159 En la práctica se encuentra que la mayor parte de los clientes especifican la

Convertible preferred stock outstanding as of January 31, 2014 and 2015, and July 31, 2015 consisted of the following:

January 31, 2014

Convertible Preferred Stock:

Shares Authorized Shares Issued and Outstanding Aggregate Liquidation Preference Net Proceeds (in thousands, except share data)

Series A . . . 24,360,000 24,360,000 $ 5,075 $ 5,038

Series B . . . 30,211,506 30,211,506 20,000 19,925

Series C . . . 14,253,774 14,253,774 30,444 30,346

Series D . . . 10,584,066 10,584,066 39,916 39,828

Series E . . . 25,350,000 24,697,064 171,187 167,833

PURE STORAGE, INC.

Notes to Consolidated Financial Statements

January 31, 2015 and July 31, 2015 (unaudited)

Convertible Preferred Stock:

Shares Authorized Shares Issued and Outstanding Aggregate Liquidation Preference Net Proceeds (in thousands, except share data)

Series A . . . 24,360,000 24,360,000 $ 5,075 $ 5,038 Series B . . . 30,211,506 30,211,506 20,000 19,925 Series C . . . 14,253,774 14,253,774 30,444 30,346 Series D . . . 10,584,066 10,584,066 39,916 39,828 Series E . . . 24,761,984 24,761,984 171,637 168,283 Series F . . . 15,897,337 14,307,603 225,000 220,803 Series F-1 . . . 3,811,285 3,801,746 59,786 59,717

Total convertible preferred stock . . . 123,879,952 122,280,679 $ 551,858 $ 543,940

We recorded the convertible preferred stock at fair value on the dates of issuance, net of issuance costs. Shares of our convertible preferred stock are not currently redeemable. We classify our preferred stock outside of stockholders’ deficit because, in the event of certain “liquidation events” that are not solely within our control (including a greater than 50% change in control, or sale of all or substantially all of our assets), the shares would become redeemable at the option of the holders. We did not adjust the carrying values of the convertible preferred stock to the deemed liquidation values of such shares since a liquidation event was not probable at any of the balance sheet dates. Subsequent adjustments to increase or decrease the carrying values to the ultimate liquidation values will be made only if and when it becomes probable that such a liquidation event will occur.

The holders of our convertible preferred stock have various rights, preferences, and privileges as follows: Conversion Rights

Each share of Series A, Series B, Series C, Series D, Series E, Series F and Series F-1 convertible preferred stock is convertible, at the option of the holder, into shares of Class B common stock, based on the then-effective applicable conversion rate for each series of convertible preferred stock (1-for-1 but subject to adjustment for certain diluting issuances, as defined). Shares of Series A, Series B, Series C, Series D, Series E, Series F and Series F-1 convertible preferred stock will be automatically converted: (i) upon the election of the holders of at least 70% of the then-outstanding shares of convertible preferred stock, voting together as a single class on an as- converted basis to Class B common stock or (ii) immediately upon the closing of the sale of our Class A common stock in a firm commitment underwritten public offering with gross proceeds to us (before underwriting discounts, commissions, and fees) of at least $30.0 million where our shares have been listed for trading on the New York Stock Exchange, NASDAQ Global Select Market or NASDAQ Global Market.

Adjustment of Conversion Price for Qualifying Dilutive Issuances

In the event we issue additional shares of Class B common stock after the Series F-1 convertible preferred stock original issue date without consideration or for a consideration per share less than the conversion price in effect immediately prior to such issuance, then and in each such event the conversion price would have been reduced to a price equal to such conversion price multiplied by the following fraction:

• the numerator of which is equal to the sum of (i) the product of the number of shares of Class B

common stock outstanding or deemed to be outstanding immediately prior to such issuance and the conversion price in effect immediately prior to such issuance) and (ii) the product of the number of additional shares of Class B common stock so issued and the average price per share received by us for the additional shares of Class B common stock so issued); and

PURE STORAGE, INC.

Notes to Consolidated Financial Statements

• the denominator of which is equal to the number of shares of Class B common stock outstanding or

deemed to be outstanding immediately prior to such issuance plus the number of additional shares of Class B common stock so issued.

Voting Rights

The holders of the convertible preferred stock are entitled to the number of votes equal to the number of shares of Class B common stock into which such convertible preferred stock is convertible.

The holders of convertible preferred stock, voting as a class as-if-converted to common stock, are entitled to elect four members of the board of directors. The holders of common stock, voting as a separate class, are entitled to elect one member of the board of directors. The holders of convertible preferred stock and common stock, voting together as a single class on an as-if-converted basis, are entitled to elect remaining members of the board of directors.

Dividend Rights

Holders of convertible preferred stock are entitled to receive noncumulative dividends at the rate of 8% of their applicable original issue price per share (as adjusted for any stock dividends, combinations, recapitalizations, or stock splits), on a pari passu basis when, as, and if, declared by the board of directors. No dividends will be paid to holders of common stock until the aforementioned dividends on convertible preferred stock have been paid. No dividends have been declared by the board of directors.

Liquidation Preference

Upon our liquidation, dissolution, or winding up or a change in control, whether voluntary or involuntary, the holders of Series F-1 will receive $15.73 per share, plus all declared but unpaid dividends thereon, the holders of Series F will receive $15.73 per share, plus all declared but unpaid dividends thereon, the holders of Series E will receive $6.93 per share, plus all declared but unpaid dividends thereon, the holders of Series D will receive $3.77 per share, plus all declared but unpaid dividends thereon, the holders of Series C will receive $2.14 per share, plus all declared but unpaid dividends thereon, the holders of Series B will receive $0.66 per share, plus all declared but unpaid dividends thereon, and the holders of Series A will receive $0.21 per share, plus all declared but unpaid dividends thereon, on a pari passu basis and prior and in preference to any payment or distribution to holders of common stock. After the aforementioned liquidation preference on the convertible preferred stock have been paid, the remaining assets will be distributed to the holders of the then outstanding common stock.

Redemption Rights

Our convertible preferred stock does not contain any date-certain redemption features. Note 8. Common Stock and Stockholders’ Deficit

Class A and Class B Common Stock

Our certificate of incorporation authorizes two classes of common stock, Class A and Class B. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting. Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to 10 votes per share. Shares of Class B common stock may be converted to Class A common stock at any time immediately following the closing of the IPO at the option of the stockholder. Shares of Class B common stock

PURE STORAGE, INC.

Notes to Consolidated Financial Statements

automatically convert to Class A common stock upon the following: (i) sale or transfer of such share of Class B common stock; (ii) the death of the Class B common stockholder (or nine months after the date of death if the stockholder is one of our founders); and (iii) on the final conversion date, defined as the earlier of (a) the first trading day on or after the date on which the outstanding shares of Class B common stock represent less than 10% of the then outstanding Class A and Class B common stock; (b) the tenth anniversary of the IPO; or (c) the date specified by vote of the holders of a majority of the outstanding shares of Class B common stock, voting as a single class.

Class A and Class B common stock are referred to as common stock throughout the notes to the consolidated financial statements, unless otherwise noted.

Class B Common Stock Reserved for Issuance

We had reserved shares of Class B common stock, on an as-if-converted basis, for future issuance as follows:

January 31, 2015 July 31, 2015

(unaudited)

Conversion of convertible preferred stock . . . 122,280,679 122,280,679

Shares underlying outstanding stock options . . . 54,284,474 59,928,620

Shares reserved for future option grants . . . 357,884 15,102,581

Total . . . 176,923,037 197,311,880

Note 9. Equity Incentive Plans