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Item 9A. Controls and Procedures

2025-03-03 compared with 2024-03-04 · 284 added, 261 removed, 414 unchanged (57% of the section changed)

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Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and CFO, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2023 (as such term is defined in Rule 13a-15(e) under the Exchange Act).

Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and CFO, as appropriate to allow timely decisions regarding required disclosure.

Our management, with the participation of our CEO and CFO, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2024 (as such term is defined in Rule 13a-15(e) under the Exchange Act).

Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Based upon this evaluation as of December 31, 2023, our disclosure controls and procedures were not effective due to the material weakness described below.

Based upon this evaluation as of December 31, 2024, our disclosure controls and procedures were effective.

Management ’ s Annual Report on Internal Control over Financial Reporting

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Management has assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024, utilizing the criteria in the Committee of Sponsoring Organizations of the Treadway Commission’s Internal Control-Integrated Framework (2013).

Based on its assessment as of December 31, 2023, our management determined that the Company’s internal control over financial reporting was not effective due to the material weakness described below.

Management determined that there was a material weakness related to the design of our information technology general controls (ITGC) over logical access to key information systems used in the financial reporting process, resulting in certain segregation of duties conflicts.

Based on this assessment, management has concluded that the Company’s internal control over financial reporting was effective as of December 31, 2024.

Remediation of Previously Reported Material Weakness

As disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023, Management determined that there was a material weakness related to the design of our information technology general controls (ITGC) over logical access to key information systems used in the financial reporting process, resulting in certain segregation of duties conflicts.

Additionally, certain business process controls that are dependent on information from these systems were also not effective.

Remediation Plan

The Company’s management, under the oversight of the Audit Committee, has undertaken measures to remediate these deficiencies.

Management, under the oversight of the Audit Committee, remediated this material weakness by December 31, 2024.

This includes enhancing the design of logical access controls to ensure appropriate segregation of duties through improved internal documentation and monitoring activities.

Management began to implement these remedial steps during the fourth quarter of fiscal 2023 by removing privileged access.

The material weakness will not be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are designed and operating effectively.

Notwithstanding the material weakness described above, there have been no restatements of prior period financial statements, and no changes in previously released financial results were required as a result of the material weakness.

Remediation of Previously Reported Material Weakness

As previously reported, we did not maintain effective controls over the review of accounts payable.

During 2023, we implemented remediation plans to address this material weakness by designing and implementing processes and controls over the timely identification, recording, and review of accounts payable.

Management has concluded, through testing, that these controls are designed and operating effectively as of December 31, 2023, and the material weakness has been effectively remediated.

Management also removed privileged access to accounting software and implemented a semi-annual internal review of logical access to the accounting software used in the financial reporting process.

Management has concluded through testing that these new implemented controls are designed and operating effectively as of December 31, 2024 and the material weakness has been effectively remediated.

Changes in Internal Control Over Financial Reporting

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Information required by Item 14 of Part III will be included in our Proxy Statement relating to the 2025 Annual Meeting of Stockholders and is incorporated herein by reference.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Documents filed as part of this report.

The following financial statements of Lightbridge Corporation, supplemental information and report of independent registered public accounting firm are included in this Form 10-K:

Consolidated Balance Sheets at December 31, 2023 and 2022

Consolidated Statements of Operations for the Years Ended December 31, 2023 and 2022

Consolidated Statements of Cash Flows for the Years Ended December 31, 2023 and 2022

Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2023 and 2022

Notes to Consolidated Financial Statements

Report of BDO USA, P.C.

dated March 4, 2024 on the Company’s financial statements filed as a part hereof for the fiscal years ended December 31, 2023 and 2022.

The independent registered public accounting firm’s consent with respect to this report appears in Exhibit 23 of this Annual Report on Form 10-K.

All schedules have been omitted because they are not required, not applicable or the information is otherwise included.

At-the-Market Equity Offering Sales Agreement, dated May 28, 2019, by and between Lightbridge Corporation and Stifel, Nicolaus & Company, Incorporated (incorporated by reference to Exhibit 1.1 to the Form 8-K filed by the Company on May 28, 2019).

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1 to the At-the-Market Equity Offering Sales Agreement, dated May 28, 2019, by and between Lightbridge Corporation and Stifel, Nicolaus & Company, Incorporated (incorporated by reference to Exhibit 1.1 to the Form 8-K filed by the Company on April 9, 2021).

Amendment No.

2 to the At-the-Market Equity Offering Sales Agreement, dated May 8, 2024, by and between Lightbridge Corporation and Stifel, Nicolaus & Company, Incorporated (incorporated by reference to Exhibit 1.1 to the Form 10-Q filed by the Company on May 10, 2024).

Articles of Incorporation of the Company, as amended through October 27, 2022 (incorporated by reference to Exhibit 3.1 to the Form 10-K filed by the Company on March 30, 2023).

Amended and Restated Bylaws of the Company, as amended through November 4, 2021 (incorporated by reference to Exhibit 3.1 to the Form 10-Q filed by the Company on November 8, 2021).

Description of Securities (incorporated by reference to Exhibit 4.2 to the Form 10-K filed by the Company on March 31, 2022).

Certificate of Designation of Series X Preferred Stock (incorporated by reference to Exhibit 3.2 to the Form 8-K filed by the Company on March 3, 2025).

Description of Securities.

Specimen Certificate for Company’s Common Stock (incorporated by reference to Exhibit 4.1 to the Company’s registration statement on Form S-3 filed on April 1, 2013, File No.

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Project Task Statement under the Cooperative Research and Development Agreement, dated December 9, 2022, between the Company and Battelle Energy Alliance, LLC (incorporated by reference to Exhibit 10.18 to the Form 10-K filed by the Company on March 30, 2023).

Modification No.

2 to the Project Task Statement, dated March 25, 2024, under the Strategic Partnership Project Agreement, dated December 9, 2022, as amended on May 23, 2023, by and between Lightbridge Corporation and Battelle Energy Alliance, LLC (incorporated by reference to Exhibit 10.1 to the Form 10-Q filed by the Company on May 10, 2024).

Modification No.

3 to the Project Task Statement, dated October 24, 2024, under the Strategic Partnership Project Agreement, dated December 9, 2022, as amended on May 23, 2023 and March 26, 2024, by and between Lightbridge Corporation and Battelle Energy Alliance, LLC (incorporated by reference to Exhibit 1.01 to the Form 8-K filed by the Company on October 25, 2024).

Modification No.

3 to the Project Task Statement, dated January 16, 2025, under the Cooperative Research and Development Agreement, dated December 9, 2022, by and between Lightbridge Corporation and Battelle Energy Alliance, LLC.

(incorporated by reference to Exhibit 10.1 to the Form 8-K filed by the Company on January 17, 2025).

Subscription and Investment Representation Agreement, dated February 27, 2025, by and between the Company and the Purchaser (incorporated by reference to Exhibit 10.1 to the Form 8-K filed by the Company on March 3, 2025).

Insider Trading Policy.

Subsidiaries of the Company (incorporated by reference to Exhibit 21.1 to the Form 10-K filed by the Company on March 15, 2016).

Consent of BDO USA, P.C.

Consent of Independent Registered Public Accounting Firm

Power of Attorney (Included on the signature page hereto).

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Section 1350 Certifications.

Incentive Compensation Recovery Policy .

Incentive Compensation Recovery Policy (incorporated by reference to Exhibit 97.1 to the Form 10-K filed by the Company on March 4, 2024).

The following materials from Lightbridge Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, formatted in Inline eXtensible Business Reporting Language (XBRL):

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LIGHTBRIDGE CORPORATION

CONSOLIDATED BALANCE SHEETS

C ONSOLIDATE D BALANCE SHEETS

Current Assets

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Total Other Operating Income

Total Operating Loss

Operating Loss

( 13,059,497 )

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Shares issued, net of share settlement for withholding taxes paid upon vesting of restricted stock awards

Shares issued - registered offerings - net of offering costs

Shares issued to consultant & directors for services

Shares issued - registered offerings - net of offering costs of $350,430

Shares issued to consultant and directors for services

Stock-based compensation

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Shares issued, net of share settlement for withholding taxes paid upon vesting of restricted stock awards

Shares issued - registered offerings - net of offering costs

Shares issued to consultant & directors for services

Shares issued - registered offerings - net of offering costs of $1,128,284

Shares issued through the exercise of options

Shares issued to consultants and directors for services

Stock-based compensation

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Net proceeds from the issuances of common stock

Net proceeds from the exercise of stock options

Payments for taxes related to net share settlement of equity awards

Net Cash Provided by Financing Activities

Net (Decrease) Increase in Cash and Cash Equivalents

Net Increase (Decrease) in Cash and Cash Equivalents

Cash and Cash Equivalents, Beginning of Year

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Payment of accrued liabilities with common stock

Common stock issued for consulting services

The accompanying notes are an integral part of these consolidated financial statements.

