The information in this proxy statement/prospectus is not complete and may be changed. We may not issue these securities until the registration statement filed with the Securities and Exchange Commission is effective. This proxy statement/prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

The registration statement of which this proxy statement/prospectus is a part covers the REE Class A Ordinary Shares and REE Warrants issuable to the securityholders of 10X Capital as described above. Accordingly, we are registering up to an aggregate of 28,056,250 REE Class A Ordinary Shares, 15,562,500 REE warrants, and 15,562,500 REE Class A Ordinary Shares issuable upon the exercise of the warrants. We are not registering the REE Class A Ordinary Shares and REE Warrants issued or issuable to the existing REE securityholders or the PIPE Investors.

Proposals to approve the Merger Agreement and the other matters discussed in this proxy statement/prospectus will be presented at the Special Meeting of 10X Capital securityholders scheduled to be held on             , 2021 in virtual format.

Although REE is not currently a public reporting company, following the effectiveness of the registration statement of which this proxy statement/prospectus is a part and the closing of the Merger, REE will become subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). REE intends to apply for listing of the REE Class A Ordinary Shares and REE Warrants on Nasdaq under the proposed symbols “REE” and “REEAW,” respectively, to be effective at the consummation of the Merger. It is a condition of the consummation of the Merger that the REE Class A Ordinary Shares are approved for listing on Nasdaq (subject only to official notice of issuance thereof and round lot holder requirements). While trading on Nasdaq is expected to begin on the first business day following the date of completion of the Merger, there can be no assurance that REE’s securities will be listed on Nasdaq or that a viable and active trading market will develop. See “Risk Factors” beginning on page 33 for more information.

REE will be an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, and is therefore eligible to take advantage of certain reduced reporting requirements otherwise applicable to other public companies.

REE will also be a “foreign private issuer” as defined in the Exchange Act and will be exempt from certain rules under the Exchange Act that impose certain disclosure obligations and procedural requirements for proxy solicitations under Section 14 of the Exchange Act. In addition, REE’s officers, directors and principal shareholders will be exempt from the reporting and “short-swing” profit recovery provisions under Section 16 of the Exchange Act. Moreover, REE will not be required to file periodic reports and financial statements with the U.S. Securities and Exchange Commission as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act.

The accompanying proxy statement/prospectus provides 10X Capital stockholders with detailed information about the Merger and other matters to be considered at the Special Meeting of 10X Capital. We encourage you to read the entire accompanying proxy statement/prospectus, including the Annexes and other documents referred to therein, carefully and in their entirety. You should also carefully consider the risk factors described in “Risk Factors” beginning on page 33 of the accompanying proxy statement/prospectus.

None of the Securities and Exchange Commission, any state securities commission or the Israel Securities Authority has approved or disapproved of the securities to be issued in connection with the Merger, or determined if this proxy statement/prospectus is accurate or adequate. Any representation to the contrary is a criminal offense.

This proxy statement/prospectus is dated               , 2021, and is first being mailed to 10X Capital stockholders on or about         , 2021.

10X CAPITAL VENTURE ACQUISITION CORP
1 World Trade Center, 85th Floor
New York, NY 10007

NOTICE OF SPECIAL MEETING
IN LIEU OF 2021 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON           , 2021

TO THE STOCKHOLDERS OF 10X CAPITAL VENTURE ACQUISITION CORP:

NOTICE IS HEREBY GIVEN that a special meeting of stockholders of 10X Capital Venture Acquisition Corp, a Delaware corporation (“10X Capital”), will be held virtually at           Eastern time, on             , 2021, accessible at            or at such other time, on such other date and at such other place to which the meeting may be adjourned or postponed (the “Special Meeting”). You are cordially invited to attend the Special Meeting, which will be held for the following purposes:

(1)    to consider and vote upon a proposal to adopt the Agreement and Plan of Merger, dated as of February 3, 2021 (the “Merger Agreement”), and to approve the Merger contemplated by such agreement (the “Merger”), by and among REE Automotive Ltd., a company organized under the laws of Israel (“REE”), Spark Merger Sub Inc., a Delaware corporation and a direct, wholly-owned subsidiary of REE (“Merger Sub”), and 10X Capital, which provides for, among other things, the merger of Merger Sub with and into 10X Capital, with 10X Capital surviving as a wholly-owned subsidiary of REE (the Merger and the other transactions contemplated by the Merger Agreement, the “Transactions”). In connection with the Merger, REE will list as a publicly-traded company on Nasdaq and will continue to conduct the automotive technology business conducted by REE prior to the Merger. We refer to this proposal as the “Merger Proposal” and a copy of the Merger Agreement is attached to this proxy statement/prospectus as Annex A;

(2)    to consider and vote upon a proposal to amend 10X Capital’s amended and restated certificate of incorporation (the “Existing 10X Capital Charter”) by adopting the second amended and restated certificate of incorporation (the “Proposed 10X Capital Charter”), which will provide that, immediately prior to the consummation of the Merger, all shares of 10X Capital Class B Common Stock (as defined herein) will automatically convert into shares of 10X Capital Class A Common Stock (as defined herein) with an amended Conversion Ratio adjustment — we refer to this proposal as the “Class B Charter Proposal”;

(3)    to consider and vote upon a proposal to approve the material differences between the Existing 10X Capital Charter and REE’s articles of association to be in effect following the Merger (the “Amended and Restated Articles”) — we refer to this proposal as the “Material Differences Charter Proposal”; and

(4)    to consider and vote upon a proposal to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the Special Meeting, 10X Capital is not authorized to consummate the Merger — we refer to this proposal as the “Adjournment Proposal.”

These items of business are described in the attached proxy statement/prospectus, which we encourage you to read in its entirety before voting. Only holders of record of Class A common stock, par value $0.0001 per share, of 10X Capital (“10X Capital Class A Common Stock”) and Class B common stock, par value $0.0001 per share, of 10X Capital (“10X Capital Class B Common Stock” and collectively with 10X Capital Class A Common Stock, “10X Capital Common Stock”) at the close of business on June 2, 2021, are entitled to notice of the Special Meeting and to vote and have their votes counted at the Special Meeting and any adjournments or postponements of the Special Meeting.

After careful consideration, the 10X Capital board of directors has determined that the Merger Proposal, the Class B Charter Proposal, the Material Differences Charter Proposal and the Adjournment Proposal are advisable and fair to and in the best interest of 10X Capital and its stockholders and unanimously recommends that you vote or give instruction to vote “FOR” the Merger Proposal, “FOR” the Class B Charter Proposal, “FOR” the Material Differences Charter Proposal and “FOR” the Adjournment Proposal, if presented.

The Merger is conditioned on the approval of each of the Merger Proposal, the Class B Charter Proposal and the Material Differences Charter Proposal (the “Condition Precedent Proposals”) at the Special Meeting. Each of the Condition Precedent Proposals is cross-conditioned on the approval of each other. The Adjournment Proposal is not conditioned

upon the approval of any other proposal. Each of these proposals is more fully described in the accompanying proxy statement, which each stockholder is encouraged to read carefully and in its entirety. If the Merger Proposal is not approved by 10X Capital’s stockholders, the Merger will not be consummated.

All of 10X Capital’s stockholders are cordially invited to attend the Special Meeting virtually. To ensure your representation at the Special Meeting, however, you are urged to complete, sign, date and return the enclosed proxy card as soon as possible. If you are a stockholder of record of 10X Capital Common Stock, you may also cast your vote virtually at the Special Meeting. If your shares are held in an account at a brokerage firm or bank, you must instruct your broker or bank on how to vote your shares or, if you wish to attend the Special Meeting and vote in person, you must obtain a proxy from your broker or bank. If you do not vote or do not instruct your broker or bank how to vote, it will have the same effect as voting against the Merger Proposal, the Class B Charter Proposal, and the Material Differences Charter Proposal, but will have no effect on the Adjournment Proposal.

A complete list of 10X Capital stockholders of record entitled to vote at the Special Meeting will be available for ten (10) days before the Special Meeting at the principal executive offices of 10X Capital for inspection by stockholders during ordinary business hours for any purpose germane to the Special Meeting.

Your vote is important regardless of the number of shares you own. Whether you plan to attend the Special Meeting or not, please sign, date and return the enclosed proxy card as soon as possible in the envelope provided. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker or bank to ensure that votes related to the shares you beneficially own are properly counted. The Merger is conditioned on the approval of each of the Condition Precedent Proposals at the Special Meeting. Each of the Condition Precedent Proposals is cross-conditioned on the approval of each other. The Adjournment Proposal is not conditioned upon the approval of any other proposal. Each of the proposals is more fully described in the accompanying proxy statement, which each stockholder is encouraged to read carefully and in its entirety.

Thank you for your participation. We look forward to your continued support.

This proxy statement/prospectus is dated,             , 2021 and is first being mailed to 10X Capital stockholders on or about         , 2021.

By Order of the Board of Directors

New York, New York

        , 2021

“Founders” means Daniel Barel and Ahishay Sardes, the founders of REE.

“Insiders” means the executive officers and directors of 10X Capital.

“Investors’ Rights Agreement” means the Investors’ Rights Agreement, by and among REE, 10X Capital, the Sponsor, the Insiders, and certain REE shareholders, pursuant to which REE has agreed to grant the other parties thereto registration rights in respect of their REE Class A Ordinary Shares and certain other REE securities, and whereby the Sponsor, certain shareholders of REE and the Founders, have each agreed, subject to the terms in the Investors’ Rights Agreement, to certain limitations on transferring their REE Ordinary Shares.

“IPO” means the initial public offering of Units of 10X Capital, consummated on November 27, 2020.

“Letter Agreement” means the Letter Agreement, by and between 10X Capital, the Insiders, the Sponsor and REE, pursuant to which, the Sponsor has agreed to waive its rights to receive certain Anti-Dilution Shares in excess of 2,900,000, and has agreed to forfeit and surrender up to 1,500,000 shares of 10X Capital Class A Common Stock if certain trading prices of REE Class A Ordinary Shares are not achieved following the Merger.

“MaaS” means Mobility-as-a-Service.

“Material Differences Charter Proposal” means the proposal to approve the material differences between the Existing 10X Capital Charter and the Amended and Restated Articles to be in effect following the Merger.

“Maximum Redemption Scenario” means that all 10X Capital Public Stockholders holding approximately 19,019,200 Public Shares will exercise their redemption rights for the $190.20 million of funds in 10X Capital Corporation’s Trust Account. Each of REE’s and 10X Capital’s obligations under the Merger Agreement are subject to 10X Capital having (i) at least $225 million (the “Minimum Cash Amount”) and (ii) net tangible assets of at least $5.0 million either immediately prior to or upon consummation of the Merger.

“Merger” means the merger of Merger Sub with and into 10X Capital, with 10X Capital surviving the merger and becoming a wholly-owned subsidiary of REE, along with the other transactions contemplated by the Merger Agreement.

“Merger Agreement” means the Agreement and Plan of Merger, dated as of February 3, 2021, by and among 10X Capital, REE and Merger Sub, as such agreement may be amended or otherwise modified from time to time in accordance with its terms.

“Merger Proposal” means the proposal to adopt the Merger Agreement and approve the transactions contemplated thereby.

“Nasdaq” means the Nasdaq Stock Market.

“No Redemption Scenario” means no holder of Public Shares elects to have such shares redeemed in connection with the Merger.

“PIPE Investment” means the purchases of PIPE Shares pursuant to subscription agreements with the PIPE Investors, such purchases to be consummated immediately prior to the consummation of the Merger.

“PIPE Investors” means certain institutional accredited investors.

“PIPE Shares” means 30,000,000 shares of 10X Capital Class A Common Stock subscribed for and to be purchased by the PIPE Investors pursuant to the PIPE Subscription Agreements.

“PIPE Subscription Agreements” means the subscription agreements entered into by the PIPE Investors, pursuant to which the PIPE Investors have committed to subscribe for and purchase the PIPE Shares at a purchase price per share of $10.00.

“Private Warrants” means the 10X Capital Warrants sold to the Sponsor in a private placement in connection with the IPO.

“Prospectus” means the prospectus included in the Registration Statements on Form S-1 (Registration No. 333-249072) filed with the SEC in connection with the IPO.

“Public Shares” means shares of 10X Capital Class A Common Stock issued as part of the Units sold in the IPO.

“Public Stockholders” means the holders of Public Shares of 10X Capital.

“Public Warrants” means 10X Capital Warrants included in Units sold in the IPO.

“Redemption” means 10X Capital’s acquisition of Public Shares in connection with the Merger pursuant to the right of the holders of Public Shares to have their shares redeemed in accordance with the procedures set forth in this proxy statement/prospectus.

“REE Class A Ordinary Shares” means the Class A ordinary shares, without par value, of REE, having one vote per share.

“REE Class B Ordinary Shares” means the Class B ordinary shares, without par value, of REE, having 10 votes per share.

“REE Ordinary Shares” means the REE Class A Ordinary Shares together with the REE Class B Ordinary Shares.

“REE Preferred Shares” means the REE preferred share, par value NIS 0.01 each, of REE, which will be converted into REE Class A Ordinary Shares in accordance with REE’s organizational documents immediately prior to the Effective Time.

“REE Warrants” means warrants that will entitle the holder thereof to purchase for $11.50 per share one REE Class A Ordinary Share in lieu of one share of 10X Capital Class A Common Stock.

“SEC” means the U.S. Securities and Exchange Commission.

“Securities Act” means the U.S. Securities Act of 1933, as amended.

“Special Meeting” means the Special Meeting of the stockholders of 10X Capital, to be held virtually on         , 2021 at         . Eastern time, accessible at          or at such other time, on such other date and at such other place to which the meeting may be adjourned or postponed.

“Sponsor” means 10X Capital SPAC Sponsor LLC, a Delaware limited liability company, an initial stockholder of 10X Capital and the sole holder of 10X Capital Class B Common Stock.

“Sponsor Shares” means shares of 10X Capital Class B Common Stock, 5,031,250 of which are currently outstanding and were issued to the Sponsor prior to the IPO, which shall convert into 7,931,250 shares of 10X Capital Class A Common Stock immediately prior to the Merger based on the Conversion Ratio.

“Stock Split” means a stock split by REE to cause the value of the outstanding REE Class A Ordinary Shares immediately prior to the Effective Time to equal $10.00 per share.

“Support Agreement” means the Support Agreement pursuant to which 10X Capital, and the Sponsor have agreed, among other things, to vote their shares of 10X Capital (representing 20% of such outstanding shares), and take certain other actions, in support of the Merger, and REE and the REE shareholders party thereto have agreed, among other things, to vote their shares of REE (representing approximately 95% of such outstanding shares and, together with other shares of REE subject to proxy agreements, representing approximately 99%), and take certain other actions, in support of the Merger.

“TCO” means total cost of ownership.

“Trading Day” means any day on which the REE Class A Ordinary Shares are actually traded on the principal securities exchange or securities market on which REE Class A Ordinary Shares are then traded.

“Transaction” or “Transactions” means the transactions contemplated by the Merger Agreement and the PIPE Subscription Agreements to occur at or immediately prior to the Closing, including the Merger.

“Trust Account” means the trust account that holds a portion of the proceeds of the IPO and the concurrent sale of the Private Warrants.

“Units” means Units issued in the IPO, each consisting of one share of 10X Capital Class A Common Stock and one-half of one Public Warrant.

“UK” means the United Kingdom.

“U.S.” means the United States of America.

“U.S. dollar,” “USD,” “US$” and “$” mean the legal currency of the United States.

“U.S. GAAP” means generally accepted accounting principles in the United States.

“Warrant Agreement” means that certain Warrant Agreement, dated as of November 23, 2020, between 10X Capital and Continental Stock Transfer & Trust Company.

SUMMARY OF THE MATERIAL TERMS OF THE MERGER

The descriptions below of the material terms of the Merger are intended to be summaries of such terms. Such descriptions do not purport to be complete and are qualified in their entirety by reference to the terms of the agreements themselves.

The parties to the Merger Agreement are 10X Capital, REE and Merger Sub. Pursuant to the Merger Agreement, Merger Sub, a wholly-owned subsidiary of REE, will merge with and into 10X Capital, with 10X Capital being the surviving corporation and a direct, wholly-owned subsidiary of REE, and with the stockholders of 10X Capital becoming stockholders of REE.

Upon consummation of the Merger, including the PIPE Investment, REE will become a publicly traded company.

As consideration for the Merger, at the Effective Time of the Merger, each outstanding share of 10X Capital Class A Common Stock will be converted into the right to receive one newly issued REE Class A Ordinary Share. The Existing 10X Capital Charter provides that, upon conversion of 10X Capital Class B Common Stock into 10X Capital Class A Common Stock, the holders of 10X Capital Class B Common Stock shall be entitled to receive a number of additional Anti-Dilution Shares of 10X Capital Class A Common Stock equal to 25% of the number of shares of 10X Capital Class A Common Stock issued to the PIPE Investors. Concurrently with the execution and delivery of the Merger Agreement, 10X Capital, its Insiders, the Sponsor and REE entered into the Letter Agreement. Pursuant to the Letter Agreement, the holders of the shares of 10X Capital Class B Common Stock have agreed to waive their right to receive any Anti-Dilution Shares in excess of 2,900,000, with such waiver resulting in the Conversion Ratio. In addition, up to 1,500,000 of the 2,900,000 Anti-Dilution Shares to be received upon the conversion of 10X Capital Class B Common Stock will be subject to subsequent forfeiture without consideration if the trading prices of REE Class A Ordinary Shares specified in the Letter Agreement are not achieved following the Merger. 10X Capital’s outstanding warrants to purchase one share of 10X Capital Class A Common Stock shall be converted into the right to receive an equal number of warrants to purchase one REE Class A Ordinary Share, subject to downward adjustment to the next whole number in case of fractions of REE Warrants.

Under the Merger Agreement, upon the consummation of the Merger, (a)  each of the 20,125,000 outstanding Public Shares of 10X Capital’s Class A Common Stock (excluding shares that are redeemed) will become one REE Class A Ordinary Share, except that the holders of Public Shares shall be entitled to elect instead to have such shares redeemed and receive a pro rata portion of 10X Capital’s Trust Account, as provided in Existing 10X Capital Charter, and (b) each of the 7,931,250 Sponsor Shares of 10X Capital’s Class A Common Stock, representing the number of Sponsor Shares held in 10X Capital after the Conversion Ratio is applied, will become one REE Class A Ordinary Share. Additionally, each outstanding 10X Capital Warrant will automatically become a REE Warrant that entitles the holder to purchase one REE Class A Ordinary Share in lieu of one share of 10X Capital Class A Common Stock.

In connection with the consummation of the Merger, the following will occur:

•        immediately prior to Effective Time, REE intends to effect a stock split to cause the value of the outstanding REE Class A Ordinary Shares immediately prior to the Effective Time to equal $10.00 per share. Additionally, immediately prior to the Effective Time, (i) each issued and outstanding unit of 10X Capital comprising one share of 10X Capital Class A Common Stock and one-half of one warrant to purchase one share of 10X Capital Class A Common Stock, shall be automatically separated and the holder thereof shall be deemed to hold one share of 10X Capital Class A Common Stock and one-half of one 10X Capital Warrant; and (ii) each outstanding share of 10X Capital Class B common stock shall convert into 1.5763975 shares of 10X Capital Class A Common Stock.

•        the PIPE Investors have subscribed for and will purchase 30,000,000 shares of 10X Capital Class A Common Stock for $10.00 per share and an aggregate purchase price of $300.0 million; and

•        prior to the Effective Time, the shareholders of REE will amend REE’s Amended and Restated Articles to be substantially in the form attached hereto as Annex B.

The Merger Agreement may be terminated under certain customary and limited circumstances at any time prior the Closing, including, among other reasons:

•        by mutual written consent of 10X Capital and REE;

•        by either 10X Capital or REE if the closing of the Merger contemplated in the Merger Agreement has not occurred by August 15, 2021 (the “Outside Date”), except that the right to so terminate the Merger Agreement will not be available to any party whose action or failure to act has been a principal cause of or resulted in the failure of the Merger to occur on or before such date and such action or failure to act constitutes a material breach of the Merger Agreement;

•        by either 10X Capital or REE if a governmental entity has issued an order or decree or has taken any other action, in any case having the effect of permanently restraining, enjoining or otherwise prohibiting the Merger which order, decree or other action is final and nonappealable;

•        by REE if 10X Capital has breached any of its covenants or representations and warranties in any material respect and has not cured such breach within the time periods provided for in the Merger Agreement (subject to a 30-day cure period);

•        by 10X Capital if REE has breached any of its covenants or representations and warranties in any material respect and has not cured such breach within the time periods provided for in the Merger Agreement (subject to a 30-day cure period);

•        by either 10X Capital or REE, if, at the Special Meeting (including any adjournments thereof), the Merger Agreement, the Merger, and the other transaction proposals contemplated by the Merger Agreement are not duly adopted by 10X Capital’s stockholders by the requisite vote under applicable legal requirements and 10X Capital’s organizational documents;

•        by either 10X Capital or REE, if, at the meeting of REE’s shareholders held to approve the Merger (including any adjournments thereof), the Merger Agreement, the Merger, and the other transaction proposals contemplated by the Merger Agreement are not duly adopted by REE’s shareholders by the requisite vote under applicable legal requirements and REE’s organizational documents;

•        by REE, if, prior to receipt of approval of the stockholders of 10X Capital, the board of directors of 10X Capital changes its recommendation with respect to the Merger, as permitted by the Merger Agreement;

•        by 10X Capital, if the REE shareholders necessary to approve the Merger, the Merger Agreement, and the transactions contemplated thereby have not executed the Support Agreement within 45 days following the signing of the Merger Agreement; or

•        by either 10X Capital or REE, if, at the Closing, the condition that 10X Capital shall have at least $225,000,000 in cash and cash equivalents at the time of the Closing is incapable of being satisfied at the Closing.

At the consummation of the Merger, the current directors of REE will remain as directors, and Ahishay Sardes, Co-Founder and Chief Technology Officer of REE, and Hans Thomas, Chief Executive Officer and Chairman of 10X Capital, will each become a director of REE.

Upon completion of the Merger, the current officers of REE will remain officers of REE, holding equivalent positions to those held by them with REE prior to the Merger. See the section entitled “Management of REE Following the Merger.”

QUESTIONS AND ANSWERS ABOUT THE PROPOSALS

Pursuant to the Existing 10X Capital Charter, in connection with the completion of the Merger and assuming they cast a vote on the Merger Proposal, 10X Capital’s public stockholders may elect to have their shares redeemed for cash at the applicable redemption price per share calculated in accordance with the Existing 10X Capital Charter. Payment for such redemptions will come from the Trust Account. To the extent 10X Capital’s public stockholders elect to have their shares redeemed, the consideration to be paid will vary as described herein.

consider many factors when deciding whether to purchase REE’s products (or EVs generally) over vehicles powered by internal combustion engines, particularly diesel-fueled or natural gas-fueled vehicles. REE believes these factors include:

•        the difference in the initial purchase prices of EVs with comparable vehicles powered by internal combustion engines, both including and excluding the effect of government and other subsidies and incentives designed to promote the purchase of EVs;

•        the total cost of ownership of the vehicle over its expected life, which includes the initial purchase price and ongoing operating and maintenance costs;

•        the availability and terms of financing options for purchases of vehicles and, for EVs, financing options for battery or fuel cell systems;

•        the availability of tax and other governmental incentives to purchase and operate EVs and future regulations requiring increased use of nonpolluting vehicles;

•        government regulations and economic incentives promoting fuel efficiency and alternate forms of energy;

•        fuel prices, including volatility in the cost of diesel or a prolonged period of low gasoline and natural gas costs that could decrease incentives to transition to EVs;

•        the cost and availability of other alternatives to diesel fueled vehicles, such as vehicles powered by natural gas;

•        corporate sustainability initiatives;

•        EV quality, performance and safety (particularly with respect to lithium-ion battery packs or fuel cells);

•        the quality and availability of service for the vehicle, including the availability of replacement parts;

•        the limited range over which EVs may be driven on a single charge;

•        access to charging stations and related infrastructure costs, and standardization of EV charging systems;

•        electric grid capacity and reliability; and

•        macroeconomic factors.

If, in weighing these factors, OEMs, logistics companies and service providers determine that there is not a compelling business justification for purchasing EVs, particularly those built on the REE products, then the market for EVs may not develop as REE expects or may develop more slowly than REE expects, which would adversely affect REE’s business, prospects, financial condition and operating results.

In addition, any reduction, elimination or selective application of tax and other governmental incentives and subsidies because of policy changes, the reduced need for such subsidies and incentives due to the perceived success of the EV, fiscal tightening or other reasons may result in the diminished competitiveness of the EV industry generally or EVs built on the REE products in particular, which would adversely affect REE’s business, prospects, financial condition and operating results. Further, REE cannot assure that the current governmental incentives and subsidies available for purchasers of EVs will remain available.

Adverse conditions in the automotive industry could have adverse effects on REE’s results of operations.

REE’s business is directly affected by and significantly dependent on business cycles and other factors affecting the global automobile industry. Automotive production and sales are highly cyclical and depend on general economic conditions and other factors, including consumer spending and preferences, changes in interest rates and credit availability, consumer confidence, fuel costs, fuel availability, environmental impact, governmental incentives and regulatory requirements and political volatility, especially in energy-producing countries and growth markets. In addition, automotive production and sales can be affected by REE’s potential customers’ and potential suppliers’ and strategic partners’ ability to continue operating in response to challenging economic conditions and in response to regulatory requirements and other factors. The volume of global automotive production has fluctuated, sometimes

significantly, from year to year, and REE expects any such fluctuations to give rise to fluctuations in the demand for its products. Any significant adverse change in any of these factors may result in a reduction in automotive sales and production by REE’s potential customers and potential suppliers and strategic partners and could have a material adverse effect on REE’s business, results of operations and financial condition.

REE’s future sales and operations in international markets may expose it to operational, financial and regulatory risks, including but not limited to unfavorable regulatory, political, tax and labor conditions which could negatively impact the business.

REE faces risks associated with its international operations, including possible unfavorable regulatory, political, tax and labor conditions, which could harm its business. REE has international operations and subsidiaries in Israel, the U.S., the UK and Germany that are subject to the legal, political, regulatory and social requirements and economic conditions in these jurisdictions. Additionally, as part of its growth strategy, REE intends to expand its manufacturing partnerships, assembly facilities and sales activity internationally. However, REE has no experience to date selling, manufacturing or assembling its products internationally and such expansion would require REE to make significant expenditures, including the hiring of local employees and establishing facilities, in advance of generating any revenue. REE is subject to a number of risks associated with international business activities that may increase its costs, impact its ability to sell its products and require significant management attention. These risks include:

•        conforming REE’s products to various international regulatory requirements where its products are sold, or homologation;

•        development and construction of its future integration center network;

•        difficulty in staffing and managing foreign operations;

•        difficulties attracting customers in new jurisdictions;

•        foreign government taxes, regulations and permit requirements, including foreign taxes that REE may not be able to offset against taxes imposed upon it in Israel, and foreign tax and other laws limiting REE’s ability to repatriate funds to Israel;

•        fluctuations in foreign currency exchange rates and interest rates, including risks related to any interest rate swap or other hedging activities REE undertakes;

•        Israel and foreign government trade restrictions, tariffs and price or exchange controls;

•        foreign labor laws, regulations and restrictions;

•        changes in diplomatic and trade relationships;

•        political instability, natural disasters, war or events of terrorism; and

•        the strength of international economies.

If REE fails to successfully address these risks, its business, prospects, operating results and financial condition could be materially harmed.

REE is subject to risks related to health epidemics and pandemics, including the ongoing COVID-19 pandemic, which could adversely affect REE’s business and operating results.

REE faces various risks related to public health issues, including epidemics, pandemics, and other outbreaks, including the ongoing COVID-19 pandemic. The effects and potential effects of COVID-19, including, but not limited to, its impact on general economic conditions, trade and financing markets, changes in customer behavior and continuity in business operations creates significant uncertainty. The spread of COVID-19 also disrupted the manufacturing, delivery and overall supply chain of vehicle manufacturers and suppliers, and has led to a global decrease in vehicle sales in markets around the world. In particular, the COVID-19 crisis may cause a decrease in demand for REE’s products if OEMs, logistics companies and service providers delay purchases of vehicles or if fuel prices for internal combustion engine vehicles remain low, an increase in costs resulting from REE’s efforts to mitigate the effects of COVID-19, delays in REE’s schedule to full commercial production of the REEcorner and disruptions to REE’s supply chain, among other negative effects.

The pandemic has resulted in government authorities implementing many measures to contain the spread of COVID-19, including travel bans and restrictions, quarantines, shelter-in-place and stay-at-home orders, and business shutdowns. These measures may be in place for a significant period of time and may be reinstituted if conditions deteriorate, which could adversely affect REE’s start-up and manufacturing plans. Measures that have been relaxed may be reimplemented if COVID-19 continues to spread. If, as a result of these measures, REE has to limit the number of employees and contractors in REE facilities at a given time, it could cause a delay in retooling efforts or in the production schedule of the REEcorner. Further, REE’s sales and marketing activities may be adversely affected due to the cancellation or reduction of in-person sales activities, meetings, events and conferences. If REE’s workforce is unable to work effectively, including due to illness, quarantines, government actions or other restrictions in connection with COVID-19, REE’s operations will be adversely affected.

The extent to which the COVID-19 pandemic may continue to affect REE’s business will depend on continued developments, which are uncertain and cannot be predicted. Even after the COVID-19 pandemic has subsided, REE may continue to suffer an adverse effect to REE’s business due to its global economic effect, including any economic recession. If the immediate or prolonged effects of the COVID-19 pandemic have a significant adverse impact on government finances, it would create uncertainty as to the continuing availability of incentives related to EV purchases and other governmental support programs.

Risks Related to REE’s Strategy

REE’s business model has yet to be tested and any failure to commercialize its products could have an adverse effect on its operating results, business, or reputation, resulting in substantial liabilities that may exceed its resources.

REE strives to be the cornerstone upon which global mobility companies build any size or shape of electric car, van, or truck on a modular and scalable platform for various applications or target markets. REE believes that this approach will allow it to complete, and not compete with, other EV players such as vertically integrated OEMs, mobility and logistic players. REE plans to embrace traditional Tier 1 suppliers and their global manufacturing capacity, instead of directly competing with them. If REE is perceived to be a competitor by other EV players, REE may not be successful in its goal to complete rather than to compete. This approach depends in large part on REE’s ability to enter into definitive agreements that formalize its relationship with potential customers, suppliers and strategic partners. Investors should be aware of the difficulties normally encountered by a new enterprise, many of which are beyond REE’s control, including substantial risks and expenses in the course of establishing or entering new markets, organizing operations and undertaking marketing activities. The likelihood of REE’s success must be considered in light of these risks, expenses, complications, delays and the competitive environment in which REE operates. In addition, REE’s plan to outsource manufacturing to potential suppliers and strategic partners and to utilize future integration centers for the assembly of REE products is a novel business strategy and REE cannot guarantee that the strategy will be successful or profitable. REE may be unable to generate revenues, raise additional capital or operate profitably or to meet projected gross margins, EBITDA and cash flows. REE will continue to encounter risks and difficulties frequently experienced by early development stage companies, including scaling up REE’s infrastructure and headcount, and may encounter unforeseen expenses, difficulties or delays in connection with its growth. In addition, REE expects to continue to sustain substantial operating expenses without generating sufficient revenues to cover expenditures. Any investment in REE is therefore highly speculative and could result in the loss of your entire investment.

REE’s marketing and sales model is different from predominant and current models in the automobile industry, making evaluation of its business, operating results and future prospects difficult. Should such a model fail to achieve market acceptance, REE may not be able to achieve profitability.

REE plans to conduct product marketing and sales directly to OEMs, logistics companies and service providers by its internal business development and marketing teams. REE’s business development and marketing teams continue to focus on expanding relationships with OEMs, logistic and commercial players, mobility providers and e-commerce leaders and to expand its market to other industries. This marketing and sales model is different from the currently predominant marketing and sales model for automobile manufacturers, which makes evaluating its business, operating results and future prospects difficult. This model of product marketing and sale is relatively new and, with limited exceptions, unproven. For example, REE will not be able to utilize long established sales channels developed through a franchise system to increase sales volume. REE’s success will depend in large part on its ability to effectively develop its own distribution channels and marketing strategies. If REE is unable to achieve this, it could have a material adverse effect on its business, prospects, financial results and results of operations.

REE’s agreements with potential customers, potential suppliers and potential strategic partners are preliminary in nature.

All of REE’s existing agreements with potential customers, potential suppliers and potential strategic partners are pursuant to MOUs or strategic, alliance and development agreements. Such strategic collaborations are generally non-binding and subject to cancellation or require the achievement of development milestones as a precursor to entering into a further definitive agreement. There can be no guarantee that any of REE’s strategic collaborations would lead to any definitive agreements or lasting or successful business relationships with such potential customers, potential suppliers or potential strategic partners and failure to do so would have a material adverse effect on its business, prospects, financial results and results of operations.

REE may not succeed in establishing, maintaining and strengthening the “Powered by REE” brand, which could materially and adversely affect customer acceptance of its vehicles and components, thus negatively impacting its business, prospects and projected revenue.

REE intends to market its products as both individual products or as a full vehicle solution under the “Powered by REE” brand. The “Powered by REE” approach reflects REE’s mission to become the cornerstone upon which mobility players can build their mission-specific vehicle needs with the goal of completing rather than competing with other market participants. REE’s business and prospects are heavily dependent on its ability to develop, maintain and strengthen the “Powered by REE” brand and the REE brand generally. If REE does not continue to establish, maintain and strengthen its brand, it may lose the opportunity to build a critical mass of customers. Promoting and positioning its brand will likely depend significantly on REE’s ability to provide high quality products and engage with its potential customers as intended, and REE has limited experience in these areas. In addition, REE’s ability to develop, maintain and strengthen the “Powered by REE” brand and the REE brand generally will depend heavily on the success of its customer development and branding efforts. REE’s novel technology and design may not align with existing consumer preferences and consumers may be reluctant to acquire a vehicle build upon a new and unproven EV platform. In addition, REE could be subject to adverse publicity related to REE’s potential customers who build vehicles on REEplatforms whether or not such publicity related to such potential customers’ “Powered by REE” vehicles; given the popularity of social media, any negative publicity, whether true or not, could quickly proliferate and harm consumer perceptions and confidence in the “Powered by REE” brand and the REE brand generally. If REE does not develop and maintain a strong brand, its business, prospects, financial condition and operating results will be materially and adversely impacted.

REE will be subject to risks associated with strategic alliances.

If REE is successful in entering into definitive agreements with potential suppliers or potential strategic partners the resulting alliances will subject us to a number of risks, including risks associated with non-performance by the third party and sharing proprietary information, any of which may materially and adversely affect REE’s business and prospects. REE’s limited ability to monitor or control the actions of these third parties and, to the extent any of these strategic third parties suffers negative publicity or harm to their reputation from events relating to their business, REE may also suffer negative publicity or harm to its reputation by virtue of its association with any such third party.

REE operates in a highly competitive market against a large number of both established competitors and new market entrants, and many market participants have substantially greater resources than REE.

Both the automobile industry generally, and the EV segment in particular, are highly competitive, and REE will be competing for sales with both internal combustion engine (“ICE”) vehicles and EVs. Many of REE’s current and potential competitors have significantly greater financial, technical, manufacturing, marketing and other resources than REE does and may be able to devote greater resources to the design, development, manufacturing, distribution, promotion, sale and support of their products. REE expects competition for EVs to intensify due to increased demand and a regulatory push for alternative fuel vehicles, continuing globalization, and consolidation in the worldwide automotive industry. Factors affecting competition include product quality and features, innovation and development time, pricing, reliability, safety, fuel economy, customer service, and financing terms. Increased competition may lead to lower vehicle unit sales and increased inventory, which may result in downward price pressure and adversely affect REE’s business, financial condition, operating results, and prospects.

REE’s products will compete for market share with vehicles powered by other vehicle technologies that may prove to be more attractive than that of REE. Such competition may ultimately impair REE’s business and revenue.

REE’s target market currently is serviced by manufacturers with existing customers and suppliers using proven and widely accepted fuel technologies. Additionally, REE’s competitors are working on developing technologies that may be introduced in REE’s target market. If any of these alternative technology vehicles can provide lower fuel costs, greater efficiencies, greater reliability or otherwise benefit from other factors resulting in an overall lower total cost of ownership, this may negatively affect the commercial success of REE’s products or make REE’s products uncompetitive or obsolete.

REE may not be able to compete successfully in the market as a result of rapid changes in EV technology and the entrance of new and existing, larger manufacturers into the EV space.

REE’s products are being designed for use with, and depend upon, existing vehicle technology. As new companies and larger, existing vehicle manufacturers enter the EV space, REE may lose any technological advantage it may have had in the marketplace and suffer a decline in its position in the market. As technologies change, REE plans to upgrade or adapt its products to continue to provide products with the latest technology. However, REE’s products may become obsolete or REE’s research and development efforts may not be sufficient to adapt to changes in or to create the necessary technology to effectively compete. As a result, REE’s potential inability to adapt and develop the necessary technology may harm REE’s competitive position.

Risks Related to Development and Production of REE’s Products

REE’s products are currently in development and there are risks associated with developing existing advanced prototypes into marketable products.

REE’s products are currently in development and are in a prototype stage. In order to reach the production stage REE’s products remain subject to further design, validation, verification and testing, as well as product homologation. There is no guarantee that REE will be successful in developing the prototypes into final marketable products on the projected timeline, or at all. As of now, REE has been able to perform only limited testing of REE’s products, largely as a result of a lack of dedicated testing facilities. The establishment of the Engineering Center of Excellence at the MIRA Technology Park in the UK is expected to provide REE with access to world-class test facilities and a proving ground for physical testing and validation of the REE products. However, there can be no guarantee that the testing of REE’s products will proceed according to schedule or that the REE products will withstand rigorous testing. The development of REE’s advanced prototypes into final marketable products is and will be subject to risks including, but not limited to, with respect to:

•        REE’s ability to validate final marketable products that are capable of supporting Class 1 through Class 6 platform models as currently projected;

•        REE’s ability to completely the final marketable product design process on time, if at all;

•        REE’s ability to produce design drawings in order to allow potential suppliers and potential strategic partners to prepare for and begin manufacture of REE products on time, if at all;

•        the ability for REE’s prototype to meet the stringent level of safety measures required by ASIL D;

•        REE’s ability to obtain ASPICE CL2 certification;

•        the ability for REE’s prototypes to withstand rigorous testing and validation;

•        the ability for REE’s prototypes to satisfy testing and validation standards set by external assessors;

•        the ability of REE’s prototypes to meet existing or future automotive industry standards;

•        REE’s ability to successfully develop and validate true X-by-Wire Control capabilities compatible with Class 1 through Class 6 platform models as currently projected; and

•        the ability of X-by-Wire Control technology to obtain regulatory approval and achieve widespread market acceptance.

REE is subject to risks associated with REE’s anticipated initial commercial production in 2022 and subsequent increased commercial production in 2023.

REE is currently targeting initial commercial production of its products in 2022. REE does not know whether its potential suppliers or strategic partners will be able to develop efficient, automated, low-cost production capabilities and processes and reliable sources of component supply, that will enable REE to meet the quality, price, engineering, design and production standards, as well as the production volumes, required to successfully mass market REE’s products. Even if REE and its potential suppliers and strategic partners are successful in developing its initial production and further high volume production capability and processes and reliably source its component supply, REE does not know whether it will be able to do so in a manner that avoids significant delays and cost overruns, including as a result of factors beyond its control such as problems with potential suppliers and strategic partners, or force majeure events, or in time to meet REE’s products commercialization schedules or to satisfy the requirements of it potential customer base. Any failure to develop such production processes and capabilities within REE’s projected costs and timelines could have a material adverse effect on its business, prospects, financial condition and operating results.

REE’s development of an outsourced manufacturing business model may not be successful, which could harm its ability to deliver products and recognize revenue.

REE’s business depends in large part on its ability to develop, manufacture and assemble its products. Initially, REE plans to outsource the manufacturing of its products in collaboration with one or more potential suppliers and potential strategic partners, including Tier 1 automotive suppliers. REE plans to assemble its products at REE’s future integration centers. REE has not yet executed definitive supply or manufacturing agreements with potential suppliers and potential strategic partners for production of REE’s products or any of its other future product offerings. See “REE’s Business — REE’s Manufacturing Approach” for more information. If REE is unable to negotiate and finalize such definitive agreements it will not be able to produce any products and will not be able to generate any revenue, or the products may become more expensive to deliver with a higher bill of materials, which would have a material adverse effect on its business, prospects, operating results and financial condition. In addition, the utilization of future integration centers for the assembly of REE products is an untested business strategy and there is no guarantee that the strategy will be successful or profitable.

If REE’s potential suppliers and strategic partners were to experience delays, disruptions, capacity constraints or quality control problems in its manufacturing operations, product shipments could be delayed or rejected or REE’s potential customer base could consequently elect to change product demand. These disruptions would negatively impact REE’s revenues, competitive position and reputation. In addition, REE’s potential suppliers and strategic partners may rely on certain state tax incentives that may be subject to change or elimination in the future, which could result in additional costs and delays in production if a new manufacturing site must be obtained. Further, if REE is unable to manage successfully its relationship with its potential suppliers and strategic partners, the quality and availability of its products may be harmed. REE’s potential suppliers and strategic partners could, under some circumstances, decline to accept new purchase orders from or otherwise reduce their business with REE. If REE’s potential suppliers and strategic partners stopped manufacturing REE’s products for any reason or reduced manufacturing capacity, REE may be unable to replace the lost manufacturing capacity on a timely and comparatively cost-effective basis, which would adversely impact its operations.

REE’s reliance on its potential suppliers and strategic partners, as well as the establishment and operation of REE’s future integration centers, exposes it to a number of risks which are outside its control, including with respect to:

•        the manufacture of certain components will require significant costs related to non-recurring engineering and tooling costs incurred by REE’s potential suppliers and strategic partners the extent of which is currently unknown;

•        unexpected increases in manufacturing costs;

•        interruptions in shipments if a potential suppliers or strategic partners are unable to complete production in a timely manner;

•        inability to control quality of finished products;

•        inability to control delivery schedules;

•        inability to control production levels and to meet minimum volume commitments to REE’s potential customer base;

•        inability to control manufacturing yield;

•        inability to maintain adequate manufacturing capacity;

•        inability to secure adequate volumes of acceptable components at suitable prices or in a timely manner;

•        inability to establish new integration centers at the projected cost of $15 million per integration center;

•        inability to accurately assemble products within specified design tolerances;

•        delays by REE in delivering final component designs to its potential suppliers and strategic partners;

•        inability to implement a sufficient number of future integration centers in order to meet demand for REE products in time;

•        inability to implement a network of future integration;

•        inability to effectively manage a global network of integration centers; and

•        other delays, backlog in manufacturing and research and development of new models, and cost overruns.

REE’s ability to develop, manufacture and obtain required regulatory approvals for products of sufficient quality and appeal to its potential customer base on schedule and on a large scale is unproven, and the business plan is still evolving. REE may be required to introduce new products models and enhanced versions of existing models. To date, REE has limited experience, as a company, designing, testing, manufacturing, marketing and selling or leasing its electric products and therefore cannot assure you that it will be able to meet customer expectations. Any failure to develop such manufacturing processes and capabilities within REE’s projected costs and timelines would have a material adverse effect on its business, prospects, operating results and financial condition.

REE does not currently have any plans to establish manufacturing facilities of its own so failure to establish sufficient agreements with potential suppliers and strategic partners would significantly hinder REE’s ability to manufacture its products. In addition, the manufacturing facilities of REE’s potential suppliers and strategic partners may be harmed or rendered inoperable by natural or man-made disasters, including earthquakes, flooding, fire and power outages, or by health epidemics, such as the recent COVID-19 pandemic, which may render it difficult or impossible for REE to manufacture its products for some period of time. The inability to manufacture REE’s products or the backlog that could develop if the manufacturing facilities of its potential suppliers and strategic partners are inoperable for even a short period of time may result in the loss of potential customers or harm REE’s reputation.

REE is reliant on its UK Engineering Center of Excellence for the design, validation, verification, testing and homologation of its products.

On February 16, 2021, REE announced the establishment of a new UK Engineering Center of Excellence at the MIRA Technology Park in the UK (the “Engineering Center”). The new Engineering Center is intended to expedite REE’s strategic plans to meet anticipated global demand. The Engineering Center will spearhead REE product design, validation, verification and testing, as well as product homologation. REE will also have access to world-class test facilities and a proving ground for physical testing and validation of the REE products at the Engineering Center. The Engineering Center, and the facilities available therein, will be integral to REE’s ability to develop its advanced prototypes into marketable products. Any loss of access or disputes related to the Engineering Center have the potential to adversely impact REE’s ability to develop its advanced prototypes into marketable products on time to meet commercialization timeline, or at all.

REE’s utilization of its Engineering Center is and will be subject to risks, including with respect to:

•        REE’s ability to maintain arrangements on reasonable terms with third parties for the provision of testing facilities and testing services with respect to REE products;

•        REE’s ability to maintain the lease on reasonable terms and associated risks related to disputes involving the lessor of the Engineering Facility;

•        REE’s ability to attract, recruit, hire, retain and train a sufficient number of skilled employees to effectively staff the Engineering Center;

•        REE’s reliance on outside contractors for the provision of certain services and associated risks related to monitoring and protecting IP, contractual disputes and certain inherent cybersecurity risks;

•        Potential future changes of control resulting from a sale of the MIRA Technology Park or resulting from a bankruptcy proceeding with respect to MIRA; and

•        Limited availability of testing facilities when required for validation, verification and testing of REE products resulting from the shared nature of the MIRA Technology Park and inherent delays related thereto.

The testing facilities available to REE at the Engineering Center would be costly to replace and could require substantial lead time to replace and qualify for use. The testing facilities may be harmed or rendered inoperable by natural or man-made disasters, including earthquakes, flooding, fire and power outages, or by health epidemics, such as the recent COVID-19 pandemic, which may render it difficult or impossible for REE to validate, verify and test REE products for some period of time. The inability to validate, verify and test REE products or the resulting delay to REE’s commercialization schedule if the testing facilities are inoperable for even a short period of time may result in the loss of potential customers or harm REE’s reputation.

Technology in the automotive industry is rapidly evolving and developments in alternative technologies, including but not limited to hydrogen, may adversely affect the demand for REE’s products. Such unforeseen developments in technology may adversely affect market adoption of REE’s current products or future product developments.

REE may be unable to keep up with changes in EV technology or alternatives to electricity as a fuel source and, as a result, its competitiveness may suffer. Developments in alternative technologies, such as advanced diesel, ethanol, hybrids, fuel cells, or compressed natural gas, or improvements in the fuel economy of the internal combustion engine, may materially and adversely affect REE’s business and prospects in ways REE does not currently anticipate. Any failure by REE to successfully react to changes in existing technologies could materially harm its competitive position and growth prospects.

REE’s products may make use of lithium-ion battery cells, which can be dangerous in certain circumstances, including but not limited to the possibility that such cells may catch fire or vent smoke and flame.

The fuel source for REE products may make use of lithium-ion cells. On rare occasions, lithium-ion cells can rapidly release the energy they contain by venting smoke and flames in a manner that can ignite nearby materials as well as other lithium-ion cells. While REE has taken measures to enhance the safety of its designs, a field or testing failure of its products could occur in the future, which could subject REE to lawsuits, product recalls, or redesign efforts, all of which would be time-consuming and expensive. Also, negative public perceptions regarding the suitability of lithium-ion cells for automotive applications or any future incident involving lithium-ion cells such as a vehicle or other fire, even if such incident does not involve REE’s products, could seriously harm its business.

In addition, REE’s potential suppliers and strategic partners are expected to store a significant number of lithium-ion cells at their facilities. Any mishandling of battery cells may cause disruption to the operation of such facilities. A safety issue or fire related to the cells could disrupt operations or cause manufacturing delays. Such damage or injury could lead to adverse publicity and potentially a safety recall. Moreover, any failure of a competitor’s EV or energy storage product may cause indirect adverse publicity for REE and its products. Such adverse publicity could negatively affect REE’s brand and harm its business, prospects, financial condition and operating results.

The efficiency of battery usage in EVs declines over time, which may negatively impact potential customers’ decisions with regards to purchasing REE’s products.

REE anticipates that the range of its products will decline over time as the batteries deteriorate. REE currently expects a 3% to 4% decline in the battery life per year, which will decrease the range of its products over five years by approximately 20%. Other factors such as usage, time and stress patterns may also impact the battery’s ability to hold a charge, which would decrease REE’s products’ range before needing to refuel. Such battery deterioration and the related decrease in range may negatively influence potential customer decisions, which would negatively affect REE’s operating results and financial condition.

Risks Related to REE’s Potential Suppliers

REE’s growth depends upon REE’s ability to develop and maintain relationships with its potential suppliers, such as source suppliers for critical components, and the completion of its supply chain while effectively managing the risks of to such relationships.

REE has entered into a number of MOUs and strategic, alliance and development agreements with certain strategic partners pursuant to which the parties are entering into discussions to evaluate or agree upon a development and strategic plan. REE has not yet entered into any definitive agreements pursuant to which any potential suppliers or strategic partners will produce REE’s products. In order to implement its business model requiring limited capital expenditures, REE will need to enter into definitive agreements with one or more potential suppliers and strategic partners in order to produce REE’s products in a manner contemplated by its business plan. Furthermore, REE has explored and intends to secure alternative suppliers and strategic partners for many of the most material aspects of its business model.

Collaboration with potential suppliers and strategic partners for the manufacturing of REE products is subject to risks with respect to operations that are outside REE’s control. REE could experience delays to the extent its potential suppliers or strategic partners do not continue doing business with REE, meet agreed upon timelines, experience capacity constraints or otherwise are unable to deliver components or manufacture products as expected. There is risk of disputes with potential suppliers and strategic partners, and REE could be affected by adverse publicity related to its potential suppliers or strategic partners whether or not such publicity is related to their collaboration with REE. REE’s ability to successfully build a premium brand could also be adversely affected by perceptions about the quality of REE’s potential suppliers or strategic partner’s products or other products manufactured by the same potential suppliers or strategic partners. In addition, although REE intends to be involved in material decisions in the supply chain and manufacturing process, given that REE also will rely on its potential suppliers and strategic partners to meet its quality standards, there can be no assurance that REE will be able to maintain high quality standards.

REE will depend on its potential suppliers, including but not limited to body manufacturers and battery providers, some of which will be single or limited source suppliers, and the inability of such suppliers to deliver the components of REE’s products in a timely manner or at all and at prices and volumes acceptable to it could have a material adverse effect on its business, prospects and operating results.

