Document:

EXHIBIT 10.3

 

VTV THERAPEUTICS INC.

INDUCEMENT AWARD

NONQUALIFIED

OPTION AWARD AGREEMENT

THIS INDUCEMENT AWARD NONQUALIFIED OPTION
AWARD AGREEMENT (the “Agreement”), is entered into as of October 19, 2021 (the “Date of Grant”),
by and between vTv Therapeutics Inc., a Delaware corporation (the “Company”), and Deepa Prasad (the
“Participant”).

 

WHEREAS, the Board has determined that it is
in the best interests of the Company and its stockholders to grant the Option provided for herein to the Participant subject to the terms
set forth herein.

NOW, THEREFORE, for and in consideration of the
premises and the covenants of the parties contained in this Agreement, and for other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties hereto, for themselves, their successors and assigns, hereby agree as follows:

1.          Grant of Option.

 

(a)           Inducement
Award Grant. The Company hereby grants to the Participant an Option (the “Option”) to purchase 2,498,635
shares of Class A Common Stock (such shares, the “Option Shares”), on the terms and conditions set forth in this
Agreement The Option is granted as an employment inducement award pursuant to Listing Rule 5635(c) of the corporate governance rules
of the NASDAQ Stock Market. Accordingly, the Option is being granted outside of the Company’s existing equity compensation
plans. However, the Option will be governed in all respects as if issued under the Company’s 2015 Omnibus Equity Incentive
Plan , as amended from time to time (the “Plan”), as in effect on the date of its adoption by the Board and as
may be amended thereafter from time to time. Accordingly, the terms of the Plan are hereby incorporated by reference. The Option is
not intended to be, and shall not be treated as, an incentive stock option, as defined in Section 422 of the U.S. Internal
Revenue Code of 1986, as amended. The Options shall vest in accordance with Section 2. The Exercise Price shall be $1.47 per Option
Share.

 

(b)          
Incorporation by Reference. The provisions of the Plan are incorporated herein by reference. Except as otherwise expressly
set forth herein, this Agreement shall be construed in accordance with the provisions of the Plan and any interpretations, amendments,
rules and regulations promulgated by the Committee from time to time pursuant to the Plan. Any capitalized terms not otherwise defined
in this Agreement shall have the definitions set forth in the Plan. The Committee shall have final authority to interpret and construe
the Plan and this Agreement and to make any and all determinations under them, and its decision shall be binding and conclusive upon
the Participant and his legal representative in respect of any questions arising under the Plan or this Agreement. The Participant acknowledges
that he or she has received a copy of the Plan and has had an opportunity to review the Plan and agrees to be bound by all the terms
and provisions of the Plan.

 

2.          Vesting. 

 

 

    	 	 	 

     

    

 

(a)          
 Except as may otherwise be provided herein subject to the Participant’s continued employment or service with the Company
or an Affiliate, the Options shall become vested and exercisable on the third anniversary of the Date of Grant (the “Vesting
Date”)

 

(b)          
Notwithstanding the preceding Section 2(a), all or portion of the Options may accelerate and vest prior to the Vesting Date, subject
to the achievement of the performance measures as set forth on Exhibit A, attached hereto.

 

3.          Termination of Employment or Service.

 

(a)          
Except as otherwise provided herein if the Participant’s employment or service with the Company and its Affiliates terminates
for any reason other than as set forth in Section 3(b) hereof, the unvested portion of the Option shall be cancelled immediately, and
the Participant shall immediately forfeit any rights to the Option Shares subject to such unvested portion.

 

(b)          
Notwithstanding Section 3(a), if the Participant’s employment with the Company and its Affiliates is terminated by the Company
or its Affiliates without Cause (other than for death or disability) or by the Participant for Good Reason (collectively a “Qualifying
Termination”), then the Participant shall vest in the Pro Rata Amount of Options (less any portion of the Options which previously
vested. “Pro Rata Amount” shall means the number of Options multiplied by a fraction (which shall not be greater than
one (1) with (i) the numerator equal to the number of days the Participant is employed by the Company or an Affiliate commencing on the
Grant Date through the date of termination and (ii) the denominator equal to 1096. Cause and Good Reason shall have the meaning set forth
in the Participant’s employment agreement with vTv Therapeutics LLC dated October 19, 2021.

 

(c)          
In the event of a Qualifying Termination on or within 12 months following a Change in Control, then all Options held by such Participant
that are outstanding shall become immediately exercisable with respect to 100% of the shares subject to such Options.

 

4.          Expiration. 

 

(a)          
In no event shall all or any portion of the Option be exercisable after the tenth annual anniversary of the Date of Grant (such
ten-year period, the “Option Period”); provided, that, if the Option Period would expire at a time when trading
in the shares of Class A Common Stock is prohibited by the Company’s securities trading policy (or Company-imposed “blackout
period”), the Option Period shall be automatically extended until the 30th day following the expiration of such prohibition
(but not to the extent any such extension would otherwise violate Section 409A of the Code).

 

(b)          
If, prior to the end of the Option Period, the Participant’s employment or services with the Company and all Affiliates is
terminated by the Company without Cause or by the Participant for any reason, the Option shall expire on the earlier of the last day of
the Option Period or the date that is 90 days after the date of such termination. In the event of a termination described in this subsection
(b), the Option shall remain exercisable by the Participant until its expiration only to the extent the Option was exercisable at the
time of such termination or in the case of termination after Change-in-Control.

 

(c)          
If (x) the Participant’s employment or service is terminated prior to the end of the Option Period on account of his or her
Disability, (y) the Participant dies while still in the employ of the Company or an Affiliate or (z) the Participant dies following a
termination described in subsection (b) above but prior to the expiration of an Option, the Option shall expire on the earlier of the
last day of the

 

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Option Period or the date that is one year after the date of death or termination
on account of Disability of the Participant, as applicable. In such event, the Option shall remain exercisable by the Participant or his
beneficiary, as applicable, until its expiration only to the extent the Option was exercisable by the Participant at the time of such
event.

 

(d)          
If the Participant ceases employment or service with the Company or any Affiliates due to a termination for Cause or a termination
for any reason at a time when grounds to terminate the Participant’s employment for Cause exist, the Option (including any vested
portion of the Option) shall expire immediately upon such termination.

