Lightbridge Corporation

And welcome to the LightBridge Corporation Business Update and First Quarter 2021 Conference Call. Please note that today's call is being recorded. It is now my pleasure to introduce Matthew Abinati, Director of Investor Relations for LightBridge Corporation.

Thank you, Catherine, and thanks to all of you for joining us today. The company's earnings release was distributed after the market closed yesterday. and can be viewed on the Investor Relations page of the Lightbridge website at www.ltbridge.com. Joining us on the call today is Seth Gray, Chief Executive Officer, along with Larry Goldman, Chief Financial Officer, Sherry Holloway, Accounting Manager, Andrei Mushikov, Executive Vice President for Nuclear Operations, and Jim Fornoff, Vice President for Nuclear Program Manager. I would like to remind our listeners that any statements on this call that are not historical facts are forward-looking statements. Today's presentation includes forward-looking statements about the company's competitive position and product and service offerings. During today's call, words such as expect, anticipate, believe, and intend will be used in our discussion of goals or events in the future. This presentation is based on current expectations and involves certain risks and uncertainties that may cause actual results to differ significantly from such estimates. These and other risks are set forth in more detail in LightBridge's filing with the Securities and Exchange Commission. LightBridge does not assume any obligation to update or revise any such forward-looking statements, whether as a result of new developments or otherwise. And with that, I would like to turn the call over to our first speaker, Seth Gray, Chief Executive Officer of LightBridge. Hello, Seth.

Well, hello, Matt, and thank you. Thank you all for joining us to discuss LightBridge's first quarter 2021 results. We enter 2021 on a very positive trajectory in terms of our fuel development activities, highlighted by our announcement yesterday that we have successfully demonstrated our proprietary manufacturing process for three-lobe, six-foot rods using surrogate materials. The surrogate rods were manufactured through our co-extrusion process at a length designed for small modular reactors, or SMRs. Andrei Mushakov will provide an overview of this process after my remarks. This manufacturing is important for LightBridge for many reasons. We are beginning to physically produce rods utilizing our technology. Between production of rods and our two gain vouchers, This is all beginning to move to tangible products that are backed by our extensive patent portfolio. We are designing light bridge fuel to enable small modular reactors to more efficiently load follow, ramping up and down in power as renewables are available, replacing fossil fuel plants. In addition, we expect this technology to reduce the cost of generating electricity from an SMR which strengthens the business case for deploying large numbers of SMRs to deliver reliable power and meet climate goals. Our development steps are also applicable to the existing large light water reactors. Last month, DOE awarded LightBridge a second gain funding voucher to support development of LightBridge fuel in collaboration with the Pacific Northwest National Laboratory, PNNL. The scope of the project is to demonstrate LightBridge's casting process using depleted uranium, a key step in the manufacture of LightBridge fuel. The total project value is approximately $664,000 with three-quarters of this amount funded by DOE for the scope performed by PNNL. We expect the project will begin later this quarter. We are pleased with our ongoing efforts at Idaho National Lab, or INL, performing under our funding voucher from the Department of Energy's GAIN program. We are designing an experiment for testing our fuel samples in the Advanced Test Reactor at INL. We anticipate our work under this voucher will be completed in the second half of this year. Being awarded two funding vouchers by the federal government through the DOE with access to their teams of experts and world-class facilities, which are unmatched in the private sector, allows LightBridge to take meaningful strides in our fuel development program. In addition, these funding awards further validate our patented fuel and patented manufacturing process, fitting in strategically with the goals of the federal government. We are seeing an increasing understanding in the Biden administration that nuclear energy must increase to meet the administration's zero emission goals. In fact, you may have seen news reports that tax subsidies for existing nuclear facilities might be included in the upcoming infrastructure bill. It's becoming clearer that there is a paradigm shift in the way governments around the world are looking at nuclear power. In the last year, the U.S. government, through the Nuclear Fuel Working Group, outlined a bold plan that commits to federal funding of R&D for advanced nuclear energy, as well as lifting of the ban on investment by the U.S. International Development Finance Corporation into advanced nuclear energy projects for export. From there, the Nuclear Energy Leadership Act was included as an amendment to the National Defense Authorization Act that passed last fall, focusing DOE efforts on demonstration of advanced reactor concepts, including nuclear fuel technology. And this month, the European Commission announced that it will include nuclear energy in the European Union taxonomy regulation, which steers investment into low-carbon projects. All of these developments matter in setting the stage for attracting greater investment in nuclear energy technology development. Investors in nuclear tend to follow government actions when leveraging their investments, so we expect these changes will lead to more meaningful investment in the nuclear power industry. LightBridge presents a unique opportunity in the nuclear industry. Our fuel design marks the only truly new fuel design since the dawn of light water reactors in the nuclear industry. These are significant changes that will bring significant safety and economic benefits for both existing and new reactors. In many ways, light-bridge fuel can help the nuclear power industry reduce the costs of generating electricity and operating nuclear plants. Over the long run, we expect a transition from most nuclear energy being generated in large reactors to much more generation from larger numbers of small, modular reactors powered by light-rich fuels, offering superior ramp rates for load following with renewables, while providing a meaningful increase in power output. And with that, I will turn the call over to Andrei Mushakov, Executive VP for Nuclear Operations, who will update us on some recent news and review our near-term research and development opportunities. Andrei?