REE will rely on potential suppliers and strategic partners for the provision and development of many of the components and materials used in its products. While REE plans to obtain components from multiple sources whenever possible, some of the components used in its products are expected to be purchased by REE from a single source. REE’s potential suppliers and strategic partners may not be able to meet their product specifications and performance characteristics, which would impact REE’s ability to achieve its product specifications and performance characteristics as well. Additionally, REE’s potential suppliers and strategic partners may be unable to obtain required certifications for their products for which REE plans to use or provide warranties that are necessary for REE’s solutions. If REE is unable to obtain components and materials used in its products from its potential suppliers or if its potential suppliers decide to create or supply a competing product, REE’s business could be adversely affected. REE has less negotiating leverage with potential suppliers than larger and more established automobile manufacturers and may not be able to obtain favorable pricing and other terms. While REE believes that it may be able to establish alternate supply relationships and can obtain or engineer replacement components for its single source components, REE may be unable to do so in the short term, or at all, at prices or quality levels that are favorable to REE, which could have a material adverse effect on its business, prospects, financial condition and operating results.

REE expects to purchase various types of equipment, raw materials and manufactured component parts from its potential suppliers or strategic partners. If these potential suppliers or strategic partners experience substantial financial difficulties, cease operations, or otherwise face business disruptions, REE may be required to provide substantial financial support to ensure supply continuity or would have to take other measures to ensure components and materials remain available. Any disruption could affect’s REE’s ability to deliver products and could increase REE’s costs and negatively affect its liquidity and financial performance.

REE’s business could be harmed by increases in costs, disruption of supply or shortage of materials, in particular for lithium-ion battery cells.

REE and its potential suppliers may experience increases in the cost of or a sustained interruption in the supply or shortage of materials. Any such increase, supply interruption or shortage could materially and negatively impact REE’s business, prospects, financial condition and operating results. REE and its potential suppliers will use various materials in their businesses and products, including for example lithium-ion battery cells and steel, and the prices for these materials fluctuate. The available supply of these materials may be unstable, depending on market conditions and global demand, including as a result of increased production of EVs by REE’s competitors, and could adversely affect REE’s business and operating results.

Risks Related to REE’s Future Sales

Although REE has projected unit sales based on assessment of strategic collaborations and with the possibility of sales to potential partners, considering a range of assumptions, REE has not entered into any definitive purchase agreements with potential customers.

As set forth in “Proposal No. 1 — The Merger Proposal — Certain Unaudited Prospective Financial Information of REE,” REE has projected unit sales of approximately 737,000 REE platforms through the end of 2026, of which 260,000 platforms are represented by references to vehicles to be co-developed in the coming years by REE and its strategic partners in signed strategic collaborations. REE’s projections are based on REE’s assessment of such strategic collaborations and the possibility of sales to potential partners, considering a range of assumptions including, but not limited to, volumes, timelines, average selling prices, the development and commercialization of REE’s products, potential market and sector opportunities, the roll out of REE’s future integration centers locations, the production capacity of REE’s future integration centers, the selection of REE’s products by customers and by segment, and growth in the various markets REE is targeting, and it is possible that a significant number of potential customers will ultimately not execute definitive purchase agreements. While REE believes the strategic collaborations support REE’s potential growth trajectory, such strategic collaborations generally are non-binding and certain of the strategic collaborations may be terminated for convenience by either party. REE’s strategic collaborations generally do not set forth specific development timeframes or represent a commitment by either party to develop, produce or deliver REE’s products. Additionally, the projected unit sales do not represent sales or purchase obligations unless and until definitive purchase agreements are signed. Given the anticipated lead times that may occur before production and delivery of REE’s products, there is a heightened risk that potential customers may not execute definitive purchase agreements due to potential changes in customer preferences, competitive developments and other factors. As a result, no assurance can be made that REE’s projections of unit sales will reflect the actual sale of REE products in the future. Any deviation from REE’s projections could harm REE’s financial condition, business, prospects and operating results. For additional information regarding the assumptions underlying REE’s projected unit sales, see “Proposal No. 1 — The Merger Proposal — Certain Unaudited Prospective Financial Information of REE.”

REE currently targets potential customers that are large corporations with substantial negotiating power, exacting product, quality and warranty standards and potentially competitive internal solutions.

Many of REE’s potential customers are large, multinational corporations with substantial negotiating power relative to it and, in some instances, that may have internal solutions that are competitive to REE’s products. These large, multinational corporations also have significant development resources, which may allow them to acquire or develop independently, or in partnership with others, competitive technologies. Meeting the technical requirements and securing design wins with any of these companies will require a substantial investment of REE’s time and resources. REE cannot assure you that its products will secure design wins from these or other companies or that it will generate meaningful revenue from the sales of its products to these key potential customers. If REE’s products are not selected by these large corporations or if these corporations develop or acquire competitive technology, it will have an adverse effect on REE’s business. In addition, if REE is unable to sell its products to such potential customers on certain terms, its prospects and results of operations may be adversely affected.

Discontinuation, lack of commercial success, or loss of business with respect to a particular product model for which REE is a significant supplier could reduce REE’s sales and adversely affect its profitability.

If REE is able to secure design wins and its REE products are included in these EV products, it expects to enter into supply agreements with the relevant customers. Market practice dictates that these supply agreements typically require REE to supply a customer’s requirements for a particular vehicle model or product. These contracts can have short

terms and/or can be subject to renegotiation, sometimes as frequently as annually, all of which may affect product pricing, and may be terminated by REE’s potential customers at any time. Therefore, even if REE is successful in obtaining design wins and the systems into which its products are built are commercialized, the discontinuation of, the loss of business with respect to, or a lack of commercial success of a particular vehicle model for which REE is a significant supplier could mean that the expected sales of REE’s products will not materialize, materially and adversely affecting its business.

Pricing pressures, automotive OEM cost reduction initiatives and the ability of automotive OEMs to re-source or cancel vehicle or technology programs may result in lower than anticipated margins, or losses, which may adversely affect REE’s business.

Cost-cutting initiatives adopted by REE’s potential customer base often result in increased downward pressure on pricing. REE expects that its future agreements with automotive OEMs may require step-downs in pricing over the term of the agreement or, if commercialized, over the period of production. In addition, REE’s automotive OEM customers are expected to reserve the right to terminate their supply contracts for convenience, which enhances their ability to obtain price reductions. Automotive OEMs also possess significant leverage over their suppliers, including REE, because the automotive component supply industry is highly competitive, serves a limited number of customers and has a high fixed cost base. Accordingly, REE expects to be subject to substantial continuing pressure from automotive OEMs and Tier 1 suppliers to reduce the price of its products. It is possible that pricing pressures beyond REE’s expectations could intensify as automotive OEMs pursue restructuring, consolidation and cost- cutting initiatives. If REE is unable to generate sufficient production cost savings in the future to offset price reductions, its gross margin and profitability would be adversely affected.

The average selling prices of REE’s products could decrease rapidly over the life of the products, which may negatively affect REE’s revenue and gross margin.

REE expects the average selling prices of its products generally to decline as its potential customer base seeks to commercialize EVs built on the REE products at prices low enough to achieve market acceptance. In order to sell products that have a falling average unit selling price and maintain margins at the same time, REE will need to continually reduce products and manufacturing costs. To manage manufacturing costs, REE must engineer the most cost-effective design for its products. In addition, REE will continuously drives initiatives to reduce labor cost, improve worker efficiency, reduce the cost of materials, use fewer materials and further lower overall product costs by carefully managing component prices, inventory and shipping cost. REE also needs to continually introduce new products with higher sales prices and gross margin in order to maintain its overall gross margin. If REE is unable to manage the cost of older products or successfully introduce new products with higher gross margin, its revenue and overall gross margin would likely decline.

Risks Related to REE’s Quality

REE’s products rely on software and hardware that is highly technical, and if these systems contain errors, bugs or vulnerabilities, or if REE is unsuccessful in addressing or mitigating technical limitations in its systems, REE’s business could be adversely affected.

REE’s products rely on software and hardware that is highly technical and complex and will require modification and updates over the life of the products. In addition, REE’s products depend on the ability of such software and hardware to store, retrieve, process and manage immense amounts of data. REE’s software and hardware may contain, errors, bugs or vulnerabilities, and REE’s systems are subject to certain technical limitations that may compromise REE’s ability to meet its objectives. Some errors, bugs or vulnerabilities inherently may be difficult to detect and may only be discovered after the code has been released for external or internal use. Errors, bugs, vulnerabilities, design defects or technical limitations may be found within REE’s software and hardware. Although REE attempts to remedy any issues it observes in its products as effectively and rapidly as possible, such efforts may not be timely, may hamper production or may not be to the satisfaction of REE’s potential customer base. Additionally, if REE is able to deploy updates to the software addressing any issues but REE’s over-the-air update procedures fail to properly update the software, REE’s potential customer base would then be responsible for installing such updates to the software and their software will be subject to these vulnerabilities until they do so. If REE is unable to prevent or effectively remedy errors, bugs, vulnerabilities or defects in its software and hardware, REE may suffer damage to its reputation, loss of customers, loss of revenue or liability for damages, any of which could adversely affect REE’s business and financial results.

REE may become subject to product liability claims, which could harm its financial condition and liquidity if it is not able to successfully defend or insure against such claims.

REE may become subject to product liability claims, even those without merit, which could harm its business, prospects, operating results, and financial condition. The automobile industry experiences significant product liability claims and REE faces inherent risk of exposure to claims in the event its products do not perform as expected or malfunction resulting in personal injury or death. REE’s risks in this area are particularly pronounced given it has limited field experience of its products. A successful product liability claim against REE could require REE to pay a substantial monetary award. 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 candidates, which would have a material adverse effect on REE’s brand, business, prospects and operating results. Any insurance coverage might not be sufficient to cover all potential product liability claims. Any lawsuit seeking significant monetary damages either in excess of REE’s coverage, or outside of REE’s coverage, may have a material adverse effect on REE’s reputation, business and financial condition. REE may not be able to secure additional product liability insurance coverage on commercially acceptable terms or at reasonable costs when needed, particularly if it does face liability for its products and are forced to make a claim under its policy.

REE does not currently have experience servicing its products. If REE is unable to address the service requirement of its potential customer base, its business may be materially adversely affected.

REE plans to work with strategic partners to provide predictive maintenance scheduling through smart service and maintenance AI in combination with over-the-air updates that seek to ensure maintenance is not performed on a standard schedule, but rather before a part will fail, which is expected to offer significant savings for unnecessary part replacements and drastically reduce downtime. There is no guarantee that REE will be successful in developing the necessary technology to actualize predictive maintenance scheduling. In addition, REE servicing may primarily be carried out through third parties certified by REE. Although such potential servicing partners may have experience in servicing other products, they will initially have limited experience in servicing REE products. There can be no assurance that REE service arrangements will adequately address the service requirements of its potential customer base to their satisfaction, or that REE and its potential servicing partners will have sufficient resources to meet these service requirements in a timely manner as the volume of products REE deliver increases. In addition, if REE is unable to roll out and establish a widespread service network that complies with applicable laws, user satisfaction could be adversely affected, which in turn could materially and adversely affect REE’s reputation and thus its sales, results of operations, and prospects.

REE may be subject to risks associated with autonomous driving and EV technology, including but not limited to technical malfunctions, regulatory obstacles, and/or product liability.

REE’s products are being designed to be compatible with autonomous control. Autonomous driving technologies are subject to risks and there have been accidents and fatalities associated with such technologies. The safety of such technologies depends in part on user interaction and users, as well as other drivers on the roadways, may not be accustomed to using or adapting to such technologies. To the extent accidents associated with REE’s products that are used with autonomous controls occur, REE could be subject to liability, negative publicity, government scrutiny and further regulation. Any of the foregoing could materially and adversely affect REE’s results of operations, financial condition and growth prospects.

Autonomous driving technology is also subject to considerable regulatory uncertainty as the law evolves to catch up with the rapidly evolving nature of the technology itself, all of which are beyond REE’s control. REE’s products also may not achieve the requisite level of autonomous compatibility required for certification and rollout to consumers or satisfy changing regulatory requirements which could require REE to redesign, modify or update its products.

Risks Related to REE’s Employees

REE is dependent on its founders Daniel Barel and Ahishay Sardes.

REE is dependent on the services of Daniel Barel, its co-founder, director and Chief Executive Officer, and Ahishay Sardes, its co-founder and Chief Technology Officer. Mr. Barel and Mr. Sardes are significant influences and drivers of REE’s business plan. If Mr. Barel or Mr. Sardes were to discontinue their service to REE due to death, disability or any other reason, REE would be significantly disadvantaged.

REE’s success depends, in part, on its ability to attract and recruit key employees and hire qualified management, technical and vehicle engineering personnel.

REE’s success depends, in part, on its ability to retain its key personnel. The unexpected loss of or failure to retain one or more of its key employees could adversely affect its business. REE’s success also depends, in part, on its continuing ability to identify, hire, attract, train and develop other highly qualified personnel. Because REE’s products are based on different technology than traditional internal combustion engines, individuals with sufficient training in alternative fuel, technology or EVs may not be available, and as a result, REE will need to expend significant time and expense training the employees it hires. Competition for individuals with experience designing, manufacturing and servicing EVs or their related technology, parts and products is intense, and REE may not be able to attract, integrate, train, motivate or retain additional highly qualified personnel in the future. The failure to attract, integrate, train, motivate and retain these additional employees could materially adversely harm its business and prospects.

REE’s business may be adversely impacted by the labor and union activities of its own employees, as well of those of any of its potential affiliates, business partners, suppliers, or otherwise related entities.

Although none of REE’s employees are currently represented by a labor union, it is common throughout the automobile industry generally for many employees at automobile companies to belong to a union, which can result in higher employee costs and increased risk of work stoppages. REE may also directly and indirectly depend upon other companies with unionized work forces, such as parts suppliers and trucking and freight companies, and work stoppages or strikes organized by such unions could have a material adverse impact on REE’s business, financial condition or operating results.

Risks Related to REE’s Finances

REE is an early stage company with a history of losses, and expects to incur significant expenses and continuing losses for the foreseeable future.

Since inception, REE has incurred, and REE expects in the future while REE grows to incur, losses and negative cash flow, either or both of which may be significant. The working capital funding necessary to start a new EV product manufacturing company is significant, and other companies have tried and failed over the last several years with billions of investment capital. While REE expects to benefit from its management’s experience, the technology it has developed to date, and the advantages offered by its Engineering Center, REE does not expect to be profitable in the near term as REE invests in its business, builds capacity and ramps up operations, and REE cannot assure you that REE will ever achieve or be able to maintain profitability in the future. Failure to become profitable may materially and adversely affect the value of your investment. If REE is ever to achieve profitability, it will be dependent upon the successful development and commercial introduction and acceptance of EV products like the REEcorner, which may not occur.

Financial results may vary significantly from period to period due to fluctuations in REE’s operating costs and other factors, which may or may not be foreseeable.

REE expects its period-to-period financial results to vary based on its operating costs, which REE anticipates will fluctuate as the pace at which it continues to design, develop and produce new products and increase production capacity. Additionally, REE’s revenues from period to period may fluctuate as it develops and introduces new products or introduces existing products to new markets for the first time. As a result of these factors, REE believes that quarter-to-quarter comparisons of its financial results, especially in the short term, are not necessarily meaningful and that these comparisons cannot be relied upon as indicators of future performance. Moreover, REE’s financial results may not meet expectations of equity research analysts, ratings agencies or investors, who may be focused only on quarterly financial results. If any of this occurs, the trading price of REE Class A Ordinary Shares could fall substantially, either suddenly or over time.

REE may not be able to accurately estimate the supply and demand of its products, which could result in a variety of inefficiencies in its business and hinder its ability to generate revenue. If REE fails to accurately predict its manufacturing requirements, it could incur additional costs or experience delays.

It is difficult to predict REE’s future revenues and appropriately budget for its expenses, and REE may have limited insight into trends that may emerge and affect its business. REE expects that it will be required to provide forecasts of its demand to its potential suppliers several months prior to the scheduled delivery of products to its prospective customers. Currently, there is no historical basis for making judgments on the demand for REE’s products or its ability to develop, produce, and deliver products, or REE’s profitability in the future. If REE overestimates its requirements, its potential suppliers may have excess inventory, which indirectly would increase REE’s costs. If REE underestimates its requirements, its potential suppliers may have inadequate inventory, which could interrupt manufacturing of its products and result in delays in shipments and revenues. In addition, lead times for materials and components that REE’s potential suppliers order may vary significantly and depend on factors such as the specific supplier, contract terms and demand for each component at a given time. If REE fails 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 will 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 may need to raise additional funds and these funds may not be available to it when it needs them, or may only be available on unfavorable terms. As a result, REE may be unable to meet its future capital requirements, which could limit its ability to grow and jeopardize its ability to continue its business operations.

In the future, REE may require additional capital to respond to technological advancements, competitive dynamics or technologies, customer demands, business opportunities, challenges, acquisitions or unforeseen circumstances and it may determine to engage in equity or debt financings or enter into credit facilities for other reasons. In order to further business relationships with its potential customer base or partners, REE may issue equity or equity-linked securities to potential customers or partners. REE may not be able to timely secure additional debt or equity financing on favorable terms, or at all. If REE raises additional funds through the issuance of equity or convertible debt or other equity-linked securities or if it issues equity or equity-linked securities to potential customers to further business relationships, its existing stockholders could experience significant dilution. Any debt financing obtained by REE in the future could involve restrictive covenants relating to its capital raising activities and other financial and operational matters, which may make it more difficult for REE to obtain additional capital and to pursue business opportunities, including potential acquisitions. If REE is unable to obtain adequate financing or financing on terms satisfactory to REE, when REE requires it, REE’s ability to continue to grow or support its business and to respond to business challenges could be significantly limited. These same risks will apply to the post-combination company following the Closing of the Merger.

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

In the ordinary course of business, REE may be subject to losses resulting from products liability, accidents, acts of God and other claims against REE, for which REE may have no insurance coverage. While REE currently carries commercial general liability, workers’ compensation and directors’ and officers’ insurance policies, REE may not maintain as much insurance coverage as other EV market participants do, and in some cases, REE may not maintain any at all. Additionally, the policies that REE does have may include significant deductibles, and REE cannot be

certain that its insurance coverage will be sufficient to cover all future claims against REE. A loss that is uninsured or exceeds policy limits may require REE to pay substantial amounts, which could adversely affect REE’s financial condition and operating results.

The successful assertion of one or more large claims against REE that exceeds its available insurance coverage, or results in changes to its insurance policies (including premium increases or the imposition of large deductible or co-insurance requirements), could have an adverse effect on its business. In addition, REE cannot be sure that its existing insurance coverage will continue to be available on acceptable terms or that REE’s insurers will not deny coverage as to any future claim.

Risks Related to Being a Public Company

REE’s management has limited experience operating a public company, and thus its success in such endeavors cannot be guaranteed.

REE’s executive officers have limited experience in the management of a publicly traded company. REE’s management team may not successfully or effectively manage its transition to a public company that will be subject to significant regulatory oversight and reporting obligations under federal securities laws. Their limited experience in dealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage in that it is likely that an increasing amount of their time may be devoted to these activities which will result in less time being devoted to the management and growth of the post-combination company. REE may not have adequate personnel with the appropriate level of knowledge, experience and training in the accounting policies, practices or internal control over financial reporting required of public companies in the U.S. REE is in the process of upgrading its finance and accounting systems to an enterprise system suitable for a public company, and a delay could impact its ability or prevent it from timely reporting its operating results, timely filing required reports with the SEC and complying with Section 404 of the Sarbanes-Oxley Act. The development and implementation of the standards and controls necessary for REE to achieve the level of accounting standards required of a public company in the U.S. may require costs greater than expected. It is possible that REE will be required to expand its employee base and hire additional employees to support its operations as a public company which will increase its operating costs in future periods.

If REE is unable for any reason to meet the continued listing requirements of Nasdaq, such action or inaction could result in a delisting of the REE Class A Ordinary Shares.

If, after listing, REE fails to satisfy the continued listing requirements of Nasdaq such as the corporate governance requirements or the minimum closing bid price requirement, Nasdaq may take steps to delist the REE Class A Ordinary Shares. Such a delisting would likely have a negative effect on the price of the REE Class A Ordinary Shares and would impair your ability to sell or purchase the REE Class A Ordinary Shares when you wish to do so. In the event of a delisting, REE can provide no assurance that any action taken by it to restore compliance with listing requirements would allow its the REE Class A Ordinary Shares to become listed again, stabilize the market price or improve the liquidity of its the REE Class A Ordinary Shares, prevent its the REE Class A Ordinary Shares from dropping below the Nasdaq minimum bid price requirement or prevent future non-compliance with Nasdaq’s listing requirements.

If securities and industry analysts do not publish research or reports about REE’s business or publish negative reports about its business, REE’s share price and trading volume may suffer.

The trading market for the REE Class A Ordinary Shares will depend on the research and reports that securities or industry analysts publish about REE or its business. Currently, REE does not have any analyst coverage and may not obtain analyst coverage in the future. In the event REE obtains analyst coverage, it will not have any control over such analysts. If one or more of the analysts who cover REE downgrade REE’s shares or change their opinion of REE’s shares, REE’s share price would likely decline. If one or more of these analysts cease coverage of REE or fail to regularly publish reports on REE, REE could lose visibility in the financial markets, which could cause its share price or trading volume to decline.

As REE grows rapidly and expands into multiple global markets, there is a risk that it will fail to maintain an effective system of internal controls and its ability to produce timely and accurate financial statements or comply with applicable regulations could be adversely affected. REE may identify material weaknesses in its internal controls over financing reporting which it may not be able to remedy in a timely manner.

As a public company, REE will operate in an increasingly demanding regulatory environment, which requires it to comply with the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), the regulations of Nasdaq, the rules and regulations of the SEC, expanded disclosure requirements, accelerated reporting requirements and more complex accounting rules. Company responsibilities required by the Sarbanes-Oxley Act include establishing corporate oversight and adequate internal control over financial reporting and disclosure controls and procedures. Effective internal controls are necessary for REE to produce reliable financial reports and are important to help prevent financial fraud. Commencing with its fiscal year ending the year in which the business combination is completed, REE must perform system and process evaluation and testing of its internal controls over financial reporting to allow management to report on the effectiveness of its internal controls over financial reporting in its Form 20-F filing for that year, as required by Section 404 of the Sarbanes-Oxley Act. Prior to the Closing, REE has never been required to test its internal controls within a specified period and, as a result, it may experience difficulty in meeting these reporting requirements in a timely manner.

REE anticipates that the process of building its accounting and financial functions and infrastructure will require significant additional professional fees, internal costs and management efforts. REE expects that it will need to implement a new internal system to combine and streamline the management of its financial, accounting, human resources and other functions. However, such a system would likely require REE to complete many processes and procedures for the effective use of the system or to run its business using the system, which may result in substantial costs. Any disruptions or difficulties in implementing or using such a system could adversely affect REE’s controls and harm its business. Moreover, such disruption or difficulties could result in unanticipated costs and diversion of management’s attention. In addition, REE may discover additional weaknesses in its system of internal financial and accounting controls and procedures that could result in a material misstatement of its financial statements. REE’s internal control over financial reporting will not prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

If REE is not able to comply with the requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner, or if it is unable to maintain proper and effective internal controls, REE may not be able to produce timely and accurate financial statements. If REE cannot provide reliable financial reports or prevent fraud, its business and results of operations could be harmed, investors could lose confidence in its reported financial information and REE could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

REE will incur increased costs as a result of its operation as a public company, and its management will be required to devote substantial time and resources to employing new compliance initiatives in order to comport with the regulatory requirements applicable to public companies.

If REE completes the Merger and becomes a public company, it will incur significant legal, accounting and other expenses that it did not incur as a private company, and these expenses may increase even more after REE is no longer an emerging growth company, as defined in Section 2(a) of the Securities Act. As a public company, REE will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules adopted, and to be adopted, by the SEC and Nasdaq. REE’s management and other personnel will need to devote a substantial amount of time to these compliance initiatives. Moreover, REE expects these rules and regulations to substantially increase its legal and financial compliance costs and to make some activities more time-consuming and costly. The increased costs will increase REE’s net loss. For example, REE expects these rules and regulations to make it more difficult and more expensive for it to obtain director and officer liability insurance and it may be forced to accept reduced policy limits or incur substantially higher costs to maintain the same or similar coverage. REE cannot predict or estimate the amount or timing of additional costs it may incur to respond to these requirements. The impact of these requirements could also make it more difficult for REE to attract and retain qualified persons to serve on its board of directors, its board committees or as executive officers.

REE will be a foreign private issuer and, as a result, it will not be subject to U.S. proxy rules and will be subject to Exchange Act reporting obligations that, to some extent, are more lenient and less frequent than those of a U.S. domestic public company.

Upon the closing of the Merger, REE will report under the Exchange Act as a non-U.S. company with foreign private issuer status. Because REE qualifies as a foreign private issuer under the Exchange Act, it is exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including (1) the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act, (2) the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time and (3) the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, although it is subject to Israeli laws and regulations with regard to certain of these matters and intends to furnish comparable quarterly information on Form 6-K. In addition, foreign private issuers are not required to file their annual report on Form 20-F until 120 days after the end of each fiscal year, while U.S. domestic issuers that are accelerated filers are required to file their annual report on Form 10-K within 75 days after the end of each fiscal year and U.S. domestic issuers that are large accelerated filers are required to file their annual report on Form 10-K within 60 days after the end of each fiscal year. Foreign private issuers are also exempt from Regulation FD, which is intended to prevent issuers from making selective disclosures of material information. As a result of all of the above, you may not have the same protections afforded to shareholders of a company that is not a foreign private issuer.

As REE is a “foreign private issuer” and intends to follow certain home country corporate governance practices, its shareholders may not have the same protections afforded to shareholders of companies that are subject to all Nasdaq corporate governance requirements.

As a foreign private issuer, REE is permitted to follow certain home country corporate governance practices rather than those otherwise required by Nasdaq rules, provided that it discloses the requirements it is not following and describes the equivalent home country practices it follows instead. REE intends to rely on this “foreign private issuer exemption” with respect to the Nasdaq rules for director nomination procedures and shareholder meeting quorums. REE may in the future elect to follow home country practices with regard to other matters. As a result, its shareholders will not have the same protections afforded to shareholders of companies that are subject to all Nasdaq corporate governance requirements.

REE may lose its foreign private issuer status in the future, which could result in significant additional costs and expenses.

As discussed above, REE is a foreign private issuer, and therefore is not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to REE on June 30, 2021. In the future, REE would lose its foreign private issuer status if (1) more than 50% of its outstanding voting securities are owned by U.S. residents and (2) a majority of its directors or executive officers are U.S. citizens or residents, or it fails to meet additional requirements necessary to avoid loss of foreign private issuer status. If REE loses its foreign private issuer status, it will be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms, which are more detailed and extensive than the forms available to a foreign private issuer. REE would also have to mandatorily comply with U.S. federal proxy requirements, and its officers, directors and principal shareholders will become subject to the short-swing profit disclosure and recovery provisions of Section 16 of the Exchange Act. In addition, it would lose its ability to rely upon exemptions from certain corporate governance requirements under the listing rules of Nasdaq. As a U.S. listed public company that is not a foreign private issuer, REE would incur significant additional legal, accounting and other expenses that it will not incur as a foreign private issuer.

Risks Related to Regulation

REE’s financial and operational projections rely in part on existing and future regulations and incentive programs supporting EV adoption.

There has been a significant growth in the adoption of environmentally driven regulations and incentive programs with low and zero emission targets with the automotive industry being among the most impacted industries. Such measures encourage local and national governments to implement various forms of rebates and credits for the purchase of an EV. In addition, regulations in many cities, states and countries are also encouraging a shift away from — or in some cases banning entirely — fossil fuel-powered vehicles, with many of the earliest of these regulations targeted at buses, trucks and delivery vehicles. REE’s financial and operational projections include the continued growth in existing and similar regulations and incentive programs to accelerate the adoption of EV technology into the wider market. There is no guarantee that such regulations and incentive programs will be successful in encouraging adoption of EV technology and there is no guarantee that new regulations and incentive programs will be adopted or that existing regulations and incentive programs will remain in place. For example, the development of an alternative fuel besides electricity that results in low or no emissions may shift the focus of such regulations and incentive programs away from EV technology. The failure for new regulations and incentive programs to be adopted as expected or the termination of existing regulations and incentive programs could materially and adversely affect the growth of the EV market generally and REE’s business, prospects, financial condition and operating results.

REE may encounter obstacles outside of its control that slow the adoption of EVs in the market, including but not limited to regulatory requirements or infrastructure limitations.

While REE’s products are subject to substantial regulation under federal, state and local laws, REE believes that its products will be in compliance with all applicable laws when they are offered to potential customers. However, to the extent the laws change, new laws are introduced, or if REE introduces new products in the future, some or all of its products may not comply with applicable international federal, state or local laws. Further, certain federal, state and local laws and industry standards currently regulate electrical and electronics equipment. Although standards for EVs are not yet generally available or accepted as industry standards, REE’s products may become subject to international, federal, state, and local regulation in the future. Compliance with these regulations could be burdensome, time consuming, and expensive.

REE’s products are subject to environmental and safety compliance with various federal and state regulations, including regulations promulgated by the Environmental Protection Agency, the National Highway Traffic and Safety Administration and various state boards, and compliance certification is required for each new model year. The cost of these compliance activities and the delays and risks associated with obtaining approval can be substantial. The risks, delays and expenses incurred in connection with such compliance could be substantial.

In addition, REE’s products involve a novel design and new technology, including locating critical vehicle components (steering, braking, suspension, powertrain and control) into the area between the chassis and the wheel and X-by-Wire Control technology, which may not meet existing safety standards or require modification in order to comply with various regulatory requirements. In particular, while there is limited related regulation in the EU, REE’s X-by-Wire technology has not received significant regulatory attention globally (including in the U.S.). There is no guarantee that REE’s X-by-Wire technology will receive regulatory approval generally, and there is no guarantee that REE’s X-by-Wire Control technology will comply with any relevant regulation that is put in place in the future. Compliance with regulatory requirements is expensive, at times requiring the replacement, enhancement or modification of equipment, facilities or operations. There can be no assurance that REE will be able to maintain its profitability by offsetting any increased costs of complying with future regulatory requirements.

REE is subject to various environmental laws and regulations that could impose substantial costs on its business and cause delays in building its manufacturing facilities.

REE’s operations are and will be subject to international, federal, state and local environmental laws and regulations, including laws relating to the use, handling, storage, disposal of and human exposure to hazardous materials. Environmental and health and safety laws and regulations can be complex, and REE has limited experience complying with them. Moreover, REE expects that it will be affected by future amendments to such laws or other new environmental and health and safety laws and regulations which may require REE to change its operations, potentially resulting in a

material adverse effect on its business, prospects, financial condition and operating results. These laws can give rise to liability for administrative oversight costs, cleanup costs, property damage, bodily injury, fines and penalties. Capital and operating expenses needed to comply with environmental laws and regulations can be significant, and violations may result in substantial fines and penalties, third-party damages, suspension of production or a cessation of REE’s operations.

Contamination at properties REE will own or operate, REE formerly owned or operated or to which hazardous substances were sent by REE, may result in liability for REE under environmental laws and regulations, including, but not limited to, the Comprehensive Environmental Response, Compensation and Liability Act, which can impose liability for the full amount of remediation-related costs without regard to fault, for the investigation and cleanup of contaminated soil and ground water, for building contamination and impacts to human health and for damages to natural resources. The costs of complying with environmental laws and regulations and any claims concerning noncompliance, or liability with respect to contamination in the future, could have a material adverse effect on REE’s financial condition or operating results.

REE and its potential suppliers and strategic partners are or may be subject to substantial regulation and unfavorable changes to, or failure by REE or its potential suppliers and strategic partners to comply with any such regulations could substantially harm REE’s business and operating results.

REE’s products, and the sale of motor vehicles including EVs in general, are subject to substantial regulation under international, federal, state, and local laws. REE expects to incur significant costs in complying with these regulations. Regulations related to the EV industry and alternative energy are currently evolving and REE faces risks associated with changes to these regulations.

To the extent the laws change, REE’s products may not comply with applicable international, federal, state or local laws, which would have an adverse effect on its business. Compliance with changing regulations could be burdensome, time consuming, and expensive. To the extent compliance with new regulations is cost prohibitive, REE’s business, prospects, financial condition and operating results would be adversely affected.

Internationally, there may be laws in jurisdictions REE has not yet entered or laws it is unaware of in jurisdictions it has entered that may restrict its sales or other business practices. Even for those jurisdictions REE has analyzed, the laws in this area can be complex, difficult to interpret and may change over time. Continued regulatory limitations and other obstacles interfering with REE’s ability to sell products could have a negative and material impact on its business, prospects, financial condition and results of operations.

The evolution of the regulatory framework for autonomous vehicles and their related components is outside of REE’s control and it cannot guarantee that its products will achieve the requisite level of autonomy to enable driverless systems within the current projected framework, if at all.

There are currently no federal U.S. regulations pertaining to the safety of self-driving vehicles; however, the National Highway Traffic and Safety Administration has established recommended guidelines. Certain states have legal restrictions on self-driving vehicles, and many other states are considering them. This patchwork increases the difficulty in legal compliance for EVs and their related technology, parts and components. In Europe, certain vehicle safety regulations apply to self-driving braking and steering systems, and certain treaties also restrict the legality of certain higher levels of self-driving vehicles. Self-driving laws and regulations are expected to continue to evolve in numerous jurisdictions in the U.S. and foreign countries and may restrict autonomous driving features that REE may deploy.

REE is subject to governmental export and import control laws and regulations. Any failure on behalf of REE to comply with these laws and regulations could have an adverse effect on its business, prospects, financial condition and operating results.

In recent years, both China and the United States have each imposed tariffs indicating the potential for further trade barriers. These tariffs may escalate a nascent trade war between China and the United States. Tariffs could potentially impact its raw material prices and impact any plans to sell REE’s products or EVs that would use REE’s products in China. In addition, these developments could have a material adverse effect on global economic conditions and the stability of global financial markets. Any of these factors could have a material adverse effect on REE’s business, financial condition and results of operations.

The UK’s withdrawal from the European Union (commonly referred to as Brexit), could result in increased regulatory, economic and political uncertainty, and impose additional challenges to REE in securing regulatory approval of its products or EVs using REE’s product in the European Union and the rest of Europe.

In June 2016, voters in the UK approved a referendum to withdraw the UK’s membership from the European Union (“EU”), which is commonly referred to as “Brexit.” The UK’s withdrawal from the EU occurred on January 31, 2020, but the UK remained in the EU’s customs union and single market for a transition period that expired on December 31, 2020. On December 24, 2020, the UK and the EU entered into a trade and cooperation agreement (the “Trade and Cooperation Agreement”), which was applied on a provisional basis from January 1, 2021. While the economic integration does not reach the level that existed during the time the UK was a member state of the EU, the Trade and Cooperation Agreement sets out preferential arrangements in areas such as trade in goods and in services, digital trade and intellectual property. Negotiations between the UK and the EU are expected to continue in relation to the relationship between the UK and the EU in certain other areas which are not covered by the Trade and Cooperation Agreement. The long term effects of Brexit will depend on the effects of the implementation and application of the Trade and Cooperation Agreement and any other relevant agreements between the UK and the EU. REE has facilities and employees in both the UK and other European countries, including the Engineering Center. REE cannot predict whether or not the UK will significantly alter its current laws and regulations in respect of the EV industry and, if so, what impact any such alteration would have on REE or its business. Moreover, REE cannot predict the impact that Brexit will have on (i) the marketing of its products or (ii) the process to obtain regulatory approval in the UK for its products. As a result of Brexit, REE may experience adverse impacts on customer demand and profitability in the UK and other markets. Depending on the terms of Brexit and any subsequent trade agreement, the UK could also lose access to the single EU market, or specific countries in the EU, resulting in a negative impact on the general and economic conditions in the UK and the EU. Changes may occur in regulations that REE is required to comply with as well as amendments to treaties governing tax, duties, tariffs, etc. which could adversely impact its operations and require it to modify its financial and supply arrangements. For example, the imposition of any import restrictions and duties levied on REE’s products may make its products more expensive and less competitive from a pricing perspective. To avoid such impacts, REE may have to restructure or relocate some of its operations which would be costly and negatively impact its profitability and cash flow.

Additionally, political instability in the European Union as a result of Brexit may result in a material negative effect on credit markets, currency exchange rates and foreign direct investments and any subsequent trade agreement in the EU and UK. This deterioration in economic conditions could result in increased unemployment rates, increased short- and long-term interest rates, adverse movements in exchange rates, consumer and commercial bankruptcy filings, a decline in the strength of national and local economies, and other results that negatively impact household incomes.

Furthermore, as a result of Brexit, other European countries may seek to conduct referenda with respect to their continuing membership with the European Union. Given these possibilities and others REE may not anticipate, as well as the absence of comparable precedent, it is unclear what financial, regulatory and legal implications the withdrawal of the UK from the European Union would have and how such withdrawal would affect REE, and the full extent to which its business could be adversely affected.

REE may become involved in legal and regulatory proceedings and commercial or contractual disputes, which could have an adverse effect on its profitability and consolidated financial position.

REE may be, from time to time, involved in litigation, regulatory proceedings and commercial or contractual disputes that may be significant. These matters may include, without limitation, disputes with REE’s potential suppliers and strategic partners and its potential customers base, intellectual property claims, stockholder litigation, government investigations, class action lawsuits, personal injury claims, environmental issues, customs and VAT disputes and employment and tax issues. In addition, REE could face in the future a variety of labor and employment claims against it, which could include but is not limited to general discrimination, wage and hour, privacy, ERISA or disability claims. In such matters, government agencies or private parties may seek to recover from REE very large, indeterminate amounts in penalties or monetary damages (including, in some cases, treble or punitive damages) or seek to limit REE’s operations in some way. These types of lawsuits could require significant management time and attention or could involve substantial legal liability, adverse regulatory outcomes, and/or substantial expenses to defend. Often these cases raise complex factual and legal issues and create risks and uncertainties. No assurances can be given that any proceedings and claims will not have a material adverse impact on REE’s operating results and consolidated financial position or that its established reserves or its available insurance will mitigate this impact.

REE is subject to U.S. and foreign anti-corruption and anti-money laundering laws and regulations. As a result, REE may face criminal liability and other serious consequences for violations of such laws, which could harm its business.

REE is or will be subject to anti-corruption, anti-bribery, anti-money laundering, financial and economic sanctions and similar laws and regulations in various jurisdictions in which it conducts or in the future may conduct activities, including the U.S. Foreign Corrupt Practices Act (“FCPA”), the U.K. Bribery Act 2010, and other anti-corruption laws and regulations. The FCPA and the U.K. Bribery Act 2010 prohibit REE and its officers, directors, employees and business partners acting on its behalf, including agents, from corruptly offering, promising, authorizing or providing anything of value to a “foreign official” for the purposes of influencing official decisions or obtaining or retaining business or otherwise obtaining favorable treatment. The FCPA also requires companies to make and keep books, records and accounts that accurately reflect transactions and dispositions of assets and to maintain a system of adequate internal accounting controls. The U.K. Bribery Act also prohibits non-governmental “commercial” bribery and soliciting or accepting bribes. A violation of these laws or regulations could adversely affect REE’s business, results of operations, financial condition and reputation. REE’s policies and procedures designed to ensure compliance with these regulations may not be sufficient and its directors, officers, employees, representatives, consultants, agents, and business partners could engage in improper conduct for which it may be held responsible.

Non-compliance with anti-corruption, anti-bribery, anti-money laundering or financial and economic sanctions laws could subject REE to whistleblower complaints, adverse media coverage, investigations, and severe administrative, civil and criminal sanctions, collateral consequences, remedial measures and legal expenses, all of which could materially and adversely affect REE’s business, results of operations, financial condition and reputation. In addition, changes in economic sanctions laws in the future could adversely impact REE’s business and investments in its shares.

The intended tax effects of REE’s corporate structure and intercompany arrangements depend on the application of the tax laws of various jurisdictions and on how REE operates its business.

REE is incorporated in and a tax resident in Israel. REE currently has subsidiaries in the UK, Germany, and the U.S. If REE succeeds in growing its business, REE expects to conduct increased operations through its subsidiaries in various countries and tax jurisdictions, in part through intercompany service agreements between REE and its subsidiaries. In that case, REE’s corporate structure and intercompany transactions, including the manner in which REE develops and uses its intellectual property, will be organized so that REE can achieve its business objectives in a tax-efficient manner and in compliance with applicable transfer pricing rules and regulations. If two or more affiliated companies are located in different countries or tax jurisdictions, the tax laws and regulations of each country generally will require that transfer prices be the same as those between unrelated companies dealing at arm’s length and that appropriate documentation be maintained to support the transfer prices. While REE believes that it operates in compliance with applicable transfer pricing laws and intends to continue to do so, its transfer pricing procedures are not binding on applicable taxing authorities.

Significant judgment is required in evaluating REE’s tax positions and determining its provision for income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. For example, REE’s effective tax rates could be adversely affected by changes in foreign currency exchange rates or by changes in the relevant tax, accounting and other laws, regulations, principles and interpretations. In addition, its effective tax rate and the availability of any tax holidays could be adversely affected if REE does not obtain favorable tax rulings from certain taxing authorities. As REE intends to operate in various countries and taxing jurisdictions, the application of tax laws can be subject to diverging and sometimes conflicting interpretations by taxing authorities of these jurisdictions. It is not uncommon for taxing authorities in different countries to have conflicting views, for instance, with respect to, among other things, the manner in which the arm’s length standard is applied for transfer pricing purposes, or with respect to the valuation of intellectual property.

In addition, tax laws are dynamic and subject to change as new laws are passed and new interpretations of the law are issued or applied. REE continues to assess the impact of such changes in tax laws and interpretations on its business and may determine that changes to its structure, practice, tax positions or the manner in which it conducts its business are necessary in light of such changes and developments in the tax laws of the jurisdictions in which REE operates. Such changes may nevertheless be ineffective in avoiding an increase in its consolidated tax liability, which could adversely affect its financial condition, results of operations and cash flows.

If taxing authorities in any of these countries were to successfully challenge REE’s transfer prices as not reflecting arm’s length transactions, they could require REE to adjust its transfer prices and thereby reallocate its income to reflect these revised transfer prices, which could result in a higher tax liability to REE. In addition, if the country from which the income is reallocated does not agree with the reallocation, both countries could tax the same income, potentially resulting in double taxation. If taxing authorities were to allocate income to a higher tax jurisdiction, subject REE’s income to double taxation or assess interest and penalties, it would increase REE’s consolidated tax liability, which could adversely affect its financial condition, results of operations and cash flows.

Risks Related to REE’s Information Security

In order to enter into production of its products, REE must develop complex software and technology systems in coordination with its potential suppliers and strategic partners. REE can provide no guarantee that such systems will be successfully developed.

REE’s products will use a substantial amount of third-party and in-house software codes and complex hardware to operate. The development of such advanced technologies are inherently complex, and REE will need to coordinate with its potential suppliers and strategic partners in order to reach production for its products. Defects and errors may be revealed over time and REE’s control over the performance of third-party services and systems may be limited. Thus, REE’s potential inability to develop the necessary software and technology systems may harm its competitive position.

REE is relying on potential suppliers and strategic partners to develop a number of emerging technologies for use in its products, including lithium ion battery technology. These technologies are not today, and may not ever be, commercially viable. There can be no assurances that REE’s potential suppliers and strategic partners will be able to meet the technological requirements, production timing, and volume requirements to support its business plan. In addition, the technology may not comply with the cost, performance useful life and warranty characteristics REE anticipates in its business plan. As a result, REE’s business plan could be significantly impacted and REE may incur significant liabilities under warranty claims which could adversely affect its business, prospects, and results of operations.

REE is subject to stringent and changing privacy laws, regulations and standards, information security policies and contractual obligations related to data privacy and security. REE’s actual or perceived failure to comply with such obligations could harm its business. Such legal requirements are evolving, uncertain and may require improvements in, or changes to, REE’s policies and operations.

REE expects to face significant challenges with respect to information security and privacy, including the storage, transmission and sharing of confidential information. REE will transmit and store confidential and private information of its customers, such as personal information, including names, accounts, user IDs and passwords, and payment or transaction related information.

REE has adopted strict information security policies and deployed advanced measures to implement the policies, including, among others, advanced encryption technologies, and plans to continue to deploy additional measurers as REE grows. However, advances in technology, an increased level of sophistication and diversity of REE’s products and services, an increased level of expertise of hackers, new discoveries in the field of cryptography or others can still result in a compromise or breach of the measures that it uses. If REE is unable to protect its systems, and hence the information stored in its systems, from unauthorized access, use, disclosure, disruption, modification or destruction, such problems or security breaches could cause a loss, give rise to REE’s liabilities to the owners of confidential information or even subject it to fines and penalties. In addition, complying with various laws and regulations could cause REE to incur substantial costs or require it to change its business practices, including its data practices, in a manner adverse to REE’s business.

In addition, REE will need to comply with increasingly complex and rigorous regulatory standards enacted to protect business and personal data in the U.S., Europe and elsewhere. For example, the European Union adopted the General Data Protection Regulation (“GDPR”), which became effective on May 25, 2018 and the State of California adopted the California Consumer Privacy Act of 2018 (“CCPA”), which became effective in January 2020. Both the GDPR and the CCPA impose additional obligations on companies regarding the handling of personal data and provides certain individual privacy rights to persons whose data is stored. Compliance with existing, proposed and recently enacted laws (including implementation of the privacy and process enhancements called for under the GDPR) and regulations can be costly; any failure to comply with these regulatory standards could subject REE to legal and reputational risks.

Compliance with any additional laws and regulations could be expensive, and may place restrictions on the conduct of REE’s business and the manner in which it interacts with its customers. Any failure to comply with applicable regulations could also result in regulatory enforcement actions against REE, and misuse of or failure to secure personal information could also result in violation of data privacy laws and regulations, proceedings against REE by governmental entities or others, and damage to its reputation and credibility, and could have a negative impact on revenues and profits.

Significant capital and other resources may be required to protect against information security breaches or to alleviate problems caused by such breaches or to comply with REE’s privacy policies or privacy-related legal obligations. The resources required may increase over time as the methods used by hackers and others engaged in online criminal activities are increasingly sophisticated and constantly evolving. Any failure or perceived failure by REE to prevent information security breaches or to comply with privacy policies or privacy-related legal obligations, or any compromise of security that results in the unauthorized release or transfer of personally identifiable information or other customer data, could cause REE’s potential customer base to lose trust in REE and could expose REE to legal claims. Any perception by the public that online transactions or the privacy of user information are becoming increasingly unsafe or vulnerable to attacks could inhibit the growth of online retail and other online services generally, which may reduce the number of orders REE receives.

The global data protection landscape is rapidly evolving, and implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future. REE may not be able to monitor and react to all developments in a timely manner. For example, California recently adopted the CCPA, which became effective in January 2020. The CCPA establishes a privacy framework for covered businesses, including an expansive definition of personal information and data privacy rights for California residents. The CCPA includes a framework with potentially severe statutory damages and private rights of action. The CCPA requires covered businesses to provide new disclosures to California residents, provide them new ways to opt-out of certain disclosures of personal information, and allow for a new cause of action for data breaches. As REE expands its operations, the CCPA may increase REE’s compliance costs and potential liability. Some observers have noted that the CCPA could mark the beginning of a trend toward more stringent privacy legislation in the United States. Other states have begun to propose similar laws. Compliance with any applicable privacy and data security laws and regulations is a rigorous and time-intensive process, and REE may be required to put in place additional mechanisms to comply with such laws and regulations.

REE publishes privacy policies and other documentation regarding its collection, processing, use and disclosure of personal information and/or other confidential information. Although REE endeavors to comply with its published policies and other documentation, REE may at times fail to do so or may be perceived to have failed to do so. Moreover, despite its efforts, REE may not be successful in achieving compliance if REE’s employees, contractors, service providers or vendors fail to comply with its published policies and documentation. Such failures can subject REE to potential local, state and federal action if they are found to be deceptive, unfair, or misrepresentative of its actual practices. Claims that REE has violated individuals’ privacy rights or failed to comply with data protection laws or applicable privacy notices even if REE is not found liable, could be expensive and time-consuming to defend and could result in adverse publicity that could harm its business.

REE is subject to cybersecurity risks to its various systems and software and any material failure, weakness, interruption, cyber event, incident or breach of security could prevent REE from effectively operating its business, or may cause harm to its business that may or may not be reparable.

REE is at risk for interruptions, outages and breaches of its: (a) operational systems, including business, financial, accounting, product development, data processing or production processes, owned by REE or its potential suppliers and strategic partners; (b) facility security systems, owned by REE or its potential suppliers and strategic partners; (c) transmission control modules or other in-product technology, owned by REE or its potential suppliers and strategic partners; (d) the integrated software in REE’s products; or (e) customer data that REE processes or its potential suppliers and strategic partners process on its behalf. Such incidents could: materially disrupt REE’s operational systems; result in loss of intellectual property, trade secrets or other proprietary or competitively sensitive information; compromise certain information of employees, potential customers, potential suppliers and strategic partners, or others; jeopardize the security of REE’s facilities; or affect the performance of in-product technology and the integrated software in REE’s products.

REE plans to include in-vehicle services and functionality that utilize data connectivity to monitor performance and timely capture opportunities to enhance on-the-road performance and for safety and cost-saving preventative maintenance. The availability and effectiveness of REE’s services depend on the continued operation of information technology and communications systems. REE’s systems will be vulnerable to damage or interruption from, among others, physical theft, fire, terrorist attacks, natural disasters, power loss, war, telecommunications failures, viruses, denial or degradation of service attacks, ransomware, social engineering schemes, insider theft or misuse or other attempts to harm REE’s systems. REE intends to use its in-vehicle services and functionality to log information about each vehicle’s use in order to aid REE in vehicle diagnostics and servicing. REE’s potential customer base may object to the use of this data, which may increase REE’s vehicle maintenance costs and harm its business prospects.

Moreover, there are inherent risks associated with developing, improving, expanding and updating REE’s current systems, such as the disruption of REE’s data management, procurement, production execution, finance, supply chain and sales and service processes. These risks may affect REE’s ability to manage its data and inventory, procure parts or supplies or assemble, deploy, deliver and service its products, adequately protect its intellectual property or achieve and maintain compliance with, or realize available benefits under, applicable laws, regulations and contracts. REE cannot be sure that these systems upon which it relies, including those of its potential suppliers and strategic partners, will be effectively implemented, maintained or expanded as planned. If REE does not successfully implement, maintain or expand these systems as planned, its operations may be disrupted, its ability to accurately and timely report its financial results could be impaired, and deficiencies may arise in its internal control over financial reporting, which may impact REE’s ability to certify its financial results. Moreover, REE’s proprietary information or intellectual property could be compromised or misappropriated and its reputation may be adversely affected. If these systems do not operate as REE expects them to, REE may be required to expend significant resources to make corrections or find alternative sources for performing these functions.

Any unauthorized control or manipulation of the information technology systems in REE’s products could result in loss of confidence in REE and its products and harm REE’s business.

REE’s products will contain complex information technology systems. For example, REE’s products will be outfitted with built-in data connectivity to accept and install periodic remote updates from REE to improve or update the functionality of its products. REE has designed, implemented and tested security measures intended to prevent cybersecurity breaches or unauthorized access to its information technology networks, its products and their systems, and intends to implement additional security measures as necessary. However, hackers may attempt in the future, to gain unauthorized access to modify, alter and use such networks, products and systems to gain control of, or to change, REE’s products’ functionality, user interface and performance characteristics, or to gain access to data stored in or generated by the products. Vulnerabilities could be identified in the future and REE’s remediation efforts may not be successful. Any unauthorized access to or control of REE’s products or their systems or any loss of data could result in legal claims or proceedings. In addition, regardless of their veracity, reports of unauthorized access to REE’s products, their systems or data, as well as other factors that may result in the perception that REE’s products, their systems or data are capable of being “hacked,” could negatively affect REE’s brand and harm its business, prospects, financial condition and operating results.