 

5.          Method of Exercise and Form of Payment. No Option Shares shall be delivered pursuant to any exercise of the Option until payment
in full is made to the Company of the Exercise Price and an amount equal to any U.S. federal, state, local and non-U.S. income and employment
taxes required to be withheld is withheld. The Option may be exercised by delivery of written or electronic notice of exercise to the
Company or its designee (including a third party administrator) in accordance with the terms hereof. The Exercise Price and all applicable
required withholding taxes shall be payable (i) in cash, check, cash equivalent (including bank or certified check or wire transfer) and/or
in shares of Class A Common Stock (or any combination of the foregoing) valued at the Fair Market Value at the time the Option is exercised
(including, pursuant to procedures approved by the Committee, by means of attestation of ownership of a sufficient number of shares of
Class A Common Stock in lieu of actual delivery of such shares to the Company); provided, that, such shares of Class A Common Stock
are not subject to any pledge or other security interest; or (ii) by such other method as the Committee may in its sole discretion permit,
including without limitation: (A) in other property having a fair market value equal to the Exercise Price and all applicable required
withholding taxes or (B) if there is a public market for the shares of Class A Common Stock at such time, by means of a broker-assisted
“cashless exercise” pursuant to which the Company is delivered a copy of irrevocable instructions to a stockbroker to sell
the shares of Class A Common Stock otherwise deliverable upon the exercise of the Option and to deliver promptly to the Company an amount
equal to the Exercise Price and all applicable required withholding taxes; or (C) by means of a “net exercise” procedure effected
by withholding the number of shares of Class A Common Stock otherwise deliverable in respect of an Option that are needed to pay for the
Exercise Price and all applicable required withholding taxes up to the maximum statutory withholding rate. Any fractional shares of Class
A Common Stock shall be settled in cash.

 

6.          Rights as a Stockholder. The Participant shall not be deemed for any purpose to be the owner of any shares of Class A Common
Stock subject to this Option unless, until and to the extent that (i) this Option shall have been exercised pursuant to its terms,
(ii) the Company shall have issued and delivered to the Participant the Option Shares and (iii) the Participant’s name
shall have been entered as a stockholder of record with respect to such Option Shares on the books of the Company. The Company shall cause
the actions described in clauses (ii) and (iii) of the preceding sentence to occur promptly following settlement as contemplated by this
Agreement, subject to compliance with applicable laws.

 

7.          Compliance with Legal Requirements.

 

(a)          
Generally. The granting and exercising of the Option, and any other obligations of the Company under this Agreement, shall
be subject to all applicable U.S. federal, state and local laws, rules and regulations, all applicable non-U.S. laws, rules and regulations
and to such approvals by any regulatory or governmental agency as may be required. The Participant agrees to take all steps the Committee
or the Company determines are reasonably necessary to comply with all applicable provisions of U.S. federal and state securities law and
non-U.S. securities law in exercising his or her rights under this Agreement.

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(b)          
Tax Withholding. Any exercise of the Option shall be subject to the Participant satisfying any applicable U.S. federal,
state and local tax withholding obligations and non-U.S. tax withholding obligations. The Company shall have the right and is hereby authorized
to withhold from any amounts payable to the Participant in connection with the Option or otherwise the amount of any required withholding
taxes in respect of the Option, its exercise or any payment or transfer of the Option or under the Plan and to take any such other action
as the Committee or the Company deem necessary to satisfy all obligations for the payment of such withholding taxes. The Committee, may
in its sole discretion permit the Participant to satisfy, in whole or in part, the tax obligations by withholding shares of Class A Common
Stock that would otherwise be received upon exercise of the Option with a Fair Market Value equal to such withholding liability (but no
more than the maximum required statutory withholding liability).

8.          Clawback. Notwithstanding anything to the contrary contained herein, the Committee may cancel the Option award if the Participant,
without the consent of the Company, has engaged in or engages in activity that is in conflict with or adverse to the interest of the Company
or any Affiliate while employed by or providing services to the Company or any Affiliate, including fraud or conduct contributing to any
financial restatements or irregularities, or violates a non-competition, non-solicitation, non-disparagement or non-disclosure covenant
or agreement with the Company or any Affiliate, as determined by the Committee. In such event, the Participant will forfeit any compensation,
gain or other value realized thereafter on the vesting or exercise of the Option, the sale or other transfer of the Option, or the sale
of shares of Class A Common Stock acquired in respect of the Option, and must promptly repay such amounts to the Company. If the Participant
receives any amount in excess of what the Participant should have received under the terms of the Option for any reason (including without
limitation by reason of a financial restatement, mistake in calculations or other administrative error), all as determined by the Committee,
then the Participant shall be required to promptly repay any such excess amount to the Company. To the extent required by applicable law
and/or the rules and regulations of NASDAQ or any other securities exchange or inter-dealer quotation system on which the Class A Common
Stock is listed or quoted, or if so required pursuant to a written policy adopted by the Company, the Option shall be subject (including
on a retroactive basis) to clawback, forfeiture or similar requirements (and such requirements shall be deemed incorporated by reference
into this Agreement).

 

9.          Restrictive Covenants. In the event that the Participant violates any restrictive covenants applicable to the Participant,
in addition to any other remedy which may be available at law or in equity, the Option shall be forfeited effective as of the date on
which such violation first occurs, unless otherwise determined by the Committee. The foregoing rights and remedies are in addition to
any other rights and remedies that may be available to the Company and shall not prevent (and the Participant shall not assert that they
shall prevent) the Company from bringing one or more actions in any applicable jurisdiction to recover damages as a result of the Participant’s
breach of such restrictive covenants.

 

10.          Miscellaneous.

 

(a)          
Transferability. The Option may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered
(a “Transfer”) by the Participant other than by will or by the laws of descent and distribution, pursuant to a qualified
domestic relations order or as otherwise permitted under Section 15(b) of the Plan. Any attempted Transfer of the Option contrary to the
provisions hereof, and the levy of any execution, attachment or similar process upon the Option, shall be null and void and without effect.

