit of Lightbridge Fuel™ may be its potential to provide a 30% power uprate in new-build water-cooled reactors, as existing large reactors cannot realize that benefit because their systems are not designed to handle that much of an increase in power.
Raw Materials We do not plan to utilize any raw materials directly in the conduct of our operations (except for potential purchases of certain raw materials in small quantities for testing and demonstration efforts).
To the extent demand for electricity generated by nuclear power decreases, the potential market for our nuclear fuel technology will decline. 11 Table of Contents Raw Materials We do not plan to utilize any raw materials directly in the conduct of our operations (except for potential purchases of certain raw materials in small quantities for testing and demonstration efforts).
We are passionate about understanding the needs of our society, and we work hard to develop our next generation nuclear fuel. We also believe that supporting our team with a wonderful work environment supports and empowers us to accomplish our goals. The Company’s human resource professional is a resource available for employees regarding the development of their careers and training.
Our Culture Our mission is to help the world combat climate change and meet energy goals. We are passionate about understanding the needs of our society, and we work hard to develop our next generation nuclear fuel. We also believe that supporting our team with a wonderful work environment supports and empowers us to accomplish our goals.
Of the world’s reactors currently in operation, PWRs account for approximately 70% of the net operating capacity, with BWRs being the second most prevalent and accounting for approximately 14%. Of the nuclear reactors currently under construction, approximately 70% are PWRs with a rated electric power output of 1,000 megawatts or greater.
Of the world’s reactors currently in operation, PWRs account for approximately 70% of the net operating capacity, with BWRs being the second most prevalent and accounting for approximately 14% of net operating capacity. According to the WNA, as of January 2024, there are approximately 60 nuclear reactors under construction.
The US Nuclear Regulatory Commission (NRC) licensing processes require engineering analysis of a large break loss-of-coolant accident (LOCA), as well as other scenarios. The LOCA scenario assumes failure of a large water pipe in the reactor coolant system. Under LOCA conditions, the fuel and cladding temperatures rise due to reduced cooling capacity.
The LOCA scenario assumes failure of a large water pipe in the reactor coolant system. Under LOCA conditions, the fuel and cladding temperatures rise due to reduced cooling capacity.
Nuclear Industry and Addressable Market Overview of the Nuclear Power Industry According to the U.S. Energy Information Administration, nuclear power provided approximately 4.6% of the world’s total energy from all sources in 2020, including approximately 10.5% of global electricity generation.
Nuclear Industry and Addressable Market Overview of the Nuclear Power Industry Nuclear power provides a non-fossil fuel, low-carbon energy solution that can meet baseload electricity needs. According to the U.S. Energy Information Administration, nuclear power provided approximately 4.3% of the world’s total energy from all sources in 2022, including approximately 9% of global electricity generation.
Our patent applications are directed to our proprietary nuclear fuel technology and we seek additional patent protection for our fuel designs, development, and related alternatives by filing patent applications in the U.S. and other countries as appropriate. 12 Table of Contents We received 4 new patents in 2022 and currently have 13 pending patent applications.
Our Intellectual Property Our intellectual property rights include multiple U.S. and international patents and patent applications, trade secrets, trademark rights, and contractual agreements. Our patent applications are directed to our proprietary nuclear fuel technology and we seek additional patent protection for our fuel designs, development, and related alternatives by filing patent applications in the U.S. and other countries as appropriate.
Future Steps Toward Our Fuel Development and Timeline For The Commercialization of Our Nuclear Fuel Assemblies We anticipate fuel development milestones for Lightbridge Fuel™ over the next 2-3 years will consist of the following: · kick off SPP/CRADA work at INL leading to irradiation testing in the ATR of our fuel material coupons using enriched uranium supplied by INL. · conduct a feasibility study for the use of our nuclear fuel in CANDU heavy water reactors. · conduct a front-end engineering and design (FEED) study for a Lightbridge pilot-scale fuel fabrication facility. · demonstrate extrusion with our uranium-zirconium fuel alloy and produce fuel material coupons for irradiation testing.
Future Steps Toward Our Fuel Development and Timeline For The Commercialization of Our Nuclear Fuel Assemblies We anticipate fuel development milestones for Lightbridge Fuel™ over the next 2-3 years will consist of the following: · continue to execute SPP/CRADA work at INL leading to casting and extrusion of unclad fuel material samples using enriched uranium and their subsequent insertion for irradiation testing in the ATR. · complete a feasibility study for the use of our nuclear fuel in CANDU heavy water reactors. · complete a FEED study for a LPFFF in collaboration with Centrus Energy. · commence manufacturing efforts relating to co-extrusion of cladded rodlets for loop irradiation testing.
As of December 31, 2022, we held 5 U.S. patents and more than 140 foreign patents. The expiration dates of these patents, unless it’s a divisional patent filing, are generally 20 years from their application dates. Our U.S. patents begin to expire in 2027.
We received 1 new patent (worldwide) in 2023 and currently have 12 pending patent applications (worldwide). As of December 31, 2023, we held 11 U.S. patents and more than 146 foreign patents. The expiration dates of these patents, unless it is a divisional patent filing, are generally 20 years from their application dates.
If new test loops are not added to the ATR, loop irradiation testing in the ATR may not provide sufficient data to justify regulatory approval for LTA testing in a large commercial PWR in a commercially feasible timeframe.
If sufficient loop capacity within the ATR is not available, we may not be able to obtain sufficient data to justify regulatory approval for LTA demonstration in a large commercial PWR in a commercially feasible timeframe.
We have built a significant portfolio of patents reflecting years of R&D, and we anticipate testing our nuclear fuel through third party vendors and others, including the United States Department of Energy’s (DOE) national laboratories. Currently, we are performing the majority of our R&D activities with the DOE’s national laboratories.
We expect Lightbridge Fuel™ to generate more power in SMRs than traditional nuclear fuels. We have built a significant portfolio of patents, and we anticipate testing our nuclear fuel through third-party vendors and others, including the United States Department of Energy’s (DOE) national laboratories.
Our fuel potentially could be used to dispose of plutonium from reprocessed used reactor fuel, utilizing the plutonium to generate electricity. Our fuel potentially also could be used to dispose of plutonium from nuclear weapons.
A modified variant of Lightbridge Fuel TM incorporating plutonium instead of, or in addition to, uranium in the metallic fuel rods could potentially be used to dispose of plutonium from reprocessed used reactor fuel, utilizing the plutonium to generate electricity. Our fuel also has the potential to be used to dispose of excess plutonium from nuclear weapons.
Target Market for Lightbridge Fuel™ Our target market segments include water-cooled commercial power reactors, such as PWRs, BWRs, VVERs, CANDUs heavy water reactors, water-cooled SMRs, as well as water-cooled research reactors. 6 Table of Contents Nuclear Power as Clean and Low Carbon Emissions Energy Source Nuclear power provides clean, reliable baseload electricity.
Target Market for Lightbridge Fuel™ Our target market segments include water-cooled commercial power reactors, such as PWRs, BWRs, VVERs, CANDU heavy water reactors, water-cooled SMRs, as well as water-cooled research reactors.
Idaho National Laboratory Agreements In the second half of 2022 Lightbridge entered into agreements with Idaho National Laboratory (INL), in collaboration with the DOE, to support the development of Lightbridge Fuel™.
Idaho National Laboratory Agreements In December 2022, Lightbridge entered into agreements with Battelle Energy Alliance, LLC (BEA), the DOE’s operating contractor for Idaho National Laboratory (INL), to support the development of Lightbridge Fuel™.
We believe our fuel designs will allow current and new build nuclear reactors to safely increase power production and reduce operations and maintenance costs on a per kilowatt-hour basis. New build nuclear reactors could also benefit from the reduced upfront capital investment per kilowatt of generating capacity in the case of implementing a power uprate.
New-build nuclear reactors could also benefit from the reduced upfront capital investment per kilowatt of generating capacity in the case of new-build reactors implementing a power uprate.
U.S. government funding support Presently, our ability to fund our fuel development program at a level necessary to adhere to our projected fuel development timelines is severely limited due to funding constraints. This is in addition to our corporate overhead and other fixed costs, such as in-house project management and project control personnel.
Funding and/or in-kind support from government and/or strategic partners and/or other third-party sources Presently, our ability to fund our fuel development program at a level necessary to adhere to our projected fuel development timelines is severely limited due to funding constraints.
That said, we believe Lightbridge Fuel™ remains the only advanced light-water reactor fuel in development that can provide power uprates, cycle length extensions, improved safety, and load following in a single product as desired by the utilities. 11 Table of Contents Nuclear power faces competition from other sources of electricity as well, including natural gas, which at times in recent years has been the cheapest option for power generation in the U.S. and has resulted in some utilities abandoning nuclear initiatives.
Nuclear power faces competition from other sources of electricity as well, including natural gas, which at times in recent years has been the cheapest option for power generation in the U.S. and has resulted in some utilities abandoning nuclear initiatives.
As a result, we believe seeking and securing significant U.S. government funding to support our fuel development program is essential for us to be successful in our fuel development and commercialization efforts.
As a result, we believe seeking and securing significant funding and/or in-kind contributions from government and/or strategic partners and/or other third-party sources to support our fuel development program is essential for us to adhere to our expected timelines for our fuel development and commercialization efforts. 9 Table of Contents 2.
We believe this can be done only with a large increase in nuclear power, several times the amount that is generated globally today. We believe that our nuclear fuel technology will be an essential element of reaching this goal, for electricity generation and potentially to produce hydrogen for zero-carbon liquid fuels.
We believe this can be done only with a large increase in nuclear power, several times the amount that is generated globally today.
Our Nuclear Fuel Since 2008, we have been engaged in the design and development of proprietary, innovative nuclear fuels to improve the cost competitiveness, safety, proliferation resistance and performance of nuclear power generation. In 2010, we announced the concept of all-metal fuel (i.e., non-oxide fuel) for use in currently operating and new-build reactors.
Currently, we are performing the majority of our research and development (R&D) activities within and in collaboration with the DOE’s national laboratories. Our Nuclear Fuel Since 2008, we have been engaged in the design and development of proprietary, innovative nuclear fuels to improve the cost-competitiveness, safety, proliferation resistance and performance of nuclear power generation.
European countries are responding by rethinking their plans for nuclear energy by either keeping existing nuclear power plants running or moving ahead with plans for new plants or both. The United Kingdom is deploying new nuclear power plants. Belgium has decided to reverse its decision to close all of its nuclear plants in the wake of Russia’s invasion of Ukraine.