Thank you, Seth. Yesterday, we announced the successful demonstration of our patented core extrusion process using surrogate materials in place of uranium. The surrogate rods were manufactured using our core extrusion process at the six-foot nominal lengths designed for small modular reactors, or SMRs. This successful demonstration of our high-temperature core extrusion illustrates the primary performing process for light-bridge fuel including the helical twist of the fuel rods and the metallurgical bond between the central displacer, surrogate fuel alloy, and the cladding. Rods produced during this demonstration will be used for further development activities, including validation of computer models of the extrusion process and corrosion testing of as fabricated cladding alloys. In parallel, we continue to make progress on our advanced test reactor experiment design with Idaho National Laboratory. We are nearing the completion of the conceptual design phase in which our INL colleagues have been optimizing a combination of design elements in order to achieve burn-up of the fuel samples within the defined window of time in the test reactor. Once the conceptual phase is complete, Idaho National Laboratory will immediately begin the detailed design and safety case for the experiment. We expect the experiment design to be completed later this calendar year. Completion of the ATR experiment design will also allow us to finalize the scopes of work with Idaho National Laboratory for high SEL uranium supply, coupon sample fabrication, reactor radiation, and ultimately post radiation examination of the samples. We are also progressing on the contracting and quality control aspects of our second gain voucher with the Pacific Northwest National Laboratory for demonstration of our fuel casting process using depleted uranium in a 50% weight percent alloy with zirconium. This is a key step in the fabrication process for our fuel, and it also feeds into our needs for fabrication of irradiation fuel samples for the advanced test reactor at Idaho National Laboratory. Again, contracts with PNNL are almost complete, and we expect to be able to execute these contracts with the National Lab shortly. We have also begun the quotation on quality assurance process with our sub vendors for the supply of depleted uranium and zirconium materials, which is a component of LightBridge's mentioned contribution to the project. The total value of the project is approximately $664,000, the three quarters of this amount funded by DOE for the scope performed by Pacific Northwest National Laboratory. Back to you, Seth.

Thank you, Andre. Now we'll turn the call over to Larry Goldman, Chief Financial Officer, to summarize the company's financial results. Larry?