 

(b)          
Waiver. Any right of the Company contained in this Agreement may be waived in writing by the Committee. No waiver of any
right hereunder by any party shall operate as a waiver of any

 

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other right, or as a waiver of the same right with respect to any subsequent
occasion for its exercise, or as a waiver of any right to damages. No waiver by any party of any breach of this Agreement shall be held
to constitute a waiver of any other breach or a waiver of the continuation of the same breach.

 

(c)          
Section 409A. The Option is not intended to be subject to Section 409A of the Code. Notwithstanding the foregoing or any
provision of the Plan or this Agreement , if any provision of the plan or this Agreement contravenes Section 409A of the Code or could
cause the Participant to incur any tax, interest or penalties under Section 409A of the Code, the Committee may, in its sole discretion
and without the Participant’s consent, modify such provision to (i) comply with, or avoid being subject to, Section 409A of the
Code, or to avoid the incurrence of taxes, interest and penalties under Section 409A of the Code, and/or (ii) maintain, to the maximum
extent practicable, the original intent and economic benefit to the Participant of the applicable provision without materially increasing
the cost to the Company or contravening the provisions of Section 409A of the Code. This Section 10(c) does not create an obligation on
the part of the Company to modify the Plan or this Agreement and does not guarantee that the Option or the Option Shares will not be subject
to interest and penalties under Section 409A.

 

(d)          
Notices. Any notices provided for in this Agreement or the Plan shall be in writing and shall be deemed sufficiently given
if either hand delivered or if sent by fax, pdf/email or overnight courier, or by postage paid first class mail. Notices sent by mail
shall be deemed received three (3) business days after mailing but in no event later than the date of actual receipt. Notices shall be
directed, if to the Participant, at the Participant’s address indicated by the Company’s records, or if to the Company, to
the attention of the Chief Financial Officer of the Company at the Company’s principal executive office.

 

(e)          
Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent
permitted by law.

 

(f)           
No Rights to Employment or Service. Nothing contained in this Agreement shall be construed as giving the Participant any
right to be retained, in any position, as an employee, consultant or director of the Company or its Affiliates or shall interfere with
or restrict in any way the rights of the Company or its Affiliates, which are hereby expressly reserved, to remove, terminate or discharge
the Participant at any time for any reason whatsoever.

 

(g)          
Fractional Shares. In lieu of issuing a fraction of a share of Class A Common Stock resulting from any exercise of the Option
or an adjustment of the Option pursuant to Section 12 of the Plan or otherwise, the Company shall be entitled to pay to the Participant
an amount in cash equal to the Fair Market Value of such fractional share.

 

(h)          
Beneficiary. The Participant may file with the Committee a written designation of a beneficiary on such form as may be prescribed
by the Committee and may, from time to time, amend or revoke such designation.

 

(i)           
Successors. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors
and assigns, and of the Participant and the beneficiaries, executors, administrators, heirs and successors of the Participant.

 

(j)           
Entire Agreement. This Agreement and the Plan contain the entire agreement and understanding of the parties hereto with
respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto.
No change, modification or

 

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waiver of any provision of this Agreement shall be valid unless the same
be in writing and signed by the parties hereto, except for any changes permitted without consent under Section 12 or 14 of the Plan.

 

(k)          Governing Law and Venue. This Agreement shall be construed and interpreted in accordance with the laws of the State of Delaware,
without regard to principles of conflicts of laws thereof, or principles of conflicts of laws of any other jurisdiction which could cause
the application of the laws of any jurisdiction other than the State of Delaware.

 

(i)           
Dispute Resolution; Consent to Jurisdiction. All disputes between or among any Persons arising out of or in any way connected
with the Plan, this Agreement or the Option shall be solely and finally settled by the Committee, acting in good faith, the determination
of which shall be final. Any matters not covered by the preceding sentence shall be solely and finally settled in accordance with the
Plan, and the Participant and the Company consent to the personal jurisdiction of the United States Federal and state courts sitting in
Wilmington, Delaware as the exclusive jurisdiction with respect to matters arising out of or related to the enforcement of the Committee’s
determinations and resolution of matters, if any, related to the Plan or this Agreement not required to be resolved by the Committee.
Each such Person hereby irrevocably consents to the service of process of any of the aforementioned courts in any such suit, action or
proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to the last known address of such Person,
such service to become effective ten (10) days after such mailing.

 

(ii)             
Waiver of Jury Trial. Each party hereto hereby waives, to the fullest extent permitted by applicable law, any right it may
have to a trial by jury in any legal proceeding directly or indirectly arising out of or relating to this Agreement or the transactions
contemplated (whether based on contract, tort or any other theory). Each party hereto (A) certifies that no representative, agent or attorney
of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce
the foregoing waiver and (B) acknowledges that it and the other parties hereto have been induced to enter into this Agreement by, among
other things, the mutual waivers and certifications in this section.

 

(l)          Headings; Gender. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis
for interpretation or construction, and shall not constitute a part, of this Agreement. Masculine pronouns and other words of masculine
gender shall refer to both men and women as appropriate.

 

(m)         Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan
(pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall
become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties.

 

(n)          Electronic
Signature and Delivery. This Agreement may be accepted by return signature or by electronic confirmation. By accepting this Agreement,
the Participant consents to the electronic delivery of prospectuses, annual reports and other information required to be delivered by
U.S. Securities and Exchange Commission rules (which consent may be revoked in writing by the Participant at any time upon three (3)
business days’ notice to the Company, in which case subsequent prospectuses, annual reports and other information will be delivered
in hard copy to the Participant).

(o)         Electronic
Participation. The Company may, in its sole discretion, decide to deliver any documents related to this award by electronic means.
The Participant hereby consents to receive such documents by electronic delivery and agrees to participate through an on-line or electronic
system

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established and maintained by the Company or a third party designated
by the Company to the extent so requested by the Company.

 

 

 

 

 

 

 

[Remainder of page intentionally blank]

 

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IN WITNESS WHEREOF, this Agreement has been executed
by the Company and the Participant as of the day first written above.

 

	 	VTV THERAPEUTICS INC.	 
	 	 	 