For example, the United Kingdom and France are deploying new nuclear power plants, Belgium has decided to reverse its decision to close all its nuclear plants in the wake of Russia’s invasion of Ukraine and Canada, Sweden, Romania, Ghana, and several other countries have announced plans to deploy new nuclear power plants.
We also have physical and mental health programs that are available to our employees. We believe that our relationship with our employees and contractors is satisfactory. Diversity and Inclusion To truly help the world combat climate change, we need to work with a diversity of partners as well as have a diverse workforce.
Diversity and Inclusion To truly help the world combat climate change, we need to work with a diversity of partners as well as have a diverse workforce. We also must operate with a high degree of awareness of evolving social conditions and social justice and create policy accordingly.
MIT Study - Lightbridge Fuel™ In June 2022, the DOE selected Lightbridge Fuel™ to participate in a study led by the Massachusetts Institute of Technology (MIT) to investigate the performance and economics of accident tolerant fuels for light water cooled SMRs.
The study led by MIT and funded by DOE relates to evaluation of accident tolerant fuels in various SMRs. The project aims to simulate the fuel and safety performance of Lightbridge Fuel™ for the NuScale SMR and provide scoping analysis to improve the safety and economics of water-cooled SMRs.
We believe an equitable and inclusive environment with diverse teams produces more creative solutions and results in better outcomes for our employees and stakeholders. We strive to attract, retain and promote diverse talent at all levels of the organization.
We acknowledge that these measures evolve over time, and we are committed to improving our policies as awareness of social inequities or injustice arise. We believe an equitable and inclusive environment with diverse teams produces more creative solutions and results in better outcomes for our employees and stakeholders.
We have reimagined nuclear fuel from scratch, using advanced science and engineering. Our focus on metallic fuel was inspired by listening to the voices of prospective customers, as nuclear utilities expressed interest in the improved economics and enhanced safety that we believe metallic fuel will provide. The fuel in a nuclear reactor generates energy in the form of heat.
In 2010, we announced the concept of all-metal fuel (i.e., non-oxide fuel) for use in currently operating and new-build reactors. Our focus on metallic fuel was inspired by the anticipated needs of prospective customers, as nuclear utilities have expressed interest in the improved economics and enhanced safety that we believe metallic fuel will provide.
Many of these passive systems rely on a combination of gravity, natural convection, and/or resistance to high temperatures. We are developing our fuel technology for application in various types of water-cooled reactors, including existing or future light water reactors, which include water-cooled small modular reactors, as well as for Canada Deuterium Uranium (CANDU)-type pressurized heavy water reactors.
Most reactors currently under construction or planned for future construction are located in Asia. We expect Lightbridge Fuel™ to be able to operate in various types of water-cooled reactors, including existing or future light water reactors, which include water-cooled SMRs, as well as for Canada Deuterium Uranium (CANDU)-type pressurized heavy water reactors.
Development of Lightbridge Fuel™ Recent Developments HALEU Consortium Membership To support establishment of domestic high-assay low-enriched uranium (“HALEU”) infrastructure, the DOE announced on December 7, 2022 the creation of a HALEU Consortium.
The work is expected to be completed in 2024 at a fixed price of approximately $0.2 million. HALEU Consortium Membership To support establishment of domestic HALEU infrastructure, the DOE announced on December 7, 2022 the creation of a HALEU Consortium.
Growing Importance of Energy Security We believe that Russia’s invasion of Ukraine has made clear the need for countries to wean off dependency on fossil fuels from countries that can threaten their national security. Oil and natural gas prices have increased significantly since Russia commenced its invasion in early 2022 and many countries have imposed sanctions upon Russia in response.
We believe that our nuclear fuel technology could play an important role toward reaching this goal. 6 Table of Contents Growing Importance of Energy Security We believe that Russia’s invasion of Ukraine has made clear the need for countries to diversify their energy production and wean off dependency on fossil fuels provided by countries that may threaten their national security.
Our nuclear fuel could significantly improve the economics and safety of existing and new nuclear power plants, large and small, enhance proliferation resistance of spent nuclear fuel, and have a meaningful impact on addressing climate change and air pollution, all while benefiting national security.
Overview At Lightbridge, we are developing next generation nuclear fuel for water-cooled reactors that could significantly improve the economics and safety of existing and new nuclear power plants, large and small, and enhance proliferation resistance of spent nuclear fuel while supplying clean energy to the electric grid.
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Overview At Lightbridge we are developing the next generation of nuclear fuel to impact, in a meaningful way, the world’s climate and energy security problems.
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Accordingly, the highest power uprate existing large PWRs could take from Lightbridge Fuel™ is estimated to be approximately 17%. Nuclear Power as Clean and Low Carbon Emissions Energy Source Nuclear power provides clean, reliable baseload electricity.
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Emerging nuclear technologies that many in the nuclear power industry believe have the potential to help drive growth in nuclear power include small modular reactors (SMRs), which are now in the development and licensing phases.
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As a result of this military conflict, oil and natural gas prices surged in early 2022, and many countries have imposed sanctions upon Russia in response. European countries have responded by reconsidering their plans for domestically produced nuclear energy by either keeping existing nuclear power plants running or moving ahead with plans for new plants or both.
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We expect Lightbridge Fuel™ to generate more power in SMRs than traditional nuclear fuels, which will help decarbonize sectors that are now powered by fossil fuels. We expect that our ongoing research and development (R&D) initiatives will lead to Lightbridge Fuel™ powering SMRs for multiple purposes. The first SMRs are expected to begin operations as early as 2029.
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Due to the significantly lower fuel operating temperature and higher thermal conductivity, our metallic nuclear fuel rods are expected to provide major improvements to safety margins during certain off-normal events. The US Nuclear Regulatory Commission (NRC) licensing processes require engineering analysis of a large break loss-of-coolant accident (LOCA), as well as other scenarios.
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A new fuel is needed to bring enhanced performance to reactors large and small.
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Development of Lightbridge Fuel™ We believe our metallic fuel could be able to operate in different types of water-cooled commercial power reactors, such as pressurized water reactors (including VVERs), boiling-water reactors, heavy water pressurized reactors, such as CANDUs, water-cooled SMRs, and water-cooled research reactors. 7 Table of Contents We have obtained patent protection in a number of countries and will continue to seek patent validation in countries that either currently operate or are expected to build and operate a large number of nuclear power reactors compatible with our fuel technology.
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Almost all the new build reactors currently under construction are either Generation III or Generation III+ type reactors. The primary difference from second-generation designs is that many Generation III or Generation III+ reactors incorporate passive or inherent safety features, which require no active controls or operational intervention to avoid accidents in the event of malfunction.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAdditionally, sanctions or other restrictions on payments made to Russia imposed by the United States government in response to Russia’s invasion of Ukraine may make it more difficult for us to maintain patent protection in certain foreign jurisdictions. Certain of our patents are maintained by the Eurasian Patent Office and the Russian patent office, Rospatent.
Biggest changeAccordingly, our efforts to enforce our intellectual property and proprietary rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license. 21 Table of Contents Additionally, sanctions or other restrictions on payments made to Russia imposed by the United States government in response to Russia’s invasion of Ukraine may make it more difficult for us to maintain patent protection in certain foreign jurisdictions.
A failure to enter into a commercial arrangement with one or more of existing nuclear fuel fabricators could adversely affect our business, financial condition, and results of operations and may result in the failure of the Company.
A failure to enter into a commercial arrangement with one or more existing nuclear fuel fabricators could adversely affect our business, financial condition, and results of operations and may result in the failure of the Company.
Our current plan is to maximize external funding from third party sources, including the DOE, to support the remaining development, testing and demonstration activities relating to our metallic nuclear fuel technology.
Our current plan is to maximize external funding from third-party sources, including potentially the DOE, to support the remaining development, testing and demonstration activities relating to our metallic nuclear fuel technology.
If a patent infringement suit were brought against us, we could be forced to stop or delay commercialization of the fuel design or a component thereof that is the subject of the suit.
If a patent infringement suit were brought against us, we could be forced to stop or delay commercialization of our fuel design or a component thereof that is the subject of the suit.
Any breach of our security measures, or even a perceived breach of our security measures, could cause us to lose potential customers and governmental approvals; suffer material harm to our business, financial condition, operating results and reputation; or be subject to regulatory actions, litigation, sanctions or other statutory penalties.
Any breach of our security measures, or even a perceived breach of our security measures, could cause us to lose potential customers, government contracts and governmental approvals; suffer material harm to our business, financial condition, operating results, and reputation; or be subject to regulatory actions, litigation, sanctions, or other statutory penalties.
As a result, commercialization of our nuclear fuel technology may be significantly delayed, perhaps indefinitely, which would adversely affect our business, financial condition, and results of operations. Our current R&D plan includes the use of research reactors made available by the U.S. government and the DOE, including but not limited to the ATR at INL.
As a result, commercialization of our nuclear fuel technology may be significantly delayed, perhaps indefinitely, which would adversely affect our business, financial condition, and results of operations. 15 Table of Contents Our current R&D plan includes the use of research reactors made available by the U.S. government and the DOE, including but not limited to the ATR at INL.
There is also a risk associated with possible negative perception of uranium enrichment greater than 5% that could potentially delay or hinder regulatory approval of our nuclear fuel designs. Our nuclear fuel designs rely on fabrication technologies that in certain material ways are different from the fabrication techniques presently utilized by existing commercial fuel fabricators.
There is also a risk associated with possible negative perception of uranium enrichment greater than 5% that could potentially delay or hinder regulatory approval of our nuclear fuel designs. 16 Table of Contents Our nuclear fuel designs rely on fabrication technologies that in certain material ways are different from the fabrication techniques presently utilized by existing commercial fuel fabricators.
Further, based on the results of our phase I Section 382 study, it’s likely our NOLs generated prior to the 2018 tax year will expire unused given the 20-year carry forward period for these NOLs.
Further, based on the results of our phase I Section 382 study in 2022, it’s likely our NOLs generated prior to the 2018 tax year will expire unused given the 20-year carry forward period for these NOLs.
The pursuit of potential acquisitions may divert the attention of management and cause us to incur various expenses in identifying, investigating and pursuing suitable acquisitions, whether or not they are consummated. If we acquire additional businesses, we may not be able to integrate the acquired personnel, operations and technologies successfully, or effectively manage the combined business following the acquisition.
