Professional Services Agreement, dated as of January 16, 2023, by and between Rare Element Resources, Inc. and Jaye Pickarts
Rare Element Resources Inc.
Exhibit 10.2
Professional Services Agreement
This Professional Services Agreement (“Agreement”) dated this 16th day of January 2023 and made effective as of January 1, 2023 (“Effective Date”), is by and between Rare Element Resources Inc. a Wyoming corporation ("RER" or “Company”), and Jaye T. Pickarts, P.E. whose address is 9792 West Unser Ave, Littleton, Colorado 80128 (the “Consultant”).
Whereas, RER has previously retained Consultant to perform professional consulting services for RER; and
Whereas, RER desires to further retain Consultant pursuant to an updated agreement consistent with the terms and conditions contained herein; and
Whereas, Consultant represents that he is qualified and desires to perform the professional services requested by RER, and that he has the professional business skills to bring to RER on a contracted, non-exclusive basis; and
Whereas, the Consultant agrees to perform services for RER upon the terms and conditions set forth in this Agreement.
NOW THEREFORE, the parties hereby enter into this Agreement to set forth their mutual promises and understandings, and mutually acknowledge the receipt and sufficiency of valuable consideration in addition to the mutual promises, conditions and understandings set forth below.
The parties hereby agree as follows:
1. | Performance of Services. The Consultant shall perform the professional consultancy services described on the attached Exhibit A: Description of Services and such other services as are requested by RER from time to time (the “Services”). All Services performed by Consultant shall be in strict accordance with Exhibit A and any written instructions to Consultant from RER from time to time. |
2. | Fees and Reimbursable Services. RER shall pay the Consultant for the Services at a rate set forth on Exhibit A: Description of Services |
As further set forth in Exhibit A: Description of Services, all reimbursable expenses, including pre-approved travel, mileage, meals and other engagement-related expenses will be reimbursed at actual cost only with no mark-up. Examples of reimbursable expenses are set forth in the attached Exhibit A. Expenses must be approved by RER in advance and will be billed separately from Consultant service invoices. The Consultant shall not purchase any equipment necessary to provide the Services which has a cost in excess of $25.00 without the prior written approval from RER.
3. | Invoices. The Consultant shall invoice RER monthly pursuant to the billing rate set forth in Exhibit A. Invoices shall be submitted timely as requested by the accounting contact at RER. Consultant shall submit reimbursable expenses on the RER approved expense reimbursement form as provided by RER. RER will pay the Consultant within twenty working days following invoice approval, which shall be no longer than 5 days following receipt, unless RER notifies Consultant within such 5-day period of an objection to the invoice. |
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4. | Scope of Services. It is understood that Consultant shall provide consultancy based upon prior experience with RER. These services include advising on permitting and licensing activities, demonstration plant project involvement, Bear Lodge project progression activities (if applicable), and other consulting as desired. |
5. | Standard of Services. The Consultant shall perform the Services with that degree of care, skill and judgment, which is customarily exercised by professionals in the performance of services of a similar nature in the same geographical area. |
Consultant agrees to abide by all Health and Safety policies and procedures as set forth in the Bear Lodge Health and Safety Plan and any amendments or updates thereto as to any site visits or other engagement at the Bear Lodge project area. RER agrees to timely provide Consultant all updates to the plan. Consultant further agrees to comply with all applicable Occupational Safety and Health Administration (OSHA) laws and/or Mine Safety and Health Administration (MSHA) laws.