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to Lightbridge Corporation and began its focus on developing and commercializing metallic nuclear fuels.

The Company is a nuclear fuel technology company developing its next generation nuclear fuel technology.

The Company is a nuclear fuel technology company developing its nuclear fuel.

The Company views its operations and manages its business as one business segment, which is the development and commercialization of its nuclear fuel.

Basis of Consolidation

These consolidated financial statements include the accounts of Lightbridge, a Nevada corporation, and the Company’s wholly-owned subsidiaries, TPI, a Delaware corporation, and Lightbridge International Holding LLC, a Delaware limited liability company.

These wholly-owned subsidiaries are inactive.

These consolidated financial statements included the accounts of Lightbridge, a Nevada corporation, and the Company’s wholly-owned subsidiaries, TPI, a Delaware corporation, and Lightbridge International Holding LLC, a Delaware limited liability company.

These wholly-owned subsidiaries were inactive.

All intercompany transactions and balances have been eliminated in consolidation.

Segment Reporting

We report our results in a single reportable segment, which reflects how our chief operating decision maker allocates resources considering our core data, which is managed centrally on a company-wide basis and evaluates our financial results.

Because we have a single reportable segment, all required financial segment information can be found directly in the Consolidated Financial Statements.

We evaluate the performance of our reporting segment based on our operating expenses.

Basis of Presentation and Use of Estimates and Assumptions

The preparation of consolidated financial statements, in conformity with accounting principles generally accepted in the United States of America (GAAP), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of expenses during the reporting period.

The preparation of consolidated financial statements, in conformity with accounting principles generally accepted in the United States of America (GAAP), requires management to make estimates and assumptions that affected the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of expenses during the reporting period.

Actual results could differ from those estimates.

Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary.

Estimates and assumptions were periodically reviewed and the effects of revisions were reflected in the consolidated financial statements in the period they are determined to be necessary.

There were no significant estimates at December 31, 2024 and 2023.

Fair Value of Financial Instruments

The Company determines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between unaffiliated market participants at the measurement date.

ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value.

Assets and liabilities measured at fair value are categorized based on whether the inputs are observable in the market and the degree that the inputs are observable.

The Company determined fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between unaffiliated market participants at the measurement date.

Accounting Standards Codification (ASC), Fair Value Measurement (ASC 820), established a fair value hierarchy that prioritizes the inputs used to measure fair value.

Assets and liabilities measured at fair value were categorized based on whether the inputs are observable in the market and the degree that the inputs are observable.

The hierarchy gives the highest priority to active markets for identical assets and liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).

The categorization of financial instruments within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.

The three levels of the fair value hierarchy are as follows:

The categorization of financial instruments within the valuation hierarchy was based on the lowest level of input that is significant to the fair value measurement.

The three levels of the fair value hierarchy were as follows:

Level 1 - Observable inputs such as quoted prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly.

These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and inputs other than quoted prices that are observable for the asset or liability;

Level 2 - Inputs other than quoted prices that were observable for the asset or liability, either directly or indirectly.

These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that were not active and inputs other than quoted prices that were observable for the asset or liability;

Level 3 - Unobservable inputs that reflect management’s assumptions.

For disclosure purposes, assets and liabilities are classified in their entirety in the fair value hierarchy level based on the lowest level of input that is significant to the overall fair value measurement.

The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the placement within the fair value hierarchy levels.

The Company’s financial instruments consist principally of cash and cash equivalents, accounts payable and accrued liabilities.

The carrying amounts of cash and cash equivalents (which includes U.S.

treasury bills at December 31, 2022), accounts payable and accrued liabilities are considered to be a Level 1 measurement, representative of their respective fair values because of the short-term nature of those instruments.

treasury bills are classified as Level 1 on the fair value hierarchy as there are quoted prices in active markets for identical assets.

The following tables summarize the valuation of the Company’s cash equivalents that fall within the fair value hierarchy (in millions) at December 31, 2022.

There were no cash equivalents at December 31, 2023.

Treasury Bills

For disclosure purposes, assets and liabilities were classified in their entirety in the fair value hierarchy level based on the lowest level of input that was significant to the overall fair value measurement.

The Company’s assessment of the significance of a particular input to the fair value measurement required judgment and may have affected the placement within the fair value hierarchy levels.

The Company’s financial instruments consisted principally of cash and cash equivalents, accounts payable and accrued liabilities.

The carrying amounts of our financial instruments are considered to be a Level 1 measurement, because of the short-term nature of those instruments.

The following table summarize the valuation of the Company’s financial instruments that fall within the fair value hierarchy (in millions) at December 31, 2024:

Cash and cash equivalents

Accounts payable and accrued liabilities

The following table summarize the valuation of the Company’s financial instruments that fall within the fair value hierarchy (in millions) at December 31, 2023:

Cash and cash equivalents

Accounts payable and accrued liabilities

Certain Risks and Uncertainties

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Also, the success of the Company’s operations will be subject to other numerous contingencies, some of which are beyond management’s control.

These contingencies include general and regional economic conditions, contingent liabilities, potential competition with other nuclear fuel developers, including those entities developing accident tolerant fuels, changes in government regulations, risks related to the research and development of our nuclear fuel, regulatory approval of the Company’s fuel, support for nuclear power, changes in accounting and taxation standards, inability to achieve overall short-term and long-term research and development milestones toward commercialization, future impairment charges to the Company’s assets, and global or regional catastrophic events.

These contingencies include general and regional economic conditions, contingent liabilities, potential competition with other nuclear fuel developers, including those entities developing accident tolerant fuels (ATFs), changes in government regulations, risks related to the R&D of our nuclear fuel, regulatory approval of the Company’s fuel, support for nuclear power, changes in accounting and taxation standards, inability to achieve overall short-term and long-term R&D milestones toward commercialization, future impairment charges to the Company’s assets, and global or regional catastrophic events.

The Company may also be subject to various additional political, economic, and other uncertainties.

The Company is engaged in significant research and development (R&D) activities to advance its nuclear fuel technology at Idaho National Laboratory (INL).

For the year ended December 31, 2024, R&D expenses associated with activities conducted at the INL accounted for approximately 37 % of the Company’s total R&D expenditure.

The Company currently relies on INL for developing, testing and evaluating its nuclear fuel.

Any disruption in access to INL’s resources, including changes in government policies, facility downtime, regulatory constraints, or unforeseen operational challenges could have a material adverse effect on the Company’s current ability to advance its R&D activities.

Cash and Cash Equivalents

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treasury bills.

It classifies all highly liquid investments with original stated maturities of three months or less from date of purchase as cash equivalents and all highly liquid investments with stated maturities of greater than three months as marketable securities.

The Company holds cash balances in excess of the federally insured limits of $ 250,000 .

It deems this credit risk not to be significant as cash is held by two prominent financial institutions in 2023 and 2022.

The Company buys and holds short-term U.S.

treasury bills to maturity.

treasury bills totaled zero and $ 19.9 million as of December 31, 2023 and 2022, respectively.

The remaining $ 9.0 million at December 31, 2022, were on deposit with two prominent financial institutions.

It classified all highly liquid investments with original stated maturities of three months or less from date of purchase as cash equivalents and all highly liquid investments with stated maturities of greater than three months as marketable securities.

The Company held cash balances in excess of the federally insured limits of $ 250,000 .

The Company deemed this credit risk not to be significant as cash was held by two prominent financial institutions in 2024 and 2023.

Contributed Services - Research and Development

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Additionally, the Company concluded that the grants met the definition of a contribution, as the grants were a non-reciprocal transaction.

As such, the Company determined that Subtopic 958-605, Not-for-Profit-Entities-Revenue Recognition (Subtopic 958-605), applies for these contributed services, even though the Company is a business entity, as guidance in the contributions received subsections of Subtopic 958-605 applies to all entities (not-for-profits and business entities).

Subtopic 958-605 requires nonfinancial assets, which includes services, such as the R&D services provided under the Gateway for Accelerated Innovation in Nuclear (GAIN) vouchers described in Note 6.