The pursuit of potential acquisitions may divert the attention of management and cause us to incur various expenses in identifying, investigating, and pursuing suitable acquisitions, whether or not they are consummated. 20 Table of Contents If we acquire additional businesses, we may not be able to integrate the acquired personnel, operations, and technologies successfully, or effectively manage the combined business following the acquisition.
If our competitors independently develop equivalent knowledge, methods, and know-how, we would not be able to assert our trade secrets against them and our business could be harmed. 21 Table of Contents Applicable Russian intellectual property law may not protect some of our intellectual property, which could have a material adverse effect on our business.
If our competitors independently develop equivalent knowledge, methods, and know-how, we would not be able to assert our trade secrets against them and our business could be harmed. Applicable Russian intellectual property law may not protect some of our intellectual property, which could have a material adverse effect on our business.
There is a risk that the fuel fabrication process utilized to date to produce our metallic fuel rods may not be feasibly adapted to the fabrication of full-length metallic fuel rods usable in commercial reactors. 16 Table of Contents The cost of production of our nuclear fuel could be prohibitively expensive.
There is a risk that the fuel fabrication process utilized to date to produce our metallic fuel rods may not be feasibly adapted to the fabrication of full-length metallic fuel rods usable in commercial reactors. The cost of production of our nuclear fuel could be prohibitively expensive.
Any such issuance could result in substantial dilution to our existing stockholders and cause the trading price of our common stock to decline. Our ability to utilize our net operating loss carryforwards to offset future taxable income will be limited.
Any such issuance could result in substantial dilution to our existing stockholders and cause the trading price of our common stock to decline. Our ability to utilize our net operating loss carryforwards to offset future taxable income will be limited and may also expire.
Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial cost and divert our efforts and attention from other aspects of our business. We have identified a material weakness in our internal control over financial reporting.
Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial cost and divert our efforts and attention from other aspects of our business. 22 Table of Contents We have identified a material weakness in our internal control over financial reporting.
Additionally, we believe our metallic fuel can be used in CANDU heavy water reactors. However, we have yet to conduct a feasibility study to confirm our fuel’s suitability for those types of reactors.
Additionally, we believe our metallic fuel can be used in CANDU heavy water reactors. However, we have yet to complete our feasibility study to confirm our fuel’s suitability for those types of reactors.
We are dependent upon significant U.S. government funding and political support for nuclear power in order to complete our fuel development efforts and commercialize our nuclear fuel technology.
We are dependent upon significant U.S. government funding and/or in-kind contributions and political support for nuclear power in order to complete our fuel development efforts and commercialize our nuclear fuel technology.
Our projected fuel development timeline is dependent upon significant funding from the U.S. government to not only support our ongoing R&D efforts, but to provide confidence to our investors and reduce the need to raise funds through the issuance of additional dilutive equity securities.
Our projected fuel development timeline is dependent upon receiving significant funding and/or in-kind contributions from the U.S. government to not only support our ongoing R&D efforts, but to also provide confidence to our investors and reduce the need to raise funds through the issuance of additional dilutive equity securities.
Disruptions from cybersecurity events may jeopardize the security of information stored in and transmitted through our systems or the systems of outsourcing parties.
Disruptions from cybersecurity events may jeopardize the security of information, trade secrets, or confidential data stored in and transmitted through our systems or the systems of outsourcing parties.
Each of the Eurasian Patent Office and Rospatent use the Russian Central Bank to process patent annuity payments. The U.S. Office of Foreign Assets Control (OFAC) has identified the Russian Central Bank as a sanctioned entity.
Certain of our patents are maintained by the Eurasian Patent Office and the Russian patent office, Rospatent. Each of the Eurasian Patent Office and Rospatent use the Russian Central Bank to process patent annuity payments. The U.S. Office of Foreign Assets Control (OFAC) has identified the Russian Central Bank as a sanctioned entity.
Any capital raises may cause significant dilution to our shareholders. As of December 31, 2022, we had $28.9 million in cash and cash equivalents. We have experienced substantial and recurring losses from operations, which has created an accumulated deficit of $144.5 million as of December 31, 2022.
Any capital raises may cause significant dilution to our shareholders. As of December 31, 2023, we had $28.6 million in cash and cash equivalents. We have experienced substantial and recurring losses from operations, which has created an accumulated deficit of $152.4 million as of December 31, 2023.
The Company has identified alternative options to generate the irradiation data we need to support regulatory licensing of our LTA operation in a commercial reactor but pursuing such alternatives to the Halden research reactor may significantly delay further testing of our fuel designs. We may not be able to contractually secure another reactor in which to test our fuel designs.
The Company has identified alternative options to generate the irradiation data we need to support regulatory licensing of our LTA operation in a commercial reactor, such as the ATR at INL, but pursuing such alternatives to the Halden research reactor may significantly delay further testing of our fuel designs.
We also may not achieve the anticipated benefits from the acquired business due to a number of factors, including: · inability to integrate or benefit from acquired technologies or services in a profitable manner; · unanticipated costs or liabilities associated with the acquisition; · difficulty integrating the accounting systems, operations and personnel of the acquired business; · diversion of management’s attention from other business concerns; · adverse effects to our existing business relationships with business partners as a result of the acquisition; · the potential loss of key employees; · use of resources that are needed in other parts of our business; and · use of substantial portions of our available cash to consummate the acquisition. 20 Table of Contents In addition, a significant portion of the purchase price of companies we acquire may be allocated to acquired goodwill and other intangible assets, which must be assessed for impairment at least annually.
We also may not achieve the anticipated benefits from the acquired business due to a number of factors, including: · inability to integrate or benefit from acquired technologies or services in a profitable manner; · unanticipated costs or liabilities associated with the acquisition; · difficulty integrating the accounting systems, operations, and personnel of the acquired business; · diversion of management’s attention from other business concerns; · adverse effects to our existing business relationships with business partners as a result of the acquisition; · the potential loss of key employees; · use of resources that are needed in other parts of our business; and · use of substantial portions of our available cash to consummate the acquisition.
Shareholder activism, which can take many forms and arise in a variety of situations, could result in substantial costs and divert management and our board’s attention and resources from our business.
Shareholder activism could cause us to incur significant expense, hinder execution of our business strategy and impact our stock price. Shareholder activism, which can take many forms and arise in a variety of situations, could result in substantial costs, and divert management and our board’s attention and resources from our business.
In addition, deterioration in our relationship with the U.S. national laboratories that are parties to these agreements and/or the DOE could impair or impede our ability to successfully implement these agreements, which could adversely affect our R&D activities.
In addition, deterioration in our relationship with the U.S. national laboratories that are parties to these agreements and/or the DOE could impair or impede our ability to successfully implement these agreements, which could adversely affect our R&D activities. 14 Table of Contents The amount of time and funding needed to bring our nuclear fuel to market may greatly exceed our projections.
We may not anticipate these techniques or implement adequate preventive measures. We currently expend and may be required to expend significant additional capital and other resources to protect against such security breaches or to alleviate problems caused by such breaches. Our insurance coverage may be inadequate to compensate us for any related losses we incur.
We, or the third-parties with whom we contract, may not anticipate these techniques or implement adequate preventive measures. We currently expend and may be required to expend significant additional capital and other resources to protect against such security breaches or to alleviate problems caused by such breaches.
In addition, such preferred stock may contain provisions allowing it to be converted into shares of common stock, which could dilute the value of our common stock to then current stockholders and could adversely affect the market price of our common stock. 22 Table of Contents There may be volatility in our stock price, which could negatively affect investments, and our stockholders may not be able to resell their shares at or above the value they originally purchased such shares.
In addition, such preferred stock may contain provisions allowing it to be converted into shares of common stock, which could dilute the value of our common stock to the then current stockholders and could adversely affect the market price of our common stock.
Management, including our Chief Executive Officer and our Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2022 and concluded that we did not maintain effective internal control over financial reporting. Specifically, management identified a material weakness relating to recording accounts payable invoices. See Part II.
Management, including our Chief Executive Officer and our Chief Financial Officer (CFO), assessed the effectiveness of our internal control over financial reporting as of December 31, 2023 and concluded that we did not maintain effective internal control over financial reporting.
A failure of our current and future economic models, or a failure to find a strategic alternative, such as a potential business combination partner, would adversely affect our business, financial condition, and results of operations and may result in the failure of the Company. Development of our nuclear fuel technology is dependent upon the availability of a test reactor.
A failure of our current and future economic models, or a failure to find a strategic alternative, such as a potential business combination partner, would adversely affect our business, financial condition, and results of operations and may result in the failure of the Company. We may not achieve the expected benefits from our collaboration agreement with Centrus Energy Corp.
Our pending and future patent applications may not issue as patents or, if issued, may not issue in a form that will be advantageous to us.
We do not know how successful we would be should we choose to assert our patents or other intellectual property rights against suspected infringers. Our pending and future patent applications may not issue as patents or, if issued, may not issue in a form that will be advantageous to us.
Shipping delays exist worldwide, as there is much greater demand for shipping and reduced capacity. Additionally, certain material and equipment prices are expected to remain at historically high levels in 2023 due to inflationary cost pressures and global transportation complexities.
Labor shortages and supply chain disruptions could prevent us from meeting our R&D timelines and have a negative impact on our financial results. Shipping delays exist worldwide, as there is much greater demand for shipping and reduced capacity. Additionally, certain material and equipment prices are expected to remain at high levels due to inflationary cost pressures and global transportation complexities.
Congress, and cannot be assured. Changes in these factors are outside of the Company’s control and could cause significant delays and/or cost increases in our R&D programs.
Funding for any improvement of capabilities or continued operations of these reactors is subject to the priorities of the U.S. government, as well as the appropriation of funding by the U.S. Congress, and cannot be assured. Changes in these factors are outside of the Company’s control and could cause significant delays and/or cost increases in our R&D programs.
We own a variety of patents and patent applications in the United States, as well as corresponding patents and patent applications in several other jurisdictions. We have not obtained patent protection in each market in which we plan to compete. We do not know how successful we would be should we choose to assert our patents against suspected infringers.
We own a variety of patents and patent applications in the United States, as well as corresponding patents and patent applications in several other jurisdictions. We have not obtained patent protection in each market in which we plan to compete. Furthermore, our patents, trade secrets, information and intellectual property may be the subject of infringement by third-parties.