	 	By:	/s/ Robin E. Abrams	 
	 		Name: Robin E. Abrams
	 
	 		Title: Executive Chair	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	/s/ Deepa Prasad	 
	 	DEEPA PRASAD	 

 

 

 

 

[Signature Page to Prasad Option Agreement]

    	 	 	 

     

    

 

EXHIBIT A

 

 

If during the Term (as defined in the Employment Agreement), the Company
obtains a third party(ies) (non- affiliated) investment of $50 million or more in a Board approved transaction or series of integrated
transactions, then one-third of the Option (less any amount previously vested) shall vest upon the consummation of such investment.

 

If during the Term, the Company obtains a third party(ies) (non- affiliated)
investment of $100 million or more in a Board approved transaction or series of integrated transactions, then 50% of the Option (less
any amount previously vested) shall vest upon the consummation of such investment.

 

If during the Term, the Company completes and announces successful pivotal
Phase 3 trials for TTP399, then 75% of the Option (less any amount previously vested) shall vest upon such announcement.

 

If during the Term, the Company receives FDA approval of a New Drug Application
for TTP399, then 100% of the Option (less any amount previously vested) shall vest upon such approval.

 

The Board shall determine in good faith whether the performance vesting
has been achieved under this Exhibit A and, for the avoidance of doubt, the Board shall be permitted to make adjustments as set forth
in section 12 of the Plan.

 

 

 

    	 	2pcct-ex103_11.htm

 

Exhibit 10.3

INVESTMENT MANAGEMENT TRUST AGREEMENT

This Investment Management Trust Agreement (this “Agreement”) is made effective as of [_____], 2021, by and between Perception Capital Corp. II, a Cayman Islands exempted company (the “Company”), and Continental Stock Transfer & Trust Company, a New York corporation (the “Trustee”).

WHEREAS, the Company’s registration statement on Form S-1, File No. 333-255107 (the “Registration Statement”), and prospectus (the “Prospectus”) for the initial public offering of the Company’s units (the “Units”), each of which consists of one of the Company’s Class A ordinary shares, par value $0.0001 per share (each, an “Ordinary Share”), and one-third of one redeemable warrant, each whole warrant entitling the holder thereof to purchase one Ordinary Share (such initial public offering hereinafter referred to as the “Offering”), has been declared effective as of the date hereof by the U.S. Securities and Exchange Commission; and

WHEREAS, the Company has entered into an Underwriting Agreement (the “Underwriting Agreement”) with Jefferies LLC, as representative of the several underwriters (the “Underwriters”) named therein; and

WHEREAS, as described in the Prospectus, $200,000,000 of the gross proceeds of the Offering and sale of the Private Placement Warrants (as defined in the Underwriting Agreement) (or $230,000,000 if the Underwriters’ over-allotment option is exercised in full) will be delivered to the Trustee to be deposited and held in a segregated trust account located at all times in the United States (the “Trust Account”) for the benefit of the Company and the holders of Ordinary Shares included in the Units issued in the Offering as hereinafter provided (the amount to be delivered to the Trustee (and any interest subsequently earned thereon) is referred to herein as the “Property,” the shareholders for whose benefit the Trustee shall hold the Property will be referred to as the “Public Shareholders,” and the Public Shareholders and the Company will be referred to together as the “Beneficiaries”); and

WHEREAS, pursuant to the Underwriting Agreement, a portion of the Property equal to $7,000,000, or $8,050,000 if the Underwriters’ over-allotment option is exercised in full, is attributable to deferred underwriting discounts and commissions that may be payable by the Company to the Underwriters upon the consummation of the Business Combination (as defined below) (the “Deferred Discount”); and

WHEREAS, the Company and the Trustee desire to enter into this Agreement to set forth the terms and conditions pursuant to which the Trustee shall hold the Property.

NOW THEREFORE, IT IS AGREED:

1.Agreements and Covenants of Trustee.  The Trustee hereby agrees and covenants to:

(a)Hold the Property in trust for the Beneficiaries in accordance with the terms of this Agreement in the Trust Account established by the Trustee located in the United 

 

 

States at J.P. Morgan Chase Bank, N.A. (or at another U.S. chartered commercial bank with consolidated assets of $100 billion or more) and at a brokerage institution selected by the Trustee that is reasonably satisfactory to the Company;

(b)Manage, supervise and administer the Trust Account subject to the terms and conditions set forth herein;

(c)In a timely manner, upon the written instruction of the Company, invest and reinvest the Property in United States government securities within the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended, having a maturity of 185 days or less, or in money market funds meeting the conditions of paragraphs (d)(1), (d)(2), (d)(3) and (d)(4) of Rule 2a-7 promulgated under the Investment Company Act of 1940, as amended, which invest only in direct U.S. government treasury obligations, as determined by the Company; it being understood that the Trust Account will earn no interest while account funds are uninvested awaiting the Company’s instructions hereunder; while on deposit, the Trustee may earn bank credits or other consideration;

(d)Collect and receive, when due, all interest or other income arising from the Property, which shall become part of the “Property,” as such term is used herein;

(e)Promptly notify the Company and Jefferies LLC of all communications received by the Trustee with respect to any Property requiring action by the Company;

(f)Supply any necessary information or documents as may be requested by the Company (or its authorized agents) in connection with the Company’s preparation of tax returns relating to assets held in the Trust Account or in connection with the preparation or completion of the audit of the Company’s financial statements by the Company’s auditors;

(g)Participate in any plan or proceeding for protecting or enforcing any right or interest arising from the Property if, as and when instructed by the Company to do so;

(h)Render to the Company monthly written statements of the activities of, and amounts in, the Trust Account reflecting all receipts and disbursements of the Trust Account;

(i)Commence liquidation of the Trust Account only after and promptly after (x) receipt of, and only in accordance with, the terms of a letter from the Company (“Termination Letter”) in a form substantially similar to that attached hereto as either Exhibit A or Exhibit B signed on behalf of the Company by its Chief Executive Officer, President, Co-President, Chief Financial Officer, Chief Operating Officer, General Counsel, Secretary or Chairman of the board of directors of the Company (the “Board”) or other authorized officer of the Company, and complete the liquidation of the Trust Account and distribute the Property in the Trust Account, including interest (less up to $100,000 of interest that may be released to the Company to pay dissolution expenses and which interest shall be net of any taxes payable, it being understood that the Trustee has no obligation to monitor or question the Company’s position that an allocation has been made for taxes payable), only as directed in the Termination Letter and the other documents referred to therein; provided, that, in the case a Termination Letter in the form of Exhibit A is received, or (y) upon the date which is, the later of (A) 12 

