Company: REE
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001628280-25-025661
Chunk: 45

Company: REE Automotive Ltd.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 3
Chunk 45
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 defects, and/or security vulnerabilities could result in serious injury to, or death of, the end users of vehicles incorporating our products, or those in the surrounding area, including as a result of traffic accidents and collisions. If that is the case, we could by subject to litigation and would incur significant additional development costs and product recall, repair, or replacement costs. If any of our products are or are alleged to be defective, we may be required to participate in a recall involving such product(s). The automobile industry experiences significant product liability claims and REE faces inherent risk of exposure to claims in the event its products and/or technology do not perform as expected or malfunction in a manner that causes personal injury or death Similarly, as a technology provider related to, among other things, preventing traffic collisions and other accidents through our SDV technology and proprietary software, we could be subject to litigation for traffic collisions or other accidents, even if our products or their features or the failure thereof did not cause any particular traffic collision or accident. This may also be the case where an accident occurs involving one of our SDV products, which are built autonomous ready, where autonomous features installed by another company were engaged, particularly because such autonomous features are the subject of significant public attention, especially in light of NHTSA’s Standing General Order (as amended on April 24, 2025) requiring reports regarding certain crashes involving vehicles with advanced driver assistance systems, which includes motor vehicle and equipment manufacturers of which REE may be included under. REE’s risks in this area are particularly pronounced given it has limited field experience with its products. While we may use disclaimers, limitations of liability, and similar provisions in our agreements, there is no assurance that any or all of these provisions will prove to be effective barriers to product liability claims with respect to our products. Moreover, a product liability claim could generate substantial negative publicity about REE’s products and business and inhibit or prevent commercialization of other future product, which would have a material adverse effect on REE’s brand, business, prospects and operating results. To the extent that REE has insurance coverage, it might not be sufficient to cover all potential product liability claims. Product liability, warranty, and recall costs, whether in excess of REE’s coverage, or outside of REE’s coverage, would have an adverse effect on our business, results of operations, and financial condition. In addition, product liability claims present the risk of protracted litigation, legal fees, and diversion of management’s attention from the operation of our business