If new loops are not added to the ATR, loop irradiation testing in the ATR may not provide sufficient data to justify regulatory approval for LTA testing in a large commercial PWR in a commercially feasible timeframe.
If sufficient capacity within the ATR is not available, we may not be able to obtain sufficient data to justify regulatory approval for LTA demonstration in a large commercial PWR in a commercially feasible timeframe.
The stock market may experience extreme volatility that is often unrelated to the performance of particular companies. These market fluctuations may cause our stock price to fall regardless of the Company’s performance.
The stock market may experience extreme volatility that is often unrelated to the performance of particular companies. These market fluctuations may cause our stock price to fall regardless of the Company’s performance. 23 Table of Contents The issuance of additional stock in connection with financings, acquisitions, investments, our stock incentive plans or otherwise will dilute all other stockholders.
The sales and marketing of our technology internationally may be subject to U.S. export control regulations and the export control laws of other countries. Governmental authorizations may be required before we can export our technology. If authorizations are required and not granted, our international business could be materially affected. The export authorization process is often time consuming.
We may not be able to receive or retain authorizations that may be required for us to sell or license our technology internationally. The sales and marketing of our technology internationally may be subject to U.S. export control regulations and the export control laws of other countries. Governmental authorizations may be required before we can export our technology.
As a result, the validity and enforceability of our patents cannot be predicted with certainty. We also rely on trade secrets to protect some of our technology, especially where it is believed that patent protection is undesirable for the Company or unobtainable.
We also rely on trade secrets to protect some of our technology, especially where it is believed that patent protection is undesirable for the Company or unobtainable. We generally require our employees, consultants, advisors, and collaborators to execute appropriate agreements with us regarding the safeguarding of confidential information.
Our nuclear fuel fabrication process is dependent on outside suppliers of nuclear and other materials and any difficulty by a fuel fabricator in obtaining these materials could be detrimental to our ability to eventually market our nuclear fuel through a fuel fabricator.
Upon commercialization, a reduction or elimination of customer contracts or future customer contracts resulting from lower public support, less raw materials, lower demand, increased regulation, and increased costs could adversely affect our business model and future prospects. 17 Table of Contents Our nuclear fuel fabrication process is dependent on outside suppliers of nuclear and other materials and any difficulty by a fuel fabricator in obtaining these materials could be detrimental to our ability to eventually market our nuclear fuel through a fuel fabricator.
Any difficulties in obtaining these materials by fuel fabricators could have a material adverse effect on their ability to market fuel based on our technology. 17 Table of Contents Labor shortages and supply chain disruptions could prevent us from meeting our R&D timelines and have a negative impact on our financial results.
Any difficulties in obtaining these materials by fuel fabricators could have a material adverse effect on their ability to market fuel based on our technology.
We also may decide to pursue transactions even if they would result in an ownership change and impair our ability to use our NOLs.
We also may decide to pursue transactions even if they would result in an ownership change and impair our ability to use our NOLs. In addition, any changes to tax rules and regulations or the interpretation of tax rules and regulations could negatively impact our ability to recognize any potential benefits from our NOLs or net unrealized built-in losses.
Our existing patents and any future patents we obtain may not be sufficiently broad to prevent others from practicing our technologies or from developing competing products and technologies. In addition, in general the patent positions of energy technology companies are highly uncertain and involve complex legal and factual questions for which important legal principles remain unresolved.
Our existing patents and any future patents we obtain may not be sufficiently broad to prevent others from practicing our technologies or from developing competing products and technologies.
This would likely necessitate an extra fuel development step of LTR testing in a large commercial PWR in addition to the ATR loop testing before LTA testing could commence. 15 Table of Contents Funding for any improvement of capabilities or continued operations of these reactors is subject to the priorities of the U.S. government, as well as the appropriation of funding by the U.S.
This would likely necessitate additional loop irradiation testing in another test reactor or LTR demonstration in a large commercial PWR in addition to the ATR loop testing before LTA demonstration could commence.
These issues are likely to become more difficult as we expand our operations.
Our insurance coverage may be inadequate to compensate us for any related losses we incur and, in some cases, our insurance coverage may not cover the cyber incident at all. These issues are likely to become more difficult as we expand our operations.
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Also, a COVID-19 outbreak, including the emergence and spread of variant strains of the virus or other pathogens, may affect future operations of the U.S. national laboratories. 14 Table of Contents The amount of time and funding needed to bring our nuclear fuel to market may greatly exceed our projections.
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On December 7, 2023, we announced the Company's entry into a collaboration agreement with Centrus Energy Corp. to engage in a front-end engineering and design (FEED) study to add a dedicated Lightbridge Pilot Fuel Fabrication Facility (LPFFF) at the American Centrifuge site in Piketon, Ohio.
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We rely upon our senior management and other highly skilled personnel, and if we are not successful in retaining or attracting highly qualified personnel, we may not be able to successfully implement our business strategy.
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The FEED study is intended to identify infrastructure and licensing requirements as well as the estimated cost and deployment schedule for the LPFFF. Centrus Energy’s wholly-owned subsidiary, American Centrifuge Operating, LLC, will lead the study, which is expected to be completed in 2024.
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Our success depends, in significant part, upon our senior management, including Seth Grae, our Chief Executive Officer, Andrey Mushakov, our Executive Vice President - Nuclear Operations, and Larry Goldman, our Chief Financial Officer. Mr. Grae’s and Dr.
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The American Centrifuge Plant is currently the only place in the world to produce HALEU in UF6 form outside of Russia.
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Mushakov’s knowledge of the nuclear power industry, their networks of key contacts within that industry and in governments and, in particular, their expertise in the potential markets for our technologies, are critical to the implementation of our business strategy. Mr. Grae, Dr. Mushakov, and Mr. Goldman are likely to be significant factors in our future growth and success.
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There can be no guarantee that the FEED study will return results that confirm the feasibility of a LPFFF and may indicate that the infrastructure and licensing requirements or the estimated cost or timelines to deploy the LPFFF would be overly onerous, too lengthy or prohibitively expensive to proceed with the deployment of the LPFFF.
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Our success also depends on our ability to attract, motivate, develop, and retain a sufficient number of other highly skilled personnel, including consultants, managers, and nuclear engineers.
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If the FEED study indicates that the LPFFF cannot be completed at the American Centrifuge Plant on terms acceptable to us, it may delay our anticipated timeline for the commercialization of our fuel, which would adversely affect our business, financial condition, and results of operations. Development of our nuclear fuel technology is dependent upon the availability of a test reactor.
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Competition for employees and consultants in the nuclear industry is intense, partially as a result of a recent resurgence in the nuclear industry after decades of relative decline, and we may not be successful in attracting and retaining such personnel. For example, a senior nuclear engineer recently resigned from the Company and became a consultant to the Company.
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We may not be able to contractually secure another reactor in which to test our fuel designs.
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The Company may be unsuccessful in finding a replacement for this senior nuclear engineer on comparable terms.
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We rely on a limited number of suppliers for HALEU or other key source materials and/or key components and/or key equipment necessary for the development and fabrication of our nuclear fuel, which could, under certain circumstances, adversely delay our research and development activities.
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In addition, while we intend to partner with other entities in developing and commercializing our nuclear fuel technology, such other entities may also have difficulty in attracting and retaining nuclear engineers and other personnel and may not have adequate resources to dedicate to our joint projects. The loss of services by any of Mr. Grae, Dr. Mushakov, or Mr.
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If the supply of a single-sourced or limited-sourced material and/or key component and/or key equipment is delayed or ceases, we may not be able to produce the related test fuel rod, which could adversely delay our research and development activities.
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Goldman, or the inability of us or our partners to retain or attract highly skilled personnel, could delay or suspend development and commercialization of our nuclear fuel technology, adversely affect our ability to meet customer needs, or increase our expenses, any of which could have a material adverse effect on our business, results of operations or financial condition.
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In addition, a single-source or limited-source supplier of a key component or a key piece of equipment could potentially exert significant bargaining power over price, quality, or other terms relating to these materials or equipment, which could have a material adverse effect on our financial condition, results of operations and cash flows.
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Competition for highly qualified technical personnel is intense in our industry. Our future success depends in part on our ability to contract with, hire, integrate, and retain engineers and scientists, and other qualified personnel with a focus in our nuclear fuel technology and products. Competition for these skilled professionals is intense.
Added
We are dependent on management and key personnel for our success, and the loss of which could have a material adverse effect on our business.
Removed
If we are unable to adequately anticipate our needs for certain key competencies and implement human resource solutions to recruit or improve these competencies, our business, results of operations and financial condition would suffer.
Added
Our business depends upon the recruitment and continued service of our highly skilled, educated, and trained employees, and the loss of, or the inability to attract and retain, qualified personnel could have a material adverse effect on our business. Our ability to attract, motivate, compensate, and retain highly qualified and diverse employees is necessary to support and achieve business objectives.
Removed
In addition, a loss of the service of any of our existing skilled employees or contractors could have a significant negative effect on our ability to operate. 18 Table of Contents We may not be able to receive or retain authorizations that may be required for us to sell or license our technology internationally.
Added
Competition for skilled and diverse employees in our industry can be intense, and any uncertainty surrounding future employment opportunities, organizational and reporting structures and related concerns may impair our ability to attract and retain qualified employees. 18 Table of Contents The loss of the services of qualified employees and any inability to recruit effective replacements or to otherwise attract, motivate, train, or retain highly qualified and diverse employees could have a material adverse effect on our business, financial condition, and results of operations.
Removed
We generally require our employees, consultants, advisors, and collaborators to execute appropriate agreements with us regarding the safeguarding of confidential information.
Added
Also, any significant leadership change and accompanying senior management transition involves inherent risk, and any failure to ensure a smooth transition could hinder our strategic planning, execution, and future performance.
Removed
If we are unable to comply with the listing requirements of the Nasdaq Capital Market, it would result in our common stock being delisted, which could affect its market price and liquidity and reduce our ability to raise capital.
Added
While we strive to mitigate the negative impact associated with changes to our senior management team, such changes may cause uncertainty among investors, employees, and others concerning our future direction and performance.
Removed
If we fail to maintain compliance with, or otherwise fail to comply with, all applicable continued requirements, Nasdaq may determine to delist our common stock, which could substantially decrease trading in our common stock and adversely affect the market liquidity of our common stock and cause the market price of our common stock to decline.
