Note 5. Commitments and Contingencies

As of June 30, 2024 and December 31, 2023, the Company had total project task orders and contractual commitments for R&D work for the following three R&D projects (rounded in millions):

Project Task Statements - INL Project

On March 26, 2024, the Company and BEA entered into Modification No. 2 (Modification No. 2) to the project task statement (PTS) under the Strategic Partnership Project Agreement (SPPA), dated December 9, 2022, as amended on May 23, 2023, by and between the Company and BEA. Pursuant to the terms of Modification No. 2, the potential amounts payable by the Company to reimburse BEA for its expenses and employee time were increased by approximately $0.6 million, bringing the total estimated cost for the work to be performed under the “umbrella” SPPA to $1.7 million.

After Modification No. 2, total cash payments from the Company to BEA under both Agreements were estimated at approximately $4.3 million (excluding project contingencies) on a cost reimbursable basis over the performance periods under the initial releases.

As of June 30, 2024, the Company had approximately $2.8 million in outstanding PTSs to BEA relating to the R&D work being conducted under the SPPA and “umbrella” 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 SPPA 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.

Romania Feasibility Study of Lightbridge Fuel™ for use in CANDU reactors

On October 16, 2023, the Company engaged Institutul de Cercetări Nucleare Pitești, a subsidiary of Regia Autonoma Tehnologii pentru Energia Nucleara (RATEN ICN) in Romania to perform an engineering study to assess the compatibility and suitability of Lightbridge Fuel™ for use in CANDU reactors.

On July 2, 2024, the Company and RATEN ICN agreed to a change order modifying the remaining scope, schedule, and total fee for the engineering study. The revised total fee is now $0.2 million. As of June 30, 2024, the Company had approximately $0.1 million in remaining outstanding project commitments to RATEN ICN, payable upon the acceptance of the final engineering study report by the Company.

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 Corp. (Centrus Energy) to conduct a front-end engineering and design (FEED) study to construct a Lightbridge Pilot Fuel Fabrication Facility (LPFFF) to manufacture Lightbridge Fuel™ using high-assay low-enriched uranium (HALEU) at the American Centrifuge Plant in Piketon. In the second quarter of 2024, Centrus completed Phase 1 of the FEED Study and issued a report.

On June 27, 2024, the Company and Centrus Energy agreed to a Change Order modifying the remaining scope, schedule, and total fee for the FEED study. The revised total fee is now $0.3 million with $0.1 million as the remaining amount due to Centrus Energy, upon the acceptance of the final FEED study report by the Company.

Operating Leases

The Company leased office space for a 12-month term from January 1, 2024 through December 31, 2024 with a monthly payment of approximately $8,000. The future minimum lease payments required under the non-cancellable operating leases for 2024 total approximately $0.1 million. Total rent expense for the three and six months ended June 30, 2024 was approximately $24,000 and $48,000, respectively. Total rent expense for the three and six months ended June 30, 2023 was approximately $23,000 and $47,000, respectively.