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ITEM
7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
You should read the following discussion and analysis of our financial condition and results of operations together
with our financial statements and related notes appearing elsewhere in this Annual Report. This discussion and
analysis contains forward-looking statements that involve risks, uncertainties and assumptions. See “Cautionary
Note Regarding Forward-Looking Statements.” Our actual results may differ materially from those anticipated in
these forward-looking statements as a result of many factors, including, but not limited to, those set forth under
“Risks and Uncertainties” and elsewhere in this Annual Report.
The following discussion and analysis of our financial condition and results of operations should be read in
conjunction with our Consolidated Financial Statements and accompanying notes included in Item 8 of this Annual
Report. Management’s Discussion and Analysis (this “MD&A”) has been prepared based on information known to
management as of March 29, 2016. This MD&A is intended to help the reader understand the consolidated audited
financial statements of Rare Element.
INTRODUCTION
We are focused on advancing to production the Bear Lodge REE Project in Wyoming.
All currency amounts are expressed in thousands of U.S. dollars, except per share and common share amounts,
unless otherwise noted.
OUTLOOK
We have limited cash resources on hand and have announced measures to reduce staffing and conserve
remaining cash. The Company has narrowed the focus of its activities to advance the Project concentrating on only
the very highest priority items that we believe have the greatest potential to preserve the value of the Project and
shareholder value, including seeking capital and actively pursuing potential strategic alternatives, including off-take
agreements and joint ventures, and the potential sale of the Project. If we obtain sufficient financing, we plan to
resume permitting activities, resume pilot plant testing and design/engineer a small-scale initial production facility,
the results of which would be incorporated into the planned Feasibility Study.
RISKS AND UNCERTAINTIES
Our activities are subject to certain risks and uncertainties that might impact our financial results. For a
more detailed list of such risks and uncertainties, please see “Item 1A. Risk Factors” of this Annual Report.
Our failure to successfully address these risks and uncertainties could have a material adverse effect on our
business, financial condition and/or results of operations. Consequently, the trading price of our common shares
may decline, and investors may lose part of or all their investment in the Company. We cannot assure you that we
will successfully address these risks and uncertainties or other unknown risks and uncertainties that may affect our
business.
RESULTS OF OPERATIONS
Year Ended December 31, 2015 Compared to Year Ended December 31, 2014
Summary
Our consolidated net loss for the year ended December 31, 2015 was $9,678, or $0.19 per share, compared
with our consolidated net loss of $14,029, or $0.29 per share, for the same period in 2014. For the year ended
December 31, 2015, the decrease in consolidated net loss was primarily the result of a decrease in exploration and
evaluation expense of $3,488 and a decrease in corporate administration costs of $904 (of which $263 related to
stock-based compensation).