Added
If we fail to effectively manage any leadership changes, including organizational and strategic changes, such failure could have a material adverse effect on our ability to successfully attract, motivate and retain highly qualified employees, as well as our business, financial condition, and results of operations.
Removed
In addition, our ability to raise additional capital, including through future at-the-market offerings and other offerings utilizing short-form registration statements on Form S-3, would be substantially impaired. The issuance of additional stock in connection with financings, acquisitions, investments, our stock incentive plans or otherwise will dilute all other stockholders.
Added
If authorizations are required and not granted, our international business could be materially affected. The export authorization process is often time-consuming.
Removed
In addition, any changes to tax rules and regulations or the interpretation of tax rules and regulations could negatively impact our ability to recognize any potential benefits from our NOLs or net unrealized built-in losses. 23 Table of Contents Shareholder activism could cause us to incur significant expense, hinder execution of our business strategy and impact our stock price.
Added
The third-parties with which we outsource certain of our IT functions utilize a variety of systems and cybersecurity capabilities, and such third-parties may not be successful in preventing a breach that exploits a weakness in their cybersecurity systems.
Added
In some cases, we may not be aware of cyber incidents immediately as we rely on such third-parties to inform us of a cyber incident that could affect our information contained in their systems.
Added
In addition, a significant portion of the purchase price of companies we acquire may be allocated to acquired goodwill and other intangible assets, which must be assessed for impairment at least annually.
Added
Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions.
Added
The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets, and other intellectual property protection, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our intellectual property and proprietary rights generally.
Added
Proceedings to enforce our intellectual property and proprietary rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly, could put our patent applications at risk of not issuing, and could provoke third-parties to assert claims against us.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES Our office space is located at 11710 Plaza America Drive, Suite 2000 Reston, VA 20190 USA. The term of the lease extends through December 31, 2023. We are obligated to pay approximately $8,000 per month for office rent.
Biggest changeITEM 2. PROPERTIES Our office space is located at 11710 Plaza America Drive, Suite 2000 Reston, VA 20190 USA. In January 2024, the lease was renewed for the term of January 1, 2024 through December 31, 2024 with a monthly payment of approximately $8,000 per month for office rent.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Removed
To its knowledge, the Company does not have any current pending legal issues or proceedings. For a description of legal proceedings that were resolved by the Company, see the information set under Litigation in Note 5. Commitments and Contingencies of the Notes to our Consolidated Financial Statements in Part II. Item 8.
Added
To our knowledge, the Company does not have any current pending legal issues or proceedings.
Removed
Financial Statements and Supplementary Data, of this Annual Report on Form 10-K. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 24 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeHolders As of March 2, 2023, our common stock was held by approximately 53 stockholders of record, including Cede & Co., the nominee for the Depository Trust & Clearing Corporation, and consequently that number does not include beneficial owners of our common stock who hold their stock in “street name” through their brokers. Dividends We have never paid dividends.
Biggest changeMARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is quoted on the Nasdaq Capital Market under the symbol “LTBR.” Holders As of February 15, 2024, our common stock was held by 52 stockholders of record, including Cede & Co., the nominee for the Depository Trust & Clearing Corporation, and consequently that number does not include beneficial owners of our common stock who hold their stock in “street name” through their brokers.
While any future dividends will be determined by our board of directors after consideration of the earnings and financial condition of the Company and other relevant factors, it is currently expected that available cash resources will be utilized in connection with our ongoing operations for the foreseeable future.
Dividends We have never paid dividends. While any future dividends will be determined by our board of directors after consideration of the earnings and financial condition of the Company and other relevant factors, it is currently expected that available cash resources will be utilized in connection with our ongoing operations for the foreseeable future.
Removed
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is quoted on the Nasdaq Capital Market under the symbol “LTBR”.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe above fuel development strategy is based on the following key assumptions: · funding requirements are met with U.S. government providing most of the necessary fuel development costs; · time estimates for irradiation loop design and construction at ATR can be achieved by the national laboratory complex; · partnership with nuclear power plant and fuel manufacturer for LTA demonstration purposes is achieved in a timely manner and does not delay the assumed start of work; · accelerated fuel qualification methodology developed for Lightbridge Fuel™ is accepted by the NRC as sufficient for the safety justification of the LTAs; · execution of out-of-reactor fuel development activities can be performed in parallel with LTA design; · facilities and personnel for completion of the fuel development work are available when necessary and do not delay the execution of our research and development activities; · by implementation of accelerated burn-up techniques, the irradiation loop at ATR is capable of 50% reduction in irradiation time compared to operating commercial reactor fuel cycle; and · the pilot-scale fuel fabrication facility will be capable of manufacturing LTA quantities of metallic fuel rods to the desired rod length and specification. 28 Table of Contents Operations Review Consolidated Results of Operations The following table presents our operating results as a percentage of revenues for the years indicated (rounded to millions): Years Ended Increase Increase December 31, (Decrease) (Decrease) 2022 2021 Change $ Change % Operating Expenses General and administrative $ 7.5 $ 7.1 $ 0.4 6 % Research and development $ 0.7 $ 1.4 $ (0.7 ) (50 )% Total Operating Expenses $ 8.2 $ 8.5 $ (0.3 ) (4 )% Other Operating Income Distribution from joint venture $ — $ 0.1 $ (0.1 ) (100 )% Contributed services – research and development $ 0.4 $ 0.5 $ (0.1 ) (20 )% Total Other Operating Income $ 0.4 $ 0.6 $ (0.2 ) (33 )% Total Operating Loss $ (7.8 ) $ (7.9 ) $ (0.1 ) (1 )% Other Income $ 0.3 $ 0.1 $ 0.2 200 % Net loss before Income Taxes $ (7.5 ) $ (7.8 ) $ (0.3 ) (4 )% Net Loss $ (7.5 ) $ (7.8 ) $ (0.3 ) (4 )% Operating Expenses General and Administrative Expenses General and administrative expenses consist mostly of compensation and related costs for personnel and facilities, stock-based compensation, finance, human resources, information technology, and fees for consulting and other professional services.
Biggest changeBased on these activities and time estimates, Lightbridge expects to have LTAs of its fuel ready for insertion in a commercial reactor in the 2030s. 29 Table of Contents The above fuel development strategy is based on the following key assumptions: · A large portion of our project funding requirements is met with direct or indirect cash and/or in-kind contributions from government and/or strategic partner and/or other third-party sources; · our expected time estimates for loop availability in the ATR can be achieved by the national laboratory complex; · partnership with nuclear power plant and fuel manufacturer for LTA demonstration purposes is achieved in a timely manner and does not delay the assumed start of work; · potential accelerated fuel qualification methodology (AFQ) that we currently plan to develop for Lightbridge Fuel™ is accepted by the NRC as sufficient for the safety justification of the LTAs; · execution of out-of-reactor fuel development activities can be performed in parallel with LTA design; · facilities and personnel for completion of the fuel development work are available when necessary and do not delay the execution of our research and development activities; · by implementation of accelerated burn-up techniques, the irradiation loop at ATR is capable of 50% reduction in irradiation time compared to operating commercial reactor fuel cycle; and · the pilot-scale fuel fabrication facility will be capable of manufacturing LTA quantities of metallic fuel rods to the desired rod length and specification.
The actual amount of cash we will need to operate is subject to many factors, including, but not limited to, the timing, design and conduct of the R&D work at the DOE’s national laboratories for our fuel along with cost to commercialize our nuclear fuel.
The actual amount of cash we will need to operate is subject to many factors, including, but not limited to, the timing, design and conduct of the R&D work at the DOE’s national laboratories for our fuel along with the cost to commercialize our nuclear fuel.
Discussions are currently ongoing with the INL and PNNL to perform process development activities and establish the capability to manufacture development quantities of fuel rods for irradiation testing. Fabrication of LTAs will require a dedicated pilot-scale fuel fabrication facility. We estimate the major scopes of work to establish a manufacturing capability for LTAs would take 5-8 years to complete.
Discussions are currently ongoing with the INL to perform process development activities and establish the capability to manufacture development quantities of fuel rods for irradiation testing. Fabrication of LTAs will require a dedicated pilot-scale fuel fabrication facility. We estimate the major scopes of work to establish a manufacturing capability for LTAs would take 5-8 years to complete.
Prior period ownership changes, coupled with the Company’s projections of taxable income for the foreseeable future, will substantially limit any future benefit to be derived from our NOLs. See Note 7. Income Taxes of the Notes to our Consolidated Financial Statements included in Part II. Item 8.
Prior period ownership changes, coupled with the Company’s projections of no taxable income for the foreseeable future, will substantially limit any future benefit to be derived from our NOLs. See Note 7. Income Taxes of the Notes to our Consolidated Financial Statements included in Part II. Item 8.
As discussed in more detail under “Forward-Looking Statements” immediately preceding this MD&A, the following discussion contains forward-looking statements that are based on our management’s current expectations, estimates, and projections, which are subject to a number of risks and uncertainties.
As discussed in more detail under “Forward-Looking Statements” preceding this MD&A, the following discussion contains forward-looking statements that are based on our management’s current expectations, estimates, and projections, which are subject to a number of risks and uncertainties.
The Company has an effective shelf registration statement on Form S-3 that was filed with the Securities and Exchange Commission, or SEC, on March 25, 2021, registering the sale of up to $75 million of the Company’s securities and declared effective on April 5, 2021.
The Company has an effective shelf registration statement on Form S-3 that was filed with the Securities and Exchange Commission, or SEC, on March 25, 2021, registering the sale of up to $75 million of the Company’s securities which was declared effective on April 5, 2021.
Loop Irradiation Testing The purpose of the loop irradiation testing of Lightbridge’s metallic fuel rod is to demonstrate the performance and behavior of the fuel rod under prototypic commercial reactor operating conditions typical of PWRs at a power level and burnup accumulation higher than the fuel would experience in normal operation in a commercial power plant.
Loop Irradiation Testing The purpose of the loop irradiation testing of Lightbridge’s metallic fuel rods is to demonstrate the performance and behavior of the fuel rods under prototypic commercial reactor operating conditions typical of PWRs at a power level and burnup accumulation higher than the fuel would experience in normal operation in a commercial power plant.
Our cash balance at December 31, 2022 and as of the date of this filing exceeds our anticipated cash requirements for the next 12 months. There are inherent uncertainties in forecasting the future required R&D or other expenditures in the future.