Research and Development Expenses, be shown on a gross method at the fair value of the services contributed, with contributed services - research and development shown as other operating income and the related costs as a charge to R&D expense, rather than depicting contributed services - research and development as a reduction of R&D expense.

As such, the Company determined that Subtopic 958-605, Not-for-Profit-Entities-Revenue Recognition (Subtopic 958-605), applied for these contributed services, even though the Company is a business entity, as guidance in the contributions received subsections of Subtopic 958-605 applies to all entities (not-for-profits and business entities).

Subtopic 958-605 required nonfinancial assets, which includes services, such as the R&D services provided under the Gateway for Accelerated Innovation in Nuclear (GAIN) vouchers, (totaled $ 0 and $ 31,000 for 2024 and 2023, respectively) be shown on a gross method at the fair value of the services contributed, with contributed services - research and development shown as other operating income and the related costs as a charge to R&D expense, rather than depicting contributed services - research and development as a reduction of R&D expense.

The fair value of contributed services was determined by the cost of professional time and materials, which were charged by the subcontractor who fulfilled the services contributed under the grant award.

The principal market used to arrive at fair value is the market in which the Company operates.

Costs for filing and legal fees for trademark applications are capitalized.

Trademarks are considered intangible assets with an indefinite useful life and therefore are not amortized.

The Company performs an impairment test in the fourth quarter or more frequently if events or circumstances indicate that an impairment loss may have been incurred.

For the fourth quarter 2023 test, the Company applied the FASB's accounting guidance which allows the company to first assess qualitative factors to determine the extent of additional quantitative analysis, if any, that may be required to test trademarks for impairment.

Costs for filing and legal fees for trademark applications were capitalized.

Trademarks were considered intangible assets with an indefinite useful life and therefore were not amortized.

The Company performed an impairment test in the fourth quarter or more frequently if events or circumstances indicate that an impairment loss may have been incurred.

For the fourth quarter 2024 test, the Company applied the accounting guidance which allowed the company to first assess qualitative factors to determine the extent of additional quantitative analysis, if any, that may have required to test trademarks for impairment.

Based on the qualitative assessments performed, the company concluded that it was more likely than not that the fair value of the Trademarks substantially exceeded its carrying value and therefore, further quantitative analysis was not required.

As a result, no impairment was recorded.

As of December 31, 2023 and December 31, 2022, the carrying value of trademarks was approximately $ 0.1 million.

As of December 31, 2024 and 2023, the carrying value of trademarks was approximately $ 0.1 million.

The Company recognizes operating lease right of use assets and liabilities at commencement date based on the present value of the future minimum lease payments over the lease term.

Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet in accordance with the short-term lease recognition exemption.

The Company applies the practical expedient to non-separate and non-lease components for all leases that qualify.

Lease expense is recognized on a straight-line basis over the lease term.

The Company has only one lease for office rent and the lease is for a term of 12 months without renewal options.

Income taxes are accounted for using the asset and liability method.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of assets and liabilities and their respective tax bases, operating loss carryforwards, and tax credit carryforwards.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

In accordance with Financial Accounting Standards Board (FASB) ASC 740, Accounting for Income Taxes , the Company reflects in the financial statements the benefit of positions taken in a previously filed tax return or expected to be taken in a future tax return only when it is considered ‘more-likely-than-not’ that the position taken will be sustained on its technical merits by a taxing authority upon examination.

As of December 31, 2023 and 2022, the Company had no unrecognized income tax benefits and correspondingly there is no impact on the Company’s effective income tax rate associated with these items.

The Company’s policy for recording interest and penalties relating to uncertain income tax positions is to record them as a component of income tax expense in the accompanying consolidated statements of operations.

Leases with an initial term of 12 months or less were not recorded on the consolidated balance sheet in accordance with the short-term lease recognition exemption.

The Company applied the practical expedient to not separate non-lease components for all leases that qualified.

Lease expense was recognized on a straight-line basis over the lease term.

The Company had only one lease for office rent and the lease was for a term of 12 months without renewal options.

Income taxes were accounted for using the asset and liability method.

Deferred tax assets and liabilities were recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of assets and liabilities and their respective tax bases, operating loss carryforwards, and tax credit carryforwards.

Deferred tax assets and liabilities were measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences were expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates was recognized in income in the period that included the enactment date.

In accordance ASC 740, Accounting for Income Taxes , the Company reflected in the financial statements the benefit of positions taken in a previously filed tax return or expected to be taken in a future tax return only when it was considered ‘more-likely-than-not’ that the position taken will be sustained on its technical merits by a taxing authority upon examination.

As of December 31, 2024 and 2023, the Company had no unrecognized income tax benefits and correspondingly there was no impact on the Company’s effective income tax rate associated with these items.

The Company’s policy for recording interest and penalties relating to uncertain income tax positions was to record them as a component of income tax expense in the accompanying consolidated statements of operations.

As of December 31, 2024 and 2023, the Company had no such accruals.

Research and Development Expenses

Research and development expenses are expensed when incurred.

Research and development expenses consist primarily of wages and related payroll benefits, non-cash stock-based compensation, materials, testing, consulting, and other third-party research and development services, related to the development of the Company’s nuclear fuel.

Advance payments for goods or services for future research and development activities are deferred and expensed as the goods are delivered or the related services are performed.

Research and development expenses were expensed when incurred.

Research and development expenses consisted primarily of wages and related payroll benefits, non-cash stock-based compensation, materials, R&D modeling computer hardware and software, testing, consulting, and other third-party research and development services, related to the development of the Company’s nuclear fuel.

Advanced payments for goods or services for future research and development activities were deferred and expensed as the goods were delivered or the related services were performed.

Stock-Based Compensation

The stock-based compensation expense incurred by the Company for employees and directors in connection with its equity incentive plan is based on the employee model of ASC 718, and the fair value of any stock options granted is measured at the grant date.

Options or common stock granted to consultants for services performed are accounted for in the same manner as options and stock issued to employees for services.

Awards with service-based vesting conditions only:

Expense is recognized on a straight-line basis over the requisite service period of the award.

The Company uses a Black-Scholes pricing model to determine the fair value of stock options on the measurement date of the grant for service-based vesting conditions.

The Company estimates forfeitures at the time of grant and revises the estimate, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

The forfeiture rate estimate used for all equity awards was zero, based on the experience of the Company having an insignificant historical forfeiture rate.

Shares that are issued to employees upon exercise of the stock options or vesting of Restricted Stock Units (RSUs) or Restricted Stock Awards (RSAs) grants may be issued net of the number of shares with a fair value equal to the amount required to satisfy applicable tax withholding requirements.

As a result, the actual number of shares issued with tax withholding obligations are fewer than the actual number of shares exercised under the stock option or on the dates of vesting of RSU or RSA grants.

The Company grants RSAs, which is an award of common shares that have full voting rights and dividend rights (with dividends paid upon vesting of the RSA) but are restricted regarding the sale or transfer before vesting.

The stock-based compensation expense incurred by the Company for employees and directors in connection with its equity incentive plan was based on the employee model of ASC 718, Compensation—Stock Compensation , and the fair value of any stock options granted was measured at the grant date.

Options or common stock granted to consultants for services performed were accounted for in the same manner as options and stock issued to employees for services.

Awards with service-based vesting conditions only were expensed on a straight-line basis over the requisite service period of the award.

The Company used a Black-Scholes pricing model to determine the fair value of stock options on the measurement date of the grant for service-based vesting conditions.

Shares that were issued to employees upon exercise of the stock options or vesting of Restricted Stock Units (RSUs) or Restricted Stock Awards (RSAs) grants were issued net of the number of shares with a fair value equal to the amount required to satisfy applicable tax withholding requirements.

As a result, the actual number of shares issued with tax withholding obligations were fewer than the actual number of shares exercised under the stock option or on the vesting dates of RSU or RSA grants.

The Company granted RSAs, which was an award of common shares that have full voting rights and dividend rights (with dividends paid upon vesting of the RSA) but are restricted regarding the sale or transfer before vesting.

These restrictions lapse as the award vests.

The shares are forfeited and returned to the Company if they do not vest.

The RSAs are included in common stock issued and outstanding and are considered contingently issuable in the calculation of weighted-average shares outstanding for purposes of calculating earnings per share.

The consolidated statement of changes in stockholders’ equity shows the initial grant of RSAs as a reclassification from additional paid-in capital to common stock, with any compensation expense related to the RSAs included in stock-based compensation.

