The Tel Aviv District Court approved a debt arrangement yesterday (Wednesday) for autotech company REE Automotive, which had accumulated debts totaling NIS 51 million. The company will continue to operate under an arrangement based, in part, on new investment from Kukac LLC and Elljay Limited - each contributing $2 million - to provide the company with working capital.
REE Automotive, a developer of SDV (software defined vehicle) technology, went public five years ago through a merger with a SPAC at a valuation of $3.1 billion. The company’s shares were recently delisted from Nasdaq and moved to over-the-counter (OTC) trading in the US, following a failure to meet the requirements for continued listing.
According to the filing submitted to the court, following further rounds of layoffs, the company currently employs 31 people in Israel, down from 270 at the time it became listed on Nasdaq. In 2025, the company recorded revenue of only $1.3 million, while its losses reached $55.8 million. Since its founding in 2011, the company has burned through more than $1 billion.
Judge Hagai Brenner said that the arrangement was intended "to preserve the company as a going concern and prevent the liquidation of assets, which would result in the destruction of value, employee layoffs, and a negligible recovery for the creditors."
Under the arrangement, the investors will convert debt totaling NIS 20 million into shares in the company. REE Automotive’s CEO Daniel Barel and VP Ahishai Sardas will convert debts amounting to millions of shekels arising from loans they extended to the company into shares, which will increase the distribution rate for creditors.
Another source for repaying creditors will be the transfer of cash to the settlement from the company’s available cash and projected receipts. Among other things, this involves proceeds from a defense project in which the company is involved, totaling up to $3 million.
The tax authorities and employees are expected to be paid in full. Suppliers are expected to recover approximately 21% of their claims; they have also been granted a right to conditional payment of up to $3 million in the event of an exit by the company.
The settlement plan is supported by an opinion from CPA Jacob Passi, who noted that the settlement alternative was vastly preferable to liquidation.
The settlement administrator is Adv. Ori Gaon, represented by Adv. Shay Lavon-Gilad of the S. Horowitz & Co. law firm. The company is represented by Advs. Yaniv Dinovitz and Neri Lavi of the Herzog Fox & Neeman law firm.
Published by Globes, Israel business news - en.globes.co.il - on October 29, 2026.
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