Our cash balance at December 31, 2023 and as of the date of this filing exceeds our anticipated cash requirements for the next 12 months. There are inherent uncertainties in forecasting the future required R&D or other expenditures in the future.
Lightbridge anticipates that such ‘out-of-pile’ testing to justify the LTA performance will take approximately four years. We expect that the LTA design effort, development of computer modeling and simulation capabilities, and performance of the LTA safety justification will take 8 years.
Lightbridge anticipates that such ‘out-of-pile’ testing to justify the LTA performance will take approximately four years. We expect that the LTA design effort, development of computer modeling and simulation capabilities, and performance of the LTA safety justification will take eight years.
Along with leveraging the AFQ approach, uranium-zirconium (U-Zr) fuel technology has the benefits of being previously demonstrated in operating icebreaker reactors and several aspects of the performance of the fuel have been demonstrated.
Along with leveraging the AFQ approach, uranium-zirconium fuel technology has the benefits of being previously demonstrated in operating icebreaker reactors and several aspects of the performance of the fuel have been demonstrated.
Accordingly, there is high potential for budget variances in the current cost projections and fuel development timelines of our current planned operations over the fuel development period. We will continue to utilize our ATM (as defined below) to finance our future R&D and corporate activities.
Accordingly, there is high potential for budget variances in the current cost projections and fuel development timelines of our current planned operations over the fuel development period. We will continue to utilize our ATM to finance our future R&D and corporate activities.
The data obtained from this program will be a fundamental component of Lightbridge’s accelerated fuel qualification approach described below as it will be used to inform and develop the physics-based models and simulations of the fuel rod behaviors. c.
The data obtained from this program will be a fundamental component of Lightbridge’s accelerated fuel qualification approach described below as it will be used to inform and develop the physics-based models and simulations of the fuel rod behaviors. 28 Table of Contents c.
Once other anticipated agreements are finalized or other future R&D agreements are entered into and the future R&D costs are known, we expect to forecast a significantly higher level of future required R&D expenses and higher negative monthly cash flows from operations in the future.
Once other anticipated agreements are finalized or other future R&D agreements are entered into and the future R&D expenses are known, we expect to incur a significantly higher level of future required R&D expenses and higher negative monthly cash flows from operations in the future.
Computer modeling and simulation has increasingly been used in support of fuel qualification efforts, but the cyclical approach continues to be the default methodology. In order to shorten the timeframe for fuel qualification, advanced nuclear fuel developers are now taking an approach that leverages significant improvements in computational capability in a methodology referred to as Accelerated Fuel Qualification (AFQ).
Computer modeling and simulation has increasingly been used in support of fuel qualification efforts, but the cyclical approach continues to be the default methodology. Advanced nuclear fuel developers are now taking an approach that leverages significant improvements in computational capability in a methodology referred to as Accelerated Fuel Qualification (AFQ).
Such testing is expected to provide information of sufficient detail to validate the performance of individual fuel rods such that their behavior in normal operating conditions of a regulated nuclear power plant would be sufficiently well understood to request a license amendment from the NRC for operation of a lead test assembly.
Such testing is expected to provide information of sufficient detail to validate the performance of individual fuel rods such that their behavior in normal operating conditions of a NRC-regulated nuclear power plant would be sufficiently well understood to request a license amendment from the NRC for operation of a LTA.
The primary source of cash available to us for the next 12 months, in addition to cash and cash equivalents on hand, is the potential funding from equity issuances from ATM equity offering sales agreement, as amended, with Stifel, Nicolaus & Company, Incorporated.
Our current source of cash available to us for the next 12 months, in addition to cash and cash equivalents on hand, is the potential funding from equity issuances pursuant to the ATM equity offering sales agreement, as amended, with Stifel, Nicolaus & Company, Incorporated.
This will provide a physical demonstration of the capabilities of the fuel rod in order to ensure reactor safety.
This will provide a physical demonstration of the capabilities of the fuel rods in order to ensure reactor safety.
Professional services are principally comprised of legal, audit, strategic advisory services, and outsourcing services. Total general and administrative expenses increased by $0.4 million for the year ended December 31, 2022, as compared to the year ended December 31, 2021.
Professional services are principally comprised of legal, audit, strategic advisory services, and outsourcing services. Total general and administrative expenses decreased by $0.4 million for the year ended December 31, 2023, as compared to the year ended December 31, 2022.
The following table provides detailed information about our net cash flows for the years ended December 31, 2022 and 2021: Cash Flow Year Ended December 31, 2022 2021 (rounded in millions) Net cash used in operating activities $ (6.7 ) $ (11.0 ) Net cash used in investing activities $ — $ — Net cash provided by financing activities $ 10.9 $ 14.2 Net cash inflow $ 4.2 $ 3.2 Operating Activities Cash used in operating activities decreased by $4.3 million in 2022 as compared to 2021.
The following table provides detailed information about our net cash flows for the years ended December 31, 2023 and 2022 (rounded in millions): Cash Flow Year Ended December 31, 2023 2022 Net Cash Used in Operating Activities $ (6.5 ) $ (6.7 ) Net Cash Used in Investing Activities — — Net Cash Provided by Financing Activities 6.2 10.9 Net Cash (Outflow) Inflow $ (0.3 ) $ 4.2 Operating Activities Cash used in operating activities decreased by $0.2 million in 2023 as compared to 2022.
If we are unable to obtain government funding that meets our future R&D cash requirements, we will need to seek other funding, which may include the issuance of additional shares of the Company’s common stock, if available. This will result in dilution to our existing stockholders.
If we are unable to obtain such funding and/or in-kind support that meets our future R&D cash requirements, we will need to seek other funding, which may include the issuance of additional shares of the Company’s common stock, if available. This will result in dilution to our existing stockholders.
Under current SEC regulations, if at any time our public float is less than $75.0 million, and for so long as our public float remains less than $75.0 million, the amount we can raise through primary public offerings of securities in any twelve-month period using shelf registration statements is limited to an aggregate of one-third of our public float, which is referred to as the baby shelf rules.
Under current SEC regulations set forth under General Instruction I.B.6. of Form S-3, if at any time our public float is less than $75.0 million, and for so long as our public float remains less than $75.0 million, the amount we can raise through primary public offerings of securities in any twelve-month period using shelf registration statements is limited to an aggregate of one-third of our public float, which is referred to as the baby shelf rules.
This MD&A consists of the following sections: · Overview of Our Business and Recent Developments – a general overview of our business and updates; · Critical Accounting Policies and Estimates – a discussion of accounting policies that require critical judgments and estimates; · Operations Review – an analysis of our consolidated results of operations for the periods presented in our consolidated financial statements; and · Liquidity, Capital Resources, and Financial Position – an analysis of our cash flows, and an overview of our financial position.
This MD&A consists of the following sections: · Overview of Our Business and Development of Lightbridge Fuel™ - a general overview of our business and updates; · Critical Accounting Estimates - a discussion of critical judgments and estimates; · Operations Review - an analysis of our consolidated results of operations for the periods presented in our consolidated financial statements; and · Liquidity, Capital Resources, and Financial Position - an analysis of our cash flows and an overview of our financial position.
Our long-term cash requirements are currently projected to be an average of $10 million of outside R&D expenditures per year over the next 10-15 years.
Our long-term cash requirements are currently estimated to be an average of $10.0 million of outside or third-party R&D expenditures per year over the next 10-15 years.
We reviewed all sources of income for purposes of recognizing the deferred tax assets and concluded a full valuation allowance for 2022 and 2021 was necessary. Therefore, we did not have a provision for taxes for both years ended December 31, 2022 and 2021.
Provision for Income Taxes We incurred a pre-tax net loss for both 2023 and 2022. We reviewed all sources of income for the purpose of recognizing the deferred tax assets and concluded a full valuation allowance for 2023 and 2022 was necessary. Therefore, we did not have a provision for taxes for both years ended December 31, 2023 and 2022.
The AFQ approach combines physics-informed modeling and simulation coupled with targeted physical testing such that the overall fuel qualification effort is reduced in terms of cost and time, with a goal of fuel qualification taking approximately 15 years. Lightbridge intends to leverage the AFQ methodologies to qualify its advanced fuels.
The AFQ approach combines physics-informed modeling and simulation coupled with targeted physical testing such that the overall fuel qualification effort could be significantly reduced in terms of cost and time. Lightbridge intends to leverage the AFQ methodologies to qualify its advanced fuels.
We filed another prospectus supplement, dated November 9, 2022, with the SEC pursuant to which we may offer and sell shares of common stock having an aggregate offering price of up to $20.0 million from time to time, through the ATM.
We filed a prospectus supplement, dated April 4, 2023, with the SEC pursuant to which we may offer and sell shares of common stock having an aggregate offering price of up to $17.9 million from time to time, through the ATM.
Cash provided by our ATM facility was $11.0 million (sale of approximately 1.9 million common shares) and $14.8 million (sale of approximately 2.0 million common shares) for the years 2022 and 2021, respectively.
Cash provided by our ATM facility was $6.4 million (sale of approximately 1.5 million common shares) and $11.0 million (sale of approximately 1.9 million common shares) for the years 2023 and 2022, respectively.
Other Income There was an increase in other income of $0.2 million due to an increase in interest income generated from the interest earned from the purchase of treasury bills and from our bank savings account for the year ended December 31, 2022, as compared to the year ended December 31, 2021.
Other Income There was an increase in other income of $0.8 million due to rising treasury bill interest rates over the past year which resulted in an increase in interest income earned from the purchase of treasury bills and from our bank savings account for the year ended December 31, 2023, as compared to the year ended December 31, 2022.
Research and Development Research and development expenses consist primarily of compensation and related fringe benefits including stock-based compensation and related allocable overhead costs for the research and development of our fuel and contributed services - research and development for the R&D work performed under the GAIN vouchers.
Research and Development (R&D) R&D expenses consist primarily of costs associated with our CRADA and SPP agreements with INL for the research and development of our fuel, employee compensation and related fringe benefits including stock-based compensation and related allocable overhead costs for the research and development of our fuel and contributed services - research and development for the work performed under the Gateway for Accelerated Innovation in Nuclear (GAIN) vouchers.