REE intends to retain certain personal information about its products, customers, employees and others that, if compromised, could have a material, adverse impact on REE’s financial performance and results of operations or prospects.

REE plans to collect, store, transmit and otherwise process data from products, customers, employees and others as part of its business and operations, which may include personal data or confidential or proprietary information. REE also works with potential suppliers and strategic partners that collect, store and process such data on its behalf and in connection with its products. There can be no assurance that any security measures that REE or its potential suppliers and strategic partners have implemented will be effective against current or future security threats. If a compromise of data were to occur, REE may become liable under its contracts with other parties and under applicable law for damages and incur penalties and other costs to respond to, investigate and remedy such an incident. REE’s systems, networks and physical facilities could be breached or personal information could otherwise be compromised due to employee error or malfeasance, if, for example, third parties attempt to fraudulently induce REE’s employees or REE’s customers to disclose information or user names and/or passwords. Third parties may also exploit vulnerabilities in, or obtain unauthorized access to, products, systems, networks and/or physical facilities utilized by REE’s service providers and vendors.

Risks Related to REE’s Intellectual Property

REE may incur significant costs and expenses in connection with the protection and enforcement of its intellectual property rights, including but not limited to litigation costs.

REE may not be able to prevent others from unauthorized use of its intellectual property, which could harm its business and competitive position. REE relies on a combination of patents, trade secrets (including know-how), employee and third-party nondisclosure agreements, copyrights, trademarks, intellectual property licenses, and other contractual rights to establish and protect its rights in its technology. Despite REE’s efforts to protect its proprietary rights, third parties may attempt to copy or otherwise obtain and use REE’s intellectual property or seek court declarations that they do not infringe upon its intellectual property rights. Monitoring unauthorized use of REE’s intellectual property is difficult and costly, and the steps REE has taken or will take will prevent misappropriation. From time to time, REE may have to resort to litigation to enforce its intellectual property rights, which could result in substantial costs and diversion of its resources.

The protection of REE’s intellectual property rights will be important to its future business opportunities. However, the measures REE takes to protect its intellectual property from unauthorized use by others may not be effective for various reasons, including the following:

•        as noted below, any patent applications REE submits may not result in the issuance of patents (and patents have not yet issued to REE based on its pending applications);

•        the scope of REE’s patents that may subsequently issue may not be broad enough to protect its proprietary rights;

•        REE’s issued patents may be challenged or invalidated by third parties;

•        REE’s employees or business partners may breach their confidentiality, non-disclosure and non-use obligations to REE;

•        third parties may independently develop technologies that are the same or similar to REE’s;

•        the costs associated with enforcing patents, confidentiality and invention agreements or other intellectual property rights may make enforcement impracticable; and

•        current and future competitors may circumvent or otherwise design around REE’s patents.

Patent, trademark, and trade secret laws vary significantly throughout the world. A number of foreign countries do not protect intellectual property rights to the same extent as do the laws of the U.S. Therefore, REE’s intellectual property rights may not be as strong or as easily enforced outside of the U.S. Failure to adequately protect REE’s intellectual property rights could result in its competitors offering similar products, potentially resulting in the loss of some of REE’s competitive advantage and a decrease in its revenue which, would adversely affect its business, prospects, financial condition and operating results.

Failure to adequately protect REE’s intellectual property rights could result in REE’s competitors offering similar products, potentially resulting in the loss of some of REE’s competitive advantage and a decrease in its revenue, which could adversely affect REE’s business, prospects, financial condition and operating results.

Also, while REE has registered and applied for trademarks in an effort to protect its investment in its brand and goodwill with customers, competitors may challenge the validity of those trademarks and other brand names in which REE has invested. Such challenges can be expensive and may adversely affect REE’s ability to maintain the goodwill gained in connection with a particular trademark.

REE may be sued for infringing or misappropriating intellectual property rights of third parties, and any such litigation would be both costly and time consuming and could prevent REE from developing or commercializing its future products.

Companies, organizations, or individuals, including REE’s competitors, may hold or obtain patents, trademarks or other proprietary rights that would prevent, limit or interfere with REE’s ability to make, use, develop, sell, lease or market its products which could make it more difficult for REE to operate its business. From time to time, REE may

receive communications from holders of patents or trademarks regarding their proprietary rights. Companies holding patents or other intellectual property rights may bring suits alleging infringement of such rights or otherwise assert their rights and urge REE to take licenses. REE’s applications and uses of trademarks relating to its design, software or artificial intelligence technologies could be found to infringe upon existing trademark ownership and rights. In addition, if REE is determined to have infringed upon a third party’s intellectual property rights, it may be required to do one or more of the following:

•        cease selling or leasing, incorporating certain components into, or using products or offering goods or services that incorporate or use the challenged intellectual property;

•        pay substantial damages;

•        seek a license from the holder of the infringed intellectual property right, which license may not be available on reasonable terms, or at all;

•        redesign its products or other goods or services; or

•        establish and maintain alternative branding for its products and services.

In the event of a successful claim of infringement against REE and REE’s failure or inability to obtain a license to the infringed technology or other intellectual property right, REE’s business, prospects, operating results and financial condition could be materially and adversely affected. In addition, any litigation or claims, whether or not valid, could result in substantial costs, negative publicity and diversion of resources and management attention.

Patent applications submitted by REE to the relevant authorities may not result in granted patents or may require modification in order to obtain approval.

REE cannot be certain that it is the first inventor of the subject matter to which it has filed a particular patent application, or if it is the first party to file such a patent application. If another party has filed a patent application for the same subject matter as REE has, REE may not be entitled to the protection sought by the patent application. Further, the scope of protection of issued patent claims is often difficult to determine. As a result, REE cannot be certain that the patent applications that it files will issue, or that its issued patents will afford protection against competitors with similar technology. In addition, REE’s competitors may design around REE’s issued patents, which may adversely affect its business, prospects, financial condition or operating results.

REE cannot assure you that it will be granted patents pursuant to its pending applications. Even if REE’s patent applications succeed and it is issued patents in accordance with them, it is still uncertain whether these patents will be contested, circumvented or invalidated in the future. In addition, the rights granted under any issued patents may not provide REE with meaningful protection or competitive advantages. The claims under any patents that issue from REE’s patent applications may not be broad enough to prevent others from developing technologies that are similar or that achieve results similar to REE’s. The intellectual property rights of others could also bar REE from licensing and exploiting any patents that issue from its pending applications. Numerous patents and pending patent applications owned by others exist in the fields in which REE has developed and are developing its technology. These patents and patent applications might have priority over REE’s patent applications and could subject its patent applications to invalidation. Finally, in addition to those who may claim priority, any of REE’s existing or pending patents may also be challenged by others on the basis that they are otherwise invalid or unenforceable.

REE may be subject to damages resulting from claims that either it or any of its employees wrongfully used or disclosed alleged trade secrets of their employees’ former employers or that they allegedly violated certain covenants, such as non-compete agreements, to which REE or its employees may have been previously or currently bound.

Many of REE’s employees were previously employed by other automotive companies or by suppliers to automotive companies. REE may be subject to claims that it or these employees have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of their former employers. Litigation may be necessary to defend against these claims. If REE fails in defending such claims, in addition to paying monetary damages, it may lose valuable intellectual property rights or personnel. A loss of key personnel or their work product could hamper or prevent REE’s ability to commercialize its products, which could severely harm its business. Even if REE is successful in defending against these claims, litigation could result in substantial costs and demand on management resources.

•        Know-How transfer limitation

•        The Innovation Law restricts the ability to transfer know-how funded by the IIA outside of Israel. Transfer of IIA funded know-how outside of Israel requires prior approval of the IIA and may be subject to payments to the IIA, calculated according to formulae provided under the Innovation Law. If REE wishes to transfer IIA funded know-how, the terms for approval will be determined according to the nature of the transaction and the consideration paid to REE in connection with such transfer.

•        Approval of transfer of IIA funded know-how to another Israeli company may be granted only if the recipient abides by the provisions of the Innovation Law and related regulations, including the restrictions on the transfer of know-how and manufacturing rights outside of Israel.

•        Change of Control.    Any non-Israeli citizen, resident or entity that, among other things, (i) becomes a holder of 5% or more of REE’s share capital or voting rights, (ii) is entitled to appoint one or more of REE’s directors or our chief executive officer or (iii) serves as one of REE’s directors or as its chief executive officer (including holders of 25% or more of the voting power, equity or the right to nominate directors in such direct holder, if applicable) is required to notify the IIA and undertake to comply with the rules and regulations applicable to the grant programs of the IIA, including the restrictions on transfer described above.

Approval to manufacture products outside of Israel or consent to the transfer of IIA funded know-how, if requested, is within the discretion of the IIA. Furthermore, the IIA may impose certain conditions on any arrangement under which it permits us to transfer IIA funded know-how or manufacturing out of Israel.

The consideration available to REE’s shareholders in a future transaction involving the transfer outside of Israel of know-how developed with IIA funding (such as a merger or similar transaction) may be reduced by any amounts that REE is required to pay to the IIA.

Risks Related to REE’s Dual Class Structure

The dual class structure of REE Ordinary Shares will have the effect of concentrating voting power with REE’s founders, who serve as its Chief Executive Officer and Chief Technology Officer, which will limit an investor’s ability to influence the outcome of important transactions, including a change in control.

REE Class B Ordinary Shares will have 10 votes per share, while shares of REE Class A Ordinary Shares will have one vote per share. Upon the consummation of the Merger, its Founders, Daniel Barel and Ahishay Sardes, will hold all REE Class B Ordinary Shares granting them each up to approximately 39% of voting power and together up to approximately 78% of the voting power of REE following the Merger (under the No Redemption Scenario). As a result, if they act together, they will be able to control matters submitted to REE’s shareholders for approval, including the election of directors, amendments of its organizational documents and any merger, consolidation, sale of all or substantially all of its assets or other major corporate transactions (although neither Founder will individually have a majority of the voting power). REE’s Founders may have interests that differ from yours and may vote in a way with which you disagree and which may be adverse to your interests. This concentrated control may have the effect of delaying, preventing or deterring a change in control of REE, could deprive its shareholders of an opportunity to receive a premium for their shares as part of a sale of REE, and might ultimately affect the market price of shares of REE Class A Ordinary Shares. For information about its dual class structure, see the section titled “Description of REE Ordinary Shares.”

REE cannot predict the impact REE’s dual class structure may have on the stock price of REE Class A Ordinary Shares.

REE cannot predict whether REE’s dual class structure will result in a lower or more volatile market price of REE Class A Ordinary Shares or in adverse publicity or other adverse consequences. For example, certain index providers have announced restrictions on including companies with multiple-class share structures in certain of their indexes. In July 2017, FTSE Russell and S&P Dow Jones announced that they would cease to allow most newly public companies utilizing dual or multi-class capital structures to be included in their indices. Affected indices include the Russell 2000 and the S&P 500, S&P MidCap 400 and S&P SmallCap 600, which together make up the S&P Composite 1500. Beginning in 2017, MSCI, a leading stock index provider, opened public consultations on their treatment of no-vote and multi-class structures and temporarily barred new multi-class listings from certain of its indices; however,

in October 2018, MSCI announced its decision to include equity securities “with unequal voting structures” in its indices and to launch a new index that specifically includes voting rights in its eligibility criteria. Under the announced policies, REE’s dual class capital structure would make us ineligible for inclusion in certain indices, and as a result, mutual funds, exchange-traded funds and other investment vehicles that attempt to passively track those indices will not be investing in its shares. These policies are still fairly new and it is as of yet unclear what effect, if any, they will have on the valuations of publicly traded companies excluded from the indices, but it is possible that they may depress these valuations compared to those of other similar companies that are included. Because of REE’s dual class structure, REE will likely be excluded from certain of these indexes and REE cannot assure you that other stock indexes will not take similar actions. Given the sustained flow of investment funds into passive strategies that seek to track certain indexes, exclusion from stock indexes would likely preclude investment by many of these funds and could make Class A Ordinary Shares less attractive to other investors. As a result, the market price of REE Class A Ordinary Shares could be adversely affected.

Risks Related to REE’s Incorporation and Location in Israel

Conditions in Israel could adversely affect REE’s business.

REE is incorporated under the laws of the State of Israel, and its principal research and development facilities, including REE’s major data centers, are located in Israel. Accordingly, political, economic and military conditions in Israel directly affect its business. Since the State of Israel was established in 1948, a number of armed conflicts have occurred between Israel and its Arab neighbors. In the event that REE’s facilities are damaged as a result of hostile action or hostilities otherwise disrupt the ongoing operation of its facilities, its ability to deliver products to its customer could be materially adversely affected.

REE’s commercial insurance does not cover losses that may occur as a result of events associated with war and terrorism. Although the Israeli government currently covers the reinstatement under the Property Tax and Compensation Fund Law, 1961, the reinstatement is limited and partial compensation value of direct damages that are caused by terrorist attacks or acts of war, REE cannot assure you that this government coverage will be maintained or that it will sufficiently cover REE’s potential damages. Any losses or damages incurred by REE could have a material adverse effect on its business.

Several countries, principally in the Middle East, still restrict doing business with Israel and Israeli companies, and additional countries may impose restrictions on doing business with Israel and Israeli companies if hostilities in Israel or political instability in the region continues or increases. Any hostilities involving Israel or the interruption or curtailment of trade between Israel and its present trading partners, or significant downturn in the economic or financial condition of Israel, could adversely affect REE’s operations and product development, and could cause its sales to decrease.

In addition, many Israeli citizens are obligated to perform several days, and in some cases more, of annual military reserve duty each year until they reach the age of 40 (or older, for reservists who are military officers or who have certain occupations) and, in the event of a military conflict, may be called to active duty. In response to increases in terrorist activity, there have been periods of significant call-ups of military reservists. It is possible that there will be military reserve duty call-ups in the future. REE’s operations could be disrupted by such call-ups, particularly if such call-ups include the call-up of members of REE’s management. Such disruption could materially adversely affect its business, financial condition and results of operations.

Investors’ rights and responsibilities of REE’s shareholders will be governed by Israeli law, which may differ in some respects from the rights and responsibilities of shareholders of non-Israeli companies.

Because REE was incorporated under Israeli law, the rights and responsibilities of its shareholders is governed by its Amended and Restated Articles and Israeli law. These rights and responsibilities differ in some respects from the rights and responsibilities of shareholders of U.S. and other non-Israeli corporations. In particular, a shareholder of an Israeli company has a duty to act in good faith and in a customary manner in exercising its rights and performing its obligations towards the company and other shareholders and to refrain from abusing its power in the company, including, among other things, in voting at the general meeting of shareholders on certain matters, such as an amendment to the company’s articles of association, an increase of the company’s authorized share capital, a merger of the company and approval of related party transactions that require shareholder approval. A shareholder also has

a general duty to refrain from discriminating against other shareholders. In addition, a controlling shareholder or a shareholder who knows that it possesses the power to determine the outcome of a shareholders’ vote or to appoint or prevent the appointment of an office holder in the company has a duty to act in fairness towards the company. These provisions may be interpreted to impose additional obligations and liabilities on REE’s shareholders that are not typically imposed on shareholders of U.S. corporations.

Provisions of Israeli law and REE’s Amended and Restated Articles to be effective upon the consummation of the Merger may delay, prevent or make undesirable an acquisition of all or a significant portion of its shares or assets.

Provisions of Israeli law and REE’s Amended and Restated Articles to be effective upon the closing of the Merger could have the effect of delaying or preventing a change in control and may make it more difficult for a third-party to acquire REE or its shareholders to elect different individuals to REE’s board of directors, even if doing so would be considered to be beneficial by some of REE’s shareholders, and may limit the price that investors may be willing to pay in the future for REE’s Ordinary Shares. Among other things:

•        Israeli corporate law regulates mergers and requires that a tender offer be effected when more than a specified percentage of shares in a company are purchased;

•        Israeli corporate law requires special approvals for certain transactions involving directors, officers or significant shareholders and regulates other matters that may be relevant to these types of transactions;

•        Israeli corporate law does not provide for shareholder action by written consent for public companies, thereby requiring all shareholder actions to be taken at a general meeting of shareholders;

•        the Amended and Restated Articles generally will require a vote of a simple majority of the voting power represented at a general meeting of shareholders in person or by proxy and voting thereon, as one class;

•        the Amended and Restated Articles generally will not permit a director to be removed except by a vote of the holders of (i) so long as any REE Class B Ordinary Shares remain outstanding, a simple majority of the voting power represented at a general meeting of shareholders in person or by proxy and voting thereon, as one class, and (ii) if no REE Class B Ordinary Shares remain outstanding, a supermajority of at least sixty-five percent (65%) of the voting power represented at a general meeting of shareholders in person or by proxy and voting thereon; and

•        the Amended and Restated Articles generally will provide that director vacancies may be filled by its board of directors.

Further, Israeli tax considerations may make potential transactions undesirable to REE or some of its shareholders whose country of residence does not have a tax treaty with Israel granting tax relief to such shareholders from Israeli tax. For example, Israeli tax law does not recognize tax-free share exchanges to the same extent as U.S. tax law. With respect to mergers, Israeli tax law allows for tax deferral in certain circumstances but makes the deferral contingent on the fulfillment of numerous conditions, including, a holding period of two years from the date of the transaction during which certain sales and dispositions of shares of the participating companies are restricted. Moreover, with respect to certain share swap transactions, the tax deferral is limited in time, and when such time expires, the tax becomes payable even if no disposition of the shares has occurred.

The tax benefits that are available to REE require it to continue to meet various conditions and may be terminated or reduced in the future, which could increase REE’s costs and taxes.

REE may be eligible for certain tax benefits provided to “Preferred Technological Enterprises” under the Israeli Law for the Encouragement of Capital Investments, 1959, referred to as the Investment Law. In order to remain eligible for the tax benefits for “Preferred Technological Enterprises” it must continue to meet certain conditions stipulated in the Investment Law and its regulations, as amended. If these tax benefits are reduced, cancelled or discontinued, REE’s Israeli taxable income from the approved enterprise would be subject to regular Israeli corporate tax rates. The standard corporate tax rate for Israeli companies in 2016 was 25% of their taxable income and was reduced to 24% in 2017 and 23% in 2018 and thereafter. Additionally, if REE increases its activities outside of Israel through acquisitions, for example, its expanded activities might not be eligible for inclusion in future Israeli tax benefit programs. See “Certain Material Israeli Tax Considerations.”

REE’s Amended and Restated Articles to be effective upon consummation of the Merger provide that unless REE consents otherwise, the competent courts of Tel Aviv, Israel shall be the sole and exclusive forum for substantially all disputes between REE and its shareholders’ under the Companies Law and the Israeli Securities Law, which could limit its shareholders ability to brings claims and proceedings against, as well as obtain favorable judicial forum for disputes with REE, its directors, officers and other employees.

The competent courts of Tel Aviv, Israel shall be the exclusive forum for (i) any derivative action or proceeding brought on behalf of REE, (ii) any action asserting a claim of breach of fiduciary duty owed by any director, officer or other employee of REE to REE or REE’s shareholders, or (iii) any action asserting a claim arising pursuant to any provision of the Companies Law or the Israeli Securities Law. This exclusive forum provision is intended to apply to claims arising under Israeli Law and would not apply to claims brought pursuant to the Securities Act or the Exchange Act or any other claim for which federal courts would have exclusive jurisdiction. Such exclusive forum provision in the Amended and Restated Articles will not relieve REE of its duties to comply with federal securities laws and the rules and regulations thereunder, and shareholders of REE will not be deemed to have waived REE’s compliance with these laws, rules and regulations. This exclusive forum provision may limit a shareholder’s ability to bring a claim in a judicial forum of its choosing for disputes with REE or its directors or other employees which may discourage lawsuits against REE, its directors, officers and employees.

Risks Related to the Merger

10X Capital may not have sufficient funds to consummate the Merger.

As of November 24, 2020, 10X Capital had approximately $1,000,000 available to it outside the Trust Account to fund its working capital requirements. If 10X Capital is required to seek additional capital, it would need to borrow funds from the Sponsor, its management team or other third parties to operate or it may be forced to liquidate. None of such persons is under any obligation to advance funds to 10X Capital in such circumstances. Any such advances would be repaid only from funds held outside the Trust Account or from funds released to 10X Capital upon completion of the Merger. If 10X Capital is unable to consummate the Merger because it does not have sufficient funds available, 10X Capital will be forced to cease operations and liquidate the Trust Account. Consequently, 10X Capital’s Public Stockholders may receive less than $10 per share and their warrants will expire worthless.

The Merger remains subject to conditions that 10X Capital cannot control and if such conditions are not satisfied or waived, the Merger may not be consummated.

The Merger is subject to a number of conditions, including the condition that 10X Capital maintaining at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-5(g)(1) of the Exchange Act) either immediately prior to or upon consummation of the Merger, having the Minimum Cash Amount, the condition that there is no legal prohibition against consummation of the Merger, that the REE Class A Ordinary Shares be approved for listing on Nasdaq subject only to official notice of issuance thereof and the requirement to have a sufficient number of round lot holders, receipt of securityholder approvals, continued effectiveness of the registration statement of which this proxy statement/prospectus is a part, the truth and accuracy of 10X Capital’s and REE’s representations and warranties made in the Merger Agreement, the non-termination of the Merger Agreement and consummation of certain ancillary agreements. There are no assurances that all conditions to the Merger will be satisfied or that the conditions will be satisfied in the time frame expected.

REE may issue additional REE Class A Ordinary Shares or other securities following the Merger without shareholder approval, which would dilute existing ownership interests and may depress the market price of REE Class A Ordinary Shares.

REE may issue additional REE Class A Ordinary Shares or other equity securities of equal or senior rank in the future in connection with, among other things, REE’s equity incentive plan, without shareholder approval, in a number of circumstances. REE’s issuance of additional REE Class A Ordinary Shares or other equity securities of equal or senior rank would have the following effects:

•        REE’s existing shareholders’ proportionate ownership interest in REE may decrease;

•        the amount of cash available per share, including for payment of dividends in the future, may decrease;

•        the relative voting strength of each previously outstanding REE Class A Ordinary Share may be diminished; and

•        the market price of REE Class A Ordinary Shares may decline.

Following the Merger, voting control will be concentrated among the holders of REE Class B Ordinary Shares. As a result, the market price of REE Class A Ordinary Shares may be materially adversely affected by such disparate voting rights.

Following the Effective Time, the Founders will beneficially own all of the outstanding shares of REE Class B Ordinary Shares, collectively representing up to approximately 78% of total voting power, and holders of REE Class A Ordinary Shares will own shares of REE Class A Ordinary Shares, representing at least 22% of total voting power. As long as the Founders beneficially own a majority of total voting power, they will have the ability, without the consent of the public holders of REE Class A Ordinary Shares, to elect all of the members of REE’s board of directors and to control REE’s management and affairs (although no Founder will individually have a majority of the voting power). In addition, they will be able to determine the outcome of matters submitted to a vote of REE’s shareholders for approval and will be able to cause or prevent a change of control of REE.

The holders of REE Class A Ordinary Shares will be entitled to one vote per share, while holders of REE Class B Ordinary Shares will be entitled to 10 votes per share on all matters to be voted on by shareholders in general. While the REE Class B Ordinary Shares do not have any economic rights, the differential in the voting rights of REE Class B Ordinary Shares could adversely affect the market price of REE Class A Ordinary Shares.

The Sponsor has agreed to vote its shares in favor of the Merger, regardless of how 10X Capital’s Public Stockholders vote.

In connection with the Merger, the Sponsor agreed to vote its shares of 10X Capital Common Stock in favor of the Merger. Currently, the Sponsor owns approximately 20% of the outstanding shares of 10X Capital Common Stock. The Sponsor also indicated that it intends to vote its shares in favor of all other proposals being presented at the meeting. In addition to the shares of 10X Capital Common Stock held by the Sponsor, 10X Capital would need 7,546,876 shares, or approximately 37.5%, of the 21,125,000 public shares sold in the 10X Capital IPO to be voted in favor of the Merger Proposal and other proposals in order for them to be approved (assuming all outstanding shares are voted on each proposal).

10X Capital did not obtain an opinion from an independent investment banking or accounting firm, and consequently, you have no assurance from an independent source that the price 10X Capital is paying in connection with the Merger is fair to 10X Capital from a financial point of view.

10X Capital is not required to obtain an opinion from an independent investment banking or accounting firm that the price 10X Capital is paying in connection with the Merger is fair to 10X Capital from a financial point of view. The 10X Capital board of directors did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the Merger. Its officers and directors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and have concluded that their experience and backgrounds, together with the experience and sector expertise of its financial advisors enabled them to make the necessary analyses and determinations regarding the Merger with REE. In addition, 10X Capital’s officers and directors and its advisors have substantial experience with mergers and acquisitions. Accordingly, investors will be relying solely on the judgment of the 10X Capital board of directors in valuing REE’s business, and assuming the risk that the board of directors may not have properly valued the Merger.

10X Capital and REE will incur significant transaction and transition costs in connection with the Merger.

10X Capital and REE have both incurred and expect to incur significant, non-recurring costs in connection with consummating the Merger and operating as a public company following the consummation of the Merger. REE may also incur additional costs to retain key employees. All expenses incurred in connection with the Merger, including all legal, accounting, consulting, investment banking and other fees, expenses and costs, will be for the account of the party incurring such fees, expenses and costs.

Subsequent to the completion of the Merger, REE may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on its financial condition, results of operations and REE’s ordinary share price, which could cause you to lose some or all of your investment.

Although 10X Capital has conducted extensive due diligence on REE, 10X Capital cannot assure you that this diligence will surface all material issues that may be present in REE’s business, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of REE’s business and outside of its control will not later arise. As a result of these factors, REE may be forced to later write-down or write-off assets, restructure its operations, or incur impairment or other charges that could result in its reporting losses. Even if 10X Capital’s due diligence successfully identified certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with 10X Capital’s preliminary risk analysis. Even though these charges may be non-cash items and would not have an immediate impact on REE’s liquidity, the fact that REE reports charges of this nature could contribute to negative market perceptions of REE or its securities. In addition, charges of this nature may cause REE to violate net worth or other covenants to which REE may be subject as a result of REE obtaining post-combination debt financing. Accordingly, any stockholders who choose to remain shareholders following the Merger could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value.

The REE securities to be received by 10X Capital’s securityholders as a result of the Merger will have different rights from 10X Capital securities.

Following completion of the Merger, 10X Capital’s securityholders will no longer be securityholders of 10X Capital but will instead be securityholders of REE. There will be important differences between your current rights as a 10X Capital securityholder and your rights as a REE securityholder. See “Comparison of Rights of REE Shareholders and 10X Capital Stockholders” for a discussion of the different rights associated with the REE securities.

10X Capital’s stockholders will have a reduced ownership and voting interest after consummation of the Merger and will exercise less influence over management.

After the completion of the Merger, 10X Capital’s stockholders will own a smaller percentage of REE than they currently own of 10X Capital. Immediately following the Merger, existing REE shareholders would hold approximately 84.1% of the issued and outstanding REE Class A Ordinary Shares and current public stockholders of 10X Capital and the Sponsor would hold approximately 5.5% and 2.2%, respectively, of the issued and outstanding REE Class A Ordinary Shares (assuming no holder of 10X Capital Common Stock exercises redemption rights as described in this proxy statement/prospectus). Consequently, 10X Capital’s stockholders, as a group, will have reduced ownership and voting power in REE compared to their ownership and voting power in 10X Capital.

Even if REE consummates the Merger, there is no guarantee that the REE warrants will ever be in the money, and they may expire worthless and the terms of the warrants may be amended.

Upon consummation of the Merger, the 10X Capital Warrants will become REE warrants. The exercise price for the REE warrants will be $11.50 per ordinary share. There is no guarantee that the REE warrants, following the Merger, will ever be in the money prior to their expiration, and as such, the warrants may expire worthless.

10X Capital’s current directors and executive officers beneficially own shares of 10X Capital Common Stock and Warrants that will be worthless if the Merger is not approved. Such interests may have influenced their decision to approve the Merger with REE.

10X Capital’s officers and directors and/or their affiliates beneficially own or have a pecuniary interest in shares that the Sponsor purchased prior to, or simultaneously with, 10X Capital’s IPO. 10X Capital’s executive officers and directors and their affiliates have no redemption rights with respect to these securities in the event a business combination is not effected in the required time period. Therefore, if the Merger with REE or another business combination is not approved within the required time period, such securities held by such persons will be worthless. Such securities had an aggregate market value of approximately $50.01 million based upon the closing prices of 10X Capital Class A Common Stock and Units on Nasdaq on May 28, 2021. Furthermore, the Sponsor, 10X Capital’s officers or directors, or their affiliates are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on 10X Capital’s behalf, such as identifying and investigating possible business targets and Mergers. If 10X Capital fails to consummate the Merger, they will not have any claim against the Trust Account for repayment or reimbursement. Accordingly, 10X Capital may not be able to repay or reimburse these amounts if the Merger is not completed. See the section entitled “Proposal No. 1 — The Merger Proposal — Interests of 10X Capital’s Directors and Officers in the Merger.”

These financial interests may have influenced the decision of 10X Capital’s directors to approve the Merger with REE and to continue to pursue the Merger. In considering the recommendations of the 10X Capital board of directors to vote for the Merger Proposal and other proposals, 10X Capital’s Public Stockholders should consider these interests.

10X Capital warrants are accounted for as liabilities and the changes in value of 10X Capital warrants could have a material effect on 10X Capital’s financial results.

On April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the SEC together issued a statement regarding the accounting and reporting considerations for warrants issued by special purpose acquisition companies entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Staff Statement”). Specifically, the SEC Staff Statement focused on certain settlement terms and provisions related to certain tender offers following a business combination, which terms are similar to those contained in the warrant agreement governing 10X Capital warrants. As a result of the SEC Staff Statement, 10X Capital reevaluated the accounting treatment of its 10,062,500 Public Warrants and 5,500,000 Private Placement Warrants, and determined to classify the warrants as derivative liabilities measured at fair value, with changes in fair value each period reported in earnings.

As a result, included on 10X Capital’s balance sheet as of December 31, 2021 contained elsewhere in this Registration Statement are derivative liabilities related to its warrants. Accounting Standards Codification 815, Derivatives and Hedging (“ASC 815”), provides for the remeasurement of the fair value of such derivatives at each balance sheet date, with a resulting non-cash gain or loss related to the change in the fair value being recognized in earnings in the statement of operations. As a result of the recurring fair value measurement, 10X Capital’s financial statements and results of operations may fluctuate quarterly, based on factors, which are outside of its control. Due to the recurring fair value measurement, 10X Capital expects that it will recognize non-cash gains or losses on its warrants each reporting period and that the amount of such gains or losses could be material. The impact of changes in fair value on earnings may have an adverse effect on the market price of 10X Capital’s Common Stock.

10X Capital has identified a material weakness in its internal control over financial reporting. This material weakness could continue to adversely affect 10X Capital’s ability to report its results of operations and financial condition accurately and in a timely manner.

10X Capital’s management is responsible for establishing and maintaining adequate internal control over financial reporting designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. 10X Capital’s management is likewise required, on a quarterly basis, to evaluate the effectiveness of our internal controls and to disclose any changes and material weaknesses identified through such evaluation in those internal controls. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of 10X Capital’s annual or interim financial statements will not be prevented or detected on a timely basis.

10X Capital identified a material weakness in its internal control over financial reporting related to the accounting for a significant and unusual transaction related to the warrants it issued in connection with its initial public offering in November 2020. As a result of this material weakness, 10X Capital’s management concluded that its internal control over financial reporting was not effective as of December 31, 2020. This material weakness resulted in a material misstatement of 10X Capital’s warrant liabilities, change in fair value of warrant liabilities, Class A Common Stock subject to possible redemption, additional paid-in capital, accumulated deficit and related financial disclosures for the fiscal year ended December 31, 2020 (the “Affected Period”).

To respond to this material weakness, 10X Capital has devoted significant effort and resources to the remediation and improvement of its internal control over financial reporting, see “Note 2 — Restatement of Previously Issued Financial Statements” to the accompanying consolidated financial statements.

Efforts to remediate this material weakness may not be effective or prevent any future material weakness or significant deficiency in 10X Capital’s internal control over financial reporting. If 10X Capital’s efforts are not successful or other material weaknesses or control deficiencies occur in the future, it may be unable to report its financial results accurately on a timely basis, which could cause its reported financial results to be materially misstated and result in

the loss of investor confidence and cause the market price of its Common Stock to decline. Ineffective internal controls could also cause investors to lose confidence in 10X Capital’s reported financial information, which could have a negative effect on the trading price of its stock.

10X Capital can give no assurance that the measures it has taken or plan to take in the future will remediate the material weakness identified or that any additional material weaknesses or restatements of financial results will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting or circumvention of these controls. 10X Capital will be required, pursuant to Section 404 of the Sarbanes-Oxley Act, to annually furnish a report by management on, among other things, the effectiveness of its internal control over financial reporting. This assessment will need to include disclosure of any material weaknesses identified by 10X Capital’s management in its internal control over financial reporting. 10X Capital’s independent registered public accounting firm may be required to attest to the effectiveness of its internal control over financial reporting depending on its reporting status. 10X Capital will be required to disclose changes made in its internal control and procedures on a quarterly basis. To comply with the requirements of being a public company, 10X Capital may need to undertake various actions, such as implementing new internal controls and procedures and hiring accounting or internal audit staff.

10X Capital may face litigation and other risks as a result of the material weakness in its internal control over financial reporting.

Following the issuance of the SEC Staff Statement, after consultation with its independent registered public accounting firm, 10X Capital’s management and its audit committee concluded that it was appropriate to restate its previously issued audited financial statements as of December 31, 2020. As discussed elsewhere in this proxy statement/prospectus, 10X Capital identified a material weakness in its internal controls over financial reporting related to the accounting for a significant and unusual transaction related to the warrants it issued in connection with its initial public offering in November 2020.

As a result of such material weakness, the restatement of 10X Capital’s financial statements for the Affected Period, the change in accounting for the warrants, and other matters raised or that may in the future be raised by the SEC, 10X Capital faces potential for litigation or other disputes which may include, among others, claims invoking the federal and state securities laws, contractual claims or other claims arising from the restatement and material weaknesses in its internal control over financial reporting and the preparation of its financial statements. As of the date of this proxy statement/prospectus, 10X Capital has no knowledge of any such litigation or dispute. However, 10X Capital can provide no assurance that such litigation or dispute will not arise in the future. Any such litigation or dispute, whether successful or not, could have a material adverse effect on the business of the combined company and its results of operations and financial condition.

The Sponsor, an affiliate of a director of 10X Capital, is liable to ensure that proceeds of the Trust Account are not reduced by vendor claims in the event the Merger is not consummated. Such liability may have influenced the 10X Capital board of directors’ decision to pursue the Merger and the board’s decision to approve it.

If the Merger or another business combination is not consummated by 10X Capital on or before May 27, 2022, the Sponsor, an affiliate of a director of 10X Capital, will be liable to ensure that the proceeds in the Trust Account are not reduced by the claims of target businesses or claims of vendors or other entities that are owed money by 10X Capital for services rendered or contracted for or for products sold to 10X Capital, but only if such a vendor or target business has not executed a waiver agreement. If 10X Capital consummates an initial business combination, on the other hand, 10X Capital will be liable for all such claims. 10X Capital has no reason to believe that the Sponsor will not be able to fulfill its indemnity obligations to 10X Capital.

These obligations of the Sponsor may have influenced the 10X Capital board of directors’ decision to pursue the Merger with REE or the board’s decision to approve the Merger. In considering the recommendations of the 10X Capital board of directors to vote for the Merger Proposal and other proposals, stockholders should consider these interests. See the section of this proxy statement/prospectus titled “Proposal No. 1 — The Merger Proposal — Interests of 10X Capital’s Directors and Officers in the Merger.”

10X Capital’s directors may decide not to enforce the indemnification obligations of the Sponsor, resulting in a reduction in the amount of funds in the Trust Account available for distribution to 10X Capital’s Public Stockholders in the event an initial business combination is not consummated.

If proceeds in the Trust Account are reduced below $10.00 per public share and the Sponsor asserts that it is unable to satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim, 10X Capital’s independent directors would determine whether to take legal action against the Sponsor to enforce its indemnification obligations. While 10X Capital currently expects that its independent directors would take legal action on 10X Capital’s behalf against the Sponsor to enforce the Sponsor’s indemnification obligations, it is possible that 10X Capital’s independent directors in exercising their business judgment may choose not to do so in any particular instance. If 10X Capital’s independent directors choose not to enforce these indemnification obligations, the amount of funds in the Trust Account available for distribution to 10X Capital’s Public Stockholders may be reduced below $10.00 per share.

Activities taken by existing 10X Capital stockholders to increase the likelihood of approval of the Merger Proposal and other proposals could have a depressive effect on the 10X Capital Common Stock.

At any time prior to the Special Meeting, during a period when they are not then aware of any material nonpublic information regarding 10X Capital or its securities, the Sponsor, as an initial stockholder of 10X Capital, 10X Capital’s officers and directors, REE, the REE officers and directors and/or their respective affiliates, or REE shareholders may purchase 10X Capital Common Stock from institutional and other investors who vote, or indicate an intention to vote, against the Merger Proposal, or execute agreements to purchase such shares from such investors in the future, or they may enter into transactions with such investors and others to provide them with incentives to acquire shares of 10X Capital Common Stock or vote their shares of 10X Capital Common Stock in favor of the Merger Proposal. The purpose of such purchases and other transactions would be to increase the likelihood of approval of the Merger Proposal by the holders of a majority of the outstanding shares of 10X Capital Common Stock and ensure that 10X Capital has in excess of $5,000,001 of net assets and the Minimum Cash Amount to consummate the Merger where it appears that such requirement would otherwise not be met. While the exact nature of any such incentives has not been determined as of the date of this proxy statement/prospectus, they might include, without limitation, arrangements to protect such investors or holders against potential loss in value of their shares, including the granting of put options and the transfer to such investors or holders of shares owned by the Sponsor for nominal value. Entering into any such arrangements may have a depressive effect on the 10X Capital Common Stock. For example, as a result of these arrangements, an investor or holder may have the ability to effectively purchase shares of 10X Capital Common Stock at a price lower than market and may therefore be more likely to sell the 10X Capital Common Stock he owns, either prior to or immediately after the Special Meeting.

In addition, if such purchases are made, the public “float” of the REE Class A Ordinary Shares following the Merger and the number of beneficial holders of REE securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or trading of REE securities on Nasdaq or another national securities exchange or reducing the liquidity of the trading market for the REE Class A Ordinary Shares.

The Merger may be completed even though material adverse effects may result from the announcement of the Merger, industry-wide changes and other causes.

In general, either 10X Capital or REE may refuse to complete the Merger if there is a material adverse effect affecting the other party between the signing date of the Merger Agreement and the planned closing. However, certain types of changes do not permit either party to refuse to consummate the Merger, even if such change could be said to have a material adverse effect on REE or 10X Capital, including the following events (except, in certain cases where the change has a disproportionate effect on a party):

•        changes generally affecting the economy and the financial or securities markets, including the COVID-19 pandemic;

•        the outbreak or escalation of war or any act of terrorism, civil unrest or natural disasters;

•        changes (including changes in law) or general conditions in the industry in which the party operates;

•        changes in U.S. GAAP, or the authoritative interpretation of U.S. GAAP; or

•        changes attributable to the public announcement or pendency of the Merger or the execution or performance of the Merger Agreement.

Furthermore, 10X Capital or REE may waive the occurrence of a material adverse effect affecting the other party. If a material adverse effect occurs and the parties still consummate the Merger, the market trading price of REE’s ordinary shares and REE warrants may suffer.

Delays in completing the Merger may substantially reduce the expected benefits of the Merger.

Satisfying the conditions to, and completion of, the Merger may take longer than, and could cost more than, 10X Capital expects. Any delay in completing or any additional conditions imposed in order to complete the Merger may materially adversely affect the benefits that 10X Capital expects to achieve from the Merger.

10X Capital and REE have no history operating as a combined company. The unaudited pro forma condensed combined financial information may not be an indication of REE’s financial condition or results of operations following the Merger, and accordingly, you have limited financial information on which to evaluate REE and your investment decision.

REE has a limited operating history and REE and 10X Capital have no prior history as a combined entity and their operations have not been previously managed on a combined basis. The unaudited pro forma condensed combined financial information contained in this proxy statement/prospectus has been prepared using the consolidated historical financial statements of 10X Capital and REE, and is presented for illustrative purposes only and should not be considered to be an indication of the results of operations including, without limitation, future revenue, or financial condition of REE following the Merger. Certain adjustments and assumptions have been made regarding 10X Capital and REE after giving effect to the Merger. REE and 10X Capital believe these assumptions are reasonable, however, the information upon which these adjustments and assumptions have been made is preliminary, and these kinds of adjustments are difficult to make with accuracy. These assumptions may not prove to be accurate, and other factors may affect REE’s results of operations or financial condition following the consummation of the Merger. For these and other reasons, the historical and pro forma condensed combined financial information included in this proxy statement/prospectus does not necessarily reflect REE’s results of operations and financial condition and the actual financial condition and results of operations of REE following the Merger may not be consistent with, or evident from, this pro forma financial information.

The projections and forecasts presented in this proxy statement/prospectus may not be an indication of the actual results of the transaction or REE’s future results.

This proxy statement/prospectus contains projections and forecasts prepared by REE. None of the projections and forecasts included in this proxy statement/prospectus have been prepared with a view toward public disclosure other than to certain parties involved in the Merger or toward complying with SEC guidelines or U.S. GAAP. The projections and forecasts were prepared based on numerous variables and assumptions which are inherently uncertain and may be beyond the control of REE and 10X Capital and exclude, among other things, transaction-related expenses. Important factors that may affect actual results and results of REE’s operations following the Merger, or could lead to such projections and forecasts not being achieved include, but are not limited to: client demand for REE’s products, an evolving competitive landscape, rapid technological change, margin shifts in the industry, regulation changes in a highly regulated environment, successful management and retention of key personnel, unexpected expenses and general economic conditions. As such, these projections and forecasts may be inaccurate and should not be relied upon as an indicator of actual past or future results.

10X Capital may not be able to complete the Merger or any other Merger within the prescribed time frame, in which case 10X Capital would cease all operations, except for the purpose of winding up and 10X Capital would redeem 10X Capital’s Public Shares and liquidate.

10X Capital must complete an initial combination by May 27, 2022. 10X Capital may not be able to consummate the Merger or any other Merger by such date. If 10X Capital has not completed any initial business combination by such date, it will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of taxes payable)

divided by the number of then outstanding Public Shares, which redemption will completely extinguish the Public Stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of 10X Capital’s remaining stockholders and board of directors, dissolve and liquidate, subject in each case to 10X Capital’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

10X Capital stockholders may be held liable for claims by third parties against 10X Capital to the extent of distributions received by them upon redemption of their shares in a liquidation.

If the Merger is not completed, then under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion of 10X Capital’s Trust Account distributed to 10X Capital’s Public Stockholders upon the redemption of 10X Capital’s Public Shares in the event 10X Capital does not complete an initial business combination by May 27, 2022 may be considered a liquidation distribution under Delaware law. If a corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution.

Because 10X Capital may not comply with Section 280, Section 281(b) of the DGCL requires 10X Capital to adopt a plan, based on facts known to 10X Capital at such time that will provide for 10X Capital’s payment of all existing and pending claims or claims that may be potentially brought against 10X Capital within the 10 years following 10X Capital’s dissolution. However, because 10X Capital is a blank check company, rather than an operating company, and 10X Capital’s operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from 10X Capital’s vendors (such as lawyers, investment bankers and auditors) or prospective target businesses. If 10X Capital’s plan of distribution complies with Section 281(b) of the DGCL, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would likely be barred after the third anniversary of the dissolution. 10X Capital cannot assure you that it will properly assess all claims that may be potentially brought against it. As such, 10X Capital’s Public Stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of 10X Capital’s Public Stockholders may extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of the Trust Account distributed to 10X Capital’s Public Stockholders upon the redemption of its Public Shares in the event 10X Capital does not complete an initial business combination by May 27, 2022 is not considered a liquidation distribution under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidation distribution.

10X Capital may be a target of securities class action and derivative lawsuits which could result in substantial costs and may delay or prevent the Merger from being completed.

Securities class action lawsuits and derivative lawsuits are often brought against companies that have entered into merger agreements or similar agreements. Even if the lawsuits are without merit, defending against these claims can result in substantial costs and divert management time and resources. An adverse judgment could result in monetary damages, which could have a negative impact on 10X Capital’s liquidity and financial condition. Additionally, if a plaintiff is successful in obtaining an injunction prohibiting consummation of the Merger, then that injunction may delay or prevent the Merger from being completed. Currently, 10X Capital is not aware of any securities class action lawsuits or derivative lawsuits being filed in connection with the Merger.

The ongoing COVID-19 pandemic may adversely affect 10X Capital’s and REE’s ability to consummate the Merger.

The COVID-19 pandemic has resulted in governmental authorities worldwide implementing numerous measures to contain the virus, including travel restrictions, quarantines, shelter-in-place orders and business limitations and

shutdowns. More generally, the pandemic raises the possibility of an extended global economic downturn and has caused volatility in financial markets. The pandemic may also amplify many of the other risks described in this proxy statement/prospectus.

10X Capital and REE may be unable to complete the Merger if continued concerns relating to COVID-19 restrict travel and limit the ability to have meetings with REE personnel. The extent to which COVID-19 impacts 10X Capital’s and REE’s ability to consummate the Merger will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19 or other matters of global concern continue for an extended period of time, 10X Capital’s and REE’s ability to consummate the Merger may be materially adversely affected.

The grant and future exercise of registration rights may adversely affect the market price of REE Class A Ordinary Shares upon consummation of the Merger.

Pursuant to the Investors’ Rights Agreement which is described elsewhere in this proxy statement/prospectus, the Sponsor can demand that REE register its registrable securities under certain circumstances and will also have piggyback registration rights for these securities in connection with certain registrations of securities that REE undertakes. In addition, following the consummation of the Merger, REE is required to file and maintain an effective registration statement under the Securities Act covering such securities and certain other securities of REE, including those held by PIPE Investors.

The registration of these securities will permit the public sale of such securities. The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of REE Class A Ordinary Shares post-Merger.

10X Capital has had a limited opportunity to assess the management of REE’s business and, as a result, cannot assure you that REE’s management has all the skills, qualifications or abilities necessary to manage a public company.

10X Capital’s ability to assess REE’s management may be limited due to a lack of time, resources or information. 10X Capital’s assessment of the capabilities of REE’s management, therefore, may prove to be incorrect and REE management may lack the skills, qualifications or abilities that 10X Capital believed the REE management to have. Should REE’s management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and profitability of REE or REE post-Merger may be negatively impacted. Accordingly, any stockholders who choose to remain stockholders of REE following the Merger could suffer a reduction in the value of their shares.

If the Adjournment Proposal is not approved, and an insufficient number of votes have been obtained to authorize the consummation of the Merger, the 10X Capital board of directors will not have the ability to adjourn the Special Meeting to a later date in order to solicit further votes, and, therefore, the Merger will not be approved.

The 10X Capital board of directors is seeking approval to adjourn the Special Meeting to a later date or dates if, at the Special Meeting, based upon the tabulated votes, there are insufficient votes to approve the consummation of the Merger. If the Adjournment Proposal is not approved, the 10X Capital board of directors will not have the ability to adjourn the Special Meeting to a later date and, therefore, will not have more time to solicit votes to approve the consummation of the Merger. In such event, the Merger would not be completed.

The exercise of 10X Capital’s directors’ and officers’ discretion in agreeing to changes or waivers in the terms of the Merger may result in a conflict of interest when determining whether such changes to the terms of the Merger or waivers of conditions are appropriate and in 10X Capital’s stockholders’ best interest.

In the period leading up to the closing of the Merger, events may occur that, pursuant to the Merger Agreement, would require 10X Capital to agree to amend the Merger Agreement, to consent to certain actions taken by REE or to waive rights that 10X Capital is entitled to under the Merger Agreement. Such events could arise because of changes in the course of REE’s business, a request by REE to undertake actions that would otherwise be prohibited by the terms of the Merger Agreement or the occurrence of other events that would have a material adverse effect on REE’s business and would entitle 10X Capital to terminate the Merger Agreement. In any of those circumstances, it would be at 10X Capital’s discretion, acting through its board of directors, to grant its consent or waive those rights. The existence of

the financial and personal interests of the directors described in the preceding risk factors may result in a conflict of interest on the part of one or more of the directors between what they may believe is best for 10X Capital and what they may believe is best for themselves in determining whether or not to take the requested action. While certain changes could be made without further stockholder approval, 10X Capital will circulate a new or amended proxy statement/prospectus and resolicit 10X Capital’s stockholders if changes to the terms of the transaction that would have a material impact on its stockholders are required prior to the vote on the Merger Proposal.

Risks Related to the U.S. Federal Income Tax Treatment of the Merger

If the Merger does not qualify as a reorganization under Section 368(a) of the Code, is taxable under Section 367(a) of the Code, or is otherwise taxable to U.S. Holders of 10X Capital Common Stock and/or 10X Capital Warrants, then the Merger generally would be taxable with respect to such U.S. Holders.

The Merger (i) is intended to qualify as a reorganization within the meaning of Section 368(a) of the Code (a “reorganization”), and (ii) is not expected to result in gain being recognized by U.S. Holders (as defined in “Certain Material U.S. Federal Income Tax Considerations”) of 10X Capital Common Stock and/or 10X Capital Warrants immediately prior to the Effective Time (other than with respect to any such holder that would own, actually or constructively, 5% or more (by vote or value) of the outstanding shares of REE stock immediately after the Merger and that does not file a gain recognition agreement) (together, the “Intended Tax Treatment”). The parties intend to report the Merger in a manner consistent with the Intended Tax Treatment. However, there are significant factual and legal uncertainties as to whether the Merger will qualify for the Intended Tax Treatment. For example, under Section 368(a) of the Code and the Treasury regulations promulgated thereunder, the acquiring corporation (or, in the case of certain reorganizations structured similarly to the Merger, its corporate parent) must continue, either directly or indirectly through certain controlled corporations, either a significant line of the acquired corporation’s historic business or use a significant portion of the acquired corporation’s historic business assets in a business. However, there is an absence of guidance directly on point as to how the above rules apply in the case of an acquisition of a corporation with investment-type assets, such as 10X Capital. Moreover, Section 367(a) of the Code and the applicable Treasury regulations promulgated thereunder provide that, where a U.S. shareholder exchanges stock or securities in a U.S. corporation for stock or securities in a non-U.S. (“foreign”) corporation in a transaction that qualifies as a reorganization, the U.S. shareholder is required to recognize any gain, but not loss, realized on such exchange unless certain additional requirements are met. There are significant factual and legal uncertainties concerning the determination of whether these requirements will be satisfied. Moreover, the closing of the Merger is not conditioned upon the receipt of an opinion of counsel that the Merger will qualify for the Intended Tax Treatment, and neither 10X Capital nor REE intends to request a ruling from the IRS regarding the U.S. federal income tax treatment of the Merger. Accordingly, no assurance can be given that the IRS will not challenge the Intended Tax Treatment or that a court will not sustain a challenge by the IRS.

