QuantumScape : NOTICE OF REDEMPTION OF WARRANTS (Form 8-K)

NOTICE OF REDEMPTION OF WARRANTS

Dear Warrant Holder,

QuantumScape Corporation (the 'Company') hereby gives notice that it is redeeming, at 5:00 p.m. Eastern Daylight Time on September 30, 2021 (the 'Redemption Date'), all of the Company's outstanding Warrants (as defined in the Warrant Agreement) (the 'Warrants') to purchase shares of the Company's Class A common stock, $0.0001 par value per share (the 'Common Stock') for a redemption price of $0.10 per Warrant (the 'Redemption Price'), that were issued under the Warrant Agreement, dated as of June 25, 2020, as amended on February 13, 2021 (the 'Warrant Agreement'), by and between the Company's predecessor company, Kensington Capital Acquisition Corp. ('Kensington'), and Continental Stock Transfer & Trust Company, as warrant agent (the 'Warrant Agent'), as part of the units sold in Kensington's initial public offering (the 'IPO').

Each Warrant entitles the holder thereof to purchase one share of Common Stock for a purchase price of $11.50 per whole share, subject to adjustment. Any Warrants that remain unexercised at 5:00 p.m. Eastern Daylight Time on the Redemption Date will be void and no longer exercisable and their holders will have no rights with respect to those Warrants, except to receive the Redemption Price. For the avoidance of doubt, all outstanding Warrants, includingPrivate Placement Warrants and Working Capital Warrants (both as defined in the Warrant Agreement) are subject to this notice of redemption.

The shares of Common Stock are listed on the New York Stock Exchange under the symbol 'QS.' On August 27, 2021, the last reported sale price of the Common Stock was $21.48 per share.

TERMS OF REDEMPTION; CESSATION OF RIGHTS

The rights of the Warrant holders to exercise their Warrants will terminate immediately prior to 5:00 p.m. Eastern Daylight Time on the Redemption Date. At 5:00 p.m. Eastern Daylight Time on the Redemption Date and thereafter, the Warrants will no longer be exercisable and the holders of unexercised Warrants will have no rights with respect to those Warrants, except to receive the Redemption Price. We encourage you to consult with your financial advisor and/or tax advisor to consider whether or not to exercise your Warrants.

The Company is exercising this right to redeem the Warrants pursuant to Section 6 of the Warrant Agreement. Pursuant to Section 6.2 of the Warrant Agreement, the Company has the right to redeem all of the outstanding Warrants if the last sales price of the Common Stock reported has been at least $10.00 per share on the trading day prior to the date on which a notice of redemption is given. The last sales price of the Common Stock on August 27 2021, the trading day prior to the date on which this notice of redemption is being given, was at least $10.00 per share.

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EXERCISE PROCEDURE

Warrant holders have until immediately prior to 5:00 p.m. Eastern Daylight Time on the Redemption Date to exercise their Warrants to purchase shares of Common Stock. Warrants may be exercised for cash pursuant to Section 3.3.1(a) of the Warrant Agreement, or on a 'cashless basis' pursuant to Section 3.3.1 (c) or Section 3.3.1 (d) of the Warrant Agreement.

Payment of the exercise funds by cash pursuant to Section 3.3.1(a) of the Warrant Agreement may be made by wire transfer of immediately available funds.

Persons who are holders of record of their Warrants may exercise their Warrants by sending:

1.

The Warrant Certificate;

2.

A fully and properly completed 'Election to Purchase' (a form of which is attached hereto as Annex A), duly executed and indicating, among of things, the number of Warrants being exercised; and

3.

If exercising by cash pursuant to Section 3.3.1(a) of the Warrant Agreement, the exercise funds via wire transfer,

to:

Continental Stock Transfer & Trust Company

1 State Street, 30th Floor

New York, NY 10004

Attention: Compliance Department

Telephone: [phone]

E-mail: [e-mail]; [e-mail]

The method of delivery of the Warrants is at the option and risk of the holder, but if mail is used, registered mail properly insured is suggested.

The Warrant Certificate, the fully and properly completed Election to Purchase and (if applicable) the exercise funds must be received by Continental Stock Transfer & Trust Company prior to 5:00 p.m. Eastern Daylight Time on the Redemption Date. Subject to the following paragraph, any failure to deliver a fully and properly completed Election to Purchase together with the related Warrant Certificate and exercise funds before such time will result in such holder's Warrants being redeemed at the Redemption Price of $0.10 per Warrant and not exercised.

PROSPECTUS

A prospectus covering the shares of Common Stock issuable upon the exercise of the Warrants (and the supplements thereto) is included in a registration statement filed with, and declared effective by, the Securities and Exchange Commission (Registration No. 333-251433) (the 'SEC'). The SEC also maintains an Internet website that contains a copy of this prospectus. The address of this site is www.sec.gov. Alternatively, to obtain a copy of the prospectus (and the supplements thereto), please visit our investor relations website (ir.quantumscape.com).