 

 

months after the closing of the Offering (or up to 18 months from the closing of the Offering if the Company fully extends the time to complete a business combination as described in the Prospectus) and (B) such later date as may be approved by the Company’s shareholders in accordance with the Company’s amended and restated memorandum and articles of association, as it may be amended from time to time, if a Termination Letter has not been received by the Trustee prior to such date, in which case the Trust Account shall be liquidated in accordance with the procedures set forth in the Termination Letter attached as Exhibit B and the Property in the Trust Account, including interest (less up to $100,000 of interest that may be released to the Company to pay dissolution expenses and which interest shall be net of any taxes payable), shall be distributed to the Public Shareholders of record as of such date; 

(j)Upon written request from the Company, which may be given from time to time in a form substantially similar to that attached hereto as Exhibit C (a “Tax Payment Withdrawal Instruction”), withdraw from the Trust Account and distribute to the Company the amount of interest earned on the Property requested by the Company to cover any tax obligation owed by the Company as a result of assets of the Company or interest or other income earned on the Property, which amount shall be delivered directly to the Company by electronic funds transfer or other method of prompt payment, and the Company shall forward such payment to the relevant taxing authority; provided, however, that to the extent there is not sufficient cash in the Trust Account to pay such tax obligation, the Trustee shall liquidate such assets held in the Trust Account as shall be designated by the Company in writing to make such distribution so long as there is no reduction in the principal amount per share initially deposited in the Trust Account; provided, further, however, that if the tax to be paid is a franchise tax, the written request by the Company to make such distribution shall be accompanied by a copy of the franchise tax bill for the Company (it being acknowledged and agreed that any such amount in excess of interest income earned on the Property shall not be payable from the Trust Account).  The written request of the Company referenced above shall constitute presumptive evidence that the Company is entitled to said funds, and the Trustee shall have no responsibility to look beyond said request;

(k)Upon written request from the Company, which may be given from time to time in a form substantially similar to that attached hereto as Exhibit D (a “Shareholder Redemption Withdrawal Instruction”), the Trustee shall distribute on behalf of the Company the amount requested by the Company to be used to redeem Ordinary Shares from Public Shareholders properly submitted in connection with a shareholder vote to approve an amendment to the Company’s amended and restated memorandum and articles of association (A) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination involving the Company and one or more businesses (a “Business Combination”) or to redeem 100% of the Company’s public shares if it does not complete its initial Business Combination within twelve (12) months after the closing of the Offering (or 18 months from the closing of the Offering if the Company fully extends the time to complete a business combination as described in the Prospectus) or (B) with respect to any other provision relating to shareholders’ rights or pre-initial Business Combination activity.  The written request of the Company referenced above shall constitute presumptive evidence that the Company is entitled to distribute said funds, and the Trustee shall have no responsibility to look beyond said request; and

 

 

(l)Not make any withdrawals or distributions from the Trust Account other than pursuant to Section 1(i), (j) or (k) above.

2.Agreements and Covenants of the Company.  The Company hereby agrees and covenants to:

(a)Give all instructions to the Trustee hereunder in writing, signed by the Company’s Chairman of the Board, President, Co-President, Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, General Counsel, Secretary or other authorized officer of the Company.  In addition, except with respect to its duties under Sections 1(i), 1(j) and 1(k) hereof, the Trustee shall be entitled to rely on, and shall be protected in relying on, any verbal or telephonic advice or instruction which it, in good faith and with reasonable care, believes to be given by any one of the persons authorized above to give written instructions, provided that the Company shall promptly confirm such instructions in writing;

(b)Subject to Section 4 hereof, hold the Trustee harmless and indemnify the Trustee from and against any and all reasonable and documented expenses, including reasonable outside counsel fees and disbursements, or losses suffered by the Trustee in connection with any action taken by it hereunder and in connection with any action, suit or other proceeding brought against the Trustee involving any claim, or in connection with any claim or demand, which in any way arises out of or relates to this Agreement, the services of the Trustee hereunder, or the Property or any interest earned on the Property, except for expenses and losses resulting from the Trustee’s gross negligence, fraud or willful misconduct.  Promptly after the receipt by the Trustee of notice of demand or claim or the commencement of any action, suit or proceeding, pursuant to which the Trustee intends to seek indemnification under this Section 2(b), it shall notify the Company in writing of such claim (hereinafter referred to as the “Indemnified Claim”).  The Trustee shall have the right to conduct and manage the defense against such Indemnified Claim; provided that the Trustee shall obtain the consent of the Company with respect to the selection of counsel, which consent shall not be unreasonably withheld.  The Trustee may not agree to settle any Indemnified Claim without the prior written consent of the Company, which such consent shall not be unreasonably withheld.  The Company may participate in such action with its own counsel;

(c)Pay the Trustee the fees set forth on Schedule A hereto, including an initial acceptance fee, annual administration fee, and transaction processing fee which fees shall be subject to modification by the parties from time to time.  It is expressly understood that the Property shall not be used to pay such fees unless and until it is distributed to the Company pursuant to Sections 1(i) through 1(j) hereof.  The Company shall pay the Trustee the initial acceptance fee and the first annual administration fee at the consummation of the Offering.  The Company shall not be responsible for any other fees or charges of the Trustee except as set forth in this Section 2(c) and as may be provided in Section 2(b) hereof;

(d)In connection with any vote of the Company’s shareholders regarding a Business Combination, provide to the Trustee an affidavit or certificate of the inspector of elections for the shareholder meeting verifying the vote of such shareholders regarding such Business Combination;

 

 

(e)Provide Jefferies LLC with a copy of any Termination Letter(s) and/or any other correspondence that is sent to the Trustee with respect to any proposed withdrawal from the Trust Account promptly after it issues the same;

(f)Expressly provide in any Instruction Letter (as defined in Exhibit A) delivered in connection with a Termination Letter in the Form of Exhibit A that the Deferred Discount be paid directly to the account or accounts directed by Jefferies LLC; and

(g)Instruct the Trustee to make only those distributions that are permitted under this Agreement, and refrain from instructing the Trustee to make any distributions that are not permitted under this Agreement.