If, at the Effective Time, any requirement of Section 368(a) of the Code is not met, then a U.S. Holder of 10X Capital Common Stock and/or 10X Capital Warrants generally would recognize gain or loss in an amount equal to the difference, if any, between the fair market value (as of the closing date of the Merger) of REE Class A Ordinary Shares and/or REE warrants received in the Merger, over such holder’s aggregate adjusted tax basis in the corresponding 10X Capital Common Stock and/or 10X Capital Warrants surrendered by such holder in the Merger.

If the Merger does meet the requirements of Section 368(a) of the Code, but at the Effective Time, any requirement for Section 367(a) of the Code not to impose gain on a U.S. Holder is not satisfied, then a U.S. Holder of 10X Capital Common Stock and/or 10X Capital Warrants generally would recognize gain (but not loss) in an amount equal to the excess, if any, of the fair market value as of the closing date of the Merger of REE Class A Ordinary Shares and/or REE warrants received in the Merger, over such holder’s aggregate tax basis in the 10X Capital Common Stock and/or 10X Capital Warrants surrendered by such holder in the Merger.

The tax consequences of the Merger are complex and will depend on your particular circumstances. For a more detailed discussion of the U.S. federal income tax considerations of the Merger for U.S. Holders of 10X Capital Common Stock and/or 10X Capital Warrants, including the application of Section 367(a) of the Code, see the section entitled “Certain Material U.S. Federal Income Tax Considerations — U.S. Holders — U.S. Federal Income Tax Considerations of the Merger.” If you are a U.S. Holder whose 10X Capital Common Stock and/or 10X Capital Warrants are exchanged in the Merger, you are urged to consult your tax advisor to determine the tax consequences thereof.

The IRS may not agree that REE should be treated as a non-U.S. corporation for U.S. federal income tax purposes.

Although REE is incorporated and tax resident in Israel, the IRS may assert that it should be treated as a U.S. corporation for U.S. federal income tax purposes pursuant to Section 7874 of the Code. For U.S. federal income tax purposes, a corporation is generally considered a U.S. “domestic” corporation if it is created or organized in or under the laws of the U.S., any state thereof, or the District of Columbia. Because REE is not so created or organized (but is instead incorporated only in Israel), it would generally be classified as a foreign corporation (that is, a corporation other than a U.S. “domestic” corporation) under these rules. Section 7874 of the Code provides an exception under which a corporation created or organized only under foreign law may, in certain circumstances, be treated as a U.S. corporation for U.S. federal income tax purposes.

As more fully described in the section titled “Certain Material U.S. Federal Income Tax Considerations — U.S. Federal Income Tax Treatment of REE — Tax Residence of REE for U.S. Federal Income Tax Purposes,” based on the terms of the Merger, the rules for determining share ownership under Code Section 7874 and the Treasury regulations promulgated under Code Section 7874 (the “Section 7874 Regulations”), and certain factual assumptions, REE is not currently expected to be treated as a U.S. corporation for U.S. federal income tax purposes under Code Section 7874 after the Merger. However, the application of Section 7874 of the Code is complex, is subject to detailed regulations (the application of which is uncertain in various respects and would be impacted by changes in such U.S. tax laws and regulations with possible retroactive effect), and is subject to certain factual uncertainties. Accordingly, there can be no assurance that the IRS will not challenge the status of REE as a foreign corporation under Code Section 7874 or that such challenge would not be sustained by a court.

If the IRS were to successfully challenge under Code Section 7874 REE’s status as a foreign corporation for U.S. federal income tax purposes, REE and certain REE shareholders could be subject to significant adverse tax consequences, including a higher effective corporate income tax rate on REE and future withholding taxes on certain REE shareholders, depending on the application of any income tax treaty that might apply to reduce such withholding taxes. In particular, holders of REE Class A Ordinary Shares and/or REE warrants would be treated as holders of stock and warrants of a U.S. corporation.

See “Certain Material U.S. Federal Income Tax Considerations — U.S. Federal Income Tax Treatment of REE — Tax Residence of REE for U.S. Federal Income Tax Purposes” for a more detailed discussion of the application of Code Section 7874 to the Merger. Investors in REE should consult their own advisors regarding the application of Code Section 7874 to the Merger.

Code Section 7874 may limit the ability of 10X Capital to use certain tax attributes following the Merger, increase REE’s U.S. affiliates’ U.S. taxable income or have other adverse consequences to REE and REE’s shareholders.

Following the acquisition of a U.S. corporation by a foreign corporation, Code Section 7874 can limit the ability of the acquired U.S. corporation and its U.S. affiliates to use U.S. tax attributes (including net operating losses and certain tax credits) to offset U.S. taxable income resulting from certain transactions, as well as result in certain other adverse tax consequences, even if the acquiring foreign corporation is respected as a foreign corporation for purposes of Code Section 7874. In general, if a foreign corporation acquires, directly or indirectly, substantially all of the properties held directly or indirectly by a U.S. corporation, and after the acquisition the former shareholders of the acquired U.S. corporation hold at least 60% (by either vote or value) but less than 80% (by vote and value) of the shares of the foreign acquiring corporation by reason of holding shares in the acquired U.S. corporation, subject to other requirements, certain adverse tax consequences under Section 7874 of the Code may apply.

If these rules apply to the Merger, REE and certain of REE’s shareholders may be subject to adverse tax consequences including, but not limited to, restrictions on the use of tax attributes with respect to “inversion gain” recognized over a 10-year period following the transaction, disqualification of dividends paid from preferential “qualified dividend income” rates and the requirement that any U.S. corporation owned by REE include as “base erosion payments” that may be subject to a minimum U.S. federal income tax any amounts treated as reductions in gross income paid to certain related foreign persons. Furthermore, certain “disqualified individuals” (including officers and directors of a U.S. corporation) may be subject to an excise tax on certain stock-based compensation held thereby at a rate of 20%.

As more fully described in the section titled “Certain Material U.S. Federal Income Tax Considerations — U.S. Federal Income Tax Treatment of REE — Utilization of 10X Capital’s Tax Attributes and Certain Other Adverse Tax Consequences to REE and REE’s Shareholders,” based on the terms of the Merger, the rules for determining share ownership under Section 7874 of the Code and the Section 7874 Regulations (as defined in “Certain Material U.S.

Risks Related to Ownership of the Combined Company Shares

U.S. Holders of REE Class A Ordinary Shares and/or REE warrants may suffer adverse tax consequences if REE is treated as a passive foreign investment company.

A non-U.S. corporation generally will be treated as a “passive foreign investment company,” or a PFIC, for U.S. federal income tax purposes, in any taxable year if either (1) at least 75% of its gross income for such year is passive income (such as interest, dividends, rents and royalties (other than rents or royalties derived from the active conduct of a trade or business) and gains from the disposition of assets giving rise to passive income) or (2) at least 50% of the value of its assets (based on an average of the quarterly values of the assets) during such year is attributable to assets that produce or are held for the production of passive income. Based on the current and anticipated composition of the income, assets and operations of REE and its subsidiaries, there is a significant risk that REE will be a PFIC for U.S. federal income tax purposes for the taxable year that includes the Merger, and REE may be a PFIC for U.S. federal income tax purposes for future taxable years. This is a factual determination that depends on, among other things, the composition of REE’s income and assets, and the market value of its shares and assets, including the composition of income and assets and the market value of shares and assets of its subsidiaries, from time to time, and thus a complete determination can only be made annually after the close of each taxable year. Thus, no assurance can be given as to whether REE will be a PFIC in 2021 or for any future taxable year. In addition, REE’s U.S. counsel expresses no opinion with respect to REE’s PFIC status for 2021 or future taxable years.

If REE is a PFIC for any taxable year, a U.S. Holder of REE Class A Ordinary Shares and/or REE warrants may be subject to adverse tax consequences and may incur certain information reporting obligations. Under the PFIC rules, unless such U.S. Holder makes an election available under the Code (which election could itself have adverse consequences for such U.S. Holder), such U.S. Holder may be subject to U.S. federal income tax at the then prevailing maximum rates on ordinary income and possibly an “interest” charge, in respect of “excess distributions” and upon any gain from the disposition of REE Class A Ordinary Shares and/or REE warrants, as if the excess distribution or gain had been recognized ratably over such U.S. Holder’s holding period of the REE Class A Ordinary Shares and/or REE warrants. Certain elections (including a qualified electing fund election (or a QEF election) or a mark-to-market election) that may be available to U.S. Holders of REE Class A Ordinary Shares to mitigate some of the adverse tax consequences resulting from PFIC treatment, however, are not available with respect to the REE warrants. Additionally, there can be no assurance that REE will have timely knowledge of its status as a PFIC in the future or that REE will timely provide information that would be required in order for a U.S. Holder to make a QEF election. For a further discussion, see “Certain Material U.S. Federal Income Tax Considerations — U.S. Holders — U.S. Federal Income Tax Consequences of the Ownership and Disposition of REE Class A Ordinary Shares and REE Warrants to U.S. Holders — Passive Foreign Investment Company Rules.” U.S. Holders of REE Class A Ordinary Shares and/or REE warrants are strongly encouraged to consult their own advisors regarding the potential application of these rules to REE and the ownership of REE Class A Ordinary Shares and/or REE warrants.

SPECIAL MEETING OF 10X CAPITAL STOCKHOLDERS

General

10X Capital is furnishing this proxy statement/prospectus to 10X Capital’s stockholders as part of the solicitation of proxies by the 10X Capital board of directors for use at the Special Meeting of 10X Capital stockholders to be held on             , 2021, and at any adjournment or postponement thereof. This proxy statement/prospectus provides 10X Capital’s stockholders with information they need to know to be able to vote or instruct their vote to be cast at the Special Meeting.

Date, Time and Place

The Special Meeting of stockholders will be held on           , 2021 at           , Eastern time, virtually accessible at            or at such other time, on such other date and at such other place to which the meeting may be adjourned or postponed.

At the Special Meeting, 10X Capital is asking holders of 10X Capital Common Stock to:

•        consider and vote upon the Merger Proposal;

•        consider and vote upon the Class B Charter Proposal;

•        consider and vote upon the Material Differences Charter Proposal; and

•        consider and vote upon the Adjournment Proposal, if presented.

Recommendation of the 10X Capital Board of Directors

The 10X Capital board of directors has unanimously determined that each of the Merger Proposal, the Class B Charter Proposal, the Material Differences Charter Proposal, and the Adjournment Proposal to be presented at the Special Meeting is in the best interests of 10X Capital and its stockholders, and unanimously recommends that 10X Capital stockholders vote “FOR” each of the proposals.

Record Date; Outstanding Shares; Stockholders Entitled to Vote

10X Capital has fixed the close of business on June 2, 2021, as the “record date” for determining 10X Capital stockholders entitled to notice of and to attend and vote at the Special Meeting. As of the close of business on the record date, there were 25,156,250 shares of 10X Capital Common Stock outstanding and entitled to vote. Each share of 10X Capital Common Stock is entitled to one vote per share at the Special Meeting.

Quorum

The presence, virtually or by proxy, of a majority of all the outstanding shares of 10X Capital Common Stock entitled to vote constitutes a quorum at the Special Meeting.

Abstentions and Broker Non-Votes

Proxies that are marked “abstain”, shares represented at the Special Meeting by virtual attendance or by proxy but not voted on one or more proposals or a broker non-vote so long as the stockholder has given the bank, broker or other nominee voting instructions on at least one proposal in this proxy statement/prospectus, will each count as present for the purposes of establishing a quorum. In the absence of a quorum, the chairman of the Special Meeting may adjourn the Special Meeting. As of the record date for the Special Meeting, the presence by virtual attendance or by proxy of 12,578,126 shares of 10X Capital Common Stock is required to achieve a quorum.

Vote Required

The approval of the Merger Proposal, the Class B Charter Proposal, and the Material Differences Charter Proposal will require the affirmative vote by the holders of a majority of the outstanding shares of 10X Capital Common Stock. The approval of the Adjournment Proposal, if presented, will require the affirmative vote of a majority of the votes cast by holders of 10X Capital Common Stock present and entitled to vote at the meeting. Abstentions will have the same

effect as a vote “AGAINST” the Merger Proposal, the Class B Charter Proposal, or the Material Differences Charter Proposal, and on the Adjournment Proposal. Broker Non-Votes will have the same effect as a vote “AGAINST” the Merger Proposal, the Class B Charter Proposal, the Material Differences Charter Proposal, but will not have an effect on the Adjournment Proposal.

The Merger is conditioned on the approval of each of the Condition Precedent Proposals. The Condition Precedent Proposals are cross-conditioned on the approval of each other. The Adjournment Proposal is not conditioned upon the approval of any other proposal. Each of these proposals is more fully described in this proxy statement/prospectus, which each stockholder is encouraged to read carefully and in its entirety.

Voting Your Shares

Each share of 10X Capital Common Stock that you own in your name entitles you to one vote. Your proxy card shows the number of shares of 10X Capital Common Stock that you own. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted.

There are two ways to vote your shares of 10X Capital Common Stock at the Special Meeting:

You Can Vote by Signing and Returning the Enclosed Proxy Card.    If you vote by proxy card, your “proxy,” whose name is listed on the proxy card, will vote your shares as you instruct on the proxy card. If you sign and return the proxy card but do not give instructions on how to vote your shares, your shares will be voted as recommended by the 10X Capital board of directors “FOR” the Merger Proposal, the Class B Charter Proposal, the Material Differences Charter Proposal and the Adjournment Proposal, if presented. Votes received after a matter has been voted upon at the Special Meeting will not be counted.

You Can Virtually Attend the Special Meeting and Vote Online.    You will be able to vote virtually at         . However, if your shares are held in the name of your broker, bank or another nominee, you must get a legal proxy from the broker, bank or other nominee. That is the only way 10X Capital can be sure that the broker, bank or nominee has not already voted your shares.

Certain Voting Arrangements

As of June 2, 2021, the record date for the Special Meeting, the Sponsor beneficially owned and was entitled to vote 5,031,250 shares of 10X Capital Common Stock. In the aggregate, the foregoing shares represent approximately 20% of the issued and outstanding shares of 10X Capital Common Stock. The Sponsor has committed to 10X Capital to vote such shares in favor of the Merger Proposal. In addition, the Sponsor, and the Insiders have entered into the Support Agreement whereby they have agreed with REE to similarly vote shares of 10X Capital Common Stock that they currently hold or which they may acquire prior to the Special Meeting in favor of, and take certain other actions in support of, the Merger (including causing such shares to be present at the Special Meeting for the purposes of establishing a quorum).

Revoking Your Proxy

If you are a stockholder and you give a proxy, you may revoke it at any time before it is exercised by doing any one of the following:

•        you may send another proxy card with a later date;

•        you may notify 10X Capital’s secretary, in writing, before the Special Meeting that you have revoked your proxy; or

•        you may attend the Special Meeting, revoke your proxy, and vote virtually, as indicated above.

Who Can Answer Your Questions About Voting Your Shares

If you are a stockholder and have any questions about how to vote or direct a vote in respect of your shares of 10X Capital Common Stock, you may call Morrow Sodali LLC, 10X Capital’s proxy solicitor, at (800) 662-5200 or banks and brokers can call collect at (203) 658-9400.

Redemption Rights

Holders of Public Shares may seek to have their shares redeemed for cash, regardless of whether they vote for or against the Merger Proposal. Any stockholder holding Public Shares as of the record date may demand that 10X Capital redeem such shares into a full pro rata portion of the Trust Account (which was $10 per share as of June 2, 2021, the record date), calculated as of two business days prior to the anticipated consummation of the Merger. If a holder properly seeks redemption as described in this section and the Merger is consummated, 10X Capital will redeem these shares for a pro rata portion of funds deposited in the Trust Account and the holder will no longer own these shares. A holder of Public Shares, together with any affiliate of such holder and any person with whom such holder is acting in concert or as a “group” (as defined under Section 13(d)(3) of the Exchange Act) may not seek to have more than 20% of the aggregate Public Shares redeemed without the consent of 10X Capital.

The Sponsor and 10X Capital’s officers and directors will not have redemption rights with respect to any shares of 10X Capital Common Stock owned by them, directly or indirectly.

Holders demanding redemption are also required to (A) submit their redemption request, which includes the name of the beneficial owner of the Public Shares to be redeemed, in writing to Continental Stock Transfer & Trust Company, 10X Capital’s transfer agent and (B) deliver their stock, either physically or electronically using DTC’s DWAC System, to 10X Capital’s transfer agent no later than 5:00 pm Eastern time on             , 2021 (two (2) business days prior to the Special Meeting). If you hold the shares in street name, you will have to coordinate with your broker to have your shares certificated or delivered electronically. Shares represented by certificates that have not been tendered (either physically or electronically) in accordance with these procedures will not be redeemed for cash. There is a nominal cost associated with this tendering process and the act of certificating the shares or delivering them through the DWAC system. The transfer agent will typically charge the tendering broker $45 and it would be up to the broker whether or not to pass this cost on to the redeeming stockholder. In the event the proposed Merger is not consummated this may result in an additional cost to stockholders for the return of their shares.

Any request to have Public Shares redeemed, once made, may be withdrawn at any time up to the vote on the Merger Proposal, but only with the consent of 10X Capital. If a holder of Public Shares delivers Public Shares for redemption and later decides prior to the Special Meeting not to elect redemption, such holder may request that 10X Capital consent to the return of such shares to such holder. Such a request must be made by contacting Continental Stock Transfer & Trust Company, 10X Capital’s transfer agent, at the phone number or address set out elsewhere in this proxy statement/prospectus.

If the Merger is not approved or completed for any reason, then Public Stockholders who elected to exercise their redemption rights will not be entitled to have their shares redeemed. 10X Capital will thereafter promptly return any shares delivered by Public Stockholders. In such case, Public Stockholders may only share in the assets of the Trust Account upon the liquidation of 10X Capital. This may result in Public Stockholders receiving less than they would have received if the Merger was completed and they had exercised redemption rights in connection therewith due to potential claims of creditors.

The closing price of 10X Capital Class A Common Stock on the record date was $9.91. The cash held in the Trust Account on such date was approximately $201.3 million (approximately $10 per public share). Prior to exercising redemption rights, Public Stockholders should verify the market price of 10X Capital Class A Common Stock as they may receive higher proceeds from the sale of their shares of 10X Capital Class A Common Stock in the public market than from exercising their redemption rights if the market price per share is higher than the redemption price. 10X Capital cannot assure its stockholders that they will be able to sell their shares of 10X Capital Class A Common Stock in the open market, even if the market price per share is higher than the redemption price stated above, as there may not be sufficient liquidity in its securities when its stockholders wish to sell their shares.

Appraisal Rights

None of the stockholders, Unit holders or warrant holders of 10X Capital have appraisal rights in connection the Merger under the DGCL.

Proxy Solicitation Costs

10X Capital is soliciting proxies on behalf of its board of directors. This solicitation is being made by mail but also may be made by telephone or in person. 10X Capital and its directors, officers and employees may also solicit proxies in person, by telephone or by other electronic means. 10X Capital will bear the cost of the solicitation.

10X Capital has hired Morrow Sodali LLC to assist in the proxy solicitation process, 10X Capital will pay a fee of $30,000, plus disbursements.

10X Capital will ask banks, brokers and other institutions, nominees and fiduciaries to forward the proxy materials to their principals and to obtain their authority to execute proxies and voting instructions. 10X Capital will reimburse them for their reasonable expenses.

PROPOSAL NO. 1 — THE MERGER PROPOSAL

General

Holders of 10X Capital Common Stock are being asked to adopt the Merger Agreement and approve the transactions contemplated thereby, including the Merger. 10X Capital stockholders should read carefully this proxy statement/prospectus in its entirety for more detailed information concerning the Merger Agreement, which is attached as Annex A to this proxy statement/prospectus. Please see the section entitled “— The Merger Agreement” below, for additional information and a summary of certain terms of the Merger Agreement. You are urged to read carefully the Merger Agreement in its entirety before voting on this proposal.

10X Capital may consummate the Merger only if it is approved by the affirmative vote of the holders of a majority of the issued and outstanding shares of 10X Capital Common Stock as of the record date for the Special Meeting.

General

Transaction Structure

The Merger Agreement provides for the merger of 10X Capital with and into Merger Sub, with 10X Capital surviving the Merger as a wholly-owned subsidiary of REE.

Pro Forma Capitalization

The pro forma equity valuation of REE upon consummation of the Merger is estimated to be approximately $3.6 billion. We estimate that at the Effective Time, in the No Redemption Scenario, the securityholders of REE will own approximately 84.1% of the outstanding REE Class A Ordinary Shares and the securityholders of 10X Capital, namely the Public Stockholders, the Sponsor and the PIPE Investors, will own the remaining REE Class A Ordinary Shares. In addition to the REE Class A Ordinary Shares held thereby, Daniel Barel and Ahishay Sardes, the founders of REE, will hold up to 83,432,817 REE Class B Ordinary Shares (subject to the assumptions described elsewhere in this registration statement), each of which has ten votes per share in matters presented to the REE shareholders for vote (including the election of directors), but which do not have any economic rights.

Merger Consideration

Immediately prior to the Effective Time, REE intends to effect a reverse stock split to cause the value of the outstanding REE Class A Ordinary Shares immediately prior to the Effective Time to equal $10.00 per share, based on the estimated pro forma equity valuation of REE of $3.6 billion (the “Stock Split”).

The Existing 10X Capital Charter provides that upon, and the Proposed Charter provides that immediately prior to, the occurrence of the Merger, each share of 10X Capital Class B Common Stock will convert into shares of 10X Capital Class A Common Stock on a one-to-one basis, subject to anti-dilution protection in respect of additional shares of 10X Capital Class A Common Stock issued in connection with the Merger (namely, the PIPE Shares to be issued to the PIPE Investors pursuant to the PIPE Subscription Agreements). Such anti-dilution protection may be waived in whole or in part by the holders of a majority of the outstanding shares of 10X Capital Class B Common Stock. The Sponsor, as the holder of a majority of the outstanding shares of 10X Capital Class B Common Stock, has agreed with 10X Capital and REE to waive such anti-dilution protection to the extent that such anti-dilution protection would result in Sponsor receiving more than the 2,900,000 Anti-Dilution Shares.

At the Effective Time, pursuant to the Merger Agreement, each outstanding share of 10X Capital Class A Common Stock (including shares of 10X Capital Class A Common Stock issued upon conversion of the 10X Capital Class B Common Stock in connection with the Merger) will be converted into the right to receive 1.5763975 newly issued REE Class A Ordinary Share, and each of 10X Capital’s outstanding warrants to purchase one share of 10X Capital Class A Common Stock will be converted into the right to receive an equal number of warrants to purchase one REE Class A Ordinary Share, subject to downward adjustment to the next whole number in case of fractions of REE Warrants.

Adjustments to Merger Consideration

Up to 1,500,000 of the 2,900,000 Anti-Dilution Shares are subject to subsequent forfeiture without consideration as follows: (i) 1,500,000 Anti-Dilution Shares will be forfeited if the volume weighted average price at which the REE Class A Ordinary Shares trade during the course of the first day on which such shares trade on the Nasdaq Stock Market exchange following the Merger (the “First Trading Day Price”) is less than $13.00, (ii) 1,000,000 Anti-Dilution Shares will be forfeited if the First Trading Day Price equals or exceeds $13.00 but is less than $16.00, (iii) 500,000 Anti-Dilution Shares will be forfeited if the First Trading Day Price equals or exceeds $16.00 but is less than $20.00, and (iv) zero Anti-Dilution Shares will be forfeited if the First Trading Day Price equals or exceeds $20.00.

Background of the Merger

The following is a discussion of 10X Capital’s formation, the background of 10X Capital’s efforts to effect an initial business combination, its negotiations with and evaluation of REE, the Merger Agreement and related matters.

10X Capital is a blank check company formed on August 10, 2020 for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. 10X Capital’s efforts to identify a prospective target business were not limited to any particular industry or geographic region although it focused its search for target businesses to those that operated in the technology sector. The Merger with REE is a result of a thorough search for a potential transaction using the extensive network and investing and operating experience of 10X Capital’s management team and board of directors. The terms of the Merger Agreement are the result of arm’s-length negotiations between representatives of 10X Capital and REE.

On November 27, 2020, 10X Capital completed its IPO of 20,125,000 Units (including 2,625,000 Units sold upon the exercise in full of the underwriters’ over-allotment option on December 18, 2020), each Unit consisting of one share of 10X Capital Class A Common Stock and one-half of one Public Warrant to purchase one share of 10X Capital Class A Common Stock, generating gross proceeds of $201,250,000 (before underwriting discounts and commissions and offering expenses). Simultaneously with the IPO, 10X Capital consummated a private placement of 5,500,000 Private Warrants to the Sponsor, generating total proceeds of $5,500,000. A total of $201,250,500 from the net proceeds of the IPO and the issuance of the Private Warrants were placed in the Trust Account. Wells Fargo Securities, LLC was the IPO underwriter.

Except for a portion of the interest earned on the funds held in the Trust Account that may be released to 10X Capital to pay taxes, none of the funds held in the Trust Account will be released until the earliest to occur of (a) the completion of an initial business combination, (b) the redemption of any Public Shares properly submitted in connection with a stockholder vote to amend 10X Capital’s amended and restated certificate of incorporation (i) to modify the substance or timing of 10X Capital’s obligation to redeem 100% of the Public Shares if 10X Capital does not complete an initial business combination by May 27, 2022, or (ii) with respect to any other provision relating to stockholders’ rights or pre-business combination activity, and (c) the redemption of the Public Shares if 10X Capital is unable to complete an initial business combination by May 27, 2022, subject to applicable law.

Prior to the consummation of the IPO, neither 10X Capital, nor anyone on its behalf, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a transaction with 10X Capital.

From the date of the IPO through execution of the Merger Agreement on February 3, 2021 and subject to the exclusivity described below, 10X Capital’s management team considered a number of potential target companies with the objective of consummating an acquisition. Representatives of 10X Capital contacted and were contacted by a number of individuals and entities who offered to present ideas for acquisition opportunities, including financial advisors and companies within the technology and transportation sectors. 10X Capital’s management team compiled a list of high priority potential targets and updated and supplemented such list from time to time.

During that period and subject to the exclusivity described below, 10X Capital’s management team and representatives of 10X Capital:

•        Identified and evaluated over 49 potential acquisition target companies;

•        Completed meaningful reviews and had substantive discussions with 14 companies that were considered by 10X Capital’s management team to be appropriate targets (including REE), of which six were in the transportation sector and four were EV companies;

•        Entered into non-disclosure agreements (“NDAs”), containing customary terms regarding confidentiality, without imposing exclusivity or other similar restrictions, with eight companies that 10X Capital’s management team considered to be appropriate targets (including REE), to facilitate due diligence review of confidential materials from these companies; and

•        Negotiated and executed a non-binding letter of intent with REE in December 2020.

Representatives of 10X Capital engaged in significant due diligence and detailed discussions directly with the Founders and senior executives of REE prior to executing the non-binding letter of intent.

10X Capital’s management team reviewed the potential acquisitions based on the same criteria discussed below and used in evaluating the Merger, which included the following, as disclosed in 10X Capital’s IPO prospectus:

•        Public company-ready.    10X Capital believed REE was remarkably well-prepared for an initial public offering of its equity or acquisition by a special purpose acquisition company, with well-developed corporate governance, financial controls and reporting policies already in place. Further, REE had already engaged accounting advisors to prepare PCAOB-standard audited financials, which were anticipated to be ready for the purposes of filing a Registration Statement on Form F-4 without significant lag time. REE’s readiness to enter the public markets on an accelerated timeframe compared to other potential targets was a key factor in 10X Capital’s analysis of the potential viability of a business combination with REE.

•        Strong value proposition for public investors.    Given multiple well-received EV special purpose acquisition company deals that have been announced during 2020 and 2021, 10X Capital believed that a business combination with REE would resonate thematically with public markets investors. 10X Capital determined that REE’s attractive valuation in relation to those comparable entities provided an attractive entry point to the EV ecosystem. Given the lack of borrowed debt on REE’s balance sheet, and the attractiveness of the EV sector, as evidenced by the recent positive reception of such sector in the capital markets, 10X Capital concluded that REE would present a strong value proposition for public investors.

•        Expansion potential.    10X Capital believes that REE’s modular platform technology, covering a variety of vehicle weight classes, together with its expanding global footprint, positions REE to take advantage of the cash accreting to the REE balance sheet through the Merger to grow and expand REE’s business model.

•        Differentiated product or service.    REE offers a highly differentiated, extensively patented solution, which demonstrates clear competitive advantages over competing electric vehicle drivetrain, platform and by-wire solutions, including conventional “skateboards” and in-wheel/hub motor technology. REEplatforms have novel drivetrain, which allows for more flexibility in design since REE-based vehicles do not have in-wheel or hub motors and have a substantially lower center of gravity than a typical skateboard that enables REE-based vehicles to be taller, allowing the REE-based vehicles to carry significantly more packages than competitors, along with the ability for rapid repair or replacement of REEcorners, thereby significantly improving key fleet operator metrics such as total cost of ownership and service uptime/downtime. This is clearly evidenced by the strategic collaborations and investments that REE has secured to date.

•        Experienced management team,    REE’s management team is highly experienced in automotive, engineering and serial entrepreneurship. See the section of this proxy statement/prospectus entitled “Management of REE Following the Merger — Executive Officers.”

10X Capital and its advisors determined that the other alternative business combination targets were less suitable than REE when taking into account their respective management teams, strategies, business prospects, valuations and likelihood of execution. For additional details about the 10X Capital board of director’s reasons for approving the Merger, see the section of this proxy statement/prospectus entitled “— The 10X Capital Board of Directors’ Reasons for the Approval of the Merger.”

Timeline of the Merger

Mr. Thomas was introduced to Daniel Barel, co-founder and Chief Executive Officer, and Hai Aviv, Chief Financial Officer, of REE by an investor in the Sponsor in early December 2020. On December 6, 2020, Messrs. Thomas, Barel and Aviv participated in an introductory videoconference, during which 10X Capital provided REE with an overview of

10X Capital and its goals in selecting an acquisition target. Messrs. Barel and Aviv provided a high-level introduction to REECorner technology and displayed videos showcasing the technology in action as integrated into multiple REEPlatforms. REE provided a high-level review of its publicly disclosed commercial agreements, as well as its strategic partners and investors. Mr. Aviv advised that REE’s 2018 and 2019 PCAOB-standard audited financials were largely complete. The teams discussed REE’s desire to raise up to $500 million in total, and discussed potential PIPE strategies.

Shortly after the introductory videoconference, on December 7, 2020, 10X Capital and REE began negotiation of a non-disclosure agreement, including a waiver by REE of any claims against the 10X Capital trust account. The non-disclosure agreement was executed by both parties on December 8, 2020. After execution of the non-disclosure agreement, 10X Capital received access to a data room containing confidential REE materials on December 9, 2020.

On December 9, 2020, the executive officers of 10X Capital, consisting of Messrs. Thomas, Weisburd, Kandasamy and Wriedt, participated in a videoconference with members of REE management, Messrs. Barel and Aviv and Ahishay Sardes, co-Founder and Chief Technology Officer, and with representatives from Cowen & Co., a financial advisor to REE (“Cowen”), to discuss the strategic prospects of a potential business combination. REE’s team clarified the performance and competitive advantages of its REECorner technology and demonstrated differentiating characteristics of REE’s technology as compared to in-wheel or hub motors with respect to unsprung mass or propensity to sustain damage. The REE team further described that REEPlatforms have significant advantages over conventional EV “skateboard” designs enabled by the novel drivetrain, including more flexibility in design since REE-based vehicles do not have in-wheel or hub motors, a substantially lower center of gravity than a typical skateboard that enables REE-based vehicles to be taller, allowing the REE-based vehicles to carry significantly more packages than competitors, along with the ability for the rapid repair or replacement of REECorners, thereby significantly improving key fleet operator metrics such as total cost of ownership and service uptime/downtime. The REE team also discussed the progress of REE’s existing strategic collaborations with customers and its progress toward definitive agreements. The teams also discussed recent comparable industry transactions. Mr. Aviv clarified REE’s financial projections, including but not limited to the use of signed strategic collaborations and initial discussions with potential strategic partners for the computation of revenue projections.

Subsequent to the videoconference on December 9, 2020, Messrs. Barel and Thomas exchanged emails and phone calls regarding REE’s priority deal terms, which included, but were not limited to, use of a valuation methodology based on projected revenues, similar to the methodology used in recent comparable transactions; the ability to market and build a PIPE transaction with the goal of raising up to $500 million in total between the amount held in trust and the PIPE transaction; an alignment of earn-outs between the Sponsor and REE management; the employment of a dual class voting structure; and timely execution of the transaction.

On December 10, 2020, members of 10X Capital’s management team held a videoconference with Mr. Barel and a strategic investor and advisor to REE to gain insight into REE’s technology compared to existing alternatives and competitors, the value of certain key strategic partners and investors, the nature of REE’s strategic collaborations and agreements with its customers and how those strategic collaborations and agreements compared to other strategic collaborations, agreements and orders referenced in the marketing of other recent transactions in the mobility space.

On December 12, 2020, Messrs. Thomas and Weisburd participated in a videoconference with representatives of Cowen to discuss potential terms for a business combination with REE, including the potential valuation of REE, Cowen’s view on REE’s commercial agreements and Cowen’s experience in the EV market.

On December 13 and 14, 2021, Messrs. Thomas and Barel participated in multiple calls discussing key terms with the goal of producing a draft of a non-binding letter of intent between the parties. Key terms discussed included, but were not limited to, valuation of REE, with REE suggesting a valuation near $3.5 billion, and 10X Capital arguing for a lower valuation with the goal of providing a significant discount to recent comparable transactions and an attractive entry point for new investors; PIPE sizing, where 10X Capital advocated for a flexible approach starting at an amount that would fully fund the business plan and allow for upsizing in the event of oversubscription; REE’s ability to secure board approval for the proposed dual class share structure; and REE’s desire for a period of mutual exclusivity.

On December 15, 2020, 10X Capital submitted a proposed non-binding letter of intent to REE by email, detailing the proposed terms of a business combination between the parties. The letter of intent valued REE at $3.0 billion and proposed consideration consisting of only newly-issued shares of 10X Capital Common Stock. The letter of intent also contemplated 10X Capital raising $225 million in a PIPE transaction, with an option of increasing the size of the PIPE to $325 million, outlined a mechanism for a dual class stock structure, and provided for a period of exclusivity.

On December 16, 2020, REE proposed revisions to the non-binding letter of intent via email, including a minimum cash requirement of $300 million, which REE could waive, a proposal to exclude unvested shares or equity awards from the valuation, a provision for 10X Capital to appoint one or two directors to the post-transaction company depending on the overall size and composition of the board of directors and changes to the proposed lock-up and earnout structure. The revisions also outlined the structure of the business combination, whereby REE would become the publicly-traded company and a statement that REE and 10X Capital would work together in good faith to refine the potential business combination structure. 10X Capital management participated in two videoconferences with REE management and financial advisors from Cowen to discuss key deal terms. REE agreed that its shareholders would roll over 100% of their equity, and be subjected to certain lock-up provisions. REE also agreed that the minimum cash condition would be $225 million. 10X Capital agreed to restructure and realign its Sponsor economics with REE insiders, such that all Sponsor Shares would be subjected to a lock-up, and the majority of the Sponsor economics would be subjected to the same lock-ups and earnouts as REE’s management and board. The parties also agreed to reduce the minimum cash requirement to approximately the expected amount of the PIPE financing to provide greater certainty of consummating the Merger.

On December 18, 2020, 10X Capital submitted further proposed revisions to the non-binding letter of intent to REE, reflecting changes proposed during videoconferences with Morgan, Lewis & Bockius LLP (“Morgan Lewis”), 10X Capital’s external counsel, and tax advisors. The revisions deleted the proposed structure, whereby REE would become the publicly traded company, and kept the statement that REE and 10X Capital would work together in good faith to refine the potential business combination structure.

During negotiation of the key deal terms and the non-binding letter of intent, 10X Capital and its advisors continued to conduct business and financial due diligence reviews of REE’s business and financial position, including conducting calls with key customers and strategic partners as well as industry experts and advisors with knowledge of the industry.

On December 18, 2020, Messrs. Thomas and Kandasamy participated in a videoconference with Mr. Aviv, representatives from 10X Capital’s counsel from Morgan Lewis and REE’s counsel from White & Case LLP (“White & Case”) to discuss the structuring of cross-border transactions and potential structuring solutions for the potential business combination, including a “double-dummy” structure involving a newly formed parent entity organized under the laws of Israel as well as a structure by which REE would become the publicly traded company.

On December 19, 2020, REE proposed further revisions to the non-binding letter of intent via email, including with respect to the structure of the business combination and REE becoming the publicly-traded company and exclusion of unvested equity awards up to a certain level.

On December 20, 2020, representatives of 10X Capital submitted further proposed revisions to the non-binding letter of intent to 10X Capital by email, including a proposal for prolonged mutual exclusivity as well as inclusion of all equity awards in the valuation of REE. The revisions deleted the proposed structure, whereby REE would become the publicly traded company, and added back the statement that REE and 10X Capital would work together in good faith to refine the potential business combination structure.

On December 20, 2020, Messrs. Thomas and Kandasamy participated in a videoconference with Mr. Aviv, tax and corporate counsel from Morgan Lewis, corporate counsel from White & Case and tax advisors from EY Israel.

10X Capital and REE executed a non-binding letter of intent with respect to the Merger on December 22, 2020. The executed letter of intent valued REE at $3.0 billion, with anticipated total gross proceeds of the PIPE and Trust Account of $425 million, an option to upsize the PIPE for a total of up to $525 million in total gross proceeds, a minimum cash condition of $225 million, the lock-up and earnout structures for REE shareholders, management and directors and 10X Capital founder shareholders, and a period of exclusivity through January 31, 2021. The letter of intent included a statement that REE and 10X Capital would work together in good faith to refine the potential business combination structure.

On December 21, 2020, 10X Capital engaged Gornitzky & Co. (“Gornitzky”) as Israeli corporate and tax counsel to assess Israeli law issues, liaise with the Israel Tax Authority and perform additional due diligence investigation of REE, including background checks of REE’s co-founders Messrs. Barel and Sardes.

On December 22, 2020, Mr. Thomas held a videoconference with Cowen regarding a potential engagement as a placement agent for the sale of shares to the PIPE Investors.

On December 22, 2020, Messrs. Thomas, Weisburd and Kandasamy met with Mr. Barel and Keren Shemesh, Chief Marketing Officer of REE, to discuss a press strategy with respect to the Merger.

On December 23, 2020, 10X Capital engaged Frost & Sullivan, an independent research and consulting firm with expertise in engineering and the automotive industry, including the EV sector, to perform an additional business and operational due diligence investigation of REE, to perform interviews with REE’s technical and business staff and to perform in-person, on-site physical inspections of REE’s facility and technology in Israel on behalf of 10X Capital.

On December 23, 2020, the 10X Capital management team held a videoconference with equity capital markets and transportation investment banking professionals from Morgan Stanley regarding the engagement of Morgan Stanley to serve as lead placement agent for the sale of shares to the PIPE Investors, in addition to Cowen, due to Morgan Stanley’s strength in the transportation sector and potential targeting strategies.

On December 27, 2020, the 10X Capital management team participated in a videoconference with the Morgan Stanley PIPE placement agent team to set a schedule for investor targeting and review initial investor materials.

On December 28, 2020, Mr. Thomas held a videoconference introducing Marc Silverberg of ICR Inc., an investment relations professional specializing in the Energy Technology sector, to Mr. Barel and Ms. Shemesh of REE to discuss investor relations strategy.

On December 28, 2020, the 10X Capital management team, joined by Chris Jurasek, a member of the 10X Capital board of directors, held a videoconference with the members of the Morgan Stanley PIPE placement agent team to review business and financial due diligence regarding REE.

On December 29, 2020, Messrs. Thomas, Weisburd and Kandasamy participated in a videoconference with Mr. Barel and Ms. Shemesh of REE to discuss the proposed PIPE investor presentation.

On December 29, 2020, Messrs. Thomas and Kandasamy participated in a videoconference with tax counsel from Morgan Lewis and Gornitzky regarding Israeli tax issues.

On December 30, 2020, the 10X Capital management team, Mr. Jurasek, Messrs. Barel and Aviv of REE and the teams at Morgan Stanley and Cowen participated in a videoconference run-through of the proposed presentation to PIPE Investors by Messrs. Thomas, Barel and Aviv.

On December 30, 2020, Mr. Thomas and Messrs. Barel and Aviv of REE participated in a videoconference discussion of investor relations strategy and proposed timeline with members of the ICR Inc. strategic communications team.

On January 2, 2021, the 10X Capital management team, Mr. Jurasek and Messrs. Barel and Aviv of REE participated in a videoconference drafting session of the PIPE investor presentation with Morgan Stanley and Cowen.

On January 3, 2021, the management teams of 10X Capital and REE, legal counsel from Morgan Lewis, White & Case, Latham & Watkins LLP, counsel to Morgan Stanley and Cowen, and advisors from EY Israel, participated in a videoconference led by Morgan Stanley and Cowen regarding legal and financial due diligence findings on REE.

On January 4, 2021, Messrs. Thomas and Wriedt participated in a videoconference with Morgan Stanley and Cowen regarding investor targeting strategy for the PIPE transaction.

On January 7, 2021, 10X Capital and each of Morgan Stanley and Cowen executed engagement letters pursuant to which Morgan Stanley and Cowen were engaged as placement agents for the PIPE transaction. Later that day, Morgan Stanley and Cowen began the process of wall-crossing investors for initial meetings with respect to the PIPE transaction and the related data room was opened to investors.

On January 7, 2021, Morgan Stanley presented a dry run of the PIPE investor presentation to the management teams of 10X Capital and REE for review and comment, subsequently updating the presentation as necessary. This process was repeated among the parties on January 9, 2021.

On January 13, 2021, the parties and the PIPE placement agents began the PIPE roadshow, which lasted through January 26, 2021. Indications of interest were due to Morgan Stanley and Cowen by January 28, 2021.

From January 11, 2021 through January 21, 2021, 10X Capital, REE and Morgan Stanley, with the assistance of counsel, negotiated the terms of the PIPE Subscription Agreement. On January 21, 2021, the form of PIPE Subscription Agreement agreed upon by 10X Capital, REE and Morgan Stanley was provided to potential investors in the PIPE data room. Thereafter until February 2, 2021, 10X Capital, REE and Morgan Stanley negotiated the final terms of the Subscription Agreement with the PIPE Investors in response to comments therefrom.

On January 23, 2021, REE provided access to a due diligence data room prepared by REE, and legal and accounting representatives of 10X Capital and REE met by videoconference to discuss potential deal structures, which videoconferences were continued on January 24, 2021.

On January 26, 2021, Morgan Lewis sent to White & Case drafts of the Merger Agreement and certain ancillary agreements, reflecting a “double-dummy” transaction structure involving a newly formed parent entity organized under the laws of Israel.

On January 27, 2021, representatives of 10X Capital and REE met to discuss transaction structures and potential outcomes, including the possibility of structuring the transaction whereby REE would become the publicly traded company, and the waiver by the Sponsor of its right to receive anti-dilution shares in excess of 2,900,000 under the 10X Capital certificate of incorporation.

On January 28, 2021, White & Case delivered to Morgan Lewis a revised draft of the Merger Agreement reflecting a transaction structure whereby REE would be the parent company following the Merger.

On January 29, 2021, the parties exchanged drafts of various ancillary agreements and disclosure schedules.

On January 30, 2021, Morgan Lewis delivered a revised draft of the Merger Agreement to White & Case adding certain customary closing deliverables, expanding certain representations and warranties, including in respect of REE’s internal controls and business operations and certain Israel-specific matters, expanding certain covenants related to the conduct of the REE business between signing and closing, inserting the ability of the board of directors of 10X Capital to change its recommendation in favor of the merger if the failure to do so would constitute a breach of such directors’ fiduciary obligations to the stockholders of 10X Capital, making the consummation of the PIPE Investment and the minimum cash amount condition mutual conditions to the consummation of the business combination, and inserting termination rights if REE failed to timely deliver support agreements from its stockholders or PCAOB-audited financials within certain specified time periods.

On January 31, 2021, the parties exchanged subsequent drafts of ancillary agreements and disclosure schedules, White & Case delivered an updated draft of the Merger Agreement to Morgan Lewis, and the parties held several all-hands calls to discuss deal terms and material open matters to attempt to resolve the same. The White & Case draft Merger Agreement deleted the requirement for REE to certify to its transaction expenses, added certain “material adverse effect” qualifiers to certain representations and warranties, and limited the ability of the 10X Capital board of directors to change its recommendation to situations where such a change would be required by applicable law. Following such all-hands calls, White & Case delivered an updated draft of the Merger Agreement to Morgan Lewis reflecting the discussion of the parties, including adding back a REE certification of estimated transaction expenses, and adding certain financial statement, intellectual property and tax disclosures.

On February 1, 2021, Mr. Thomas held a videoconference with Mr. Barel and Mike Charlton, Chief Operating Officer of REE, to undertake further diligence inquiries with respect to REE. Subsequent to the diligence call, on February 1, 2021, the management of 10X Capital and REE participated in a videoconference with Morgan Stanley and Cowen on which allocations among the PIPE Investors were finalized and, due to meaningful oversubscription, a determination was made to increase the size of the PIPE transaction to $300 million. Also on this date, Morgan Lewis delivered an updated draft of the Merger Agreement to White & Case, clarifying certain tax and intellectual property representations and making conforming and clean-up changes, and White & Case delivered a response markup of the Merger Agreement to Morgan Lewis, making further clean-up changes, clarifying the timing of payment of certain transaction expenses, and proposing changes to certain tax representations. The parties also continued to work to finalize various exhibits and disclosure schedules.

After the determination to increase the size of the PIPE transaction, the full board of directors of 10X Capital met via videoconference to approve entry into the Merger Agreement. Messrs. Thomas and Weisburd presented details of the Merger on behalf of the management team. Prior to the vote to approve the Merger, management provided each board member with a draft of the due diligence report prepared by Frost & Sullivan for their review. The board reviewed a presentation prepared by REE regarding its business, as well as the key terms of the Merger Agreement. Questions were asked and answered, and the board confirmed that REE met the criteria set forth for an acquisition target in 10X Capital’s governing documents.

Further on February 2, 2021, the full board of directors of REE met again via videoconference to approve entry into the Merger Agreement. Representatives of White & Case reviewed again for the REE board of directors the material

terms of the proposed transaction and highlighted changes implemented since the previous meeting. Questions were asked and answered, following which the REE board of directors approved the entry into the Merger Agreement and the transactions contemplated thereby.

On February 2, 2021, Morgan Lewis and White & Case worked together to finalize the Merger Agreement and the various ancillary agreements and disclosure schedules.

The Merger Agreement, the PIPE Subscription Agreements and other related transaction documents were signed prior to the market open on February 3, 2021, Eastern Standard Time. Prior to the market open on such date, 10X Capital and REE issued a joint press release announcing the signing of the Merger Agreement. An investor webcast and call was held at 8:00 a.m. Eastern time and 10X Capital filed a Current Report on Form 8-K describing the material terms of the Merger Agreement. The press release, investor call script and webcast presentation were furnished as exhibits to such Current Report on Form 8-K. On February 5, 2021, 10X Capital filed an amendment to its previously filed Current Report on Form 8-K/A to furnish the remaining exhibits thereto.

The parties have continued and expect to continue regular discussions in connection with, and to facilitate, the closing of the Merger.

The 10X Capital Board of Directors’ Reasons for the Approval of the Merger

On February 1, 2021, the 10X Capital board of directors unanimously (i) approved the Merger Agreement and the transactions contemplated thereby, (ii) determined that the Merger is advisable and fair to and in the best interests of 10X Capital and its stockholders and (iii) recommended that 10X Capital’s stockholders approve the Merger Proposal and the other proposals described herein.

In evaluating the Merger and making these determinations and this recommendation, the 10X Capital board of directors consulted with 10X Capital’s management and with Morgan, Lewis & Bockius LLP and Gornitzky & Co., and considered a number of factors, including, but not limited to, the factors discussed below. In light of the wide number and complexity of the factors considered in connection with its evaluation of the Merger, the 10X Capital board of directors did not consider it practicable to, and did not attempt to, quantify or otherwise assign relative weights to the specific factors that it considered in reaching its determination and supporting its decision. The 10X Capital board of directors viewed its decision as being based on all of the information available and the factors presented to and considered by it. In addition, individual directors may have given different weight to different factors. This explanation of the 10X Capital board of directors’ reasons for the Merger and all other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors discussed under “Forward-Looking Statements.”

The 10X Capital board of directors considered a number of factors pertaining to the Merger as generally supporting its decision to approve the entry into the Merger Agreement and the transactions contemplated thereby, including but not limited to, the following material factors:

•        Strong value proposition for public investors;

•        Expansion potential;

•        Public company-ready;

•        Differentiated product or service; and

•        Experienced management team.

The 10X Capital board of directors determined that REE met all of the above criteria. In particular, the 10X Capital board considered the following positive factors, although not weighted or in any order of significance:

•        Public company-ready.    10X Capital believed REE was remarkably well-prepared for an initial public offering of its equity or acquisition by a special purpose acquisition company, with well-developed corporate governance, financial controls and reporting policies already in place. Further, REE had already engaged accounting advisors to prepare PCAOB-standard audited financials, which were anticipated to be ready for the purposes of filing a Registration Statement on Form F-4 without significant lag time. REE’s readiness to enter the public markets on an accelerated timeframe compared to other potential targets was a key factor in 10X Capital’s analysis of the potential viability of a business combination with REE.

•        Strong value proposition for public investors.    Given multiple well-received EV special purpose acquisition company deals that have been announced during 2020, 10X Capital believes that a business combination with REE would resonate thematically with public markets investors. 10X Capital determined that REE’s attractive valuation in relation to those comparable entities provided an attractive entry point to the EV ecosystem. Given the lack of borrowed debt on REE’s balance sheet, and the attractiveness of the EV sector, as evidenced by the recent positive reception of such sector in the capital markets, 10X Capital concluded that REE would present a strong value proposition for public investors.

•        Expansion potential.    10X Capital believes that REE’s modular platform technology, covering a variety of vehicle weight classes, together with its expanding global footprint, positions REE to take advantage of the cash accreting to the REE balance sheet through the Merger to grow and expand REE’s business model.

•        Differentiated product or service.    REE offers a highly differentiated, extensively patented solution, which demonstrates clear competitive advantages over competing electric vehicle drivetrain, platform and by-wire solutions, including conventional “skateboards” and in-wheel/hub motor technology. This is clearly evidenced by the strategic collaborations and, investments that REE has secured to date.

•        Experienced management team:    REE’s management team is highly experienced in automotive, engineering and serial entrepreneurship.