6. | Permits and Licenses. In performing the Services, the Consultant shall comply with any and all applicable federal, state, and local laws, rules, regulations, and interpretations of all regulating agencies, including, but not limited to, statutes, ordinances, regulations, rules, building codes, permits, requirements, decree orders, and directives from any lawful public agency or authority. |
7. | Insurance. The Consultant hereby confirms that he is an independent Consultant, not an employee of RER, for any purpose including worker’s compensation statutes. Further, the Consultant hereby waives and agrees to indemnify and hold harmless RER and its officers, directors, affiliates, agents and employees from any and all worker’s compensation claims, damages, losses, and expenses arising out of, or resulting from bodily injury, including personal injury, sickness, disease, or death of any and all employees of Consultant who would otherwise be covered by Consultant’s worker’s compensation insurance. This waiver and agreement to indemnify does not relieve RER from any liability for injury to Consultant to the extent caused by the negligent acts of RER, its agents, employees, or representatives. |
8. | Indemnification. The Consultant shall indemnify and hold harmless RER and its officers, directors, affiliates, employees and agents from and against all claims, damages, losses and expenses, including but not limited to reasonable attorney fees, arising out of or resulting from the negligence, knowingly wrongful acts, errors or omissions of the Consultant. |
9. | Disclosure of Information and Non-Competition. |
Consultant has previously executed a Non-Disclosure Agreement (“NDA”) with Synchron, General Atomics, UIT, and the Company and all terms of the NDA apply to Consultants engagement hereunder, including any further extension to the NDA. Further Consultant agrees as follows:
(a) | All materials, data, specifications, plans, inventions, documents or other information prepared, developed or delivered to RER, or obtained by Consultant or his employees, if any, pursuant to and as a result of this Agreement, or any prior agreement between the parties, shall remain or become the property of RER. |
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Consultant shall ensure the confidentiality of all such information deemed non-public, proprietary, or confidential by the RER (“Confidential Information”). Consultant shall not disclose to any third party any type of Confidential Information described in this section or any other information of any description whatsoever (expressly including any technical process, geological findings or data and property claims and land boundaries) regarding plans, programs, plants, processes, products, costs, equipment, operations, or customers of RER or its clients that may come within the knowledge of Consultant in the performance of this Agreement, or is known to Consultant upon entering into this Agreement if obtained through prior consulting or employment, except:
(i) | Confidential Information which is or becomes part of the public domain other than by acts or omissions of Consultant; or |
(ii) | Confidential Information which was lawfully in the possession of the Consultant at the time he initially became involved with the Services and was not acquired by Consultant directly from RER or any of its employees, affiliates, or contractors or anyone acting directly or indirectly for, or on behalf of, RER; or |
(iii) | Confidential Information which Consultant is legally compelled by applicable law, by any court, governmental agency, or regulatory authority, or by subpoena or discovery request in pending litigation, but only if, to the extent lawful, Consultant gives RER prompt written notice of the fact prior to the disclosure so that RER may request a protective order or other remedy to prevent or limit such disclosures, and in the absence of such protective order or other remedy, Consultant may disclose only such portion of the Confidential Information which he is legally obligated to disclose. |
The Consultant will not, without the prior written consent of RER, disclose to any third-party information developed or obtained by the Consultant in the performance of the Agreement except to the extent that such information falls within one of the categories described in (i), (ii) or (iii) above.
In addition, the Consultant acknowledges that from time-to-time additional confidentiality agreements may be imposed due to requirements of customers, consultants or partners of RER. Consultant agrees to sign and abide by any such confidentiality agreements as reasonably requested by the Company.
(b) | In the event of a breach or threatened breach by the Consultant of Section 9(a) above, RER shall be entitled, without the need to provide any form of security, to an injunction restraining Consultant from disclosing, in whole or in part, any such confidential or technical information, or from rendering any services to any person or entity to whom such confidential or technical information has been disclosed or is threatened to be disclosed. Nothing herein shall be construed as prohibiting RER from pursuing any other remedies available to it for such breach or threatened breach, including the recovery of damages from the Consultant. Consultant specifically acknowledges and agrees that if he breaches this section, RER shall be entitled to recover all costs and expenses incurred by it, including reasonable costs, expenses, and liabilities, as a result of such breach or in pursuing any available remedy at law or in equity. |
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(c) Consultant will not, either alone or in partnership or jointly or in conjunction with any person, or in any other manner whatsoever, directly or indirectly acquire any interest in any mining or millsite claims or otherwise acquire any interest in minerals, real property, royalties or water within twenty (20) miles from the outside boundaries of any of the properties of Company.
Consultant acknowledges that due to the nature of RER’s business and interest in the properties, the restrictions set out in section of this provision are necessary and reasonable. Any interest acquired in violation of this paragraph shall, at RER’s request and at no cost to RER, be conveyed to RER.
10. | Independent Consultant. Consultant represents that he is fully experienced, properly qualified, equipped, organized, and financed to perform the Services. In the performance of the Services, the Consultant is and shall remain an independent Consultant. The Consultant shall not be deemed the servant, employee, or agent of RER, and therefore, Consultant shall not be entitled to worker's compensation benefits or unemployment insurance benefits. Except as otherwise expressly provided herein or by subsequent written notice to Consultant, the Consultant shall have the exclusive authority and responsibility for performing the Services and accomplishing the objectives of the Services, RER being interested only in the results obtained. RER shall not make any deductions, withholdings or contributions with respect to any payments to Consultant under this Agreement on account of social security, unemployment compensation, income tax, or otherwise under any federal, state, local or foreign law applicable to employer/employee relationships. All compensation earned and payable to Consultant under the terms of this Agreement shall be earned by her solely as, and in the capacity of, an independent Consultant |
11. | Conflicts of Interest and Priority. Consultant has disclosed that his engagement is not exclusive to RER, however, Consultant shall perform the Services timely and to the satisfaction of RER, taking all precautions to secure confidential treatment of RER information in full adherence to Section 9. Notwithstanding the above, Consultant shall disclose in writing to RER any actual or potential conflicts of interest relating to his engagement under this Agreement of which Consultant is aware, which includes engagement by or employment with a rare earth company or individual with either a perceived or actual competitive position with RER, provided that Consultant shall not breach any obligation of confidentiality to any third party in his disclosure regarding the engagement. In the case RER deems the engagement a conflict of interest, RER has the option to terminate the Agreement in accordance with Paragraph 12(b). In no instance shall RER’s waiver or termination due to a potential conflict of interest relieve Consultant of his confidentiality obligations to RER or its affiliates. |
12.Term and Termination.