Thank you, Seth, and good afternoon, everyone. For further information regarding our first quarter 2021 financial results and disclosures, please refer to our earnings release that we filed at the closer market yesterday and our Form 10-Q that we will file with the SEC later today. The company maintained a strong working capital position at March 31, 2021, with $15.2 million of cash and cash equivalents compared to $21.5 million at December 31, 2020. We had working capital of $15.2 million at March 31, 2021, as compared to $17.1 million at December 31, 2020, with no debt financing. Total assets were $15.9 million, and total liabilities were $0.6 million at March 31, 2021. Total cash used in operating activities was $6.3 million, an increase of approximately $4.3 million for the three months ended March 31, 2021, compared to the three months ended March 31st, 2020. This increase was due primarily to the dissolution of the Envision Joint Venture and the payment of approximately 4.2 million to Framatone for outstanding invoices for work performed and other expenses incurred by Framatone. Cash provided by financing activities decreased by approximately 0.4 million for the first quarter of 2021 as compared to the first quarter of 2020. This decrease was due to the decrease in cash proceeds from the issuance of our common stock, as we did not raise any equity capital for the three months ended March 31st, 2021. In support of our long-term business and future finance with respect to our fuel development, we expect to continue to seek additional DOE funding in the future, along with new strategic alliances that may contain cost-sharing opportunities contributions and other additional funding from others in order to help fund our future R&D milestones, leading to the commercialization of our Lightbridge fuel. I will now turn the call over to Sherry Holloway, our accounting manager, who will go over select P&L financial information for the first quarter of 2021. Sherry?

Thank you, Larry. Net loss for the first quarter of 2021. was $2 million compared to $2.3 million for the first quarter of 2020, primarily due to these factors. Total R&D expenses were $0.4 million in the first quarter of 2021 compared to $0.4 million in the first quarter of 2020. Expenses were consistent, period over period, as we transitioned to a new fuel development strategy with the DOEs national laboratories. There was a decrease in employee compensation and employee benefits of approximately 0.2 million offset by increase of approximately 0.1 million in outside research and development work and an increase of approximately 0.1 million in patent expenses. R&D expenses consist primarily of employee compensation and related fringe benefits, and other allocable overhead costs related to the research and development of our fuel. G&A expenses for the three months ended March 31, 2021, were $1.8 million. The G&A expenses were decreased by approximately $0.2 million for the three months ended March 31st, 2021 as compared to the three months ended March 31st, 2020. Due to a decrease in legal and professional fees of approximately 0.1 million related to the Framitone arbitration and a decrease in employee compensation and employee benefits of approximately 0.1 million. Net other operating income was $.1 million for the three months ended March 31st, 2021, due to the recognition of grant income from the first gain voucher. There was no grant income for the three months ended March 31st, 2020. Now over to you, Seth.

Thank you, Sherry. And with that, we will go to the question and answer session. Thank you to everyone who has submitted questions. Matt, please go ahead with questions.

Thank you, Seth. The first question, how does the recent co-extrusion announcement differ from your previous work?

Okay, Andre, you take that one.

Sure, Seth. The work we announced this week is different. We used our patented high-temperature co-extrusion process for our three-lob light bridge fuel design variants incorporating a central line displacer and using nuclear grade cladding alloy materials. These extrusions also include some specimens with intentional internal defects. They're going to perform certain type of non-destructive examination testing on those particular surrogate rods. The components produced from this work will enable light bridge to begin technically validating our finite element computer models of the fuel fabrication process, perform the corrosion testing on as-extruded cladding material needed for future licensing, and begin the development of non-destructive examination techniques for our fuel. These activities are part of our ongoing effort to qualify our manufacturing process and develop as fabricated specifications for our metallic fuel rod design that will ultimately be used to design and manufacture enriched uranium fuel rods for loop irradiation testing on a test reactor and commercial-length fuel rods for operation in a commercial reactor.

Thank you, Andrei. Our next question. Can you provide an update on where things stand today, one year later, in terms of the work to be done at INL?

Yeah, Jim's been in charge of that work. Jim, you want to take that one?

Yeah, sure, Seth. Yeah, as we previously mentioned, the ATR experiment design at the Idaho National Lab is moving forward with an expected completion date at the end of the third quarter of this year. We are nearing the completion of the conceptual phase of the experiment. What this means is that we will have a detailed specification for the fuel sample geometry, the enrichment levels of the coupons, the position of the sample capsules within the ATR core, and most importantly, the resident time of each capsule in the reactor. These factors are being optimized by INEL using an iterative neutronics and thermal hydraulics modeling approach with the goal of achieving the desired range of fuel burn-ups within a minimum amount of reactor time. Once completed, this conceptual phase will allow INEL to proceed with the development of the engineering and fabrication drawings and specifications for the capsules themselves and the fuel coupon samples. as well as to complete the safety case for sample insertion into the ATR. We have identified a potential target date in late 2022 or early 2023 for insertion following the ATR core internals change-out outage. And this date, of course, Target date, of course, depends upon the final schedule for the ATR outage as well as INAL's other commitments for reactor irradiations. In addition to completing the experiment design, we'll allow LightBridge to move forward with contracting for sample material and test coupon fabrication. And ultimately, this will allow us to perform post-radiation examination and measurement of the samples in collaboration with INAL. Back to you, Matt.

Thank you, Jim. Our next question, can you discuss which SMR or advanced reactor types might use light bridge fuel, and what reactor types may not be feasible, and do these designs have any application in the current power reactor fleet?

Jim, take that one.

Yes, yes, thanks again. Lightbridge fuel has a potential application in most water-cooled reactor types, including pressurized water, boiling water, and heavy water designs. Of the current SMR or advanced reactor designs, the most obvious application for our fuel would be in new-scale power module, the GE Hitachi VWX300, and in the Holtec SMR160. Other advanced designs, such as the TerraPower sodium fast reactor or the X-Energy XC100, which is a triso-fueled helium-cooled reactor, would not have a direct application for the current Lightbridge fuel design. However, these companies do share some synergies with Lightbridge in the areas of HALU supply and in metallic fuel fabrication. Excuse me. We have not completely explored the other advanced reactors such as molten salt or low power density graphite moderated designs, but these are less likely to have application for our current fuel. And finally, regarding the current power reactor fleet, most of the R&D efforts accomplished for water-cooled SMR designs will have some, if not a direct application, to the existing reactors. These include the current fleet of PWR, BWR, and CANDU plants. As such, we could still see a great potential to deploy the lightbridge fuel into the current fleet. Back to you again, Matt.

Thank you, Jim. From my understanding, lightbridge fuel uses uranium and zirconium. Do you have designs to use other materials?

Yes. We have done work on a version of our fuel utilizing plutonium and zirconium, and that technology is included in some of our patents that have been issued. This version of our fuel could be used to dispose of plutonium from dismantled nuclear weapons, utilizing in-reactor fuel to dispose of the plutonium, and this technology could also be used to produce power by disposing of reprocessed plutonium. from used reactor fuel. In the past, we designed a thorium uranium fuel that we also patented. We are no longer working on thorium fuel. The reason we are focusing on our metallic zirconium uranium fuel is that this design best addresses the needs of the market. It best provides the power up rates and longer fuel cycles that reduce the cost of electricity generated by reactors, and that's what utilities are looking for. And this fuel design also adds tremendous additional safety and non-proliferation benefits. Next question, Matt.

With the recent talk from the Biden administration supporting existing large reactors in the upcoming infrastructure bill, how can this be viewed as a benefit for Lightbridge?

Well, what I'd say is that energy production is crucial for infrastructure. And there is talk, as I mentioned earlier in the call, about, you know, apparently including talk by the Secretary of Energy, Jennifer Granholm, of production tax credits for nuclear power plants. And that type of support, plus the economic benefits of light bridge fuel, could significantly improve the economics of owning and operating nuclear power plants, large and small, keeping existing plants open that could use our fuel and lead to the construction of new reactors that could use our fuel, including, we believe, large numbers of SMRs. Next question.

This is our last question. Nuclear plants like at Indian Point are being shut down throughout the country. When do you think that the perception of nuclear will change to the better in this country?

Let's start today. If we are really going to meet IPCC climate goals, large growth in nuclear power has to be part of the answer. And if the U.S. is really going to compete in energy markets globally with China and Russia, advanced nuclear technology that the customers prefer has to be a part of the answer. Lightbridge's technology can help make nuclear power more acceptable. And with that being our last question, I'll say thank you, everybody, for participating on today's call. We look forward to providing additional updates in the near future. In the meantime, we can be reached at ir.ltbridge.com. Stay safe. Stay well. Goodbye.

That concludes today's conference call. Thank you for participating. You may now disconnect. Everyone have a great day. Thank you. you Music. Bye. Thank you. Thank you. you Thank you for standing by and welcome to the LightBridge Corporation business update and first quarter 2021 conference call. Please note that today's call is being recorded. It is now my pleasure to introduce Matthew Avenatti, Director of Investor Relations for LightBridge Corporation.

Thank you, Catherine, and thanks to all of you for joining us today. The company's earnings release was distributed after the market closed yesterday. and can be viewed on the Investor Relations page of the Lightbridge website at www.ltbridge.com. Joining us on the call today is Seth Gray, Chief Executive Officer, along with Larry Goldman, Chief Financial Officer, Sherry Holloway, Accounting Manager, Andrei Mushikov, Executive Vice President for Nuclear Operations, and Jim Fornoff, Vice President for Nuclear Program Management. I would like to remind our listeners that any statements on this call that are not historical facts are forward-looking statements. Today's presentation includes forward-looking statements about the company's competitive position and product and service offerings. During today's call, words such as expect, anticipate, believe, and intend will be used in our discussion of goals or events in the future. This presentation is based on current expectations and involves certain risks and uncertainties that may cause actual results to differ significantly from such estimates. These and other risks are set forth in more detail in LightBridge's filing with the Securities and Exchange Commission. LightBridge does not assume any obligation to update or revise any such forward-looking statements, whether as a result of new developments or otherwise. And with that, I would like to turn the call over to our first speaker, Seth Gray, Chief Executive Officer of LightBridge. Hello, Seth.

Well, hello, Matt, and thank you. Thank you all for joining us to discuss LightBridge's first quarter 2021 results. We enter 2021 on a very positive trajectory in terms of our fuel development activities, highlighted by our announcement yesterday that we have successfully demonstrated our proprietary manufacturing process for three-lobe, six-foot rods using surrogate materials. The surrogate rods were manufactured through our co-extrusion process at a length designed for small modular reactors, or SMRs. Andrei Mushakov will provide an overview of this process after my remarks. This manufacturing is important for LightBridge for many reasons. We are beginning to physically produce rods utilizing our technology. Between production of rods and our two gain vouchers, this is all beginning to move to tangible products that are backed by our extensive patent portfolio. We are designing light bridge fuel to enable small modular reactors to more efficiently load follow, ramping up and down in power as renewables are available, replacing fossil fuel plants. In addition, we expect this technology to reduce the cost of generating electricity from an SMR which strengthens the business case for deploying large numbers of SMRs to deliver reliable power and meet climate goals. Our development steps are also applicable to the existing large light water reactors. Last month, DOE awarded LightBridge a second gain funding voucher to support development of LightBridge fuel in collaboration with the Pacific Northwest National Laboratory, PNNL. The scope of the project is to demonstrate LightBridge's casting process using depleted uranium, a key step in the manufacture of LightBridge fuel. The total project value is approximately $664,000 with three-quarters of this amount funded by DOE for the scope performed by PNNL. We expect the project will begin later this quarter. We are pleased with our ongoing efforts at Idaho National Lab, or INL, performing under our funding voucher from the Department of Energy's GAIN program. We are designing an experiment for testing our fuel samples in the Advanced Test Reactor at INL. We anticipate our work under this voucher will be completed in the second half of this year. Being awarded two funding vouchers by the federal government through the DOE with access to their teams of experts and world-class facilities, which are unmatched in the private sector, allows LightBridge to take meaningful strides in our fuel development program. In addition, these funding awards further validate our patented fuel and patented manufacturing process, fitting in strategically with the goals of the federal government. We are seeing an increasing understanding in the Biden administration that nuclear energy must increase to meet the administration's zero emission goals. In fact, you may have seen news reports that tax subsidies for existing nuclear facilities might be included in the upcoming infrastructure bill. It's becoming clearer that there is a paradigm shift in the way governments around the world are looking at nuclear power. In the last year, the U.S. government, through the Nuclear Fuel Working Group, outlined a bold plan that commits to federal funding of R&D for advanced nuclear energy, as well as lifting of the ban on investment by the U.S. International Development Finance Corporation into advanced nuclear energy projects for export. From there, the Nuclear Energy Leadership Act was included as an amendment to the National Defense Authorization Act that passed last fall, focusing DOE efforts on demonstration of advanced reactor concepts, including nuclear fuel technology. And this month, the European Commission announced that it will include nuclear energy in the European Union taxonomy regulation, which steers investment into low-carbon projects. All of these developments matter in setting the stage for attracting greater investment in nuclear energy technology development. Investors in nuclear tend to follow government actions when leveraging their investments, so we expect these changes will lead to more meaningful investment in the nuclear power industry. Lightbridge presents a unique opportunity in the nuclear industry. Our fuel design marks the only truly new fuel design since the dawn of light-water reactors in the nuclear industry. These are significant changes that will bring significant safety and economic benefits for both existing and new reactors. In many ways, light-bridge fuel can help the nuclear power industry reduce the costs of generating electricity and operating nuclear plants. Over the long run, we expect a transition from most nuclear energy being generated in large reactors to much more generation from larger numbers of small, modular reactors powered by light bridge fuels, offering superior ramp rates for load following with renewables, while providing a meaningful increase in power output. And with that, I will turn the call over to Andrei Mushakov, Executive VP for Nuclear Operations, who will update us on some recent news and review our near-term research and development opportunities. Andrei.

Thank you, Seth. Yesterday, we announced the successful demonstration of our patented core extrusion process using surrogate materials in place of uranium. The surrogate rods were manufactured using our core extrusion process at the six-foot nominal lengths designed for small modular reactors, or SMRs. This successful demonstration of our high-temperature core extrusion illustrates the primary performing process for light-bridge fuel including the helical twist of the fuel rods and the metallurgical bond between the central displacer, surrogate fuel alloy, and the cladding. Rods produced during this demonstration will be used for further development activities, including validation of computer models of the extrusion process and corrosion testing of as fabricated cladding alloys. In parallel, we continue to make progress on our advanced test reactor experiment design with Idaho National Laboratory. We are nearing the completion of the conceptual design phase in which our INL colleagues have been optimizing a combination of design elements in order to achieve burn-up of the fuel samples within the defined window of time in the test reactor. Once the conceptual phase is complete, Idaho National Laboratory will immediately begin the detailed design and safety case for the experiment. We expect the experiment design to be completed later this calendar year. Completion of the ATR experiment design will also allow us to finalize the scopes of work with Idaho National Laboratory for high SEL uranium supply, coupon sample fabrication, reactor radiation, and ultimately post-radiation examination of the samples. We are also progressing on the contracting and quality control aspects of our second gain voucher with the Pacific Northwest National Laboratory for demonstration of our fuel casting process using depleted uranium in a 50% weight percent alloy with zirconium. This is a key step in the fabrication process for our fuel, and it also feeds into our needs for fabrication of irradiation fuel samples for the advanced test reactor at Idaho National Laboratory. Again, contracts with PNNL are almost complete, and we expect to be able to execute these contracts with the National Lab shortly. We have also begun the quotation on quality assurance process with our sub-vendors for the supply of depleted uranium and zirconium materials, which is a component of LightBridge's mentioned contribution to the project. The total value of the project is approximately $664,000, the three-quarters of this amount funded by DOE for the scope performed by Pacific Northwest National Laboratory. Back to you, Seth.

Thank you, Andre. Now we'll turn the call over to Larry Goldman, Chief Financial Officer, to summarize the company's financial results. Larry?

Thank you, Seth, and good afternoon, everyone. For further information regarding our first quarter 2021 financial results and disclosures, please refer to our earnings release that we filed at the close of market yesterday, and our Form 10-Q that we will file with the SEC later today. The company maintained a strong working capital position at March 31, 2021, with $15.2 million of cash and cash equivalents compared to $21.5 million at December 31, 2020. We had working capital of $15.2 million at March 31, 2021, as compared to $17.1 million at December 31, 2020, with no debt financing. Total assets were $15.9 million, and total liabilities were $0.6 million at March 31, 2021. Total cash used in operating activities was $6.3 million, an increase of approximately $4.3 million for the three months ended March 31, 2021, compared to the three months ended March 31st, 2020. This increase was due primarily to the dissolution of the Envision Joint Venture and the payment of approximately 4.2 million to Framatone for outstanding invoices for work performed and other expenses incurred by Framatone. Cash provided by financing activities decreased by approximately 0.4 million for the first quarter of 2021 as compared to the first quarter of 2020. This decrease was due to the decrease in cash proceeds from the issuance of our common stock, as we did not raise any equity capital for the three months ended March 31, 2021. In support of our long-term business and future finance with respect to our fuel development, we expect to continue to seek additional DOE funding in the future, along with new strategic alliances that may contain cost-sharing projects contributions, and other additional funding from others in order to help fund our future R&D milestones, leading to the commercialization of our Lightbridge fuel. I will now turn the call over to Sherry Holloway, our accounting manager, who will go over select P&L financial information for the first quarter of 2021. Sherry?

Thank you, Larry. Net loss for the first quarter of 2021. was $2 million compared to $2.3 million for the first quarter of 2020, primarily due to these factors. Total R&D expenses were $0.4 million in the first quarter of 2021 compared to $0.4 million in the first quarter of 2020. Expenses were consistent period over period as we transitioned to a new fuel development strategy with the DOE national laboratories. There was a decrease in employee compensation and employee benefits of approximately 0.2 million offset by increase of approximately 0.1 million in outside research and development work and an increase of approximately 0.1 million in patent expenses. R&D expenses consist primarily of employee compensation and related fringe benefits, and other allocable overhead costs related to the research and development of our fuel. G&A expenses for the three months ended March 31, 2021, were $1.8 million. The G&A expenses were decreased by approximately $0.2 million for the three months ended March 31st, 2021 as compared to the three months ended March 31st, 2020. Due to a decrease in legal and professional fees of approximately 0.1 million related to the Framitone arbitration and a decrease in employee compensation and employee benefits of approximately 0.1 million. Net other operating income was $.1 million for the three months ended March 31st, 2021, due to the recognition of grant income from the first game voucher. There was no grant income for the three months ended March 31st, 2020. Now over to you, Seth.

Thank you, Sherry. And with that, we will go to the question and answer session. Thank you to everyone who has submitted questions. Matt, please go ahead with questions.

Thank you, Seth. The first question, how does the recent co-extrusion announcement differ from your previous work?

Okay, Andre, you take that one.

Sure, Seth. The work we announced this week is different. We used our patented high temperature co-extrusion process for our three-lob light bridge fuel design variants incorporating a central line displacer and using nuclear grade cladding alloy materials. These extrusions also include some specimens with intentional internal defects. They're going to perform certain type of non-destructive examination testing on those particular surrogate rods. The components produced from this work will enable light bridge to begin technically validating our finite element computer models of the fuel fabrication process, perform the corrosion testing on as extruded cladding material needed for future licensing, and begin the development of non-destructive examination techniques for our fuel. These activities are part of our ongoing efforts to qualify our manufacturing process and develop as-fabricated specifications for our metallic fuel rod design that will ultimately be used to design and manufacture enriched uranium fuel rods for loop irradiation testing on a test reactor and commercial-length fuel rods for operation in a commercial reactor.

Thank you, Andre. Our next question. Can you provide an update on where things stand today, one year later, in terms of the work to be done at INL?

Yeah, Jim's been in charge of that work. Jim, you want to take that one?

Yeah, sure, Seth. Yeah, as we previously mentioned, the ATR experiment design at the Idaho National Lab is moving forward with an expected completion date at the end of the third quarter of this year. We are nearing the completion of the conceptual phase of the experiment. What this means is that we will have a detailed specification for the fuel sample geometry, the enrichment levels of the coupons, the position of the sample capsules within the ATR core, and most importantly, the resident time of each capsule in the reactor. And these factors are being optimized by INEL using an iterative neutronics and thermal hydraulics modeling approach with the goal of achieving the desired range of fuel burn-ups within a minimum amount of reactor time. Once completed, this conceptual phase will allow INEL to proceed with the development of the engineering and fabrication drawings and specifications for the capsules themselves and the fuel coupon samples. as well as to complete the safety case for sample insertion into the ATR. We have identified a potential target date in late 2022 or early 2023 for insertion following the ATR core internals change-out outage. And this date, of course, Target date, of course, depends upon the final schedule for the ATR outage as well as INAL's other commitments for reactor irradiations. In addition to completing the experiment design, we'll allow LightBridge to move forward with contracting for sample material and test coupon fabrication. And ultimately, this will allow us to perform post-radiation examination and measurement of the samples in collaboration with INAL. Back to you, Matt.

