108 Kodiak Sciences Inc. Consolidated Statements of Cash Flows (in thousands) . Year Ended December 31, 2018 Year Ended December 31, 2017 Year Ended December 31, 2016 Cash flows from operating activities Net loss................................................................................................................................... $ (41,443) $ (27,936) $ (17,132) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation.................................................................................................................... 490 549 257 Non-cash interest expense and amortization of debt discount and issuance cost.......................................................................................................... 5,482 1,161 — Change in fair value of redeemable convertible preferred stock warrant liability................................................................................................... 2,700 1,260 — Change in fair value of derivative instrument................................................................. 1,988 — — Extinguishment of debt................................................................................................... 5,479 — — Stock-based compensation.............................................................................................. 2,665 275 272 Changes in assets and liabilities: Prepaid expense and other current assets................................................................. (1,995) 368 270 Other assets .............................................................................................................. — 8 35 Accounts payable ..................................................................................................... (2,323) 2,282 23 Accrued and other current liabilities........................................................................ (2,105) 4,330 242 Other liabilities......................................................................................................... 31 48 (14) Net cash used in operating activities ................................................................. (29,031) (17,655) (16,047) Cash flows from investing activities Purchase of property and equipment...................................................................................... (78) (209) (771) Deposits on property and equipment ..................................................................................... (503) — — Net cash used in investing activities.................................................................. (581) (209) (771) Cash flows from financing activities Proceeds from issuance of common stock, net of offering costs........................................... 83,755 — — Payments for repurchase of early exercised stock options .................................................... — — (4) Proceeds from issuance of convertible notes (includes $9,560 and $8,000 from related parties for the years ended December 31, 2018 and 2017, respectively)................ 33,000 10,000 — Debt issuance cost.................................................................................................................. (140) (181) — Principal payments of capital lease........................................................................................ (108) (97) (62) Proceeds from issuance of common stock upon option exercise........................................... 49 3 5 Principal payments of tenant improvement allowance payable............................................. (85) (88) (59) Net cash provided by (used in) financing activities .......................................... 116,471 9,637 (120) Net increase (decrease) in cash, cash equivalents and restricted cash................................... 86,859 (8,227) (16,938) Cash, cash equivalents and restricted cash, at beginning of year .......................................... 1,535 9,762 26,700 Cash, cash equivalents and restricted cash, at end of year..................................................... $ 88,394 $ 1,535 $ 9,762 Reconciliation of cash, cash equivalents and restricted cash to consolidated balance sheets Cash and cash equivalents ..................................................................................................... $ 88,254 $ 1,395 $ 9,622 Restricted cash ....................................................................................................................... 140 140 140 Cash, cash equivalents and restricted cash in consolidated balance sheets........................... $ 88,394 $ 1,535 $ 9,762 Supplemental cash flow information: Cash paid for interest ............................................................................................................. $ 19 $ 24 $ 6 Supplemental disclosures of non-cash investing and financing information: Issuance of derivative instrument related to convertible notes payable ................................ $ 6,603 $ — $ — Unpaid offering costs............................................................................................................. $ 205 $ — $ — Offering costs paid in restricted stock awards....................................................................... $ 91 $ — $ — Redeemable convertible preferred stock warrant issued in connection with convertible notes ...................................................................................... $ — $ 1,040 $ — Acquisition of equipment through capital lease..................................................................... $ — $ 73 $ 246 Purchase of property and equipment under accounts payable and tenants improvement allowance payable ............................................................................ $ — $ — $ 731 The accompanying notes are an integral part of these consolidated financial statements.