3.Limitations of Liability.  The Trustee shall have no responsibility or liability to:

(a)Imply obligations, perform duties, inquire or otherwise be subject to the provisions of any agreement or document other than this Agreement and that which is expressly set forth herein;

(b)Take any action with respect to the Property, other than as directed in Section 1 hereof, and the Trustee shall have no liability to any party except for liability arising out of the Trustee’s gross negligence, fraud or willful misconduct;

(c)Institute any proceeding for the collection of any principal and income arising from, or institute, appear in or defend any proceeding of any kind with respect to, any of the Property unless and until it shall have received instructions from the Company given as provided herein to do so and the Company shall have advanced or guaranteed to it funds sufficient to pay any expenses incident thereto;

(d)Refund any depreciation in principal of any Property;

(e)Assume that the authority of any person designated by the Company to give instructions hereunder shall not be continuing unless provided otherwise in such designation, or unless the Company shall have delivered a written revocation of such authority to the Trustee;

(f)The other parties hereto or to anyone else for any action taken or omitted by it, or any action suffered by it to be taken or omitted, in good faith and in the Trustee’s best judgment, except for the Trustee’s gross negligence, fraud or willful misconduct.  The Trustee may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel (including counsel chosen by the Trustee with written notification to the Company, which counsel may be the Company’s counsel), statement, instrument, report or other paper or document (not only as to its due execution and the validity and effectiveness of its provisions, but also as to the truth and acceptability of any information therein contained) which the Trustee believes, in good faith and with reasonable care, to be genuine and to be signed or presented by the proper person or persons.  The Trustee shall not be bound by any notice or demand, or any waiver, modification, termination or rescission of this Agreement or any of the terms hereof, unless evidenced by a written instrument delivered to the 

 

 

Trustee, signed by the proper party or parties and, if the duties or rights of the Trustee are affected, unless it shall give its prior written consent thereto;

(g)Verify the accuracy of the information contained in the Registration Statement;

(h)Provide any assurance that any Business Combination entered into by the Company or any other action taken by the Company is as contemplated by the Registration Statement;

(i)File information returns with respect to the Trust Account with any local, state or federal taxing authority or provide periodic written statements to the Company documenting the taxes payable by the Company, if any, relating to any interest income earned on the Property;

(j)Prepare, execute and file tax reports, income or other tax returns and pay any taxes with respect to any income generated by, and activities relating to, the Trust Account, regardless of whether such tax is payable by the Trust Account or the Company, including, but not limited to, franchise and income tax obligations, except pursuant to Section 1(j) hereof; or

(k)Verify calculations, qualify or otherwise approve the Company’s written requests for distributions pursuant to Sections 1(i), 1(j) or 1(k) hereof.

4.Trust Account Waiver.  The Trustee has no right of set-off or any right, title, interest or claim of any kind (“Claim”) to, or to any monies in, the Trust Account, and hereby irrevocably waives any Claim to, or to any monies in, the Trust Account that it may have now or in the future.  In the event the Trustee has any Claim against the Company under this Agreement, including, without limitation, under Section 2(b) or Section 2(c) hereof, the Trustee shall pursue such Claim solely against the Company and its assets outside the Trust Account and not against the Property or any monies in the Trust Account.

5.Termination.  This Agreement shall terminate as follows:

(a)If the Trustee gives written notice to the Company that it desires to resign under this Agreement, the Company shall use its reasonable efforts to locate a successor trustee, pending which the Trustee shall continue to act in accordance with this Agreement.  At such time that the Company notifies the Trustee that a successor trustee has been appointed and has agreed to become subject to the terms of this Agreement (whether following the Trustee giving notice that it desires to resign under this Agreement or the Company otherwise electing to replace the Trustee under this Agreement), the Trustee shall transfer the management of the Trust Account to the successor trustee, including but not limited to the transfer of copies of the reports and statements relating to the Trust Account, whereupon this Agreement shall terminate; provided, however, that in the event that the Company does not locate a successor trustee within ninety (90) days of receipt of the resignation notice from the Trustee, the Trustee may submit an application to have the Property deposited with any court in the State of New York or with the United States District Court for the Southern District of New York and upon such deposit, the Trustee shall be immune from any liability whatsoever;

 

 

(b)At such time that the Trustee has completed the liquidation of the Trust Account and its obligations in accordance with the provisions of Section 1(i) hereof and distributed the Property in accordance with the provisions of the Termination Letter, this Agreement shall terminate except with respect to Section 2(b); or

(c)If the Offering is not consummated within ten (10) business days of the date of this Agreement, in which case any funds received by the Trustee from the Company or Perception Capital Partners II LLC for purposes of funding the Trust Account shall be promptly returned to the Company or Perception Capital Partners II LLC, as applicable.

6.Miscellaneous.

(a)The Company and the Trustee each acknowledge that the Trustee will follow the security procedures set forth below with respect to funds transferred from the Trust Account.  The Company and the Trustee will each restrict access to confidential information relating to such security procedures to authorized persons.  Each party must notify the other party immediately if it has reason to believe unauthorized persons may have obtained access to such confidential information, or of any change in its authorized personnel.  In executing funds transfers, the Trustee shall rely upon all information supplied to it by the Company, including, account names, account numbers, and all other identifying information relating to a Beneficiary, Beneficiary’s bank or intermediary bank.  Except for any liability arising out of the Trustee’s gross negligence, fraud or willful misconduct, the Trustee shall not be liable for any loss, liability or out-of-pocket expense resulting from any error in the information or transmission of the funds.

(b)This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York. This Agreement may be executed in several original or facsimile counterparts, each one of which shall constitute an original, and together shall constitute but one instrument.

(c)This Agreement contains the entire agreement and understanding of the parties hereto with respect to the subject matter hereof.  Except for Section 1(i), 1(j) and 1(k) hereof (which sections may not be modified, amended or deleted without the affirmative vote of sixty five percent (65%) of the then outstanding Ordinary Shares and Class B ordinary shares, par value $0.0001 per share, of the Company voting together as a single class; provided that no such amendment will affect any Public Shareholder who has otherwise indicated his, her or its election to redeem his, her or its Ordinary Shares in connection with a shareholder vote sought to amend this Agreement), this Agreement or any provision hereof may only be changed, amended or modified (other than to correct a typographical error) by a writing signed by each of the parties hereto.  

