Company: REE
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001628280-25-025661
Chunk: 124

Company: REE Automotive Ltd.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 10
Chunk 124
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 an eight-year period, commencing on the year in which such rights were first exercised;

• under limited conditions, an election to file consolidated tax returns with controlled Israeli Industrial Companies;

• expenses related to a public offering are deductible in equal amounts over three years commencing on the year of the offering.

We believe that we currently qualify as an Industrial Company within the meaning of the Industry Encouragement Law. Eligibility for benefits under the Industry Encouragement Law is not contingent upon approval of any governmental authority. There can be no assurance that we will continue to qualify as an Industrial Company or that the benefits described above will be available in the future.

Table of C ontents

Tax benefits and grants for research and development

Israeli tax law allows, under certain conditions, a tax deduction for expenditures related to scientific research and development projects, including capital expenditures, for the year in which they are incurred. Expenditures are deemed related to scientific research and development projects, if:

• the expenditures are approved by the relevant Israeli government ministry, determined by the field of research;

• the research and development must be for the promotion of the company; and

• the research and development is carried out by or on behalf of the company seeking such tax deduction.

The amount of such deductible expenses is reduced by the sum of any funds received through government grants for the finance of such scientific research and development projects. Under these research and development deduction rules, no deduction is allowed if such deduction is related to an expense invested in an asset depreciable under the general depreciation rules of the Ordinance. Expenditures that are unqualified under the conditions above do not qualify for this special deduction are deductible in equal amounts over three years.

From time to time we may apply to the IIA for approval to allow a tax deduction for all or most of research and development expenses during the year incurred. There can be no assurance that such application will be accepted. If we are not be able to deduct research and development expenses during the year of the payment, we may be able to deduct research and development expenses in equal amounts over a period of three years commencing in the year of the payment of such expenses.

Law for the Encouragement of Capital Investments, 5719-1959

The Law for the Encouragement of Capital Investments, 5719-1959, generally referred to as the Investment Law, provides certain incentives for capital investments in production facilities (or other eligible assets). Generally, an investment program that is implemented in accordance with the provisions of the Investment Law