The shares were forfeited and returned to the Company if they did not vest.

The RSAs were included in common stock issued and outstanding and were considered contingently issuable in the calculation of weighted-average shares outstanding for purposes of calculating earnings per share.

The consolidated statement of changes in stockholders’ equity showed the initial grant of RSAs as a reclassification from additional paid-in capital to common stock, with any compensation expense related to the RSAs included in stock-based compensation.

The cash flow impact is reflected within financing activities in the consolidated statements of cash flows.

The number of RSAs to be granted are determined by the closing stock price on the date of the RSAs grant.

Under ASC 718, the Company elected to account for forfeitures as they occur and recorded compensation cost assuming all option holders have completed the requisite service period.

If an employee forfeited an award because they failed to complete the requisite service period, the Company reversed compensation cost previously recognized in the period the award was forfeited.

Thus, the total cumulative amount of compensation cost recognized for an award was the same regardless of whether the Company elected to estimate forfeitures or accounted for forfeitures as they occurred.

Comprehensive Loss

Comprehensive loss is defined as a change in equity of a business enterprise during a period resulting from transactions from nonowner sources.

Comprehensive loss was defined as a change in equity of a business enterprise during a period resulting from transactions from non-owner sources.

There have been no items qualifying as other comprehensive loss and, therefore, for all periods presented, the Company's comprehensive loss was the same as its reported net loss.

Recently Adopted Accounting Pronouncement

The FASB issued ASU No.

2016-13, Financial Instruments - Credit Losses (Topic 326).

This standard requires a financial asset to be presented at the net amount expected to be collected.

The financial assets of the Company in scope of ASU 2016-13 will primarily be accounts receivable.

The Company will estimate an allowance for expected credit losses on accounts receivable that result from the inability of customers to make the required payments.

In estimating the allowance for expected credit losses, consideration will be given to the current aging of receivables, historical experience, and a review for potential bad debts.

The Company does not expect to have revenue or receivables for the foreseeable future.

The Company adopted this guidance on January 1, 2023, and it did not have a material impact on its results of operations, financial position, and disclosures because the Company had no outstanding accounts receivable on which to apply this new standard.

Recent Accounting Pronouncements Not Yet Adopted

In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging- Contracts in Entity’s Own Equity (Subtopic 815-40), which simplifies the complexity associated with applying U.S.

GAAP for certain financial instruments with characteristics of liabilities and equity.

This ASU (1) simplifies the accounting for convertible debt instruments and convertible preferred stock by removing the existing guidance in ASC 470-20, Debt:

Debt with Conversion and Other Options , that requires entities to account for beneficial conversion features and cash conversion features in equity, separately from the host convertible debt or preferred stock;

(2) revises the scope exception from derivative accounting in Subtopic 815-40 for freestanding financial instruments and embedded features that are both indexed to the issuer’s own stock and classified in stockholders’ equity, by removing certain criteria required for equity classification;

and (3) revises the guidance in ASC 260, Earnings Per Share , to require entities to calculate diluted earnings per share for convertible instruments by using the if-converted method.

ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years.

Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.

Adoption is either through a modified retrospective method or a full retrospective method of transition.

The Company will adopt this guidance January 1, 2024 and does not expect the adoption to have a material impact on its results of operations, financial position, and disclosures because the Company does not have any transactions or instruments to which this standard applies.

If in the future, the Company issues new convertible debt, warrants or other instruments, the standard may have a material effect, but it cannot be determined at this time.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (ASU 2023-07).

The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets.

The ASU is effective for us January 1, 2024 and will be applied retrospectively.

Recent Adopted Pronouncements

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (ASU 2023-07), which expanded on the required disclosure of incremental segment information.

The new guidance was effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company adopted this ASU on January 1, 2024.

This ASU resulted in additional disclosures upon adoption.

In August 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No.

2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging- Contracts in Entity’s Own Equity (Subtopic 815-40), which simplified the complexity associated with applying GAAP for certain financial instruments with characteristics of liabilities and equity.

This ASU (1) simplified the accounting for convertible debt instruments and convertible preferred stock by removing the existing guidance in ASC 470-20, Debt:

Debt with Conversion and Other Options , that required entities to account for beneficial conversion features and cash conversion features in equity, separately from the host convertible debt or preferred stock;

(2) revised the scope exception from derivative accounting in Subtopic 815-40 for freestanding financial instruments and embedded features that were both indexed to the issuer’s own stock and classified in stockholders’ equity, by removing certain criteria required for equity classification;

and (3) revised the guidance in ASC 260, Earnings Per Share , to require entities to calculate diluted earnings per share for convertible instruments by using the if-converted method.

ASU 2020-06 was effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years.

Early adoption was permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.

Adoption was either through a modified retrospective method or a full retrospective method of transition.

The Company adopted this guidance on January 1, 2024 and the adoption did not have a material impact on its results of operations, financial position, and disclosures because the Company did not have any transactions or instruments to which this standard applied.

If in the future the Company issued new convertible debt, warrants or other instruments, the standard may have a material effect, but it cannot be determined at this time.

Recent Accounting Pronouncements

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (ASU 2023-09), which modified the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign).

ASU 2023-09 also required entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes.

The guidance was effective for annual periods beginning after December 15, 2024.

Early adoption was permitted for annual financial statements that have not yet been issued or made available for issuance.

ASU 2023-09 should be applied on a prospective basis, but retrospective application was permitted.

The Company does not expect this guidance to have a material impact on its consolidated financial statements and related disclosures upon adoption.

In November 2024, the FASB issued ASU No.

2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses (“ASU 2024-03”), which required disclosure of certain costs and expenses on an interim and annual basis in the notes to the consolidated financial statements.

The guidance is effective for annual reporting periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027.

Early adoption is permitted.

This ASU will likely result in additional required disclosure when adopted.

The Company is currently evaluating the provisions of this ASU and the impact on its consolidated financial statements and related disclosures.

The guidance is to be applied either (1) prospectively to financial statements issued for reporting periods after the effective date or (2) retrospectively to any or all prior periods presented in the financial statements.

The Company is currently evaluating the potential impact of adopting this new guidance on the consolidated financial statements and related disclosures.

The Company has evaluated other recently issued, but not yet effective, accounting standards that have been issued or proposed by the FASB or other standards-setting bodies through the filing date of these consolidated financial statements and does not believe the future adoption of any such standards will have a material impact on the consolidated financial statements and related disclosures.

Net Loss Per Share

Basic net loss per share is computed using the weighted-average number of common shares outstanding during the reporting period, except that it does not include unvested common shares subject to repurchase or cancellation.

Diluted net loss per share is computed using the weighted-average number of common shares and, if dilutive, potential common shares outstanding during the period.

Potential common shares consist of the incremental common shares issuable upon the exercise of stock options.

For the years ended December 31, 2023 and 2022, there is no difference in the number of shares used to calculate basic and diluted shares outstanding as the inclusion of the potentially dilutive securities would be antidilutive.

The following outstanding securities have been excluded from the computation of diluted weighted shares outstanding for the years noted below, as they would have been anti-dilutive due to the Company’s losses at December 31, 2023 and 2022 and also because the exercise price of certain of these outstanding securities was greater than the average closing price of the Company’s common stock.

Basic net loss per share was computed using the weighted-average number of common shares outstanding during the reporting period, except that it did not include unvested common shares subject to repurchase or cancellation.

Diluted net loss per share was computed using the weighted-average number of common shares and, if dilutive, potential common shares outstanding during the period.

Potential common shares consisted of the incremental common shares issuable upon the exercise of stock options.

For the years ended December 31, 2024 and 2023, there was no difference in the number of shares used to calculate basic and diluted shares outstanding as the inclusion of the potentially dilutive securities would be antidilutive.

The outstanding securities in the table below have been excluded from the computation of diluted weighted shares outstanding for the years noted below, as they would have been anti-dilutive due to the Company’s losses at December 31, 2024 and 2023 and also because the exercise price of certain of these outstanding securities was greater than the average closing price of the Company’s common stock.

Stock options outstanding

Restricted stock awards outstanding

Prepaid Project Costs

Prepaid Project Costs – Short-Term

On October 16, 2023, the Company engaged RATEN ICN in Romania to perform an engineering study to assess the compatibility and suitability of Lightbridge Fuel™ for use in Canada Deuterium Uranium (CANDU) reactors.