| (a) | This Agreement shall become effective on the Effective Date set forth above and terminate as of December 31, 2024, however, the parties may extend such term for success one-year calendar terms upon mutual agreement (the “Term”). |
| (b) | Notwithstanding the above, this Agreement may be terminated by either party, on sixty days’ written notice. Consultant agrees that upon termination he will professionally wrap up all services underway and coordinate transition items, if any, required by the Company or other third parties. |
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| (c) | Upon conclusion of the Services, the Consultant shall promptly discontinue all Services and shall deliver to RER all information and materials obtained in the performance of this Agreement. RER shall pay Consultant for Services performed to the effective date of termination. |
| (d) | Sections 7, 8, 9, 10, 14, 15 and 16 in this Agreement shall survive termination of this Agreement. |
13. | No Assignment. The Consultant shall not assign this Agreement nor any sum payable under this Agreement. |
14. | Arbitration. Except for any injunctive remedy for alleged breach pursuant to Section 9(b), all other claims, disputes and other matters arising out of, or relating to, this Agreement or an alleged breach of this Agreement which cannot be settled between the parties directly shall be subject to final and binding arbitration in Denver, Colorado pursuant to the attached arbitration rules as Exhibit B. |
15. | Notices. All notices, consents and communications required or permitted under this Agreement shall be in writing and shall be deemed effective when delivered personally, by certified mail, by a courier or delivery service, or by fax or electronic transmission to the parties at the following address or at such other address for a party as shall be specified by like notice given at least five days prior thereto: |
If to RER:Brent Berg Rare Element Resources, Inc.
PO Box 271049
Littleton, CO 80127
***@***
If to Consultant: Jaye T. Pickarts, P.E.
9792 West Unser Ave.
Littleton, Colorado 80128
***@***
16. Miscellaneous
(a) | Colorado Law. Notwithstanding the arbitration venue set forth in Section 14 above, this Agreement shall be governed in all respects, including validity, interpretation and effect by the laws of the State of Colorado. |
(b) | Entire Agreement and Modifications. The parties acknowledge that this Agreement constitutes the entire agreement between the parties and supercedes all prior representations, warranties, agreements and understandings, oral or written, between the parties with respect to its subject matter, including Consultant’s prior employment agreement with RER, which has been mutually terminated. No modification or amendment of this Agreement or the waiver of any terms, conditions, rights or remedies hereunder shall be binding upon any party hereto unless signed in writing by both parties. A waiver of any term or provision shall not be construed as a waiver of any other term or provision. |
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(c) | Benefit. This Agreement shall be binding upon and inure to the benefit of the parties, and their respective successors and permitted assigns. |
(d) | Headings and Severability. If any clause or provision of this Agreement shall be adjudged invalid or unenforceable, it shall not affect the validity of any other clause or provision, which shall remain in full force and effect. In the event any provision of this Agreement is found to be unenforceable for any reason, the parties shall attempt to modify that portion in a manner to preserve the intent of the parties in entering into this Agreement. The headings in the Agreement are for convenience and reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. |
In Witness Whereof, the parties have executed this Agreement as of the day and year first above written.
Consultant: Jaye PickartsRER:
Tax I.D. # On FileRare Element Resources, Inc.
/s/ Jaye Pickarts /s/ Brent Berg
Jaye T. Pickarts, P.E. Brent Berg, President & CEO
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Rare Element Resources Inc.
Exhibit A
Description of Services
Consultant’s Responsibilities shall include:
Provide Professional and Technical services as directed by RER in support of the Company’s rare earth demonstration plant project and Bear Lodge project, and associated tasks.
Services Fee:
Consultant shall be compensated at the rate of $230 per billable hour. Consultant shall not exceed the contract value of $240,000 over a 12-month period unless pre-approved by Brent Berg, Consultant’s contact at the Company.
Consultant shall keep detailed timesheets, submitted with a monthly invoice. Consultant shall comply with all timekeeping and other expense reimbursement requirements as part of the demonstration project subcontract.
Consultant shall be eligible for stock option grants pursuant to the Company’s Stock Option Plan and as approved by the Board of Directors of the Company. Any grant is at the sole option of the Board of Directors.
Reimbursable Expenses:
All approved expenses shall be actual, with no mark-up to RER. Expenses shall only be reimbursed if set forth with specificity on the RER expense reimbursement form.
