Current Status of the Joint Venture

Pursuant to the Enfission operating agreement, both partners agreed that Enfission would serve as the vehicle to develop, license, and sell nuclear fuel assemblies based on Company-designed metallic fuel technology and other advanced nuclear fuel intellectual property licensed to Enfission by both the Company and Framatome or their affiliates. The joint venture built upon the joint fuel development and regulatory licensing work under previously signed agreements initiated in March 2016.

On November 18, 2019, the Company delivered to the Board of Directors of Enfission a notice of termination of the R&D Services Agreement, dated November 14, 2017, by and among Framatome, Enfission and the Company (as amended by Amendment Number One, dated January 25, 2018, and Amendment Number Two, dated June 20, 2018, the “RDSA”), which, among other things, defined the terms and conditions for joint research and development activities among Framatome, Enfission, and the Company. The notice terminated the RDSA, effective immediately. On November 23, 2019, in connection with the termination of the RDSA, the Board of Directors and the management of Lightbridge determined that it was advisable and in the best interest of the Company and its shareholders to take the necessary steps to dissolve Enfission. On February 11, 2021, Lightbridge and Framatome reached a settlement agreement. (See Note 12. Subsequent Events for settlement agreement with Framatome.) Enfission was inactive as of December 31, 2019 and for the year ended December 31, 2020 and was dissolved on March 23, 2021.

The Enfission operating agreement provided that Lightbridge and Framatome each hold 50% of the total issued Class A voting membership units of the joint venture. The Company’s equity in losses is accounted for under the equity method consisted of the following as of December 31, 2020 and 2019 (rounded in millions):

The Company invested approximately $9.2 million in Enfission and Framatome invested approximately $2.9 million of equity for the period from January 24, 2018 (date of inception of Enfission) to December 31, 2020. In accordance with the provisions in the joint venture operating agreement, the Company did not record its share of the loss in investment in Enfission for the year ended December 31, 2020.

As of December 31, 2020, the Company’s total equity share of the joint venture accumulated losses is limited to the total equity contributions Lightbridge made since January 24, 2018 according to the Enfission joint venture operating agreement. The joint venture operating agreement stated that at no time during the term of the company or upon dissolution or liquidation of the company shall a member with a deficit balance in its capital account have any obligation to Enfission or to the other members of Enfission to restore such deficit capital balance, to the fullest extent permitted by applicable law and to the provisions of the joint venture operating agreement. The Company had not separately guaranteed any obligations of Enfission. The Company does not expect to provide additional equity contributions in 2021 nor for the foreseeable future until Enfission is dissolved.

Enfission was inactive and not significant for 2020 and, therefore, no summarized balance sheet and summarized income statement information is required to be presented.

Summarized balance sheet information for the Company’s equity method investee, Enfission, as of December 31, 2019 is presented in the following table (rounded in millions):

Summarized statement of operations information for the Company’s equity method investee, Enfission, for the year ended December 31, 2019 is presented in the following table (rounded in millions):

As of December 31, 2020 and 2019, the total receivable due from Enfission was $0 and approximately $0.4 million, respectively, which represents management and administrative services, consulting fees and reimbursable expenses Lightbridge charged to Enfission in 2019 (see Note 11. Related Party Transactions). Lightbridge did not bill any management and administrative services, consulting fees or other services to Enfission for the year ended December 31, 2020, as Enfission’s operations were inactive during this reporting period.

Disputed Framatome Invoices

Included in the total liabilities of Enfission of $2.1 million at December 31, 2019, are disputed invoices totaling $1.3 million for research and development work submitted by Framatome in 2019. No amounts related to the equity method investment in Enfission have been recorded on the consolidated statements of operations for the year ended December 31, 2020.

On February 11, 2021, Lightbridge and Framatome reached a settlement agreement in which the Company agreed to pay approximately $4.2 million primarily for these past-due disputed invoices and other related costs. The Settlement Agreement resolved all disputes between the companies and terminated all agreements pertaining to the joint venture. See Note 12. Subsequent Events for the settlement agreement terms and payment to Framatome and the dissolution of Enfission.