REEMF 8-K
Rare Element Resources Ltd (REEMF)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On June 30, 2024, the board of directors (the “Board”) of Rare Element Resources Ltd. (the “Registrant”), appointed Kelli Kast as the Vice President, General Counsel and Chief Administrative Officer of the Registrant, in each case effective as of July 1, 2024. In connection with the officer appointment, on June 30, 2024, the Board and Ms. Kast, a director of the Registrant, agreed that she would not stand for re-election as a director of the Registrant at its 2024 annual meeting of shareholders. The decision not to stand for re-election as a director was not because of any disagreement with the Registrant on any matter relating to its operations, policies or practices.
Ms. Kast, 57, has over 25 years of in-house legal experience, including as top legal officer in the precious metals industry for seven years and 12 years in the rare earth industry. She has served as a consultant of Rare Element Resources, Inc., a wholly owned subsidiary of the Registrant (the “Company”), since June 2015, and as a director of the Registrant since August 2022. From July 2012 to May 2015, Ms. Kast served as the Vice President, General Counsel, Chief Administrative Officer and Corporate Secretary of the Registrant. She served as Coeur d’Alene Mine Corporation’s Vice President, General Counsel and Corporate Secretary from May 2005 to March 2009 and as its Chief Administrative Officer from March 2009 to December 2011. From 2004 to 2005, Ms. Kast served as Corporate Counsel for HealtheTech Inc. From 1997 to 2003, she served as the Assistant General Counsel and Corporate Secretary for Global Water Technologies Inc. and Psychrometric Systems, Inc. From January 1996 through December 1997, she served as corporate counsel for Boise Cascade Corporation. Ms. Kast earned her Juris Doctor from the University of South Dakota School of Law and her Bachelor’s degree from the University of Idaho.
On July 1, 2024, the Company and Ms. Kast entered into an employment agreement (the “Employment Agreement”), which provides that (i) Ms. Kast’s initial annual base salary is US$310,000; (ii) Ms. Kast will be eligible to receive an annual performance bonus and such long-term incentive awards as may be determined by the Board; and (iii) she will be eligible to participate in the employee benefit programs of the Registrant.
Pursuant to the terms of the Employment Agreement, Ms. Kast is entitled to separation benefits in the event that her employment is terminated by the Company without “cause” (as defined in the Employment Agreement) or by Ms. Kast for “good reason” (as defined in the Employment Agreement), including a material change in title or duties, a material reduction in base salary unless a proportionate reduction is made to the base salary of all members of the Company Group’s (as defined in the Employment Agreement) senior management team in certain circumstances, a material breach of the Employment Agreement by the Company, or the failure by the Company to maintain reasonable directors and officers liability insurance acceptable to the Company’s Board, in each case which the Company has failed to cure. The severance payment to be received by Ms. Kast upon termination under the circumstances described above will be equal to sum of one year of her base salary in effect on the date of termination and certain accrued and unpaid benefits, all paid to her in a lump sum on the sixtieth (60th) day after the date of such termination.
Pursuant to the terms of the Employment Agreement, Ms. Kast will be indemnified by the Company for all losses, settlements and other amounts arising from all claims or proceedings in which she may be involved relating to the business or affairs of the Company if in each case she acted in good faith and in a manner that she believed to be in the best interest of the Company, and her conduct did not constitute gross negligence or willful or wanton misconduct. In addition, during the term of Ms. Kast’s employment and for six years after her employment terminates, or so long as the Company’s directors and officers liability insurance or indemnification policy (the “D&O Policy”) remains in effect, whichever period is shorter, Ms. Kast will be entitled to coverage under the D&O Policy.
As consideration for the separation benefits under the Employment Agreement, Ms. Kast agreed to certain confidentiality obligations with respect to proprietary information of the Company Group gained as a result of her employment. In addition, she is subject to non-compete provisions under the Employment Agreement that prohibit her from engaging in any “competitive business” (as defined in the Employment Agreement) during the term of the Employment Agreement or for a period of one year following termination within certain geographical boundaries based on the locations where the Company does business, unless Ms. Kast is terminated by the Company without cause. Ms. Kast is also prohibited during the term of the Employment Agreement and for one year following termination from soliciting the services of any employee of or consultant to the Company Group or the business of any customer of the Company Group.
The foregoing description of the Employment Agreement is qualified in its entirety by the terms of the Employment Agreement, a copy of which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.
Item 9.01Financial Statements and Exhibits.
(d)Exhibits.
Exhibit | Description | |
|---|---|---|
10.1* | ||
104 | Cover Page Interactive Data File (formatted in Inline XBRL and included as Exhibit 101) |
*Indicates a management contract or compensatory plan, contract or arrangement.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: July 2, 2024
RARE ELEMENT RESOURCES LTD. | ||
By: | /s/ Wayne E. Rich | |
Name: | Wayne E. Rich | |
Title: | Chief Financial Officer | |
Exhibit 10.1
EMPLOYMENT AGREEMENT
This Employment Agreement (this “Agreement”) is made and entered into this 1st day of July, 2024 by and between Kelli Kast (the “Employee”) and Rare Element Resources, Inc., a Wyoming corporation (the “Company”).
RECITALS
WHEREAS, the Employee has served the Company in various capacities since July 2012, including as a consultant, employee and director; and
WHEREAS, Employee desires to be employed as the Vice President, General Counsel and Chief Administrative Officer of the Company, and the Company wishes to employ the Employee in such capacity effective as of July 1, 2024 (the “Effective Date”); and
WHEREAS, the Company desires the Employee to additionally serve as the Vice President, General Counsel and Chief Administrative Officer of its parent company Rare Element Resources, Ltd.; and
WHEREAS, the Company and the Employee wish to enter into this Agreement to memorialize the terms and conditions of the Employee’s employment.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises, covenants and agreements contained herein, the parties agree as follows:
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[Signature Page to Follow]
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IN WITNESS WHEREOF, the parties hereto have entered into this Agreement effective as of the date first above written.
THE COMPANY
RARE ELEMENT RESOURCES, INC.
By:/s/ Ken Mushinski
Name: Ken Mushinski
Title: President and CEO
THE EMPLOYEE
/s/ Kelli Kast
Kelli Kast
[Signature Page To Employment Agreement]
EXHIBIT A
GENERAL RELEASE OF CLAIMS
This General Release (this “Release”) is entered into as of this ____ day of __________, 20__, by and between Kelli Kast (the “Employee”) and Rare Element Resources, Inc. (the “Company”) (collectively, the “Parties”).
WHEREAS, the Employee is a party to that certain Employment Agreement, effective as of July 1, 2024 (the “Agreement”), governing the terms and conditions applicable to the Employee’s termination of employment under certain circumstances;
WHEREAS, pursuant to the terms of the Agreement, the Company has agreed to provide the Employee certain benefits and payments under the terms and conditions specified therein, provided that the Employee has executed and not revoked a general release of claims in favor of the Company and certain of its affiliates and related parties; and
WHEREAS, the Parties wish to terminate their relationship amicably and to resolve, fully and finally, all actual and potential claims and disputes relating to the Employee’s employment with and termination from the Company and all other relationships between the Employee and the Company, up to and including the date of execution of this Release.
NOW, THEREFORE, in consideration of these recitals above and the promises and mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are expressly acknowledged, the Parties, intending to be legally bound, agree as follows:
1. | Termination of Employee. The Employee’s employment with the Company shall terminate on __________, 20__ (the “Termination Date”). |
2. | Severance Benefits. Pursuant to the terms of the Agreement, and in consideration of the Employee’s release of claims and the other covenants and agreements contained herein and therein, and provided that the Employee has signed this Release and delivered it to the Company and has not exercised any revocation rights as provided in Section 6 below, the Company shall provide the severance benefits described in Section 7.2 of the Agreement (the “Benefits”) in the time and manner provided therein; provided, however, that the Company’s obligations will be excused if the Employee breaches any of the provisions of the Agreement, including, without limitation, Section 9 thereof. The Employee acknowledges and agrees that the Benefits constitute consideration beyond that which, but for the mutual covenants set forth in this Release and the covenants contained in the Agreement, the Company otherwise would not be obligated to provide, nor would the Employee otherwise be entitled to receive. |
3. | Effective Date. Provided that it has not been revoked pursuant to Section 6 hereof, this Release will become effective on the eighth (8th) day after the date of its execution by the Employee (the “Effective Date”). |
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4. | Effect of Revocation. The Employee acknowledges and agrees that if the Employee revokes this Release pursuant to Section 6 hereof, the Employee will have no right to receive the Benefits. |
5. | General Release. In consideration of the Company’s obligations, the Employee hereby releases, acquits and forever discharges the Company and each of its parent, subsidiaries and affiliates and each of their respective officers, employees, directors, successors and assigns (collectively, the “Released Parties”) from any and all claims, actions or causes of action in any way related to her employment with the Company or the termination thereof, whether arising from tort, statute or contract, including, but not limited to, claims of defamation, claims arising under the Employee Retirement Income Security Act of 1974, as amended, the Age Discrimination in Employment Act of 1967, as amended by the Older Workers Benefit Protection Act of 1990, Title VII of the Civil Rights Act of 1964, as amended, the Americans with Disabilities Act, the Family and Medical Leave Act, the discrimination and wage payment laws of any state, and any other federal, state or local statutes or ordinances of the United States, it being the Employee’s intention and the intention of the Company to make this Release as broad and as general as the law permits. Notwithstanding the foregoing, the parties understand that this Release does not waive any of Employee’s rights or claims (i) that may arise after his execution of this Release, or (ii) for payments owed to Employee pursuant to the terms hereof. |
6. | Review and Revocation Period. The Employee acknowledges that the Company has advised the Employee that the Employee may consult with an attorney of the Employee’s own choosing (and at the Employee’s expense) prior to signing this Release and that the Employee has been given at least forty-five (45) days during which to consider the provisions of this Release, although the Employee may sign and return it sooner. The Employee further acknowledges that the Employee has been advised by the Company that after executing this Release, the Employee will have seven (7) days to revoke this Release, and that this Release shall not become effective or enforceable until such seven (7)-day revocation period has expired. The Employee acknowledges and agrees that if the Employee wishes to revoke this Release, the Employee must do so in writing, and that such revocation must be signed by the Employee and received by the Secretary of the Company or the Chairman of the Board of Directors of Rare Element Resources Ltd. no later than 5:00 p.m. Pacific Time on the seventh (7th) day after the Employee has executed this Release. The Employee further acknowledges and agrees that, in the event that the Employee revokes this Release, the Employee will have no right to receive any benefits hereunder, including the Benefits. The Employee represents that the Employee has read this Release and understands its terms and enters into this Release freely, voluntarily and without coercion. |
7. | Confidentiality, Non-Compete and Non-Solicitation. The Employee reaffirms Employee’s commitments in Section 9 of the Agreement. |
8. | Cooperation in Litigation. At the Company’s reasonable request, the Employee shall use good faith efforts to cooperate with the Company, its affiliates, and each of its and their respective attorneys or other legal representatives (“Attorneys”) in connection with any claim, litigation or judicial or arbitral proceeding which is material to the Company or its |
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affiliates and is now pending or may hereinafter be brought against the Released Parties by any third party; provided that, the Employee’s cooperation is essential to the Company’s case. The Employee’s duty of cooperation will include, but not be limited to (a) meeting with the Company’s and/or its affiliates’ Attorneys by telephone or in person at mutually convenient times and places in order to state truthfully the Employee’s knowledge of matters at issue and recollection of events; (b) appearing at the Company’s, its affiliates’ and/or their Attorneys’ request (and, to the extent possible, at a time convenient to the Employee that does not conflict with the needs or requirements of the Employee’s then-current employer) as a witness at depositions or trials, without necessity of a subpoena, in order to state truthfully the Employee’s knowledge of matters at issue; and (c) signing at the Company’s, its affiliates’ and/or their Attorneys’ request, declarations or affidavits that truthfully state matters of which the Employee has knowledge. The Company shall reimburse the Employee for the reasonable expenses incurred by him in the course of her cooperation hereunder and shall pay to the Employee per diem compensation in an amount equal to the daily prorated portion of the Employee’s base salary immediately prior to the Termination Date. The obligations set forth in this Section 8 shall survive any termination or revocation of this Release.
