Company: REE
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001628280-25-025661
Chunk: 9

Company: REE Automotive Ltd.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 3
Chunk 9
---
 to order sufficient quantities of product components in a timely manner, the delivery of products to its potential customer base could be delayed, which would harm REE’s business, financial condition and operating results.

REE will need to improve its operational and financial systems to support its expected growth, increasingly complex business arrangements and rules governing revenue and expense recognition and any inability to do so will adversely affect REE’s billing and reporting.

To manage the expected growth of its operations and increasing complexity, REE will need to improve its operational and financial systems, procedures, and controls and continue to increase systems automation to reduce reliance on manual operations. Any inability to do so may affect REE’s billing and reporting. REE’s current and planned systems, procedures and controls may not be adequate to support its complex arrangements and the rules governing revenue and expense recognition for its future operations and expected growth. Delays or problems associated with any improvement or expansion of REE’s operational and financial systems and controls could adversely affect REE’s relationships with its potential customer base, cause harm to its reputation and brand and could also result in errors in its financial and other reporting.

REE’s insurance strategy may not be adequate to protect it from all business risks and losses.

In the ordinary course of business, REE may become subject to claims resulting from employment disputes, property, casualty, products liability, accidents, acts of God, cyber liability, and other claims similar to other companies with our risk profile that are normal and customary in the market and in our industry. In connection therewith, REE uses commercially reasonable efforts to protect itself and its activities against such losses and risks and in such amounts as are prudent and customary in the businesses in which it and its subsidiaries are engaged. In connection therewith, REE has obtained insurance policies covering commercial general liability, workers’ compensation and directors’ and officers’ insurance policies. Such insurance policies are subject to various deductibles, policy limits, and exclusions that may impact our ability to have coverage for a specific risk. Additionally, if and when REE resumes the delivery of its vehicles to the public, it would plan to maintain an appropriate level of insurance coverage that is proportionate to the number of vehicles sold. Despite such efforts, REE may not successfully strike the appropriate balance of sufficient insurance coverage to address the specific risk and/or loss, and in some cases, REE may not be insured against certain types of claims. Additionally, the policies that REE does have may include significant deductibles, and REE cannot be certain that its insurance coverage will be