The total price of approximately $ 0.2 million shall be payable in three installments, including an advance payment of $ 0.1 million, and total of a milestone payment and a final payment of approximately $0.1 million.

The Company advanced payment for future project work totaling approximately $ 56,000 and approximately 50 % of this amount was expensed at December 31, 2023 and the remaining amount was recorded under Prepaid expenses and other current assets.

On December 5, 2023, the Company entered into an agreement with Centrus Energy to conduct a front-end engineering and design (FEED) study to add a dedicated Lightbridge Pilot Fuel Fabrication Facility (LPFFF) at the American Centrifuge Plant in Piketon, Ohio.

The work is expected to be completed in 2024.

The Company advanced payment for future project work totaling approximately $ 0.1 million and approximately 23 % of this amount was expensed at December 31, 2023 and the remaining amount was recorded under Prepaid expenses and other current assets.

Prepaid Project Costs – Long-Term

In 2022, the Company entered into agreements with Idaho National Laboratory (INL), in collaboration with the DOE, to support the development of Lightbridge Fuel™.

Prepaid Project Costs and Other Long-term Assets

In 2022, the Company entered into two agreements with Idaho National Laboratory (INL), in collaboration with the DOE, to support the development of Lightbridge Fuel™.

At the time of signing, the Company made advanced payments for future project work totaling $ 0.4 million to Battelle Energy Alliance, LLC (BEA), DOE’s operating contractor for INL.

In May 2023, the Company and INL modified the agreements to extend the contract term to May 2029, aligning it with the duration of the irradiation testing and increasing the advanced payments by $ 0.1 million.

The prepaid project costs were $ 0.5 million as of December 31, 2023 and $ 0.3 million as of December 31, 2022 under Other Assets - Prepaid project costs and other long-term assets.

The prepaid project costs were $ 0.5 million as of both December 31, 2024 and 2023, recorded under Other Assets - Prepaid project costs and other long-term assets on the accompanying consolidated balance sheets.

Accounts Payable and Accrued Liabilities

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Trade payables

Accrued director fees, legal and consulting expenses

Accrued research and development expenses

Accrued accounting and consulting expenses

Commitments and Contingencies

The Company had total contractual commitments of approximately $ 3.6 million for research and development work as of December 31, 2023 for the following three R&D projects.

Project Task Statements - INL

The Company had approximately $ 2.9 million in outstanding project task statement (PTS) commitments to BEA relating to the R&D work being conducted under the Strategic Partnership Project Agreement (SPP) and Cooperative Research and Development Agreement (CRADA) at INL.

Performance of work under these agreements may be terminated at any time by either party, without any liability, after the effective date of termination, upon giving a thirty-day written notice under the SPP and a sixty-day written notice under the CRADA, to the other party.

In the event of termination, the Company shall be responsible for BEA’s costs (including the closeout costs), through the effective date of termination, but in no event shall the Company’s cost responsibility exceed the total estimated cost stated in each PTS and any subsequent modification to the PTS.

Engineering Study of Lightbridge Fuel™ for use in CANDU reactors

On October 16, 2023, the Company engaged RATEN ICN in Romania to perform an engineering study to assess the compatibility and suitability of Lightbridge Fuel™ for use in CANDU reactors.

As of December 31, 2023, the Company has approximately $ 0.2 million in remaining outstanding project commitments to RATEN ICN.

FEED Study with Centrus Energy for a Lightbridge Pilot Fuel Fabrication Facility

On December 5, 2023, the Company entered into an agreement with Centrus Energy to conduct a FEED study to add a dedicated LPFFF at the American Centrifuge Plant in Piketon, Ohio.

The work is expected to be completed in 2024.

The Company had approximately $ 0.5 million in remaining outstanding project commitments to Centrus Energy for the FEED study at December 31, 2023.

Operating Leases

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In 2022, Lightbridge entered into agreements with BEA, to support the development of Lightbridge Fuel™.

These framework agreements use an innovative structure that consists of an “umbrella” Strategic Partnership Project Agreement and an “umbrella” Cooperative Research and Development Agreement, with an initial duration of seven years.

Throughout the duration of these umbrella agreements, all R&D work contracted with BEA is through the issuance of PTSs.

The initial phase of work under the two agreements will culminate in irradiation testing in the Advanced Test Reactor (ATR) of fuel samples using enriched uranium supplied by the DOE.

These framework agreements use an innovative structure that consists of an “umbrella” SPPA and an “umbrella” CRADA, with an initial duration of seven years.

Throughout the duration of these umbrella agreements, all R&D work contracted with BEA is through the issuance of Project Task Statements (PTS).

The initial phase of work under the two agreements is expected to culminate in future irradiation testing in the INL Advanced Test Reactor of fuel samples 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.

The data, which will be obtained during post-irradiation examination work, will support fuel performance modeling and regulatory licensing efforts for the commercial deployment of Lightbridge Fuel™.

For the year ended December 31, 2023, the Company recorded $ 0.8 million in research and development expenses associated with INL.

Data gathered during future post-irradiation examination work are expected to support fuel performance modeling and regulatory licensing efforts for the commercial deployment of Lightbridge Fuel™.

For the year ended December 31, 2024 and 2023, the Company recorded $ 1.7 million and $ 0.8 million in R&D expenses associated with INL, respectively.

Romania Feasibility Study

On October 16, 2023, the Company engaged RATEN ICN in Romania to perform an engineering study to assess the compatibility and suitability of Lightbridge Fuel™ for use in CANDU reactors.

The total price of approximately $ 0.2 million is payable in three installments, including an advance payment of $ 0.1 million and an interim milestone payment and final payment totaling approximately $0.1 million.

For the year ended December 31, 2023, the Company recorded $ 27,000 in research and development expenses associated with RATEN ICN.

Centrus Feed Study

On December 5, 2023, the Company entered into an agreement with Centrus Energy to conduct a FEED study to add a dedicated Lightbridge pilot fuel fabrication facility (LPFFF) at the American Centrifuge Plant in Piketon, Ohio.

The work began in 2023 and is expected to be completed in 2024 at a cost of approximately $ 0.5 million.

For the year ended December 31, 2023, the Company recorded $ 23,400 in research and development expenses associated with this FEED study.

DOE GAIN Voucher

On March 25, 2021, the Company was awarded a second voucher from the DOE’s GAIN program to support development of Lightbridge Fuel™ in collaboration with the Pacific Northwest National Laboratory (PNNL).

The scope of this project was to demonstrate Lightbridge’s nuclear fuel casting process using depleted uranium, a key step in the manufacture of Lightbridge Fuel™.

The total project value was $ 0.7 million, with three-quarters of this amount expected to be paid by the DOE for the scope of work performed by PNNL and the remaining amount provided by Lightbridge, by providing in-kind services to the project.

The PNNL GAIN voucher project was completed on January 31, 2023.

For the years ended December 31, 2023 and 2022, the Company recorded $ 31,000 and $ 0.4 million of contributed services - research and development, respectively, for work that was completed that caused the DOE to incur payment obligations to its contractor related to the GAIN voucher.

The Company recorded the corresponding amount as R&D expenses for the work that was completed by the DOE contractor.

The R&D services provided under the GAIN vouchers were utilized by the Company in its ongoing development of its next generation nuclear fuel technology.

The Company believes that the amounts paid by the DOE to its contractor for the services provided do not differ materially from what the Company would have paid had it directly contracted for these services for its R&D activity.

Total R&D expenses, including internal costs and other outside R&D costs, for the years ended December 31, 2023 and 2022 were $ 1.9 million and $ 0.7 million, respectively.

The total price of approximately $ 0.2 million was payable in three installments, including an advance payment of $ 0.1 million and an interim milestone payment and final payment totaling approximately $ 0.1 million.

For the year ended December 31, 2024 and 2023, the Company recorded $ 0.2 million and $ 27,000 , respectively in R&D expenses associated with RATEN ICN feasibility study.

The Company made its final payment in December 2024 and has no further obligations under the agreement.

FEED Study with Centrus Energy for a Lightbridge Pilot Fuel Fabrication Facility

On December 5, 2023, the Company entered into an agreement with Centrus Energy to conduct a front-end engineering and design (FEED) study to evaluate deployment of a Lightbridge Pilot Fuel Fabrication Facility (LPFFF) at the American Centrifuge Plant in Piketon, Ohio.

