FUNDING AGREEMENT BETWEEN WYOMING ENERGY AUTHORITY AND RARE ELEMENT RESOURCES, INC.

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Exhibit 10.1

FUNDING AGREEMENT BETWEEN

WYOMING ENERGY AUTHORITY AND

RARE ELEMENT RESOURCES, INC.

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The WEA:

▇▇▇ ▇▇▇▇▇▇▇, Executive Director

▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ #▇

Cheyenne, WY 82001

▇▇▇.▇▇▇▇▇▇▇@▇▇▇.▇▇▇

▇▇▇-▇▇▇-▇▇▇▇

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Recipient:

Rare Element Resources, Inc.

▇▇▇▇▇ ▇▇▇▇, President and Chief Executive Officer

PO Box 271049

Littleton, CO  80127

▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇

▇▇▇-▇▇▇-▇▇▇▇

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Before releasing publicity that includes any specific references to a Wyoming state official or state agency, the Recipient shall contact the Governor’s Communication Director, via telephone at (▇▇▇) ▇▇▇-▇▇▇▇, to obtain prior approval (with email approval being sufficient).

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The Parties acknowledge that the Acts may require the WEA to conduct certain business in public and make certain records available for public inspection, on request. The WEA shall provide the Recipient with all public notices required under the Public Meetings Act. If the Recipient is concerned about any information that could be revealed or discussed during the noticed public meeting, the Recipient and the WEA shall work together prior to the public meeting to address those concerns, with the final decision on any disclosure being made in the sole discretion of the WEA.

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If the WEA receives a public records request, the WEA shall forward a copy of the request to the Recipient. Recipient shall communicate any objection or concerns regarding the request to the WEA within ten (10) business days of receipt of the request. Recipient and the WEA shall work together to respond to any public records request and shall fully cooperate and assist one another in responding to any such request, with the final decision on any disclosure being made in the sole discretion of the WEA.

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The WEA shall work in good faith to protect from disclosure any materials properly exempted under the Acts, and the Recipient shall hold the WEA harmless for any disclosures the WEA is required to make under either Act or any accidental disclosures made in the course of seeking to comply with the Act.

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Notwithstanding anything to the contrary, the term “Confidential Information” shall not include, and nothing in the Agreement will limit the Receiving Party’s use or disclosure of, information that is: (i) now generally known or available on an unrestricted basis to the public or becomes so known or available on an unrestricted basis through no fault of the  Receiving Party; (ii) already in the Receiving Party’s possession without restriction as to its use or disclosure before receiving it from the Disclosing Party; (iii) developed by or for the Receiving Party independently of and without reference to the other Party’s Confidential Information; or (iv) is required to be disclosed by any law, rule, regulation or any order, decree, subpoena or ruling or other similar process of any court of competent jurisdiction, governmental agency or governmental or regulatory authority; provided, however, that prior to making such disclosure, the Receiving Party will, if allowed by applicable law, provide the Disclosing Party with prompt written notice of any requirement so that the Disclosing Party may seek a protective order or other appropriate protection or remedy at the Disclosing Party’s expense.

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The Receiving Party may disclose Confidential Information without the Disclosing Party’s prior written consent to the following persons (“Representatives”) to the extent that they have a clear need to know in order to evaluate or consummate the Project: (i) employees, officers, partners and directors of the Receiving Party; (ii) employees, officers, partners and directors of a Receiving Party’s affiliate; and (iii) any legal counsel, accountant, consultant, advisor or agent retained by the Receiving Party or its affiliate.  The Receiving Party shall inform its Representatives of the confidential and proprietary nature of the Confidential Information and shall instruct its Representatives to comply with the provisions hereof.  The Receiving Party shall be responsible for any breach of this Paragraph.

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Should the WEA and Recipient contemplate the joint development of inventions or intellectual property related to the Project, the terms and conditions of such involvement and activities will be governed by a separate written agreement(s) that establishes the rights and obligations of the respective parties.

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This Section is not intended to, and shall not, diminish the license granted by Recipient to the WEA in Section 6(g).

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Notwithstanding anything to the contrary contained herein, the license granted by Recipient to the WEA in Section 6(g) shall survive any termination of this Agreement, other than Recipient’s termination of this Agreement as a result of the WEA’s breach of any of its obligations under this Agreement. In the event of any termination, the WEA may – subject to the confidentiality obligations - retain any information and data that it received from

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Recipient pursuant to this Agreement (including, without limitation, Technical Data and Confidential Information) and will be entitled to receive (i) any Technical Data identified as a deliverable that began to be developed and would become due before such termination and (ii) any Technical Data identified as a deliverable that began to be developed and was previously identified as becoming due within thirty (30) days after the effective date of such termination.