In considering the potential business combination with REE, the 10X Capital board gave consideration to the following negative factors, although not weighted or in any order of significance:

•        10X Capital’s Public Stockholders will hold a minority share position in REE following the Merger.

•        10X Capital’s stockholders may object to and challenge the Merger and take actions that may prevent or delay the consummation of the Merger, including to vote down the proposals at the Special Meeting or exercise their redemption rights.

•        The potential for diversion of management and employee attention during the period prior to completion of the Merger, and the potential negative effects on REE’s business.

•        The risk that, despite the efforts of 10X Capital and REE prior to the consummation of the Merger, REE may lose key personnel, and the potential resulting negative effects on REE’s business.

•        The possibility that REE might not achieve its projected financial results.

•        The risks associated with macroeconomic uncertainty, including as it relates to COVID-19, and the effects it could have on REE’s business.

•        The risk that 10X Capital does not obtain the proceeds of the PIPE Investment resulting in 10X Capital being unable to retain sufficient cash in the Trust Account to meet the requirements of the Merger Agreement.

•        The Merger Agreement prohibits 10X Capital from soliciting or engaging in discussions regarding alternative transactions during the pendency of the Merger.

•        Risks and costs to 10X Capital if the Merger is not completed, including the risk of liquidation.

•        10X Capital did not obtain a third-party valuation or fairness opinion in connection with the Merger.

•        Potential changes in the regulatory landscape or new industry developments, including changes in client preferences, may adversely affect the business benefits anticipated to result from the Merger.

•        Risks of the type and nature described under the section entitled “Risk Factors” beginning on page 33.

The foregoing discussion of material factors considered by the 10X Capital board of directors is not intended to be exhaustive but does set forth the principal factors considered.

The 10X Capital board of directors also considered whether members of 10X Capital’s management and board of directors may have interests in the Merger that are different from, or are in addition to, the interests of 10X Capital’s stockholders generally, including the matters described under the subsection entitled “— Interests of 10X Capital’s

Directors and Officers in the Merger” below. However, the 10X Capital board of directors concluded that (i) these interests were disclosed in the 10X Capital IPO prospectus and are included in this proxy statement/prospectus, (ii) these disparate interests would exist with respect to a business combination with any target company, (iii) 10X Capital’s stockholders will have the opportunity to redeem their Public Shares in connection with the Merger and (iv) shares of REE held by 10X Capital’s officers, directors and other initial stockholders, as well as certain shareholders of REE are subject to transfer restrictions following the Merger. See the section entitled “— Related Agreements — Investors’ Rights Agreement” above for a description of these transfer restrictions.

Certain Unaudited Prospective Financial Information of REE

REE does not as a matter of course make public projections as to future revenues, performance, financial condition or other results. However, REE’s management prepared and provided to its board of directors, its financial advisors and 10X Capital certain internal, unaudited prospective financial information in connection with the evaluation of the Merger. REE’s management prepared such financial information based on their judgment and assumptions regarding the future financial performance of REE. The inclusion of the below information should not be regarded as an indication that REE or any other recipient of this information considered — or now considers — it to be necessarily predictive of actual future results.

The unaudited prospective financial information is subjective in many respects. As a result, there can be no assurance that the prospective results will be realized or that actual results will not be significantly higher or lower than estimated. Since the unaudited prospective financial information covers multiple years, that information by its nature becomes less predictive with each successive year.

While presented in this proxy statement/prospectus with numeric specificity, the information set forth in the summary below was based on numerous variables and assumptions that are inherently uncertain and may be beyond the control of REE’s management, including, among other things, the matters described in the sections entitled “Forward-Looking Statements” and “Risk Factors.” REE believes the assumptions in the prospective financial information were reasonable at the time the financial information was prepared, given the information REE had at the time. However, important factors that may affect actual results and cause the results reflected in the prospective financial information not to be achieved include, among other things, risks and uncertainties relating to REE’s business, industry performance, the regulatory environment, and general business and economic conditions. The prospective financial information also reflects assumptions as to certain business decisions that are subject to change. The unaudited prospective financial information was not prepared with a view toward public disclosure or with a view toward complying with the guidelines established by the American Institute of Certified Public Accountants with respect to prospective financial information, but, in the view of REE’s management, was prepared on a reasonable basis, reflects the best currently available estimates and judgments, and presents, to the best of management’s knowledge and belief, the expected course of action and the expected future financial performance of REE. However, this information is not fact and should not be relied upon as being necessarily indicative of future results, and readers of this proxy statement/prospectus are cautioned not to place undue reliance on the prospective financial information.

Neither REE’s independent registered public accounting firm, nor any other independent accountants, have compiled, examined or performed any procedures with respect to the prospective financial information contained herein, nor have they expressed any opinion or any other form of assurance on such information or its achievability, and assume no responsibility for, and disclaim any association with, the prospective financial information. The audit reports included in this proxy statement/prospectus relate to historical financial information. They do not extend to the prospective financial information and should not be read to do so.

EXCEPT AS REQUIRED BY APPLICABLE SECURITIES LAWS, REE DOES NOT INTEND TO MAKE PUBLICLY AVAILABLE ANY UPDATE OR OTHER REVISION TO THE PROSPECTIVE FINANCIAL INFORMATION. THE PROSPECTIVE FINANCIAL INFORMATION DOES NOT TAKE INTO ACCOUNT ANY CIRCUMSTANCES OR EVENTS OCCURRING AFTER THE DATE THAT INFORMATION WAS PREPARED. READERS OF THIS PROXY STATEMENT/PROSPECTUS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THE UNAUDITED PROSPECTIVE FINANCIAL INFORMATION SET FORTH BELOW. NONE OF REE, 10X CAPITAL OR ANY OF THEIR RESPECTIVE AFFILIATES, OFFICERS, DIRECTORS, ADVISORS OR OTHER REPRESENTATIVES HAS MADE OR MAKES ANY REPRESENTATION TO ANY REE SHAREHOLDER, 10X CAPITAL STOCKHOLDER OR ANY OTHER PERSON REGARDING ULTIMATE PERFORMANCE COMPARED TO THE INFORMATION CONTAINED IN THE PROSPECTIVE FINANCIAL INFORMATION OR THAT FINANCIAL AND OPERATING RESULTS WILL BE ACHIEVED.

Certain of the measures included in the prospective financial information may be considered non-GAAP financial measures. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with U.S. GAAP, and non-GAAP financial measures as used by REE may not be comparable to similarly titled amounts used by other companies. Financial measures provided to a financial advisor in connection with a business combination transaction are excluded from the definition of non-GAAP financial measures and therefore are not subject to SEC rules regarding disclosures of non-GAAP financial measures, which would otherwise require a reconciliation of a non-GAAP financial measure to a U.S. GAAP financial measure. Accordingly, we have not provided a reconciliation of such financial measures.

The key elements of the REE projections assume the start of serial production in 2023. The following table sets forth certain summarized prospective financial information regarding REE for the period indicated:

____________

(1)      Earnings before interest, tax, depreciation and amortization.

We caution investors that amounts presented in accordance with our definition of EBITDA may not be comparable to similar measures disclosed by other issuers, because not all issuers calculate EBITDA in the same manner. EBITDA should not be considered as an alternative to net income (loss), cash flows from operating activities or any other performance measures derived in accordance with U.S. GAAP or as an alternative to cash flows from operating activities as a measure of our liquidity.

REE’s prospective financial information was prepared based on management’s assessment of projected unit sales and projected costs as follows:

•        As of April 15, 2021, REE had entered into six strategic collaborations, consisting of MOUs and strategic, alliance and development agreements with strategic partners, and was devoting employees or other company resources towards 10 additional programs with the potential to lead to a strategic collaboration. Since then, REE has signed additional strategic collaborations and initiated discussions with new potential strategic partners, while some of the others have been idle. REE’s projected revenue is based on projected unit sales of approximately 737,000 REE platforms through the end of 2026 from the 16 programs as of April 15, 2021, of which 260,000 units are from projected sales to strategic partners with which REE has entered into strategic collaborations. In calculating the number of projected units, REE’s management assessed the potential volumes, timing and selling prices for sales of platforms pursuant to each program between 2021 and 2026, taking into consideration factors such as the likelihood of sales, anticipated vehicle types, sizes and specifications required by counterparties, potential market penetration and potential global demand. As a general matter, unit sales assume the roll out of REE’s future integration centers locations, the production capacity of REE’s future integration centers, the selection of REE’s products by customers and growth in the various markets REE is targeting. Based on these assessments no single potential customer accounts for more than 16% of REE’s total projected units sales. Strategic collaborations are generally non-binding, and may be modified or canceled pursuant to their terms; however, the entry by REE into a strategic collaboration generally increases the confidence that REE’s management has in the likelihood of sales due to the very significant commitment of resources generally required to be invested by both parties to a strategic collaboration. While REE expects to be able to develop one or more of these existing agreements into definitive agreements for orders, there can be no guarantee that REE will be able to do so.

•        Projected gross profit is driven by the mix of products produced and sold in combination with corresponding costs. Due to our capex light model, over 90% of our total cost of goods sold relates to bill and material costs, assembly costs and manufacturing costs, with labor, logistics, warranties and other expenses accounting for less than 10%. REE does not currently have definitive supply agreements in place.

•        Research and development expenses are targeted to be between 8% and 12% of revenues in the medium term and selling, general and administrative expenses are targeted to be between 7% to 10% of revenues in the medium term. Key assumptions impacting profitability projections include costs of research and development in REE’s programs, and associated software development costs, including the cost of headcount, prototype vehicles, tooling and other third-party engineering. Further assumptions are made with regard to REE’s sales and general administration expenditures, including the costs related to headcount and third-party service providers.

•        Capital expenditure is based on a number of assumptions regarding the expenditure required to build REE’s future integration centers, including an initial set up cost of $15 million per integration center with 40,000 unit annual capacity, tooling costs estimated at 4% of the total costs of goods and the cost of machinery and other manufacturing and assembly equipment for an estimated 15 new integration centers.

In making the foregoing assumptions, REE’s management relied on a number of factors, including:

•        its experience in the automotive industry;

•        its experience in the period since the inception of the company and current pricing estimates for prototype vehicles and vehicle components;

•        its best estimates of the timing for the development and commercialization of its platform and overall platform development process;

•        its best estimates of current and future customers purchasing REE’s platform; and

•        third-party forecasts for industry growth.

For additional information regarding the assumptions underlying REE’s prospective financial information, see “Risk Factors — Risks Related to REE’s Business — REE’s projected financial information relies in large part upon internally developed assumptions and analyses, that if proven incorrect could result in significantly lower actual results” and “Risk Factors — Risks Related to REE’s Future Sales — Although REE has projected unit sales based on assessment of strategic collaborations and with the possibility of sales to potential partners, considering a range of assumptions, REE has not entered into any definitive purchase agreements with potential customers.”

Satisfaction of 80% Test

It is a requirement under the Existing 10X Capital Charter that any business acquired by 10X Capital have a fair market value equal to at least 80% of the balance of the funds in the Trust Account at the time of the execution of a definitive agreement for an initial business combination (excluding the deferred underwriting discount held in, and taxes payable on the income earned on, the Trust Account).

As of February 3, 2021, the date of the execution of the Merger Agreement, the balance of the funds in the Trust Account, less the items described above, was approximately $193.6 million and 80% thereof represents approximately $154.9 million. In reaching its conclusion on the 80% asset test, the 10X Capital board of directors used as a fair market value the $3.1 billion enterprise value for REE, which was implied based on the terms of the Merger agreed to by parties in negotiating the Merger Agreement. The parties to the Merger Agreement considered factors such as REE’s intellectual property and other assets, the future growth outlook and financial plan, as well as valuations and trading of publicly traded companies in similar and adjacent sectors.

The 10X Capital board of directors determined that the consideration being paid in the Merger, which amount was negotiated at arms-length, was fair to and in the best interests of 10X Capital and its stockholders and appropriately reflected REE’s value. The 10X Capital board of directors based this conclusion on a range of qualitative and quantitative factors such as REE’s market position, management experience, and future growth opportunities.

The 10X Capital board of directors believes that because of the financial skills and background of its directors, it was qualified to conclude that the acquisition of REE met the 80% requirement. Based on the fact that the $3.1 billion fair market value of REE as described above, is in excess of the threshold of approximately $154.9 million, representing 80% of the balance of the funds in the Trust Account (less the items described above), the 10X Capital board of directors determined that the fair market value of REE was substantially in excess of 80% of the funds in the Trust Account and that the 80% test was met.

Interests of 10X Capital’s Directors and Officers in the Merger

In considering the recommendation of the 10X Capital board of directors to vote in favor of approval of the Merger Proposal, stockholders should keep in mind that 10X Capital’s initial stockholders, including its directors and executive officers, have interests in such proposals that are different from, or in addition to, those of 10X Capital stockholders generally. In particular:

•        If the Merger with REE or another business combination is not consummated by May 27, 2022, 10X Capital will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding Public Shares for cash and, subject to the approval of its remaining stockholders and its board of directors, dissolving and liquidating. In such event, the 5,031,250 shares of 10X Capital Class B Common Stock held by 10X Capital’s initial stockholder, the Sponsor, which were acquired for an aggregate purchase price of $25,000 prior to 10X Capital’s IPO, would be worthless because 10X Capital’s initial stockholders are not entitled to participate in any redemption or distribution with respect to such shares. Such shares had an aggregate market value of $50.01 million based upon the closing price of $9.94 per share on the Nasdaq on May 28, 2021.

•        The Sponsor purchased an aggregate of 5,500,000 Private Warrants from 10X Capital for an aggregate purchase price of $5,500,000 (or $1.00 per Warrant). This purchase took place on a private placement basis simultaneously with the consummation of the IPO. A portion of the net proceeds of the IPO (including the net proceeds of the underwriters’ exercise of their over-allotment option) and the simultaneous private placement of the Private Warrants, a total of $201.25 million was placed in the Trust Account. Such Private Warrants had an aggregate market value of $9,130,000 based upon the closing price of $1.66 per Public Warrant on Nasdaq on May 28, 2021. Private Warrants will become worthless (as will the Public Warrants) if 10X Capital does not consummate an initial business combination by May 27, 2022.

•        The Merger Agreement provides that Hans Thomas, 10X Capital’s Chief Executive Officer and Chairman will become a director of REE. As such, in the future he may receive any cash fees, stock options or stock awards that the REE board of directors determines to pay to its directors.

•        If 10X Capital is unable to complete an initial business combination by May 27, 2022, the Sponsor will be liable to ensure that the proceeds in the Trust Account are not reduced by the claims of target business(es) or claims of vendors or other entities that are owed money by 10X Capital for services rendered or contracted for or products sold to 10X Capital, but only if such a vendor or target business has not executed a waiver.

•        The Sponsor, as 10X Capital’s initial stockholder, and its affiliates are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on 10X Capital’s behalf, such as identifying and investigating possible business targets and business combinations. However, if 10X Capital fails to consummate an initial business combination within the required period, they will not have any claim against the Trust Account for reimbursement. Accordingly, 10X Capital may not be able to reimburse these expenses if the Merger with REE or another business combination, is not completed by May 27, 2022. Since inception through May 14, 2021, such reimbursable expenses have totaled less than $75,000 in the aggregate.

•        The Merger Agreement provides that following the Merger, 10X Capital, as the surviving corporation in the Merger, will maintain for not less than six years from the Closing provisions in its organizational documents regarding the indemnification and exoneration of officers and directors that are no less favorable to such persons than the provisions in such organizational documents in effect on the date of the Merger Agreement.

•        The Merger Agreement provides that a six-year “tail,” directors’ and officers’ liability insurance policy covering persons currently covered by 10X Capital’s directors’ and officers’ liability insurance policies on terms not less favorable than the terms of such current directors’ and officers’ liability insurance policies will be purchased, and REE shall or shall cause its subsidiaries to maintain such “tail” policy for its full term.

Anticipated Accounting Treatment

The Transaction is comprised of a series of transactions pursuant to the Merger Agreement, as described elsewhere in this proxy statement/prospectus. For accounting purposes, the Transactions will be effectuated through three main steps:

1.      The conversion of REE Preferred Shares into REE Class A Ordinary Shares and the subsequent Stock Split immediately prior to the Effective Time, which are accounted for as a recapitalization in accordance with U.S. GAAP.

2.      The merger of 10X Capital with Merger Sub, which is not within the scope of ASC 805 (“Mergers”) because 10X Capital does not meet the definition of a business in accordance with ASC 805. Any difference between the fair value of REE Class A Ordinary Shares issued and the fair value of 10X Capital’s identifiable net assets should to be recorded as additional paid-in capital. For purposes of the unaudited pro forma condensed combined financial information, it is assumed that the fair value of each individual REE Class A Ordinary Share issued to 10X Capital stockholders is equal to the fair value of each individual REE Class A Ordinary Share held by a REE shareholder resulting from the $3.6 billion equity value assigned to REE in the Merger Agreement.

3.      The Subscription Agreements related to the PIPE Investment, which were executed concurrently with the Merger Agreement, will result in the issuance of 10X Capital Class A Common Stock, leading to an increase in share capital and share premium.

Regulatory Matters

The Merger is not subject to any federal or state regulatory requirement or approval, except for filings with the State of Delaware necessary to effectuate the Merger.

No Appraisal Rights

Under Section 262 of the General Corporation Law of the State of Delaware, the holders of 10X Capital Common Stock will not have appraisal rights in connection with the Merger.

The REE Class A Ordinary Shares to be issued in connection with the Merger will be freely transferable under the Securities Act except for (i) the PIPE Shares and (ii) shares issued to any shareholder who may be deemed for purposes of Rule 144 under the Securities Act an “affiliate” of 10X Capital immediately prior to the Effective Time or an “affiliate” of REE following the Merger. Persons who may be deemed to be affiliates include individuals or entities that control, are controlled by, or are under common control with, REE or 10X Capital (as appropriate) and may include the executive officers, directors and significant shareholders of REE or 10X Capital (as appropriate).

Stock Exchange Listing of REE Class A Ordinary Shares

REE will use commercially reasonable efforts to cause, prior to the Effective Time, the REE Class A Ordinary Shares and Warrants (including REE Class A Ordinary Shares and Warrants issuable pursuant to the Merger Agreement) to be approved for listing on Nasdaq under the symbols “REE” and “REEAW,” respectively, subject to official notice of issuance. Approval of the listing on Nasdaq of the REE Class A Ordinary Shares (subject to official notice of issuance) is a condition to each party’s obligation to complete the Merger. The corporate headquarters and principal executive offices of REE will be located at 10 Aharon Maskin Street, Tel Aviv, Israel.

Delisting and Deregistration of 10X Capital Common Stock

If the Merger is completed, shares of 10X Capital Class A Common Stock, 10X Capital Warrants and 10X Capital’s Units will be delisted from Nasdaq and will be deregistered under the Exchange Act.

REE Status as a Foreign Private Issuer under the Exchange Act

REE expects to be a “foreign private issuer” (under SEC rules). Consequently, upon consummation of the Merger, REE will be subject to the reporting requirements under the Exchange Act applicable to foreign private issuers. REE will be required to file its annual report on Form 20-F for the year ending December 31, 2021 with the SEC by April 30, 2022. In addition, REE will furnish reports on Form 6-K to the SEC regarding certain information required to be publicly disclosed by REE in Israel or that is distributed or required to be distributed by REE to its shareholders.

Based on its foreign private issuer status, REE will not be required to file periodic reports and financial statements with the SEC as frequently or as promptly as a U.S. company whose securities are registered under the Exchange Act. REE will also not be required to comply with Regulation FD, which addresses certain restrictions on the selective disclosure of material information. In addition, among other matters, REE officers, directors and principal shareholders will be exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act and the rules under the Exchange Act with respect to their purchases and sales of the REE Class A Ordinary Shares.

Despite its initial exemption due to its foreign private issuer status, following the consummation of the Merger, REE nevertheless expects to issue interim quarterly financial information publicly and to furnish it to the SEC on Form 6-K.

REE Status as an Emerging Growth Company under U.S. Federal Securities Laws and Related Implications

10X Capital is, and consequently, following the Merger, REE will be, an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, REE will be eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in their periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find REE’s securities less attractive as a result, there may be a less active trading market for REE’s securities and the prices of REE’s securities may be more volatile.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. REE has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, REE, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of REE’s financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used.

REE will remain an emerging growth company until the earlier of: (i) the last day of the fiscal year (a) following the fifth anniversary of the closing of REE’s initial public offering, (b) in which REE’s has total annual gross revenue of at least $1.07 billion, or (c) in which REE is deemed to be a large accelerated filer, which means the market value of REE’s common equity that is held by non-affiliates exceeds $700 million as of the last business day of its most recently completed second fiscal quarter; and (ii) the date on which REE has issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to “emerging growth company” have the meaning associated with it in the JOBS Act.

Required Vote

The approval of the Merger Proposal will require the affirmative vote by the holders of a majority of the outstanding shares of 10X Capital Common Stock. Abstentions and Broker Non-Votes will have the same effect as votes “AGAINST” the Merger Proposal.

The Merger is conditioned on the approval of the Merger Proposal as well as the other Condition Precedent Proposals. If the other Condition Precedent Proposals are not approved, this Merger Proposal will have no effect, even if approved by 10X Capital’s stockholders.

Recommendation of the 10X Capital Board of Directors

THE 10X CAPITAL BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT 10X CAPITAL STOCKHOLDERS VOTE “FOR” THE APPROVAL OF THE MERGER PROPOSAL.

PROPOSAL NO. 2 — THE Class b charter PROPOSAL

Assuming the Merger Proposal is approved, 10X Capital stockholders are being asked to adopt the Proposed 10X Capital Charter by approving the Class B Charter Proposal. The Class B Charter Proposal, if approved, will provide that 10X Capital will amend and restate the Existing 10X Capital Charter to provide that, immediately prior to the consummation of the Merger, all shares of 10X Capital Class B Common Stock will automatically convert into shares of 10X Capital Class A Common Stock with an amended Conversion Ratio that reflects the partial waiver of the Existing 10X Capital Charter’s conversion ratio adjustment, as agreed to between REE and 10X Capital in the Letter Agreement.

Section 4.3(b)(ii) of the Existing 10X Capital Charter provides that shares of 10X Capital Class B Common Stock shall be convertible into shares of 10X Capital Class A Common Stock automatically at the time of the closing of 10X Capital’s initial business combination at a ratio as described in the Existing 10X Capital Charter that would result in the issuance of all of the Anti-Dilution Shares. However, the transactions contemplated under the Merger Agreement, combined with the partial waiver by the Sponsor in the Letter Agreement of its right to receive the Anti-Dilution Shares, provide for, among other things, the conversion of shares of 10X Capital Class B Common Stock into shares of 10X Capital Class A Common Stock immediately prior to the Effective Time of the Merger with the issuance of only 2,900,000 Anti-Dilution Shares in connection with such conversion. Therefore, for the Merger to be effected in accordance with the terms of the Merger Agreement and the Letter Agreement, the Existing 10X Capital Charter must be amended for the conversion of shares of 10X Capital Class B Common Stock into shares of 10X Capital Class A Common Stock to occur before the Effective Time of the Merger at the adjusted Conversion Ratio agreed to by the Sponsor. Approval of this proposal will not result in any other changes to the Existing 10X Capital Charter.

The following table sets forth a summary of the differences between the Existing 10X Capital Charter and the Proposed 10X Capital Charter.

This proposal is conditioned upon the approval and completion of the Merger Proposal; if the Merger Proposal is not approved, this proposal will have no effect, even if approved by 10X Capital stockholders. In addition, the effectuation of the Merger is conditioned upon, among other things, the approval of this proposal; if this proposal is not approved, the Merger will not be completed.

Required Vote

The approval of the Class B Charter Proposal will require the affirmative vote by the holders of a majority of the outstanding shares of 10X Capital Common Stock. Abstentions and Broker Non-Votes will have the same effect as votes “AGAINST” the Class B Charter Proposal.

The Merger is conditioned on the approval of the Class B Common Stock Proposal as well as the other Condition Precedent Proposals. If the other Condition Precedent Proposals are not approved, this Class B Common Stock Proposal will have no effect, even if approved by 10X Capital’s stockholders.

Recommendation of the 10X Capital Board of Directors

THE 10X CAPITAL BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT 10X CAPITAL STOCKHOLDERS VOTE “FOR” THE APPROVAL OF THE CLASS B CHARTER PROPOSAL.

PROPOSAL NO. 3 — THE material differences charter PROPOSAL

Assuming the Merger Proposal is approved, we are seeking stockholder approval to adopt the Material Differences Charter Proposal. The Material Differences Charter Proposal, if approved, will approve the following material differences between the Existing 10X Capital Charter and Amended and Restated Articles to be in effect following the Merger:

•        The name of the new public entity will be “REE Automotive Ltd.” as opposed to “10X Capital Venture Acquisition Corp”.

•        The Amended and Restated Articles will provide for two classes of ordinary shares. The REE Class A Ordinary Shares will each have one vote per share. The REE Class B Ordinary Shares will each have 10 votes per share. All of the REE Class B Ordinary Shares will initially be held by the Founders who will individually have up to approximately 39% of the voting power and collectively have up to approximately 78% of the voting power of REE following the Merger. The two classes of stock of 10X Capital do not have different voting rights. The holders of the REE Class B Ordinary Shares collectively will control a majority of the combined voting power of the REE Ordinary Shares following the Closing and therefore will be able to control the outcome of all matters submitted to our stockholders for approval, including the election of directors, amendments of our organizational documents and approval of significant corporate transactions. This concentrated control will limit or preclude the ability of holders of REE Class A Ordinary Shares to influence corporate matters for the foreseeable future. In addition, this may prevent or discourage unsolicited acquisition proposals or offers for REE Ordinary Shares that you may believe are in your best interest as one of our stockholders.

•        REE’s corporate existence is perpetual as opposed to 10X Capital’s corporate existence terminating if a business combination is not consummated within a specified period of time.

•        The Amended and Restated Articles will not include the various provisions applicable only to special purpose acquisition companies that the Existing 10X Capital Charter contains and will contain provisions that are generally typical for Israeli companies that are listed in the U.S.

In the judgment of the 10X Capital board of directors, the Material Difference Charter Proposal is desirable for the following reasons:

•        The name of the new public entity is desirable to reflect the Merger and the combined business going forward.

•        The dual class stock structure is common for technology companies listed in the U.S. and will offer stability to REE as a public company and enable it to pursue its long-term strategy. At the same time, the dual class stock contains a number of protections for shareholders, including that no Founder individually will control a majority of voting power and REE Class B Ordinary Shares have carefully negotiated termination provisions and a 10-year sunset.

•        The provisions that relate to the operation of 10X Capital as a blank check company prior to the consummation of its initial business combination would not be applicable after the Merger (such as the obligation to dissolve and liquidate if an initial business combination is not consummated in a certain period of time).

For a comparison of the Existing 10X Capital Charter and Amended and Restated Articles, see “Comparison of Rights of REE Shareholders and 10X Capital Stockholders”.

A copy of the Amended and Restated Articles, as will be in effect assuming approval of the Material Differences Charter Proposal and upon consummation of the Merger, is attached to this proxy statement/prospectus as Annex B.

Required Vote

The approval of the Material Differences Charter Proposal will require the affirmative vote by the holders of a majority of the outstanding shares of 10X Capital Common Stock. Abstentions and Broker Non-Votes will have the same effect as votes “AGAINST” the Material Differences Charter Proposal.

PROPOSAL NO. 4 — THE ADJOURNMENT PROPOSAL

The Adjournment Proposal allows the 10X Capital board of directors to submit a proposal to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation of proxies in the event, based on the tabulated votes, there are not sufficient votes at the time of the Special Meeting to approve the consummation of the Merger Proposal, the Class B Charter Proposal, or the Material Differences Charter Proposal. In no event will 10X Capital solicit proxies to adjourn the Special Meeting or consummate the Merger beyond the date by which it may properly do so under the Existing 10X Capital Charter and Delaware law. The purpose of the Adjournment Proposal is to provide more time for 10X Capital’s stockholders, REE and the REE shareholders to make purchases of Public Shares or other arrangements that would increase the likelihood of obtaining a favorable vote on the Merger Proposal the Class B Charter Proposal, and the Material Differences Charter Proposal and to meet the requirements that are necessary to consummate the Merger. See the section entitled “Proposal No. 1 — The Merger Proposal — Interests of 10X Capital’s Directors and Officers in the Merger.”

In addition to an adjournment of the Special Meeting upon approval of an Adjournment Proposal, the 10X Capital board of directors is empowered under Delaware law to postpone the Special Meeting at any time prior to the meeting being called to order. In such event, 10X Capital will issue a press release and take such other steps as it believes are necessary and practical in the circumstances to inform its stockholders of the postponement.

Consequences if the Adjournment Proposal is not Approved

If an Adjournment Proposal is presented to the meeting and is not approved by the stockholders, the 10X Capital board of directors may not be able to adjourn the Special Meeting to a later date in the event that, based on the tabulated votes, there are not sufficient votes at the time of the Special Meeting to approve the Merger Proposal, the Class B Charter Proposal, or the Material Differences Charter Proposal.

Required Vote and Recommendation of the Board

Adoption of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by holders of shares of 10X Capital Common Stock represented virtually or by proxy at the Special Meeting and entitled to vote thereon. Abstentions will have the same effect as a vote “AGAINST” the Adjournment Proposal and Broker Non-Votes will have no effect on the Adjournment Proposal. Adoption of the Adjournment Proposal is not conditioned upon the adoption of the Merger Proposal.

THE 10X CAPITAL BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT 10X CAPITAL STOCKHOLDERS VOTE “FOR” THE APPROVAL OF THE ADJOURNMENT PROPOSAL.

THE MERGER AGREEMENT

For a discussion of the Merger structure and merger consideration provisions of the Merger Agreement, see the section entitled “Proposal No. 1 — The Merger Agreement Proposal.” Such discussion and the following summary of other material provisions of the Merger Agreement is qualified by reference to the complete text of the Merger Agreement, a copy of which is attached as Annex A to this proxy statement/prospectus. All 10X Capital stockholders are encouraged to read the Merger Agreement in its entirety for a more complete description of the terms and conditions of the Merger.

The Merger Agreement summary below is included in this proxy statement/prospectus only to provide you with information regarding the terms and conditions of the Merger Agreement and not to provide any other factual information regarding 10X Capital, REE or their respective businesses. Accordingly, the representations and warranties and other provisions of the Merger Agreement should not be read alone, but instead should be read only in conjunction with the information provided elsewhere in this proxy statement/prospectus.

Closing and Effective Time of the Merger

The closing of the Merger will take place no later than the third business day following the satisfaction or waiver of the conditions set forth in the Merger Agreement and summarized below under the subsection entitled “— Conditions to Closing of the Merger,” unless 10X Capital and REE agree in writing to another time or unless the Merger Agreement is terminated pursuant to its terms.

Conditions to Closing of the Merger

Conditions to Each Party’s Obligations

The respective obligations of each party to the Merger Agreement to consummate the transactions contemplated by the Merger are subject to the satisfaction or waiver, if permitted by applicable law, by the party for whose benefit such condition exists, of the following conditions:

•        the approvals by the applicable shareholders of REE (the “REE Shareholder Approval”), by REE as the sole shareholder of Merger Sub, and by the applicable stockholders of 10X Capital (the “10X Capital Stockholder Approval”), in each case as required by the Merger Agreement, shall have been received;

•        10X Capital shall have at least $5,000,001 of net tangible assets immediately after giving effect to the exercise of 10X Capital’s public stockholders’ redemption rights in accordance with 10X Capital’s organizational documents;

•        there shall not be in effect any applicable law or regulation prohibiting, enjoining or making illegal the consummation of the transactions contemplated by the Merger Agreement, and no temporary, preliminary or permanent restraining order prohibiting, enjoining or making illegal the consummation of the transactions contemplated by the Merger Agreement shall be in effect or shall be threatened in writing by a governmental entity;

•        the REE Class A Ordinary Shares and REE Warrants to be issued in connection with the Closing shall be approved for listing upon the Closing on Nasdaq, subject only to official notice of issuance thereof;

•        this registration statement shall have become effective in accordance with the provisions of the Securities Act, no stop order shall have been issued by the SEC which remains in effect with respect to this registration statement, and no proceeding seeking such a stop order shall have been threatened or initiated by the SEC which remains pending;

•        the Capital Restructuring shall have been completed in accordance with the terms of the Merger Agreement and REE’s organizational documents;

•        the PIPE Investment (and the funding thereof) shall have been consummated or will be consummated substantially concurrently with the Closing in accordance with the terms of the PIPE Subscription Agreements; and

•        the funds contained in the Trust Account (after giving effect to the exercise of 10X Capital’s public stockholders’ redemption rights and payment of the transaction costs incurred by 10X Capital), together with (i) the aggregate amount of proceeds from the PIPE Investment and (ii) the cash on 10X Capital’s balance sheet, shall equal or exceed $225,000,000.

Other Conditions to the Obligations of 10X Capital

The obligations of 10X Capital to consummate and effect the Merger shall be subject to the satisfaction at or prior to the Closing of each of the following conditions, any of which may be waived, to the extent permitted by applicable law, in writing, exclusively by 10X Capital:

•        certain representations and warranties of REE regarding the organization of REE, the capitalization of REE and its subsidiaries, the authority of REE and Merger Sub to, among other things, execute and deliver the Merger Agreement and each of the Related Agreements to which it is or will be a party and to consummate the transactions contemplated thereby, and brokers’ fees shall be true and correct in all material respects (without giving effect to any limitation as to “materiality” or any similar limitation contain in the Merger Agreement) on and as of the date of the Merger Agreement and on as of the Closing Date as though made on and as of the Closing Date (except (i) to the extent that any such representation and warranty expressly speaks as of an earlier date in which case such representation and warranty shall be true and correct as of such earlier date; and (ii) except for any such representations that are qualified with “Company Material Adverse Effect” (as defined in the Merger Agreement) which shall be true and correct in all respects);

•        the representation and warranty of REE that, between September 30, 2020 and the date of the Merger Agreement, there had not been any change, event, state of facts, development or occurrence that, individually or in the aggregate, had or would reasonably be expected to have had a Company Material Adverse Effect, shall have been true and correct as of the date of the Merger Agreement;

•        all other representations and warranties of REE shall be true and correct (without giving effect to any limitation as to “materiality” or “Company Material Adverse Effect” or any similar limitation contained in the Merger Agreement) on and as of the date of the Merger Agreement and on as of the Closing Date as though made on and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date), except where the failure of such representations and warranties of REE to be so true and correct, individually or in the aggregate, has not had and is not reasonably likely to have a Company Material Adverse Effect;

•        REE shall have performed all agreements and covenants required by the Merger Agreement to be performed by it at or prior to the Closing Date, in each case, in all material respects;

•        no change, event, state of facts, development or occurrence shall have occurred since the date of the Merger Agreement, that, individually or in the aggregate with all other changes, events, state of facts, developments or occurrences, has had or would reasonably be expected to have a Company Material Adverse Effect that is continuing; and

•        REE shall have delivered, or caused to be delivered, a certificate, signed by an executive officer of REE and dated as of the Closing Date, certifying as to the matters set forth in the first five bullet points of this section to 10X Capital.

Other Conditions to the Obligations of REE and Merger Sub

The obligations of REE and Merger Sub to consummate, or cause to be consummated, the Merger are subject to the satisfaction at or prior to the Closing of each of the following conditions, any of which may be waived, to the extent permitted by applicable law, in writing, exclusively by REE:

•        certain representations and warranties of 10X Capital regarding the organization of 10X Capital (including that 10X Capital does not have any subsidiaries), the capitalization of 10X Capital, the authority of 10X Capital to, among other things, execute and deliver the Merger Agreement and each of the Related Agreements to which it is or will be a party and to consummate the transactions contemplated thereby, the business activities of 10X Capital and brokers’ fees shall be true and correct in all material respects (without giving effect to any limitation as to “materiality” or “SPAC Material Adverse Effect” (as defined in the Merger Agreement) or any similar limitation contain in the Merger Agreement) on and as of the date of the Merger Agreement and on and as of the Closing Date as though made on and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date);

•        the representation and warranty of 10X Capital that there had not been any SPAC Material Adverse Effect since its incorporation shall be true and correct as of the date of the Merger Agreement;

•        all other representations and warranties of 10X Capital shall be true and correct (without giving effect to any limitation as to “materiality” or “SPAC Material Adverse Effect” or any similar limitation contained in the Merger Agreement) on and as of the date of the Merger Agreement and on as of the Closing Date as though made on and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date), except where the failure of such representations and warranties of 10X Capital to be so true and correct, individually or in the aggregate, has not had and is not reasonably likely to have a SPAC Material Adverse Effect;

•        10X Capital shall have performed with all agreements and covenants required by the Merger Agreement to be performed by it on or prior to the Closing Date, in each case in all material respects; and

•        10X Capital shall have delivered a certificate, signed by an executive officer of 10X Capital and dated as of the Closing Date, certifying as to the matters set forth in the first four bullet points of this section to REE.

Representations and Warranties

Under the Merger Agreement 10X Capital made customary representations and warranties relating, among other things, to:

•        organization and qualification;

•        subsidiaries;

•        capitalization;

•        the authorization, delivery and enforceability of the Merger Agreement and the Related Agreements;

•        noncontravention (including as to any required governmental filings and consents);

•        compliance with laws;

•        SEC reports and financial statements;

•        absence of certain changes or events;

•        litigation and proceedings;

•        business activities;

•        material contracts;

•        Nasdaq listing;

•        absence of undisclosed liabilities;

•        the Trust Account;

•        taxes;

•        accuracy of information supplied;

•        employees and benefit plans;

•        required board and stockholder approval;

•        title to assets;

•        transactions with affiliates;

•        Investment Company Act and JOBS Act;

•        brokers’ fees;

•        PIPE Investment Amount; and

•        independent investigation and absence of outside reliance.

Under the Merger Agreement, each of REE and Merger Sub made customary representations and warranties relating, among other things, to:

•        organization and qualification;

•        subsidiaries;

•        capitalization;

•        the authorization, delivery and enforceability of the Merger Agreement and the Related Agreements;

•        noncontravention (including as to any required governmental filings and consents);

•        compliance with laws;

•        financial statements;

•        internal controls;

•        absence of undisclosed liabilities;

•        absence of certain changes or events;

•        litigation and proceedings;

•        employee benefits;

•        labor matters;

•        anti-trust matters;

•        real and personal property;

•        taxes;

•        environmental matters;

•        brokers’ fees;

•        intellectual property;

•        privacy and data security;

•        governmental grants;

•        material contracts;

•        insurance;

•        transactions with affiliates;

•        accuracy of information supplied;

•        anti-corruption compliance;

•        suppliers; and

•        independent investigation and absence of outside reliance.

•        sell, lease, license, sublicense, abandon, divest, transfer, cancel or permit to lapse or expire or dedicate to the public, or otherwise dispose of, tangible assets or properties, or agree to do any of the foregoing, including with respect to the Softwheel Business, other than, in each case, (i) in the ordinary course of business or (ii) with respect to obsolete assets;

•        issue or sell any debt securities or rights to acquire any debt securities or guarantee any debt securities of another person; (ii) make, create any loans, advances or capital contributions to, or investments in, any person other than REE or any of its subsidiaries; (iii) create, incur, assume, guarantee or otherwise become liable for, any indebtedness except in the ordinary course of business, in an aggregate amount not to exceed $15,000,000; (iv) except in the ordinary course of business consistent with past practice, create any liens on any material property or material assets of REE or any of its subsidiaries in connection with any indebtedness thereof (other than liens permitted by the Merger Agreement); or (v) cancel or forgive any indebtedness owed to REE or any of its subsidiaries;

•        make, incur or commit to make or incur, or authorize any capital expenditures that will require payments after the Closing Date other than capital expenditures consistent in the aggregate with the capital expenditure plan disclosed to 10X Capital;

•        other than any shareholder litigation related to the Merger Agreement or the other Related Agreements or the transactions contemplated thereby that is brought or threatened in writing against either REE or 10X Capital, or any of the respective members of their boards of directors, after the date of the Merger Agreement and prior to the Effective Time (the “Transaction Litigation”), commence, release, assign, compromise, settle or agree to settle any legal proceeding material to REE or any of its subsidiaries or their respective properties or assets, except in the ordinary course of business or where such legal proceedings are covered by insurance or involve only the payment of monetary damages in an amount less than $250,000 in the aggregate;

•        except in the ordinary course of business consistent with past practices: (i) modify, amend in a manner that is adverse to REE or its applicable subsidiary or terminate any REE Material Contract; (ii) enter into any contract that would have been a REE Material Contract had it been entered into prior to the date of the Merger Agreement; or (iii) waive, delay the exercise of, release or assign any material rights or claims under any REE Material Contract;

•        except as required by GAAP (or any interpretation thereof) or applicable law, make any change in accounting methods, principles or practices;

•        make, change or rescind any material tax election; (ii) settle or compromise any tax claim outside the ordinary course of business; (iii) change (or request to change) any material method of accounting for tax purposes; (iv) file any material amended tax return; (v) waive or extend any statute of limitations in respect of a period within which an assessment or reassessment of taxes may be issued (other than any extension pursuant to an extension to file any tax return); (vi) knowingly surrender any claim for a material refund of taxes; (vii) enter into any “closing agreement” as described in Section 7121 of the Code (or any similar applicable law) with any governmental entity; or (viii) knowingly take any action or knowingly fail to take any action, which action or failure to act would reasonably be expected to prevent or impede the Merger from qualifying for the Intended Tax Treatment (as defined in the Merger Agreement);

•        authorize, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation, restructuring, recapitalization, dissolution or winding-up of REE;

•        subject to the terms of the Merger Agreement, enter into or amend any agreement with, or pay, distribute or advance any assets or property to, any of its officers, directors, employees, partners, stockholders or other affiliates, other than payments or distributions relating to obligations in respect of arm’s-length commercial transactions pursuant to the agreements set forth on REE’s disclosure letter as existing on the date of the Merger Agreement;

•        engage in any material new line of business;

•        limit the rights of REE or any of its subsidiaries in any respect: (A) to engage in any line of business or in any geographic area; (B) to develop, market or sell products or services; or (C) to compete with any person; or (ii) grant any exclusive or similar rights to any person;

•        terminate or amend, in a manner materially detrimental to REE or any of its subsidiaries, any insurance policy insuring the business of REE or any of its subsidiaries;

•        incur any Leakage (as defined in the Merger Agreement), other than Permitted Leakage (as defined in the Merger Agreement); or

•        agree in writing or otherwise agree, commit or resolve to take any of the actions described in the foregoing.

Except (i) to the extent that REE otherwise consents in writing (such consent not to be unreasonably withheld, conditioned or delayed), (ii) as required by applicable law (including with respect to COVID-19) or as reasonably necessary in light of COVID-19 or (iii) as required or expressly permitted by the Merger Agreement or 10X Capital’s disclosure letter, 10X Capital has agreed to, from the date of the Merger Agreement until the earlier of the Closing or the termination of the Merger Agreement pursuant to its terms, carry on in the ordinary course of business and not do any of the following:

•        declare, set aside or pay dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any capital stock or warrants or split, combine or reclassify any capital stock or warrants, effect a recapitalization or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any capital stock or warrant, or effect any similar change in capitalization;

•        purchase, redeem or otherwise acquire, directly or indirectly, any equity securities of 10X Capital;

•        grant, issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any shares of capital stock or other equity securities or any securities convertible into or exchangeable for shares of capital stock or other equity securities, or subscriptions, rights, warrants or options to acquire any shares of capital stock or other equity securities or any securities convertible into or exchangeable for shares of capital stock or other equity securities, or enter into other agreements or commitments of any character obligating it to issue any such shares of capital stock or equity securities or convertible or exchangeable securities;

•        amend its organizational documents or form or establish any subsidiary;

•        acquire or agree to acquire (whether by merger, consolidation or acquisition of securities or a substantial portion of the assets of) any corporation, partnership, association or other business organization or division or assets thereof;

•        incur any indebtedness; (ii) create any material liens on any material property or assets of 10X Capital in connection with any indebtedness thereof (other than liens otherwise permitted by the Merger Agreement or REE’s disclosure letter); (iii) cancel or forgive any indebtedness owed to 10X Capital; or (iv) make, incur or commit to make or incur any capital expenditures;

•        other than the Transaction Litigation, commence, release, assign, compromise, settle or agree to settle any legal proceeding;

•        except as required by U.S. GAAP (or any interpretation thereof) or applicable law, make any change in accounting methods, principles or practices;

•        except in the ordinary course of business or as otherwise required by applicable law: (i) make, change or rescind any material tax election; (ii) settle or compromise any tax claim outside the ordinary course of business; (iii) change (or request to change) any material method of accounting for tax purposes; (iv) file any material amended tax return; (v) waive or extend any statute of limitations in respect of a period within which an assessment or reassessment of taxes may be issued (other than any extension pursuant to an extension to file any tax return); (vi) knowingly surrender any claim for a material refund of taxes; (vii) enter into any “closing agreement” as described in Section 7121 of the Code (or any similar

applicable law) with any governmental entity; or (viii) knowingly take any action or knowingly fail to take any action, which action or failure to act would reasonably be expected to prevent or impede the Merger from qualifying for the Intended Tax Treatment;

•        authorize, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation, restructuring, recapitalization, dissolution or winding-up of 10X Capital or (ii) liquidate, dissolve, reorganize or otherwise wind-up the business or operations of 10X Capital;

•        enter into or amend any agreement with, or pay, distribute or advance any assets or property to, or waive any provision or fail to enforce any provision with any agreement with, any of its officers, directors, employees, partners, stockholders or other affiliates;

•        engage in any material new line of business;

•        amend the Investment Management Trust Agreement, effective as of November 24, 2020, by and between 10X Capital and Continental Stock Transfer & Trust Company, a New York corporation, or any other agreement related to the Trust Account; or

•        agree in writing or otherwise agree, commit or resolve to take any of the actions described in the foregoing.

Additional Covenants of the Parties

The Merger Agreement contains additional customary covenants of REE including, among other things, covenants relating to:

•        convening a shareholder meeting and obtaining shareholder approval of the Merger Agreement and the transactions contemplated thereunder;

•        obtaining executed counterparts to the Support Agreement from REE shareholders holding at least the number of REE shares required to approve the Merger Agreement and the transactions contemplated thereby;

•        the granting of access to information;

•        obtaining shareholder approval of and adopting the incentive equity plan and employee stock purchase plans;

•        listing of the REE Class A Ordinary Shares and the REE Warrants on Nasdaq;

•        the classification and appointment of the board of directors of REE;

•        complying with applicable notice and consent requirements of the Israeli Innovation Authority with respect to the Merger Agreement and the transactions contemplated thereunder;

•        amending the Amended and Restated Articles;

•        the payment of transfer taxes incurred in connection with the Merger Agreement and the transaction contemplated thereby;

•        taking certain actions with respect to the indemnification of the current and former directors and officers of 10X Capital; and

•        the issuance of a press release relating to the Closing.

The Merger Agreement contains additional customary covenants of 10X Capital including, among other things, covenants relating to:

•        convening the Special Meeting and obtaining stockholder approval of the Merger Agreement and the transactions contemplated thereunder;

•        maintaining 10X Capital’s listing on Nasdaq until the Closing;

•        complying with its reporting obligations, including by timely filing all reports required to be filed or furnished with the SEC;

•        causing the 10X Capital Class A Common Stock and 10X Capital Warrants to be delisted from Nasdaq and deregistered under the Exchange Act following the Effective Time;

•        the termination of certain agreements with 10X Capital stockholders;

•        preparation and delivery of financial information necessary for this registration statement, this proxy statement/prospectus and other filings;

•        the procurement of a “tail” officers’ and directors’ liability insurance policy for 10X Capital’s officers and directors; and

•        the Trust Account, the PIPE Subscription Agreements and the Letter Agreement.

The Merger Agreement contains additional customary mutual covenants of REE and 10X Capital including, among other things, covenants relating to:

•        the preparation and delivery of this registration statement and this proxy statement/prospectus;

•        providing copies of all substantive written communications with any governmental entity;

•        the procurement of necessary approvals from governmental entities and third parties;

•        responding to inquiries from and corresponding with governmental entities;

•        keeping certain information confidential in accordance with the existing confidentiality agreement;

•        making relevant public announcements;

•        not soliciting alternative business combination proposals;

•        causing any acquisition or disposition of the 10X Capital Common Stock or the REE Ordinary Shares pursuant to the Merger by director or officers of 10X Capital or REE to be exempt under Rule 16b-3 promulgated under the Exchange Act;

•        assigning the Warrant Agreement in order to, among other things, reflect the assumption of the 10X Capital Warrants by REE;

•        notifying the other party after learning of any shareholder demands or proceedings relating to the Merger Agreement, any Related Agreement or any matters relating thereto and reasonably cooperating with one another in connection therewith; and

•        notifying the other party of (i) any event, development or condition that is reasonably likely to cause any of the closing conditions not to be satisfied or would require any amendment or supplement to this registration statement; or (ii) the receipt of notice from any person alleging that the consent of such person may be required in connection with the transactions contemplated by the Merger Agreement or the Related Agreements to the extent failure to obtain such consent would cause a material adverse effect to either party.

Termination

The Merger Agreement may be terminated at any time prior to the Closing:

•        by the mutual written consent of 10X Capital and REE;

•        by either 10X Capital or REE:

•        if the Merger shall not have been consummated by the Outside Date; provided, however, that the right to terminate the Merger Agreement on this basis shall not be available to any party whose action or failure to act has been a principal cause of or resulted in the failure of the Merger to occur on or before such date and such action or failure to act constitutes a material breach of the Merger Agreement;

•        if a governmental entity shall have issued an order or taken any other action, in any case having the effect of permanently restraining, enjoining or otherwise prohibiting the Merger, which order or other action is final and nonappealable;

•        if, at the Special Meeting (including any adjournments thereof), the SPAC Transaction Proposals (as defined in the Merger Agreement) are not duly adopted by the 10X Capital stockholders by the requisite vote under applicable law and 10X Capital’s organizational documents;

•        if, at the REE general shareholder meeting of shareholders (including any adjournments thereof), the Company Transaction Proposals (as defined in the Merger Agreement) are not duly adopted by the REE shareholders by the requisite vote under applicable law and REE’s organizational documents; or

•        if the closing condition regarding the minimum cash amount to be contained in the Trust Account becomes incapable of being satisfied at the Closing;

•        by REE:

•        if REE is not in material breach of its obligations under the Merger Agreement, upon a breach of any representation, warranty, covenant or agreement set forth in the Merger Agreement on the part of 10X Capital, or if any representation or warranty of 10X Capital shall have become untrue, in either case such that the certain conditions to the obligations of REE, as described in the section entitled “— Conditions to Closing of the Merger” above would not be satisfied and the breach (or breaches) of such representations or warranties or failure (or failures) to perform such covenants or agreements is (or are) not cured or cannot be cured within the earlier of (i) 30 days after written notice thereof, and (ii) the Outside Date; or

•        if the board of directors of 10X Capital or any committee thereof makes, prior to receipt of the 10X Capital Stockholder Approval, a change in recommendation;

•        by 10X Capital:

•        if 10X Capital is not in material breach of its obligations under the Merger Agreement, upon a breach of any representation, warranty, covenant or agreement set forth in the Merger Agreement on the part of REE or Merger Sub or if any representation or warranty of REE or Merger Sub shall have become untrue, in either case such that certain conditions to the obligations of 10X Capital, as described in the section entitled “— Conditions to Closing of the Merger” above would not be satisfied and the breach (or breaches) of such representations or warranties or failure (or failures) to perform such covenants or agreements is (or are) not cured or cannot be cured within the earlier of (i) 30 days after written notice thereof, and (ii) the Outside Date; or

•        if shareholders of REE holding at least the number of REE shares required to give the REE Shareholder Approval have not executed the Support Agreement within 45 days after the date of the Merger Agreement.