For the year ended December 31, 2024 and 2023, the Company recorded $ 0.3 million and $ 23,400 , respectively in R&D expenses associated with this FEED study and has no further payment obligations.

The Company’s ability to utilize its net operating loss (NOL) carryforwards may be substantially limited due to ownership changes that have occurred or that could occur in the future, as required by Section 382 of the Internal Revenue Code of 1986, as amended (the Code), as well as similar state provisions.

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NOLs created in years beginning after 2017 now only offset 80% of taxable income but no longer have a 20-year expiration.

The 2023 and 2022 annual effective tax rate is estimated to be 25 % for the combined U.S.

The 2024 and 2023 annual effective tax rate was estimated to be 25 % for the combined U.S.

federal and state statutory tax rates.

The Company reviews tax uncertainties in light of changing facts and circumstances and adjusts them accordingly.

As of December 31, 2023 and 2022, there were no tax contingencies or unrecognized tax positions recorded.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities recognized for financial reporting, and the amounts recognized for income tax purposes.

The significant components of deferred tax assets (at an approximate 25 % total effective tax rate, consisting of a 21 % effective tax rate for Federal and a 4 % effective tax rate for the state) as of December 31, 2024 and 2023, respectively, are as follows.

The reconciliation of federal statutory income tax rate to the effective income tax rate was as follows:

Book income at federal statutory rate, 21%

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We file income tax returns in the U.S.

federal jurisdiction and Virginia.

federal jurisdiction and State of Idaho, New York and Virginia.

The tax years 2021 through 2023 remain subject to examination by the appropriate governmental agencies.

At December 31, 2024 and 2023, the Company had no unrecognized tax benefits.

As of December 31, 2024 and 2023, there were no tax contingencies or unrecognized tax positions recorded.

As of December 31, 2024 and 2023, we did not accrue interest and penalties.

Recent Change in U.S.

Prior to 2022, Internal Revenue Code Section 174 allowed taxpayers to deduct R&D expenditures in the year in which they were incurred.

The 2017 Tax Act amended Section 174, effective for amounts paid or incurred in tax years beginning after December 31, 2021, to require taxpayers to charge their R&D expenditures to a capital account.

Capitalized R&D expenses are required to be amortized over five years (15 years for expenditures attributable to foreign research).

Due to the Company’s future significant R&D expenses, the impact of this tax law change will mean that a significant portion of the total operating expenses will be taken as a deduction over a 5-year period rather than being currently deductible.

The Company does not expect to pay taxes as a result of this tax law change as the remaining operating expenses, after excluding research and development expenses are significant and the Company expects to continue to generate losses for tax purposes.

Stockholders’ Equity and Stock-Based Compensation

At December 31, 2024, the Company had 18,783,912 common shares outstanding (including outstanding RSAs totaling 781,864 shares).

Also outstanding were stock options relating to 510,787 shares of common stock, all totaling 14,209,061 shares of common stock and all common stock equivalents, potentially outstanding at December 31, 2023.

Also outstanding were stock options relating to 464,940 shares of common stock (of which 445,275 stock options were vested), all totaling 19,248,852 shares of common stock and all common stock equivalents, outstanding as of December 31, 2024.

At December 31, 2023, the Company had 13,698,274 common shares outstanding (including outstanding RSAs totaling 557,688 shares).

Also outstanding were stock options relating to 525,903 shares of common stock, all totaling 12,426,120 shares of common stock and all common stock equivalents, outstanding at December 31, 2022.

Also outstanding were stock options relating to 510,787 shares of common stock (of which 498,177 stock options were vested), all totaling 14,209,061 shares of common stock and all common stock equivalents, outstanding at December 31, 2023.

Common Stock Equity Offerings

At-the-Market (ATM) Offerings

On May 28, 2019, the Company entered into an at-the-market equity offering sales agreement with Stifel, Nicolaus & Company, Incorporated (Stifel), which was amended on April 9, 2021, pursuant to which the Company may issue and sell shares of its common stock from time to time through Stifel as the Company’s sales agent.

Under this agreement, the Company pays Stifel a commission equal to 4.0% of the aggregate gross proceeds of any sales of common stock under the agreement.

On May 28, 2019, the Company entered into an at-the-market equity offering sales agreement with Stifel, Nicolaus & Company, Incorporated (Stifel), which was amended on April 9, 2021 and May 8, 2024 (the ATM Agreement), pursuant to which the Company may issue and sell shares of its common stock from time to time through Stifel as the Company’s sales agent.

Under this amended agreement, the Company pays Stifel a commission equal to 3.0% of the aggregate gross proceeds of any sales of common stock under the agreement.

The offering of common stock pursuant to this agreement can be terminated with 10 days written notice by either party .

Sales of the Company’s common stock through Stifel, if any, will be made by any method that is deemed to be an “at-the-market” equity offering as defined in Rule 415 promulgated under the Securities Act of 1933.

On March 25, 2021, the Company filed a shelf registration statement on Form S-3, registering the sale of up to $75.0 million of the Company’s securities, which registration statement was declared effective on April 5, 2021 and expires on April 5, 2024.

On April 4, 2023, the Company filed a prospectus supplement with the amount of the Company securities available for issuance totaling $17.9 million with $11.9 million available for future share issuances as of December 31, 2023 .

The Company filed a shelf registration statement on Form S-3 with the Securities and Exchange Commission (SEC) on March 29, 2024, registering the sale of up to $75.0 million of the Company’s securities that was declared effective on April 19, 2024.

On May 10, 2024, the Company filed a prospectus supplement, which was further supplemented on July 19, 2024 and August 9, 2024 (collectively, the “First Prospectus Supplement”), pursuant to which the Company may offer and sell shares of common stock having an aggregate offering price of up to $12.6 million from time to time through the ATM.

The Company exhausted all sales under the First Prospectus Supplement .

On November 22, 2024, the Company filed a prospectus supplement (the “Second Prospectus Supplement”) to which the Company may offer and sell shares of common stock having an aggregate offering price of up to $45.0 million from time to time through the ATM.

The Company records its ATM sales on a settlement date basis.

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The Company sold 1,492,148 shares under the ATM for the year ended December 31, 2023 resulting in net proceeds of $ 6.4 million (stock issuance costs were $ 0.4 million).

Stock Option Plan

2020 Equity Incentive Plan

On March 9, 2020, the Board of Directors adopted the Company’s 2020 Omnibus Incentive Plan (the 2020 Plan).

Stock-Based Compensation

Amendment to 2020 Omnibus Incentive Plan

On March 9, 2020, the Board of Directors adopted the Company’s 2020 Omnibus Incentive Plan (2020 Plan).

On September 3, 2020, the shareholders approved the 2020 Plan to authorize grants of the following types of awards:

(a) Options, (b) Stock Appreciation Rights, (c) Restricted Stock and Restricted Stock Units, and (d) Other Stock-Based and Cash-Based Awards.

The total number of shares of common stock available for issuance under the 2020 Plan is 1,800,000 shares with 803,467 shares available for future issuance at December 31, 2023.

On February 27, 2024, the Board of Directors approved an increase of 700,000 shares to the authorized number of shares under the 2020 Plan, increasing the total authorized number of shares from 1,800,000 shares to 2,500,000 shares .

This increase was approved by the stockholders at the shareholders’ annual meeting on April 19, 2024.

The total number of shares of common stock available for issuance under the 2020 Plan was 2,500,000 shares with 1,073,914 shares available for future issuance at December 31, 2024.

Stock Options

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Options exercisable, December 31, 2024

During the year ended December 31, 2024, the Company received approximately $ 42,000 of net proceeds from the exercise of 10,974 stock options.

During the year ended December 31, 2024, the Company issued 71,330 stock options to two consultants.

These options were assigned a fair value of $ 1.77 per share.

For the year ended December 31, 2022, the Company issued 18,852 stock options to two consultants.

These options were assigned a weighted average fair value of $ 3.98 per share.

The value was determined using the Black-Scholes pricing model.

For expected volatility, we have concluded that our historical volatility over the option’s expected holding term provides the most reasonable basis for this estimate.

For the risk-free interest rate, we use U.S.

These options were assigned a fair value of $ 1.19 per share (total fair value of $ 85,000 ).

During the year ended December 31, 2023, the Company issued 35,482 stock options to two consultants.

These options were assigned a fair value of $ 1.77 per share (total fair value of $ 42,800 ).

The weighted-average grant-date fair value per share of the stock options granted for the years ended December 31, 2024 and 2023, was $ 2.91 and $ 4.58 , respectively.