Rare Element Resources Inc.
Exhibit B
Arbitration Provision
Arbitration. Except for any injunctive remedy for alleged breach pursuant to Section 9(b) of the Professional Services Agreement, all other claims, disputes, controversies, grievances, suits, or causes of action (individually, a “Dispute,” and collectively, “Disputes”) between RER and Consultant (including any claim or cause of action against any of RER’s or Consultant’s “Representatives” [defined below]), whether sounding in contract, tort, statute or otherwise, arising out of, related to or in any way connected with this Agreement, the Services or any resulting transaction which are not settled through mediation shall be decided by neutral, binding arbitration and not by court action. RER and Consultant further agree that (i) any Dispute involving any or RER’s or Consultant’s officers, directors, shareholders, managers, members, partners, subcontractors, suppliers, architects, engineers, attorneys, consultants, representatives, employees and/or agents (each a “Representative,” and collectively, “Representatives”), will be resolved by arbitration as set forth herein and not in a court of law; and (ii) either party will have the option to include any Representatives as parties in the arbitration. RER and Consultant agree that each party’s Representatives are intended third-party beneficiaries of this agreement to arbitrate all Disputes and any Representative shall have the right to enforce this arbitration agreement.
RER expressly waives any and all rights to any other means of pursuing a cause of action against Consultant or any Representative, including without limitation a court action, and RER agrees that binding arbitration pursuant to this Section is RER’s sole and absolute remedy to solve any Dispute with Consultant or any Representative. Consultant expressly waives any and all rights to any other means of pursuing a cause of action against RER or any Representative, including without limitation a court action, and Consultant agrees that binding arbitration pursuant to this Section is Consultant’s sole and absolute remedy to solve any Dispute with RER or any Representative. The waiver or invalidity of any portion of this Section will not affect the validity or enforceability of the remaining portions of this Section.
Except as otherwise stated herein, the arbitration shall be conducted in accordance with the Colorado Uniform Arbitration Act, and the arbitration proceeding shall be subject to each of the following:
(a) The arbitration shall be conducted by a single arbitrator who shall be a retired Colorado state court or Federal judge or attorney licensed to practice law in Colorado.
(b) The arbitration shall not be open to the public. The decision shall not be published. The arbitrator’s decision shall be confidential and shall not establish a precedent.
(c) The Colorado Rules of Civil Procedure shall govern disclosure, discovery and all other pre-hearing proceedings in the arbitration. The Colorado Rules of Evidence shall govern the admissibility of evidence at the hearing. The arbitrator shall apply Colorado law to all claims and defenses asserted or raised by any party.
(d) The arbitrator shall have no authority to award punitive damages or attorneys’ fees to any party. If the Dispute involves claims governed by the Construction Defect Action Reform Act, C.R.S. §§ 13-20-801 et seq., or any successor statute (“CDARA”), the arbitrator shall award only damages of the nature and amount allowed under CDARA.
Rare Element Resources Inc.
(e) The arbitrator shall issue an award within 30 days of the completion of the arbitration hearing or, if post-hearing briefs are submitted, within 30 days of receipt of the briefs. If the parties file post-hearing briefs, they shall submit such briefs within 20 days of the completion of the hearing. No extensions of time will be permitted.
(f) If the arbitrator requires any advance fees to be paid, the parties will divide those equally. If the arbitration award requires any party to pay more than one-half of the fees, the parties shall adjust credit for payment of the advance fee to accurately reflect payment required under the award.
(g) Judgment upon the award rendered by the arbitrator may be entered in any court of competent jurisdiction.
(h) Any Dispute that involves the interpretation or enforceability of this arbitration agreement, including without limitation, its revocability or voidability for any cause, the scope of arbitrable issues, and any defense based on waiver, estoppel or laches, shall be decided by the arbitrator.
RER and Consultant expressly agree that this arbitration agreement shall be self-executing and shall survive the expiration or earlier termination of this Agreement.
NOTICE: YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS INCLUDED IN THE “ARBITRATION” PROVISION DECIDED BY NEUTRAL ARBITRATION IS PROVIDED BY COLORADO LAW AND YOU ARE GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL. IF THE PARTIES ARE UNABLE TO MUTUALLY AGREE ON A NEUTRAL ARBITRATOR, THE PARTIES SHALL APPLY TO THE DISTRICT COURT FOR JEFFERSON COUNTY, COLORADO TO APPOINT A SINGLE ARBITRATOR WHO SHALL BE EITHER A RETIRED JUDGE OR AN ATTORNEY LICENSED TO PRACTICE LAW IN THE STATE OF COLORADO. BY INITIALING IN THE SPACE BELOW YOU ARE GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY, TRIAL AND APPEAL.
