INTRODUCTORY NOTE
On November 25, 2020 (the Closing Date), QuantumScape Corporation, a Delaware corporation (f/k/a Kensington Capital
Acquisition Corp. (KCAC)) (the Company), consummated the previously announced merger pursuant to that certain Business Combination Agreement, dated September 2, 2020 (the Business Combination
Agreement), by and among KCAC, Kensington Merger Sub Corp., a Delaware corporation and wholly owned subsidiary of KCAC (Merger Sub), and QuantumScape Subsidiary, Inc., a Delaware corporation (f/k/a QuantumScape
Corporation) (Legacy QuantumScape).
Pursuant to the terms of the Business Combination Agreement, a business
combination between the Company and Legacy QuantumScape was effected through the merger of Merger Sub with and into Legacy QuantumScape, with Legacy QuantumScape surviving as the surviving company and as a wholly-owned subsidiary of KCAC (the
Merger and, collectively with the other transactions described in the Business Combination Agreement, the Business Combination). On the Closing Date, the registrant changed its name from Kensington Capital
Acquisition Corp. to QuantumScape Corporation.
At the effective time of the Merger (the Effective Time), and subject
to the terms and conditions of the Business Combination Agreement, each share of Legacy QuantumScape Class A common stock, par value $0.0001 per share, and each share of the Legacy QuantumScape Preferred Stock that was convertible into a share of
Legacy QuantumScape Class A common stock, was canceled and converted into the right to receive the number of shares of the Companys Class A Common Stock, $0.0001 par value per share (the Class A Common Stock) equal to
4.02175014920 (the Exchange Ratio), and each share of Legacy QuantumScape Class B Common Stock, par value $0.0001 per share, and each share of the Legacy QuantumScape Preferred Stock that was convertible into a share of Legacy
QuantumScape Class B common stock was canceled and converted into the right to receive the number of shares the Companys Class B Common Stock, $0.0001 par value per share (the Class B Common Stock, and, together with the
Class A Common Stock, the Common Stock) equal to the Exchange Ratio.
At the Effective Time, each outstanding and
unexercised warrant (Legacy QuantumScape Warrant) to purchase shares of Legacy QuantumScape capital stock was automatically converted into a warrant to purchase a number of shares of the applicable class of Common Stock (such
warrant, the Exchanged Warrant) equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Legacy QuantumScape common stock subject to such Legacy QuantumScape Warrant immediately prior to
the Effective Time multiplied by (ii) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to (A) the exercise price per share of such Legacy QuantumScape Warrant immediately prior to the Effective
Time divided by (B) the Exchange Ratio. Except as specifically provided above, following the Effective Time, each Exchanged Warrant continued to be governed by the same terms and conditions (including vesting and exercisability terms) as were
applicable to the corresponding former Legacy QuantumScape Warrant immediately prior to the Effective Time.
Each option to purchase
shares of Legacy QuantumScape common stock (a Legacy QuantumScape Option) that was outstanding immediately prior to the Effective Time, whether vested or unvested, was converted into an option to purchase a number of shares of the
applicable class of Common Stock that the Legacy QuantumScape Option covered (such option, an Exchanged Option) equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Legacy QuantumScape
Common Stock subject to such Legacy QuantumScape Option immediately prior to the Effective Time and (ii) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to (A) the exercise price per share of such
Legacy QuantumScape Option immediately prior to the Effective Time, divided by (B) the Exchange Ratio. Except as specifically provided in the Business Combination Agreement, following the Effective Time, each Exchanged Option continued to be
governed by the same terms and conditions (including vesting and exercisability terms) as were applicable to the corresponding former Legacy QuantumScape Option immediately prior to the Effective Time.
Each share of restricted stock granted under Legacy QuantumScapes option plans or acquired via the early exercise of Legacy
QuantumScapes options, immediately prior to the Closing (Legacy QuantumScape Restricted Stock) that was outstanding immediately prior to the Effective Time was converted into restricted shares of the applicable class of Common
Stock that the pre-conversion Legacy QuantumScape Restricted Stock covered (such share of restricted Common Stock, an Exchanged Restricted Stock) equal to the product (rounded down to the nearest whole number) of (i) the
number of shares subject to a Legacy QuantumScape Restricted Stock immediately prior to the Effective Time multiplied by (ii) the Exchange Ratio. Except as specifically provided above, following the Effective Time, each Exchanged Restricted
Stock continued be governed by the same terms and conditions (including transfer restrictions and repurchase right terms) as were applicable to the corresponding former Legacy QuantumScape Restricted Stock immediately prior to the Effective Time.
Each outstanding restricted stock unit granted by Legacy QuantumScape, immediately prior to the Closing under Legacy QuantumScape option
plans or otherwise (Legacy QuantumScape RSU) that was outstanding immediately prior to the Effective Time was converted into a restricted stock unit of the applicable class of Common Stock that the pre-conversion Legacy
QuantumScape RSU covered (such restricted stock unit award covering Common Stock, an Exchanged RSU) equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Legacy QuantumScape RSU immediately
prior to the Effective Time multiplied by (ii) the Exchange Ratio. Except as specifically provided above, following the Effective Time, each Exchanged RSU continued to be governed by the same terms and conditions (including transfer
restrictions and repurchase right terms) as were applicable to the corresponding former Legacy QuantumScape RSU immediately prior to the Effective Time.
Immediately prior to the Effective Time, the obligation to purchase shares of Legacy QuantumScapes Series F Preferred Stock, par value
$0.0001 per share (Legacy QuantumScape Series F Preferred Stock), upon satisfaction of certain milestones, if still outstanding, became an obligation to purchase, upon satisfaction of the milestones, shares of Class A Common Stock
equal in number to the shares of Class A Common Stock that would have been issued in the Merger in exchange for such shares of Legacy QuantumScape Series F Preferred Stock if such shares of Legacy QuantumScape Series F Preferred Stock had been
outstanding prior to the Merger.
As of the open of trading on November 27, 2020, the Common Stock and warrants of QuantumScape
Corporation, formerly those of KCAC, began trading on The New York Stock Exchange (NYSE) as QS and QS.W, respectively.
As used in this Current Report on Form 8-K henceforward, unless otherwise stated or the context
clearly indicates otherwise, the terms the Company, Registrant, we, us and our refer to the parent entity formerly named Kensington Capital Acquisition Corp., after giving effect to the
Business Combination, and as renamed QuantumScape Corporation.
A description of the Business Combination and the terms of the Business
Combination Agreement are included in the proxy statement/prospectus/information statement filed with the Securities and Exchange Commission (the SEC) on November 12, 2020 (the Proxy Statement) in the
sections entitled The Business Combination beginning on page 93 and The
Business Combination Agreement beginning on page 107 of the Proxy Statement.
On November 25, 2020, a number of purchasers
(each, a Subscriber) purchased from the Company an aggregate of 50,000,000 shares of Class A Common Stock (the PIPE), for a purchase price of $10.00 per share and an aggregate purchase price of
$500.0 million (the PIPE Shares), pursuant to separate subscription agreements (each, a Subscription Agreement) entered into effective as of September 2, 2020. Pursuant to the Subscription Agreements,
the Company gave certain registration rights to the Subscribers with respect to the PIPE Shares. The sale of PIPE Shares was consummated concurrently with the closing of the Business Combination (the Closing).
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