The fair value was determined using the Black-Scholes pricing model.

For expected volatility, the Company concluded that the historical volatility over the option’s expected holding term provided the most reasonable basis for this estimate.

For the risk-free interest rate, the Company used U.S.

Treasury Note rates, which mature at approximately the same time as the option’s expected holding term or option life determined by using the simplified method.

We recognize forfeitures of equity-based awards as a reduction to compensation costs in the period in which they occur.

The estimated future forfeiture rates, based on the historical forfeiture rates, which were not significant, were zero.

The Company recognized forfeitures of equity-based awards as a reduction to compensation costs in the period in which they occur.

The following assumptions were used in the Black-Scholes pricing model to determine the fair value of stock options granted during the years ended December 31, 2024 and 2023:

Expected volatility

75.36 %- 92.89 %

68.13 %- 95.70 %

Risk free interest rate

3.76 %- 4.54 %

4.21 %- 5.12 %

Dividend yield rate

Expected life

Closing price per share - common stock

$ 2.49 - $ 2.62

$ 4.31 - $ 4.35

The intrinsic value is calculated as the difference between the fair value of the Company's common stock and the exercise price of the stock options.

The fair value of the Company's common stock is $ 3.21 and $ 3.89 per share at December 31, 2023 and 2022, respectively.

As of December 31, 2023, total unrecognized compensation cost related to option awards was $ 41,600 , which is expected to be recognized over a remaining weighted-average vesting period of 2.0 years.

The fair value of the Company's common stock was $ 4.73 and $ 3.21 per share at December 31, 2024 and 2023, respectively.

As of December 31, 2024 and 2023, total unrecognized compensation cost related to option awards was $ 41,600 , which is expected to be recognized over a remaining weighted-average vesting period of 2.06 years.

Consultants’ Stock Issuances

For the years ended December 31, 2023 and 2022, the Company issued 13,325 shares (with stock prices ranging from $ 4.00 to $ 5.82 per share) and 10,565 shares of common stock (with stock prices ranging from $ 4.56 to $ 8.35 per share), respectively, to its investor relations firm for services provided during the years, recorded to general and administrative expenses.

The total stock-based compensation expense recorded for these share issuances was $ 60,000 for each year with a weighted average grant date fair value of $ 4.50 per share.

Directors’ Stock Issuances

On November 20, 2023, the Board of Directors approved an equity grant valued at $ 240,000 (included in accrued liabilities and general and administrative expenses) in total to its six directors, which resulted in granting a total of 60,456 shares of common stock, valued on the grant date at $ 3.97 per share, which vested on January 2, 2024.

On December 15, 2022, the Board of Directors approved an equity grant valued at $ 200,000 in total to its five independent directors, recorded in general and administrative expenses, which resulted in granting a total of 52,085 shares of common stock to the five independent directors, valued on the grant date at $ 3.84 per share, which vested on January 3, 2023.

For the year ended December 31, 2024 and 2023, the Company issued 18,201 shares (with stock prices ranging from $ 3.00 to $ 4.00 per share with a weighted average stock price of $ 3.30 per share) and 13,325 shares (with stock prices ranging from $ 4.00 to $ 5.82 per share) of common stock, respectively, to its investor relations firm for services provided during the period, recorded to general and administrative expenses.

These shares vested immediately upon issuance.

The expense recorded for these share issuances was $15,000 for each quarter with a weighted average grant date fair value of $ 3.30 per share in 2024 and $ 4.50 per share in 2023, respectively.

The shares were valued based on the closing market price of the Company’s common stock on the date of grant.

On August 19, 2024, the Board of Directors approved an equity grant valued at $ 180,000 to a consulting and investment research firm, for corporate advisory services to be provided over a twelve-month period, and preparation and dissemination of a report regarding the Company, which resulted in issuing the consultant 71,713 shares of common stock on the grant date, valued at $ 2.51 per share.

These shares vested immediately upon issuance and are not forfeitable.

The compensation cost of $ 180,000 is recognized on a straight-line basis over the requisite service period.

Approximately $ 66,000 was recorded as consulting expense for the year ended December 31, 2024.

As of December 31, 2024, the unrecognized compensation cost of approximately $ 114,000 was recorded under Prepaid expenses and other current assets on the accompanying consolidated balance sheet, which is expected to be recognized over a remaining service period of 0.6 years.

Director Compensation – Equity-Settled Awards

On December 4, 2024, the Board of Directors approved an equity grant valued at $ 500,000 in total to its five directors for the service period and year ended December 31, 2024, which resulted in granting a total of 85,915 shares of common stock, valued on the grant date at $ 5.82 per share, with a scheduled share release date on January 2, 2025.

On November 20, 2023, the Board of Directors approved an equity grant valued at $ 240,000 in total to its six directors for the service period and year ended December 31, 2023, which resulted in granting a total of 60,456 shares of common stock, valued on the grant date at $ 3.97 per share, with the shares issued in January 2024.

As a result, the fair value of the stock awards was measured on the grant date and recorded as an increase to stock-based compensation expense and additional paid-in capital in 2024.

The fair value of the shares granted was determined based on the closing market price of the Company's common stock on the grant date.

Restricted Stock Awards

The following summarizes the Company’s restricted stock award activity and the RSA outstanding:

Grant Date Fair Value

Outstanding, December 31, 2023

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Outstanding, December 31, 2024

The intrinsic value is calculated as the fair value of the Company's common stock.

The fair value of the Company's common stock is $ 3.21 and $ 3.89 per share at December 31, 2023 and 2022, respectively.

The fair value of the RSAs vested in 2023 was $ 0.6 million.

As of December 31, 2023, all the outstanding restricted stock units are unvested.

As of December 31, 2023, total unrecognized compensation cost related to restricted stock units was $ 2.6 million, which is expected to be recognized over a remaining weighted-average vesting period of 2.1 years.

The intrinsic value was calculated as the fair value of the Company's common stock.

The fair value of the Company's common stock was $ 4.73 and $ 3.21 per share at December 31, 2024 and 2023, respectively.

The fair value of the RSAs vested in 2024 and 2023 was $ 1.4 million and $ 0.6 million, respectively.

As of December 31, 2024, all the outstanding restricted stock awards are unvested.

As of December 31, 2024, total unrecognized compensation cost related to restricted stock awards was $ 3.9 million, which is expected to be recognized over a remaining weighted-average vesting period of 2.50 years.

2024 Transactions

In 2024, a total of 253,425 RSAs vested.

These RSAs vest annually with a three-year straight line vesting period.

The Company withheld 100,514 shares to make payments for withholding taxes of $0.4 million on these vested shares, resulting in the issuance of 152,911 net shares to its employees and consultants .

The common shares withheld became available for reissuance under the 2020 Plan.

On December 4, 2024, the Board of Directors approved an RSA equity grant of approximately $ 2.8 million, which equated to 484,269 RSAs granted to all of its employees and two consultants, valued at the closing market price of the Company’s stock on the grant date of $ 5.82 per share.

These RSAs awards vest annually in three equal installments on the grant date anniversary.

2023 Transactions

On May 3, 2023, the Board of Directors approved a RSA equity grant valued at $ 120,000 to one new officer of the Company, which resulted in the issuance of a total of 35,088 shares of common stock to the new officer, valued on the grant date at $ 3.42 per share and issued on May 3, 2023.

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These 35,088 shares were included in the total outstanding common shares at December 31, 2023 and compensation expense will be recognized straight line over the three-year vesting period .

On November 20, 2023, the Board of Directors approved a RSA equity grant of approximately $ 1.1 million, which equated to 266,011 RSAs granted to all of its employees and two consultants, valued at the stock price on the grant date of $ 3.97 per share.

These RSAs awards vest annually in three equal installments on the grant date anniversary.

On November 18, 2023, 62,864 of the total 188,588 RSAs that were granted on November 18, 2021 vested.

These RSAs vest annually with a three-year straight line vesting period .

The Company withheld 21,854 common shares to make payments for withholding taxes of $0.1 million on these vested shares.

The Company issued a total of 41,010 shares of common stock, net of this share settlement for the taxes due and paid upon the vesting of these RSAs to its employees.

The common shares withheld became available for reissuance under the 2020 Plan.

On December 15, 2023, 96,863 of the total 290,590 RSAs that were granted on December 15, 2022 vested.

In 2023, a total of 159,727 RSAs vested.

These RSAs vest annually with a three-year straight line vesting period.