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THE REMAINDER OF THIS PAGE WAS INTENTIONALLY LEFT BLANK.

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The Effective Date of this Agreement is the date of the signature last affixed to this page.

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WEA:

Wyoming Energy Authority

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/s/ ▇▇▇ ▇▇▇▇▇▇▇​ ​6/6/23​ ​

▇▇▇ ▇▇▇▇▇▇▇, Executive DirectorDate

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RECIPIENT:

Rare Element Resources, Inc.

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/s/ ▇▇▇▇▇ ▇▇▇▇​ ​5/25/23​ ​

▇▇▇▇▇ ▇▇▇▇, President and CEODate

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ATTORNEY GENERAL'S OFFICE: APPROVAL AS TO FORM

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/s/ ▇▇▇▇▇ ▇. Runner​ ​5/24/23​ ​

▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Supervising Attorney GeneralDate

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Exhibit A

The Project

Rare Earth Elements (REE) are the seeds of technology, yet America relies heavily on Chinese sources of critical minerals, including rare earth material needed for high-strength permanent magnets, electronics, fiber optics, laser systems for medical technology and defense, electric vehicles, solar panels and wind turbines. Rare Element Resources’ (RER) Bear Lodge Project in Crook County, Wyoming is poised to address this need. RER and its strategic partner, General Atomics (GA), is designing, constructing and operating a rare earth demonstration-scale processing and separation plant in Upton, Wyoming. By processing rare earth material already stockpiled from the Wyoming Bear Lodge Project deposit, the plant is intended to prove the operational flow sheet and scalability for final plant design for a commercial rare earth separation and processing facility as it catapults Wyoming's place as a critical mineral production hub, providing employment and training opportunities in this emerging industry.

The objectives of this demonstration project are to create a Wyoming facility that:

The project is funded 50% through a DOE cost share with RER using its own funds for the matching cost-share.

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Exhibit B

Statement of Work

The Project is executed in phases. First is the engineering and design, commencement of permitting, and early procurement which was completed in December 2022. Second is the completion of permitting and further procurement phase. Third is the final procurement and construction phase, and the last phase is the operations and decommissioning phase utilizing previously stockpiled material form the Bear Lodge Project. See Exhibit C for the Project timeline.

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Exhibit C

Project Milestone, Recipient’s Responsibilities and Reporting Requirements

The Rare Earth Demonstration Plant Project is subject to two Project Milestones and WEA funding dates that are in tandem with the U.S. Department of Energy (“DOE”) Go/No-Go decision approvals.  The following schedule provides expectations regarding key schedule milestones.

Recipient shall provide to WEA a project update including accomplishments to-date together with the DOE documented approval to proceed at each of the two decision points above (as potentially adjusted and approved by the DOE). Any DOE approved adjustments to the two scheduled milestones will be provided to WEA.  It is understood any adjustments will require WEA’s consideration of project status and may require additional documentation.

Each milestone period (BP1 and BP2) will allocate one-half of the total grant funding of $4,400,000.00 (up to $2,200,000.00 per period) for each of the two performance periods, which must be actual project costs expended by Recipient, and not subject to federal funding reimbursement, during that period.  Recipient shall provide WEA a detailed summary of eligible reimbursable project costs for each of the two periods (BP1 and BP2) along with the DOE approval to proceed at each DOE Go/No Go decision point.

The retainer held by WEA of 10% of the total funding in accordance with the Funding Agreement shall be invoiced by Recipient sixty (60) days following operation commencement, estimated to be in July 2024, and submission of the Final Executive Summary Report in a form approved by WEA.

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Exhibit D

Special Provisions

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Insurance Requirements.

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Insurance Coverage. The Recipient shall obtain and maintain the following insurance in accordance with the Insurance Requirements set forth above:

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(a)$1,000,000.00 each occurrence;

(b)$1,000,000.00 personal injury and advertising injury;

(c)$2,000,000.00 general aggregate; and

(d)$2,000,000.00 products and completed operations.

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The CGL policy shall include coverage for Explosion, Collapse and Underground property damage. This coverage may not be excluded by endorsement.

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The Recipient shall provide the WEA with a Certificate of Good Standing or other proof of workers’ compensation coverage for all of its employees who are to perform work under this Agreement, if such coverage is required by law. If workers’ compensation coverage is obtained by Recipient through the Wyoming Department of Workforce Services’ workers’ compensation program, Recipient shall also obtain Employer’s Liability “Stop Gap” coverage through an endorsement to the CGL policy required by this Agreement, with minimum limits as follows:

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(a)Bodily Injury by Accident: $1,000,000.00 each accident;

(b)Bodily Injury by Disease: $1,000,000.00 each employee; and

(c)Bodily Injury by Disease: $1,000,000.00 policy limit.

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