Thank you, Jim. Our next question, can you discuss which SMR or advanced reactor types might use light bridge fuel, and what reactor types may not be feasible, and do these designs have any application in the current power reactor fleet?

Jim, take that one.

Yes, yes, thanks again. Lightbridge fuel has a potential application in most water-cooled reactor types, including pressurized water, boiling water, and heavy water designs. Of the current SMR or advanced reactor designs, the most obvious application for our fuel would be in new-scale power module, the GE Hitachi VWX300, and in the Holtec SMR160. Other advanced designs, such as the TerraPower sodium fast reactor or the X-Energy XC100, which is a triso-fueled helium-cooled reactor, would not have a direct application for the current Lightbridge fuel design. However, these companies do share some synergies with Lightbridge in the areas of HALU supply and in metallic fuel fabrication. Excuse me. We have not completely explored the other advanced reactors such as molten salt or low power density graphite moderated designs, but these are less likely to have application for our current fuel. And finally, regarding the current power reactor fleet, most of the R&D efforts accomplished for water-cooled SMR designs will have some, if not a direct application, to the existing reactors. And these include the current fleet of PWR, BWR, and CANDU plants. As such, we can still see a great potential to deploy the lightbridge fuel into the current fleet. Back to you again, Matt.

Thank you, Jim. From my understanding, lightbridge fuel uses uranium and zirconium. Do you have designs to use other materials?

Yes. We have done work on a version of our fuel utilizing plutonium and zirconium, and that technology is included in some of our patents that have been issued. This version of our fuel could be used to dispose of plutonium from dismantled nuclear weapons, utilizing in-reactor fuel to dispose of the plutonium, and this technology could also be used to produce power by disposing of reprocessed plutonium. from used reactor fuel. In the past, we designed a thorium uranium fuel that we also patented. We are no longer working on thorium fuel. The reason we are focusing on our metallic zirconium uranium fuel is that this design best addresses the needs of the market. It best provides the power up rates and longer fuel cycles that reduce the cost of electricity generated by reactors, and that's what utilities are looking for. And this fuel design also adds tremendous additional safety and non-proliferation benefits. Next question, Matt.

With the recent talk from the Biden administration supporting existing large reactors in the upcoming infrastructure bill, how can this be viewed as a benefit for LightBridge?

Well, what I'd say is that energy production is crucial for infrastructure. And there is talk, as I mentioned earlier in the call, about, you know, apparently including talk by the Secretary of Energy, Jennifer Granholm, of production tax credits for nuclear power plants. And that type of support, plus the economic benefits of light bridge fuel, could significantly improve the economics of owning and operating nuclear power plants, large and small, keeping existing plants open that could use our fuel and lead to the construction of new reactors that could use our fuel, including, we believe, large numbers of SMRs. Next question.

This is our last question. Nuclear plants like at Indian Point are being shut down throughout the country. When do you think that the perception of nuclear will change to the better in this country?

Let's start today. If we are really going to meet IPCC climate goals, large growth in nuclear power has to be part of the answer. And if the U.S. is really going to compete in energy markets globally with China and Russia, advanced nuclear technology that the customers prefer has to be a part of the answer. Lightbridge's technology can help make nuclear power more acceptable. And with that being our last question, I'll say thank you, everybody, for participating on today's call. We look forward to providing additional updates in the near future. In the meantime, we can be reached at ir.ltbridge.com. Stay safe. Stay well. Goodbye.

That concludes today's conference call. Thank you for participating. You may now disconnect. Everyone have a great day.