The Company withheld 38,746 common shares to make payments for withholding taxes of $0.1 million on these vested shares.

The Company issued a total of 58,117 shares of common stock, net of this share settlement for the taxes due and paid upon the vesting of these RSAs, to its employees.

The Company withheld 60,600 shares to make payments for withholding taxes of $0.2 million on these vested shares, resulting in the issuance of 99,127 net shares to its employees and consultants .

The common shares withheld became available for reissuance under the 2020 Plan.

2022 RSA Transactions

On December 15, 2022, the Board of Directors approved an equity grant of approximately $ 1.4 million, which equaled a total of 290,590 RSAs to all its employees and two consultants, valued at the stock price on the grant date of $ 4.71 per share.

These RSAs awards vest annually in three equal installments on the grant date anniversary.

RSA Summary – 2024 and 2023

As of December 31, 2023 and 2022, there were 557,688 and 416,316 RSAs included in the total issued and outstanding common stock, respectively.

As of December 31, 2024 and 2023, there were 781,864 shares and 557,688 shares of RSAs included in the total issued and outstanding common stock, respectively.

The weighted-average grant-date fair value per share of RSAs granted for the years ended December 31, 2024 and 2023, was $ 5.82 and $ 3.91 , respectively.

Compensation expense is recognized in a straight line over the three-year vesting period.

A total of $ 1.2 million and $ 0.7 million of compensation expense was recorded for the year ended December 31, 2023 and 2022, respectively, for the RSAs.

A total of $ 1.4 million and $ 1.2 million of compensation expense was recorded for the years ended December 31, 2024 and 2023, respectively, for the RSAs.

Stock-Based Compensation Expense

Stock Options

The following assumptions were used in the Black-Scholes pricing model to determine the fair value of stock options granted:

Expected volatility

68.13 % to 95.7 %

97.58 % to 115.37 %

Risk free interest rate

4.21 % to 5.12 %

1.02 % to 3.28 %

Dividend yield rate

Expected term

Closing price per share – common stock

$ 4.31 to $ 4.35

$ 5.93 to $ 6.27

Total non-cash stock-based compensation expense recorded related to options granted and restricted stock awards included in the Company’s consolidated statements of operations for the years ended December 31, 2024 and 2023 are as follows (rounded in millions):

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On February 9, 2022, the Company entered into an agreement with We Don’t Have Time Inc.

(WDHT), an organization with a social media network platform dealing with the climate crisis, pursuant to which WDHT provides a variety of climate-change related consulting services to the Company and the Company pays a monthly membership fee of $ 1,200 to WDHT.

Chakraborty, a member of the Company’s Board of Directors, is also the CEO of WDHT’s US division.

For the years ended December 31, 2023 and 2022, the Company incurred $ 14,400 , respectively, in dues paid to WDHT.

(WDHT), an organization with a social media network platform dealing with the climate crisis, pursuant to which WDHT provided a variety of climate-change related consulting services to the Company and the Company paid a monthly membership fee of $ 1,200 to WDHT.

Chakraborty, a member of the Company’s Board of Directors, was also the CEO of WDHT’s US division.

For the years ended December 31, 2024 and 2023, the Company incurred $ 0 and $ 14,400 , respectively, in dues paid to WDHT.

This agreement was terminated on January 1, 2024.

Segment Reporting

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources in assessing performance.

The Company has one reportable business segment:

nuclear fuel technology.

This segment consists of the research and development and commercialization of its nuclear fuel.

The Company’s chief operating decision maker (“CODM”) is the chief executive officer.

The accounting policies of the segment are the same as those described in the summary of significant accounting policies.

The CODM assesses performance for the segment based on net loss as reported on the consolidated statement of operations.

The Company expects to continue to incur significant expenses and operating losses for the foreseeable future as it advances its nuclear fuel through all the stages of its development and commercialization.

In addition, the measure of segment assets is reported on the consolidated balance sheet as total assets.

The CODM uses segment net loss to allocate resources predominately in the annual budget and forecasting process and uses that measure as a basis for evaluating progress toward R&D milestones.

The CODM uses cash forecast models in deciding how to invest into the segment.

Research and development expenses, general and administrative expenses are included in segment net loss and used to monitor budget versus actual results.

Monitoring budgeted versus actual results is used in assessing performance of the segment, while research and development milestones scorecard results and scorecard general and administrative budgeted results are used in establishing management’s incentive compensation.

The table below summarizes the significant expense categories regularly provided to the CODM for the years ended December 31, 2024, and 2023 (rounded in millions):

General and administrative

Research and development:

Romania feasibility study

Centrus Energy FEED study

Allocated employee compensation and stock-based compensation

Other outside R&D expenses

Total research and development

Other segments item (1)

(1) Other segment items include interest income and contributed services – research and development

Subsequent Events

Sales of common stock under the Company’s ATM from January 1, 2024 to March 4, 2024 amounted to approximately 179,000 shares, which resulted in total net proceeds of approximately $ 0.6 million.

Sales of common stock under the Company’s ATM from January 1, 2025 to February 28, 2025 amounted to 1.4 million shares, which resulted in total net proceeds of approximately $ 10.1 million.

INL Modification No.

3 to the CRADA PTS

On January 16, 2025, the Company and BEA entered into Modification No.

3 to the PTS under the CRADA, dated September 27, 2022, as amended on May 22, 2023 and May 30, 2023, by and between the Company and BEA.

Pursuant to the terms of Modification No.

3, the potential amounts payable by the Company to reimburse BEA for its expenses and employee time associated with R&D activities were increased by approximately $ 1.6 million, bringing the total estimated cost for the work to be performed under the “umbrella” CRADA to $ 4.2 million.

This modification also required that a $ 600,000 advance payment be made, which was due and paid on January 16, 2025.

After Modification No.

3 to the PTS under the CRADA and the anticipated Modification No.

4 to the PTS under the SPPA, total cash payments from the Company to BEA under both Agreements were estimated at approximately $ 6.5 million excluding project contingencies) on a cost reimbursable basis over the performance periods under the initial releases.

Increase in Authorized Common Shares

On February 26, 2025, the Company’s Board of Directors approved increasing the authorized common shares from 25,000,000 shares to 100,000,000 shares.

This change will take effect upon receiving majority shareholder approval at the 2025 shareholder annual meeting.

Issuance of Series X Preferred Stock

On February 27, 2025, the Company entered into a Subscription and Investment Representation Agreement (the “Subscription Agreement”) with Jesse Funches, chairman of the Audit Committee and an independent member of the Board (the “Purchaser”), pursuant to which the Company agreed to issue and sell one (1) share of the Company’s Series X Preferred Stock, par value $ 0.001 per share (the “Series X Preferred Stock”), to the Purchaser for $100 in cash.

The sale closed on February 27, 2025.

The Company will redeem the Series X Preferred Stock for $ 100 in cash after the Company’s annual 2025 shareholder meeting (the “Annual Meeting”).

The Series X Preferred Stock does not have any voting rights except with respect to any proposal to increase the number of authorized shares of common stock of the Company.

Each share of Series X Preferred Stock will be entitled to 25,000,000 votes on such proposal, voting together with the holders of our common stock.

The votes by the holder of Series X Preferred Stock will be cast at the Annual Meeting automatically in the same “mirrored” proportion as the aggregate votes cast “for” and “against” the proposal by the holders of our common stock who vote on such proposal (excluding abstentions, broker non-votes and shares of common stock that are not voted “for” or “against” such proposal).

The voting power attributable to the Series X Preferred Stock will be disregarded for purposes of determining whether a quorum is present at the Annual Meeting.

An amendment to the Lightbridge Corporation 2020 Omnibus Incentive Plan

On February 26, 2025, the Company’s Board of Directors approved an amendment to the Lightbridge Corporation 2020 Omnibus Incentive Plan to increase the number of shares of common stock available for issuance thereunder from 2,500,000 shares to 5,000,000 shares.

This change will take effect upon receiving shareholder approval at the Company’s 2025 shareholder annual meeting .

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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Chief Executive Officer,

President and Director

President and Chairman

POWER OF ATTORNEY

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/s/ Seth Grae

Chief Executive Officer, President, and Director

Chief Executive Officer, President, and Chairman

March 3, 2025

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(Principal Financial and Accounting Officer)

/s/ Thomas Graham, Jr.

March 4, 2024

Thomas Graham, Jr.

/s/ Sweta Chakraborty

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures