RARE ELEMENT RESOURCES LTD. (OTCMKTS:REEMF) Files An 8-K Entry into a Material Definitive AgreementItem 1.01
Entry into a Material Definitive Agreement.
On August18, 2017, Rare Element Resources Ltd. (the “Company”) and General Atomics Uranium Resources, LLC, a Delaware limited liability company, executed a term sheet for the purchase of common shares of the Company, an option, and intellectual property rights (the “Term Sheet”). The Term Sheet provides that, upon the terms and subject to the conditions set forth in the Term Sheet, among other things, (i)General Atomics Uranium Resources, LLC or one or more of its affiliates (“General Atomics”) will pay $500,000 in cash (the “Preliminary Payment”) to the Company within three business days of the execution of the Term Sheet; (ii)the Company and General Atomics will enter into an investment agreement (the “Investment Agreement”) to which General Atomics will acquire 26,650,000 common shares of the Company (the “Acquired Shares”), which constitute approximately 33.5% of the fully-diluted common shares issued and outstanding, for $4,752,000 in cash, less the Preliminary Payment, at the closing of the transactions contemplated by the Investment Agreement (the “Acquired Shares Closing”); (iii)the Company will grant General Atomics an option (the “Option”) to purchase an additional 24,175,000 common shares of the Company, which, together with the Acquired Shares, would constitute approximately 49.0% of the fully diluted common shares issued and outstanding; and (iv)the Company and General Atomics will enter into an intellectual property rights agreement to which General Atomics will be granted certain rights to the Company’s intellectual property relating to rare earth processing and separation. The Option will be exercisable until the fourth anniversary following the purchase of the Acquired Shares, and the total exercise price of the Option will be $5,040,000 in cash. If an Investment Agreement is not executed between the Company and General Atomics, the Company will be obligated to issue 3,125,000 common shares to General Atomics within five business days of the termination of the 90-day exclusivity period. The Term Sheet has been approved by the Company’s board of directors.
The Term Sheet contains customary representations by the Company as well as other customary provisions for a transaction of this nature. The transfer, sale or exchange of common shares of the Company to the Term Sheet is exempt from registration as a private placement under Section4(a)(2) of the Securities Act of 1933, as amended, and Rule506 promulgated thereunder, among other exemptions.
The parties expect the Investment Agreement and related transaction documents to be signed, and the transactions contemplated thereby closed, by September30, 2017, subject to customary conditions precedent.
Item 1.01
Unregistered Sales of Equity Securities.
The information set forth in Item 1.01 is incorporated herein by reference.
Item 1.01
Other Events.
On August 21, 2017, the Company issued a press release relating to the execution of the Term Sheet. A copy of the press release is attached hereto as Exhibit99.1.
Item 1.01
Financial Statements and Exhibits.
(d)
Exhibits.
See Exhibit Index.
RARE ELEMENT RESOURCES LTD ExhibitEX-99 2 ex99.htm NEWS RELEASE Exhibit 99.1 Exhibit 99.1 NEWS RELEASE RARE ELEMENT RESOURCES LTD. OTCQB: REEMF August 21,…To view the full exhibit click here
About RARE ELEMENT RESOURCES LTD. (OTCMKTS:REEMF)
Rare Element Resources Ltd. is a mineral resource company. The Company’s Bear Lodge Property consists of two projects: Bear Lodge Rare Earth Element (REE) Project and the Sundance Gold Project. It is focused on advancing REE Project located near the town of Sundance in northeast Wyoming. It operates through the exploration of mineral properties segment. The Bear Lodge REE Project consists of the Bull Hill Mine, inclusive of the Bull Hill and Whitetail Ridge deposits and the exploration targets of East Taylor and Carbon, all of which are located near Sundance, Wyoming. The Bear Lodge REE Project comprises several REE resource areas within the Bear Lodge Property. The identified REE deposits and occurrences within the Bear Lodge alkaline complex are contained within the Company’s block of unpatented lode mining claims. The Sundance Gold Project is the second project located on its Bear Lodge Property. This property contains gold mineralization.