(d)The parties hereto consent to the jurisdiction and venue of any state or federal court located in the City of New York, State of New York, for purposes of resolving any disputes hereunder.  AS TO ANY CLAIM, CROSS-CLAIM OR COUNTERCLAIM IN ANY WAY RELATING TO THIS AGREEMENT, EACH PARTY WAIVES THE RIGHT TO TRIAL BY JURY.

 

 

(e)Any notice, consent or request to be given in connection with any of the terms or provisions of this Agreement shall be in writing and shall be sent by express mail or similar private courier service, by certified mail (return receipt requested), by hand delivery, by electronic mail:

if to the Trustee, to:

Continental Stock Transfer & Trust Company
One State Street, 30th Floor
New York, New York 10004
Attn:  Francis Wolf & Celeste Gonzalez

Email:  fwolf@continentalstock.com

Email:  cgonzalez@continentalstock.com

if to the Company, to:

Perception Capital Corp. II

315 Lake Street East, Suite 301

Wayzata, MN 55391 

Attn:  Rick Gaenzle

Email:  rgaenzle@gilbertglobal.com 

in each case, with copies to:

Skadden, Arps, Slate, Meagher & Flom LLP
525 University Avenue
Palo Alto, California 94301
Attn:  Gregg A. Noel, Esq. and Michael J. Mies, Esq.
Email:  gregg.noel@skadden.com
Email:  michael.mies@skadden.com

and

Jefferies LLC

520 Madison Avenue

New York, New York 10022

Facsimile:  (646) 619-4437

Attn:  General Counsel

and

Paul Hastings LLP

515 South Flower Street, Twenty-Fifth Floor

Los Angeles, CA 90071

Facsimile:  (213) 627-0705

Attention:  Frank Lopez and Jonathan Ko

 

 

(f)This Agreement may not be assigned by the Trustee without the prior consent of the Company.

(g)Each of the Company and the Trustee hereby represents that it has the full right and power and has been duly authorized to enter into this Agreement and to perform its respective obligations as contemplated hereunder.  The Trustee acknowledges and agrees that it shall not make any claims or proceed against the Trust Account, including by way of set-off, and shall not be entitled to any funds in the Trust Account under any circumstance.

(h)This Agreement is the joint product of the Trustee and the Company and each provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.

(i)This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument.  Delivery of a signed counterpart of this Agreement by facsimile or electronic transmission shall constitute valid and sufficient delivery thereof.

(j)Each of the Company and the Trustee hereby acknowledges and agrees that Jefferies LLC is a third party beneficiary of this Agreement.

(k)Except as specified herein, no party to this Agreement may assign its rights or delegate its obligations hereunder to any other person or entity.

[Signature page follows]

 

 

 

 

 

 

 

IN WITNESS WHEREOF, the parties have duly executed this Investment Management Trust Agreement as of the date first written above.

CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Trustee

 

By: 

Name: 

Title:   

 

PERCEPTION CAPITAL CORP. II

 

By: 

Name: 

Title:   

 

 

 

 

[Signature Page to Investment Management Trust Agreement]

 

 

 

SCHEDULE A

			
	
Fee Item
	
Time and method of payment
	
Amount

	
Initial acceptance fee
	
Initial closing of the Offering by wire transfer.
	
$3,500.00

	
Annual fee
	
First year fee payable at initial closing of the Offering by wire transfer, thereafter on the anniversary of the effective date of the Offering by wire transfer or check.
	
$10,000.00

	
Transaction processing fee for disbursements to Company under Sections 1(i) and 1(j)
	
Billed to Company following disbursement made to Company under Sections 1(i) and 1(j)
	
$250.00

	
Paying Agent services as required pursuant to Section 1(i) and 1(k)
	
Billed to Company upon delivery of service pursuant to Section 1(i) and 1(k)
	
Prevailing rates

 

 

 

Sched. A-1

 

 

 

EXHIBIT A

[Letterhead of Company]

[Insert date]

Continental Stock Transfer & Trust Company
One State Street, 30th Floor
New York, New York 10004
Attn:  Francis Wolf & Celeste Gonzalez

Re:  Trust Account - Termination Letter

Dear Mr. Wolf and Ms. Gonzalez:

Pursuant to Section 1(i) of the Investment Management Trust Agreement between Perception Capital Corp. II (the “Company”) and Continental Stock Transfer & Trust Company (the “Trustee”), dated as of [●], 2021 (the “Trust Agreement”), this is to advise you that the Company has entered into an agreement with          (the “Target Business”) to consummate a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with the Target Business (the “Business Combination”) on or about [insert date].  The Company shall notify you at least seventy-two (72) hours in advance of the actual date (or such shorter time period as you may agree) of the consummation of the Business Combination (“Consummation Date”).  Capitalized terms used but not defined herein shall have the meanings set forth in the Trust Agreement.

In accordance with the terms of the Trust Agreement, we hereby authorize you to commence to liquidate all of the assets of the Trust Account and to transfer the proceeds into the above-referenced trust operating account at J.P. Morgan Chase Bank, N.A. to the effect that, on the Consummation Date, all of the funds held in the Trust Account will be immediately available for transfer to the account or accounts that Jefferies LLC (the “Representative”) (with respect to the Deferred Discount) and the Company shall direct on the Consummation Date.  It is acknowledged and agreed that while the funds are on deposit in the trust operating account at J.P. Morgan Chase Bank, N.A. awaiting distribution, neither the Company nor the Representative will earn any interest.

On the Consummation Date (i) counsel for the Company shall deliver to you written notification that the Business Combination has been consummated, or will be consummated substantially, concurrently with your transfer of funds to the accounts as directed by the Company (the “Notification”) and (ii) the Company shall deliver to you (a) a certificate of the Chief Executive Officer, which verifies that the Business Combination has been approved by a vote of the Company’s shareholders, if a vote is held and (b) joint written instruction signed by the Company and the Representative with respect to the transfer of the funds held in the Trust Account, including payment of the Deferred Discount from the Trust Account (the “Instruction Letter”).  You are hereby directed and authorized to transfer the funds held in the Trust Account immediately upon your receipt of the Notification and the Instruction Letter, in accordance with 

A-1

 

 

the terms of the Instruction Letter.  In the event that certain deposits held in the Trust Account may not be liquidated by the Consummation Date without penalty, you will notify the Company in writing of the same and the Company shall direct you as to whether such funds should remain in the Trust Account and be distributed after the Consummation Date to the Company.  Upon the distribution of all the funds, net of any payments necessary for reasonable unreimbursed expenses related to liquidating the Trust Account, your obligations under the Trust Agreement shall be terminated.