9. | Non-Admission of Liability. Nothing in this Release will be construed as an admission of liability by the Employee or the Released Parties; rather, the Employee and the Released Parties are resolving all matters arising out of the employer–employee relationship between the Employee and the Company and all other relationships between the Employee and the Released Parties. |
10. | Nondisparagement. The Employee agrees not to make negative comments or otherwise disparage the Company or its officers, directors, employees, shareholders or agents, in any manner likely to be harmful to them or their business, business reputation or personal reputation. The Company agrees that the members of the Company’s board and officers of the Company as of the date hereof will not, while employed by the Company or serving as a director of the Company, as the case may be, make negative comments about the Employee or otherwise disparage the Employee in any manner that is likely to be harmful to the Employee’s business or personal reputation. The foregoing shall not be violated by truthful statements in response to legal process or required governmental testimony or filings, and the foregoing limitation on the Company’s directors and officers will not be violated by statements that they in good faith believe are necessary or appropriate to make in connection with performing their duties for or on behalf of the Company. |
11. | Binding Effect. This Release will be binding upon the Parties and their respective heirs, administrators, representatives, executors, successors and assigns, and will inure to the benefit of the Parties and their respective heirs, administrators, representatives, executors, successors and assigns. |
12. | Governing Law. This Release will be governed by and construed and enforced in accordance with the laws of Colorado applicable to agreements negotiated, entered into and wholly to be performed therein, without regard to its conflicts of law or choice of law provisions which would result in the application of the law of any other jurisdiction. |
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13. | Severability. Each of the respective rights and obligations of the Parties hereunder will be deemed independent and may be enforced independently irrespective of any of the other rights and obligations set forth herein. If any provision of this Release should be held illegal or invalid, such illegality or invalidity will not affect in any way other provisions hereof, all of which will continue, nevertheless, in full force and effect. |
14. | Counterparts. This Release may be signed in counterparts. Each counterpart will be deemed to be an original, but together all such counterparts will be deemed a single agreement. |
15. | Entire Agreement; Modification. This Release constitutes the entire understanding between the Parties with respect to the subject matter hereof and may not be modified without the express written consent of both Parties. This Release supersedes all prior written and/or oral and all contemporaneous oral agreements, understandings and negotiations regarding its subject matter. This Release may not be modified or canceled in any manner except by a writing signed by both Parties. |
16. | Acceptance. The Employee may confirm acceptance of the terms and conditions of this Release by signing and returning two (2) original copies of this Release to the Secretary or the Chairman of the Board of Directors of Rare Element Resources, Ltd., no later than 5:00 p.m. Pacific Time forty-five (45) days after the Employee’s Termination Date. |
THE EMPLOYEE ACKNOWLEDGES AND REPRESENTS THAT THE EMPLOYEE HAS FULLY AND CAREFULLY READ THIS RELEASE PRIOR TO SIGNING IT AND UNDERSTANDS ITS TERMS. THE EMPLOYEE FURTHER ACKNOWLEDGES AND AGREES THAT THE EMPLOYEE HAS BEEN, OR HAS HAD THE OPPORTUNITY TO BE, ADVISED BY INDEPENDENT LEGAL COUNSEL OF THE EMPLOYEE’S OWN CHOICE AS TO THE LEGAL EFFECT AND MEANING OF EACH OF THE TERMS AND CONDITIONS OF THIS RELEASE, AND IS ENTERING INTO THIS RELEASE FREELY AND VOLUNTARILY AND NOT IN RELIANCE ON ANY PROMISES OR REPRESENTATIONS OTHER THAN AS SET FORTH IN THIS RELEASE.
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IN WITNESS WHEREOF, the Company and the Employee have duly executed this Release as of the date first above written.
THE COMPANY
RARE ELEMENT RESOURCES, INC.
By:
Name:
Title:
THE EMPLOYEE
Kelli Kast
[Signature Page to General Release of Claims]