The primary potential sources of cash that may be available to us are as follows: · equity or debt investment from third party investors in Lightbridge; · collaboration with potential industry partners; and · strategic investment and U.S. government funding to support the remaining R&D activities required to continue the development of our fuel products and move them to a commercial stage. 31 Table of Contents In support of our long-term business with respect to our fuel technology business, we endeavor to create strategic alliances with other parties to support the remaining R&D activities that is required to further enhance and complete the development of our fuel products to a commercial stage.
The primary potential sources of cash that may be available to us are as follows: · equity or debt investment from third-party investors in Lightbridge; · collaboration with potential industry partners; and · strategic investment and/or government funding to support the remaining R&D activities required to continue the development of our fuel products and move them to a commercial stage.
Management believes that public or private equity investments may be available in the future, however adverse market conditions, in our common stock price and trading volume, as well as other factors could substantially impair our ability to raise capital in the future and continue developing our nuclear fuel.
Management believes that public or private equity investments may be available in the future; however adverse market conditions, in our common stock price and trading volume, as well as other factors could substantially impair our ability to raise capital in the future and continue developing our nuclear fuel. 32 Table of Contents Short-Term and Long-Term Liquidity Sources Our current source of liquidity is cash raised from our ATM facility.
Short-Term and Long-Term Liquidity Sources As discussed above, we will seek new financing bringing us additional sources of capital, depending on the capital market conditions of our common stock. There can be no assurance that these additional sources of capital will be made available to us.
As discussed above, we will seek new financing in order to bring us additional sources of capital, depending on the capital market conditions of our common stock. There can be no assurance that these additional sources of capital will be made available on terms acceptable to us, or at all.
The framework agreements use an innovative structure and consist of an “umbrella” Strategic Partnership Project Agreement (SPP) and an “umbrella” Cooperative Research and Development Agreement (CRADA), each with Battelle Energy Alliance, LLC (BEA), the DOE’s operating contractor for INL, with an initial duration of seven years.
The framework agreements use an innovative structure that consists of an “umbrella” Strategic Partnership Project Agreement (SPP) and an “umbrella” Cooperative Research and Development Agreement (CRADA), each with BEA, with an initial duration of seven years.
We currently project a negative cash flow from our operations for both our general and administrative and R&D expenses, for total expected expenditures of $13.1 million to $15.7 million for the next 12 to 15 months, respectively. Our R&D expenses are expected to increase over the next 12-15 months.
We have approximately $28.2 million of working capital as of the date of this filing. We currently project a negative cash flow from our operations for both our general and administrative and R&D expenses, resulting in total expected expenditures of approximately $13.8 million for the next 12 months. Our R&D expenses are expected to increase over the next 12-15 months.
Decreases in operating cash flows due to the net increase in operating assets and liabilities include an increase in prepaid project costs of $0.3 million offset by a net increase in accounts payable and accrued expenses of $0.2 million. Investing Activities Net cash used in our investing activities was insignificant for the years ended December 31, 2022 and 2021.
The decrease was primarily due to changes in net operating assets and liabilities, which were driven by an increase in prepaid assets of $0.2 million, offset by an increase in accounts payable and accrued liabilities of $0.4 million. Investing Activities Net cash used in our investing activities was insignificant for the years ended December 31, 2023 and 2022.
Our future business operations are dependent on budgetary constraints due primarily to market conditions and the uncertainty of future liquidity and capital resources available to us to conduct our future R&D activities. Other Operating Income Total other operating income decreased $0.2 million for the year ended December 31, 2022, as compared to the year ended December 31, 2021.
Our future business operations are dependent on budgetary constraints due primarily to market conditions and the uncertainty of future liquidity and capital resources available to us to conduct our future R&D activities.
Contractual Obligations and Commitments On December 9, 2022, we entered into initial project task statements with BEA, the operating contractor of INL, in collaboration with the DOE, which releases set forth the initial scopes of work and funding commitments under the umbrella agreements, each dated September 27, 2022, between the Company and BEA.
Cash used during the years 2023 and 2022 related to the payment of withholding taxes on the net share settlement of equity awards was $0.2 million and $0.1 million, respectively. 33 Table of Contents Contractual Obligations and Commitments On December 9, 2022, we entered into an initial project task statements with BEA, the operating contractor of INL, in collaboration with the DOE, which statements set forth the initial scopes of work and funding commitments under the umbrella agreements, each dated September 27, 2022, between the Company and BEA.
Expanding that pilot-scale fuel fabrication facility from LTA capability to batch reload quantities would require a substantial additional capital investment in the manufacturing facility and equipment. These estimates assume sufficient funding availability and that the project receives prioritization by the DOE and US Nuclear Regulatory Commission (NRC). b.
Expanding that pilot-scale fuel fabrication facility from LTA capability to batch reload quantities would require a substantial additional capital investment in the manufacturing facility and equipment.
The ATR currently has limited irradiation loop test facilities and the performance of the above-mentioned test for Lightbridge Fuel™ may require installation of a new test loop with increased heat removal capability to enable the desired test conditions. 27 Table of Contents We expect the performance of the irradiation test to take three years of in-reactor time plus an additional one year for post-irradiation examination (PIE), wherein analysis of the fuel rod performance and behavior is performed, from the time when the additional test loop becomes available. d.
We expect the performance of the irradiation test to take three years of in-reactor time plus an additional one year for post-irradiation examination, wherein analysis of the fuel rod performance and behavior is performed, from the time when the additional test loop becomes available. d.
Although we expect this ATM facility to continue to be a significant source of working capital for the Company in 2023, there is no assurance that an ATM financing arrangement will be available to us in the future (see liquidity outlook section below). Please also see Note 8.
Although we expect this ATM facility to continue to be a source of working capital for the Company in 2024, there is no assurance that an ATM financing arrangement will be available to us in the future. See Note 8. Stockholders’ Equity and Stock-Based Compensation of the Notes to the Consolidated Financial Statements included in Part II. Item 8.
We anticipate that the initial phase of work under the two agreements that has been released will culminate in irradiation testing in the Advanced Test Reactor (ATR) of our fuel material coupons, using enriched uranium supplied by the DOE. The initial phase of work aims to generate irradiation performance data for Lightbridge’s delta-phase uranium-zirconium alloy relating to various thermophysical properties.
We anticipate that the initial phase of work under the two agreements that has been released will culminate in casting and extrusion of unclad fuel material samples using enriched uranium supplied by the DOE that will subsequently be inserted for irradiation testing in the Advanced Test Reactor (ATR) at INL.
We have no debt or lines of credit and we have financed our operations to date through the sale of our preferred stock and common stock.
Financial Statements and Supplementary Data of this Annual Report on Form 10-K for information regarding our ATM financing. We have no debt or lines of credit and we have financed our operations to date through the sale of our preferred stock and common stock.
Our net cash used in operating activities for the year ended December 31, 2022 was $6.7 million and our cash flow projections indicate that we will have continued negative cash flows for the foreseeable future. We are not profitable, and we cannot provide any assurance that we will become profitable in the future.
We raised net proceeds of $6.4 million from the sale of approximately 1.5 million shares of common stock during the year ended December 31, 2023. Our net cash used in operating activities for the year ended December 31, 2023 was $6.5 million and our cash flow projections indicate that we will have continued negative cash flows for the foreseeable future.
We will also need to receive substantial U.S. government support in the form of grants throughout our nuclear fuel R&D period in order to fund our R&D efforts in the future.
We will need to receive substantial funding and in-kind support from government and/or strategic partners and/or other third-party sources throughout our nuclear fuel R&D development period in order to fund our ongoing R&D efforts in the future.
This decrease was due to a decrease in cash provided by our ATM facility of $3.8 million, a decrease in cash provided by the exercise of stock options of $0.2 million, offset by decrease in net share settlement of equity awards for the payment of withholding taxes of $0.7 million.
Financing Activities Cash provided by financing activities decreased by $4.7 million. This decrease was due to a decrease in the net proceeds received from the issuance of common stock under our at-the-market (ATM) facility in fiscal year 2023 of $4.6 million and an increase in net share settlement of equity awards for the payment of withholding taxes of $0.1 million.
Our actual results may differ materially from those discussed in these forward-looking statements because of the risks and uncertainties inherent in future events. 25 Table of Contents Overview of Our Business and Recent Developments Our Business Our Company’s goal is to impact in a meaningful way the world’s climate and energy problems.
Risk Factors . 26 Table of Contents Overview of Our Business and Recent Developments Our Business Our Company’s goal is to impact in a meaningful way the world’s climate and energy problems.
As of the date of this filing, our calculated public float is below $75.0 million and we will be subject to the baby shelf rules for any offerings conducted on our current shelf registration statement.
As of the date of this filing, we are subject to the baby shelf rules for any offerings conducted on our current shelf registration statement, and therefore may be limited on the amount of funding available under this Form S-3 shelf registration statement in the future.
We anticipate that subsequent phases of work under the two umbrella agreements that have not yet been released will include post-irradiation examination of the irradiated fuel material coupons, loop radiation testing in the ATR, and post-irradiation examination of one or more uranium-zirconium fuel rodlets, as well as transient experiments at Transient Reactor Test Facility (TREAT) at INL.
We plan to negotiate subsequent phases of work under the two umbrella agreements that have not yet been released that may include post-irradiation examination of the irradiated fuel material coupons, loop irradiation testing in the ATR, and post-irradiation examination of one or more uranium-zirconium fuel rodlets, as well as transient experiments in the Transient Reactor Test Facility at INL. 27 Table of Contents In 2023, we worked with INL to complete and issue a Quality Implementation Plan (QIP) for our collaborative project at INL which was an essential first step to ensure all future work performed at INL on the project would meet the U.S. nuclear industry quality assurance requirements.
Total R&D expenses decreased by $0.7 million for the year ended December 31, 2022, as compared to the year ended December 31, 2021.
Total R&D expenses increased by $1.2 million for the year ended December 31, 2023, as compared to the year ended December 31, 2022 due to the increase in R&D activities related to the development of our fuel.
This decrease was primarily due to a decrease in outside R&D expenses of $0.3 million, a decrease in allocated employee compensation and employee benefits of $0.1 million and a decrease in other research and development expenses of $0.3 million. 29 Table of Contents We currently expect to invest a total of approximately $6.5 million in the research and development of our nuclear fuel over the next 12 to 15 months.
This increase was offset by a decrease of $0.3 million primarily related to the GAIN voucher work recorded as research and development expenses in 2022 that was completed in the first quarter of 2023. We currently anticipate investing approximately $6 million to $8 million in the R&D of our nuclear fuel over the next 12 to 15 months.