Effect of Termination

In the event of the termination of the Merger Agreement, the Merger Agreement will be of no further force or effect and the transactions contemplated by the Merger Agreement will be abandoned, except that the parties will, in all events, remain bound by and continue to be subject to the provisions of the Merger Agreement relating to: (i) the confidentiality agreement between the parties; (ii) claims against the Trust Account; and (iii) certain miscellaneous provisions of the Merger Agreement, including those related to interpretation, governing law, consent to jurisdiction, waiver of jury trial, rules of construction, no recourse, and legal representation, among others. However, no such termination will relieve any party to the Merger Agreement from any liability resulting from any willful breach of the Merger Agreement or intentional fraud in the making of the representations and warranties in the Merger Agreement.

Fees and Expenses

Except as otherwise expressly provided in the Merger Agreement, whether or not the transactions contemplated by the Merger Agreement, including the Merger, are consummated, each party to the Merger Agreement will pay its own costs and expenses incurred in anticipation of, relating to and in connection with the negotiation and execution of the Merger Agreement and the Related Agreements and the consummation of the transactions contemplated by the Merger Agreement.

Amendments

The Merger Agreement may be amended by the parties thereto at any time by execution of an instrument in writing signed on behalf of each of such parties.

Governing Law

The Merger Agreement and the consummation of the transactions contemplated thereby shall be governed by and construed in accordance with the internal law of the State of Delaware regardless of the law that might otherwise govern under applicable principles of conflicts of law thereof, except to the extent that the laws of the State of Israel are mandatorily applicable.

Tax Consequences

For U.S. federal income tax purposes, the parties to the Merger Agreement (i) intend that the Merger qualify as a “reorganization” within the meaning of Section 368(a) of the Code; (ii) adopted the Merger Agreement as a “plan of reorganization” within the meaning of Section 1.368-2(g) of the U.S. Treasury regulations; and (iii) intend that the transfer of 10X Capital Class A Common Stock by 10X Capital stockholders pursuant to the Merger, other than by any 10X Capital stockholders who are U.S. persons and who are or will be “five-percent transferee shareholders” within the meaning of Treasury regulations Section 1.367(a)-3(c)(5)(ii) but who do not enter into gain recognition agreements within the meaning of Treasury regulations Sections 1.367(a)-3(c)(1)(iii)(B) and 1.367(a)-8, qualifies for an exception to Section 367(a)(1) of the Code.

For a description of certain material U.S. federal income tax consequences of the Merger, see the section entitled “Certain Material U.S. Federal Income Tax Consequences.”

Survival and Indemnification

None of the representations, warranties, covenants or agreements in the Merger Agreement or in any instrument delivered pursuant to the Merger Agreement will survive the Closing and all rights, claims and causes of action (whether in contract or in tort or otherwise, or whether at law or in equity) with respect thereto shall terminate at the Closing, other than (i) such representations and warranties solely to the extent required to enable a party to bring a claim for intentional fraud in the making of the representations and warranties by such person, and (ii) covenants or agreements which by their terms are required to be performed or complied with in whole or in part following the Closing, which covenants and agreements will survive the Closing in accordance with their respective terms.

AGREEMENTS ENTERED INTO IN CONNECTION WITH THE MERGER AGREEMENT

This section describes the material provisions of certain additional agreements entered into or to be entered into pursuant to the Merger Agreement (the “Related Agreements”) but does not purport to describe all of the terms thereof. The following summary is qualified in its entirety by reference to the complete text of each of the Related Agreements, and other interested parties are urged to read such Related Agreements in their entirety.

Subscription Agreements

Concurrently with the execution of the Merger Agreement, 10X Capital and REE entered into the Subscription Agreements with the PIPE Investors, pursuant to which the PIPE Investors have agreed to purchase, and 10X Capital has agreed to sell the PIPE Investors, an aggregate of 30,000,000 shares of 10X Capital Class A Common Stock, for a purchase price of $10.00 per share and at an aggregate purchase price of $300,000,000. The obligations to consummate the transactions contemplated by the Subscription Agreements are conditioned upon, among other things, customary closing conditions and the consummation of the transactions contemplated by the Merger Agreement. The Subscription Agreements include customary resale registration rights provisions.

Support Agreement

Concurrently with the execution of the Merger Agreement, 10X Capital, the Sponsor, REE, the REE shareholders party thereto (collectively, the “Voting Parties”) entered into the Support Agreement. Pursuant to the Support Agreement, the Sponsor has agreed, among other things, to vote its shares of 10X Capital Common Stock (representing 20% of such outstanding shares), and take certain other actions, in support of the Merger, and REE and the REE shareholders party thereto have agreed, among other things, to vote their REE Ordinary Shares (representing approximately 95% of such outstanding shares and, together with other shares of REE subject to proxy agreements, representing approximately 99%), and take certain other actions, in support of the Merger.

In addition, each of the Voting Parties agreed not to transfer, directly or indirectly, any of their voting securities of the Company or REE until the earliest of the Effective Time or the date on which the Merger Agreement is terminated in accordance with its terms, subject to certain exceptions described in the Support Agreement. Under the terms of the Support Agreement, the Sponsor and the Insiders each agreed to waive and not to assert or perfect any rights of appraisal or rights to dissent from the transactions contemplated in the Merger Agreement, and not to exercise any right to redeem any Class A Common Stock.

Pursuant to the Merger Agreement, 10X Capital may terminate the Merger Agreement if certain REE shareholders, holding at least the number of REE Ordinary Shares required to give REE shareholder approval on the matters described in the Merger Agreement, have not executed the Support Agreement within forty-five days after the date of the Merger Agreement

Investors’ Rights Agreement

Concurrently with the execution and delivery of the Merger Agreement, REE, the Company, the Sponsor, the Insiders, and certain REE shareholders entered into an Investors’ Rights Agreement, to be effective as of the Effective Time, pursuant to which REE agreed to file a registration statement as soon as practicable following the exercise of a demand registration right by certain significant shareholders of REE to register the resale of certain registrable securities under the Securities Act, subject to required notice provisions to other shareholders party thereto. Certain REE shareholders party to the Investors’ Rights Agreement will be entitled to an aggregate of three demands and the Sponsor will be entitled to two demands. REE also agreed to provide customary “piggyback” registration rights with respect to such registrable securities and, subject to certain circumstances, REE is required to file a resale shelf registration statement to register the resale under the Securities Act of such registrable securities. REE also agreed to file a resale shelf registration statement within 30 days of the Closing to register the resale of the REE Class A Ordinary Shares and REE Warrants held by the Sponsor. In addition, in connection with the execution of the Investors’ Rights Agreement, 10X Capital is obligated to terminate the existing registration rights agreement, dated November 24, 2020. The Investors’ Rights Agreement also provides that REE will pay certain expenses relating to such registrations and indemnify the securityholders party thereto against certain liabilities.

Under the terms of the Investors’ Rights Agreement, the Sponsor has agreed that it shall not transfer any of its REE Class A Ordinary Shares issued in connection with the Merger until (i) with respect to 25% of such shares, the date that is 90 days following the Closing Date, and (ii) with respect to 75% of such shares, the first to occur of (x) the date that is 12 months following the Closing Date and (y) such time as the closing price of the REE Class A Ordinary Shares equals or exceeds $13.00 per share for any 20 trading days out of 30 consecutive trading days following the Closing Date; provided that if the condition based on the closing price is met prior to the date that is 180 days following the Closing Date, the restriction on such shares shall expire on the date that is 180 days following the Closing Date. Further, each Insider has agreed that it shall not transfer any of its REE Class A Ordinary Shares issued in connection with the Merger until the date that is 180 days following the Closing Date. The foregoing restrictions on transfer of the Sponsor’s and the Insiders’ REE Class A Ordinary Shares shall terminate and no longer be applicable upon the date following the Closing Date on which REE completes a liquidation, merger, capital stock exchange, or other similar transaction that results in all of REE’s shareholders having the right to exchange their REE Class A Ordinary Shares for cash, securities or other property. The Sponsor also has agreed not to transfer any of its REE Warrants until 30 days after the Closing Date.

Certain shareholders party to the Investors’ Rights Agreement have agreed that they shall not transfer of their REE Ordinary Shares until 180 days after the Closing of the Merger. Additionally, the Founders have agreed that they shall not transfer any of their REE Ordinary Shares until (i) the earlier of (a) one year from the Closing and (b) when the closing price of the REE Ordinary Shares is equal to or greater than $13.00 for any 20 trading days within a 30-trading day period (provided that if such condition is satisfied during the first six months from Closing, such restriction on transfer will not lapse until the six-month anniversary of the Closing), or (ii) in any case, if, after the date hereof, the REE completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of REE’s shareholders having the right to exchange their REE Ordinary Shares for cash, securities or other property

Letter Agreement

Concurrently with the execution and delivery of the Merger Agreement, the Company, Insiders, the Sponsor and REE entered into a Letter Agreement.

Under the terms of the Letter Agreement, the Sponsor, as the holder of all outstanding shares of Class B Common Stock, has agreed to waive its right to receive any Anti-Dilution Shares in excess of the number of shares of Company Common Stock issuable pursuant to the Class B Share Ratio. In addition, the Sponsor has agreed in the Letter Agreement to forfeit and surrender, after the closing of the Merger, a number of REE Class A Ordinary Shares equal to (i) 1,500,000 if First Day Trading Price is less than $13.00, (ii) 1,000,000 if the First Trading Day Price equals or exceeds $13.00 but is less than $16.00, (iii) 500,000 if the First Trading Day Price equals or exceeds $16.00 but is less than $20.00, and (iv) if the First Trading Day Price equals or exceeds $20.00.

In addition, the Letter Agreement provides that the trading restrictions with respect to the Sponsor’s shares of 10X Capital Common Stock set forth in the Investors’ Rights Agreement supersede the trading restrictions set forth in the Letter Agreement dated November 24, 2020, among the Company, the Sponsor, and the Insiders.

CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

The following discussion is a summary of the material U.S. federal income tax considerations of the Merger to U.S. Holders (as defined below) of 10X Capital Common Stock and 10X Capital Warrants (collectively “10X Capital securities”). The following discussion also summarizes the material U.S. federal income tax consequences to U.S. Holders and Non-U.S. Holders (as defined below) of 10X Capital Common Stock that elect to have their common stock redeemed for cash and the material U.S. federal income tax consequences of the ownership and disposition of REE Class A Ordinary Shares and REE warrants following the Merger. This discussion applies only to the 10X Capital securities, REE Class A Ordinary Shares, and REE warrants, as the case may be, that are held as “capital assets” within the meaning of Section 1221 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) (generally, property held for investment).

The following does not purport to be a complete analysis of all potential tax effects arising in connection with the closing of the Merger, the redemption of 10X Capital Common Stock, or the ownership and disposition of REE Class A Ordinary Shares and REE warrants. The effects of other U.S. federal tax laws, such as estate and gift tax laws, and any applicable state, local, or non-U.S. tax laws are not discussed. This discussion is based on the Code, Treasury regulations promulgated thereunder, judicial decisions, and published rulings and administrative pronouncements of the U.S. Internal Revenue Service (the “IRS”), in each case in effect as of the date hereof. These authorities may change or be subject to differing interpretations. Any such change or differing interpretation may be applied retroactively in a manner that could adversely affect the tax consequences discussed below. 10X Capital and REE have not sought and will not seek any rulings from the IRS regarding the matters discussed below. There can be no assurance the IRS will not take or a court will not sustain a contrary position regarding the tax consequences discussed below.

This discussion does not address the tax treatment of REE Class A Ordinary Shares or REE warrants to be issued to holders of outstanding REE Preferred Shares in connection with the Merger. This discussion does not address all U.S. federal income tax consequences relevant to a holder’s particular circumstances, including the impact of the Medicare contribution tax on net investment income and the alternative minimum tax. In addition, it does not address consequences relevant to holders subject to special rules, including, without limitation:

•        banks, insurance companies, and certain other financial institutions;

•        regulated investment companies and real estate investment trusts;

•        brokers, dealers, or traders in securities;

•        traders in securities that elect to mark to market;

•        tax-exempt organizations or governmental organizations;

•        U.S. expatriates and former citizens or long-term residents of the U.S.;

•        persons holding 10X Capital securities or REE Class A Ordinary Shares and/or REE warrants, as the case may be, as part of a hedge, straddle, constructive sale, or other risk reduction strategy or as part of a conversion transaction or other integrated or similar transaction;

•        persons subject to special tax accounting rules as a result of any item of gross income with respect to 10X Capital securities or REE Class A Ordinary Shares and/or REE warrants, as the case may be, being taken into account in an applicable financial statement;

•        persons that actually or constructively own 5% or more (by vote or value) of the outstanding 10X Capital Common Stock or, after the Merger, the issued REE Class A Ordinary Shares;

•        founders, sponsors, officers or directors of 10X Capital or holders of private placement warrants;

•        “controlled foreign corporations,” “passive foreign investment companies,” and corporations that accumulate earnings to avoid U.S. federal income tax (and their shareholders);

•        S corporations, partnerships, or other entities or arrangements treated as partnerships or other flow-through entities for U.S. federal income tax purposes (and investors therein);

•        U.S. Holders having a functional currency other than the U.S. dollar;

•        persons who hold or received 10X Capital securities or REE Class A Ordinary Shares and/or REE warrants, as the case may be, pursuant to the exercise of any employee stock option or otherwise as compensation; and

•        tax-qualified retirement plans.

In addition, this summary does not address any tax consequences to investors that directly or indirectly hold equity interests in REE prior to the Merger, including holders of 10X Capital securities that also hold, directly or indirectly, equity interests in REE. With respect to the consequences of holding REE Class A Ordinary Shares, this discussion is limited to holders who acquire such REE Class A Ordinary Shares in connection with the Merger or as a result of the exercise of a REE warrant. With respect to the consequences of holding REE warrants, this discussion is limited to holders who held 10X Capital Warrants prior to and through the Merger.

If an entity or arrangement treated as a partnership for U.S. federal income tax purposes holds 10X Capital securities, REE Class A Ordinary Shares and/or REE warrants, the tax treatment of an owner of such entity will depend on the status of the owner or participant in the arrangement, the activities of the entity or arrangement, and certain determinations made at the owner or participant level. Accordingly, entities or arrangements treated as partnerships for U.S. federal income tax purposes and the partners in such partnerships should consult their tax advisors regarding the U.S. federal income tax consequences to them.

For purposes of this discussion, because any 10X Capital Unit consisting of one share of 10X Capital Common Stock and one-half of one 10X Capital Warrant is separable at the option of the holder, 10X Capital is treating any share of 10X Capital Common Stock and portion of one 10X Capital Warrant held by a holder in the form of a single 10X Capital Unit as separate instruments and is assuming that the 10X Capital Unit itself will not be treated as an integrated instrument. Under this treatment the separation of a 10X Capital Unit in connection with the consummation of the Merger generally would not be a taxable event for U.S. federal income tax purposes. This position is not free from doubt, and no assurance can be given that the IRS would not assert, or that a court would not sustain, a contrary position. Holders of 10X Capital Units and 10X Capital securities are urged to consult their tax advisors concerning the U.S. federal, state, local, and foreign tax consequences of the transactions contemplated by the Merger (including any redemption of 10X Capital Common Stock for cash) with respect to any 10X Capital securities held through a 10X Capital Unit (including alternative characterizations of a 10X Capital Unit).

For purposes of this discussion, a “U.S. Holder” is any beneficial owner of shares of 10X Capital securities, REE Class A Ordinary Shares and/or REE warrants, as the case may be, that is for U.S. federal income tax purposes:

•        an individual who is a citizen or resident of the U.S.;

•        a corporation (or other entity taxable as a corporation) created or organized in, or under the laws of, the U.S., any state thereof, or the District of Columbia;

•        an estate, the income of which is subject to U.S. federal income tax regardless of its source; or

•        a trust that (1) is subject to the primary supervision of a U.S. court and the control of one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code) or (2) has a valid election in effect to be treated as a United States person for U.S. federal income tax purposes.

THE U.S. FEDERAL INCOME TAX TREATMENT OF THE MERGER AND THE U.S. FEDERAL INCOME TAX TREATMENT TO HOLDERS OF 10X CAPITAL SECURITIES DEPEND IN SOME INSTANCES ON DETERMINATIONS OF FACT AND INTERPRETATIONS OF COMPLEX PROVISIONS OF U.S. FEDERAL INCOME TAX LAW FOR WHICH NO CLEAR PRECEDENT OR AUTHORITY MAY BE AVAILABLE. IN ADDITION, THE U.S. FEDERAL INCOME TAX TREATMENT OF THE MERGER, THE EXERCISE OF REDEMPTION RIGHTS WITH RESPECT TO 10X CAPITAL COMMON STOCK, AND THE OWNERSHIP AND DISPOSITION OF REE CLASS A ORDINARY SHARES AND/OR REE WARRANTS TO ANY PARTICULAR HOLDER WILL DEPEND ON THE HOLDER’S PARTICULAR TAX CIRCUMSTANCES. YOU ARE URGED TO CONSULT YOUR TAX ADVISOR REGARDING THE U.S. FEDERAL, STATE, LOCAL, AND NON-U.S. INCOME AND OTHER TAX CONSEQUENCES TO YOU, IN LIGHT OF YOUR PARTICULAR INVESTMENT OR TAX CIRCUMSTANCES, OF THE MERGER, THE EXERCISE OF YOUR REDEMPTION RIGHTS WITH RESPECT TO 10X CAPITAL COMMON STOCK, AND THE OWNERSHIP AND DISPOSITION OF REE CLASS A ORDINARY SHARES AND/OR REE WARRANTS.

U.S. Federal Income Tax Treatment of REE

Tax Residence of REE for U.S. Federal Income Tax Purposes

Although REE is incorporated and tax resident in Israel, the IRS may assert that it should be treated as a U.S. corporation for U.S. federal income tax purposes pursuant to Section 7874 of the Code. For U.S. federal income tax purposes, a corporation is generally considered a U.S. “domestic” corporation if it is created or organized in or under the laws of the U.S., any state thereof, or the District of Columbia. Because REE is not so created or organized (but is instead incorporated only in Israel), it would generally be classified as a foreign corporation (that is, a corporation other than a U.S. “domestic” corporation) under these rules. Section 7874 of the Code provides an exception under which a corporation created or organized only under foreign law may, in certain circumstances, be treated as a U.S. corporation for U.S. federal income tax purposes. The Section 7874 rules are complex and require analysis of all relevant facts, and there is limited guidance and significant uncertainties as to their application.

Under Code Section 7874, a corporation created or organized outside the U.S. (i.e., a foreign corporation) will nevertheless be treated as a U.S. corporation for U.S. federal income tax purposes when (i) the foreign corporation directly or indirectly acquires substantially all of the assets held directly or indirectly by a U.S. corporation (including the indirect acquisition of assets of the U.S. corporation by acquiring the outstanding shares of the U.S. corporation), (ii) the shareholders of the acquired U.S. corporation hold, by vote or value, at least 80% of the shares of the foreign acquiring corporation after the acquisition by reason of holding shares in the U.S. acquired corporation (the “Section 7874 Percentage”), and (iii) the foreign corporation’s “expanded affiliated group” does not have substantial business activities in the foreign corporation’s country of creation or organization relative to such expanded affiliated group’s worldwide activities (the “Substantial Business Activities Exception”). In order to satisfy the Substantial Business Activities Exception, at least 25% of the employees (by headcount and compensation), real and tangible assets, and gross income of the foreign acquiring corporation’s “expanded affiliated group” must be based, incurred, located, and derived, respectively, in the country in which the foreign acquiring corporation is created or organized. The Section 7874 Regulations further provide for a number of special rules that aggregate multiple acquisitions of U.S. corporations for purposes of Code Section 7874 that are made as part of a plan or made over a 36-month period, making it more likely that Code Section 7874 will apply to a foreign acquiring corporation.

REE will indirectly acquire substantially all of the assets of 10X Capital through the Merger. As a result, Section 7874 of the Code may apply to cause REE to be treated as a U.S. corporation for U.S. federal income tax purposes following the Merger depending on whether the Section 7874 Percentage equals or exceeds 80%, subject to the applicability of the Substantial Business Activities Exception.

Based upon the terms of the Merger, the rules for determining share ownership under Code Section 7874 and the Section 7874 Regulations, and certain factual assumptions, 10X Capital and REE currently expect that the Section 7874 Percentage of 10X Capital stockholders in REE should be less than 80% after the Merger. Accordingly, REE is not expected to be treated as a U.S. corporation for U.S. federal income tax purposes under Section 7874 of the Code. The calculation of the Section 7874 Percentage is complex, is subject to detailed regulations (the application of which is uncertain in various respects and could be impacted by changes in U.S. tax laws and regulations with possible retroactive effect), and is subject to certain factual uncertainties. Whether the Section 7874 Percentage is less than 80% must be finally determined after completion of the Merger, by which time there could be adverse changes to the relevant facts and circumstances. Moreover, former holders of 10X Capital Common Stock may be deemed to own an amount of REE Class A Ordinary Shares in respect to certain redemptions by former holders of 10X Capital Common Stock prior to the Merger for purposes of determining the ownership percentage of former holders of 10X Capital Common Stock under Section 7874 of the Code. Accordingly, there can be no assurance that the IRS will not challenge the status of REE as a foreign corporation under Code Section 7874 or that such challenge would not be sustained by a court.

If the IRS were to successfully challenge under Code Section 7874 REE’s status as a foreign corporation for U.S. federal income tax purposes, REE and certain REE shareholders could be subject to significant adverse tax consequences, including a higher effective corporate income tax rate on REE and future withholding taxes on certain REE shareholders. In particular, holders of REE Class A Ordinary Shares and/or REE warrants would be treated as holders of stock and warrants of a U.S. corporation.

However, even if the Section 7874 Percentage was such that REE were still respected as a foreign corporation under Code Section 7874, REE may be limited in using its equity to engage in future acquisitions of U.S. corporations over a 36-month period following the Merger. If REE were to be treated as acquiring substantially all of the assets of a

U.S. corporation within a 36-month period after the Merger, the Section 7874 Regulations would exclude certain shares of REE attributable to the Merger for purposes of determining the Section 7874 Percentage of that subsequent acquisition, making it more likely that Code Section 7874 would apply to such subsequent acquisition.

The remainder of this discussion assumes that REE will not be treated as a U.S. corporation for U.S. federal income tax purposes under Section 7874 of the Code.

Utilization of 10X Capital’s Tax Attributes and Certain Other Adverse Tax Consequences to REE and REE’s Shareholders.

Following the acquisition of a U.S. corporation by a foreign corporation, Code Section 7874 can limit the ability of the acquired U.S. corporation and its U.S. affiliates to use U.S. tax attributes (including net operating losses and certain tax credits) to offset U.S. taxable income resulting from certain transactions, as well as result in certain other adverse tax consequences, even if the acquiring foreign corporation is respected as a foreign corporation for purposes of Code Section 7874. Specifically, Code Section 7874 can apply in this manner if (i) the foreign corporation acquires, directly or indirectly, substantially all of the properties held directly or indirectly by a U.S. corporation, (ii) after the acquisition, the former shareholders of the acquired U.S. corporation hold at least 60% (by either vote or value) but less than 80% (by vote and value) of the shares of the foreign acquiring corporation by reason of holding shares in the acquired U.S. corporation, and (iii) the foreign corporation’s “expanded affiliated group” does not meet the Substantial Business Activities Exception.

Based upon the terms of the Merger, the rules for determining share ownership under Section 7874 of the Code and the Section 7874 Regulations, and certain factual assumptions, 10X Capital and REE currently expect that the Section 7874 Percentage should be less than 60% after the Merger. Accordingly, the limitations and other rules described above are not expected to apply to REE or 10X Capital after the Merger.

If the Section 7874 Percentage applicable to the Merger is at least 60% but less than 80%, REE and certain of REE’s shareholders may be subject to adverse tax consequences including, but not limited to, restrictions on the use of tax attributes with respect to “inversion gain” recognized over a 10-year period following the transaction, disqualification of dividends paid from preferential “qualified dividend income” rates, and the requirement that any U.S. corporation owned by REE include as “base erosion payments” that may be subject to a minimum U.S. federal income tax any amounts treated as reductions in gross income paid to certain related foreign persons. Furthermore, certain “disqualified individuals” (including officers and directors of a U.S. corporation) may be subject to an excise tax on certain stock-based compensation at a rate of 20%. However, as a blank check company whose assets are primarily comprised of cash and cash equivalents, it is not expected that 10X Capital will have a significant amount of inversion gain as a result of the Merger.

The determination that the Section 7874 Percentage should be less than 60% after the Merger is subject to detailed regulations (the application of which is uncertain in various respects and would be impacted by future changes in tax laws and regulations, with possible retroactive effect) and is subject to certain factual uncertainties. Whether the Section 7874 Percentage is less than 60% must be finally determined after completion of the Merger, by which time there could be adverse changes to the relevant facts and circumstances. There can be no assurance that the IRS will not challenge whether REE is subject to the above rules or that such a challenge would not be sustained by a court. If the IRS successfully applied these rules to REE, significant adverse tax consequences could result for REE and for certain REE shareholders, including a higher effective corporate tax rate on REE U.S. Holders.

U.S. Federal Income Tax Considerations of the Merger

Tax Consequences of the Merger Under Section 368(a) of the Code

The parties to the Merger intend that the Merger qualifies as a reorganization within the meaning of Section 368(a) of the Code (a “reorganization”). To qualify as a reorganization, a transaction must satisfy certain requirements, including, among others, that the acquiring corporation (or, in the case of certain reorganizations structured similarly to the Merger, its corporate parent) continue, either directly or indirectly through certain controlled corporations, either a significant line of the acquired corporation’s historic business or use a significant portion of the acquired corporation’s historic business assets in a business, in each case, within the meaning of Treasury regulations Section 1.368-1(d). However, due to the absence of guidance bearing directly on how the above rules apply in the case of an acquisition of

a corporation with investment-type assets, such as 10X Capital, the qualification of the Merger as a reorganization is not free from doubt. Moreover, the closing of the Merger is not conditioned upon the receipt of an opinion of counsel that the Merger will qualify as a reorganization, and neither 10X Capital nor REE intends to request a ruling from the IRS regarding the U.S. federal income tax treatment of the Merger. Accordingly, no assurance can be given that the IRS will not challenge the Merger’s qualification as a reorganization or that a court will not sustain such a challenge by the IRS. U.S. Holders of 10X Capital securities are urged to consult their tax advisors regarding the proper U.S. federal income tax treatment of the Merger, including with respect to its qualification as a “reorganization.”

If, notwithstanding the above, at the Effective Time any requirement for the application of Code Section 368(a) is not met, a U.S. Holder of 10X Capital securities generally would recognize gain or loss in an amount equal to the difference, if any, between the fair market value as of the closing date of the Merger of REE Class A Ordinary Shares and/or REE warrants received by such holder in the Merger over such holder’s adjusted tax basis in the 10X Capital securities surrendered by such holder in the Merger. Any gain or loss so recognized would generally be long-term capital gain or loss if the U.S. Holder had held the 10X Capital securities for more than one year (or short-term capital gain otherwise). Long-term capital gains of non-corporate U.S. Holders (including individuals) currently are eligible for preferential U.S. federal income tax rates. However, the deductibility of capital losses is subject to limitations. A U.S. Holder’s initial tax basis in the REE Class A Ordinary Shares and/or REE warrants received in the Merger will equal the fair market value of such stock or warrants upon receipt. A U.S. Holder’s holding period in the REE Class A Ordinary Shares and/or REE warrants received in the Merger, if any, will begin on the day following the closing date of the Merger and would not include the holding period for the 10X Capital securities surrendered in exchange therefor.

Tax Consequences of the Merger Under Section 367(a) of the Code

Section 367(a) of the Code and the Treasury regulations promulgated thereunder provide that, where a U.S. person exchanges stock or securities in a U.S. corporation for stock or securities in a foreign corporation in a transaction that qualifies as a reorganization, the U.S. person is required to recognize any gain (but not loss) realized on such exchange unless certain additional requirements are satisfied.

In general, for the Merger to meet these additional requirements, certain reporting requirements must be satisfied and (i) no more than 50% of both the total voting power and the total value of the stock of the transferee foreign corporation is received, in the aggregate, by the “U.S. transferors” (as defined in the Treasury regulations and computed taking into account direct, indirect and constructive ownership) in the transaction; (ii) no more than 50% of each of the total voting power and the total value of the stock of the transferee foreign corporation is owned, in the aggregate, immediately after the transaction by “U.S. persons” (as defined in the Treasury regulations) that are either officers or directors or “five-percent target shareholders” (as defined in the Treasury regulations and computed taking into account direct, indirect and constructive ownership) of the transferred U.S. corporation; and (iii) the “active trade or business test” as defined in Treasury regulations Section 1.367(a)-3(c)(3) must be satisfied. Conditions (i), (ii), and (iii) are expected to be met, and, as a result, the Merger is expected to satisfy the applicable requirements under Section 367(a) of the Code on account of such conditions. Accordingly, it is intended that the Merger does not result in gain recognition by a U.S. Holder exchanging 10X Capital Common Stock for REE Class A Ordinary Shares so long as either (A) the U.S. Holder is not a “five-percent transferee shareholder” (as defined in the Treasury regulations and computed taking into account direct, indirect and constructive ownership) of the transferee foreign corporation (by total voting power or by total value) or (B) the U.S. Holder is a “five-percent transferee shareholder” of the transferee foreign corporation and enters into an agreement with the IRS to recognize gain under certain circumstances. All U.S. Holders that will own 5% or more of either the total voting power or the total value of the outstanding shares of REE after the Merger (taking into account, for this purpose, ownership of REE Class A Ordinary Shares acquired in connection with the Merger and any REE Class A Ordinary Shares not acquired in connection with the Merger) may want to enter into a valid “gain recognition agreement” under applicable Treasury regulations and are strongly urged to consult their own tax advisors to determine the particular consequences to them of the Merger.

Whether the requirements described above are met will depend on facts existing at the Effective Time, and the closing of the Merger is not conditioned upon the receipt of an opinion of counsel or ruling from the IRS that the Merger will not result in gain being recognized by U.S. Holders of 10X Capital securities under Section 367(a) of the Code. In addition, no assurance can be given that the IRS will not challenge the satisfaction of the relevant requirements under Section 367(a) of the Code and the Treasury regulations promulgated thereunder with respect to the Merger or that a court would not sustain such a challenge.

If the Merger does meet the requirements of Section 368(a) of the Code but, at the Effective Time, any requirement for Section 367(a) of the Code not to impose gain on a U.S. Holder is not satisfied, then a U.S. Holder of 10X Capital securities generally would recognize gain (but not loss) in an amount equal to the excess, if any, of the fair market value as of the closing date of the Merger of the REE Class A Ordinary Shares and/or REE warrants received by such holder in the Merger over such U.S. Holder’s tax basis in the 10X Capital securities surrendered by such U.S. Holder in the Merger. Any gain so recognized would generally be long-term capital gain if the U.S. Holder had held the 10X Capital securities for more than one year at the Effective Time (or short-term capital gain otherwise). Long-term capital gain of non-corporate U.S. Holders (including individuals) currently is eligible for preferential U.S. federal income tax rates. A U.S. Holder’s initial tax basis in the REE Class A Ordinary Shares and/or REE warrants received in the Merger will equal the fair market value of such stock or warrants upon receipt. A U.S. Holder’s holding period in the REE Class A Ordinary Shares and/or REE warrants received in the Merger may not be able to include the holding period for the 10X Capital securities surrendered in exchange therefor. In such case, the holding period will begin on the day following the closing date of the Merger.

The rules dealing with Section 367(a) of the Code discussed above are very complex and are affected by various factors in addition to those described above. Accordingly, you are strongly urged to consult your tax advisor concerning the application of these rules to your exchange of 10X Capital securities under your particular circumstances, including whether you will be a five-percent transferee shareholder and the possibility of entering into a “gain recognition agreement” under applicable Treasury regulations.

U.S. Holders exchanging 10X Capital Securities for REE Class A Ordinary Shares and/or REE Warrants

If the Merger qualifies as a reorganization under Section 368(a) of the Code and is not taxable under Section 367(a) of the Code, as is intended by the parties, a U.S. Holder generally would not recognize gain or loss if, pursuant to the Merger, the U.S. Holder either (i) exchanges only 10X Capital Common Stock (but not 10X Capital Warrants) for REE Class A Ordinary Shares, (ii) exchanges 10X Capital Warrants for REE warrants, or (iii) both exchanges 10X Capital Common Stock for REE Class A Ordinary Shares and exchanges its 10X Capital Warrants for REE warrants.

In such a case, the aggregate tax basis of the REE Class A Ordinary Shares received by a U.S. Holder in the Merger should be equal to the aggregate adjusted tax basis of 10X Capital Common Stock surrendered in exchange therefor. The tax basis in a REE warrant received by a U.S. Holder in the Merger should be equal to the adjusted tax basis of the 10X Capital Warrant exchanged therefor. The holding period of the REE Class A Ordinary Shares and/or REE warrants received by a U.S. Holder in the Merger should include the period during which the 10X Capital Common Stock and/or 10X Capital Warrants exchanged therefor were held by such U.S. Holder. It is unclear whether the redemption rights with respect to the 10X Capital Common Stock may suspend the running of the applicable holding period for this purpose.

U.S. Holders Exercising Redemption Rights with Respect to 10X Capital Common Stock

In the event that a U.S. Holder’s shares of 10X Capital Common Stock are redeemed for cash pursuant to the redemption provisions described herein, the treatment of such redemption for U.S. federal income tax purposes will depend on whether the redemption qualifies as a sale of stock under Section 302 of the Code. Whether a redemption qualifies for sale treatment will depend largely on the total number of shares of 10X Capital Common Stock treated as held by the U.S. Holder relative to all of the shares of 10X Capital Common Stock outstanding both before and after the redemption.

The redemption of 10X Capital Common Stock generally will be treated as a sale of stock (rather than as a corporate distribution) if the redemption (i) results in a “complete termination” of the U.S. Holder’s interest in 10X Capital, (ii) is “substantially disproportionate” with respect to the U.S. Holder or (iii) is “not essentially equivalent to a dividend” with respect to the U.S. Holder. These tests are explained more fully below.

In determining whether any of the foregoing tests are satisfied, a U.S. Holder generally should take into account not only 10X Capital Common Stock actually owned by such U.S. Holder but also 10X Capital Common Stock constructively owned by such holder. A U.S. Holder may constructively own, in addition to shares owned directly, shares owned by certain related individuals and entities in which the U.S. Holder has an interest or that have an interest in such U.S. Holder, as well as any shares the U.S. Holder has a right to acquire by exercise of an option, which would generally include 10X Capital Common Stock or REE Class A Ordinary Shares which could be directly or constructively acquired pursuant to the exercise of 10X Capital Warrants or REE warrants.

There will be a complete termination of a U.S. Holder’s interest if either (i) all of 10X Capital Common Stock actually and constructively owned by the U.S. Holder is redeemed or (ii) all of 10X Capital Common Stock actually owned by the U.S. Holder is redeemed and the U.S. Holder is eligible to waive, and effectively waives in accordance with specific rules, the attribution of shares owned by certain family members and the U.S. Holder does not constructively own any other shares. In order to meet the “substantially disproportionate” test, the percentage of outstanding voting stock actually or constructively owned by a U.S. Holder immediately following the redemption generally must be less than (a) 80% of the percentage of outstanding voting stock actually or constructively owned by such U.S. Holder immediately prior to the redemption (b) 50% of the total combined voting power of 10X Capital Common Stock. The redemption of 10X Capital Common Stock will not be essentially equivalent to a dividend if a U.S. Holder’s redemption results in a “meaningful reduction” of the U.S. Holder’s proportionate interest in 10X Capital. Whether the redemption will result in a meaningful reduction in a U.S. Holder’s proportionate interest in 10X Capital will depend on the particular facts and circumstances. However, the IRS has indicated in a published ruling that even a small reduction in the proportionate interest of a small minority shareholder in a publicly held corporation who exercises no control over corporate affairs may constitute such a “meaningful reduction.” U.S. Holders should consult with their tax advisors as to the tax consequences of a redemption.

If the redemption qualifies as a sale of stock by the U.S. Holder under Section 302 of the Code, the U.S. Holder would generally be required to recognize gain or loss in an amount equal to the difference, if any, between the amount of cash received and the tax basis of the shares of 10X Capital Common Stock redeemed. Such gain or loss generally would be treated as capital gain or loss if such shares were held as a capital asset on the date of the redemption. A U.S. Holder’s tax basis in such holder’s 10X Capital Common Stock generally will equal the cost of such shares.

If the redemption does not qualify as a sale of stock under Section 302 of the Code, then the U.S. Holder will be treated as receiving a corporate distribution. Such distribution generally will constitute a dividend for U.S. federal income tax purposes to the extent paid from current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of current and accumulated earnings and profits will constitute a return of capital that will be applied against and reduce (but not below zero) the U.S. Holder’s adjusted tax basis in such U.S. Holder’s 10X Capital Common Stock. Any remaining excess will be treated as gain realized on the sale or other disposition of 10X Capital Common Stock.

Amounts treated as dividends that 10X Capital pays to a U.S. Holder that is treated a taxable corporation generally will qualify for the dividends received deduction if the requisite holding period is satisfied. With certain exceptions (including, but not limited to, dividends treated as investment income for purposes of investment interest deduction limitations), and provided certain holding period requirements are met, amounts treated as dividends that 10X Capital pays to a non-corporate U.S. Holder may be taxed as “qualified dividend income” at the preferential tax rate accorded to long-term capital gains. It is unclear whether the redemption rights described herein with respect to the 10X Capital Common Stock may have suspended the running of the applicable holding period for these purposes. If the holding period requirements are not satisfied, then a corporation may not be able to qualify for the dividends received deduction and would have taxable income equal to the entire dividend amount and non-corporate U.S. Holders may be subject to tax on such dividend at regular ordinary income tax rates instead of the preferential rate that applies to “qualified dividend income.”

After the application of those rules, any remaining tax basis of the U.S. Holder in the redeemed 10X Capital Common Stock will be added to the U.S. Holder’s adjusted tax basis in its remaining 10X Capital Common Stock, or, if it has none, to the U.S. Holder’s adjusted tax basis in its 10X Capital Warrants or possibly in other shares of 10X Capital Common Stock constructively owned by it.

U.S. Federal Income Tax Consequences of the Ownership and Disposition of REE Class A Ordinary Shares and REE Warrants to U.S. Holders

Distributions on REE Class A Ordinary Shares

If REE makes distributions of cash or property on the REE Class A Ordinary Shares, such distributions will be treated first as a dividend to the extent of REE’s current and accumulated earnings and profits (as determined for U.S. federal income tax purposes), and then as a tax-free return of capital to the extent of the U.S. Holder’s tax basis, with any excess treated as gain from the sale or exchange of the shares. The amount of any such distribution will include any amounts withheld by REE (or another applicable withholding agent). If REE does not provide calculations of its

earnings and profits under U.S. federal income tax principles, a U.S. Holder should expect all cash distributions to be reported as dividends for U.S. federal income tax purposes. Any dividend will not be eligible for the dividends received deduction allowed to corporations in respect of dividends received from U.S. corporations.

Subject to the discussions above under “— Utilization of 10X Capital’s Tax Attributes and Certain Other Adverse Tax Consequences to REE and REE’s Shareholders” and below under “— Passive Foreign Investment Company Rules,” dividends received by certain non-corporate U.S. Holders (including individuals) may be “qualified dividend income,” which is taxed at the lower applicable capital gains rate, provided that:

•        either (a) the shares are readily tradable on an established securities market in the U.S. or (b) REE is eligible for the benefits of a qualifying income tax treaty with the U.S. that includes an exchange of information program;

•        REE is neither a PFIC (as discussed below under below under “— Passive Foreign Investment Company Rules”) nor treated as such with respect to the U.S. Holder for REE’s taxable year in which the dividend is paid or the preceding taxable year;

•        the U.S. Holder satisfies certain holding period requirements;

•        the U.S. Holder is not under an obligation to make related payments with respect to positions in substantially similar or related property; and

•        the taxpayer does not take the dividends into account as investment income under Code Section 163(d)(4)(B).

There can be no assurances that REE will be eligible for benefits of an applicable comprehensive income tax treaty between the U.S. and Israel. In addition, there also can be no assurance that REE Class A Ordinary Shares will be considered “readily tradable” on an established securities market in accordance with applicable legal authorities. Furthermore, REE will not constitute a qualified foreign corporation for purposes of these rules if it is a PFIC for the taxable year in which it pays a dividend or for the preceding taxable year. See “— Passive Foreign Investment Company Rules.” U.S. Holders should consult their tax advisors regarding the availability of the lower rate for dividends paid with respect to REE Class A Ordinary Shares.

The amount of any dividend distribution paid in foreign currency will be the U.S. dollar amount calculated by reference to the applicable exchange rate in effect on the date of actual or constructive receipt, regardless of whether the payment is in fact converted into U.S. dollars at that time. A U.S. Holder may have foreign currency gain or loss if the dividend is converted into U.S. dollars after the date of receipt.

Subject to certain exceptions, dividends on REE Class A Ordinary Shares will constitute foreign source income for foreign tax credit limitation purposes. If the dividends are qualified dividend income (as discussed above), the amount of the dividend taken into account for purposes of calculating the foreign tax credit limitation will be limited to the gross amount of the dividend, multiplied by a fraction, the numerator of which is the reduced rate applicable to qualified dividend income and the denominator of which is the highest rate of tax normally applicable to dividends. The limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. For this purpose, dividends distributed by REE with respect to the REE Class A Ordinary Shares generally will constitute “passive category income” but could, in the case of certain U.S. Holders, constitute “general category income”. The rules governing foreign tax credits are complex and U.S. Holders are urged to consult their tax advisors regarding the creditability of foreign taxes in their particular circumstances. In lieu of claiming a foreign tax credit, a U.S. Holder may, in certain circumstances, deduct foreign taxes in computing the holder’s taxable income, subject to generally applicable limitations under U.S. law. Generally, an election to deduct foreign taxes instead of claiming foreign tax credits applies to all foreign taxes paid or accrued in the taxable year.

Sale, Exchange, Redemption or Other Taxable Disposition of REE Class A Ordinary Shares and REE Warrants

Subject to the discussion below under “— Passive Foreign Investment Company Rules,” a U.S. Holder generally will recognize gain or loss on any sale, exchange, redemption or other taxable disposition of REE Class A Ordinary Shares or REE warrants in an amount equal to the difference between (i) the amount realized on the disposition and (ii) such U.S. Holder’s adjusted tax basis in such shares and/or warrants. Any gain or loss recognized by a U.S. Holder

on a taxable disposition of REE Class A Ordinary Shares or REE warrants generally will be capital gain or loss. A non-corporate U.S. Holder, including an individual, who has held the REE Class A Ordinary Shares and/or REE warrants for more than one year generally will be eligible for reduced tax rates for such long-term capital gains. The deductibility of capital losses is subject to limitations.

Any such gain or loss recognized generally will be treated as U.S. source income or loss. Accordingly, in the event any Israeli tax (including withholding tax) is imposed upon such sale or other disposition, a U.S. Holder may not be able to utilize foreign tax credits unless such holder has foreign source income or gain in the same category from other sources. Moreover, there are special rules under the income tax treaty between the U.S. and Israel (the “Treaty”), which may impact a U.S. Holder’s ability to claim a foreign tax credit. U.S. Holders are urged to consult their tax advisor regarding the ability to claim a foreign tax credit and the application of the Treaty to such U.S. Holder’s particular circumstances.

Exercise, Lapse, or Redemption of a REE Warrant

Subject to the PFIC rules discussed below, a U.S. Holder generally will not recognize gain or loss upon the acquisition of a REE ordinary share on the exercise of a REE warrant for cash. A U.S. Holder’s tax basis in a REE Class A Ordinary Shares received upon exercise of the REE warrant generally should be an amount equal to the sum of the U.S. Holder’s tax basis in the 10X Capital Warrant exchanged therefor (assuming the Merger is not a taxable transaction, as discussed above) and the exercise price. The U.S. Holder’s holding period for a REE Class A Ordinary Share received upon exercise of the REE warrant will begin on the date following the date of exercise (or possibly the date of exercise) of the REE warrant and will not include the period during which the U.S. Holder held the REE warrant. If a REE warrant is allowed to lapse unexercised, a U.S. Holder generally will recognize a capital loss equal to such holder’s tax basis in the REE warrant.

The tax consequences of a cashless exercise of a REE warrant are not clear under current tax law. Subject to the PFIC rules discussed below, a cashless exercise may be tax-deferred, either because the exercise is not a gain realization event or because the exercise is treated as a recapitalization for U.S. federal income tax purposes. In either tax-deferred situation, a U.S. Holder’s basis in the REE Class A Ordinary Shares received generally would equal the U.S. Holder’s basis in the REE warrants exercised therefor. If the cashless exercise is not treated as a gain realization event, a U.S. Holder’s holding period in the REE Class A Ordinary Shares would be treated as commencing on the date following the date of exercise (or possibly the date of exercise) of the REE warrants and will not include the period during which the U.S. Holder held the REE warrants. If the cashless exercise were treated as a recapitalization, the holding period of the REE Class A Ordinary Shares would include the holding period of the REE warrants exercised therefor.

It is also possible that a cashless exercise of a REE warrant could be treated in part as a taxable exchange in which gain or loss would be recognized in the manner set forth above under “— Sale, Exchange, Redemption or Other Taxable Disposition of REE Class A Ordinary Shares and REE Warrants.” In such event, a U.S. Holder could be deemed to have surrendered warrants equal to the number of REE Class A Ordinary Shares having an aggregate fair market value equal to the exercise price for the total number of warrants to be exercised. Subject to the PFIC rules discussed below, the U.S. Holder would recognize capital gain or loss with respect to the REE warrants deemed surrendered in an amount generally equal to the difference between (i) the fair market value of the REE Class A Ordinary Shares that would have been received in a regular exercise of the REE warrants deemed surrendered, net of the aggregate exercise price of such REE warrants and (ii) the U.S. Holder’s tax basis in such REE warrants. In this case, a U.S. Holder’s aggregate tax basis in the REE Class A Ordinary Shares received would equal the sum of (i) U.S. Holder’s tax basis in the REE warrants deemed exercised and (ii) the aggregate exercise price of such REE warrants. A U.S. Holder’s holding period for the REE Class A Ordinary Shares received in such case generally would commence on the date following the date of exercise (or possibly the date of exercise) of the REE warrants and will not include the period during which the U.S. Holder held the REE warrants.

Due to the absence of authority on the U.S. federal income tax treatment of a cashless exercise of warrants, including when a U.S. Holder’s holding period would commence with respect to the REE Class A Ordinary Share received, there can be no assurance regarding which, if any, of the alternative tax consequences and holding periods described above would be adopted by the IRS or a court of law. Accordingly, U.S. Holders should consult their tax advisors regarding the tax consequences of a cashless exercise of REE warrants.

Subject to the PFIC rules described below, if REE redeems REE warrants for cash pursuant to the redemption provisions described in the section of this registration statement entitled “— Description of REE Warrants — Public Shareholders’ Warrants” or if REE purchases REE warrants in an open market transaction, such redemption or purchase generally will be treated as a taxable disposition to the U.S. Holder, taxed as described above under “— Sale, Exchange, Redemption or Other Taxable Disposition of REE Class A Ordinary Shares and REE Warrants.”

Possible Constructive Distributions

The terms of each REE warrant provide for an adjustment to the number of REE Class A Ordinary Shares for which the REE warrant may be exercised or to the exercise price of the REE warrant in certain events, as discussed in the section of this registration statement captioned “Description of REE Warrants.” An adjustment which has the effect of preventing dilution generally is not taxable. A U.S. Holder of a REE warrant would, however, be treated as receiving a constructive distribution from REE if, for example, the adjustment increases the holder’s proportionate interest in REE’s assets or earnings and profits (for instance, through an increase in the number of REE Class A Ordinary Shares that would be obtained upon exercise of such warrant) as a result of a distribution of cash or other property such as other securities to the holders of the REE Class A Ordinary Shares which is taxable to the U.S. Holders of such shares as described under “— Distributions on REE Class A Ordinary Shares” above. Such constructive distribution would be subject to tax as described under that section in the same manner as if the U.S. Holder of such REE warrant received a cash distribution from REE equal to the fair market value of such increase in interest.

Passive Foreign Investment Company Rules

The treatment of U.S. Holders of the REE Class A Ordinary Shares and REE warrants could be materially different from that described above, if REE is treated as a “passive foreign investment company,” or PFIC, for U.S. federal income tax purposes. An entity treated as a foreign corporation for U.S. federal income tax purposes generally will be a PFIC for U.S. federal income tax purposes for any taxable year if either:

•        at least 75% of its gross income for such year is passive income (such as interest, dividends, rents and royalties (other than rents or royalties derived from the active conduct of a trade or business) and gains from the disposition of assets giving rise to passive income); or

•        at least 50% of the value of its assets (based on an average of the quarterly values of the assets) during such year is attributable to assets that produce passive income or are held for the production of passive income.

For this purpose, REE will be treated as owning its proportionate share of the assets and earning its proportionate share of the income of any other entity treated as a corporation for U.S. federal income tax purposes in which REE own, directly or indirectly, 25% or more (by value) of the stock.

Based on the current and anticipated composition of the income, assets and operations of REE and its subsidiaries, there is a substantial risk that REE will be a PFIC for U.S. federal income tax purposes for the taxable year that includes the Merger, and REE may be a PFIC for U.S. federal income tax purposes for future taxable years.

Nevertheless, whether REE is treated as a PFIC is determined on an annual basis. The determination of whether a non-U.S. corporation is a PFIC is a factual determination that depends on, among other things, the composition of REE’s income and assets, and the market value of its shares and assets, including the composition of income and assets and the market value of shares and assets of its subsidiaries, from time to time, and thus the determination can only be made annually after the close of each taxable year. Thus, no assurance can be given as to whether REE will be a PFIC in 2021 or for any future taxable year. In addition, REE’s U.S. counsel expresses no opinion with respect to REE’s PFIC status for 2021 or future taxable years.

Under the PFIC rules, if REE were considered a PFIC at any time that a U.S. Holder owns REE Class A Ordinary Shares or REE warrants, REE would generally continue to be treated as a PFIC with respect to such holder in a particular year unless (i) REE has ceased to be a PFIC and (ii) (a) the U.S. Holder has made a valid “QEF election” (as described below) for the first taxable year in which the holder owned such holder’s REE Class A Ordinary Shares in which REE was a PFIC, (b) a valid mark-to-market election (as described below) is in effect for the particular year, or (c) the U.S. Holder has made a “deemed sale” election under the PFIC rules. If such a “deemed sale” election is made, a U.S. Holder will be deemed to have sold its REE Class A Ordinary Shares at their fair market value on the last day of the last taxable year in which REE is classified as a PFIC, and any gain from such deemed sale would be subject to the consequences described below. After the “deemed sale” election, the REE Class A Ordinary Shares with respect to which the “deemed sale” election was made will not be treated as shares in a PFIC unless REE subsequently becomes a PFIC.

