Kodiak Sciences Inc. Notes to Consolidated Financial Statements (in thousands, except share and per share data) 122 Prior to the closing of the Company’s IPO, the holders of redeemable convertible preferred stock had the following various rights and preferences: Liquidation Preference In the event of any liquidation event, the holders of the Series B redeemable convertible preferred stock were entitled to receive in any distribution of any of the assets of the Company in preference to the holders of the Series A redeemable convertible preferred stock or common stock, an amount equal to the original issue price, adjusted for any stock splits, stock dividends, recapitalizations, reclassifications, combinations or similar transactions (collectively, “anti-dilution adjustments”), plus all declared and unpaid dividends on such shares. After full payment to holders of the Series B redeemable convertible preferred stock, payment would be made to the holders of Series A redeemable convertible preferred stock, in preference to the holders of the common stock, an amount equal to the original issue price, adjusted for any anti-dilution adjustments, plus all declared and unpaid dividends on such shares. After the payment of the liquidation preference, all remaining assets available for distribution would be distributed ratably among the holders of the common stock. If available assets were insufficient to pay the full liquidation preference of a given series of redeemable convertible preferred stock, the assets available for distribution to holders of such preferred stock would be distributed among such holders on a pro rata basis. Notwithstanding the above, for purposes of determining the amount each holder of shares of redeemable convertible preferred stock was entitled to receive with respect to a liquidation event, each such holder of shares of a series of redeemable convertible preferred stock would be deemed to have converted such holder’s shares of such series into shares of common stock immediately prior to the liquidation event if, as a result of an actual conversion, such holder would receive, in the aggregate, an amount greater than the amount that would be distributed to such holder if such holder did not convert such series of redeemable convertible preferred stock into shares of common stock. If any such holder would be deemed to have converted shares of redeemable convertible preferred stock into common stock pursuant to this paragraph, then such holder would not be entitled to receive any distribution that would otherwise be made to holders of redeemable convertible preferred stock that had not converted into shares of common stock. Conversion Shares of any series of redeemable convertible preferred stock could be converted, at the option of the stockholder, into such number of fully paid and non-assessable shares of common stock. The conversion price was determined by dividing the original issuance price applicable to each series of redeemable convertible preferred stock, adjusted for any anti-dilution adjustments, by the applicable conversion price for such series. The Company’s redeemable convertible preferred stock was convertible into the Company’s shares of common stock on a one-for-one basis. Shares of redeemable convertible preferred stock would automatically be converted into shares of common stock at the then effective conversion rate for such share, upon earlier to occur of: (1) the date, or the occurrence of event, specified by the vote of or written consent of the holders of at least a majority of the redeemable convertible preferred stock voting together as a single class on an as-converted basis; and (2) immediately prior to the consummation of a firm commitment underwritten initial public offering pursuant to an effective registration statement filed under the Securities Act, covering the offer and sale of the Company’s common stock, provided that the per share price was at least $10.00 and gross proceeds to the Company were equal to or greater than $75.0 million. Dividends The redeemable convertible preferred stock dividends were not cumulative and were payable only when declared by the board of directors. No such dividends were declared. Such dividends were in preference to any dividends to holders of common stock. Voting Rights Each holder of redeemable convertible preferred stock would be entitled to the number of votes equal to the number of shares of common stock into which the shares of redeemable convertible preferred stock held by such holder could be converted as of the record date. Holders of redeemable convertible preferred stock and common stock generally vote as a single class. Redemption and Balance Sheet Classification The redeemable convertible preferred stock was recorded in mezzanine equity because while it was not mandatorily redeemable, it would become redeemable at the option of the stockholders upon the occurrence of certain deemed liquidation events that were considered not solely within the Company’s control.