This discussion contains forward-looking statements that are based on our management’s current expectations, estimates, and projections for our business, which are subject to a number of risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Forward-Looking Statements” and Part I. Item 1A.
Our actual results may differ materially from those discussed in these forward-looking statements because of the risks and uncertainties inherent in future events, including those set forth under “Forward-Looking Statements” and Part I. Item 1A.
The NRC review and approval of the license amendment for LTA insertion is expected to require two years after the license amendment is submitted. Based on these activities and time estimates, Lightbridge expects to have LTAs of its fuel ready for insertion in a commercial reactor in the 2030s.
The NRC’s review and approval of the license amendment for LTA insertion is expected to require two years after the license amendment is submitted.
We expect execution of such a loop irradiation test to be performed in the ATR at INL.
We expect execution of such a loop irradiation test to be performed in the ATR at INL. The ATR currently has limited irradiation loop test facilities; however, installation of the new so-called “I-loops” will increase the loop irradiation capacity of ATR for performing tests on Lightbridge Fuel™ in the desired test conditions.
These long- term cash requirements for future planned operations to develop and commercialize our nuclear fuel, including any additional expenditures that may result from unexpected developments, will require us to receive government support in the future.
In order to meet these long-term cash requirements for future planned operations to develop and commercialize our nuclear fuel, including any additional expenditures that may result from unexpected developments, it will be necessary for our project to receive direct or indirect funding and/or in-kind support from government and/or strategic partners and/or other third-party sources. 31 Table of Contents At December 31, 2023, we had cash and cash equivalents of $28.6 million, as compared to $28.9 million at December 31, 2022, a decrease of $0.3 million.
There was contributed services - research and development from the GAIN program of $0.4 million and $0.5 million for the years ended December 31, 2022 and 2021, respectively, with a charge to R&D expenses and a corresponding amount recorded to contributed services - research and development.
Contributed services - research and development are recorded with a charge to R&D expenses and a corresponding amount recorded to contributed services - research and development.
Among other objectives, the project will simulate the fuel and safety performance of Lightbridge Fuel™ in an SMR designed by NuScale Power and provide a scoping analysis of longer-term advanced fuel forms to improve the safety and economics of SMRs.
The study led by MIT and funded by DOE relates to evaluation of accident tolerant fuels in various SMRs. The project aims to simulate the fuel and safety performance of Lightbridge Fuel™ for the NuScale SMR and provide scoping analysis to improve the safety and economics of water-cooled SMRs.
Our ongoing operations are currently being financed primarily by raising new equity capital. Recent Developments In the second half of 2022, we entered into agreements with Idaho National Laboratory (INL), in collaboration with the United States Department of Energy (DOE) to support the development of Lightbridge Fuel™.
Our ongoing operations are currently being financed primarily by raising new equity capital. Recent Developments FEED Study with Centrus Energy for a Lightbridge Pilot Fuel Fabrication Facility On December 5, 2023 we entered into an agreement with Centrus Energy Corp.
Stockholders’ Equity and Stock-Based Compensation of the Notes to the Consolidated Financial Statements included in Part II. Item 8. Financial Statements and Supplementary Data , of this Annual Report on Form 10-K for information regarding our ATM and prior financings.
Basis of Presentation, Summary of Significant Accounting Policies, and Nature of Operations, in the Notes to the Consolidated Financial Statements included in Part II. Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K. There were no critical accounting estimates at December 31, 2023 and 2022. Recent Accounting Standards and Pronouncements Refer to Note 1.
The data will support fuel performance modeling and regulatory licensing efforts for the commercial deployment of Lightbridge Fuel™.
The initial phase of work aims to generate irradiation performance data for Lightbridge’s delta-phase uranium-zirconium alloy relating to various thermophysical properties. The data, which will be obtained during post-irradiation examination work to be released under a future Project Task Statement, will support fuel performance modeling and regulatory licensing efforts for commercial deployment of Lightbridge Fuel™.
These increases were offset by a decrease in professional fees of $0.4 million relating to fees incurred in connection with the arbitration matter that was settled in 2021, that were not repeated during the year ended December 31, 2022. Total stock-based compensation included in general and administrative expenses was $0.8 million for the years ended December 31, 2022 and 2021.
The decrease of $0.4 million was primarily due to a decrease in employee compensation and employee benefits of $0.4 million, due to the increase in the time allocation percentage of G&A labor costs to research and development expenses, a decrease in consulting expenses of $0.1 million, a decrease in insurance expense of $0.1 million, a decrease in dues and subscriptions of $0.1 million, and a decrease in promotion expenses of $0.1 million, offset by an increase in stock-based compensation of $0.4 million, which was due to the partial vesting of restricted stock awards granted in 2022. 30 Table of Contents Total stock-based compensation included in general and administrative expenses was $1.1 million for the years ended December 31, 2023 and 2022.
Removed
The DOE’s Office of Nuclear Energy has established the Gateway for Accelerated Innovation in Nuclear (GAIN) program to provide the nuclear community with access to the technical, regulatory, and financial support necessary to expedite moving new or advanced nuclear technologies toward commercialization, while ensuring the continued safe, reliable, and economic operation of the existing nuclear reactor fleet.
Added
(Centrus Energy) to conduct a front-end engineering and design (FEED) study to construct a Lightbridge Pilot Fuel Fabrication Facility (LPFFF) to manufacture Lightbridge Fuel™ using high-assay low-enriched uranium (HALEU) at the American Centrifuge Plant in Piketon, Ohio, the only HALEU production plant in the world outside of Russia.
Removed
We were awarded our first GAIN voucher in 2019 for the experiment design for irradiation of fuel material coupons of Lightbridge metallic fuel in the ATR at INL. On April 22, 2020, we entered into a CRADA with BEA, the DOE’s operating contractor at INL.
Added
The FEED study will identify infrastructure and licensing requirements as well as the estimated cost and construction schedule for the LPFFF. Centrus Energy’s wholly-owned subsidiary, American Centrifuge Operating, LLC, will lead the study. The work is expected to be completed in 2024 at a fixed price of approximately $0.5 million.
Removed
The project commenced in the second quarter of 2020 and was originally expected to be completed in the second quarter of 2021. However, because of project staffing issues at INL related to the laboratory’s COVID-19 restrictions and U.S. export control matters, the project was completed during the third quarter of 2021.
Added
Engineering Study of Lightbridge Fuel™ for use in Canada Deuterium Uranium (CANDU) reactors On October 16, 2023, we engaged Institutul de Cercetări Nucleare Pitești, a subsidiary of Regia Autonoma Tehnologii pentru Energia Nucleara in Romania to perform an engineering study to assess the compatibility and suitability of Lightbridge Fuel™ for use in CANDU reactors.
Removed
The total project amount recorded as contributed services – research and development was approximately $0.5 million. This experiment design forms the basis of our current and future efforts with the INL. The DOE awarded us a second voucher from the GAIN program to support development of Lightbridge Fuel™ in collaboration with Pacific Northwest National Laboratory (PNNL) on March 25, 2021.
Added
This assessment will cover key areas including mechanical design, neutronics analysis, and thermal and thermal-hydraulic evaluations. The findings from this engineering study will play an important role in guiding future economic evaluations and navigating potential regulatory licensing-related issues for potential use of Lightbridge Fuel™ in CANDU reactors.
Removed
The scope of the project is to demonstrate Lightbridge’s nuclear fuel casting process using depleted uranium, a key step in the manufacture of Lightbridge Fuel™. On July 14, 2021, the Company executed a CRADA with the Battelle Memorial Institute, Pacific Northwest Division, the operating contractor of the PNNL, in collaboration with the DOE.
Added
The work is expected to be completed in 2024 at a fixed price of approximately $0.2 million. HALEU Consortium Membership To support establishment of domestic HALEU infrastructure, the DOE announced on December 7, 2022 the creation of a HALEU Consortium.
Removed
The project commenced in the third quarter of 2021. In December 2022, PNNL completed a contract extension with the Company for one month to complete the final report related to this PNNL GAIN voucher. The period of performance was extended to January 31, 2023.
Added
According to the DOE, the purposes of the HALEU Consortium include: (i) providing the Secretary of Energy HALEU demand estimates for domestic commercial use, (ii) purchasing HALEU made available to members for commercial use under the program, (iii) carrying out demonstration projects using HALEU under the program, and (iv) identifying actionable opportunities to improve the reliability of the HALEU supply chain.
Removed
The work under this contract was completed in 2022, and a final report was issued by PNNL on January 31, 2023. The total project value was $0.7 million, with three-quarters of this amount provided by the DOE for the scope performed by PNNL.
Added
On December 15, 2022, the Company submitted a formal request to the DOE to join the HALEU Consortium to mitigate HALEU supply risk. On January 12, 2023, the Company received written confirmation from the DOE of Lightbridge’s membership in the HALEU Consortium. HALEU is a key component necessary for the fabrication and operation of Lightbridge Fuel™ in light water reactors.
Removed
Under this GAIN voucher, we worked with PNNL to develop a reliable and repeatable casting process utilizing its existing equipment. As part of the scope, several castings were performed and the cast ingots analyzed.
Added
Idaho National Laboratory Agreements In December 2022, Lightbridge entered into agreements with Battelle Energy Alliance, LLC (BEA), the DOE’s operating contractor for Idaho National Laboratory (INL), to support the development of Lightbridge Fuel™.
Removed
In an iterative process, the casting methodology was modified based on the characterization results as part of process demonstration to achieve acceptable results with PNNL’s existing equipment. The results of this work will help to inform a final process suitable to produce fuel material coupons for our upcoming irradiation tests.
Added
Additionally, we worked with INL to demonstrate casting of delta-phase uranium-zirconium ingots with depleted uranium using existing INL equipment. As part of that effort, we cast several laboratory-scale ingots using depleted uranium and zirconium alloy materials.
Removed
In June 2022, Lightbridge Fuel™ was selected to participate in a study led by the Massachusetts Institute of Technology (MIT to investigate the performance and economics of accident tolerant fuels for light water cooled small modular reactors (SMRs).
Added
Our next step is to cast additional ingots using depleted uranium and zirconium alloy materials and conduct initial extrusions from those ingots in the next several months at INL. Nuclear Energy University Program Awards We are working with Texas A&M University (TAMU), NuScale Power, and Structural Integrity Associates on a 3-year study led by TAMU.

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