For each taxable year that REE is treated as a PFIC with respect to a U.S. Holder’s REE Class A Ordinary Shares or REE warrants, the U.S. Holder will be subject to special tax rules with respect to any “excess distribution” (as defined below) received and any gain realized from a sale or disposition (including a pledge of REE Class A Ordinary Shares and under proposed regulations transfers of REE warrants and certain transfers of REE Class A Ordinary Shares that would otherwise qualify as nonrecognition transactions for U.S. federal income tax purposes) of its REE Class A Ordinary Shares or REE warrants (collectively the “excess distribution rules”), unless, with respect to the REE Class A Ordinary Shares, the U.S. Holder makes a valid QEF or mark-to-market election as discussed below. Generally, distributions received by a U.S. Holder in a taxable year that are greater than 125% of the average annual distributions received by such U.S. Holder during the shorter of the three preceding taxable years or the portion of such U.S. Holder’s holding period for the REE Class A Ordinary Shares or REE warrants that preceded the taxable year of the distribution will be treated as excess distributions. Under these special tax rules:

•        the excess distribution or gain will be allocated ratably over the U.S. Holder’s holding period for the REE Class A Ordinary Shares or REE warrants;

•        the amount allocated to the U.S. Holder’s taxable year in which the U.S. Holder recognized the gain or received the excess distribution or to the period in the U.S. Holder’s holding period before the first day of REE’s first taxable year in which REE is a PFIC, will be treated as ordinary income; and

•        the amount allocated to each other taxable year (or portions thereof) of the U.S. Holder and included in such holder’s holding period will be subject to the highest tax rate in effect for individuals or corporations, as applicable, for each such year without regard to the U.S. Holder’s other items of income and loss for such year; and

•        the interest charge generally applicable to underpayments of tax will be imposed on the U.S. Holder with respect to the resulting tax attributable to each such year.

Under the excess distribution rules, the tax liability for amounts allocated to taxable years prior to the year of disposition or excess distribution cannot be offset by any net operating losses, and gains (but not losses) realized on the sale of the REE Class A Ordinary Shares or REE warrants cannot be treated as capital gains, even though the U.S. Holder holds the REE Class A Ordinary Shares or REE warrants as capital assets.

Certain of the PFIC rules may impact U.S. Holders with respect to equity interests in subsidiaries and other entities which REE may hold, directly or indirectly, that are PFICs (collectively, “Lower-Tier PFICs”). There can be no assurance, however, that REE does not own, or will not in the future acquire, an interest in a subsidiary or other entity that is or would be treated as a Lower-Tier PFIC. U.S. Holders should consult their tax advisors regarding the application of the PFIC rules to any of REE’s subsidiaries.

If REE is a PFIC, a U.S. Holder of shares in REE may avoid taxation under the excess distribution rules described above in respect to the REE Class A Ordinary Shares by making a timely and valid “qualified electing fund” (“QEF”) election (if eligible to do so). However, a U.S. Holder may make a QEF election with respect to its REE Class A Ordinary Shares only if REE provides U.S. Holders on an annual basis with certain financial information specified under applicable U.S. Treasury regulations, including the information provided in a PFIC Annual Information Statement. There can be no assurance, however, that REE will have timely knowledge of its status as a PFIC in the future or that REE will timely provide such information for such years. The failure to provide such information on an annual basis could prevent a U.S. Holder from making a QEF election or result in the invalidation or termination of a U.S. Holder’s prior QEF election.

A U.S. Holder that makes a QEF election with respect to its REE Class A Ordinary Shares would generally be required to include in income for each year that REE is treated as a PFIC the U.S. Holder’s pro rata share of REE’s ordinary earnings for the year (which would be subject to tax as ordinary income) and net capital gains for the year (which would be subject to tax at the rates applicable to long-term capital gains), without regard to the amount of any distributions made in respect of the REE Class A Ordinary Shares. Any net deficits or net capital losses of REE for a taxable year, however, would not be passed through and included on the tax return of the U.S. Holder. A U.S. Holder’s basis in the REE Class A Ordinary Shares would be increased by the amount of income inclusions under the QEF rules. Dividends actually paid on the REE Class A Ordinary Shares generally would not be subject to U.S. federal income tax to the extent of prior income inclusions and would reduce the U.S. Holder’s basis in the REE Class A Ordinary Shares by a corresponding amount. If REE owns any interests in a Lower-Tier PFIC, a U.S. Holder generally must make a separate QEF election for each Lower-Tier PFIC, subject to REE’s providing the relevant tax information for each Lower-Tier

PFIC on an annual basis. There can be no assurance that REE will have timely knowledge of the status of any such Lower-Tier PFIC. In addition, REE may not hold a controlling interest in any such Lower-Tier PFIC and thus there can be no assurance REE will be able to cause the Lower-Tier PFIC to provide such required information.

If a U.S. Holder does not make a QEF election effective from the first taxable year of a U.S. Holder’s holding period for the REE Class A Ordinary Shares in which REE is a PFIC (or a mark-to-market election, as discussed below), then the U.S. Holder generally will remain subject to the excess distribution rules. A U.S. Holder that first makes a QEF election in a later year may avoid the continued application of the excess distribution rules to its REE Class A Ordinary Shares by making a “deemed sale” election. In that case, the U.S. Holder will be deemed to have sold the REE Class A Ordinary Shares at their fair market value on the first day of the taxable year in which the QEF election becomes effective, and any gain from such deemed sale would be subject to the excess distribution rules described above. As a result of the “deemed sale” election, the U.S. Holder will have additional basis (to the extent of any gain recognized on the deemed sale) and, solely for purposes of the PFIC rules , a new holding period in the Class A ordinary shares.

It is not entirely clear how various aspects of the PFIC rules apply to the warrants. However, a U.S. Holder may not make a QEF election with respect to its REE warrants. As a result, if a U.S. Holder sells or otherwise disposes of such warrants (other than upon exercise of such warrants) and REE was a PFIC at any time during the U.S. Holder’s holding period of such warrants, any gain recognized generally will be treated as an excess distribution, taxed as described above.

If a U.S. Holder that exercises such warrants properly makes and maintains a QEF election with respect to the newly acquired REE Class A Ordinary Shares (or has previously made a QEF election with respect to the REE Class A Ordinary Shares), the QEF election will apply to the newly acquired REE Class A Ordinary Shares. Notwithstanding such QEF election, the rules relating to “excess distributions” discussed above, adjusted to take into account the current income inclusions resulting from the QEF election, will continue to apply with respect to such newly acquired REE Class A Ordinary Shares (which under proposed regulations will be deemed to have a holding period for purposes of the PFIC rules that includes the period the U.S. Holder held the REE warrants), unless the U.S. Holder makes a “deemed sale” election under the PFIC rules. U.S. Holders are urged to consult their tax advisors as to the application of the rules governing “deemed sale” elections to their particular circumstances.

The QEF election is made on a shareholder-by-shareholder basis and, once made, can be revoked only with the consent of the IRS. A U.S. Holder that is eligible to make a QEF election with respect to its REE Class A Ordinary Shares generally may do so by providing the appropriate information to the IRS in the U.S. Holder’s timely filed tax return for the year in which the election becomes effective. Retroactive QEF elections generally may be made only by filing a protective statement with such return and if certain other conditions are met or with the consent of the IRS. U.S. Holders should consult their tax advisors regarding the availability and tax consequences of a retroactive QEF election under their particular circumstances.

U.S. Holders should consult their tax advisors as to the availability and desirability of a QEF election.

Alternatively, if REE is a PFIC and REE Class A Ordinary Shares constitute “marketable stock” (as defined below), a U.S. Holder may make a mark-to-market election for such holder’s REE Class A Ordinary Shares with respect to such shares for the first taxable year in which it holds (or is deemed to hold) REE Class A Ordinary Shares and each subsequent taxable year to elect out of the excess distribution rules discussed above. If a U.S. Holder makes a mark-to-market election with respect to its REE Class A Ordinary Shares, such U.S. Holder generally will include in income for each year that REE is treated as a PFIC with respect to such REE Class A Ordinary Shares an amount equal to the excess, if any, of the fair market value of the REE Class A Ordinary Shares as of the close of the U.S. Holder’s taxable year over the adjusted basis in the REE Class A Ordinary Shares. A U.S. Holder will be allowed a deduction for the excess, if any, of the adjusted basis of the REE Class A Ordinary Shares over their fair market value as of the close of the taxable year. However, deductions will be allowed only to the extent of any net mark-to-market gains on the REE Class A Ordinary Shares included in the U.S. Holder’s income for prior taxable years. Amounts included in income under a mark-to-market election, as well as gain on the actual sale or other disposition of the REE Class A Ordinary Shares, will be treated as ordinary income. Ordinary loss treatment will also apply to the deductible portion of any mark-to-market loss on the REE Class A Ordinary Shares, as well as to any loss realized on the actual sale or disposition of the REE Class A Ordinary Shares, to the extent the amount of such loss does not exceed the net mark-to-market gains for such REE Class A Ordinary Shares previously included in income. A U.S. Holder’s basis in the REE Class A Ordinary Shares will be adjusted to reflect any mark-to-market gain or loss. If a U.S. Holder makes a mark-to-market election, any distributions

REE makes would generally be subject to the rules discussed above under “— Distributions on REE Class A Ordinary Shares,” except the lower rates applicable to qualified dividend income would not apply. Currently, U.S. Holders of REE warrants will not be able to make a mark-to-market election with respect to their REE warrants.

The mark-to-market election is available only for “marketable stock,” which is stock that is regularly traded on a qualified exchange or other market, as defined in applicable U.S. Treasury regulations. The REE Class A Ordinary Shares, which are expected to be listed on Nasdaq, are expected to qualify as marketable stock for purposes of the PFIC rules, but there can be no assurance that REE Class A Ordinary Shares will be “regularly traded” for purposes of these rules. If made, a mark-to-market election would be effective for the taxable year for which the election was made and for all subsequent taxable years unless REE Class A Ordinary Shares cease to qualify as “marketable stock” for purposes of the PFIC rules or the IRS consents to the revocation of the election. Because a mark-to-market election cannot be made for equity interests in any Lower-Tier PFICs, a U.S. Holder that does not make the applicable QEF elections generally will continue to be subject to the excess distribution rules with respect to its indirect interest in any Lower-Tier PFICs as described above, even if a mark-to-market election is made for REE Class A Ordinary Shares.

If a U.S. Holder does not make a mark-to-market election (or a QEF election, as discussed above) effective from the first taxable year of a U.S. Holder’s holding period for the REE Class A Ordinary Shares in which REE is a PFIC, then the U.S. Holder generally will remain subject to the excess distribution rules. A U.S. Holder that first makes a mark-to-market election with respect to the REE Class A Ordinary Shares in a later year will continue to be subject to the excess distribution rules during the taxable year for which the mark-to-market election becomes effective, including with respect to any mark-to-market gain recognized at the end of that year. In subsequent years for which a valid mark-to-mark election remains in effect, the excess distribution rules generally will not apply. A U.S. Holder that is eligible to make a mark-to-market with respect to such holder’s REE Class A Ordinary Shares may do so by providing the appropriate information on IRS Form 8621 and timely filing that form with the U.S. Holder’s tax return for the year in which the election becomes effective.

U.S. Holders should consult their tax advisors as to the availability and desirability of a mark-to-market election, as well as the impact of such election on interests in any Lower-Tier PFICs.

A U.S. Holder of a PFIC may be required to file an IRS Form 8621 on an annual basis and to provide such other information as may be required by the U.S. Treasury Department. Failure to do so, if required, will extend the statute of limitations applicable to such U.S. Holder until such required information is furnished to the IRS. U.S. Holders should consult their tax advisors regarding any reporting requirements that may apply to them if REE is a PFIC.

The rules dealing with PFICs and with the QEF, “deemed sale,” and mark-to-market elections are very complex and are affected by various factors in addition to those described above. U.S. Holders are strongly encouraged to consult their tax advisors regarding the application of the PFIC rules to their particular circumstances. Non-U.S. Holders

The section applies to Non-U.S. Holders of REE Class A Ordinary Shares and REE warrants. For purposes of this discussion, a Non-U.S. Holder means a beneficial owner (other than a partnership or an entity or arrangement so characterized for U.S. federal income tax purposes) of REE Class A Ordinary Shares or REE warrants that is for U.S. federal income tax purposes not a U.S. Holder, including:

•        a nonresident alien individual, other than certain former citizens and residents of the U.S. subject to U.S. tax as expatriates;

•        a foreign corporation; or

•        a foreign estate or trust;

but generally does not include a beneficial owner who has been or is engaged in the conduct of a trade or business within the U.S. or an individual who is present in the U.S. for 183 days or more in the taxable year of the disposition of REE Class A Ordinary Shares or REE warrants (except to the extent discussed below). If you are such an individual, you should consult your tax advisor regarding the U.S. federal income tax consequences of exercising redemption rights with respect to 10X Capital Common Stock or the ownership and disposition of REE Class A Ordinary Shares or REE warrants.

Non-U.S. Holders Exercising Redemption Rights with Respect to 10X Capital Common Stock

The characterization for U.S. federal income tax purposes of the redemption of a Non-U.S. Holder’s 10X Capital Common Stock generally will correspond to the U.S. federal income tax characterization of such a redemption of a U.S. Holder’s 10X Capital Common Stock, as described above under “— U.S. Holders Exercising Redemption Rights with Respect to 10X Capital Common Stock.”

Subject to the discussion below concerning backup withholding, if such a redemption qualifies as a sale of the 10X Capital Common Stock, any redeeming Non-U.S. Holder will generally not be subject to U.S. federal income tax or withholding tax on any gain recognized as a result of the redemption or be able to utilize a loss in computing U.S. federal income tax liability unless one of the exceptions described below under “— U.S. Federal Income Tax Consequences of the Ownership and Disposition of REE Class A Ordinary Shares and REE Warrants to Non-U.S. Holders” applies in respect of gain from the disposition of 10X Capital Common Stock. Moreover, redeeming Non-U.S. Holders may be subject to U.S. federal income tax on any gain recognized as a result of the redemption if 10X Capital Common Stock constitutes a U.S. real property interest by reason of 10X Capital’s status as a U.S. real property holding corporation for U.S. federal income tax purposes. 10X Capital believes that it is not and has not been at any time since its formation a U.S. real property holding corporation.

If a Non-U.S. Holder receives cash for 10X Capital Common Stock, and the redemption is treated as a corporate distribution (rather than a sale of stock under Section 302 of the Code), the Non-U.S. Holder will be subject to a 30% withholding tax (unless otherwise reduced by an applicable income tax treaty and the Non-U.S. Holder provides a proper certificate of its eligibility for such reduced rate (usually on an IRS Form W-8BEN or W-8BEN-E, as applicable)) on the gross amount of the distribution to the extent the distribution is paid from current or accumulated earnings and profits, as determined under U.S. federal income tax principles, and treated as dividends, provided such dividends are not effectively connected with such Non-U.S. Holder’s conduct of a trade or business within the U.S. Any distribution not constituting a dividend will be treated first as reducing (but not below zero) the Non-U.S. Holder’s adjusted tax basis in its 10X Capital Common Stock and then, to the extent such distribution exceeds the Non-U.S. Holder’s adjusted tax basis, as gain realized from the sale or other disposition of such 10X Capital Common Stock, which will be treated as described in the paragraph immediately above. A redemption treated as a dividend by 10X Capital to a Non-U.S. Holder that is effectively connected with such Non-U.S. Holder’s conduct of a trade or business within the United States (and if an income tax treaty applies, are attributable to a U.S. permanent establishment or fixed base maintained by the Non-U.S. Holder in the U.S.) will generally not be subject to U.S. withholding tax, provided such Non-U.S. Holder complies with certain certification and disclosure requirements (usually by providing an IRS Form W-8ECI). Instead, such dividends will generally be subject to U.S. federal income tax, net of certain deductions, at the same corporate or graduated individual rates applicable to U.S. Holders (together with branch profits tax, at a 30% rate, or such lower rate specified by an applicable tax treaty, as adjusted for certain items, if such Non-U.S. Holder is a corporation).

IF YOU ARE A NON-U.S. HOLDER OF 10X CAPITAL COMMON STOCK CONTEMPLATING EXERCISE OF YOUR REDEMPTION RIGHTS, WE URGE YOU TO CONSULT YOUR TAX ADVISOR CONCERNING THE U.S. FEDERAL, STATE, LOCAL, AND FOREIGN INCOME AND OTHER TAX CONSEQUENCES THEREOF.

U.S. Federal Income Tax Consequences of the Ownership and Disposition of REE Class A Ordinary Shares and REE Warrants to Non-U.S. Holders

Subject to the discussion below concerning backup withholding, any (i) dividends of cash or property (including constructive distributions treated as dividends as further described under the heading “U.S. Holders — U.S. Federal Income Tax Consequences of the Ownership and Disposition of REE Class A Ordinary Shares and REE Warrants to U.S. Holders — Possible Constructive Distributions”) paid or deemed paid to a Non-U.S. Holder in respect of REE Class A Ordinary Shares or (ii) gain realized upon the sale or other taxable disposition of REE Class A Ordinary Shares and/or REE warrants by a Non-U.S. Holder generally will not be subject to U.S. federal income taxation or withholding tax unless:

•        the gain or dividend is effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment or a “fixed base” in the United States to which such gain is attributable); or

•        in the case of any gain, the Non-U.S. Holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the disposition and certain other requirements are met.

Gain or distributions described in the first bullet point above generally will be subject to U.S. federal income tax on a net income basis at the regular rates. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such effectively connected gain, as adjusted for certain items.

Gain described in the second bullet point above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty), which may be offset by U.S. source capital losses of the Non-U.S. Holder (even though the individual is not considered a resident of the United States), provided the Non-U.S. Holder has timely filed U.S. federal income tax returns with respect to such losses.

The U.S. federal income tax treatment of a Non-U.S. Holder’s exercise of a REE warrant, or the lapse of a REE warrant held by a Non-U.S. Holder, generally will correspond to the U.S. federal income tax treatment of the exercise or lapse of a REE warrant by a U.S. Holder, as described under “U.S. Holders — U.S. Federal Income Tax Consequences of the Ownership and Disposition of REE Class A Ordinary Shares and REE Warrants to U.S. Holders — Exercise, Lapse or Redemption of a REE Warrant” above, although to the extent a cashless exercise or lapse results in a taxable exchange, the consequences would be similar to those described in the preceding paragraphs above for a Non-U.S. Holder’s gain on the sale or other disposition of the REE Class A Ordinary Shares and REE warrants.

The characterization for U.S. federal income tax purposes of the redemption of the Non-U.S. Holder’s REE warrants generally will correspond to the U.S. federal income tax treatment of such a redemption of a U.S. Holder’s warrants, as described under “U.S. Holders — U.S. Federal Income Tax Consequences of the Ownership and Disposition of REE Class A Ordinary Shares and REE Warrants to U.S. Holders — Exercise, Lapse or Redemption of a REE Warrant” above, and the consequences of the redemption to the Non-U.S. Holder will be as described in the first paragraph above under the heading “— U.S. Federal Income Tax Consequences of the Ownership and Disposition of REE Class A Ordinary Shares and REE Warrants to Non-U.S. Holders” based on such characterization.

Non-U.S. Holders should consult their tax advisors regarding potentially applicable income tax treaties that may provide for different rules.

Information Reporting and Backup Withholding

Information reporting requirements may apply to cash received in redemption of 10X Capital Common Stock, dividends received by U.S. Holders of REE Class A Ordinary Shares, and the proceeds received on the disposition of REE Class A Ordinary Shares effected within the U.S. (and, in certain cases, outside the U.S.), in each case other than U.S. Holders that are exempt recipients (such as corporations). Backup withholding (currently at a rate of 24%) may apply to such amounts if the U.S. Holder fails to provide an accurate taxpayer identification number (generally on an IRS Form W-9 provided to the paying agent of the U.S. Holder’s broker) or is otherwise subject to backup withholding. Any redemptions treated as dividend payments with respect to 10X Capital Common Stock or REE Class A Ordinary Shares and proceeds from the sale, exchange, redemption or other disposition of REE Class A Ordinary Shares may be subject to information reporting to the IRS and possible U.S. backup withholding. U.S. Holders should consult their tax advisors regarding the application of the U.S. information reporting and backup withholding rules.

Information returns may be required to be filed with the IRS in connection with, and Non-U.S. Holders may be subject to backup withholding on amounts received in respect of, a Non-U.S. Holder’s disposition of 10X Capital securities or their REE Class A Ordinary Shares, unless the Non-U.S. Holder furnishes to the applicable withholding agent the required certification as to its non-U.S. status, such as by providing a valid IRS Form W-8BEN, IRS Form W-8BEN-E or IRS Form W-8ECI, as applicable, or the Non-U.S. Holder otherwise establishes an exemption. Dividends paid with respect to REE Class A Ordinary Shares and proceeds from the sale of other disposition of REE Class A Ordinary Shares received in the U.S. by a Non-U.S. Holder through certain U.S.-related financial intermediaries may be subject to information reporting and backup withholding unless such Non-U.S. Holder provides proof of an applicable exemption or complies with certain certification procedures described above, and otherwise complies with the applicable requirements of the backup withholding rules.

Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against the taxpayer’s U.S. federal income tax liability, and a taxpayer may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for a refund with the IRS and furnishing any required information.

THE U.S. FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE TO YOU DEPENDING UPON YOUR PARTICULAR SITUATION. YOU ARE URGED TO CONSULT YOUR OWN TAX ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES TO YOU OF THE MERGER, THE EXERCISE OF YOUR REDEMPTION RIGHTS WITH RESPECT TO 10X CAPITAL COMMON STOCK, AND OF THE OWNERSHIP AND DISPOSITION OF REE CLASS A ORDINARY SHARES AND REE WARRANTS, AS APPLICABLE, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND TAX TREATIES AND THE POSSIBLE EFFECTS OF CHANGES IN U.S. OR OTHER TAX LAWS.

CERTAIN MATERIAL ISRAELI TAX CONSIDERATIONS

The following description is not intended to constitute a complete analysis of all tax consequences relating to the acquisition, ownership and disposition of the REE Class A Ordinary Shares and REE Warrants. You should consult your own tax advisor concerning the tax consequences of your particular situation, as well as any tax consequences that may arise under the laws of any state, local, foreign or other taxing jurisdiction.

Israeli tax considerations

The following is a brief summary of certain material Israeli tax laws applicable to REE, and certain Israeli Government programs that may benefit REE. This section also contains a discussion of certain material Israeli tax consequences concerning the ownership and disposition of REE Class A Ordinary Shares purchased by investors. This summary does not discuss all the aspects of Israeli tax law that may be relevant to a particular investor in light of his or her personal investment circumstances or to some types of investors subject to special treatment under Israeli law. Examples of such investors include residents of Israel or traders in securities who are subject to special tax regimes not covered in this discussion. To the extent that the discussion is based on new tax legislation that has not yet been subject to judicial or administrative interpretation, REE cannot assure you that the appropriate tax authorities or the courts will accept the views expressed in this discussion. The discussion below is not intended and should not be construed, as legal or professional tax advise and is not exhaustive of all possible tax considerations. The discussion is subject to change, including due to amendments under Israeli law or changes to the applicable judicial or administrative interpretations of Israeli law, which change could affect the tax consequences described below.

SHAREHOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS AS TO THE ISRAELI OR OTHER TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF OUR ORDINARY SHARES, INCLUDING, IN PARTICULAR, THE EFFECT OF ANY NON-U.S., STATE OR LOCAL TAXES.

General corporate tax structure in Israel

Israeli companies are generally subject to corporate tax on their taxable income. The corporate tax rate is 23% as of 2018 and thereafter. However, the effective tax rate payable by a company that derives income from a Preferred Enterprise or a Technological Enterprise (as discussed below) may be considerably less. Capital gains derived by an Israeli company are generally subject to corporate tax rate.

Law for the Encouragement of Industry (Taxes), 5729-1969

The Law for the Encouragement of Industry (Taxes), 5729-1969, generally referred to as the Industry Encouragement Law, provides several tax benefits for “Industrial Companies.” We believe that we currently qualify as an Industrial Company within the meaning of the Industry Encouragement Law.

The Industry Encouragement Law defines an “Industrial Company” as an Israeli resident-company, of which 90% or more of its income in any tax year, other than income from certain government loans, is derived from an “Industrial Enterprise” owned by it and located in Israel or in the “Area”, in accordance with the definition under section 3A of the Israeli Income Tax Ordinance (New Version) 5721-1961 (the “Ordinance”). An “Industrial Enterprise” is defined as an enterprise whose principal activity in a given tax year is industrial production.

Following are the main tax benefits available to Industrial Companies:

•        amortization of the cost of purchased patent, rights to use a patent, and know-how, which were purchased in good faith and are used for the development or advancement of the Industrial Enterprise, over 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.

Eligibility for benefits under the Industry Encouragement Law is not contingent upon approval of any governmental authority.

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. No deduction under these research and development deduction rules 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 are deductible in equal amounts over three years.

From time to time we may apply to the Israel Innovation Authority (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, referred to as an Approved Enterprise, a Beneficiary Enterprise, a Preferred Enterprise, a Preferred Technological Enterprise, or a Special Preferred Technological Enterprise, is entitled to benefits as discussed below. These benefits may include cash grants from the Israeli government and tax benefits, based upon, among other things, the geographic location in Israel of the facility in which the investment is made. In order to qualify for these incentives, the Company is required to comply with the requirements of the Investment Law.

The Investment Law was significantly amended effective as of April 1, 2005 (the “2005 Amendment”), as of January 1, 2011 (the “2011 Amendment”) and as of January 1, 2017 (the “2017 Amendment”). Pursuant to the 2005 Amendment, tax benefits granted in accordance with the provisions of the Investment Law prior to its revision by the 2005 Amendment remain in force but any benefits granted subsequently are subject to the provisions of the amended Investment Law. Similarly, the 2011 Amendment introduced new benefits to replace those granted in accordance with the provisions of the Investment Law in effect prior to the 2011 Amendment. However, companies entitled to benefits under the Investment Law as in effect prior to January 1, 2011 were entitled to choose to continue to enjoy such benefits, provided that certain conditions are met, or elect instead, irrevocably, to forego such benefits and have the benefits of the 2011 Amendment apply. The 2017 Amendment introduces new benefits for Technological Enterprises, alongside the existing tax benefits.

Tax benefits under the 2011 amendment

The 2011 Amendment canceled the availability of the benefits granted to Industrial Companies under the Investment Law prior to 2011 and, instead, introduced new benefits for income generated by a “Preferred Company” through its “Preferred Enterprise” (as such terms are defined in the Investment Law) as of January 1, 2011. The definition of a Preferred Company includes a company incorporated in Israel that is not fully owned by a governmental entity, and that has, among other things, Preferred Enterprise status and is controlled and managed from Israel. Pursuant to the 2011 Amendment, a Preferred Company is entitled to a reduced corporate tax rate of 15% with respect to its income derived by its Preferred Enterprise in 2011 and 2012, unless the Preferred Enterprise is located in a specified development zone, in which case the rate will be 10%. Under the 2011 Amendment, such corporate tax rate was reduced from 15% and 10%, respectively, to 12.5% and 7%, respectively, in 2013, 16% and 9% respectively, in 2014, 2015 and 2016, and 16% and 7.5%, respectively, in 2017 and thereafter. Income derived by a Preferred Company from

a “Special Preferred Enterprise” (as such term is defined in the Investment Law) would be entitled, subject to certain conditions and during a benefits period of 10 years, to further reduced tax rates of 8%, or 5% if the Special Preferred Enterprise is located in a certain development zone.

Dividends distributed from income which is attributed to a “Preferred Enterprise” will be subject to withholding tax at source at the following rates: (i) Israeli resident corporations — 0%, (although, if such dividends are subsequently distributed to individuals or a non-Israeli company the below rates detailed in sub sections (ii) and (iii) shall apply) (ii) Israeli resident individuals — 20% (iii) non-Israeli residents (individuals and corporations) — 20%, subject to the receipt in advance of a valid certificate from the Israel Tax Authority (“ITA”) allowing for a reduced tax rate.

REE currently does not intend to implement the 2011 Amendment.

New tax benefits under the 2017 Amendment that became effective on January 1, 2017

The 2017 Amendment provides new tax benefits for two types of “Technological Enterprises,” as described below, and is in addition to the other existing tax beneficial programs under the Investment Law.

The 2017 Amendment provides that a Preferred Company satisfying certain conditions will qualify as a “Preferred Technological Enterprise” and will thereby enjoy a reduced corporate tax rate of 12% on income that qualifies as “Preferred Technological Income”, as defined in the Investment Law. The tax rate is further reduced to 7.5% for a Preferred Technological Enterprise located in development zone “A”. In addition, a Preferred Technological Enterprise will enjoy a reduced corporate tax rate of 12% on capital gain derived from the sale of certain “Benefitted Intangible Assets” (as defined in the Investment Law) to a related foreign company if the Benefitted Intangible Assets were acquired from a foreign company on or after January 1, 2017 for at least NIS 200 million, and the sale receives prior approval from the IIA.

The 2017 Amendment further provides that a Preferred Company satisfying certain conditions (group consolidated revenues of at least NIS 10 billion) will qualify as a “Special Preferred Technological Enterprise” and will thereby enjoy a reduced corporate tax rate of 6% on “Preferred Technological Income” regardless of the company’s geographic location within Israel. It should be noted that the proportion of income that may be considered Preferred Technological Income and enjoy the tax benefits described above, should be calculated according to the Nexus Formula, which is based on the proportion as that of qualifying expenditures in the IP compared to overall expenditures. In addition, a Special Preferred Technological Enterprise will enjoy a reduced corporate tax rate of 6% on capital gain derived from the sale of certain “Benefitted Intangible Assets” to a related foreign company if the Benefitted Intangible Assets were either developed by the Special Preferred Enterprise or acquired from a foreign company on or after January 1, 2017, and the sale received prior approval from the IIA. A Special Preferred Technological Enterprise that acquires Benefitted Intangible Assets from a foreign company for more than NIS 500 million will be eligible for these benefits for at least ten years, subject to certain approvals as specified in the Investment Law.

Dividends distributed by a Preferred Technological Enterprise or a Special Preferred Technological Enterprise, paid out of Preferred Technological Income, are generally subject to tax at the rate of 20% or such lower rate as may be provided in an applicable tax treaty (subject to the receipt in advance of a valid certificate from the ITA allowing for a reduced tax rate). However, if such dividends are paid to an Israeli company, no tax is required to be withheld. If such dividends are distributed to a foreign company that holds solely or together with other foreign companies 90% or more in the Israeli company and other conditions are met, the tax rate will be 4%. However, the withholding tax rate applicable to distribution of dividend from Preferred Technological Income to non-Israeli residents is generally 25%, which may be reduced by applying in advance for a withholding certificate from the ITA. The above reduced withholding tax rates may require filing an application in advance for a withholding certificate from the ITA REE believes that it may be eligible for the tax benefits under the 2017 Amendment.

Taxation of our shareholders

Capital gains Tax on Sales of our Ordinary Shares

Israeli law generally imposes a capital gains tax on the sale of any capital assets by Israeli residents, as defined for Israeli tax purposes, and on the sale of capital assets located in Israel, including shares in Israeli companies, by both Israeli residents and non-Israeli residents, unless a specific exemption is available or unless a tax treaty between Israel and the shareholder’s

country of residence provides otherwise. The Ordinance distinguishes between real gain and inflationary surplus. The inflationary surplus is a portion of the total capital gain equivalent to the increase of the relevant asset’s purchase price attributable to an increase in the Israeli consumer price index, or a foreign currency exchange rate, between the date of purchase and the date of sale. Inflationary surplus is currently not subject to tax in Israel. The real gain is the excess of the total capital gain over the inflationary surplus.

Capital gains taxes applicable to Israeli resident shareholders

An Israeli resident corporation that derives capital gains from the sale of shares in an Israeli resident company will generally be subject to tax on the real capital gains generated on such sale at the corporate tax rate of 23% (in 2021). An Israeli resident individual will generally be subject to capital gain tax at the rate of 25%. However, if the individual shareholder claims deduction of interest and linkage differences expenses in connection with the purchase and holding of such shares or is a “substantial shareholder” at the time of the sale or at any time during the preceding twelve months period, such gain will be taxed at the rate of 30%. A “substantial shareholder” is generally a person who alone or together with such person’s relative or another person who collaborates with such person on a permanent basis, holds, directly or indirectly, at least 10% of any of the “means of control” of the corporation. “Means of control” generally include the right to vote, receive profits, nominate a director or an executive officer, receive assets upon liquidation, or order someone who holds any of the aforesaid rights how to act, regardless of the source of such right. Individual holders dealing in securities in Israel for whom the income from the sale of securities is considered “business income” as defined in Section 2(1) of the Ordinance are taxed at the marginal tax rates applicable to business income (up to 47% in 2021) plus an additional excess tax of 3% as described below. Certain Israeli institutions who are exempt from tax under Section 9(2) or Section 129C(a)(1) of the Ordinance (such as exempt trust fund, pension fund) may be exempt from capital gains tax from the sale of the shares.

Capital gains taxes applicable to non-Israeli resident shareholders

A non-Israeli resident who derives capital gains from the sale of shares in an Israeli resident company that were purchased after the company was listed for trading on a stock exchange outside of Israel, will be exempt from Israeli tax if, among other conditions, the shares were not held through a permanent establishment that the non-resident maintains in Israel. However, non-Israeli corporations will not be entitled to the foregoing exemption if Israeli residents: (i) have a controlling interest of more than 25% in such non-Israeli corporation or (ii) are the beneficiaries of, or are entitled to, 25% or more of the revenues or profits of such non-Israeli corporation, whether directly or indirectly. In addition, such exemption is not applicable to a person whose gains from selling or otherwise disposing of the shares are deemed to be business income.

Additionally, a sale of securities by a non-Israeli resident may be exempt from Israeli capital gains tax under the provisions of an applicable tax treaty. For example, under the Convention Between the Government of the United States of America and the Government of the State of Israel with respect to Taxes on Income, as amended (the “United States Israel Tax Treaty”), the sale, exchange or other disposition of shares by a shareholder who is a United States resident (for purposes of the treaty) holding the shares as a capital asset and is entitled to claim the benefits afforded to such a resident by the U.S. Israel Tax Treaty (a “U.S. Resident”) is generally exempt from Israeli capital gains tax unless: (i) the capital gain arising from such sale, exchange or disposition is attributed to real estate located in Israel; (ii) the capital gain arising from such sale, exchange or disposition is attributed to royalties; (iii) the capital gain arising from the such sale, exchange or disposition is attributed to a permanent establishment in Israel, under certain terms; (iv) such U.S. Resident holds, directly or indirectly, shares representing 10% or more of the voting capital during any part of the 12 month period preceding the disposition, subject to certain conditions; or (v) such U.S. Resident is an individual and was present in Israel for 183 days or more during the relevant taxable year. If any such case occurs, the sale, exchange or disposition of our ordinary shares by the U.S. Resident would be subject to Israeli tax, unless exempt under Israeli domestic law as described above. However, under the United States Israel Tax Treaty, such U.S. Resident should be permitted to claim a credit for such taxes against U.S. federal income tax imposed on any gain from such sale, exchange or disposition, under the circumstances and subject to the limitations specified in the United States Israel Tax Treaty or in the United States federal income tax laws applicable to foreign credits.

In some instances where our shareholders may be liable for Israeli tax on the sale of their ordinary shares, the payment of the consideration may be subject to the withholding of Israeli tax at source. Shareholders may be required to demonstrate that they are exempt from tax on their capital gains in order to avoid withholding at source at the time of sale. Specifically, in transactions involving a sale of all of the shares of an Israeli resident company, in the form of a

merger or otherwise, the ITA may require shareholders who are not liable for Israeli tax to sign declarations in forms specified by the ITA or obtain a specific exemption from the ITA to confirm their status as non-Israeli resident, and, in the absence of such declarations or exemptions, may require the purchaser of the shares to withhold taxes at source.

A detailed return, including a computation of the tax due, must be filed and an advance payment must be paid on January 31 and July 31 of each tax year for sales of securities traded on a stock exchange made within the previous six months. However, if all tax due was withheld at the source according to applicable provisions of the Ordinance and the regulations promulgated thereunder, the return does not need to be filed provided that (i) such income was not generated from business conducted in Israel by the taxpayer, (ii) the taxpayer has no other taxable sources of income in Israel with respect to which a tax return is required to be filed and an advance payment does not need to be made, and (iii) the taxpayer is not obligated to pay excess tax (as further explained below). Capital gains are also reportable on an annual income tax return.

Taxation of Israeli shareholders on receipt of dividends

An Israeli resident individual is generally subject to Israeli income tax on the receipt of dividends paid on our ordinary shares at the rate of 25%. With respect to a person who is a “substantial shareholder” at the time of receiving the dividend or on any time during the preceding twelve months, the applicable tax rate is 30%. Such dividends are generally subject to Israeli withholding tax at a rate of 25% if the shares are registered with a nominee company (whether the recipient is a substantial shareholder or not) and 20% if the dividend is distributed from income attributed to a Preferred Enterprise or Technological Enterprise. If the recipient of the dividend is an Israeli resident corporation such dividend income will be exempt from tax provided the income from which such dividend is distributed was derived or accrued within Israel and was received directly or indirectly from another corporation that is liable to Israeli corporate tax. An exempt trust fund, pension fund or other entity that is exempt from tax under Section 9(2) or Section 129(C)(a)(1) of the Ordinance is exempt from tax on dividend.

Taxation of non-Israeli shareholders on receipt of dividends

Non-Israeli residents (either individuals or corporations) are generally subject to Israeli income tax on the receipt of dividends paid on our ordinary shares at the rate of 25% or 30% if the dividends recipient is a “substantial shareholder” at the time of distribution or at any time during the preceding 12 months period, which tax will be withheld at source, unless relief is provided in a treaty between Israel and the shareholder’s country of residence. Such dividends are generally subject to Israeli withholding tax at a rate of 25% if the shares are registered with a nominee company (whether the recipient is a substantial shareholder or not). Such withholding rates may be reduced if the dividend is distributed from income attributed to a Preferred Enterprise or Technological Enterprise or a reduced rate provided under an applicable tax treaty, in each case subject to the receipt in advance of a valid certificate from the ITA allowing for a reduced tax rate. For example, under the United States-Israel Tax Treaty, the maximum rate of tax withheld at source in Israel on dividends paid to a holder of our ordinary shares who is a U.S. Resident is 25%. However, generally, the maximum rate of withholding tax on dividends, not generated by a Preferred Enterprise or Technological Enterprise, that are paid to a United States corporation holding 10% or more of the outstanding voting capital throughout the tax year in which the dividend is distributed as well as during the previous tax year, is 12.5%, provided that not more than 25% of the gross income for such preceding year consists of certain types of dividends and interest. Notwithstanding the foregoing, dividends distributed from income attributed to an Approved Enterprise, Benefited Enterprise or Preferred Enterprise are not entitled to such reduction under the tax treaty but are subject to a withholding tax rate of 15% for a shareholder that is a U.S. corporation, provided that the conditions related to the outstanding voting rights and the gross income for the previous year (as set forth in the previous sentences) are met. If the dividend is attributable partly to income derived from a Preferred Enterprise or Technological Enterprise, and partly to other sources of income, the withholding rate will be a blended rate reflecting the relative portions of the two types of income. We cannot assure you that we will designate the profits that we may distribute in a way that will reduce shareholders’ tax liability.

A foreign resident who had income from a dividend that was accrued from Israeli source, from which the full tax was deducted, will be generally exempt from filing a tax return in Israel, provided that (1) such income was not generated from business conducted in Israel by the foreign resident, (ii) the foreign resident has no other taxable sources of income in Israel with respect to which a tax return is required to be filed and (iii) the foreign resident is not liable to additional Surtax (see below) in accordance with Section 121B of the Ordinance.

Surtax

Subject to the provisions of an applicable tax treaty, individuals who are subject to tax in Israel (whether any such individual is an Israeli resident or non-Israeli resident) are also subject to an additional tax at a rate of 3% on annual income (including, but not limited to, dividends, interest and capital gain) exceeding NIS 647,640 for 2021, which amount is linked to the annual change in the Israeli consumer price index.

Estate and Gift Tax

Israeli law presently does not impose estate or gift taxes.

INFORMATION ABOUT THE COMPANIES

10X Capital

References in this section to “10X Capital,” “we,” “our” or “us” refer to 10X Capital Venture Acquisition Corp, a Delaware corporation.

10X Capital was incorporated on August 10, 2020 as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. 10X Capital’s efforts to identify a prospective target business were not limited to any particular industry or geographic region although it focused its search for target businesses that operated in the technology sector. Prior to executing the Merger Agreement with REE, 10X Capital’s efforts were limited to organizational activities, completion of its initial public offering and the evaluation of possible business combinations.

In August 2020, 10X Capital issued an aggregate of 6,325,000 shares of its Class B Common Stock to the Sponsor, for $25,000 in cash, at a purchase price of approximately $0.005 per share, in connection with its organization. In November 2020, the Sponsor forfeited 1,293,750 Sponsor Shares back to 10X Capital for no consideration. The Sponsor Shares included an aggregate of up to 656,250 shares which were subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment option was not exercised in full. As a result of the underwriters’ election to exercise their over-allotment option in full on December 18, 2020, 656,250 Sponsor Shares were no longer subject to forfeiture.

10X Capital’s Units, the 10X Capital Class A Common Stock and the 10X Capital Warrants are listed on the Nasdaq Capital Market under the symbols VCVCU, VCVC and VCVCW, respectively.

The mailing address of 10X Capital’s principal executive office is 1 World Trade Center, 85th Floor, New York, NY 10007, and its telephone number is (212) 257-0069. After the consummation of the Merger, 10X Capital’s principal executive office will be that of REE.

REE

REE is a development stage technology company in the field of electric mobility that aims to reinvent the EV and next-generation e-mobility market. REE’s mission is to empower global mobility companies to build any size or shape of electric or autonomous vehicle — from Class 1 through Class 6 — for various applications and target markets. REE strives to be the cornerstone on top of which mobility players can build their dreams of future services, unbound by legacy thinking, as REE carries the next generation of electric and autonomous vehicles on a truly modular and scalable platform.

The mailing address for REE’s principal executive office is 10 Aharon Maskin Street, Tel-Aviv, Israel and its telephone number is +972 0778995193.

Merger Sub

Spark Merger Sub Inc. is a newly formed Delaware corporation and a direct, wholly-owned subsidiary of REE. Merger Sub was formed solely for the purpose of effecting the proposed Merger with 10X Capital and has not carried on any activities other than in connection with the proposed Merger. The address and telephone number for Merger Sub’s principal executive offices are the same as those for REE.

10X CAPITAL BUSINESS

References in this section to “10X Capital,” “we,” “our” or “us” refer to 10X Capital Venture Acquisition Corp., a Delaware corporation.

Introduction

10X Capital was incorporated on August 10, 2020 whose purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or entities. 10X Capital’s efforts to identify a prospective target business were not limited to any particular industry or geographic region, although it initially focused its search for target businesses on companies operating in the federally permissible cannabinoid industry. Prior to executing the Merger Agreement, 10X Capital’s efforts were limited to organizational activities, completion of its initial public offering and the evaluation of possible business combinations.

Initial Public Offering and Simultaneous Private Placement

On November 27, 2020, 10X Capital closed its IPO of 17,500,000 Units, with each Unit consisting of one share of its 10X Capital Class A Common Stock and one-half of one Public Warrant. Each whole Public Warrant entitles the holder to purchase one share of 10X Capital Class A Common Stock at a purchase price of $11.50 upon consummation of an initial business combination. The Units from the initial public offering (including the over-allotment option) were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $175,000,000.

Simultaneously with the consummation of the initial public offering, 10X Capital consummated a private placement of 5,500,000 Private Warrants to the Sponsor. The Private Warrants were sold at an offering price of $1.00 per whole warrant, generating gross proceeds of $5,500,000. The Private Warrants are identical to the Public Warrants sold in the IPO, except that the Private Warrants are not redeemable and are exercisable on a cashless basis as long as held by the Sponsor or its permitted transferees. The Sponsor has agreed that these Private Warrants will not be sold or transferred by it (except to certain permitted transferees) until after 10X Capital has completed an initial business combination.

On December 18, 2020, the underwriters exercised in full their over-allotment option of 2,625,000 Units, generating gross proceeds of $26,250,000. 10X Capital funded the Trust Account with $201,250,000 of the cash proceeds from the IPO (including the exercise of the over-allotment option), and the net proceeds from the Private Warrants after the payment of expenses associated with the IPO.

Offering Proceeds Held in Trust

The net proceeds from the IPO (including the exercise of the over-allotment option), plus the net proceeds from the Private Warrants, or an aggregate of $201,250,000 (including $7,568,750 of deferred underwriter fees payable to the underwriter of the IPO upon completion of an initial business combination), was placed in the Trust Account at JP Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds held in the Trust Account that may be released to 10X Capital to pay its tax obligations, the proceeds from the Initial Public Offering and concurrent Private Placement will not be released from the Trust Account until the earliest to occur of (a) the completion of an initial business combination, (b) the redemption of any Public Shares properly submitted in connection with a stockholder vote to amend 10X Capital’s amended and restated certificate of incorporation (i) to modify the substance or timing of 10X Capital’s obligation to redeem 100% of the Public Shares if 10X Capital does not complete an initial business combination by May 27, 2022, or (ii) with respect to any other provision relating to stockholders’ rights or pre-business combination activity, and (c) the redemption of the Public Shares if 10X Capital is unable to complete an initial business combination by May 27, 2022, subject to applicable law.

Fair Market Value of Target Business

The target business or businesses that 10X Capital acquires must collectively have a fair market value equal to at least 80% of the balance of the funds in the Trust Account at the time of the execution of a definitive agreement for its initial business combination (excluding the deferred underwriting discount held in, and taxes payable on the income earned on, the Trust Account), although 10X Capital may acquire a target business whose fair market value significantly exceeds 80% of the Trust Account balance. The 10X Capital board of directors have determined that this test was met in connection with the proposed Merger with REE.

Stockholder Approval of Mergers

Under 10X Capital’s amended and restated certificate of incorporation, in connection with any proposed Merger, 10X Capital must seek stockholder approval of an initial business combination at a meeting called for such purpose at which Public Stockholders may request to have their Public Shares redeemed, regardless of whether they vote for or against the proposed Merger, subject to the limitations described in the prospectus for 10X Capital’s initial public offering. Accordingly, in connection with the Merger with REE, 10X Capital Public Stockholders may request to have their Public Shares redeemed in accordance with the procedures set forth in this proxy statement/prospectus.

Voting Restrictions in Connection with Stockholder Meeting

In connection with any vote for a proposed Merger, including the vote with respect to the Merger Proposal, the Sponsor has agreed to vote all of its shares of 10X Capital Common Stock acquired in favor of such proposed Merger.

No directors or officers of 10X Capital have purchased any securities of 10X Capital in any open market transactions. However, at any time prior to the Special Meeting, during a period when they are not then aware of any material nonpublic information regarding 10X Capital or its securities, the Sponsor, as an initial stockholder of 10X Capital, 10X Capital’s officers and directors, REE, the REE officers and directors and/or their respective affiliates, or REE shareholders may purchase Public Shares from institutional and other investors who vote, or indicate an intention to vote, against the Merger Proposal, or execute agreements to purchase such shares from them in the future, or they may enter into transactions with such persons and others to provide them with incentives to acquire shares of 10X Capital Common Stock or vote their shares in favor of the Merger Proposal. The purpose of such share purchases and other transactions would be to increase the likelihood of satisfaction of the requirements that the Merger be approved where it appears that such requirements would otherwise not be met. All shares repurchased by 10X Capital’s affiliates pursuant to such arrangements would be voted in favor of the proposed Merger. As of the date of this proxy statement/prospectus, there have been no such discussions and no agreements to such effect have been entered into with any such investor or holder.

Liquidation if No Merger

Under 10X Capital’s Existing Charter, if 10X Capital does not complete the Merger with REE or another initial business combination by May 27, 2022, 10X Capital will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding Public Shares for a pro rata portion of the funds held in the Trust Account (approximately $10.00 per share as of November 24, 2020 without considering additional funds to be deposited in connection with potential extensions) and (iii) as promptly as reasonably possible following such redemption, subject to the approval of 10X Capital’s remaining stockholders and its board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to 10X Capital’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. At such time, the Warrants will expire. Holders of Warrants will receive nothing upon a liquidation with respect to such rights and the Warrants will be worthless.

10X Capital’s initial stockholder, the Sponsor, has agreed to waive its rights to participate in any distribution from 10X Capital’s Trust Account or other assets with respect to the initial shares and shares underlying the private Units. There will be no distribution from the Trust Account with respect to 10X Capital’s Warrants, which will expire worthless if 10X Capital is liquidated.

The proceeds deposited in the Trust Account could, however, become subject to the claims of 10X Capital’s creditors which would be prior to the claims of 10X Capital Public Stockholders. Although 10X Capital has obtained waiver agreements from certain vendors and service providers it has engaged and owes money to, and the prospective target businesses 10X Capital has negotiated with, whereby such parties have waived any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account, and although 10X Capital will seek such waivers from vendors it engages in the future, there is no guarantee that they or other vendors who did not execute such waivers will not seek recourse against the Trust Account notwithstanding such agreements. The Sponsor has agreed that it will be liable to 10X Capital if and to the extent any claims by a third party (other than 10X Capital’s independent auditors) for services rendered or products sold to 10X Capital, or a prospective target business with which 10X Capital discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (i) $10.00 per Public Share or (ii) such

lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account, due to reductions in value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under 10X Capital’s indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver is deemed to be unenforceable against a third party, then the Sponsor will not be responsible to the extent of any liability for such third party claims. 10X Capital has not independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations and believes that the Sponsor’s only assets are securities of 10X Capital. 10X Capital has not asked the Sponsor to reserve for such indemnification obligations. Therefore, 10X Capital can give no assurance that the Sponsor would be able to satisfy those obligations. As a result, if any such claims were successfully made against the Trust Account, the funds available for redemptions could be reduced to less than $10.00 per Public Share. In such event, holders of Public Shares would receive such lesser amount per share in connection with any redemption. None of 10X Capital’s officers or directors will indemnify 10X Capital for claims by third parties including, without limitation, claims by vendors and prospective target businesses. Additionally, if 10X Capital is forced to file a bankruptcy case or an involuntary bankruptcy case is filed against it which is not dismissed, the proceeds held in the Trust Account could be subject to applicable bankruptcy law, and may be included in 10X Capital’s bankruptcy estate and subject to the claims of third parties with priority over the claims of 10X Capital’s stockholders. To the extent any bankruptcy claims deplete the Trust Account, 10X Capital cannot assure you it will be able to return to Public Stockholders at least $10.00 per share. Public Stockholders are entitled to receive funds from the Trust Account only in the event of its failure to complete an initial business combination within the required time periods or if the stockholders properly seek to have 10X Capital redeem their respective shares for cash upon an initial business combination which is actually completed by 10X Capital. In no other circumstances does a stockholder have any right or interest of any kind to or in the Trust Account.