REDEMPTION PROCEDURE

Payment of the Redemption Price will be made by the Company upon presentation and surrender of a Warrant for payment after 5:00 p.m. Eastern Daylight Time on the Redemption Date.

*********************************

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Any questions you may have about redemption and exercising your Warrants may be directed to the Warrant Agent at its address and telephone number set forth above.

Sincerely,

QUANTUMSCAPE CORPORATION

/s/ Kevin Hettrich

Name: Kevin Hettrich

Title: Chief Financial Officer

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ANNEX A

QUANTUMSCAPE CORPORATION

(the 'Company')

Election to Purchase

(To Be Executed Upon Exercise of Warrant)

The undersigned is the holder of Warrants of the Company and hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, to receive the number ofshares of Class A Common Stock of the Company $0.0001 par value per share (the 'Common Stock') as set forth below and herewith tenders payment for such shares of Common Stock, to the order of QuantumScape Corporation (the 'Company') in accordance with the terms of the Warrant Agreement, pursuant to (choose one of the following):

☐ Section 3.3.1(a): in lawful money of the United States, in good certified check or good bank draft payable to the Warrant Agent or by wire transfer of immediately available funds in the amount calculated as follows:

a.		is the number of shares of Common Stock underlying the Warrants the undersigned is exercising pursuant to Section 3.3.1(a)
b.  $		is the aggregate Exercise Price representing the product of the number shares underlying the Warrants being exercised pursuant to Section 3.3.1(a) as represented in 'a.' multiplied by the $11.50 per share Exercise Price.

☐ Section 3.3.1(c): on a 'cashless basis' calculated as follows:

c.		is the number of shares of Common Stock underlying the Warrants the undersigned is exercising pursuant to Section 3.3.1(c)
d.  $		is the Sponsor Fair Market Value (calculated on Schedule A)
e.   $		is the product of the number of shares underlying the Warrants being exercised pursuant to Section 3.3.1(c) multiplied by the excess of the 'Sponsor Fair Market Value' over $11.50 (i.e., 'c.' x ('d.' - $11.50))
f.		is the number of shares of Common Stock issued on exercise of the Warrants pursuant to 3.3.1(c) (i.e., 'e.' divided by 'd.')

☐ Section 3.3.1(d): as a 'Make-Whole Exercise' on a 'cashless basis' calculated as follows; provided that the undersigned understands and acknowledges that this method of exercise will not be available if at any point between the date of the Notice of Redemption and the Redemption Date the registration statement covering the issuance of the Common Stock issuable upon the exercise of the Warrants ceases to be effective or the prospectus replaying to such Common Stock ceases to be available:

g.		is the number of shares of Common Stock underlying the Warrants the undersigned is exercising pursuant to Section 3.3.1(d)
h.  49		is the number of months from the Redemption Date to the expiration date of the Warrants
i.   ³$18.00		is the Fair Market Value (calculated on Schedule B)
j.   0.365		is the ratio obtained using the values obtained in 'h.' and 'i.' by reference to the table set forth in Section 6.2 of the Warrant Agreement
k.		is the number of shares of Common Stock issued on exercise of the Warrants pursuant to 3.3.1(d) (i.e., 'j.' multiplied by 'g.')

The undersigned requests that a certificate for such shares of Common Stock be registered in the name and address of the undersigned as specified below, and that such shares of Common Stock be delivered to whose address is .

(Date)

(Signature)

(Address)

(Tax Identification Number)

Signature Guaranteed:

THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO SEC RULE 17Ad-15 (OR ANY SUCCESSOR RULE)) UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

SCHEDULE A

$		last reported sale price of the Common Stock on , 2021 (3 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (4 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (5 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (6 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (7 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (8 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (9 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (10 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (11 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		last reported sale price of the Common Stock on , 2021 (12 trading days prior to date the letter is delivered to Continental Stock Transfer & Trust Company)
$		AVERAGE OF THE TEN NUMBERS ABOVE = 'SPONSOR FAIR MARKET VALUE'

SCHEDULE B

$21.25		last reported sale price of the Common Stock on August 25, 2021 (3 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$21.30		last reported sale price of the Common Stock on August 24, 2021 (4 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$20.59		last reported sale price of the Common Stock on August 23, 2021 (5 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$19.61		last reported sale price of the Common Stock on August 20, 2021 (6 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$19.30		last reported sale price of the Common Stock on August 19, 2021 (7 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$20.30		last reported sale price of the Common Stock on August 18, 2021 (8 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$20.23		last reported sale price of the Common Stock on August 17, 2021 (9 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$20.66		last reported sale price of the Common Stock on August 16, 2021 (10 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$21.74		last reported sale price of the Common Stock on August 13, 2021 (11 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$22.52		last reported sale price of the Common Stock on August 12, 2021 (12 trading days prior to August 30, 2021, the date on which the notice of redemption is sent to the holders of the Warrants)
$20.75		AVERAGE OF THE TEN NUMBERS ABOVE = 'FAIR MARKET VALUE'