Court docket approves debt settlement for REE Automotive

The Tel Aviv District Court docket authorized a debt association yesterday (Wednesday) for autotech firm REE Automotive, which had collected money owed totaling NIS 51 million. The corporate will proceed to function below an association based mostly, partially, on new funding from Kukac LLC and Elljay Restricted – every contributing $2 million – to offer the corporate with working capital.

REE Automotive, a developer of SDV (software program outlined car) expertise, went public 5 years in the past by means of a merger with a SPAC at a valuation of $3.1 billion. The corporate’s shares had been just lately delisted from Nasdaq and moved to over-the-counter (OTC) buying and selling within the US, following a failure to fulfill the necessities for continued itemizing.

In keeping with the submitting submitted to the court docket, following additional rounds of layoffs, the corporate at present employs 31 folks in Israel, down from 270 on the time it turned listed on Nasdaq. In 2025, the corporate recorded income of solely $1.3 million, whereas its losses reached $55.8 million. Since its founding in 2011, the corporate has burned by means of greater than $1 billion.

Decide Hagai Brenner mentioned that the association was supposed “to protect the corporate as a going concern and forestall the liquidation of property, which might end result within the destruction of worth, worker layoffs, and a negligible restoration for the collectors.”

Beneath the association, the buyers will convert debt totaling NIS 20 million into shares within the firm. REE Automotive’s CEO Daniel Barel and VP Ahishai Sardas will convert money owed amounting to thousands and thousands of shekels arising from loans they prolonged to the corporate into shares, which can enhance the distribution price for collectors.

One other supply for repaying collectors would be the switch of money to the settlement from the corporate’s out there money and projected receipts. Amongst different issues, this entails proceeds from a protection challenge during which the corporate is concerned, totaling as much as $3 million.

The tax authorities and workers are anticipated to be paid in full. Suppliers are anticipated to get well roughly 21% of their claims; they’ve additionally been granted a proper to conditional cost of as much as $3 million within the occasion of an exit by the corporate.

The settlement plan is supported by an opinion from CPA Jacob Passi, who famous that the settlement various was vastly preferable to liquidation.

The settlement administrator is Adv. Ori Gaon, represented by Adv. Shay Lavon-Gilad of the S. Horowitz & Co. legislation agency. The corporate is represented by Advs. Yaniv Dinovitz and Neri Lavi of the Herzog Fox & Neeman legislation agency.

Revealed by Globes, Israel enterprise information – en.globes.co.il – on October 29, 2026.