Under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The portion of 10X Capital’s Trust Account distributed to 10X Capital Public Stockholders upon the redemption of 100% of its outstanding Public Shares in the event 10X Capital does not complete its initial business combination within the required time period may be considered a liquidation distribution under Delaware law. If the corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution.

Furthermore, if the portion of the Trust Account distributed to Public Stockholders upon the redemption of 100% of its Public Shares in the event 10X Capital does not complete its initial business combination within the required time period is not considered a liquidation distribution under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidation distribution. If 10X Capital is unable to complete an initial business combination within the prescribed time frame, it will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding Public Shares, which redemption will completely extinguish Public Stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of 10X Capital’s remaining stockholders and its board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to its obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Accordingly, if an initial business combination does not occur, it is 10X Capital’s intention to redeem its Public Shares as soon as reasonably possible following the expiration of the time periods described above and, therefore, 10X Capital does not intend to comply with the procedures required by Section 280 of the DGCL, which would limit the amount and duration of 10X Capital’s stockholders’ liability with respect to liquidating distributions as described above. As such, 10X Capital’s stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of 10X Capital’s stockholders may extend well beyond the third anniversary of such date.

Because 10X Capital will not be complying with Section 280 of the DGCL, Section 281(b) of the DGCL requires 10X Capital to adopt a plan, based on facts known to it at such time that will provide for its payment of all existing and pending claims or claims that may be potentially brought against it within the subsequent 10 years. However, because 10X Capital is a blank check company, rather than an operating company, and 10X Capital’s operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from its vendors (such as lawyers, investment bankers, etc.) or prospective target businesses.

10X Capital will pay the costs of any subsequent liquidation from its remaining assets outside of the Trust Account. If such funds are insufficient, each of the executives of 10X Capital has agreed to pay the funds necessary to complete such liquidation (currently anticipated to be no more than approximately $15,000) and has agreed not to seek repayment for such expenses.

Facilities

10X Capital currently maintains its principal executive offices at 1 World Trade Center, 85th Floor, New York, NY 10007. 10X Capital considers its current office space, combined with the other office space otherwise available to its executive officers, adequate for its current operations.

Employees

10X Capital has four executive officers, and no additional employees. These individuals are not obligated to devote any specific number of hours to 10X Capital’s matters and intend to devote only as much time as necessary to assist 10X Capital identify, negotiate and complete an initial business combination and perform fiduciary duties to 10X Capital’s stockholders and other obligations of such officers pursuant to applicable legal requirements and 10X Capital’s certificate of incorporation and bylaws. 10X Capital does not intend to have any full time employees prior to the consummation of an initial business combination. 10X Capital will continue to exist as a wholly-owned subsidiary of REE for potential business and financing purposes.

Directors and Executive Officers

10X Capital’s directors and officers are as follows:

Hans Thomas, 43, has served as our Chief Executive Officer since August 2020. Mr. Thomas founded 10X Capital in January 2004, and since its founding, he has served as chief executive officer of 10X Capital. Since July 2019, he has served chairman of 10X Capital subsidiary Growth Technology Partners. Mr. Thomas also served as executive director of One Zero Capital, a New York City-based financial technology (“FinTech”) investor, from August 2001 until December 2019. As an entrepreneur, Mr. Thomas was on the founding teams of venture-backed FinTech startup InternetCash (1999), online mortgage firm RefinanceOne (2004) and data science firm TheNumber (2015). Mr. Thomas is regarded as a top technology sector investor, financier and visionary because of his track record of identifying and investing in promising early stage opportunities and connecting them with institutional capital to help accelerate their growth. Notable portfolio companies and personal investments include Robinhood, AlphaFlow, Inc., Milo Credit, Better and Climb, whose equity investors include Sequoia, Kleiner Perkins, Point72 Ventures, Social Capital, and QED Investors, and whom have obtained significant financing from leading institutional investors and investment banks, such as The Blackstone Group, Inc. (NYSE: BX), The Goldman Sachs Group, Inc. (NYSE: GS) and Jefferies Group LLC. Mr. Thomas, through 10X Capital’s subsidiary, Growth Technology Partners, was also involved as an early investor in DraftKings Inc. (Nasdaq: DKNG), which completed a merger with Diamond Eagle Acquisition

Corp., a SPAC, in April 2020. Mr. Thomas attended New York University. We believe Mr. Thomas is qualified to serve on our board of directors because of his experience in providing financing solutions for businesses, including with respect to Mergers and SPACs.

David Weisburd, 35, has been our Chief Operating Officer and a Director since August 2020. Mr. Weisburd founded the venture capital firm Growth Technology Partners in May 2015 and served as general partner until December 2019, when the firm was acquired by 10X Capital. The portfolio companies of Growth Technology Partners include 23andMe, CaaStle, Circle, Palantir, Pipefy, Punchh, Ripple, Tonal, Vicarious and Wish. Mr. Weisburd now serves as General Partner and co-head of venture capital at 10X Capital, where he has led the firm’s investments into Robinhood, Compass Therapeutics, HeadSpace and DraftKings Inc. (Nasdaq: DKNG). Mr. Weisburd also serves as a partner of Flight VC, an investment syndicate with over 2700 members across Silicon Valley and other tech hubs including Boston, Los Angeles, and New York, and whose members range from angel investors to entrepreneurs and venture capitalists. Flight VC has a prolific track record investing in companies including Betterment, Carta, Cruise Automotive, Discord, Dollar Shave Club, Fastly, Inc. (NYSE: FSLY), LinkedIn, Paypal, Inc. (Nasdaq: PYPL), Rent the Runway, and many others. In addition to his direct investment activity, Mr. Weisburd has also conducted a substantial amount of secondary market investment into companies such as Lyft, Inc. (Nasdaq: LYFT), One Medical Group (Nasdaq: ONEM), Space X, and Spotify (NYSE: SPOT). Prior to his venture capital career, Mr. Weisburd was on the founding teams of two venture-backed technology startups, isocket (acquired by Magnite (Nasdaq: MGNI)) and RoomHunt (acquired by RentLingo). Mr. Weisburd received a BS in management and entrepreneurship from Indiana University — Kelley School of Business, an MBA from Dartmouth — Tuck School of Business, and is currently pursuing a Masters degree in psychology from Harvard University. We believe Mr. Weisburd is qualified to serve on our board of directors because of his track record of founding and investing in technology companies and his network of venture-backed Sponsors, companies and venture capitalist co-investors throughout Silicon Valley.

Guhan Kandasamy, 39, has been our Chief Financial Officer since August 2020. Since April 2018, Mr. Kandasamy has served as the chief credit and data officer and a member of the board of directors of 10X Capital Partners, LLC, where he also served as a member of the investment committee and oversaw the firm’s credit policy. In 2015, Mr. Kandasamy co-founded TheNumber, a One Zero Capital company, which provides credit market analytics and intelligence to leading credit hedge funds, Bulge Bracket Banks and Retail Banks. At TheNumber, he first served as the founding product manager, and as chief executive officer from January 2016 to March 2018. From October 2010 to January 2015, Mr. Kandasamy served as global head of product and data analytics at Opera Solutions, LLC (now ElectrifAi), where he co-founded the company’s financial services vertical while helping the Sponsors raise its first private capital from Silver Lake Partners, KKR & Co. Inc. and Wipro Limited (NYSE: WIT). Mr. Kandasamy has also previously served as Vice President of US Structured Finance for the global credit ratings agency DBRS, Inc. and as analyst for the private secondary market firm SecondMarket, Inc., which was later acquired by Nasdaq. Prior to that, as its first product employee, he served as the founding product manager at CoreLogic, Inc. (NYSE: CLGX) from January 2004 to June 2007, and there he led development of CoreLogic’s product suite including Loansafe, the credit risk product used by a large portion of the mortgage market, as well as CoreLogic’s initial Automated Value Models (“AVMs”) and AVM cascade models for real estate assets, which remain the industry standard. During his tenure, he provided key evaluation and assistance to CoreLogic through several major corporate acquisitions, including First American Corporation. The company now produces over $1.7B in annual revenue and has an enterprise value of $5.3B. Mr. Kandasamy began his career in 2003 at the Federal National Mortgage Association (“Fannie Mae”) as a credit risk policy analyst, where he developed the agency’s still-operational and patented Consumer Credit Risk Assessment Model (FMCA), along with several capital allocation, collateral risk and property valuation models. Mr. Kandasamy received an MBA with a concentration in Finance from Oxford University in 2010 and a received a double BA from Johns Hopkins University in 2003.

Oliver Wriedt, 49, has served as our President and Head of Capital Markets since August 2020. Mr. Wriedt has twenty-seven years of experience in lending, structuring, portfolio management and business development. He has been an investor in early stage FinTech companies since 2014. Mr. Wriedt most recently served as chief executive officer of DFG Investment Advisers (“DFG”) from April 2019 to July 2020. DFG is a structured credit asset manager focused on collateralized loan obligations (“CLOs”) and leveraged loans, with $8 billion of assets under management (“AUM”). Prior to DFG, Mr. Wriedt spent six years at CIFC Asset Management from March 2012 to May 2018, where he most recently served as co-chief executive officer. During his tenure at CIFC, Mr. Wriedt took the company private in a $333 million strategic sale. CIFC’s AUM have grown to $26 billion. Mr. Wriedt was responsible for business development at the credit arm of Providence Equity Partners from 2010 to 2012. Later renamed Benefit Street, the asset manager grew to $26 billion and was acquired by Franklin Templeton (NYSE: BEN). Mr. Wriedt

was previously a partner at Sciens Capital Management from 2008-2009 and was a partner at Golden Tree Asset Management from 2004 to 2008. Mr. Wriedt was originally trained as a banker at Deutsche Bank (NYSE: DB) and NORD/LB in Hannover, Singapore, London and New York. Since February 2020, Mr. Wriedt has served on the board of directors of Cadence Group, Inc., a New York-based digital securitization and investment platform for private credit. He is a seed investor in FinTech lenders Milo Credit and Pollen VC and payment platforms EMQ and QRails. In addition, he serves on the Board of Directors of The River Fund, a non-profit organization dedicated to eradicating hunger, homelessness and poverty in New York City. Mr. Wriedt graduated from Duke University in 1993 with an AB in History and Economics.

Chris Jurasek, 55, has served on our board of directors since November 2020. Mr. Jurasek has been an operating executive for Clearlake Capital Group, L.P. (“Clearlake”) since 2014. Clearlake is a Los Angeles-based private equity investor with $24 billion of AUM. Clearlake’s core target sectors include software and technology-enabled services, industrials and consumer. Since June 2020, Mr. Jurasek has also served as the chief executive officer of EagleView, a leading technology provider of aerial imagery, data analytics and GIS solutions with more than 200 patents, backed by Clearlake and Vista Equity Partners. Prior to EagleView, Mr. Jurasek served as president of JetSmarter, a private aviation software company acquired by Vista Global, from August 2018 to December 2019. Between February 2013 and January 2020, Mr. Jurasek also held the roles of president, chief executive officer and vice chairman of Calero Software, LLC, which merged with technology expense management software firm MDSL in a 2019 deal backed by Oak Hill Capital and Riverside Partners. From August 2017 to January 2019, he served as a member of the board of directors of ConvergeOne Holdings, Inc., a leading IT services provider of collaboration and technology solutions for large and medium enterprises, which went public through a merger with a SPAC, Forum Merger Corp., in February 2018 at an enterprise value of $1.2 billion, and was subsequently acquired by CVC for $1.8 billion ($12.50 per common share). Chris earned his MBA from the Kellogg School of Management at Northwestern University and holds a bachelor’s degree from Bowling Green State University. We believe Mr. Jurasek is qualified to serve on our board of directors because of his decades of experience leading global software and industrial technology companies and a track record of driving innovation to generate long-term value, customer engagement and sustainable growth.

Sigurgeir Orn (“Ziggy”) Jonsson, 46, has served on our board of directors since November 2020. Mr. Jonsson has served as the senior partner and chief technology officer of One Zero Capital, a New York City-based venture capital firm that builds and invests in companies at the nexus of credit and technology, since June 2013. In addition, Mr. Jonsson is an accomplished software engineer, serving as the founding technologist or technology advisor to multiple 1/0 portfolio companies, including Better, Future Finance, Climb, Paribus (acquired by CapitalOne (NYSE: COF)) and Notable. Mr. Jonsson also built the underlying data analytics technology behind PhoenixABS. Mr. Jonsson has also been as the co-Sponsor and chief technology officer of TheNumber since September 2015 and a partner of Ferry Farm Capital Management since September 2015. From September 2015 to June 2019, Mr. Jonsson served on the board of Framtíðin, a student lender based in Iceland. Mr. Jonsson held multiple senior positions at Bank of America (NYSE: BAC), including head of structured credit training, North America from 2006 to 2008 and head of index derivatives, EMEA from 2004 to 2006. Mr. Jonsson received BS in Economics from the University of Iceland. We believe that Mr. Jonsson is qualified to serve on our board of directors because of his experience in corporate finance and valuation.

Woodrow H. Levin, 42, has served on our board of directors since November 2020. Mr. Levin has served on the board of directors of DraftKings Inc. (Nasdaq: DKNG) since December 2013 and has helped the company navigate numerous regulatory and strategic challenges throughout his tenure, culminating in the recent merger with a SPAC, Diamond Eagle Acquisition Corp., in April 2020. Since February 2019, Woody has been the Sponsor and chief executive officer of Extend, Inc., a venture-backed technology company offering an application programming interface-first solution for merchants to offer extended warranties and protection plans. From February 2018 to February 2019, Mr. Levin was the Sponsor and chief executive officer of 3.0 Capital, a multi-strategy crypto asset hedge fund. From August 2015 to February 2018, Mr. Levin was vice president of growth at DocuSign, Inc. (Nasdaq: DOCU) (“DocuSign”), which allows organizations to digitally prepare, sign and manage agreements. Mr. Levin founded Estate Assist, Inc. in February 2014, and has served as its chief executive officer until September 2015, when it was acquired by DocuSign. Mr. Levin received a BA in business from the University of Wisconsin and a JD from the Chicago-Kent School of Law, Illinois Institute of Technology. We believe that Mr. Levin is qualified to serve on our board of directors because of his experience with special purpose acquisition companies.

10X Capital Executive Officer and Director Compensation

10X Capital is an “emerging growth company,” as defined in the Jumpstart our Business Startups Act of 2012, or JOBS Act, and the following is intended to comply with the scaled disclosure requirements applicable to emerging growth companies. No executive officer or director of 10X Capital has received any compensation for services rendered to 10X Capital. No fees of any kind, including finders, consulting or other similar fees, will be paid to any of 10X Capital’s existing stockholders, including its officers and directors, or any of their respective affiliates, prior to, or for any services they render in order to effectuate, the consummation of the mergers. Since its formation, 10X Capital has not granted any stock options, stock appreciation rights, or any other equity or equity-based awards under long-term incentive plans to any of its executive officers or directors.

10X Capital’s executive officers are reimbursed for any out-of-pocket expenses incurred in connection with activities on 10X Capital’s behalf such as identifying potential target businesses and performing due diligence on suitable Mergers. There is no limit on the amount of these out-of-pocket expenses and there will be no review of the reasonableness of the expenses by anyone other than the 10X Capital board of directors, which includes persons who may seek reimbursement, or a court of competent jurisdiction if such reimbursement is challenged. Because of the foregoing, 10X Capital generally does not have the benefit of independent directors examining the propriety of expenses incurred on its behalf and subject to reimbursement. Since inception through May 14, 2021, such reimbursable expenses have totaled less than $75,000 in the aggregate.

Legal Proceedings

There is no material litigation, arbitration, governmental proceeding or any other legal proceeding currently pending or known to be contemplated against 10X Capital, and 10X Capital has not been subject to any such proceeding in the 10 years preceding the date of this proxy statement/prospectus.

today, a significant opportunity exists to address the need of fleet owners to respond to increasing pressure from consumers and regulatory bodies to reduce their carbon footprint and transition their existing fleets or new vehicle purchases toward EVs. According to a January 21, 2021 Business Insider article, last-mile delivery is one of the most expensive parts of the logistics ecosystem, often representing more than 50% of the overall delivery cost. In addition, in order to reduce cost, many logistics companies are also emphasizing the development of innovative solutions to automate last-mile delivery by utilizing autonomous vehicle technology. Because REE products are designed to be agnostic to driving mode, REE believes that it is well positioned to capitalize on this development. In addition, REE believes that its modular approach will enable potential last-mile customers with more dimensional design flexibility that could increase their efficiency and reduce the total cost-per-package therefore positioning REE to capitalize on this development.

•        Mobility-As-A-Service Is Growing Rapidly.    Growth in MaaS is driving demand for new mobility solutions, such as e-shuttles and e-buses, ride sharing, ride hailing and robo-taxis. The growing MaaS market requires new vehicle dimensions and designs in order to capitalize on passenger capacity efficiency. We believe these trends will have a strong positive effect on cost and will be a continuing driver of MaaS adoption, which is forecasted by RethinkX to dramatically expand in the coming years. According to a March 2017 report by RethinkX, MaaS is expected to account for 60% of U.S. passenger vehicles on the road and 95% of miles driven by 2030, representing an important driver of, and opportunity for, new mobility solutions. With Uber and Lyft recently announcing their intention to have all vehicles using their platforms be electric by 2030, the need for EVs suited to ride-sharing applications is clear. We believe that an EV that can offer maximum space on a small footprint would be well positioned to meet the demand for more passenger space in combination with maneuverability in urban driving.

Total Addressable Market

REE intends to initially target commercial and MaaS markets, followed by passenger vehicle markets. REE believes that it is well-positioned to capitalize on additional significant opportunities available in addressing the ever-growing demand for electric mobility.

According to internal calculations based on a forecast analysis report prepared by Frost & Sullivan, REE’s total addressable market globally is projected to be more than $700 billion with steady growth expected to continue as a result of increasing mass market demand for commercial EV solutions in numerous industry sectors. REE’s total addressable market has an expected compound annual growth rate of 31% from 2021 to 2030, according to Frost & Sullivan and REE internal calculations. However, as discussed in “Risk Factors — Risks Related to REE’s Business,” there is no guarantee that REE will be able to capture the total addressable market projected, nor that it will be able to achieve comparable annual growth metrics in the future.

REE Solution

We believe that REEplatforms will be the industry’s flattest and most modular array of EV products. This is expected to result in improved route efficiency, more space for passengers, cargo and batteries, a smaller overall footprint, a lower TCO via reduced maintenance costs and downtime and high design flexibility.

REE’s products are intended to provide potential customers with full design freedom to create the broadest range of EVs for current and future applications, based on such customers’ particular specifications and requirements. We believe that REE’s technology will be ideal for mission-specific EVs in all shapes and sizes, ranging from Class 1 all the way through Class 6, running as small as short-range delivery vehicles or autonomous passenger vehicles at one end of the spectrum, up to as large as large walk-in/mid-duty delivery trucks or a mid-size shuttle buses at the other end.

By avoiding the traditional limitations of legacy vehicle development strategies, REE aims to provide potential customers with a unique value proposition:

•        OEMs.    We believe that the integration of REE products into OEM offerings will enable OEMs to achieve significantly faster time-to-market based on their current supply chains, which is key to enabling agile reactions to evolving business models, market opportunities, regulations and competitive actions. The safety pre-certification of the powertrain components and control system integrated into the REE products and the expected compatibility with advanced driver-assistance systems (“ADAS”) technology that assist drivers in driving and parking functions from level 1 to level 5 is intended to further reduce an OEMs time to market, allowing it to be more agile and to take advantage of prevailing market conditions. In addition, we believe the scalable and modular design of REE products will allow for maximum market coverage and is intended to enable OEMs to enter into new segments and services while reducing in-house development and design costs. We believe that this will enable OEMs to concentrate more on the top-hat design and functionality, as well as connectivity and autonomy, and that this is in line with current and future market trends of platform collaboration between global OEMs.

•        MaaS and logistics service providers.    We are designing REE products to enable MaaS and logistics service providers to develop mission-specific vehicles, customized to their needs, eliminating reliance on limited off-the-shelf vehicle offerings. The REE products are designed to allow for various levels of customized body, functionality, ADAS capability and service layers, and is expected to allow MaaS and logistics service providers to maximize uptime, usage, and revenue generation for their mission-specific

vehicles developed with REE products. In addition, because the REEplatforms are designed to be fully flat and have a low center of gravity, the resulting vehicles aim to offer more interior space with a smaller overall footprint. REE products are designed to be agnostic to power source, size and operator and the REEcorners are designed to be easily swappable and replaceable, which is intended to allow vehicles developed with REE products to be upgraded in response to evolving technology or evolving needs without a complete redesign. We believe that the ability to continually upgrade as necessary, paired with REE’s plan for preventative maintenance, quick REEcorner swap and over-the-air software upgrades will reduce fleet maintenance costs, as well as simplify spare-parts inventory management.

REE’s Technological Differentiation

We believe that the automotive industry is at an inflection point and advances in EV architecture and automotive design offer critical advantages that remain underutilized by most ICE vehicle and EV manufacturers.

Industry approaches and their limitations

The design of the average vehicle has remained relatively unchanged over the last century. The typical format of the ICE vehicle that has become ubiquitous consists of an engine suspended between the front or back wheels, with most other critical vehicle components such as steering, braking, suspension, powertrain and control likewise located centrally between the vehicle wheels. Similarly, most EVs in the market tend to locate these components in a similar manner to ICE vehicles. While this vehicle format is familiar, it is subject to an inherent limitation with respect to both compartment space and vehicle function, maintenance and modularity.

REE sees that ICE vehicle and EV manufacturers employ a correspondingly similar strategy with respect to development of new vehicle platforms: vehicle functionality is determined by the OEM mindset trying to forecast and influence future market trends. This means that, during development, most ICE vehicle and EV manufacturers will design and produce a single new vehicle platform at a time with such vehicle models being restricted with respect to size, shape or functionality. This results in a less nimble development process than is required to respond quickly and effectively to changing market demand and customer preferences unless such demand corresponds with existing “off-the-shelf” offerings. As a result, in trying to address these changes in market preference, ICE vehicle and EV manufacturers are burdened by extremely high capital costs and long development cycles inherent in designing and engineering vehicles.

Consumer preference has continued to shift toward environmentally conscious and low emissions vehicle offerings. However, history shows that many OEMs have traditionally viewed reduced and zero-emissions vehicles as “compliance cars,” adding minimal volumes and models to their portfolios for the lowest possible overall costs (including investment and variable per-unit costs) necessary to achieve fleet compliance. This has resulted in scarce alternative powertrain resources to be dedicated to plug-in hybrid vehicles (PHEVs) and other hybrid powertrains or low-demand battery electric vehicles (BEV) variants. Lacking internal know-how and experience in electrification, many of these OEMs are now being forced to look beyond their internal EV technology in order to meet increasing consumer demand for EVs and to satisfy expanding regulatory requirements.

Finally, typical ICE manufacturers have been burdened by a high total cost of ownership as a result of, among other things, the use of complicated multi-speed transmissions, exhaust systems, mufflers, catalytic converters, fuel injectors or fuel pumps, as well as the relatively high cost of gasoline or diesel as compared to electricity. In addition, traditional ICE vehicles have a significant number of moving components that are exposed to friction during operation and therefore require rigorous and extensive preventative maintenance.

REE’s technology approach

REE’s approach is aimed at providing a dimensional, power-and driver-agnostic, modular platform able to carry the broadest range of EVs for current and future applications through the facilitation of modular and customizable “top hats,” the vehicle body and cabin, based on customer specifications without requiring significant modification to REE’s products.

REE believes that this approach differentiates it from other EV players, who often have to substantially redesign and reengineer their vehicles in order to meet market demand, which typically results in significant expenditure of time and capital on architecture integration, unique performance requirements, different market requirements and full crash structure development and testing, resulting in expensive and lengthy vehicle projects.

REE’s plans to utilize proprietary X-By-Wire Control technology for steering, braking and drive, resulting in no mechanical linkages between the handwheel and the pedal box to the actuators on the REEcorners, or between the REEcorners themselves. Each REEcorner is designed to be a standalone system that is expected to offer a number of technological advantages:

•        Redundancy of critical drive elements that does not exist in conventional ICE and EVs resulting in a safer vehicle.

•        Independent REEcorner steering, braking and torque vectoring projected to deliver higher vehicle stability and a smoother ride.

•        Independence of each REEcorner to enable fast corner replacement in the event of REEcorner malfunction in order to reduce TCO and overall spare part inventory management.

•        Utilization of a fully sprung, close to wheel design which is expected to be more reliable, safe, longer-lasting and easier to maintain than hub-motors.

Competitive Strengths

We believe that REE’s disruptive technology and business model is unique to the EV industry, and will afford a number of competitive strengths.

Scalable and modular architecture for broad range of EVs

We believe that the exceptionally compact design of the REEcorners and the approach to component layout will facilitate platforms that are highly modular and scalable in nature and that are agnostic to size, shape, or application for the creation of mission-specific vehicles. The REEplatform is also designed to be agnostic to power source (battery or fuel cell) or driving mode (manual or autonomous). With a truly modular and adaptable product, REE believes that it will be able to facilitate bringing multiple vehicles to market faster and at a lower cost than traditional automotive industry players. By basing the platform on one interchangeable part, the REEcorner, REE expects to reduce expense in research and development, testing and manufacturing, thereby enabling it to develop and scale future products at a significantly lower overall cost.

In addition to significant anticipated cost-savings advantages, REE believes that its modular architecture will allow it to bring new products to market more rapidly and thus respond more effectively to increasing mass market demand for commercial EV solutions in numerous industry sectors. Further, by designing the REEplatform to be uniquely flat, REE seeks to enable a wide range of body configurations with high design freedom and efficiency of space at a fraction of the cost.

Unique fully horizontal approach to target massive and growing market

REE believes that its focus on the REEcorner architecture allows it to complete, and not compete with, other EV players, such as vertically integrated OEMs, mobility and logistic players. By “completing rather than competing,” REE aims to allow other EV players to concentrate on their core service offerings and get to the market faster at a significantly lower cost, improving their competitive edge as well as creating new e-mobility services. As a truly horizontally integrated player in the EV market, REE plans to embrace traditional Tier 1 suppliers and their global manufacturing capacity, instead of directly competing with them. REE believes that its horizontally integrated approach to the e-mobility sector will allow it to target a $700 billion total addressable market.

Groundbreaking and proprietary technology

REE has designed the world’s flattest EV platform, purposefully engineered with a goal of maximum efficiency of space with a small footprint and modularity to support a wide range of vehicle applications in the B2B market.

We believe that platforms utilizing REEcorners will present significant functional and operational advantages over conventional EV “skateboards” currently available in the market and will enable superior vehicle specifications for cargo volume/length, payload and battery capacity. REE technology is also designed to enable enhanced operational efficiencies due to low center of gravity, high durability, long lifecycle and superior product ergonomics (low step-in height, high visibility, max door openings for ideal driver environments).

REE’s development of proprietary X-By-Wire Control technology challenges century-old automotive concepts by seeking to be agnostic to vehicle size and design, power-source and driving mode. REE’s drive-by-wire, brake-by-wire and steer-by-wire technology is expected to enable lower TCO through expedient REEcorner replacement in under an hour, over-the-air updates and hardware upgrades. REE’s data harvesting capabilities may be used to further reduce TCO via intelligent preventative maintenance features.

REE’s track record of invention and early development of products has given it many years to innovate across hardware and software, which it believes has created substantial advantages in the targeted markets. Our research and development efforts have resulted in a strong intellectual property portfolio, and REE has filed for patent protection for approximately fifty-five of its key inventions, including the REEcorner and REEboard, among others.

CapEx light and flexible manufacturing approach

REE intends to leverage existing modern manufacturing facilities and trained workforce with Tier 1 suppliers and automotive manufacturers, which REE believes will position it well to meet timing, cost, and quality expectations while optimally matching REE’s cost structure with its projected production ramp.

REE plans to manufacture via a secured and global network of Tier 1 partners with point-of-sale assembly and plans to assemble components at its future integration centers, thus reducing capital expenditures. REE expects to have a network of 15 integration centers by 2026 with projected combined annual capacity of up to 600,000 platforms. This approach is intended to allow REE to maintain a comparatively asset-light enterprise that can further help to increase global growth and market penetration.

Attractive customer value proposition and superior TCO

In general, EVs aim to have lower TCO than ICE vehicles. REE believes that EVs built on its products will have lower TCO than those of its EV competitors. REE’s TCO advantages are expected to derive from its expected competitive purchase price due to its capital expenditures light manufacturing model, low costs of operations due to the greater cargo volume that reduces the total cost per route/package and low maintenance costs due to the REEcorner’s durable design. In addition, due to the innovative, self-contained modular design of the REEcorners, time-intensive troubleshooting is expected to be eliminated as a complete REEcorner can be swapped out for a new one in less than one hour in certain conditions with the necessary equipment for a significant reduction in mean repair time. REE plans to work with strategic partners to provide predictive maintenance scheduling through smart service and maintenance AI in combination with over-the-air updates that seek to ensure maintenance is performed before a part will fail, which is expected to offer significant savings by eliminating unnecessary part replacements and drastically reducing downtime. Based on internal projections and assumptions, REE anticipates that EVs built on REEplatforms will have

49% to 59% lower TCO than a comparable vehicle with an internal combustion engine, and 8%-19% lower TCO than comparable electric commercial vehicles. These TCO savings are calculated to include the purchase price, energy cost, charging infrastructure cost, and maintenance cost and are net of estimated residual value. The estimated costs are based on estimated vehicle usage of approximately 365,000 kilometers.

Significant validation from leading strategic partners

REE’s progress has garnered the attention of prospective customers, including leading global automotive manufacturers. REE is currently in discussions with multiple blue-chip industry participants interested in leveraging REE’s technologies and engineering expertise for their own commercial products.

REE’s position as a pioneer in the market has also attracted global leaders across REE’s potential supply chain, creating an extensive network for it to leverage. In August 2020, REE and Mahindra signed a MOU to collaborate in the development and manufacturing of EVs to fulfill REE’s expected global customer demand. Mahindra has agreed to act as a contract manufacturer in providing turnkey design and development services to REE for intended vehicles utilizing the REEcorners provided by REE. REE also signed a strategic collaboration agreement in April 2021 with Magna Services of America, Inc. (“Magna”), one of the world’s largest automotive manufacturers, to collaborate to develop and market a modular EV based solution to new e-mobility and tech companies under the “Powered by REE” brand. REE and Magna will also explore global MaaS opportunities for light commercial vehicles. REE has also entered into strategic partnerships with a number of premier Tier 1 automotive manufacturers and global automotive players including Mitsubishi Corporation, Musashi and KYB.

REE’s Go-To-Market Strategy

REE will be horizontally integrated in the B2B EV market, targeting a majority of the EV market starting with commercial and MaaS applications. REE strives to be the cornerstone upon which global mobility companies build any size or shape of electric car, van, or truck on a truly modular and scalable platform for various applications or target markets. REE intends to market and sell its products as “Powered by REE” in any vehicle solution (similar to the “Intel inside” approach utilized by that chip maker with respect to personal computers in the 1990s).

REE believes that the rapid growth in the logistics and transportation markets, when combined with the global shifts in regulation and consumer preference toward sustainability, offers an opportunity to build a reliable business model via a new kind of horizontally integrated e-mobility strategy. As such, REE aims to collaborate with prominent automotive market participants in bringing mission-specific EVs to the market in either of the following two approaches:

•        Lead mode — REE to work directly with its B2B potential customers in providing them the REE relevant product line ranging from the REEcorners only to the entire REEplatform.

•        Consortium mode — In instances where a full vehicle is required, REE intends to seek collaborations with traditional and new OEMs such that REE will provide the REE products, ranging from the REEcorners only to the entire REEplatform, and the OEM partner will provide the remaining vehicle components, top-hat and homologation. In this approach, REE will seek to split the revenue from each program with its OEM partner based on pre-agreed terms.

REE’s initial focus is on commercial and MaaS markets, to be followed by private and passenger vehicles markets. By focusing product designs on the particular needs of these markets, REE seeks to build strong customer relationships with fleet operators and capture a significant market opportunity as the broad trend of vehicle electrification continues. Within this trend, REE believes that fleet operators, in particular, will be drawn to the lower total cost of ownership and high uptime of EVs, particularly as EVs achieve cost parity with ICEs. Furthermore, REE believes that fleet operators will be drawn to the customizable design of the REE products, which seeks to facilitate mission-specific vehicles to optimize fleet utilization. Fleet usage, which in many cases may involve multiple shorter trips within range of a central base rather than long-distance travel, can reduce the “range anxiety” that has also been a limiting factor in EV adoption.

REE currently plans to market and sell its REE products through direct marketing and business development organizations. REE believes that this direct business development approach will provide REE with an effective and efficient go-to-market strategy. REE’s business development and marketing teams continue to focus on expanding its relationships with OEMs, logistic and commercial players, mobility providers and e-commerce leaders and to expand our market to other industries. REE is a horizontally integrated player and plans to sell its products directly to these OEMs, logistic and commercial players, mobility providers and e-commerce leaders and other customers and end users as a full and overall module. REE does not plan to sell to Tier 1 suppliers, and instead it is partnering with leading Tier 1 suppliers who will provide certain components. REE’s targeted and focused business model is designed to enable it with an advantageous cost structure that requires minimal sales and marketing expenses, eliminating traditional distribution channels and resellers functions.

To date, REE’s products have generated interest from several potential long-term customers. REE has signed an MOU with Mahindra, a leading vehicle manufacturer in India through which REE intends to collaborate in the development and manufacture of EVs to fulfill REE’s expected global customer demand. REE has also signed MOUs with a leading global logistics company and a leading global truck manufacturer.

In addition, in April 2021 REE has entered into a strategic collaboration agreement with Magna regarding how Magna may be able to work with REE to develop new markets and new business models for REE’s corner module technology and design. In June 2021, REE issued to Magna 74,513 ordinary shares representing 0.65% of its share capital pursuant to the collaboration agreement and has agreed to issue additional shares upon achievement of certain revenue and production milestones, which will require definitive purchase orders from third-party customers.

REE has also entered into a strategic development agreement with Navya, pursuant to which REE will develop and supply REEplatform prototypes for a potential commercial relationship.

Pursuant to all such strategic collaborations and discussions, REE is actively engaged with the counterparty in assessing the ability to enter into long-term strategic partnerships to incorporate REE products into EVs with such companies. There can be no assurance that any of these strategic collaborations and discussions will lead to any definitive agreements or lasting or successful business relationships with such potential customers.

To effectively go-to-market, over the next few years, REE must develop a customer-base by continuing to engage in extensive due diligence and signing additional strategic collaborations with leading customers in multiple addressable market segments; continue to advance its strategic collaborations into more definitive agreements and purchase orders when it becomes commercially advantageous to do so; increase its execution capabilities by expanding its relationships with suppliers and building out its Centre of Excellence and assembly facilities; and develop a support network capable of servicing REE-powered vehicles in the field and delivering on the promise of reduced downtime and better total cost of ownership.

REE must successfully complete certain development activities in order to meet its expected production timeline. REE is targeting to complete product validation in 2022. REE’s team of over 100 employees, including engineers, scientists, technicians and staff is committed to achieving the necessary milestones to meet its current production and commercialization timelines. However, delays may occur as a result of the development process, initial production hurdles and COVID-19.

REE’s Products

Overall REE Architecture

By leveraging our modular REEplatform, along with our efficient design and streamlined production process, we anticipate that new vehicle models can be developed and produced in as little as 18 to 24 months. REE is developing the technology for the core hardware and software for its REEcorner and REEcenter electric control units (“ECU”) in house and pursuant to development agreements with certain strategic partners, this is done with the goal of achieving a superior vehicle dynamics algorithm while setting the highest bar for safety working on meeting ASIL D ISO26262 certification by the beginning of 2023.

Each of the component systems that form our REEcorner and REEboard are being engineered for optimal performance and for efficient packaging into our compact REEplatform. We place a strong emphasis on functional integration, meaning that most components are designed to fulfill as many functions as possible, allowing for increased modularity. This is meant to reduce the total number of parts, platform size and weight, ultimately providing more useable interior space in the vehicle cabin and a more overall cost-effective EV offering.

The utility and modularity of the REE platform will be facilitated by a number of key technological advancements and critical design decisions made by REE, which we believe provide distinct advantages over competitor offerings:

The REEcorner.    An independent module integrates critical vehicle components into an area between the chassis and the wheel creating a compact and efficient single module that is controlled via a proprietary X-By-Wire Control technology. Critical vehicle components include motor, drivetrain, suspension, steering, braking and ECU. Each REEcorner may include all or some of these components. Each REEcorner is an independent assembly powered by its own ECU which controls corner level functions. REE has developed four families of REEcorners with different capabilities to allow us to address the majority of the market.

The REEboard.    A fully flat and modular EV chassis that includes the REEcenter control system, thermal management, power converter and power module. The REEcenter is part of the X-By-Wire Control system and is designed to centrally control all the vehicle corners based on REE’s proprietary X-By-Wire Control technology, as well as provide high-level decision making. In addition, the REEcenter communicates with the vehicle controller and battery management system.

A Highly Modular Rolling Chassis.    REE’s technology is designed with assembly considerations in mind. Accordingly, REE products are designed to be manufactured on an entirely independent basis or in parallel with a vehicle top hat, a considerable innovation in design that aims to reduce complexity in assembly and facilitate more efficient production at scale.

Maximum Interior Space.    REEplatform’s design takes advantage of the unique benefits of EV architecture by eliminating the traditional engine compartment, thereby facilitating a flat design and an extremely low center of gravity which enables superior volume utilization across various classes of vehicles.

Compact Footprint, Ideal for Urban Markets.    Without mechanical connection between the REEcorners and the passenger cabin, REE will be able to easily adjust the REEboard wheelbase to accommodate the best dimensions that suit the needs of each customer, as well as typical light and medium duty vehicle types. This compact design will provide for greater space efficiency, enhanced driver ergonomics with low step-in-heights, and enhanced maneuverability in urban environments with tight turning radiuses and space-constrained operating areas.

Proprietary Single-wheel X-By-Wire Control Technology

REEcorners intend to utilize X-By-Wire Control for independent steering, braking and drive control for a single wheel, eliminating all mechanical connections between the steering wheel and pedals in the passenger compartment and the wheels and braking systems. Pursuant to this design, steering, braking and acceleration will be performed entirely through electrical control and will be fully redundant facilitating fail-operational function of each REEcorner (hardware and software).

The development of our advanced X-By-Wire Control system is a critical part of the REEplatform design and will offer a number of significant advantages in vehicle design, engineering and safety. By controlling each REEcorner independently we aim to provide a smoother and safer ride as well as facilitate vehicle maneuverability in the most suitable manner depending on road conditions and drive requirements.

REE’s proprietary X-By-Wire Control technology design also offers weight savings and safety advantages. Eliminating the steering column removes a common source of serious injury in frontal collisions. This technology also aims to offer potential customers a more responsive and smoother driving experience, which we expect to be able to customize for different vehicles and driver preferences through software. Lastly, X-By-Wire Control will be essential for our longer-term vehicle strategy, paving the way for advanced autonomous driving (autonomous level 4/5), wherein a mechanical steering column will no longer serve a central function. REEcorners and X-By-Wire Control technology are expected to be pre-certified for safety with our propriety actuators and software.

Competition

REE believes that its business model is highly differentiated because REE products can be marketed and sold as individual products or as “Powered by REE” in a full vehicle solution. We believe that this ultimately enables REE “to complete rather than compete” with other market participants.

As the EV industry is becoming increasingly more competitive, REE expects competition from a number of companies including ICE vehicles from established automobile manufacturers, and established and new automobile manufacturers with alternative fuel and EV vehicles including hybrids, BEVs and FCEVs. As many traditional and new players seek to enter the EV market, REE believes the primary competitive factors in the EV market will revolve around but not be limited to the following key differentiation factors:

•        technological innovation;

•        product quality and reliability;

•        safety features;

•        market adoption;

•        service options;

•        product performance;

•        design and styling;

•        product price; and

•        manufacturing efficiency.

REE believes that its products will compete favorably on the basis of these factors as it also seeks to incentivize its potential competitors to collaborate instead of compete with REE.

REE Strategic Collaborations

REE has entered into strategic collaborations, consisting of MOUs and strategic, alliance and development agreements, with certain strategic partners, including Hino, Magna, Mahindra and Navya, pursuant to which the parties are entering into discussions to explore forming a strategic alliance and/or jointly developing EVs with REE technology. Such strategic collaborations are generally non-binding and subject to cancellation or require the achievement of development milestones as a precursor to entering into a further definitive agreement. These agreements generally do not set forth specific development timeframes or represent a commitment by either party to develop, produce or deliver REE’s products. While REE expects to be able to develop one or more of these existing agreements into definitive agreements for orders, manufacturing or the provision of other services, as applicable, there can be no guarantee that REE will be able to do so.

REE’s Manufacturing Approach

REE plans to manufacture its products via a secured global network of Tier 1 partners.

In doing so, REE seeks to significantly reduce its up-front capital investment and eliminate the recurring fixed costs and overhead that would be required for REE to own and operate its own product assembly facilities. REE believes this will enable it to remain a comparatively asset-light enterprise which will further help to increase its operating margin and overall return on investment. In addition to lowering REE’s upfront costs, this approach will also support REE’s environmental, social and governance mission by reducing the carbon footprint of its operations.

In furtherance of its outsourced manufacturing approach, REE has entered into strategic collaborations with leading companies and Tier 1 automotive suppliers that can provide REE with access to significant global manufacturing capacity, including American Axle, KYB, Maxion and Musashi. While REE believes these strategic collaborations support REE’s business model, the agreements generally are non-binding. Additionally, such strategic collaborations generally do not set forth specific development timeframes or represent a commitment by either party to purchase, develop, produce or deliver components for REE’s products, and some may be terminated for convenience by either party. REE expects to be able to develop one or more of these existing agreements into definitive agreements for manufacturing or the provision of other services, as applicable; however, REE has not yet entered into any definitive agreements pursuant to which any of these strategic partners will produce REE’s products and there can be no guarantee that REE will be able to do so. See “Risk Factors — REE’s agreements with potential customers, potential suppliers and potential strategic partners are preliminary in nature.”

REE plans to assemble its products at its future integration centers, thus reducing capital expenditure requirements. Further capital expenditure reductions are expected to be realized as a result of REE’s plan to single source total global tooling and equipment requirements. REE is planning to open its first integration center by the end of 2021, with initial shipments expected to begin in 2022 and high-volume production expected to begin in 2023. REE plans to add additional integration centers for projected total global capacity of up to 600,000 platforms by 2026.

The size of each future integration center is expected to be approximately 20,000 square feet and will aim to be able to assemble up to 40,000 REEplatforms per year. Each future integration center is expected to be staffed with approximately 50 employees. Annual volumes in a traditional OEM assembly plant are typically 100,000 to 300,000 units per year with several thousand employees. The initial capital investment required for each REE future integration center is estimated to be approximately $15 million.

REE’s future integration centers are designed to be highly scalable and to be deployed locally in major metropolitan cities worldwide. REE plans to locate its future integration centers close to its potential customers. The presence of REE’s future integration centers in numerous communities worldwide will support local job creation and also create taxable income for local governments and municipalities.

On February 16, 2021, REE announced the establishment of a new UK state-of-the-art Engineering Center of Excellence. The new Engineering Center is intended to expedite REE’s strategic plans to meet anticipated global demand. The Engineering Center will spearhead REE product design, validation, verification and testing, as well as product homologation. REE will also have access to world-class test facilities and a proving ground for physical testing and validation of REE products at the MIRA Technology Park in the UK.

Research and Development

REE has invested significant time and expense into research and development with respect to the REEplatform. REE has a strong combination of engineers with automotive industry experience from Israel, the UK, Germany and the U.S. who together combine innovative thinking with a goal of developing a superior EV product for the automotive market. REE’s ability to obtain and maintain a leadership position in the automotive industry depends in part on its ongoing R&D activities. REE’s R&D team includes engineers and researchers with a diverse range of expertise and diverse levels of experience and academic backgrounds, including holders of B.Sc., M.Sc. and PhD degrees from prestigious academic institutions.

REE is developing proprietary X-by-Wire Control technology (including hardware, software and mechatronics) to deliver a full system solution for the REEplatform architecture.

REE is in the process of negotiating collaboration agreements with leading academic institutions including PhD programs from top universities to further explore its innovative REEplatform architecture and its future potential in the fields of vehicle dynamics and cyber security. In addition, REE is working with a German safety consultancy company to ensure the REE products meet the highest safety requirements of the automotive industry.

REE’s R&D activities are largely conducted at its headquarters in Tel Aviv, Israel, and at its UK subsidiary’s engineering center in Nuneaton, UK.

Softwheel

Softwheel is the first product to be marketed by REE. Given REE’s focus on the automotive sector, the distribution and manufacturing activities of the Softwheel business line are currently limited. See “REE’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Softwheel” for more information.

Intellectual Property

The ability to protect its material intellectual property is paramount to REE’s business. REE relies upon a combination of protections afforded to owners of patents, designs, copyrights, trade secrets, and trademarks, along with employee and third-party non-disclosure agreements and other contractual restrictions to establish and protect its intellectual property rights. In particular, unpatented trade secrets in the fields of research, development and engineering are an important aspect of REE’s business by ensuring that its technology and strategic business assets remain confidential. REE pursues patent protection when REE believes it has developed a patentable invention and the benefits of obtaining a patent outweigh the risks of making the invention public through patent filings.

As of February 2021, REE has approximately 55 pending or allowed patents in the U.S. and globally. REE’s patent applications are directed to, among other things, EV products, component systems and enhanced product manufacturability. REE pursues global registration of its domain names and products and services trademarks. In an effort to protect its brand, as of February 2021, REE had two pending U.S. trademark applications, two registered international trademarks, and two pending international trademark applications.

REE regularly reviews its development efforts to assess the existence and patentability of new inventions, and REE is prepared to file additional patent applications when it determines it would benefit REE’s business to do so.

Facilities

REE’s headquarters is currently located in a 538 square meter facility that REE leases in Tel Aviv, Israel, where REE designs, engineers and develops its products. REE’s lease for this facility expired in February 28, 2021 and was extended by additional 5 months until July 31, 2021. On August 23, 2020, REE entered into an agreement to lease a new headquarters office located in a 3,300 square meter facility that REE leases in Hertzilia, Israel which will replace the current headquarters in Tel Aviv. The lease for the new headquarters is expected to commence in the fourth quarter of 2021, and during the period of time following the expiration of REE’s current headquarters lease and the commencement of its new headquarters lease, REE expects to utilize short-term temporary offices. The lease for the new headquarters expires in mid-2026 and provides REE with the option to extend the term for additional five-year period commencing when the prior term expires.

REE’s Engineering Center for Excellence is located in an 870 square meter facility that REE leases at the MIRA Technology Park in the UK that REE will utilize to spearhead REE product engineering design, validation, verification and testing, as well as product homologation. REE’s lease for this facility expires in April 2023.

Employees

REE prides itself on the talent and expertise of its team. REE works to leverage partnerships and modulate hiring based on its product roadmap. As of April 30, 2021, REE had 124 full-time based primarily in Israel, the UK, the U.S. and Germany. A majority of REE’s employees are engaged in research and development and related functions. REE anticipates significant employee growth as it approaches commercialization. REE’s targeted hires typically have

significant experience working for well-respected original equipment manufacturers, automotive engineering firms and software and technology companies. REE is able to attract and retain talent by creating an environment with clear and open communication, transparency, career and personal development, encouraging creativity, innovation, and taking risks. All employees have the ability to influence day-to-day as well as strategic decisions.

Government Regulations

REE’s EV platform will be subject to, and will be required to comply with, the U.S. National Traffic and Motor Vehicle Safety Act, as amended, and numerous regulatory requirements established by the National Highway Traffic Safety Administration (“NHTSA”), an operating administration of the U.S. Department of Transportation, including applicable FMVSSs. REE intends for the REEplatform to fully comply with all applicable FMVSSs without the need for any exemptions and expects future REE products to either fully comply or comply with limited exemptions related to new technologies. Additionally, there are regulatory changes being considered for several FMVSSs, and while REE anticipates being in compliance with the proposed changes, there is no assurance until final regulation changes are enacted.

Numerous FMVSSs will apply to REE’s products, such as brakes requirements, steering requirements and EV-specific requirements. REE will also be required to comply with other federal laws and regulations administered by NHTSA, including, among other things, ensuring its products do not contain defects related to motor vehicle safety, recall requirements, the corporate average fuel economy (“CAFE”) standards, Theft Prevention Act requirements, consumer information labeling requirements, reporting required notices, bulletins, and other communications, Early Warning Information reporting, foreign recall reporting and owner’s manual requirements.

The battery modules on the REEboard, conform to mandatory regulations that govern transport of “dangerous goods,” defined to include lithium-ion batteries, which may present a risk in transportation. The governing regulations, which are issued by the Pipeline and Hazardous Materials Safety Administration, are based on the UN Recommendations on the Safe Transport of Dangerous Goods Model Regulations and related UN Manual Tests and Criteria. The regulations vary by mode of shipping transportation, such as by ocean vessel, rail, truck or air. Prior to launch, REE plans to complete all applicable transportation tests for its battery modules, demonstrating its compliance with applicable regulations. REE will use lithium-ion cells in the high voltage battery packs in the REEboard. The use, storage, and disposal of the battery modules is regulated under federal law.

Additionally, the REEplatform will be subject to non-U.S. safety, environmental and other regulations. Many of those regulations are different from those applicable in the U.S. and may require redesign and/or retesting. For example, the European Union (“E.U.”) has established new approval and oversight rules requiring that a national authority certify compliance with heightened safety rules, emissions limits and production requirements before vehicles can be sold in each E.U. member state, the initial of which rules were rolled out on September 1, 2020, and there is also regulatory uncertainty regarding how these rules will impact sales in the U.K. given its recent withdrawal from the E.U. These changes could impact the rollout of new features in Europe.

Similarly, as a global company deploying cutting-edge technology, we are also subject to trade, export controls, customs product classification and sourcing regulations. Our operations also are subject to various federal, state and local laws and regulations governing the occupational health and safety of our employees and wage regulations. We are subject to the requirements of the federal Occupational Safety and Health Act, as amended, and comparable state laws that protect and regulate employee health and safety.

Like all companies operating in similar industries, we are subject to environmental regulation, including water use; air emissions; use of recycled materials; energy sources; the storage, handling, treatment, transportation and disposal of hazardous materials; and the remediation of environmental contamination. Compliance with these rules may include the need to obtain permits and licenses and to allow inspections of our facilities and products.

Legal Proceedings

From time to time, REE may become involved in legal proceedings or be subject to claims arising in the ordinary course of its business. REE is not currently a party to any legal proceedings, the outcome of which, if determined adversely to REE, would individually or in the aggregate have a material adverse effect on its business or financial condition.