In the event that the Business Combination is not consummated on the Consummation Date described in the notice thereof and we have not notified you on or before the original Consummation Date of a new Consummation Date, then upon receipt by the Trustee of written instructions from the Company, the funds held in the Trust Account shall be reinvested as provided in Section 1(c) of the Trust Agreement on the business day immediately following the Consummation Date as set forth in the notice as soon thereafter as possible.

Very truly yours,

Perception Capital Corp. II

By:

Name:

Title:

Title:

cc:Jefferies LLC

 

 

 

A-2

 

 

 

EXHIBIT B

[Letterhead of Company]

[Insert date]

Continental Stock Transfer & Trust Company
One State Street, 30th Floor
New York, New York 10004
Attn:  Francis Wolf & Celeste Gonzalez

Re:  Trust Account - Termination Letter

Dear Mr. Wolf and Ms. Gonzalez:

Pursuant to Section 1(i) of the Investment Management Trust Agreement between Perception Capital Corp. II (the “Company”) and Continental Stock Transfer & Trust Company (the “Trustee”), dated as of [●], 2021 (the “Trust Agreement”), this is to advise you that the Company has been unable to effect a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with a Target Business (the “Business Combination”) within the time frame specified in the Company’s amended and restated memorandum and articles of association, as described in the Company’s Prospectus relating to the Offering.  Capitalized terms used but not defined herein shall have the meanings set forth in the Trust Agreement.

In accordance with the terms of the Trust Agreement, we hereby authorize you to liquidate all of the assets in the Trust Operating Account and to transfer the total proceeds into the trust operating account at J.P. Morgan Chase Bank N.A. to await distribution to the Public Shareholders.  The Company has selected [●]1 as the effective date for the purpose of determining when the Public Shareholders will be entitled to receive their share of the liquidation proceeds.  You agree to be the Paying Agent of record and, in your separate capacity as Paying Agent, agree to distribute said funds directly to the Company’s Public Shareholders in accordance with the terms of the Trust Agreement and the amended and restated memorandum and articles of association of the Company.  Upon the distribution of all the funds, your obligations under the Trust Agreement shall be terminated, except to the extent otherwise provided in Section 1(j) of the Trust Agreement. 

	
	 

	
1 
	
 12 months from the closing of the Offering (or if the Sponsor, upon five days advance notice prior to the applicable deadline, deposits into the trust account for a three-month extension $2,000,000, or $2,300,000 if the underwriters’ over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline and extends the time to complete a business combination, which such three-month extension may be exercised twice, up to 18 months from the closing of the Public Offering) or such later date as may be approved by the Company’s stockholders in accordance with the Company’s amended and restated certificate of incorporation.

B-1

 

 

 

Very truly yours,

Perception Capital Corp. II

By:

Name:

Title:

Title:

cc:Jefferies LLC

 

 

 

 

EXHIBIT C

[Letterhead of Company]

[Insert date]

Continental Stock Transfer & Trust Company
One State Street, 30th Floor
New York, New York 10004
Attn:  Francis Wolf & Celeste Gonzalez

Re:  Trust Account - Tax Payment Withdrawal Instruction

Dear Mr. Wolf and Ms. Gonzalez:

Pursuant to Section 1(j) of the Investment Management Trust Agreement between Perception Capital Corp. II (the “Company”) and Continental Stock Transfer & Trust Company (the “Trustee”), dated as of [●], 2021 (the “Trust Agreement”), the Company hereby requests that you deliver to the Company $                of the interest income earned on the Property as of the date hereof.  Capitalized terms used but not defined herein shall have the meanings set forth in the Trust Agreement.

The Company needs such funds to pay for the tax obligations as set forth on the attached tax return or tax statement.  In accordance with the terms of the Trust Agreement, you are hereby directed and authorized to transfer (via wire transfer) such funds promptly upon your receipt of this letter to the Company’s operating account at:

[WIRE INSTRUCTION INFORMATION]

Very truly yours,

Perception Capital Corp. II

By:

Name:

Title:

 

cc:Jefferies LLC

 

C-1

 

 

 

EXHIBIT D
[Letterhead of Company]

[Insert date]

Continental Stock Transfer & Trust Company
One State Street, 30th Floor
New York, New York 10004
Attn:   Francis Wolf & Celeste Gonzalez

Dear Mr. Wolf and Ms. Gonzalez:

Re:  Trust Account - Shareholder Redemption Withdrawal Instruction

Pursuant to Section 1(k) of the Investment Management Trust Agreement between Perception Capital Corp. II (the “Company”) and Continental Stock Transfer & Trust Company (the “Trustee”), dated as of [●], 2021 (the “Trust Agreement”), the Company hereby requests that you deliver to the redeeming Public Shareholders on behalf of the Company $                  of the principal and interest income earned on the Property as of the date hereof.  Capitalized terms used but not defined herein shall have the meanings set forth in the Trust Agreement.

The Company needs such funds to pay its Public Shareholders who have properly elected to have their Ordinary Shares redeemed by the Company in connection with a shareholder vote to approve an amendment to the Company’s amended and restated memorandum and articles of association (A) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial Business Combination or to redeem 100% of the Company’s public shares if it does not complete its initial Business Combination within such time as is described in the Company’s amended and restated certificate of memorandum and articles of association or (B) with respect to any other provision relating to shareholders’ rights or pre-initial Business Combination activity.  As such, you are hereby directed and authorized to transfer (via wire transfer) such funds promptly upon your receipt of this letter to the redeeming Public Shareholders in accordance with your customary procedures.

Very truly yours,

Perception Capital Corp. II

By:

Name:

Title:

 

cc:Jefferies LLC

D-1

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